EXHIBIT 10.2
ADDENDUM TO STOCK OPTION AGREEMENT
     This Addendum (the “Addendum”) to the Stock Option Agreement (the “Option
Agreement”) pursuant to the Keynote Systems, Inc. 1999 Equity Incentive Plan by
and between Jeffrey Kraatz (the “Optionee”) and Keynote Systems, Inc. (the
“Company”) is entered into by and between Optionee and the Company as of
April 1, 2006.
WITNESSETH
WHEREAS, the Optionee is an officer of the Company; and
WHEREAS, the Company, as a matter of practice, provides for the acceleration, in
certain cases, of the vesting of options (“Options”) granted to its officers;
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. The Company and the Optionee are entering into this Addendum to the Option
Agreement, concurrently with the execution of the Option Agreement, in order to
specify the terms and conditions of the acceleration, in certain cases, of the
vesting of Options granted to the Optionee under the Option Agreement.

2.   The following language shall be included at the end of 2.1 of the Option
Agreement:       “Notwithstanding the provisions of the preceding sentence
regarding the rate at which this Option shall vest, in the event that upon or
after a Sale of the Company, Optionee’s employment with the Company, or its
successor, is terminated without Cause, within twelve months from the Sale of
the Company, then immediately prior to the effectiveness of such termination
this Option shall vest with respect to (i) 25% of the Shares, if the date of
termination is less than one year from date of grant or (ii) 100% of the Shares,
if the date of termination is more than one year from date of grant. For such
purposes, the term “Sale of the Company” means any sale or disposition of all or
substantially all of the assets of the Company, or any merger or consolidation
of the Company with or into any other corporation, corporations, or other entity
in which more than 50% of the Company’s voting power is transferred. The term
“Cause” means (i) willfully engaging in gross misconduct that is materially and
demonstrably injurious to the Company; (ii) willful and continued failure to
substantially perform Optionee’s duties with the Company (other than incapacity
due to physical or mental illness), provided that such failure continues after
the Board of Directors has provided Optionee with a written demand for
substantial performance, setting forth in detail the specific respects in which
it believes Optionee has willfully and not substantially performed his duties
thereof and a reasonable opportunity (to be not less than 30 days) to cure the
same. For the above purposes, a termination by the Company without Cause
includes a termination of employment by Optionee within 30 days following any
one of the following events: (x) a 10% or more reduction in Optionee’s salary
that is not part of a general salary reduction

 

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    plan applicable to all officers of the successor Company; (y) a change in
Optionee’s position or status to a position that is not at the level of Vice
President or above with the successor; or (z) relocating Optionee’s principal
place of business, in excess of fifty (50) miles from the current location of
such principal place of business. This Option shall cease to vest upon
Optionee’s Termination and Optionee shall in no event be entitled under this
Option to purchase a number of shares of the Company’s Common Stock greater than
the “Total Option Shares.”

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     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in
duplicate by its duly authorized representative and Optionee has executed this
Agreement in duplicate as of the date first specified above.

                  KEYNOTE SYSTEMS INC.       OPTIONEE    
 
               
By:
  \s\ Umang Gupta
 
      \s\ Jeffrey Kraatz
 
(Signature)    
 
                Umang Gupta       Jeffrey Kraatz                   (Please print
name)       (Please print name)    
 
                CEO                           (Please print title)            

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