EXHIBIT
10.1


 


SOFTBRANDS,
INC.


DIRECTOR


NONQUALIFIED
STOCK OPTION AGREEMENT


 


THIS AGREEMENT, made             
by and between SoftBrands, Inc., a Delaware corporation (the “Company”), and                   
(“Director”).


 


WITNESSETH, THAT:


 


WHEREAS, the Company pursuant to its 2001 Stock
Incentive Plan wishes to grant this stock option to Director.


 


NOW, THEREFORE, in consideration of the premises and
of the mutual covenants herein contained, the parties hereto hereby agree as
follows:


 


1.                                       Grant
of Option


 


The Company hereby grants to Director, on the date set
forth above, the right and option (hereinafter referred to as the “option”) to
purchase all or any part of an aggregate of                
shares of Common Stock, $.01 par value, at the price of $             
per share on the terms and conditions set forth herein.  The Option is not intended to be an incentive
stock option within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended (the “Code”).


 


2.                                       Duration
and Exercisability


 


(a)                                  The
Option shall not be exercisable on the date of grant.  The Option shall become fully vested and
exercisable in its entirety on the seventh (7th) anniversary of the
Grant Date.  The Option shall terminate,
if not otherwise terminated, on the tenth anniversary of the date of grant.


 


(b)                                 Notwithstanding
the foregoing, in the event that (i) the Company completes an underwritten initial public
offering of its common stock pursuant to an effective registration statement
filed with the Securities and Exchange Commission in accordance with the
Securities Act of 1933, as amended (an “IPO”) or (ii) becomes subject, pursuant
to an effective registration under Section 12(g) of the Securities Exchange Act
of 1934 (the “Exchange Act”) to the reporting requirements of Section 13 or
15(d) of the Exchange Act, then this Option shall be exercisable, but only to
the extent vested in accordance with the schedule contained in Section 2(c), on
the date (the “Exercisability Date”) that is (A) in the case of an IPO, 180
days following the consummation of such IPO or (B) in the case of an Exchange
Act registration, upon the effective date of such registration, and shall
thereafter become further exercisable to the extent vested in accordance with
Section 2(c).  In the event of a change
of control, this option shall become exercisable with respect to all of the
shares subject to this option, regardless of the degree of vesting in
accordance with Section 2(c).  For such
purposes, a “change of control” shall mean any of the following:  (i) the consummation of a merger or
consolidation of the Company with or into another entity or any other corporate
reorganization, if more than 50% of the combined voting power of the continuing
or surviving entity’s securities outstanding immediately after such merger,
consolidation or other reorganization are owned by persons who were not
stockholders of the Company immediately prior to such merger, consolidation or
other reorganization, (ii) a


 





















 


public announcement that
any person has acquired beneficial ownership of 51% or more of the then
outstanding shares of common stock of the Company and, for this purpose, the
terms “person” and “beneficial ownership” shall have the meanings provided in
Section 13(d) of the Securities Exchange Act of 1934, as amended, or related
rules promulgated by the Securities and Exchange Commission, (iii) the
commencement of or public announcement of an intention to make a tender or
exchange offer for 51% or more of the then outstanding shares of the common
stock of the Company, or (iv) a sale of all or substantially all of the
assets of the Company.


 


(c)                                  The
Option shall be vested for purposes of acceleration of exercisability in
accordance with section 2(b) in accordance with the following schedule:


 


	
  On or after each of

  the following dates

  	
   

  	
  Additional
  percentage

  of Option

  which is exercisable

  
	
  On the Date of Grant

  	
   

  	
  1/3 of the Option

  
	
  1st Anniversary of the Grant Date

  	
   

  	
  1/3 of the Option

  
	
  2nd Anniversary of the Grant Date

  	
   

  	
  1/3 of the Option

  



 


3.                                       Effect
of Termination of Position


 


(a)                                  If
Director shall cease to be a director of the Company for any reason other than
his or her gross and willful misconduct, Director (or Director’s successor)
shall have the right to exercise the Option at any time after such termination
of Director’s position as director for the duration of the Option and the
option shall continue to vest, and shall become exercisable, in accordance with
its terms.


 


(b)                               In
the event that Director shall cease to be a director of the Company by reason
of his or her gross and willful misconduct during the course of his or her
service as a director of the Company, including but not limited to wrongful
appropriation of funds of the Company, or the commission of a gross misdemeanor
or felony, the Option shall be terminated as of the date of the misconduct.


 


4.                                       Manner
of Exercise


 


(a)                                  The
Option can be exercised only by Director or other proper party by delivering
within the option period written notice to the Company at its principal
office.  The notice shall state the
number of shares as to which the Option is being exercised and be accompanied
by payment in full of the option price for all shares designated in the notice.


 


(b)                                 Director
may, at Director’s election, pay the Option price either by check (bank check,
certified check or personal check) or by delivering to the Company for
cancellation Common Stock of the Company with a fair market value equal to the
option price.  For these purposes, the
fair market value of the Company’s Common Stock shall be the average of the
closing representative bid and asked prices of the Common Stock as reported on
the National Association of Securities Dealers Automated Quotation System or,
if the Common Stock is then traded on a national securities exchange, the
closing price of the stock on such exchange, or, if the Common Stock of the
Company is not publicly traded, as otherwise reasonably determined by the
Company.


 


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5.                                       Miscellaneous


 


(a)                                  The
Option is issued pursuant to the Company’s 2001 Stock Incentive Plan and is
subject to its terms.  The terms of the
Plan are available for inspection during business hours at the principal
offices of the Company.


 


(b)                                 This
Agreement shall not confer on Director any right with respect to employment or
to the continuance of any position on the board of directors of the Company or
any of its subsidiaries, nor will it interfere in any way with the right of the
Company, through its other directors or shareholders, to remove Director at any
time.  Director shall have none of the
rights of a shareholder with respect to shares subject to the Option until such
shares shall have been issued to him or her upon exercise of the Option.


 


(c)                                  The
exercise of all or any part of the Option shall only be effective at such time
as counsel to the Company shall have determined that the issuance and delivery
of Common Stock pursuant to such exercise will not violate any state or federal
securities or other laws.  Director may
be required by the Company, as a condition of the effectiveness of any exercise
of the Option, to agree in writing that all Common Stock to be acquired
pursuant to such exercise shall be held for Director’s own account without a
view to any further distribution thereof, that the certificates for such shares
shall bear an appropriate legend to that effect and that such shares will not
be transferred or disposed of except in compliance with applicable federal and
state securities laws.  The Company may,
in its sole discretion, defer the effectiveness of any full or partial exercise
of the Option in order to allow the issuance of Common Stock pursuant thereto
to be made pursuant to registration or an exemption from registration or other
methods for compliance available under federal or state securities laws.  The Company shall be under no obligation to
effect the registration pursuant to the Securities Act of 1933 of any Common
Stock to be issued upon exercise of the Option or to effect similar compliance
under any state laws.  The Company shall
inform Director in writing of its decision to defer the effectiveness of the
exercise of the Option.  During the
period that the effectiveness of the exercise of the Option has been deferred,
Director may, by written notice, withdraw such exercise and obtain the refund
of any amount paid with respect thereto.


 


(d)                                 Notwithstanding
any other provision of this Option Agreement, if there shall be any change in
the common stock subject to the Option through merger, consolidation,
reorganization, recapitalization, dividend or other distribution, stock split
or other similar corporate transaction or event of the Company, or the Company
shall enter into a written agreement to undergo such a transaction or event,
the Company, in its absolute discretion, may either:  (i) make appropriate adjustment in the number
of shares and the price per share of the shares subject to the Option in order
to prevent dilution or enlargement of the Option rights granted hereunder
(provided that the number of shares subject to the Option shall always be a
whole number) or (ii) cancel any or all of this Option and pay to Director in
cash the value of such cancelled Option or portion thereof based on the price
per share received, or to be received, by a shareholder of the Company in such
transaction event


 


(e)                                  The
Company shall at all times during the term of the Option reserve and keep
available such number of shares as will be sufficient to satisfy the
requirements of this Agreement.


 


(f)                                    In
order to provide the Company with the opportunity to claim the benefit of any
income tax deduction which may be available to it upon the exercise of the
Option, and in order to comply with all applicable federal or state income tax
laws or regulations, the Company may take such action as it deems appropriate
to insure that, if necessary, all applicable federal or state payroll,
withholding, income or other taxes are withheld or collected from Director.


 


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IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed on the day and year first above written.


 


 


	
   

  	
  SoftBrands, Inc.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
  David G. Latzke, Senior Vice President —

  	
   

  
	
   

  	
  Chief Financial Officer and Secretary

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ 

  	
   

  



 


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