exv10w25w3



 





Exhibit 10.25.3

BUSINESS OBJECTS S.A.




2001 STOCK INCENTIVE PLAN




SUBSIDIARY STOCK INCENTIVE SUB-PLAN




effective as of the date of the 2004 annual shareholders’ meeting




     At the 2004 annual shareholders’ meeting, the shareholders of the Company
approved the adoption of this Subsidiary Stock Incentive Sub-Plan as a sub-plan
under the Company’s 2001 Stock Incentive Plan. The Subsidiary Stock Incentive
Sub-Plan provides for the grant by the Trustee to Subsidiary Beneficiaries of
Restricted Stock or Performance Shares (both as defined below) at the direction
of the Subsidiary Administrators.



     The terms and conditions of the Subsidiary Stock Incentive Sub-Plan are
set out below.



1. PURPOSES OF THE SUB-PLAN



     The purposes of this Sub-Plan are to enable the Subsidiaries to attract
and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Subsidiary Beneficiaries and
to promote the success of the Company’s worldwide business.



2. DEFINITIONS



     Initially capitalized terms shall have the meanings set forth in Section 2
of the Parent Plan. In addition, the following definitions shall apply when
used in this Sub-Plan:



     (a) “Award” means, individually or collectively, a grant under the
Sub-Plan of Restricted Stock, or Performance Shares.



     (b) “Award Agreement” means the written agreement setting forth the terms
and provisions applicable to each Award granted under the Sub-Plan. The Award
Agreement is subject to the terms and conditions of the Sub-Plan and the Parent
Plan.



     (c) “Awarded Stock” means the Shares subject to an Award.



     (d) “Parent Plan” means the 2001 Stock Incentive Plan, as amended from
time to time.



     (e) “Performance Share” means a performance share Award granted to a
Subsidiary Beneficiary pursuant to Section 8.



     (f) “Restricted Stock” means Shares granted pursuant to Section 7 of the
Sub-Plan.



     (g) “Shareholders’ Authorizations” means the approval in 2004 of the
Company’s shareholders regarding (i) the adoption of this Sub-Plan and (ii) the
issuance of new shares, the subscription of which will be reserved for the
related Trust.



     (h) “Sub-Plan” means this Subsidiary Stock Incentive Sub-Plan authorized
under the Parent Plan.



     (i) “Sub-Plan Trust” or “Trust” means the Business Objects Employee
Benefit Sub-Plan Trust from which Awards may be issued to Subsidiary
Beneficiaries pursuant to this Sub-Plan.


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     (j) “Subsidiary” means a “subsidiary corporation”, whether now or
hereafter existing, as defined in Section 424(f) of the Code. A Subsidiary
shall not include a company incorporated under the laws of France.



     (k) “Subsidiary Administrator” means the Board of Directors of a
Subsidiary, or a designated committee thereof, as shall administer this
Sub-Plan with respect to Subsidiary Beneficiaries of that Subsidiary, in
accordance with Section 4 of this Sub-Plan.



     (l) “Subsidiary Beneficiary” means any person employed by a Subsidiary.
Neither service as a Subsidiary Director nor payment of a director’s fee by the
Subsidiary shall be sufficient to constitute “employment” by the Subsidiary.



     (m) “Subsidiary Board” means the board of directors of a Subsidiary.



     (n) “Subsidiary Director” means a member of the board of directors of a
Subsidiary.



     (o) “Trustee” means the trustee of the Sub-Plan Trust.



3. STOCK SUBJECT TO THE SUB-PLAN



     Pursuant to the Shareholders’ Authorizations approving the Sub-Plan and
authorizing the Board to issue new shares on one or more occasions to be
subscribed by the Sub-Plan Trust for the purpose of granting Awards under the
Sub-Plan, the maximum number of new shares authorized by the shareholders to be
subscribed by the Sub-Plan Trust is 2,500,000 Shares, provided that, in no
event may the number of Shares issuable under the Parent Plan and the number of
Shares subscribed by the Sub-Plan Trust exceed the total number of Shares
authorized to be issued under the Parent Plan (including as authorized the
future automatic annual increases provided for in Section 3.1 of the Parent
Plan) prior to the adoption of the Shareholders Authorizations. Pursuant to
the Shareholders’ Authorizations, the Share issuance price to the Sub-Plan
Trust shall be decided by the Board or its Chairman and shall be equal to at
least 85% of the closing price in euros per Share on the last trading day
preceding the decision of issuance of the new shares by the Board or its
Chairman, as quoted on the Premier Marché of Euronext Paris S.A. on or such
other Regulated Market on which the Shares are traded, as such prices are
reported by Euronext Paris S.A. or such other source as the Board deems
reliable.



     If an Award is forfeited to or repurchased by the Trust, the forfeited or
repurchased shares which were subject thereto shall either (i) become available
for future grant or sale under the Sub-Plan to Subsidiary Beneficiaries of the
same Subsidiary (unless the Sub-Plan has terminated), or (ii) at the direction
of the Subsidiary Administrator, sold on a stock exchange with the proceeds
paid to the Subsidiary.



4. ADMINISTRATION OF THE SUB-PLAN


4.1 Procedure. The Sub-Plan shall be administered by the Trustee. With
respect to such administration, the Trustee shall follow the directions of the
Subsidiary Administrators.


4.2 Powers of the Subsidiary Administrators. Subject to the provisions of the
Sub-Plan, U.S. Applicable Laws and other applicable laws, the Subsidiary
Administrators shall have the authority, in their discretion, to instruct and
direct the Trustee with respect to the following actions:





	 	–	 	to select the Subsidiary Beneficiaries to whom Awards may be granted hereunder;

	 	–	 	to determine whether and to what extent Awards are granted hereunder;

	 	–	 	to determine the number of Shares to be covered by each Award granted hereunder;





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	 	–	 	to approve forms of agreement for use under the Sub-Plan;

	 	–	 	to determine the terms and conditions, not inconsistent
with the terms and conditions of the Sub-Plan, of any Awards
granted hereunder. Such terms and conditions include, but are not
limited to, the purchase price (if any), vesting schedules (which
may be performance based), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation
regarding any Award or the Shares relating thereto, based in each
case on such factors as the Subsidiary Administrators, in their
sole discretion, shall determine;

	 	–	 	to determine whether and to what extent Shares subject to
an Award shall be distributed at a specific time after vesting;

	 	–	 	to construe and interpret the terms of the Sub-Plan and
Awards granted pursuant to the Sub-Plan;

	 	–	 	to prescribe, amend and rescind rules and regulations
relating to the Sub-Plan, including rules and regulations relating
to sub-plans established for the purpose of qualifying for
preferred tax treatment under applicable tax laws;

	 	–	 	to modify or amend each Award (subject to Section 15.3 of
the Sub-Plan);

	 	–	 	to authorize the Trustee to execute on behalf of the
Subsidiary any instrument required to effect the grant of an Award
previously decided by the Subsidiary Administrator;

	 	–	 	to determine the terms and restrictions applicable to
Awards, including without limitation the sale of Shares acquired
pursuant to an Award during certain periods or upon certain events
which the Subsidiary Administrator shall determine in its sole
discretion; and

	 	–	 	to make all other determinations deemed necessary or
advisable for administering the Sub-Plan.





4.3 Effect of Subsidiary Administrator’s Decision; Effect of Trustee’s
Decision. The Subsidiary Administrator’s decisions, determinations and
interpretations shall be final and binding on the Trustee, subject to the
provisions of Section 15.3 of the Sub-Plan. The Trustee’s decisions,
determinations and interpretations in accordance with the Subsidiary
Administrator’s directions shall be final and binding on all Subsidiary
Beneficiaries.



5. LIMITATION


5.1 Neither the Sub-Plan nor any Award shall confer upon a Subsidiary
Beneficiary any right with respect to continuing the Subsidiary Beneficiary’s
employment with the Subsidiary, the Company or any Affiliated Company, nor
shall they interfere in any way with the Subsidiary or the Subsidiary
Beneficiary’s right, as the case may be, to terminate such employment at any
time, with or without cause.



6. TERM OF SUB-PLAN


6.1 The amended Sub-Plan is effective and Awards may be granted as of the date
of the Sub-Plan’s approval by the Company’s shareholders in 2004. It shall
continue in effect so long as the Parent Plan remains in effect, unless
terminated earlier.



7. RESTRICTED STOCK.


7.1 Grant of Restricted Stock. Subject to the terms and conditions of the
Sub-Plan, Restricted Stock may be granted by the Trustee to Subsidiary
Beneficiaries at any time as shall be determined by the Subsidiary
Administrator, in its sole discretion and as thereafter communicated to the
Trustee. The Subsidiary Administrator shall have complete discretion to
determine and instruct the Trustee as to (i) the number of Shares subject to a
Restricted Stock award granted to any Subsidiary Beneficiary, and (ii) the


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conditions that must be satisfied, which typically will be based principally or
solely on continued provision of services but may include a performance-based
component, upon which is conditioned the grant or vesting of Restricted Stock.
Restricted Stock shall be granted by the Trustee in the form of units to
acquire Shares from the Trust. Each such unit shall be the equivalent of one
Share for purposes of determining the number of Shares subject to an Award.
Until the Shares vest and are distributed from the Trust, the Trust shall hold
the Shares subject to an Award.


7.2 Other Terms. The Subsidiary Administrator, subject to the provisions of
the Sub-Plan, shall have complete discretion to determine the terms and
conditions of Restricted Stock granted by the Trustee pursuant to the Sub-Plan.
Restricted Stock grants shall be subject to the terms, conditions, and
restrictions determined by the Subsidiary Administrator and communicated to the
Trustee at the time the Restricted Stock is awarded. The Subsidiary
Administrator and hence the Trustee may require the recipient to sign a
Restricted Stock Award agreement as a condition of the award. Any certificates
representing the Shares of stock awarded shall bear such legends as shall be
determined by the Subsidiary Administrator and communicated to the Trustee.


7.3 Restricted Stock Award Agreement. Each Restricted Stock grant shall be
evidenced by an agreement that shall specify the purchase price (if any) and
such other terms and conditions as the Subsidiary Administrator, in its sole
discretion, shall determine and communicate to the Trustee; provided; however,
that if the Restricted Stock grant has a purchase price, such purchase price
must be paid no more than ten (10) years following the date of grant.



8. PERFORMANCE SHARES.


8.1 Grant of Performance Shares. Subject to the terms and conditions of the
Sub-Plan, Performance Shares may be granted by the Trustee to Subsidiary
Beneficiaries at any time as shall be determined by the Subsidiary
Administrator, in its sole discretion and as thereafter communicated to the
Trustee. The Subsidiary Administrator shall have complete discretion to
determine and instruct the Trustee as to (i) the number of Shares subject to a
Performance Share award granted to any Subsidiary Beneficiary, and (ii) the
conditions that must be satisfied, which typically will be based principally or
solely on achievement of performance milestones but may include a service-based
component, upon which is conditioned the grant or vesting of Performance
Shares. Performance Shares shall be granted by the Trustee in the form of
units to acquire Shares from the Trust. Each such unit shall be the equivalent
of one Share for purposes of determining the number of Shares subject to an
Award. Until the Shares vest and are distributed from the Trust, the Trust
shall hold the Shares subject to an Award.


8.2 Other Terms. The Subsidiary Administrator, subject to the provisions of
the Sub-Plan, shall have complete discretion to determine the terms and
conditions of Performance Shares granted by the Trustee pursuant to the
Sub-Plan. Performance Shares grants shall be subject to the terms, conditions,
and restrictions determined by the Subsidiary Administrator and communicated to
the Trustee at the time the Performance Shares are awarded which may include
such performance-based milestones as are determined appropriate by the
Subsidiary Administrator. The Subsidiary Administrator and hence the Trustee
may require the recipient to sign a Performance Shares Award agreement as a
condition of the award. Any certificates representing the Shares of stock
awarded shall bear such legends as shall be determined by the Subsidiary
Administrator and communicated to the Trustee.


8.3 Performance Share Award Agreement. Each Performance Share Award shall be
evidenced by an agreement that shall specify such other terms and conditions as
the Subsidiary Administrator, in its sole discretion, shall determine and
communicate to the Trustee.


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9. NON-TRANSFERABILITY OF AWARDS



     An Award may not be sold, pledged, assigned, hypothecated, transferred or
disposed of in any manner other than by will or by laws of descent or
distribution and may be exercised, during the lifetime of the Subsidiary
Beneficiary, only by the Subsidiary Beneficiary.



10. LEAVES OF ABSENCE.



     Unless the Subsidiary Administrator and Trustee provides otherwise or as
otherwise required by Applicable U.S. Laws or other applicable laws, vesting of
Awards granted hereunder shall cease commencing on the ninety-first day of any
unpaid leave of absence and shall only recommence upon return to active
service.



11. VOTING RIGHTS.



     Shares held in the Trust shall be voted by the Trustee, in its sole
discretion, as it deems in the best interest of the Subsidiary Beneficiaries.



12. DIVIDENDS AND TAX CREDITS.



     Any dividends or tax credits applicable to Shares underlying Awards that
are held in the Trust shall be distributed or forfeited at the same time as the
underlying Shares, according to their vesting or distribution schedule.



13. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION, MERGER OR ASSET SALE


13.1 Changes in capitalization. In the event of the carrying out by the
Company of any of the following financial operations:





	 	–	 	issuance of shares to be subscribed for in cash
or by set-off of existing indebtedness offered exclusively to
the shareholders,

	 	–	 	capitalization of reserves, profits, issuance
premiums or the distribution of free shares (other than
pursuant to this Sub-Plan or similar awards),

	 	–	 	issuance of bonds convertible or exchangeable
into shares offered exclusively to shareholders,

	 	–	 	distribution of reserves in cash or portfolio securities,

	 	–	 	capital reduction motivated by losses, and

	 	–	 	repurchase of its own Shares at a price higher
than market value, as described in Article 174-9A of the
decree no. 67-236 of March 23, 1967,





the Company and the Subsidiary Administrator shall effect an adjustment of the
number and the price of the Shares (if any) subject to Awards as to be
appropriate and equitable or such other adjustment as may be determined to
prevent diminution or enlargement of the Subsidiary Beneficiary’s rights
hereunder. The Company shall issue to the Trust the number of Shares to carry
out such adjustments within the limits defined by the Shareholder’s
Authorizations.



     The number of Shares which have been authorized for issuance under the
Sub-Plan as to which no Awards have yet been granted or which have been
returned to the Sub-Plan upon cancellation or expiration of an Award shall be
proportionately adjusted in the event the Company effects a share capital
increase by


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way of incorporation of reserves, premiums or profits, resulting either in
an increase of the nominal value of the shares or in a free allocation of
shares, or effects a reverse or forward stock split or a combination of shares.


13.2 Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Trustee shall notify each Subsidiary
Beneficiary as soon as practicable prior to the effective date of such proposed
transaction. The Subsidiary Administrator in its discretion may direct the
Trustee that any Trust repurchase option or forfeiture rights applicable to any
Award shall lapse 100%, and that the vesting of any Award shall accelerate
100%, provided the proposed dissolution or liquidation takes place at the time
and in the manner contemplated. To the extent it has not been previously
vested, an Award will terminate immediately prior to the consummation of such
proposed action.


13.3 Change in Control – Restricted Stock and Performance Shares. In the event
of a Change in Control of the Company, each outstanding Restricted Stock and
Performance Share award shall be assumed or an equivalent Restricted Stock or
Performance Share award substituted by the successor corporation or a Parent or
Subsidiary of the successor corporation (or a trust thereof). In the event
that the successor corporation refuses to assume or substitute for the
Restricted Stock or Performance Share award, the Subsidiary Beneficiary shall
fully vest in the Restricted Stock or Performance Share award including as to
Shares which would not otherwise be vested. For the purposes of this
paragraph, a Restricted Stock or Performance Share award shall be considered
assumed if, following the Change of Control, the award confers the right to
purchase or receive, for each Share subject to the Award immediately prior to
the Change in Control, the consideration (whether stock, cash, or other
securities or property) received in the Change in Control by holders of Shares
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received was not solely ordinary shares of the successor
corporation, or its Parent, the Subsidiary Administrator and Trustee may, with
the consent of the successor corporation, provide for the consideration to be
received, for each Share and each unit to acquire a Share subject to the Award,
to be solely ordinary shares of the successor corporation or its Parent equal
in fair market value to the per share consideration received by holders of
Shares in the Change in Control.



14. DATE OF GRANT



     The date of grant of an Award shall be, for all purposes, the date on
which the Trustee makes the determination granting such Award. Notice of the
determination shall be provided to each Subsidiary Beneficiary within a
reasonable time after the date of such grant.


15. AMENDMENT AND TERMINATION OF THE PLAN


15.1 Amendment and Termination. The Subsidiary Administrator may at any time
amend, alter, suspend or terminate the Sub-Plan.


15.2 Shareholder Approval. The Company shall obtain shareholder approval of
any Sub-Plan amendment to the extent necessary and desirable to comply with
applicable laws, rules or regulations, including the requirements of any
exchange or quotation system on which the Shares or ADRs are listed or quoted).
Such shareholder approval, if required, shall be obtained in such a manner and
to such a degree as is required by the applicable laws, rules or regulations.


15.3 Effect of Amendment or Termination. No amendment, alteration, suspension
or termination of the Sub-Plan shall impair the rights of any Subsidiary
Beneficiary, unless mutually agreed otherwise


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between the Subsidiary Beneficiary and the Subsidiary Administrator, which
agreement must be in writing and signed by the Subsidiary Beneficiary and the
Subsidiary Administrator.


16. CONDITIONS UPON ISSUANCE OF SHARES


16.1 Legal Compliance. Shares shall not be distributed from the Trust pursuant
to an Award unless the delivery of such Shares shall comply with all relevant
provisions of law including, without limitation, the Law, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, Applicable U.S. Laws and the requirements of any stock exchange or
quotation system upon which the Shares may then be listed or quoted.


16.2 Investment Representations. As a condition to the grant or vesting of an
Award or the Awarded Shares, the Subsidiary Beneficiary may be required to
represent and warrant that the Shares are being purchased only for investment
and without any present intention to sell or distribute such Shares if the
Trustee and Subsidiary Administrator decide that such a representation is
required.


17. LIABILITY OF COMPANY AND SUBSIDIARY


The inability of the Trust to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Subsidiary Administrators
to be necessary to the lawful distribution of any Shares hereunder, shall
relieve the Company and the Subsidiary of any liability in respect of the
Trust’s failure to distribute such Shares as to which such requisite authority
shall not have been obtained.


18. LAW AND JURISDICTION AND LANGUAGE


This Sub-Plan shall be governed by and construed in accordance with the
laws of the nation in which the Subsidiary directing the Trustee to grant an
Award has its principal place of business.




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