Exhibit 10.36


 


Witness
Systems Stock Option

Inducement Grant for Contractors who will become employees of Witness Systems
Software India Pvt. Ltd.


 


Option Award


 


Note:  Except as otherwise provided in this Option
Award document, the Option referred to herein shall be subject to the terms and
conditions of the Amended and Restated Stock Incentive Plan of Witness Systems,
Inc. (the “Plan”), as if it had been granted thereunder, although it is not
granted under the Plan.


 


1.             Exercise Period of Option. Subject to the terms and
conditions of this Option Award document and the Plan, and unless otherwise
modified by a written modification signed by the Company and Optionee, this
Option may be exercised with respect to all of the Shares, but only according
to the vesting schedule, prior to the date which is five (5) years (the “Term”)
following the date of grant (hereinafter “Expiration Date”).


 


The Company hereby grants to
the Optionee, named in the Notice of Grant attached herewith as Schedule 1 to this Option Award document, an option to
purchase the number of Shares set forth in the Notice of Grant, at the exercise
price per Share set forth in the ‘Notice of Grant’ and subject to the terms and
conditions of the Plan. In the event of a conflict between the terms and
conditions of the Plan and this Option Grant, the terms and conditions of this
Option Grant shall prevail.


 


In the event of Common Stock
split by the Company, the Option Award will also be adjusted accordingly.


 


2.             Restrictions on Exercise.  This
Option may not be exercised, unless such exercise is in compliance with the
Securities Act of 1933, as well as Central Board of Direct Taxes Guidelines and
Securities and Exchange Board of India Guidelines prescribed with regard to
Employee Stock Option Plans and any other applicable securities laws, as they
are in effect on the date of exercise, and the requirements of any stock
exchange or national market system on which the Company’s Common Stock may be
listed or traded at the time of exercise. Optionee understands that the Company
is under no obligation to register, qualify or list the Shares with the
Securities and Exchange Board of India (“SEBI”), any state securities
commission or any stock exchange to effect such compliance.


 


2.1          3. Termination of Option. In
addition to the above restriction on transferability of Shares, the Company may
determine such other restrictions on transfer of Shares by the Optionee
provided that such restrictions are not more than the restrictions on the other
Shares of the Company.


 


4.
Termination of Option. Except as provided below
in this Section, this Option may not be exercised after the date which is
thirty (30) days after Optionee ceases to perform services for the Company, or
any Parent or Subsidiary. Optionee shall be considered to perform services for
the Company, or any Parent or Subsidiary, for all purposes under this Section,
if Optionee is an officer or full-time employee of the Company, or any Parent
or Subsidiary, or if the Board determines that Optionee is rendering substantial
services as a part-time employee, consultant, contractor or advisor to the
Company, or any Parent or Subsidiary. The Board shall have discretion to
determine whether Optionee has ceased to perform services for the Company, or
any Parent or Subsidiary, and the effective date on which such services cease
(the “Termination Date”). Notwithstanding anything contained herein to the
contrary, if the corporate position of Optionee is, at any time, altered or
revised such that Optionee’s responsibilities are materially reduced or
decreased for any reason, as determined by the Board in its sole discretion,
the vesting of Shares shall cease, effective as of the date of such reduction
in Optionee’s employment responsibilities; provided, however, except as otherwise
provided in this Option and the Plan, Optionee shall have the right to exercise
this Option with respect to Shares which have been vested as of the date of
such reduction of Optionee’s responsibilities.


 


2.2          a)            Termination Generally. If Optionee ceases to perform services for the
Company, or any Parent or Subsidiary, for


 

















 


any reason,
except death or disability this Option shall immediately be forfeited, along
with any and all rights or subsequent rights attached thereto, thirty (30) days
following the Termination Date, but in no event later than the Expiration Date.
If, on the date of termination, the Optionee is not vested as to such
Optionee’s entire Option, the unvested portion of the Option shall expire. If,
after termination, the Optionee does not exercise the vested portion of the
Option within the time specified herein, the Option shall expire.


 


2.3          (b)          Death or Disability.              If
Optionee ceases to perform services for the Company, or any Parent or
Subsidiary, as a result of the death or disability of Optionee (as determined
by the Board in its sole discretion), this Option, to the extent (and only to
the extent) that it would have been exercisable by Optionee on the Termination
Date, may be exercised by Optionee (or, in the event of Optionee’s death, by
Optionee’s legal representative) within ninety (90) days after the Termination
Date, but in no event later than the Expiration Date. If, on the date of
termination, the Optionee is not vested as to such Optionee’s entire Option,
the Shares covered by the unvested portion of the Option shall expire. If,
after termination, the Optionee does not exercise the vested portion of the
Option within the time specified herein, the Option shall expire.


 


2.4          (c)           Retirement of Optionee. In the event of retirement
of an Optionee from the Company at the instance of or with consent of the
Company, the Optionee will continue to hold all vested Options and can exercise them within
the exercise period. The above is applicable provided the Optionee does not
enter into competition or is not employed by a competitor of the Company.


 


2.5          (d)          Unvested Options. All unvested options shall lapse in case the Optionee resigns or
retires, or otherwise either severs his/her relationship with the Company or is
dismissed whether for a Cause or otherwise or dies or is discharged due to
permanent disability, either voluntarily or by law.


 


2.6          (e)           No Right to Employment.
Nothing in the Plan or this Option Award document shall confer on Optionee any
right to continue in the employment of, or other relationship with, the
Company, or any Parent or Subsidiary, or limit in any way the right of the
Company, or any Parent or Subsidiary, to terminate Optionee’s employment or
other relationship at any time, with or without cause.


 


5.             Manner of Exercise.


 


2.7          (a)          Exercise Agreement. This Option shall be
exercisable by delivery to the Company of such form of exercise agreement,
notice, or other form as may be approved or accepted by the Company from time
to time, which shall set forth Optionee’s election to exercise this Option, the
number of Shares being purchased, any restrictions imposed on the Shares, and
such other representations and agreements as may be required by the Company to
comply with applicable securities laws.


 


2.8          (b)          Exercise Price. Such notice shall be
accompanied by full payment of the Exercise Price for the Shares being
purchased. Payment for the Shares may be made in  cash, by cheque or, where permitted by law
and approved in advance and in writing by the Committee of the Board in its
sole discretion:  (i) by surrender of
shares of Common Stock of the Company that have been owned by Optionee for more
than six (6) months and that were paid for with cash; (ii) by instructing the
Company to withhold Shares otherwise issuable pursuant to the exercise of the
Option having a Fair Market Value equal to the Exercise Price of the Shares
being purchased (including the withheld Shares); (iii) by waiver of
compensation accrued by Optionee for services rendered; or (iv) a combination
of the foregoing.


 


2.9          (c)           Taxes. Prior to the issuance of
Shares upon exercise of this Option, Optionee must pay, or make adequate
provision for, any applicable central or state tax obligations of the Company.
Where approved by the Compensation Committee of the Board of Directors,
Optionee may provide for payment of taxes upon exercise of the Option by
requesting that the Company retain Shares with a Fair Market Value equal to the
minimum amount of taxes required to be withheld. In such case, the Company
shall issue the net


 

















 


number
of Shares to Optionee by deducting the Shares retained from the Shares
otherwise issuable upon exercise.


 


2.10        (d)          Issuance of Shares. Provided that such notice
and payment are in form and substance satisfactory to counsel for the Company,
the Company shall cause the Shares to be issued in the name of Optionee or
Optionee’s legal representative.


 


6.             Non transferability of Option. This Option may not be
transferred in any manner, other than by will or by the laws of descent and
distribution, and may be exercised during Optionee’s lifetime only by Optionee.
The terms of this Option shall be binding upon the executor, , successors and
assigns of Optionee.


 


7.             Tax Consequences. OPTIONEE
UNDERSTANDS THAT THE GRANT AND EXERCISE OF THIS OPTION, AND THE SALE OF SHARES
OBTAINED THROUGH THE EXERCISE OF THIS OPTION, MAY HAVE ADVERSE TAX CONSEQUENCES
TO OPTIONEE. OPTIONEE SHOULD CONSULT WITH HIS OR HER TAX ADVISOR AND MAY NOT
RELY ON THE COMPANY FOR ANY FINANCIAL, TAX OR OTHER ADVICE.


 


8.             Interpretation. Any dispute regarding the interpretation
of this Option Award document shall be submitted by Optionee or the Company to
a Committee of the Board, which shall review such dispute at its next regular
meeting. The resolution of such a dispute by a Committee of the Board shall be
final and binding on the Company and Optionee.


 


9.             Entire Agreement and Governing Law. The Plan is
incorporated herein by this reference. The granting of this Option constitutes
a full accord, satisfaction and release of all obligations or commitments made
to Optionee by the Company or any of its officers, directors, shareholders or
affiliates with respect to the issuance of any securities, or rights to acquire
securities, of the Company or any of its affiliates. This Option Award document
and the Plan constitute the entire agreement of the parties hereto, and
supersede all prior undertakings and agreements with respect to the subject
matter hereof. Any reference(s) to any ‘term’ or ‘terms’ not expressly defined
in this Option Award document shall have the meaning prescribed to it under the
said Plan.


 


This Option Award document
shall be governed by applicable laws of India.


 


10.          Exercisability of Option. Subject
to the terms of the Plan and this Option Award document, the issuance of Shares
pursuant to the exercise of this Option shall be subject to the limitations set
forth herein and defined below. For purposes of this Section, “Continuous
Service” means a period of continuous performance of services by Optionee for
the Company, a Parent, or a Subsidiary, as determined by the Board.


 


Four Year Vesting:
 Optionee
may exercise this Option with respect to the percentage of Shares set forth
below only after Optionee has completed the following periods of Continuous
Service following the date of grant:


 


(b)         After twelve (12) months
of Continuous Service, up to twenty-five percent (25%) of the Shares;


 


(c)          After thirteen (13)
months of Continuous Service, and for each additional month of Continuous
Service thereafter through the end of the forty-eighth (48th) month
of Continuous Service, an additional amount of Shares per month; such amount
being equal to the quotient of 75% of the Shares divided by 36, such that after
forty-eight (48) months of Continuous Service, one hundred percent (100%) of
the Shares shall have vested.


 


If Optionee’s employment
with the Company is terminated by the Company other than for Cause (as defined
below) or by Optionee for Good Reason (as defined below) at any time (i) during
the 90-day period before a Change of Control (as defined below) and (ii) for
one hundred eighty (180) days after a Change of Control, then (A) the Option
granted hereby, if less than fully vested as of the


 

















 


Termination Date , shall
be deemed fully vested and exercisable; and (B) Section 7 (other than the
second sentence thereof) shall be deleted and replaced with the following:
“This Option may not be exercised more than one hundred eighty (180) days from
the later of: Optionee’s Termination Date or the date Optionee ceases to
perform services for the Company, or any Parent or Subsidiary (which date shall
be determined by the Board in its reasonable discretion).”


 


Definitions. For purposes of this Option, the following
definitions shall apply:


 


1.             Change of Control. A “Change
of Control” shall be conclusively deemed to have occurred if (and only if) any
of the following shall have taken place: (i) a Change of Control is reported by
the Company in accordance with US law; (ii) any person  is or becomes the beneficial owner  directly or indirectly, of securities of the
Company representing fifty percent (50%) or more of the combined voting power
of the Company’s then outstanding securities; or (iii) following the election
or removal of directors, a majority of the Board consists of individuals who
were not members of the Board two (2) years before such election or removal,
unless the election of each director who was not a director at the beginning of
such 2-year period has been approved in advance by directors representing at
least a majority of the directors then in office who were directors at the
beginning of the 2-year period.


 


2.             “Good Reason” means Optionee’s
termination of employment for any of the following events, unless such event
occurs with Optionee’s express prior written consent:


 


(a)           The assignment to Optionee of any
duties materially inconsistent with, or a material diminution of, his duties
with the Company as in effect immediately prior to the Change of Control of the
Company, except in connection with the termination of Optionee’s employment for
disability, retirement, or Cause or as a result of Optionee’s death or
termination of employment other than for Good Reason;


 


(b)           A reduction of fifteen percent (15%)
or more in Optionee’s base salary as in effect on the date hereof or as the
same may be increased from time to time;


 


(c)           Any material breach by the Company of
any provision of this Option; or


 


(d)           Any failure by the Company to obtain
the assumption of this Option by any successor or assign of the Company.


 


3.             Cause. “Cause” means
termination of Optionee’s employment under any one or more of the following
events:


 


(a)           Optionee’s knowing and willful
misconduct with respect to the business and affairs of the Company;


 


(b)           Any material violation by Optionee of
any policy of the Company relating to ethical conduct or practices or fiduciary
duties of a similarly situated executive;


 

















 


(c)           Knowing and willful material breach
of any provision of this Agreement which is not remedied within thirty (30)
days after Optionee’s receipt of notice thereof;


 


(d)           Optionee’s commission of a felony or
any illegal act involving moral turpitude or fraud or Optionee’s dishonesty
which may reasonably be expected to have a material adverse effect on the
Company; and/or


 


(e)           Failure to comply with reasonable
directives of the Board which are consistent with Optionee’s duties, if not
remedied within thirty (30) days after Optionee’s receipt of notice thereof.


 


11.
Acknowledgements  Optionee acknowledges receipt of a
copy of the Plan and represents that he or she is familiar with the terms and
provisions thereof, and hereby accepts this Option subject to all of the terms
and provisions thereof. Optionee has reviewed the Plan (including any
applicable appendixes or sub-plans thereunder) and this Option Award document
in its entirety has had an opportunity to obtain the advice of counsel prior to
executing this Option and fully understands all provisions of the Option.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Company upon any questions arising under the Plan or
this Option. Optionee further agrees to notify the Company upon any change in
the residence address indicated below.


 


The Company (and not the
Optionee’s employer) is granting the Option. The Company will administer the
Plan from outside Optionee’s country of residence and that United States of
America law along with FEMA and other applicable Indian laws will govern all
Options granted under the Plan.


 


That benefits and rights
provided under the Plan are wholly discretionary and, although provided by the
Company, do not constitute regular or periodic payments. The benefits and
rights provided under the Plan are not to be considered part of Optionee’s
salary or compensation for purposes of calculating any severance, resignation,
redundancy or other end of service payments, vacation, bonuses, long-term
service awards, indemnification, pension or retirement benefits, or any other
payments, benefits or rights of any kind. Optionee waives any and all rights to
compensation or damages as a result of the termination of employment with the
Company for any reason whatsoever insofar as those rights result or may result
from:


 


(i)                                     the
loss or diminution in value of such rights under the Plan, or


 


(ii)                                  Optionee
ceases to have any rights under, or ceases to be entitled to any rights under
the Plan as a result of such termination.


 


The grant of the Option, and
any future grant of Options under the Plan is entirely voluntary, and at the
complete discretion of the Company. Neither the grant of the Option nor any
future grant of an Option by the Company will be deemed to create any
obligation to grant any further Options, whether or not such a reservation is
explicitly stated at the time of such a grant. The Company has the right, at
any time to amend, suspend or terminate the Plan.


 


The Plan will not be deemed to
constitute, and will not be construed by Optionee to constitute, part of the
terms and conditions of employment, and that the Company will not incur any liability
of any kind to Optionee as a result of any change or amendment, or any
cancellation, of the Plan at any time.


 


By entering into this Option
Award document, and as a condition of the grant of the Option, Optionee
consents to the collection, use,


 

















 


and transfer of personal data
as described in this subsection to the full extent permitted by and in full
compliance with applicable laws of India.


 


Optionee understands that the
Company and its Subsidiaries hold certain personal information about the Optionee,
including, but not limited to, name, home address and telephone number, date of
birth, permanent account number, salary, nationality, job title, any Shares or
directorships held in the Company, details of all Options or other entitlement
to Shares awarded, canceled, exercised, vested, unvested, or outstanding in
Optionee’s favor, for the purpose of managing and administering the Plan
(“Data”).


 


Optionee further understands
that the Company and/or its Subsidiaries will transfer Data among themselves as
necessary for the purposes of implementation, administration, and management of
Optionee’s participation in the Plan, and that the Company and/or its
Subsidiary may each further transfer Data to any third parties assisting the
Company in the implementation, administration, and management of the Plan
(“Data Recipients”).


 


Optionee understands that these
Data Recipients may be located in Optionee’s country of residence or elsewhere,
such as the United States. Optionee authorizes the Data Recipients to receive,
possess, use, retain, and transfer Data in electronic or other form, for the
purposes of implementing, administering, and managing Optionee’s participation
in the Plan, including any transfer of such Data, as may be required for the
administration of the Plan and/or the subsequent holding of Shares on
Optionee’s behalf, to a broker or third party with whom the Shares acquired on
exercise may be deposited. Optionee understands that Optionee may, at any time,
review the Data, request that any necessary amendments be made to it, or
withdraw Optionee’s consent herein in writing by contacting the Company.
Optionee further understands that withdrawing consent may affect Optionee’s
ability to participate in the Plan.


 


Optionee has received the terms
and conditions of this Option Award document and any other related
communications, and Optionee consents to having received and understood these
documents and the terms and conditions of the Plan.


 


	
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