Document:

exv10w23

 

EXHIBIT 10.23

	 	 	 
	

	 	CONTRACT OF EMPLOYMENT EFFECTIVE AS OF THE 1st DAY OF January, 2005.

BETWEEN:          TALEO (CANADA) INC., having a place of business at 330
St-Vallier St. East, Suite 400, in the City and District of
Quebec, Province of Quebec, G1K 9C5,

(hereinafter referred to as “TALEO”)

	 	 	 	 	 
	 

	 	AND:
	 	Guy Gauvin
	 

	 	 	 	(hereinafter referred to as the “Employee”)

PRÉAMBULE

          WHEREAS TALEO is actively involved in the area of the development of software;

          WHEREAS the detailed research of TALEO regarding the resolution of management problems
involving recruitment has resulted in the creation and development of a certain software;

          WHEREAS the certain software of TALEO expresses itself through the data programs and technical
documentation regarding the system;

          WHEREAS TALEO possesses a certain technical expertise which is unique and innovative to TALEO
and as such is confidential in nature;

          WHEREAS it is of paramount importance to TALEO that the Employee holds in the strictest of
confidence any and/or all confidential information which he may acquire during his employment with
TALEO;

          WHEREAS TALEO wishes to employ the employee;

          WHEREAS the Employee wishes to be employed by TALEO.

 

 

WHEREFORE THE PARTIES COVENANT AND AGREE AS FOLLOWS:

SECTION 1 – INTERPRETATION

	1.1	 	The division of this Contract of employment into articles and sections, and the use of
section titles is for convenience of reference only and shall not affect the interpretation or
construction of this agreement.

SECTION 2 – TERMS OF EMPLOYMENT

	2.1	 	Subject to the terms and conditions of this Contract of Employment, TALEO agrees to employ
the Employee in the position of Executive Vice President, Global Services. The employee will
report to Taleo’s Chief Executive Offer. Employee will assume and discharge such
responsibilities as are commensurate with such position and as the CEO may direct from time to
time.

	2.2	 	In addition, the Employee shall provide such reasonable services as may, from time to time,
be determined by his/her manager or such other person as TALEO may designate, and shall
provide updates on his/her activities on a regular and timely basis or as requested.

	2.3	 	During the term of employment, the Employee will devote his/her full time, skill and
attention to his/her duties and responsibilities and shall perform faithfully and diligently.

	2.4	 	During the term of employment with TALEO, the Employee will not engage in any other
employment, occupation, consulting, or other business activity directly related to the
business in which TALEO is now involved or becomes involved during the term of employment nor
will the Employee engage in any other activities that conflict with his/her obligations to
TALEO.

	2.5	 	The term of employment between TALEO and the Employee in the position of Executive Vice
President, Global Services shall be for an indeterminate period of time beginning January 1,
2005.

	2.6	 	The Employee may be required to engage in such travel (within Canada and/or abroad) as may be
necessary to adequately perform his/her duties outlined herein.

SECTION 3 – COMPENSATION AND OTHER BENEFITS

	3.1	 	As full compensation for all services provided herein, TALEO will pay, or will cause to be
paid to the Employee, an annual base salary in the amount of $180,000 CAD to be paid in
accordance with TALEO’s standard payroll practices (“Base Salary”).

	3.2	 	In addition to the Base Salary, the Employee is eligible for (1) quarterly bonuses in the
amount of $25,000 CAD per quarter at 100% achievement of goal and based upon achievement of
performance goals approved by Employee’s manager, and (2) an annual bonus in the amount of up
to $40,000 CAD per year at 100% achievement of goal and based upon achievement of performance
goals approved by Employee’s manager.

	3.3	 	TALEO shall be responsible for directly making all payroll deductions as source which may be
due to the appropriate government authorities as well as those deductions related to internal
benefits programs.

	3.4	 	The Employee agrees and authorizes TALEO to make the necessary deductions from his
compensation or any other amount which may be owing in the case of an over payment made to the
Employee.

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	3.5	 	Upon hiring the Employee will be eligible to receive medical and fringe benefits including:
life insurance, disability insurance (short term and long term), healthcare coverage, dental
coverage, home internet access (cable modem or high speed access) in line with Company
programs that may be changed from time to time. Complete details of TALEO benefit plans will
be reviewed with the Employee upon commencement of employment. Taleo reserves the right to
change its benefits programs at any time.

	3.6	 	Upon presentation of appropriate receipts and manager approval, TALEO shall reimburse the
Employee for all ordinary and necessary business expenses as have been reasonably and
necessarily incurred, according to the TALEO’s expense reimbursement policy.

SECTION 4 – VACATION

	4.1	 	The Employee shall be entitled to vacation in accordance with TALEO’s Canadian Annual
Vacation Policy but not in any event less than four (4) weeks of paid annual vacation.

	4.2	 	It is understood and agreed that the Employee must receive prior approval
from TALEO with respect to the scheduling of vacation according to the Annual Vacation Policy.

	4.3	 	The Employee will be entitled to paid days off for the statutory holidays established by
provincial legislation in accordance with provincial law.

SECTION 5 – ABSENCES & HOURS OF WORK

	5.1	 	The minimum work expectation is 40 hours per week.

	5.2	 	It is understood and agreed upon between TALEO and the Employee that the Employee shall not
be entitled to receive any remuneration whatsoever for hours worked in excess 40 hours and
that such work may be expected and obligatory.

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SECTION 6 — TERMINATION OF EMPLOYMENT 

	6.1	 	If Taleo or a successor corporation terminates Employee’s employment for any reason other
than Cause (as defined below) or if Employee resigns for Good Reason (as defined below) then
Taleo or the successor corporation will continue to pay Employee’s Base Salary at the rate in
effect at the time of Employee’s resignation or termination of employment for a period of
twelve (12) months from the date of Employee’s resignation or termination of employment, less
any applicable provincial and federal required withholding amounts, and other lawful
deductions, and Taleo will reimburse employee for any applicable premiums Employee pays for
coverage for Employee and Employee’s eligible dependents for substantially the same health
insurance coverage as provided by the Taleo plan for a period of six (6) months from the date
of Employee’s resignation or termination of employment, or, if earlier, until Employee is
eligible for similar benefits from another employer. However, in the event that Taleo or a
successor corporation terminates Employee’s employment for any reason other than Cause (as
defined below) or if Employee resigns for Good Reason (as defined below) and either such event
takes place within one year of a Change in Control (as defined below), then Taleo or the
successor corporation will continue to pay Employee’s Base Salary and bonuses (at an assumed
100% on-target achievement of goal) at the rate in effect at the time of Employee’s
resignation or termination of employment for a period of twelve (12) months from the date of
Employee’s resignation or termination of employment, less any applicable provincial and
federal required withholding amounts, and other lawful deductions, and Taleo will reimburse
employee for any applicable premiums Employee pays for coverage for Employee and Employee’s
eligible dependents for substantially the same health insurance coverage as provided by the
Taleo plan for a period of six (6) months from the date of Employee’s resignation or
termination of employment, or, if earlier, until Employee is eligible for similar benefits
from another employer. All benefits set forth in this Section 6.1 above are collectively
referred to as “Severance.” In addition to Severance, in the event that Taleo or a successor
corporation terminates Employee’s employment for any reason other than Cause (as defined
below) or if Employee resigns for Good Reason (as defined below), then Employee shall continue
to vest in stock options in accordance with Employee’s then-current stock option grants for a
period of six (6) months from the date of such termination or resignation of employment
(“Vesting Extension”). All options that vested during Employees employment with Taleo or
during the extended vesting period described in the preceding sentence shall expire ninety
(90) days after the expiration of the extended vesting period. Payment of Severance and
Vesting Extension shall be contingent upon Employee’s execution of a separation agreement
releasing Taleo from any claim Employee may have against Taleo and from any liability, damages
or payments other than earned compensation due to Employee through Employee’s date of
resignation or termination pursuant to Taleo’s standard payroll procedures and the Severance
and Vesting Extension obligations described above and containing standard non-competition
provisions consistent with this Agreement. Severance will be paid in accordance with Taleo’s
standard payroll procedures.

	6.2	 	For purposes of this Section 6, “Cause” means (i) any act of personal dishonesty taken by
Employee in connection with Employee’s employment responsibilities, (ii) Employee’s conviction
of a felony, (iii) any act by Employee that constitutes material misconduct, (iv) repeated
failures to follow the lawful, reasonable instructions of the CEO, or (v) substantial
violations of employment or fiduciary duties, responsibilities or obligations to Taleo.

	6.3	 	For purposes of this Section 6, “Good Reason” means (i) without Employee’s consent, a
significant reduction of Employee’s duties, position or responsibilities relative to
Employee’s duties, position or responsibilities in effect immediately prior to such reduction,
other than a reduction where Employee are asked to assume substantially similar duties and
responsibilities in a division of a larger entity after a Change in Control; (ii) without
Employee’s consent, a reduction of Employee’s Base Salary other than a one-time reduction that
does not exceed twenty percent (20%) and that is also applied to substantially all of Taleo’s
senior executives; (iii) without Employee’s consent, Employee’s relocation to a facility or a
location greater than thirty miles from Quebec City, Canada. If Employee does not notify
Taleo in writing that Employee believes a significant reduction of his duties, position or
responsibilities has occurred pursuant to Section 6.3(i) within thirty days of the event or
occurrence that Employee believes to have resulted in such a significant reduction, then such
reduction shall be deemed for purposes of this Agreement as not constituting Good Reason, as
that terms is used in Section 6.1 above.

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	6.4	 	For purposes of this Section 6, “Change in Control” means the occurrence of any of the
following events: (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act),
directly or indirectly, of securities of the Taleo representing fifty percent (50%) or more of
the total voting power represented by the Taleo’s then outstanding voting securities and such
change in ownership results in a broad management changes at Taleo; or (ii) the consummation
of the sale or disposition by Taleo of all or substantially all of Taleo’s assets; or (iii)
the consummation of a merger or consolidation of Taleo with any other corporation, other than
a merger or consolidation which would result in the voting securities of Taleo outstanding
immediately prior thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or its parent) more than fifty
percent (50%) of the total voting power represented by the voting securities of Taleo or such
surviving entity or its parent outstanding immediately after such merger or consolidation.

	6.5	 	Notwithstanding the above, Taleo’s Chief Executive Officer reserves the right to make
reasonable organizational structure changes reasonably commensurate with the position of Chief
Executive Officer. Such changes may include the shifting or reassignment of divisional,
geographic or team responsibilities among members of the executive team. Such changes are
within the reasonable discretion of the Chief Executive Officer and shall not constitute Good
Reason, as that term is used in 6.1 or 6.3 above.

	6.6	 	The Employee shall provide TALEO with a prior written notice of at least one (1) month in the
event that the Employee intends to cease employment with TALEO and the Employee further agrees
that he shall not leave the employ of TALEO for one (1) month following the notification by
the Employee, the whole subject to TALEO allowing the Employee to leave earlier. Employee
agrees to inform Taleo of the name of Employee’s next employer within five (5) business days
of accepting employment.

SECTION 7 — COVENANTS NOT TO COMPETE AND SOLICIT

	7.1	 	While the Employee is employed by TALEO hereunder, the Employee shall not be engaged in any
other business, occupation, or undertaking which is competitive with the business of TALEO.

	7.2	 	In consideration of this Agreement, the compensation to be paid to Employee, and in further
consideration of the stock options granted to Employee under a separate Agreement, while the
Employee is employed by TALEO hereunder and for a period of twelve (12) months thereafter, the
Employee agrees not to engage, directly or indirectly, in any Canadian province or US state in
which Taleo conducts substantial business as evidenced by, for example, customers in such
province or state and/or marketing and sales efforts via a direct sales force in such province
or state, in any business which is competitive with the business now conducted by TALEO or
those which may be conducted by TALEO during the Employee’s employment hereunder. For the
purposes of this paragraph, the Employee will be directly or indirectly engaged in a business,
if he is engaged in a business as proprietor, partner, joint venturer, stockholder, director,
officer, lender, manager, employee, consultant, temporary worker, advisor or agent, or if he
otherwise controls, is engaged in or permits his/her name to be used by or associated with
such business, provided that the Employee may hold up to one percent (1%) of the stock of any
publicly traded company.

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	7.3	 	It is recognized and understood by the parties that the employees of TALEO are an integral
part of TALEO‘s business and that it is extremely important for TALEO to use its maximum
efforts to prevent TALEO from losing those employees. It is therefore understood and agreed by
the parties that, because of the nature of the business of TALEO, it is necessary to afford
fair protection to TALEO from the loss of any employees. Consequently, as a material
inducement to TALEO to employ the Employee, the Employee covenants and agrees that, for the
period commencing on the date of the Employee’s termination of employment, for any reason
whatsoever, and ending twelve (12) months after the Employee’s termination of employment with
TALEO, the Employee shall not, directly or indirectly, hire or engage or attempt to hire or
engage any individual who shall have been an employee of TALEO at any time during the twelve
(12) months period prior to the date of the Employee’s termination of employment with TALEO,
whether for or on behalf of the Employee or for any entity in which the Employee shall have a
direct or indirect interest or any subsidiary or affiliate of any entity, whether as a
proprietor, partner, co-venturer, financier, investor or stockholder, director, officer,
employer, employee, servant, agent, representative or otherwise.

	7.4	 	The Employee acknowledges to TALEO that he has and will continue to receive the value and
advantage of special training and skills and expert knowledge about, and expertise in, certain
areas of TALEO’s business and that he will have knowledge of, and contact with customers and
suppliers of TALEO and other TALEO employees who are engaged in the business of TALEO. He
further acknowledges to TALEO that he may well be able to utilize the knowledge and expertise,
following the termination of his/her service with TALEO, to the serious detriment of TALEO in
the event that he should elect to solicit orders on behalf of a competitor of TALEO from
TALEO‘s customers, or interfere with suppliers to TALEO. Accordingly, for a period of twelve
(12) months after the termination of his/her service with TALEO (however and for whatever
reason the termination occurs), he agrees that he will not within Canada or the US:

	 	a)	 	solicit orders for any article similar to or
capable of being used in place of the goods from any person, firm
or company residing or carrying on business within the area to
whom TALEO has supplied goods at any time during the twelve (12)
months preceding the termination;
	 
	 	b)	 	supply the articles described in (a) above to any
person, firm or company described in (a) above.

In this clause “goods” means the articles and/or services distributed or sold by TALEO.

	7.5	 	The Employee acknowledges to TALEO that he has acquired and shall acquire information about
certain matters and things which are confidential and the exclusive property of TALEO and
which are not accessible to the general public, including but not limited to product design,
product roadmaps, future product plans, contractual details relating to current TALEO clients,
names and addresses and buying habits of present and prospective clients of TALEO, pricing and
sales policy, techniques and concepts, trade secrets and other confidential information
concerning the business operations of TALEO or any company and/or entity affiliated with
TALEO. Accordingly, for a period of twelve (12) months after the termination of his/her
employment with TALEO (however and for whatever reason the termination occurs), he agrees that
he will not within the Province of Quebec either alone or in association with other, solicit,
divert or take away, or attempt to divert or take away, the business or patronage of any of
the clients, customers or accounts, or prospective clients, customers or accounts, of TALEO
which were contacted, solicited or served, directly or indirectly, by the Employee while
employed by TALEO.

	7.6	 	The Employee acknowledges and agrees that he has read and understands the provisions hereof
and is satisfied that they are both necessary and reasonable. The Employee further
acknowledges that it is a condition precedent to the entering into of this Contract of
Employment that he bind himself/herself to these Covenants Not To Compete And To Solicit. The
Employee hereby furthermore acknowledges that the full observance of these Covenants Not To
Compete And To Solicit will not, in any way, prevent the Employee from earning his/her
livelihood.

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	 	 	The parties agree that any breach by the Employee of the covenants contained herein will
result in irreparable injury to TALEO for which money damages could not adequately
compensate. Upon any such breach, or threatened breach, TALEO shall be entitled (in addition
to any other rights and remedies which it may have at law or in equity) to seek an
injunction enjoining and restraining Employee and/or any other person involved therein from
continuing such breach.
	 
	7.7	 	In the event that any of the provisions of this Section 7 of this Contract of Employment
shall be held to be invalid or unenforceable by a competent court, by reason of geographic or
business scope or the duration thereof, the parties hereto acknowledge and agree that the said
court of competent jurisdiction shall have the right and authority to redefine the geographic
or business scope or the duration of these Covenants Not To Compete And To Solicit in order to
give full force and effect to same in its redefined scope. Moreover, in the event that any
court of competent jurisdiction refuses to modify the said covenants, any invalidity or
unenforceability arising there from shall attach only to such a provision and shall not effect
or render invalid or unenforceable any other provisions of this Contract of Employment.

SECTION 8 – NONDISCLOSURE, NON-USE & IP ASSIGNMENT

	8.1	 	Confidentiality. The Employee will not, at any time, whether during or subsequent to
his/her employment hereunder, directly or indirectly, disclose or furnish to any other person,
firm or corporation, or use on behalf of himself/herself or any other person, firm or
corporation, any confidential or proprietary information acquired by the Employee in the
course of his/her employment with TALEO, including, without limiting the generality of the
foregoing, product design, product roadmaps, future product plans, contractual details
relating to current TALEO clients, buying habits of present and prospective clients of TALEO,
pricing and sales policy, techniques and concepts, the names of customers or prospective
customers of TALEO or of any person, firm or corporation who or which have or shall have
treated or dealt with TALEO or any of its subsidiaries or affiliated companies, any other
information acquired by the Employee regarding the methods of conducting the business of TALEO
and any of its subsidiaries and/or affiliates, any information regarding the company’s methods
of research and development, of obtaining business, of manufacturing, of providing or
advertising products or services, or of obtaining customers, trade secrets and other
confidential information concerning the business operations of TALEO or any company and/or
entity affiliated with TALEO, except to the extent that such information is already generally
known in the public domain.

	8.2	 	Former Employer Information. Employee agrees, during employment with TALEO, not to
improperly use or disclose any proprietary information or trade secrets of any former or
concurrent employer or other person or entity and that Employee will not bring onto the
premises of TALEO any unpublished document or proprietary information belonging to any such
employer, person or entity unless consented to in writing by such employer, person or entity.

	8.3	 	Third Party Information. Employee recognizes that TALEO has received and in the
future will receive from third parties their confidential or proprietary information subject
to a duty on TALEO’s part to maintain the confidentiality of such information and to use it
only for certain limited purposes. Employee agrees to hold all such confidential or
proprietary information in the strictest confidence and not to disclose it to any person, firm
or corporation or to use it except as necessary in carrying out work for the TALEO consistent
with TALEO’s agreement with such third party.

	8.4	 	Assignment of Inventions. Employee agrees to promptly make full written
disclosure to TALEO, will hold in trust for the sole right and benefit of the TALEO and hereby
assigns to the TALEO, or its designee, all right, title and interest in and to any and all
inventions, original works of authorship, developments, concepts, improvements, or trade
secrets, whether or not patentable or registrable under copyright or similar laws, which
Employee may solely or jointly conceive or develop or reduce to practice, or cause to be
conceived or developed or reduced to practice, during the period of time Employee is in the
employ of TALEO (collectively referred to as “Inventions”). Employee further acknowledges
that all original works of authorship which are made by Employee (solely or jointly with
others) within the scope of and during the period of Employee’s employment with TALEO and
which are protectible by copyright are “works made for hire” as that term is defined in the
relevant copyright act.

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	8.5	 	Inventions Retained and Licensed. Employee has attached hereto, as Exhibit B, a
list of all inventions, original works of authorship, developments, improvements, and trade
secrets which were made by me prior to my employment with TALEO (collectively referred to as
“Prior Inventions”), which belong to Employee, which relate to TALEO’s proposed business,
products or research and development, and which are not assigned to TALEO hereunder; or, if no
such list is attached, Employee represents that there are no such Prior Inventions. If in the
course of Employee’s employment with TALEO, Employee incorporates into a TALEO product,
process or machine a Prior Invention owned by Employee or in which Employee has an interest,
TALEO is hereby granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual,
worldwide license to make, have made, modify, use, and sell such Prior Invention as part of or
in connection with such product, process or machine.

	8.6	 	Maintenance of Records. Employee agrees to keep and maintain adequate and current
written records of all Inventions made by Employee (solely or jointly with others) during the
term of my employment with TALEO. The records will be in the form of notes, sketches,
drawings, and any other format that may be specified by TALEO. The records will be available
to and remain the sole property of TALEO at all times.

	8.7	 	Patent and Copyright Registrations. Employee agrees to assist TALEO, or its
designee, at TALEO’s expense, in every proper way to secure TALEO’s rights in the Inventions
and any copyrights, patents, mask work rights or other intellectual property rights relating
thereto in any and all countries, including the disclosure to TALEO of all pertinent
information and data with respect thereto, the execution of all applications, specifications,
oaths, assignments and all other instruments which TALEO shall deem necessary in order to
apply for and obtain such rights and in order to assign and convey to TALEO, its successors,
assigns, and nominees the sole and exclusive rights, title and interest in and to such
Inventions, and any copyrights, patents, mask work rights or other intellectual property
rights relating thereto. Employee further agrees that Employee’s obligation to execute or
cause to be executed, when it is in Employee’s power to do so, any such instrument or papers
shall continue after the termination of this Agreement. If TALEO is unable because of
Employee’s mental or physical incapacity or for any other reason to secure Employee’s
signature to apply for or to pursue any application for any Canadian or foreign patents or
copyright registrations covering Inventions or original works of authorship assigned to TALEO
as above, then Employee hereby irrevocably designate and appoint TALEO and its duly authorized
officers and agents as Employee’s agent and attorney in fact, to act for and in Employee’s
behalf and stead to execute and file any such applications and to do all other lawfully
permitted acts to further the prosecution and issuance of letters patent or copyright
registrations thereon with the same legal force and effect as if executed by Employee.

	8.8	 	Return of Company Documents. Employee agrees that, at the time of leaving the employ
of TALEO, Employee will deliver to TALEO (and will not keep in my possession, recreate or
deliver to anyone else) any and all devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings blueprints, sketches, materials, equipment, other
documents or property, or reproductions of any aforementioned items developed by me pursuant
to Employee’s employment with TALEO or otherwise belonging to TALEO, its successors or
assigns.

SECTION 9 – GENERAL PROVISIONS

	9.1	 	The Employee authorizes TALEO to deduct from any payment due to the Employee at any time,
including a termination payment, any amounts owed to TALEO by reason of purchases, advances,
loans or in recompense for damage to or loss of TALEO‘s property or in recompense for damage
to TALEO as a result of the Employee’s breach of any term of the present Contract of
Employment, save only that this provision shall be applied so as not to conflict with any
applicable legislation.
	 
	9.2	 	The provisions of this Contract of Employment shall be governed and interpreted in
accordance with the laws of the Province of Quebec.
	 
	9.3	 	Employee agrees to comply with the Taleo code of conduct set forth at Exhibit A.
	 
	9.4	 	The waiver by TALEO of any breach of any provision of this Contract of Employment by the
Employee shall not operate or be construed as a waiver of any subsequent breach by the
Employee.

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	9.5	 	This Contract of Employment constitutes the entire agreement between the parties with respect
to the employment of the Employee and any and/or all previous agreements, written or oral,
express or implied between the parties or on their behalf relating to the employment of the
Employee by TALEO are terminated and cancelled and each of the parties releases and forever
discharges the other of and from all manner of actions, causes of action, claims and demands
whatsoever under or in respect of any such agreement.
	 
	9.6	 	Any modification to this Contract of Employment must be in writing and signed by the parties,
or it shall have no effect and shall be void.
	 
	9.7	 	In the event that any provision in this Contract of Employment shall be deemed void or
invalid by a Court of competent jurisdiction, the remaining provisions shall be and remain in
full force and effect.
	 
	9.8	 	The rights which accrue to TALEO under this Contract of Employment shall pass to its
successors or assigns. The rights of the Employee under this Contract of Employment are not
assignable or transferable in any manner.
	 
	9.9	 	The Employee acknowledges that he has read and understands this Contract of Employment, and
further acknowledges that he has had the opportunity to obtain independent legal advice with
respect to it.
	 
	9.10	 	This Agreement may be executed in counterparts and may be exchanged by facsimile or
electronically scanned and emailed copy. Each such counterpart shall be deemed to be an
original and all such counterparts together shall constitute one and the same Agreement.

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	9.11	 	The parties hereto have requested that this Contract of Employment be drafted in the English
language. Les parties aux présentes ont demandé à ce que le présent Contrat
d’Emploi soit rédigé en anglais.

IN WITNESS WHEREOF, THE PARTIES HERETO HAVE SIGNED THIS AGREEMENT AT THE CITY OF QUEBEC, PROVINCE
OF QUEBEC, THIS 17th DAY OF AUGUST 2005.

	 	 	 
	/s/ Josh Faddis

	 	/s/ Guy Gauvin
	 

	 	 
	TALEO (CANADA) INC.

	 	Signature of Employee
	(Signature of Authorized Representative)
	 	 

10exv10w24

 

EXHIBIT 10.24

TALEO CORPORATION

2005 STOCK PLAN

     1. Purposes of the Plan. The purposes of this Plan are to attract and retain the best
available personnel for positions of substantial responsibility, to provide additional incentive to
Employees, Directors and Consultants and to promote the success of the Company’s business. Options
granted under the Plan shall be Nonstatutory Stock Options.

     2. Definitions. As used herein, the following definitions shall apply:

          (a) “Administrator” means the Board or any of its Committees as shall be administering
the Plan in accordance with Section 4 hereof.

          (b) “Applicable Laws” means the requirements relating to the administration of stock
option plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any
stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable
laws of any other country or jurisdiction where Options are granted under the Plan.

          (c) “Board” means the Board of Directors of the Company.

          (d) “Change in Control” means the occurrence of any of the following events:

               (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the total
voting power represented by the Company’s then outstanding voting securities, except that any
change in the beneficial ownership of the securities of the Company as a result of a private
financing of the Company that is approved by the Board, shall not be deemed to be a Change in
Control; or

               (ii) The consummation of the sale or disposition by the Company of all or substantially all of
the Company’s assets; or

               (iii) The consummation of a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or
by being converted into voting securities of the surviving entity or its parent) at least fifty
percent (50%) of the total voting power represented by the voting securities of the Company or such
surviving entity or its parent outstanding immediately after such merger or consolidation.

          (e) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a
section of the Code herein will be a reference to any successor or amended section of the Code.

 

 

          (f) “Committee” means a committee of Directors or of other individuals satisfying
Applicable Laws appointed by the Board in accordance with Section 4 hereof.

          (g) “Common Stock” means the Common Stock of the Company.

          (h) “Company” means Taleo Corporation, a Delaware corporation.

          (i) “Consultant” means any person who is engaged by the Company or any Parent or
Subsidiary to render consulting or advisory services to such entity.

          (j) “Director” means a member of the Board.

          (k) “Disability” means total and permanent disability as defined in Section 22(e)(3)
of the Code.

          (l) “Employee” means any person, including officers and Directors, employed by the
Company or any Parent or Subsidiary of the Company. Neither service as a Director nor payment of a
director’s fee by the Company shall be sufficient to constitute “employment” by the Company.

          (m) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          (n) “Exchange Program” means a program under which (a) outstanding Options are
surrendered or cancelled in exchange for Options of the same type (which may have lower exercise
prices and different terms), Options of a different type, and/or cash, and/or (b) the exercise
price of an outstanding Option is reduced. The terms and conditions of any Exchange Program will
be determined by the Administrator in its sole discretion.

          (o) “Fair Market Value” means, as of any date, the value of Common Stock determined as
follows:

               (i) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of
The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or
the closing bid, if no sales were reported) as quoted on such exchange or system on the day of
determination, as reported in The Wall Street Journal or such other source as the Administrator
deems reliable;

               (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling
prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked
prices for the Common Stock on the day of determination; or

               (iii) In the absence of an established market for the Common Stock, the Fair Market Value
thereof shall be determined in good faith by the Administrator.

          (p) “Nonstatutory Stock Option” means an Option not intended to qualify as an
Incentive Stock Option within the meaning of Section 422 of the Code.

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          (q) “Option” means a stock option granted pursuant to the Plan.

          (r) “Option Agreement” means a written or electronic agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant. The Option
Agreement is subject to the terms and conditions of the Plan.

          (s) “Optioned Stock” means the Common Stock subject to an Option.

          (t) “Optionee” means the holder of an outstanding Option granted under the Plan.

          (u) “Parent” means a “parent corporation,” whether now or hereafter existing, as
defined in Section 424(e) of the Code.

          (v) “Plan” means this 2005 Stock Plan.

          (w) “Service Provider” means an Employee, Director or Consultant.

          (x) “Share” means a share of the Common Stock, as adjusted in accordance with Section
12 below.

          (y) “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing,
as defined in Section 424(f) of the Code.

     3. Stock Subject to the Plan. Subject to the provisions of Section 12 of the Plan,
the maximum aggregate number of Shares that may be subject to Options and sold under the Plan is
400,000 Shares. The Shares may be authorized but unissued, or reacquired Common Stock.

          If an Option expires or becomes unexercisable without having been exercised in full, or is
surrendered pursuant to an Exchange Program, the unpurchased Shares that were subject thereto shall
become available for future grant or sale under the Plan (unless the Plan has terminated).
However, Shares that have actually been issued under the Plan, upon exercise of either an Option,
shall not be returned to the Plan and shall not become available for future distribution under the
Plan.

     4. Administration of the Plan.

          (a) Administrator. The Plan shall be administered by the Board or a Committee
appointed by the Board, which Committee shall be constituted to comply with Applicable Laws.

          (b) Powers of the Administrator. Subject to the provisions of the Plan and, in the
case of a Committee, the specific duties delegated by the Board to such Committee, and subject to
the approval of any relevant authorities, the Administrator shall have the authority in its
discretion:

               (i) to determine the Fair Market Value;

               (ii) to select the Service Providers to whom Options may from time to time be granted
hereunder;

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               (iii) to determine the number of Shares to be covered by each such award granted hereunder;

               (iv) to approve forms of agreement for use under the Plan;

               (v) to determine the terms and conditions of any Option granted hereunder. Such terms and
conditions include, but are not limited to, the exercise price, the time or times when Options may
be exercised (which may be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option or the Common Stock
relating thereto, based in each case on such factors as the Administrator, in its sole discretion,
shall determine;

               (vi) to institute an Exchange Program;

               (vii) to prescribe, amend and rescind rules and regulations relating to the Plan, including
rules and regulations relating to sub-plans established for the purpose of satisfying applicable
foreign laws;

               (viii) to allow Optionees to satisfy withholding tax obligations by electing to have the
Company withhold from the Shares to be issued upon exercise of an Option that number of Shares
having a Fair Market Value equal to the minimum amount required to be withheld. The Fair Market
Value of the Shares to be withheld shall be determined on the date that the amount of tax to be
withheld is to be determined. All elections by Optionees to have Shares withheld for this purpose
shall be made in such form and under such conditions as the Administrator may deem necessary or
advisable; and

               (ix) to construe and interpret the terms of the Plan and Options granted pursuant to the Plan.

          (c) Effect of Administrator’s Decision. All decisions, determinations and
interpretations of the Administrator shall be final and binding on all Optionees.

     5. Eligibility. Nonstatutory Stock Options may be granted to Service Providers.

     6. Limitations.

          (a) Designation. Each Option will be designated a Nonstatutory Stock Option.

          (b) At-Will Employment. Neither the Plan nor any Option shall confer upon any
Optionee any right with respect to continuing the Optionee’s relationship as a Service Provider
with the Company, nor shall it interfere in any way with his or her right or the Company’s right to
terminate such relationship at any time, with or without cause, and with or without notice.

     7. Term of Plan. The Plan shall become effective upon its adoption by the Board.
Unless sooner terminated under Section 14, it shall continue in effect for a term of ten (10) years
from the later of (i) the effective date of the Plan, or (ii) the earlier of the most recent Board
approval of an increase in the number of Shares reserved for issuance under the Plan.

-4-

 

     8. Term of Option. The term of each Option shall be stated in the Option Agreement;
provided, however, that the term shall be no more than ten (10) years from the date of grant
thereof.

     9. Option Exercise Price and Consideration.

          (a) Exercise Price. The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Administrator, but shall be no
less than 100% of the Fair Market Value per Share on the date of grant.

          (b) Forms of Consideration. The consideration to be paid for the Shares to be issued
upon exercise of an Option, including the method of payment, shall be determined by the
Administrator. Such consideration may consist of, without limitation, (1) cash, (2) check, (3)
promissory note, (4) other Shares, provided Shares acquired directly from the Company (x) have been
owned by the Optionee, and not subject to a substantial risk of forfeiture, for more than six
months on the date of surrender, and (y) have a Fair Market Value on the date of surrender equal to
the aggregate exercise price of the Shares as to which such Option shall be exercised, (5)
consideration received by the Company under a cashless exercise program implemented by the Company
in connection with the Plan, or (6) any combination of the foregoing methods of payment. In making
its determination as to the type of consideration to accept, the Administrator shall consider if
acceptance of such consideration may be reasonably expected to benefit the Company.

     10. Exercise of Option.

          (a) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder
shall be exercisable according to the terms hereof at such times and under such conditions as
determined by the Administrator and set forth in the Option Agreement. An Option may not be
exercised for a fraction of a Share.

               An Option shall be deemed exercised when the Company receives: (i) written or electronic
notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise
the Option, and (ii) full payment for the Shares with respect to which the Option is exercised.
Full payment may consist of any consideration and method of payment authorized by the Administrator
and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall
be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee
and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the Company), no right to vote or
receive dividends or any other rights as a stockholder shall exist with respect to the Shares,
notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such
Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other
right for which the record date is prior to the date the Shares are issued, except as provided in
Section 12 of the Plan.

               Exercise of an Option in any manner shall result in a decrease in the number of Shares
thereafter available, both for purposes of the Plan and for sale under the Option, by the number of
Shares as to which the Option is exercised.

          (b) Termination of Relationship as a Service Provider. If an Optionee ceases to be a
Service Provider, such Optionee may exercise his or her Option within such period of time as is

-5-

 

specified in the Option Agreement to the extent that the Option is vested on the date of
termination (but in no event later than the expiration of the term of the Option as set forth in
the Option Agreement). In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for three (3) months following the Optionee’s termination. Unless the
Administrator provides otherwise, if on the date of termination the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to
the Plan. If, after termination, the Optionee does not exercise his or her Option within the time
specified by the Administrator, the Option shall terminate, and the Shares covered by such Option
shall revert to the Plan.

          (c) Disability of Optionee. If an Optionee ceases to be a Service Provider as a
result of the Optionee’s Disability, the Optionee may exercise his or her Option within such period
of time as is specified in the Option Agreement to the extent the Option is vested on the date of
termination (but in no event later than the expiration of the term of such Option as set forth in
the Option Agreement). In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for twelve (12) months following the Optionee’s termination. Unless the
Administrator provides otherwise, if on the date of termination the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to
the Plan. If, after termination, the Optionee does not exercise his or her Option within the time
specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to
the Plan.

          (d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may
be exercised within such period of time as is specified in the Option Agreement (but in no event
later than the expiration of the term of such Option as set forth in the Option Agreement), by the
Optionee’s designated beneficiary, provided such beneficiary has been designated prior to
Optionee’s death in a form acceptable to the Administrator. If no such beneficiary has been
designated by the Optionee, then such Option may be exercised by the personal representative of the
Optionee’s estate or by the person(s) to whom the Option is transferred pursuant to the Optionee’s
will or in accordance with the laws of descent and distribution. In the absence of a specified
time in the Option Agreement, the Option shall remain exercisable for twelve (12) months following
the Optionee’s termination. If, at the time of death, the Optionee is not vested as to his or her
entire Option, the Shares covered by the unvested portion of the Option shall immediately revert to
the Plan. If the Option is not so exercised within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

          (e) Leaves of Absence.

               (i) Unless the Administrator provides otherwise, vesting of Options granted hereunder shall be
suspended during any unpaid leave of absence.

               (ii) A Service Provider shall not cease to be an Employee in the case of (A) any leave of
absence approved by the Company or (B) transfers between locations of the Company or between the
Company, its Parent, any Subsidiary, or any successor.

     11. Transferability of Options. Unless determined otherwise by the Administrator,
Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner

-6-

 

other than by will or the laws of descent and distribution, and may be exercised during the
lifetime of the Optionee, only by the Optionee.

     12. Adjustments; Dissolution or Liquidation; Merger or Change in Control.

          (a) Adjustments. In the event that any dividend or other distribution (whether in the
form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or
exchange of Shares or other securities of the Company, or other change in the corporate structure
of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or
enlargement of the benefits or potential benefits intended to be made available under the Plan, may
(in its sole discretion) adjust the number and class of Shares that may be delivered under the Plan
and/or the number, class, and price of Shares covered by each outstanding Option.

          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable
prior to the effective date of such proposed transaction. To the extent it has not been previously
exercised, an Option will terminate immediately prior to the consummation of such proposed action.

          (c) Merger or Change in Control. In the event of a merger of the Company with or into
another corporation, or a Change in Control, each outstanding Option shall be assumed or an
equivalent option substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event that the successor corporation in a merger or Change in
Control refuses to assume or substitute for the Option, then the Optionee shall fully vest in and
have the right to exercise the Option as to all of the Optioned Stock, including Shares as to which
it would not otherwise be vested or exercisable. If an Option becomes fully vested and exercisable
in lieu of assumption or substitution in the event of a merger or Change in Control, the
Administrator shall notify the Optionee in writing or electronically that the Option shall be fully
exercisable for a period of time as determined by the Administrator, and the Option shall terminate
upon expiration of such period. For the purposes of this paragraph, the Option shall be considered
assumed if, following the merger or Change in Control, the option or right confers the right to
purchase or receive, for each Share subject to the Option immediately prior to the merger or Change
in Control, the consideration (whether stock, cash, or other securities or property) received in
the merger or Change in Control by holders of Common Stock 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 in the merger or Change in Control is not solely common stock
of the successor corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon the exercise of the
Option, for each Share subject to the Option, to be solely common stock of the successor
corporation or its Parent equal in fair market value to the per share consideration received by
holders of common stock in the merger or Change in Control.

     13. Time of Granting Options. The date of grant of an Option shall, for all purposes,
be the date on which the Administrator makes the determination granting such Option, or such later
date as is determined by the Administrator. Notice of the determination shall be given to each
Service Provider to whom an Option is so granted within a reasonable time after the date of such
grant.

-7-

 

     14. Amendment and Termination of the Plan.

          (a) Amendment and Termination. The Board may at any time amend, alter, suspend or
terminate the Plan.

          (b) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise
between the Optionee and the Administrator, which agreement must be in writing and signed by the
Optionee and the Company. Termination of the Plan shall not affect the Administrator’s ability to
exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to
the date of such termination.

     15. Conditions Upon Issuance of Shares.

          (a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an
Option unless the exercise of such Option and the issuance and delivery of such Shares shall comply
with Applicable Laws and shall be further subject to the approval of counsel for the Company with
respect to such compliance.

          (b) Investment Representations. As a condition to the exercise of an Option, the
Administrator may require the person exercising such Option to represent and warrant at the time of
any such exercise that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.

     16. Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

     17. Reservation of Shares. The Company, during the term of this Plan, shall at all
times reserve and keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.

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TALEO CORPORATION

2005 STOCK PLAN

STOCK OPTION AGREEMENT

     Unless otherwise defined herein, the terms defined in the 2005 Stock Plan shall have the same
defined meanings in this Stock Option Agreement.

1. NOTICE OF STOCK OPTION GRANT

     Name:

     Address:

     The undersigned Optionee has been granted an Option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as follows:

	 	 	 	 	 
	     Date of Grant
	 	 	 	 
	 

	 	 	 	 
	 
	     Vesting Commencement Date
	 	 	 	 
	 

	 	 	 	 
	 
	     Exercise Price per Share

	 	$

	 

	 	 	 	 
	 
	     Total Number of Shares Granted
	 	 	 	 
	 

	 	 	 	 
	 
	     Total Exercise Price

	 	$	 	 
	 

	 	 	 	 
	 
	 

	 	[The exercise price should be at least 100% of Fair
Market Value per Share on the date of grant.]

	 
	     Type of Option:

	 	Nonstatutory Stock Option

	 
	     Term/Expiration Date:
	 	 	 	 
	 

	 	 	 	 

     Vesting Schedule:

     This Option shall be exercisable, in whole or in part, according to the following vesting
schedule:

     [Twenty-five percent (25%) of the Shares subject to the Option shall vest on the one (1) year
anniversary of the Vesting Commencement Date, and 1/48 of the Shares subject to the Option shall
vest each month thereafter on the same day of the month as the Vesting Commencement Date, subject
to Optionee continuing to be a Service Provider through each such date.]

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     Termination Period:

     This Option shall be exercisable for ninety (90) days after Optionee ceases to be a Service
Provider. Upon Optionee’s death or Disability, this Option may be exercised for one (1) year after
Optionee ceases to be a Service Provider. In no event may Optionee exercise this Option after the
Term/Expiration Date as provided above.

2. AGREEMENT

     (a) Grant of Option. The Plan Administrator of the Company hereby grants to the
Optionee named in the Notice of Grant (the “Optionee”), an option (the “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 (the “Exercise Price”), and subject to the terms and conditions of the Plan, which
is incorporated herein by reference. Subject to Section 14(b) of the Plan, in the event of a
conflict between the terms and conditions of the Plan and this Option Agreement, the terms and
conditions of the Plan shall prevail.

     (b) Exercise of Option.

          (i) Right to Exercise. This Option shall be exercisable during its term in accordance
with the Vesting Schedule set out in the Notice of Grant and with the applicable provisions of the
Plan and this Option Agreement.

          (ii) Method of Exercise. This Option shall be exercisable by delivery of an exercise
notice in the form attached as Exhibit A (the “Exercise Notice”) which shall state the
election to exercise the Option, the number of Shares with respect to which the Option is being
exercised, and such other representations and agreements as may be required by the Company. The
Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully
executed Exercise Notice accompanied by the aggregate Exercise Price.

               No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such
exercise comply with Applicable Laws. Assuming such compliance, for income tax purposes the Shares
shall be considered transferred to the Optionee on the date on which the Option is exercised with
respect to such Shares.

     (c) Optionee’s Representations. In the event the Shares have not been registered
under the Securities Act of 1933, as amended, at the time this Option is exercised, the Optionee
shall, if required by the Company, concurrently with the exercise of all or any portion of this
Option, deliver to the Company his or her Investment Representation Statement in the form attached
hereto as Exhibit B.

     (d) Lock-Up Period. Optionee hereby agrees that Optionee shall not offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any Common Stock (or other securities) of the Company or enter into any
swap, hedging or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of any Common Stock (or other securities) of the Company held by
Optionee (other

-10-

 

than those included in the registration) for a period specified by the representative of the
underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty
(180) days following the effective date of any registration statement of the Company filed under
the Securities Act.

               Optionee agrees to execute and deliver such other agreements as may be reasonably requested by
the Company or the underwriter which are consistent with the foregoing or which are necessary to
give further effect thereto. In addition, if requested by the Company or the representative of the
underwriters of Common Stock (or other securities) of the Company, Optionee shall provide, within
ten (10) days of such request, such information as may be required by the Company or such
representative in connection with the completion of any public offering of the Company’s securities
pursuant to a registration statement filed under the Securities Act. The obligations described in
this Section 4 shall not apply to a registration relating solely to employee benefit plans on Form
S-1 or Form S-8 or similar forms that may be promulgated in the future, or a registration relating
solely to a Commission Rule 145 transaction on Form S-4 or similar forms that may be promulgated in
the future. The Company may impose stop-transfer instructions with respect to the shares of Common
Stock (or other securities) subject to the foregoing restriction until the end of said one hundred
eighty (180) day period. Optionee agrees that any transferee of the Option or shares acquired
pursuant to the Option shall be bound by this Section 4.

     (e) Method of Payment. Payment of the aggregate Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee:

          (i) cash or check;

          (ii) consideration received by the Company under a formal cashless exercise program adopted by
the Company in connection with the Plan; or

          (iii) surrender of other Shares which (i) meet the conditions established by the Administrator
to avoid adverse accounting consequences (as determined by the Administrator), and (ii) have a Fair
Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised
Shares.

     (f) Restrictions on Exercise. This Option may not be exercised if the issuance of
such Shares upon such exercise or the method of payment of consideration for such shares would
constitute a violation of any Applicable Law.

     (g) Non-Transferability of Option. This Option may not be transferred in any manner
otherwise than by will or by the laws of descent or distribution and may be exercised during the
lifetime of Optionee only by Optionee. The terms of the Plan and this Option Agreement shall be
binding upon the executors, administrators, heirs, successors and assigns of the Optionee.

     (h) Term of Option. This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with the Plan and the
terms of this Option.

     (i) Tax Obligations. Optionee agrees to make appropriate arrangements with the
Company (or the Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all
Federal,

-11-

 

state, local and foreign income and employment tax withholding requirements applicable to the
Option exercise. Optionee acknowledges and agrees that the Company may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of
exercise.

     (j) Entire Agreement; Governing Law. The Plan is incorporated herein by reference.
The Plan and this Option Agreement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings and agreements of
the Company and Optionee with respect to the subject matter hereof, and may not be modified
adversely to the Optionee’s interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws but not the choice of law
rules of California.

     (k) No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE
VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE
PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION
OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN
EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD,
FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE
COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR
WITHOUT CAUSE.

     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 and this Option in their 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 Administrator 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.

	 	 	 
	OPTIONEE

	 	TALEO CORPORATION
	 
	 	 
	 
	 	 
	 

	 	 
	Signature

	 	By
	 
	 	 
	 
	 	 
	 

	 	 
	Print Name

	 	Title
	 
	 	 
	 	 	 
	 
	 	 
	 	 	 
	Residence Address
	 	 

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EXHIBIT A

2005 STOCK PLAN

EXERCISE NOTICE

Taleo Corporation

575 Market Street, 8th Floor

San Francisco, CA 94105

Attention: _______________

     1. Exercise of Option. Effective as of today, _________, ___, the undersigned
(“Optionee”) hereby elects to exercise Optionee’s option to purchase ___shares of the Common
Stock (the “Shares”) of Taleo Corporation (the “Company”) under and pursuant to the 2005 Stock Plan
(the “Plan”) and the Stock Option Agreement dated _________, ___(the “Option Agreement”).

     2. Delivery of Payment. Optionee herewith delivers to the Company the full purchase
price of the Shares, as set forth in the Option Agreement, and any and all withholding taxes due in
connection with the exercise of the Option.

     3. Representations of Optionee. Optionee acknowledges that Optionee has received,
read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their
terms and conditions.

     4. Rights as Stockholder. Until the issuance of the Shares (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer agent of the
Company), no right to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares shall
be issued to the Optionee as soon as practicable after the Option is exercised in accordance with
the Option Agreement. No adjustment shall be made for a dividend or other right for which the
record date is prior to the date of issuance except as provided in Section 12 of the Plan.

     5. Company’s Right of First Refusal. Before any Shares held by Optionee or any
transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise
transferred (including transfer by gift or operation of law), the Company or its assignee(s) shall
have a right of first refusal to purchase the Shares on the terms and conditions set forth in this
Section 5 (the “Right of First Refusal”).

          (a) Notice of Proposed Transfer. The Holder of the Shares shall deliver to the
Company a written notice (the “Notice”) stating: (i) the Holder’s bona fide intention to sell or
otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee
(“Proposed Transferee”); (iii) the number of Shares to be transferred to each Proposed Transferee;
and (iv) the bona fide cash price or other consideration for which the Holder proposes to transfer
the

 

 

Shares (the “Offered Price”), and the Holder shall offer the Shares at the Offered Price to
the Company or its assignee(s).

          (b) Exercise of Right of First Refusal. At any time within thirty (30) days after
receipt of the Notice, the Company and/or its assignee(s) may, by giving written notice to the
Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to
any one or more of the Proposed Transferees, at the purchase price determined in accordance with
subsection (c) below.

          (c) Purchase Price. The purchase price (“Purchase Price”) for the Shares purchased by
the Company or its assignee(s) under this Section 5 shall be the Offered Price. If the Offered
Price includes consideration other than cash, the cash equivalent value of the non-cash
consideration shall be determined by the Board of Directors of the Company in good faith.

          (d) Payment. Payment of the Purchase Price shall be made, at the option of the
Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any
outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an
assignee, to the assignee), or by any combination thereof within thirty (30) days after receipt of
the Notice or in the manner and at the times set forth in the Notice.

          (e) Holder’s Right to Transfer. If all of the Shares proposed in the Notice to be
transferred to a given Proposed Transferee are not purchased by the Company and/or its assignee(s)
as provided in this Section 5, then the Holder may sell or otherwise transfer such Shares to that
Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other
transfer is consummated within 120 days after the date of the Notice, that any such sale or other
transfer is effected in accordance with any applicable securities laws and that the Proposed
Transferee agrees in writing that the provisions of this Section 5 shall continue to apply to the
Shares in the hands of such Proposed Transferee. If the Shares described in the Notice are not
transferred to the Proposed Transferee within such period, a new Notice shall be given to the
Company, and the Company and/or its assignees shall again be offered the Right of First Refusal
before any Shares held by the Holder may be sold or otherwise transferred.

          (f) Exception for Certain Family Transfers. Anything to the contrary contained in
this Section 5 notwithstanding, the transfer of any or all of the Shares during the Optionee’s
lifetime or on the Optionee’s death by will or intestacy to the Optionee’s immediate family or a
trust for the benefit of the Optionee’s immediate family shall be exempt from the provisions of
this Section 5. “Immediate Family” as used herein shall mean spouse, lineal descendant or
antecedent, father, mother, brother or sister. In such case, the transferee or other recipient
shall receive and hold the Shares so transferred subject to the provisions of this Section 5, and
there shall be no further transfer of such Shares except in accordance with the terms of this
Section 5.

          (g) Termination of Right of First Refusal. The Right of First Refusal shall terminate
as to any Shares upon the earlier of (i) the first sale of Common Stock of the Company to the
general public, or (ii) a Change in Control in which the successor corporation has equity
securities that are publicly traded.

-2-

 

     6. Tax Consultation. Optionee understands that Optionee may suffer adverse tax
consequences as a result of Optionee’s purchase or disposition of the Shares. Optionee represents
that Optionee has consulted with any tax consultants Optionee deems advisable in connection with
the purchase or disposition of the Shares and that Optionee is not relying on the Company for any
tax advice.

     7. Restrictive Legends and Stop-Transfer Orders.

           (a) Legends. Optionee understands and agrees that the Company shall cause the legends
set forth below or legends substantially equivalent thereto, to be placed upon any certificate(s)
evidencing ownership of the Shares together with any other legends that may be required by the
Company or by state or federal securities laws:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT
OR, IN THE OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES,
SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE
THEREWITH.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE ISSUER OR ITS
ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE
ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST
REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFER FOR A PERIOD NOT TO EXCEED 180 DAYS FOLLOWING THE
EFFECTIVE DATE OF THE UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES
AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF BY THE HOLDER WITHOUT THE CONSENT
OF THE COMPANY OR THE MANAGING UNDERWRITER.

             (b) Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance with
the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions
to its transfer agent, if any, and that, if the Company transfers its own securities, it may make
appropriate notations to the same effect in its own records.

             (c) Refusal to Transfer. The Company shall not be required (i) to transfer on its
books any Shares that have been sold or otherwise transferred in violation of any of the provisions
of this Exercise Notice or (ii) to treat as owner of such Shares or to accord the right to vote or
pay dividends to any purchaser or other transferee to whom such Shares shall have been so
transferred.

-3-

 

     8. Successors and Assigns. The Company may assign any of its rights under this
Exercise Notice to single or multiple assignees, and this Exercise Notice shall inure to the
benefit of the successors and assigns of the Company. Subject to the restrictions on transfer
herein set forth, this Exercise Notice shall be binding upon Optionee and his or her heirs,
executors, administrators, successors and assigns.

     9. Interpretation. Any dispute regarding the interpretation of this Exercise Notice
shall be submitted by Optionee or by the Company forthwith to the Administrator which shall review
such dispute at its next regular meeting. The resolution of such a dispute by the Administrator
shall be final and binding on all parties.

     10. Governing Law; Severability. This Exercise Notice is governed by the internal
substantive laws but not the choice of law rules, of California. In the event that any provision
hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Exercise Notice will continue in full force and effect.

     11. Entire Agreement. The Plan and Option Agreement are incorporated herein by
reference. This Exercise Notice, the Plan, the Option Agreement and the Investment Representation
Statement constitute the entire agreement of the parties with respect to the subject matter hereof
and supersede in their entirety all prior undertakings and agreements of the Company and Optionee
with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s
interest except by means of a writing signed by the Company and Optionee.

	 	 	 
	Submitted by:

	 	Accepted by:
	OPTIONEE

	 	TALEO CORPORATION
	 
	 	 
	 
	 	 
	 

	 	 
	Signature

	 	By
	 
	 	 
	 
	 	 
	 

	 	 
	Print Name

	 	Title
	 
	 	 
	Address:

	 	Address:
	 

	 	575 Market Street, 8th Floor
	 	 	 
	 

	 	San Francisco, CA 94105
	 	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Date Received

-4-

 

EXHIBIT B

INVESTMENT REPRESENTATION STATEMENT

	 	 	 
	OPTIONEE:
	 	 
	 
	 	 
	COMPANY:

	 	TALEO CORPORATION
	 
	 	 
	SECURITY:

	 	COMMON STOCK
	 
	 	 
	AMOUNT:
	 	 
	 
	 	 
	DATE:
	 	 

     In connection with the purchase of the above-listed Securities, the undersigned Optionee
represents to the Company the following:

     1. Optionee is aware of the Company’s business affairs and financial condition and has
acquired sufficient information about the Company to reach an informed and knowledgeable decision
to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s
own account only and not with a view to, or for resale in connection with, any “distribution”
thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”).

     2. Optionee acknowledges and understands that the Securities constitute “restricted
securities” under the Securities Act and have not been registered under the Securities Act in
reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the
bona fide nature of Optionee’s investment intent as expressed herein. In this connection, Optionee
understands that, in the view of the Securities and Exchange Commission, the statutory basis for
such exemption may be unavailable if Optionee’s representation was predicated solely upon a present
intention to hold these Securities for the minimum capital gains period specified under tax
statutes, for a deferred sale, for or until an increase or decrease in the market price of the
Securities, or for a period of one year or any other fixed period in the future. Optionee further
understands that the Securities must be held indefinitely unless they are subsequently registered
under the Securities Act or an exemption from such registration is available. Optionee further
acknowledges and understands that the Company is under no obligation to register the Securities.
Optionee understands that the certificate evidencing the Securities will be imprinted with any
legend required under applicable state securities laws.

     3. Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under
the Securities Act, which, in substance, permit limited public resale of “restricted securities”
acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the
satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies under Rule 701
at the time of the grant of the Option to the Optionee, the exercise will be exempt from
registration under the Securities Act. In the event the Company becomes subject to the reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days
thereafter (or such

 

 

longer period as any market stand-off agreement may require) the Securities exempt under Rule
701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144,
including: (1) the resale being made through a broker in an unsolicited “broker’s transaction” or
in transactions directly with a market maker (as said term is defined under the Securities Exchange
Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information
about the Company, (3) the amount of Securities being sold during any three month period not
exceeding the limitations specified in Rule 144(e), and (4) the timely filing of a Form 144, if
applicable.

          In the event that the Company does not qualify under Rule 701 at the time of grant of the
Option, then the Securities may be resold in certain limited circumstances subject to the
provisions of Rule 144, which requires the resale to occur not less than one year after the later
of the date the Securities were sold by the Company or the date the Securities were sold by an
affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the
Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than
two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the
paragraph immediately above.

     4. Optionee further understands that in the event all of the applicable requirements of Rule
701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A,
or some other registration exemption will be required; and that, notwithstanding the fact that
Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has
expressed its opinion that persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden
of proof in establishing that an exemption from registration is available for such offers or sales,
and that such persons and their respective brokers who participate in such transactions do so at
their own risk. Optionee understands that no assurances can be given that any such other
registration exemption will be available in such event.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	Signature of Optionee:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Date:
	 	 	 	 	,	 	 	 
	 

	 	 	 	 
	 	 	      

-2-

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