S-8

As filed with the Securities and Exchange Commission on September 12, 2003

Registration No. 333-

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-8

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

ASCENTIAL SOFTWARE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization) 94-3011736
(I.R.S. Employer
Identification No.)

50 Washington Street
Westborough, MA 01581
(Address of principal executive office) (zip code)

TSI International Software Ltd. 1993 Stock Option Plan

1996 Novera Software Inc. Stock Option Plan

Mercator Software, Inc. 1997 Equity Incentive Plan
(Full title of the Plans)

Peter Gyenes
Chairman and Chief Executive Officer
Ascential Software Corporation
50 Washington Street
Westborough, MA 01581
(Name and address of agent for service)

(508) 366-3888
(Telephone number, including area code, of agent for service)

Copies to:

Scott N. Semel, Esq.
Vice President, General Counsel and Secretary
Ascential Software Corporation
50 Washington Street
Westborough, MA 01581 Louis A. Goodman, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street
Boston, MA 02108
(617) 573-4800

CALCULATION OF REGISTRATION FEE

			Proposed Maximum		Proposed Maximum		Amount of
Title of Securities	Amount to be		Offering Price		Aggregate Offering		Registration
to be Registered	Registered (1)		per Share (1)(3)		Price (3)		Fee (4)
TSI International Software Ltd. 1993 Stock Option Plan Common Stock, par value $.01 per share		41,195	$	18.34	$	755,516.3	$	61.12
1996 Novera Software Inc. Stock Option Plan Common Stock, par value $.01 per share		147		13.6		1,999.2		0.16
Mercator Software, Inc. 1997 Equity Incentive Plan Common Stock, par value $.01 per share		1,791,852		23.46		42,036,847		3,400.78

(1)	This Registration Statement also covers Common Stock Purchase Rights (the “Rights”) which are presently attached to and trade with the common stock of Ascential Software Corporation (the “Registrant”), par value $.01 per share (the “Common Stock”). Any value attributable to the Rights is reflected in the market price of the Common Stock.
(2)	In accordance with Rule 416 of the Securities Act of 1933, as amended (the “Securities Act”), this Registration Statement also includes an indeterminate number of shares that may be subject to issuance as a result of anti-dilution and other provisions of the TSI International Software Ltd. 1993 Stock Option Plan, the 1996 Novera Software Inc. Stock Option Plan, and the Mercator Software, Inc. 1998 Equity Incentive Plan (the “Assumed Option Plans”).
(3)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(h) under the Securities Act, the maximum offering price per share for each of the Assumed Option Plans is based on the weighted average exercise price of the options outstanding under the Assumed Option Plans.
(4)	The registration fee has been calculated pursuant to Section 6(b) of the Securities Act and Fee Advisory #11 for Fiscal Year 2003 issued by the Securities and Exchange Commission on February 21, 2003 by multiplying ..00008090 by the proposed maximum aggregate offering price (as computed in accordance with Rule 457 under the Securities Act solely for the purpose of determining the registration fee of the securities registered hereby).

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TABLE OF CONTENTS

EXPLANATORY NOTE
PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
	Item 3. Incorporation of Documents by Reference.
	Item 4. Description of Securities
	Item 5. Interests of Named Experts and Counsel
	Item 6. Indemnification of Directors and Officers
	Item 7. Exemption from Registration Claimed
	Item 8. Exhibits
	Item 9. Undertakings
SIGNATURES
Exhibit Index
EX-4.5 TSI INT SOFTWARE LTD 1993 STOCK OPTION PLAN
EX-4.6 NOVERA SOFTWARE INC 1996 STOCK OPTION PLAN
EX-4.7 MERCATOR SOFTWARE INC 1997 EQUITY INC PLAN
EX-5.1 OPINION OF SKADDEN ARPS LLP
EX-23.2 CONSENT OF KPMG LLP

EXPLANATORY NOTE

     Pursuant to the Agreement and Plan of Merger Agreement dated as of August 2, 2003 between the Registrant, Greek Acquisition Corporation (“Greek Acquisition”) and Mercator Software, Inc. (“Mercator”), Greek Acquisition commenced a tender offer for all the outstanding shares of Mercator at $3.00 per share. Following the acceptance of the shares for payment and the exercise of a common stock option granted to Greek Acquisition by Mercator, Greek Acquisition effected a short-form merger and was merged (the “Merger”) with and into Mercator with Mercator becoming a wholly owned subsidiary of the Registrant. All outstanding options to purchase common stock of Mercator, par value $0.01 per share, granted pursuant to the Assumed Option Plans prior to the Merger have been converted into options to purchase Common Stock, subject to the following adjustment:

•	the number of shares of Common Stock subject to such option is equal to the number of shares of Mercator common stock subject to the option, multiplied by the Exchange Ratio (as defined in the Merger Agreement) which is equal to 0.1795, rounded down to the nearest whole number; and
•	the per share exercise price for such converted option shall be equal to the exercise price of the option prior to the conversion, divided by the Exchange Ratio, which is equal to 0.1795, rounded up to the nearest whole cent,
such converted option is otherwise exercisable upon the same terms and conditions as were applicable immediately prior to the Merger.

     This Registration Statement is intended to register an aggregate of 1,833,194 shares of Common Stock, and the Rights associated therewith, that have been or may be issued under the Assumed Option Plans.

PART I

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

     The documents containing the information specified in Part I will be sent or given to employees as specified by Rule 428(b)(1). Such documents are not being filed with the Securities and Exchange Commission (the “Commission”) either as part of this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424. Such documents and the documents incorporated by reference in this Registration Statement pursuant to Item 3 of Part II of this Form, taken together, constitute a prospectus that meets the requirements of Section 10(a) of the Securities Act.

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference.

     The Registrant is subject to the informational and reporting requirements of Sections 13(a), 14 and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and in accordance therewith files reports, proxy statements and other information with the Commission. The following documents, which are on file with the Commission, are incorporated in this Registration Statement by reference:

(1)	Annual Report on Form 10-K for the year ended December 31, 2002;
(2)	Quarterly Reports on Form 10-Q for the quarterly periods ended June 30, 2003 and March 31, 2003;

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(3)	Current Reports on Form 8-K filed with the Commission on August 5, 2003, June 13, 2003, April 17, 2003 and April 3, 2003;
(4)	The description of Common Stock contained in the Registration Statement on Form 8-A, filed by the Registrant under Section 12 of the Exchange Act and declared effective by the Commission on January 21, 1987, including any amendment or report updating such description of Common Stock; and
(5)	The description of the Common Stock Purchase Rights contained in the amendment to the Registration Statement filed with the Commission on Form 8-A/A on September 3, 1997, as amended on December 3, 1997 and May 1, 2002.

     All documents subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates that all shares of Common Stock offered hereby have been sold or which deregisters all shares of Common Stock then remaining unsold, shall be deemed to be incorporated by reference herein and to be part hereof from the date of the filing of such documents.

     Any statement contained in a document incorporated or deemed to be incorporated herein by reference shall be deemed to be modified or superceded for purposes of this Registration Statement to the extent that a statement contained herein or in any subsequently filed document which also is or is deemed to be incorporated herein by reference modifies or supercedes such statement. Any statement so modified or superceded shall not be deemed, except as so modified or superceded, to constitute part of this Registration Statement.

Item 4. Description of Securities

     Not Applicable.

Item 5. Interests of Named Experts and Counsel

     Not Applicable.

Item 6. Indemnification of Directors and Officers

     Section 145 of the Delaware General Corporation Law (the “DGCL”) provides that a corporation has the power to indemnify a director, officer, employee or agent of the corporation and certain other persons serving at the request of the corporation in related capacities against amounts paid and expenses incurred in connection with an action or proceeding to which he is or is threatened to be made a party by reason of such position, if such person shall have acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, in any criminal proceeding, if such person had no reasonable cause to believe his conduct was unlawful; provided that, in the case of actions brought by or in the right of the corporation, no indemnification shall be made with respect to any matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the adjudicating court determines that such indemnification is proper under the circumstances.

     ARTICLE EIGHT of the Registrant’s Restated Certificate of Incorporation, as amended (the “Restated Certificate”), provides for the indemnification of any director, officer, employee or agent of the Registrant and certain other persons serving at the request of the Registrant in related capacities to the fullest extent permissible under Delaware law, except that the Registrant is prohibited against the indemnification of any person from or on account of conduct which was finally adjudged to have been knowingly fraudulent, deliberately dishonest or willful misconduct.

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     ARTICLE EIGHT further provides that, to the fullest extent permissible under Delaware law, no director of the Registrant shall be personally liable to the Registrant or its stockholders for monetary damages for breach of fiduciary duty as a director.

     ARTICLE VI of the Registrant’s Second Amended and Restated Bylaws (the “Bylaws”), provides for the indemnification of each person who was or is made a party or threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative, investigative, or appellate (“Proceeding”), by reason of the fact that he or she is or was a director or officer of the Registrant and certain other persons serving at the request of the Registrant as a director or officer of another corporation, or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such Proceeding is alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer shall be indemnified to the fullest extent not prohibited by Delaware Law, against all expenses, liability and loss (including, without limitation, attorneys’ fees, judgments, fines, ERISA excise taxes or penalties amounts paid or to be paid in settlement and advancement of expenses) reasonably incurred or suffered by such person in connection therewith or in connection with the investigation, defense, settlement or appeal of such Proceeding, to the full extent not prohibited by the DGCL. The indemnification provided by the Registrant includes advancement of expenses provided that if required by the DGCL and subject to the Bylaws, such advancement is subject to the director or officer undertaking to repay all amounts so advanced if it is ultimately determined that such director or officer was not entitled to indemnification. Such indemnification shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of his or her heir, executor and administrators.

     ARTICLE VI further provides that, the Registrant may, to the extent authorized from time to time by its Board of Directors, grant rights to indemnification, and to the advancement of expenses, to any employee or agent of the Registrant to the fullest extent indemnification and advancement of expenses is permitted to directors and officers of the Registrant.

     ARTICLE VI of the Bylaws further provides that the indemnification provided therein is not exclusive of any other right which such person may have or hereafter acquire under any statute, provision of the Restated Certificate or Bylaws, agreement, vote of stockholders or disinterested directors, insurance policy, or otherwise. Nothing shall limit in any way any right which the Registrant may have to make additional indemnifications with respect to the same or different persons or classes of persons.

     The Registrant has entered into indemnification agreements with each of its directors and executive officers, and intends to enter into indemnification agreements with any new directors and executive officers in the future. These agreements may require the Registrant, among other things, to indemnify such directors and officers against certain liabilities that may arise by reason of their status or service and to advance their expenses incurred as a result of any Proceeding against them as to which they could be indemnified.

     The general effect of the foregoing provisions may be to reduce the circumstances in which an officer or director of the Registrant may be required to bear the economic burden of the foregoing liabilities and expenses.

     The Registrant has purchased directors’ and officers’ liability insurance which would indemnify the directors and officers of the Registrant against damages arising out of certain kinds of claims which might be made against them based on their negligent acts or omissions while acting in their capacity as such.

Item 7. Exemption from Registration Claimed

     Not Applicable.

Item 8. Exhibits

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     The Exhibit Index immediately preceding the exhibits is incorporated herein by reference.

Item 9. Undertakings

     a.     The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:

(i) to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement.

(2)	That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3)	To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

     b.     The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the Registration Statement shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

     c.     Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

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SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Westborough, Commonwealth of Massachusetts, on September 12, 2003.

ASCENTIAL SOFTWARE CORPORATION
By:	/s/ Robert McBride
	Robert McBride
	Chief Financial Officer

Power of Attorney and Signatures

     We, the undersigned officers and directors of Ascential Software Corporation hereby severally constitute Peter Gyenes, Robert McBride and Peter Fiore, and each of them individually, our true and lawful attorneys with full power to them, and each of them singly, to sign for us and in our names in the capacities indicated below, the Registration Statement on Form S-8 filed herewith and any and all subsequent amendments to said Registration Statement, and generally to do all such things in our names and behalf in our capacities as officers and directors to enable Ascential Software Corporation to comply with all requirements of the Securities and Exchange Commission, hereby ratifying and confirming our signatures as they may be signed by said attorneys, or any of them, to said Registration Statement and any and all amendments thereto.

     Pursuant to the requirements of the Securities Act, this Registration Statement has been signed below by the following persons in the capacities indicated on this 12th day of September, 2003.

/s/ Peter Gyenes Peter Gyenes	Chief Executive Officer and Chairman of the Board of Directors
/s/ Robert McBride Robert McBride	Chief Financial Officer
/s/ David Ellenberger David Ellenberger	Director
/s/ John Gavin John Gavin	Director
/s/ Robert Morrill Robert Morrill	Director
/s/ William Weyand William Weyand	Director

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Exhibit Index

Exhibit
Number	Description
3.1 (1)	Restated Certificate of Incorporation of the Registrant;
3.2 (2)	Second Amended and Restated Bylaws of the Registrant;
4.1 (3)	Specimen Common Stock Certificate;
4.2 (4)	First Amended and Restated Rights Agreement, dated as of August 12, 1997, between Informix Corporation and BankBoston N.A.;
4.3 (5)	Amendment No. 1 to the First Amended and Restated Rights Agreement, dated as of November 17, 1997, between Informix Corporation and BankBoston N.A.;
4.4 (6)	Amendment No. 2 to the First Amended and Restated Rights Agreement, dated as of April 26, 2002, between the Registrant and EquiServe Trust Company, N.A.;
4.5	TSI International Software Ltd. 1993 Stock Option Plan
4.6	1996 Novera Software Inc. Stock Option Plan
4.7	Mercator Software, Inc. 1997 Equity Incentive Plan
5.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP;
23.1	Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.1);
23.2	Consent of KPMG LLP;
24.1	Power of Attorney (included in the signature pages of this Registration Statement).

(1)	Incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001, filed with the Commission on April 1, 2002.
(2)	Incorporated by reference to Exhibit 3.2 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002, filed with the commission on March 27, 2003.
(3)	Incorporated by reference to Exhibit I.1. to the Registrant’s Registration Statement on Form 8-A, filed on January 21, 1987.
(4)	Incorporated by reference to Exhibit 5 to an amendment to the Registrant’s Registration Statement on Form 8-A/A, filed on September 3, 1997.
(5)	Incorporated by reference to Exhibit 5.1 to an amendment to the Registrant’s Registration Statement on Form 8-A/A, filed on December 3, 1997.

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(6) Incorporated by reference to Exhibit 4.4 to an amendment to the Registrant’s Registration Statement on Form 8-A/A, filed on May 1, 2002.

9 EX-4.5 3 b47765asexv4w5.txt EX-4.5 TSI INT SOFTWARE LTD 1993 STOCK OPTION PLAN EXHIBIT 4.5 TSI INTERNATIONAL SOFTWARE LTD. 1993 STOCK OPTION PLAN (AS ADOPTED SEPTEMBER 10, 1993) SECTION 1. PURPOSE OF THE PLAN This 1993 Stock Option Plan is intended to continue the established policy of TSI International Software Ltd. ("Company") of encouraging ownership of its Common Stock by selected persons and of providing incentives for them to increase the productivity of the Company. By extending to those selected persons the opportunity to acquire proprietary interests in the Company and to participate in its success, this Plan may be expected to benefit the Company and its shareholders by making it possible for the Company to attract and retain the best available talent and by rewarding those selected persons for their part in increasing the value of the Company's stock. SECTION 2. PRIOR PLAN Upon the effectiveness of the merger in which TSI International Ltd., a Connecticut corporation ("TSI Connecticut") merges with and into the Company, all options granted pursuant to the TSI Connecticut 1989 Stock Option Plan, as amended, shall be assumed under this Plan, and shall be deemed granted under this Plan for all purposes. SECTION 3. DEFINITIONS As used herein, the following definitions shall apply: 3.01 "Affiliate" shall mean any person or entity which controls, is controlled by or is under common control with the Company, where "control" means the ownership of more than fifty percent (50%) of the total voting power of the outstanding stock of a corporation or of the outstanding ownership of a non- corporate entity. 3.02 "Board" shall mean the Board of Directors of the Company. 3.03 "Code" shall mean the Internal Revenue Code of 1986, including any amendments made thereto. 3.04 "Committee" shall mean the Stock Option Committee of the Board of Directors, if any, and shall otherwise mean the Board. 3.05 "Common Stock" shall mean the Common Stock, $.01 par value per share, of the Company. 3.06 "Company" shall mean TSI International Software Ltd. 3.07 "Continuous Employment" with the Company or any Parent, Subsidiary or Affiliate of the Company shall mean, in the case of an employee, continuous regular employment by the Company or any Parent, Subsidiary or Affiliate of the Company, or an uninterrupted chain of continuous regular employment by the Company or any Parent, Subsidiary or Affiliate of the Company. A leave of absence granted in accordance with the Company's usual procedure which does not operate to interrupt Continuous Employment for other benefits granted by the Company shall not be considered a termination of employment nor an interruption of Continuous Employment hereunder, and an employee who is granted such a leave of absence shall be considered to be continuously employed during the period of such leave. In the case of an Optionee who is a director, independent consultant, contractor or advisor, the Committee will have the discretion to determine whether the Optionee is "continuously employed by the Company." 3.08 "Formula Value" shall mean the sum of (I) the aggregate exercise price of all In-the-Money Options to purchase Common Stock exercisable as of the most recent fiscal year end plus (II) the greater of: (a) eighty percent (80%) of the annual sales of the Company for the fiscal year of the Company most recently ended; or (b) the product of the Matrix Factor multiplied by the Company's net profit before taxes for the twelve-month period ended on the last date of the most recently ended fiscal year. 3.09 "In-the-Money Options" shall mean outstanding options to purchase Common Stock (whether granted pursuant to an employee stock option plan or otherwise) as to which the exercise price per Share is less than the current value of Common Stock per Share. For purposes of the identification of "In-the- Money Options" only, the current value of Common Stock per Share shall mean the quotient of (I) the greater of: (a) eighty percent (80%) of the annual sales of the Company for the Company's most recently ended fiscal year; or (b) the product of the Matrix Factor multiplied by the Company's net profit before taxes for the twelve-month period ended on the last day of the Company's most recently ended fiscal year, divided by (II) the Outstanding Shares as of the most recent fiscal year end. 3.10 "Matrix Factor" shall mean a percentage represented by the factor set out in the matrix set forth in the addendum attached hereto. For purposes of determining "Earnings Growth" or "Sales Growth" for purposes of such matrix, sales and net earnings of the Company for the most recently ended fiscal year shall be compared to sales and net earnings of the Company for the second most recently ended fiscal year. Net earnings, sales and net profits before taxes for each relevant fiscal year, and annual sales of the Company for each fiscal year, shall be determined in good faith by the Committee, on the basis of audited financial statements of the Company prepared by the independent certified public accountants then retained by the Company, to the extent available or expected to be available within a reasonable time, or to the extent audited financial statements are not and will not be so available, on unaudited financial statements prepared according to generally accepted accounting principles consistently applied to prior periods. 3.11 "Option" shall mean a stock option granted pursuant to this Plan. 3.12 "Optionee" shall mean a selected person who receives an Option. 3.13 "Outstanding Shares" will mean the sum of the outstanding shares of Common Stock plus all outstanding convertible preferred stock (on an as-if- converted to Common Stock basis) plus all In-the-Money Options (on an as-if- exercised basis). 3.14 "Parent" means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company if, at the time of the granting of the Option, each of such corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 3.15 "Plan" shall mean this 1993 Stock Option Plan. 3.16 "Share" shall mean a share of the Common Stock of the Company as adjusted in accordance with Section 17 of this Plan. 3.17 "Subsidiary" shall mean any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if, at the time of granting the Option, each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. SECTION 4. TYPES OF OPTIONS AND SHARES Options to purchase Shares granted under this Plan may be either (a) incentive stock options ("ISO's") within the meaning of Section 422A of the Code or (b) non-qualified stock options ("NQSO's"), as designated at the time of grant. SECTION 5. STOCK RESERVED FOR THE PLAN 5.01 Number of Shares. The aggregate number of Shares, that may be issued pursuant to Options granted under this Plan is 519,477 Shares, subject to adjustment pursuant to the provisions of Section 16, plus any Shares that become available through repurchases pursuant to Section 5.03, below. At all times during the term of this Plan, the Company shall reserve out of its authorized but unissued Shares, or its treasury shares, such number of Shares as may be issued upon the exercise of Options granted under this Plan. 5.02 Termination or Expiration of Options. If any Options granted under this Plan shall for any reason terminate or expire without having been exercised in full, the Shares not purchased under such Options shall be available for future grant and purchase under this Plan. 5.03 Repurchase of Stock. Any Shares previously issued pursuant to this Plan, and any Shares that were previously shares of the Company's Class C Common Stock, that are subsequently repurchased pursuant to the Company's right to repurchase stock, shall be available for future grant and purchase under this Plan; provided that no such repurchased Shares may be made subject to ISO's granted under this Plan. SECTION 6. ADMINISTRATION OF THE PLAN 6.01 Committee. The Board shall appoint a Stock Option Committee of directors (the "Committee") to administer this Plan. The Board may from time to time appoint members of the Committee in substitution for or in addition to members previously appointed to fill vacancies, however caused, in the Committee. Prior to such appointment, the entire Board shall act as the "Committee." No member of the Committee may participate in any respect concerning the granting of an Option to such member. 6.02 Administration by Committee. The Committee shall have plenary authority in its discretion (subject to the express provisions of this Plan): to determine the purchase price of the Common Stock covered by each Option, the selected persons to whom and the time or times at which Options shall be granted, time or times at which Options granted hereunder shall become exercisable, and the number of Shares to be covered by each Option; to interpret this Plan; to prescribe, amend and rescind rules and regulations relating to this Plan; to determine the terms (which need not be identical) of option agreements executed and delivered under this Plan, including such terms and provisions as shall be requisite in the judgment of the Committee to conform to any change in any law or regulation applicable thereto; to accelerate the exercisability of any Option; to modify or amend any option agreement entered into pursuant hereto; to execute on behalf of the Company any instrument required to effectuate an Option grant; to ensure satisfaction of any withholding tax obligation which may be imposed with respect to the grant or exercise of an Option; and to make all other determinations deemed necessary or advisable for the administration of the Plan. The Committee's determination on the foregoing matters shall be conclusive. Upon the Committee's request, the President of the Company shall make recommendations to the Committee as to the granting of Options and any other determinations within the Committee's discretion. SECTION 7. ELIGIBILITY Options may be granted to employees, officers, directors, consultants, independent contractors and advisors (provided such consultants, contractors and advisors render bona fide services not in connection with the offer and sale of securities of the Company in a capital-raising transaction) of the Company or any Parent, Subsidiary or Affiliate of the Company. ISO's may be granted only to employees (including officers and directors who are also employees) of the Company or a Parent or Subsidiary of the Company. The Committee in its sole discretion shall select the Optionees. An Optionee may be granted more than one Option under this Plan. The Company may also, from time to time, assume outstanding options granted by another company, whether in connection with an acquisition of such other company or otherwise, by either (i) granting an option under this Plan in replacement of the option assumed by the Company, or (ii) treating the assumed option as if it had been granted under this Plan if the terms of such assumed option could be applied to an option granted under this Plan. Such assumption shall be permissible if the holder of the assumed option would have been eligible to be granted an option hereunder if the other company had applied the rules of this Plan to such grant. SECTION 8. FACTORS TO BE CONSIDERED IN GRANTING OPTIONS In determining the selected persons to whom Options shall be granted, the terms of the Option and the number of Shares to be covered by each Option, the Committee shall take into account such factors as it shall deem relevant in connection with accomplishing the purpose of this Plan. SECTION 9. GRANT AGREEMENT; CONSIDERATION The Committee shall cause to be executed by any person receiving and accepting the grant of an Option, a written option agreement in such form as the Committee shall determine, specifying the terms and conditions of the Option (the "Grant"). All Grants shall conform to the provisions of the Plan, but the specific terms and conditions of each Option granted thereunder need not be the same. The Committee shall require such consideration for the granting of the Option as it shall deem necessary or advisable. SECTION 10. OPTION PRICES The purchase price of Common Stock covered by each Option shall be determined by the Committee, but shall not be less than 100% of the fair market value of the Common Stock at the time the Option is granted unless the Committee determines, with respect to NQSO's only, that a lower purchase price is advisable. Any determination of the fair market value or of the method of computing fair market value of a share made by the Committee shall be final, binding and conclusive on all parties. In the absence of any provision by the Committee to the contrary, the fair market value of the Share shall be (A) the Formula Value of the Company divided by (B) the sum of (I) the Outstanding Shares plus (II) the maximum aggregate number of shares of Common Stock which could be purchased by the exercise of In-the-Money Options exercisable as of the most recent fiscal year end. SECTION 11. TERM OF OPTIONS Options shall be exercisable within the times or upon the events determined by the Committee as set forth in the Grant; provided, however, that no Option shall be exercisable after the expiration of ten (10) years from the date the Option is granted, and provided further that no ISO granted to a holder of ten percent (10%) or more of the Outstanding Shares shall be exercisable after the expiration of five (5) years from the date the Option is granted. SECTION 12. EXERCISE OF OPTIONS 12.01 When exercisable, the Committee shall have the discretion to establish the vesting schedule for any Options granted under this Plan. In the event of a dissolution or liquidation of the Company, a merger in which the Company is not the surviving corporation (except for a merger in which the shareholders of the Company own or control a majority of the surviving corporation's voting stock immediately following such merger), the acquisition of all or substantially all of the Company's outstanding stock in which the shareholders of the Company own or control less than a majority of the Company's voting stock immediately following such acquisition, the sale of all or substantially all of the assets of the Company, or any other transaction which qualifies as a "corporate transaction" under Section 425(a) of the Code wherein the shareholders of the Company give up all of their equity interest in the Company, any or all outstanding Options shall, notwithstanding any contrary terms of the Grant, accelerate and become exercisable in full at least twenty (20) days prior to and shall expire on, (and, if the Company has reserved to itself a right to repurchase shares issued upon exercise of Options at the original purchase price of such shares, such right shall terminate upon), the consummation of such dissolution, liquidation, merger, acquisition or sale of assets at such times and on such conditions as the Committee shall determine. The aggregate Fair Market Value (determined at the time an Option is granted) of stock with respect to all ISOs held by an Optionee that first become exercisable in the calendar year of such dissolution, liquidation, merger, sale of stock or sale of assets may not exceed $100,000. If the Fair Market Value of stock with respect to which all ISOs are first exercisable in such calendar year exceeds $100,000, the Options for the first $100,000 worth of stock to become exercisable in that year shall be ISOs and the Options for the amount in excess of $100,000 shall be NQSOs. Unless otherwise provided in the option agreement, a holder of an Option may purchase all, or from time-to-time any part of, the Shares the right to purchase which has accrued to him or her in accordance with the terms of this Section. Except as provided in Sections 15 and 16, no Option may be exercised at any time unless the holder thereof is then employed by the Company or a Parent, Subsidiary or Affiliate of the Company. In the case of an NQSO held by a director, consultant, independent contractor or adviser, the Committee shall determine, in its sole discretion, whether the Optionee is "employed by the Company." The holder of an Option shall have none of the rights of a shareholder with respect to the Shares subject to Option until such Shares shall have been registered on the transfer books of the Company in the name of the person or persons exercising the Option upon the exercise of the option. 12.02 Payment of Purchase Price. Payment for the Shares may be made in cash (by check) or, where approved by the Committee in its sole discretion at the time of grant and where permitted by law: (i) the cancellation of indebtedness of the Company to the Optionee; (ii) by waiver of compensation due or accrued to Optionee for services rendered; (iii) by surrender of shares of Common Stock of the Company that have been owned by the Optionee for more than six (6) months (and which have been paid for within the meaning of SEC Rule 144) or were obtained by the Optionee in the open public market having a Fair Market Value equal to the exercise price of the Option; (iv) provided that a public market for the Company's stock exists, through a "same day sale" commitment from the Optionee and a broker-dealer that is a member of the National Association of Securities Dealers (an "NASD Dealer") whereby the Optionee irrevocably elects to exercise the Option and to sell a portion of the Shares so purchased to pay for the exercise price and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the exercise price directly to the Company; or (v) by any combination of the foregoing. 12.03 Withholding taxes. Prior to issuance of the Shares upon exercise of an Option, the Optionee shall pay or make adequate provision for any federal or state withholding obligations of the Company, if applicable. Where approved by the Committee in its sole discretion, the Optionee may provide for payment of withholding 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. 12.04 Notice of Election. A person electing to exercise an Option shall give written notice to the Company, as specified by the Committee, of his or her election to exercise an Option and of the number of Shares such person has elected to purchase, such notice to be accompanied by the instrument evidencing such Option and any other documents required by the Committee or the Grant, and shall at the time of such exercise tender the purchase price of the Shares such person has elected to purchase. If the notice of election to exercise is given by the executor or administrator of a deceased Optionee or by the person or persons to whom the Option has been transferred under the Optionee's will or the applicable laws of descent and distribution, the Company will be under no obligation to deliver Shares pursuant to such exercise unless and until the Company is satisfied that the person or persons giving such notice is or are entitled to exercise the Option. 12.05 Restrictive Agreement. Any Common Stock purchased pursuant to an Option granted under this Plan shall be held subject to such restrictions as the Committee shall determine, in its sole discretion, are appropriate at the time of grant of the Option SECTION 13. ASSUMED OPTIONS In the event the Company assumes an option granted by another Company, the terms and conditions of such option shall remain unchanged (except the exercise price and the number and nature of shares issuable upon exercise, which will be adjusted appropriately pursuant to Section 425(c) of the Code). In the event the Company elects to grant a new option rather that assuming an existing option (as specified in Section 7), such new option need not be granted at Fair Market Value on the date of grant and may instead be granted with a similarly adjusted exercise price. SECTION 14. NON-TRANSFERABILITY OF OPTIONS An Option granted under this Plan shall not be transferable otherwise than by will or the laws of descent and distribution, and an Option may be exercised, during the lifetime of the Optionee, only by such Optionee. SECTION 15. TERMINATION OF EMPLOYMENT 15.01 Right to Exercise Option. If an Optionee ceases to be employed by the Company or any Parent, Subsidiary or Affiliate of the Company for any reason except death or disability, the Optionee may exercise such Optionee's Option to the extent (and only to the extent) that it would have been exercisable upon the date of termination, within three (3) months after the date of termination (or such shorter time period as may be specified in the Grant), provided that, if Optionee is an Insider and the Company is subject to Section 16(b) of the Exchange Act, the Optionee's Option will be exercisable for a period of time sufficient to allow such Optionee from having a matching purchase and sale under Section 16(b), with any extension beyond three (3) months from termination of employment deemed to be an NQSO, and provided further that in no event may an Option be exercisable later than the expiration date of the Option. 15.02 Employment Relationship. Options granted under this Plan shall not be affected by change of duties or position so long as the Optionee continues to be employed by or to have a similar relationship with the Company or any Parent, Subsidiary or Affiliate of the Company; provided that the holder of an ISO must remain an employee of the Company or a Parent or Subsidiary in order for such Optionee's employment not to be deemed to have terminated as regards such ISO. Retirement pursuant to any pension plan provided by the Company shall be deemed to be a termination of employment for the purposes of this Section. Nothing in this Plan or in any Option granted pursuant to this Plan shall confer upon any person employed by the Company or any Parent, Subsidiary or Affiliate of the Company, any right to continue in the employ of the Company or any Parent, Subsidiary or Affiliate of the Company or interfere with the right of the Company to terminate such Optionee's employment or other relationship at any time. SECTION 16. DEATH OF OPTIONEE If an Optionee's employment or other relationship with the Company or any Parent, Subsidiary or Affiliate of the Company is terminated because of the death of the Optionee or disability of Optionee within the meaning of Section 22(e)(3) of the Code, such Optionee's Options may be exercised to the extent (and only to the extent) that it would have been exercisable by the Optionee on the date of termination, by the Optionee (or the Optionee's legal representative) within twelve (12) months after the date of termination (or such shorter time period as may be specified in the Grant), but in any event no later than the expiration date of the Options. SECTION 17. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION In the event that the number of outstanding shares of Common Stock of the Company is changed by the stock dividend, stock split, reverse stock split, combination, re-classification or similar change in the capital structure of the Company without consideration, or if a substantial portion of the assets of the Company are distributed, without consideration in a spin-off or similar transaction, to the shareholders of the Company, the number of Shares available under this Plan and the number of Shares subject to outstanding Options and the exercise price per share of such Option shall be proportionately adjusted, subject to any required action by the Board or shareholders of the Company and compliance with applicable securities laws; provided, however, that a fractional share shall not be issued upon exercise of any Option and any fractions of a Share that would have resulted shall either be cashed out at Fair Market Value or the number of shares issuable under the Option shall be rounded up to the nearest whole number, as determined by the Committee; and provided further that the exercise price may not be decreased to below the par value, if any, for the Shares. SECTION 18. TIME OF GRANTING OPTIONS Nothing contained in this Plan or in any resolution to be adopted by the Board or the holders of securities of the Company shall constitute the granting of any Option hereunder. An Option granted pursuant to this Plan shall be deemed to have been granted on the date on which the name of the recipient and price of the Shares and the other terms of the Option are determined by the Committee. SECTION 19. TERMINATION AND AMENDMENT OF THE PLAN Unless this Plan shall theretofore have been terminated as hereinafter in this Section provided, no Option shall be granted hereunder after ten (10) years from the date of the adoption hereof. The Board may at any time prior to that date terminate this Plan or make such modification or amendment of this Plan as it shall deem advisable; provided, however, that no amendment may be made, without the approval by the holders of the Company's shareholders, except as provided in Section 16 hereof, which would (i) increase the maximum number of Shares for which Options may be granted under this Plan, (ii) extend the period during which an Option may be granted, or (iii) amend the requirements as to the class of selected persons eligible to receive Options. No termination, modification, or amendment of this Plan or any Grant may, without consent of the Optionee to whom an Option shall theretofore have been granted, adversely affect the rights of such Optionee under such Option. SECTION 20. CONDITIONS UPON ISSUANCE OF SHARES Shares of Common Stock shall not be issued with respect to an Option unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, the requirements of any stock exchange upon which the Common Stock may then be listed, the applicable state securities laws, and shall be further subject to the approval of counsel for the Company with respect to such compliance. As a condition to the exercise of an Option, the Company may require the person exercising such Option to represent and warrant at the time of any such exercise that the Common Stock is being purchased only for investment and without any present intention to sell or distribute such Common Stock if, in the opinion of counsel for the Company, such a representation is necessary or desirable under any of the aforementioned relevant provisions of law. SECTION 21. GOVERNMENT REGULATIONS The Plan and the granting and exercise of Options hereunder, and the obligation of the Company to sell and deliver Shares under such Options, shall be subject to all applicable laws, rules and regulations. SECTION 22. EFFECTIVE DATE; SHAREHOLDER'S APPROVAL The Plan shall be effective upon shareholder approval within twelve (12) months of its adoption by the Board by a majority of those shareholders of the Company who are present at a duly constituted shareholders' meeting. SECTION 23. GOVERNING LAW This Plan shall be governed by and construed in accordance with the laws of the State of Connecticut. ADDENDUM Matrix Factor

Sales Growth (%) Earnings Growth (%) - ------------------------------------------------------------------------------- Less than 10% 10-15% 15-20% Greater than 20% - ------------------------------------------------------------------------------- Less than 10% 4 5 6 7 10-15% 5 6 7 8 15-20% 6 7 8 9 Greater than 20% 7 8 9 10

[FORM OF TSI INTERNATIONAL SOFTWARE LTD. STOCK OPTION GRANT] Optionee: ____________________________________ Address: ____________________________________ Total Shares Subject to Option: ____________________________________ Exercise Price Per Share: ____________________________________ Date of Vesting Commencement: ____________________________________ Date of Grant: ____________________________________ Expiration Date: ____________________________________ Type of Stock Option: ____________ Incentive ____________ Nonqualified 1. Grant of Option. TSI International Software Ltd., a Connecticut corporation (the "Company"), hereby grants, on the date of grant set forth above (the "Date of Grant"), to the optionee named above ("Optionee") an option (this "Option") to purchase the total number of shares of Common Stock of the Company set forth above (the "Shares") at the exercise price per share set forth above (the "Exercise Price"), subject to all of the terms and conditions of this Grant and the Company's 1993 Stock Option Plan, as amended to the date hereof (the "Plan"). If designated as an Incentive Stock Option above, this Option is intended to qualify as an "incentive stock option" ("ISO") within the meaning of Section 422A of the Internal Revenue Code of 1986, as amended (the "Code"). Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to them in the Plan. 2. Exercise Period of Option. Subject to the terms and conditions of the Plan and this Grant, this Option shall become exercisable as to one- quarter of the Shares on and after the date of vesting commencement set forth above (the "Vesting Commencement Date"), and shall become exercisable as to an additional one-quarter of the Shares on each anniversary of the Vesting Commencement Date thereafter; provided that this Option shall expire on the Expiration Date set forth above and must be exercised, if at all, on or before the Expiration Date. 3. Restriction on Exercise. This Option may not be exercised unless such exercise is in compliance with the Securities Act of 1933 and all applicable state 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 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 Commission, any state securities commission or any stock exchange to effect such compliance. 4. Termination of Option. Except as provided below in this Section, this Option shall terminate and may not be exercised if Optionee ceases to be employed by the Company or any Parent or Subsidiary of the Company (or, in the case of a nonqualified stock option, an Affiliate of the Company). Optionee shall be considered to be employed by the Company for all purposes under this Section 4 if Optionee is an officer, director or full-time employee of the Company or any Parent, Subsidiary or Affiliate of the Company or if the Board of Directors determines that Optionee is rendering substantial services as a part- time employee, consultant, contractor or adviser to the Company or any Parent, Subsidiary or Affiliate of the Company. The Board of Directors of the Company shall have discretion to determine whether Optionee has ceased to be employed by the Company or any Parent, Subsidiary or Affiliate of the Company and the effective date on which such employment terminated (the "Termination Date"). (a) Termination Generally. If Optionee ceases to be employed by the Company or any Parent, Subsidiary or Affiliate of the Company for any reason except death or disability, this Option, to the extent (and only to the extent) that it would have been exercisable by Optionee on the Termination Date, may be exercise by Optionee within three (3) months after the Termination Date, but in no event later than the Expiration Date. (b) Death or Disability. If Optionee's employment with the Company or any Parent, Subsidiary or Affiliate of the Company is terminated because of the death of Optionee or the disability of Optionee within the meaning of Section 22(e)(3) of the Code, 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 Optionee's legal representative) within twelve (12) months after the Termination Date, but in no event later than the Expiration Date. (c) No Right to Employment. Nothing in the Plan or this Grant shall confer on Optionee any right to continue in the employ of, or other relationship with, the Company or any Parent, Subsidiary or Affiliate of the Company or limit in any way the right of the Company or any Parent, Subsidiary or Affiliate of the Company to terminate Optionee's employment or other relationship at any time, with or without cause. 5. Manner of Exercise. (a) Exercise Agreement. This Option shall be exercisable by delivery to the Company of any executed written Stock Option Agreement in the form attached hereto as Exhibit A, or in such other form as may be approved by the Company, which shall set forth Optionee's election to exercise some or all of 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. (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 check) or, where permitted by law, such other forms of consideration as are set forth in the Plan. (c) Withholding Taxes. Prior to the issuance of the Shares upon exercise of this Option, Optionee must pay or make adequate provision for any applicable federal or state withholding obligations of the Company. (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. Notice of Disqualifying Disposition of ISO Shares. If the Option granted to Optionee herein is an ISO, and if Optionee sells or otherwise disposes of any of the Shares acquired pursuant to the ISO on or before the later if (1) the date two years after the Date of Grant, or (2) the date one year after exercise of the ISO with respect to the Shares to be sold or disposed, the Optionee shall immediately notify the Company in writing of such disposition. Optionee acknowledges and agrees that Optionee may be subject to income tax withholding by the Company in the compensation income recognized by the Optionee from any such early disposition by paymnet in cash or out of the current wages or other earnings payable to the Optionee. 7. Nontransferability of Option. This Option may not be transferred in any manner other than by will or by the law of descent and distribution and may be exercised during the lifetime of the Optionee only by the Optionee. The terms of this Option shall be binding upon the executors, administrators and successors of the Optionee. 8. Interpretation. Any dispute regarding the interpretation of this Stock Option Grant shall be submitted by Optionee or the Company to the Company's Board of Directors or the committee thereof that administers the Plan, which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Board or committee shall be final and binding on the Company and on Optionee. 9. Entire Agreement. The Plan and the Stock Option Exercise Agreement attached as Exhibit A are incorporated herein by this reference. This Grant, the Plan and the Stock Option Exercise Agreement constitute the entire agreement of the parties hereto and supersede all prior undertakings and agreements with respect to the subject matter hereof. TSI INTERNATIONAL SOFTWARE LTD. By: ___________________________________ Name: ___________________________________ Title: ___________________________________ ACCEPTANCE Optionee hereby acknowledges receipt of a copy of the Plan, represents that Optionee has read and understands the terms and provisions thereof, and accepts this Option subject to all terms and conditions of the Plan and this Stock Option Grant. Optionee acknowledges that there may be adverse tax consequences upon exercise of this Option or disposition of the Shares and that Optionee should consult a tax adviser prior to such exercise or disposition. _____________________________ Optionee Exhibit A [FORM OF STOCK OPTION EXERCISE AGREEMENT] This Agreement is made this ____ day of ________________, 19___ between TSI International Software Ltd. (the "Company"), and the optionee named below ("Optionee"). Optionee: _______________________________________________ Social Security Number: _______________________________________________ Address: _______________________________________________ _______________________________________________ Number of Shares Purchased: _______________________________________________ Price per Share: _______________________________________________ Aggregate Purchase Price: _______________________________________________ Date of Option Grant: _______________________________________________ Date of Vesting Commencement: _______________________________________________ Type of Option [ ] Incentive Stock Option [ ] Nonqualified Stock Option Optionee hereby delivers to the Company the Aggregate Purchase Price, to the extent permitted in the Option Grant, as follows (check as applicable and complete): [ ] in cash in the amount of $__________, receipt of which is acknowledged by the Company; [ ] by delivery of ____________ fully-paid, nonassessable and vested shares of the Common Stock of the Company owned by Optionee for at least six (6) months prior to the date hereof and owned free and clear of all liens, claims, encumbrances or security interests, valued at the current fair market value of $_________ per share (as determined by the Board of Directors of the Company in good faith); [ ] by the waiver hereby of compensation due or accrued for services rendered in the amount of $___________; or [ ] if the Company is public, through a "same-day-sale" commitment, delivered herewith, from Optionee and the NASD broker named therein in the amount of $____________. The Company and Optionee hereby agree as follows: 1. Purchase of Shares. On this date and subject to the terms and conditions of this Agreement, Optionee hereby exercises the Stock Option Grant between the Company and Optionee dated as of the Date of Option Grant set forth above (the "Grant"), with respect to the Number of Shares Purchased set forth above of the Company's Common Stock (the "Shares") at an aggregate purchase price equal to the Aggregate Purchase Price set forth above (the "Purchase Price") and the Price per Share set forth above (the "Purchase Price Per Share"). The term "Shares" refers to the Shares purchased under this Agreement includes all securities received (a) in replacement of the Shares, and (b) as a result of stock dividends or stock splits in respect of the Shares. Capitalized terms used herein that are not defined herein have the definitions ascribed to them in the Plan or the Grant. 2. Stockholders' Agreement. By executing this Agreement, Optionee is also agreeing to become a party to and be bound by that certain Stockholders' Agreement dated as of June 1, 1989, as amended to the date hereof and as it may be further amended pursuant to its terms (the "Stockholders' Agreement"). A copy of the Stockholders' Agreement as executed on June 1, 1989 is attached hereto as Attachment 1. A copy of all amendments thereto may be obtained without charge from the Company at its principal offices. 3. Representations of Purchaser. Optionee represents and warrants to the Company that: (a) Optionee acknowledges that Optionee has received, read and understood the Plan and the Grant and agrees to abide by and be bound by their terms and conditions. (b) Optionee is purchasing the Shares for Optionee's own account for investment purposes only and not with a view to, or for sale in connection with, a distribution of the Shares within the meaning of the Securities Act of 1933, as amended (the "1933 Act"). (c) Optionee has no present intention of selling or otherwise disposing of all or any portion of the Shares. (d) Optionee is fully aware of (i) the highly speculative nature of the investment in the Shares; (ii) the financial hazards involved; and (iii) the lack of liquidity of the Shares and the restrictions on transferability of the Shares (e.g., that Optionee may not be able to sell or dispose of the Shares or use them as collateral for loans). (e) Optionee is capable of evaluating the merits and risks of this investment, has the ability to protect Optionee's own interests in this transaction and is financially capable of bearing a total loss of this investment. 4. Compliance with Securities Laws. Optionee under- stands and acknowledges that the Shares have not been regis- tered under the 1933 Act and that, notwithstanding any other provision of the Grant to the contrary, the exercise of any rights to purchase any Shares is expressly conditioned upon compliance with the 1933 Act and all applicable state securities laws. Optionee agrees to cooperate with the Company to ensure compliance with such laws. The Shares are being issued under the 1933 Act pursuant to (the Company will check the applicable box): [ ]the exemption provided by Rule 701; [ ] the exemption provided by Rule 504; [ ] Section 4(2) of the 1933 Act; [ ] other:_______________________. 5. Federal Restrictions on Transfer. Optionee understands that the Shares must be held indefinitely unless they are registered under the l933 Act or unless an exemption from such registration is available and that the certificate(s) representing the Shares will bear a legend to that effect. Optionee understands that the Company is under no obligation to register the Shares and that an exemption may not be available or may not permit Optionee to transfer Shares in the amounts or at the times proposed by Optionee. (a) Rule 144. Optionee has been advised that Rule 144 promulgated under the 1933 Act, which permits certain resales of unregistered securities, is not presently available with respect to the Shares and, in any event, requires that the Shares be paid for and then held for a minimum of two years before they may be resold under Rule 144. Prior to an initial public offering of the Company's stock, "nonaffiliates" (i.e. persons other than officers, directors and major shareholders of the Company) may resell only under Rule 144(k), which requires that the Shares be paid for and held for a minimum of three years. Rule 144(k) is not available to affiliates. (b) Rule 701. If the exemption relied upon for exercise of the Shares is Rule 701, the Shares will become freely transferable, subject to limited conditions regarding the method of sale, by nonaffiliates 90 days after the first sale of common stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the SEC, subject to any lengthier market standoff agreement contained in this Agreement or entered into by the Optionee. Affiliates must comply with the provisions (other than the holding period requirements) of Rule 144. 6. State Law Restrictions on Transfer. Optionee understands that transfer of the Shares may be restricted by applicable state laws and that the certificate(s) representing the Shares may bear a legend to that effect. 7. Company's Repurchase Option. (a) Termination Date. Optionee shall be considered to be employed by the Company for all purposes under this Section 7 if Optionee is an officer, director or full-time employee of the Company or any Parent, Subsidiary or Affiliate of the Company or if the Board of Directors determines that Optionee is rendering substantial services as a part-time employee, consultant, contractor or adviser to the Company or any Parent, Subsidiary or Affiliate of the Company. The Board of Directors of the Company shall have discretion to determine whether Optionee has ceased to be employed by the Company or any Parent, Subsidiary or Affiliate of the Company and the effective date on which such employment terminated (the "Termination Date"). (b) Repurchase Option. In the event of Optionee's Termination Date occurring, for any reason whatsoever, including, without limitation, resignation, termination, disability or death (a "Termination of Employment"), Optionee (or Optionee's personal representative) shall immediately offer the Shares to the Company and the Company shall have a first right and option, exercisable within thirty (30) days of such offer, to repurchase the Shares. (c) Repurchase Price. The purchase price of each Share in such a case shall be the "Formula Value per Share." For purposes of this Section 7(c), the Formula Value per Share shall mean the quotient obtained by dividing the "Formula Value" (as defined in the Plan) by the "Outstanding Shares" (as defined in the Plan. (d) Payment of Repurchase Price. The purchase price in the case of any purchase of Shares by the Company pursuant to this Section 7 shall be paid in cash within thirty (30) days of acceptance of the offer described above or within thirty (30) days of such time as audited or unaudited financial statements setting out the information necessary to calculate the purchase price are available, whichever is later, at which time the undersigned shall deliver to the Company the stock certificate or certificates to be duly endorsed for transfer, with the necessary documentary and transfer stamps, if any, paid for and affixed by the undersigned. 8. Right of Termination Unaffected. Nothing in this Agreement shall be construed to limit or otherwise affect in any manner whatsoever the right or power of the Company to terminate Optionee's employment at any time, for any reason or no reason, with or without cause. 9. Legends. Optionee understands and agrees that the Shares are subject to a of repurchase held by the Company (or its assignee) as set forth herein, and certain other rights as are set forth in the Stockholders' Agreement, and that, in addition to the legends described in the Stockholders' Agreement, the certificate(s) representing the Shares will bear legends in substantially the following forms: "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON PUBLIC RESALE AND TRANSFER AND RIGHT OF FIRST REFUSAL AND REPURCHASE OPTIONS HELD BY THE ISSUER AND/OR ITS ASSIGNEE(S) AND MAY NOT BE TRANSFERRED EXCEPT AS SET FORTH IN AN AGREEMENT 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 AND REPURCHASE ARE BINDING ON TRANSFEREES OF THESE SHARES." "THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE SECURITIES ACT OR, IN THE OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURI TIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH." 10. Stop-Transfer Notices. Optionee understands and agrees that, in order to ensure compliance with the restric- tions 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. 11. Tax Consequences. 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 CONSULTANT(s) 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. IN PARTICULAR, IF OPTIONEE IS AN INSIDER SUBJECT TO SECTION 16(b) OF THE SECURITIES EXCHANGE ACT OF 1934, OPTIONEE REPRESENTS THAT OPTIONEE HAS CONSULTED WITH OPTIONEE'S TAX ADVISERS CONCERNING THE ADVISABILITY OF FILING AN 83(b) ELECTION WITH THE INTERNAL REVENUE SERVICE. 12. Entire Agreement. The Plan, Grant and Stockholders' Agreement are incorporated herein by reference. This Agreement, the Plan and the Grant constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and is governed by Connecticut law except for that body of law pertaining to conflict of laws. Submitted by: Accepted by: OPTIONEE: TSI INTERNATIONAL SOFTWARE LTD. (print name) ___________________ By:_________________________________ (signature) Its: Dated: Dated: EX-4.6 4 b47765asexv4w6.txt EX-4.6 NOVERA SOFTWARE INC 1996 STOCK OPTION PLAN EXHIBIT 4.6 NOVERA SOFTWARE, INC. 1996 STOCK OPTION PLAN 1. Purpose. The purpose of this plan (the "Plan") is to secure for Novera Software, Inc. (the "Company") and its shareholders the benefits arising from capital stock ownership by employees, officers and directors of, and consultants or advisors to, the Company and its parent and subsidiary corporations who are expected to contribute to the Company's future growth and success. Except where the context otherwise requires, the term "Company" shall include the parent and all present and future subsidiaries of the Company as defined in Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended or replaced from time to time (the "Code"). Those provisions of the Plan which make express reference to Section 422 shall apply only to Incentive Stock Options (as that term is defined in the Plan). 2. Type of Options and Administration. (a) Types of Options. Options granted pursuant to the Plan may be either incentive stock options ("Incentive Stock Options") meeting the requirements of Section 422 of the Code or Non-Statutory Options which are not intended to meet the requirements of Section 422 of the Code ("Non-Statutory Options"). (b) Administration. (i) The Plan will be administered by the Board of Directors of the Company, whose construction and interpretation of the terms and provisions of the Plan shall be final and conclusive. The Board of Directors may in its sole discretion grant options to purchase shares of the Company's Common Stock ("Common Stock") and issue shares upon exercise of such options as provided in the Plan. The Board shall have authority, subject to the express provisions of the Plan, to construe the respective option agreements and the Plan, to prescribe, amend and rescind rules and regulations relating to the Plan, to determine the terms and provisions of the respective option agreements, which need not be identical, and to make all other determinations which are, in the judgment of the Board of Directors, necessary or desirable for the administration of the Plan. The Board of Directors may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any option agreement in the manner and to the extent it shall deem expedient to carry the Plan into effect and it shall be the sole and final judge of such expediency. No director or person acting pursuant to authority delegated by the Board of Directors shall be liable for any action or determination under the Plan made in good faith. (ii) The Board of Directors may, to the full extent permitted by or consistent with applicable laws or regulations and Section 3(b) of this Plan delegate any or all of its powers under the Plan to a committee (the "Committee") appointed by the Board of Directors, and if the Committee is so appointed all references to the Board of Directors in the Plan shall mean and relate to such Committee. (c) Applicability of Rule 16b-3. Those provisions of the Plan which make express reference to Rule 16b-3 promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), or any successor rule ("Rule 16b-3"), or which are required in order for certain option transactions to qualify for exemption under Rule 16b-3, shall apply only to such persons as are required to file reports under Section 16(a) of the Exchange Act (a "Reporting Person"). 3. Eligibility. (a) General. Options may be granted to persons who are, at the time of grant, employees, officers or directors of, or consultants or advisors to, the Company; provided, that the class of employees to whom Incentive Stock Options may be granted shall be limited to all employees of the Company. A person who has been granted an option may, if he or she is otherwise eligible, be granted additional options if the Board of Directors shall so determine. Subject to adjustment as provided in Section 15 below, the maximum number of shares with respect to which options may be granted to any employee under the Plan shall not exceed 600,000 shares of common stock during the ten-year term of the Plan. For the purpose of calculating such maximum number, (a) an option shall continue to be treated as outstanding notwithstanding its repricing, cancellation or expiration and (b) the repricing of an outstanding option or the issuance of a new option in substitution for a cancelled option shall be deemed to constitute the grant of a new additional option separate from the original grant of the option that is repriced or cancelled. (b) Grant of Options to Directors and Officers. From and after the registration of the Common Stock of the Company under the Exchange Act, the selection of a director or an officer (as the terms "director" and "officer" are defined for purposes of Rule 16b-3) as a recipient of an option, the timing of the option grant, the exercise price of the option and the number of shares subject to the option shall be determined either (i) by the Board of Directors, of which all members shall be "disinterested persons" (as hereinafter defined), or (ii) by two or more directors having full authority to act in the matter, each of whom shall be a "disinterested person." For the purposes of the Plan, a director shall be deemed to be a "disinterested person" only if such person qualifies as a "disinterested person" within the meaning of Rule 16b-3, as such term is interpreted from time to time. 4. Stock Subject to Plan. Subject to adjustment as provided in Section 15 below, the maximum number of shares of Common Stock which may be issued and sold under the Plan is one million twelve thousand (1,012,000) shares. If an option granted under the Plan shall expire or terminate for any reason without having been exercised in full, the unpurchased shares subject to such option shall again be available for subsequent option grants under the Plan. If shares issued upon exercise of an option under the Plan are tendered to the Company in payment of the exercise price of an option granted under the Plan, such tendered shares shall again be available for subsequent option grants under the Plan; provided, that in no event shall such shares be made available for issuance to Reporting Persons or pursuant to exercise of Incentive Stock Options. 5. Forms of Option Agreements. As a condition to the grant of an option under the Plan, each recipient of an option shall execute an option agreement in such form not inconsistent with the Plan as may be approved by the Board of Directors. Such option agreements may differ among recipients. 6. Purchase Price. (a) General. Subject to Section 3(b), the purchase price per share of stock deliverable upon the exercise of an option shall be determined by the Board of Directors, provided, however, that in the case of an Incentive Stock Option, the exercise price shall not be less than 100% of the fair market value of such stock, as determined by the Board of Directors, at the time of grant of such option, or less than 110% of such fair market value in the case of options described in Section 11(b). (b) Payment of Purchase Price. Options granted under the Plan may provide for the payment of the exercise price by delivery of cash or a check to the order of the Company in an amount equal to the exercise price of such options, or, to the extent provided in the applicable option agreement, (i) by delivery to the Company of shares of Common Stock of the Company already owned by the optionee having a fair market value equal in amount to the exercise price of the options being exercised, or (ii) by any other means (including, without limitation, by delivery of a promissory note of the optionee payable on such terms as are specified by the Board of Directors) which the Board of Directors determines are consistent with the purpose of the Plan and with applicable laws and regulations (including, without limitation, the provisions of Regulation T promulgated by the Federal Reserve Board). The fair market value of any shares of the Company's Common Stock or other non-cash consideration which may be delivered upon exercise of an option shall be determined by the Board of Directors. 7. Option Period. Each option and all rights thereunder shall expire on such date as shall be set forth in the applicable option agreement, except that, in the case of an Incentive Stock Option, such date shall not be later than ten years after the date on which the option is granted and, in all cases, options shall be subject to earlier termination as provided in the Plan. 8. Exercise of Options. Each option granted under the Plan shall be exercisable either in full or in installments at such time or times and during such period as shall be set forth in the agreement evidencing such option, subject to the provisions of the Plan. 9. Nontransferability of Options. Options shall not be assignable or transferable by the person to whom they are granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the life of the optionee, shall be exercisable only by the optionee; provided, however, that Non-Statutory Options may be transferred pursuant to a qualified domestic relations order (as defined in Rule 16b-3). 10. Effect of Termination of Employment or Other Relationship. Except as provided in Section 11(d) with respect to Incentive Stock Options, and subject to the provisions of the Plan, the Board of Directors shall determine the period of time during which an optionee may exercise an option following (i) the termination of the optionee's employment or other relationship with the Company, or (ii) the death or disability of the optionee. Such periods shall be set forth in the agreement evidencing such option. 11. Incentive Stock Options. Options granted under the Plan which are intended to be Incentive Stock Options shall be subject to the following additional terms and conditions: (a) Express Designation. All Incentive Stock Options granted under the Plan shall, at the time of grant, be specifically designated as such in the option agreement covering such Incentive Stock Options. (b) 10% Shareholder. If any employee to whom an Incentive Stock Option is to be granted under the Plan is, at the time of the grant of such option, the owner of stock possessing more than 10% of the total combined voting power of all classes of stock of the Company (after taking into account the attribution of stock ownership rules of Section 424(d) of the Code), then the following special provisions shall be applicable to the Incentive Stock Option granted to such individual: (i) The purchase price per share of the Common Stock subject to such Incentive Stock Option shall not be less than 110% of the fair market value of one share of Common Stock at the time of grant; and (ii) The option exercise period shall not exceed five years from the date of grant. (c) Dollar Limitation. For so long as the Code shall so provide, options granted to any employee under the Plan (and any other incentive stock option plans of the Company) which are intended to constitute Incentive Stock Options shall not constitute Incentive Stock Options to the extent that such options, in the aggregate, become exercisable for the first time in any one calendar year for shares of Common Stock with an aggregate fair market value (determined as of the respective date or dates of grant) of more than $100,000. (d) Termination of Employment, Death or Disability. No Incentive Stock Option may be exercised unless, at the time of such exercise, the optionee is, and has been continuously since the date of grant of his or her option, employed by the Company, except that: (i) an Incentive Stock Option may be exercised within the period of three months after the date the optionee ceases to be an employee of the Company (or within such lesser period as may be specified in the applicable option agreement), provided, that the agreement with respect to such option may designate a longer exercise period and that the exercise after such three- month period shall be treated as the exercise of a non-statutory option under the Plan; (ii) if the optionee dies while in the employ of the Company, or within three months after the optionee ceases to be such an employee, the Incentive Stock Option may be exercised by the person to whom it is transferred by will or the laws of descent and distribution within the period of one year after the date of death (or within such lesser period as may be specified in the applicable option agreement); and (iii) if the optionee becomes disabled (within the meaning of Section 22(e)(3) of the Code or any successor provision thereto) while in the employ of the Company, the Incentive Stock Option may be exercised within the period of one year after the date the optionee ceases to be such an employee because of such disability (or within such lesser period as may be specified in the applicable option agreement). For all purposes of the Plan and any option granted hereunder, "employment" shall be defined in accordance with the provisions of Section 1.421-7(h) of the Income Tax Regulations (or any successor regulations). Notwithstanding the foregoing provisions, no Incentive Stock Option may be exercised after its expiration date. 12. Additional Provisions. (a) Additional Option Provisions. The Board of Directors may, in its sole discretion, include additional provisions in option agreements covering options granted under the Plan, including without limitation restrictions on transfer, repurchase rights, commitments to pay cash bonuses, to make, arrange for or guaranty loans or to transfer other property to optionees upon exercise of options, or such other provisions as shall be determined by the Board of Directors; provided that such additional provisions shall not be inconsistent with any other term or condition of the Plan and such additional provisions shall not cause any Incentive Stock Option granted under the Plan to fail to qualify as an Incentive Stock Option within the meaning of Section 422 of the Code. (b) Acceleration, Extension, Etc. The Board of Directors may, in its sole discretion, (i) accelerate the date or dates on which all or any particular option or options granted under the Plan may be exercised, or (ii) extend the dates during which all, or any particular, option or options granted under the Plan may be exercised. 13. General Restrictions. (a) Investment Representations. The Company may require any person to whom an option is granted, as a condition of exercising such option, to enter into an agreement providing rights of first refusal with respect to the transfer of the Common Stock to be acquired, to give written assurances in substance and form satisfactory to the Company to the effect that such person is acquiring the Common Stock subject to the option for his or her own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate in order to comply with state securities laws, or with covenants or representations made by the Company in connection with any public offering of its Common Stock. (b) Compliance With Securities Laws. Each option shall be subject to the requirement that if, at any time, counsel to the Company shall determine that the listing, registration or qualification of the shares subject to such option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, or that the disclosure of non-public information or the satisfaction of any other condition is necessary as a condition of, or in connection with, the issuance or purchase of shares thereunder, such option may not be exercised, in whole or in part, unless such listing, registration, qualification, consent or approval, or satisfaction of such condition shall have been effected or obtained on conditions acceptable to the Board of Directors. Nothing herein shall be deemed to require the Company to apply for or to obtain such listing, registration or qualification, or to satisfy such condition. 14. Rights as a Shareholder. The holder of an option shall have no rights as a shareholder with respect to any shares covered by the option (including, without limitation, any rights to receive dividends or non-cash distributions with respect to such shares) until the date of issue of a stock certificate to him or her for such shares. No adjustment shall be made for dividends or other rights for which the record date is prior to the date such stock certificate is issued. 15. Adjustment Provisions for Recapitalizations and Related Transactions. (a) General. If, through or as a result of any merger, consolidation, sale of all or substantially all of the assets of the Company, reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction, (i) the outstanding shares of Common Stock are increased, decreased or exchanged for a different number or kind of shares or other securities of the Company, or (ii) additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such shares of Common Stock or other securities, an appropriate and proportionate adjustment may be made in (x) the maximum number and kind of shares reserved for issuance under the Plan, (y) the number and kind of shares or other securities subject to any then outstanding options under the Plan, and (z) the price for each share subject to any then outstanding options under the Plan, without changing the aggregate purchase price as to which such options remain exercisable. Notwithstanding the foregoing, no adjustment shall be made pursuant to this Section 15 if such adjustment would cause the Plan to fail to comply with Section 422 of the Code. (b) Board Authority to Make Adjustments. Any adjustments under this Section 15 will be made by the Board of Directors, whose determination as to what adjustments, if any, will be made and the extent thereof will be final, binding and conclusive. No fractional shares will be issued under the Plan on account of any such adjustments. 16. Merger, Consolidation, Asset Sale, Liquidation, etc. (a) General. In the event of a consolidation or merger or sale of all or substantially all of the assets of the Company in which outstanding shares of Common Stock are exchanged for securities, cash or other property of any other corporation or business entity or in the event of a liquidation of the Company, the Board of Directors of the Company, or the board of directors of any corporation assuming the obligations of the Company, may, in its discretion, take any one or more of the following actions, as to outstanding options: (i) provide that such options shall be assumed, or equivalent options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof), provided that any such options substituted for Incentive Stock Options shall meet the requirements of Section 424(a) of the Code, (ii) upon written notice to the optionees, provide that all unexercised options will terminate immediately prior to the consummation of such transaction unless exercised by the optionee within a specified period following the date of such notice, (iii) in the event of a merger under the terms of which holders of the Common Stock of the Company will receive upon consummation thereof a cash payment for each share surrendered in the merger (the "Merger Price"), make or provide for a cash payment to the optionees equal to the difference between (A) the Merger Price times the number of shares of Common Stock subject to such outstanding options (to the extent then exercisable at prices not in excess of the Merger Price) and (B) the aggregate exercise price of all such outstanding options in exchange for the termination of such options, and (iv) provide that all or any outstanding options shall become exercisable in full immediately prior to such event. (b) Substitute Options. The Company may grant options under the Plan in substitution for options held by employees of another corporation who become employees of the Company, or a subsidiary of the Company, as the result of a merger or consolidation of the employing corporation with the Company or a subsidiary of the Company, or as a result of the acquisition by the Company, or one of its subsidiaries, of property or stock of the employing corporation. The Company may direct that substitute options be granted on such terms and conditions as the Board of Directors considers appropriate in the circumstances. 17. No Special Employment Rights. Nothing contained in the Plan or in any option shall confer upon any optionee any right with respect to the continuation of his or her employment by the Company or interfere in any way with the right of the Company at any time to terminate such employment or to increase or decrease the compensation of the optionee. 18. Other Employee Benefits. Except as to plans which by their terms include such amounts as compensation, the amount of any compensation deemed to be received by an employee as a result of the exercise of an option or the sale of shares received upon such exercise will not constitute compensation with respect to which any other employee benefits of such employee are determined, including, without limitation, benefits under any bonus, pension, profit-sharing, life insurance or salary continuation plan, except as otherwise specifically determined by the Board of Directors. 19. Amendment of the Plan. (a) The Board of Directors may at any time, and from time to time, modify or amend the Plan in any respect, except that if at any time the approval of the shareholders of the Company is required under Section 422 of the Code or any successor provision with respect to Incentive Stock Options, or under Rule 16b- 3, the Board of Directors may not effect such modification or amendment without such approval. (b) The termination or any modification or amendment of the Plan shall not, without the consent of an optionee, affect his or her rights under an option previously granted to him or her. With the consent of the optionee affected, the Board of Directors may amend outstanding option agreements in a manner not inconsistent with the Plan. The Board of Directors shall have the right to amend or modify (i) the terms and provisions of the Plan and of any outstanding Incentive Stock Options granted under the Plan to the extent necessary to qualify any or all such options for such favorable federal income tax treatment (including deferral of taxation upon exercise) as may be afforded incentive stock options under Section 422 of the Code, and (ii) the terms and provisions of the Plan and of any outstanding option to the extent necessary to ensure the qualification of the Plan under Rule 16b-3. 20. Withholding. (a) The Company shall have the right to deduct from payments of any kind otherwise due to the optionee any federal, state or local taxes of any kind required by law to be withheld with respect to any shares issued upon exercise of options under the Plan. Subject to the prior approval of the Company, which may be withheld by the Company in its sole discretion, the optionee may elect to satisfy such obligations, in whole or in part, (i) by causing the Company to withhold shares of Common Stock otherwise issuable pursuant to the exercise of an option, or (ii) by delivering to the Company shares of Common Stock already owned by the optionee. The shares so delivered or withheld shall have a fair market value equal to such withholding obligation. The fair market value of the shares used to satisfy such withholding obligation shall be determined by the Company as of the date that the amount of tax to be withheld is to be determined. An optionee who has made an election pursuant to this Section 20(a) may only satisfy his or her withholding obligation with shares of Common Stock which are not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements. (b) Notwithstanding the foregoing, in the case of a Reporting Person, no election to use shares for the payment of withholding taxes shall be effective unless made in compliance with any applicable requirements of Rule 16b-3 (unless it is intended that the transaction not qualify for exemption under Rule 16b-3). 21. Cancellation and New Grant of Options, Etc. The Board of Directors shall have the authority to effect, at any time and from time to time, with the consent of the affected optionees, (i) the cancellation of any or all outstanding options under the Plan and the grant in substitution therefor of new options under the Plan covering the same or different numbers of shares of Common Stock and having an option exercise price per share which may be lower or higher than the exercise price per share of the cancelled options, or (ii) the amendment of the terms of any and all outstanding options under the Plan to provide an option exercise price per share which is higher or lower than the then-current exercise price per share of such outstanding options. 22. Effective Date and Duration of the Plan. (a) Effective Date. The Plan shall become effective when adopted by the Board of Directors, but no option granted under the Plan shall become exercisable unless and until the Plan shall have been approved by the Company's shareholders. If such shareholder approval is not obtained within twelve months after the date of the Board's adoption of the Plan, options previously granted under the Plan shall not vest and shall terminate and no options shall be granted thereafter. Amendments to the Plan not requiring shareholder approval shall become effective when adopted by the Board of Directors; amendments requiring shareholder approval (as provided in Section 19) shall become effective when adopted by the Board of Directors, but no option granted after the date of such amendment shall become exercisable (to the extent that such amendment to the Plan was required to enable the Company to grant such option to a particular person) unless and until such amendment shall have been approved by the Company's shareholders. If such shareholder approval is not obtained within twelve months of the Board's adoption of such amendment, any options granted on or after the date of such amendment shall terminate to the extent that such amendment was required to enable the Company to grant such option to a particular optionee. Subject to this limitation, options may be granted under the Plan at any time after the effective date and before the date fixed for termination of the Plan. (b) Termination. Unless sooner terminated in accordance with Section 16, the Plan shall terminate upon the close of business on the day next preceding the tenth anniversary of the date of its adoption by the Board of Directors. Options outstanding on such date shall continue to have force and effect in accordance with the provisions of the instruments evidencing such options. 23. Provision for Foreign Participants. The Board of Directors may, without amending the Plan, modify awards or options granted to participants who are foreign nationals or employed outside the United States to recognize differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters. Adopted by the Board of Directors on August 1, 1996. EX-4.7 5 b47765asexv4w7.txt EX-4.7 MERCATOR SOFTWARE INC 1997 EQUITY INC PLAN EXHIBIT 4.7 MERCATOR SOFTWARE, INC. 1997 EQUITY INCENTIVE PLAN As Adopted May 8, 1997 and Amended July 21, 1997, January 27, 1999, March 17, 1999, May 18, 1999, April 3, 2000, June 19, 2000, May 17, 2001, August 15, 2001 and May 14, 2002 1. PURPOSE. The purpose of this Plan is to provide incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of the Company, its Parent and Subsidiaries, by offering them an opportunity to participate in the Company's future performance through awards of Options, Restricted Stock and Stock Bonuses. Capitalized terms not defined in the text are defined in Section 23. 2. SHARES SUBJECT TO THE PLAN. 2.1 Number of Shares Available. Subject to Sections 2.2 and 18, the total number of Shares reserved and available for grant and issuance pursuant to Awards made under this Plan will be 12,200,000 Shares until December 31, 2002. On January 1, 2003, the total number of Shares reserved and available for grant and issuance pursuant to Awards made under this Plan will be increased by the lesser of (a) 7.5% of the number of Shares outstanding on the close of business immediately preceding January 1, 2003, or (b) 3,000,000 Shares. Subject to Sections 2.2 and 18, Shares will again be available for grant and issuance in connection with future Awards under the Plan if the shares: (a) are subject to issuance upon exercise of an Option but cease to be subject to such Option for any reason other than exercise of such Option; (b) are subject to an Award granted hereunder but are forfeited or are repurchased by the Company at the original issue price; or (c) are subject to an Award that otherwise terminates without Shares being issued. Any authorized shares not issued or subject to outstanding grants under the Company's 1993 Stock Option Plan (the "Prior Plan") on the Effective Date (as defined below) and any shares that: (a) are issuable upon exercise of options granted pursuant to the Prior Plan that expire or become unexercisable for any reason without having been exercised in full or (b) are subject to an option granted pursuant to the Prior Plan but are forfeited or are repurchased by the Company at the original issue price; will no longer be available for grant and issuance under the Prior Plan, but will be available for grant and issuance under this Plan. At all times the Company shall reserve and keep available a sufficient number of Shares as shall be required to satisfy the requirements of all outstanding Options granted under this Plan and all other outstanding but unvested Awards granted under this Plan. No Participant may receive (a) Restricted Stock Awards, (b) Stock Bonus Awards, or (c) Options with an Exercise Price below Fair Market Value for more than 150,000 Shares over the term of the Plan, and the sum of such awards issued under this Plan may not exceed 300,000 Shares in the aggregate over the term of the Plan. 2.2 Adjustment of Shares. In the event that the number of outstanding Shares is changed by a stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration, then (a) the number of Shares reserved for issuance under this Plan, (b) the Exercise Prices of and number of Shares subject to outstanding Options, and (c) the number of Shares subject to other outstanding Awards will be proportionately adjusted, subject to any required action by the Board or the stockholders of the Company and compliance with applicable securities laws; provided, however, that fractions of a Share will not be issued but will either be replaced by a cash payment equal to the Fair Market Value of such fraction of a Share or will be rounded up to the nearest whole Share, as determined by the Committee. 3. ELIGIBILITY. ISO (as defined in Section 5 below) may be granted only to employees (including officers and directors who are also employees) of the Company or of a Parent or Subsidiary of the Company. All other Awards may be granted to employees, officers, directors, consultants, independent contractors and advisors of the Company or any Parent or Subsidiary of the Company; provided such consultants, contractors and advisors render bona fide services not in connection with the offer and sale of securities in a capital-raising transaction. No person will be eligible to receive more than 300,000 Shares in any calendar year under this Plan pursuant to the grant of Awards hereunder, other than new employees of the Company or of a Parent or Subsidiary of the Company (including new employees who are also officers and directors of the Company or any Parent or Subsidiary of the Company) who are eligible to receive up to a maximum of 1,000,000 Shares in the calendar year in which they commence their employment. A person may be granted more than one Award under this Plan. 4. ADMINISTRATION. 4.1 Committee Authority. This Plan will be administered by the Committee. Subject to the general purposes, terms and conditions of this Plan, the Committee will have full power to implement and carry out this Plan. Without limiting the previous sentence, the Committee will have the authority to: (a) construe and interpret this Plan, any Award Agreement and any other agreement or document executed pursuant to this Plan; (b) prescribe, amend and rescind rules and regulations relating to this Plan, including determining the forms and agreements used in connection with this Plan; provided that the Committee may delegate to the President and Chief Executive Officer or the Chief Financial Officer, the authority to approve revisions to the forms and agreements used in connection with this Plan that are designed to facilitate Plan administration, and that are not inconsistent with this Plan or with any resolutions of the Committee relating to this Plan; (c) select persons to receive Awards; provided that the Committee may delegate to one or more executive officers of the Company who are also members of the Board, the authority to grant an Award under this Plan to Participants who are not Insiders of the Company; (d) determine the terms of Awards; (e) determine the number of Shares or other consideration subject to Awards; (f) determine whether Awards will be granted singly, in combination or in tandem with, in replacement of, or as alternatives to, other Awards under this Plan or any other incentive or compensation plan of the Company or any Parent or Subsidiary of the Company; (g) grant waivers of Plan or Award conditions; (h) determine the vesting, exercisability and payment of Awards; -2- (i) correct any defect, supply any omission or reconcile any inconsistency in this Plan, any Award or any Award Agreement; (j) determine whether an Award has been earned; and (k) amend this Plan, except for amendments that increase the number of Shares available for issuance under this Plan or change the eligibility criteria for participation in this Plan, or any other amendments that would require approval of the stockholders of the Company; (l) make all other determinations necessary or advisable for the administration of this Plan. 4.2 Committee Interpretation and Discretion. Any determination made by the Committee with respect to any Award will be made in its sole discretion at the time of grant of the Award or, unless in contravention of any express term of this Plan or Award, at any later time, and such determination will be final and binding on the Company and on all persons having an interest in any Award under this Plan. Any dispute regarding the interpretation of this Plan or any award Agreement shall be submitted by the participant or the Company to the Committee for review. The resolution of such a dispute by the Committee shall be final and binding on the Company and the Participant. 5. OPTIONS. The Committee may grant Options to eligible persons and will determine whether such Options will be Incentive Stock Options within the meaning of the Code ("ISO") or Non-Qualified Stock Options ("NQSO"), the number of Shares subject to the Option, the Exercise Price of the Option, the period during which the Option may be exercised, and all other terms and conditions of the Option, subject to the following: 5.1 Form of Option Grant. Each Option granted under this Plan will be evidenced by an Award Agreement which will expressly identify the Option as an ISO or an NQSO ("Stock Option Agreement"). The Stock Option Agreement will be substantially in a form (which need not be the same for each Participant) that the Committee or an officer of the Company (pursuant to Section 41(b)) has from time to time approved, and will comply with and be subject to the terms and conditions of this Plan. 5.2 Date of Grant. The date of grant of an Option will be the date on which the Committee makes the determination to grant such Option, unless a later date is otherwise specified by the Committee. The Stock Option Agreement and a copy of this Plan will be delivered to the Participant within a reasonable time after the granting of the Option. 5.3 Exercise Period. Options may be exercisable within the times or upon the occurrence of events determined by the Committee and set forth in the Stock Option Agreement governing such Option; subject to the provisions of Section 5.6 and subject to Company policies established by the Committee (or by individuals to whom the Committee has delegated responsibility) from time to time with respect to vesting during leaves of absences. No Option will be exercisable after the expiration of ten (10) years from the date the Option is granted; provided however that no ISO granted to a person who directly or by attribution owns more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of any Parent or Subsidiary of the Company ("Ten Percent Stockholder") will be exercisable after the expiration of five (5) years from the date the ISO is granted. The Committee also may provide for Options to become exercisable at one time or from time to time, periodically or otherwise, in such number of Shares or percentage of Shares as the Committee determines. -3- 5.4 Exercise Price. The Exercise Price of an Option will be determined by the Committee when the Option is granted and may not be less than 85% of the Fair Market Value of the Shares on the date of grant; provided that: (i) the Exercise Price of an ISO will not be less than 100% of the Fair Market Value of the Shares on the date of grant; and (ii) the Exercise Price of any ISO granted to a Ten Percent Stockholder will not be less than 110% of the Fair Market Value of the Shares on the date of grant. Payment for the Shares purchased must be made in accordance with Section 8 of this Plan and the Stock Option Agreement. 5.5 Method of Exercise. Options may be exercised only by delivery to the Company of a written stock option exercise agreement (the "Exercise Agreement"). The Exercise Agreement will be substantially in a form (which need not be the same for each Participant), that the Committee or an Officer of the Company (pursuant to Section 4.1(b)) has from time to time approved and shall state the number of Shares being purchased, the restrictions imposed on the Shares purchased under such Exercise Agreement, if any, and such representations and agreements regarding Participant's investment intent and access to information and other matters, if any, as may be required or desirable by the Company to comply with applicable securities laws, together with payment in full of the Exercise Price for the number of shares being purchased. 5.6 Termination. (a) Termination for Other than Cause. An Option granted to a Participant will cease to vest on the Participant's Termination. Following the Participant's Termination, the Participant's Option may be exercised (to the extent such Option was exercisable immediately prior to the Termination Date): (i) no later than three (3) months after the Termination Date if the Participant is Terminated for any reason except death or Disability, unless a shorter or longer time period not exceeding five (5) years is specifically set forth in the Participant's Stock Option Agreement; provided that any exercise of an ISO more than three (3) months after the Termination Date is deemed to be an NQSO, and provided further than no Option may be exercised later than the expiration date of the Option. (ii) no later than twelve (12) months after the Termination Date if the Participant is Terminated because of Participant's death or Disability (or the Participant dies within three (3) months after a Termination other than because of Participant's death or Disability), unless a shorter or longer time period not exceeding five (5) years is specifically set forth in the Participant's Stock Option Agreement; provided that any exercise of an ISO more than twelve (12) months after the Termination Date when the Termination is for Participant's Disability is deemed to be an NQSO, and provided further that no option may be exercised later than the expiration date of the Option. (b) Termination for Cause. Notwithstanding the provisions in paragraph 5.6(a) above, if a Participant is determined by the Board to have committed an act of theft, embezzlement, fraud, dishonesty or a breach of fiduciary duty to the Company or Subsidiary, neither the Participant, the Participant's estate nor such other person who may then hold the Option shall be entitled to exercise any Option with respect to any Shares whatsoever, after termination of service, whether or not after termination of service the Participant may receive payment from the Company or Subsidiary for vacation pay, for services rendered prior to termination, for services rendered for the day on which termination occurs, for salary in lieu of notice, or for any other benefits. In making such determination, the Board shall give the Participant an opportunity to present to the Board evidence on his behalf. For -4- the purpose of this paragraph, termination of service shall be deemed to occur on the date when the Company dispatches notice or advice to the Participant that his service is terminated. 5.7 Limitations on Exercise. The Committee may specify a reasonable minimum number of Shares that may be purchased on any exercise of an Option, provided that such minimum number will not prevent Participant from exercising the Option for the full number of Shares for which it is then exercisable. 5.8 Limitations on ISO. The aggregate Fair Market Value (determined as of the date of grant) of Shares with respect to which ISO are exercisable for the first time by a Participant during any calendar year (under this Plan or under any other incentive stock option plan of the Company, Parent or Subsidiary of the Company) will not exceed $100,000. If the Fair Market Value of Shares on the date of grant with respect to which ISO are exercisable for the first time by a Participant during any calendar year exceeds $100,000, then the Options for the first $100,000 worth of Shares to become exercisable in such calendar year will be ISO and the Options for the amount in excess of $100,000 that become exercisable in that calendar year will be NQSO. In the event that the Code or the regulations promulgated thereunder are amended after the Effective Date of this Plan to provide for a different limit on the Fair Market Value of Shares permitted to be subject to ISO, such different limit will be automatically incorporated herein and will apply to any Options granted after the effective date of such amendment. 5.9 Modification, Extension or Renewal. The Committee may modify, extend or renew outstanding Options and authorize the grant of new Options in substitution therefor, provided that any such action may not, without the written consent of a Participant, impair any of such Participant's rights under any Option previously granted. Any outstanding ISO that is modified, extended, renewed or otherwise altered will be treated in accordance with Section 424(h) of the Code. The Committee may reduce the Exercise Price of outstanding Options without the consent of Participants affected by a written notice to them; provided, however, that the Exercise Price may not be reduced below the minimum Exercise Price that would be permitted under Section 5.4 of this Plan for Options granted on the date the action is taken to reduce the Exercise Price. 5.10 No Disqualification. Notwithstanding any other provision in this Plan, no term of this Plan relating to ISO will be interpreted, amended or altered, nor will any discretion or authority granted under this Plan be exercised, so as to disqualify this Plan under Section 422 of the Code or, without the consent of the Participant affected, to disqualify any ISO under Section 422 of the Code. 6. RESTRICTED STOCK. A Restricted Stock Award is an offer by the Company to sell to an eligible person Shares that are subject to restrictions. The Committee will determine to whom an offer will be made, the number of Shares the person may purchase, the price to be paid (the "Purchase Price"), the restrictions to which the Shares will be subject, and all other terms and conditions of the Restricted Stock Award, subject to the following: 6.1 Form of Restricted Stock Award. All purchases under a Restricted Stock Award made pursuant to this Plan will be evidenced by an Award Agreement ("Restricted Stock Purchase Agreement") that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan. The offer of Restricted Stock will be accepted by the Participant's execution and delivery of the Restricted Stock Purchase Agreement and full payment for the Shares to the Company within thirty (30) days from the date the Restricted Stock Purchase Agreement is delivered to the person. If such person does not execute and deliver the Restricted Stock Purchase Agreement along with full -5- payment for the Shares to the Company within thirty (30) days, then the offer will terminate, unless otherwise determined by the Committee. 6.2 Purchase Price. The Purchase Price of Shares sold pursuant to a Restricted Stock Award will be determined by the Committee and will be at least 85% of the Fair Market Value of the Shares on the date the Restricted Stock Award is granted, except in the case of a sale to a Ten Percent Stockholder, in which case the Purchase Price will be 100% of the Fair Market Value. Payment of the Purchase Price must be made in accordance with Section 8 of this Plan. 6.3 Restrictions. Restricted Stock Awards will be subject to such restrictions (if any) as the Committee may impose. The Committee may provide for the lapse of such restrictions in installments and may accelerate or waive such restrictions, in whole or part, based on length of service, performance or such other factors or criteria as the Committee may determine. 7. STOCK BONUSES. 7.1 Awards of Stock Bonuses. A Stock Bonus is an award of Shares (which may consist of Restricted Stock) for services rendered to the Company or any Parent or Subsidiary of the Company. A Stock Bonus may be awarded for past services already rendered to the Company, or any Parent or Subsidiary of the Company (provided that the Participant pays the Company the par value of the shares awarded by such Stock Bonus in cash) pursuant to an Award Agreement (the "Stock Bonus Agreement") that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan. A Stock Bonus may be awarded upon satisfaction of such performance goals as are set out in advance in the Participant's individual Award Agreement (the "Performance Stock Bonus Agreement") that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan. Stock Bonuses may vary from Participant to Participant and between groups of Participants, and may be based upon the achievement of the Company, Parent or Subsidiary and/or individual performance factors or upon such other criteria as the Committee may determine. 7.2 Terms of Stock Bonuses. The Committee will determine the number of Shares to be awarded to the Participant and whether such Shares will be Restricted Stock. If the Stock Bonus is being earned upon the satisfaction of performance goals pursuant to a Performance Stock Bonus Agreement, then the Committee will determine: (a) the nature, length and starting date of any period during which performance is to be measured (the "Performance Period") for each Stock Bonus; (b) the performance goals and criteria to be used to measure the performance, if any; (c) the number of Shares that may be awarded to the Participant; and (d) the extent to which such Stock Bonuses have been earned. Performance Periods may overlap and Participants may participate simultaneously with respect to Stock Bonuses that are subject to different Performance Periods and different performance goals and other criteria. The number of Shares may be fixed or may vary in accordance with such performance goals and criteria as may be determined by the Committee. The Committee may adjust the performance goals applicable to the Stock Bonuses to take into account changes in law and accounting or tax rules and to make such adjustments as the Committee deems necessary or appropriate to reflect the impact of extraordinary or unusual items, events or circumstances to avoid windfalls or hardships. 7.3 Form of Payment. The earned portion of a Stock Bonus may be paid currently or on a deferred basis with such interest or dividend equivalent, if any, as the Committee may determine. Payment may be made in the form of cash, whole Shares, including Restricted Stock, or a combination thereof, either in a lump sum payment or in installments, all as the Committee will determine. -6- 7.4 Termination During Performance Period. If a Participant is Terminated during a Performance Period for any reason, then such Participant will be entitled to payment (whether in Shares, cash or otherwise) with respect to the Stock Bonus only to the extent earned as of the date of Termination in accordance with the Performance Stock Bonus Agreement, unless the Committee will determine otherwise. 8. PAYMENT FOR SHARE PURCHASES. 8.1 Payment. Payment for Shares purchased pursuant to this Plan may be made by any of the following methods (or any combination of such methods) that are described in the applicable Stock Option Agreement or other Award Agreement and that are permitted by law: (a) in cash (by check); (b) by cancellation of indebtedness of the Company to the Participant; (c) by surrender of shares that either: (1) have been owned by Participant for more than six (6) months and have been paid for within the meaning of SEC Rule 144 (and, if such shares were purchased from the Company by use of a promissory note, such note has been fully paid with respect to such shares); or (2) were obtained by Participant in the public market; (d) by tender of a full recourse promissory note having such terms as may be approved by the Committee and bearing interest at a rate sufficient to avoid imputation of income under Sections 483 and 1274 of the Code; provided, however, that Participants who are not employees or directors of the Company will not be entitled to purchase Shares with a promissory note unless the note is adequately secured by collateral other than the Shares; provided, further, that the portion of the Purchase Price or Exercise Price equal to the par value of the Shares, if any, must be paid in cash; (e) by waiver of compensation due or accrued to the Participant for services rendered; provided, however, that the portion of the Purchase Price or Exercise Price equal to the par value of the Shares, if any, must be paid in cash; or (f) with respect only to purchases upon exercise of an Option, and provided that a public market for the Company's stock exists: (1) through a "same day sale" commitment from the Participant and a broker-dealer that is a member of the National Association of Securities Dealers (a "NASD Dealer") whereby the Participant irrevocably elects to exercise the Option and to sell a portion of the Shares so purchased to pay for the Exercise Price, and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the Exercise Price directly to the Company; or (2) through a "margin" commitment from the Participant and a NASD Dealer whereby the Participant irrevocably elects to exercise the Option and to pledge the Shares so purchased to the NASD Dealer in a margin account as security for a loan from the NASD Dealer in the amount of the Exercise Price, and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the Exercise Price directly to the Company. -7- 8.2 Loan Guarantees. The Committee may, in its sole discretion, help the Participant pay for Shares purchased under this Plan by authorizing a guarantee by the Company of a third-party loan to the Participant. 8.3 Issuance of Shares. Upon payment of the applicable Purchase Price or Exercise Price (or a commitment for payment from the NASD Dealer designated by the Participant in the case of an exercise by means of a "same-day sale" or "margin" commitment), and compliance with other conditions and procedures established by the Company for the purchase of shares, the Company shall issue the Shares registered in the name of Participant (or in the name of the NASD Dealer designated by the Participant in the case of an exercise by means of a "same-day sale" or "margin" commitment) and shall deliver certificates representing the Shares (in physical or electronic form, as appropriate). The Shares may be subject to legends or other restrictions as described in Section 13 of the Plan. 9. WITHHOLDING TAXES. 9.1 Withholding Generally. Whenever Shares are to be issued under Awards granted under this Plan, the Company may require the Participant to pay to the Company an amount sufficient to satisfy federal, state and local withholding tax requirements prior to the delivery of any certificate(s) for the Shares. If a payment in satisfaction of an Award is to be made in cash, the payment will be net of an amount sufficient to satisfy federal, state, and local withholding tax requirements. 9.2 Stock Withholding. When, under applicable tax laws, a Participant incurs tax liability in connection with the exercise or vesting of any Award that is subject to tax withholding and the Participant is obligated to pay the Company the amount required to be withheld, the Committee may in its sole discretion allow the Participant to satisfy the minimum withholding tax obligation by electing to have the Company withhold from the Shares to be issued that number of Shares having a Fair Market Value equal to the minimum amount required to be withheld, determined on the date that the amount of tax to be withheld is to be determined. All elections by a Participant to have Shares withheld for this purpose will be made in accordance with the requirements established by the Committee and must be in writing in a form acceptable to the Committee 10. PRIVILEGES OF STOCK OWNERSHIP. 10.1 Voting and Dividends. No Participant will have any of the rights of a stockholder of the Company with respect to any Shares until the Shares are issued to the Participant. After Shares are issued to the Participant, the Participant will be a stockholder and have all the rights of a stockholder with respect to the Shares; provided, however, that if the Shares are Restricted Stock, any new, additional or different securities the Participant may become entitled to receive with respect to the Shares by virtue of a stock dividend, stock split or any other change in the corporate or capital structure of the Company will be subject to the same restrictions as the Restricted Stock; provided, further, that the Participant will have no right to retain such stock dividends or stock distributions with respect to Shares that are repurchased at the Participant's original Purchase Price pursuant to Section 12. 11. TRANSFERABILITY. Except as set forth below (i) no Option shall be transferable by any Participant other than by will or the laws of descent and distribution and (ii) Options may be exercised during the Participant's lifetime only by the Participant (or, if the Participant is disabled and so long as the Option remains exercisable, by the Participant's duly appointed guardian or other legal representative). However, the Committee may, in its discretion, permit a Participant holding an NQSO to transfer the NQSO to (i) one or more members of his or her immediate family (including the Participant's spouse and lineal descendants and spouses of lineal descendants); (ii) trusts for the benefit -8- of the Participant and/or any person referred to in clause (i); (iii) entities wholly-owned by the Participant and/or any persons or trusts referred to in clauses (i) or (ii); or (iv) charitable organizations) for estate planning purposes. In connection with permitting transfers, the Committee may require that (i) no consideration be given or payment made for any such transfer, (ii) the stock option agreement pursuant to which such NQSO is granted must expressly provide for transferability in a manner consistent with the Plan, and (iii) subsequent transfers of the transferred NQSO shall be prohibited except those in accordance with this Section. Following any such transfer, the NQSO shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, and the transferee of such NQSO shall be subject to the applicable terms of the Plan. The events of Termination of employment set forth in a Participant's Stock Option Agreement shall continue to be applied with respect to the original holder of such NQSO, following which such NQSO shall be exercisable by the transferee only to the extent and for the periods specified in such Stock Option Agreement. 12. RESTRICTIONS ON SHARES. At the discretion of the Committee, the Company may reserve to itself and/or its assignee(s) in the Award Agreement a right to repurchase a portion of or all of a Participant's Shares that are not "vested" (as defined in the Award Agreement) following the Participant's Termination at any time within ninety (90) days after the later of Participant's Termination Date and the date Participant purchases Shares under this Plan, for cash and/or cancellation of purchase money indebtedness, at the Participant's Exercise Price or Purchase Price, as the case may be. 13. CERTIFICATES. All certificates for Shares or other securities delivered under this Plan (whether in physical or electronic form, as appropriate) will be subject to such stock transfer orders, legends and other restrictions that the Committee deems necessary or advisable, including without limitation restrictions under any applicable federal, state or foreign securities law, or any rules, regulations and other requirements of the SEC or any stock exchange or automated quotation system on which the Shares may be listed. 14. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a Participant's Shares, the Committee may require the Participant to deposit all certificates representing Shares, together with stock powers or other instruments of transfer approved by the Committee, appropriately endorsed in blank, with the Company or an agent designated by the Company to hold in escrow until such restrictions have lapsed or terminated, and the Committee may cause a legend or legends referencing such restrictions to be placed on the certificates. Any Participant who is permitted to execute a promissory note as partial or full consideration for the purchase of Shares under this Plan will be required to pledge and deposit with the Company all or part of the Shares so purchased as collateral to secure the payment of Participant's obligation to the Company under the promissory note; provided, however, that the Committee may require or accept other or additional forms of collateral to secure the payment of such obligation and, in any event, the Company will have full recourse against the Participant under the promissory note notwithstanding any pledge of the Participant's Shares or other collateral. In connection with any pledge of the Shares, Participant will be required to execute and deliver a written pledge agreement in such form as the Committee will from time to time approve. The Shares purchased with the promissory note may be released from the pledge on a pro rata basis as the promissory note is paid. 15. EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any time or from time to time, authorize the Company, with the consent of the respective Participants, to issue new Awards in exchange for the surrender and cancellation of any or all outstanding Awards. The Committee may at any time buy from a Participant an Award previously granted with payment in cash, Shares (including Restricted Stock) or other consideration, based on such terms and conditions as the Committee and the Participant may agree. -9- 16. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will not be effective unless such Award is in compliance with all applicable state, federal and foreign securities laws, rules and regulations of any governmental body, and the requirements of any stock exchange or automated quotation system upon which the Shares may then be listed or quoted, as they are in effect on the date of grant of the Award and also on the date of exercise or other issuance. Notwithstanding any other provision in this Plan, the Company will have no obligation to issue or deliver certificates for Shares under this Plan prior to: (a) obtaining any approvals from governmental agencies that the Company determines are necessary or advisable; and/or (b) completion of any registration or other qualification of such Shares under any state, federal or foreign law or ruling of any governmental body that the Company determines to be necessary or advisable. The Company will be under no obligation to register the Shares with the SEC or to effect compliance with the registration, qualification or listing requirements of any state, federal or foreign securities laws, stock exchange or automated quotation system, and the Company will have no liability for any inability or failure to do so. 17. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award granted under this Plan will confer or be deemed to confer on any Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Parent or Subsidiary of the Company or limit in any way the right of the Company or any Parent or Subsidiary of the Company to terminate Participant's employment or other relationship at any time, with or without cause. 18. CORPORATE TRANSACTIONS. 18.1 Assumption or Replacement of Awards by Successor. In the event of (a) a dissolution or liquidation of the Company; (b) a merger or consolidation in which the Company is not the surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the stockholders of the Company or their relative stock holdings and the Awards granted under this Plan are assumed, converted or replaced by the surviving corporation, which assumption will be binding on all Participants); (c) a merger in which the Company is the surviving corporation but after which the stockholders of the Company immediately prior to such merger (other than any stockholder that merges with the Company in such merger, or which owns or controls another corporation that merges, with the Company in such merger) cease to own their shares or other equity interest in the Company; (d) the sale of all or substantially all of the assets of the Company; or (e) the acquisition, sale or transfer of more than 50% of the outstanding shares of the Company by tender offer or similar transaction; any or all outstanding Awards will automatically vest for one additional year and may also be assumed, converted or replaced by the surviving corporation (if any), which assumption, conversion or replacement will be binding on all Participants. The Committee may, in its sole discretion, provide for additional accelerated vesting of any or all Awards that are assumed, converted or replaced by the surviving corporation. In lieu of assuming, converting or replacing such Awards, the surviving corporation may substitute equivalent Awards or provide substantially similar consideration to -10- Participants as was provided to stockholders (after taking into account the existing provisions of the Awards and the one year additional vesting). The surviving corporation may also issue, in place of outstanding Shares of the Company held by the Participant, substantially similar shares or other property subject to repurchase restrictions no less favorable to the Participant. In the event such surviving corporation (if any) refuses to assume or substitute Awards, as provided above, pursuant to a transaction described in this Subsection 18.1, such Awards will automatically vest for one additional year and will expire on such transaction at such time and on such conditions as the Committee will determine, provided, however, that the Committee may, in its sole discretion, provide for additional accelerated vesting of any or all Awards granted pursuant to this Plan. If such accelerated options are not exercised prior to the consummation of the corporate transaction, they shall terminate in accordance with the provisions of this Plan. 18.2 Other Treatment of Awards. Subject to any greater rights granted to Participants under the foregoing provisions of this Section 18, in the event of the occurrence of any transaction described in Section 18.1, any outstanding Awards will be treated as provided in the applicable agreement or plan of merger, consolidation, dissolution, liquidation, sale of assets or other "corporate transaction." 18.3 Assumption of Awards by the Company. The Company, from time to time, also may substitute or assume outstanding awards granted by another company, whether in connection with an acquisition of such other company or otherwise, by either; (a) granting an Award under this Plan in substitution of such other company's award; or (b) assuming such award as if it had been granted under this Plan if the terms of such assumed award could be applied to an Award granted under this Plan. Such substitution or assumption will be permissible if the holder of the substituted or assumed award would have been eligible to be granted an Award under this Plan if the other company had applied the rules of this Plan to such grant. In the event the Company assumes an award granted by another company, the terms and conditions of such award will remain unchanged (except that the exercise price and the number and nature of Shares issuable upon exercise of any such option will be adjusted appropriately pursuant to Section 424(a) of the Code). In the event the Company elects to grant a new Option rather than assuming an existing option, such new Option may be granted with a similarly adjusted Exercise Price. 19. ADOPTION AND STOCKHOLDER APPROVAL. This Plan became effective on the date on which the registration statement filed by the Company with the SEC under the Securities Act registering the initial public offering of the Company's Common Stock is declared effective by the SEC (the "Effective Date"). This Plan was approved by the stockholders of the Company, consistent with applicable laws, within twelve (12) months after the date this Plan was adopted by the Board. 20. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided herein, this Plan will terminate ten (10) years from the date this Plan was adopted by the Board. This Plan and all agreements thereunder shall be governed by and construed in accordance with the laws of the State of Connecticut. 21. AMENDMENT OR TERMINATION OF PLAN. The Board may at any time terminate or amend this Plan in any respect, including without limitation amendment of any form of Award Agreement or instrument to be executed pursuant to this Plan. In addition, pursuant to Section 4.1(k), the Board has delegated to the Committee the authority to make certain amendments to this Plan. Notwithstanding the foregoing, neither the Board nor the Committee shall without the approval of the stockholders of the Company amend this Plan in any manner that requires such stockholder approval pursuant to the Code or the regulation promulgated thereunder as such provisions -11- apply to ISO plans, pursuant to the Exchange Act or any rule promulgated thereunder or any rules or regulations promulgated by the Stock exchange or automated quotation system on which the Company's Stock is quoted. No amendment that is detrimental to a Participant may be made to any outstanding Award without the consent of the Participant. 22. NON-EXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by the Board, the submission of this Plan to the stockholders of the Company for approval, nor any provision of this Plan will be construed as creating any limitations on the power of the Board to adopt such additional compensation arrangements as it may deem desirable, including, without limitation, the granting of stock options and bonuses otherwise than under this Plan, and such arrangements may be either generally applicable or applicable only in specific cases. 23. DEFINITIONS. As used in this Plan, the following terms will have the following meanings: "Award" means any award under this Plan, including any Option, Restricted Stock or Stock Bonus. "Award Agreement" means, with respect to each Award, the signed written agreement between the Company and the Participant setting forth the terms and conditions of the Award. "Board" means the Board of Directors of the Company. "Code" means the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder. "Committee" means the committee appointed by the Board to administer this Plan, or if no such committee is appointed, the Board. The Committee, if appointed, will consist of not less than two members of the Board. "Company" means Mercator Software, Inc. or any successor corporation. "Disability" means a disability within the meaning of Section 22(e)(3) of the Code, as determined by the Committee. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Exercise Price" means the price at which a holder of an Option may purchase the Shares issuable upon exercise of the Option. "Fair Market Value" means, as of any date, the value of a share of the Company's Common Stock determined as follows: (a) if such Common Stock is then quoted on the Nasdaq National Market, its closing price on the Nasdaq National Market on the date of determination (grant date) as reported in The Wall Street Journal; (b) if such Common Stock is publicly traded and is then listed on a national securities exchange, its closing price on the date of determination on the principal national securities exchange on which the Common Stock is listed or admitted to trading as reported in The Wall Street Journal; -12- (c) if such Common Stock is publicly traded but is not quoted on the Nasdaq National Market nor listed or admitted to trading on a national securities exchange, the average of the closing bid and asked prices on the date of determination as reported in The Wall Street Journal; (d) in the case of an Award made on the Effective Date, the price per share at which shares of the Company's Common Stock are initially offered for sale to the public by the Company's underwriters in the initial public offering of the Company's Common Stock pursuant to a registration statement filed with the SEC under the Securities Act; or (e) if none of the foregoing is applicable, by the Committee in good faith. "Insider" means an officer or director of the Company or any other person whose transactions in the Company's Common Stock are subject to Section 16 of the Exchange Act. "Option" means an award of an option to purchase Shares pursuant to Section 5. "Parent" means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company if each of such corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. "Participant" means a person who receives an Award under this Plan. "Plan" means this Mercator Software, Inc. 1997 Equity Incentive Plan, as amended from time to time. "Restricted Stock Award" means an award of Shares pursuant to Section 6. "SEC" means the Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended. "Shares" means shares of the Company's Common Stock reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and 18, and any successor security. "Stock Bonus" means an award of Shares, or cash in lieu of Shares, pursuant to Section 7. "Subsidiary" means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. "Termination" or "Terminated" means, for purposes of this Plan with respect to a Participant, that the Participant has for any reason ceased to provide services as an employee, officer, director, consultant, independent contractor, or advisor to the Company or a Parent or Subsidiary of the Company. An employee will not be deemed to have ceased to provide services in the case of (i) sick leave, (ii) military leave, or (iii) any other leave of absence approved by the Committee, provided, that such leave is for a period of not more than 90 days, unless reemployment upon the expiration of such -13- leave is guaranteed by contract or statute or unless provided otherwise pursuant to formal policy adopted from time to time by the Company and issued and promulgated to employees in writing. In the case of any employee on an approved leave of absence, the Committee may make such provisions respecting suspension of vesting of the Award while on leave from the employ of the Company or a Subsidiary as it may deem appropriate, except that in no event may an Option be exercised after the expiration of the term set forth in the Option agreement. The Committee will have sole discretion to determine whether a Participant has ceased to provide services and the effective date on which the Participant ceased to provide services (the "Termination Date"). -14- EX-5.1 6 b47765asexv5w1.txt EX-5.1 OPINION OF SKADDEN ARPS LLP Exhibit 5.1 September 12, 2003 Ascential Software Corporation 50 Washington Street Westborough, MA 01581 Re: Ascential Software Corporation Registration Statement on Form S-8 ---------------------------------- Ladies and Gentlemen: We have acted as special counsel to Ascential Software Corporation, a Delaware corporation (the "Company"), in connection with the Registration Statement on Form S-8 (the "Registration Statement"), for the purpose of registering with the Securities and Exchange Commission (the "Commission"), under the Securities Act of 1933, as amended (the "Securities Act"), (i) 1,833,194 shares (the "Shares") of the Company's common stock, par value $.01 per share, (the "Common Stock"), issuable upon the exercise of options granted under the TSI International Software Ltd. 1993 Stock Option Plan, the 1996 Novera Software Inc. Stock Option Plan and the Mercator Software, Inc. 1997 Equity Incentive Plan (collectively, the "Plans") and assumed by the Company (each, an "Option") pursuant to the Agreement and Plan of Merger dated as of August 2, 2003 by and among the Company, Greek Acquisition Corporation and Mercator Software, Inc. (the "Merger Agreement") and (ii) the Common Stock Purchase Rights attached to the Shares (the "Rights"). This opinion is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act. In connection with this opinion, we have examined and relied upon originals or copies, certified or otherwise identified to our satisfaction, of (i) the Registration Statement in the form to be filed with the Commission on the date hereof under the Securities Act; (ii) the Merger Agreement; (iii) the Certificate of Ascential Software Corporation September 12, 2003 Page 2 Ownership and Merger, dated September 12, 2003, as filed with the Secretary of State of the State of Delaware effecting the merger contemplated by the Merger Agreement; (iv) the Restated Certificate of Incorporation and the Restated Bylaws of the Company, each as currently in effect; (v) certain resolutions of the Board of Directors of the Company; (vi) the Plans; (vii) the First Amended and Restated Rights Agreement, dated as of August 12, 1997, between Informix Corporation and BankBoston N.A., as Rights Agent (the "Rights Agreement"); (viii) Amendment No. 1 to the First Amended Restated Rights Agreement, dated as of November 17, 1997, between Informix Corporation (the Company's former name) and BankBoston N.A., as Rights Agent; (ix) Amendment No. 2 to the First Amended and Restated Rights Agreement, dated as of April 26, 2002, between the Company and EquiServe Trust Company, N.A., as successor Rights Agent; and (x) a form of rights certificate evidencing the Rights (the "Rights Certificate"). We have also examined originals or copies, certified or otherwise identified to our satisfaction, of such records of the Company and such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinion set forth herein. In our examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed or photostatic copies and the authenticity of the originals of such copies. In making our examination of documents executed by parties other than the Company, we have assumed that such parties had the power, corporate or other, to enter into and perform all obligations thereunder and have also assumed the due authorization by all requisite action, corporate or other, and execution and delivery by such parties of such documents and the validity and binding effect thereof on such parties. As to any facts material to the opinions expressed herein which we have not independently established or verified, we have relied upon statements and representations of officers and other representatives of the Company and others. We have also assumed that each option agreement setting forth the terms of each Option granted under each of the Plans is consistent with the respective Plan and was duly authorized and validly executed and delivered by the parties thereto, and that the consideration received by the Company for the Shares delivered upon the exercise of each such Option will be in an amount at least equal to the par value of the Common Stock. Members of our firm are admitted to the bar in the State of Delaware, and we do not express any opinion as to the laws of any other jurisdiction. Ascential Software Corporation September 12, 2003 Page 3 Based upon and subject to the foregoing, we are of the opinion that: 1. The Shares have been duly authorized for issuance and, when issued and paid upon the exercise of an Option duly granted under a Plan in accordance with the provisions of such Plan and the applicable option agreement, will be validly issued, fully paid and nonassessable. 2. The Rights attached to the Shares have been duly authorized for issuance and, when issued, will be validly issued. We hereby consent to the filing of this opinion with the Commission as an exhibit to the Registration Statement. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder. Very truly yours, /s/ Skadden, Arps, Slate Meagher & Flom LLP EX-23.2 7 b47765asexv23w2.txt EX-23.2 CONSENT OF KPMG LLP Exhibit 23.2 INDEPENDENT AUDITORS' CONSENT The Board of Directors Ascential Software Corporation: We consent to the incorporation by reference in the Registration Statement on Form S-8 of Ascential Software Corporation of our report dated January 29, 2003, relating to the consolidated balance sheets of Ascential Software Corporation and subsidiaries as of December 31, 2002 and 2001, and the related consolidated statements of operations, stockholders' equity and cash flows for each of the years in the three-year period ended December 31, 2002, and the related financial statement schedule, which report appears in the December 31, 2002 annual report on Form 10-K of Ascential Software Corporation. /s/ KPMG LLP Boston, Massachusetts September 12, 2003 -----END PRIVACY-ENHANCED MESSAGE-----

EX-4.5

                                                                     EXHIBIT 4.5

                         TSI INTERNATIONAL SOFTWARE LTD.
                             1993 STOCK OPTION PLAN
                         (AS ADOPTED SEPTEMBER 10, 1993)

SECTION 1. PURPOSE OF THE PLAN

         This 1993 Stock Option Plan is intended to continue the established
policy of TSI International Software Ltd. ("Company") of encouraging ownership
of its Common Stock by selected persons and of providing incentives for them to
increase the productivity of the Company. By extending to those selected persons
the opportunity to acquire proprietary interests in the Company and to
participate in its success, this Plan may be expected to benefit the Company and
its shareholders by making it possible for the Company to attract and retain the
best available talent and by rewarding those selected persons for their part in
increasing the value of the Company's stock.

SECTION 2. PRIOR PLAN

         Upon the effectiveness of the merger in which TSI International Ltd., a
Connecticut corporation ("TSI Connecticut") merges with and into the Company,
all options granted pursuant to the TSI Connecticut 1989 Stock Option Plan, as
amended, shall be assumed under this Plan, and shall be deemed granted under
this Plan for all purposes.

SECTION 3. DEFINITIONS

         As used herein, the following definitions shall apply:

         3.01 "Affiliate" shall mean any person or entity which controls, is
controlled by or is under common control with the Company, where "control" means
the ownership of more than fifty percent (50%) of the total voting power of the
outstanding stock of a corporation or of the outstanding ownership of a non-
corporate entity.

         3.02 "Board" shall mean the Board of Directors of the Company.

         3.03 "Code" shall mean the Internal Revenue Code of 1986, including any
amendments made thereto.

         3.04 "Committee" shall mean the Stock Option Committee of the Board of
Directors, if any, and shall otherwise mean the Board.

         3.05 "Common Stock" shall mean the Common Stock, $.01 par value per
share, of the Company.

         3.06 "Company" shall mean TSI International Software Ltd.

         3.07 "Continuous Employment" with the Company or any Parent, Subsidiary
or Affiliate of the Company shall mean, in the case of an employee, continuous
regular employment

by the Company or any Parent, Subsidiary or Affiliate of the Company, or an
uninterrupted chain of continuous regular employment by the Company or any
Parent, Subsidiary or Affiliate of the Company. A leave of absence granted in
accordance with the Company's usual procedure which does not operate to
interrupt Continuous Employment for other benefits granted by the Company shall
not be considered a termination of employment nor an interruption of Continuous
Employment hereunder, and an employee who is granted such a leave of absence
shall be considered to be continuously employed during the period of such leave.
In the case of an Optionee who is a director, independent consultant, contractor
or advisor, the Committee will have the discretion to determine whether the
Optionee is "continuously employed by the Company."

         3.08 "Formula Value" shall mean the sum of (I) the aggregate exercise
price of all In-the-Money Options to purchase Common Stock exercisable as of the
most recent fiscal year end plus (II) the greater of:

              (a) eighty percent (80%) of the annual sales of the Company for
the fiscal year of the Company most recently ended; or

              (b) the product of the Matrix Factor multiplied by the Company's
net profit before taxes for the twelve-month period ended on the last date of
the most recently ended fiscal year.

         3.09 "In-the-Money Options" shall mean outstanding options to purchase
Common Stock (whether granted pursuant to an employee stock option plan or
otherwise) as to which the exercise price per Share is less than the current
value of Common Stock per Share. For purposes of the identification of "In-the-
Money Options" only, the current value of Common Stock per Share shall mean the
quotient of (I) the greater of:

              (a) eighty percent (80%) of the annual sales of the Company for
the Company's most recently ended fiscal year; or

              (b) the product of the Matrix Factor multiplied by the Company's
net profit before taxes for the twelve-month period ended on the last day of the
Company's most recently ended fiscal year, divided by (II) the Outstanding
Shares as of the most recent fiscal year end.

         3.10 "Matrix Factor" shall mean a percentage represented by the factor
set out in the matrix set forth in the addendum attached hereto. For purposes of
determining "Earnings Growth" or "Sales Growth" for purposes of such matrix,
sales and net earnings of the Company for the most recently ended fiscal year
shall be compared to sales and net earnings of the Company for the second most
recently ended fiscal year.

        Net earnings, sales and net profits before taxes for each relevant
fiscal year, and annual sales of the Company for each fiscal year, shall be
determined in good faith by the Committee, on the basis of audited financial
statements of the Company prepared by the independent certified public
accountants then retained by the Company, to the extent available or expected to
be available within a reasonable time, or to the extent audited financial
statements are not and will not be so available, on unaudited financial
statements prepared according to generally accepted accounting principles
consistently applied to prior periods.

         3.11 "Option" shall mean a stock option granted pursuant to this Plan.

         3.12 "Optionee" shall mean a selected person who receives an Option.

         3.13 "Outstanding Shares" will mean the sum of the outstanding shares
of Common Stock plus all outstanding convertible preferred stock (on an as-if-
converted to Common Stock basis) plus all In-the-Money Options (on an as-if-
exercised basis).

         3.14 "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, at the time of the
granting of the Option, each of such corporations other than the Company owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.

         3.15 "Plan" shall mean this 1993 Stock Option Plan.

         3.16 "Share" shall mean a share of the Common Stock of the Company as
adjusted in accordance with Section 17 of this Plan.

         3.17 "Subsidiary" shall mean any corporation (other than the Company)
in an unbroken chain of corporations beginning with the Company if, at the time
of granting the Option, each of the corporations other than the last corporation
in the unbroken chain owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other corporations in such
chain.

SECTION 4. TYPES OF OPTIONS AND SHARES

         Options to purchase Shares granted under this Plan may be either (a)
incentive stock options ("ISO's") within the meaning of Section 422A of the Code
or (b) non-qualified stock options ("NQSO's"), as designated at the time of
grant.

SECTION 5. STOCK RESERVED FOR THE PLAN

         5.01 Number of Shares. The aggregate number of Shares, that may be
issued pursuant to Options granted under this Plan is 519,477 Shares, subject to
adjustment pursuant to the provisions of Section 16, plus any Shares that become
available through repurchases pursuant to Section 5.03, below. At all times
during the term of this Plan, the Company shall reserve out of its authorized
but unissued Shares, or its treasury shares, such number of Shares as may be
issued upon the exercise of Options granted under this Plan.

         5.02 Termination or Expiration of Options. If any Options granted under
this Plan shall for any reason terminate or expire without having been exercised
in full, the Shares not purchased under such Options shall be available for
future grant and purchase under this Plan.

         5.03 Repurchase of Stock. Any Shares previously issued pursuant to this
Plan, and any Shares that were previously shares of the Company's Class C Common
Stock, that are subsequently repurchased pursuant to the Company's right to
repurchase stock, shall be available for future grant and purchase under this
Plan; provided that no such repurchased Shares may be

made subject to ISO's granted under this Plan.

SECTION 6. ADMINISTRATION OF THE PLAN

         6.01 Committee. The Board shall appoint a Stock Option Committee of
directors (the "Committee") to administer this Plan. The Board may from time to
time appoint members of the Committee in substitution for or in addition to
members previously appointed to fill vacancies, however caused, in the
Committee. Prior to such appointment, the entire Board shall act as the
"Committee." No member of the Committee may participate in any respect
concerning the granting of an Option to such member.

         6.02 Administration by Committee. The Committee shall have plenary
authority in its discretion (subject to the express provisions of this Plan): to
determine the purchase price of the Common Stock covered by each Option, the
selected persons to whom and the time or times at which Options shall be
granted, time or times at which Options granted hereunder shall become
exercisable, and the number of Shares to be covered by each Option; to interpret
this Plan; to prescribe, amend and rescind rules and regulations relating to
this Plan; to determine the terms (which need not be identical) of option
agreements executed and delivered under this Plan, including such terms and
provisions as shall be requisite in the judgment of the Committee to conform to
any change in any law or regulation applicable thereto; to accelerate the
exercisability of any Option; to modify or amend any option agreement entered
into pursuant hereto; to execute on behalf of the Company any instrument
required to effectuate an Option grant; to ensure satisfaction of any
withholding tax obligation which may be imposed with respect to the grant or
exercise of an Option; and to make all other determinations deemed necessary or
advisable for the administration of the Plan. The Committee's determination on
the foregoing matters shall be conclusive. Upon the Committee's request, the
President of the Company shall make recommendations to the Committee as to the
granting of Options and any other determinations within the Committee's
discretion.

SECTION 7. ELIGIBILITY

         Options may be granted to employees, officers, directors, consultants,
independent contractors and advisors (provided such consultants, contractors and
advisors render bona fide services not in connection with the offer and sale of
securities of the Company in a capital-raising transaction) of the Company or
any Parent, Subsidiary or Affiliate of the Company. ISO's may be granted only to
employees (including officers and directors who are also employees) of the
Company or a Parent or Subsidiary of the Company. The Committee in its sole
discretion shall select the Optionees. An Optionee may be granted more than one
Option under this Plan. The Company may also, from time to time, assume
outstanding options granted by another company, whether in connection with an
acquisition of such other company or otherwise, by either (i) granting an option
under this Plan in replacement of the option assumed by the Company, or (ii)
treating the assumed option as if it had been granted under this Plan if the
terms of such assumed option could be applied to an option granted under this
Plan. Such assumption shall be permissible if the holder of the assumed option
would have been eligible to be granted an option hereunder if the other company
had applied the rules of this Plan to such grant.

SECTION 8. FACTORS TO BE CONSIDERED IN GRANTING OPTIONS

         In determining the selected persons to whom Options shall be granted,
the terms of the Option and the number of Shares to be covered by each Option,
the Committee shall take into account such factors as it shall deem relevant in
connection with accomplishing the purpose of this Plan.

SECTION 9. GRANT AGREEMENT; CONSIDERATION

         The Committee shall cause to be executed by any person receiving and
accepting the grant of an Option, a written option agreement in such form as the
Committee shall determine, specifying the terms and conditions of the Option
(the "Grant"). All Grants shall conform to the provisions of the Plan, but the
specific terms and conditions of each Option granted thereunder need not be the
same. The Committee shall require such consideration for the granting of the
Option as it shall deem necessary or advisable.

SECTION 10. OPTION PRICES

         The purchase price of Common Stock covered by each Option shall be
determined by the Committee, but shall not be less than 100% of the fair market
value of the Common Stock at the time the Option is granted unless the Committee
determines, with respect to NQSO's only, that a lower purchase price is
advisable. Any determination of the fair market value or of the method of
computing fair market value of a share made by the Committee shall be final,
binding and conclusive on all parties. In the absence of any provision by the
Committee to the contrary, the fair market value of the Share shall be (A) the
Formula Value of the Company divided by (B) the sum of (I) the Outstanding
Shares plus (II) the maximum aggregate number of shares of Common Stock which
could be purchased by the exercise of In-the-Money Options exercisable as of the
most recent fiscal year end.

SECTION 11. TERM OF OPTIONS

         Options shall be exercisable within the times or upon the events
determined by the Committee as set forth in the Grant; provided, however, that
no Option shall be exercisable after the expiration of ten (10) years from the
date the Option is granted, and provided further that no ISO granted to a holder
of ten percent (10%) or more of the Outstanding Shares shall be exercisable
after the expiration of five (5) years from the date the Option is granted.

SECTION 12. EXERCISE OF OPTIONS

         12.01 When exercisable, the Committee shall have the discretion to
establish the vesting schedule for any Options granted under this Plan.

         In the event of a dissolution or liquidation of the Company, a merger
in which the

Company is not the surviving corporation (except for a merger in which the
shareholders of the Company own or control a majority of the surviving
corporation's voting stock immediately following such merger), the acquisition
of all or substantially all of the Company's outstanding stock in which the
shareholders of the Company own or control less than a majority of the Company's
voting stock immediately following such acquisition, the sale of all or
substantially all of the assets of the Company, or any other transaction which
qualifies as a "corporate transaction" under Section 425(a) of the Code wherein
the shareholders of the Company give up all of their equity interest in the
Company, any or all outstanding Options shall, notwithstanding any contrary
terms of the Grant, accelerate and become exercisable in full at least twenty
(20) days prior to and shall expire on, (and, if the Company has reserved to
itself a right to repurchase shares issued upon exercise of Options at the
original purchase price of such shares, such right shall terminate upon), the
consummation of such dissolution, liquidation, merger, acquisition or sale of
assets at such times and on such conditions as the Committee shall determine.
The aggregate Fair Market Value (determined at the time an Option is granted) of
stock with respect to all ISOs held by an Optionee that first become exercisable
in the calendar year of such dissolution, liquidation, merger, sale of stock or
sale of assets may not exceed $100,000. If the Fair Market Value of stock with
respect to which all ISOs are first exercisable in such calendar year exceeds
$100,000, the Options for the first $100,000 worth of stock to become
exercisable in that year shall be ISOs and the Options for the amount in excess
of $100,000 shall be NQSOs.

         Unless otherwise provided in the option agreement, a holder of an
Option may purchase all, or from time-to-time any part of, the Shares the right
to purchase which has accrued to him or her in accordance with the terms of this
Section.

         Except as provided in Sections 15 and 16, no Option may be exercised at
any time unless the holder thereof is then employed by the Company or a Parent,
Subsidiary or Affiliate of the Company. In the case of an NQSO held by a
director, consultant, independent contractor or adviser, the Committee shall
determine, in its sole discretion, whether the Optionee is "employed by the
Company." The holder of an Option shall have none of the rights of a shareholder
with respect to the Shares subject to Option until such Shares shall have been
registered on the transfer books of the Company in the name of the person or
persons exercising the Option upon the exercise of the option.

         12.02 Payment of Purchase Price. Payment for the Shares may be made in
cash (by check) or, where approved by the Committee in its sole discretion at
the time of grant and where permitted by law: (i) the cancellation of
indebtedness of the Company to the Optionee; (ii) by waiver of compensation due
or accrued to Optionee for services rendered; (iii) by surrender of shares of
Common Stock of the Company that have been owned by the Optionee for more than
six (6) months (and which have been paid for within the meaning of SEC Rule 144)
or were obtained by the Optionee in the open public market having a Fair Market
Value equal to the exercise price of the Option; (iv) provided that a public
market for the Company's stock exists, through a "same day sale" commitment from
the Optionee and a broker-dealer that is a member of the National Association of
Securities Dealers (an "NASD Dealer") whereby the Optionee irrevocably elects to
exercise the Option and to sell a portion of the Shares so purchased to pay for
the exercise price and whereby the NASD Dealer irrevocably commits upon receipt
of such Shares to forward the exercise price directly to the Company; or (v) by
any combination of the

foregoing.

         12.03 Withholding taxes. Prior to issuance of the Shares upon exercise
of an Option, the Optionee shall pay or make adequate provision for any federal
or state withholding obligations of the Company, if applicable. Where approved
by the Committee in its sole discretion, the Optionee may provide for payment of
withholding 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.

         12.04 Notice of Election. A person electing to exercise an Option shall
give written notice to the Company, as specified by the Committee, of his or her
election to exercise an Option and of the number of Shares such person has
elected to purchase, such notice to be accompanied by the instrument evidencing
such Option and any other documents required by the Committee or the Grant, and
shall at the time of such exercise tender the purchase price of the Shares such
person has elected to purchase. If the notice of election to exercise is given
by the executor or administrator of a deceased Optionee or by the person or
persons to whom the Option has been transferred under the Optionee's will or the
applicable laws of descent and distribution, the Company will be under no
obligation to deliver Shares pursuant to such exercise unless and until the
Company is satisfied that the person or persons giving such notice is or are
entitled to exercise the Option.

         12.05 Restrictive Agreement. Any Common Stock purchased pursuant to an
Option granted under this Plan shall be held subject to such restrictions as the
Committee shall determine, in its sole discretion, are appropriate at the time
of grant of the Option

SECTION 13. ASSUMED OPTIONS

         In the event the Company assumes an option granted by another Company,
the terms and conditions of such option shall remain unchanged (except the
exercise price and the number and nature of shares issuable upon exercise, which
will be adjusted appropriately pursuant to Section 425(c) of the Code). In the
event the Company elects to grant a new option rather that assuming an existing
option (as specified in Section 7), such new option need not be granted at Fair
Market Value on the date of grant and may instead be granted with a similarly
adjusted exercise price.

SECTION 14. NON-TRANSFERABILITY OF OPTIONS

         An Option granted under this Plan shall not be transferable otherwise
than by will or the laws of descent and distribution, and an Option may be
exercised, during the lifetime of the Optionee, only by such Optionee.

SECTION 15. TERMINATION OF EMPLOYMENT

         15.01 Right to Exercise Option. If an Optionee ceases to be employed by
the Company or any Parent, Subsidiary or Affiliate of the Company for any reason
except death or disability, the Optionee may exercise such Optionee's Option to
the extent (and only to the extent) that it would have been exercisable upon the
date of termination, within three (3) months after the date of termination (or
such shorter time period as may be specified in the Grant), provided that, if

Optionee is an Insider and the Company is subject to Section 16(b) of the
Exchange Act, the Optionee's Option will be exercisable for a period of time
sufficient to allow such Optionee from having a matching purchase and sale under
Section 16(b), with any extension beyond three (3) months from termination of
employment deemed to be an NQSO, and provided further that in no event may an
Option be exercisable later than the expiration date of the Option.

         15.02 Employment Relationship. Options granted under this Plan shall
not be affected by change of duties or position so long as the Optionee
continues to be employed by or to have a similar relationship with the Company
or any Parent, Subsidiary or Affiliate of the Company; provided that the holder
of an ISO must remain an employee of the Company or a Parent or Subsidiary in
order for such Optionee's employment not to be deemed to have terminated as
regards such ISO. Retirement pursuant to any pension plan provided by the
Company shall be deemed to be a termination of employment for the purposes of
this Section. Nothing in this Plan or in any Option granted pursuant to this
Plan shall confer upon any person employed by the Company or any Parent,
Subsidiary or Affiliate of the Company, any right to continue in the employ of
the Company or any Parent, Subsidiary or Affiliate of the Company or interfere
with the right of the Company to terminate such Optionee's employment or other
relationship at any time.

SECTION 16. DEATH OF OPTIONEE

         If an Optionee's employment or other relationship with the Company or
any Parent, Subsidiary or Affiliate of the Company is terminated because of the
death of the Optionee or disability of Optionee within the meaning of Section
22(e)(3) of the Code, such Optionee's Options may be exercised to the extent
(and only to the extent) that it would have been exercisable by the Optionee on
the date of termination, by the Optionee (or the Optionee's legal
representative) within twelve (12) months after the date of termination (or such
shorter time period as may be specified in the Grant), but in any event no later
than the expiration date of the Options.

SECTION 17. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

         In the event that the number of outstanding shares of Common Stock of
the Company is changed by the stock dividend, stock split, reverse stock split,
combination, re-classification or similar change in the capital structure of the
Company without consideration, or if a substantial portion of the assets of the
Company are distributed, without consideration in a spin-off or similar
transaction, to the shareholders of the Company, the number of Shares available
under this Plan and the number of Shares subject to outstanding Options and the
exercise price per share of such Option shall be proportionately adjusted,
subject to any required action by the Board or shareholders of the Company and
compliance with applicable securities laws; provided, however, that a fractional
share shall not be issued upon exercise of any Option and any fractions of a
Share that would have resulted shall either be cashed out at Fair Market Value
or the number of shares issuable under the Option shall be rounded up to the
nearest whole number, as determined by the Committee; and provided further that
the exercise price may not be decreased to below the par value, if any, for the
Shares.

SECTION 18. TIME OF GRANTING OPTIONS

         Nothing contained in this Plan or in any resolution to be adopted by
the Board or the holders of securities of the Company shall constitute the
granting of any Option hereunder. An Option granted pursuant to this Plan shall
be deemed to have been granted on the date on which the name of the recipient
and price of the Shares and the other terms of the Option are determined by the
Committee.

SECTION 19. TERMINATION AND AMENDMENT OF THE PLAN

         Unless this Plan shall theretofore have been terminated as hereinafter
in this Section provided, no Option shall be granted hereunder after ten (10)
years from the date of the adoption hereof. The Board may at any time prior to
that date terminate this Plan or make such modification or amendment of this
Plan as it shall deem advisable; provided, however, that no amendment may be
made, without the approval by the holders of the Company's shareholders, except
as provided in Section 16 hereof, which would (i) increase the maximum number of
Shares for which Options may be granted under this Plan, (ii) extend the period
during which an Option may be granted, or (iii) amend the requirements as to the
class of selected persons eligible to receive Options. No termination,
modification, or amendment of this Plan or any Grant may, without consent of the
Optionee to whom an Option shall theretofore have been granted, adversely affect
the rights of such Optionee under such Option.

SECTION 20. CONDITIONS UPON ISSUANCE OF SHARES

         Shares of Common Stock shall not be issued with respect to an Option
unless the exercise of such Option and the issuance and delivery of such Shares
pursuant thereto shall comply with all relevant provisions of law, including,
without limitation, the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, the rules and regulations promulgated
thereunder, the requirements of any stock exchange upon which the Common Stock
may then be listed, the applicable state securities laws, and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.

         As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Common Stock is being purchased only for investment and
without any present intention to sell or distribute such Common Stock if, in the
opinion of counsel for the Company, such a representation is necessary or
desirable under any of the aforementioned relevant provisions of law.

SECTION 21. GOVERNMENT REGULATIONS

         The Plan and the granting and exercise of Options hereunder, and the
obligation of the Company to sell and deliver Shares under such Options, shall
be subject to all applicable laws, rules and regulations.

SECTION 22. EFFECTIVE DATE; SHAREHOLDER'S APPROVAL

         The Plan shall be effective upon shareholder approval within twelve
(12) months of its adoption by the Board by a majority of those shareholders of
the Company who are present at a duly constituted shareholders' meeting.

SECTION 23. GOVERNING LAW

         This Plan shall be governed by and construed in accordance with the
laws of the State of Connecticut.

                                    ADDENDUM

                                  Matrix Factor



Sales Growth (%)                         Earnings Growth (%)
- -------------------------------------------------------------------------------
                        Less than 10%       10-15%   15-20%    Greater than 20%
- -------------------------------------------------------------------------------
                                                   
Less than 10%                 4               5        6             7
10-15%                        5               6        7             8
15-20%                        6               7        8             9
Greater than 20%              7               8        9            10


                    [FORM OF TSI INTERNATIONAL SOFTWARE LTD.
                               STOCK OPTION GRANT]



Optionee:  ____________________________________

Address:   ____________________________________


Total Shares Subject to Option:  ____________________________________
Exercise Price Per Share:        ____________________________________
Date of Vesting Commencement:    ____________________________________
Date of Grant:                   ____________________________________
Expiration Date:                 ____________________________________
Type of Stock Option:            ____________ Incentive
                                 ____________ Nonqualified

         1. Grant of Option. TSI International Software Ltd., a Connecticut
corporation (the "Company"), hereby grants, on the date of grant set forth above
(the "Date of Grant"), to the optionee named above ("Optionee") an option (this
"Option") to purchase the total number of shares of Common Stock of the Company
set forth above (the "Shares") at the exercise price per share set forth above
(the "Exercise Price"), subject to all of the terms and conditions of this Grant
and the Company's 1993 Stock Option Plan, as amended to the date hereof (the
"Plan"). If designated as an Incentive Stock Option above, this Option is
intended to qualify as an "incentive stock option" ("ISO") within the meaning of
Section 422A of the Internal Revenue Code of 1986, as amended (the "Code").
Unless otherwise defined herein, capitalized terms used herein shall have the
meanings ascribed to them in the Plan.

         2. Exercise Period of Option. Subject to the terms and conditions of
the Plan and this Grant, this Option shall become exercisable as to one- quarter
of the Shares on and after the date of vesting commencement set forth above (the
"Vesting Commencement Date"), and shall become exercisable as to an additional
one-quarter of the Shares on each anniversary of the Vesting Commencement Date
thereafter; provided that this Option shall expire on the Expiration Date set
forth above and must be exercised, if at all, on or before the Expiration Date.

         3. Restriction on Exercise. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933 and all
applicable state 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 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 Commission, any state securities
commission or any stock exchange to effect such compliance.

         4. Termination of Option. Except as provided below in this Section,
this Option shall terminate and may not be exercised if Optionee ceases to be
employed by the Company or

any Parent or Subsidiary of the Company (or, in the case of a nonqualified stock
option, an Affiliate of the Company). Optionee shall be considered to be
employed by the Company for all purposes under this Section 4 if Optionee is an
officer, director or full-time employee of the Company or any Parent, Subsidiary
or Affiliate of the Company or if the Board of Directors determines that
Optionee is rendering substantial services as a part- time employee, consultant,
contractor or adviser to the Company or any Parent, Subsidiary or Affiliate of
the Company. The Board of Directors of the Company shall have discretion to
determine whether Optionee has ceased to be employed by the Company or any
Parent, Subsidiary or Affiliate of the Company and the effective date on which
such employment terminated (the "Termination Date").

         (a)      Termination Generally. If Optionee ceases to be employed by
                  the Company or any Parent, Subsidiary or Affiliate of the
                  Company for any reason except death or disability, this
                  Option, to the extent (and only to the extent) that it would
                  have been exercisable by Optionee on the Termination Date, may
                  be exercise by Optionee within three (3) months after the
                  Termination Date, but in no event later than the Expiration
                  Date.

         (b)      Death or Disability. If Optionee's employment with the Company
                  or any Parent, Subsidiary or Affiliate of the Company is
                  terminated because of the death of Optionee or the disability
                  of Optionee within the meaning of Section 22(e)(3) of the
                  Code, 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 Optionee's legal
                  representative) within twelve (12) months after the
                  Termination Date, but in no event later than the Expiration
                  Date.

         (c)      No Right to Employment. Nothing in the Plan or this Grant
                  shall confer on Optionee any right to continue in the employ
                  of, or other relationship with, the Company or any Parent,
                  Subsidiary or Affiliate of the Company or limit in any way the
                  right of the Company or any Parent, Subsidiary or Affiliate of
                  the Company to terminate Optionee's employment or other
                  relationship at any time, with or without cause.

5.       Manner of Exercise.

         (a)      Exercise Agreement. This Option shall be exercisable by
                  delivery to the Company of any executed written Stock Option
                  Agreement in the form attached hereto as Exhibit A, or in such
                  other form as may be approved by the Company, which shall set
                  forth Optionee's election to exercise some or all of 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.

         (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 check) or,
                  where permitted by law, such other forms of consideration as
                  are set forth in the Plan.

         (c)      Withholding Taxes. Prior to the issuance of the Shares upon
                  exercise of this Option, Optionee must pay or make adequate
                  provision for any applicable federal or state withholding
                  obligations of the Company.

         (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.       Notice of Disqualifying Disposition of ISO Shares. If the Option
         granted to Optionee herein is an ISO, and if Optionee sells or
         otherwise disposes of any of the Shares acquired pursuant to the ISO on
         or before the later if (1) the date two years after the Date of Grant,
         or (2) the date one year after exercise of the ISO with respect to the
         Shares to be sold or disposed, the Optionee shall immediately notify
         the Company in writing of such disposition. Optionee acknowledges and
         agrees that Optionee may be subject to income tax withholding by the
         Company in the compensation income recognized by the Optionee from any
         such early disposition by paymnet in cash or out of the current wages
         or other earnings payable to the Optionee.

7.       Nontransferability of Option. This Option may not be transferred in any
         manner other than by will or by the law of descent and distribution and
         may be exercised during the lifetime of the Optionee only by the
         Optionee. The terms of this Option shall be binding upon the executors,
         administrators and successors of the Optionee.

8.       Interpretation. Any dispute regarding the interpretation of this Stock
         Option Grant shall be submitted by Optionee or the Company to the
         Company's Board of Directors or the committee thereof that administers
         the Plan, which shall review such dispute at its next regular meeting.
         The resolution of such a dispute by the Board or committee shall be
         final and binding on the Company and on Optionee.

9.       Entire Agreement. The Plan and the Stock Option Exercise Agreement
         attached as Exhibit A are incorporated herein by this reference. This
         Grant, the Plan and the Stock Option Exercise Agreement constitute the
         entire agreement of the parties hereto and supersede all prior
         undertakings and agreements with respect to the subject matter hereof.

TSI INTERNATIONAL SOFTWARE LTD.

By:     ___________________________________
Name:   ___________________________________
Title:  ___________________________________

                                   ACCEPTANCE

         Optionee hereby acknowledges receipt of a copy of the Plan, represents
that Optionee has read and understands the terms and provisions thereof, and
accepts this Option subject to all terms and conditions of the Plan and this
Stock Option Grant. Optionee acknowledges that there may be adverse tax
consequences upon exercise of this Option or disposition of the Shares and that
Optionee should consult a tax adviser prior to such exercise or disposition.

                          _____________________________
                                    Optionee

                                    Exhibit A

                                     [FORM OF STOCK OPTION EXERCISE AGREEMENT]

         This Agreement is made this ____ day of ________________, 19___ between
TSI International Software Ltd. (the "Company"), and the optionee named below
("Optionee").

                
Optionee:
                   _______________________________________________ Social Security Number:
                   _______________________________________________ Address:
                   _______________________________________________
                   _______________________________________________ Number of Shares Purchased:
                   _______________________________________________ Price per Share:
                   _______________________________________________ Aggregate Purchase Price:
                   _______________________________________________ Date of Option Grant:
                   _______________________________________________ Date of Vesting Commencement:
                   _______________________________________________



Type of Option    [ ] Incentive Stock Option
                  [ ] Nonqualified Stock Option

Optionee hereby delivers to the Company the Aggregate Purchase Price, to the
extent permitted in the Option Grant, as follows (check as applicable and
complete):

     [ ]  in cash in the amount of $__________, receipt of which is acknowledged
          by the Company;

     [ ]  by delivery of ____________ fully-paid, nonassessable and vested
          shares of the Common Stock of the Company owned by Optionee for at
          least six (6) months prior to the date hereof and owned free and
          clear of all liens, claims, encumbrances or security interests,
          valued at the current fair market value of $_________ per share (as
          determined by the Board of Directors of the Company in good faith);

     [ ]  by the waiver hereby of compensation due or accrued for services
          rendered in the amount of $___________; or

     [ ]  if the Company is public, through a "same-day-sale" commitment,
          delivered herewith, from Optionee and the NASD broker named therein in
          the amount of $____________.

    The Company and Optionee hereby agree as follows:

1.       Purchase of Shares. On this date and subject to the terms and
         conditions of this Agreement, Optionee hereby exercises the Stock
         Option Grant between the Company and Optionee dated as of the Date of
         Option Grant set forth above (the "Grant"), with respect to the Number
         of Shares Purchased set forth above of the Company's Common Stock (the
         "Shares") at an aggregate purchase price equal to the Aggregate
         Purchase Price set forth above (the "Purchase Price") and the Price per
         Share set forth above (the "Purchase Price Per Share"). The term
         "Shares" refers to the Shares purchased under this Agreement includes
         all securities received (a) in replacement of the Shares, and (b) as a
         result of stock dividends or stock splits in respect of the Shares.
         Capitalized terms used herein that are not defined herein have the
         definitions ascribed to them in the Plan or the Grant.

2.       Stockholders' Agreement. By executing this Agreement, Optionee is also
         agreeing to become a party to and be bound by that certain
         Stockholders' Agreement dated as of June 1, 1989, as amended to the
         date hereof and as it may be further amended pursuant to its terms (the
         "Stockholders' Agreement"). A copy of the Stockholders' Agreement as
         executed on June 1, 1989 is attached hereto as Attachment 1. A copy of
         all amendments thereto may be obtained without charge from the Company
         at its principal offices.

3.       Representations of Purchaser. Optionee represents and warrants to the
         Company that:

         (a)      Optionee acknowledges that Optionee has received, read and
                  understood the Plan and the Grant and agrees to abide by and
                  be bound by their terms and conditions.

         (b)      Optionee is purchasing the Shares for Optionee's own account
                  for investment purposes only and not with a view to, or for
                  sale in connection with, a distribution of the Shares within
                  the meaning of the Securities Act of 1933, as amended (the
                  "1933 Act").

         (c)      Optionee has no present intention of selling or otherwise
                  disposing of all or any portion of the Shares.

         (d)      Optionee is fully aware of (i) the highly speculative nature
                  of the investment in the Shares; (ii) the financial hazards
                  involved; and (iii) the lack of liquidity of the Shares and
                  the restrictions on transferability of the Shares (e.g., that
                  Optionee may not be able to sell or dispose of the Shares or
                  use them as collateral for loans).

         (e)      Optionee is capable of evaluating the merits and risks of this
                  investment, has the ability to protect Optionee's own
                  interests in this transaction and is financially capable of
                  bearing a total loss of this investment.

4.       Compliance with Securities Laws. Optionee under- stands and
         acknowledges that the Shares have not been regis- tered under the 1933
         Act and that, notwithstanding any other provision of the Grant to the
         contrary, the exercise of any rights to purchase any Shares is
         expressly conditioned upon compliance with the 1933 Act and all
         applicable state securities laws. Optionee agrees to cooperate with the
         Company to ensure compliance

         with such laws. The Shares are being issued under the 1933 Act pursuant
         to (the Company will check the applicable box):

         [ ]the exemption provided by Rule 701;
         [ ] the exemption provided by Rule 504;
         [ ] Section 4(2) of the 1933 Act;
         [ ] other:_______________________.

5.       Federal Restrictions on Transfer. Optionee understands that the Shares
         must be held indefinitely unless they are registered under the l933 Act
         or unless an exemption from such registration is available and that the
         certificate(s) representing the Shares will bear a legend to that
         effect. Optionee understands that the Company is under no obligation to
         register the Shares and that an exemption may not be available or may
         not permit Optionee to transfer Shares in the amounts or at the times
         proposed by Optionee.

         (a)      Rule 144. Optionee has been advised that Rule 144 promulgated
                  under the 1933 Act, which permits certain resales of
                  unregistered securities, is not presently available with
                  respect to the Shares and, in any event, requires that the
                  Shares be paid for and then held for a minimum of two years
                  before they may be resold under Rule 144. Prior to an initial
                  public offering of the Company's stock, "nonaffiliates" (i.e.
                  persons other than officers, directors and major shareholders
                  of the Company) may resell only under Rule 144(k), which
                  requires that the Shares be paid for and held for a minimum of
                  three years. Rule 144(k) is not available to affiliates.

         (b)      Rule 701. If the exemption relied upon for exercise of the
                  Shares is Rule 701, the Shares will become freely
                  transferable, subject to limited conditions regarding the
                  method of sale, by nonaffiliates 90 days after the first sale
                  of common stock of the Company to the general public pursuant
                  to a registration statement filed with and declared effective
                  by the SEC, subject to any lengthier market standoff agreement
                  contained in this Agreement or entered into by the Optionee.
                  Affiliates must comply with the provisions (other than the
                  holding period requirements) of Rule 144.

6.       State Law Restrictions on Transfer. Optionee understands that transfer
         of the Shares may be restricted by applicable state laws and that the
         certificate(s) representing the Shares may bear a legend to that
         effect.

7.       Company's Repurchase Option.

         (a)      Termination Date. Optionee shall be considered to be employed
                  by the Company for all purposes under this Section 7 if
                  Optionee is an officer, director or full-time employee of the
                  Company or any Parent, Subsidiary or Affiliate of the Company
                  or if the Board of Directors determines that Optionee is
                  rendering substantial services as a part-time employee,
                  consultant, contractor or adviser to the Company or any
                  Parent, Subsidiary or Affiliate of the Company. The Board of
                  Directors of the Company shall have discretion to determine
                  whether Optionee

                  has ceased to be employed by the Company or any Parent,
                  Subsidiary or Affiliate of the Company and the effective date
                  on which such employment terminated (the "Termination Date").

         (b)      Repurchase Option. In the event of Optionee's Termination Date
                  occurring, for any reason whatsoever, including, without
                  limitation, resignation, termination, disability or death (a
                  "Termination of Employment"), Optionee (or Optionee's personal
                  representative) shall immediately offer the Shares to the
                  Company and the Company shall have a first right and option,
                  exercisable within thirty (30) days of such offer, to
                  repurchase the Shares.

         (c)      Repurchase Price. The purchase price of each Share in such a
                  case shall be the "Formula Value per Share." For purposes of
                  this Section 7(c), the Formula Value per Share shall mean the
                  quotient obtained by dividing the "Formula Value" (as defined
                  in the Plan) by the "Outstanding Shares" (as defined in the
                  Plan.

         (d)      Payment of Repurchase Price. The purchase price in the case of
                  any purchase of Shares by the Company pursuant to this Section
                  7 shall be paid in cash within thirty (30) days of acceptance
                  of the offer described above or within thirty (30) days of
                  such time as audited or unaudited financial statements setting
                  out the information necessary to calculate the purchase price
                  are available, whichever is later, at which time the
                  undersigned shall deliver to the Company the stock certificate
                  or certificates to be duly endorsed for transfer, with the
                  necessary documentary and transfer stamps, if any, paid for
                  and affixed by the undersigned.

8.       Right of Termination Unaffected. Nothing in this Agreement shall be
         construed to limit or otherwise affect in any manner whatsoever the
         right or power of the Company to terminate Optionee's employment at any
         time, for any reason or no reason, with or without cause.

9.       Legends. Optionee understands and agrees that the Shares are subject to
         a of repurchase held by the Company (or its assignee) as set forth
         herein, and certain other rights as are set forth in the Stockholders'
         Agreement, and that, in addition to the legends described in the
         Stockholders' Agreement, the certificate(s) representing the Shares
         will bear legends in substantially the following forms:

"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS
ON PUBLIC RESALE AND TRANSFER AND RIGHT OF FIRST REFUSAL AND REPURCHASE OPTIONS
HELD BY THE ISSUER AND/OR ITS ASSIGNEE(S) AND MAY NOT BE TRANSFERRED EXCEPT AS
SET FORTH IN AN AGREEMENT 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 AND REPURCHASE ARE BINDING
ON TRANSFEREES OF THESE SHARES."

"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND MAY NOT BE

OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE SECURITIES ACT OR, IN THE OPINION OF COUNSEL IN FORM AND
SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURI TIES, SUCH OFFER, SALE OR
TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH."

10.      Stop-Transfer Notices. Optionee understands and agrees that, in order
         to ensure compliance with the restric- tions 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.

11.      Tax Consequences. 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 CONSULTANT(s) 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. IN PARTICULAR, IF OPTIONEE IS AN
         INSIDER SUBJECT TO SECTION 16(b) OF THE SECURITIES EXCHANGE ACT OF
         1934, OPTIONEE REPRESENTS THAT OPTIONEE HAS CONSULTED WITH OPTIONEE'S
         TAX ADVISERS CONCERNING THE ADVISABILITY OF FILING AN 83(b) ELECTION
         WITH THE INTERNAL REVENUE SERVICE.

12.      Entire Agreement. The Plan, Grant and Stockholders' Agreement are
         incorporated herein by reference. This Agreement, the Plan and the
         Grant constitute the entire agreement of the parties and supersede in
         their entirety all prior undertakings and agreements of the Company and
         Optionee with respect to the subject matter hereof, and is governed by
         Connecticut law except for that body of law pertaining to conflict of
         laws.

                                      
Submitted by:                            Accepted by:


OPTIONEE:                                TSI INTERNATIONAL SOFTWARE LTD.

(print name)

___________________                      By:_________________________________
         (signature)
                                         Its:

Dated:                                   Dated:

EX-4.6

                                                                     EXHIBIT 4.6

                              NOVERA SOFTWARE, INC.

                             1996 STOCK OPTION PLAN

1.    Purpose.


      The purpose of this plan (the "Plan") is to secure for Novera Software,
Inc. (the "Company") and its shareholders the benefits arising from capital
stock ownership by employees, officers and directors of, and consultants or
advisors to, the Company and its parent and subsidiary corporations who are
expected to contribute to the Company's future growth and success. Except where
the context otherwise requires, the term "Company" shall include the parent and
all present and future subsidiaries of the Company as defined in Sections 424(e)
and 424(f) of the Internal Revenue Code of 1986, as amended or replaced from
time to time (the "Code"). Those provisions of the Plan which make express
reference to Section 422 shall apply only to Incentive Stock Options (as that
term is defined in the Plan).

2.    Type of Options and Administration.


      (a) Types of Options. Options granted pursuant to the Plan may be either
incentive stock options ("Incentive Stock Options") meeting the requirements of
Section 422 of the Code or Non-Statutory Options which are not intended to meet
the requirements of Section 422 of the Code ("Non-Statutory Options").

      (b)   Administration.

            (i)   The Plan will be administered by the Board of Directors of the
                  Company, whose construction and interpretation of the terms
                  and provisions of the Plan shall be final and conclusive. The
                  Board of Directors may in its sole discretion grant options to
                  purchase shares of the Company's Common Stock ("Common Stock")
                  and issue shares upon exercise of such options as provided in
                  the Plan. The Board shall have authority, subject to the
                  express provisions of the Plan, to construe the respective
                  option agreements and the Plan, to prescribe, amend and
                  rescind rules and regulations relating to the Plan, to
                  determine the terms and provisions of the respective option
                  agreements, which need not be identical, and to make all other
                  determinations which are, in the judgment of the Board of
                  Directors, necessary or desirable for the administration of
                  the Plan. The Board of Directors may correct any defect,
                  supply any omission or reconcile any inconsistency in the Plan
                  or in any option agreement in the manner and to the extent it
                  shall deem expedient to carry the Plan into effect and it
                  shall be the sole and final judge of such expediency. No
                  director or person acting pursuant to authority delegated by
                  the Board of Directors shall be liable for any action or
                  determination under the Plan made in good faith.

            (ii)  The Board of Directors may, to the full extent permitted by or
                  consistent with applicable laws or regulations and Section
                  3(b) of this Plan delegate any or all of its powers under the
                  Plan to a committee (the "Committee") appointed by the Board
                  of Directors, and if the Committee is so appointed all
                  references to the Board of Directors in the Plan shall mean
                  and relate to such Committee.

      (c) Applicability of Rule 16b-3. Those provisions of the Plan which make
express reference to Rule 16b-3 promulgated under the Securities Exchange Act of
1934 (the "Exchange Act"), or any successor rule ("Rule 16b-3"), or which are
required in order for certain option transactions to qualify for exemption

under Rule 16b-3, shall apply only to such persons as are required to file
reports under Section 16(a) of the Exchange Act (a "Reporting Person").

3.    Eligibility.


      (a) General. Options may be granted to persons who are, at the time of
grant, employees, officers or directors of, or consultants or advisors to, the
Company; provided, that the class of employees to whom Incentive Stock Options
may be granted shall be limited to all employees of the Company. A person who
has been granted an option may, if he or she is otherwise eligible, be granted
additional options if the Board of Directors shall so determine. Subject to
adjustment as provided in Section 15 below, the maximum number of shares with
respect to which options may be granted to any employee under the Plan shall not
exceed 600,000 shares of common stock during the ten-year term of the Plan. For
the purpose of calculating such maximum number, (a) an option shall continue to
be treated as outstanding notwithstanding its repricing, cancellation or
expiration and (b) the repricing of an outstanding option or the issuance of a
new option in substitution for a cancelled option shall be deemed to constitute
the grant of a new additional option separate from the original grant of the
option that is repriced or cancelled.

      (b) Grant of Options to Directors and Officers. From and after the
registration of the Common Stock of the Company under the Exchange Act, the
selection of a director or an officer (as the terms "director" and "officer" are
defined for purposes of Rule 16b-3) as a recipient of an option, the timing of
the option grant, the exercise price of the option and the number of shares
subject to the option shall be determined either (i) by the Board of Directors,
of which all members shall be "disinterested persons" (as hereinafter defined),
or (ii) by two or more directors having full authority to act in the matter,
each of whom shall be a "disinterested person." For the purposes of the Plan, a
director shall be deemed to be a "disinterested person" only if such person
qualifies as a "disinterested person" within the meaning of Rule 16b-3, as such
term is interpreted from time to time.

4.    Stock Subject to Plan.


      Subject to adjustment as provided in Section 15 below, the maximum number
of shares of Common Stock which may be issued and sold under the Plan is one
million twelve thousand (1,012,000) shares. If an option granted under the Plan
shall expire or terminate for any reason without having been exercised in full,
the unpurchased shares subject to such option shall again be available for
subsequent option grants under the Plan. If shares issued upon exercise of an
option under the Plan are tendered to the Company in payment of the exercise
price of an option granted under the Plan, such tendered shares shall again be
available for subsequent option grants under the Plan; provided, that in no
event shall such shares be made available for issuance to Reporting Persons or
pursuant to exercise of Incentive Stock Options.

5.    Forms of Option Agreements.


      As a condition to the grant of an option under the Plan, each recipient of
an option shall execute an option agreement in such form not inconsistent with
the Plan as may be approved by the Board of Directors. Such option agreements
may differ among recipients.

6.    Purchase Price.


      (a) General. Subject to Section 3(b), the purchase price per share of
stock deliverable upon the exercise of an option shall be determined by the
Board of Directors, provided, however, that in the case of an Incentive Stock
Option, the exercise price shall not be less than 100% of the fair market value
of such stock, as determined by the Board of Directors, at the time of grant of
such option, or less than 110% of such fair market value in the case of options
described in Section 11(b).

      (b) Payment of Purchase Price. Options granted under the Plan may provide
for the payment of the exercise price by delivery of cash or a check to the
order of the Company in an amount equal to the exercise price of such options,
or, to the extent provided in the applicable option agreement, (i) by delivery
to the Company of shares of Common Stock of the Company already owned by the
optionee having a fair market value equal in amount to the exercise price of the
options being exercised, or (ii) by any other means (including, without
limitation, by delivery of a promissory note of the optionee payable on such
terms as are specified by the Board of Directors) which the Board of Directors
determines are consistent with the purpose of the Plan and with applicable laws
and regulations (including, without limitation, the provisions of Regulation T
promulgated by the Federal Reserve Board). The fair market value of any shares
of the Company's Common Stock or other non-cash consideration which may be
delivered upon exercise of an option shall be determined by the Board of
Directors.

7.    Option Period.


      Each option and all rights thereunder shall expire on such date as shall
be set forth in the applicable option agreement, except that, in the case of an
Incentive Stock Option, such date shall not be later than ten years after the
date on which the option is granted and, in all cases, options shall be subject
to earlier termination as provided in the Plan.

8.    Exercise of Options.


      Each option granted under the Plan shall be exercisable either in full or
in installments at such time or times and during such period as shall be set
forth in the agreement evidencing such option, subject to the provisions of the
Plan.

9.    Nontransferability of Options.


      Options shall not be assignable or transferable by the person to whom they
are granted, either voluntarily or by operation of law, except by will or the
laws of descent and distribution, and, during the life of the optionee, shall be
exercisable only by the optionee; provided, however, that Non-Statutory Options
may be transferred pursuant to a qualified domestic relations order (as defined
in Rule 16b-3).

10.   Effect of Termination of Employment or Other Relationship.


      Except as provided in Section 11(d) with respect to Incentive Stock
Options, and subject to the provisions of the Plan, the Board of Directors shall
determine the period of time during which an optionee may exercise an option
following (i) the termination of the optionee's employment or other relationship
with the Company, or (ii) the death or disability of the optionee. Such periods
shall be set forth in the agreement evidencing such option.

11.   Incentive Stock Options.


      Options granted under the Plan which are intended to be Incentive Stock
Options shall be subject to the following additional terms and conditions:

      (a) Express Designation. All Incentive Stock Options granted under the
Plan shall, at the time of grant, be specifically designated as such in the
option agreement covering such Incentive Stock Options.


      (b) 10% Shareholder. If any employee to whom an Incentive Stock Option is
to be granted under the Plan is, at the time of the grant of such option, the
owner of stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company (after taking into account the

attribution of stock ownership rules of Section 424(d) of the Code), then the
following special provisions shall be applicable to the Incentive Stock Option
granted to such individual:

            (i)   The purchase price per share of the Common Stock subject to
                  such Incentive Stock Option shall not be less than 110% of the
                  fair market value of one share of Common Stock at the time of
                  grant; and

            (ii)  The option exercise period shall not exceed five years from
                  the date of grant.

      (c) Dollar Limitation. For so long as the Code shall so provide, options
granted to any employee under the Plan (and any other incentive stock option
plans of the Company) which are intended to constitute Incentive Stock Options
shall not constitute Incentive Stock Options to the extent that such options, in
the aggregate, become exercisable for the first time in any one calendar year
for shares of Common Stock with an aggregate fair market value (determined as of
the respective date or dates of grant) of more than $100,000.

      (d) Termination of Employment, Death or Disability. No Incentive Stock
Option may be exercised unless, at the time of such exercise, the optionee is,
and has been continuously since the date of grant of his or her option, employed
by the Company, except that:

            (i) an Incentive Stock Option may be exercised within the period of
three months after the date the optionee ceases to be an employee of the Company
(or within such lesser period as may be specified in the applicable option
agreement), provided, that the agreement with respect to such option may
designate a longer exercise period and that the exercise after such three- month
period shall be treated as the exercise of a non-statutory option under the
Plan;

            (ii) if the optionee dies while in the employ of the Company, or
within three months after the optionee ceases to be such an employee, the
Incentive Stock Option may be exercised by the person to whom it is transferred
by will or the laws of descent and distribution within the period of one year
after the date of death (or within such lesser period as may be specified in the
applicable option agreement); and

            (iii) if the optionee becomes disabled (within the meaning of
Section 22(e)(3) of the Code or any successor provision thereto) while in the
employ of the Company, the Incentive Stock Option may be exercised within the
period of one year after the date the optionee ceases to be such an employee
because of such disability (or within such lesser period as may be specified in
the applicable option agreement).

For all purposes of the Plan and any option granted hereunder, "employment"
shall be defined in accordance with the provisions of Section 1.421-7(h) of the
Income Tax Regulations (or any successor regulations). Notwithstanding the
foregoing provisions, no Incentive Stock Option may be exercised after its
expiration date.

            12.   Additional Provisions.


      (a) Additional Option Provisions. The Board of Directors may, in its sole
discretion, include additional provisions in option agreements covering options
granted under the Plan, including without limitation restrictions on transfer,
repurchase rights, commitments to pay cash bonuses, to make, arrange for or
guaranty loans or to transfer other property to optionees upon exercise of
options, or such other provisions as shall be determined by the Board of
Directors; provided that such additional provisions shall not be inconsistent
with any other term or condition of the Plan and such additional provisions
shall not cause any Incentive Stock Option granted under the Plan to fail to
qualify as an Incentive Stock Option within the meaning of Section 422 of the
Code.

      (b) Acceleration, Extension, Etc. The Board of Directors may, in its sole
discretion, (i) accelerate the date or dates on which all or any particular
option or options granted under the Plan may be exercised, or (ii) extend the
dates during which all, or any particular, option or options granted under the
Plan may be exercised.

13.   General Restrictions.


      (a) Investment Representations. The Company may require any person to whom
an option is granted, as a condition of exercising such option, to enter into an
agreement providing rights of first refusal with respect to the transfer of the
Common Stock to be acquired, to give written assurances in substance and form
satisfactory to the Company to the effect that such person is acquiring the
Common Stock subject to the option for his or her own account for investment and
not with any present intention of selling or otherwise distributing the same,
and to such other effects as the Company deems necessary or appropriate in order
to comply with state securities laws, or with covenants or representations made
by the Company in connection with any public offering of its Common Stock.

      (b) Compliance With Securities Laws. Each option shall be subject to the
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject to such option
upon any securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
thereunder, such option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions acceptable to
the Board of Directors. Nothing herein shall be deemed to require the Company to
apply for or to obtain such listing, registration or qualification, or to
satisfy such condition.

14.   Rights as a Shareholder.


      The holder of an option shall have no rights as a shareholder with respect
to any shares covered by the option (including, without limitation, any rights
to receive dividends or non-cash distributions with respect to such shares)
until the date of issue of a stock certificate to him or her for such shares. No
adjustment shall be made for dividends or other rights for which the record date
is prior to the date such stock certificate is issued.

15.   Adjustment Provisions for Recapitalizations and Related Transactions.


      (a) General. If, through or as a result of any merger, consolidation, sale
of all or substantially all of the assets of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split or other similar transaction, (i) the outstanding shares of Common Stock
are increased, decreased or exchanged for a different number or kind of shares
or other securities of the Company, or (ii) additional shares or new or
different shares or other securities of the Company or other non-cash assets are
distributed with respect to such shares of Common Stock or other securities, an
appropriate and proportionate adjustment may be made in (x) the maximum number
and kind of shares reserved for issuance under the Plan, (y) the number and kind
of shares or other securities subject to any then outstanding options under the
Plan, and (z) the price for each share subject to any then outstanding options
under the Plan, without changing the aggregate purchase price as to which such
options remain exercisable. Notwithstanding the foregoing, no adjustment shall
be made pursuant to this Section 15 if such adjustment would cause the Plan to
fail to comply with Section 422 of the Code.

      (b) Board Authority to Make Adjustments. Any adjustments under this
Section 15 will be made by the Board of Directors, whose determination as to
what adjustments, if any, will be made and the extent

thereof will be final, binding and conclusive. No fractional shares will be
issued under the Plan on account of any such adjustments.

16.   Merger, Consolidation, Asset Sale, Liquidation, etc.

      (a) General. In the event of a consolidation or merger or sale of all or
substantially all of the assets of the Company in which outstanding shares of
Common Stock are exchanged for securities, cash or other property of any other
corporation or business entity or in the event of a liquidation of the Company,
the Board of Directors of the Company, or the board of directors of any
corporation assuming the obligations of the Company, may, in its discretion,
take any one or more of the following actions, as to outstanding options: (i)
provide that such options shall be assumed, or equivalent options shall be
substituted, by the acquiring or succeeding corporation (or an affiliate
thereof), provided that any such options substituted for Incentive Stock Options
shall meet the requirements of Section 424(a) of the Code, (ii) upon written
notice to the optionees, provide that all unexercised options will terminate
immediately prior to the consummation of such transaction unless exercised by
the optionee within a specified period following the date of such notice, (iii)
in the event of a merger under the terms of which holders of the Common Stock of
the Company will receive upon consummation thereof a cash payment for each share
surrendered in the merger (the "Merger Price"), make or provide for a cash
payment to the optionees equal to the difference between (A) the Merger Price
times the number of shares of Common Stock subject to such outstanding options
(to the extent then exercisable at prices not in excess of the Merger Price) and
(B) the aggregate exercise price of all such outstanding options in exchange for
the termination of such options, and (iv) provide that all or any outstanding
options shall become exercisable in full immediately prior to such event.

      (b) Substitute Options. The Company may grant options under the Plan in
substitution for options held by employees of another corporation who become
employees of the Company, or a subsidiary of the Company, as the result of a
merger or consolidation of the employing corporation with the Company or a
subsidiary of the Company, or as a result of the acquisition by the Company, or
one of its subsidiaries, of property or stock of the employing corporation. The
Company may direct that substitute options be granted on such terms and
conditions as the Board of Directors considers appropriate in the circumstances.

17.   No Special Employment Rights.


      Nothing contained in the Plan or in any option shall confer upon any
optionee any right with respect to the continuation of his or her employment by
the Company or interfere in any way with the right of the Company at any time to
terminate such employment or to increase or decrease the compensation of the
optionee.

18.   Other Employee Benefits.


      Except as to plans which by their terms include such amounts as
compensation, the amount of any compensation deemed to be received by an
employee as a result of the exercise of an option or the sale of shares received
upon such exercise will not constitute compensation with respect to which any
other employee benefits of such employee are determined, including, without
limitation, benefits under any bonus, pension, profit-sharing, life insurance or
salary continuation plan, except as otherwise specifically determined by the
Board of Directors.

19.   Amendment of the Plan.


      (a) The Board of Directors may at any time, and from time to time, modify
or amend the Plan in any respect, except that if at any time the approval of the
shareholders of the Company is required under

Section 422 of the Code or any successor provision with respect to Incentive
Stock Options, or under Rule 16b- 3, the Board of Directors may not effect such
modification or amendment without such approval.

      (b) The termination or any modification or amendment of the Plan shall
not, without the consent of an optionee, affect his or her rights under an
option previously granted to him or her. With the consent of the optionee
affected, the Board of Directors may amend outstanding option agreements in a
manner not inconsistent with the Plan. The Board of Directors shall have the
right to amend or modify (i) the terms and provisions of the Plan and of any
outstanding Incentive Stock Options granted under the Plan to the extent
necessary to qualify any or all such options for such favorable federal income
tax treatment (including deferral of taxation upon exercise) as may be afforded
incentive stock options under Section 422 of the Code, and (ii) the terms and
provisions of the Plan and of any outstanding option to the extent necessary to
ensure the qualification of the Plan under Rule 16b-3.

20.   Withholding.


      (a) The Company shall have the right to deduct from payments of any kind
otherwise due to the optionee any federal, state or local taxes of any kind
required by law to be withheld with respect to any shares issued upon exercise
of options under the Plan. Subject to the prior approval of the Company, which
may be withheld by the Company in its sole discretion, the optionee may elect to
satisfy such obligations, in whole or in part, (i) by causing the Company to
withhold shares of Common Stock otherwise issuable pursuant to the exercise of
an option, or (ii) by delivering to the Company shares of Common Stock already
owned by the optionee. The shares so delivered or withheld shall have a fair
market value equal to such withholding obligation. The fair market value of the
shares used to satisfy such withholding obligation shall be determined by the
Company as of the date that the amount of tax to be withheld is to be
determined. An optionee who has made an election pursuant to this Section 20(a)
may only satisfy his or her withholding obligation with shares of Common Stock
which are not subject to any repurchase, forfeiture, unfulfilled vesting or
other similar requirements.

      (b) Notwithstanding the foregoing, in the case of a Reporting Person, no
election to use shares for the payment of withholding taxes shall be effective
unless made in compliance with any applicable requirements of Rule 16b-3 (unless
it is intended that the transaction not qualify for exemption under Rule 16b-3).

21.   Cancellation and New Grant of Options, Etc.

      The Board of Directors shall have the authority to effect, at any time and
from time to time, with the consent of the affected optionees, (i) the
cancellation of any or all outstanding options under the Plan and the grant in
substitution therefor of new options under the Plan covering the same or
different numbers of shares of Common Stock and having an option exercise price
per share which may be lower or higher than the exercise price per share of the
cancelled options, or (ii) the amendment of the terms of any and all outstanding
options under the Plan to provide an option exercise price per share which is
higher or lower than the then-current exercise price per share of such
outstanding options.

22.   Effective Date and Duration of the Plan.


      (a) Effective Date. The Plan shall become effective when adopted by the
Board of Directors, but no option granted under the Plan shall become
exercisable unless and until the Plan shall have been approved by the Company's
shareholders. If such shareholder approval is not obtained within twelve months
after the date of the Board's adoption of the Plan, options previously granted
under the Plan shall not vest and shall terminate and no options shall be
granted thereafter. Amendments to the Plan not requiring shareholder approval
shall become effective when adopted by the Board of Directors; amendments
requiring

shareholder approval (as provided in Section 19) shall become effective when
adopted by the Board of Directors, but no option granted after the date of such
amendment shall become exercisable (to the extent that such amendment to the
Plan was required to enable the Company to grant such option to a particular
person) unless and until such amendment shall have been approved by the
Company's shareholders. If such shareholder approval is not obtained within
twelve months of the Board's adoption of such amendment, any options granted on
or after the date of such amendment shall terminate to the extent that such
amendment was required to enable the Company to grant such option to a
particular optionee. Subject to this limitation, options may be granted under
the Plan at any time after the effective date and before the date fixed for
termination of the Plan.

      (b) Termination. Unless sooner terminated in accordance with Section 16,
the Plan shall terminate upon the close of business on the day next preceding
the tenth anniversary of the date of its adoption by the Board of Directors.
Options outstanding on such date shall continue to have force and effect in
accordance with the provisions of the instruments evidencing such options.

23.   Provision for Foreign Participants.

      The Board of Directors may, without amending the Plan, modify awards or
options granted to participants who are foreign nationals or employed outside
the United States to recognize differences in laws, rules, regulations or
customs of such foreign jurisdictions with respect to tax, securities, currency,
employee benefit or other matters.

      Adopted by the Board of Directors on August 1, 1996.

EX-4.7

                                                                     EXHIBIT 4.7

                             MERCATOR SOFTWARE, INC.

                           1997 EQUITY INCENTIVE PLAN


 As Adopted May 8, 1997 and Amended July 21, 1997, January 27, 1999, March 17,
1999, May 18, 1999, April 3, 2000, June 19, 2000, May 17, 2001, August 15, 2001
                                and May 14, 2002

            1. PURPOSE. The purpose of this Plan is to provide incentives to
attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options, Restricted Stock and Stock
Bonuses. Capitalized terms not defined in the text are defined in Section 23.

            2. SHARES SUBJECT TO THE PLAN.


               2.1 Number of Shares Available. Subject to Sections 2.2 and 18,
the total number of Shares reserved and available for grant and issuance
pursuant to Awards made under this Plan will be 12,200,000 Shares until December
31, 2002. On January 1, 2003, the total number of Shares reserved and available
for grant and issuance pursuant to Awards made under this Plan will be increased
by the lesser of (a) 7.5% of the number of Shares outstanding on the close of
business immediately preceding January 1, 2003, or (b) 3,000,000 Shares. Subject
to Sections 2.2 and 18, Shares will again be available for grant and issuance in
connection with future Awards under the Plan if the shares: (a) are subject to
issuance upon exercise of an Option but cease to be subject to such Option for
any reason other than exercise of such Option; (b) are subject to an Award
granted hereunder but are forfeited or are repurchased by the Company at the
original issue price; or (c) are subject to an Award that otherwise terminates
without Shares being issued. Any authorized shares not issued or subject to
outstanding grants under the Company's 1993 Stock Option Plan (the "Prior Plan")
on the Effective Date (as defined below) and any shares that: (a) are issuable
upon exercise of options granted pursuant to the Prior Plan that expire or
become unexercisable for any reason without having been exercised in full or (b)
are subject to an option granted pursuant to the Prior Plan but are forfeited or
are repurchased by the Company at the original issue price; will no longer be
available for grant and issuance under the Prior Plan, but will be available for
grant and issuance under this Plan. At all times the Company shall reserve and
keep available a sufficient number of Shares as shall be required to satisfy the
requirements of all outstanding Options granted under this Plan and all other
outstanding but unvested Awards granted under this Plan. No Participant may
receive (a) Restricted Stock Awards, (b) Stock Bonus Awards, or (c) Options with
an Exercise Price below Fair Market Value for more than 150,000 Shares over the
term of the Plan, and the sum of such awards issued under this Plan may not
exceed 300,000 Shares in the aggregate over the term of the Plan.

               2.2 Adjustment of Shares. In the event that the number of
outstanding Shares is changed by a stock dividend, recapitalization, stock
split, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of the Company without consideration,
then (a) the number of Shares reserved for issuance under this Plan, (b) the
Exercise Prices of and number of Shares subject to outstanding Options, and (c)
the number of Shares subject to other outstanding Awards will be proportionately
adjusted, subject to any required action by the Board or the stockholders of the
Company and compliance with applicable securities laws; provided, however, that
fractions of a Share will not be issued but will either be replaced by a cash
payment equal to the Fair

Market Value of such fraction of a Share or will be rounded up to the nearest
whole Share, as determined by the Committee.

            3. ELIGIBILITY. ISO (as defined in Section 5 below) may be granted
only to employees (including officers and directors who are also employees) of
the Company or of a Parent or Subsidiary of the Company. All other Awards may be
granted to employees, officers, directors, consultants, independent contractors
and advisors of the Company or any Parent or Subsidiary of the Company; provided
such consultants, contractors and advisors render bona fide services not in
connection with the offer and sale of securities in a capital-raising
transaction. No person will be eligible to receive more than 300,000 Shares in
any calendar year under this Plan pursuant to the grant of Awards hereunder,
other than new employees of the Company or of a Parent or Subsidiary of the
Company (including new employees who are also officers and directors of the
Company or any Parent or Subsidiary of the Company) who are eligible to receive
up to a maximum of 1,000,000 Shares in the calendar year in which they commence
their employment. A person may be granted more than one Award under this Plan.

            4. ADMINISTRATION.

               4.1 Committee Authority. This Plan will be administered by the
Committee. Subject to the general purposes, terms and conditions of this Plan,
the Committee will have full power to implement and carry out this Plan. Without
limiting the previous sentence, the Committee will have the authority to:

                  (a) construe and interpret this Plan, any Award Agreement and
any other agreement or document executed pursuant to this Plan;

                  (b) prescribe, amend and rescind rules and regulations
relating to this Plan, including determining the forms and agreements used in
connection with this Plan; provided that the Committee may delegate to the
President and Chief Executive Officer or the Chief Financial Officer, the
authority to approve revisions to the forms and agreements used in connection
with this Plan that are designed to facilitate Plan administration, and that are
not inconsistent with this Plan or with any resolutions of the Committee
relating to this Plan;

                  (c) select persons to receive Awards; provided that the
Committee may delegate to one or more executive officers of the Company who are
also members of the Board, the authority to grant an Award under this Plan to
Participants who are not Insiders of the Company;

                  (d) determine the terms of Awards;

                  (e) determine the number of Shares or other consideration
subject to Awards;

                  (f) determine whether Awards will be granted singly, in
combination or in tandem with, in replacement of, or as alternatives to, other
Awards under this Plan or any other incentive or compensation plan of the
Company or any Parent or Subsidiary of the Company;

                  (g) grant waivers of Plan or Award conditions;

                  (h) determine the vesting, exercisability and payment of
Awards;



                                      -2-

                  (i) correct any defect, supply any omission or reconcile any
inconsistency in this Plan, any Award or any Award Agreement;

                  (j) determine whether an Award has been earned; and

                  (k) amend this Plan, except for amendments that increase the
number of Shares available for issuance under this Plan or change the
eligibility criteria for participation in this Plan, or any other amendments
that would require approval of the stockholders of the Company;

                  (l) make all other determinations necessary or advisable for
the administration of this Plan.

               4.2 Committee Interpretation and Discretion. Any determination
made by the Committee with respect to any Award will be made in its sole
discretion at the time of grant of the Award or, unless in contravention of any
express term of this Plan or Award, at any later time, and such determination
will be final and binding on the Company and on all persons having an interest
in any Award under this Plan. Any dispute regarding the interpretation of this
Plan or any award Agreement shall be submitted by the participant or the Company
to the Committee for review. The resolution of such a dispute by the Committee
shall be final and binding on the Company and the Participant.

            5. OPTIONS. The Committee may grant Options to eligible persons and
will determine whether such Options will be Incentive Stock Options within the
meaning of the Code ("ISO") or Non-Qualified Stock Options ("NQSO"), the number
of Shares subject to the Option, the Exercise Price of the Option, the period
during which the Option may be exercised, and all other terms and conditions of
the Option, subject to the following:

               5.1 Form of Option Grant. Each Option granted under this Plan
will be evidenced by an Award Agreement which will expressly identify the Option
as an ISO or an NQSO ("Stock Option Agreement"). The Stock Option Agreement will
be substantially in a form (which need not be the same for each Participant)
that the Committee or an officer of the Company (pursuant to Section 41(b)) has
from time to time approved, and will comply with and be subject to the terms and
conditions of this Plan.

               5.2 Date of Grant. The date of grant of an Option will be the
date on which the Committee makes the determination to grant such Option, unless
a later date is otherwise specified by the Committee. The Stock Option Agreement
and a copy of this Plan will be delivered to the Participant within a reasonable
time after the granting of the Option.

               5.3 Exercise Period. Options may be exercisable within the times
or upon the occurrence of events determined by the Committee and set forth in
the Stock Option Agreement governing such Option; subject to the provisions of
Section 5.6 and subject to Company policies established by the Committee (or by
individuals to whom the Committee has delegated responsibility) from time to
time with respect to vesting during leaves of absences. No Option will be
exercisable after the expiration of ten (10) years from the date the Option is
granted; provided however that no ISO granted to a person who directly or by
attribution owns more than ten percent (10%) of the total combined voting power
of all classes of stock of the Company or of any Parent or Subsidiary of the
Company ("Ten Percent Stockholder") will be exercisable after the expiration of
five (5) years from the date the ISO is granted. The Committee also may provide
for Options to become exercisable at one time or from time to time, periodically
or otherwise, in such number of Shares or percentage of Shares as the Committee
determines.



                                      -3-

               5.4 Exercise Price. The Exercise Price of an Option will be
determined by the Committee when the Option is granted and may not be less than
85% of the Fair Market Value of the Shares on the date of grant; provided that:
(i) the Exercise Price of an ISO will not be less than 100% of the Fair Market
Value of the Shares on the date of grant; and (ii) the Exercise Price of any ISO
granted to a Ten Percent Stockholder will not be less than 110% of the Fair
Market Value of the Shares on the date of grant. Payment for the Shares
purchased must be made in accordance with Section 8 of this Plan and the Stock
Option Agreement.

               5.5 Method of Exercise. Options may be exercised only by delivery
to the Company of a written stock option exercise agreement (the "Exercise
Agreement"). The Exercise Agreement will be substantially in a form (which need
not be the same for each Participant), that the Committee or an Officer of the
Company (pursuant to Section 4.1(b)) has from time to time approved and shall
state the number of Shares being purchased, the restrictions imposed on the
Shares purchased under such Exercise Agreement, if any, and such representations
and agreements regarding Participant's investment intent and access to
information and other matters, if any, as may be required or desirable by the
Company to comply with applicable securities laws, together with payment in full
of the Exercise Price for the number of shares being purchased.

               5.6 Termination.


                  (a) Termination for Other than Cause. An Option granted to a
Participant will cease to vest on the Participant's Termination. Following the
Participant's Termination, the Participant's Option may be exercised (to the
extent such Option was exercisable immediately prior to the Termination Date):

                     (i) no later than three (3) months after the Termination
Date if the Participant is Terminated for any reason except death or Disability,
unless a shorter or longer time period not exceeding five (5) years is
specifically set forth in the Participant's Stock Option Agreement; provided
that any exercise of an ISO more than three (3) months after the Termination
Date is deemed to be an NQSO, and provided further than no Option may be
exercised later than the expiration date of the Option.

                     (ii) no later than twelve (12) months after the Termination
Date if the Participant is Terminated because of Participant's death or
Disability (or the Participant dies within three (3) months after a Termination
other than because of Participant's death or Disability), unless a shorter or
longer time period not exceeding five (5) years is specifically set forth in the
Participant's Stock Option Agreement; provided that any exercise of an ISO more
than twelve (12) months after the Termination Date when the Termination is for
Participant's Disability is deemed to be an NQSO, and provided further that no
option may be exercised later than the expiration date of the Option.

                  (b) Termination for Cause. Notwithstanding the provisions in
paragraph 5.6(a) above, if a Participant is determined by the Board to have
committed an act of theft, embezzlement, fraud, dishonesty or a breach of
fiduciary duty to the Company or Subsidiary, neither the Participant, the
Participant's estate nor such other person who may then hold the Option shall be
entitled to exercise any Option with respect to any Shares whatsoever, after
termination of service, whether or not after termination of service the
Participant may receive payment from the Company or Subsidiary for vacation pay,
for services rendered prior to termination, for services rendered for the day on
which termination occurs, for salary in lieu of notice, or for any other
benefits. In making such determination, the Board shall give the Participant an
opportunity to present to the Board evidence on his behalf. For


                                      -4-

the purpose of this paragraph, termination of service shall be deemed to occur
on the date when the Company dispatches notice or advice to the Participant that
his service is terminated.

               5.7 Limitations on Exercise. The Committee may specify a
reasonable minimum number of Shares that may be purchased on any exercise of an
Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.

               5.8 Limitations on ISO. The aggregate Fair Market Value
(determined as of the date of grant) of Shares with respect to which ISO are
exercisable for the first time by a Participant during any calendar year (under
this Plan or under any other incentive stock option plan of the Company, Parent
or Subsidiary of the Company) will not exceed $100,000. If the Fair Market Value
of Shares on the date of grant with respect to which ISO are exercisable for the
first time by a Participant during any calendar year exceeds $100,000, then the
Options for the first $100,000 worth of Shares to become exercisable in such
calendar year will be ISO and the Options for the amount in excess of $100,000
that become exercisable in that calendar year will be NQSO. In the event that
the Code or the regulations promulgated thereunder are amended after the
Effective Date of this Plan to provide for a different limit on the Fair Market
Value of Shares permitted to be subject to ISO, such different limit will be
automatically incorporated herein and will apply to any Options granted after
the effective date of such amendment.

               5.9 Modification, Extension or Renewal. The Committee may modify,
extend or renew outstanding Options and authorize the grant of new Options in
substitution therefor, provided that any such action may not, without the
written consent of a Participant, impair any of such Participant's rights under
any Option previously granted. Any outstanding ISO that is modified, extended,
renewed or otherwise altered will be treated in accordance with Section 424(h)
of the Code. The Committee may reduce the Exercise Price of outstanding Options
without the consent of Participants affected by a written notice to them;
provided, however, that the Exercise Price may not be reduced below the minimum
Exercise Price that would be permitted under Section 5.4 of this Plan for
Options granted on the date the action is taken to reduce the Exercise Price.

               5.10 No Disqualification. Notwithstanding any other provision in
this Plan, no term of this Plan relating to ISO will be interpreted, amended or
altered, nor will any discretion or authority granted under this Plan be
exercised, so as to disqualify this Plan under Section 422 of the Code or,
without the consent of the Participant affected, to disqualify any ISO under
Section 422 of the Code.

            6. RESTRICTED STOCK. A Restricted Stock Award is an offer by the
Company to sell to an eligible person Shares that are subject to restrictions.
The Committee will determine to whom an offer will be made, the number of Shares
the person may purchase, the price to be paid (the "Purchase Price"), the
restrictions to which the Shares will be subject, and all other terms and
conditions of the Restricted Stock Award, subject to the following:

               6.1 Form of Restricted Stock Award. All purchases under a
Restricted Stock Award made pursuant to this Plan will be evidenced by an Award
Agreement ("Restricted Stock Purchase Agreement") that will be in such form
(which need not be the same for each Participant) as the Committee will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The offer of Restricted Stock will be accepted by the
Participant's execution and delivery of the Restricted Stock Purchase Agreement
and full payment for the Shares to the Company within thirty (30) days from the
date the Restricted Stock Purchase Agreement is delivered to the person. If such
person does not execute and deliver the Restricted Stock Purchase Agreement
along with full


                                      -5-

payment for the Shares to the Company within thirty (30) days, then the offer
will terminate, unless otherwise determined by the Committee.

               6.2 Purchase Price. The Purchase Price of Shares sold pursuant to
a Restricted Stock Award will be determined by the Committee and will be at
least 85% of the Fair Market Value of the Shares on the date the Restricted
Stock Award is granted, except in the case of a sale to a Ten Percent
Stockholder, in which case the Purchase Price will be 100% of the Fair Market
Value. Payment of the Purchase Price must be made in accordance with Section 8
of this Plan.

               6.3 Restrictions. Restricted Stock Awards will be subject to such
restrictions (if any) as the Committee may impose. The Committee may provide for
the lapse of such restrictions in installments and may accelerate or waive such
restrictions, in whole or part, based on length of service, performance or such
other factors or criteria as the Committee may determine.

            7. STOCK BONUSES.

               7.1 Awards of Stock Bonuses. A Stock Bonus is an award of Shares
(which may consist of Restricted Stock) for services rendered to the Company or
any Parent or Subsidiary of the Company. A Stock Bonus may be awarded for past
services already rendered to the Company, or any Parent or Subsidiary of the
Company (provided that the Participant pays the Company the par value of the
shares awarded by such Stock Bonus in cash) pursuant to an Award Agreement (the
"Stock Bonus Agreement") that will be in such form (which need not be the same
for each Participant) as the Committee will from time to time approve, and will
comply with and be subject to the terms and conditions of this Plan. A Stock
Bonus may be awarded upon satisfaction of such performance goals as are set out
in advance in the Participant's individual Award Agreement (the "Performance
Stock Bonus Agreement") that will be in such form (which need not be the same
for each Participant) as the Committee will from time to time approve, and will
comply with and be subject to the terms and conditions of this Plan. Stock
Bonuses may vary from Participant to Participant and between groups of
Participants, and may be based upon the achievement of the Company, Parent or
Subsidiary and/or individual performance factors or upon such other criteria as
the Committee may determine.

               7.2 Terms of Stock Bonuses. The Committee will determine the
number of Shares to be awarded to the Participant and whether such Shares will
be Restricted Stock. If the Stock Bonus is being earned upon the satisfaction of
performance goals pursuant to a Performance Stock Bonus Agreement, then the
Committee will determine: (a) the nature, length and starting date of any period
during which performance is to be measured (the "Performance Period") for each
Stock Bonus; (b) the performance goals and criteria to be used to measure the
performance, if any; (c) the number of Shares that may be awarded to the
Participant; and (d) the extent to which such Stock Bonuses have been earned.
Performance Periods may overlap and Participants may participate simultaneously
with respect to Stock Bonuses that are subject to different Performance Periods
and different performance goals and other criteria. The number of Shares may be
fixed or may vary in accordance with such performance goals and criteria as may
be determined by the Committee. The Committee may adjust the performance goals
applicable to the Stock Bonuses to take into account changes in law and
accounting or tax rules and to make such adjustments as the Committee deems
necessary or appropriate to reflect the impact of extraordinary or unusual
items, events or circumstances to avoid windfalls or hardships.

               7.3 Form of Payment. The earned portion of a Stock Bonus may be
paid currently or on a deferred basis with such interest or dividend equivalent,
if any, as the Committee may determine. Payment may be made in the form of cash,
whole Shares, including Restricted Stock, or a combination thereof, either in a
lump sum payment or in installments, all as the Committee will determine.

                                      -6-


               7.4 Termination During Performance Period. If a Participant is
Terminated during a Performance Period for any reason, then such Participant
will be entitled to payment (whether in Shares, cash or otherwise) with respect
to the Stock Bonus only to the extent earned as of the date of Termination in
accordance with the Performance Stock Bonus Agreement, unless the Committee will
determine otherwise.

            8. PAYMENT FOR SHARE PURCHASES.


               8.1 Payment. Payment for Shares purchased pursuant to this Plan
may be made by any of the following methods (or any combination of such methods)
that are described in the applicable Stock Option Agreement or other Award
Agreement and that are permitted by law:

                  (a) in cash (by check);

                  (b) by cancellation of indebtedness of the Company to the
Participant;

                  (c) by surrender of shares that either: (1) have been owned by
Participant for more than six (6) months and have been paid for within the
meaning of SEC Rule 144 (and, if such shares were purchased from the Company by
use of a promissory note, such note has been fully paid with respect to such
shares); or (2) were obtained by Participant in the public market;

                  (d) by tender of a full recourse promissory note having such
terms as may be approved by the Committee and bearing interest at a rate
sufficient to avoid imputation of income under Sections 483 and 1274 of the
Code; provided, however, that Participants who are not employees or directors of
the Company will not be entitled to purchase Shares with a promissory note
unless the note is adequately secured by collateral other than the Shares;
provided, further, that the portion of the Purchase Price or Exercise Price
equal to the par value of the Shares, if any, must be paid in cash;

                  (e) by waiver of compensation due or accrued to the
Participant for services rendered; provided, however, that the portion of the
Purchase Price or Exercise Price equal to the par value of the Shares, if any,
must be paid in cash; or

                  (f) with respect only to purchases upon exercise of an Option,
and provided that a public market for the Company's stock exists:

                     (1) through a "same day sale" commitment from the
Participant and a broker-dealer that is a member of the National Association of
Securities Dealers (a "NASD Dealer") whereby the Participant irrevocably elects
to exercise the Option and to sell a portion of the Shares so purchased to pay
for the Exercise Price, and whereby the NASD Dealer irrevocably commits upon
receipt of such Shares to forward the Exercise Price directly to the Company; or

                     (2) through a "margin" commitment from the Participant and
a NASD Dealer whereby the Participant irrevocably elects to exercise the Option
and to pledge the Shares so purchased to the NASD Dealer in a margin account as
security for a loan from the NASD Dealer in the amount of the Exercise Price,
and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
forward the Exercise Price directly to the Company.



                                      -7-

               8.2 Loan Guarantees. The Committee may, in its sole discretion,
help the Participant pay for Shares purchased under this Plan by authorizing a
guarantee by the Company of a third-party loan to the Participant.


               8.3 Issuance of Shares. Upon payment of the applicable Purchase
Price or Exercise Price (or a commitment for payment from the NASD Dealer
designated by the Participant in the case of an exercise by means of a "same-day
sale" or "margin" commitment), and compliance with other conditions and
procedures established by the Company for the purchase of shares, the Company
shall issue the Shares registered in the name of Participant (or in the name of
the NASD Dealer designated by the Participant in the case of an exercise by
means of a "same-day sale" or "margin" commitment) and shall deliver
certificates representing the Shares (in physical or electronic form, as
appropriate). The Shares may be subject to legends or other restrictions as
described in Section 13 of the Plan.

            9. WITHHOLDING TAXES.


               9.1 Withholding Generally. Whenever Shares are to be issued under
Awards granted under this Plan, the Company may require the Participant to pay
to the Company an amount sufficient to satisfy federal, state and local
withholding tax requirements prior to the delivery of any certificate(s) for the
Shares. If a payment in satisfaction of an Award is to be made in cash, the
payment will be net of an amount sufficient to satisfy federal, state, and local
withholding tax requirements.

               9.2 Stock Withholding. When, under applicable tax laws, a
Participant incurs tax liability in connection with the exercise or vesting of
any Award that is subject to tax withholding and the Participant is obligated to
pay the Company the amount required to be withheld, the Committee may in its
sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be issued
that number of Shares having a Fair Market Value equal to the minimum amount
required to be withheld, determined on the date that the amount of tax to be
withheld is to be determined. All elections by a Participant to have Shares
withheld for this purpose will be made in accordance with the requirements
established by the Committee and must be in writing in a form acceptable to the
Committee

            10. PRIVILEGES OF STOCK OWNERSHIP.


               10.1 Voting and Dividends. No Participant will have any of the
rights of a stockholder of the Company with respect to any Shares until the
Shares are issued to the Participant. After Shares are issued to the
Participant, the Participant will be a stockholder and have all the rights of a
stockholder with respect to the Shares; provided, however, that if the Shares
are Restricted Stock, any new, additional or different securities the
Participant may become entitled to receive with respect to the Shares by virtue
of a stock dividend, stock split or any other change in the corporate or capital
structure of the Company will be subject to the same restrictions as the
Restricted Stock; provided, further, that the Participant will have no right to
retain such stock dividends or stock distributions with respect to Shares that
are repurchased at the Participant's original Purchase Price pursuant to Section
12.

            11. TRANSFERABILITY. Except as set forth below (i) no Option shall
be transferable by any Participant other than by will or the laws of descent and
distribution and (ii) Options may be exercised during the Participant's lifetime
only by the Participant (or, if the Participant is disabled and so long as the
Option remains exercisable, by the Participant's duly appointed guardian or
other legal representative). However, the Committee may, in its discretion,
permit a Participant holding an NQSO to transfer the NQSO to (i) one or more
members of his or her immediate family (including the Participant's spouse and
lineal descendants and spouses of lineal descendants); (ii) trusts for the
benefit


                                      -8-

of the Participant and/or any person referred to in clause (i); (iii) entities
wholly-owned by the Participant and/or any persons or trusts referred to in
clauses (i) or (ii); or (iv) charitable organizations) for estate planning
purposes. In connection with permitting transfers, the Committee may require
that (i) no consideration be given or payment made for any such transfer, (ii)
the stock option agreement pursuant to which such NQSO is granted must expressly
provide for transferability in a manner consistent with the Plan, and (iii)
subsequent transfers of the transferred NQSO shall be prohibited except those in
accordance with this Section. Following any such transfer, the NQSO shall
continue to be subject to the same terms and conditions as were applicable
immediately prior to transfer, and the transferee of such NQSO shall be subject
to the applicable terms of the Plan. The events of Termination of employment set
forth in a Participant's Stock Option Agreement shall continue to be applied
with respect to the original holder of such NQSO, following which such NQSO
shall be exercisable by the transferee only to the extent and for the periods
specified in such Stock Option Agreement.

            12. RESTRICTIONS ON SHARES. At the discretion of the Committee, the
Company may reserve to itself and/or its assignee(s) in the Award Agreement a
right to repurchase a portion of or all of a Participant's Shares that are not
"vested" (as defined in the Award Agreement) following the Participant's
Termination at any time within ninety (90) days after the later of Participant's
Termination Date and the date Participant purchases Shares under this Plan, for
cash and/or cancellation of purchase money indebtedness, at the Participant's
Exercise Price or Purchase Price, as the case may be.

            13. CERTIFICATES. All certificates for Shares or other securities
delivered under this Plan (whether in physical or electronic form, as
appropriate) will be subject to such stock transfer orders, legends and other
restrictions that the Committee deems necessary or advisable, including without
limitation restrictions under any applicable federal, state or foreign
securities law, or any rules, regulations and other requirements of the SEC or
any stock exchange or automated quotation system on which the Shares may be
listed.

            14. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve. The
Shares purchased with the promissory note may be released from the pledge on a
pro rata basis as the promissory note is paid.

            15. EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any time or
from time to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and cancellation
of any or all outstanding Awards. The Committee may at any time buy from a
Participant an Award previously granted with payment in cash, Shares (including
Restricted Stock) or other consideration, based on such terms and conditions as
the Committee and the Participant may agree.



                                      -9-

            16. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will
not be effective unless such Award is in compliance with all applicable state,
federal and foreign securities laws, rules and regulations of any governmental
body, and the requirements of any stock exchange or automated quotation system
upon which the Shares may then be listed or quoted, as they are in effect on the
date of grant of the Award and also on the date of exercise or other issuance.
Notwithstanding any other provision in this Plan, the Company will have no
obligation to issue or deliver certificates for Shares under this Plan prior to:
(a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and/or (b) completion of any registration
or other qualification of such Shares under any state, federal or foreign law or
ruling of any governmental body that the Company determines to be necessary or
advisable. The Company will be under no obligation to register the Shares with
the SEC or to effect compliance with the registration, qualification or listing
requirements of any state, federal or foreign securities laws, stock exchange or
automated quotation system, and the Company will have no liability for any
inability or failure to do so.

            17. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award
granted under this Plan will confer or be deemed to confer on any Participant
any right to continue in the employ of, or to continue any other relationship
with, the Company or any Parent or Subsidiary of the Company or limit in any way
the right of the Company or any Parent or Subsidiary of the Company to terminate
Participant's employment or other relationship at any time, with or without
cause.

            18. CORPORATE TRANSACTIONS.

               18.1 Assumption or Replacement of Awards by Successor. In the
event of


                  (a) a dissolution or liquidation of the Company;

                  (b) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation with a wholly-owned
subsidiary, a reincorporation of the Company in a different jurisdiction, or
other transaction in which there is no substantial change in the stockholders of
the Company or their relative stock holdings and the Awards granted under this
Plan are assumed, converted or replaced by the surviving corporation, which
assumption will be binding on all Participants);

                  (c) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger
(other than any stockholder that merges with the Company in such merger, or
which owns or controls another corporation that merges, with the Company in such
merger) cease to own their shares or other equity interest in the Company;

                  (d) the sale of all or substantially all of the assets of the
Company; or

                  (e) the acquisition, sale or transfer of more than 50% of the
outstanding shares of the Company by tender offer or similar transaction;

                  any or all outstanding Awards will automatically vest for one
additional year and may also be assumed, converted or replaced by the surviving
corporation (if any), which assumption, conversion or replacement will be
binding on all Participants. The Committee may, in its sole discretion, provide
for additional accelerated vesting of any or all Awards that are assumed,
converted or replaced by the surviving corporation. In lieu of assuming,
converting or replacing such Awards, the surviving corporation may substitute
equivalent Awards or provide substantially similar consideration to



                                      -10-

Participants as was provided to stockholders (after taking into account the
existing provisions of the Awards and the one year additional vesting). The
surviving corporation may also issue, in place of outstanding Shares of the
Company held by the Participant, substantially similar shares or other property
subject to repurchase restrictions no less favorable to the Participant. In the
event such surviving corporation (if any) refuses to assume or substitute
Awards, as provided above, pursuant to a transaction described in this
Subsection 18.1, such Awards will automatically vest for one additional year and
will expire on such transaction at such time and on such conditions as the
Committee will determine, provided, however, that the Committee may, in its sole
discretion, provide for additional accelerated vesting of any or all Awards
granted pursuant to this Plan. If such accelerated options are not exercised
prior to the consummation of the corporate transaction, they shall terminate in
accordance with the provisions of this Plan.

               18.2 Other Treatment of Awards. Subject to any greater rights
granted to Participants under the foregoing provisions of this Section 18, in
the event of the occurrence of any transaction described in Section 18.1, any
outstanding Awards will be treated as provided in the applicable agreement or
plan of merger, consolidation, dissolution, liquidation, sale of assets or other
"corporate transaction."

               18.3 Assumption of Awards by the Company. The Company, from time
to time, also may substitute or assume outstanding awards granted by another
company, whether in connection with an acquisition of such other company or
otherwise, by either; (a) granting an Award under this Plan in substitution of
such other company's award; or (b) assuming such award as if it had been granted
under this Plan if the terms of such assumed award could be applied to an Award
granted under this Plan. Such substitution or assumption will be permissible if
the holder of the substituted or assumed award would have been eligible to be
granted an Award under this Plan if the other company had applied the rules of
this Plan to such grant. In the event the Company assumes an award granted by
another company, the terms and conditions of such award will remain unchanged
(except that the exercise price and the number and nature of Shares issuable
upon exercise of any such option will be adjusted appropriately pursuant to
Section 424(a) of the Code). In the event the Company elects to grant a new
Option rather than assuming an existing option, such new Option may be granted
with a similarly adjusted Exercise Price.

            19. ADOPTION AND STOCKHOLDER APPROVAL. This Plan became effective on
the date on which the registration statement filed by the Company with the SEC
under the Securities Act registering the initial public offering of the
Company's Common Stock is declared effective by the SEC (the "Effective Date").
This Plan was approved by the stockholders of the Company, consistent with
applicable laws, within twelve (12) months after the date this Plan was adopted
by the Board.

            20. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as
provided herein, this Plan will terminate ten (10) years from the date this Plan
was adopted by the Board. This Plan and all agreements thereunder shall be
governed by and construed in accordance with the laws of the State of
Connecticut.

            21. AMENDMENT OR TERMINATION OF PLAN. The Board may at any time
terminate or amend this Plan in any respect, including without limitation
amendment of any form of Award Agreement or instrument to be executed pursuant
to this Plan. In addition, pursuant to Section 4.1(k), the Board has delegated
to the Committee the authority to make certain amendments to this Plan.
Notwithstanding the foregoing, neither the Board nor the Committee shall without
the approval of the stockholders of the Company amend this Plan in any manner
that requires such stockholder approval pursuant to the Code or the regulation
promulgated thereunder as such provisions


                                      -11-

apply to ISO plans, pursuant to the Exchange Act or any rule promulgated
thereunder or any rules or regulations promulgated by the Stock exchange or
automated quotation system on which the Company's Stock is quoted. No amendment
that is detrimental to a Participant may be made to any outstanding Award
without the consent of the Participant.

            22. NON-EXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan
by the Board, the submission of this Plan to the stockholders of the Company for
approval, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including, without limitation, the
granting of stock options and bonuses otherwise than under this Plan, and such
arrangements may be either generally applicable or applicable only in specific
cases.

            23. DEFINITIONS. As used in this Plan, the following terms will have
the following meanings:


               "Award" means any award under this Plan, including any Option,
Restricted Stock or Stock Bonus.

               "Award Agreement" means, with respect to each Award, the signed
written agreement between the Company and the Participant setting forth the
terms and conditions of the Award.

               "Board" means the Board of Directors of the Company.

               "Code" means the Internal Revenue Code of 1986, as amended, and
the regulations promulgated thereunder.

               "Committee" means the committee appointed by the Board to
administer this Plan, or if no such committee is appointed, the Board. The
Committee, if appointed, will consist of not less than two members of the Board.

               "Company" means Mercator Software, Inc. or any successor
corporation.

               "Disability" means a disability within the meaning of Section
22(e)(3) of the Code, as determined by the Committee.

               "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

               "Exercise Price" means the price at which a holder of an Option
may purchase the Shares issuable upon exercise of the Option.

               "Fair Market Value" means, as of any date, the value of a share
of the Company's Common Stock determined as follows:

                  (a) if such Common Stock is then quoted on the Nasdaq National
Market, its closing price on the Nasdaq National Market on the date of
determination (grant date) as reported in The Wall Street Journal;

                  (b) if such Common Stock is publicly traded and is then listed
on a national securities exchange, its closing price on the date of
determination on the principal national securities exchange on which the Common
Stock is listed or admitted to trading as reported in The Wall Street Journal;



                                      -12-

                  (c) if such Common Stock is publicly traded but is not quoted
on the Nasdaq National Market nor listed or admitted to trading on a national
securities exchange, the average of the closing bid and asked prices on the date
of determination as reported in The Wall Street Journal;

                  (d) in the case of an Award made on the Effective Date, the
price per share at which shares of the Company's Common Stock are initially
offered for sale to the public by the Company's underwriters in the initial
public offering of the Company's Common Stock pursuant to a registration
statement filed with the SEC under the Securities Act; or

                  (e) if none of the foregoing is applicable, by the Committee
in good faith.

               "Insider" means an officer or director of the Company or any
other person whose transactions in the Company's Common Stock are subject to
Section 16 of the Exchange Act.

               "Option" means an award of an option to purchase Shares pursuant
to Section 5.

               "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if each of such
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.

               "Participant" means a person who receives an Award under this
Plan.

               "Plan" means this Mercator Software, Inc. 1997 Equity Incentive
Plan, as amended from time to time.

               "Restricted Stock Award" means an award of Shares pursuant to
Section 6.

               "SEC" means the Securities and Exchange Commission.

               "Securities Act" means the Securities Act of 1933, as amended.

               "Shares" means shares of the Company's Common Stock reserved for
issuance under this Plan, as adjusted pursuant to Sections 2 and 18, and any
successor security.

               "Stock Bonus" means an award of Shares, or cash in lieu of
Shares, pursuant to Section 7.

               "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.

               "Termination" or "Terminated" means, for purposes of this Plan
with respect to a Participant, that the Participant has for any reason ceased to
provide services as an employee, officer, director, consultant, independent
contractor, or advisor to the Company or a Parent or Subsidiary of the Company.
An employee will not be deemed to have ceased to provide services in the case of
(i) sick leave, (ii) military leave, or (iii) any other leave of absence
approved by the Committee, provided, that such leave is for a period of not more
than 90 days, unless reemployment upon the expiration of such


                                      -13-

leave is guaranteed by contract or statute or unless provided otherwise pursuant
to formal policy adopted from time to time by the Company and issued and
promulgated to employees in writing. In the case of any employee on an approved
leave of absence, the Committee may make such provisions respecting suspension
of vesting of the Award while on leave from the employ of the Company or a
Subsidiary as it may deem appropriate, except that in no event may an Option be
exercised after the expiration of the term set forth in the Option agreement.
The Committee will have sole discretion to determine whether a Participant has
ceased to provide services and the effective date on which the Participant
ceased to provide services (the "Termination Date").


                                      -14-

EX-5.1

                                                                     Exhibit 5.1


                                                              September 12, 2003


Ascential Software Corporation
50 Washington Street
Westborough, MA 01581

          Re:  Ascential Software Corporation
               Registration Statement on Form S-8
               ----------------------------------

Ladies and Gentlemen:

     We have acted as special counsel to Ascential Software Corporation, a
Delaware corporation (the "Company"), in connection with the Registration
Statement on Form S-8 (the "Registration Statement"), for the purpose of
registering with the Securities and Exchange Commission (the "Commission"),
under the Securities Act of 1933, as amended (the "Securities Act"), (i)
1,833,194 shares (the "Shares") of the Company's common stock, par value $.01
per share, (the "Common Stock"), issuable upon the exercise of options granted
under the TSI International Software Ltd. 1993 Stock Option Plan, the 1996
Novera Software Inc. Stock Option Plan and the Mercator Software, Inc. 1997
Equity Incentive Plan (collectively, the "Plans") and assumed by the Company
(each, an "Option") pursuant to the Agreement and Plan of Merger dated as of
August 2, 2003 by and among the Company, Greek Acquisition Corporation and
Mercator Software, Inc. (the "Merger Agreement") and (ii) the Common Stock
Purchase Rights attached to the Shares (the "Rights").

     This opinion is being furnished in accordance with the requirements of Item
601(b)(5) of Regulation S-K under the Securities Act.

     In connection with this opinion, we have examined and relied upon originals
or copies, certified or otherwise identified to our satisfaction, of (i) the
Registration Statement in the form to be filed with the Commission on the date
hereof under the Securities Act; (ii) the Merger Agreement; (iii) the
Certificate of


Ascential Software Corporation
September 12, 2003
Page 2


Ownership and Merger, dated September 12, 2003, as filed with the Secretary of
State of the State of Delaware effecting the merger contemplated by the Merger
Agreement; (iv) the Restated Certificate of Incorporation and the Restated
Bylaws of the Company, each as currently in effect; (v) certain resolutions of
the Board of Directors of the Company; (vi) the Plans; (vii) the First Amended
and Restated Rights Agreement, dated as of August 12, 1997, between Informix
Corporation and BankBoston N.A., as Rights Agent (the "Rights Agreement");
(viii) Amendment No. 1 to the First Amended Restated Rights Agreement, dated as
of November 17, 1997, between Informix Corporation (the Company's former name)
and BankBoston N.A., as Rights Agent; (ix) Amendment No. 2 to the First Amended
and Restated Rights Agreement, dated as of April 26, 2002, between the Company
and EquiServe Trust Company, N.A., as successor Rights Agent; and (x) a form of
rights certificate evidencing the Rights (the "Rights Certificate"). We have
also examined originals or copies, certified or otherwise identified to our
satisfaction, of such records of the Company and such other documents,
certificates and records as we have deemed necessary or appropriate as a basis
for the opinion set forth herein.

     In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or photostatic copies and the
authenticity of the originals of such copies. In making our examination of
documents executed by parties other than the Company, we have assumed that such
parties had the power, corporate or other, to enter into and perform all
obligations thereunder and have also assumed the due authorization by all
requisite action, corporate or other, and execution and delivery by such parties
of such documents and the validity and binding effect thereof on such parties.
As to any facts material to the opinions expressed herein which we have not
independently established or verified, we have relied upon statements and
representations of officers and other representatives of the Company and others.

     We have also assumed that each option agreement setting forth the terms of
each Option granted under each of the Plans is consistent with the respective
Plan and was duly authorized and validly executed and delivered by the parties
thereto, and that the consideration received by the Company for the Shares
delivered upon the exercise of each such Option will be in an amount at least
equal to the par value of the Common Stock.

     Members of our firm are admitted to the bar in the State of Delaware, and
we do not express any opinion as to the laws of any other jurisdiction.


Ascential Software Corporation
September 12, 2003
Page 3


     Based upon and subject to the foregoing, we are of the opinion that:

     1.   The Shares have been duly authorized for issuance and, when issued and
paid upon the exercise of an Option duly granted under a Plan in accordance with
the provisions of such Plan and the applicable option agreement, will be validly
issued, fully paid and nonassessable.

     2.   The Rights attached to the Shares have been duly authorized for
issuance and, when issued, will be validly issued.

     We hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement. In giving such consent, we do not thereby
admit that we are in the category of persons whose consent is required under
Section 7 of the Securities Act or the rules and regulations of the Commission
promulgated thereunder.


                                    Very truly yours,

                                    /s/ Skadden, Arps, Slate Meagher & Flom LLP

EX-23.2

                                                                    Exhibit 23.2


                          INDEPENDENT AUDITORS' CONSENT

The Board of Directors
Ascential Software Corporation:

We consent to the incorporation by reference in the Registration Statement on
Form S-8 of Ascential Software Corporation of our report dated January 29, 2003,
relating to the consolidated balance sheets of Ascential Software Corporation
and subsidiaries as of December 31, 2002 and 2001, and the related consolidated
statements of operations, stockholders' equity and cash flows for each of the
years in the three-year period ended December 31, 2002, and the related
financial statement schedule, which report appears in the December 31, 2002
annual report on Form 10-K of Ascential Software Corporation.


/s/ KPMG LLP


Boston, Massachusetts
September 12, 2003