Exhibit 10.10
As Amended Through March 23, 1989
as Thereafter Amended
Through July 31, 1992
ELECTROMAGNETIC SCIENCES, INC.
1986 NON-QUALIFIED STOCK OPTION PLAN
ARTICLE I
DEFINITIONS
As used herein, the following terms have the meanings
hereinafter set forth unless the context clearly indicates to the
contrary:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Committee" shall mean the Stock Option Committee of the
Board.
(c) "Company" shall mean Electromagnetic Sciences, Inc.
(d) "Disabled Employee" shall mean an employee of the Company or
any of its Subsidiaries who is unable to engage in any
substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected
to last for a continuous period of not less than twelve months.
(e) "Fair Market Value" shall mean the closing sales price, or
the mean between the closing high "bid" and low "asked" prices,
as the case may be, of the Stock in the over-the-counter market
on the day on which such value is to be determined, as reported
by the National Association of Securities Dealers Automated
Quotation System or successor national quotation service. If the
Stock is listed on a national securities exchange, "Fair Market
Value" shall mean the closing sales price of the Stock on such
national securities exchange on the day on which such value is to
be determined, as reported in the composite quotations for
securities traded on such exchange provided by the National
Association of Securities Dealers or successor national quotation
service. In the event no such quotations are available for the
day in question, "Fair Market Value" shall be determined by
reference to the appropriate prices on the next preceding day for
which such prices are reported.
(f) "Option" shall mean an option to purchase Stock granted
pursuant to the provisions of Article VI hereof.
(g) "Optionee" shall mean a person to whom an Option has been
qranted hereunder.
(h) "Option Price" shall mean the price at which an Optionee may
purchase a share of stock under a Stock Option Agreement.
(i) "Purchasable" shall refer to Stock which may be purchased by
an Optionee under the terms of this Plan after a certain date
specified in his Stock Option Agreement.
(j) "Stock" shall mean the $.10 par value common stock of the
Company or, in the event that the outstanding shares of Stock are
hereinafter changed into or exchanged for shares of a different
stock or securities of the Company or some other corporation,
such other stock or securities.
(k) "Stock Option Agreement" shall mean an agreement between the
Company and the Optionee under which the Optionee may purchase
Stock hereunder.
(1) "Subsidiary" shall mean any corporation, the majority of the
outstanding voting stock of which is owned, directly or
indirectly, by another entity.
ARTICLE II
THE PLAN
2.1 Name. This plan shall be known as the "Electromagnetic
Sciences. Inc. 1986 Non-Qualified Stock Option Plan."
2.2 Purpose. The purpose of the Plan is to advance the interests
of the Company, its Subsidiaries and its shareholders by
affording certain officers and other key employees of the Company
and its Subsidiaries an opportunity to acquire or increase their
proprietary interests in the Company by granting such persons
Options to purchase Stock in the Company. The Options will
promote the growth and profitability of the Company and its
Subsidiaries because the Optionees will be provided with an
additional incentive to achieve the Company's objectives through
participation in its success and growth and by encouraging their
continued employment with the Company.
2.3 Effective Date; Termination Date. The effective date of the
Plan is October 9, 1986. The Plan shall terminate, and no further
Options shall be granted hereunder, on October 9, 1996.
ARTICLE III
PARTICIPANTS
Any "key employee," as determined by the Board or Committee,
including executive personnel and department heads (as well as
officers who are also directors), of the company or its
Subsidiaries shall be eligible to participate in the Plan,
provided that they are full-time employees of the Company or any
of its Subsidiaries. Members of the Committee who otherwise
qualify as key employees shall be eligible to participate.
ARTICLE IV
ADMINISTRATION
4.1 Duties and Powers of Committee. Subject to section 4.3
hereof, the Plan shall be administered by the Board, which may
delegate such authority to the Committee. In administering the
Plan, the Board's or Committee's actions and determinations shall
be binding on all interested parties. Subject to the express
provisions of the Plan, the Board or Committee shall have the
sole discretion and authority to determine the eligible "key
employees," those key employees to whom an Option will be
granted, the time or times at which the Option may be exercised,
the number of shares of Stock subject to the Option, and the
terms and conditions of the Stock Option Agreement. Subject to
the express provisions of the Plan, the Board and Committee shall
also have complete authority to interpret the Plan, to prescribe,
amend and rescind rules and regulations relating to it, and to
make all other determinations necessary or advisable in the
administration of the Plan, including, without limitation, the
amending or altering of the Plan and any Option granted hereunder
as may be required to comply with or to conform to any federal,
state or local laws or regulations. The Board or Committee shall
have the power to authorize the issuance of Stock in accordance
with the provisions of the Plan. No member of the Board or the
Committee shall be liable to any person for any determination
made in good faith with respect to the Plan or any Option granted
hereunder.
4.2 Committee Procedures. If delegated authority hereunder, the
Committee may make such rules and regulations for the conduct of
its business as it may deem necessary or appropriate. A majority
of the members of the Committee shall constitute a quorum, and
any action taken by a majority at a meeting at which a quorum is
present or any action taken without a meeting evidenced by a
writing executed by all the members of the Committee, shall
constitute the action of the Committee. The Committee shall keep
minutes of its meetings.
The Company shall supply full and timely information to the
Committee on all matters relating to eligible persons, their
employment, death, retirement, disability or other termination of
employment, and such other pertinent facts as the Committee may
require. The Company shall furnish the Committee with such
clerical and other assistance as is necessary in the performance
of its duties.
4.3 Director and Officer Options. A committee of the
Board, consisting of two or more directors designated by the
Board, shall have the sole authority and discretion to grant or
modify, or to otherwise exercise powers of the Committee with
respect to, Options to or held by employees who are directors of
the Company, or are officers of the Company for the purposes of
Section 16 of the Securities Exchange Act of 1934, as amended,
provided that no director who is not a "disinterested person,"
for the purposes of Securities and Exchange Commission Rule 16b-3
or any applicable successor thereto, shall serve on such
committee. References elsewhere in this plan to the Board, in
the context of grants or modification of, or exercise of
discretion with respect to, Options to or held by employees who
are directors or such officers, shall be deemed to refer to such
committee.
ARTICLE V
SHARES OF STOCK SUBJECT TO PLAN
5.1 Limitations. Subject to any antidilution adjustment
pursuant to the provisions of Section 5.2 hereof, the maximum
number of shares of Stock which may be issued and sold hereunder
shall not exceed 150,000 shares. Shares subject to an Option may
be either authorized and unissued shares or shares issued and
later acquired by the Company; provided, however, that shares of
Stock with respect to which an Option has been exercised shall
not again be available for option hereunder. If outstanding
Options granted hereunder shall terminate or expire for any
reason without being wholly exercised prior to the end of the
period during which Options may be granted hereunder, new Options
may be granted hereunder covering the unexercised shares of the
terminated or expired Options.
5.2 Antidilution. In the event that the outstanding shares of
Stock are changed into or exchanged for a different number or
kind of shares or other securities of the Company or of another
corporation by reason of merger, consolidation, reorganization,
recapitalization, reclassification, combination of shares, stock
split up or stock dividend:
(a) The aggregate number and kind of shares of Stock on
which Options may be granted hereunder shall be adjusted
appropriately;
(b) The rights under outstanding Options granted hereunder,
both as to the number of subject shares and the Option Price,
shall be adjusted appropriately; and
(c) Where dissolution or liquidation of the Company or any
merger or combination in which the Company is not a surviving
corporation is involved, each outstanding Option granted
hereunder shall terminate, but the Optionee shall have the right,
immediately prior to such dissolution, liquidation, merger or
combination, to exercise his Option, in whole or in part, to the
extent that it shall not have been exercised, without regard to
any installment exercise provisions, subject, however, to the
limitations set forth in Article VI hereof.
The foregoing adjustments and the manner of application
thereof shall be determined solely by the Board or Committee, and
any such adjustment may provide for the elimination of fractional
share interests. The adjustments required under this Article
shall apply to any successor or successors of the Company and
shall be made regardless of the number or type of successive
events requiring adjustments hereunder.
ARTICLE VI
OPTIONS
6.1 Option Grant and Agreement. Each Option granted
hereunder shall be evidenced by minutes of a meeting or the
written consent of the Board or Committee, and by a written Stock
Option Agreement dated as of the date of grant and executed by
the Company and the Optionee. As to each grant hereunder, the
terms of the Option, including the Option's duration, time or
times of exercise, and exercise price, shall be stated in the
Stock Option Agreement or incorporated therein by reference to
the resolution or written consent of the Board or Committee
setting the terms of the Option. The terms and conditions of the
Option shall be consistent with the Plan.
6.2 Option Price. The Option Price of the Stock subject to
each Option shall be determined by the Board or Committee. The
Option Price shall not be less than 50% of the Fair Market Value
of the Stock on the date the Option is granted.
6.3 Exercise Period. The period for the exercise of each
Option shall be determined by the Board or Committee.
6.4 Option Exercise. Unless otherwise provided in the Stock
Option Agreement, an Option shall be exercisable in full or in
part at any time prior to expiration of the Option. The Board or
Committee shall have the authority in its sole discretion to
prescribe in any Stock Option Agreement that the Option may be
exercised in installments during the term of the Option.
An Option may be exercised at any time or from time to time
during the term of the Option as to any or all full shares which
have become Purchasable under the provisions of the Option, but
not at anytime as to less than 25 shares unless the remaining
shares that have become so Purchasable are less than 25 shares.
Option Price is to be paid in full in cash upon the exercise of
the Option and the Company shall not be required to deliver
certificates for such shares until such payment has been made;
provided, however, that in lieu of cash all or any portion of the
Option Price may be paid by tendering to the Company shares of
Stock duly endorsed for transfer and owned by the Optionee, to be
credited against the Option Price at their Fair Market Value on
the date of exercise. The holder of an Option shall not have any
of the rights of a stockholder with respect to the shares of
Stock subject to the Option until such shares have been issued or
transferred to him upon the exercise of his Option.
An Option shall be exercised by written notice of intent to
exercise the Option with respect to a specified number of shares
of Stock delivered to the Company at its principal office, and by
payment in full to the Company in accordance with the preceding
paragraph at said office of the Option Price for the number of
shares of Stock with respect to which the Option is then being
exercised. In addition to and at the time of payment of the
Option Price, the Optionee shall pay to the Company in cash the
full amount of any federal and state withholding or other
employment taxes applicable to the taxable income of such
Optionee resulting from such exercise provided, however, that in
the discretion of the Board or Committee, any Stock Option
Agreement may provide that all or any portion of such tax
obligations, together with additional taxes not exceeding the
actual additional taxes to be owed by the Optionee as a result of
such exercise, may, upon the irrevocable election of the
Optionee, be paid by tendering to the Company shares of Stock
duly endorsed for transfer and owned by the Optionee, or by
authorization to the Company to withhold shares of Stock
otherwise issuable upon exercise of the Option, in either case in
that number of shares having a Fair Market Value at the time of
exercise equal to the amount of such taxes thereby being paid,
and subject to such restrictions as to the approval and timing of
any such election as the Board or Committee may from time to time
determine to be necessary or appropriate to satisfy the
conditions of the exemption set forth in Rule 16b-3 under the
Securities Exchange Act of 1934, as amended.
6.5 Nontransferability of Option. No Option shall be
transferred by an Optionee otherwise than by will or the laws of
descent and distribution. During the lifetime of an Optionee, his
Option shall be exercisable only by him (or by his guardian or
legal representative, should one be appointed).
6.6 Termination of Employment. The Board or the Committee
shall have the power to specify, with respect to the Options
granted to particular Optionees, the effect upon such Optionee's
right to exercise an Option of termination of such Optionee's
employment under various circumstances, which effect may include
immediate or deferred termination of such Optionee's rights under
an Option, or acceleration of the date after which an Option may
be exercised in full.
ARTICLE VII
STOCK CERTIFICATES
The Company shall not be required to issue or deliver a
certificate for shares of Stock purchased upon the exercise of
any Option granted hereunder or any portion thereof, prior to
fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock
exchanges on which the Stock is then listed;
(b) The completion of any registration or other
qualification of such shares under any federal or state law or
under the rules or regulations of the Securities and Exchange
Commission or any other governmental regulatory body, which the
Company upon the advice of counsel shall determine to be
necessary or advisable;
(c) The obtaining of any approval or other clearance from
any federal or state governmental agency which the Company upon
the advice of counsel shall determine to be necessary or
advisable; and
(d) The lapse of such reasonable period of time following
the exercise of the Option as may be appropriate for reasons of
administrative convenience.
ARTICLE VIII
TERMINATION, AMENDMENT AND MODIFICATION OF PLAN
The Board may at any time terminate the Plan, and may at any
time and from time to time and in any respect amend or modify the
Plan; provided, however, that if the Plan is approved by the
stockholders of the Company, the Board may not thereafter,
without further stockholder approval, amend the Plan to:
(a) Increase the total number of shares of Stock subject to
the Plan except as contemplated in Section 5.2 hereof;
(b) Change or modify the class of employees that may
participate in the Plan; or
(c) Otherwise materially increase the benefits accruing to
participants under the Plan.
No termination, amendment or modification of the Plan shall
adversely affect any Option previously granted hereunder without
the written consent of the Optionee or his guardian, legal
representative or legatee.
ARTICLE IX
MISCELLANEOUS
9.1 Plan Binding on Successors. The Plan shall be binding
upon the successors and assigns of the Company.
9.2 Singular, Plural; Gender. Whenever used herein, nouns in
the singular shall include the plural, and the masculine pronoun
shall include the feminine gender.
9.3 Headings, etc., No Part of Plan. Headings of articles
and sections hereof are inserted for convenience and reference;
they constitute no part of the Plan.