Exhibit 10
IMMUNOMEDICS, INC.
1992 STOCK OPTION PLAN
(as amended)
1. Purpose of Plan. The purpose of this 1992 Stock Option Plan is to
promote the interests of Immunomedics, Inc. and its stockholders by encouraging
employees, consultants, members of the Corporation's Scientific Advisory Board,
if any, and members of the Corporation's Board of Directors to acquire a
proprietary interest in the Corporation, thereby increasing the personal
interest and special effort of such persons to achieve sound growth and
profitability for the Corporation, and to enhance the Corporation's efforts to
attract and retain competent Employees, Consultants, Directors and Advisors (as
defined below).
2. Definitions. The following terms when used herein shall have the
meanings set forth below, unless a different meaning is plainly required by the
context:
Advisor. A person who has been appointed to and continues to serve on the
Corporation's Scientific Advisory Board.
Affiliate. A corporation which is a parent corporation or a subsidiary
corporation (within the meaning of Section 424 of the Code) with respect to the
Corporation.
Board. The Board of Directors of the Corporation.
Code. The Internal Revenue Code of 1986 , as it has been and may be amended
from time to time. Reference to any section of the Code shall include any
provision successor thereto.
Committee. The Board; provided, however, that if a committee has been
delegated authority pursuant to Section 8.a. to manage and administer the Plan,
then Committee means such committee.
Common Stock. Shares of the Corporation's common stock, par value $.01 per
share, and any other shares of common stock from time to time authorized
pursuant to the Corporation's Certificate of Incorporation, as amended.
Consultant. A person performing consulting or advisory services to the
Corporation or an Affiliate who is not an Employee.
Corporation. Immunomedics, Inc., a Delaware corporation.
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Director. A person who has elected to and continues to serve on the Board.
Employees. Officers and other persons employed by the Corporation or an
Affiliate, as determined by the Board or the Committee from time to time.
Employment Termination Date. The date the Optionee's service as an Employee
terminates, the date the Optionee's service as a Director terminates, the date
the Optionee's service as an Advisor terminates, or the date the Optionee's
service as a Consultant terminates; or, if the Optionee serves in more than one
of the foregoing capacities, the last of such dates to occur.
Exchange Act. The Securities Exchange Act of 1934, as amended, or any
corresponding provisions of any subsequent Federal securities law.
Incentive Option. An option defined in Section 422A of the Code, which
meets the requirements of Section 5 and 6.
Non-Qualified Option. An option which meets the requirements of Sections 5
and 6.
Option. An Incentive Option or a Non-Qualified Option granted to an
Optionee pursuant to the Plan.
Option Agreement. A written agreement between the Corporation and an
Optionee evidencing the grant of an Option and containing terms and conditions
concerning the exercise of the Option.
Option Price. The price to be paid for shares of Common Stock being
purchased pursuant to the exercise of an Option.
Option Settlement. The cash, shares of Common Stock, or a combination
thereof, which may be paid to an Optionee pursuant to Section 7.
Optionee. An Employee, Director, Consultant or Advisor who has been granted
an Option. Also includes the personal representative, heir or legatee of an
Optionee who has the right to exercise an Option upon the death of an Optionee.
Outside Directors. A Director who is not also an Employee.
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Plan. The 1992 Stock Option Plan provided for herein, as it may be amended
from time to time.
Value. The closing sale price of the Common Stock on the Nasdaq National
Market on the date fair market value is to be determined or, if the Common Stock
is not listed on the Nasdaq National Market, the closing bid price (or the
average of the closing bid price and asked price) on the exchange or system on
which the Common Stock is listed or as quoted by the principal market-maker of
the Common Stock; if the Common Stock cannot be valued by any of the foregoing
methods, fair market value shall be as determined by the Committee.
3. Eligibility and Participation. Persons eligible to receive Options under
the Plan shall be Employees, Directors, Consultants or Advisors selected by the
Committee; provided, Incentive Options shall only be granted to Employees. In
determining persons to whom Options, both Incentive and Non-Qualified, shall be
granted, the number of shares to be covered by each Option, and whether the
Option shall be an Incentive Option or a Non-Qualified Option, or both, the
Committee shall take into account the duties of the respective persons, their
present and potential contribution to the success of the Corporation or any
Affiliate, their anticipated number of years of active service remaining and
such other factors as it deems relevant in connection with accomplishing the
purposes of the Plan. A person who has been granted an Option may be granted an
additional Option or Options as the Committee shall so determine.
4. Shares Subject to the Plan. The shares to be offered under the Plan
shall be the Common Stock, which shares may be authorized but unissued shares or
treasury shares. Subject to the adjustments provided for in Section 9, the
aggregate number of shares of Common Stock to be delivered upon exercise of all
Options granted under the Plan shall not exceed 8,000,000 shares. Shares of
Common Stock subject to, but not delivered under, an Option terminating or
expiring for any reason prior to the exercise thereof in full, shall be deemed
available for Options thereafter granted during the term of the Plan.
5. Terms and Conditions of All Options. All Options granted hereunder shall
be issued subject to the following terms and conditions:
a. Non-Qualified Options may be granted to any Optionee. Incentive
Options shall be granted only to Employees. No Incentive Option shall
be granted to any Optionee who immediately after the granting of an
Incentive Option owns more than 10% of the issued and outstanding
Common Stock, unless such Incentive Option is granted with an Option
Price of not less than 110% of the Value of the Common Stock at the
time of the grant of the Option. For the purpose of this Section 5.a.
and Section 6.d., an Optionee is considered as owning all of the
Common Stock owned by his brothers, sisters, spouse, ancestors and
lineal descendants and his pro-rata share of all Common Stock owned by
corporations, partnerships, estates and trusts in which he has an
interest.
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b. All Options (other than those granted to Consultants) shall be
first execrable as to 25% of the total number of shares of Common
Stock underlying such Option on the first anniversary of the date of
grant, and to an additional 25% of such shares on each of the second,
third and fourth anniversaries of such date of grant.
c. If the Option is an Incentive Option, the aggregate Value
(determined at the time the Incentive Option is granted) of the Common
Stock with respect to which Incentive Options granted hereunder and
incentive stock options granted under any other plan of the
Corporation (or any parent or subsidiary thereof) are exercisable by
the Optionee for the first time in any calendar year shall not exceed
$100,000.
d. Options shall not be transferable by the Optionee otherwise than by
will or the laws of descent and distribution, and shall be exercisable
during his lifetime only by him; except that the Committee, either at
or after the grant of an Option, may permit a Non-Qualified Option to
be transferable to any or all of the spouse, child or grandchild of an
Optionee or to a trustee of a trust for the sole benefit of any or all
of the foregoing persons.
e. Upon an Employment Termination Date (other than as a result of the
death of the Optionee), the Options held by such Optionee at such date
shall terminate; provided, however, that the Committee, in its sole
and uncontrolled discretion, may extend such termination of the
Options until a date not more than three months after such Employment
Termination Date, or if such termination is as a result of the
Optionee's permanent and total disability (as that term is defined in
Section 105(d)(4) of the Code and referred to herein as "Disability")
until a date not more than one year after such Employment Termination
Date. The Committee may, in specific cases and in its sole and
uncontrolled discretion, permit the exercise by an Optionee, within
such three and 12 month periods of all or part of the Options which
was not exercisable on the Employment Termination Date.
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f. In the event of the Optionee's death prior to his Employment
Termination Date or, if the termination date of such Option has been
extended for three months or more in accordance with subsection 5.e.
hereof, his death during such extended period, the Option shall
terminate upon the earlier to occur of (i) 12 months after the date of
the Optionee's death, (ii) the Option's expiration date, or (iii) such
other date as shall be specified in the Option Agreement. The Option
shall be exercisable during such period after the Optionee's death
with respect to the number of shares as to which the Option shall have
been exercisable on the date immediately preceding the Optionee's
death.
g. Any exercise or attempt to exercise any Option by an Optionee, and
any request for any Option Settlement in accordance with Section 7
hereof, during a period commencing 180 days prior to the termination
of such Optionee's employment or other relationship with the
Corporation for any reason and ending 90 days after such termination,
shall be subject to the Corporation's right to (i) deny the exercise
of such Option or such request, (ii) rescind the exercise of such
Option (if the Option has been exercised but the underlying shares of
Common Stock have not been sold), or (iii) be paid by the Optionee,
upon the demand of the Corporation, the amount of any Option
Settlement paid and the amount of profits (i.e., the difference
between the exercise price of the Option and the sale price of the
Common Stock acquired upon such exercise) received by the Optionee as
a result of the exercise of such Option if such Option has been
exercised and the underlying shares of Common Stock have been sold.
The right of the Corporation provided in the foregoing sentence may be
exercised only (i) on or prior to the ninetieth day after termination
of the employment or other relationship of the Optionee with the
Corporation and (ii) if the Board of Directors determines, in good
faith, that the Optionee has breached a material duty or obligation to
the Corporation.
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6. Terms and Conditions of Option Agreement. The Committee shall have the
power, subject to the limitations contained in this Plan, to prescribe
additional terms and conditions in respect of the granting or exercise of any
Option under the Plan and in particular shall prescribe the following terms and
conditions, which shall be contained in the Option Agreement for such Option:
a. Whether the Option is an Incentive Option or a Non-Qualified
Option.
b. The number of shares of Common Stock to which the Option pertains.
c. The exercise price of the Option, which shall not be less than 100%
of the Value of the Common Stock at the time of the grant of the
Option, except as provided in Section 5.a.
d. The term of the Option, which shall not exceed 10 years from the
date on which the Option is granted; provided, if the Optionee owns
more than 10% of the issued and outstanding Common Stock, and the
Option is an Incentive Option, the term shall not exceed five years.
e. The method or time when the Option may be exercised in whole or in
part, for Options granted to Consultants.
f. Whether the Option Price may be paid in whole or in part in shares
of Common Stock then owned by the Optionee.
g. For a Non-Qualified Option, the provisions for the withholding of
Federal, state and local income or other taxes which shall be due in
connection with the exercise of the Non-Qualified Option.
h. For a Non-Qualified Option, whether such Option is transferable by
the Optionee, as permitted by Section 5.d.
i. Each Option Agreement shall provide that, upon request by the
Committee for such a representation, the Optionee shall deliver to the
Committee at the time of any exercise of an Option or portion thereof,
a written representation that the shares of Common Stock to be
acquired upon such exercise are to be acquired for investment and not
for resale or with a view to the distribution thereof. Upon such
request, delivery of such representation prior to the delivery of any
shares of Common Stock issued upon exercise of an Option and prior to
the expiration of the Option period shall be a condition precedent to
the right of the Optionee or such other person to purchase any shares.
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7. Option Settlement Provisions. Each Optionee may request that, in lieu of
exercising an Option, he receive shares of Common Stock, cash, or a combination
of Common Stock and cash, having a fair market value equal to the amount by
which the Value of the shares of Common Stock subject to the Option at the time
of such request exceeds the Option Price (the "Option Settlement"), as follows:
a. The request of the Optionee shall be in a writing delivered to the
Committee during the period commencing with the third day after, and
ending with the twelfth day after the release by the Corporation
quarterly or annual summary statements of earnings of the Corporation.
b. The Committee shall, in its sole discretion, determine whether to
permit an Optionee to receive an Option Settlement in lieu of
exercising the Option and, if the Committee determines to permit the
Optionee to receive an Option Settlement, the Committee, in its sole
discretion, shall determine what portion of the Option Settlement
shall be in cash and what portion shall be in shares of Common Stock.
c. For the purposes of determining the amount of the Option
Settlement, the Value of a share of Common Stock shall be determined
on the date the written request referred to in Section 7.a. is
received by the Committee; provided, that the amount of the Option
Settlement shall not exceed twice the Option Price of the shares of
Common Stock under the Option being canceled. For example, if the
Option Price per share is $7, the Option Settlement cannot exceed $14
per share.
d. Upon the payment of an Option Settlement, the Option with respect
to which the Option Settlement was paid shall be canceled the same as
if the Option had been exercised in full.
8. Administration of Plan.
a. The Plan shall be administered by a committee (the "Committee")
comprised of at least two Outside Directors, each of whom comes within
the definition of "non-employee director" under Rule 16b-3(b)(3)
promulgated under the Exchange Act.
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b. Subject to such orders or resolutions not inconsistent with the
provisions of the Plan, as may from time to time be issued or adopted
by the Board, the Committee shall have full power and authority to
interpret the provisions and supervise the administration of the Plan;
provided, however, that the grants of options to Outside Directors
other than pursuant to Section 8.c. shall be ratified by the Board.
All decisions, determinations and selections made by the Committee
pursuant to the provisions of the Plan and applicable existing orders
or resolutions of the Board shall be final. Each Option granted shall
be evidenced by an Option Agreement containing such terms and
conditions that may be approved by the Committee and which shall not
be inconsistent with the Plan and the orders and resolutions of the
Board with respect thereto.
c. In addition to any other Options granted to Directors by the
Committee, each Outside Director shall be granted Options under the
Plan in accordance with the formula set fourth below:
(i) Outside Directors shall be granted an Option to purchase
10,000 shares of Common Stock upon the date of his election or
appointment to the Board for the first time.
(ii) On each July 1 during the term of the Plan, each Outside
Director who has been a Director for not less than twelve months
prior to such date shall be granted an Option to purchase 10,000
shares of Common Stock, and each Outside Director who has been a
Director for at least three months but less than twelve months
prior to the date of grant, shall receive an Option to purchase
such number of shares of Common Stock determined by multiplying
10,000 times a fraction, the denominator of which is twelve and
the numerator of which is the number of complete months which
such person has served as an Outside Director.
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(iii) All Options granted to Outside Directors shall (1) be
Non-Qualified Options, (2) be exercisable at a price equal to the
Value at the date of grant and (3) be exercisable for a term of
10 years.
9. Adjustments Upon Changes in Capitalization. Not withstanding the
limitation set forth in Section 4, in the event of a merger, consolidation,
reorganization, stock dividend, stock split or other change in corporate
structure or capitalization affecting the Common Stock, the Committee shall make
an appropriate adjustment in the maximum number of shares available under the
Plan or to any one individual and in the number, kind, Option Price, and other
terms relating to shares of Common Stock subject to Options granted under the
Plan. Any such adjustment shall be made so as not to constitute a modification,
extension or renewal of the Option within the meaning of Section 425(h) of the
Code.
10. Time of Granting Options. Except for Options granted pursuant to
Section 8 hereof, nothing contained in the Plan or in any resolution adopted or
to be adopted by the Board or by the stockholders of the Corporation, and no
action taken by the Committee (other than the granting of a specific Option),
shall constitute the granting of an Option hereunder. The granting of an Option
pursuant to the Plan shall take place on the date such Option is approved by the
Committee.
11. Amendment and Discontinuance. The Board may discontinue, amend, alter
or suspend the Plan at any time or from time to time, subject to such approvals
as may be required pursuant to (i) the Code, (ii) the laws of the Corporation's
jurisdiction of incorporation, and (iii) the Exchange Act or the rules
promulgated thereunder. Any Option which is outstanding under the Plan at the
time of its amendment or termination shall remain in effect in accordance with
its terms and conditions and those of the Plan as in effect when the Option was
granted.
12. Merger, Consolidation or Sale of Assets or Stock. In the event that (i)
the Corporation merges or consolidates with another corporation or entity which
results in the Corporation not being the surviving corporation or entity, (ii)
all or substantially all of the Corporation's assets are acquired by another
corporation or entity, (iii) the Corporation is liquidated or dissolved, or (iv)
there is a sale of shares of Common Stock as a result of which any one person or
entity, or any group of persons or entities which are affiliated or which are
acting in concert, becomes the beneficial owner of in excess of fifty percent of
the then outstanding shares of Common Stock, then each Optionee shall have the
right, immediately prior to any such event, to exercise any Option granted
hereunder, in whole or in part, as to the full number of shares which such
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Optionee would otherwise have been able to purchase during the remaining term of
the Option, whether or not otherwise exercisable at such time according to its
terms. In addition, any Optionee may request to receive at such time an Option
Settlement, as provided in Section 7, notwithstanding that such election is not
made during the period set forth in Section 7.a. Upon the occurrence of any such
merger, consolidation or sale of assets, the surviving or acquiring corporation
or entity shall, subject to the provision of the following sentence, adopt the
Plan and upon the exercise of an Option after the closing of such transaction,
the Optionee shall, at no additional costs (other than the Option Price), be
entitled to receive, in lieu of shares of Common Stock, the number and class of
shares of capital stock or other securities to which the Optionee would have
been entitled pursuant to the terms of the merger or consolidation if
immediately prior thereto the Optionee had been the holder of record of such
number of shares of Common Stock as such Optionee would otherwise have been able
to purchase during the remaining term of the Option, whether or not otherwise
exercisable at such time according to its terms. If such surviving or acquiring
corporation or entity does not adopt the Plan, such corporation or entity shall
terminate all outstanding Options under the Plan by paying the holders thereof,
in cash, the difference between the aggregate Option Price of the Options and
the price per share paid for or allocated to the shares of Common Stock in such
transaction.
13. Effectiveness and Termination of the Plan.
a. The Plan shall become effective upon adoption by the Board. The
Plan shall be rescinded and all Options granted hereunder shall be
null and void unless within 12 months from adoption of the Plan it
shall have been approved by a vote of the holders of a majority of all
the issued and outstanding shares of Common Stock present either in
person or by proxy at a meeting duly held for such purpose.
b. The Plan shall terminate on the earliest to occur of:
(i) the date when all shares of Common Stock available under the
Plan shall have been acquired through the exercise of Options
granted under the Plan, or the payment of Settlement Options in
lieu of such exercise;
(ii) 10 years after the date of adoption of the Plan by the
Board; or
(iii) such other date as the Board shall determine.
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14. Governing Law. The provisions of the Plan shall be construed,
administered and enforced according to the laws of the State of Delaware.
15. Miscellaneous.
a. The captions and section headings used herein are for convenience
only, shall not be deemed part of the Plan and shall not in any way
restrict or modify the context and substance of any section or
paragraph hereof.
b. The Plan shall be construed in such a fashion that all Incentive
Options shall qualify as "incentive stock options" under Section 422A
of the Code.
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