EXHIBIT 10.2
CYTOGEN CORPORATION
AMENDED AND RESTATED 1999 STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS
1. Purpose; Effective Date.
(a) The purposes of this Plan are to further the interests of Cytogen
Corporation (the "Company") by retaining the services of persons now serving as
non-employee Directors of the Company, attracting and retaining the services of
persons capable of serving on the Board of Directors of the Company, and by
providing such persons with an incentive that aligns their interests with the
interests of the Company's shareholders.
(b) This Plan will become effective on approval of the Plan by the
affirmative vote of the majority of shares present in person or represented by
proxy at a meeting of the shareholders of the Company and cast on the proposal
for approval of the Plan.
2. Definitions.
Whenever used in this Plan, the following terms will have the meanings set
forth in this Section:
"Board of Directors" means the Board of Directors of the Company.
"Cash Component" means director cash compensation, including but not
limited to annual services fees, fees payable for board and committee meetings
attended and fees for committees chaired.
"Code" means the United States Internal Revenue Code of 1986, as amended.
"Common Stock" means the common stock, par value $.0l per share, of the
Company.
"Compensation Shares" means any shares of Common Stock issued to Eligible
Directors hereunder in payment of such Eligible Director's Cash Component of
compensation.
"Date of Grant" means with respect to any Option the date the Option will
become effective under the provisions of this Plan.
"Disability" means inability of a Director to engage in any substantial
gainful activity by reason of a medically determinable physical or mental
impairment which reasonably can be expected to last for a continuous period of
not less than six months.
"Eligible Director" means, as of any time, a person who is a director of
the Company but is not then an Employee.
"Employee" means any person employed by the Company (including, without
limitation, a person employed by the Company who is also an officer or director
of the Company).
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
rules and regulations promulgated thereunder.
"Exercise Price" means with respect to any Option the price per share which
must be paid upon exercise of the Option.
"Fair Market Value" means (i) if the Common Stock is traded in a market in
which actual transactions are reported, the average of the high and low prices
at which the Common Stock is reported to have traded on the relevant date in all
markets on which trading in the Common Stock is reported, or if there is no
reported sale of the Common Stock on the relevant date, the mean of the highest
reported bid price and lowest reported asked price for the Common Stock on the
relevant date, (ii) if the Common Stock is Publicly Traded but only in markets
in which there is no reporting of actual transactions, the mean of the highest
reported bid price and the lowest reported asked price for the Common Stock on
the relevant date, or (iii) if the Common Stock is not Publicly Traded, the
value of a share of Common Stock as determined by the most recent annual
valuation prepared by an independent expert at the request of the Board of
Directors.
"Major Event" means when (i) the Company enters into one or more definitive
agreements to merge or consolidate the Company with or into another corporation,
or to sell or otherwise dispose of all or substantially all of the Company's
assets, or to effect any other transaction, consolidation or reorganization
having similar results or effect; (ii) any person other than the Company makes a
tender or exchange offer for more than 50% of Common Stock pursuant to which
purchases of any amount of Common Stock are made; or (iii) stock representing
more than 50% of the voting power of the Company is acquired by any person other
than the Company in any one or more transactions occurring in any 24-month
period.
"Option" means any option granted under this Plan.
"Option Agreement" means an agreement, in such form as may be determined by
the Board of Directors or the Committee, executed and delivered by the Company
to the holder of any Option with respect to that option.
"Option Shares" means, with respect to any Option, the maximum number of
shares of Common Stock which may be acquired under the option prior to its
expiration.
"Plan" means the Cytogen Corporation 1999 Directors Stock Option Plan, as
amended.
"Publicly Traded" means, with respect to any class of stock, that the class
of stock is required to be registered under Section 12 of the Securities
Exchange Act of 1934, as amended, or that stock of that class has been sold
within the preceding 12 months in an underwritten public offering.
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"Termination of Service" means the time when a Director ceases to serve as
a Director for any reason, including without limitation by reason of
resignation, retirement, removal, death or Disability.
3. Administration of the Plan.
(a) The Compensation Committee of the Board of Directors will be
responsible for the administration of this Plan. The Committee shall consist of
two or more non-employee directors of the Company who meet the definition of
"outside director" under the provisions of Section 162(m) of the Code and the
definition of "non-employee director" under the provisions of the Exchange Act.
No member of the Committee shall have been within one year prior to appointment
to, or while serving on, the Committee granted or awarded equity securities of
the Company pursuant to this or any other plan of the Company except to the
extent that participation in any such plan or receipt of any such grant or award
would not adversely affect the Committee member's status as a "non-employee
director" or as an "outside director".
(b) The Committee shall (i) determine or provide for the terms and
conditions of the issuance of Compensation Shares, if so authorized by the Board
of Directors, or grant Agreements, and all election and other forms, which terms
and conditions shall not be inconsistent with this Plan, (ii) interpret the Plan
and (iii) make all other decisions relating to the operation of the Plan. The
Committee may adopt such rules or guidelines as it deems appropriate to
implement the Plan. The Committee's determinations under the Plan shall be final
and binding on all persons.
(c) No member of the Board of Directors or of any committee of the Board of
Directors shall be liable for any act or omission of the Board or any committee,
or of any other member of the Board or any committee, or for any act or omission
on his own part, in connection with the administration of this Plan unless it
resulted from the member's own willful misconduct.
4. Persons Eligible to Receive Options and Compensation Shares.
Options and Compensation Shares shall be granted only to Eligible
Directors.
5. Stock Subject to the Plan.
The maximum number of shares of Common Stock as to which Options or
Compensation Shares may be granted or issued under this Plan is 500,000 shares,
subject to adjustment as provided in Section 8. If any Option or Compensation
Share expires or is cancelled, surrendered or forfeited without being exercised
in full (with respect to Options), the number of shares as to which the Option
is not exercised, or Options or Compensation Shares are canceled, surrendered or
forfeited, will once again become shares as to which new Options or Compensation
Shares may be granted. The Common Stock which is issued upon the exercise of
Options or issued as Compensation Shares may be authorized but unissued shares
or shares which have been issued and reacquired by the Company.
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6. Grants of Options or Compensation Shares.
(a) Each person who is newly-elected a director of the Company at an annual
meeting of the stockholders of the Company, such person having not previously
served as a director of the Company and such person then being an Eligible
Director, shall, as of the date of such annual meeting, be granted an Option to
purchase twenty thousand (20,000) shares of Common Stock. In addition, each
person who is appointed a director of the Company after the date of the most
recent annual meeting of the stockholders of the Company, and is an Eligible
Director as of such date, shall be granted on such date an Option to purchase a
pro rata portion of twenty thousand (20,000) shares of Common Stock, based upon
the number of full months remaining from the date of appointment until the one
year anniversary month of such preceding annual meeting.
(b) Effective on approval of the Plan by the shareholders, each person who
is on that date an Eligible Director shall be granted an Option to purchase
twenty one thousand (21,000) shares of Common Stock (the "Initial Option").
(c) Each person who is appointed a director of the Company after the date
of approval of the Plan by the Shareholders and is an Eligible Director as of
such date shall be granted an Option to purchase a pro rata portion of ten
thousand (10,000) shares of Common Stock, based upon the number of full months
remaining from the date of election until the one year anniversary month of the
preceding annual meeting, as of the effective date of their appointment.
(d) On the day following each annual meeting of the stockholders of the
Company, commencing with the 2000 annual meeting, each person who is on that
date an Eligible Director and was re-elected at that meeting shall be granted an
Option to purchase 10,000 shares of Common Stock. In addition, a Chairman of the
Board of Directors, unless the Compensation Committee of the Board determines
otherwise, shall receive an additional grant of fifteen thousand (15,000) shares
of Common Stock.
(e) Eligible Directors shall receive, at the sole discretion of and after
formal action by the Board of Directors, Compensation Shares in such number of
shares of Common Stock that is equal to each respective Eligible Director's Cash
Component compensation divided by the Fair Market Value of the Company's Common
Stock as of the date of issuance of such Compensation Shares, which shall be no
earlier than the date on which the applicable Cash Component compensation
becomes due and payable by the Company, subject to the terms and conditions set
forth herein. Compensation Shares shall not be issued for services not yet
rendered by an Eligible Director to the Company.
(f) Subject to Section 6(e) hereof, Eligible Directors shall receive
Compensation Shares in lieu of the Cash Component of such Eligible Director's
compensation until at least such time as: (i) such Eligible Director owns twenty
thousand (20,000) shares of the Company's Common Stock, excluding options or
other rights to acquire shares of the Company's Common Stock, whether
exercisable or unexercisable; or (ii) if fewer than 20,000 shares are so owned,
such smaller number of shares having a Fair Market Value of in excess of one
hundred thousand dollars ($100,000), excluding the value, if any, of options to
purchase Common Stock, whether exercisable or unexercisable, or other rights to
acquire Common Stock of the Company.
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(g) Upon achieving either of the milestones (i) or (ii) set forth in
Section 6(f) hereof, each such Eligible Director may, at his or her option,
elect to cease receiving his or her Cash Component to which he or she is
entitled in shares of Common Stock under the Plan; provided, however, that such
Eligible Director must make such election by providing notice of such election
to the Company.
(h) Each Option provided for in this Section 6 shall be granted
automatically and without further action by the Company, the Board of Directors
or the Company's stockholders. Promptly after the Date of Grant of each Option
provided for in this Section 6, the Company shall cause an Option Agreement to
be executed and delivered to the holder of the Option. No other Options may be
granted at any time under this Plan.
7. Option and Compensation Shares Provisions.
(a) Exercise Price. The Exercise Price of the Initial Option will be 200%
of the Fair Market Value of the Common Stock on the Date of Grant of the Option.
The Exercise Price of each Option other than the Initial Option will be 100% of
the Fair Market Value of the Common Stock on the Date of Grant of the Option.
The Committee may not reduce the Exercise Price of any Option granted under the
Plan.
(b) Term; Vesting.
(i) No Option granted under this Plan may be exercised more than 10 years
after the Date of Grant of the option.
(ii) Except as provided in Sections 7(b)(iii), 7(f), 7(g) and 7(h), the
Initial Option shall become exercisable in one-third increments
annually on the first, second, and third anniversaries of the Date of
Grant, and Options other than the Initial Option shall become
exercisable in full on the first anniversary of the Date of Grant.
(iii)Upon the occurrence of a Major Event, all of the Option Shares
covered by an Option shall become immediately available for purchase
upon exercise of the option, without regard to the vesting provisions
of Section 7(b)(ii).
(c) Exercise of Options. An Option may be exercised in whole or in part at
any time, or from time to time, during its term. To exercise an Option, the
person exercising the Option must deliver to the Company, at its principal
office:
(i) a notice of exercise of the Option, which states the extent to which
the option is being exercised; and
(ii) payment in full in cash, which may be satisfied by a check, in an
amount equal to the Exercise Price of the option times the number of
shares as to which it is being exercised.
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(d) Delivery of Stock Certificates. As promptly as practicable after an
option is exercised or Compensation Shares become payable to an Eligible
Director, the Company will deliver to the person who exercises the Option or is
owed such Compensation Shares, certificates registered in that person's name
representing the number of shares of Common Stock which were purchased by the
exercise of the option or grant of Compensation Shares in payment for services
rendered. Each certificate may bear a legend to indicate, if applicable, that
the Common Stock represented by the certificate was issued in a transaction
which was not registered under the Securities Act of 1933, as amended, and may
only be sold or transferred in a transaction which is registered under that Act
or is exempt from the registration requirements of that Act.
(e) Nontransferability
(i) Options. During the lifetime of a person to whom an option is issued,
the Option may be exercised only by that person or his or her guardian
or legal representative. An Option may not be assigned, pledged or
hypothecated in any way, will not be subject to execution, and will
not be transferable otherwise than by will or the laws of descent and
distribution. The Company will not recognize any attempt to assign,
transfer, pledge, hypothecate or otherwise dispose of an option
contrary to the provisions of this Plan, or any levy of any attachment
or similar process upon any Option, and, except as expressly stated in
this Plan, the Company will not be required to, and will not, issue
Common Stock on exercise of an option to anyone who claims to have
acquired that option from the person to whom it was granted.
(ii) Compensation Shares. For one year after the date of issuance of
Compensation Shares to any Eligible Director, such Compensation Shares
shall not be transferable by such Eligible Director. During this one
year period, Compensation Shares may not be assigned, pledged or
hypothecated in any way, and will not be transferable otherwise than
by will or the laws of descent and distribution. The Company will not
recognize any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of Compensation Shares contrary to the provisions of
this Plan, or any levy of any attachment or similar process upon any
Compensation Shares, and, except as expressly stated in this Plan, the
Company will not be required to, and will not, remove any related
restrictive legend from the Compensation Shares until such one year
period has expired. The Compensation Shares shall bear a restrictive
legend evidencing such lock-up (the "Lock-up Legend"). Upon the
expiration of such one year lock-up period, Compensation Share s shall
become fully transferable by the holder, subject to the terms of the
Securities Act of 1933, as amended and state securities laws. The
Company shall take reasonable steps to remove the Lock-up Legend from
the Compensation Shares within a reasonable time after the expiration
of such period upon the request of an Eligible Director.
Notwithstanding such lock-up provision, upon the occurrence of a Major
Event, all of the Compensation Shares issued hereunder to Eligible
Directors shall be treated in a like manner as are the outstanding
shares of the Company's Common Stock upon the occurrence of such Major
Event.
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(f) Termination of Service of Director Holding an Option Other Than Because
of Death or Disability. Subject to the provisions of Sections 7(b) and 7(h), if
there is a Termination of Service of a director to whom an Option has been
granted, other than by reason of the director's death or disability, or
retirement, each Option held by the director may be exercised until the earlier
of (x) the end of the three-month period immediately following the date of
Termination of service, or (y) the expiration of the term of the option.
(g) Death or Disability of Director Holding an Option. Notwithstanding the
provisions of Section 7(b), if there is a Termination of Service of a director
to whom an option has been granted by reason of the director's death or
disability, or a former director dies within three months following the date of
his or her Termination of Service, each option held by the Director on the date
of the Director's Termination of Service may be exercised in full (i.e., in
respect of up to 100% of the Option shares, regardless of the time elapsed since
the Date of Grant) until the earlier of (x) the end of the one-year period
immediately following the date of Termination of service or (y) the expiration
of the term of the option. In the event of an Eligible Director's death, all of
such person's outstanding Options will transfer to the maximum extent permitted
by law to such person's designated Beneficiary. Each Eligible Director may name,
from time to time, any beneficiary or beneficiaries (which may be named
contingent ly or successively) as his or her Beneficiary for purposes of this
Plan. Each designation shall be on a form prescribed by the Company, will be
effective only when delivered to the Company and when effective will revoke all
prior designations by the Eligible Director. If an Eligible Director dies with
no such beneficiary designation in effect, such person's Options will be
transferable by will or pursuant to the laws of descent and distribution
applicable to such person.
(h) Retirement or Resignation. If there is a Termination of Service of a
Director by reason of the Director's retirement or resignation at any time after
the Director has reached age 55 with a minimum of three years' service as a
non-employee director, each Option held by the Director on the date of the
Director's Termination of Service may be exercised in full (i.e., in respect of
up to 100% of the Option Shares, regardless of the time elapsed since the Date
of Grant) until the earlier of (x) the end of the five year period immediately
following the date of Termination of Service or (y) the expiration of the term
of the option.
8. Recapitalization, reorganizations, stock splits and the like.
(a) The existence of outstanding Options or Compensation Shares shall not
affect in any way the right or power of the Company or its stockholders to make
or authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Company's capital structure or its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stock ahead of or affecting the Common Stock or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business or any other corporate act
or proceeding, whether of a similar character or otherwise. Except as
hereinafter expressly provided, the issue by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, for cash
or property, or for labor or services either upon direct sale or upon the
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exercise of rights or warrants to subscribe therefor, or on conversion of shares
or obligations o f the Company convertible into such shares or other securities,
shall not affect, and no adjustment by reason thereof shall be made with respect
to, the number, class or price of shares of Common Stock then subject to
outstanding options.
(b) If as a result of any (i) reorganization or liquidation of the Company
or (ii) reclassification of the Company's capital stock, stock splits, stock
splits in the form of dividends, reverse stock splits, or similar
recapitalizations of the Company, or (iii) consolidation or merger of the
Company with or into another corporation, or sale of all or substantially all
the assets of the Company (a reorganization or liquidation of the Company or
reclassification of the Company's capital stock, or a merger, consolidation or
sale of the type described in this subsection being a "Corporate Transaction")
while an Option is outstanding, the holders of the Common Stock become entitled
to receive with respect to their Common Stock, securities or assets other than,
or in addition to, their Common Stock, upon exercise of that Option the holder
will receive what the holder would have owned if the holder had exercised the
Option immediately before the first Corporate Transaction which occurred while
the option was outstan ding and had not disposed of anything the holder would
have received as a result of that and all subsequent Corporate Transactions.
Compensation Shares shall be adjusted in the same manner as the Company's Common
Stock in all events.
9. Rights of Option Holder.
The holder of an Option will not have any rights as a stockholder by reason
of holding that Option. Upon exercise of an Option, the holder will be deemed to
acquire the rights of a stockholder when, but not before, the issuance of Common
Stock as a result of the exercise is recorded in the stock records of the
Company.
10. Laws and Regulations.
The obligation of the Company to sell and deliver shares of Common Stock on
exercise of options or upon the issuance of Compensation Shares will be subject
to the condition that legal counsel for the Company be satisfied that the sale
and delivery will not violate the Securities Act of 1933, as amended, or any
other applicable laws, rules or regulations.
11. Reservation of Shares.
The Company will at all times keep reserved for issuance on exercise of
options a number of authorized but unissued or reacquired shares of Common Stock
equal to the maximum number of shares the Company may be required to issue on
exercise of outstanding options (assuming no subsequent adjustments under
Section 8).
12. Amendment of the Plan.
The Board of Directors may at any time and from time to time modify or
amend this Plan in any respect effective at any date the Board of Directors
determines; provided, that without the approval of the stockholders of the
Company the Board of Directors may not, (i) except as provided in Section 8,
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increase the maximum number of shares of Common Stock which may be issued on
exercise of Options or the payment of Compensation Shares granted under this
Plan; (ii) change the provisions of Section 6 or Section 7; (iii) change the
categories of persons eligible to receive options or Compensation Shares under
this Plan; or (iv) otherwise materially increase (within the meaning of Rule
16b-3 of the Exchange Act) the benefits accruing under this Plan. No
modification or amendment of this Plan will, without the consent of the holder
of an outstanding Option or Compensation Shares, adversely affect the holder's
rights under that Option or with respect to such Compensation Shares.
Notwithstanding approval by shareholde rs, the Board may amend this Plan without
further shareholder approval to add provisions required or enabled by changes to
Rule 16b-3.
13. Termination of the Plan.
This Plan will terminate on June 16, 2009, unless sooner terminated. The
Board of Directors may suspend or terminate this Plan at any time or from time
to time, but no such action may adversely affect the rights of a person holding
an outstanding Option or Compensation Share. The applicable terms of the Plan,
and any terms and conditions as applicable to Options or Compensation Shares
granted prior to such date, shall survive the termination of the Plan and
continue to apply to such Options or Compensation Shares.
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