TECHNE CORPORATION
1997 INCENTIVE STOCK OPTION PLAN
SECTION 1.
DEFINITIONS
As used herein, the following terms shall have the meanings indicated
below:
(a) "Committee" shall mean a Committee of two or more directors who shall
be appointed by and serve at the pleasure of the Board. As long as the
Company's securities are registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended, then, to the extent necessary
for compliance with Rule 16b-3, or any successor provision, each of the
members of the Committee shall be a "Non-Employee Director."
(b) The "Company" shall mean Techne Corporation, a Minnesota corporation.
(c) "Fair Market Value" shall mean (i) if such stock is reported by the
Nasdaq National Market or Nasdaq SmallCap Market or is listed upon an
established stock exchange or exchanges, the reported closing price of such
stock by the Nasdaq National Market or Nasdaq SmallCap Market or on such
stock exchange or exchanges on the date the option is granted or, if no
sale of such stock shall have occurred on that date, on the next preceding
day on which there was a sale of stock; (ii) if such stock is not so
reported by the Nasdaq National Market or Nasdaq SmallCap Market or listed
upon an established stock exchange, the average of the closing "bid" and
"asked" prices quoted by the National Quotation Bureau, Inc. (or any
comparable reporting service) on the date the option is granted, or if
there are no quoted "bid" and "asked" prices on such date, on the next
preceding date for which there are such quotes; or (iii) if such stock is
not publicly traded as of the date the option is granted, the per share
value as determined by the Board, or the Committee, in its sole discretion
by applying principles of valuation with respect to all such options.
(d) The "Internal Revenue Code" is the Internal Revenue Code of 1986, as
amended from time to time.
(e) "Non-Employee Director" for purposes of this Plan shall have the same
meaning as set forth in Rule 16b-3, or any successor provision, as then in
effect, of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended.
(f) "Option Stock" shall mean Common Stock of the Company (subject to
adjustment as described in Section 11) reserved for options pursuant to
this Plan.
(g) "Parent" shall mean any corporation which owns, directly or indirectly
in an unbroken chain, fifty percent (50%) or more of the total voting power
of the Company's outstanding stock.
(h) The "Plan" means the Techne Corporation 1997 Incentive Stock Option
Plan, as amended hereafter from time to time, including the form of Option
Agreements as they may be modified by the Board from time to time.
(i) A "Subsidiary" shall mean any corporation of which fifty percent (50%)
or more of the total voting power of outstanding stock is owned, directly
or indirectly in an unbroken chain, by the Company.
SECTION 2.
PURPOSE
The purpose of the Plan is to promote the success of the Company and
its Subsidiaries by facilitating the retention of competent personnel and
by furnishing incentive to employees upon whose efforts the success of the
Company and its Subsidiaries will depend to a large degree. It is the
intention of the Company to carry out the Plan through the granting of
stock options which will qualify as "incentive stock options" under the
provisions of Section 422 of the Internal Revenue Code, or any successor
provision, pursuant to Section 9 of this Plan. Any options granted after
adoption of the Plan by the Board of Directors shall be treated as
nonqualified stock options if shareholder approval is not obtained within
twelve months after the adoption of the Plan by the Board. The
Administrator may provide for the continuation of options originally
granted as incentive stock options as nonqualified stock options, under
such circumstances, including a change in control of the Company, as the
Administrator shall determine.
SECTION 3.
EFFECTIVE DATE OF PLAN
The Plan shall be effective as of the date of adoption by the Board of
Directors, subject to approval by the shareholders of the Company as
required in Section 2.
SECTION 4.
ADMINISTRATION
The Plan shall be administered by the Board of Directors of the
Company (hereinafter referred to as the "Board") or by a Committee which
may be appointed by the Board from time to time (collectively referred to
as the "Administrator"). The Administrator shall have all of the powers
vested in it under the provisions of the Plan, including but not limited to
exclusive authority (where applicable and within the limitations described
herein) to determine, in its sole discretion, whether an option shall be
granted, the individuals to whom, and the time or times at which, options
shall be granted, the number of shares subject to each option and the
option price and terms and conditions of each option. The Administrator
shall have full power and authority to administer and interpret the Plan,
to make and amend rules, regulations and guidelines for administering the
Plan, to prescribe the form and conditions of the respective stock option
agreements (which may vary from Optionee to Optionee) evidencing each
option and to make all other determinations necessary or advisable for the
administration of the Plan. The Administrator's interpretation of the
Plan, and all actions taken and determinations made by the Administrator
pursuant to the power vested in it hereunder, shall be conclusive and
binding on all parties concerned. Notwithstanding anything in the Plan to
the contrary, an Optionee shall not, in any calendar year, be granted
options which, in total, provide for the purchase of more than 200,000
shares of Option Stock.
No member of the Board or the Committee shall be liable for any action
taken or determination made in good faith in connection with the
administration of the Plan. In the event the Board appoints a Committee as
provided hereunder, any action of the Committee with respect to the
administration of the Plan shall be taken pursuant to a majority vote of
the Committee members or pursuant to the written resolution of all
Committee members.
SECTION 5.
PARTICIPANTS
The Administrator shall, from time to time, at its discretion and
without approval of the shareholders, designate those employees of the
Company or any Subsidiary to whom options shall be granted under this Plan.
The Administrator may grant additional options under this Plan to some or
all participants then holding options or may grant options solely or
partially to new participants. In designating participants, the
Administrator shall also determine the number of shares to be optioned to
each such participant. The Board may from time to time designate
individuals as being ineligible to participate in the Plan.
SECTION 6.
STOCK
The Stock to be optioned under this Plan shall consist of authorized
but unissued shares of Option Stock. Three hundred thousand (300,000)
shares of Option Stock shall be reserved and available for options under
the Plan; provided, however, that the total number of shares of Option
Stock reserved for options under this Plan shall be subject to adjustment
as provided in Section 11 of the Plan. In the event that any outstanding
option under the Plan for any reason expires or is terminated prior to the
exercise thereof, the shares of Option Stock allocable to the unexercised
portion of such option shall continue to be reserved for options under the
Plan and may be optioned hereunder.
SECTION 7.
DURATION OF PLAN
Options may be granted pursuant to the Plan from time to time during a
period of ten (10) years from the effective date as defined in Section 3.
Any option granted during such ten-year period shall remain in full force
and effect until the expiration of the option as specified in the written
stock option agreement and shall remain subject to the terms and conditions
of this Plan.
SECTION 8.
PAYMENT
Optionees may pay for shares upon exercise of options granted pursuant
to this Plan with cash, personal check, certified check or, if approved by
the Administrator in its sole discretion, Common Stock of the Company
valued at such Stock's then Fair Market Value, or such other form of
payment as may be authorized by the Administrator. The Administrator may,
in its sole discretion, limit the forms of payment available to the
Optionee and may exercise such discretion any time prior to the termination
of the option granted to the Optionee or upon any exercise of the option by
the Optionee.
With respect to payment in the form of Common Stock of the Company,
the Administrator may require advance approval or adopt such rules as it
deems necessary to assure compliance with Rule 16b-3, or any successor
provision, as then in effect, of the General Rules and Regulations under
the Securities Exchange Act of 1934, if applicable.
SECTION 9.
TERMS AND CONDITIONS OF OPTIONS
Each option granted pursuant to this Section 9 shall be evidenced by a
written stock option agreement (the "Option Agreement"). The Option
Agreement shall be in such form as may be approved from time to time by the
Administrator and may vary from Optionee to Optionee; provided, however,
that each Optionee and each Option Agreement shall comply with and be
subject to the following terms and conditions:
(a) Number of Shares and Option Price. The Option Agreement shall
state the total number of shares covered by the option. To the extent
required to qualify the Option as an incentive stock option under
Section 422 of the Internal Revenue Code, or any successor provision,
the option price per share shall not be less than one hundred percent
(100%) of the Fair Market Value of the Common Stock per share on the
date the Administrator grants the option; provided, however, that if
an Optionee owns stock possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or
of its Parent or any Subsidiary, the option price per share of an
incentive stock option granted to such Optionee shall not be less than
one hundred ten percent (110%) of the Fair Market Value of the Common
Stock per share on the date of the grant of the option. The
Administrator shall have full authority and discretion in establishing
the option price and shall be fully protected in so doing.
(b) Term and Exercisability of Option. The term during which any
option granted under the Plan may be exercised shall be established in
each case by the Administrator. To the extent required to qualify the
Option as an incentive stock option under Section 422 of the Internal
Revenue Code, or any successor provision, in no event shall any
incentive stock option be exercisable during a term of more than ten
(10) years after the date on which it is granted; provided, however,
that if an Optionee owns stock possessing more than ten percent (10%)
of the total combined voting power of all classes of stock of the
Company or of its parent or any Subsidiary, the incentive stock option
granted to such Optionee shall be exercisable during a term of not
more than five (5) years after the date on which it is granted.
The Option Agreement shall state when the option becomes exercisable
and shall also state the maximum term during which the option may be
exercised. In the event an option is exercisable immediately, the
manner of exercise of the option in the event it is not exercised in
full immediately shall be specified in the Option Agreement. The
Administrator may accelerate the exercisability of any option granted
hereunder which is not immediately exercisable as of the date of
grant.
(c) Other Provisions. The Option Agreement authorized under this
Section 9 shall contain such other provisions as the Administrator
shall deem advisable.
SECTION 10.
TRANSFER OF OPTION
No option granted under this Plan shall be transferable, in whole or
in part, by the Optionee other than by will or by the laws of descent and
distribution and, during the Optionee's lifetime, the option may be
exercised only by the Optionee. If the Optionee shall attempt any transfer
of any option granted under this Plan during the Optionee's lifetime, such
transfer shall be void and the option, to the extent not fully exercised,
shall terminate.
SECTION 11.
RECAPITALIZATION, SALE, MERGER, EXCHANGE
OR LIQUIDATION
In the event of an increase or decrease in the number of shares of
Common Stock resulting from a subdivision or consolidation of shares or the
payment of a stock dividend or any other increase or decrease in the number
of shares of Common Stock effected without receipt of consideration by the
Company, the number of shares of Option Stock reserved under Section 6
hereof and the number of shares of Option Stock covered by each outstanding
option and the price per share thereof shall be adjusted by the Board to
reflect such change. Additional shares which may be credited pursuant to
such adjustment shall be subject to the same restrictions as are applicable
to the shares with respect to which the adjustment relates.
Unless otherwise provided in the stock option agreement, in the event
of an acquisition of the Company through the sale of substantially all of
the Company's assets and the consequent discontinuance of its business or
through a merger, consolidation, exchange, reorganization,
reclassification, extraordinary dividend, divestiture or liquidation of the
Company (collectively referred to as a "change in control transaction" or
"transaction"), all outstanding options shall become immediately
exercisable, whether or not such options had become exercisable prior to
the transaction; provided, however, that if the acquiring party seeks to
have the transaction accounted for on a "pooling of interests" basis and,
in the opinion of the Company's independent certified public accountants,
accelerating the exercisability of such options would preclude a pooling of
interests under generally accepted accounting principles, the
exercisability of such options shall not accelerate. In addition to the
foregoing, in the event of such a transaction, the Board may provide for
one or more of the following:
(a) the complete termination of this Plan and cancellation of
outstanding options not exercised prior to a date specified by the
Board (which date shall give Optionees a reasonable period of time in
which to exercise the options prior to or simultaneously with the
effectiveness of such transaction);
(b) that Optionees holding outstanding options shall receive, with
respect to each share of Option Stock subject to such options, as of
the effective date of any such transaction, cash in an amount equal to
the excess of the Fair Market Value of such Option Stock on the date
immediately preceding the effective date of such transaction over the
option price per share of such options; provided that the Board may,
in lieu of such cash payment, distribute to such Optionees shares of
stock of the Company or shares of stock of any corporation succeeding
the Company by reason of such transaction, such shares having a value
equal to the cash payment herein; or
(c) the continuance of the Plan with respect to the exercise of
options which were outstanding as of the date of adoption by the Board
of such plan for such transaction and provide to Optionees holding
such options the right to exercise their respective options as to an
equivalent number of shares of stock of the corporation succeeding the
Company by reason of such transaction.
The Board may restrict the rights of or the applicability of this Section
11 to the extent necessary to comply with Section 16(b) of the Securities
Exchange Act of 1934, the Internal Revenue Code or any other applicable law
or regulation. The grant of an option pursuant to the Plan shall not limit
in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge, exchange or consolidate or to dissolve, liquidate,
sell or transfer all or any part of its business or assets.
SECTION 12.
SECURITIES LAW COMPLIANCE
No shares of Common Stock shall be issued pursuant to the Plan unless
and until there has been compliance, in the opinion of Company's counsel,
with all applicable legal requirements, including without limitation, those
relating to securities laws and stock exchange listing requirements. As a
condition to the issuance of Option Stock to Optionee, the Administrator
may require Optionee (i) in the absence of an effective registration
statement under the Securities Act of 1933, to represent that the shares of
Option Stock are being acquired for investment and not resale and to make
such other representations as the Administrator shall deem necessary or
appropriate to qualify the issuance of the shares as exempt from the
Securities Act of 1933 and any other applicable securities laws, and (ii)
to represent that Optionee shall not dispose of the shares of Option Stock
in violation of the Securities Act of 1933 or any other applicable
securities laws.
As a further condition to the grant of any option or the issuance of
Option Stock to Optionee, Optionee agrees to the following:
(a) In the event the Company advises Optionee that it plans an
underwritten public offering of its Common Stock in compliance with
the Securities Act of 1933, as amended, and the underwriter(s) seek to
impose restrictions under which certain shareholders may not sell or
contract to sell or grant any option to buy or otherwise dispose of
part or all of their stock purchase rights of the underlying Common
Stock, Optionee will not, for a period not to exceed 180 days from the
prospectus, sell or contract to sell or grant an option to buy or
otherwise dispose of any option granted to Optionee pursuant to the
Plan or any of the underlying shares of Common Stock without the prior
written consent of the underwriter(s) or its representative(s).
(b) In the event of a transaction (as defined in Section 11 of the
Plan) which is treated as a "pooling of interests" under generally
accepted accounting principles, Optionee will comply with Rule 145 of
the Securities Act of 1933 and any other restrictions imposed under
other applicable legal or accounting principles if Optionee is an
"affiliate" (as defined in such applicable legal and accounting
principles) at the time of the transaction, and Optionee will execute
any documents necessary to ensure compliance with such rules.
The Company reserves the right to place a legend on any stock
certificate issued upon exercise of an option granted pursuant to the Plan
to assure compliance with this Section 12.
SECTION 13.
RIGHTS AS A SHAREHOLDER
An Optionee (or the Optionee's successor or successors) shall have no
rights as a shareholder with respect to any shares covered by an option
until the date of the issuance of a stock certificate evidencing such
shares. No adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property),
distributions or other rights for which the record date is prior to the
date such stock certificate is actually issued (except as otherwise
provided in Section 11 of the Plan).
SECTION 14.
AMENDMENT OF THE PLAN
The Board may from time to time, insofar as permitted by law, suspend
or discontinue the Plan or revise or amend it in any respect; provided,
however, that no such revision or amendment, except as is authorized in
Section 11 or Section 12, shall impair the terms and conditions of any
option which is outstanding on the date of such revision or amendment to
the material detriment of the Optionee without the consent of the Optionee.
Notwithstanding the foregoing, no such revision or amendment shall (i)
materially increase the number of shares subject to the Plan except as
provided in Section 13 hereof, (ii) change the designation of the class of
employees eligible to receive options, (iii) decrease the price at which
options may be granted, or (iv) materially increase the benefits accruing
to Optionees under the Plan without the approval of the shareholders of the
Company if such approval is required for compliance with the requirements
of any applicable law or regulation.
SECTION 15.
NO OBLIGATION TO EXERCISE OPTION
The granting of an option shall impose no obligation upon the Optionee
to exercise such option. Further, the granting of an option hereunder
shall not impose upon the Company or any Subsidiary any obligation to
retain the Optionee in its employ for any period.