1
ADAPTEC, INC. EXHIBIT 10.6
1990 DIRECTORS' OPTION PLAN
(as amended August, 1998)
1. Purposes of the Plan. The purposes of this Directors' Option Plan
are to attract and retain the best available personnel for service as Directors
of the Company, to provide additional incentive to the Outside Directors of the
Company to serve as Directors, and to encourage their continued service on the
Board.
All options granted hereunder shall be "non-statutory stock
options".
2. Definitions. As used herein, the following definitions shall
apply:
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the Internal Revenue Code of 1986, as
amended.
(c) "Common Stock" means the Common Stock of the Company.
(d) "Company" means Adaptec, Inc., a Delaware corporation.
(e) "Continuous Status as a Director" means the absence of
any interruption or termination of service as a Director.
(f) "Director" means a member of the Board.
(g) "Employee" means any person, including officers and
Directors, employed by the Company or any Parent or Subsidiary of the Company.
The payment of a Director's fee by the Company shall not be sufficient in and of
itself to constitute "employment" by the Company.
(h) "Exchange Act" means the Securities Exchange Act of 1934,
as amended.
(i) "Fair Market Value" means, as of any date, the value of
Common Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the National
Market System of the National Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ") System, the Fair Market Value of a Share of Common Stock
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported, as quoted on such system or exchange (or the exchange with the
greatest volume of trading in Common Stock) on the last market trading day prior
to the day of
2
determination) as reported in the Wall Street Journal or such other source as
the Board deems reliable;
(ii) If the Common Stock is quoted on the NASDAQ System
(but not on the National Market System thereof) or regularly quoted by a
recognized securities dealer but selling prices are not reported, the Fair
Market Value of a Share of Common Stock shall be the mean between the high and
low asked prices for the Common Stock on the last market trading day prior to
the date of determination, as reported in the Wall Street Journal or such other
source as the Board deems reliable, or;
(iii) In the absence of an established market for the
Common Stock, the Fair Market Value thereof shall be determined in good faith by
the Board.
(j) "Option" means a stock option granted pursuant to the
Plan.
(k) "Optioned Stock" means the Common Stock subject to an
Option.
(l) "Optionee" means an Outside Director who receives an
Option.
(m) "Outside Director" means a Director who is not an
Employee.
(n) "Parent" means a "parent corporation", whether now or
hereafter existing, as defined in Section 425(e) of the Internal Revenue Code of
1986.
(o) "Plan" means this 1990 Directors' Option Plan.
(p) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 10 of the Plan.
(q) "Subsidiary" means a "subsidiary corporation", whether
now or hereafter existing, as defined in Section 424(f) of the Internal Revenue
Code of 1986.
3. Stock Subject to the Plan. Subject to the provisions of Section 10
of the Plan, the maximum aggregate number of Shares which may be optioned and
sold under the Plan is 2,200,000 Shares (the "Pool") of Common Stock. The Shares
may be authorized, but unissued, or reacquired Common Stock.
If an Option should expire or become unexercisable for any
reason without having been exercised in full, the unpurchased Shares which were
subject thereto shall, unless the Plan shall have been terminated, become
available for future grant under the Plan.
-2-
3
4. Administration of and Grants of Options under the Plan.
(a) Administrator. Except as otherwise required herein, the
Plan shall be administered by the Board.
(b) Procedure for Grants. All grants of Options hereunder
shall be automatic and non-discretionary and shall be made strictly in
accordance with the following provisions:
(i) No person shall have any discretion to select which
Outside Directors shall be granted Options or to determine the number of Shares
to be covered by Options granted to Outside Directors.
(ii) Each Outside Director shall be automatically granted
an Option to purchase 40,000 Shares upon the date (on or after the effective
date of this Plan) on which such person first becomes a Director, whether
through election by the stockholders of the Company or appointment by the Board
to fill a vacancy; provided, however, that no Option shall be issued under the
Plan or become exercisable until stockholder approval of the Plan has been
obtained in accordance with Section 16 hereof.
(iii) On March 31, 1997 and on each March 31 thereafter
during the term of this Plan, each Outside Director shall automatically receive
an Option to purchase 15,000 Shares.
(iv) The terms of each Option granted hereunder shall be
as follows:
(A) the term of the Option shall be ten (10) years.
(B) the Option shall be exercisable only while the
Outside Director remains a Director of the Company, except as set forth in
Section 8 hereof.
(C) the exercise price per Share shall be 100% of the
Fair Market Value per Share on the date of grant of the Option.
(D) if granted pursuant to Section 4(b)(ii), the
Option shall become exercisable in installments cumulatively as to twenty-five
percent (25%) of the Optioned Stock on the first anniversary of the date of
grant of the Option and as to six and one-quarter percent (6.25%) of the
remaining Optioned Stock for each full calendar quarter thereafter that the
Optionee remains a Director.
(E) if granted pursuant to Section 4(b)(iii) above,
the Option shall become exercisable in installments cumulatively as to
twenty-five percent (25%) of the Optioned Stock on the last day of each full
calendar quarter after the date of grant, provided that the Optionee remains a
Director as of such date.
-3-
4
(v) In the event that any Option granted under the Plan
would cause the number of Shares subject to outstanding Options plus the number
of Shares previously purchased upon exercise of Options to exceed the Pool, then
each such automatic grant shall be for that number of Shares determined by
dividing the total number of Shares remaining available for grant by the number
of Outside Directors on the automatic grant date. No further grants shall be
made until such time, if any, as additional Shares become available for grant
under the Plan through action of the stockholders to increase the number of
Shares which may be issued under the Plan or through cancellation or expiration
of Options previously granted hereunder.
(c) Powers of the Board. Subject to the provisions and
restrictions of the Plan, the Board shall have the authority, in its discretion:
(i) to determine, upon review of relevant information and in accordance with
Section 2(i) of the Plan, the Fair Market Value of the Common Stock; (ii) to
interpret the Plan; (iii) to prescribe, amend and rescind rules and regulations
relating to the Plan; (iv) to authorize any person to execute on behalf of the
Company any instrument required to effectuate the grant of an Option previously
granted hereunder; and (v) to make all other determinations deemed necessary or
advisable for the administration of the Plan.
(d) Effect of Board's Decision. All decisions, determinations
and interpretations of the Board shall be final.
(e) Suspension or Termination of Option. If the President of
the Company or his designee reasonably believes that an Optionee has committed
an act of misconduct, the President may suspend the Optionee's right to exercise
any Option pending a determination by the Board (excluding the Outside Director
accused of such misconduct). If the Board (excluding the Outside Director
accused of such misconduct) determines an Optionee has committed an act of
embezzlement, fraud, dishonesty, nonpayment of an obligation owed to the
Company, breach of fiduciary duty or deliberate disregard of the Company rules
resulting in loss, damage or injury to the Company, or if an Optionee makes an
unauthorized disclosure of any Company trade secret or confidential information,
engages in any conduct constituting unfair competition, induces any Company
customer to breach a contract with the Company or induces any principal for whom
the Company acts as agent to terminate such agency relationship, neither the
Optionee nor his estate shall be entitled to exercise any Option whatsoever. In
making such determination, the Board (excluding the Outside Director accused of
such misconduct) shall act fairly and shall give the Optionee an opportunity to
appear and present evidence on Optionee's behalf at a hearing before the Board
or a committee of the Board.
5. Eligibility. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth in
Section 4(b) hereof. An Outside Director who has been granted an Option may, if
he is otherwise eligible, be granted an additional Option or Options in
accordance with such provisions.
-4-
5
The Plan shall not confer upon any Optionee any right with
respect to continuation of service as a Director or nomination to serve as a
Director, nor shall it interfere in any way with any rights which the Director
or the Company may have to terminate his directorship at any time.
6. Term of Plan. The Plan shall become effective upon the earlier to
occur of its adoption by the Board or its approval by the stockholders of the
Company as described in Section 16 of the Plan. It shall continue in effect for
a term of ten (10) years unless sooner terminated under Section 11 of the Plan.
7. Exercise Price and Consideration.
(a) Exercise Price. The per Share exercise price for Optioned
Stock shall be 100% of the Fair Market Value per Share on the date of grant of
the Option.
(b) Form of Consideration. The consideration to be paid for
the Shares to be issued upon exercise of an Option, including the method of
payment, shall be determined by the Board and may consist entirely of (i) cash,
(ii) check, (iii) promissory note, (iv) other shares which (x) in the case of
Shares acquired upon exercise of an Option either have been owned by the
Optionee for more than six (6) months on the date of surrender or were not
acquired, directly or indirectly, from the Company, and (y) have a Fair Market
Value on the date of surrender equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised, (v) delivery of a properly
executed exercise notice together with irrevocable instructions to a broker to
promptly deliver to the Company the amount of sale or loan proceeds required to
pay the exercise price, (vi) by delivering an irrevocable subscription agreement
for the Shares which irrevocably obligates the Optionee to take and pay for the
Shares not more than twelve (12) months after the date of delivery of the
subscription agreement, (vii) any combination of the foregoing methods of
payment, or (viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted under applicable law.
8. Exercise of Option.
(a) Procedure for Exercise; Rights as a Stockholder. Any
Option granted hereunder shall be exercisable at such times as are set forth in
Section 4(b) hereof; provided, however, that no Options shall be exercisable
until stockholder approval of the Plan in accordance with Section 16 hereof has
been obtained.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice
of such exercise has been given to the Company in accordance with the terms of
the Option by the person entitled to exercise the Option and full payment for
the Shares with respect to which the Option is exercised has been received by
the Company. Full payment may consist of any consideration and method of payment
allowable under Section 7(b) of the Plan. Until the issuance (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the
-5-
6
Company) of the stock certificate evidencing such Shares, no right to vote or
receive dividends or any other rights as a stockholder shall exist with respect
to the Optioned Stock, notwithstanding the exercise of the Option. A share
certificate for the number of Shares so acquired shall be issued to the Optionee
as soon as practicable after exercise of the Option. No adjustment will be made
for a dividend or other right for which the record date is prior to the date the
stock certificate is issued, except as provided in Section 10 of the Plan.
Exercise of an Option in any manner shall result in a
decrease in the number of Shares which thereafter may be available, both for
purposes of the Plan and for sale under the Option, by the number of Shares as
to which the Option is exercised.
(b) Termination of Status as a Director. If an Outside
Director ceases to serve as a Director, he may, but only within three (3) months
after the date he ceases to be a Director of the Company, exercise his Option to
the extent that he was entitled to exercise it at the date of such termination.
Notwithstanding the foregoing, in no event may the Option be exercised after its
term has expired. To the extent that he was not entitled to exercise an Option
at the date of such termination, or if he does not exercise such Option (which
he was entitled to exercise) within the time specified herein, the Option shall
terminate.
(c) Disability of Optionee. Notwithstanding the provisions of
Section 8(b) above, in the event an Optionee is unable to continue his service
as a Director as a result of his total and permanent disability (as defined in
Section 22(e)(3) of the Code), he may, but only within six (6) months from the
date of termination, exercise his Option to the extent he was entitled to
exercise it at the date of such termination. Notwithstanding the foregoing, in
no event may the Option be exercised after its term has expired. To the extent
that he was not entitled to exercise the Option at the date of termination, or
if he does not exercise such Option (which he was entitled to exercise) within
the time specified herein, the Option shall terminate.
(d) Death of Optionee. In the event of the death of an
Optionee, the Option may be exercised, at any time within six (6) months
following the date of death, by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to
the extent of the right to exercise that had accrued at the date of death.
Notwithstanding the foregoing, in no event may the option be exercised after its
term has expired.
9. Non-Transferability of Options. Unless determined otherwise by the
Board, the Option may not be sold, pledged, assigned, hypothecated, transferred,
or disposed of in any manner other than by will or by the laws of descent or
distribution and may be exercised, during the lifetime of the Optionee, only by
the Optionee. If the Administrator makes an Option or Right transferable, such
Option or Right shall contain such additional terms and conditions as the
Administrator deems appropriate.
10. Adjustments Upon Changes in Capitalization or Merger.
-6-
7
(a) Subject to any required action by the stockholders of the
Company, the number of Shares covered by each outstanding Option, and the number
of Shares which have been authorized for issuance under the Plan but as to which
no Options have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Option, as well as the price per Share covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued Shares resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the aggregate number of
issued Shares effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been "effected without receipt of consideration."
Such adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of Shares of stock of any class, or securities
convertible into Shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of Shares
subject to an Option.
In the event of the proposed dissolution or liquidation of
the Company, all outstanding Options will terminate immediately prior to the
consummation of such proposed action, unless otherwise provided by the Board.
The Board may, in the exercise of its sole discretion in such instances, declare
that any Option shall terminate as of a date fixed by the Board and give each
Optionee the right to exercise his Option as to all or any part of the Optioned
Stock, including Shares as to which the Option would not otherwise be
exercisable.
(b) In the event of a "Change in Control" of the Company, as
defined in paragraph (c) below, any Options outstanding upon the date of such
Change in Control that are not yet exercisable and vested on such date shall
become one hundred percent (100%) exercisable and vested.
(c) Definition of "Change in Control". For purposes of this
Section 10, a "Change in Control" means the occurrence of any of the following:
(i) When any "person," as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act (other than the
Company, a Subsidiary or a Company employee benefit plan, including
any trustee of such plan acting as trustee) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing
fifty percent (50%) or more of the combined voting power of the
Company's then outstanding securities; or
(ii) A change in the composition of the Board occurring
within a two-year period, as a result of which fewer than a majority
of the directors are Incumbent Directors. "Incumbent Directors" shall
mean directors who either (A) are directors of the Company as of the
date hereof, or (B) are elected, or nominated for election, to the
Board with the affirmative votes of at least a majority of the
Incumbent Directors at the time of such election or nomination (but
shall not include an individual whose election or nomination is in
-7-
8
connection with an actual or threatened proxy contest relating to the
election of directors to the Company);
(iii) The consummation of a merger or consolidation of the
Company with any other corporation, other than a merger or
consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least fifty percent (50%) of
the total voting power represented by the voting securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation; or
(iv) The consummation of the sale or disposition by the
Company of all or substantially all the Company's assets.
(d) Golden Parachute Excise Tax Vesting Acceleration
Limitation. Notwithstanding any other provision of this Plan, in the event that
the vesting acceleration provided for in this Plan or amounts or benefits
otherwise payable to an Optionee (i) constitute "parachute payments" within the
meaning of Section 280G of the Code, and (ii) but for this Section 10(d), would
be subject to the excise tax imposed by Section 4999 of the Code (the "Excise
Tax"), then the Optionee's accelerated vesting hereunder shall be either
(i) made in full, or
(ii) made as to such lesser extent as would result in no
portion of such acceleration, amounts or benefits being subject to
the Excise Tax,
whichever of the foregoing amounts, taking into account the applicable federal,
state and local income taxes and the Excise Tax, results in the receipt by the
Optionee on an after-tax basis, of the greatest amount of severance benefits,
notwithstanding that all or some portion of such severance benefits may be
taxable under Section 4999 of the Code. Unless the Company and the Optionee
otherwise agree in writing, any determination required under this Section 10(d)
shall be made in writing in good faith by the accounting firm serving as the
Company's independent public accountants immediately prior to the Change of
Control (the "Accountants"). In the event of a reduction in benefits hereunder,
the Optionee shall be given the choice of which benefits to reduce. For purposes
of making the calculations required by this Section 10(d), the Accountants may
make reasonable assumptions and approximations concerning applicable taxes and
may rely on reasonable, good faith interpretations concerning the application of
Sections 280G and 4999 of the Code. The Company and the Optionee shall furnish
to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section. The
Company shall bear all costs the Accountants may reasonably incur in connection
with any calculations contemplated by this Section 10(d).
-8-
9
11. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time
amend, alter, suspend, or discontinue the Plan, but no amendment, alteration,
suspension, or discontinuation shall be made which would impair the rights of
any Optionee under any grant theretofore made, without his or her consent. In
addition, to the extent necessary and desirable to comply with any other
applicable law or regulation, the Company shall obtain shareholder approval of
any Plan amendment in such a manner and to such a degree as required.
(b) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated.
12. Time of Granting Options. The date of grant of an Option shall,
for all purposes, be the date determined in accordance with Section 4(b) hereof.
Notice of the determination shall be given to each Outside Director to whom an
Option is so granted within a reasonable time after the date of such grant.
13. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of 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 Exchange Act, the rules and regulations promulgated
thereunder, state securities laws, and the requirements of any stock exchange
upon which the Shares may then be listed, 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 Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares, if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.
Inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been
obtained.
14. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
-9-
10
15. Option Agreement. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
16. Stockholder Approval. Continuance of the Plan shall be subject to
approval by the stockholders of the Company at or prior to the first annual
meeting of stockholders held subsequent to the granting of an Option hereunder.
Such stockholder approval shall be obtained in the degree and manner required
under applicable state and federal law.
-10-
11
ADAPTEC, INC.
DIRECTOR'S OPTION AGREEMENT
(Initial Option)
Adaptec, Inc., a Delaware corporation (the "Company"), has granted to
____________________________________________ (the "Optionee"), an option to
purchase a total of 40,000 shares of the Company's Common Stock (the "Optioned
Stock"), at the price determined as provided herein, and in all respects subject
to the terms, definitions and provisions of the 1990 Directors' Option Plan (the
"Plan") adopted by the Company which is incorporated herein by reference. The
terms defined in the Plan shall have the same defined meanings herein.
1. Nature of the Option. This Option is a nonstatutory option and is not
intended to qualify for any special tax benefits to the Optionee.
2. Exercise Price. The exercise price is $_____________ for each share
of Common Stock, which is 100% of the fair market value of the Common
Stock as determined on the date of grant of this Option.
3. Exercise of Option. This Option shall be exercisable during its term
in accordance with the provisions of Section 8 of the Plan as
follows:
(a) Right to Exercise.
(i) This Option shall become exercisable cumulatively
as to twenty-five percent (25%) of the Optioned
Stock on the first anniversary of the date of the
grant and as to six and one-quarter percent
(6.25%) of the remaining Optioned Stock for each
full quarter thereafter that the Optionee remains
a Director; provided, however, that in no event
shall this Option be exercisable until
stockholder approval of the Plan has been
obtained in accordance with Section 16 thereof.
(ii) This Option may not be exercised for a fraction
of a share.
(iii) In the event of Optionee's death, disability or
other termination of service as a Director, the
exercisability of the Option is governed by
Sections 6, 7 and 8 of this Agreement.
(b) Method of Exercise. This Option shall be exercisable by
written notice which shall state the election to exercise
the Option, the number of Shares in respect of which the
Option is being exercised, and such other representations
and agreements
-1-
12
as to the holder's investment intent with respect to such
Shares of Common Stock as may be required by the Company
pursuant to the provisions of the Plan. Such written
notice shall be signed by the Optionee and shall be
delivered in person or by certified mail to the Secretary
of the Company. The written notice shall be accompanied by
payment of the exercise price.
4. Method of Payment. Payment of the exercise price shall be by any
of the following, or a combination thereof, at the election of the
Optionee:
(a) cash;
(b) check; or
(c) surrender of other Shares of Common Stock of the Company
which (A) either have been owned by the Optionee for more
than six (6) months on the date of surrender or were not
acquired, directly or indirectly, from the Company, and
(B) have a fair market value on the date of surrender
equal to the exercise price of the Shares as to which the
Option is being exercised.
5. Restrictions on Exercise. This Option may not be exercised if the
issuance of such Shares upon such exercise or the method of payment
of consideration for such shares would constitute a violation of any
applicable federal or state securities or other law or regulations,
or if such issuance would not comply with the requirements of any
stock exchange upon which the Shares may then be listed. As a
condition to the exercise of this Option, the Company may require
Optionee to make any representation and warranty to the Company as
may be required by any applicable law or regulation.
6. Termination of Status as a Director. If Optionee ceases to serve
as a Director, he may, but only within three (3) months after the
date he ceases to be a Director of the Company, exercise this Option
to the extent that he was entitled to exercise it at the date of such
termination. Notwithstanding the foregoing, in no event may the
Option be exercised after the ten (10) year term has expired. To the
extent that he was not entitled to exercise this Option at the date
of such termination, or if he does not exercise this Option within
the time specified herein, the Option shall terminate.
7. Disability of Optionee. Notwithstanding the provisions of Section
6 above, if Optionee is unable to continue his service as a Director
as a result of his total and permanent disability (as defined in
Section 22(e)(3) of the Internal Revenue Code), he may, but only
within six (6) months from the date of termination, exercise this
Option to the extent he was entitled to exercise it at the date of
such termination. To the extent that he was not entitled to exercise
this Option at the date of termination, or if he does not exercise
this Option within the time specified herein, the Option shall
terminate.
-2-
13
8. Death of Optionee. In the event of the death of Optionee, the
Option may be exercised, at any time within six (6) months following
the date of death, by Optionee's estate or by a person who acquired
the right to exercise the Option by bequest or inheritance, but only
to the extent of the right to exercise that had accrued at the date
of death.
9. Non-Transferability of Option. This Option may not be transferred
in any manner otherwise than by will or by the laws of descent or
distribution and may be exercised during the lifetime of Optionee
only by him. The terms of this Option shall be binding upon the
executors, administrators, heirs, successors and assigns of the
Optionee.
10. Term of Option. This Option may not be exercised more than ten
(10) years from the date of grant of this Option, and may be
exercised during such term only in accordance with the Plan and the
terms of this Option.
11. Taxation Upon Exercise of Option. Optionee understands that, upon
exercise of this Option, he will recognize income for tax purposes in
an amount equal to the excess of the then fair market value of the
Shares purchased over the exercise price paid for such Shares. (Since
the Optionee is subject to Section 16(b) of the Securities Exchange
Act of 1934, as amended, the measurement and timing of such income
may be deferred, and the Optionee is advised to contact a tax advisor
concerning the desirability of filing an 83(b) election in connection
with the exercise of the Option.) Upon a resale of such Shares by the
Optionee, any difference between the sale price and the fair market
value of the Shares on the date of exercise of the Option will be
treated as capital gain or loss.
DATE OF GRANT: _________________
ADAPTEC, INC.,
a Delaware corporation
By:______________________________________
President
-3-
14
Optionee acknowledges receipt of a copy of the Plan, a copy of which
is annexed hereto, and represents that he is familiar with the terms and
provisions thereof, and hereby accepts this Option subject to all of the terms
and provisions thereof. Optionee hereby agrees to accept as binding, conclusive
and final all decisions or interpretations of the Board upon any questions
arising under the Plan.
Dated: _________________
_______________________________________
Optionee
-4-
15
ADAPTEC, INC.
DIRECTOR'S OPTION AGREEMENT
(Annual Option)
Adaptec, Inc., a Delaware corporation (the "Company"), has granted to
_________________________________________ (the "Optionee"), an option to
purchase a total of 15,000 shares of the Company's Common Stock (the "Optioned
Stock"), at the price determined as provided herein, and in all respects subject
to the terms, definitions and provisions of the 1990 Directors' Option Plan (the
"Plan") adopted by the Company which is incorporated herein by reference. The
terms defined in the Plan shall have the same defined meanings herein.
1. Nature of the Option. This Option is a nonstatutory option and is
not intended to qualify for any special tax benefits to the Optionee.
2. Exercise Price. The exercise price is $_____________ for each
share of Common Stock, which is 100% of the fair market value of the
Common Stock as determined on the date of grant of this Option.
3. Exercise of Option. This Option shall be exercisable during its
term in accordance with the provisions of Section 8 of the Plan as
follows:
(a) Right to Exercise.
(i) This Option shall become exercisable
cumulatively as to twenty-five percent (25%) of
the Optioned Stock for each full quarter after
the date of grant that the Optionee remains a
Director; provided, however, that in no event
shall this Option be exercisable until
stockholder approval of the Plan has been
obtained in accordance with Section 16 thereof.
(ii) This Option may not be exercised for a fraction
of a share.
(iii) In the event of Optionee's death, disability or
other termination of service as a Director, the
exercisability of the Option is governed by
Sections 6, 7 and 8 of this Agreement.
-1-
16
(b) Method of Exercise. This Option shall be exercisable by
written notice which shall state the election to exercise
the Option, the number of Shares in respect of which the
Option is being exercised, and such other representations
and agreements as to the holder's investment intent with
respect to such Shares of Common Stock as may be required
by the Company pursuant to the provisions of the Plan. Such
written notice shall be signed by the Optionee and shall be
delivered in person or by certified mail to the Secretary
of the Company. The written notice shall be accompanied by
payment of the exercise price.
4. Method of Payment. Payment of the exercise price shall be by any
of the following, or a combination thereof, at the election of the
Optionee:
(a) cash;
(b) check; or
(c) surrender of other Shares of Common Stock of the Company
which (A) either have been owned by the Optionee for more
than six (6) months on the date of surrender or were not
acquired, directly or indirectly, from the Company, and
(B) have a fair market value on the date of surrender
equal to the exercise price of the Shares as to which the
Option is being exercised.
5. Restrictions on Exercise. This Option may not be exercised if the
issuance of such Shares upon such exercise or the method of payment
of consideration for such shares would constitute a violation of any
applicable federal or state securities or other law or regulations,
or if such issuance would not comply with the requirements of any
stock exchange upon which the Shares may then be listed. As a
condition to the exercise of this Option, the Company may require
Optionee to make any representation and warranty to the Company as
may be required by any applicable law or regulation.
6. Termination of Status as a Director. If Optionee ceases to serve
as a Director, he may, but only within three (3) months after the
date he ceases to be a Director of the Company, exercise this Option
to the extent that he was entitled to exercise it at the date of such
termination. Notwithstanding the foregoing, in no event may the
Option be exercised after its ten (10) year term has expired. To the
extent that he was not entitled to exercise this Option at the date
of such termination, or if he does not exercise this Option within
the time specified herein, the Option shall terminate.
-2-
17
7. Disability of Optionee. Notwithstanding the provisions of Section
6 above, if Optionee is unable to continue his service as a Director
as a result of his total and permanent disability (as defined in
Section 22(e)(3) of the Internal Revenue Code), he may, but only
within six (6) months from the date of termination, exercise this
Option to the extent he was entitled to exercise it at the date of
such termination. To the extent that he was not entitled to exercise
this Option at the date of termination, or if he does not exercise
this Option within the time specified herein, the Option shall
terminate.
8. Death of Optionee. In the event of the death of Optionee, the
Option may be exercised, at any time within six (6) months following
the date of death, by Optionee's estate or by a person who acquired
the right to exercise the Option by bequest or inheritance, but only
to the extent of the right to exercise that had accrued at the date
of death.
9. Non-Transferability of Option. This Option may not be transferred
in any manner otherwise than by will or by the laws of descent or
distribution and may be exercised during the lifetime of Optionee
only by him. The terms of this Option shall be binding upon the
executors, administrators, heirs, successors and assigns of the
Optionee.
10. Term of Option. This Option may not be exercised more than ten
(10) years from the date of grant of this Option, and may be
exercised during such term only in accordance with the Plan and the
terms of this Option.
11. Taxation Upon Exercise of Option. Optionee understands that,
upon exercise of this Option, he will recognize income for tax
purposes in an amount equal to the excess of the then fair market
value of the Shares purchased over the exercise price paid for such
Shares. (Since the Optionee is subject to Section 16(b) of the
Securities Exchange Act of 1934, as amended, the measurement and
timing of such income may be deferred, and the Optionee is advised to
contact a tax advisor concerning the desirability of filing an 83(b)
election in connection with the exercise of the Option.) Upon a
resale of such Shares by the Optionee, any difference between the
sale price and the fair market value of the Shares on the date of
exercise of the Option will be treated as capital gain or loss.
DATE OF GRANT: ______________
ADAPTEC, INC.,
a Delaware corporation
By:_____________________________________
-3-
18
President
-4-
19
Optionee acknowledges receipt of a copy of the Plan, a copy of which
is annexed hereto, and represents that he is familiar with the terms and
provisions thereof, and hereby accepts this Option subject to all of the terms
and provisions thereof. Optionee hereby agrees to accept as binding, conclusive
and final all decisions or interpretations of the Board upon any questions
arising under the Plan.
Dated: _________________
__________________________
Optionee
-5-