Exhibit 10.5
VYYO INC.
2000 EMPLOYEE STOCK PURCHASE PLAN
SECTION 1. GENERAL PURPOSE OF PLAN; DEFINITIONS.
The name of this plan is the Vyyo Inc. 2000 Employee Stock Purchase
Plan (the "Plan"). The Plan was adopted by the Board (defined below) on
February 2, 2000, and approved by the stockholders of the Company (defined
below) on February 2, 2000. The purpose of the Plan is to provide Employees
(defined below) of the Company (defined below), its Parent (defined below)
and any Designated Subsidiary (defined below) with the opportunity to
purchase Common Stock (defined below) through accumulated payroll deductions.
It is the intention of the Company that the Plan qualify as an "employee
stock purchase plan" within the meaning of Section 423 of the Code (defined
below), and that the provisions of the Plan be construed in a manner
consistent with the requirements of such Section of the Code.
For purposes of the Plan, the following terms shall be defined as
set forth below:
a. "ADMINISTRATOR" means the Board, or if and to the extent
the Board does not administer the Plan, the Committee in accordance with
Section 11 below.
b. "BOARD" shall mean the Board of Directors of the Company.
c. "CHANGE IN CAPITALIZATION" shall mean any increase,
reduction, change or exchange of Shares for a different number of shares
and/or kind of shares or other securities of the Company by reason of a
reclassification, recapitalization, merger, consolidation, reorganization,
issuance of warrants or rights, stock dividend, stock split or reverse stock
split, combination or exchange of Shares, repurchase of Shares, change in
corporate structure or otherwise.
d "CODE" shall mean the Internal Revenue Code of 1986, as
amended from time to time, or any successor thereto.
e. "COMMITTEE" shall mean a committee appointed by the Board
to administer the Plan and to perform the functions set forth herein.
f. "COMMON STOCK" shall mean the common stock, $0.0001 par
value, of the Company.
g. "COMPANY" shall mean Vyyo Inc., a Delaware corporation.
h. "COMPENSATION" shall mean the fixed salary or wage paid by
the Company to an Employee as reported by the Company to the United States
government for Federal income tax purposes, including an Employee's portion
of salary deferral contributions pursuant to Section 401(k) of the Code and
any amount excludable pursuant to Section 125 of the Code, but excluding any
payments for overtime, shift premium, incentive compensation, bonuses,
commissions, severance pay, expense reimbursements or any credit or benefit
under any employee plan maintained by the Company.
i. "CONTINUOUS STATUS AS AN EMPLOYEE" shall mean the absence
of any interruption or termination of service as an Employee. Continuous
Status as an Employee shall not be considered interrupted in the case of a
leave of absence agreed to in writing by the Company, its Parent or a
Designated Subsidiary, as appropriate, provided that (x) such leave is for a
period of not more than 90 days or (y) reemployment with the Company, its
Parent or a Designated Subsidiary, as appropriate, is guaranteed by contract
or statute upon expiration of such leave.
j. "DESIGNATED SUBSIDIARY" shall mean a Subsidiary that has
been designated by the Administrator from time to time in its sole discretion
as eligible to participate in the Plan.
k. "EMPLOYEE" shall mean any person who is customarily
employed for at least twenty (20) hours per week and more than five (5)
months in a calendar year by the Company, its Parent or a Designated
Subsidiary.
l. "ENROLLMENT DATE" shall mean the first Trading Day of each
Offering Period.
m. "FAIR MARKET VALUE" as of a particular date shall mean the
fair market value of the Shares as determined by the Administrator in its
sole discretion; PROVIDED, HOWEVER, that (i) if the Shares are admitted to
trading on a national securities exchange, fair market value of the Shares on
any date shall be the closing sale price reported for the Shares on such
exchange on such date or, if no sale was reported on such date, on the last
date preceding such date on which a sale was reported, (ii) if the Shares are
admitted to quotation on the National Association of Securities Dealers
Automated Quotation ("Nasdaq") System or other comparable quotation system
and have been designated as a National Market System ("NMS") security, fair
market value of the Shares on any date shall be the closing sale price
reported for the Shares on such system on such date or, if no sale was
reported on such date, on the last date preceding such date on which a sale
was reported, or (iii) if the Shares are admitted to quotation on the Nasdaq
System but have not been designated as an NMS security, fair market value of
the Shares on
any date shall be the average of the highest bid and lowest asked prices of
the Shares on such system on such date or, if no bid and ask prices were
reported on such date, on the last date preceding such date on which both bid
and ask prices were reported. Notwithstanding anything to the contrary
contained herein, for purposes of the Enrollment Date of the first Offering
Period under the Plan, fair market value of the Shares shall be the initial
price to the public as set forth in the final prospectus included within the
registration statement in Form S-1 filed with the Securities and Exchange
Commission for the initial underwritten public offering of the Stock (the
"Registration Statement").
n. "OFFERING PERIOD" shall mean a period as described in
Section 3 hereof.
o. "PARENT" shall mean any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company if, at
the time of the granting of an option, each of the corporations other than
the Company owns Shares possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other
corporations in such chain, whether or not such corporation now exists or
hereafter acquires the Company.
p. "PARTICIPANT" shall mean an Employee who elects to
participate in the Plan pursuant to Section 4 hereof.
q. "PURCHASE DATE" shall mean the last Trading Day of each
Purchase Period.
r. "PURCHASE PERIOD" shall mean the approximately six-month
period commencing after one Purchase Date and ending with the next Purchase
Date, except that the first Purchase Period of any Offering Period shall
commence on the Enrollment Date.
s. "PURCHASE PRICE" shall mean an amount equal to the lesser
of (i) 85% of the Fair Market Value of a Share on the Enrollment Date or (ii)
85% of the Fair Market Value of Share on the Purchase Date.
t. "SHARE" shall mean a share of Common Stock.
u. "SUBSIDIARY" shall mean any corporation (other than the
Company) in an unbroken chain of corporations, beginning with the Company,
if, at the time of the granting of an option, each of the corporations other
than the last
corporation in the unbroken chain owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain, whether or not such corporation now exists or is
hereafter organized or acquired by the Company or a Subsidiary.
v. "TRADING DAY" shall mean a day on which national stock
exchanges and the Nasdaq System are open for trading.
SECTION 2. ELIGIBILITY.
a. Subject to the limitations set forth in Section 2(b)
hereof, any person who is an Employee as of an Enrollment Date shall be
eligible to participate in the Plan in accordance with Section 4 hereof and
shall be granted an option for the Offering Period commencing on such
Enrollment Date.
b. Notwithstanding any provision of the Plan to the contrary,
no Employee shall be granted an option under the Plan (i) if such Employee
(or any other person whose stock would be attributed to such Employee
pursuant to Section 424(d) of the Code) would own stock and/or hold
outstanding options to purchase stock possessing five percent (5%) or more of
the total combined voting power or value of all classes of stock of the
Company, its Parent or of any Subsidiary, or (ii) if such grant would permit
such Employee's right to purchase stock under all employee stock purchase
plans (described in Section 423 of the Code) of the Company, its Parent and
of any Subsidiary to accrue at a rate that exceeds twenty-five thousand
dollars ($25,000) of Fair Market Value of such stock (determined at the time
such option is granted) for any calendar year in which such option would be
outstanding. Any amounts received from an Employee that cannot be used to
purchase Shares as a result of this limitation shall be returned as soon as
reasonably practicable to the Employee without interest.
SECTION 3. OFFERING PERIODS.
The Plan shall be implemented by a series of consecutive,
overlapping twenty-four month Offering Periods, with a new Offering Period
commencing on the first Trading Day on or after May 15 (beginning in the year
2001) and November 15 (beginning in the year 2000) of each year, or at such
other time or times as may be determined by the Administrator, and ending on
the last Trading Day on or before November 14 and May 14, respectively,
occurring twenty-four months later or at such other time or times as may be
determined by the Administrator; PROVIDED, HOWEVER, that the first Offering
Period under the Plan shall commence with the first Trading Day on or after
the date on which the Securities and Exchange Commission declares the
Company's Registration Statement effective and ending on the last Trading Day
on or before April 14, 2002. The Plan shall continue until terminated in
accordance with Section 17 hereof. Subject to Section 17 hereof, the
Administrator shall have the power to change the duration and/or the
frequency of Offering Periods with respect to future offerings and shall use
its best efforts to notify Employees of any such change at least fifteen (15)
days prior to the scheduled beginning of the first Offering Period to be
affected. In no event shall any option granted hereunder be exercisable more
than twenty-seven (27) months from its date of grant.
To the extent permitted by applicable laws, if the Fair Market Value
of a share of Common Stock on any Purchase Date in an Offering Period is
lower than the Fair Market Value of a share of Common Stock on the Enrollment
Date of such Offering Period, then all Participants in such Offering Period
shall be automatically withdrawn from such Offering Period immediately after
the exercise of their option on such Purchase Date and automatically
re-enrolled in the immediately following Offering Period as of the first day
thereof.
SECTION 4. ENROLLMENT; PARTICIPATION.
a. On each Enrollment Date, the Company shall commence an
offering by granting each eligible Employee who has elected to participate in
such Offering Period pursuant to Section 4(b) hereof an option to purchase on
each Purchase Date of such Offering Period up to a number of Shares
determined by dividing each Employee's payroll deductions accumulated prior
to such Purchase Date and retained in the Participant's account as of such
Purchase Date by the applicable Purchase Price; provided that in no event
shall a Participant be permitted to pur-
chase during each Offering Period more than 10,000 Shares (subject to any
adjustment pursuant to Section 16 hereof), PROVIDED, FURTHER, that such
purchase shall be subject to the limitations set forth in Sections 2(b) and
10 hereof. Exercise of the option shall occur as provided in Section 6
hereof, unless the Participant has withdrawn pursuant to Section 8 hereof.
The option with respect to an Offering Period shall expire on the last
Purchase Date with respect to such Offering Period or the withdrawal date if
earlier.
b. Subject to the limitations set forth in Section 2(b)
hereof, an Employee may elect to become a Participant in the Plan by
completing and filing a subscription agreement authorizing the Company to
make payroll deductions (as set forth in Section 5 hereof) at least five (5)
business days prior to the applicable Enrollment Date unless a later time for
filing the subscription agreement is set by the Administrator for all
Employees. Unless a Participant, by giving written notice (or such other
notice as may from time to time be prescribed by the Administrator), elects
not to participate with respect to any subsequent Offering Period, the
Participant shall be deemed to have accepted each new offer and to have
authorized payroll deductions in respect thereof during each subsequent
Offering Period.
SECTION 5. PAYROLL DEDUCTIONS.
a. An Employee may, in accordance with rules and procedures
adopted by the Administrator and subject to the limitation set forth in
Section 2(b) hereof, authorize payroll deductions in amounts which are not
less than one percent (1%) and not more than fifteen percent (15%) of such
Employee's Compensation on each payday during the Offering Period. Payroll
deductions shall commence on the first payroll paid following the Enrollment
Date, and shall end on the last payroll paid prior to each Purchase Date of
the Offering Period to which the subscription agreement is applicable, unless
sooner terminated by the Participant's withdrawal from the Plan or termination
of the Participant's Continuous Status as an Employee as provided in Section 8
hereof. A Participant may increase or decrease his or her rate of payroll
deductions at any time during an Offering Period by giving written notice (or
such other notice as may from time to time be prescribed by the Administrator).
The change in rate shall be effective the first full payroll period following
five (5) business days after the Company's receipt of the new subscription
agreement unless the Company elects to process a given change in rate of
payroll deductions more quickly.
b. All payroll deductions made by a Participant shall be
credited to such Participant's account under the Plan and shall be withheld
in whole percentages only. A Participant may not make any additional payments
into such account.
c. Notwithstanding the foregoing, to the extent necessary to
comply with Section 423(b)(8) of the Code and Section 2(b) hereof, a
Participant's rate of payroll deductions may be decreased by the Company to
zero percent (0%) at any time during an Offering Period. Payroll deductions
shall recommence at the rate provided for in such Participant's subscription
agreement at the beginning of the first Offering Period which is scheduled to
end the following calendar year, unless a Participant increases or decreases
the rate of his or her payroll deductions as provided in Section 5(a) hereof,
or terminates his or her participation in the Plan as provided in Section 8
hereof.
SECTION 6. PURCHASE OF SHARES.
Unless a Participant withdraws from the Plan as provided in Section
8 hereof, such Participant's election to purchase Shares shall be exercised
automatically on each Purchase Date, and the maximum number of whole Shares
subject to option shall be purchased for each Participant at the applicable
Purchase Price with the accumulated payroll deductions in each Participant's
account as of the Purchase Date. No fractional Shares may be purchased
hereunder. Any payroll deductions accumulated in a Participant's account
following the purchase of Shares on any Purchase Date that are not sufficient
to purchase a full Share shall be retained in the Participant's account for
the subsequent Offering Period, subject to earlier withdrawal by the
Participant as provided in Section 8 hereof. Any additional amounts remaining
in a Participant's account following the purchase of Shares on any Purchase
Date that are equal to, or in excess of, the amount required under this
Section 6 to purchase at least one full Share shall be returned to the
Participant as soon as reasonably practicable following the Purchase Date.
During a Participant's lifetime, a Participant's option to purchase Shares
hereunder is exercisable only by the Participant.
SECTION 7. DELIVERY OF SHARES; WITHDRAWAL OR SALE OF SHARES.
As promptly as reasonably practicable after each Purchase Date, the
Company shall either arrange the delivery of the whole Shares purchased on
such date by each Participant to the Participant's brokerage account or
arrange the delivery to the Participant of a share certificate representing
such Shares.
SECTION 8. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
a. A Participant may withdraw all, but not less than all, of
the payroll deductions credited to such Participant's account (that have not
been used to purchase Shares) under the Plan by giving written notice to the
Company at least five (5) business days prior to the Purchase Date of the
Offering Period in which the withdrawal occurs. Withdrawal of payroll
deductions shall be deemed to be a withdrawal from the Plan. All of the
payroll deductions credited to such Participant's account (that have not been
used to purchase Shares) shall be paid to such Participant promptly after
receipt of such Participant's notice of withdrawal, and such Participant's
eligibility to participate in the Plan for the Offering Period in which the
withdrawal occurs shall be automatically terminated. No further payroll
deductions for the purchase of Shares shall be made for such Participant
during such Offering Period. If a Participant withdraws from an Offering
Period, payroll deductions for such Participant shall not resume at the
beginning of the succeeding Offering Period unless the Participant timely
delivers to the Company a new subscription agreement in accordance with the
provisions of Section 4 hereof. A Participant's withdrawal from an Offering
Period shall not have any effect upon a Participant's eligibility to
participate in any similar plan which may hereafter be adopted by the Company
or in succeeding Offering Periods which commence after termination of the
Offering Period from which the Participant withdraws.
a. Upon termination of a Participant's Continuous Status as an
Employee during the Offering Period for any reason, including Participant's
voluntary termination, retirement or death, all the payroll deductions
credited to such Participant's account (that have not been used to purchase
Shares) shall be returned to such Participant or, in the case of such
Participant's death, to the person or persons entitled thereto under Section
12 hereof, and such Participant's option shall be automatically terminated.
Such termination shall be deemed a withdrawal from the Plan.
SECTION 9. INTEREST.
No interest shall accrue on or be payable by the Company with
respect to the payroll deductions of a Participant in the Plan.
SECTION 10. STOCK SUBJECT TO PLAN.
a. Subject to adjustment upon Changes in Capitalization of the
Company as provided in Section 16 hereof, the maximum aggregate number of
Shares which shall be reserved for sale under the Plan shall be 500,000
Shares, plus an annual increase to be added on the first day of the Company's
fiscal year (beginning 2001) equal to the lesser of (i) 200,000 shares or
(ii) one percent (1%) of the number of outstanding shares of Common Stock on
the last Trading Day of the immediately preceding fiscal year. Such Shares
shall be available as of the first day of the first Offering Period that
commences in each such fiscal year. The Shares may consist, in whole or in
part, of authorized and unissued Shares or treasury Shares. If the total
number of Shares which would otherwise be subject to options granted pursuant
to Section 2(a) hereof on an Enrollment Date exceeds the number of Shares
then available under the Plan (after deduction of all Shares for which
options have been exercised or are then outstanding), the Administrator shall
make a pro rata allocation of the Shares remaining available for option grant
in as uniform a manner as shall be practicable and as it shall determine to
be equitable. In such event, the Administrator shall give written notice to
each Participant of such reduction of the number of option Shares affected
thereby and shall similarly reduce the rate of payroll deductions, if
necessary.
b. No Participant shall have rights as a stockholder with
respect to any option granted hereunder until the date on which such Shares
shall be deemed to have been purchased by the Participant in accordance with
Section 6 hereof.
c. Shares purchased on behalf of a Participant under the Plan
shall be registered in the name of the Participant or, if requested in
writing by the Participant, in the names of the Participant and the
Participant's spouse.
SECTION 11. ADMINISTRATION.
The Plan shall be administered by the Board or a Committee. The
Board or the Committee shall have full power and authority, subject to the
provisions of the Plan, to promulgate such rules and regulations as it deems
necessary for the proper administration of the Plan, to interpret the
provisions and supervise the administration of the Plan, and to take all
action in connection therewith or in relation thereto as it deems necessary
or advisable. Any decision reduced to writing and signed by a majority of the
members of the Committee shall be fully effective as if it had been made at a
meeting duly held. The Company shall pay all expenses incurred in the
administration of the Plan. No member of the Board or Committee shall be
personally liable for any action, determination, or interpretation made in
good faith with respect to the Plan, and all members of the Board or
Committee shall be fully indemnified by the Company with respect to any such
action, determination or interpretation.
All decisions, determinations and interpretations of the Board or
Committee shall be final and binding on all persons, including the Company,
its Parent, any Subsidiary, the Employee (or any person claiming any rights
under the Plan through any Employee) and any stockholder of the Company, its
Parent or any Subsidiary.
The Committee may adopt rules or procedures relating to the
operation and administration of the Plan to accommodate the specific
requirements of local laws and procedures. Without limiting the generality of
the foregoing, the Committee is specifically authorized to adopt rules and
procedures regarding handling of payroll deductions, payment of interest,
conversion of local currency, payroll tax, withholding procedures and
handling of stock certificates which vary
with local requirements. The Committee may also adopt sub-plans applicable to
particular Subsidiaries or locations, which sub-plans may be designed to be
outside the scope of Section 423 of the Code. The rules of such sub-plans may
take precedence over other provisions of this Plan, with the exception of
Section 10(a), but unless otherwise superseded by the terms of such sub-plan,
the provisions of this Plan shall govern the operation of such sub-plan.
SECTION 12. DESIGNATION OF BENEFICIARY.
a. A Participant may file, on forms supplied by and delivered
to the Company, a written designation of a beneficiary who is to receive
Shares and/or cash, if any, remaining in such Participant's account under the
Plan in the event of the Participant's death.
b. Such designation of beneficiary may be changed by the
Participant at any time by written notice. In the event of the death of a
Participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such Participant's death, the Company shall
deliver the balance of the Shares and/or cash credited to Participant's
account to the executor or administrator of the estate of the Participant or,
if no such executor or administrator has been appointed (to the knowledge of
the Company), the Company, in its discretion, may deliver such Shares and/or
cash to the spouse or to any one or more dependents or relatives of the
Participant, or if no spouse, dependent or relative is known to the Company,
then to such other person as the Company may designate.
SECTION 13. TRANSFERABILITY.
Neither payroll deductions credited to a Participant's account nor
any rights with regard to the exercise of an option or any rights to receive
Shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by the laws of descent and distribution or
as provided in Section 12 hereof) by the Participant. Any such attempt at
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may treat such act as an election to withdraw funds
in accordance with Section 8 hereof.
SECTION 14. USE OF FUNDS.
All payroll deductions received or held by the Company under the
Plan may be used by the Company for any corporate purpose, and the Company
shall not be obligated to segregate such payroll deductions.
SECTION 15. REPORTS.
Individual accounts shall be maintained by the Company for each
Participant in the Plan. Statements of account shall be given to each
Participant at least annually which statements shall set forth the amounts of
payroll deductions, the Purchase Price, the number of Shares purchased and
the remaining cash balance, if any.
SECTION 16. EFFECT OF CERTAIN CHANGES.
In the event of a Change in Capitalization or the distribution of an
extraordinary dividend, the Administrator shall conclusively determine the
appropriate equitable adjustments, if any, to be made under the Plan,
including without limitation adjustments to the number of Shares which have
been authorized for issuance under the Plan, but have not yet been placed
under option, as well as the Purchase Price of each option under the Plan
which has not yet been exercised. In the event of a Change in Control of the
Company, the Offering Period shall terminate unless otherwise provided by the
Administrator.
SECTION 17. AMENDMENT OR TERMINATION.
The Board may at any time terminate or amend the Plan. Except as
provided in Section 16 hereof, no such termination may adversely affect
options previously granted and no amendment may make any change in any option
theretofore granted which adversely affects the rights of any Participant. To
the extent necessary to comply with Section 423 of the Code (or any successor
rule or provision or any other applicable law, regulation or stock exchange
rule), the Company shall obtain stockholder approval in such a manner and to
such a degree as required.
SECTION 18. NOTICES.
All notices or other communications by a Participant to the Company
under or in connection with the Plan shall be deemed to have been duly given
when they are received in a timely manner in the form specified by the
Company at the location, or by the person, designated by the Company for the
receipt thereof.
SECTION 19. REGULATIONS AND OTHER APPROVALS; GOVERNING LAW.
(a) This Plan and the rights of all persons claiming hereunder
shall be construed and determined in accordance with the laws of the State of
California without giving effect to the choice of law principles thereof,
except to the extent that such law is preempted by Federal law.
(b) The obligation of the Company to sell or deliver Shares
with respect to options granted under the Plan shall be subject to all
applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by
governmental agencies as may be deemed necessary or appropriate by the
Administrator.
SECTION 20. WITHHOLDING OF TAXES.
If the Participant makes a disposition, within the meaning of
Section 424(c) of the Code of any Share or Shares issued to Participant
pursuant to Participant's exercise of an option, and such disposition occurs
within the two-year period commencing on the day after the Enrollment Date or
within the one-year period commencing on the day after the Purchase Date,
Participant shall, within ten (10) days of such disposition, notify the
Company thereof and thereafter immediately deliver to the Company any amount
of Federal, state or local income taxes and other amounts which the Company
informs the Participant the Company may be required to withhold.
SECTION 21. EFFECTIVE DATE.
Subject to the approval of the Plan by the stockholders of the
Company within twelve (12) months before or after the date the Plan is
adopted by the Board, the Plan shall be effective as of the first Trading Day
on or after the date on which the Securities and Exchange Commission declares
the Company's Registration Statement effective (the "Effective Date").
SECTION 22. TERM OF PLAN.
No option shall be granted pursuant to the Plan and no Offering
Period shall commence on or after the tenth anniversary of the Effective
Date, but options theretofore granted may extend beyond that date.