EXHIBIT 99.1
STOCKERYALE, INC.
2000 EMPLOYEE STOCK PURCHASE PLAN
The purpose of the StockerYale 2000 Employee Stock Purchase Plan ("the
Plan") is to provide eligible employees of StockerYale, Inc., a Massachusetts
corporation (the "Company"), and certain of its subsidiaries with opportunities
to purchase shares of the Company's common stock, par value $.001 per share (the
"Common Stock"). One hundred thousand (100,000) shares of Common Stock in the
aggregate have been approved and reserved for this purpose. The Plan is intended
to constitute an "employee stock purchase plan" within the meaning of Section
423(b) of the Internal Revenue Code of 1986, as amended (the "Code"), and shall
be interpreted in accordance with that intent.
1. ADMINISTRATION. The Plan will be administered by the person or
persons (the "Administrator") appointed by the Company's Board of Directors (the
"Board") for such purpose. The Administrator has authority to make rules and
regulations for the administration of the Plan, and its interpretations and
decisions with regard thereto shall be final and conclusive. No member of the
Board or individual exercising administrative authority with respect to the Plan
shall be liable for any action or determination made in good faith with respect
to the Plan or any option granted hereunder.
2. OFFERINGS. The Company will make one or more offerings to eligible
employees to purchase Common Stock under the Plan ("Offerings"). Unless
otherwise determined by the
Administrator, the initial Offering will begin on July 1, 2000 and will end on
December 31, 2000 (the "Initial Offering"). Beginning on January 1, 2001, so
long as the Plan is in operation, subsequent offerings shall begin on the first
business day on or after each January 1 and July 1 (the "Offering Date") and
shall end on the last business day prior to the six month anniversary of such
Offering (the 6-month period being the "Offering Period"). The Administrator
may, in its discretion, designate a different period for any Offering, provided
that no Offering shall exceed 24 months in duration.
3. ELIGIBILITY. All employees of the Company (including employees who
are also directors of the Company) and all employees of each Designated
Subsidiary (as defined in Section 11) are eligible to participate in any one or
more of the Offerings under the Plan, provided that they are customarily
employed by the Company or a Designated Subsidiary for more than twenty (20)
hours a week, they have completed at least six months of employment and they are
employed by the Company prior to the first day of the relevant Offering Period.
4. PARTICIPATION. An employee on any Offering Date may participate in
such Offering by submitting an enrollment form to his appropriate payroll
location at least fifteen (15) business days before the Offering Date (or by
such other deadline as shall be established for the Offering). The form will (a)
authorize the purchase of Common Stock for him in each Offering in accordance
with the terms of the Plan, (b) specify the exact name or names in which shares
of Common Stock purchased for him are to be issued pursuant to Section 10 and
(c), provide for a whole percentage to be deducted from his Compensation (as
defined in Section 11). An employee who does not enroll in accordance with these
procedures will be
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deemed to have waived his right to participate. Unless an employee files a new
enrollment form or withdraws from the Plan his deductions will continue at the
same percentage of Compensation for future Offerings, provided he remains
eligible. Notwithstanding the foregoing, participation in the Plan will neither
be permitted nor be denied contrary to the requirements of the Code.
5. EMPLOYEE CONTRIBUTIONS. No employee shall be eligible to contribute
more than ten percent (10%) of his Compensation. In any year, each eligible
employee may authorize payroll deductions, in whole percentages, at a minimum of
one percent (1%) up to a maximum of ten percent (10%) of his Compensation for
each pay period. The Company will maintain book accounts showing the amount of
payroll deductions made by each participating employee for each Offering. No
interest will accrue or be paid on payroll deductions.
6. DEDUCTION CHANGES. Except as may be determined by the Administrator
in advance of an Offering, an employee may not increase or decrease his payroll
deduction during any Offering. However, he may increase or decrease his payroll
deduction with respect to the next Offering for which he is eligible to
participate (subject to the limitations of Section 5) by filing a new enrollment
form at least fifteen (15) business days before the next Offering Date (or by
such other deadline as shall be established for the Offering). The Administrator
may, in advance of any Offering, establish rules permitting an employee to
increase, decrease or terminate his payroll deduction during an Offering.
7. WITHDRAWAL. An employee may withdraw from participation in the Plan
by delivering a written notice of withdrawal to his appropriate payroll
location. The employee's
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withdrawal will be effective as of the next business day. Following an
employee's withdrawal, the Company will promptly refund to him his entire
account balance under the Plan (after payment for any Common Stock purchased in
previously completed Offerings before the effective date of withdrawal). Partial
withdrawals are not permitted. The employee may not re-enroll in any Offering
from which he has withdrawn, but may enroll in a subsequent Offering in
accordance with Section 4.
8. GRANT OF OPTIONS. On each Offering Date, the Company will grant to
each eligible employee who is then a participant in the Plan an option
("Option") to purchase, at the Option Price hereinafter provided for, (a) a
number of shares of Common Stock which number shall not exceed the number of
whole shares which is less than or equal to $12,500 divided by the closing price
per share of Common Stock on the Offering Date, or (b) such other lesser maximum
number of shares as shall have been established by the Administrator in advance
of the Offering. The purchase price for each share purchased under such Option
(the "Option Price") will be 85% of the Fair Market Value of the Common Stock on
the Offering Date or the Exercise Date, whichever is less.
Notwithstanding the foregoing, no employee may be granted an option
hereunder if such employee, immediately after the option was granted, would be
treated as owning stock possessing five percent (5%) or more of the total
combined voting power or value of all classes of stock of the Company or any
Parent or Subsidiary (as defined in Section 11). For purposes of the preceding
sentence, the attribution rules of Section 424(d) of the Code shall apply in
determining the stock ownership of an employee, and all stock which the employee
has a
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contractual right to purchase shall be treated as stock owned by the employee.
In addition, no employee may be granted an Option which permits his rights to
purchase stock under the Plan, and any other employee stock purchase plan of the
Company and its Parents and Subsidiaries, to accrue at a rate which exceeds
$25,000 of the fair market value of such stock (determined on the option grant
date or dates) for each calendar year in which the Option is outstanding at any
time. The purpose of the limitation in the preceding sentence is to comply with
Section 423(b)(8) of the Code.
9. EXERCISE OF OPTION AND PURCHASE OF SHARES. Each employee who
continues to be a participant in the Plan shall be deemed to have exercised his
Option on the last business day of the applicable Offering Period (the "Exercise
Date"). Upon any exercise, the employee shall acquire from the Company such
number of whole shares of Common Stock reserved for the purpose of the Plan as
his accumulated payroll deductions on such Exercise Date will purchase at the
Option Price, subject to any other limitations contained in the Plan. Any amount
remaining in an employee's account at the end of an Offering Period solely by
reason of the inability to purchase a fractional share will be carried forward
to the next Offering; any other balance remaining in an employee's account at
the end of an Offering will be refunded to the employee promptly.
10. ISSUANCE OF CERTIFICATES. Certificates representing shares of
Common Stock purchased under the Plan may be issued only in the name of the
employee, in the name of the employee and another person of legal age as joint
tenants with rights of survivorship, or in the name of a broker authorized by
the employee to be his, or their, nominee for such purpose.
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11. DEFINITIONS.
The term "Compensation" means the amount of base pay, overtime and
commissions, each prior to salary reduction pursuant to either Section 125 or
401(k) of the Code, but excluding incentive or bonus awards, allowances and
reimbursements for expenses such as relocation allowances or travel expenses,
income or gains on the exercise of Company stock options, and similar items.
The term "Designated Subsidiary" means any present or future Subsidiary
(as defined below) that has been designated by the Board to participate in the
Plan. The Board may so designate any Subsidiary, or revoke any such designation,
at any time and from time to time, either before or after the Plan is approved
by the stockholders.
The term "Fair Market Value of the Common Stock" means (i) if the
Common Stock is admitted to trading on a national securities exchange or the
Nasdaq National Market, the closing price reported for the Common Stock on such
exchange or system for such date or, if no sales were reported for such date,
for the next preceding date for which a sale was reported, or (ii) if clause (i)
does not apply but the Common Stock is admitted to quotation on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") or on
the Nasdaq Over the Counter Market ("OTC"), the average of the highest bid and
lowest asked prices reported or quoted for the Common Stock on NASDAQ or OTC, as
the case may be, for such date or, if no bid and asked prices were reported for
such date, for the next preceding date for which such prices were reported, or
(iii) if neither clause (i) or (ii) is applicable, as determined in good faith
by the Administrator.
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The term "Parent" means a "parent corporation" with respect to the
Company, as defined in Section 424(e) of the Code.
The term "Subsidiary" means a "subsidiary corporation" with respect to
the Company, as defined in Section 424(f) of the Code.
12. RIGHTS ON TERMINATION OF EMPLOYMENT. If a participating employee's
employment terminates for any reason before an Exercise Date for any Offering,
no payroll deduction will be taken from any pay due and owing to the employee
and the balance in his account will be paid to him or, in the case of his death,
to his designated beneficiary as if he had withdrawn from the Plan under
Section 7. An employee will be deemed to have terminated employment, for this
purpose, if the corporation that employs him, having been a Designated
Subsidiary, ceases to be a Subsidiary, or if the employee is transferred to any
corporation other than the Company or a Designated Subsidiary.
13. SPECIAL RULES. Notwithstanding anything herein to the contrary, the
Administrator may adopt special rules applicable to the employees of a
particular Designated Subsidiary, whenever the Administrator determines that
such rules are necessary or appropriate for the implementation of the Plan in a
jurisdiction where such Designated Subsidiary has employees; provided that such
rules are consistent with the requirements of Section 423(b) of the Code. Such
special rules may include (by way of example, but not by way of limitation) the
establishment of a method for employees of a given Designated Subsidiary to fund
the purchase of shares other than by payroll deduction, if the payroll deduction
method is prohibited by local law or is otherwise impracticable. Any special
rules established pursuant
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to this Section 13 shall, to the extent possible, result in the employees
subject to such rules having substantially the same rights as other participants
in the Plan.
14. OPTIONEE NOT STOCKHOLDERS. Neither the granting of an Option to an
employee nor the deductions from his pay shall constitute such employee a holder
of the shares of Common Stock covered by an Option under the Plan until such
shares have been purchased by and issued to him.
15. RIGHTS NOT TRANSFERABLE. Rights under the Plan are not transferable
by a participating employee other than by will or the laws of descent and
distribution, and are exercisable during the employee's lifetime only by the
employee.
16. APPLICATION OF FUNDS. All funds received or held by the Company
under the Plan may be combined with other corporate funds and may be used for
any corporate purpose.
17. ADJUSTMENT IN CASE OF CHANGES AFFECTING COMMON STOCK. In the event
of a subdivision of outstanding shares of Common Stock, or the payment of a
dividend in Common Stock, the number of shares approved for the Plan, and the
share limitation set forth in Section 8, shall be increased proportionately, and
such other adjustment shall be made as may be deemed equitable by the
Administrator. In the event of any other change affecting the Common Stock, such
adjustment shall be made as may be deemed equitable by the Administrator to give
proper effect to such event.
18. AMENDMENT OF THE PLAN. The Board may at any time, and from time to
time, amend the Plan in any respect, except that without the approval, within
twelve (12) months of such Board action, by the holders of a majority of the
shares of stock of the Company present
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or represented and entitled to vote at a meeting of stockholders, no amendment
shall be made increasing the number of shares approved for the Plan or making
any other change that would require stockholder approval in order for the Plan,
as amended, to qualify as an "employee stock purchase plan" under Section 423(b)
of the Code.
19. INSUFFICIENT SHARES. If the total number of shares of Common Stock
that would otherwise be purchased on any Exercise Date plus the number of shares
purchased under previous Offerings under the Plan exceeds the maximum number of
shares issuable under the Plan, the shares then available shall be apportioned
among participants in proportion to the amount of payroll deductions accumulated
on behalf of each participant that would otherwise be used to purchase Common
Stock on such Exercise Date.
20. TERMINATION OF THE PLAN. The Plan may be terminated at any time by
the Board. Upon termination of the Plan, all amounts in the accounts of
participating employees shall be promptly refunded.
21. GOVERNMENTAL REGULATIONS. The Company's obligation to sell and
deliver Common Stock under the Plan is subject to obtaining all governmental
approvals required in connection with the authorization, issuance, or sale of
such stock.
The Plan shall be governed by Massachusetts law except to the extent
that such law is preempted by federal law.
22. ISSUANCE OF SHARES. Shares may be issued upon exercise of an Option
from authorized but unissued Common Stock, from shares held in the treasury of
the Company, or from any other proper source.
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23. TAX WITHHOLDING. Participation in the Plan is subject to any
required tax withholding on income of the participant in connection with the
Plan. Each employee agrees, by entering the Plan, that the Company and its
Subsidiaries shall have the right to deduct any such taxes from any payment of
any kind otherwise due to the employee, including shares issuable under the
Plan.
24. NOTIFICATION UPON SALE OF SHARES. Each employee agrees, by entering
the Plan, to give the Company prompt notice of any disposition of shares
purchased under the Plan where such disposition occurs within two years after
the date of grant of the Option pursuant to which such shares were purchased.
25. EFFECTIVE DATE AND APPROVAL OF SHAREHOLDERS. The Plan shall take
effect upon adoption by the Board subject to the approval by the holders of a
majority of the shares of stock of the Company present or represented and
entitled to vote at a meeting of stockholders, which approval must occur within
twelve (12) months of the adoption of the Plan by the Board.
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