Exhibit 4.2
NEUROCRINE BIOSCIENCES, INC.
AMENDED 1992 INCENTIVE STOCK PLAN
(as amended May 27, 1997, May 27, 1998,
May 21, 1999, May 24, 2000 and May 24, 2001)
1. Purpose of the Plan. The purposes of this Incentive Stock Plan are to
attract and retain the best available personnel, to provide additional
incentive to the employees of Neurocrine Biosciences, Inc. (the "Company")
and to promote the success of the Company's business.
Options granted hereunder may be either Incentive Stock Options or
Nonstatutory Stock Options, at the discretion of the Board and as reflected
in the terms of the written option agreement. The Board also has the
discretion to grant Stock Purchase Rights.
2. Definitions.
(a) "Board" shall mean the Committee, if one has been appointed, or the
Board of Directors of the Company, if no Committee is appointed.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Committee" shall mean the Committee appointed by the Board of
Directors in accordance with Section 4(a) of the Plan, if one is
appointed.
(d) "Common Stock" shall mean the Common Stock of the Company.
(e) "Company" shall mean Neurocrine Biosciences, Inc.
(f) "Consultant" shall mean any person who is engaged by the Company or
any Parent or Subsidiary to render consulting services and is
compensated for such consulting services, and any director of the
Company whether compensated for such services or not.
(g) "Continuous Status as an Employee or Consultant" shall mean the
absence of any interruption or termination of service as an Employee
or Consultant, as applicable. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of sick
leave, military leave, or any other leave of absence approved by the
Board; provided that such leave is for a period of not more than 90
days or reemployment upon the expiration of such leave is guaranteed
by contract or statute.
(h) "Employee" shall mean any persons, 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
to constitute "employment" by the Company.
(i) "Incentive Stock Option" shall mean an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the
Code.
(j) "Nonstatutory Stock Option" shall mean an Option not intended to
qualify as an Incentive Stock Option.
(k) "Option" shall mean a stock option granted pursuant to the Plan.
(l) "Optioned Stock" shall mean the Common Stock subject to an Option or
Stock Purchase Right.
(m) "Optionee" shall mean an Employee or Consultant who receives an
Option.
(n) "Parent" shall mean a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(o) "Plan" shall mean this 1992 Incentive Stock Plan.
(p) "Purchaser" shall mean an Employee or Consultant who exercises a Stock
Purchase Right.
(q) "Share" shall mean a share of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.
(r) "Stock Purchase Right" shall mean a right to purchase Common Stock
pursuant to the Plan or the right to receive a bonus of Common Stock
for past services.
(s) "Subsidiary" shall mean a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 11 of the
Plan, the maximum aggregate number of shares under the Plan is 6,800,000
shares of Common Stock. The Shares may be authorized but unissued, or
reacquired Common Stock.
If an Option or Stock Purchase Right should expire or become
unexercisable for any reason without having been exercised in full, then
the unpurchased Shares which were subject thereto shall, unless the Plan
shall have been terminated, become available for future grant or sale under
the Plan. Notwithstanding any other provision of the Plan, shares issued
under the Plan and later repurchased by the Company shall not become
available for future grant or sale under the Plan.
4. Administration of the Plan.
(a) Procedure.
(i) Multiple Administrative Bodies. The Plan may be administered by
different Committees with respect to different groups of
Employees and Consultants. (ii) Section 162(m). To the extent
that the Administrator determines it to be desirable to qualify
Options granted hereunder as "performance-based compensation"
within the meaning of Section 162(m) of the Code, the Plan shall
be administered by a Committee of two or more "outside directors"
within the meaning of Section 162(m) of the Code.
(iii)Rule 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions
contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.
(iv) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which
committee shall be constituted to satisfy applicable laws.
(b) Powers of the Board. Subject to the provisions of the Plan, the Board
shall have the authority, in its discretion:
(i) to grant Incentive Stock Options, Nonstatutory Stock Options or
Stock Purchase Rights;
(ii) to determine, upon review of relevant information and in
accordance with Section 7 of the Plan, the fair market value of
the Common Stock;
(iii)to determine the exercise price per share of Options or Stock
Purchase Rights, to be granted, which exercise price shall be
determined in accordance with Section 7 of the Plan;
(iv) to determine the Employees or Consultants to whom, and the time
or times at which, Options or Stock Purchase Rights shall be
granted and the number of shares to be represented by each Option
or Stock Purchase Right;
(v) to interpret the Plan;
(vi) to prescribe, amend and rescind rules and regulations relating to
the Plan;
(vii)to determine the terms and provisions of each Option and Stock
Purchase Right granted (which need not be identical) and, with
the consent of the holder thereof, modify or amend any provisions
(including provisions relating to exercise price) of any Option
or Stock Purchase Right;
(viii) to accelerate or defer (with the consent of the Optionee) the
exercise date of any Option, consistent with the provisions of
Section 5 of the Plan;
(ix) to authorize any person to execute on behalf of the Company any
instrument required to effectuate the grant of an Option or Stock
Purchase Right previously granted by the Board;
(x) to allow Optionees to satisfy withholding tax obligations by
electing to have the Company withhold from the Shares to be
issued upon exercise of an Option or Stock Purchase Right that
number of Shares having a Fair Market Value equal to the amount
required to be withheld. The Fair Market Value of the Shares to
be withheld shall be determined on the date that the amount of
tax to be withheld is to be determined. All elections by an
Optionee to have Shares withheld for this purpose shall be made
in such form and under such conditions as the Administrator may
deem necessary or advisable; and
(xi) to make all other determinations deemed necessary or advisable
for the administration of the Plan.
(c) Effect of Board's Decision. All decisions, determinations and
interpretations of the Board shall be final and binding on all
Optionees, Purchasers and any other holders of any Options or Stock
Purchase Rights granted under the Plan.
5. Eligibility.
(a) Options and Stock Purchase Rights may be granted to Employees and
Consultants, provided that Incentive Stock Options may only be granted
to Employees. An Employee or Consultant who has been granted an Option
or Stock Purchase Right may, if such Employee or Consultant is
otherwise eligible, be granted additional Option(s) or Stock Purchase
Right(s).
(b) Each Option shall be designated in the written option agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option.
However, notwithstanding such designation, to the extent that the
aggregate fair market value of the Shares with respect to which
Options designated as Incentive Stock Options are exercisable for the
first time by any Optionee during any calendar year (under all plans
of the Company) exceeds $100,000, such Options shall be treated as
Nonstatutory Stock Options.
(c) For purposes of Section 5(b), Options shall be taken into account in
the order in which they were granted, and the fair market value of the
Shares shall be determined as of the time the Option with respect to
such Shares is granted.
(d) The Plan shall not confer upon any Optionee or holder of a Stock
Purchase Right any right with respect to continuation of employment by
or the rendition of consulting services to the Company, nor shall it
interfere in any way with his or her right or the Company's right to
terminate his or her employment or services at any time, with or
without cause.
(e) The following limitations shall apply to grants of Options to
Employees:
(i) No Employee shall be granted, in any fiscal year of the Company,
Options to purchase more than 250,000 Shares.
(ii) In connection with his or her initial employment, an Employee may
be granted Options to purchase up to an additional 250,000 Shares
which shall not count against the limit set forth in subsection
(i) above.
(iii)The foregoing limitations shall be adjusted proportionately in
connection with any change in the Company's capitalization as
described in Section 11.
(iv) If an Option is canceled in the same fiscal year of the Company
in which it was granted (other than in connection with a
transaction described in Section 12), the canceled Option shall
be counted against the limit set forth in subsection (i) above.
For this purpose, if the exercise price of an Option is reduced,
such reduction will be treated as a cancellation of the Option
and the grant of a new Option.
6. Term of Plan. The Plan shall become effective upon the earlier to occur of
its adoption by the Board of Directors or its approval by vote of holders
of a majority of the outstanding shares of the Company entitled to vote on
the adoption of the Plan. It shall continue in effect for a term of ten
(10) years unless sooner terminated under Section 13 of the Plan.
7. Exercise Price and Consideration.
(a) The per Share exercise price for the Shares to be issued pursuant to
exercise of an Option or Stock Purchase Right shall be such price as
is determined by the Board, but shall be subject to the following:
(i) In the case of an Incentive Stock Option; (A) granted to an
Employee who, at the time of grant of such Incentive Stock
Option, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price shall be no
less than 110% of the fair market value per Share on the date of
grant. (B) granted to any other Employee, the per Share exercise
price shall be no less than 100% of the fair market value per
Share on the date of grant.
(ii) In the case of a Nonstatutory Stock Option or a Stock Purchase
Right, the per Share exercise price shall be no less than 85% of
the fair market value per Share on the date of grant. In the case
of a Nonstatutory Stock Option intended to qualify as
"performance-based compensation" within the meaning of Section
162(m) of the Code, the per Share exercise price shall be no less
than 100% of the Fair Market Value per Share on the date of
grant.
(iii)Notwithstanding the foregoing, Options may be granted with a per
Share exercise price of less than 100% of the Fair Market Value
per Share on the date of grant pursuant to a merger or other
corporate transaction.
For purposes of this Section 7(a), in the event that an Option or
Stock Purchase Right is amended to reduce the exercise price, the date
of grant of such Option or Stock Purchase Right shall thereafter be
considered to be the date of such amendment.
(b) The fair market value shall be determined by the Board in its
discretion; provided, however, that where there is a public market for
the Common Stock, the fair market value per Share shall be the mean of
the bid and asked prices (or the closing price per share if the Common
Stock is listed on the National Association of Securities Dealers
Automated Quotation ("NASDAQ") National Market System) of the Common
Stock for the date of grant, as reported in the Wall Street Journal
(or, if not so reported, as otherwise reported by the NASDAQ System)
or, in the event the Common Stock is listed on a stock exchange, the
fair market value per Share shall be the closing price on such
exchange on the date of grant of the Option or Stock Purchase Right,
as reported in the Wall Street Journal.
(c) The consideration to be paid for the Shares to be issued upon exercise
of an Option or Stock Purchase Right, including the method of payment,
shall be determined by the Board (and in the case of an Incentive
Stock Option, shall be determined at the time of grant) and may
consist entirely of cash, check, promissory note, other Shares of
Common Stock which
(i) 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
(ii) 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, or any combination of such methods of
payment, or such other consideration and method of payment for
the issuance of Shares to the extent permitted under Sections 408
and 409 of the California General Corporation Law. In making its
determination as to the type of consideration to accept, the
Board shall consider if acceptance of such consideration may be
reasonably expected to benefit the Company (Section 315(b) of the
California General Corporation Law).
8. Options.
(a) Term of Option. The term of each Option shall be the term stated in
the Option Agreement; provided, however, that the term shall be no
more than ten (10) years from the date of grant thereof. In the case
of an Incentive Stock Option granted to an Optionee who, at the time
the Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or
any Parent or Subsidiary, the term of the Option shall be five (5)
years from the date of grant thereof or such shorter term as may be
provided in the Option Agreement.
(b) Exercise of Option.
(i) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times and under
such conditions as determined by the Board, including performance
criteria with respect to the Company and/or the Optionee, and as
shall be permissible under the terms of the Plan, but in no case
at a rate of less than 20% per year over five (5) years from the
date the Option is granted.
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, as authorized by the Board, consist of
any consideration and method of payment allowable under Section 7
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 Company) of the stock certificate
evidencing such Shares no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the
Optioned Sock, notwithstanding the exercise of the Option. The
Company shall issue (or cause to be issued) such stock
certificate promptly upon exercise of the Option. In the event
that the exercise of a Nonstatutory Stock Option pursuant to
Section 5(b), the Company shall issue a separate stock
certificate evidencing the Shares treated as acquired upon
exercise of an Incentive Stock Option and a separate stock
certificate evidencing the Shares treated as acquired upon
exercise of a Nonstatutory Stock Option and shall identify each
such certificate accordingly in its stock transfer records. 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 11 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.
(ii) Termination of Status as an Employee or Consultant. In the event
of termination of an Optionee's Continuous Status as an Employee
or Consultant (as the case may be), such Optionee may, but only
within such period of time as is determined by the Board, with
such determination in the case of an Incentive Stock Option not
exceeding three (3) months and in the case of Nonstatutory Stock
Option not exceeding six (6) months after the date of
termination, with such determination in the case of an Incentive
Stock Option being made at the time of grant of the Option,
exercise the Option to the extent that such Employee or
Consultant was entitled to exercise it at the date of such
termination (but in no event later than the date of expiration of
the term of such Option as set forth in the Option Agreement). To
the extent that such Employee or Consultant was not entitled to
exercise the Option at the date of such termination, or if such
Employee or Consultant does not exercise such Option (which such
Employee or Consultant was entitled to exercise) within the time
specified herein, the Option shall terminate.
(iii)Disability of Optionee. Notwithstanding the provisions of
Section 8(b)(ii) above, in the event of termination of an
Optionee's Continuous Status as an Employee or Consultant as a
result of such Employee's or Consultant's total and permanent
disability (as defined in Section 22(e)(3) of the Code), such
Employee or Consultant may, but only within six (6) months (or
such other period of time not exceeding twelve (12) months as in
determined by the Board, with such determination in the case of
an Incentive Stock Option being made at the time of gant of the
Option) from the date of such termination (but in no event later
than the date of expiration of the term of such Option as set
forth in the Option Agreement), exercise the Option to the extent
such Employee or Consultant was entitled to exercise it at the
date of such termination. To the extent that such Employee or
Consultant was not entitled to exercise the Option at the date of
termination, or if such Employee or Consultant does not exercise
such Option (which such Employee or Consultant was entitled to
exercise) within the time specified herein, the Option shall
terminate.
(iv) Death of Optionee. In the event of the death of an Optionee:
(A) during the term of the Option who is at the time of his or
her death an Employee or Consultant of the Company and who
shall have been in Continuous Status as an Employee or
Consultant since the date of grant of the Option, the Option
may be exercised, at any time within six (6) months (but in
no event later than the date of expiration of the term of
such Option as set forth in the Option Agreement), 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 that the right to exercise would have accrued had
the Optionee continued living and remained in Continuous
Status as an Employee or Consultant six (6) months (or such
other period of time as in determined by the Board at the
time of grant of the Option) after the date of death; or
(B) within thirty (30) days (or such other period of time not
exceeding three (3) months as is determined by the Board,
with such determination in the case of an Incentive Stock
Option being made at the time of grant of the Option) after
the termination of Continuous Status as an Employee or
Consultant, the Option may be exercised, at any time within
six (6) months (or such other period of time as is
determined by the Board at the time of grant of the Option)
following the date of death (but in no event later than the
date of expiration of the term of such Option as set forth
in the Option Agreement), 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 termination.
9. Stock Purchase Rights.
(a) Rights to Purchase. After the Board of Directors determines that it
will offer an Employee or Consultant a Stock Purchase Right, it shall
deliver to the offeree a stock purchase agreement or stock bonus
agreement, as the case may be, setting forth the terms, conditions and
restrictions relating to the offer, including the number of Shares
which such person shall be entitled to purchase, and the time within
which such person must accept such offer, which shall in no event
exceed six (6) months from the date upon which the Board of Directors
or its Committee made the determination to grant the Stock Purchase
Right. The offer shall be accepted by execution of a stock purchase
agreement or stock bonus agreement in the from determined by the Board
of Directors.
(b) Issuance of Shares. Forthwith after payment therefor, the Shares
purchased shall be duly issued; provided, however, that the Board may
require that the Purchaser make adequate provision for any Federal and
State withholding obligations of the Company as a condition to the
Purchaser purchasing such Shares.
(c) Repurchase Option. Unless the Board determines otherwise, the stock
purchase agreement or stock bonus agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary
termination of the Purchaser's employment with the Company for any
reason (including death or disability). If the Board so determines,
the purchase price for shares repurchased may be paid by cancellation
of any indebtedness of the Purchaser to the Company. The repurchase
option shall lapse at such rate as the Board may determine.
(d) Other Provisions. The stock purchase agreement or stock bonus
agreement shall contain such other terms, provisions and conditions
not inconsistent with the Plan as may be determined by the Board of
Directors.
10. Non-Transferability of Options and Stock Purchase Rights. Unless determined
otherwise by the Administrator, an Option or Stock Purchase Right 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 Stock Purchase Right
transferable, such Option or Stock Purchase Right shall contain such
additional terms and conditions as the Administrator deems appropriate.
11. Adjustments upon Changes in Capitalization or Merger.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock
covered by each outstanding Option or Stock Purchase Right, and the
number of shares of Common Stock which have been authorized for
issuance under the Plan but as to which no Options or Stock Purchase
Rights have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase Right,
as well as the price per share of Common Stock covered by each such
outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares
of Common Stock 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 number of issued shares of
Common Stock effected without receipt of consideration by the Company.
The 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 of Common Stock
subject to an Option or Stock Purchase Right.
(b) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, the Administrator shall notify the
Optionee or Purchaser at least fifteen (15) days prior to such
proposed action. To the extent it has not been previously exercised,
the Option or Stock Purchase Right shall terminate immediately prior
to the consummation of such proposed action.
(c) Merger or Asset Sale. In the event of a merger, sale of all or
substantially all of the assets of the Company, tender offer or other
transaction or series of related transactions resulting in a change of
ownership of more than 50% of the voting securities of the Company
("Change in Control"), approved by the majority of the members of the
Board on the Board prior to the commencement of such Change in
Control, each outstanding Option shall be assumed or an equivalent
option or right substituted by the successor corporation or a Parent
or Subsidiary of the successor corporation; provided however, in the
event that within one year of the date of the completion of the Change
in Control, the successor corporation or a Parent or Subsidiary of the
successor corporation terminates the employment of an Optionee without
Cause (as defined below), such Optionee shall fully vest in and have
the right to exercise the options assumed or substituted for the
Option as to all of the Optioned Stock, including Shares as to which
it would not otherwise be exercisable. In the event that the successor
corporation refuses to assume or substitute for the Option, the
Optionee shall fully vest in and have the right to exercise the Option
as to all of the Optioned Stock, including Shares as to which it would
not otherwise be exercisable. If an Option becomes fully vested and
exercisable in lieu of assumption or substitution in the event of a
Change of Control, the Administrator shall notify the Optionee in
writing or electronically that the Option shall be fully vested and
exercisable for a period of fifteen (15) days from the date of such
notice, and the Option shall terminate upon the expiration of such
period. For the purposes of this paragraph, the Option shall be
considered assumed if, following the Change of Control, the option
confers the right to purchase, for each Share of Optioned Stock
subject to the Option immediately prior to the Change in Control, the
consideration (whether stock, cash, or other securities or property)
received in the Change of Control by holders of Common Stock for each
Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration
chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Change
of Control is not solely common stock of the successor corporation or
its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the
exercise of the Option, for each Share of Optioned Stock subject to
the Option, to be solely common stock of the successor corporation or
its Parent equal in fair market value to the per share consideration
received by holders of Common Stock in the Change of Control. For
purposes of this paragraph, termination shall be for "Cause" in the
event of the occurrence of any of the following: (a) any intentional
action or intentional failure to act by employee which was performed
in bad faith and to the material detriment of the successor
corporation or its Parent or Subsidiary; (b) employee willfully and
habitually neglects the duties of employment; or (c) employee is
convicted of a felony crime involving moral turpitude, provided that
in the event that any of the foregoing events is capable of being
cured, the successor corporation or its Parent or Subsidiary shall
provide written notice to the employee describing the nature of such
event and the employee shall thereafter have five (5) business days to
cure such event.
In the event of a Change in Control which is not approved by the
majority of the members of the Board on the Board prior to the
commencement of a Change in Control, each Optionee shall fully vest in
and have the right to exercise all outstanding Options as to all of
the Optioned Stock, including Shares as to which it would not
otherwise be exercisable.
12. Date of Granting Options. The date of grant of an Option or Stock Purchase
Right shall, for all purposes, be the date on which the Board makes the
determination granting such Option or stock Purchase Right. Notice of the
determination shall be given to each Employee or Consultant to whom an
Option or Stock Purchase Right is so granted within a reasonable time after
the date of such grant.
13. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Administrator 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 Section 422 of the Code (or any other Applicable Laws or
regulation, the requirements of the NASD or an established stock
exchange), 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 or Stock Purchase Rights already
granted, and such Options and Stock Purchase Rights shall remain in
full force and effect as if this Plan had not been amended or
terminated, unless mutually agreed otherwise between the Optionee and
the Administrator, which agreement must be in writing and signed by
the Optionee and the Company.
14. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant to
the exercise of an Option or Stock Purchase Rights unless the exercise of
such Option or Stock Purchase Rights 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, 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 or Stock Purchase Right,
the Company may require the person exercising such Option or Stock Purchase
Right 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.
15. 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.
The 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.
16. Option, Stock Purchase and Stock Bonus Agreements. Options shall be
evidenced by written option agreements in such form as the Board shall
approve. Upon the exercise of Stock Purchase Rights, the Purchaser shall
sign a stock purchase agreement or stock bonus agreement in such form as
the Board shall approve.
17. Shareholder Approval. Continuance of the Plan shall be subject to approval
by the shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such shareholder approval shall be
obtained in the degree and manner required under Applicable Laws and the
rules of any stock exchange upon which the Common Stock is listed.
18. Information to Optionees and Purchasers. The Company shall provide to each
Optionee and Purchaser, during the period for which such Optionee or
Purchaser has one or more Options to Stock Purchase Rights outstanding, a
balance sheet and an income statement at least annually. The Company shall
not be required to provide such information to key employees whose duties
in connection with the Company assure there access to equivalent
information.