EXHIBIT 10.1
CERTICOM CORP.
1997 STOCK OPTION PLAN
(AS AMENDED AS OF OCTOBER 19, 2000)
1. Purpose of the Plan
The purpose of the Plan is to encourage directors, officers and
employees of Certicom Corp. (the "Corporation") or any of its subsidiaries and
other persons:
(a) to promote the interests, growth and development of the
Corporation by providing them with the opportunity through share
options to acquire a proprietary interest in the Corporation;
(b) to recognize the contribution of such directors, officers,
employees and other persons; and
(c) to encourage such directors, officers, employees and other
persons to acquire Common Shares of the Corporation.
2. Definitions
In this Plan:
(a) "Associate" has the meaning assigned by the Securities Act
(Ontario), as amended from time to time;
(b) "Board of Directors" means the board of directors of the
Corporation;
(c) "Committee" means a committee appointed by the Board of Directors
and consisting of not less than three members of the Board of
Directors to administer the Plan. All references in the Plan to
the Committee means the Board of Directors if no Committee has
been appointed;
(d) "Common Shares" means the Common Shares of the Corporation or, in
the event of an adjustment contemplated in Section 9 hereof, such
other securities to which an Eligible Person may be entitled upon
the exercise of an Option as a result of such adjustment;
(e) "Date of Grant" means the date an Eligible Person is granted an
Option;
(f) "Director" means a person occupying the position of director on
the Board of Directors;
(g) "Eligible Persons" means any Director or Employee or any other
person or corporation approved by the Committee;
(h) "Employee" means an employee of the Corporation or its
subsidiaries;
(i) "Exchange" means The Toronto Stock Exchange or, if the Common
Shares are not then listed and posted for trading on The Toronto
Stock Exchange, on such stock exchange on which such shares are
listed and posted for trading as may be selected for such purpose
by the Committee;
(j) "Exercise Date" means the date the Corporation receives from the
Eligible Person a completed Stock Option Purchase Form with
payment for the Option Shares being purchased;
(k) "Insider" means:
(i) an insider of the Corporation as defined by the Securities
Act (Ontario) as amended from time to time, other than a
person who falls within such definition solely by virtue
of being a director or senior officer of a subsidiary of
the Corporation; and
(ii) an Associate of any person who is an Insider by virtue of
clause (i) of this definition;
(l) "Market Price" per Common Share at any date shall be the closing
price of the Common Shares on the Exchange (or, if the Common
Shares are not then listed and posted for trading on the
Exchange, on such stock exchange on which such shares are listed
and posted for trading as may be selected for such purpose by the
Committee) on the trading day immediately preceding the Date of
Grant. In the event that the Common Shares are not listed and
posted for trading on any stock exchange, the Market Price shall
be determined by the Committee in its sole discretion;
(m) "Option" means the right granted by the Corporation pursuant to
the Plan to purchase Common Shares;
(n) "Option Period" means the period set forth in Section 6 during
which an Eligible Person may purchase Option Shares;
(o) "Option Price" means the price per share at which an Eligible
Person may purchase Option Shares";
(p) "Option Shares" means the Common Shares of the Corporation which
an Eligible Person is entitled to purchase pursuant to an Option;
(q) "Outstanding Issue" means the number of Common Shares that are
outstanding immediately prior to any issuance of Options under
the Plan or any issuance of Option Shares, as the case may be,
excluding Option
Shares issued pursuant to the Plan and all other plans or stock
option agreements to which the Corporation may be a party during
the preceding one year period;
(r) "Participants" means Eligible Persons to whom Options are granted
pursuant to the Plan and which remain unexercised; and
(s) "Plan" means this Certicom Corp. 1997 Stock Option Plan.
3. Administration
(a) The Plan shall be administered by the Committee. The members of
the Committee shall serve at the pleasure of the Board and
vacancies occurring in the Committee shall be filled by the
Board.
(b) A majority of the members of the Committee shall constitute a
quorum and all actions of the Committee shall be taken by a
majority of the members present at any meeting. Any action of the
Committee may be taken by an instrument or instruments in writing
signed by all the members of the Committee, and any actions so
taken shall be as effective as if it had been passed by a
majority of the votes cast by the members of the Committee
present at a meeting of such members duly called and held.
(c) The Committee shall have the power, where consistent with the
general purpose and intent of the Plan and subject to the
specific provisions of the Plan:
(i) to establish policies and to adopt rules and regulations
for carrying out the purposes, provisions and
administration of the Plan;
(ii) to interpret and construe the Plan and to determine all
questions arising out of the Plan and any Option granted
pursuant to the Plan, and any such interpretation,
construction or termination made by the Committee shall
be final, binding and conclusive for all purposes;
(iii) to determine to which Eligible Persons Options are to be
granted and to grant Options;
(iv) to determine the number of Common Shares covered by each
Option;
(v) to determine the Option Price;
(vi) to determine the time or times when Options will be
granted and exercisable;
(vii) to determine if the Common Shares that are subject to an
Option will be subject to any restrictions upon the
exercise of such Option; and
(viii) to prescribe the form of the instruments relating to the
grant, exercise and other terms of Option Shares.
4. Number of Option Shares
The aggregate number of Option Shares which may be issued hereunder
shall not exceed 8,000,000. Option Shares in respect of which Options are not
exercised prior to expiry in accordance with the terms of the Plan shall be
available for subsequent grants of Options under the Plan. The following
restrictions shall also apply to the Plan and to all other plans or stock option
agreements to which the Company may be a party:
(i) no Participant together with such Participant's
Associates shall be issued, within any one year period, a
number of Option Shares which exceeds 5% of the
Outstanding Issue; and
(ii) the number of Option Shares reserved for issuance
pursuant to Options to any one Participant shall not
exceed 5% of the Outstanding Issue;
5. Price for Option Shares
The Committee shall advise each Participant designated to participate
in the Plan of the number of Option Shares such Participant is entitled to
purchase and the Option Price at which the Option Shares may be purchased and
the Option Period. The Option Price at which the Option Shares may be purchased
under the Plan shall be fixed by the Committee based upon the Market Price of
the Common Shares at the Date of the Grant.
6. Vesting
(a) The limitation period or periods and the vesting period or
periods during which Options or a portion thereof vests and may
be exercised by the Participant shall be determined by the
Committee and be consistent with the provisions of the Plan
provided, however, the limitation period or periods for exercise
and the vesting period or periods may not exceed 10 years from
the date of the granting of Options.
(b) If no specific determination is made by the Committee with
respect to any of the following matters, each Option shall,
subject to any other specific provisions of the Plan, contain the
following terms and conditions:
(i) the period during which an Option shall be exercisable
shall be 5 years from the date the Option is granted to
the Eligible Person; and
(ii) the Participant may not take up and pay for any of the
Common Shares covered by the Option until the expiry of a
12-month period following the date of the grant of the
Option, and thereafter, the Participant shall be entitled
to take up and pay for not more than 25% of the Common
Shares covered by the Option immediately following the
expiry of such 12-month period following the date of the
grant of the Option, and a further 2.083333% of the
Shares covered by the Option following the expiry of each
one-month period following the expiry of such 12-month
period from the date of the grant of the Option;
provided, however, the Participant shall have the right,
at any time or from time to time during the remainder of
the term of the Option, to purchase such number of Common
Shares subject to the Option that were purchasable, but
not purchased by him, during any period.
7. Payment
The Participant from time to time at any time during the Option Period,
may elect to purchase all or a portion of the Option Shares available for
purchase during the relevant Option Period by lump sum payment by delivering to
the Corporation at its registered office, a notice in writing which shall
specify the number of Option Shares the Participant desires to purchase and
shall be accompanied by payment in full of the purchase price for such Option
Shares. Payment can be made by cash, certified cheque, bank draft, money order
or the equivalent payable to the order of Certicom Corp.
8. Certificates
(a) Each Option granted hereunder shall be evidenced by a certificate,
substantially in the form of Schedule "A", issued by the
Corporation to each Participant specifying the number of Option
Shares, the Option Price and the Option Period.
(b) Upon exercise of an Option and payment in full of the purchase
price the Corporation shall cause to be delivered to the
Participant within a reasonable period of time a certificate or
certificates in the name of the Participant representing the
number of Option Shares the Participant has purchased.
9. Adjustment in Common Shares
(a) The number of Common Shares subject to the Plan, the number of
Common Shares available under Options granted and the Option
Price shall be adjusted automatically from time to time to
reflect adjustments in the number of Common Shares arising as a
result of subdivisions, stock dividends, consolidations or
reclassifications of the Common Shares or other relevant changes
in the authorized or issued capital of the Corporation. No
fractional Common Shares may be purchased or issued hereunder. If
a Participant is entitled to purchase a fraction of a Common
Share pursuant to an Option, such entitlement shall be rounded
down to the nearest whole number.
(b) In the case of a proposed merger or amalgamation of the
Corporation with one or more other corporations, the making of a
take-over bid (as defined in the Securities Act (Ontario)) for
any of the outstanding Common Shares, the sale or distribution of
all or substantially all of the Corporation's assets or a
proposed corporate arrangement or reorganization, the Board of
Directors may, in its absolute discretion, determine the manner
in which all unexercised Options granted under the Plan shall be
treated including, notwithstanding Section 16 hereof, changing
the Option Period.
10. Termination
(a) Subject to the provisions of Section 10(d) hereof, in the event
that an Employee's employment with the Corporation or any of its
subsidiaries is terminated during the Option Period or a Director
shall cease to be a Director for any reason other than death or
cause, the Participant may elect to purchase all or a portion of
the remaining Option Shares that have vested at the time such
employment is terminated or of ceasing to be a Director at any
time during the 90-day period following the date of termination
of employment or ceasing to be a director (but in no event, after
the expiration of the Option Period). For the purposes of the
Plan, the transfer of the Employee's employment to the
Corporation or to any subsidiary of the Corporation shall not be
considered a termination of employment and the Employee's rights
under the Option shall be the same as if such transfer had not
occurred.
(b) Subject to the provisions of Section 10(d) hereof, in the event
of the termination of the relationship of a Participant with the
Corporation or any of its subsidiaries for cause prior to the
expiry of all outstanding Options granted to such Participant,
all such Options shall terminate forthwith without further notice
to the Participant.
(c) Subject to the provisions of Section 10(d) hereof, in the event
the Participant dies during the Option Period, the Participant's
legal
representative will be permitted to exercise any previously
unexercised portion of an Option granted under the Plan prior to
the Participant's death and take delivery of all Option Shares
previously purchased but not delivered, at any time during the
180 day period following the death of the Participant (but in no
event after the expiration of the Option Period).
(d) At any time before or after the relevant period set forth in
Sections 10(a), (b) or (c), the Committee may extend such period
as it applies to any former Participant, to a date which shall
not be later than the expiration of the Option Period.
11. Transfer and Assignment
The Participant's rights under Options granted under the Plan are not
assignable or transferable by the Participant or subject to any other
alienation, sale, pledge or encumbrance by such Participant during the
Participant's lifetime and therefore the Options are exercisable during the
Participant's lifetime only by the Participant. The obligations of each
Participant shall be binding on his or her heirs, executors and administrators.
12. Employment and Board Position Non-Contractual
The granting of an Option to a Participant under the Plan does not
confer upon the Participant any right to continue in the employment of the
Corporation or any subsidiary of the Corporation or on the Board of Directors,
as the case may be, nor does it interfere in any way with the right of the
Participant or the Corporation to terminate the Participant's employment at any
time or shareholders right to elect directors.
13. Rights as Shareholders
The Participant shall not have any rights as a shareholder with respect
to Option Shares until full payment has been made to the Corporation and a share
certificate or share certificates have been duly issued.
14. Notices
All written notices to be given by the Participant to the Corporation
may be delivered personally or by registered mail, postage prepaid, addressed as
follows:
Certicom Corp.
25801 Industrial Boulevard
Hayward, California
U.S.A.
94545
Attention: Secretary
Any notice given by the Participant pursuant to the terms of the Option
shall not be effective until actually received by the Corporation at the above
address. Any notice to be given to the Participant shall be sufficiently given
if delivered personally or by postage prepaid mail to the last address of the
Participant on the records of the Corporation and shall be effective seven days
after mailing.
15. Corporate Action
Nothing contained in the Plan or in the Option shall be construed so as
to prevent the Corporation or any subsidiary of the Corporation from taking
corporate action which is deemed by the Corporation or the subsidiary to be
appropriate or in its best interest, whether or not such action would have an
adverse effect on the Plan.
16. Amendments
The Board of Directors shall have the right, in its sole discretion, to
alter, amend or discontinue the Plan from time to time and at any time. No such
amendment or discontinuation, however, may, without the consent of the
Participant, alter or impair his rights or increase his obligations under the
Plan. Any amendment to the Plan will require the prior approval of the Exchange
and may require the approval of the Corporation's shareholders.
17. Termination of Plan
Except as otherwise provided herein, options may be granted only within
the ten-year period from the date the Plan has been adopted by the Board of
Directors of the Corporation.
18. Governing Law
The Plan is established under the laws of the Province of Ontario and
the rights of all parties and the construction and effect of each provision of
the Plan shall be according to the laws of the Province of Ontario and the laws
of Canada applicable therein.
19. Government Regulations
The Corporation's obligation to issue and deliver Common Shares under
any Option is subject to:
(a) the satisfaction of all requirements under applicable securities
law in respect thereof and obtaining all regulatory approvals as
the Corporation shall determine to be necessary or advisable in
connection with the authorization, issuance or sale thereof;
(b) the admission of such Common Shares to listing on any stock
exchange on which Common Shares may then be listed; and
(c) the receipt from the Participant of such representations,
agreements and undertakings as to future dealings in such Common
Shares as the Corporation determines to be necessary or advisable
in order to safeguard against the violation of the securities law
of any jurisdiction.
In this connection, the Corporation shall take all reasonable steps to
obtain such approvals and registrations as may be necessary for the issuance of
such Common Shares in compliance with applicable securities law and for the
listing of such Common Shares on any stock exchange on which such Common Shares
are then listed.
20. Approvals
(a) The Plan shall be subject to acceptance by the Exchange and
compliance with all conditions imposed by the Exchange. Any
Options granted prior to such acceptance shall be conditional
upon such acceptance being given and any conditions complied with
and no such Options may be exercised unless such acceptance is
given and such conditions are complied with.
(b) The Plan shall also be subject to the approval of the
shareholders of the Corporation. Any Options granted prior to
such approval shall be conditional upon such approval being given
and no such Options may be exercised unless and until such
approval is given.
SCHEDULE "A"
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CERTIFICATE
Date of Grant: .
Certificate No.: .
This Certificate is issued to . (the "Participant") pursuant to the 1997 Stock
Option Plan of Certicom Corp. (the "Plan").
This Certificate evidences an option to purchase . Common Shares of Certicom
Corp. for the Option Price of $. per Optioned Share. The Option evidenced hereby
expires on .. The rights, privileges and obligations of the Participant under
this Option are subject to the provisions of the Plan.
CERTICOM CORP.
By: _______________________________ c/s
Name:
Title: