RF POWER PRODUCTS, INC.
1993 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
1. Purpose. RF Power Products, Inc. (the "Company")
hereby adopts the RF Power Products, Inc. 1993 Non-Employee
Directors Stock Option Plan (the "Plan"). The Plan is intended
to recognize the contributions made to the Company by the
non-employee members of the Board of Directors of the Company or
any Affiliate (as defined below), to provide such persons with
additional incentive to devote themselves to the future success
of the Company or an Affiliate, and to improve the ability of the
Company or an Affiliate to attract, retain, and motivate
individuals upon whom the Company's sustained growth and
financial success depend, by providing such persons with an
opportunity to acquire or increase their proprietary interest in
the Company through receipt of options to purchase the Company's
Common Stock, par value $ .01 per Share (the "Common Stock").
2. Definitions. Unless the context clearly indicates
otherwise, the following terms shall have the following meanings:
(a) "Affiliate" means a corporation which is a parent
corporation or a subsidiary corporation with respect to the
Company within the meaning of Section 424(e) or (f) of the Code.
(b) "Board of Directors" or "Board" means the Board of
Directors of the Company.
(c) "Change in Control" shall have the meaning as set forth
in Section 10 of the Plan.
(d) "Code" means the Internal Revenue Code of 1986, as
amended.
(e) "Committee" shall have the meaning set forth in Section
3 of the Plan.
(f) "Company" means RF Power Products, Inc., a Delaware
corporation.
(g) "Disability" shall have the meaning set forth in
Section 22(e)(3) of the Code.
(h) "Fair Market Value" shall have the meaning set forth in
Subsection 8(c) of the Plan.
(i) "Non-employee Director" means a member of the Board of
Directors who is not an employee of the Company or an Affiliate.
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(j) "Non-qualified Stock Option" means an Option granted
under the Plan which is not intended to qualify, or otherwise
does not qualify, as an "incentive stock option" within the
meaning of Section 422(b) of the Code.
(k) "Option" means a Non-qualified Stock Option granted
under the Plan.
(1) "Optionee" means a person to whom an Option has been
granted under the Plan, which Option has not been exercised and
has not expired or terminated.
(m) "Option Document" means the document described in
Section 8 of the Plan, as applicable, which sets forth the terms
and conditions of each grant of Options.
(n) "Option Price" means the price at which Shares may be
purchased upon exercise of an Option, as calculated pursuant to
Subsection 8(c) of the Plan.
(o) "Rule 16b-3" means Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended.
(p) "Shares" means the shares of Common Stock of the
Company which are the subject of Options.
3. Administration of the Plan. The Plan shall be
administered by the Board of Directors of the Company; however,
the Board of Directors may designate a committee composed of two
or more of its Non-employee Directors to operate and administer
the Plan in its stead.
(a) Meetings. The Committee shall hold meetings at such
times and places as it may determine. Acts approved at a meeting
by a majority of the members of the Committee or acts approved in
writing by the unanimous consent of the members of the Committee
shall be the valid acts of the Committee.
(b) Administration. The interpretation and construction by
the Committee of any provisions of the Plan or of any Option
granted under it shall be final, binding and conclusive.
(c) Exculpation. No member of the Board of Directors shall
be personally liable for monetary damages for any action taken or
any failure to take any action in connection with the
administration of the Plan or the granting of Options under the
Plan, provided that this
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Subsection 3(c) shall not apply to (i)
any breach of such member's duty of loyalty to the Company or its
stockholders, (ii) acts or omissions not in good faith or
involving intentional misconduct or a knowing violation of law,
(iii) acts or omissions that would result in liability under
Section 174 of the General Corporation Law of the State of
Delaware, as amended, and (iv) any transaction from which the
member derived an improper personal benefit.
(d) Indemnification. Service on the Committee shall
constitute service as a member of the Board of Directors of the
Company. Each member of the Committee shall be entitled without
further act on his or her part to indemnity from the Company to
the fullest extent provided by applicable law and the Company's
Certificate of Incorporation and/or By-laws in connection with or
arising out of any action, suit or proceeding with respect to the
administration of the Plan or the granting of Options thereunder
in which he or she may be involved by reason of his or her being
or having been a member of the Committee, whether or not he or
she continues to be such member of the Committee at the time of
the action, suit or proceeding.
(e) Limitations on Grants of Options to Consultants and
Advisors. With respect to the grant of Options to consultants or
advisors, bona fide services shall be rendered by consultants or
advisors and such services must not be in connection with the
offer or sale of securities in a capital-raising transaction.
4. Grants under the Plan. Grants under the Plan may only
be in the form of a Non-qualified Stock Option.
5. Eligibility. All Non-employee Directors shall be
eligible to receive Options hereunder. The Committee, in its
sole discretion, shall determine whether an individual is
eligible to receive Options under the Plan.
6. Shares Subject to Plan. The aggregate maximum number
of Shares for which Options may be granted pursuant to the Plan
will be increased to one hundred and ninety-five thousand
(195,000), subject to adjustment as provided in Section 10 of the
Plan. The Shares shall be issued from authorized and unissued
Common Stock or Common Stock held in or hereafter acquired for the
treasury of the Company. If an Option terminates or expires without
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having been fully exercised for any reason, the Shares
for which the Option was not exercised may again be the subject
of one or more Options granted pursuant to the Plan.
7. Term of the Plan. The Plan is effective as of March
24, 1993 the date on which it was adopted by the Board of
Directors, subject to the approval of the Plan on or before March
23, 1994 by a majority of the votes cast at a duly called meeting
of the stockholders at which a quorum representing a majority of
all outstanding voting stock of the Company is, either in person
or by proxy, present and voting. If the Plan is not so approved
on or before March 23, 1994, all Options granted under the Plan
shall be null and void. No Option may be granted under the Plan
after March 23, 2003.
8. Option Documents and Terms. Each Option granted under
the Plan shall be a Non-qualified Stock Option. Options granted
pursuant to the Plan shall be evidenced by the Option Documents
in such form as the Committee shall from time to time approve,
which Option Documents shall comply with and be subject to the
following terms and conditions and such other terms and
conditions as the Committee shall from time to time require which
are not inconsistent with the terms of the Plan.
(a) Number of Option Shares. Each Option Document shall
state the number of Shares to which it pertains. An Optionee may
receive more than one Option on the terms and subject to the
conditions and restrictions of the Plan.
(b) Timing of Grants, Number of Shares Subject to Options.
Each Non-Employee Director shall be granted automatically, in
accordance with the provisions of this Plan:
(i) upon appointment to the Board of Directors, an
Option to purchase fifteen thousand (15,000) Shares; and
(ii) annually, commencing on the last business day of
November 1995 and on the last business day of November
thereafter, an Option to purchase fifteen thousand (15,000)
Shares.
(c) Option Price. Each Option Document shall state the
Option Price which shall be equal to the Fair Market Value of the
Shares on the date the option is granted. If the Common
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Stock is traded in a public market, then the Fair Marker Value per share
shall be, if the Common Stock is listed on a national securities
exchange or included in the NASDAQ National Market System, the
last reported sale price thereof on the relevant date, or, if the
Common Stock is not so listed or included, the mean between the
last reported "bid" and "asked" prices thereof on the relevant
date, as reported on NASDAQ or, if not so reported, as reported
by the National Daily Quotation Bureau, Inc. or as reported in a
customary financial reporting service, as applicable and as the
Committee determines.
(d) Exercise. Each Option shall be exercisable six (6)
months after the date on which it was granted. No Option shall
be deemed to have been exercised prior to the receipt by the
Company of written notice of such exercise and payment in full of
the Option Price for the Shares to be purchased. Each such
notice shall specify the number of Shares to be purchased and
shall (unless the Shares are covered by a then current
registration statement or a Notification under Regulation A under
the Securities Act of 1933, as amended (the "Act")), contain the
Optionee's acknowledgment in form and substance satisfactory to
the Company that (a) such Shares are being purchased for
investment and not for distribution or resale (other than a
distribution or resale which, in the opinion of counsel
satisfactory to the Company, may be made without violating the
registration provisions of the Act), (b) the Optionee has been
advised and understands that (i) the Shares have not been
registered under the Act and are "restricted securities" within
the meaning of Rule 144 under the Act and are subject to
restrictions on transfer and (ii) the Company is under no
obligation to register the Shares under the Act or to take any
action which would make available to the Optionee any exemption
from such registration, (c) such Shares may not be transferred
without compliance with all applicable federal and state
securities laws, and (d) an appropriate legend referring to the
foregoing restrictions on transfer and any other restrictions
imposed under the Option Documents may be endorsed on the
certificates. Notwithstanding the foregoing, if the Company
determines that issuance of Shares should be delayed pending (A)
registration under federal or state securities laws, (B) the receipt
of an opinion of counsel acceptable to the Company that an appropriate
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exemption from such registration is available, (C)
the listing or inclusion of the Shares on any securities exchange
or an automated quotation system or (D) the consent or approval
of any governmental regulatory body whose consent or approval is
necessary in connection with the issuance of such Shares, the
Company may defer exercise of any Option granted hereunder until
any of the events described in this Subsection 8(d) has occurred.
(e) Medium of Payment. An Optionee shall pay for Shares
(i) in cash, (ii) by certified or cashier's check payable to the
order of the Company, or (iii) by such other mode of payment as
the Committee may approve, including payment through a broker in
accordance with procedures permitted by Regulation T of the
Federal Reserve Board. Without limiting the foregoing, the
Committee may provide an Option Document that payment may be made
in whole or in part in shares of the Company's Common Stock. If
payment is made in whole or in part in shares of the Company's
Common Stock, then the Optionee shall deliver to the Company
certificates registered in the name of such Optionee representing
the shares owned by such Optionee, free of all liens, claims and
encumbrances of every kind and having an aggregate Fair Market
Value on the date of delivery that is at least as great as the
Option Price of the Shares (or relevant portion thereof) with
respect to which such Option is to be exercised by the payment in
shares of Common Stock, accompanied by stock powers duly endorsed
in blank by the Optionee. In the event that certificates for
shares of the Company's Common Stock delivered to the Company
represent a number of shares in excess of the number of shares
required to make payment for the Option Price of the Shares (or
relevant portion thereof) with respect to which such Option is to
be exercised by payment in shares of Common Stock, the stock
certificate issued to the Optionee shall represent (i) the Shares
in respect of which payment is made, and (ii) such excess number
of shares. Notwithstanding the foregoing, the Committee may
impose from time to time such limitations and prohibitions on the
use of shares of the Common Stock to exercise an Option as it
deems appropriate.
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(f) Termination of Options.
All Options granted pursuant to this Plan shall be
exercisable until the first to occur of the following:
(i) Expiration of ten (10) years from the date of
grant;
(ii) Expiration of three months from the date the
Optionee's service as a Non-employee Director terminates for any
reason other than Disability or death; or
(iii) Expiration of one year from the date the
Optionee's service with Company as a Non-employee Director
terminates due to the Optionee's Disability or death.
(g) Transfers. No Option granted under the Plan may be
transferred, except by will or by the laws of descent and
distribution. During the lifetime of the person to whom an
Option is granted, such Option may be exercised only by such
person. Notwithstanding the foregoing, a Non-qualified Stock
Option may be transferred pursuant to the terms of a "qualified
domestic relations order," within the meaning of Sections
401(a)(13) and 414(p) of the Code or within the meaning of Title
I of the Employee Retirement Income Security Act of 1974, as
amended.
(h) Other Provisions. Subject to the provisions of the
Plan, the Option Documents shall contain such other provisions
including, without limitation, additional restrictions upon the
exercise of the Option or additional limitations upon the term of
the Option, as the Committee shall deem advisable.
(i) Amendment. Subject to the provisions of the Plan, the
Committee shall have the right to amend Option Documents issued
to an Optionee, subject to the Optionee's consent if such
amendment is not favorable to the Optionee, except that the
consent of the Optionee shall not be required for any amendment
made under Section 9 of the Plan, as applicable.
9. Change in Control. In the event of a Change in
Control, the Committee may take whatever action it deems
necessary or desirable with respect to the Options outstanding,
including, without limitation, accelerating the expiration or
termination date in the respective Option Documents to a date no
earlier than thirty (30) days after notice of such acceleration is
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given to the Optionees. In addition to the foregoing, in the
event of a Change in Control, Options granted pursuant to the
Plan shall become immediately exercisable in full.
A "Change of Control" shall be deemed to have occurred upon
the earliest to occur of the following events: (i) the date the
stockholders of the Company (or the Board of Directors, if
stockholder action is not required) approve a plan or other
arrangement pursuant to which the Company will be dissolved or
liquidated, or (ii) the date the stockholders of the Company (or
the Board of Directors, if stockholder action is not required)
approve a definitive agreement to sell or otherwise dispose of
substantially all of the assets of the Company, or (iii) the date
the stockholders of the Company (or the Board of Directors, if
stockholder action is not required) and the stockholders of the
other constituent corporation (or its board of directors if
stockholder action is not required) have approved a definitive
agreement to merge or consolidate the Company with or into such
other corporation, other than, in either case, a merger or
consolidation of the Company in which holders of shares of the
Company's Common Stock immediately prior to the merger or
consolidation will hold at least a majority of the ownership of
common stock of the surviving corporation (and, if one class of
common stock is not the only class of voting securities entitled
to vote on the election of directors of the surviving
corporation, a majority of the voting power of the surviving
corporation's voting securities) immediately after the merger or
consolidation, which common stock (and if applicable voting
securities) is to be held in the same proportion as such holders'
ownership of Common Stock of the Company immediately before the
merger or c onsolidation, or (iv) the date any entity, person or
group (within the meaning of Section 13(d)(3) or Section 14(d)(2)
of the Securities Exchange Act of 1934, as amended) other than
(A) the Company or any of its subsidiaries or any employee
benefit plan (or related trust) sponsored or maintained by the
Company or any of its subsidiaries; or (B) any person who, on the
date the Plan is effective, shall have been the beneficial owner
of or have voting control over shares of Common Stock of the
Company, possessing more than ten percent (10%) of the aggregate
voting power of the Company's Common Stock shall have become the
beneficial owner of, or shall have obtained voting control over,
more than ten percent (10%) of
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the outstanding shares of the
Company's Common Stock, or (v) the first day after the date this
Plan is effective when directors are elected such that a majority
of the Board of Directors shall have been members of the Board of
Directors for less than two (2) years, unless the nomination for
election of each new director who was not a director at the
beginning of such two (2) year period was approved by a vote of
at least two-thirds of the directors then still in office who
were directors at the beginning of such period.
Adjustments on Changes in Capitalization. The aggregate
number of Shares and class of shares as to which Options may be
granted hereunder, the number and class or classes of shares
covered by each outstanding Option and the Option Price thereof
shall be appropriately adjusted in the event of a stock dividend,
stock split, recapitalization or other change in the number or
class of issued and outstanding equity securities of the Company
resulting from a subdivision or consolidation of the Common Stock
and/or, if appropriate, other outstanding equity securities or a
recapitalization or other capital adjustment (not including the
issuance of Common Stock on the conversion of other securities of
the Company which are convertible into Common Stock) affecting
the Common Stock which is effected without receipt of
consideration by the Company. The Committee shall have authority
to determine the adjustments to be made under this Section, and
any such determination by the Committee shall be final, binding
and conclusive.
10. Amendment of the Plan. The Board of Directors of the
Company may amend the Plan from time to time in such manner as it
may deem advisable. The provisions of the Plan (i) which
directors shall be granted Options pursuant to Section 8; (ii)
the amount of Shares subject to Options granted pursuant to
Section 8; (iii) the price at which Shares subject to Options
granted pursuant to Section 8 may be purchased and (iv) the
timing of grants of Options pursuant to Section 8 shall not be
amended more than once every six months, other than to comport
with changes in the Code or the Employee Retirement Income
Security Act of 1974, as amended. No amendment to the Plan shall
adversely affect any outstanding Option, however, without the
consent of the Optionee that holds such Option. Notwithstanding
the foregoing, no amendment to or modification of the Plan that
(i) materially increases the benefits accruing to eligible
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individuals; (ii) except as provided in Section 10 of this Plan,
materially increases the number of shares that may be issued
under the Plan; or (iii) materially modifies the eligibility
requirements for participation under the Plan, shall be effective
without shareholder approval.
11. No Commitment to Retain. The grant of an Option
pursuant to the Plan shall not be construed to imply or to
constitute evidence of any agreement, express or implied, on the
part of the Company or any Affiliate to retain the Optionee as a
member of the Company's Board of Directors or in any other
capacity.
12. Withholding of Taxes. Whenever the Company proposes or
is required to deliver or transfer Shares in connection with the
exercise of an Option, the Company shall have the right to (a)
require the recipient to remit or otherwise make available to the
Company an amount sufficient to satisfy any federal, state and/or
local withholding tax requirements prior to the delivery or
transfer of any certificate or certificates for such Shares or
(b) take whatever other action it deems necessary to protect its
interests with respect to tax liabilities. The Company's
obligation to make any delivery or transfer of Shares shall be
conditioned on the Optionee's compliance, to the Company's
satisfaction, with any withholding requirement.
13. Interpretation. The Plan is intended to enable
transactions under the Plan with respect to directors and
officers (within the meaning of Section 16(a) under the
Securities Exchange Act of 1934, as amended) to satisfy the
conditions of Rule 16b-3; to the extent that any provision of the
Plan, or any provisions of any Option granted pursuant to the
Plan, would cause a conflict with such conditions or would cause
the administration of the Plan as provided in Section 3 to fail
to satisfy the conditions of Rule 16b-3, such provision shall be
deemed null and void to the extent permitted by applicable law.
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