Exhibit 4.4
STATS CHIPPAC LTD.
SUBSTITUTE EQUITY INCENTIVE PLAN
1. Purposes of the Plan. Pursuant to that certain Agreement and Plan of
Merger and Reorganization, dated as of February 10, 2004 (the "Merger
Agreement"), among ST Assembly Test Services Ltd., a Singapore public company
limited by shares ("STATS"), Camelot Merger, Inc. and ChipPAC, Inc., a Delaware
corporation ("ChipPAC"), ChipPAC will become a wholly owned subsidiary of STATS.
Under the terms of the Merger Agreement STATS agreed to grant Substitute Options
(as hereinafter defined) in substitution for the Options (as hereinafter
defined) that were outstanding and unexercised immediately prior to the
Effective Time (as defined in the Merger Agreement) on substantially the same
terms in all material respects as were applicable to the Options that were
substituted with the Substitute Options. The Merger Agreement also provides for
the change of the name of the combined company, effective as of the Effective
Time, to "STATS ChipPAC Ltd." This STATS ChipPAC Ltd. Substitute Equity
Incentive Plan (the "Plan") of STATS ChipPAC Ltd., a Singapore public company
limited by shares (the "Company"), which is designed to provide for the grant of
Substitute Options to holders of Options in accordance with the terms of the
Merger Agreement, shall not become effective until the Effective Time.
2. Definitions. Unless otherwise defined herein, the following
definitions shall apply:
(a) "Administrator" means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.
(b) "Applicable Laws" means the requirements relating to the
administration of equity-based compensation plans under the laws of the
Republic of Singapore, U.S. state corporate laws, U.S. federal and state
securities laws, the Code, any stock exchange or quotation system on which
the Shares or ADSs are listed or quoted and the applicable laws of any
other country or jurisdiction where Substitute Options are, or will be,
granted under the Plan.
(c) "ADS" means an American Depositary Share issued pursuant to the
deposit agreement, dated as of February 8, 2000, as may be amended from
time to time, by and among STATS, Citibank, N.A., as depositary, and the
holders from time to time of ADSs (evidenced by American Depositary
Receipts). Each ADS represents the right to receive ten Shares.
(d) "Board" means the Board of Directors of the Company.
(e) "Change in Control" means the occurrence of any of the following
events following the Effective Time:
(i) When any "person" as defined in Section 3(a)(9) of the
Exchange Act and as used in Sections 13(d) and 14(d) thereof,
including a "group" as defined in Section 13(d) of the Exchange Act
but excluding the Company and any Subsidiary and any employee benefit
plan sponsored or maintained by the
Company or any Subsidiary (including any trustee of such plan acting
as trustee), directly or indirectly, becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act, as amended from time
to time), after the effective date of the Plan, of securities of the
Company representing 50 percent or more of the combined voting power
of the Company's then outstanding securities;
(ii) When, during any period of 24 consecutive months during the
existence of the Plan, the individuals who, at the beginning of such
period, constitute the Board (the "Incumbent Directors") cease for any
reason other than death to constitute at least a majority thereof,
provided, however, that a director who was not a director at the
beginning of such 24-month period shall be deemed to have satisfied
such 24-month requirement (and be an Incumbent Director) if such
director was elected by, or on the recommendation of or with the
approval of, at least two-thirds of the directors who then qualified
as Incumbent Directors either actually (because they were directors at
the beginning of such 24-month period) or by prior operation of this
provision; or
(iii) The approval by the shareholders of the Company of a
transaction involving the acquisition of the Company by an entity
other than the Company or a Subsidiary through purchase of assets, by
merger, or otherwise.
Anything in this Plan to the contrary notwithstanding, none of the
transactions contemplated in connection with the Merger Agreement shall
constitute a Change in Control under this Plan.
(f) "ChipPAC Board" means the board of directors of ChipPAC.
(g) "ChipPAC Share" means a share of class A common stock, par value
$0.01 per share, of ChipPAC.
(h) "Code" means the United States Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
(i) "Committee" means a committee appointed by the Board in accordance
with Section 4 of the Plan.
(j) "Consultant" means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary of the foregoing to render services
to such entity.
(k) "Director" means a person who was a member of the ChipPAC Board
during the period that the Former Plan was in effect and is appointed or
elected a member of the Board.
(l) "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Code.
(m) "Effective Time" has the meaning ascribed to it in Section 1
hereof.
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(n) "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A
Service Provider shall not cease to be an Employee in the case of (i) any
leave of absence approved by the Company (or the Parent or Subsidiary to
the extent the Employee was employed by either of these entities) or (ii)
transfers between locations of the Company or between the Company, its
Parent, any Subsidiary, or any successor. For purposes of Incentive Stock
Options, no such leave may exceed 90 days, unless reemployment upon
expiration of such leave is guaranteed by statute or contract. If
reemployment upon expiration of a leave of absence approved by the Company
(or the Parent or Subsidiary to the extent the Employee was employed by
either of these entities) is not so guaranteed, on the 181st day of such
leave any Incentive Stock Option held by the Optionee shall cease to be
treated as an Incentive Stock Option and shall be treated for tax purposes
as a Nonstatutory Stock Option. Neither service as a Director nor payment
of a Director's fee by the Company shall be sufficient to constitute
"employment" by the Company.
(o) "ESOP" means the STATS ChipPAC Ltd. Share Option Plan, as may be
amended from time to time.
(p) "Exchange Act" means the United States Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
(q) "Exchange Ratio" means the numeral 8.7.
(r) "Fair Market Value" means, as of any date, the value of Shares
determined as follows:
(i) If the Shares are listed on any established stock exchange or
a national market system, including, without limitation, The Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock
Market, the Fair Market Value shall be the closing sales price for the
Shares (or the closing bid, if no sales were reported) as quoted on
such exchange or system for the last market trading day prior to the
time of determination, as reported in The Wall Street Journal or such
other source as the Administrator deems reliable;
(ii) If the Shares are regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market
Value shall be the mean between the high bid and low asked prices for
the Shares on the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other
source as the Administrator deems reliable; or
(iii) In the absence of an established market for the Shares, the
Fair Market Value shall be determined in good faith by the
Administrator.
(s) "Former Plan" means the ChipPAC, Inc. 2000 Equity Incentive Plan.
(t) "Incentive Stock Option" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code, or a
Substitute Option
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granted in substitution for an Option that was granted as an Incentive
Stock Option, as applicable given the context.
(u) "Incumbent Directors" shall have the meaning set forth in Section
2(f)(2).
(v) "Nonstatutory Stock Option" means an Option or a Substitute
Option, as applicable given the context, not intended to qualify as an
Incentive Stock Option.
(w) "Notice of Grant" means a written or electronic notice evidencing
certain terms and conditions of an individual Option. The Notice of Grant
is part of the Option Agreement.
(x) "Officer" means a person who was an officer, within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder, of ChipPAC during the period that the Former Plan was in
effect, and who is an officer of the Company at the Effective Time.
(y) "Option" means an option to purchase ChipPAC Shares granted under
the Former Plan that is outstanding and unexercised immediately prior to
the Effective Time that shall be eligible for substitution with a
Substitute Option granted in accordance with the terms of this Plan.
(z) "Option Agreement" means an agreement between ChipPAC and an
Optionee evidencing the terms and conditions of an individual grant of an
Option. The Option Agreement is subject to the terms and conditions of the
Plan.
(aa) "Option Exchange Program" means a program designed in any
structure whereby outstanding Substitute Options are surrendered in
exchange for Substitute Options with a lower exercise price.
(bb) "Optioned Shares" means the Shares subject to a Substitute
Option.
(cc) "Optionee" means the holder of an outstanding Substitute Option
granted under the Plan.
(dd) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(ee) "Plan" means this STATS ChipPAC Ltd. Substitute Equity Incentive
Plan, as amended from time to time.
(ff) "Service Provider" means an Employee, Director or Consultant.
(gg) "Share" means an ordinary share of STATS ChipPAC Ltd., par value
S$0.25 per share.
(hh) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
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(ii) "Substitute Option" means an option granted pursuant to the terms
of the Plan in substitution for an Option and representing the right to
receive, upon exercise thereof, a number of Shares equal to the product of
the number of ChipPAC Shares subject to the Option substituted with the
Substitute Option, multiplied by the Exchange Ratio (rounded down to the
nearest whole Share).
(jj) "Substitute Option Notice" means the written or electronic notice
that shall be delivered to a holder of an Option informing the holder that
his or her Option shall be substituted with a Substitute Option and
providing information regarding the number of Shares for which the Option
is exercisable and the exercise price applicable to the Substitute Option.
The Substitute Option Notice shall become part of the Option Agreement and
shall supersede the applicable terms contained in the Notice of Grant and
Option Agreement entered into with the holder of the Option, including,
without limitation, the number of Shares subject to, and the exercise price
of, the Option, all as set forth in the Substitute Option Notice.
3. Shares Subject to the Plan. Subject to the provisions of Section 12
of the Plan, the maximum aggregate number of Shares that may be subject to
Substitute Options and sold under the Plan is approximately 73 million Shares,
which is an aggregate number that is intended to be equal to or greater than the
product of the aggregate number of ChipPAC Shares subject to all Options
outstanding and unexercised immediately prior to the Effective Time, multiplied
by the Exchange Ratio. If any Substitute Options expire unexercised or unpaid or
are canceled, terminated or forfeited in any manner without the issuance of
Shares or payment thereunder, the Shares with respect to which such Substitute
Options were granted shall become available for issuance pursuant to options or
other awards under the ESOP. In addition, Shares that are not made subject to
Substitute Options hereunder shall become available for issuance pursuant to
options or other awards under the ESOP. The Shares may be authorized, but
unissued Shares.
If a Substitute Option expires or becomes unexercisable without having
been exercised in full, or is surrendered pursuant to an Option Exchange
Program, the unpurchased Shares that were subject thereto shall become available
for future grant or sale under the ESOP; provided, however, that Shares that
have actually been issued under the Plan upon exercise of a Substitute Option
shall not be returned to the Plan and shall not become available for future
distribution 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 Service
Providers.
(ii) Other Administration. Other than as provided above, the
Former Plan and this Plan shall be administered by (A) the Board or
(B) a Committee, which committee shall be constituted to satisfy
Applicable Laws.
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(b) Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties
delegated by the Board to such Committee, the Administrator shall have the
authority, in its discretion:
(i) to determine the Fair Market Value, in accordance with
Section 2 (q) hereof;
(ii) to determine the number of Shares to be covered by each
Substitute Option granted hereunder in accordance with the provisions
of the Merger Agreement;
(iii) to approve forms of agreement and other documents for use
under the Plan;
(iv) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Substitute Option granted hereunder;
(v) to institute an Option Exchange Program;
(vi) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;
(vii) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to
sub-plans established for the purpose of qualifying for preferred tax
treatment under tax laws of jurisdictions other than in the United
States;
(viii) to modify or amend each Substitute Option (subject to
Section 14(c) of the Plan), including the discretionary authority to
extend the post-termination exercisability period of Substitute
Options longer than is otherwise provided for in the Plan;
(ix) to the extent permitted under Applicable Law, to allow
Optionees to satisfy withholding tax obligations by electing to have
the Company withhold from the Shares or ADSs to be issued upon
exercise of a Substitute Option 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;
(x) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of a Substitute Option
previously granted by the Administrator; and
(xi) to make all other determinations deemed necessary or
advisable for administering the Plan.
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(c) Effect of Administrator's Decision. The Administrator's decisions,
determinations and interpretations shall be final, binding and conclusive
on all Optionees and any other holders of Substitute Options.
5. Eligibility. Each holder of an Option shall be granted a Substitute
Option in accordance with the terms and conditions of this Plan, including the
terms set forth in the Substitute Option Notice.
6. Limitations.
(a) Each Option shall have been designated in the 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 Incentive Stock Options
are exercisable for the first time by the Optionee during any calendar year
(under all plans of the Company and any Parent or Subsidiary) exceeds
US$100,000, such Substitute Options shall be treated as Nonstatutory Stock
Options. For purposes of this Section 6(a), Incentive Stock Options shall
be taken into account in the order in which they were granted. The Fair
Market Value of the Shares shall be determined as of the time the Option
with respect to such Shares was granted.
(b) Neither the Plan nor any Substitute Option shall confer upon an
Optionee any right with respect to continuing the Optionee's relationship
as a Service Provider with the Company, nor shall they interfere in any way
with the Optionee's right or the Company's right to terminate such
relationship at any time, with or without cause.
7. Term of Plan. Subject to Section 18 hereof, the Plan shall become
effective upon approval by the shareholders of the Company of the Board adoption
of the Plan. It shall continue in effect for a term of the shorter of ten (10)
years and the period ending on the date that each Substitute Option has been
exercised, unless terminated earlier under Section 14 hereof.
8. Term of Substitute Option. The term of a Substitute Option shall be
the same term applicable to the Option substituted with the Substitute Option
and that is stated in the Option Agreement, subject to the limitations in this
Section 8. In the case of a Substitute Option substituted for an Option, which
was granted as an Incentive Stock Option, the term of the Substitute Option
shall be ten (10) years, measured from the date of grant of the Option so
substituted or such shorter term as may be provided in the Option Agreement. In
the case of a Substitute Option substituted for an Option, which was granted as
an Incentive Stock Option, to an Optionee who at the time of the grant of the
Option so substituted owned ChipPAC Shares representing more than ten percent
(10%) of the total combined voting power of all classes of shares of ChipPAC or
any Parent or Subsidiary of ChipPAC, the term of the Substitute Option shall be
five (5) years, measured from the date of grant of the Option so substituted or
such shorter term as may be provided in the Option Agreement. In the case of a
Substitute Option granted to a person who was not an Employee at the time of the
grant of the Substitute Option, the term of the Substitute Option shall be five
(5) years, measured from the date of grant of the Substitute Option or such
shorter term as may be provided in the Option Agreement.
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9. Substitute Option Exercise Price and Consideration.
(a) Substitute Option Exercise Price. The per Share exercise price of
a Substitute Option shall be equal to the quotient (rounded up to the
nearest cent) arrived at by dividing the per ChipPAC Share exercise price
applicable to the Option substituted with the Substitute Option, by the
Exchange Ratio; provided, however, that the per Share exercise price of a
Substitute Option shall in no event be less than the par value of a Share.
(b) Exercise Dates. Subject to Section 8 hereof, the Substitute Option
shall be exercisable at the same time and within the same periods
applicable to the Option that was substituted with the Substitute Option.
(c) Form of Consideration. The acceptable form of consideration for
exercising a Substitute Option, including the method of payment shall be
the same form of consideration and method of payment applicable to the
Option substituted with the Substitute Option. In the case of an Incentive
Stock Option, the Administrator shall have determined the acceptable form
of consideration at the time of grant. Such consideration may consist
entirely of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) to the extent permitted under Applicable Law, other Shares
which (A) in the case of Shares acquired upon exercise of a Substitute
Option, have been owned by the Optionee for more than six months on
the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to
which the Substitute Option shall be exercised;
(v) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the
Plan;
(vi) a reduction in the amount of any Company liability to the
Optionee, including any liability attributable to the Optionee's
participation in any Company-sponsored deferred compensation program
or arrangement;
(vii) any combination of the foregoing methods of payment; or
(viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.
10. Exercise of Substitute Option.
(a) Procedure for Exercise; Rights as a Shareholder. (i) Each
Substitute Option granted hereunder shall be exercisable according to the
terms of the Plan and at such
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times and under such conditions applicable to the Option substituted with
the Substitute Option and set forth in the Option Agreement. Unless the
Administrator provides otherwise, vesting of a Substitute Option granted
hereunder shall be tolled during any unpaid leave of absence. A Substitute
Option may not be exercised for a fraction of a Share.
(ii) A Substitute Option shall be deemed exercised when the
Company receives: (A) written or electronic notice of exercise (in
accordance with the Option Agreement) from the person entitled to
exercise the Substitute Option, and (B) full payment for the Shares
with respect to which the Substitute Option is exercised. Full payment
may consist of any consideration and method of payment authorized by
the Administrator and permitted by the Option Agreement and the Plan.
(iii) Anything in this Plan to the contrary notwithstanding, the
holder of a Substitute Option may elect to receive ADSs in lieu of
Shares upon the exercise of the Substitute Option, and upon such
election, the holder of the Substitute Option shall receive a number
of ADSs equal to the quotient that results from dividing the number of
Shares for which a Substitute Option is exercisable, by the number 10
(rounded down to the nearest whole ADS).
(iv) Shares or ADSs issued upon exercise of a Substitute Option
shall be issued in the name of the Optionee or, if requested by the
Optionee, in the name of the Optionee and his or her spouse. Until the
Shares or ADSs are issued (as evidenced by the appropriate entry on
the books of the Company or of a duly authorized transfer agent of the
Company), no right to vote or receive dividends or any other rights as
a shareholder shall exist with respect to the Optioned Shares,
notwithstanding the exercise of the Substitute Option. The Company
shall issue (or cause to be issued) such Shares or ADSs promptly after
the Substitute Option is exercised. No adjustment shall be made for a
dividend or other right for which the record date is prior to the date
the Shares or ADSs are issued, except as provided in Section 12
hereof.
(v) Exercising a Substitute Option in any manner shall decrease
the number of Shares thereafter available, both for purposes of the
Plan and for sale under the Substitute Option, by the number of Shares
as to which the Substitute Option is exercised.
(b) Termination of Relationship as a Service Provider. If an Optionee
ceases to be a Service Provider, other than upon the Optionee's death,
Disability or retirement, the Optionee may exercise his or her Substitute
Option within such period of time as is specified with respect to the
Option substituted with the Substitute Option and set forth in the Notice
of Grant to the extent that the Substitute Option is vested on the date of
termination (but in no event later than the expiration of the term of such
Substitute Option as set forth in the Option Agreement). In the absence of
a specified time in the Option Agreement, the Substitute Option shall
remain exercisable for 30 days following the Optionee's termination (unless
the Administrator determines a different length of
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time). If, on the date of termination, the Optionee is not vested as to his
or her entire Substitute Option, the Shares covered by the unvested portion
of the Substitute Option shall become available for issuance under the
ESOP. If, after termination, the Optionee does not exercise his or her
Substitute Option within the time specified by the Administrator, the
Substitute Option shall terminate, and the Shares covered by such
Substitute Option shall become available for issuance under the ESOP.
(c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may
exercise his or her Substitute Option within such period of time as is
specified with respect to the Option substituted with the Substitute Option
and set forth in the Notice of Grant to the extent the Substitute Option is
vested on the date of termination (but in no event later than the
expiration of the term of such Substitute Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Substitute Option shall remain exercisable for six months following the
Optionee's termination (unless the Administrator determines a different
length of time). If, on the date of termination, the Optionee is not vested
as to his or her entire Substitute Option, the Shares covered by the
unvested portion of the Substitute Option shall become available for
issuance under the ESOP. If, after termination, the Optionee does not
exercise his or her Substitute Option within the time specified herein, the
Substitute Option shall terminate, and the Shares covered by such
Substitute Option shall become available for issuance under the ESOP.
(d) Death of Optionee. If an Optionee dies while a Service Provider,
the Substitute Option may be exercised within such period of time as is
specified with respect to the Option substituted with the Substitute Option
and set forth in the Notice of Grant (but in no event later than the
expiration of the term of such Substitute Option as set forth in the Notice
of Grant), by the Optionee's estate or by a person who acquires the right
to exercise the Substitute Option by bequest or inheritance, but only to
the extent that the Substitute Option is vested on the date of death. In
the absence of a specified time in the Option Agreement, the Substitute
Option shall remain exercisable for six months following the Optionee's
termination (unless the Administrator determines a different length of
time). If, at the time of death, the Optionee is not vested as to his or
her entire Substitute Option, the Shares covered by the unvested portion of
the Substitute Option shall become available for issuance under the ESOP.
The Substitute Option may be exercised by the executor or administrator of
the Optionee's estate or, if none, by the person(s) entitled to exercise
the Substitute Option under the Optionee's will or the laws of descent or
distribution. If the Substitute Option is not so exercised within the time
specified herein, the Substitute Option shall terminate, and the Shares
covered by such Substitute Option shall become available for issuance under
the ESOP.
(e) Retirement of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's voluntary retirement, the Optionee
may exercise his or her Substitute Option within such period of time as is
specified with respect to the Option that is substituted with the
Substitute Option and set forth in the Notice of Grant to the extent the
Substitute Option is vested on the date of retirement (but in no event
later than the expiration of the term of such Substitute Option as set
forth in the Option Agreement). In the absence of a specified time in the
Option Agreement, the Substitute
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Option shall remain exercisable for 30 days following the Optionee's
retirement (unless the Administrator determines a different length of
time). If, on the date of retirement, the Optionee is not vested as to his
or her entire Substitute Option, the Shares covered by the unvested portion
of the Substitute Option shall become available for issuance under the
ESOP. If, after retirement, the Optionee does not exercise his or her
Substitute Option within the time specified herein, the Substitute Option
shall terminate, and the Shares covered by such Substitute Option shall
become available for issuance under the ESOP. This Section 10(e) shall only
apply to an Optionee who voluntarily retires from the Company or a
Subsidiary on or after the date on which such Optionee has attained the age
of 59 1/2. Notwithstanding anything in this Section 10(e) or an Option
Agreement to the contrary, if the Administrator determines in the good
faith exercise of its judgment that any Optionee who has retired engages in
any conduct detrimental to the Company, upon such determination by the
Administrator, such Substitute Option shall immediately and without further
action on the part of the Company, expire and become unexercisable. No
notice of such determination need be given to any Optionee in such
circumstance.
(f) Change in Control. In the event of a Change in Control, only if
provided in the Option Agreement with respect to the Options that was
substituted with a Substitute Option, any Substitute Option awarded under
this Plan to the extent not previously exercisable shall immediately become
fully exercisable. The Administrator in its sole discretion may direct the
Company to cash out all outstanding Substitute Options as of the date a
Change in Control occurs or such other date as the Administrator may
determine prior to the Change in Control.
(g) Buyout Provisions. The Administrator may at any time offer to buy
out for a payment in cash or Shares, or, in the sole discretion of the
Administrator, ADSs, a Substitute Option previously granted based on such
terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.
11. Non-Transferability of Substitute Options. Unless determined
otherwise by the Administrator, a Substitute Option 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 a
Substitute Option transferable to the extent permitted under Applicable Law,
such Substitute Option shall contain such additional terms and conditions, as
the Administrator deems appropriate.
12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of Shares covered by each
outstanding Substitute Option, and the number of Shares that have been
authorized for issuance under the Plan but as to which no Substitute
Options have yet been granted or that have been returned to the Plan upon
cancellation or expiration of a Substitute Option, as well as the price per
Share covered by each such outstanding Substitute Option, shall be
proportionately adjusted for
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any increase or decrease in the number of issued Shares or ADSs resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Shares or ADSs, or any other increase or decrease
in the number of issued Shares or ADSs effected without receipt of
consideration by the Company; provided, however, that 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 any class, or securities convertible into shares of
any class, shall affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of Shares subject to a Substitute
Option.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify
each Optionee as soon as practicable prior to the effective date of such
proposed transaction. The Administrator in its discretion may provide for
an Optionee to have the right to exercise his or her Substitute Option
until ten (10) days prior to such transaction as to all of the Optioned
Shares covered thereby, including Shares as to which the Substitute Option
would not otherwise be exercisable. In addition, the Administrator may
provide that any Company repurchase option applicable to any Shares
purchased upon exercise of a Substitute Option shall lapse as to all such
Shares, provided the proposed dissolution or liquidation takes place at the
time and in the manner contemplated. To the extent it has not been
previously exercised, a Substitute Option shall terminate immediately prior
to the consummation of such proposed action.
(c) Merger or Asset Sale. In the event of a merger of the Company with
or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Substitute Option shall be assumed or an
equivalent option or right substituted by the successor corporation or a
Parent or Subsidiary of the successor corporation. In the event that the
successor corporation refuses to assume or substitute for the Substitute
Option, the Optionee shall fully vest in and have the right to exercise the
Substitute Option as to all of the Optioned Shares, including Shares as to
which it would not otherwise be vested or exercisable. If a Substitute
Option becomes fully vested and exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Administrator
shall notify the Optionee in writing or electronically that the Substitute
Option shall be fully vested and exercisable for a period of fifteen (15)
days from the date of such notice, and the Substitute Option shall
terminate upon the expiration of such period. For the purposes of this
Section 12(c), the Substitute Option shall be considered assumed if,
following the merger or sale of assets, the Substitute Option or right
confers the right to purchase or receive, for each Share subject to the
Substitute Option immediately prior to the merger or sale of assets, the
consideration (whether stock, cash, or other securities or property)
received in the merger or sale of assets by holders of Shares 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 merger or sale of assets is not
solely common stock or ordinary shares of the successor corporation or its
Parent, the Administrator may, with
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the consent of the successor corporation, provide for the consideration to
be received upon the exercise of the Substitute Option, for each Share
subject to the Substitute Option, to be solely common stock or ordinary
shares of the successor corporation or its Parent equal in fair market
value to the per share consideration received by holders of Shares in the
merger or sale of assets.
13. Date of Grant. The date of grant of an Option and the Substitute
Option substituted therefor shall be, for all purposes except where noted
otherwise, the date on which the administrator of the Former Plan made the
determination granting the Option, or such other later date as determined by the
administrator of the Former Plan and set forth in the Option Agreement.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend, alter,
suspend or terminate the Plan.
(b) Shareholder Approval. The Company shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to
comply with Applicable Laws.
(c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any
Optionee, unless mutually agreed otherwise between the Optionee and the
Administrator, which agreement must be in writing and signed by the
Optionee and the Company. Termination of the Plan shall not affect the
Administrator's ability to exercise the powers granted to it hereunder with
respect to Substitute Options granted under the Plan prior to the date of
such termination.
15. Conditions Upon Issuance of Shares.
(a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of a Substitute Option unless the exercise of such Substitute
Option and the issuance and delivery of such Shares shall comply with
Applicable Laws and shall be further subject to the approval of counsel for
the Company with respect to such compliance.
(b) Investment Representations. As a condition to the exercise of a
Substitute Option, the Company may require the person exercising such
Substitute Option 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.
16. Inability to Obtain Authority. 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.
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17. Reservation of Shares. The Company, during the term of this Plan,
shall at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
18. Shareholder Approval. The adoption of the Plan shall be subject to
approval by the shareholders of the Company at the time that the transactions
contemplated by the Merger Agreement are subject to shareholder approval. Such
shareholder approval shall be obtained in the manner and to the degree required
under Applicable Laws. The Plan shall not become effective and no Substitute
Option shall be granted under the Plan in the event that the Plan is not
approved by the shareholders of the Company and in no event prior to the
Effective Time.
19. Governing Law. The validity, construction, interpretation,
administration and effect of the Plan shall be determined in accordance with
laws of the Republic of Singapore.
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