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Registrant's Amended and Restated Directors Stock Option Plan
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AQUAGENIX, INC.
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AMENDED AND RESTATED
DIRECTORS STOCK OPTION PLAN
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1. PURPOSE. The purpose of this Plan is to advance the interests of
AQUAGENIX, INC., a Delaware corporation (the "Company"), by providing an
additional incentive to attract and retain nonemployee directors through the
encouragement of stock ownership in the Company by such persons.
2. DEFINITIONS. As used herein, the following terms shall have the
meaning indicated:
(a) "Annual Meeting Date" shall mean the date of the annual
meeting of the Company's shareholders at which the Directors are elected.
(b) "Board" shall mean the Company's Board of Directors.
(c) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(d) "Committee" shall mean the directors stock option committee
appointed by the Board pursuant to Section 12 hereof or, if
not appointed, the Board.
(e) "Common Stock" shall mean the Common Stock, par value $.01 per
share, of the Company.
(f) "Company" shall refer to AQUAGENIX, INC., a Delaware
corporation.
(g) "Director" shall mean a member of the Board.
(h) "Disinterested Person" shall mean a Director who is not,
during the one year prior to his or her service as an administrator of this
Plan, or during such service, granted or awarded equity securities pursuant to
this Plan, except that:
a. participation in a formula plan meeting the conditions
in paragraph (c)(2)(ii) of Rule 16b-3 promulgated under the Securities Exchange
Act shall not disqualify a Director from being a Disinterested Person;
b. participation in an ongoing securities acquisition plan
meeting the conditions in paragraph (d)(2)(i) of Rule 16b-3 promulgated under
the Securities Exchange Act shall not disqualify a Director from being a
Disinterested Person; and
c. an election to receive an annual retainer fee in either
cash or an equivalent amount of securities, or partly in cash and partly in
securities, shall not disqualify a Director from being a Disinterested Person.
(i) "Eligible Director" means any person who is a member of the
Board and who is not an employee, full time or part time, of the Company. For
purposes of this Plan, a director who does not receive regular compensation from
the Company or its subsidiaries, other than directors' fees and reimbursement
for expenses, shall not be considered to be an employee of the Company, even if
such director is an officer of a subsidiary of the Company.
(j) "Fair Market Value" of the Common Stock on any date of
reference shall be the Closing Price on the business day immediately preceding
such date of the Common Stock; provided, that for purposes of grants made on the
Initial Grant Date to persons who are Eligible Directors on the Effective Date,
the term "Fair Market Value" shall mean the initial public offering price per
share of Common Stock. For this purpose, the Closing Price of the Common on any
business day shall be (i) if such Common Stock is listed or admitted for trading
on any United States national securities exchange, or if actual transactions are
otherwise reported on a consolidated transaction reporting system, the last
reported sale price of Common Stock on such exchange or reporting system, as
reported in any newspaper of general circulation, (ii) if the Common Stock is
quoted on the National Association of Securities Dealers Automated Quotations
System, or any similar system of automated dissemination of quotations of
securities prices in common use, the mean between the closing high bid and low
asked quotations for such day of the Common Stock on such system, or (iii) if
neither clause (i) or (ii) is applicable, the man between the high bid and low
asked quotations for the Common Stock as reported by the National Quotation
Bureau, Incorporated if at least two securities dealers have inserted both bid
and asked quotations for the Common Stock on at least five of the ten preceding
days.
(k) "Option" (when capitalized) shall mean any option granted
under this Plan.
(l) "Option Agreement" means the agreement between the Company and
the Optionee for the grant of an option.
(m) "Optionee" shall mean a person to whom a stock option is
granted under this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
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(n) "Parent" means a "parent corporation" as defined in Section
425(e) and (g) of the Code.
(o) "Plan" shall mean this Directors Stock Option Plan for the
Company.
(p) "Share(s)" shall mean a share or shares of the Common Stock.
(q) "Subsidiary" shall mean any corporation (other than the
Company) in any unbroken chain of corporations beginning with the Company if, at
the time of the granting of the Option, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing 50 percent or more
of the total combined voting power of all classes of stock in one of the other
corporations in such chain.
3. SHARES AND OPTIONS. Subject to Section 9 of this Plan, the Company
may grant to Optionees from time to time Options to purchase an aggregate of up
to Two Hundred and Fifty Thousand (250,000) Shares from authorized and unissued
Shares. If any Option granted under the Plan shall terminate, expire, or be
canceled or surrendered as to any Shares, new Options may thereafter be granted
covering such Shares.
4. CONDITIONS FOR GRANT OF OPTIONS. Upon the grant of each Option, the
Company and the Eligible Director shall enter into an Option Agreement, which
shall specify the grant date and the exercise price and shall include or
incorporate by reference the substance of this Plan and such other provisions
consistent with this Plan as the Committee may determine.
5. EXERCISE PRICE. The exercise price per Share of any Option shall be
the Fair Market Value of the Shares underlying such Option at the close of
business on the date such Option is granted.
6. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i)
the Company has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate exercise price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Committee or Board in its sole discretion have been
made for the Optionee's payment to the Company of the amount that is necessary
for the Company or Subsidiary employing the Optionee to withhold in accordance
with applicable Federal or state tax withholding requirements. The exercise
price of any Shares purchased shall be paid in cash, by certified or official
bank check or personal check, by money order, with Shares or by a combination of
the above. If the exercise price is paid in whole or in part with Shares, the
value of the Shares surrendered shall be their Fair Market Value on the date the
Option is exercised. No Optionee shall be deemed to be a holder of any Shares
subject to an Option unless and until a stock certificate or certificates for
such Shares are issued to such person(s) under the terms of the Plan. No
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adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights for which
the record date is prior to the date such stock certificate is issued, except as
expressly provided in Section 9 hereof.
7. EXERCISE SCHEDULE FOR OPTIONS. Subject to Section 8 of this Plan,
each Option granted hereunder shall be exercisable in two equal installments
each on the first and second anniversary date following the date of grant to an
Eligible Director. Thereafter, such option shall be exercisable in full. The
expiration date of an Option shall be five years from the date of grant of the
Option.
8. TERMINATION OF OPTION PERIOD.
(a) The unexercised portion of any Option shall automatically and
without notice terminate and become null and void on the date on which the
Optionee ceases to be a Director for any reason, except as provided in Section
8(b) of this Plan, including, but not limited to, by reason of (A) "Cause"
(which, for purposes of this Plan, shall mean the removal of the Optionee as a
Director by reason of any act of (a) fraud or intentional misrepresentation, or
(b) embezzlement, misappropriation, or conversion of assets or opportunities of
the Company or any Subsidiary) or (B) resignation.
(b) The unexercised portion of any Option shall automatically and
without notice terminate and become null and void sixty (60) days after the date
on which the Optionee ceases to be a Director by reason of death of the
Director.
(c) The Committee in its sole discretion may, by giving written
notice ("Cancellation Notice"), cancel any Option that remains unexercised on
the date of the consummation of any corporate transaction;
(i) if the shareholders of the Company shall approve a plan
of merger, consolidation, reorganization, liquidation or dissolution in which
the Company does not survive (unless the approved merger, consolidation,
reorganization, liquidation or dissolution is subsequently abandoned); or
(ii) if the shareholders of the Company shall approve a plan
for the sale, lease, exchange or other disposition of all or substantially all
the property and assets of the Company (unless such plan is subsequently
abandoned).
Any Cancellation Notice shall be given a reasonable period of time prior to the
proposed date of such cancellation and may be given either before or after
shareholder approval of such corporate transaction.
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9. ADJUSTMENT OF SHARES.
(a) If at any time while the Plan is in effect or unexercised
Options are outstanding, there shall be any increase or decrease in the number
of issued and outstanding Shares through the declaration of a stock dividend or
through any recapitalization resulting in a stock split-up, combination or
exchange of Shares, then and in such event;
(i) appropriate adjustment shall be made in the maximum
number of Shares available for grant under the Plan, so that the same percentage
of the Company's issued and outstanding Shares shall continue to be subject to
being so optioned; and
(ii) appropriate adjustment shall be made in the number of
Shares and the exercise price per Share thereof then subject to any outstanding
Option, so that the same percentage of the Company's issued and outstanding
Shares shall remain subject to purchase at the same aggregate exercise price.
(b) Subject to the specific terms of any Option, the Committee may
change the terms of Options outstanding under this Plan, with respect to the
exercise price or the number of Shares subject to the Options, or both, when, in
the Committee's sole discretion, such adjustments become appropriate by reason
of a corporate transaction described in Subsections 8(b)(i) or (ii) hereof.
(c) Except as otherwise expressly provided herein, the issuance by
the Company of shares of its capital stock of any class, or securities
convertible into shares of capital stock of any class, either in connection with
a direct sale or upon the exercise of rights or warrants to subscribe therefor,
or upon conversation of shares or obligations of the Company convertible into
such shares or other securities, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or exercise price of the
Shares then subject to outstanding Options granted under the Plan.
(d) Without limiting the generality of the foregoing, the
existence of outstanding Options granted under the Plan shall not affect in any
manner the right or power of the Company to make, authorize or consummate (i)
any or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business; (ii) any merger or
consolidation of the Company; (iii) any issue by the Company of debt securities,
or preferred or preference stock that would rank above the Shares subject to
outstanding Options; (iv) the dissolution or liquidation of the Company; (v) any
sale, transfer or assignment of all or any part of the assets or business of the
Company; or (vi) any other corporate act or proceeding, whether of a similar
character or otherwise.
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10. TRANSFERABILITY OF OPTIONS. Each Option shall provide that such
Option shall not be transferable by the Optionee otherwise than by will or the
laws of descent and distribution, and each Option shall be exercisable during
the Optionee's lifetime only by the Optionee.
11. ISSUANCE OF SHARES. As a condition of any sale or issuance of Shares
upon exercise of any Option, the Committee may require such agreements or
undertakings, if any, as the Committee may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:
(i) a representation and warranty by the Optionee to the
Company, at the time any Option is exercised, that he is acquiring the Shares to
be issued to him for investment and not with a view to, or for sale in
connection with, the distribution of any such Shares; and
(ii) a representation, warranty and/or agreement to be bound
by any legends that are, in the opinion of the Committee, necessary or
appropriate to comply with the provisions of any securities law deemed by the
Committee to be applicable to the issuance of the Shares and are endorsed upon
the Share certificates.
12. ADMINISTRATION OF THE PLAN.
The Plan shall be administered by the Committee, which shall consist
of one or more Directors as determined by the Board, each of whom shall be
Disinterested Persons. The Committee shall have all of the powers of the Board
with respect to the Plan. Any member of the Committee may be removed at any
time, with or without cause, by resolution of the Board and any vacancy
occurring in the membership of the Committee may be filled by appointment by the
Board.
The Committee, from time to time, may adopt rules and regulations
for carrying out the purposes of the Plan. The Committee's determinations and
its interpretation and construction of any provision of the Plan shall be final
and conclusive.
Any and all decisions or determinations of the Committee shall be
made either (i) by a majority vote of the members of the Committee at a meeting
or (ii) without a meeting by the unanimous written approval of the members of
the Committee.
13. INTERPRETATION. If any provision of the plan should be held invalid
or illegal for any reason, such determination shall not affect the remaining
provisions hereof, but instead the Plan shall be construed and enforced as if
such provision had never been included in the Plan. The determinations and the
interpretation and construction of any provision of the Plan by the Committee
shall be final and conclusive. This Plan shall be governed by the laws of the
State of Delaware. Headings contained in this Plan are for convenience only and
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shall in no manner be construed as part of this Plan. Any reference to the
masculine, feminine, or neuter gender shall be a reference to such other gender
as is appropriate.
14. TERM OF PLAN; AMENDMENT AND TERMINATION OF THE PLAN.
(a) This Plan shall become effective upon its adoption by the
Board, and shall continue in effect until all Options granted hereunder have
expired or been exercised, unless sooner terminated under the provisions
relating thereto. No Option shall be granted after ten years from the date of
the Board's adoption of this Plan.
(b) The Committee may from time to time amend the Plan or any
Option; PROVIDED, HOWEVER, that, without approval by the Company's shareholders,
no such amendment shall (i) materially increase the benefits accruing to
participants under the Plan, (ii) materially increase the number of Shares or
other securities reserved for issuance upon the exercise of Options, (iii)
materially modify the requirements as to eligibility for participation under the
Plan or (iv) otherwise involve any other change or modification requiring
shareholder approval under Rule 16b-3 of the Securities Act of 1933, as amended;
AND, PROVIDED, FURTHER, that, except to the extent otherwise specifically
provided in Section 8, no amendment or suspension of the Plan or any Option
issued hereunder shall substantially impair any Option previously granted to any
Optionee without the consent of such Optionee.
(c) Notwithstanding anything else contained herein, the provisions
of this Plan which govern the number of Options to be awarded to nonemployee
directors, the exercise price per share under each such Option, when and under
what circumstances an Option will be granted and the period within which each
Option may be exercised, shall not be amended more than once every six months
(even with shareholder approval), other than to conform to changes to the Code,
or the rules promulgated thereunder, and under the Employee Retirement Income
Security Act of 1974, as amended, or the rules promulgated thereunder, or with
rules promulgated by the Securities and Exchange Commission.
(d) The Committee, without further approval of the Company's
shareholders, may at any time terminate or suspend this Plan. Any such
termination or suspension of the Plan shall not affect Options already granted
and such Options shall remain in full force and effect as if this Plan had not
been terminated or suspended. No Option may be granted while the Plan is
suspended or after it is terminated. The rights and obligations under any Option
granted to any Optionee while this Plan is in effect shall not be altered or
impaired by the suspension or termination of this Plan without the consent of
such Optionee.
15. RESERVATION OF SHARES. The Company, during the term of the Plan,
will at all times reserve and keep available a number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
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