CIRRUS LOGIC, INC.
AMENDED 1987 STOCK OPTION PLAN
(as amended March 22, 1990, March 21, 1991,
April 7, 1992, February 23, 1993, May 25, 1993, May 5, 1994 and April 17, 1995)
1. Purposes of the Plan. The purposes of this Stock Option Plan are to
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attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to the Employees and Consultants
of the Company and to promote the success of the Company's business.
Options granted hereunder may be either Incentive Stock Options or
Nonstatutory Stock Options, at the discretion of the Board and as reflected in
the terms of the written option agreement. The Board may also grant Stock
Purchase Rights under this Plan.
2. Definitions. As used herein, the following definitions shall apply:
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(a) "Board" shall mean the Committee, if one has been appointed, or
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the Board of Directors of the Company, if no Committee is appointed.
(b) "Code" shall mean the Internal Revenue Code
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of 1986, as amended.
(c) "Committee" shall mean the Committee appointed by the Board of
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Directors in accordance with paragraph (a) of Section 5 of the Plan, if one is
appointed.
(d) "Common Stock" shall mean the Common Stock of the Company.
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(e) "Company" shall mean Cirrus Logic, Inc., a California corporation.
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(f) "Consultant" shall mean any person who is engaged by the Company
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or any subsidiary to render consulting services and is compensated for such
consulting services, and any director of the Company whether compensated for
such services or not; provided that if and in the event the Company registers
any class of any equity security pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended ( the "Exchange Act"), the term Consultant
shall thereafter not include directors who are not compensated for their
services or are paid only a director's fee by the Company.
(g) "Continuous Status as an Employee or Consultant" shall mean the
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absence of any interruption or termination of service as an Employee or
Consultant. Continuous Status as an Employee or Consultant shall not be
considered interrupted in the case of sick leave, military leave, or any other
leave of absence approved by the Board;
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provided that such leave is for a period of not more than 90 days or
reemployment upon the expiration of such leave is guaranteed by contract or
statute.
(h) "Employee" shall mean any person, including officers and
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directors, employed by the Company or any Parent or Subsidiary of the Company.
The payment of a director's fee by the Company shall not be sufficient to
constitute "employment" by the Company.
(i) "Incentive Stock Option" shall mean an Option intended to qualify
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an an incentive stock option within the meaning of Section 422A of the Code.
(j) "Nonstatutory Stock Option" shall mean an Option not intended to
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qualify an an Incentive Stock Option.
(k) "Stock Purchase Right" shall mean a right to purchase Common
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Stock pursuant to Section 10 of the Plan.
(l) "Option" shall mean a stock option granted pursuant to the Plan.
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(m) "Optioned Stock" shall mean the Common Stock subject to an Option.
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(n) "Optionee" shall mean an Employee or Consultant who received an
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Option.
(o) "Parent" shall mean a "parent corporation", whether now or
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hereafter existing, as defined in Section 425(e) of the Code.
(p) "Plan" shall mean this 1987 Stock Option Plan.
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(q) "Share" shall mean a share of the Common Stock, as adjusted in
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accordance with Section 13 of the Plan.
(r) "Subsidiary" shall mean a "subsidiary corporation", whether now or
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hereafter existing, as defined in Section 425(f) of the Code.
3. Grant Limitations. The following limitations shall apply to grants
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of Options to Employees:
(a) No Employee shall be granted, in any fiscal year of the Company,
Options to purchase more than 400,000 shares.
(b) In connection with his or her initial employment, an Employee may
be granted Options to purchase up to an additional 800,000 shares, which shall
not count against the limit set forth in subsection (a) above.
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(c) The foregoing limitation shall be adjusted proportionately in
connection with any change in the Company's capitalization as described in
Section 13.
(d) If an Option is canceled (other than in connection with a
transaction described in Section 13), the canceled Option will be counted
against the limit set forth in Section 3. For this purpose, if the exercise
price of an Option is reduced, the transaction will be treated as a cancellation
of the Option and the grant of a new Option.
4. Stock Subject to the Plan. Subject to the provisions of Section 11 of
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the Plan, the maximum aggregate number of shares which may be optioned and sold
under the Plan is 9,122,444 shares of Common Stock. The Shares may be
authorized, but unissued, or reaquired Common Stock.
If an Option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were subject
thereto shall, unless the Plan shall have been terminated, become available for
future grant under the Plan. Notwithstanding any other provision of the Plan,
shares issued under the Plan and later repurchased by the Company shall not
become available for future grant or sale under the Plan.
5. Administration of the Plan.
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(a) Procedure. The Plan shall be administered by the Board of
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Directors of the Company.
(i) Subject to subparagraph (ii), the Board of Directors
may appoint a Committee consisting of not less than two members of the Board of
Directors to administer the Plan on behalf of the Board of Directors, subject to
such terms and conditions as the Board of Directors may prescribe. Once
appointed, the Committee shall continue to serve until otherwise directed by the
Board of Directors. Members of the Board who are either eligible for Options or
have been granted Options or Stock Purchase Rights may vote on any matters
affecting the administration of the Plan or the grant of any Options or Stock
Purchase Rights pursuant to the Plan, except that no such member shall act upon
the granting of an Option or Stock Purchase Right to himself, but any such
member may be counted in determining the existence of a quorum at any meeting of
the Board during which action is taken with respect to the granting of Options
or Stock Purchase Rights to him.
(ii) Notwithstanding the foregoing subparagraph (i), if and
in any event the Company registers any class of any equity security pursuant to
Section 12 of the Exchange Act, from the effective date of such registration
until six months after the termination of such registration, any grants of
Options or Stock Purchase Rights to officers or directors shall only be made by
the Board of Directors; provided, however, that if a majority of the Board of
Directors is eligible to participate in this Plan or any other stock
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option or other stock plan of the Company or any of its affiliates, or has been
eligible at any time within the preceding year, any grants of Options or Stock
Purchase Rights to directors must be made by, or only in accordance with the
recommendation of, a Committee consisting of three or more persons, who may but
need not be directors or employees of the Company, appointed by the Board of
Directors and having full authority to act in the matter, none of whom is
eligible to participate in this Plan or any other stock option or other stock
plan of the Company or any of its affiliates, or has been eligible at any time
within the preceding year. Any Committee administering the Plan with respect to
grants to officers who are not also directors shall conform to the requirements
of the preceding sentence. Once appointed, the Committee shall continue to serve
until otherwise directed by the Board of Directors.
(iii) Subject to the foregoing subparagraphs (i) and (ii),
from time to time the Board of Directors may increase the size of the Committee
and appoint additional members thereof, remove members (with or without cause)
and appoint new members in substitution therefor, fill vacancies however caused,
or remove all members of the Committee and thereafter directly administer the
Plan.
(b) Powers of the Board. Subject to the provisions of the Plan,
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the Board shall have the authority, in its discretion: (i) to grant Incentive
Stock Options, Nonstatutory Stock Options or Stock Purchase Rights; (ii) to
determine, upon review of relevant information and in accordance with Section
9(b) of the Plan, the fair market value of the Common Stock; (iii) to determine
the exercise price per share of Options and Stock Purchase Rights to be granted,
which exercise price shall be determined in accordance with Section 9(a) of the
Plan; (iv) to determine the Employees or Consultants to whom and the time or
times at which, Options or Stock Purchase Rights shall be granted and the number
of shares to be represented by each Option or Stock Purchase Right; (v) to
interpret the Plan; (vi) to prescribe, amend and rescind rules and regulations
relating to the Plan; (vii) to determine the terms and provisions of each Option
or Stock Purchase Right granted (which need not be identical) and, with the
consent of the holder thereof, modify or amend each Option or Stock Purchase
Right; (viii) to accelerate or defer (with the consent of the Optionee) the
exercise date of any Option, consistent with the provisions of Section 6 of the
Plan; (ix) to authorize any person to execute on behalf of the Company any
instrument required to effectuate the grant of an Option previously granted by
the Board; and (x) to make all other determinations deemed necessary or
advisable for the administration of the Plan.
(c) Effect of Board's Decision. All Decisions, determinations and
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interpretations of the Board shall be final and binding on all Optionees and
Stock Purchase Rights holders and any other holders of any Options or Stock
Purchase Rights granted under the Plan.
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6. Eligibility.
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(a) Nonstatutory Stock Options and Stock Purchase Rights may be
granted only to Employees and Consultants. Incentive Stock Options may be
granted only to Employees. An Employee or Consultant who has been granted an
Option or Stock Purchase Right may, if he is otherwise eligible, be granted one
or more additional Options or Stock Purchase Rights.
(b) No Incentive Stock Option may be granted to an Employee which,
when aggregated with all other incentive stock options granted to such Employee
by the Company or any Parent or Subsidiary, would result in Shares having an
aggregate fair market value (determined for each Share as of the date of grant
of the Option covering such Share) in excess of $100,000 becoming first
available for purchase upon exercise of one or more incentive stock options
during any calendar year.
(c) Section 6(b) of the Plan shall apply only to an Incentive Stock
Option evidenced by an "Incentive Stock Option Agreement" which sets forth the
intention of the Company and the Optionee that such Option shall qualify as an
incentive stock option. Section 6(b) of the Plan shall not apply to any Option
evidenced by a "Nonstatutory Stock Option Agreement" which sets forth the
intention of the Company and the Optionee that such Option shall be a
Nonstatutory Stock Option.
(d) The Plan shall not confer upon any Optionee, Purchaser or
holder of a Stock Purchase Right any right with respect to continuation of
employment or consulting relationship with the Company, nor shall it interfere
in any way with his right or the Company's right to terminate his employment or
consulting relationship at any time.
7. Term of Plan. The Plan shall become effective upon the earlier to occur
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of its adoption by the Board of Directors or its approval by the shareholders of
the Company as described in Section 19 of the Plan. It shall continue in effect
for a term of 10 years unless sooner terminated under Section 15 of the Plan.
8. Term of Option or Stock Purchase Right. The term of each Incentive
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Stock Option shall be 10 years from the date of grant thereof or such
shorter term as may be provided in the Incentive Stock Option Agreement. The
term of each Nonstatutory Stock Option shall be 10 years and 1 day from the date
of grant thereof or such shorter term as may be provided in the Nonstatutory
Stock Option Agreement. However, in the case of an Option granted to an
Optionee who, at the time the Option is granted, owns stock representing more
than 10% of the voting power of all classes of stock of the Company or any
Parent or Subsidiary, (a) if the Option is an Incentive Stick Option, the term
of the Option shall be 5 years from the date of grant thereof or such shorter
term as may be provided in the Incentive Stock Option Agreement, or (b) if the
Option is a Nonstatutory Stock Option, the term of the Option shall be 5 years
and 1 day from the date of grant thereof or such shorter term as may be provided
in the Nonstatutory Stock Option
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Agreement. The term of each Stock Purchase Right shall be as provided in
Section 11 of the Plan.
9. Exercise Price and Consideration.
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(a) The per Share exercise price for the Shares to be issued pursuant
to exercise of an Option or Stock Purchase Right shall be such price as is
determined by the Board, but shall be subject to the following:
(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the time of the grant of
such Incentive Stock Option, owns stock representing more than 10% of the voting
power of all classes of stock of the Company or any Parent or Subsidiary, the
per Share exercise price shall be no less than 100% of the fair market value per
Share on the date of grant.
(B) granted to any Employee, the per Share exercise price
shall be no less than 100% of the fair market value per Share on the date of
grant.
(ii) In the case of a Nonstatutory Stock Option or Stock Purchase
Right
(A) granted to a person who, at the time of the grant of such
Option or Stock Purchase Right, owns stock representing more than 10% of the
voting power of all classes of stock of the Company or any Parent or Subsidiary,
the per Share exercise price shall be no less than 100% of the fair market value
per Share on the date of the grant.
(B) granted to any person, the per Share exercise price shall
be no less than 85% of the fair market value per Share on the date of grant.
(iii) In the case of an Option or Stock Purchase Right granted on or
after the effective date of registration of any class of equity security of the
Company pursuant to Section 12 of the Exchange Act and prior to six months after
the termination of such registration, the per Share exercise price shall be no
less than 100% of the fair market value per Share on the date of grant.
(b) The fair market value shall be determined by the Board in its
discretion; provided, however, that where there is a public market for the
Common Stock, the fair market value per Share shall be the mean of the bid and
asked prices (or the closing price per share if the Common Stock is listed on
the National Association of Securities Dealers Automated Quotation ("NASDAQ")
National Market System) of the Common Stock for the date of grant, as reported
in the Wall Street Journal (or, if not so reported, as otherwise reported by the
NASDAQ System) or, in the event the Common Stock is listed on
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a stock exchange, the fair market value per Share shall be the closing price on
such exchange on the date of grant of the Option or Stock Purchase Right, as
reported in the Wall Street Journal.
(c) The consideration to be paid for the Shares to be issued upon
exercise of an Option or Stock Purchase Right, including the method of payment,
shall be determined by the Board and may consist entirely of cash, check,
promissory note, other Shares of Common Stock having a fair market value on the
date of surrender equal to the aggregate exercise price of the Shares as to
which said Option or Stock Purchase Right shall be exercised, or any combination
of such methods of payment, or such other consideration and method of payment
for the issuance of Shares to the extent permitted under Sections 408 and 409 of
the California General Corporation Law. In making its determination as to the
type of consideration to accept, the Board shall consider if acceptance of such
consideration may be reasonably expected to benefit the Company (Section 315(b)
of the California General Corporation Law).
10. Exercise of Option.
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(a) Procedure for Exercise; Rights as a Shareholder. Any Option
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granted hereunder shall be exercisable at such times and under such conditions
as determined by the Board, including performance criteria with respect to the
Company and/or the Optionee, and as shall be permissible under the terms of the
Plan; provided, however, that an Incentive Stock Option granted prior to January
1, 1987 (the "Sequential Option") shall not be exercisable while there is
outstanding any Incentive Stock Option which was granted, before the granting of
the Sequential Option, the the same Optionee to purchase stock of the Company,
any Parent or Subsidiary, or any predecessor corporation of such corporations.
For purposes of this provision, an Incentive Stock Option shall be treated as
outstanding until such option is exercised in full or expires by reason of lapse
of time.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Board, consist of any
consideration and method of payment allowable under Section 8(c) of the Plan.
Until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a shareholder shall exist with respect to the Optioned Stock,
notwithstanding the exercise of the Option. The Company shall issue (or cause
to be issued) such stock certificate promptly upon exercise of the Option. No
adjustment will be made for a dividend or other right for which the record date
is prior to the date the stock certificate is issued, except as provided in
Section 13 of the Plan.
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Exercise of an Option in any manner shall result in a decease in the
number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(b) Termination of Status as an Employee or Consultant. In the event
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of termination of an Optionee's Continuous Status as an Employee or Consultant
(as the case may be), such Optionee may, but only within 30 days (or such other
period of time, not exceeding 3 months in the case of an Incentive Stock Option
or 6 months in the case of a Nonstatutory Stock Option, as is determined by the
Board, with such determination in the case of an Incentive Stock Option being
made at the time of grant of the Option) after the date of such termination (but
in no event later than the date of expiration of the term of such Option as set
forth in the Option Agreement), exercise his Option to the extent that he was
entitled to exercise it at the date of such termination. To the extent that he
was not entitled to exercise the Option at the date of such termination, or if
he does not exercise such Option (which he was entitled to exercise) within the
time specified herein, the Option shall terminate.
(c) Disability of Optionee. Notwithstanding the provisions of Section
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10(b) above, in the event of termination of an Optionee's Continuous Status as
an Employee or Consultant as a result of his total and permanent disability (as
defined in Section 22(e)(3) of the Code), he may, but only within 3 months (or
such other period of time not exceeding 12 months as is determined by the
Board, with such determination in the case of an Incentive Stock Option being
made at the time of grant of the Option) from the date of such termination (but
in no event later than the date of expiration of the term of such Option as set
forth in the Option Agreement), exercise his Option to the extent he was
entitled to exercise it at the date of such termination. To the extent that he
was not entitled to exercise the Option at the date of termination, or if he
does not exercise such Option (which he was entitled to exercise) within the
time specified herein, the Option shall terminate.
(d) Death of Optionee. In the event of the death of an Optionee:
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(i) during the term of the Option who is at the time of his death
an Employee or Consultant of the Company and who shall have been in Continuous
Status as an Employee or Consultant since the date of grant of the Option, the
Option may be exercised, at any time within 12 months following the date of
death (but in no event later than the date of expiration of the term of such
Option as set forth in the Option Agreement), by the Optionee's estate or by a
person who acquired the right to exercise the Option by bequest or inheritance,
but only to the extent of the right to exercise that would have accrued had the
Optionee continued living and remained in Continuous Status as an Employee or
Consultant twelve (12) months after the date of death, subject to the limitation
set forth in Section 5(b); or
(ii) within 30 days (or such other period of time not exceeding 3
months as determined by the Board, with such determination in the case of an
Incentive
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Stock Option being made at the time of grant of the Option) after the
termination of Continuous Status as an Employee or Consultant,, the Option may
be exercised, at any time within 10 months following the date of death (but in
no event later than the date of expiration of the term of such Option as set
forth in the Option Agreement), by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to
the extent of the right to exercise that had accrued at the date of termination.
11. Stock Purchase Rights.
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(a) Rights to Purchase. After the Board of Directors determines that
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it will offer an Employee or Consultant the right to purchase Shares under the
Plan, it shall advise the offeree in writing of the terms, conditions and
restrictions relating to the offer, including the number of Shares that such
person shall be entitled to purchase, and the time within which such person must
accept such offer, which shall in no event exceed 90 days from the date upon
which the Board of Directors or its Committee made the determination to grant
the Stock Purchase Right. The offer shall be accepted by execution of a
Restricted Stock Purchase Agreement in the form determined by the Board of
Directors.
(b) Issuance of Shares. Forthwith after payment therefor, the Shares
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purchased shall be duly issued; provided, however, that the Board may require
that the Purchaser make adequate provision for any Federal and State
withholding obligations of the Company as a condition to such purchase.
(c) Repurchase Option. Unless the Board of Directors or its
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Committee determines otherwise, the Restricted Stock Purchase Agreement shall
grant the Company a repurchase option exercisable upon the voluntary or
involuntary termination of the Purchaser's employment with the Company for any
reason (including death or disability). The purchase price for shares
repurchased pursuant to the Restricted Stock Purchase Agreement shall be the
original price paid by the Purchaser and may be paid by cancellation of any
indebtedness of the Purchaser to the Company. The repurchase option shall lapse
at such a rate as the Board of Directors may determine.
(d) Other Provisions. The Restricted Stock Purchase Agreement shall
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contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Board of Directors.
(e) Rights as a Shareholder. Until the issuance (as evidenced by the
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appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing the shares as to which
a Stock Purchase right has been exercised, no right to vote or to receive
dividends or any other rights as a stockholder shall exist with respect to
shares of Common Stock subject to a Stock Purchase Right, notwithstanding the
exercise of a Stock Purchase Right. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock certificate
is issued, except as provided in Section 13 of the Plan.
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(f) Shares Available Under the Plan. Exercise of a Stock Purchase
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Right in any manner shall result in a decrease in the number of Shares that the
reafter shall be available for reissuance under the Plan.
12. Non-Transferability of Options and Stock Purchase Rights. Options
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and Stock Purchase rights 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 or holder of a Stock Purchase Right, only by the Optionee or holder of
a Stock Purchase Right.
13. Adjustments Upon Changes in Capitalization or Merger.
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Subject to any required action by the shareholders of the Company, the
number of shares of Common Stock covered by each outstanding Option and Stock
Purchase Right, and the number of shares of Common Stock which have been
authorized for issuance under the Plan but as to which no Options or Stock
Purchase Rights have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase right, as well as
the price per share of Common Stock covered by each such outstanding Option or
Stock Purchase right, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
shares of Common Stock effected without receipt of consideration by the Company;
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 stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
of Common Stock subject to an Option or Stock Purchase Right.
In the event of the proposed dissolution or liquidation of the
Company, the Option or Stock Purchase Right will terminate immediately prior to
the consummation of such proposed action, unless otherwise provided by the
Board. The Board may, in the exercise of its sole discretion in such instances,
declare that any Option or Stock Purchase right shall terminate as of a date
fixed by the Board and give each Optionee or holder of a Stock Purchase Right
the right to exercise his Option or Stock Purchase Right as to all or any part
of the Common Stock subject to such Option or Stock Purchase Right, including
Shares as to which the Option or Stock Purchase Right would not otherwise be
exercisable. In the event of a proposed sale of all or substantially all of the
assets of the Company, or the merger of the Company with or into another
corporation, the Options and Stock Purchase Rights shall be assumed or an
equivalent Option or Stock Purchase Right shall be substituted by such successor
corporation or a parent or subsidiary of such successor corporation, unless the
Board determines, in the exercise of its sold discretion and in lieu of such
assumption or substitution, that the Optionee or holder of Stock Purchase Right
shall
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have the right to exercise the Option or Stock Purchase Right as to all of
the Common Stock, including Shares as to which the Option or Stock Purchase
Right would not otherwise be exercisable. If the Board makes an Option or Stock
Purchase Right fully exercisable in lieu of assumption or substitution in the
event of a merger or sale of assets, the Board shall notify the Optionee or
holder of a Stock Purchase Right that the Option shall be fully exercisable for
a period of 15 days from the date of such notice, and the Option or Stock
Purchase Right will terminate upon the expiration of such period.
14. Time of Granting Options and Stock Purchase Rights. The date of
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grant of an Option or Stock Purchase right shall, for all purposes, be the date
on which the Board makes the determination granting such Option or Stock
Purchase Right. Notice of the determination shall be given to each Employee or
Consultant to whom an Option or Stock Purchase Right is so granted within a
reasonable time after the date of such grant.
15. Amendment and Termination of the Plan.
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(a) Amendment and Termination. The Board may amend or terminate the
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Plan from time to time in such respects as the Board may deem advisable;
provided that, any increase in the number of Shares subject to the Plan, other
than in connection with an adjustment under Section 13 of the Plan, shall
require shareholder approval in the manner described in Section 19 of the Plan.
(b) Shareholder Approval. If any amendment requiring shareholder
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approval under Section 15(a) of the Plan is made then shareholder approval
shall be solicited as described in Section 19 of the Plan.
(c) Effect of Amendment or Termination. Any such amendment or
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termination of the Plan shall not affect Options and Stock Purchase Rights
already granted and such Options and Stock Purchase rights shall remain in full
force and effect as if this Plan had not been amended or terminated, unless
mutually agreed otherwise between the Optionee, Purchaser or holder of the Stock
Purchase right, and the Board, which agreement must be in writing and signed by
the Optionee, Purchaser or holder of the Stock Purchase Right and the Company.
16. Conditions Upon Issuance of Shares. Shares shall not be issued
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pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right and the issuance and delivery of
such Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the Shares may then be listed, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.
As a condition to the exercise of an Option or Stock Purchase Right,
the Company may require the person exercising such Option or Stock Purchase
Right to
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represent and warrant at the time of any such exercise that the Shares
are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company,
such a representation is required by any of the aforementioned relevant
provisions of law.
17. Reservation of Shares. The Company, during the term of this Plan, will
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at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the plan.
The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.
18. Option Agreement and Stock Purchase Agreement. Options shall be
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evidenced by written option agreements in such form as the Board shall approve.
Upon exercise of Stock Purchase Rights, a Purchaser shall execute a Restricted
Stock Purchase Agreement in such form as the Board of Directors shall approve.
19. Shareholder Approval.
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(a) If shareholder approval is obtained at a duly held shareholders'
meeting, it must be obtained by the affirmative vote of the holders of a
majority of the outstanding shares of the Company, or if such shareholder
approval is obtained by written consent, it must be obtained by the unanimous
written consent of all shareholders of the Company; provided, however, that
approval at a meeting or by written consent may be obtained by a lesser degree
of shareholder approval if the Board determines, in its discretion after
consultation with the Company's legal counsel, that such a lesser degree of
shareholder approval will comply with all applicable laws and will not adversely
affect the qualification of the Plan under Section 422A of the Code.
(b) Shareholder approval shall be solicited substantially in
accordance with Section 14(a) of the Exchange Act and the rules and regulations
promulgated thereunder.
(c) If any required approval by the shareholders of the Plan itself or
of any amendment thereto is solicited at any time other than in the manner
described in Section 19(b) hereof, then the Company shall, at or prior to the
first annual meeting of shareholders held subsequent to the granting of an
Option hereunder to an officer or director, do the following:
(i) furnish in writing to the holders entitled to vote for the Plan
substantially the same information which would be required (if proxies to be
voted with respect to approval of disapproval of the Plan or amendment were then
begin solicited) by
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the rules and regulations in effect under Section 14(a) of the Exchange Act at
the time such information is furnished; and
(ii) file with, or mail for filing to, the Securities and Exchange
Commission four copies of the written information referred to in subsection (i)
hereof not later than the date on which such information is first sent or given
to shareholders.
20. Information to Optionees and Holders of Stock Purchase Rights. The
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Company shall provide to each Optionee and each holder of a Stock Purchase
Right, during the period for which such Optionee or holder has one or more
Options or Stock Purchase Rights outstanding, copies of all annual reports and
other information which are required by applicable law or regulation to be
provided to all shareholders of the Company. The Company shall not be required
to provide such information if the issuance of Options and Stock Purchase Rights
under the Plan is limited to key employees whose duties in connection with the
Company assure their access to equivalent information.
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