Exhibit 10.1
HEALTHDESK CORPORATION
1994 FOUNDERS' STOCK OPTION PLAN
I. PURPOSES OF THE FOUNDERS' PLAN
This 1994 Founders' Stock Option Plan (the "Founders' Plan")
is intended to promote the interests of HealthDesk Corporation, a California
corporation, by providing a method whereby eligible individuals who provide
valuable services to the Corporation (or any Parent or Subsidiary) may be
offered incentives and rewards which will encourage them to acquire a
proprietary interest, or otherwise increase their proprietary interest, in the
Corporation and continue to render valuable services to the Corporation (or any
Parent or Subsidiary).
II. DEFINITIONS
For the purposes of this Founders' Plan, the following
definitions shall be in effect:
A. Board shall mean the Board of Directors of the Corporation.
B. Code shall mean the Internal Revenue Code of 1986, as
amended.
C. Committee shall mean a committee of two (2) or more Board
members appointed by the Board to exercise one or more administrative functions
under the Founders' Plan.
D. Common Stock shall mean the common stock of the
Corporation.
E. Corporate Transaction shall mean either of the following
shareholder-approved transactions to which the Corporation is a party:
(i) a merger or consolidation in which securities
possessing more than fifty percent (50%) of the total combined voting
power of the Corporation's outstanding securities are transferred to
a person or persons different from the persons holding those
securities immediately prior to such transaction; or
(ii) the sale, transfer or other disposition of all or
substantially all of the Corporation's assets in complete liquidation
or dissolution of the Corporation or any Parent or Subsidiary.
F. Corporation shall mean HealthDesk Corporation, a California
corporation.
G. Employee shall mean an individual who is in the employ of
the Corporation, or any Parent or Subsidiary, and who is subject to the control
and direction of the employer entity as to both the work to be performed and the
manner and method of performance.
H. Exchange Act shall mean the Securities Exchange Act of
1934, as amended.
I. Exercise Date shall mean the date on which the Corporation
shall have received written notice of the exercise of the option.
J. Fair Market Value per share of Common Stock on any relevant
date under the Founders' Plan shall be the value determined in accordance with
the following provisions:
(i) If the Common Stock is at the time neither
listed nor admitted to trading on any Stock Exchange nor
traded on the NASDAQ National Market System, then such Fair
Market Value shall be determined by the Founders' Plan
Administrator after taking into account such factors as the
Founders' Plan Administrator shall deem appropriate;
(ii) If the Common Stock is not at the time
listed or admitted to trading on any Stock Exchange but is
traded on the NASDAQ National Market System, the Fair Market
Value shall be the closing selling price per share of Common
Stock on the date in question, as such price is reported by
the National Association of Securities Dealers through the
NASDAQ National Market System or any successor system. If
there is no closing selling price for the Common Stock on the
date in question, then the Fair Market Value shall be the
closing selling price on the last preceding date for which
such quotation exists; or
(iii) If the Common Stock is at the time listed
or admitted to trading on any Stock Exchange, then the Fair
Market Value shall be the closing selling price per share of
Common Stock on the date in question on the Stock Exchange
determined by the Founders' Plan Administrator to be the
primary market for the Common Stock, as such price is
officially quoted in the composite tape of transactions on
such exchange. If there is no closing selling price for the
Common Stock on the date in question, then the Fair Market
Value shall be the closing selling price on the last preceding
date for which such quotation exists.
K. Founders' Plan Administrator shall mean either the Board or
the Committee, to the extent the Committee is at the time responsible for the
administration of the Founders' Plan in accordance with Article III below.
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L. Incentive Option shall mean a stock option which satisfies
the requirements of Code Section 422.
M. Non-Statutory Option shall mean a stock option not intended
to meet the requirements of Code Section 422.
N. Parent shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations ending with the Corporation,
provided each corporation in the unbroken chain (other than the Corporation)
owns, at the time of the determination, stock possessing fifty percent (50%) or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
O. Permanent Disability shall have the meaning assigned to
such term in Code Section 22(e)(3).
P. Service shall mean the provision of services to the
Corporation, or any Parent or Subsidiary, by an individual in the capacity of an
Employee, a non-employee member of the board of directors or a consultant or
independent contractor.
Q. Stock Exchange shall mean either the American Stock
Exchange or the New York Stock Exchange.
R. Subsidiary shall mean each corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each such corporation (other than the last corporation) in
the unbroken chain owns, at the time of the determination, stock possessing
fifty percent (50%) or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.
S. 10% Shareholder shall mean the owner of stock (as
determined under Code Section 424(d)) possessing ten percent (10%) or more of
the total combined voting power of all classes of stock of the Corporation or
any Parent or Subsidiary.
III. ADMINISTRATION OF THE FOUNDERS' PLAN
A. The Founders' Plan shall be administered by the Board.
However, any or all administrative functions otherwise exercisable by the Board
may be delegated by the Board to the Committee. Members of the Committee shall
serve for such period of time as the Board may determine and shall be subject to
removal by the Board at any time. The Board may also at any time terminate the
functions of the Committee and reassume all powers and authority previously
delegated to the Committee.
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B. The Founders' Plan Administrator shall have full power and
authority (subject to the provisions of the Founders' Plan) to establish such
rules and regulations as it may deem appropriate for proper administration of
the Founders' Plan and to make such determinations under, and issue such
interpretations of, the Founders' Plan and any outstanding options as it may
deem necessary or advisable. Decisions of the Founders' Plan Administrator shall
be final and binding on all parties who have an interest in the Founders' Plan
or any outstanding option.
IV. ELIGIBILITY FOR OPTION GRANTS
A. The persons eligible to receive option grants under the
Founders' Plan are as follows:
(i) Employees;
(ii) non-employee members of the Board or the
non-employee members of the board of directors of any Parent or
Subsidiary; and
(iii) consultants and other independent contractors who
provide valuable services to the Corporation (or any Parent or
Subsidiary), as determined by the Founders' Plan Administrator.
B. The Founders' Plan Administrator shall have full authority
to determine which eligible individuals are to receive option grants under the
Founders' Plan, the number of shares to be covered by each such grant, the
status of the granted option as either an Incentive Option or a Non-Statutory
Option, the time or times at which each option is to become exercisable, the
vesting schedule (if any) applicable to the option shares and the maximum term
for which the option is to remain outstanding.
V. STOCK SUBJECT TO THE FOUNDERS' PLAN
A. The stock issuable under the Founders' Plan shall be shares
of the Corporation's authorized but unissued or reacquired Common Stock. The
maximum number of shares which may be issued over the term of the Founders' Plan
shall not exceed Three Hundred Sixty Thousand (360,000) shares, subject to
adjustment from time to time in accordance with the provisions of this Article
V. In no event may any one officer of the Corporation acquire shares of Common
Stock under the Founders' Plan in excess of twenty-five percent (25%) of the
total share reserve available for issuance under the Founders' Plan.
B. Shares subject to outstanding options shall be available
for subsequent option grants under the Founders' Plan to the extent (i) the
options expire or terminate for any reason prior to exercise in full or (ii) the
options are cancelled in accordance with the cancellation and regrant provisions
of Article IX below. All shares issued under the Founders' Plan, whether or not
those shares are subsequently repurchased by the Corporation pursuant to its
repurchase rights under the Founders' Plan, shall reduce on a share-for-share
basis the number of shares of Common Stock available for subsequent option
grants.
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C. In the event any change is made to the Common Stock
issuable under the Founders' Plan by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change
affecting the outstanding Common Stock as a class without the Corporation's
receipt of consideration, appropriate adjustments shall be made to (i) the
maximum number and/or class of securities issuable under the Founders' Plan and
(ii) the number and/or class of securities and the exercise price per share in
effect under each outstanding option in order to prevent the dilution or
enlargement of benefits thereunder. The adjustments determined by the Founders'
Plan Administrator shall be final, binding and conclusive.
VI. TERMS AND CONDITIONS OF OPTIONS
Options granted pursuant to the Founders' Plan shall be
authorized by action of the Founders' Plan Administrator and may, at the
Founders' Plan Administrator's discretion, be either Incentive Options or
Non-Statutory Options. Each granted option shall be evidenced by one or more
instruments in the form approved by the Founders' Plan Administrator, provided,
however, that each such instrument shall comply with the terms and conditions
specified below. Each instrument evidencing an Incentive Option shall, in
addition, be subject to the applicable provisions of Article VII below.
A. Exercise Price.
1. The exercise price per share shall be fixed by the
Founders' Plan Administrator. In no event, however, shall the exercise price per
share be less than eighty-five percent (85%) of the Fair Market Value per share
of Common Stock on the date of the option grant.
2. If the individual to whom the option is granted is
a 10% Shareholder, then the exercise price per share shall not be less than one
hundred ten percent (110%) of the Fair Market Value per share of Common Stock on
the grant date.
3. The exercise price shall become immediately due
upon exercise of the option and shall, subject to the provisions of Article X
below and the agreement evidencing the grant of the option, be payable in cash
or check made payable to the Corporation. Should the Corporation's outstanding
Common Stock be registered under Section 12(g) of the Exchange Act at the time
the option is exercised, then the exercise price may also be paid as follows:
(i) in shares of Common Stock held by the optionee for
the requisite period necessary to avoid a charge to the Corporation's
earnings for financial reporting purposes and valued at Fair Market
Value on the Exercise Date; or
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(ii) through a special sale and remittance procedure
pursuant to which the optionee shall concurrently provide irrevocable
written instructions (a) to a brokerage firm designated by the
Corporation to effect the immediate sale of the purchased shares and
remit to the Corporation, out of the sale proceeds available on the
settlement date, sufficient funds to cover the aggregate exercise
price payable for the purchased shares plus all applicable Federal,
state and local income and employment taxes required to be withheld
by the Corporation by reason of such purchase and (b) to the
Corporation to deliver the certificates for the purchased shares
directly to such brokerage firm in order to effect the sale
transaction.
Except to the extent such sale and remittance procedure is
utilized, payment of the exercise price for the purchased shares must be made on
the Exercise Date.
B. Term and Exercise of Options. Each option granted under the
Founders' Plan shall be exercisable at such time or times, during such period
and for such number of shares as shall be determined by the Founders' Plan
Administrator and set forth in a stock option agreement. However, no option
shall have a term in excess of ten (10) years measured from the grant date. The
option shall be exercisable during the optionee's lifetime only by the optionee
and shall not be assignable or transferable other than by will or by the laws of
descent and distribution following the optionee's death.
C. Effect of Termination of Service.
1. Except to the extent otherwise provided pursuant to
subsection C.2 below, the following provisions shall govern the exercise period
applicable to any options held by the optionee at the time of cessation of
Service or death:
(i) Should the optionee cease to remain in Service for
any reason other than death or Permanent Disability, then the period
during which each outstanding option held by such optionee is to
remain exercisable shall be limited to the three (3) month period
following the date of such cessation of Service;
(ii) Should such Service terminate by reason of Permanent
Disability, then the period during which each outstanding option held
by the optionee is to remain exercisable shall be limited to the
twelve (12) month period following the date of such cessation of
Service;
(iii) Should the optionee die while holding one or more
outstanding options, then the period during which each such option is
to remain exercisable shall be limited to the twelve (12) month
period following the date of the optionee's death. During such
limited period, the option may be exercised by the personal
representative of the optionee's estate or by the person or persons
to whom the option is transferred pursuant to the optionee's will or
in accordance with the laws of descent and distribution;
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(iv) Under no circumstances, however, shall any such
option be exercisable after the specified expiration date of the
option term; and
(v) During the applicable post-Service exercise period
set forth in this subsection C.1, the option may not be exercised in
the aggregate for more than the number of vested shares for which the
option is exercisable on the date of the optionee's cessation of
Service. Upon the expiration of the applicable exercise period or (if
earlier) upon the expiration of the option term, the option shall
terminate and cease to be exercisable for any vested shares for which
the option has not been exercised. However, the option shall,
immediately upon the optionee's cessation of Service, terminate and
cease to be outstanding with respect to any option shares for which
the option is not at that time exercisable or in which the optionee
is not otherwise at that time vested.
2. The Founders' Plan Administrator shall have full
power and authority to extend the period of time for which the option is to
remain exercisable following the optionee's cessation of Service or death from
the limited period in effect under subsection C.1 of this Article VI to such
greater period of time as the Founders' Plan Administrator shall deem
appropriate; provided, that in no event shall such option be exercisable after
the specified expiration date of the option term.
D. Shareholder Rights. An optionee shall have no shareholder
rights with respect to the shares subject to the option until such individual
shall have exercised the option and paid the exercise price.
E. Unvested Shares. The Founders' Plan Administrator shall
have the discretion to authorize the issuance of unvested shares of Common Stock
under the Founders' Plan. Should the optionee cease Service while holding such
unvested shares, the Corporation shall have the right to repurchase, at the
exercise price paid per share, all or (at the discretion of the Corporation and
with the consent of the optionee) any of those unvested shares. The terms and
conditions upon which such repurchase right shall be exercisable (including the
period and procedure for exercise and the appropriate vesting schedule for the
purchased shares) shall be established by the Founders' Plan Administrator and
set forth in the agreement evidencing such repurchase right. In no event,
however, may the Founders' Plan Administrator impose a vesting schedule upon any
option granted under the Founders' Plan or any shares of Common Stock subject to
the option which is more restrictive than twenty percent (20%) per year vesting,
beginning one (1) year after the grant date. All outstanding repurchase rights
under the Founders' Plan shall terminate automatically upon the occurrence of
any Corporate Transaction, except to the extent the repurchase rights are
expressly assigned to the successor corporation (or parent thereof) in
connection with the Corporate Transaction.
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F. First Refusal Rights. Until such time as the Corporation's
outstanding shares of Common Stock are first registered under Section 12(g) of
the Exchange Act, the Corporation shall have the right of first refusal with
respect to any proposed sale or other disposition by the optionee (or any
successor in interest by reason of purchase, gift or other transfer) of any
shares of Common Stock issued under the Founders' Plan. Such right of first
refusal shall be exercisable in accordance with the terms and conditions
established by the Founders' Plan Administrator and set forth in the agreement
evidencing such right.
VII. INCENTIVE OPTIONS
The terms and conditions specified below shall be applicable
to all Incentive Options granted under the Founders' Plan. Except as modified by
the provisions of this Article VII, all the provisions of the Founders' Plan
shall be applicable to Incentive Options. Incentive Options may only be granted
to individuals who are Employees. Options which are specifically designated as
Non-Statutory shall not be subject to such terms and conditions.
A. Exercise Price. The exercise price per share of the Common
Stock subject to an Incentive Option shall in no event be less than one hundred
percent (100%) of the Fair Market Value per share of Common Stock on the date of
grant.
B. Dollar Limitation. The aggregate Fair Market Value of the
Common Stock (determined as of the respective date or dates of grant) for which
one (1) or more options granted to any Employee under this Founders' Plan (or
any other option plan of the Corporation or any Parent or Subsidiary) may for
the first time become exercisable as Incentive Options during any one (1)
calendar year shall not exceed the sum of One Hundred Thousand Dollars
($100,000). To the extent the Employee holds two (2) or more such options which
become exercisable for the first time in the same calendar year, the foregoing
limitation on the exercisability of such options as Incentive Options shall be
applied on the basis of the order in which such options are granted. Should the
applicable One Hundred Thousand Dollar ($100,000) limitation in fact be exceeded
in any calendar year, then the option shall nevertheless become exercisable for
the excess number of shares in such calendar year as a Non-Statutory Option.
C. 10% Shareholder. If any individual to whom an Incentive
Option is granted is a 10% Shareholder, then the option term shall not exceed
five (5) years measured from the grant date.
VIII. CORPORATE TRANSACTION
A. Upon the occurrence of a Corporate Transaction, each option
at the time outstanding under the Founders' Plan shall terminate and cease to be
exercisable, except to the extent assumed by the successor corporation or parent
thereof.
B. Each outstanding option which is assumed in connection with
a Corporate Transaction or is otherwise to remain outstanding shall be
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appropriately adjusted, immediately after such Corporate Transaction, to apply
and pertain to the number and class of securities which would have been issuable
to the optionee in the consummation of such Corporate Transaction, had the
option been exercised immediately prior to such Corporate Transaction.
Appropriate adjustments shall also be made to (i) the class and number of
securities available for issuance under the Founders' Plan following the
consummation of such Corporate Transaction and (ii) the exercise price payable
per share, provided the aggregate exercise price payable for such securities
shall remain the same.
C. The grant of options under this Founders' Plan shall in no
way affect the right of the Corporation to adjust, reclassify, reorganize or
otherwise change its capital or business structure or to merge, consolidate,
dissolve, liquidate or sell or transfer all or any part of its business or
assets.
IX. CANCELLATION AND REGRANT OF OPTIONS
The Founders' Plan Administrator shall have the authority to
effect, at any time and from time to time, with the consent of the affected
option holders, the cancellation of any or all outstanding options under the
Founders' Plan and to grant in substitution therefor new options under the
Founders' Plan covering the same or different numbers of shares of Common Stock
but with an exercise price per share not less than (i) one hundred percent
(100%) of the Fair Market Value per share of Common Stock on the new grant date
in the case of a grant of an Incentive Option, (ii) one hundred ten percent
(110%) of such Fair Market Value in the case of an option grant to a 10%
Shareholder or (iii) eighty-five percent (85%) of such Fair Market Value in the
case of all other grants.
X. LOANS
A. The Founders' Plan Administrator may assist any optionee in
the exercise of one or more options granted to the optionee by:
(i) authorizing the extension of a loan from the
Corporation to the optionee; or
(ii) permitting the optionee to pay the exercise
price in installments over a period of years.
B. The terms of any loan or installment method of payment
(including the interest rate and terms of repayment) shall be established by the
Founders' Plan Administrator in its sole discretion. Loans or installment
payments may be authorized with or without security or collateral. However, any
loan made to a consultant or other non-employee advisor must be secured by
property other than the purchased shares of Common Stock. In all events, the
maximum credit available to each optionee may not exceed the sum of (i) the
aggregate exercise price payable for the purchased shares plus (ii) any Federal,
state and local income and employment tax liability incurred by the optionee in
connection with such exercise.
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C. The Founders' Plan Administrator may, in its absolute
discretion, determine that one or more loans extended under this Article X shall
be subject to forgiveness by the Corporation in whole or in part upon such terms
and conditions as the Founders' Plan Administrator may in its discretion deem
appropriate.
XI. NO EMPLOYMENT OR SERVICE RIGHTS
Nothing in the Founders' Plan shall confer upon the optionee
any right to continue in Service for any period of specific duration or
interfere with or otherwise restrict in any way the rights of the Corporation
(or any Parent or Subsidiary) or of the optionee, which rights are hereby
expressly reserved by each, to terminate the optionee's Service at any time for
any reason, with or without cause.
XII. AMENDMENT OF THE FOUNDERS' PLAN
A. The Board shall have complete and exclusive power and
authority to amend or modify the Founders' Plan in any or all respects
whatsoever. However, no such amendment or modification shall, without the
consent of the holders, adversely affect their rights and obligations under
their outstanding options. In addition, the Board shall not, without the
approval of the Corporation's shareholders, (i) increase the maximum number of
shares issuable under the Founders' Plan, except for permissible adjustments
under Article V, (ii) materially modify the eligibility requirements for option
grants or (iii) otherwise materially increase the benefits accruing to option
holders.
B. Options may be granted under this Founders' Plan to
purchase shares of Common Stock in excess of the number of shares then available
for issuance under the Founders' Plan, provided an amendment sufficiently
increasing the number of shares of Common Stock available for issuance under the
Founders' Plan is approved by the Corporation's shareholders within twelve (12)
months after the date the excess grants are first made.
XIII. EFFECTIVE DATE AND TERM OF FOUNDERS' PLAN
A. The Founders' Plan shall become effective when adopted by
the Board, but no option granted under the Founders' Plan shall become
exercisable unless and until the Founders' Plan shall have been approved by the
shareholders of the Corporation. If such shareholder approval is not obtained
within twelve (12) months after the date of the Board's adoption of the
Founders' Plan, then all options previously granted under the Founders' Plan
shall terminate and no further options shall be granted. Subject to such
limitation, the Founders' Plan Administrator may grant options under the
Founders' Plan at any time after the effective date and before the date fixed
herein for termination of the Founders' Plan.
B. The Founders' Plan shall terminate upon the earliest of (i)
the expiration of the ten (10) year period measured from the date the Founders'
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Plan is adopted by the Board, (ii) the date on which all shares available for
issuance under the Founders' Plan shall have been issued or (iii) the
termination of all outstanding options under Article VIII. Upon such plan
termination, each option and unvested share issuance outstanding under the
Founders' Plan shall continue to have full force and effect in accordance with
the provisions of the agreements evidencing that option or share issuance.
XIV. USE OF PROCEEDS
Any cash proceeds received by the Corporation from the sale of
shares pursuant to options granted under the Founders' Plan shall be used for
general corporate purposes.
XV. WITHHOLDING
The Corporation's obligation to deliver shares upon the
exercise of any options granted under the Founders' Plan shall be subject to the
satisfaction by the optionee of all applicable Federal, state and local income
and employment tax withholding requirements.
XVI. REGULATORY APPROVALS
The implementation of the Founders' Plan, the granting of any
option hereunder and the issuance of Common Stock upon the exercise of any
option shall be subject to the Corporation's procurement of all approvals and
permits required by regulatory authorities having jurisdiction over the
Founders' Plan, the options granted under it and the Common Stock issued
pursuant to it.
XVII. FINANCIAL REPORTS
The Corporation shall deliver at least annually to each
individual holding an outstanding option under the Founders' Plan the same
financial information furnished to holders of the Common Stock, unless the
optionee is a key employee whose duties in connection with the Corporation
assure such individual access to equivalent information.
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