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EXHIBIT 10.1
AMENDED AND RESTATED
(as of 4/16/97)
FILETEK, INC.
1990 STOCK OPTION INCENTIVE PLAN
1. PURPOSE OF THE PLAN
The purpose of this 1990 Stock Option Incentive Plan is to advance the
interests of FileTek, Inc., a Delaware corporation (the "Company") and its
shareholders by providing an effective incentive, in attracting and retaining
the best available personnel for positions of substantial responsibility, and
to furnish additional incentive and encourage continued employment for officers
and certain other key employees upon whose judgement, initiative and efforts
the successful conduct and development of its business largely depends.
It is the intent of the Company that, while the Company is not subject
to the reporting requirements of the Exchange Act, this Plan and the Options
granted pursuant hereto will comply with Rule 701 promulgated under the
Securities Act. Rule 701 provides that shares acquired in Rule 701
transactions may be resold 90 days after the Company becomes subject to the
provisions of the Exchange Act, without compliance with paragraphs (c), (d),
(e) and (h) of Rule 144 if the person is not an affiliate of the issuer or
under Rule 144 without compliance with paragraph (d), if an affiliate.
2. DEFINITIONS
As used herein, the following definitions shall apply:
2.0 "Board" means the Option Committee, if one has been appointed,
or the Board of Directors of the Company if no Option Committee is appointed.
2.1 "Code" means the Internal Revenue Code of 1986, as amended.
2.2 "Common Stock" means the Common Stock, par value $.01 per share
of FileTek.
2.3 "Company" means FileTek, Inc. and its Parents and Subsidiaries.
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2.4 "Continuous Employment" or "Continuous Status As An Employee"
means employment not interrupted or terminated with the Company. Employment
shall not be considered interrupted in the case of sick leave, military leave
or any other leave of absence approved by the Board or transfers between
payroll locations or between the Company, its Parent, its Subsidiaries, or its
successor.
2.5 "Employee" means any person, including officers, employed by
the Company, or any Parent or Subsidiary of the Company.
2.6 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
2.7 "Fair Market Value" means the fair market value of Shares, as
determined pursuant to Section 9.
2.8 "Option" means a stock option granted pursuant to this Plan.
Options may be at the discretion of the Board and as reflected in the terms of
the written Option Agreement either "Incentive Stock Options", which are
Options intended to be eligible to be treated as such under Section 422A of the
Code, or "NonStatutory Stock Options" which are Options other than Incentive
Stock Options.
2.9 "Option Agreement" means the agreement between FileTek and an
Optionee for the grant of an option.
2.10 "Option Committee" means the Stock Option Committee appointed
by the Board in accordance with Section 4.1 of this Plan, if one is appointed.
2.11 "Option Stock" means stock subject to an Option granted
pursuant to this Plan.
2.12 "Optionee" means an Employee who receives an Option.
2.13 "Parent" means a "parent corporation", whether now or hereafter
existing, as defined in Section 425(e) and (g) of the Code.
2.14 "Plan" means this FileTek 1990 Stock Option Incentive Plan.
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2.15 "Securities Act" means the Securities Act of 1933, as amended.
2.16 "Shares" means shares of the Common Stock.
2.17 "Subsidiary" means a "subsidiary corporation", whether now or
hereafter existing, as defined in Section 425(f) and (g) of the Code.
2.18 "Tax Date" means the date withholding tax is determined under
the Code for a Grantee with respect to the Grantee's exercise of a NonStatutory
Stock Option.
3. STOCK SUBJECT TO THE PLAN.
Subject to the provisions of Section 11 of this Plan, the maximum
aggregate number of Shares which may be optioned and sold under the Plan,
excluding the Shares involved in the unexercised portion of any cancelled,
terminated or expired options, is 660,000 Shares. Such Shares shall be
authorized and unissued shares or treasury shares.
If an Option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were
subject hereto shall, unless the Plan shall have been terminated, become
available for other Options under the Plan.
4. ADMINISTRATION OF THE PLAN.
4.1 Procedure. The Plan shall be administered by (I) the Board
of Directors of the Company, or (ii) a committee appointed by the Board
consisting of three (3) or more Directors, or (iii) an Option Committee of at
least three directors of the Company appointed by the Board of Directors, each
of whom is a "disinterested person" as defined at Rule 16b-3(d) (3) of the
Rules of the Securities and Exchange Commission, which at the time of adoption
of this Plan require that such Option Committee members not be, or have at any
time within one (1) year prior to their appointment been, eligible to
participate in this Plan or any other plan of the Company or any of its
affiliates entitling the participants therein to acquire stock, stock options
or stock appreciation rights of the Company or any of its affiliates. A
majority of the entire Option Committee shall constitute a quorum and the
action of a majority of the members present at any meeting at which a quorum is
present or acts reduced to or approved in writing by a majority of the members
of the Option Committee shall be deemed the action of the Option Committee.
The Option Committee may appoint a secretary to keep
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minutes of its meetings and may make such rules and regulations for the conduct
of its business as it shall deem advisable.
4.2 Powers of the Board. Subject to the provisions of the Plan,
the Board shall have sole authority, in its absolute discretion: (i) to
determine upon review of relevant information and in accordance with Section 9
of the Plan, the Fair Market Value of the Shares covered by each Option; (ii)
to determine the Employees to whom and at what time Options shall be granted,
and the number of Shares to be represented by each Option; (iii) to interpret
the Plan, (iv) to prescribe, amend and rescind rules and regulations relating
to the Plan; (v) to correct any defect or omission, or reconcile any
inconsistency in the Plan or in any Option Agreement, in the manner and to the
extent it shall deem necessary or expedient to make the Plan fully effective;
(vi) to determine the terms and provisions of each Option granted under the
Plan (which need not be identical) and, with the consent of the holder thereof,
modify or amend each Option; (vii) to accelerate any exercise date of any
Option; (viii) to determine the duration and purposes of leaves of absence
which may be granted to Optionees, as a class or in specific cases, without
constituting a termination of their employment for purposes of this 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 to
promote the best interests of the Company with respect to administration of the
Plan.
4.3 Effect of the Board's Decision. All decisions, determinations
and interpretations of the Board shall be final and binding on all Optionees
and other holders of any Options granted under this Plan. No member of the
Board shall be liable for any action or determination made with respect to the
Plan or any Option granted under it, except for willful bad faith or deliberate
fraud resulting in direct financial benefit to such Board or Option Committee
member, and any liability shall be limited to the amount of such benefit.
4.4 Indemnification of the Board. In addition to such other rights
of indemnification as they may have as members of the Board of Directors, the
members of the Board shall be indemnified by the Company against all costs and
expenses (including attorneys' fees) reasonably incurred by them in connection
with any action, suit or proceeding to which they or any of them may be a party
by reason of any action taken or failure to act under or in connection with
the Plan, or any Option granted thereunder (including an action, suit or
proceeding to enforce this indemnification) and against all amounts paid by
them in settlement thereof (provided such settlement is approved by legal
counsel selected by the Company, or paid by them in satisfaction of a judgement
in any such action, suit or proceeding, except a judgement based upon a finding
of bad faith. Upon the
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institution of any such action, suit or proceeding a Board member shall notify
the Company in writing, giving the Company an opportunity, at its own expense,
to handle and defend the same before such Board member undertakes to handle it
on his own behalf.
5. ELIGIBILITY.
5.1 All Employees of the Company shall be eligible to receive
Options granted under this Plan. Options shall be granted to those Employees
(including officers, whether or not they are also directors) of the Company as
the Board shall elect from time to time on the basis of their being key
employees who have made a significant contribution or can make a potential
contribution to the business of the Company. An Employee who has been granted
an Option may, if he is otherwise eligible, be granted an additional Option or
Options.
5.2 In the case of any Incentive Stock Option, the aggregate Fair
Market Value (determined as of the time the Option is granted) of the stock
with respect to which Incentive Stock Options are exercisable for the first
time by such individual during any calendar year (under all plans of his
employer corporation and its parent and subsidiary corporations which are
includible within the limit provided at Section 422A(b)(7) of the Code), shall
not exceed $100,000.
5.3 No Employee is eligible to receive any Options which, if
exercised, would result in his holding beneficially or of record in excess of
ten percent (10%) of the outstanding voting stock of FileTek.
5.4 The Plan shall not confer upon any Optionee any right with
respect to continuation of employment nor shall it interfere in any way with
such Optionee's right or the Company's right to terminate this employment at
any time.
6. TERM OF PLAN.
This Plan shall become effective upon its adoption by the Board of
Directors, 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 (10) years from the
earlier of the date of adoption of this Plan or its approval by the
shareholders as contemplated by Section 13.1.
7. OPTION AGREEMENTS.
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This Plan permits the issuance of either Incentive Stock Options or
NonStatutory Stock Options. The Board, in its grant of Options, and the Option
Agreement evidencing such grant, shall clearly identify which type of Option
has been granted. Such Option Agreement shall be substantially in the form of
(i) (Exhibit "A" attached hereto if the option is an Incentive Stock Option,
or (ii) Exhibit "B" attached hereto if the option is a NonStatutory Stock
Option, or such other form (not inconsistent with the Plan) as the Board may
from time to time approve). Each Option Agreement shall contain such
provisions as the Option Committee shall from time to time deem appropriate and
need not be identical.
8. TERM OF OPTIONS.
The term of each Option granted under the Plan shall be specified
therein, but in no event shall any Option be exercisable after the expiration
of ten (10) years from the date of the grant thereof.
9. OPTION PRICE.
The per Share exercise price for the Shares to be issued pursuant to
any Option granted under the Plan shall be not less than one hundred percent
(100%) of the Fair Market Value of such shares on the date the option is
granted, provided, however, that in the case of an Incentive Stock Option
granted to an Employee who, at the time of the grant of such Incentive Stock
Option, owns stock representing more than ten percent (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 110% of the fair market value per
Share on the date of grant.
The fair market value shall be determined by the Board in its
discretion; provided, however, in the event the Common Stock is listed on a
stock exchange or traded on the National Association of Securities Dealers
Automated Quotation ("NASDAQ") National Market System, the fair market value
per Share on the date of grant of the Option shall be determined by the Board
of Directors by using any reasonable method using market quotations. Such
reasonable methods shall include (i) the closing price per Share of Common
Stock on such exchange or on the NASDAQ National Market System on the date of
grant of the Option, as reported in the Wall Street Journal, or (ii) when
deemed appropriate in the sole discretion of the Board of Directors, an average
of the daily closing prices per Share of the Common Stock on such exchange or
on the NASDAQ National Market
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System, as reported in the Wall Street Journal, during a limited period
preceding the date of grant of the Option.
10. EXERCISE OF OPTIONS.
10.1 Procedure for Exercise. Any Option granted hereunder shall be
exercisable in such installments, at such times and under such conditions as
the Board shall designate under the terms of the Plan and of the Option
Agreement; provided, that unless otherwise determined by the Board at or after
grant, no Option shall be exercisable prior to the first anniversary of its
date of grant. To the extent not exercised, installments shall, unless
otherwise provided in the Option Agreement, accumulate and be exercisable, in
whole or in part, at any time after becoming exercisable, but not later than
the date the Option expires.
The minimum number of Shares with respect to which an Option may be
exercised at any one time shall be one hundred (100) shares, unless the number
purchased is the total number at the time available for purchase under the
Option. An Option may not be exercised for a fractional Share. No Option may
be exercised after the expiration of its term as specified in Section 8.
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 for the shares to be issued upon exercise of an Option,
including method of payment, shall be determined by the Board and may consist
entirely of cash, check, delivery of previously owned Shares having a Fair
Market Value on the date of surrender equal to the aggregate exercise price of
the Shares as to which said Option 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 by law and approved by the
Board. In the event that the Optionee elects to pay the total purchase price
in whole or in part with previously acquired Shares, such Shares shall have
been owned by the Optionee a minimum of six months or such other period as
determined by the Board. Until the issuance of the stock certificates (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 stockholder shall exist with respect to
Option Shares notwithstanding the exercise of the Option. No adjustment will
be made for a dividend or other rights for which the record date is prior to
the date the stock certificates are issued except as provided in Section 11 of
the Plan.
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The Board may, in its sole discretion, and to the extent that the
Shares are publicly traded, permit an Optionee to exercise an Option by
delivering to the Company a properly executed Broker Exercise Notice in form
and substance acceptable to the Board. The Broker Exercise Notice shall
contain irrevocable instructions from the Optionee to the Company to issue to a
broker the stock certificates for the shares to be purchased upon exercise of
the Option, and the Company shall, if the Board decides to permit the Option to
be exercised in this manner, acknowledge to the broker that the Company
consents to such procedure. In addition, the Broker Exercise Notice shall
contain or be accompanied by irrevocable instructions from the Optionee to such
broker to sell a number of shares of Common Stock, or loan to the Optionee an
amount, sufficient to pay the exercise price of the Option and any withholding
obligations due upon such exercise and to promptly deliver to the Company the
amount of such sale or loan proceeds.
10.2 The exercise of each Option shall be subject to the condition
that if at any time the Company shall determine in its discretion that the
satisfaction of withholding tax or other withholding liabilities, or that the
listing, registration, or qualification of any Share otherwise deliverable upon
such exercise on any securities exchange or under any state or federal law, or
that the consent or approval of any regulatory body, is necessary or desirable
as a condition of, or in connection with, such exercise or the delivery or
purchase of Shares pursuant thereto, then in any such event, such exercise
shall not be effective unless such withholding, listing, registration,
qualification, consent or approval shall have been effected or obtained free of
any conditions not acceptable to the Company.
10.3 Withholding Taxes. The Company is entitled to (a) withhold and
deduct from future wages of the Optionee, or make other arrangements for the
collection of, all legally required amounts necessary to satisfy any federal,
state, or local withholding tax requirements attributable to the Optionee's
exercise of a NonStatutory Stock Option or otherwise incurred with respect to
the Option, or (b) require the Optionee promptly to remit the amount of such
withholding to the Company before acting on the Optionee's notice of exercise
of the Option.
The Board may, in its sole discretion and subject to such rules as the
Board may adopt, permit an Optionee to satisfy, in whole or in part, any
withholding tax obligation which may arise in connection with the exercise of a
NonStatutory Stock Option either by electing to have the Company withhold from
the Shares to be issued upon exercise that number of Shares, or by electing to
deliver to the Company already-owned Shares, in either case having a Fair
Market Value, on the Tax Date equal to the amount necessary to satisfy the
withholding amount due. An Optionee's election to have the Company withhold
Shares or to deliver already-owned Shares upon exercise must be made on or
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prior to the Tax Date, is irrevocable and is subject to the consent or
disapproval of the Board. If the Optionee is an officer, director, or
beneficial owner of more than 10% of the outstanding Common Stock of the
Company such election may not be made within six months of the date the
NonStatutory Stock Option is granted (unless the death or Disability of the
Optionee occurs prior to the expiration of such six-month period), and must be
made either six months prior to the Tax Date or to the extent that the
Corporation is subject to the reporting requirements of the Exchange Act, at
any time prior to the Tax Date between the third and twelfth business days
following public release of any of the Company's quarterly or annual summary
earnings statements. When Shares of common stock are issued prior to the Tax
Date to an Optionee making such an election, the Optionee shall agree in
writing to surrender that number of shares on the Tax Date having an aggregate
Fair Market Value equal to the tax due.
10.4 Exercise During Employment or Following Death or Disability.
Unless otherwise provided in the terms of an Option, an Option may be exercised
by the Optionee only while he is an Employee or within thirty (30) days
thereafter (other than as set forth in Section 10.5 below) and has maintained
Continuous Status As An Employee since the date of the grant of the Option to a
date within thirty (30) days of the date of exercise; except that if his
Continuous Employment is terminated by reason of his death or Disability, then
to the extent that the Optionee would have been entitled to exercise the Option
immediately prior to his death or Disability, such Option of the deceased or
disabled Optionee may be exercised during the period of one (1) year from the
date of death or Disability of the Employee, unless such Option would otherwise
sooner expire. Such exercise, in the case of Employee's death, shall be by the
person or persons (including his estate) to whom his rights under such Option
shall have passed by will or by laws of descent and distribution.
"Disability", as used herein, means a "disabled person" as defined at Section
422A(c)(9) of the Code.
10.5 Termination for Misconduct. If the Optionee's employment with
the Corporation or any affiliate thereof is terminated for misconduct at any
time after the date hereof, the Optionee's right to exercise the option granted
hereunder shall terminate immediately upon such termination for cause. For
purposes of this section, the term "misconduct" shall mean: (i) committing any
crime punishable by imprisonment; (ii) fraud on or misappropriation of any
funds or property of the Company or any affiliate thereof; or (iii) failure to
comply with the terms of any noncompetition, nondisclosure or related covenant
of employment executed by the Optionee for the benefit of the Company or any
affiliate thereof.
10.6 Non-Transferability of Options. An 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
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or distribution. An Option may be exercised during the lifetime of the
Optionee only by such Optionee.
10.7 Compliance with Law. The exercise of each option shall be on the
condition that the purchases of stock thereunder shall be for investment
purposes, and not with a view to resale or distribution unless the Shares
subject to such Option are registered under the Securities Act, as amended, or
if in the opinion of counsel for the Corporation such registration is not
required under the Securities Act or any other applicable law, regulation, or
rule of any governmental agency.
11. ADJUSTMENT UPON CHANGES IN CAPITALIZATION.
11.1 Changes in Capitalization. If the Shares of the Company''s
Common Stock as a whole are increased, decreased or changed into, or exchanged
for, a different number or kind of shares or securities of the Company, whether
through merger, consolidation, reorganization, recapitalization,
reclassification, stock dividend, stock split, combination of shares, exchange
of shares, change in corporate structure or the like, an appropriate and
proportionate adjustment shall be made in the number and kinds of shares
subject to the Option Plan, and in the number, kinds, and per share exercise
price of Shares subject to unexercised Options or portions thereof granted
prior to any such change. Any such adjustment in an outstanding Option,
however, shall be made without a change in the total price applicable to the
unexercised portion of the Option but with a corresponding adjustment in the
price for each Share covered by the Option.
11.2 Acquisition. Upon a reorganization, a merger or consolidation
in which the Company is not the surviving corporation, or upon the sale of all
or substantially all of the property of the Company to another corporation,
provision shall be made in connection with such transaction for the assumption
of the Plan and the Options theretofore granted by the successor corporation.
Provision may, alternatively, be made for the substitution for such Options of
new options of the successor employer corporation or a Parent or Subsidiary
thereof. In any such case appropriate adjustment as to the number and kind of
shares and the per share exercise prices shall be made by the Board, whose
determination as to what adjustment shall be made, and the extent thereof,
shall be conclusive. The Board shall have the discretion and power in any such
event to determine and to make effective provisions for the acceleration of the
time during which an Option may be exercised, notwithstanding the provisions of
the Option Agreement setting forth the date or dates at which all or any part
of it may be exercised. If the Board makes an Option fully exercisable in
lieu of assumption or substitution in the event of a merger or sale of assets,
the Board shall notify the Optionee that the Option shall be fully exercisable
for a period of thirty (30) days from the date of
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such notice, and the Option will terminate upon the expiration of such period.
No fractional Shares of stock shall be issued under the Option Plan on account
of any adjustment specified above. Notwithstanding the foregoing, the Board,
in its sole discretion, may determine that in connection with any such
reorganization, merger or consolidation in which the Company is not the
surviving corporation, Optionees holding outstanding Options shall receive,
with respect to each share of Common Stock subject to such Options, as of the
effective date of any such reorganization, merger or consolidation, cash in an
amount equal to the excess of the Fair Market Value of such shares immediately
prior to the effective date of such reorganization, merger or consolidation
over the exercise price per share of such Options.
11.3 Dissolution or Liquidation. Upon the dissolution or liquidation
of FileTek, this Option Plan and the Options issued hereunder shall 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 options shall terminate as of the date
fixed by the Board and gives each Optionee the right to exercise his option as
to all or any part of the Optional Stock, including shares as to which the
Option would not otherwise be exercisable in Section 6 hereof. Notice of the
determination shall be given to each Employee to whom an Option is so granted
within a reasonable time after the date of such grant.
13. APPROVAL, AMENDMENT AND TERMINATION OF THE PLAN.
13.1 Approval. This Plan shall be adopted by the Board of Directors,
and shall be presented to the shareholders of the Company for their approval,
to be given within twelve (12) months before or after the date of adoption
hereof. Options may be granted prior to such approval, but such Options shall
be contingent upon such approval being obtained and may not be exercised prior
to such approval.
If required to meet the requirements of Rule 16b-3, the Company shall
also furnish in writing to the holders of record of securities entitled to vote
for the Plan substantially the same information concerning the Plan as would be
required by the rules and regulations in effect under Section 14(a) of the
Exchange Act at the time such information is furnished, if proxies to be voted
with respect to approval or disapproval of the Plan were then being solicited,
on or prior to the date of the first annual meeting of security holders held
subsequent to the first registration of an equity security of FileTek under
Section 12 of the Exchange Act; but failure so to do shall not affect the Plan
or any Options granted before or after that date.
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13.2 Amendment. The Board, without further approval of the
stockholders, may amend this Plan at any time and from time to time in such
respects as the Board may deem advisable, subject to any required regulatory
approval and to the limitation that, except as provided in Section 11 hereof no
amendment shall be effective unless approved by vote of a majority of the
outstanding shares of FileTek within twelve (12) months before or after the
date of such amendment's adoption, where such amendment:
(a) Increases (except in accordance with Section 11
of the Plan) the maximum number of Shares for which Options may be granted
under the Plan;
(b) Changes the administration of the Plan prescribed
by Section 4 or the standards of eligibility prescribed by Section 5 of the
Plan;
(c) Changes the minimum Option price; or
(d) Increases the maximum term of Option provided for
herein.
13.3 Termination and Suspension. The Board, without further
approval of the stockholders, 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.
Rights and obligations under any Option granted while the Option Plan
is in effect shall not be altered or impaired by suspension or termination of
this Plan, except when the consent of the person to whom the Option was
granted. An Option may be terminated by agreement between an Optionee and
FileTek and, in lieu of the terminated Option, a new Option may be granted with
an exercise price which may be higher or lower than the exercise price of the
terminated Option.
14. TERM OF OPTION
The term of each Option shall be ten (10) years from the date of grant
thereof or such shorter term as may be provided by the Board; provided,
however, that the term of an Incentive Stock Option shall not exceed ten (10)
years from the date of grant. In addition, in the case of an Incentive Stock
Option granted to an Employee who, at the time the Option is granted, owns
stock representing more than ten percent (10%) of the voting power of all
classes of stock of the Company
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or any Parent or Subsidiary, the term of the Option shall be five (5) years
from the date of grant thereof, or such shorter time as may be provided by the
Board.
15. CONDITIONS UPON ISSUANCE OF SHARES.
Shares shall not be issued with respect to any Option granted under
this Plan unless the exercise of such Option and the issuance and delivery of
such Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act, 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 Corporation with respect to such
compliance. Inability of FileTek to obtain authority from any regulatory body
having jurisdictional authority deemed by its counsel to be necessary to the
lawful issuance and sale of any Shares hereunder shall relieve the Corporation
of any liability in respect of the non-issuance or sale of such Shares as to
which such requisite authority shall not have been obtained.
As a condition to the exercise of an Option, the Company may require
the person exercising such 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 by any of
the aforementioned relevant provisions of law.
16. RESERVATION OF SHARES.
The Corporation, during the term of this Plan, will at all times
reserve and keep available a number of Shares as shall be sufficient to
satisfy the requirements of the Plan.
17. SUBSTITUTION OF OPTIONS.
Options may be issued hereunder in substitution for Options granted by
other companies. Where such Options are issued in substitution for Options
granted prior to January 1, 1987 they shall include such provisions as were
required to conform the prior Options intended to be treated as Incentive Stock
Options to the requirements of Sections 422A(b)(7) and (8) of the Internal
Revenue
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Code of 1954, and may, to the extent not required in connection with such
substitution, omit the limitation at Section 5.2 hereof.
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