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EXHIBIT 4.8
PLASMA-THERM, INC.
1995 STOCK INCENTIVE PLAN
AS ADOPTED BY THE BOARD OF DIRECTORS
AND THE STOCK OPTION COMMITTEE
ON MARCH 17, 1995
AND AS AMENDED AND RESTATED EFFECTIVE AS OF MAY 6, 1997
1. Purpose. Plasma-Therm, Inc., a Florida corporation (the
"Company"), hereby amends and restates the Plasma-Therm, Inc. 1995 Stock
Incentive Plan (the "Plan"). The Plan is intended to recognize the
contributions made to the Company by employees (including employees who are
members of the Board of Directors) of the Company or any Affiliate, to provide
such persons with additional incentive to devote themselves to the future
success of the Company or an Affiliate, and to improve the ability of the
Company or an Affiliate to attract, retain, and motivate individuals upon whom
the Company's sustained growth and financial success depend, by providing such
persons with an opportunity to acquire or increase their proprietary interest
in the Company through receipt of rights to acquire the Company's Common Stock,
par value $.01 per Share (the "Common Stock") and through the transfer or
issuance of Common Stock. In addition, the Plan is intended as an additional
incentive to directors of the Company who are not employees of the Company or
an Affiliate to serve on the Board of Directors and to devote themselves to the
future success of the Company by providing them with an opportunity to acquire
or increase their proprietary interest in the Company through the receipt of
rights to acquire Common Stock. Furthermore, the Plan may be used to encourage
consultants and advisors of the Company to further the success of the Company.
2. Definitions. Unless the context clearly indicates otherwise,
the following terms shall have the following meanings:
(a) "Affiliate" means a corporation which is a parent
corporation or a subsidiary corporation with respect to the Company within the
meaning of Section 424(e) or (f) of the Code.
(b) "Award" shall mean a transfer of Common Stock made
pursuant to the terms of the Plan.
(c) "Award Agreement" shall mean the agreement between
the Company and a Grantee with respect to an Award made pursuant to the Plan.
(d) "Board of Directors" means the Board of Directors of
the Company.
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(e) "Change of Control" shall have the meaning as set
forth in Section 10 of the Plan.
(f) "Code" means the Internal Revenue Code of 1986, as
amended.
(g) "Committee" shall have the meaning set forth in
Section 3 of the Plan.
(h) "Common Stock" shall have the meaning set forth in
Section 1 of the Plan.
(i) "Company" means Plasma-Therm, Inc., a Florida
corporation.
(j) "Disability" shall have the meaning set forth in
Section 22(e)(3) of the Code.
(k) "Employee" means an employee of the Company or an
Affiliate.
(l) "Fair Market Value" shall have the meaning set forth
in Subsection 8(b) of the Plan.
(m) "Grantee" shall mean a person to whom an Award has
been granted pursuant to the Plan.
(n) "ISO" means an Option granted under the Plan which is
intended to qualify as an "incentive stock option" within the meaning of
Section 422(b) of the Code.
(o) "Non-Employee Director" shall mean a member of the
Board of Directors of the Company who is a "non-employee director" as that term
is defined in paragraph (b)(3) of Rule 16b-3 [and an "outside director" as that
term is defined in Treasury Regulations Section 1.162-27 promulgated under the
Code].
(p) "Non-qualified Stock Option" means an Option granted
under the Plan which is not intended to qualify, or otherwise does not qualify,
as an "incentive stock option" within the meaning of Section 422(b) of the
Code.
(q) "Option" means either an ISO or a Non-qualified Stock
Option granted under the Plan.
(r) "Optionee" means a person to whom an Option has been
granted under the Plan, which Option has not been exercised and has not expired
or terminated.
(s) "Option Document" means the document described in
Section 8 or Section 9 of the Plan, as applicable, which sets forth the terms
and conditions of each grant of Options.
(t) "Option Price" means the price at which Shares may be
purchased upon exercise of an Option, as calculated pursuant to Subsection 8(b)
of the Plan.
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(u) "Rule 16b-3" means Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended.
(v) "SAR" shall have the meaning set forth in Section 12
of the Plan.
(w) "Section 16 Officers" means any person who is an
"officer" within the meaning of Rule 16a-1(f) promulgated under the Securities
Exchange Act of 1934, as amended, or any successor rule.
(x) "Shares" means the shares of Common Stock of the
Company which are the subject of Options or granted as Awards under the Plan.
3. Administration of the Plan. The Board of Directors may
designate a committee or committees composed of two or more of directors, each
of whom is a Non-employee Director, to operate and administer the Plan with
respect to all or a designated portion of the participants. Any such committee
designated by the Board of Directors, and the Board of Directors itself in its
administrative capacity with respect to the Plan, is referred to as the
"Committee." With the exception of the timing of grants of Options, the price
at which Shares may be purchased, and the number of Shares covered by Options
granted to each member of the Committee, all of which shall be as specifically
set forth in Section 9, the other provisions set forth herein, as it pertains
to members of the Committee, may be administered by the Board of Directors.
(a) Meetings. The Committee shall hold meetings at such
times and places as it may determine, shall keep minutes of its meetings, and
shall adopt, amend and revoke such rules or procedures as it may deem proper;
provided, however, that it may take action only upon the agreement of a
majority of the whole Committee. Any action which the Committee shall take
through a written instrument signed by a majority of its members shall be as
effective as though it had been taken at a meeting duly called and held.
(b) Exculpation. No member of the Board of Directors
shall be personally liable for monetary damages for any action taken or any
failure to take any action in connection with the administration of the Plan or
the granting of Options or Awards under the Plan, provided that this Subsection
3(b) shall not apply to (i) any breach of such member's duty of loyalty to the
Company, an Affiliate, or the Company's stockholders, (ii) acts or omissions
not in good faith or involving intentional misconduct or a knowing violation of
law, (iii) acts or omissions that would result in liability under applicable
law, and (iv) any transaction from which the member derived an improper
personal benefit.
(c) Indemnification. Service on the Committee shall
constitute service as a member of the Board of Directors of the Company. Each
member of the Committee shall be entitled, without further act on his part, to
indemnity from the Company and limitation of liability to the fullest extent
provided by applicable law and by the Company's Articles of Incorporation
and/or By-law in connection with or arising out of any action, suit or
proceeding with respect to the administration of the Plan or the granting of
Options or Awards thereunder in which he or she may be involved by reason of
his or her being or having been a member of
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the Committee, whether or not he or she continues to be such member of the
Committee at the time of the action, suit or proceeding.
(d) Interpretation. The Committee shall have the power
and authority to interpret the Plan and to adopt rules and regulations for its
administration that are not inconsistent with the express terms of the Plan.
Any such actions by the Committee shall be final, binding and conclusive on all
parties in interest.
4. Grants under the Plan. Grants under the Plan may be in the
form of a Non-qualified Stock Option, an ISO or a combination thereof, at the
discretion of the Committee.
5. Eligibility. All Employees, members of the Board of Directors
and consultants and advisors to the Company shall be eligible to receive
Options and Awards hereunder. Consultants and advisors shall be eligible only
if they render bona fide services to the Company unrelated to the offer or sale
of securities. The Committee, in its sole discretion, shall determine whether
an individual qualifies as an employee.
6. Shares Subject to Plan. The aggregate maximum number of Shares
for which Awards or Options may be granted pursuant to the Plan is 2,706,757
(including Options and Awards granted under the Plan prior to the effective
date of this amended and restated Plan), increased on November 30 of each year
from and including November 30, 1997 by a number of shares equal to one percent
(1%) of the number of shares of Common Stock outstanding on such date;
provided, however, that any such increase shall be made only to the extent that
the Company has sufficient authorized and unreserved Common Stock for such
purpose; and further provided that the maximum aggregate number of Shares to be
issued under the Plan shall not exceed 3,000,000. Such increase shall be made
each November 30, regardless of the number of shares remaining available for
issuance under the Plan on such date. The number of shares which may be issued
under the Plan shall be further subject to adjustment in accordance with
Section 11. The Shares shall be issued from authorized and unissued Common
Stock or Common Stock held in or hereafter acquired for the treasury of the
Company. If an Option terminates or expires without having been fully exercised
for any reason or if Shares subject to an Award have been conveyed back to the
Company pursuant to the terms of an Award Agreement, the Shares for which the
Option was not exercised or the Shares that were conveyed back to the Company
may again be the subject of one or more Options or Awards granted pursuant to
the Plan.
7. Term of the Plan. The Plan (as amended and restated herein) is
effective as of May 6, 1997, provided it is approved on or about such date by
the stockholders in the manner required by state law. If the Plan is not so
approved by the stockholders, this amended and restated Plan shall be null and
void and the Plan as in effect without regard to this amendment and restatement
shall continue in effect under its own terms. No ISO may be granted under the
Plan after March 16, 2005.
8. Option Documents and Terms. Each Option granted under the Plan
shall be a Non-qualified Stock Option unless the Option shall be specifically
designated at the time of grant to be an ISO for Federal income tax purposes.
If any Option designated an ISO is determined for any reason not to qualify as
an incentive stock option within the meaning of
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Section 422 of the Code, such Option shall be treated as a Non-qualified Stock
Option for all purposes under the provisions of the Plan. Options granted
pursuant to the Plan shall be evidenced by the Option Documents in such form as
the Committee shall from time to time approve, which Option Documents shall
comply with and be subject to the following terms and conditions and such other
terms and conditions as the Committee shall from time to time require which are
not inconsistent with the terms of the Plan. However, the provisions of this
Section 8 shall not be applicable to Options granted to members of the
Committee, except as otherwise provided in Subsection 9(c).
(a) Number of Option Shares. Each Option Document shall
state the number of Shares to which it pertains. An Optionee may receive more
than one Option, which may include Options which are intended to be ISO's and
Options which are not intended to be ISO's, but only on the terms and subject
to the conditions and restrictions of the Plan. Notwithstanding anything herein
to the contrary, no Optionee shall be granted Options during one fiscal year of
the Company for more than Five Hundred Thousand (500,000) Shares (such number
to be subject to adjustment in accordance with Section 11).
(b) Option Price. Subject to the provisions of Section 9
hereof, each Option Document shall state the Option Price which, for a
Non-qualified Stock Option, may be less than, equal to, or greater than the
Fair Market Value of the Shares on the date the Option is granted and, for an
ISO, shall be at least 100% of the Fair Market Value of the Shares on the date
the Option is granted as determined by the Committee in accordance with this
Subsection 8(b); provided, however, that if an ISO is granted to an Optionee
who then owns, directly or by attribution under Section 424(d) of the Code,
shares possessing more than ten percent of the total combined voting power of
all classes of stock of the Company or an Affiliate, then the Option Price
shall be at least 110% of the Fair Market Value of the Shares on the date the
Option is granted. If the Common Stock is traded in a public market, then the
Fair Market Value per share shall be, if the Common Stock is listed on a
national securities exchange or included in the NASDAQ System, the last
reported sale price thereof on the relevant date, or, if the Common Stock is
not so listed or included, the mean between the last reported "bid" and "asked"
prices thereof on the relevant date, as reported on NASDAQ or, if not so
reported, as reported by the National Daily Quotation Bureau, Inc. or as
reported in a customary financial reporting service, as applicable and as the
Committee determines.
(c) Exercise. No Option shall be deemed to have been
exercised prior to the receipt by the Company of written notice of such
exercise and (unless arrangements satisfactory to the Company have been made
for payment through a broker in accordance with procedures permitted by
Regulation T of the Federal Reserve Board) of payment in full of the Option
Price for the Shares to be purchased. Each such notice shall specify the number
of Shares to be purchased and shall (unless the Shares are covered by a then
current registration statement or a Notification under Regulation A under the
Securities Act of 1933, as amended (the "Act")), contain the Optionee's
acknowledgment in form and substance satisfactory to the Company that (a) such
Shares are being purchased for investment and not for distribution or resale
(other than a distribution or resale which, in the opinion of counsel
satisfactory to the Company, may be made without violating the registration
provisions of the Act), (b) the Optionee has been advised and understands that
(i) the Shares have not been registered under the Act and are "restricted
securities" within the meaning of Rule 144 under the Act and are subject to
restrictions on transfer and (ii) the Company is under no obligation to
register the Shares under the Act or to take any action which would make
available to the Optionee any exemption from such registration, (c) such Shares
may not be transferred without compliance
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with all applicable federal and state securities laws, and (d) an appropriate
legend referring to the foregoing restrictions on transfer and any other
restrictions imposed under the Option Documents may be endorsed on the
certificates. Notwithstanding the foregoing, if the Company determines that
issuance of Shares should be delayed pending (A) registration under federal or
state securities laws, (B) the receipt of an opinion of counsel satisfactory to
the Company that an appropriate exemption from such registration is available,
(C) the listing or inclusion of the Shares on any securities exchange or an
automated quotation system or (D) the consent or approval of any governmental
regulatory body whose consent or approval is necessary in connection with the
issuance of such Shares, the Company may defer exercise of any Option granted
hereunder until any of the events described in this sentence has occurred.
(d) Medium of Payment. Subject to the terms of the
applicable Option Document, an Optionee shall pay for Shares (i) in cash, (ii)
by certified or cashier's check payable to the order of the Company, or (iii)
by such other mode of payment as the Committee may approve, including payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board. The Optionee may also exercise the Option in any manner
contemplated by Section 12. Furthermore, the Committee may provide in an
Option Document that payment may be made in whole or in part in shares of the
Company's Common Stock held by the Optionee. If payment is made in whole or in
part in shares of the Company's Common Stock, then the Optionee shall deliver
to the Company certificates registered in the name of such Optionee
representing the shares owned by such Optionee, free of all liens, claims and
encumbrances of every kind and having an aggregate Fair Market Value on the
date of delivery that is at least as great as the Option Price of the Shares
(or relevant portion thereof) with respect to which such Option is to be
exercised by the payment in shares of Common Stock, endorsed in blank or
accompanied by stock powers duly endorsed in blank by the Optionee. In the
event that certificates for shares of the Company's Common Stock delivered to
the Company represent a number of shares in excess of the number of shares
required to make payment for the Option Price of the Shares (or relevant
portion thereof) with respect to which such Option is to be exercised by
payment in shares of Common Stock, the stock certificate or certificates issued
to the Optionee shall represent (i) the Shares in respect of which payment is
made, and (ii) such excess number of shares. Notwithstanding the foregoing, the
Committee may impose from time to time such limitations and prohibitions on the
use of shares of the Common Stock to exercise an Option as it deems
appropriate.
(e) Termination of Options.
(i) No Option shall be exercisable after the
first to occur of the following:
(A) Expiration of the Option term
specified in the Option Document, which, in the case of an ISO, shall not occur
after (1) ten years from the date of grant, or (2) five years from the date of
grant if the Optionee on the date of grant owns, directly or by attribution
under Section 424(d) of the Code, shares possessing more than ten percent (10%)
of the total combined voting power of all classes of stock of the Company or of
an Affiliate;
(B) Except to the extent otherwise
provided in an Optionee's Option Document, a finding by the Committee, after
full consideration of the facts presented on behalf of both the Company and the
Optionee, that the Optionee has been engaged in disloyalty to the Company or an
Affiliate, including, without limitation, fraud, embezzlement, theft,
commission of a felony or proven dishonesty in the course of his
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employment or service, or has disclosed trade secrets or confidential
information of the Company or an Affiliate. In such event, in addition to
immediate termination of the Option, the Optionee shall automatically forfeit
all Shares for which the Company has not yet delivered the share certificates
upon refund by the Company of the Option Price. Notwithstanding anything herein
to the contrary, the Company may withhold delivery of share certificates
pending the resolution of any inquiry that could lead to a finding resulting in
a forfeiture;
(C) The date, if any, set by the Board
of Directors as an accelerated expiration date in the event of the liquidation
or dissolution of the Company; or
(D) The occurrence of such other event
or events as may be set forth in the Option Document as causing an accelerated
expiration of the Option.
(E) Except as otherwise set forth in the
Option Document and subject to the foregoing provisions of this Subsection
8(e), three months after the Optionee's employment or service with the Company
or its Affiliates terminates for any reason other than Disability or death or
one year after such termination due to Optionee's Disability or death. With
respect to this Subsections 8(e)(i)(E), the only Options that may be exercised
during the three-month or one-year period, as the case may be, are Options
which were exercisable on the last date of such employment or service and not
Options which, if the Optionee were still employed or rendering service during
such three-month or one-year period, would become exercisable, unless the
Option Document specifically provides to the contrary. The terms of an
executive severance agreement or other agreement between the Company and an
Optionee, approved by the Committee, whether entered into prior or subsequent
to the grant of an Option, which provide for Option exercise dates later than
those set forth in Subsection 8(e)(i) shall be deemed to be Option terms
approved by the Committee and consented to by the Optionee.
(ii) Notwithstanding the foregoing, the Committee
may extend the period during which all or any portion of an Option may be
exercised to a date no later than the Option term specified in the Option
Document pursuant to Subsection 8(e)(i)(A), provided that any change pursuant
to this Subsection 8(e)(ii) which would cause an ISO to become a Non-qualified
Stock Option may be made only with the consent of the Optionee.
(iii) Notwithstanding anything to the contrary
contained in the Plan or an Option Document, an ISO shall be treated as a
Non-qualified Stock Option to the extent such ISO is exercised at any time
after the expiration of the time period permitted under the Code for the
exercise of an ISO.
(f) Transfers. No Option granted under the Plan may be
transferred, except by will or by the laws of descent and distribution. During
the lifetime of the person to whom an Option is granted, such Option may be
exercised only by him. Notwithstanding the foregoing, an Option, other than an
ISO, shall be transferrable pursuant to a "qualified domestic relations order"
as defined in the Code and also shall be transferrable, without payment of
consideration, to (a) immediate family members of the holder (i.e. spouse or
former spouse, parents, issue, including adopted and "step" issue or siblings),
(b) trusts for the benefit of immediate family members, and (c) partnerships
whose only partners are such family members. Any transferee will be subject to
all of the conditions set forth in the Option prior to its transfer.
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(g) Limitation on ISO Grants. To the extent that the
aggregate fair market value of the shares of Common Stock (determined at the
time the ISO is granted) with respect to which ISO's under all incentive stock
option plans of the Company or its Affiliates are exercisable for the first
time by the Optionee during any calendar year exceeds $100,000, such ISO's
shall, to the extent of such excess, be treated as Non-qualified Stock Options.
(h) Other Provisions. Subject to the provisions of the
Plan, the Option Documents shall contain such other provisions including,
without limitation, provisions authorizing the Committee to accelerate the
exercisability of all or any portion of an Option granted pursuant to the Plan,
additional restrictions upon the exercise of the Option or additional
limitations upon the term of the Option, as the Committee shall deem advisable.
(i) Amendment. Subject to the provisions of the Plan, the
Committee shall have the right to amend any Option Document or Award Agreement
issued to an Optionee or Award holder, subject to the Optionee's or Award
holder's consent if such amendment is not favorable to the Optionee or Award
holder, or if such amendment has the effect of changing an ISO to a
Non-Qualified Stock Option, except that the consent of the Optionee or Award
holder shall not be required for any amendment made pursuant to Subsection
8(e)(i)(C) or Section 10 of the Plan, as applicable.
9. Special Provisions Relating to Grants of Options to members of
the Committee. Options granted pursuant to the Plan to members of the Committee
shall be granted, without any further action by the Committee, in accordance
with the terms and conditions set forth in this Section 9. Options granted
pursuant to this Section 9 shall be evidenced by Option Documents in such form
as the Committee shall from time to time approve, which Option Documents shall
comply with and be subject to the following terms and conditions and such other
terms and conditions as the Committee shall from time to time require which are
not inconsistent with the terms of the Plan. Notwithstanding the foregoing, a
Committee member may elect not to receive a formula option grant (in which case
the Committee member will receive nothing in lieu thereof) and may also revoke
such election. In either case, the election or the revocation of the election
will be effective only for formula option grants that otherwise were scheduled
to be made after the date of the election.
(a) Timing of Grants; Number of Shares Subject of
Options; Exercisability of Options; Option Price. Each member of the Committee
shall be granted on each June 30 annually, commencing on June 30, 1995, an
Option to purchase Five Thousand (5,000) Shares (such number to be subject to
adjustment as provided in Section 11). Each such Option shall be a
Non-qualified Stock Option becoming exercisable with respect to (100%) of the
Shares covered thereby on the first anniversary of the date of grant and
expiring five years after the date of grant. The Option Price shall be equal
to 60% the Fair Market Value of the Shares on the date the Option is granted.
The Option shall permit any method of exercise permitted by Section 12.
(b) Termination of Options Granted Pursuant to Section 9.
All Options granted pursuant to this Section 9 shall be exercisable until the
first to occur of the following:
(i) Expiration of five (5) years from
the date of grant;
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(ii) Expiration of three (3) months from
the date the Optionee's service as a director of the Company terminates for any
reason other than Disability or death; or
(iii) Expiration of one (1) year from the
date the Optionee's service as a director terminates due to the Optionee's
Disability or death.
(c) Applicability of Provisions of Section 8 to Options
Granted Pursuant to Section 9. The following provisions of Section 8 shall be
applicable to Options granted pursuant to this Section 9: Subsection
8(a)(provided that all Options granted pursuant to this Section 9 shall be
Non-qualified Stock Options); the last sentence of Subsection 8(b); Subsection
8(c); Subsection 8(d) (provided that Option Documents relating to Options
granted pursuant to this Section 9 shall provide that payment may be made in
whole or in part in shares of Company Common Stock); Subsection 8(f); and
Subsection 8(i).
10. Change of Control. Except as may be provided in an Option
Document (which will take precedence over the provisions of this Section 10),
in the event of a Change of Control, the Committee may take whatever actions it
deems necessary or desirable with respect to any of the Options outstanding
(other than Options granted pursuant to Section 9), which need not be treated
identically, including, without limitation, accelerating (a) the expiration or
termination date in the respective Option Documents to a date no earlier than
thirty (30) days after notice of such acceleration is given to the Optionees,
or (b) the exercisability of the Option. In the event of a Change of Control,
Options granted pursuant to Section 9 shall accelerate and become exercisable
immediately. Notwithstanding the foregoing, in the event of a Change of
Control, Options granted pursuant to the Plan will become automatically
exercisable in full but only with respect to those Optionees who, in the good
faith determination of the Board of Directors, are likely to have their
relationship with the Company or any Affiliate of the Company terminated
(including constructive termination through a significant decrease in
authority, responsibility or overall total compensation) as a result of such
Change of Control.
A "Change of Control" shall be deemed to have occurred upon
the earliest to occur of the following events:
(i) any "person," as such term is used in Sections 3(a)(9) and
13(d) of the Securities Exchange Act of 1934, other than Ronald H. Deferrari,
his children and/or their respective affiliates and their respective heirs,
executors, administrators and successors, becomes a "beneficial owner," as such
term is used in Rule 13d-3 promulgated under that act, of 50% or more of the
Company's Voting Stock;
(ii) individuals who are Incumbent Directors cease to constitute a
majority of the members of the Board of Directors ("Incumbent Directors" for
this purpose being the members of the Board of Directors on the date of
adoption of this Plan, provided that any person becoming a member of the Board
of Directors subsequent to such date whose election or nomination for election
was supported by two-thirds of the directors who then comprised the Incumbent
Directors shall be considered to be an Incumbent Director);
(iii) the Company adopts any plan of liquidation providing for the
distribution of all or substantially all of its assets;
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(iv) all or substantially all of the business of the Company is
disposed of pursuant to a merger, consolidation or other transaction (unless
the stockholders of the Company immediately prior to such merger, consolidation
or other transaction beneficially own, directly or indirectly, in substantially
the same proportion as they owned the voting stock of the Company, all of the
voting stock or other ownership interests of the entity or entities, if any,
that succeed to the business of the Company);
(v) the Company combines with another company and is the surviving
corporation but, immediately after the combination, the stockholders of the
Company immediately prior to the combination hold, directly or indirectly, 50%
or less of the voting stock entitled to vote for the election of directors of
the combined company (there being excluded from the number of shares held by
such stockholders, but not from the voting stock of the combined company, any
shares received by "affiliates", as such term is defined in the rules of the
Securities and Exchange Commission, of such other company in exchange for stock
of such other company); or
(vi) a "change of control" as defined in the form of indenture
governing any indebtedness of the Company shall have occurred.
11. Adjustments on Changes in Capitalization.
(a) In the event that the outstanding Shares are changed
by reason of a reorganization, merger, consolidation, recapitalization,
reclassification, stock split-up, combination or exchange of shares and the
like (not including the issuance of Common Stock on the conversion of other
securities of the Company which are outstanding on the date of grant and which
are convertible into Common Stock) or dividends payable in Shares, an equitable
adjustment shall be made by the Committee in the aggregate number of shares
available under the Plan and in the number of Shares and price per Share
subject to outstanding Options. Unless the Committee makes other provisions for
the equitable settlement of outstanding options, if the Company shall be
reorganized, consolidated, or merged with another corporation, or if all or
substantially all of the assets of the Company shall be sold or exchanged, an
Optionee shall at the time of issuance of the stock under such corporate event
be entitled to receive upon the exercise of his or her Option the same number
and kind of shares of stock or the same amount of property, cash or securities
as he or she would have been entitled to receive upon the occurrence of any
such corporate event as if he or she had been, immediately prior to such event,
the holder of the number of shares covered by his or her Option.
(b) Any adjustment under this Section 11 in the number of
Shares subject to Options shall apply proportionately to only the unexercised
portion of any Option granted hereunder. If fractions of a Share would result
from any such adjustment, the adjustment shall be revised to the next lower
whole number of Shares.
(c) The Committee shall have authority to determine the
adjustments to be made under this Section, and any such determination by the
Committee shall be final, binding and conclusive.
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12. Stock Appreciation Rights (SARs).
(a) In General. Subject to the terms and conditions of
the Plan, the Committee may, in its sole and absolute discretion, grant to an
Optionee the right to surrender an Option to the Company, in whole or in part,
and to receive in exchange therefor payment by the Company of an amount equal
to the excess of the fair market value of the shares of Common Stock subject to
such Option, or portion thereof, so surrendered (determined in the manner
described in section 8(b) as of the date the SARs are exercised) over the
exercise price to acquire such shares (which right shall be referred to as an
"SAR"). Except as may otherwise be provided in an Option Document, such
payment may be made, as determined by the Committee in accordance with
subsection 12(c) below and set forth in the Option Agreement, either in shares
of Common Stock or in cash or in any combination thereof. Notwithstanding
anything herein to the contrary, an Option granted to a member of the
Disinterested Directors Committee pursuant to Section 9 shall provide for SARs
and the Optionee shall have the right to determine the method of payment to the
Optionee.
(b) Grant. Each SAR shall relate to a specific Option
granted under the Plan and shall be granted to the Optionee concurrently with
the grant of such Option by inclusion of appropriate provisions in the Option
Agreement pertaining thereto. The number of SARs granted to an Optionee shall
not exceed the number of shares of Common Stock which such Optionee is entitled
to purchase pursuant to the related Option. The number of SARs held by an
Optionee shall be reduced by (i) the number of SARs exercised under the
provisions of the Option Agreement pertaining to the related Option, and (ii)
the number of shares of Common Stock purchased pursuant to the exercise of the
related Option.
(c) Payment. The Committee shall have sole discretion to
determine whether payment in respect of SARs granted to any Optionee shall be
made in shares of Common Stock, or in cash, or in a combination thereof, except
that the method of payment shall be determined solely by the Optionee of an
Option granted to a member of the Disinterested Directors Committee pursuant to
Section 9. If payment is made in Common Stock, the number of shares of Common
Stock which shall be issued pursuant to the exercise of SARs shall be
determined by dividing (i) the total number of SARs being exercised, multiplied
by the amount by which the Fair Market Value (as determined under section 8(b))
of a share of Common Stock on the exercise date exceeds the exercise price for
shares covered by the related Option, by (ii) the Fair Market Value of a share
of Common Stock on the exercise date of the SARs. No fractional share of Common
Stock shall be issued on exercise of an SAR; cash may be paid by the Company to
the individual exercising an SAR in lieu of any such fractional share. If
payment on exercise of an SAR is to be made in cash, the individual exercising
the SAR shall receive in respect of each share to which such exercise relates
an amount of money equal to the difference between the Fair Market Value of a
share of Common Stock on the exercise date and the exercise price for shares
covered by the related Option.
(d) Limitations. SARs shall be exercisable at such times
and under such terms and conditions as the Committee, in its sole and absolute
discretion, shall determine; provided, however, that an SAR may be exercised
only at such times and by such individuals as the related Option under the Plan
and the Option Agreement may be exercised.
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13. Terms and Conditions of Awards. Awards granted pursuant to the
Plan shall be evidenced by written Award Agreements in such form as the
Committee shall from time to time approve, which Award Agreements shall comply
with and be subject to the following terms and conditions and such other terms
and conditions which the Committee shall from time to time require which are
not inconsistent with the terms of the Plan.
(a) Number of Shares. Each Award Agreement shall state
the number of shares of Common Stock to which it pertains.
(b) Purchase Price. Each Award Agreement shall specify
the purchase price, if any, which applies to the Award. If the Board specifies
a purchase price, the Grantee shall be required to make payment on or before
the date specified in the Award Agreement. A Grantee shall pay for Shares (i)
in cash, (ii) by certified check payable to the order of the Company, or (iii)
by such other mode of payment as the Committee may approve.
(c) Grant. In the case of an Award which provides for a
grant of Shares without any payment by the Grantee, the grant shall take place
on the date specified in the Award Agreement. In the case of an Award which
provides for a payment, the grant shall take place on the date the initial
payment is delivered to the Company, unless the Committee or the Award
Agreement otherwise specifies. Stock certificates evidencing Shares granted
pursuant to an Award shall be issued in the sole name of the Grantee.
Notwithstanding the foregoing, as a precondition to a grant, the Company may
require an acknowledgment by the Grantee as required with respect to Options
under Section 8.
(d) Conditions. The Committee may specify in an Award
Agreement any conditions under which the Grantee of that Award shall be
required to convey to the Company the Shares covered by the Award. Upon the
occurrence of any such specified condition, the Grantee shall forthwith
surrender and deliver to the Company the certificates evidencing such Shares as
well as completely executed instruments of conveyance. The Committee, in its
discretion, may provide that certificates for Shares transferred pursuant to an
Award be held in escrow by the Company or an officer of the Company until such
time as each and every condition has lapsed and that the Grantee be required,
as a condition of the Award, to deliver to such escrow agent or Company officer
stock powers covering the Award Shares duly endorsed by the Grantee. Unless
otherwise provided in the Award Agreement, distributions made on Shares held in
escrow will be deposited in escrow, to be distributed to the party becoming
entitled to the Shares on which the distribution was made. Stock certificates
evidencing Shares subject to conditions shall bear a legend to the effect that
the Common Stock evidenced thereby is subject to repurchase or conveyance to
the Company in accordance with an Award made under the Plan and that the Shares
may not be sold or otherwise transferred.
(e) Lapse of Conditions. Upon termination or lapse of
each and every forfeiture condition, the Company shall cause certificates
without the legend referring to the Company's repurchase right (but with any
other legends that may be appropriate) evidencing the Shares covered by the
Award to be issued to the Grantee upon the Grantee's surrender of the legended
certificates held by him to the Company.
(f) Rights as Stockholder. Upon payment of the purchase
price, if any, for Shares covered by an Award and compliance with the
acknowledgment requirement
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of subsection 13(c), the Grantee shall have all of the rights of a stockholder
with respect to the Shares covered thereby, including the right to vote the
Shares and receive all dividends and other distributions paid or made with
respect thereto, except to the extent otherwise provided by the Committee or in
the Award Agreement.
14. Amendment of the Plan. The Board of Directors of the Company
may amend the Plan from time to time in such manner as it may deem advisable.
Nevertheless, the Board of Directors of the Company may not change the class of
individuals eligible to receive an ISO or increase the maximum number of shares
as to which Options may be granted without obtaining approval, within twelve
months before or after such action, by the stockholders in the manner required
by state law. In addition, the provisions of Section 9 that determine (i) which
directors shall be granted Options pursuant to Section 9; (ii) the amount of
Shares subject to Options granted pursuant to Section 9; (iii) the price at
which shares subject to Options granted pursuant to Section 9 may be purchased
and (iv) the timing of grants of Options pursuant to Section 9 shall not be
amended more than once every six months, other than to comport with changes in
the Code or the Employee Retirement Income Security Act of 1974, as amended. No
amendment to the Plan shall adversely affect any outstanding Option, however,
without the consent of the Optionee.
15. No Commitment to Retain. The grant of an Option or Award
pursuant to the Plan shall not be construed to imply or to constitute evidence
of any agreement, express or implied, on the part of the Company or any
Affiliate to retain the Optionee or Grantee as an employee, consultant or
advisor of the Company or any Affiliate, as a member of the Company's Board of
Directors or in any other capacity.
16. Withholding of Taxes. In connection with any event relating to
an Option or Award, the Company shall have the right to (a) require the
recipient to remit or otherwise make available to the Company an amount
sufficient to satisfy any federal, state and/or local withholding tax
requirements prior to the delivery or transfer of any certificate or
certificates for such Shares or (b) take whatever other action it deems
necessary to protect its interests with respect to tax liabilities. The
Company's obligations under the Plan shall be conditioned on the Optionee's or
Grantee's compliance, to the Company's satisfaction, with any withholding
requirement.
17. Interpretation. The Plan is intended to enable transactions
under the Plan with respect to directors to satisfy the conditions of Rule
16b-3; to the extent that any provision of the Plan would cause a conflict with
such conditions or would cause the administration of the Plan as provided in
Section 3 to fail to satisfy the conditions of Rule 16b-3, such provision shall
be deemed null and void to the extent permitted by applicable law. This section
shall not be applicable if no class of the Company's equity securities is then
registered pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended.
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