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EXHIBIT 4.1
REXON INCORPORATED
NEW EMPLOYEE STOCK OPTION PLAN
1. PURPOSE.
The purpose of this New Employee Stock Option Plan is to assist the
Company in attracting and motivating qualified new employees and consultants
and to provide a means whereby such persons will be given an opportunity to
purchase stock in the Company.
2. DEFINITIONS.
When used in this Plan, unless the context otherwise requires, the
following definitions shall apply:
(a) "Board of Directors" shall mean the Board of
Directors of the Company as constituted at any time.
(b) "Code" shall mean the Internal Revenue Code, as
presently in effect and as may be hereafter amended from time to time, and any
regulations promulgated thereunder.
(c) "Committee" shall mean the Committee as hereinafter
described in Section 3.
(d) "Company" shall mean REXON INCORPORATED.
(e) "Consultant" shall mean any person who is engaged by
the Company or any of its Subsidiaries to render consulting services.
(f) "Employee" shall mean any person, but excluding any
officer or director, employed by the Company or any Subsidiary.
(g) "Fair Market Value" shall mean the average of the
highest bid price and lowest ask price of the Company's Common Stock, as
reported by NASDAQ (or, if such shares are then listed on any national
securities exchange or quoted on the NASDAQ National Market System, the closing
price on such exchange or in such system) on the date of or immediately
preceding the grant of the Option, whichever is applicable.
(h) "Non-qualified Option" shall mean any Option granted
under the Plan not intended to meet the requirements for an "Incentive Option"
as defined in the Code.
(i) "Optionee" shall mean any person to whom an Option
has been granted under the Plan.
(j) "Option" shall mean a stock option issued pursuant to
the Plan.
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(k) "Participant" shall mean any person who is eligible to
receive an Option under Section 4 of the Plan.
(l) "Plan" shall mean the New Employee Stock Option Plan
of the Company, as may be amended from time to time as herein provided.
(m) "Share" shall mean a share of Common Stock of the
Company.
(n) "Subsidiary" shall mean any corporation in which the
Company owns, directly or indirectly, stock possessing 50 percent or more of
the total combined voting power of all classes of stock.
3. ADMINISTRATION.
3.1 The Plan shall be administered by the Board of Directors or by
a Committee which shall consist of not less than two (2) members of the Board
of Directors of the Company, as may be appointed by the Board of Directors.
The Board and the Committee shall have full power and authority to construe,
interpret and administer the Plan, to grant Options under the Plan and to make
determinations which shall be final, conclusive and binding upon all persons,
including but not limited to the Company, the stockholders and any persons
having an interest in any Options. If a member of the Committee, for any
reason, shall cease to serve, the vacancy may be filled by the Board of
Directors. Any member of the Committee may be removed at any time, with or
without cause, by the Board of Directors.
3.2 The determination of the Board of Directors or the Committee
as to any questions which may arise with respect to the interpretation of the
provisions of the Plan and Options granted thereunder shall be final and
conclusive.
3.3 The Board of Directors or the Committee may make such
adjustments to Options granted under the Plan to enable them to comply with the
laws of foreign jurisdictions and/or to make them consistent with options
customarily utilized by companies in foreign jurisdictions.
3.4 The Board of Directors or the Committee may authorize and
establish such rules, regulations and revisions thereof, not inconsistent with
the provisions of the Plan, as it may determine advisable to make the Plan and
Options effective or provide for their administration, and may take such other
action with regard to the Plan and Options as it shall deem desirable to
effectuate their purpose.
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4. ELIGIBILITY.
Options may be granted only to Employees and Consultants who have
become employed by, or who have commenced to provide consulting services to,
the Company within sixty (60) days prior to the grant of an Option under the
Plan. Neither directors nor officers of the Company, nor persons hired as
such, shall be eligible to receive an Option under the Plan, regardless of his
or her date of hire.
5. SHARES SUBJECT TO THE PLAN.
5.1 Subject to the provisions of Section 12 (relating to
adjustment upon changes in stock), the shares which may be sold pursuant to
Options granted under the Plan shall not exceed in the aggregate 185,000 shares
of the Company's authorized Common Stock. If any Options under the Plan shall
for any reason terminate or expire without having been exercised in full, the
shares not purchased under such Options shall be available again for grant and
purchase under the Plan.
5.2 Notwithstanding Section 5.1 above, the maximum aggregate
number of shares subject to the Plan may be automatically increased by the
Board, at its discretion, by an additional 185,000 shares if it determines in
connection with an acquisition of another business (whether by merger,
consolidation or purchase of assets or otherwise) that it is necessary to grant
new options to employees or other optionees of such acquired business to
replace options or other equity rights previously granted to such persons by
the acquired business. The amount of the additional number of shares to become
subject to the Plan shall not exceed the number of new Options granted in
connection with such acquisition, and in no event shall exceed 185,000 option
shares.
6. ISSUANCE OF OPTIONS; SELECTION OF OPTIONEE.
6.1 The number of shares to be optioned to any Participant shall
be determined by the Board of Directors or by the Committee in its sole
discretion. Only Non-Qualified Options may be granted under the Plan.
6.2 In determining which Participants should receive Options and
the number of shares subject thereto, the Board of Directors or the Committee
may consider the nature of service, compensation levels, anticipated
contributions to the success of the Company and such other factors as the Board
or Committee may deem relevant. Options may be issued at different times to
the same Participant, but subject to Section 4 of the Plan. The form of
Option, including the terms and provisions thereof, shall be as determined from
time to time by the Board or the Committee, and each Option issued may contain
terms and provisions different from other Options granted to the same or other
Option recipients. An Option
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Agreement, signed by an officer of the Company (and, if the Committee deems
advisable, by the Participant), shall be issued to each Optionee to whom an
Option is granted.
7. EXERCISE PRICE.
The exercise price for the Shares to be purchased pursuant to the
exercise of any Option shall be fixed by the Board of Directors or the
Committee at the time of the grant of the Option. The exercise price of any
Option shall not be less than 100% of the Fair Market Value of the Shares on
the date such Option is granted. Notwithstanding the foregoing, such exercise
price limitations shall not be applicable to any Options exchanged for other
stock options previously issued by the Company or any Subsidiary on the basis
of an exchange offer made to holders of such previously-issued options based
upon the fair market value thereof.
8. DURATION OF OPTION.
The duration of any Option granted under the Plan shall be for a
period not to exceed ten (10) years and one (1) month from the date on which it
is granted, as determined by the Board of Directors or the Committee.
9. NON-TRANSFERABILITY OF OPTIONS.
Options shall not be transferrable by the holder thereof otherwise
than (i) by will, (ii) pursuant to the laws of descent and distribution or
(iii) pursuant to a qualified domestic relations order as defined by the Code
or by Title I of the Employee Retirement Income Security Act (ERISA), or the
rules thereunder; provided, however, that an Optionee may designate a
beneficiary who, upon Optionee's death, may exercise the Option to the extent
permitted in the Plan.
10. EXERCISE OF OPTIONS; PAYMENT OF THE PURCHASE PRICE.
10.1 Except as otherwise provided herein, an Option, after the
issuance thereof, shall be exercisable in accordance with the Plan immediately
or in such installments as may be fixed by the Board of Directors or the
Committee. Notwithstanding anything to the contrary contained herein or in any
Option Agreement, all outstanding unexercised Options shall become fully vested
and may be exercised in whole or in part, at the election of Optionee, as
follows:
(a) Immediately upon a change in the composition of the
Board, not approved by a majority of the directors in office at the time of
such change, which results in a change in "control" of the Company, as such
term is defined in Rule 405 promulgated by the Securities and Exchange
Commission under the Securities Act of 1933, as amended;
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(b) Between thirty (30) and fifteen (15) days prior to
the intended consummation or closing date of any reorganization, merger,
consolidation, liquidation, sale of all or substantially all of the Company's
assets other than a sale or transfer to a Subsidiary of the Company, or similar
transaction pursuant to which the Company is not the surviving corporation;
provided, however, such Options shall not become fully vested or immediately
exercisable if (i) the Board shall determine otherwise, with respect to any or
all holders of Options, but in such event the successor or acquiring
corporation shall substitute for such Option a new stock option containing
terms and conditions which, in the opinion of the Board or Committee, make the
new substituted options comparable, in economic benefit and effect, to the
Options previously held, or (ii) if such transaction is effected by the Company
for the principal purpose of changing the Company's state of incorporation; or
(c) Upon the occurrence of such special circumstances or
events as in the opinion of the Board of Directors or the Committee merits
special consideration.
10.2 An Option shall be exercised by the delivery of a duly signed
notice in writing to such effect, together with the full purchase price.
Payment of the purchase price shall be made in cash or, at the discretion of
the Board of Directors or the Committee as set forth in the Option Agreement or
otherwise, in any other lawful form of consideration, including (i) delivering
outstanding Common Stock of the Company previously owned for six months by the
Optionee (valued at Fair Market Value), or (ii) a promissory note. The terms
of such promissory note shall be determined by the Board of Directors or the
Committee; provided, however, that no part of such note shall be payable later
than five years from the date of purchase of the shares, and the unpaid balance
shall bear interest at any rate determined reasonable or appropriate by the
Board or the Committee, which shall be payable quarterly. If the Board or
Committee permits payment of all or any part of the purchase price by delivery
of a promissory note, the Optionee shall give such security, including but not
limited to the shares purchased, as the Board of Directors or the Committee may
request.
10.3 The Company will, as soon as practicable after the exercise of
an Option, deliver to the person entitled thereto a certificate for the Shares
purchased pursuant to the exercise of the Option; provided, however, that such
certificate may be held by the Company pursuant to Section 10.2 and may also be
held pending receipt of any taxes required to be collected or withheld from
Optionee at the date of exercise of an Option.
10.4 Option Agreements under the Plan may contain a provision to
the effect that all Federal and state taxes required to be withheld or
collected from an Optionee upon exercise of an Option may be satisfied by
either (i) delivering outstanding Common Stock
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of the Company previously owned for six (6) months by the Optionee or (ii) the
withholding of a sufficient number of exercised Option shares which, valued at
fair market value on the date of exercise, would be equal to the total
withholding obligation of Optionee; provided, however, that no person who is an
"officer" of the Company as such term is defined in Rule 3b-2 under the
Securities Exchange Act of 1934 may elect to satisfy the withholding of Federal
and state taxes upon the exercise of an Option by the withholding of optioned
shares unless such election is made either (a) pursuant to an irrevocable
election made by the Participant at least six months prior to the date that the
exercise of the Option becomes a taxable event or (b) during any of the periods
beginning on the third business day following the date on which the Company
issues a release containing the operating results of a fiscal quarter or fiscal
year and ending on the twelfth business day following such date. Such election
to withhold optioned shares shall be deemed made upon receipt of notice thereof
by an officer of the Company, by mail, personal delivery or by facsimile
message, and shall (unless notice to the contrary is provided to the Company)
be operative for all option exercises which occur following the election.
10.5 Whenever an Optionee exercises an Option by surrendering
already-owned shares to pay all or a portion of the exercise price, if the
Option Agreement so provides or if permitted by the Board or the Committee at
its discretion, at the time of such exercise the Optionee shall receive a new
Option for the purchase of a number of shares equal to the number of shares so
surrendered, and such new option shall have an exercise price of not less than
the fair market value of a share of Company Common Stock on the date of such
surrender and shall vest and become exercisable as may be determined by the
Board.
11. TERMINATION OF EMPLOYMENT OR CONSULTING SERVICES; DEATH OF OPTIONEE.
11.1 If a holder of an Option who is either an employee of or
consultant to the Company shall voluntarily or involuntarily leave the employ
of or cease to render consulting services to the Company or any Subsidiary, the
Option of such holder shall terminate, except that, subject to the limitation
hereafter stated in this Section 11, (i) if his termination results from any
reason other than his death, he may at any time within three months after
termination of his services (or such longer period, not to exceed twelve
months, as may be approved by the Board of Directors of the Committee) exercise
his Option but only to the extent that it was exercisable by him on the date of
termination and only in the absence of the circumstances set forth in Section
11.2 below; (ii) if he is re-hired or retained as an employee of or consultant
to the Company within eighteen (18) months after his termination, his Option
may, if approved by the Board of Directors or the Committee, be reinstated and
again becomes exercisable in accordance with its
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New Employee Stock Option Plan
original terms (but if his Option was originally an Incentive Option it shall
be reinstated or reissued only as a Non-qualified Option); and (iii) if he dies
while in the employ of or as a Consultant to the Company or a Subsidiary, or
within three months after termination of his employment or his consulting
services, his Option may be exercised by the person or persons to whom his
rights under the Option shall pass by will or by the laws of descent or
distribution, provided such exercise is effectuated within two (2) years
following the date of death. In no event may an Option be exercised to any
extent by anyone after the expiration of its term.
11.2 If the holder of an Option (i) is terminated due to his
willful refusal to perform the normal duties or assume the reasonable
responsibilities delegated to him as an employee of or consultant to the
Company, (ii) is terminated due to his expropriation of Company property
(including trade secrets or other proprietary rights), or (iii) leaves the
employment of the Company in order to directly (or indirectly, as an employee
or agent of another business or business entity) compete with the Company, the
Board shall have the authority, by notice to the holder of an Option, to
immediately terminate such Option, effective on the date of termination, and
such Option shall no longer be exercisable to any extent whatsoever.
11.3 An Option granted to an eligible Participant pursuant to
Section 4 of the Plan shall not terminate on the sole grounds that he or she is
elected an officer or director of the Company or any Subsidiary thereof
following the grant of the Option.
12. ADJUSTMENT UPON CHANGES IN STOCK.
If any change is made in the shares subject to the Plan, or subject to
any Option granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, split-up, combination of
shares, exchange of shares, change in corporate structure or otherwise),
appropriate adjustments shall be made by the Board of Directors or the
Committee as to the maximum number of shares subject to the Plan, and the
number of shares and exercise price of shares subject to outstanding Options.
13. ISSUANCE OF SHARES AND COMPLIANCE WITH SECURITIES ACT.
The Company may postpone the issuance and delivery of Shares upon any
exercise of an Option until (a) the admission of such Shares to listing on any
stock exchange on which Shares of the Company of the same class are then listed
and (b) either the completion of such registration or other qualification of
such Shares under any state or Federal law, rule or regulation as the Company
shall determine to be necessary or advisable or the completion of all
procedures necessary to obtain exemptions therefrom. Any person exercising an
Option shall make such
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representations and furnish such information as may, in the opinion of counsel
for the Company, be appropriate to permit the Company to issue the Shares in
compliance with the provisions of the Securities Act of 1933, as amended, and
any state statutes which may be applicable.
14. AMENDMENT OF THE PLAN.
Except as hereinafter provided, the Board of Directors or the
Committee may at any time withdraw or from time to time amend the Plan and the
terms and conditions of any Options not theretofore issued, and the Board of
Directors or the Committee, with the consent of the affected holder of an
Option, may at any time withdraw or from time to time amend the Plan and the
terms and conditions of such Options as have been theretofore granted.
15. NO EMPLOYMENT AGREEMENT.
The grant of an Option under the Plan to an Employee of the Company
shall not be deemed to create any agreement to employ the Optionee for any
period of time, it being understood that employment is strictly "at will" in
the absence of any written agreement to the contrary and such person may be
terminated by the Company at any time, with or without cause.
16. EFFECTIVE DATE OF THE PLAN.
The Plan was adopted by the Board of Directors of the Company on
November 4, 1993, and is effective on such date. The effectiveness of the Plan
is not conditioned on or subject to stockholder approval, and options may be
granted under the Plan immediately upon its effective date.
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