Exhibit 10.21
SCRIPTECH PHARMACEUTICALS, INC.
1994 STOCK OPTION PLAN
1. PURPOSE
The purpose of the ScripTech Pharmaceuticals, Inc. 1994 Stock Option Plan
(the "Plan") is to further the growth and development of ScripTech
Pharmaceuticals, Inc. (the "Company") by granting to those persons referred to
in Section 5, as an incentive and encouragement to stock ownership, options to
purchase shares of Common Stock of the Company (the "Stock") and thereby obtain
a proprietary interest in the enterprise and a more direct stake in the
Company's continuing welfare.
Options granted pursuant to the Plan may be incentive stock options as
defined under the Internal Revenue Code of 1986, as from time to time amended
(the "Code") (any option that is intended to qualify as an incentive stock
option being referred to herein as an "incentive option"), or options that do
not qualify as incentive options ("nonstatutory options"), or both.
2. ADMINISTRATION
The Plan shall be administered by the Board of Directors (the "Board") of
the Company. The Board shall have authority, not inconsistent with the express
provisions of the Plan, (a) to grant options to such persons as the Board may
select; (b) to determine the time or times when options shall be granted, when
they shall be exercisable and the number of shares of Stock subject to each
option; (c) to determine whether to grant incentive options or nonstatutory
options or both; (d) to determine the terms and conditions of each option; (e)
to prescribe the form or forms of instruments evidencing options and any other
instruments required under the Plan and to change such forms from time to time;
(f) to adopt, amend and rescind rules and regulations for the administration of
the Plan; and (g) to interpret the Plan and to decide any questions and settle
all controversies and disputes that may arise in connection with the Plan. Such
determinations of the Board shall be conclusive and shall bind all parties.
Subject to Section 9, the Board shall also have the authority, both generally
and in particular instances, to waive compliance by a participant with any
obligation to be performed by him or her under an option and to waive any
condition or provision of an option.
3. EFFECTIVE DATE AND TERM OF PLAN
The Plan shall become effective on the date on which the Plan is approved
by the shareholders of the Company. Grants of options under the Plan may be made
prior to that date (but after adoption of the Plan by the Board), subject to
approval of the Plan by such shareholders.
No option shall be granted under the Plan after the completion of ten
years from the date on which the Plan was adopted by the Board, but options
previously granted may extend beyond that date.
4. SHARES SUBJECT TO THE PLAN
(a) Number of Shares. Subject to adjustment as provided in Section 4(c),
the aggregate number of shares of Stock that may be delivered upon the exercise
of options granted under the Plan shall be 1,885,000. If any option granted
under the Plan terminates without having been exercised in full, the number of
shares of Stock as to which such option was not exercised shall be available for
future grants within the limits set forth in this Section 4(a).
(b) Shares to be Delivered. Shares delivered under the Plan shall be
authorized but unissued Stock or, if the Board so decides, previously issued
Stock acquired by the Company and held in treasury. No fractional shares of
Stock shall be delivered under the Plan.
(c) Changes in Stock. In the event of a stock dividend, stock split or
combination of shares, recapitalization, increase or decrease in the number of
issued shares of capital stock effected without receipt of consideration by the
Company, or other similar change in the Company's capital stock, the number and
kind of shares of stock or securities of the Company subject to options then
outstanding or subsequently granted under the Plan, the maximum number of shares
or securities that may be delivered under the Plan, the exercise price, and
other relevant provisions shall be appropriately adjusted by the Board;
provided, however, that any fractional shares resulting from such adjustment
shall be eliminated. Any determination by the Board of Directors under this
Section 5 shall be binding on all persons.
The Board may also, in its discretion, adjust the number of shares subject
to outstanding options, the exercise price of outstanding options and the terms
of outstanding options, to take into consideration material changes in
accounting practices or principles, consolidations or mergers (except those
described in Section 7), acquisitions or dispositions of stock or property or
any other event if it is determined by the Board that such adjustment is
appropriate to avoid distortion in the operation of the Plan.
5. ELIGIBILITY
Persons eligible to receive options under the Plan shall be those
employees, officers, directors (including without limitation non-employee
directors) and consultants of the Company and its subsidiaries who, in the
opinion of the Board, are in a position to make a significant contribution to
the success of the Company or such subsidiaries. A subsidiary for purposes of
the Plan shall be a corporation in which the Company owns, directly or
indirectly, stock possessing 50% or more of the total combined voting power of
all classes of stock.
Incentive options shall be granted only to "employees" as defined in the
provisions of the Code or regulations thereunder applicable to incentive
options. Receipt of options under the Plan or of awards under any other employee
benefit plan of the Company or any of its subsidiaries shall not preclude a
person from receiving options or additional options under the Plan.
6. TERMS AND CONDITIONS OF OPTIONS
(a) Limitations. As a condition of exercising an option, the Board may
require the individual exercising the option to be subject to restrictions on
transfer on the shares of Stock acquired by the individual upon exercise of the
option.
(b) Exercise Price. The exercise price of each option shall be determined
by the Board. In the case of incentive options such price shall not be less than
100% (110%, in the case of an incentive option granted to a ten percent
shareholder) of the fair market value per share of the Stock at the time the
option is granted. For this purpose, "fair market value" in the case of
incentive options shall have the same meaning as it does in the provisions of
the Code arid the regulations thereunder applicable to incentive options; and
"ten-percent shareholder" shall mean any employee who at the time of grant owns
directly, or is deemed to own by reason of the attribution rules set forth in
the Code relating to incentive options, stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company or of any of
its parent or subsidiary corporations.
(c) Duration of Options. An option shall be exercisable during such period
or periods as the Board may specify. The latest date on which an option may be
exercised (the "Final Exercise Date") shall be
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the date which is ten years (five years, in the case of an incentive option
granted to a "ten-percent shareholder" as defined in (b) above) from the date
the option was granted or, in the case of nonstatutory options fifteen years
from the date the option was granted, or such earlier date as may be specified
by the Board at the time the option is granted.
(d) Exercise of Options.
(1) The period for exercising an option shall be determined by the
Board in each instance. In the case of an option not
immediately exercisable in full, the Board may at any time
accelerate the time at which all or any part of the option may
be exercised.
(2) The award forms or other instruments evidencing incentive
options shall contain such provisions relating to exercise and
other matters as are required of incentive options under the
applicable provisions of the Code and the regulations
thereunder, as from time to time in effect.
(3) Any exercise of an option shall be in writing, signed by the
proper person and delivered or mailed to the Company,
accompanied by (a) the option certificate and any other
documents required by the Board and (b) payment in full for
the number of shares for which the option is exercised.
(4) In the case of a nonstatutory option, the Board shall have the
right to require that the individual exercising the option
remit to the Company an amount sufficient to satisfy any
federal, state or local withholding tax requirements (or make
other arrangements satisfactory to the Company with regard to
such taxes) prior to the delivery of any Stock pursuant to the
exercise of the option. In the case of an incentive option, if
at the time the option is exercised the Board determines that
under applicable law and regulations the Company could be
liable for the withholding of any federal or state tax with
respect to a disposition of the Stock received upon exercise,
the Board may require as a condition of exercise that the
individual exercising the option agree (i) to inform the
Company promptly of any disposition (within the meaning of the
Code and the regulations thereunder relating to incentive
options and Stock received upon exercise, and (ii) to give
such security as the Board deems adequate to meet the
potential liability of the Company for the withholding of tax,
and to augment such security from time to time in any amount
reasonably deemed necessary by the Board to preserve the
adequacy of such security.
The Board may provide that, if and to the extent withholding
of any federal, state or local tax is required in connection
with the exercise of an option, the option holder may elect,
at such time and in such manner as the Board shall prescribe,
to have the Company hold back from the shares to be delivered
Stock having a value calculated to satisfy such withholding
obligation.
(5) If an option is exercised by the executor or administrator of
a deceased participant, or by the person or persons to whom
the option has been transferred by the participant's will or
the applicable laws of descent and distribution, the Company
shall be under no obligation to deliver Stock pursuant to such
exercise until the Company is satisfied as to the authority of
the person or persons exercising the option.
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(e) Payment for and Delivery of Stock. Full payment for Stock purchased
under the Plan shall be made at the tune of exercise in cash or by check, bank
draft or money order payable to Company or, if so permitted by the Board, (i)
through the delivery of shares of Stock having a fair market value on the last
business day preceding the date of exercise equal to the exercise price or (ii)
by a combination of cash and Stock or (iii) by delivery of a promissory note of
the option holder to the Company, such note to be payable on such terms as are
specified by the Board, or by a combination of cash (or cash and Stock) and the
option holder's promissory note; provided, that if the Stock delivered upon
exercise of the option is an original issue of authorized Stock, at least so
much of the exercise price as represents the par value of such Stock shall be
paid in cash or by a combination of cash and Stock.
An option holder shall not have the rights of a shareholder with regard to
awards under the Plan except as to Stock actually received by him or her under
the Plan.
The Company shall not be obligated to deliver any shares of Stock (i)
until, in the opinion of the Company's counsel, all applicable federal and state
laws and regulations have been complied with, (ii) if the outstanding Stock is
at the time listed on any stock exchange, until the shares to be delivered have
been listed or authorized to be listed on such exchange upon official notice of
issuance, and (iii) until all other legal matters in connection with the
issuance and delivery of such shares have been approved by the Company's
counsel. If the Stock to be issued upon exercise of an option has not been
registered under the Securities Act of 1933, as amended, the Company may
require, as a condition to exercise of the option, such representations or
agreements as counsel for the Company may consider appropriate to avoid
violation of such Act and may require that the certificates evidencing such
Stock bear an appropriate legend restricting transfer.
(f) Nontransferability of Options. No option may be transferred other than
by will or by the laws of descent and distribution and during a participant's
lifetime an option may be exercised only by him or her.
(g) Death. If a participant dies during the period when his or her option
is exercisable, each option held by the participant immediately prior to death
may be exercised, to the extent set forth below, by his or her executor or
administrator, or by the person or persons to whom the option is transferred by
will or the applicable laws of descent and distribution, at any time within
twelve (12) months following his or her death (subject, however, to the
limitations of Section 6(c) regarding the maximum exercise period for such
option). During such period, the option shall be exercisable only to the extent
the option was exercisable at the time of the participant's death.
(h) Termination of Employment For Cause. If a participant's employment or
service with the Company and its subsidiaries is terminated for cause, no option
may be exercised after the participant has ceased to be employed by or to render
services to the Company. For purposes of this Section 6, "cause" is defined as
follows: (i) the participant's conviction for the commission of a felony, (ii)
the participant's excessive absence from work for reasons other than illness,
(iii) the participant's use of alcohol, illegal drugs or any other illegal
substance in such a manner as to interfere with the performance of his or her
duties, (iv) the participant's refusal to follow reasonable directives from his
or her superior, or (v) the participant's failure to perform any material duty
and such failure has continued for thirty days after the participant has been
notified in writing by the Company of the specific nature of his or her failure
to perform. Any determination by the Board that the employment or services to
the Company of any participant were terminated by reason of dismissal without
cause for the purposes of the Plan shall have no effect upon any determination
of the rights or obligations of the Company or a participant for any other
purpose.
(i) Other Termination of Employment. If a participant's employment with
the Company and its subsidiaries terminates for any reason other than
termination for cause or death, all options held by the participant shall be
exercisable by him or her only during the thirty (30) days following termination
of his or her employment but in no event after the Final Exercise Date and only
as to the number of shares, if any, as
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to which it was exercisable immediately prior to termination. For purposes of
this Section 6(i), employment shall not be considered terminated (i) in the case
of sick leave or other bona fide leave of absence approved for purposes of the
Plan by the Board, so long as the participant's right to re-employment is
guaranteed either by statute or by contract, or (ii) in the case of a transfer
of employment between the Company and a subsidiary or between subsidiaries or to
the employment of a corporation (or a parent or subsidiary corporation of such
corporation) issuing or assuming a stock option in a transaction to which
Section 424(a) of the Code applies.
7. MERGER. COMBINATION OR SALE OF ASSETS.
In the event of a merger or consolidation to which the Company is a party
(other than a merger or consolidation in which shareholders of the Company
immediately prior to the merger or consolidation shall immediately following
such merger or consolidation own securities in the resulting corporation having
the right to cast more than 50% of the votes necessary to elect a majority of
the Directors of the resulting corporation), or in the event of a sale or
transfer of all or substantially all of the Company's assets (each a "covered
transaction"), all outstanding options under the Plan shall terminate as of the
effective date of the covered transaction, provided that the Board may, in its
sole discretion:
(a) make each outstanding option exercisable in full prior to the
effective date of the covered transaction, or
(b) cause the surviving or acquiring corporation to replace
outstanding options with options which shall give the grantees the right, upon
any subsequent exercise of such replacement options, to acquire the same kind
and amount of securities and property which such grantees would have acquired if
such grantees had exercised their options under the Plan immediately before the
effective date of the covered transaction and continued as shareholders of the
Company, or
(c) take any other action which the Board shall deem appropriate.
The Board shall give each holder of an outstanding option at least 30 days
prior notice of the effective date of any covered transaction. Any decision made
by the Board under this Section 7 shall be final and binding.
8. EMPLOYMENT RIGHTS
Neither the adoption of the Plan nor the grant of options shall confer
upon any person any right to continued employment with the Company or any parent
or subsidiary or affect in any way the right of the Company or parent or
subsidiary to terminate the employment of a person at any time.
9. EFFECT, DISCONTINUANCE, CANCELLATION, AMENDMENT AND TERMINATION
Neither adoption of the Plan nor the grant of options to a person shall
affect the Company's right to grant to such person options that are not subject
to the Plan, to issue to such person Stock as a bonus or otherwise, or to adopt
other plans or arrangements under which Stock may be issued.
The Board may at any time discontinue granting options under the Plan. The
Board may at any time alter, terminate, discontinue, suspend or amend the Plan.
The Board may not, however, without the requisite shareholder approval,
increase the maximum number of shares subject to the Plan or alter the class of
persons eligible to participate in the Plan, or, without the consent of the
participant, alter or impair any option previously granted to a participant
under the Plan, except as provided in Sections 2 and 7.
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