<PAGE> 1
As filed with the Securities and Exchange Commission on July 25, 1997
Registration No.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
IRIDEX CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 77-0211467
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
340 PIONEER WAY
MOUNTAIN VIEW, CALIFORNIA 94041
-------------------------------
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
AMENDED AND RESTATED 1989 INCENTIVE STOCK PLAN, AS AMENDED
1995 EMPLOYEE STOCK PURCHASE PLAN, AS AMENDED
(Full title of the plans)
Theodore A. Boutacoff
President and Chief Executive Officer
IRIDEX Corporation
340 Pioneer Way
Mountain View, California 94041
(415) 962-8100
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copy to:
JUDITH M. O'BRIEN, ESQ.
WILSON, SONSINI, GOODRICH & ROSATI
Professional Corporation
650 Page Mill Road
Palo Alto, California 94304-1050
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==========================================================================================================================
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of Securities to be Price Offering Registration
to be Registered Registered (1) Per Share Price Fee(2)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par value 550,000 9.75 $5,362,500 $1,625
</TABLE>
(1) Pursuant to Rule 428 under the Securities Act of 1933, as amended
("Act"), the prospectus contained herein with respect to the Amended
and Restated 1989 Incentive Stock Plan, as amended, and the 1995
Employee Stock Purchase Plan, as amended also relates to shares
registered under the Form S-8 Registration Statement No. 333-4264
(2) Estimated in accordance with Rule 457(c) and (h) under the Act solely
for the purpose of calculating the registration fee, based on the
average of the high and low price of the Registrant's Common Stock as
reported by Nasdaq NMS on July 22, 1997.
<PAGE> 3
IRIDEX CORPORATION
REGISTRATION STATEMENT ON FORM S-8
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
There are hereby incorporated by reference into this Registration
Statement the following documents and information heretofore filed with the
Securities and Exchange Commission (the "Commission") by IRIDEX Corporation
(the "Company" or the "Registrant"):
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996 filed pursuant to Section
13(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"); and
(b) Registrant's Quarterly Report on Form 10-QSB for the
fiscal quarter ended March 31, 1997, filed pursuant to
Section 13(a) of the Exchange Act.
All documents filed by Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date hereof, and prior to the
filing of a post-effective amendment which indicates that all securities
offered hereunder have been sold or which de-registers all securities then
remaining unsold under this registration statement, shall be deemed to be
incorporated by reference herein and to be part hereof from the date of filing
of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the issuance of shares of Common Stock offered
hereby will be passed upon for the Registrant by Wilson, Sonsini, Goodrich &
Rosati, P.C. ("WSGR"), Palo Alto, California. Judith Mayer O'Brien, a member
of WSGR, is Secretary of the Registrant.
<PAGE> 4
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporations Law authorizes a
court to award, or a corporation's Board of Directors to grant, indemnification
to directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the Act. The Registrant's
Bylaws provides for the mandatory indemnification of its directors and officers
and permissible indemnification of employees and other agents to the maximum
extent permitted by Delaware General Corporation Law. Registrant has entered
into an indemnification agreement with each of its officers and directors which
provide the Registrant's officers and directors with indemnification to the
maximum extent permitted by the Delaware General Corporation Law. In addition,
the Registrant's Amended and Restated Certificate of Incorporation provides
that, pursuant to Delaware law, its directors shall not be liable for monetary
damages for a breach of the directors' fiduciary duty as a director to
Registrant and its stockholders, provided that such liability does not arise
from certain proscribed conduct. Registrant also currently maintains officer
and director liability insurance.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit
Number Description of Document
- --------- ------------------------------------------------------------
5.1 Opinion of Counsel as to legality of securities being registered.
10.1 Amended and Restated 1989 Incentive Stock Plan, as amended and
forms of option agreements and stock purchase agreement
thereunder.
10.2 1995 Employee Stock Purchase Plan, as amended and form of
subscription agreement thereunder.
23.1 Consent of Coopers & Lybrand L.L.P., Independent Accountants.
23.2 Consent of Counsel (contained in Exhibit 5.1).
24.1 Power of Attorney (see page 5).
2
<PAGE> 5
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(a)
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the Registrant's Certificate of
Incorporation, Bylaws, indemnification agreements or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
3
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Mountain View, State of California, on this
25th day of July, 1997.
IRIDEX CORPORATION
By: /s/ THEODORE A. BOUTACOFF
Theodore A. Boutacoff
President and Chief Executive Officer
4
<PAGE> 7
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Theodore A. Boutacoff and
James L. Donovan jointly and severally, his or her attorneys-in-fact, each with
the power of substitution, for him in any and all capacities, to sign any
amendments to this Registration Statement on Form S-8 and to file the same,
with exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
each of said attorney-in-fact, or his or her substitute or substitutes, may do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title Date
- ------------------------------- ------------------------------------- -------------
<S> <C> <C>
President, Chief Executive Officer and July 25, 1997
/s/ Theodore A. Boutacoff Director (Principal Executive Officer)
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Theodore A. Boutacoff
/s/ James L. Donovan Chief Financial Officer July 25, 1997
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James L. Donovan
/s/ John M. Nehra Chariman of the Board of Directors July 25, 1997
- -------------------------------
John M. Nehra
Director July 25, 1997
/s/ William Boeger, III
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William Boeger, III
Director July 25, 1997
/s/ Milton Chang
- -------------------------------
Milton Chang
Director July 25, 1997
/s/ Donald L. Hammond
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Donald L. Hammond
</TABLE>
5
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Page
Number No.
<S> <C> <C>
5.1 Opinion of Counsel as to legality of securities being
registered.
10.1 Amended and Restated 1989 Incentive Stock Plan, as amended and
forms of option agreements and restricted stock purchase
agreement thereunder.
10.2 1995 Employee Stock Purchase Plan, as amended and form of
subscription agreement thereunder.
23.1 Consent of Coopers & Lybrand L.L.P., Independent Accountants.
23.2 Consent of Counsel (contained in Exhibit 5.1).
24.1 Power of Attorney (see page 5).
</TABLE>
<PAGE> 1
EXHIBIT 5.1
July 25, 1997
IRIDEX Corporation
340 Pioneer Way
Mountain View, California 94041
RE: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by
you with the Securities and Exchange Commission on or about July 25, 1997 (the
"Registration Statement") in connection with the registration under the
Securities Act of 1933, as amended, of a total of 500,000 shares of your Common
Stock reserved for issuance under the Amended and Restated 1989 Incentive Stock
Plan, as amended, and 50,000 shares of your Common Stock reserved for issuance
under the 1995 Employee Stock Purchase Plan, as amended (collectively, the
"Shares") (collectively, the "Plans"). As legal counsel for IRIDEX
Corporation, we have examined the proceedings taken and are familiar with the
proceedings proposed to be taken by you in connection with the sale and
issuance of the Shares under the Plans.
It is our opinion that, when issued and sold in the manner referred to
in the Plans and pursuant to the respective agreement which accompanies each
grant under the Plans, the Shares will be legally and validly issued, fully
paid and nonassessable.
We consent to the use of this opinion as an exhibit to the
Registration Statement and further consent to the use of our name wherever it
appears in the Registration Statement and any amendments to it.
Very truly yours,
WILSON, SONSINI, GOODRICH & ROSATI
Professional Corporation
<PAGE> 1
EXHIBIT 10.1
IRIDEX CORPORATION
AMENDED AND RESTATED 1989 INCENTIVE STOCK PLAN
(Amended April 28, 1997)
1. Purposes of the Plan. The purposes of this Incentive Stock
Plan are to attract and retain the best available personnel, to provide
additional incentive to the Employees of IRIDEX Corporation (the "Company") and
to promote the success of the Company's business.
Options granted hereunder may be either Incentive Stock
Options or Nonstatutory Stock Options, at the discretion of the Administrator
and as reflected in the terms of the written option agreement. The
Administrator also has the discretion to grant Stock Purchase Rights.
2. Definitions. As used herein, the following definitions shall
apply:
(a) "Administrator" shall mean the Board or any of its
Committees as shall be administering the Plan, in accordance with Section 4 of
the Plan.
(b) "Applicable Laws" shall mean the legal requirements
relating to the administration of stock option plans under state corporate and
securities laws and the Code.
(c) "Board" shall mean the Board of Directors of the
Company.
(d) "Code" shall mean the Internal Revenue Code of 1986,
as amended.
(e) "Committee" shall mean a committee appointed by the
Board of Directors in accordance with Section 4 of the Plan.
(f) "Company" shall mean IRIDEX Corporation, a Delaware
corporation.
(g) "Consultant" shall mean any person who is engaged by
the Company or any subsidiary to render consulting services and is compensated
for such consulting services, and any person designated as a Key Medical
Advisor by the Company. The term Consultant shall not include Directors who
are not compensated for their services or are paid only a Director's fee by the
Company.
(h) "Continuous Status as an Employee" shall mean the
absence of any interruption or termination of service as an Employee or a
Consultant. Continuous Status as an Employee shall not be considered
interrupted in the case of sick leave, military leave, or any other leave of
absence approved by the Administrator; provided that such leave is for a period
of not more than 90 days or reemployment upon the expiration of such leave is
guaranteed by contract or statute.
<PAGE> 2
(i) "Director" shall mean a member of the Board.
(j) "Employee" shall mean any person, including Officers
and Directors, employed by the Company or any Parent or Subsidiary of the
Company. The payment of a Director's fee by the Company shall not be
sufficient to constitute "employment" by the Company.
(k) "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
(l) "Incentive Stock Option" shall mean an Option
intended to qualify as an incentive stock option within the meaning of Section
422 of the Code.
(m) "Nonstatutory Stock Option" shall mean an Option not
intended to qualify as an Incentive Stock Option.
(n) "Officer" shall mean a person who is an officer of
the Company within the meaning of Section 16 of the Exchange Act and the rules
and regulations promulgated thereunder.
(o) "Option" shall mean a stock option granted pursuant
to the Plan.
(p) "Optioned Stock" shall mean the Stock subject to an
Option.
(q) "Optionee" shall mean an Employee or Consultant who
receives an Option.
(r) "Parent" shall mean a "parent corporation," whether
now or hereafter existing, as defined in Section 424(e) of the Code.
(s) "Plan" shall mean this Amended and Restated 1989
Incentive Stock Plan.
(t) "Purchaser" shall mean an Employee or Consultant who
exercises a Stock Purchase Right.
(u) "Rule 16b-3 shall mean Rule 16b-3 of the Exchange Act
or any successor to Rule 16b-3, as in effect when discretion is exercised with
respect to the Plan.
(v) "Share" shall mean a share of the Stock, as adjusted
in accordance with Section 12 of the Plan.
(w) "Stock" shall mean the Common Stock of the Company.
(x) "Stock Purchase Right" shall mean a right to purchase
Stock pursuant to the Plan or the right to receive a bonus of Stock for past
services.
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(y) "Subsidiary" shall mean a "subsidiary corporation,"
whether now or hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of
Section 12 of the Plan, the maximum aggregate number of shares under the Plan
is 1,500,000 shares of Stock. The Shares may be authorized, but unissued, or
reacquired Stock.
If an Option or Stock Purchase Right expires or becomes
unexercisable without having been exercised in full, the unpurchased Shares
which were subject thereto shall become available for future grant or sale
under the Plan (unless the Plan has terminated); provided, however, that Shares
that have actually been issued under the Plan, whether upon exercise of an
Option or Right, shall not be returned to the Plan and shall not become
available for future distribution under the Plan, except that if Shares are
repurchased by the Company at their original purchase price, and the original
purchaser of such Shares did not receive any benefit of ownership of such
Shares, such Shares shall become available for future grant under the Plan.
For purposes of the preceding sentence, voting rights shall not be considered a
benefit of Share ownership.
4. Administration of the Plan.
(a) Procedure.
(i) Multiple Administrative Bodies. If permitted
by Rule 16b-3, the Plan may be administered by different bodies with respect to
Directors, Officers who are not Directors, and Employees who are neither
Directors nor Officers.
(ii) Administration With Respect to Directors and
Officers Subject to Section 16(b). With respect to Option or Stock Purchase
Right grants made to Employees who are also Officers or Directors subject to
Section 16(b) of the Exchange Act, the Plan shall be administered by (A) the
Board, if the Board may administer the Plan in a manner complying with the
rules under Rule 16b-3 relating to the disinterested administration of employee
benefit plans under which Section 16(b) exempt discretionary grants and awards
of equity securities are to be made, or (B) a Committee designated by the Board
to administer the Plan, which Committee shall be constituted to comply with the
rules under Rule 16b-3 relating to the disinterested administration of employee
benefit plans under which Section 16(b) exempt discretionary grants and awards
of equity securities are to be made. Once appointed, such Committee shall
continue to serve in its designated capacity until otherwise directed by the
Board. From time to time the Board may increase the size of the Committee and
appoint additional members, remove members (with or without cause) and
substitute new members, fill vacancies (however caused), and remove all members
of the Committee and thereafter directly administer the Plan, all to the extent
permitted by the rules under Rule 16b-3 relating to the disinterested
administration of employee benefit plans under which Section 16(b) exempt
discretionary grants and awards of equity securities are to be made.
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<PAGE> 4
(iii) Administration With Respect to Other Persons.
With respect to Option or Stock Purchase Right grants made to Employees or
Consultants who are neither Directors nor Officers of the Company, the Plan
shall be administered by (A) the Board or (B) a Committee designated by the
Board, which Committee shall be constituted to satisfy Applicable Laws. Once
appointed, such Committee shall serve in its designated capacity until
otherwise directed by the Board. The Board may increase the size of the
Committee and appoint additional members, remove members (with or without
cause) and substitute new members, fill vacancies (however caused), and remove
all members of the Committee and thereafter directly administer the Plan, all
to the extent permitted by Applicable Laws.
(b) Powers of the Administrator. Subject to the
provisions of the Plan, the Administrator shall have the authority, in its
discretion: (i) to grant Incentive Stock Options, Nonstatutory Stock Options or
Stock Purchase Rights; (ii) to determine, upon review of relevant information
and in accordance with Section 8 of the Plan, the fair market value of the
Stock; (iii) to determine the exercise price per share of Options, or Stock
Purchase Rights, to be granted, which exercise price shall be determined in
accordance with Section 8 of the Plan; (iv) to determine the Employees and
Consultants to whom, and the time or times at which, Options or Stock Purchase
Rights shall be granted and the number of shares to be represented by each
Option or Stock Purchase Right; (v) to interpret the Plan; (vi) to prescribe,
amend and rescind rules and regulations relating to the Plan; (vii) to
determine the terms and provisions of each Option or Stock Purchase Right
granted (which need not be identical) and, with the consent of the holder
thereof, modify or amend each Option or Stock Purchase Right; (viii) to
accelerate or defer (with the consent of the Optionee) the exercise date of any
Option, consistent with the provisions of Section 6 of the Plan; (ix) to
authorize any person to execute on behalf of the Company any instrument
required to effectuate the grant of an Option or Stock Purchase Right
previously granted by the Administrator; and (x) to make all other
determinations deemed necessary or advisable for the administration of the
Plan.
(c) Effect of Administrator's Decision. All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees, Purchasers and any other holders of any Options or
Stock Purchase Rights granted under the Plan.
5. Eligibility. Options and Stock Purchase Rights may be granted
to Employees and Consultants, provided that Incentive Stock Options may only be
granted to Employees. An Employee or Consultant who has been granted an Option
or Stock Purchase Right may, if he or she is otherwise eligible, be granted
additional Option(s) or Stock Purchase Right(s).
6. Limitations.
(a) Each Option shall be designated in the written option
agreement as either an Incentive Stock Option or a Nonstatutory Stock Option.
However, notwithstanding such designation, to the extent that the aggregate
fair market value of the Shares with respect to which Incentive Stock Options
are exercisable for the first time by the Optionee during any calendar year
(under all plans of the Company and any Parent or Subsidiary) exceeds $100,000,
such Options shall be treated as Nonstatutory Stock Options. For purposes of
this Section 6(a), Incentive Stock Options shall be taken
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<PAGE> 5
into account in the order in which they were granted. The fair market value of
the Shares shall be determined as of the time the Option with respect to such
Shares is granted.
(b) Neither the Plan nor any Option or Stock Purchase
Right shall confer upon an Optionee any right with respect to continuing the
Optionee's employment or consulting relationship with the Company, nor shall it
interfere in any way with the Optionee's right or the Company's right to
terminate such employment or consulting relationship at any time, with or
without cause.
(c) The following limitations shall apply to grants of
Options and Stock Purchase Rights to Employees:
(i) No Employee shall be granted, in any fiscal
year of the Company, Options and Stock Purchase Rights to purchase more than
500,000 Shares.
(ii) In connection with his or her initial
employment, an Employee may be granted Options and Stock Purchase Rights to
purchase up to an additional 500,000 Shares which shall not count against the
limit set forth in subsection (i) above.
(iii) The foregoing limitations shall be adjusted
proportionately in connection with any change in the Company's capitalization
as described in Section 12.
(iv) If an Option or Stock Purchase Right is
cancelled in the same fiscal year of the Company in which it was granted (other
than in connection with a transaction described in Section 12), the cancelled
Option or Stock Purchase Right will be counted against the limits set forth in
subsections (i) and (ii) above. For this purpose, if the exercise price of an
Option or Stock Purchase Right is reduced, the transaction will be treated as a
cancellation of the Option or Stock Purchase Right and the grant of a new
Option or Stock Purchase Right.
7. Term of Plan. The Plan shall become effective upon the
earlier to occur of its adoption by the Board of Directors or its approval by
vote of the holders of a majority of the outstanding shares of the Company
entitled to vote on the adoption of the Plan. It shall continue in effect for a
term of ten (10) years unless sooner terminated under Section 14 of the Plan.
8. Exercise Price of and Consideration for Shares.
(a) Exercise Price. The per share exercise price for the
Shares to be issued pursuant to exercise of an Option shall be determined by
the Administrator, subject to the following:
(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the
time the Incentive Stock Option is granted, owns stock representing more than
ten percent (10%) of the voting power of all
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<PAGE> 6
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.
(B) granted to any Employee other than
an Employee described in paragraph (A) immediately above, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.
(ii) In the case of a Nonstatutory Stock Option,
the per Share exercise price shall be determined by the Administrator.
(b) The fair market value shall be determined by the
Administrator in its discretion; provided, however, that where there is a
public market for the Common Stock, the fair market value per Share shall be
the mean of the bid and asked prices of the Common Stock as of the close of
business on the last trading day before the date of grant, as reported in The
Wall Street Journal (or, if not so reported, as otherwise reported by the
National Association of Securities Dealers Automated Quotation (Nasdaq) System)
or, in the event the Common Stock is listed on a stock exchange, the fair
market value per Share shall be the closing price on such exchange as reported
in The Wall Street Journal as of the close of business on the last trading day
before the date of grant of the Option.
(c) The consideration to be paid for the Shares to be
issued upon exercise of an Option or Stock Purchase Right, including the method
of payment, shall be determined by the Administrator and may consist entirely
of cash, check, promissory note, or other Shares of Stock of the Company 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 Applicable
Law. In making its determination as to the type of consideration to accept,
the Administrator shall consider if acceptance of such consideration may be
reasonably expected to benefit the Company.
9. Options.
(a) Term of Option. The term of each Option shall be
stated in the option agreement; provided, however, that in the case of an
Incentive Stock Option, the term shall be ten (10) years from the date of grant
or such shorter term as may be provided in the option agreement. Moreover, in
the case of an Incentive Stock Option granted to an Optionee who, at the time
the Incentive Stock Option is granted, 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 term of the Incentive Stock Option shall be five (5)
years from the date of grant or such shorter term as may be provided in the
option agreement.
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<PAGE> 7
(b) Exercise of Option.
(i) Procedure for Exercise; Rights as a
Stockholder. Any Option granted hereunder shall be exercisable at such times
and under such conditions as determined by the Administrator, including
performance criteria with respect to the Company and/or the Optionee, and as
shall be permissible under the terms of the Plan.
An Option may not be exercised for a fraction of a
Share.
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 may, as authorized by the
Administrator, consist of any consideration and method of payment allowable
under Section 8 of the Plan. The Company shall issue a stock certificate
evidencing such Shares as soon as practicable. Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Shares, notwithstanding the
exercise of the Option. No adjustment will be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 12 of the Plan.
Exercise of an Option in any manner shall result in a
decrease in the number of Shares which thereafter may be available, both for
purposes of the Plan and for sale under the Option, by the number of Shares as
to which the Option is exercised.
(ii) Termination of Status as an Employee or
Consultant. Unless otherwise set forth in the option agreement, if an Optionee
ceases to serve as an Employee or Consultant (including termination by reason
of the Optionee's retirement), the Optionee may, but only within thirty days
after the date the Optionee ceases to be an Employee or Consultant of the
Company, exercise an Option to the extent that the Optionee was entitled to
exercise it at the date of such termination. To the extent that the Optionee
was not entitled to exercise the Option at the date of such termination, or if
the Optionee does not exercise such Option (which the Optionee was entitled to
exercise) within the time specified herein, the Option shall terminate.
(iii) Notwithstanding the provisions of Section
9(b)(ii) above, in the event of termination of an Optionee's Continuous Status
as an Employee or Consultant as a result of his or her total and permanent
disability, as defined in Section 22(e)(3) of the Code, the Optionee may, but
only within twelve (12) months from the date of such termination (and in no
event later than the expiration date of the term of such Option as set forth in
the Option Agreement), exercise the Option to the extent otherwise entitled to
exercise it at the date of such termination. To the extent that the Optionee
was not entitled to exercise the Option at the date of termination, or if the
Optionee does not exercise such Option to the extent so entitled within the
time specified herein, the Option shall terminate, and the Shares covered by
such Option shall revert to the Plan.
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<PAGE> 8
(iv) Death of Optionee. In the event of the death
of Optionee, the Option may be exercised at any time within one (1) year
following the date of death (or such other period of time as is determined by
the Administrator, but in no event later than the term of such Option as set
forth in the Option Agreement) by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only
to the extent of the right to exercise that would have accrued at the date of
termination.
(v) Rule 16b-3. Options granted to individuals
subject to Section 16 of the Exchange Act ("Insiders") must comply with the
applicable provisions of Rule 16b-3 and shall contain such additional
conditions or restrictions as may be required thereunder to qualify for the
maximum exemption from Section 16 of the Exchange Act with respect to Plan
transactions.
10. Stock Purchase Rights.
(a) Rights to Purchase. After the Administrator
determines that it will offer an Employee or Consultant a Stock Purchase Right,
it shall advise the offeree of the terms, conditions and restrictions relating
to the offer, including the number of Shares which such person shall be
entitled to purchase, and the time within which such person must accept such
offer, which shall in no event exceed nine (9) months from the date upon which
the Administrator made the determination to grant the Stock Purchase Right.
The offer shall be accepted by execution of a Stock Purchase Agreement in the
form determined by the Administrator.
(b) Issuance of Shares. Forthwith after payment
therefor, the Shares purchased shall be duly issued; provided, however, that
the Administrator may require that the Purchaser make adequate provision for
any federal and state withholding obligations of the Company as a condition to
the Purchaser purchasing such Shares.
(c) Repurchase Option. Unless the Administrator
determines otherwise, the Stock Purchase Agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
the Purchaser's employment with the Company for any reason (including death or
disability). If the Administrator so determines, the purchase price for shares
repurchased may be paid by cancellation of any indebtedness of the Purchaser to
the Company.
(d) Rule 16b-3. Stock Purchase Rights granted to
Insiders, and Shares purchased by Insiders in connection with Stock Purchase
Rights, shall be subject to any restrictions applicable thereto in compliance
with Rule 16b-3. An Insider may only purchase Shares pursuant to the grant of
a Stock Purchase Right, and may only sell Shares purchased pursuant to the
grant of a Stock Purchase Right, during such time or times as are permitted by
Rule 16b-3.
(e) Other Provisions. The Stock Purchase Agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator.
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11. Non-Transferability of Options and Stock Purchase Rights.
Options and Stock Purchase Rights may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in any manner other than by will or
by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee or Purchaser, only by the Optionee or Purchaser.
12. Adjustments Upon Changes in Capitalization, Dissolution,
Merger or Asset Sale.
(a) Changes in Capitalization. Subject to any required
action by the stockholders of the Company, the number of shares of Common Stock
covered by each outstanding Option and Stock Purchase Right, and the number of
shares of Common Stock which have been authorized for issuance under the Plan
but as to which no Options or Stock Purchase Rights have yet been granted or
which have been returned to the Plan upon cancellation or expiration of an
Option or Stock Purchase Right, as well as the price per share of Common Stock
covered by each such outstanding Option or Stock Purchase Right, shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company; provided, however, that
conversion of any convertible securities of the Company shall not be deemed to
have been "effected without receipt of consideration." Such adjustment shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by
the Company of shares of stock of any class, or securities convertible into
shares of stock of any class, shall affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of Common Stock
subject to an Option or Stock Purchase Right.
(b) Dissolution or Liquidation. In the event of the
proposed dissolution or liquidation of the Company, to the extent that an
Option or Stock Purchase Right has not been previously exercised, it will
terminate immediately prior to the consummation of such proposed action. The
Board may, in the exercise of its sole discretion in such instances, declare
that any Option or Stock Purchase Right shall terminate as of a date fixed by
the Board and give each Optionee the right to exercise his or her Option or
Stock Purchase Right as to all or any part of the Optioned Stock, including
Shares as to which the Option or Stock Purchase Right would not otherwise be
exercisable.
(c) Merger or Asset Sale. In the event of a merger of
the Company with or into another corporation, or the sale of substantially all
of the assets of the Company, each outstanding Option and Stock Purchase Right
shall be assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. In the
event that the successor corporation refuses to assume or substitute for the
Option or Stock Purchase Right, then with respect to Options or Stock Purchase
Rights issued prior to December 12, 1995 (the date on which the Company
obtained a permit from the California Department of Corporations for the
issuance of options and stock under this Plan) and Options granted on or after
the effective date of the Company's initial public offering, the Optionee shall
have the right to exercise the Option or Stock Purchase Right as to all of the
Optioned Stock, including Shares as to which it would not otherwise be
exercisable, and with respect to Options and Stock Purchase Rights issued
subsequent to December 12, 1995 and prior to the
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<PAGE> 10
effective date of the Company's initial public offering, the Option or Stock
Purchase Right shall terminate as of the date of the closing of the merger to
the extent that such Option or Stock Purchase Right was not exercisable. If an
Option or Stock Purchase Right is exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Administrator
shall notify the Optionee that the Option or Stock Purchase Right shall be
fully exercisable for a period of fifteen (15) days from the date of such
notice, and the Option or Stock Purchase Right shall terminate upon the
expiration of such period. For the purposes of this paragraph, the Option or
Stock Purchase Right shall be considered assumed if, following the merger or
sale of assets, the option or right confers the right to purchase or receive,
for each Share of Optioned Stock subject to the Option or Stock Purchase Right
immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) received in the merger or sale of
assets by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger
or sale of assets was not solely common stock of the successor corporation or
its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the exercise of
the Option or Stock Purchase Right, for each Share of Optioned Stock subject to
the Option or Stock Purchase Right, to be solely common stock of the successor
corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.
13. Time of Granting Options. The date of grant of an Option or
Stock Purchase Right shall, for all purposes, be the date on which the
Administrator makes the determination granting such Option or Stock Purchase
Right. Notice of the determination shall be given to each Employee or
Consultant to whom an Option or Stock Purchase Right is so granted within a
reasonable time after the date of such grant.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time
amend, alter, suspend or terminate the Plan.
(b) Stockholder Approval. The Company shall obtain
stockholder approval of any Plan amendment to the extent necessary and
desirable to comply with Rule 16b-3 or with Section 422 of the Code (or any
successor rule or statute or other applicable law, rule or regulation,
including the requirements of any exchange or quotation system on which the
Common Stock is listed or quoted). Such stockholder approval, if required,
shall be obtained in such a manner and to such a degree as is required by the
applicable law, rule or regulation.
(c) Effect of Amendment or Termination. No amendment,
alteration, suspension or termination of the Plan shall impair the rights of
any Optionee, unless mutually agreed otherwise between the Optionee and the
Administrator, which agreement must be in writing and signed by the Optionee
and the Company.
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15. Conditions Upon Issuance of Shares. Shares shall not be
issued pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right and the issuance and delivery
of Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act, the rules and regulations promulgated thereunder, the
requirements of any stock exchange upon which the Shares may then be listed,
and other Applicable Law, and shall be further subject to the approval of
counsel for the Company with respect to such compliance.
As a condition to the exercise of an Option or Stock Purchase
Right, the Company may require the person exercising such Option or Stock
Purchase Right 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 Company, during the term of this
Plan, shall at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.
The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority shall not
have been obtained.
17. Option and Stock Purchase Agreements. Options shall be
evidenced by written option agreements in such form as the Administrator shall
approve. Upon the exercise of Stock Purchase Rights, the Purchaser shall sign
a Stock Purchase Agreement in such form as the Administrator shall approve.
18. Stockholder Approval. Continuance of the Plan shall be
subject to approval by the affirmative vote of the holders of a majority of the
outstanding shares of the Company present or represented and entitled to vote
thereon. The approval of such stockholders of the Company shall be solicited
substantially in accordance with Section 14(a) of the Exchange Act and the
rules and regulations promulgated thereunder, to the extent the Company is
subject to Section 14(a) of the Exchange Act.
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<PAGE> 1
EXHIBIT 10.2
IRIDEX CORPORATION
1995 EMPLOYEE STOCK PURCHASE PLAN
(As amended April 28, 1997)
The following constitute the provisions of the 1995 Employee Stock
Purchase Plan of Iridex Corporation (the "Company")
1. Purpose. The purpose of the Plan is to provide employees of
the Company and its Designated Subsidiaries with an opportunity to purchase
Common Stock of the Company through accumulated payroll deductions. It is the
intention of the Company to have the Plan qualify as an "Employee Stock
Purchase Plan" under Section 423 of the Internal Revenue Code of 1986, as
amended. The provisions of the Plan, accordingly, shall be construed so as to
extend and limit participation in a manner consistent with the requirements of
that section of the Code.
2. Definitions.
(a) "Board" shall mean the Board of Directors of the
company.
(b) "Code" shall mean the Internal Revenue Code of 1986,
as amended.
(c) "Common Stock" shall mean the common stock of the
Company.
(d) "Company" shall mean Iridex Corporation, a Delaware
corporation, and any Designated Subsidiary of the Company.
(e) "Compensation" shall mean all base straight time
gross earnings and sales commissions, payments for overtime, shift premium,
incentive compensation, incentive payments, bonuses, but exclusive of other
compensation.
(f) "Designated Subsidiaries" shall mean the Subsidiaries
which have been designated by the Board from time to time in its sole
discretion as eligible to participate in the Plan.
(g) "Employee" shall mean any individual who is an
Employee of the Company for tax purposes whose customary employment with the
Company is at least twenty (20) hours per week and more than five (5) months in
any calendar year. For purposes of the Plan, the employment relationship shall
be treated as continuing intact while the individual is on sick leave or other
leave of absence approved by the Company. Where the period of leave exceeds 90
days and the individual's right to reemployment is not guaranteed either by
statute or by contract, the employment relationship will be deemed to have
terminated on the 91st day of such leave.
(h) "Enrollment Date" shall mean the first day of each
Offering Period.
(i) "Exercise Date" shall mean the last day of each
Offering Period.
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<PAGE> 2
(j) "Fair Market Value" shall mean, as of any date, the
value of Common Stock determined as follows:
(1) If the Common Stock is listed on any
established stock exchange or a national market system, including without
limitation the Nasdaq National Market of the National Association of Securities
Dealers, Inc. Automated Quotation ("Nasdaq") Stock Market, its Fair Market
Value shall be the closing sale price for the Common Stock (or the mean of the
closing bid and asked prices, if no sales were reported), as quoted on such
exchange (or the exchange with the greatest volume of trading in Common Stock)
or system on the date of such determination, as reported in The Wall Street
Journal or such other source as the Board deems reliable, or;
(2) If the Common Stock is quoted on the Nasdaq
System (but not on the Nasdaq National Market thereof) or is regularly quoted
by a recognized securities dealer but selling prices are not reported, its Fair
Market Value shall be the mean of the closing bid and asked prices for the
Common Stock on the date of such determination, as reported in The Wall Street
Journal or such other source as the Board deems reliable, or;
(3) In the absence of an established market for
the Common Stock, the Fair Market Value thereof shall be determined in good
faith by the Board.
(4) For purposes of the Enrollment Date of the
first Offering Period under the Plan, the Fair Market Value shall be the
initial price to the public as set forth in the final Prospectus included
within the Registration Statement filed with the Securities and Exchange
Commission for the initial public offering of the Company's Common Stock.
(k) "Offering Period" shall mean a period of
approximately six (6) months, commencing on an Enrollment Date and terminating
on an Exercise Date. The first Offering Period shall commence on the effective
date of the Company's initial public offering of its Common Stock that is
registered with the Securities and Exchange Commission (the "Effective Date")
and shall terminate on the last Trading Day of the month which is six months
from the Effective Date. Thereafter, Offering Periods shall commence on the
first Trading Day following termination of the prior Offering Period and shall
terminate on the last Trading Day of the sixth month following commencement of
such Offering Period.
(l) "Plan" shall mean this 1995 Employee Stock Purchase
Plan.
(m) "Purchase Price" shall mean an amount equal to 85% of
the Fair Market Value of a share of Common Stock on the Enrollment Date or on
the Exercise Date, whichever is lower.
(n) "Reserves" shall mean the number of shares of Common
Stock covered by each option under the Plan which have not yet been exercised
and the number of shares of Common Stock which have been authorized for
issuance under the Plan but not yet placed under option.
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<PAGE> 3
(o) "Subsidiary" shall mean a corporation, domestic or
foreign, of which not less than 50% of the voting shares are held by the
Company or a Subsidiary, whether or not such corporation now exists or is
hereafter organized or acquired by the Company or a Subsidiary.
(p) "Trading Day" shall mean a day on which national
stock exchanges and the NASDAQ System are open for trading.
3. Eligibility.
(a) Any Employee (as defined in Section 2(g)), who shall
be employed by the Company on a given Enrollment Date shall be eligible to
participate in the Plan.
(b) Any provisions of the Plan to the contrary
notwithstanding, no Employee shall be granted an option under the Plan (i) to
the extent, immediately after the grant, such Employee (or any other person
whose stock would be attributed to such Employee pursuant to Section 424(d) of
the Code) would own capital stock of the Company and/or hold outstanding
options to purchase such stock possessing five percent (5%) or more of the
total combined voting power or value of all classes of the capital stock of the
Company or of any Subsidiary, or (ii) to the extent his or her rights to
purchase stock under all employee stock purchase plans of the Company and its
subsidiaries to accrue at a rate which exceeds Twenty-Five Thousand Dollars
($25,000) worth of stock (determined at the fair market value of the shares at
the time such option is granted) for each calendar year in which such option is
outstanding at any time.
4. Offering Periods. The Plan shall be implemented by
consecutive Offering Periods. The first Offering Period shall commence on the
Effective Date and shall terminate on the last Trading Day of the month that is
six months from the Effective Date. Thereafter, Offering Periods shall
commence on the first Trading Day following Exercise Date of the prior Offering
Period and shall terminate on the last Trading Day of the sixth month following
commencement of such Offering Period. The Board shall have the power to change
the duration of Offering Periods (including the commencement dates thereof)
with respect to future offerings without shareholder approval if such change is
announced at least fifteen (15) days prior to the scheduled beginning of the
first Offering Period to be affected thereafter.
5. Participation.
(a) An eligible Employee may become a participant in the
Plan by completing a subscription agreement authorizing payroll deductions in
the form of Exhibit A to this Plan and filing it with the Company's Personnel
Department office not later than one day prior to the applicable Enrollment
Date.
(b) Payroll deductions for a participant shall commence
on the first payroll following the Enrollment Date and shall end on the last
payroll in the Offering Period to which such authorization is applicable,
unless sooner terminated by the participant as provided in Section 10 hereof.
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<PAGE> 4
6. Payroll Deductions.
(a) At the time a participant files his or her
subscription agreement, he or she shall elect to have payroll deductions made
on each pay day during an Offering Period in an amount not exceeding ten
percent (10%) of the Compensation which he or she receives on each pay day
during the Offering Period.
(b) All payroll deductions made for a participant shall
be credited to his or her account under the Plan and will be withheld in whole
percentages only. A participant may not make any additional payments into such
account.
(c) A participant may discontinue his or her
participation in the Plan as provided in Section 10 hereof, but may not
otherwise increase or decrease the rate of his or her payroll deductions during
the Offering Period. A participant's subscription agreement shall remain in
effect for successive Offering Periods unless terminated as provided in Section
10 hereof.
(d) Notwithstanding the foregoing, to the extent
necessary to comply with Section 423(b)(8) of the Code and Section 3(b) hereof,
a participant's payroll deductions may be decreased to 0% at such time during
any Offering Period which is scheduled to end during the current calendar year
(the "Current Offering Period") that the aggregate of all payroll deductions
which were previously used to purchase stock under the Plan in a prior Offering
Period which ended during that calendar year plus all payroll deductions
accumulated with respect to the Current Offering Period equal $21,250. Payroll
deductions shall recommence at the rate provided in such participant's
subscription agreement at the beginning of the first Offering Period which is
scheduled to end in the following calendar year, unless terminated by the
participant as provided in Section 10 hereof.
(e) At the time the option is exercised, in whole or in
part, or at the time some or all of the Company's Common Stock issued under the
Plan is disposed of, the participant must make adequate provision for the
Company's federal, state, or other tax withholding obligations, if any, which
arise upon the exercise of the option or the disposition of the Common Stock.
At any time, the Company may, but will not be obligated to, withhold from the
participant's compensation the amount necessary for the Company to meet
applicable withholding obligations, including any withholding required to make
available to the Company any tax deductions or benefits attributable to sale or
early disposition of Common Stock by the Employee.
7. Grant of Option. On the Enrollment Date of each Offering
Period, each eligible Employee participating in such Offering Period shall be
granted an option to purchase on the Exercise Date of such Offering Period (at
the applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated
prior to such Exercise Date and retained in the participant's account as of the
Exercise Date by the applicable Purchase Price. In no event shall an Employee
be permitted to purchase on the Exercise Date of any Offering Period a number
of shares greater than, as of the first day of the Offering Period, two times
the Employee's initial payroll deduction amount times the number of
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<PAGE> 5
payroll periods in the Offering Period divided by the per share Fair Market
Value. Moreover, no Employee shall be permitted to purchase more than 1,000
shares in any twelve-month period. All such purchases shall also be subject to
the limitations set forth in Sections 3(b) and 12 hereof. Exercise of the
option shall occur as provided in Section 8 hereof, unless the participant has
withdrawn pursuant to Section 10 hereof, and shall expire on the last day of
the Offering Period.
8. Exercise of Option. Unless a participant withdraws from the
Plan as provided in Section 10 hereof, his or her option for the purchase of
shares shall be exercised automatically on the Exercise Date, and the maximum
number of full shares subject to option shall be purchased for such participant
at the applicable Purchase Price with the accumulated payroll deductions in his
or her account. No fractional shares shall be purchased; any payroll
deductions accumulated in a participant's account which are not sufficient to
purchase a full share shall be carried over in the participant's account into
the next Offering Period. During a participant's lifetime, a participant's
option to purchase shares hereunder is exercisable only by him or her.
9. Delivery. As promptly as practicable after each Exercise Date
on which a purchase of shares occurs, the shares shall be credited to an
account in the participant's name with a brokerage firm selected by the Plan
Committee to hold the shares in it's street name.
10. Withdrawal; Termination of Employment.
(a) A participant may withdraw all but not less than all
the payroll deductions credited to his or her account and not yet used to
exercise his or her option under the Plan at any time up to two weeks prior to
any Exercise Date by giving written notice to the Company in the form of
Exhibit B to this Plan. All of the participant's payroll deductions credited
to his or her account will be paid to such participant promptly after receipt
of notice of withdrawal, such participant's option for the Offering Period will
be automatically terminated, and no further payroll deductions for the purchase
of shares will be made during the Offering Period. If a participant withdraws
from an Offering Period, payroll deductions will not resume at the beginning of
the succeeding Offering Period unless the participant delivers to the Company a
new subscription agreement.
(b) Upon a participant's ceasing to be an Employee (as
defined in Section 2(g) hereof) for any reason, he or she will be deemed to
have elected to withdraw from the Plan and the payroll deductions credited to
such participant's account during the Offering Period but not yet used to
exercise the option will be returned to such participant or, in the case of his
or her death, to the person or persons entitled thereto under Section 14
hereof, and such participant's option will be automatically terminated. The
preceding sentence notwithstanding, a participant who receives payment in lieu
of notice of termination of employment shall be treated as continuing to be an
Employee for the participant's customary number of hours per week of employment
during the period in which the participant is subject to such payment in lieu
of notice.
(c) A participant's withdrawal from an Offering Period
will not have any effect upon his or her eligibility to participate in any
similar plan which may hereafter be adopted by the
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<PAGE> 6
Company or in succeeding Offering Periods which commence after the termination
of the Offering Period from which the participant withdraws.
11. Interest. No interest shall accrue on the payroll deductions
of a participant in the Plan.
12. Stock.
(a) The maximum number of shares of the Company's Common
Stock which shall be made available for sale under the Plan shall be one
hundred thousand (100,000) shares, subject to adjustment upon changes in
capitalization of the Company as provided in Section 18 hereof. If on a given
Exercise Date the number of shares with respect to which options are to be
exercised exceeds the number of shares then available under the Plan, the
Company shall make a pro rata allocation of the shares remaining available for
purchase in as uniform a manner as shall be practicable and as it shall
determine to be equitable.
(b) The participant will have no interest or voting right
in shares covered by his option until such option has been exercised.
(c) Shares to be delivered to a participant under the
Plan will be registered in the name of the participant or in the name of the
participant and his or her spouse.
13. Administration.
(a) Administrative Body. The Plan shall be administered
by the Board or a committee of members of the Board appointed by the Board.
The Board or its committee shall have full and exclusive discretionary
authority to construe, interpret and apply the terms of the Plan, to determine
eligibility and to adjudicate all disputed claims filed under the Plan. Every
finding, decision and determination made by the Board or its committee shall,
to the full extent permitted by law, be final and binding upon all parties.
(b) Rule 16b-3 Limitations. Notwithstanding the
provisions of Subsection (a) of this Section 13, in the event that Rule 16b-3
promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or any successor provision ("Rule 16b-3") provides specific
requirements for the administrators of plans of this type, the Plan shall be
administered only by such a body and in such a manner as shall comply with the
applicable requirements of Rule 16b-3.
14. Designation of Beneficiary.
(a) A participant may file a written designation of a
beneficiary who is to receive any shares and cash, if any, from the
participant's account under the Plan in the event of such participant's death
subsequent to an Exercise Date on which the option is exercised but prior to
delivery to such participant of such shares and cash. In addition, a
participant may file a written designation of a beneficiary who is to receive
any cash from the participant's account under the Plan in the event
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<PAGE> 7
of such participant's death prior to exercise of the option. If a participant
is married and the designated beneficiary is not the spouse, spousal consent
shall be required for such designation to be effective.
(b) Such designation of beneficiary may be changed by the
participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known
to the Company, then to such other person as the Company may designate.
15. Transferability. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option
or to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 14 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.
16. Use of Funds. All payroll deductions received or held by the
Company under the Plan may be used by the Company for any corporate purpose,
and the Company shall not be obligated to segregate such payroll deductions.
17. Reports. Individual accounts will be maintained for each
participant in the Plan. Statements of account will be given to participating
Employees at least annually, which statements will set forth the amounts of
payroll deductions, the Purchase Price, the number of shares purchased and the
remaining cash balance, if any.
18. Adjustments Upon Changes in Capitalization.
(a) Changes in Capitalization. Subject to any required
action by the shareholders of the Company, the Reserves as well as the price
per share of Common Stock covered by each option under the Plan which has not
yet been exercised shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of shares of
Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been "effected without receipt of consideration".
Such adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein,
no issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
of Common Stock subject to an option.
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<PAGE> 8
(b) Dissolution or Liquidation. In the event of the
proposed dissolution or liquidation of the Company, the Offering Period shall
terminate immediately prior to the consummation of such proposed action, unless
otherwise provided by the Board.
(c) Merger or Asset Sale. In the event of a proposed
sale of all or substantially all of the assets of the Company, or the merger of
the Company with or into another corporation, each option under the Plan shall
be assumed or an equivalent option shall be substituted by such successor
corporation or a parent or subsidiary of such successor corporation, unless the
Board determines, in the exercise of its sole discretion and in lieu of such
assumption or substitution, to shorten the Offering Period then in progress by
setting a new Exercise Date (the "New Exercise Date") or to cancel each
outstanding right to purchase and refund all sums collected from participants
during the Offering Period then in progress. If the Board shortens the
Offering Period then in progress in lieu of assumption or substitution in the
event of a merger or sale of assets, the Board shall notify each participant in
writing, at least ten (10) business days prior to the New Exercise Date, that
the Exercise Date for his option has been changed to the New Exercise Date and
that his option will be exercised automatically on the New Exercise Date,
unless prior to such date he has withdrawn from the Offering Period as provided
in Section 10 hereof. For purposes of this paragraph, an option granted under
the Plan shall be deemed to be assumed if, following the sale of assets or
merger, the option confers the right to purchase or receive, for each share of
option stock subject to the option immediately prior to the sale of assets or
merger, the consideration (whether stock, cash or other securities or property)
received in the sale of assets or merger by holders of Common Stock for each
share of Common Stock held on the effective date of the transaction (and if
such holders were offered a choice of consideration, the type of consideration
chosen by the holders of a majority of the outstanding shares of Common Stock);
provided, however, that if such consideration received in the sale of assets or
merger was not solely common stock of the successor corporation or its parent
(as defined in Section 424(e) of the Code), the Board may, with the consent of
the successor corporation, provide for the consideration to be received upon
exercise of the option to be solely common stock of the successor corporation
or its parent equal in fair market value to the per share consideration
received by holders of Common Stock and the sale of assets or merger.
The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the
price per share of Common Stock covered by each outstanding option, in the
event the Company effects one or more reorganizations, recapitalizations,
rights offerings or other increases or reductions of shares of its outstanding
Common Stock, and in the event of the Company being consolidated with or merged
into any other corporation.
19. Amendment or Termination.
(a) The Board of Directors of the Company may at any time
and for any reason amend or terminate the Plan. Except as provided in Section
18 hereof, no such termination can affect options previously granted. Except
as provided in Section 18 hereof, no amendment may make any change in any
option theretofore granted which adversely affects the rights of any
participant. To the extent necessary to comply with Rule 16b-3 or under
Section 423 of the Code (or
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<PAGE> 9
any successor rule or provision or any other applicable law or regulation), the
Company shall obtain shareholder approval in such a manner and to such a degree
as required.
(b) Without shareholder consent, the Board (or its
committee) shall be entitled to change the Offering Periods, limit the
frequency and/or number of changes in the amount withheld during an Offering
Period, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars (with respect to participants who are not
United States residents), permit payroll withholding in excess of the amount
designated by a participant in order to adjust for delays or mistakes in the
Company's processing of properly completed withholding elections (provided,
however, that the Company may not withhold more than the aggregate amount of
payroll deductions designated to be withheld by a participant in any Offering
Period), establish reasonable waiting and adjustment periods and/or accounting
and crediting procedures to ensure that amounts applied toward the purchase of
Common Stock for each participant properly correspond with amounts withheld
from the participant's Compensation, and establish such other limitations or
procedures as the Board (or its committee) determines in its sole discretion
advisable which are consistent with the Plan.
20. Notices. All notices or other communications by a participant
to the Company under or in connection with the Plan shall be deemed to have
been duly given when received in the form specified by the Company at the
location, or by the person, designated by the Company for the receipt thereof.
21. Conditions Upon Issuance of Shares. Shares shall not be
issued with respect to an option unless the exercise of such option and the
issuance and delivery of such shares pursuant thereto shall comply with all
applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Securities Exchange Act
of 1934, as amended, 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 Company with
respect to such compliance.
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 applicable provisions of law.
22. Term of Plan. The Plan shall become effective upon the
earlier to occur of its adoption by the Board of Directors or its approval by
the shareholders of the Company. It shall continue in effect for a term of ten
(10) years unless sooner terminated under Section 19 hereof.
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<PAGE> 10
EXHIBIT A
IRIDEX CORPORATION
1995 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_______ Original Application
Enrollment Date: __________
_______ Change in Payroll Deduction Rate
_______ Change of Beneficiary(ies)
1. _____________________________________ hereby elects to participate in
the Iridex Corporation 1995 Employee Stock Purchase Plan (the
"Employee Stock Purchase Plan") and subscribes to purchase shares of
the Company' s Common Stock in accordance with this Subscription
Agreement and the Employee Stock Purchase Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount
of ____% of my Compensation (not to exceed 10%) on each payday during
each Offering Period, in accordance with the Employee Stock Purchase
Plan. (Please note that no fractional percentages are permitted.)
3. I understand that said payroll deductions shall be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Employee Stock Purchase Plan. I
understand that if I do not withdraw from an Offering Period, any
accumulated payroll deductions will be used to automatically purchase
such Shares.
4. I have received a copy of the complete "Employee Stock Purchase Plan."
I understand that my participation in the Employee Stock Purchase Plan
is in all respects subject to the terms of the Plan.
5. Shares purchased for me under the Employee Stock Purchase Plan should
be issued in the name(s) of (Employee or Employee and Spouse Only):
__________________________________________
6. I understand that if I dispose of any shares received by me pursuant
to the Plan within 2 years after the Enrollment Date (the first day of
the Offering Period during which I purchased such shares), I will be
treated for federal income tax purposes as having received ordinary
income at the time of such disposition in an amount equal to the
excess of the fair market value of the shares at the time such shares
were purchased by me over the price which I paid for the shares. I
hereby agree to notify the Company in writing within 30 days after the
date of any disposition of shares and I will make adequate provision
for Federal, state or other tax withholding obligations, if any, which
arise upon the disposition of the Common Stock. The Company may, but
will not be obligated to, withhold from my compensation the amount
<PAGE> 11
necessary to meet any applicable withholding obligation including any
withholding necessary to make available to the Company any tax
deductions or benefits attributable to sale or early disposition of
Common Stock by me. If I dispose of such shares at any time after the
expiration of the 2-year holding period, I understand that I will be
treated for federal income tax purposes as having received income only
at the time of such disposition, and that such income will be taxed as
ordinary income only to the extent of an amount equal to the lesser of
(1) the excess of the fair market value of the shares at the time of
such disposition over the purchase price which I paid for the shares,
or (2) 15% of the fair market value of the shares on the first day of
the Offering Period. The remainder of the gain, if any, recognized on
such disposition will be taxed as capital gain.
7. I hereby agree to be bound by the terms of the Employee Stock Purchase
Plan. The effectiveness of this Subscription Agreement is dependent
upon my eligibility to participate in the Employee Stock Purchase
Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Employee Stock Purchase Plan:
NAME: (Please print)__________________________________________________________
(First) (Middle) (Last)
_____________________________ ___________________________________________
Relationship
___________________________________________
(Address)
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<PAGE> 12
NAME: (Please print)__________________________________________________________
(First) (Middle) (Last)
_____________________________ ___________________________________________
Relationship
___________________________________________
(Address)
Employee's Social
Security Number:
___________________________________________
Employee's Address: ___________________________________________
___________________________________________
___________________________________________
___________________________________________
I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.
Dated:___________________________________________
Signature of Employee
___________________________________________
Spouse's Signature
(If beneficiary other than spouse)
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<PAGE> 13
EXHIBIT B
IRIDEX CORPORATION
1995 EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
The undersigned participant in the Offering Period of the Iridex
Corporation 1995 Employee Stock Purchase Plan which began on ___________ 19____
(the "Enrollment Date") hereby notifies the Company that he or she hereby
withdraws from the Offering Period. He or she hereby directs the Company to
pay to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The
undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated. The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period, and the undersigned shall be eligible to
participate in succeeding Offering Periods only by delivering to the Company a
new Subscription Agreement.
Name and Address of Participant:
___________________________________________
___________________________________________
___________________________________________
Signature:
___________________________________________
Date:______________________________________
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
IRIDEX Corporation on Forms S-8 (File Nos. _______ and 333-4264) of our reports
dated February 10, 1997, on our audits of the consolidated financial statements
and financial statement schedule of IRIDEX Corporation as of December 31, 1996
and 1995, and for the years ended December 31, 1996, 1995 and 1994 which
reports are included in the Annual Report on Form 10-K.
/s/ COOPERS & LYBRAND L.L.P.
San Jose, California
July 25, 1997
