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EXHIBIT 10.3
DIGENE CORPORATION
AMENDED AND RESTATED OMNIBUS PLAN
ARTICLE 1
PURPOSE; EFFECTIVE DATE; DEFINITIONS
1.1 PURPOSE. This Digene Corporation Omnibus Plan (the "Plan") is
intended to secure for Digene Corporation (the "Company") and its stockholders
the benefits of the incentive inherent in common stock ownership by the
employees of the Company and its subsidiaries and directors of the Company who
are largely responsible for the Company's future growth and continued financial
success and to afford such persons the opportunity to obtain or increase their
proprietary interest in the Company on a favorable basis and thereby have an
opportunity to share in its success.
1.2 EFFECTIVE DATE. Subject to the approval of the Board and to
ratification by the Company's stockholders as provided in Section 7.9, this Plan
shall be effective on and after March 26, 1996.
1.3 DEFINITIONS. Throughout this Plan, the following terms shall have
the meanings indicated:
(a) "AGREEMENT" shall mean an Option Agreement, Restricted
Stock Agreement, Unrestricted Stock Agreement or SAR Agreement.
(b) "BENEFITS" shall mean any one or more of the following
awards that may be granted under this Plan:
(i) Options (including ISOs and NQSOs);
(ii) Stock Appreciation Rights;
(iii) Restricted Stock; or
(iv) Unrestricted Stock.
(c) "BOARD" shall mean the Board of Directors of the Company.
(d) "CHANGE OF CONTROL" shall mean (a) the reorganization,
consolidation or merger of the Company or any of its subsidiaries holding or
controlling a majority of the assets relating to the business of the Company,
with or into any third party (other than a subsidiary); (b) the assignment,
sale, transfer, lease or other disposition of all or substantially all of the
assets of the Company and its subsidiaries taken as a whole; or (c) the
acquisition by any third party or group of third parties acting in concert, of
beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission ("SEC") under the Securities Exchange Act of
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1934, as amended) of shares of voting stock of the Company, the result of which
in the case of any transaction described in clauses (a), (b) and (c) above is
that immediately after the transaction the stockholders of the Company
immediately before the transaction, other than the acquiror, own less than fifty
percent (50%) of the combined voting power of the outstanding voting securities
entitled to vote generally in the election of directors of the surviving or
resulting corporation in a transaction specified in clause (a) above, the
acquiror in a transaction specified in clause (b) above, or the Company or the
acquiror in a transaction specified in clause (c) above.
(e) "CODE" shall mean the Internal Revenue Code of 1986, as
amended, any successor revenue laws of the United States, and the rules and
regulations promulgated thereunder.
(f) "COMMITTEE" shall mean any committee of the Board
designated by the Board to administer this Plan.
(g) "COMMON STOCK" shall mean the common stock, par value $.01
per share, of the Company.
(h) "COMPANY" shall mean Digene Corporation, a Delaware
corporation.
(i) "EMPLOYEE" shall mean any person engaged or proposed to be
engaged as an officer or employee of the Company or one of its subsidiaries.
(j) "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended.
(k) "FAIR MARKET VALUE" shall mean with respect to the Common
Stock on any day, (i) the closing sales price on the immediately preceding
business day of a share of Common Stock as reported on the principal securities
exchange on which shares of Common Stock are then listed or admitted to trading,
or (ii) if not so reported, the closing sales price on the immediately preceding
business day of a share of Common Stock as published in the NASDAQ National
Market Issues report in the Eastern Edition of The Wall Street Journal, or (iii)
if not so reported, the average of the closing bid and asked prices on the
immediately preceding business day as reported on the NASDAQ National Market
System, or (iv) if not so reported, as furnished by any member of the National
Association of Securities Dealers, Inc. selected by the Committee. In the event
that the price of a share of Common Stock shall not be so reported or furnished,
the Fair Market Value of a share of Common Stock shall be determined by the
Committee in good faith. The market value of an Option granted under the Plan on
any day shall be the market value of the underlying Stock, determined as
aforesaid, less the exercise price of the Option. A "business day" is any day,
other than Saturday or Sunday, on which the relevant market is open for trading.
(l) "ISO" shall mean an Option that qualifies as an incentive
stock option under Code Section 422. No Option that is intended to be an ISO
shall be invalid under this Plan for failure to qualify as an ISO.
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(m) "NQSO" shall mean a nonqualified stock option which is an
Option that does not qualify as an incentive stock option under Code Section
422.
(n) "NON-EMPLOYEE DIRECTOR" shall mean a member of the Board
who is not an Employee.
(o) "OPTION" shall mean an option to purchase shares of Common
Stock granted by the Committee. An Option may be either an ISO or a NQSO, but
only an Employee who is actually employed by the Company may be granted an ISO.
(p) "OPTION AGREEMENT" shall mean the certificate evidencing an
Option grant.
(q) "OPTION SHARES" shall mean the shares of Common Stock
purchased upon exercise of an Option.
(r) "PLAN" shall mean this Digene Corporation Omnibus Plan, as
the same may be amended from time to time.
(s) "RESTRICTED STOCK" shall mean Common Stock granted under
Article VI of this Plan, subject to such restrictions as the Committee may
determine, as evidenced in a Restricted Stock Agreement. Shares of Common Stock
shall cease to be Restricted Stock when, in accordance with the terms of the
Restricted Stock Agreement, they become transferable and free of substantial
risk of forfeiture.
(t) "RESTRICTED STOCK AGREEMENT" shall mean the certificate
evidencing the grant of Restricted Stock to an Employee pursuant to this Plan.
(u) "RESTRICTION PERIOD" shall mean the time period during
which Restricted Stock is subject to the restrictions set forth in a Restricted
Stock Agreement.
(v) "SAR AGREEMENT" shall mean the certificate evidencing the
grant of a Stock Appreciation Right to an Employee pursuant to this Plan.
(w) "STOCK APPRECIATION RIGHT" OR "SAR" shall mean the right to
receive cash or Common Stock, granted pursuant to Article V of this Plan and a
SAR Agreement.
(x) "10% STOCKHOLDER" shall mean an individual owning (directly
or by attribution as provided in Code Section 424(d)) stock possessing more than
10% of the total combined voting power of all classes of stock of the Company.
(y) "UNRESTRICTED STOCK" shall mean Common Stock granted under
Article VI of this Plan that is not Restricted Stock.
(z) "UNRESTRICTED STOCK AGREEMENT" shall mean the certificate
evidencing the grant of Unrestricted Stock to an Employee pursuant to this Plan.
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ARTICLE II
ADMINISTRATION
2.1 COMMITTEE ADMINISTRATION. This Plan and the Benefits awarded
hereunder shall be interpreted, construed and administered by the Committee in
its sole discretion. An Employee or Non-Employee Director eligible for Benefits
under the Plan may appeal to the Committee in writing any decision or action of
the Committee with respect to the Plan that adversely affects the Employee or
Non-Employee Director. Upon review of such appeal and in any other case where
the Committee has acted with respect to the Plan, the interpretation and
construction by the Committee of any provisions of this Plan or of any Benefit
shall be conclusive and binding on all parties.
2.2 COMMITTEE COMPOSITION. The Committee shall consist of not less
than two persons who shall be members of the Board and shall be subject to such
terms and conditions as the Board may prescribe. Each Committee member shall be
a "disinterested person" within the meaning of Rule 16b-3 promulgated under the
Exchange Act. Once designated, the Committee shall continue to serve until
otherwise directed by the Board. From time to time, the Board may increase the
size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies however caused and remove all members of the Committee.
A majority of the entire Committee shall constitute a quorum, and the
action of a majority of the members present at any meeting at which a quorum is
present shall be deemed the action of the Committee. In addition, any decision
or determination reduced to writing and signed by all of the members of the
Committee shall be fully as effective as if it had been made by a majority vote
at a meeting duly called and held. Subject to the provisions of this Plan and
the Company's bylaws, and to any terms and conditions prescribed by the Board,
the Committee may make such additional rules and regulations for the conduct of
its business as it shall deem advisable. The Committee shall hold meetings at
such times and places as it may determine.
2.3 COMMITTEE POWERS. The Committee shall have authority to award
Restricted Stock and Unrestricted Stock and to grant Options and SARs pursuant
to an Agreement providing for such terms (not inconsistent with the provisions
of this Plan) as the Committee may consider appropriate. Such terms shall
include, without limitation, as applicable, the number of shares, the Option
price, the medium and time of payment, the term of each award and any vesting
requirements and may include conditions (in addition to those contained in this
Plan) on the exercisability of all or any part of an Option or SAR or on the
transferability or forfeitability of Restricted Stock. Notwithstanding any such
conditions, the Committee may, in its discretion, accelerate the time at which
any Option or SAR may be exercised or the time at which Restricted Stock may
become transferable or nonforfeitable. In addition, the Committee shall have
complete discretionary authority to prescribe the form of Agreements; to adopt,
amend and rescind rules and regulations pertaining to the administration of the
Plan; and to make all other determinations necessary or advisable for the
administration of this Plan. The express grant in the Plan of any specific power
to the Committee shall not be construed as limiting any
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power or authority of the Committee. All expenses of administering this Plan
shall be borne by the Company.
2.4 LIMITATION ON RECEIPT OF BENEFITS BY COMMITTEE MEMBERS. No person
while a member of the Committee shall be eligible to receive any Benefits under
this Plan other than Options granted pursuant to Section 4.2, but a member of
the Committee may exercise Options (but not Stock Appreciation Rights) granted
prior to his or her becoming a member of the Committee.
2.5 GOOD FAITH DETERMINATIONS. No member of the Committee or other
member of the Board shall be liable for any action or determination made in good
faith with respect to this Plan or any Benefit granted hereunder.
ARTICLE III
ELIGIBILITY; TYPES OF BENEFITS; SHARES SUBJECT TO PLAN
3.1 ELIGIBILITY. The Committee shall from time to time determine and
designate the Employees of the Company to receive Benefits under this Plan and
the number of Options, Stock Appreciation Rights and shares of Restricted Stock
and Unrestricted Stock to be awarded to each such Employee or the formula or
other basis on which such Benefits shall be awarded to Employees. In making any
such award, the Committee may take into account the nature of services rendered
by an Employee, commissions or other compensation earned by the Employee, the
capacity of the Employee to contribute to the success of the Company and other
factors that the Committee may consider relevant.
3.2 TYPES OF BENEFITS. Benefits under this Plan may be granted in any
one or any combination of (a) Options, (b) Stock Appreciation Rights, (c)
Restricted Stock and (d) Unrestricted Stock, as described in this Plan. The
Committee may (x) give Employees a choice between two or more Benefits or
combinations of Benefits, (y) award Benefits in tandem so that acceptance of or
exercise of one Benefit cancels the right of an Employee to another and (z)
award Benefits in any combination or combinations and subject to any condition
or conditions consistent with the terms of this Plan that the Committee in its
sole discretion may consider appropriate.
3.3 SHARES SUBJECT TO THIS PLAN. Subject to the provisions of Section
4.1(e) (relating to adjustment for changes in Common Stock), the maximum number
of shares that may be issued under this Plan shall not exceed in the aggregate
two million shares of Common Stock. Such shares may be authorized and unissued
shares or authorized and issued shares that have been reacquired by the Company.
If any Options granted under this Plan shall for any reason terminate or expire
or be surrendered without having been exercised in full, then the shares not
purchased under such Options shall be available again for grant hereunder.
Anything in this Plan to the contrary notwithstanding, in no event shall any
Employee receive in any calendar year Benefits under this Plan involving more
than 500,000 shares of Common Stock (subject to adjustment as provided in
Section 4.1(e)).
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3.4 $100,000 LIMITATION. Except as provided elsewhere in this Section,
the Committee shall not grant an ISO to, or modify the exercise provisions of an
outstanding ISO for, any person who, at the time of grant or modification, as
applicable, would thereby hold ISOs issued by the Company if the aggregate Fair
Market Value (determined as of the respective dates of grant and modification of
each Option) of the Option Shares underlying such ISOs as are exercisable for
the first time during any calendar year would exceed $100,000 (or such other
limitation as may be prescribed by the Code from time to time). The foregoing
restriction on modification of outstanding ISOs shall not preclude the Committee
from modifying an outstanding ISO if, as a result of such modification and with
the consent of the holder, such Option no longer constitutes an ISO.
Furthermore, if the $100,000 limitation (or such other limitation prescribed by
the Code) described in this Section is exceeded, then the ISO, the granting or
modification of which resulted in exceeding such limitation, shall be treated as
an ISO up to the limitation, and the excess shall be treated as a NQSO.
ARTICLE IV
STOCK OPTIONS
4.1 GRANT; TERMS AND CONDITIONS. The Committee, in its discretion, may
from time to time grant ISOs or NQSOs, or both, to any Employee eligible to
receive Benefits under this Plan. Each Employee who is granted an Option shall
receive an Option Agreement from the Company in a form specified by the
Committee and containing such provisions, consistent with this Plan, as the
Committee, in its sole discretion, shall determine at the time the Option is
granted.
(a) NUMBER OF SHARES. Each Option Agreement shall state the
number of shares of Common Stock to which it pertains.
(b) OPTION PRICE. Each Option Agreement shall state the Option
exercise price, which, in the case of an Option intended to be an ISO, shall not
be less than 100% of the Fair Market Value per share of Common Stock on the date
of grant of the Option. In the case of an ISO granted to a 10% Stockholder, the
Option exercise price shall not be less than 110% of the Fair Market Value per
share of Common Stock on the date of grant of the Option. The date of the grant
of an Option shall be the date specified by the Committee in its grant of the
Option. The price at which each share of Common Stock covered by an NQSO granted
under the Plan may be purchased shall be the price determined by the Committee,
in its absolute discretion, to be suitable to attain the purposes of this Plan.
(c) MEDIUM AND TIME OF PAYMENT. Upon the exercise of an Option,
the Option exercise price shall be payable in United States dollars, in cash
(including by check) or (unless the Committee otherwise prescribes) in shares of
Common Stock owned by the optionee (but not with Restricted Stock prior to the
expiration of the Restriction Period), in NQSOs granted to the optionee under
the Plan which are then exercisable (provided that the purchase price of Common
Stock under an ISO may not be paid in NQSOs), or in a combination of cash,
Common Stock and NQSOs. If all or any portion of the Option exercise price is
paid in Common Stock owned by the optionee, then that stock shall be valued at
its Fair Market Value
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as of the date the Option is exercised. If all or any portion of the Option
exercise price is paid in NQSOs granted to the optionee under the Plan, then
such NQSOs shall be valued at their Fair Market Value as of the date the Option
is exercised. For the purpose of assisting an optionee to exercise an Option,
the Company may, in the discretion of the Board, make loans to the optionee or
guarantee loans made by third parties to the optionee, in either case on such
terms and conditions as the Board may authorize.
(d) TERM AND EXERCISE OF OPTIONS. The term of each Option shall
be determined by the Committee at the time the Option is granted; provided that
the term of an Option shall in no event be more than ten years from the date of
grant or, in the case of an ISO granted to a 10% Stockholder, more than five
years from the date of grant. Not less than one hundred shares may be purchased
at any one time unless the number purchased is the total number at the time
purchasable under the Option. During the lifetime of an optionee, the Option
shall be exercisable only by him or her and shall not be assignable or
transferable by him or her and no person shall acquire any rights therein.
Following an optionee's death, the Option may be exercised (to the extent
permitted under the Plan) by the person designated by the optionee as a
beneficiary in a written notification delivered to the Committee prior to the
optionee's death, or if there is no such written designation, by the executor or
administrator of the optionee's estate or by the person or persons to whom such
rights pass by will or by the laws of descent and distribution.
(e) RECAPITALIZATION; REORGANIZATION. Subject to any required
action by the stockholders of the Company, the maximum number of shares of
Common Stock that may be issued under this Plan pursuant to Section 3.3 above,
the number of shares of Common Stock with respect to which Options will be
granted to Non-Employee Directors pursuant to Section 4.2, the number of shares
of Common Stock covered by each outstanding Option, the number of shares of
Common Stock to which each Stock Appreciation Right relates, the kind of shares
subject to outstanding Options and the per share exercise price under each
outstanding Option shall be adjusted, in each case, to the extent and in the
manner the Committee deems appropriate for any increase or decrease in the
number of issued shares of Common Stock resulting from a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, subdivision or consolidation of shares or the
payment of a stock dividend (but only on the Common Stock) or any other change
in the corporate structure or state of the Company.
Subject to any action that may be required on the part of the
stockholders of the Company, if the Company is the surviving corporation in any
merger, consolidation, sale, transfer, acquisition, tender offer or exchange
offer which does not result in a Change of Control, then each outstanding Option
and Stock Appreciation Right shall pertain to and apply to the securities or
other consideration that a holder of the number of shares of Common Stock
subject to the Option or to which the Stock Appreciation Right relates would
have been entitled to receive in such transaction.
If the Company is the surviving corporation in any merger,
consolidation, sale, transfer, acquisition, tender offer or exchange offer which
results in a Change of Control, each optionee shall, in such event, have the
right immediately prior to such transaction to exercise his
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or her Option or Stock Appreciation Right in whole or in part without regard to
any installment provision contained in his or her Agreement, but if a Stock
Appreciation Right has been granted in connection with an Option then neither
the Option nor the Stock Appreciation Right shall be exercisable within six
months after their grant except in the event of death or disability of the
optionee; provided, however, that the exercisability of any Option or Stock
Appreciation Right shall not be accelerated if, in the opinion of the Board,
such acceleration would prevent pooling of interests accounting treatment for
the Change of Control transaction and such accounting treatment is desired by
the parties to such transaction. Any Option or Stock Appreciation Right not
exercised immediately prior to such transaction shall pertain to and apply to
the securities or other consideration that a holder of the number of shares of
Common Stock subject to the Option or to which the Stock Appreciation Right
relates would have been entitled to receive in the transaction. This paragraph
shall apply to any outstanding Options which are ISOs to the extent permitted by
Code Section 422(d), and such outstanding ISOs in excess thereof shall,
immediately upon the occurrence of such a transaction, be treated for all
purposes of the Plan as NQSOs and shall be immediately exercisable as such as
provided in such paragraph.
A merger, consolidation, sale, transfer, acquisition, tender offer
or exchange offer in which the Company is not the surviving corporation, other
than such a transaction effected for the purpose of changing the Company's
domicile, shall cause each holder of an outstanding Option and Stock
Appreciation Right to have the right immediately prior to such transaction to
exercise his or her Option or Stock Appreciation Right in whole or in part
without regard to any installment provision contained in his or her Agreement,
but if a Stock Appreciation Right has been granted in connection with an Option
then neither the Option nor the Stock Appreciation Right shall be exercisable
within six months after their grant except in the event of death or disability
of the optionee. Any Option or Stock Appreciation Right not exercised
immediately prior to such transaction shall pertain to and apply to the
securities or other consideration that a holder of the number of shares of
Common Stock subject to the Option or to which the Stock Appreciation Right
relates would have been entitled to receive in the transaction. This paragraph
shall apply to any outstanding Options which are ISOs to the extent permitted by
Code Section 422(d), and such outstanding ISOs in excess thereof shall,
immediately upon the occurrence of such a transaction, be treated for all
purposes of the Plan as NQSOs and shall be immediately exercisable as such as
provided in such paragraph.
A dissolution or liquidation of the Company shall cause each
outstanding Option and Stock Appreciation Right to terminate, provided that each
holder shall, in such event, have the right immediately prior to such
dissolution or liquidation to exercise his or her Option or Stock Appreciation
Right in whole or in part without regard to any installment provision contained
in his or her Agreement, but if a Stock Appreciation Right has been granted in
connection with an Option then neither the Option nor the Stock Appreciation
Right shall be exercisable within six months after their grant except in the
event of death or disability of the optionee.
Notwithstanding the foregoing, in no event shall any Option be
exercisable after the date of termination of the exercise period of such Option.
In the case of a merger, consolidation, sale, transfer,
acquisition, tender offer or
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exchange offer effected for the purpose of changing the Company's domicile, each
outstanding Option and Stock Appreciation Right shall continue in effect in
accordance with its terms and shall apply or relate to the same number of shares
of common stock of such surviving corporation as the number of shares of Common
Stock to which it applied or related immediately prior to such transaction,
adjusted for any increase or decrease in the number of outstanding shares of
common stock of the surviving corporation effected without receipt of
consideration.
In the event of a change in the Common Stock as presently
constituted, which change is limited to a change of all of the authorized shares
with par value into the same number of shares with a different par value or
without par value, the shares resulting from any such change shall be deemed to
be the Common Stock within the meaning of this Plan.
The foregoing adjustments shall be made by the Committee, whose
determination shall be final, binding and conclusive.
Except as expressly provided in this subsection, the holder of an
Option or Stock Appreciation Right shall have no rights by reason of (i) any
subdivision or consolidation of shares of any class, (ii) any stock dividend,
(iii) any other increase or decrease in the number of shares of stock of any
class, (iv) any dissolution, liquidation, merger or consolidation or spin-off,
split-off or split-up of assets of the Company or stock of another corporation
or (v) any issuance by the Company of shares of stock of any class or securities
convertible into shares of stock of any class. Moreover, except as expressly
provided in this subsection, the occurrence of one or more of such events shall
not affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to the Option or the
number of shares that relate to a Stock Appreciation Right.
The grant of an Option or Stock Appreciation Right pursuant to
this Plan shall not affect in any way the right or power of the Company to make
adjustments, reclassifications, reorganizations or changes of its capital or
business structure or to merge or to consolidate or to dissolve, liquidate, sell
or otherwise transfer all or any part of its business or assets.
The provisions of this Section 4.1(e) shall be limited in respect
of ISOs to the extent necessary to comply with the applicable provisions of Code
Section 424(a).
(f) RIGHTS AS A STOCKHOLDER. Subject to Section 7.10 of this
Plan regarding uncertificated shares, an optionee or a transferee of an Option
shall have no rights as a stockholder with respect to any shares covered by his
or her Option until the date of the issuance of a stock certificate to him or
her for those shares upon payment of the exercise price. No adjustments shall be
made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued, except as provided in
subsection 4.1(e).
(g) MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS. Subject to
the terms and conditions and within the limitations of this Plan, the Committee
may modify, extend or renew outstanding Options granted under this Plan or
accept the surrender of outstanding Options (to the extent not theretofore
exercised) and authorize the granting of new Options in
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substitution therefor (to the extent not theretofore exercised). No modification
of an Option shall, without the consent of the optionee, alter or impair any
rights or obligations under any Option theretofore granted under this Plan.
(h) EXERCISABILITY AND TERM OF OPTIONS. Unless earlier
terminated, Options granted pursuant to this Plan shall be exercisable at any
time on or after the dates of exercisability and before the expiration date set
forth in the Option Agreement. Notwithstanding the foregoing, an Option shall
terminate and may not be exercised if the Employee to whom it is granted ceases
to be employed by the Company, except that: (1) unless the Committee shall
determine that the Employee's employment was terminated for conduct that in the
judgment of the Committee involves dishonesty or action by the Employee that is
detrimental to the best interest of the Company, the Employee may at any time
within three months after termination of his or her employment exercise his or
her Option but only to the extent the Option was exercisable by him or her on
the date of termination of employment; (2) if such Employee's employment
terminates on account of total and permanent disability, then the Employee may
at any time within one year after termination of his or her employment exercise
his or her Option but only to the extent that the Option was exercisable on the
date of termination of employment; and (3) if such Employee dies while in the
employ of the Company, or within the three or twelve month period following
termination of his or her employment as described in clause (1) or (2) above,
then his or her Option may be exercised at any time within twelve months
following his or her death by the person specified in Section 4.1(d), but only
to the extent that such Option was exercisable by him or her on the date of
termination of employment. The last sentence shall apply to any outstanding
Options which are ISOs to the extent permitted by Code Section 422, and such
outstanding ISOs in excess thereof shall, immediately upon the occurrence of the
event described in such sentence, be treated for all purposes of the Plan as
NQSOs and shall be immediately exercisable as such as provided in such sentence.
The Committee may, in its discretion, provide in any Option Agreement or
determine at any time after the date of grant that the exercisability of an
Option will be accelerated, in whole or in part, in the event of an Employee's
retirement, death or disability. Any cessation of employment, for purposes of
ISOs only, shall include any leave of absence in excess of 90 days unless the
optionee's reemployment rights are guaranteed by law or by contract. The
Committee may, in its discretion, extend the post-termination exercise periods
set forth in this subsection, but not beyond the expiration date of the Option.
Notwithstanding anything to the contrary in this subsection, an Option may not
be exercised by anyone after the expiration of its term.
4.2 [DELETED BY AMENDMENT.]
4.3 OTHER TERMS AND CONDITIONS. Through the Option Agreements
authorized under this Plan, the Committee may impose such other terms and
conditions, not inconsistent with the terms hereof, on the grant or exercise of
Options, as it deems advisable.
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ARTICLE V
STOCK APPRECIATION RIGHTS
5.1 GRANT OF STOCK APPRECIATION RIGHTS. The Committee, in its
discretion, may from time to time grant Stock Appreciation Rights to Employees
under this Plan. Such Stock Appreciation Rights may, but need not, be granted in
conjunction with an Option grant.
5.2 EXERCISE. Stock Appreciation Rights shall entitle the holder, upon
exercise thereof in whole or in part, to receive payment in the amount and form
determined pursuant to subsection 5.3(b). The exercise of Stock Appreciation
Rights shall result in a termination of the Stock Appreciation Rights with
respect to the number of shares covered by the exercise and, if granted in
conjunction with an Option, shall also result in a termination of the related
Option with respect to the number of shares covered by the exercise.
5.3 TERMS AND CONDITIONS. Stock Appreciation Rights granted under this
Plan to Employees shall be evidenced by SAR Agreements, which shall be in such
form and contain such provisions, consistent with this Plan, as the Committee,
in its sole discretion, shall determine at the time the Stock Appreciation Right
is granted.
(a) Stock Appreciation Rights shall not be exercisable during
the first six months after their date of grant. Such rights shall not be
transferable other than by will or by the laws of descent and distribution and
shall be exercisable during the holder's lifetime only by the holder.
(b) Upon exercise of Stock Appreciation Rights the holder shall
be entitled to receive therefor payment, in the sole discretion of the
Committee, in the form of shares of Common Stock (rounded down to the next whole
number so that no fractional shares are issued), cash or any combination
thereof. The amount of such payment shall be equal in value to the difference
between the Stock Appreciation Right exercise price per share and the Fair
Market Value per share of the Common Stock on the date the Stock Appreciation
Right is exercised, multiplied by the number of shares with respect to which the
Stock Appreciation Right shall have been exercised.
(c) Stock Appreciation Rights shall terminate in accordance
with the provisions of Section 4.1(h) if the holder's employment with the
Company terminates.
5.4 EFFECT ON RELATED STOCK OPTION. The number of shares of Common
Stock with respect to which Stock Appreciation Rights are exercised (rather than
the number of shares issued by the Company upon such exercise) shall be deemed
for the purpose of Section 3.3 to have been issued under an Option granted
pursuant to this Plan and shall not thereafter be available for the granting of
further Benefits under this Plan.
5.5 NO RIGHTS AS A STOCKHOLDER. Holders of Stock Appreciation Rights
hereunder shall have no rights as stockholders in respect thereof. No
adjustments shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or
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distributions or other rights for which the record date is prior to the date
such stock certificate is issued, except as provided in subsection 4.1(e).
ARTICLE VI
RESTRICTED AND UNRESTRICTED STOCK
6.1 RESTRICTED STOCK. The Committee, in its discretion, may from time
to time award Restricted Stock to any Employee eligible to receive Benefits
under this Plan. Each Employee who is awarded Restricted Stock shall receive a
Restricted Stock Agreement from the Company in a form specified by the Committee
and containing the terms and conditions, consistent with this Plan, as the
Committee, in its sole discretion, shall determine at the time the award is
made. Such conditions may include, but shall not be limited to, the deferral of
a percentage of the Employee's annual cash compensation, not including dividends
paid on Restricted Stock, if any, to be applied toward the purchase of
Restricted Stock upon such terms and conditions, including such discounts, as
may be set forth in the Restricted Stock Agreement.
Restricted Stock awarded to Employees may not be sold, transferred,
pledged or otherwise encumbered during a Restriction Period commencing on the
date of the award and ending at such later date or dates as the Committee may
designate at the time of the award. The Employee shall have the entire
beneficial ownership of the Restricted Stock awarded to him or her, including
the right to receive dividends and the right to vote such Restricted Stock.
If an Employee ceases to be employed by the Company prior to the
expiration of the Restriction Period, then he or she shall forfeit all of his or
her Restricted Stock with respect to which the Restriction Period has not yet
expired; provided, however, that the Restricted Stock Agreements, in the
discretion of the Committee and pursuant to such terms and conditions as it may
impose, may provide: (1) that, if such Employee's employment terminates for any
reason other than conduct that in the judgment of the Committee involves
dishonesty or action by the Employee that is detrimental to the best interests
of the Company, then the Restricted Stock or any related compensation deferral
or a portion thereof shall not be forfeited; (2) that, if such Employee's
employment terminates on account of total and permanent disability, then the
Employee shall not forfeit his or her Restricted Stock or any related
compensation deferral or a portion thereof; and (3) that, if such Employee dies
while employed by the Company, then his or her Restricted Stock or any related
compensation deferral or a portion thereof is not forfeited.
Subject to Section 7.10, each Employee who is awarded Restricted Stock
may, but need not, be issued a stock certificate in respect of such shares of
Restricted Stock. Each certificate registered in the name of an Employee, if
any, shall bear an appropriate legend referring to the terms, conditions and
restrictions applicable to such award as specifically set forth in the
Restricted Stock Agreement.
The Committee shall require that any stock certificate issued in the name
of an Employee representing shares of Restricted Stock be held in the custody of
the Company until the expiration of the Restriction Period applicable to such
Restricted Stock and that, as a condition of such issuance of a certificate for
Restricted Stock, the Employee shall have delivered a stock
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power, endorsed in blank, relating to the shares covered by such certificate. In
no event shall the Restriction Period end prior to the payment by the Employee
to the Company of the amount of any federal, state or local income or employment
tax withholding that may be required with respect to the Restricted Stock.
If any change is made in the Common Stock by reason of any merger,
consolidation, reorganization, recapitalization, stock dividend, split up,
combination of shares, exchange of shares, change in corporate structure, or
otherwise, then any shares received by an Employee with respect to Restricted
Stock shall be subject to the same restrictions applicable to such Restricted
Stock and the certificates representing such shares shall be deposited with the
Company.
6.2 UNRESTRICTED STOCK. The Committee, in its discretion, may from
time to time award Unrestricted Stock to any Employee eligible to receive
Benefits under this Plan. Each Employee who is awarded Unrestricted Stock shall
receive an Unrestricted Stock Agreement from the Company in a form specified by
the Committee and containing the terms and conditions of the award and such
other matters, consistent with this Plan, as the Committee, in its sole
discretion, shall determine at the time the award is made. Such conditions may
include, but shall not be limited to, the deferral of a percentage of the
Employee's annual cash compensation, not including dividends paid on the
Unrestricted Stock, if any, to be applied toward the purchase of Unrestricted
Stock upon such terms and conditions, including such discounts, as may be set
forth in the Unrestricted Stock Agreement. Upon the issuance of Unrestricted
Stock to an Employee hereunder, the Employee shall have the entire beneficial
ownership and all the rights and privileges of a stockholder with respect to the
Unrestricted Stock awarded to him or her, including the right to receive
dividends and the right to vote such Unrestricted Stock. Subject to Section 7.10
of this Plan, each Employee who is awarded Unrestricted Stock may, but need not,
be issued a stock certificate in respect of such shares of Unrestricted Stock.
ARTICLE VII
MISCELLANEOUS
7.1 WITHHOLDING TAXES. An Employee granted Options, Restricted Stock,
Unrestricted Stock or Stock Appreciation Rights under this Plan shall be
conclusively deemed to have authorized the Company to withhold from the salary,
commissions or other compensation of such Employee funds in amounts or property
(including Common Stock) in value equal to any federal, state and local income,
employment or other withholding taxes applicable to the income recognized by
such Employee and attributable to the Options, Option Shares, Restricted Stock,
Unrestricted Stock or Stock Appreciation Rights as, when and to the extent, if
any, required by law; provided, however, that, in lieu of the withholding of
federal, state and local taxes as herein provided, the Company may require that
the Employee (or other person exercising such Option or Stock Appreciation
Rights or holding such Restricted Stock or Unrestricted Stock) pay the Company
an amount equal to the federal, state and local withholding taxes on such income
at the time such withholding is required or such other time as shall be
satisfactory to the Company.
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7.2 AMENDMENT, SUSPENSION, DISCONTINUANCE OR TERMINATION OF PLAN. The
Committee may from time to time amend, suspend or discontinue this Plan or
revise it in any respect whatsoever for the purpose of maintaining or improving
the effectiveness of this Plan as an incentive device, for the purpose of
conforming this Plan to applicable governmental regulations or to any change in
applicable law or regulations or for any other purpose permitted by law;
provided, however, that no such action by the Committee shall adversely affect
any Benefit theretofore granted under this Plan without the consent of the
holder so affected; and provided further that the Committee may not materially
increase the number of shares of Common Stock authorized under Section 3.3 of
this Plan or materially modify this Plan's requirements as to eligibility for
participation or materially increase the benefits accruing to participants under
this Plan, in any such case without the approval of the stockholders of the
Company. Unless sooner terminated by the Committee, this Plan will terminate on
March 26, 2006.
7.3 GOVERNING LAW. This Plan shall be governed by, and construed in
accordance with, the laws of the State of Maryland (without giving effect to
principles of conflict of laws).
7.4 DESIGNATION. This Plan may be referred to in other documents and
instruments as the "Digene Corporation Omnibus Plan."
7.5 INDEMNIFICATION OF COMMITTEE. In addition to such other rights of
indemnification as they may have as directors or as members of the Committee,
the members of the Committee shall be indemnified by the Company against the
reasonable expenses, including attorneys' fees, actually and necessarily
incurred in connection with the defense of any investigation, action, suit or
proceeding, or in connection with any appeal therefrom, to which they or any of
them may be a party by reason of any action taken or failure to act under or in
connection with this Plan or any Benefit, and against all amounts paid by them
in settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in or dismissal or other discontinuance of any such investigation, action, suit
or proceeding, except in relation to matters as to which it shall be adjudged in
such investigation, action, suit or proceeding that such Committee member is
liable for negligence or misconduct in the performance of his or her duties;
provided that, within 60 days after institution of any such investigation,
action, suit or proceeding, a Committee member shall in writing offer the
Company the opportunity, at its own expense, to handle and defend the same.
7.6 RESERVATION OF SHARES. The Company shall at all times during the
term of this Plan, and so long as any Benefit shall be outstanding, reserve and
keep available (and will seek or obtain from any regulatory body having
jurisdiction any requisite authority in order to issue) such number of shares of
its Common Stock as shall be sufficient to satisfy the requirements of this
Plan. Inability of the Company to obtain from any regulatory body of appropriate
jurisdiction authority considered by the Company to be necessary or desirable to
the lawful issuance of any shares of its Common Stock hereunder shall relieve
the Company of any liability in respect of the nonissuance or sale of such
Common Stock as to which such requisite authority shall not have been obtained.
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7.7 APPLICATION OF FUNDS. The proceeds received by the Company from
the sale of Common Stock pursuant to the exercise of Options will be used for
general corporate purposes.
7.8 NO OBLIGATION TO EXERCISE. The granting of a Benefit shall impose
no obligation upon the holder to exercise or otherwise realize the value of that
Benefit.
7.9 APPROVAL OF STOCKHOLDERS. No Benefit granted under this Plan shall
be enforceable against the Company unless and until this Plan has been approved
or ratified by the stockholders of the Company in the manner and to the extent
required by the Exchange Act and the General Corporation Law of the State of
Delaware.
7.10 UNCERTIFICATED SHARES. Each Employee who exercises an Option to
acquire Common Stock or is awarded Restricted Stock or Unrestricted Stock may,
but need not, be issued a stock certificate in respect of the Common Stock so
acquired. A "book entry" (i.e., a computerized or manual entry) shall be made in
the records of the Company to evidence the issuance of shares of Common Stock to
an Employee where no certificate is issued in the name of the Employee. Such
Company records, absent manifest error, shall be binding on Employees. In all
instances where the date of issuance of shares may be deemed significant but no
certificate is issued in accordance with this Section 7.10, the date of the book
entry shall be the relevant date for such purposes.
7.11 FORFEITURE FOR COMPETITION. If a participant in this Plan provides
services to a competitor of the Company or any of its subsidiaries, whether as
an employee, officer, director, independent contractor, consultant, agent or
otherwise, such services being of a nature that can reasonably be expected to
involve the skills and experience used or developed by the participant while an
Employee, then that participant's rights to any Benefits hereunder shall
automatically be forfeited, subject to a determination to the contrary by the
Committee.
7.12 SUCCESSORS. This Plan shall be binding upon any and all successors
of the Company.
7.13 EMPLOYMENT RIGHTS. Nothing in this Plan or in any Agreement shall
confer on any Employee any right to continue in the employ of the Company or any
of its subsidiaries or shall interfere in any way with the right of the Company
or any of its subsidiaries to terminate such person's employment at any time.
Nothing in this Plan or in any Agreement shall confer on any Non-Employee
Director any right to continue to serve as a member of the Board, nor is there
any implied agreement or understanding that such Non-Employee Director will be
nominated for reelection to the Board.
7.14 OTHER ACTIONS. Nothing contained in the Plan shall be construed to
limit the authority of the Company to exercise its corporate rights and powers,
including, but not by way of limitation, the right of the Company to grant
options for proper corporate purposes other than under the Plan with respect to
any employee or other person, firm, corporation or association.
7.15 TAX TREATMENT AND CHARACTERIZATION. Neither the Company nor any
other person represents or warrants to any Plan participant (i) that any Option
granted hereunder shall
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be considered an ISO for applicable tax purposes or (ii) that favorable or
desirable tax treatment or characterization will be applicable in respect of any
Benefit.
7.16 LEGEND. The Committee may require each person exercising an Option
to represent to and agree with the Company in writing that he or she is
acquiring the Option Shares without a view to distribution thereof. In addition
to any legend required by this Plan, the stock certificates representing such
Option Shares may include any legend which the Committee deems appropriate to
reflect any restrictions on transfer.
All certificates for Option Shares shall be subject to such stock
transfer orders and other restrictions as the Committee may deem advisable under
the rules, regulations and other requirements of the Securities and Exchange
Commission, any stock exchange upon which the Common Stock is then listed, any
applicable federal or state securities law, and any applicable corporate law,
and the Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference to such restrictions.
AS AMENDED BY THE BOARD AT ITS JULY 30, 1998 MEETING - SECTIONS 1.1 AND 1.3(h)
REVISED TO INCLUDE SUBSIDIARIES OF THE COMPANY.
AS AMENDED BY THE BOARD AT ITS SEPTEMBER 10, 1998 MEETING - LAST SENTENCE OF
SECTION 4.1(d) AMENDED TO INCLUDE EXERCISE BY A DESIGNATED BENEFICIARY AND
SUBSECTION (3) OF SECTION 4.1(h) REVISED.
AS AMENDED AND RESTATED BY THE BOARD BY UNANIMOUS WRITTEN CONSENT DATED
SEPTEMBER 21, 2000 AND APPROVED BY THE STOCKHOLDERS AT THE ANNUAL MEETING HELD
ON OCTOBER 26, 2000 - ADDING "CHANGE OF CONTROL" DEFINITION TO SECTION 1.3(d)
AND AMENDING AND RESTATING SECTION 4.1(e) WITH PROVISIONS REGARDING THE
TREATMENT OF OPTIONS IN THE EVENT OF A CHANGE OF CONTROL TRANSACTION.
AS AMENDED BY THE BOARD AT ITS OCTOBER 26, 2000 MEETING - "CHANGE OF CONTROL"
DEFINITION CLARIFIED; AND SECTION 4.2 (AUTOMATIC GRANT TO NON-EMPLOYEE
DIRECTORS) DELETED AND MOVED TO THE DIRECTORS' PLAN.
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