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Exhibit 10.28
OPLINK COMMUNICATIONS, INC.
1995 STOCK PLAN
SECTION 1. PURPOSE
The purpose of the Plan is to offer selected employees, directors and
consultants an opportunity to acquire a proprietary interest in the success
of the Company, to encourage such selected persons to remain in the employ of
the Company and to attract new employees by allowing such persons to purchase
Shares of the Company's Common Stock. The Plan provides for the grant of
Options to purchase Shares. Options granted under the Plan may be Incentive
Stock Options or Nonstatutory Stock Options. Stock Purchase Rights may also be
granted under the Plan.
SECTION 2. DEFINITIONS
(a) "BOARD" means the Board of Directors of the Company.
(b) "CODE" means the Internal Revenue Code of 1986, as amended.
(c) "COMMITTEE" means a committee of the Board of Directors which
is authorized to administer the Plan under Section 4 herein. In the event the
Company becomes subject to Section 16 of the Exchange Act, the Committee
shall have a membership composition which will enable the Plan to qualify
under Rule 16b-3 with regard to Options granted to persons who are subject to
Section 16 of the Exchange Act.
(d) "COMMON STOCK" means the Common Stock of the Company.
(e) "COMPANY" means Oplink Communications, Inc.
(f) "CONSULTANT" means any person, including an advisor, who is
engaged by the Company or Subsidiary to render consulting or advisory
services and is compensated for such services.
(g) "CONTINUOUS STATUS AS AN EMPLOYEE" means the absence of any
interruption or termination of the employment relationship by the Company or
any Subsidiary. 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 Board, provided that such leave is for a period of
not more than ninety (90) days, unless reemployment upon the expiration of
such leave is guaranteed by contract or statute, or unless provided otherwise
pursuant to Company policy adopted from time to time; or in the case of
transfers between locations of the Company or between the Company, its
Subsidiaries or its successor.
(h) "EMPLOYEE" means any person, including officers and
directors, employed by the Company 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.
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(i) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
(j) "FAIR MARKET VALUE" means, as of any date, the value of
Common Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system including without limitation the
National Market System of the National Association of Securities Dealers,
Inc. Automated Quotation ("Nasdaq") System, its Fair Market Value shall be
the closing sales price for such stock (or the closing bid, if no sales were
reported, as quoted on such system or exchange for the last market trading
day prior to the time of determination) as reported in the Wall Street
Journal or such other source as the Administrator deems reliable;
(ii) If the Common Stock is quoted on the Nasdaq System (but not
on the Nasdaq National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high and low asked prices for the Common Stock;
or
(iii) 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.
(k) "INCENTIVE STOCK OPTION" means an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.
(l) "NONSTATUTORY STOCK OPTION" means an Option not intended to
qualify as an Incentive Stock Option.
(m) "OPTION" means a stock option granted pursuant to the Plan
that entitles the holder to purchase Shares.
(n) "OPTIONED STOCK" means the Common Stock subject to an Option.
(o) "OPTIONEE" means an Employee or Consultant who receives an
Option.
(p) "PLAN" means the Oplink Communications, Inc. 1995 Stock Plan,
as amended from time to time.
(q) "PURCHASER" means an Employee or Consultant who exercises a
Stock Purchase Right.
(r) "RESTRICTED STOCK" means Shares purchased pursuant to the
grant of a Stock Purchase Right.
(s) "SHARE" means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.
(t) "STOCK PURCHASE RIGHT" means the right to purchase Restricted
Stock granted pursuant to Section 11 of the Plan.
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(u) "SUBSIDIARY" means any corporation of which the Company
and/or one or more other Subsidiaries own not less than 50 percent of the
total combined voting power of all classes of outstanding stock of such
corporation. A corporation that attains the status of a Subsidiary on a date
after the adoption of the plan shall be considered a Subsidiary commencing as
of such date.
(v) "TAX DATE" means the date upon which the withholding tax
obligation is determined pursuant to Section 12(b) herein.
SECTION 3. STOCK SUBJECT TO THE PLAN
Subject to the provisions of Section 13 of the Plan, the maximum
aggregate number of shares which may be optioned and sold under the Plan is
2,000,000 Shares of Common Stock. The shares may be authorized, but unissued,
or reacquired Common Stock. If an Option or Stock Purchase Right should
expire or become unexercisable for any reason without having been exercised
in full, the unpurchased Shares which were subject thereto shall, unless the
Plan shall have been terminated, become available for future grant under the
Plan. The Company, during the term of this Plan, will at all times reserve
and keep available such number of Shares as shall be sufficient to satisfy
the requirements of the Plan.
SECTION 4. ADMINISTRATION
(a) COMMITTEE MEMBERSHIP. The Plan shall be administered by the
Committee, which shall consist of members of the Board. The members of the
Committee shall be appointed by the Board. If no Committee has been
appointed, the entire Board shall constitute the Committee.
(b) POWERS OF THE COMMITTEE. Subject to the provisions of the
Plan and the specific duties delegated by the Board, the Committee shall have
full authority and discretion to take the following actions:
(i) to determine the Fair Market Value of the Common Stock;
(ii) to select the officers, Consultants and Employees to whom
Options and Stock Purchase Rights may from time to time be granted under the
Plan;
(iii) to determine whether and to what extent Options and Stock
Purchase Rights or any combination thereof, are granted under the Plan;
(iv) to determine the number of Shares to be covered by each
such award granted hereunder;
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any award granted hereunder including, but not
limited to, the share price and any restriction or limitation, based in each
case on such factors as the Committee shall determine in its sole discretion;
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(vii) to determine the terms and restrictions applicable to
Stock Purchase Rights and the Restricted Stock purchased by exercising such
Stock Purchase Rights; and
(viii) to make any other such determinations with respect to
awards under the Plan as it shall deem appropriate.
(c) EFFECT OF COMMITTEE'S DECISION. All decisions, determinations
and interpretations of the Committee shall be final and binding on all
Optionees and Purchasers and any other holders of any Options or Stock
Purchase Rights.
SECTION 5. ELIGIBILITY
(a) GENERAL RULE. Nonstatutory Stock Options may be granted to
Employees and Consultants. Incentive Stock Options may be granted only to
Employees. An Employee or Consultant who has been granted an Option may, if
he is otherwise eligible, be granted an additional Option or Options.
(b) STOCK OPTION AGREEMENT. Each grant of an Option under the
Plan shall be evidenced by a stock option agreement between the Optionee and
the Company. All stock option agreements shall be subject to all applicable
terms and conditions of the Plan and may be subject to any other terms and
conditions which are not inconsistent with the Plan and which the Committee
deems appropriate. The provisions of the various stock option agreements
entered into under the Plan are not required to be identical.
(c) INCENTIVE STOCK OPTION LIMITATION. Each Option shall be
designated in the written option agreement as either an incentive Stock
Option or a Nonstatutory Stock Option. However, notwithstanding such
designations, to the extent that the aggregate Fair Market Value of the
Shares with respect to which Options designated as Incentive Stock Options
are exercisable for the first time by any Optionee during any calendar year
(under all plans of the Company or any Parent or Subsidiary) exceeds
$100,000, such excess Options shall be treated as Nonstatutory Stock Options.
(d) NONTRANSFERABILITY OF OPTIONS. All Options granted under the
Plan 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 only by
the Optionee.
(e) TIME OF GRANTING OPTIONS. The date of grant of an Option
shall, for all purposes, be the date on which the Committee makes the
determination granting such Option, or such other date as is determined by
the Board. Notice of the determination shall be given to each Employee or
Consultant to whom an Option is so granted within a reasonable time after the
date of such grant.
SECTION 6. TERM OF PLAN
The Plan shall become effective on the date of its adoption by the
Board subject to its approval by the shareholders of the Company as described
in Section 17 of the Plan. In the event that the shareholders fail to approve
the Plan within twelve (12) months after its adoption by the
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Board, any Options or Stock Purchase Rights granted during such period shall
be null and void. The Plan shall continue in effect for a term of ten (10)
years unless sooner terminated under Section 14 of the Plan.
SECTION 7. TERM OF OPTION
The term of each Option shall be the term stated in the Optionee's
option agreement; provided however, the term shall be no more than ten (10)
years from the date of. grant thereof or such shorter term as may be provided
in the option agreement. However, in the case of an Option granted to an
Optionee who, at the time the 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 Subsidiary, the term of the Option shall be five (5) years
from the date of grant thereof or such shorter term as may be provided in the
option agreement.
SECTION 8. EXERCISE PRICE AND CONSIDERATION
(a) BOARD DETERMINATION. With respect to each Option, the per
share exercise price for the Shares shall be determined by the Board.
(b) INCENTIVE STOCK OPTIONS. In the case of an Incentive Stock
Option, the exercise price per Share shall be not less than 100% of the Fair
Market Value of such Share on the date of grant. Notwithstanding the above,
if an Incentive Stock Option is granted to an Employee who owns more than ten
percent of the voting power of all classes of stock of the Company or
Subsidiary, the exercise price per Share shall be not less than 110% of the
Fair Market Value of such Share on the date of grant.
(c) NONSTATUTORY STOCK OPTIONS. The exercise price per Share of a
Nonstatutory Stock Option shall not be less than 85% of the Fair Market Value
of such Share on the date of grant.
(d) CONSIDERATION. The consideration to be paid for Shares issued
upon the exercise of an Option and the method of payment for such Shares
shall be determined by .the Committee and, in the case of an Incentive Stock
Option, shall be determined at the time of grant. The consideration to
purchase Shares may consist of, cash, check, recourse or nonrecourse
promissory note, the surrender of other Shares, or any combination of the
foregoing methods of payment. In the case where the exercise price is paid by
the surrender of Shares, the Shares surrendered must (i) have been owned by
the Optionee for more than six months on the date of surrender or were not
acquired, directly or indirectly, from the Company, and (ii) have a Fair
Market Value on the date of surrender equal to the aggregate exercise price
of the new Shares to be acquired.
SECTION 9. EXERCISE OF OPTION
(a) PROCEDURE FOR EXERCISE. Any Option granted hereunder shall be
exercisable at such times and under such conditions as determined by the
Board and as 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 and full payment for the Shares
with respect to which
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the Option is exercised has been received by the Company. Until the issuance
of the stock certificate evidencing such Shares, no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to
the Optioned Stock, 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 13
of the Plan.
(b) TERMINATION OF EMPLOYMENT. In the event of termination of an
Optionee's consulting relationship or Continuous Status as an Employee with
the Company, such Optionee may within ninety (90) days after the date of such
termination (or such other period as set forth in the Option Agreement, but
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 that
Optionee was entitled to exercise it at the date of such termination. To the
extent that Optionee was not entitled to exercise the Option at the date of
such termination, or if Optionee does not exercise such Option to the extent
so entitled within the time specified herein, the Option shall terminate.
(c) DISABILITY OF OPTIONEE. Notwithstanding the provisions of
Section 9(b) above, if an Optionee's Consulting relationship or Continuous
Status as an Employee is terminated as a result of disability (as determined
by the Board in accordance with the policies of the Company), Optionee may
within six (6) months from the date of such termination (or such other longer
period as set forth in the Option Agreement, but 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 Optionee was not
entitled to exercise the Option at the date of termination, or if Optionee
does not exercise such Option to the extent so entitled within the time
specified herein, the Option shall terminate.
(d) DEATH OF OPTIONEE. In the event of the death of an Optionee,
the Option may be exercised within twelve (12) months following the date of
death, (but in no event later than the expiration date of 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 the Optionee was entitled to exercise the
Option at the date of death. To the extent that Optionee was not entitled to
exercise the Option at the date of termination, or if Optionee does not
exercise such Option to the extent so entitled within the time specified
herein, the Option shall terminate.
(e) RULE 16B-3. Options granted to persons subject to Section
16(b) of the Exchange Act must comply with 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.
SECTION 10. RIGHT OF FIRST REFUSAL
(a) RIGHT OF FIRST REFUSAL. Unless the Committee determines
otherwise, all Shares acquired under the Plan by an Optionee or Purchaser
(both being referred to herein as "Holder") shall be subject to the right of
first refusal set forth in this Section 10. Before any Shares may be sold or
transferred (including transfer by operation of law other than as excepted
pursuant to Section 10(e) hereof), Holder must first obtain the written
consent of the Company. If such written consent is not given, then the
Company shall have a right of first refusal to purchase all,
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but not less than all, of the Shares for the same price and, to the extent
practicable, on substantially the same terms and conditions offered to such
prospective purchaser, in accordance with the procedures set forth below.
(b) PURCHASE PRICE. If the proposed price per share is to be
other than in cash, then an equivalent cash value shall be determined in good
faith by the Board. If a transfer other than a voluntary sale is proposed to
be made, then the price per Share for purposes of the right of first refusal
shall be determined by the mutual agreement of Holder and the Company or, if
no agreement can be reached, the price shall be the fair market value of such
shares, as determined in good faith by the Board.
(c) OFFER NOTICE. Prior to any sale or transfer of any Shares,
Holder, or the legal representative of Holder, shall promptly deliver to the
Secretary of the Company a written notice of the price and other terms and
conditions of the offer by the prospective purchaser, the identity of the
prospective purchaser, and, in the case of a sale, Holder's bona fide
intention to sell or dispose of such shares together with a copy of a written
agreement between Holder and the prospective purchaser conditioned only upon
the satisfaction of the procedures set forth in this right of first refusal.
If the Company does not give its written consent to such transfer, then the
Company (or its assignees) shall, for thirty (30) days after such notice from
Holder, have the right under this Section 10 to purchase all such Shares, as
set forth herein.
(d) HOLDER'S RIGHT TO TRANSFER. After the expiration of the
Rights of First Refusal, or upon the written consent of the Company to the
proposed transfer, Holder may sell or transfer the Shares specified in the
notice to the Company, on the terms and conditions specified in such notice;
provided, however, that the sale must be consummated within three (3) months
after the date of the notice and that all Shares sold or transferred shall
remain subject to the applicable provisions and restrictions of this Plan,
including restrictions on further transfer as provided in this Section 10,
and shall carry a legend to that effect. If the right of first refusal under
this Section 10 are not exercised, but Holder fails to consummate such sale
on the same terms and conditions as set forth in the notice to the Company
within three (3) months after the date of the notice, then such right of
first refusal shall be reinstated.
(e) TERMINATION; EXCEPTIONS. The provisions of this Section 10
shall terminate on the closing date of an underwritten public offering of
Common Stock of the Company. The provisions of Section 10(a) shall not apply
to a transfer of any Shares by Holder, either during his or her lifetime or
on death to his or her ancestors, descendants or spouse, or any custodian or
trustee for the account of Holder or Holder's ancestors, descendants or
spouse; provided, in each such case a transferee shall receive and hold such
Shares subject to the provisions and restrictions on transfer under this
Section 10 and there shall be no further transfer of such Shares except in
accordance herewith.
(f) EFFECT OF TRANSFERS NOT IN COMPLIANCE. The Company shall not
be required to transfer on its books any Shares which shall have been sold or
transferred in violation of any of the provisions set forth in this Section
10, or to treat as owner of such Shares, or to accord the right to vote as
such owner or to pay dividends to, any transferee to whom such Shares shall
have been so transferred.
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SECTION 11. STOCK PURCHASE RIGHTS AND REPURCHASE OPTION
(a) RIGHTS TO PURCHASE RESTRICTED STOCK. Stock Purchase Rights
may be issued either alone, in addition to, or in tandem with other awards
granted under the Plan and/or cash awards made outside of the Plan. After the
Committee determines that it will offer Stock Purchase Rights under the Plan,
it shall advise the offeree in writing of the terms, conditions and
restrictions related to the offer, including the number of Shares that such
person shall be entitled to purchase, the price to be paid, and the time
within which such person must accept such offer, which shall in no event
exceed one-hundred eighty (180) days from the date of grant of the Stock
Purchase Right. The offer shall be accepted by execution of a stock purchase
agreement in the form determined by the Committee.
(b) REPURCHASE OPTION. Unless the Committee 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).
The purchase price for unvested Shares repurchased pursuant to the stock
purchase agreement shall be the original price paid by the Purchaser and may
be paid by cancellation of any indebtedness of the purchaser to the Company.
The repurchase option with respect to the Restricted Stock shall lapse at
such rate as the Committee may determine.
(c) 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 Committee in its sole discretion. In addition, the
provisions of stock purchase agreements need not be the same with respect to
each Purchaser.
(d) RIGHTS AS A SHAREHOLDER. Once the Stock Purchase Right is
exercised, the Purchaser shall have the rights equivalent to those of a
shareholder, and shall be a shareholder when his or her purchase is entered
upon the records of the duly authorized transfer agent of the Company. No
adjustment will be made for a dividend or other right for which the record
date is prior to the date the Stock Purchase Right is exercised, except as
provided in Section 13 of the Plan.
SECTION 12. WITHHOLDING TAXES
(a) OBLIGATION OF OPTIONEES AND PURCHASERS. As a condition to the
exercise of an Option or Stock Purchase Right, the Optionees and Purchasers
shall make such arrangements as the Committee may require to the satisfaction
of any federal, state, local or foreign withholding tax obligations that may
arise in connection with exercise. The Optionees shall also make such
arrangements as the Committee may require for the satisfaction of any
federal, state, local or foreign withholding tax obligations that may arise
in connection with the disposition of Shares acquired by exercising an Option.
(b) STOCK WITHHOLDING TO SATISFY WITHHOLDING TAX OBLIGATIONS. At
the discretion of the Committee, Optionees or Purchasers may satisfy
withholding obligations as provided in this paragraph. When an Optionee or
Purchaser incurs a tax liability in connection with an Option or Stock
Purchase Right, which tax liability is subject to tax withholding under
applicable tax laws, and the Optionee or Purchaser is obligated to pay the
Company an amount required to
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be withheld under applicable tax laws, the Optionee or Purchaser may satisfy
the withholding tax obligation by electing to have the Company withhold from
the Shares to be issued upon exercise of the Option, or the Shares to be
issued in connection with the Stock Purchase Right, if any, that number of
Shares having a Fair Market Value equal to the amount required to be
withheld. The Fair Market Value of the Shares to be withheld shall be
determined on the date that the amount of tax to be withheld is to be
determined (the "Tax Date").
All elections by an Optionee or Purchaser to have Shares withheld for
this purpose shall be made in writing in a form acceptable to the Committee
and shall be subject to the following restrictions:
(i) the election must be made on or prior to the Tax Date;
(ii) once made, the election shall be irrevocable as to the
particular Shares of the Option or Stock Purchase Right as to which the
election is made;
(iii) all elections shall be subject to the consent or
disapproval of the Committee;
(iv) if the Optionee is subject to Rule 16b-3 of the Exchange
Act, the election must comply with the applicable provisions of Rule 16b-3
and shall be subject to 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.
In the event the election to have Shares withheld is made by an Optionee or
Purchaser and no election is filed under Section 83(b) of the Code, the
Optionee or Purchaser shall receive the full number of Shares with respect to
which the Option or Stock Purchase Right is exercised, but such Optionee or
Purchaser shall be unconditionally obligated to tender back to the Company
the proper number of Shares at the time when the amount of withholding tax
becomes due and payable.
SECTION 13. ADJUSTMENT OF SHARES
(a) CHANGES IN CAPITALIZATION OR MERGER. Subject to any required
action by the shareholders of the Company, the number of Shares covered by
each outstanding Option or Stock Purchase Right, and the number of Shares
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 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 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 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
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respect to, the number, or price of Shares subject to an Option or Stock
Purchase Right. In the event of a merger of the Company with or into another
corporation, the Option shall be assumed or an equivalent option shall be
substituted by such successor corporation or a parent or subsidiary of such
successor corporation.
(b) DISSOLUTION, LIQUIDATION OR OTHER MERGER. In the event of the
proposed dissolution or liquidation of the Company, or of a merger in which
the successor corporation does not agree to assume the Option or Stock
Purchase Right or substitute an equivalent Option or Stock Purchase Right,
the Board shall notify Optionees and Purchasers at least thirty (30) days
prior to such proposed action. To the extent it has not been previously
exercised, the Option or Stock Purchase Right will terminate immediately
prior to the consummation of such proposed action.
SECTION 14. AMENDMENT AND TERMINATION OF PLAN
(a) AMENDMENT AND TERMINATION. The Board may at any time amend,
alter, suspend or discontinue the Plan, but no amendment, alteration,
suspension or discontinuation shall be made which would impair the rights of
any Optionee or Purchaser under any grant theretofore made, without his or
her consent. In addition, to the extent necessary and desirable to comply
with Rule 16b-3 under the Exchange Act or with Section 422 of the Code (or
any other applicable law or regulation, including the requirements of the
NASD or an established stock exchange), the Company shall obtain shareholder
approval of any Plan amendment in such a manner and to such a degree as
required.
(b) EFFECT OF AMENDMENT OR TERMINATION. Any such amendment or
termination of the Plan shall not affect Options and Stock Purchase Rights
already granted and such Options and Stock Purchase Rights shall remain in
full force and effect as if this Plan had not been amended or terminated,
unless mutually agreed otherwise between the Optionee or Purchaser and the
Board, which agreement must be in writing and signed by the Optionee or
Purchaser and the Company.
SECTION 15. ISSUANCE OF SHARES
(a) LEGAL REQUIREMENTS. 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 such 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, 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.
(b) INVESTMENT REPRESENTATIONS. As a condition to the exercise of
an Option or Stock Purchase Right, the Committee 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.
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(c) REGULATORY APPROVAL. 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.
SECTION 16. NO EMPLOYMENT RIGHTS
No provision of the Plan, nor any Option or Stock Purchase Right
granted under the Plan shall confer upon any Optionee or Purchaser any right
with respect to continuation of employment or consulting relationship with
the Company, nor shall it interfere in any way with his right or the
Company's right to terminate his employment or consulting relationship at any
time, with or without cause.
SECTION 17. SHAREHOLDER APPROVAL
Continuance of the Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months before or after the
date the Plan is adopted. Such shareholder approval shall be obtained in the
degree and manner required under applicable state and federal law.
SECTION 18. INFORMATION TO OPTIONEES
The Company shall provide to each Optionee, during the period for which
such Optionee has one or more Options outstanding, annual financial
statements of the Company. The Company shall not be required to provide such
information if the issuance of Options under the Plan is limited to key
employees whose duties in connection with the Company assure their access to
equivalent information.
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