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EXHIBIT 10.1
PRAECIS PHARMACEUTICALS INCORPORATED
SECOND AMENDED AND RESTATED 1995 STOCK PLAN
1. PURPOSE. This Second Amended and Restated 1995 Stock Plan
(the "Plan") is intended to benefit and provide incentives:
(a) to the employees of PRAECIS PHARMACEUTICALS INCORPORATED (the
"Company"), its parent (if any) and any present or future
subsidiaries of the Company (collectively, "Related
Corporations"), by providing them with opportunities to
purchase stock in the Company pursuant to options granted
hereunder which qualify as "incentive stock options" ("ISO" or
"ISOs") under Section 422(b) of the Internal Revenue Code of
1986, as amended (the "Code");
(b) to employees, directors and consultants of the Company and
Related Corporations by providing them with opportunities to
purchase stock in the Company pursuant to options granted
hereunder which do not qualify as ISOs ("Non-Qualified Option"
or "Non-Qualified Options"); and
(c) to employees, directors and consultants of the Company and
Related Corporations by providing them with awards, or
opportunities to make direct purchases, of stock in the
Company ("Awards").
Both ISOs and Non-Qualified Options are referred to
hereinafter individually as an "Option" and collectively as "Options." Options
and Awards are referred to hereinafter collectively as "Stock Rights." As used
herein, the terms "parent" and "subsidiary" mean "parent corporation" and
"subsidiary corporation," respectively, as those terms are defined in Section
424 of the Code.
2. ADMINISTRATION OF THE PLAN.
A. BOARD OR COMMITTEE ADMINISTRATION. The Plan shall be
administered by a Committee of not less than two (2)
persons, each of whom shall be a "Non-Employee
Director" within the meaning of Rule 16b-3(b)(3)(i)
promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act") and an "outside
director" within
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the meaning of Section 162(m) of the Code. The
members of the Committee shall be appointed by the
Company's Board of Directors (the "Board") and shall
serve at the pleasure of the Board. If no Committee
has been appointed to administer the Plan, the
functions of the Committee specified in the Plan
shall be carried out by the Board, except that at any
time after a registration of any of the Company's
stock under the Exchange Act or the Company
otherwise becomes subject to the reporting
requirements of the Exchange Act, administration by a
Committee is required. Subject to the terms of the
Plan, the Committee shall have the authority to:
(i) determine the employees of the Company
and Related Corporations (from among
the class of employees eligible under
paragraph 3 to receive ISOs) to whom
ISOs may be granted, and to determine
(from among the class of individuals
and entities eligible under paragraph 3
to receive Non-Qualified Options and
Awards) to whom Non-Qualified Options
and Awards may be granted;
(ii) determine the time or times at which
Options or Awards may be granted;
(iii) determine the option price of shares
subject to each Option, which price
shall not be less than the minimum
price specified in paragraph 6, and the
purchase price (if any) of shares
subject to each Award;
(iv) determine whether each Option granted
shall be an ISO or a Non-Qualified
Option;
(v) determine (subject to paragraph 7) the
time or times when each Option shall
become exercisable and the duration of
the exercise period;
(vi) determine whether restrictions such as
repurchase rights and other vesting
restrictions are to be imposed on
shares subject to Options and Awards
and the nature of such restrictions, if
any, and
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other terms and conditions of Options
and Awards not inconsistent with the
Plan; and
(vii) interpret the Plan and prescribe and
rescind rules and regulations relating
to it.
If the Committee determines to issue a Non-Qualified
Option, it shall designate the Non-Qualified Option as such upon grant
and in the agreement governing such Non-Qualified Option. The
interpretation and construction by the Committee of any provisions of
the Plan or of any Stock Right granted under it shall be final unless
otherwise determined by the Board. The Committee may from time to time
adopt such rules and regulations for carrying out the Plan as it may
deem best. No member of the Board or the Committee shall be liable for
any action or determination made in good faith with respect to the Plan
or any Stock Right granted under the Plan.
B. COMMITTEE ACTIONS. The Committee may select one
of its members as its chairman, and shall hold
meetings at such time and place as it may deter
mine. Acts by a majority of the Committee, or
acts reduced to or approved in writing by a
majority of the members of the Committee, shall
be the valid acts of the Committee. All references
in this Plan to the Committee shall mean the Board
if no Committee has been appointed.
3. ELIGIBLE EMPLOYEES AND OTHERS. ISOs may be granted to any
employee (including an employee who serves as an officer
or director) of the Company or any Related Corporation.
Non-Qualified Options and Awards may be granted to any
employee (including an employee who serves as an officer
or director), director or consultant (including a consultant
who also serves as a director) of the Company or any
Related Corporation. The Committee may take into
consideration a recipient's individual circumstances in
determining whether to grant a Stock Right. No participant
in the Plan shall be granted Stock Rights which in
the aggregate exceed 50% of the total number of shares of
common stock, par value $.01 per share (the "Common
Stock"), of the Company authorized to be issued with
respect to such Stock Rights pursuant to the Plan. The
granting of any Stock Right to any individual or entity
shall neither entitle that individual or entity to, nor
disqualify him from, participation in any other grant of
Stock Rights.
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4. STOCK. The stock subject to Options and Awards shall be
authorized but unissued shares of Common Stock or shares
of Common Stock reacquired by the Company in any manner.
The aggregate number of shares which may be issued pursuant
to the Plan is 11,375,000, subject to adjustment as
provided in paragraph 13. Any such shares may be issued
pursuant to ISOs, Non-Qualified Options or Awards, so long
as the number of shares so issued does not exceed such
number, as adjusted. If any Option granted under the Plan
shall expire or terminate for any reason without having
been exercised in full or shall cease for any reason to be
exercisable in whole or in part, or if the Company shall
reacquire any unvested shares issued pursuant to Awards,
the unpurchased shares subject to such Options and any
unvested shares so reacquired by the Company shall again
be available for grants of Stock Rights under the Plan.
5. GRANTING OF STOCK RIGHTS. Stock Rights may be granted
under the Plan at any time on or after January 5, 1995 and
prior to the close of business on January 5, 2005. The
date of grant of a Stock Right under the Plan will be the
date specified by the Committee at the time it grants the
Stock Right; provided, however, that such date shall not
be prior to the date on which the Committee acts to approve
the grant. The Committee shall have the right, with
the consent of the optionee, to convert an ISO granted
under the Plan to a Non-Qualified Option pursuant to
paragraph 16.
6. MINIMUM OPTION PRICE; ISO LIMITATIONS.
A. EXERCISE PRICE FOR NON-QUALIFIED OPTIONS. The
exercise price per share specified in the agreement
relating to each Non-Qualified Option granted under
the Plan shall in no event be less than the par value
per share of Common Stock as of the date of grant.
B. EXERCISE PRICE FOR ISOs. The exercise price per
share of Common Stock specified in the agreement
relating to each ISO granted under the Plan
shall not be less than the fair market value per
share of Common Stock on the date of such grant.
In the case of an ISO to be granted to an employee
owning stock possessing more than ten percent (10%)
of the total combined voting power of all classes of
stock of the Company or any Related Corporation, the
price per share specified in the agreement relating
to such ISO shall
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not be less than one hundred ten percent (110%) of
the fair market value per share of Common Stock on
the date of such grant.
C. $100,000 ANNUAL LIMITATION ON ISOs. Each eligible
employee may be granted ISOs only to the
extent that, in the aggregate under this Plan
and all incentive stock option plans of the
Company and any Related Corporation, such ISOs
do not become exercisable for the first time by
such employee during any calendar year in a
manner which would entitle the employee to purchase
more than $100,000 in fair market value (determined
at the time the ISOs were granted) of Common Stock
in that year. Any options granted to an employee in
excess of such amount will be granted as
Non-Qualified Options.
D. DETERMINATION OF FAIR MARKET VALUE. If, at the
time an Option is granted under the Plan, the
Company's Common Stock is publicly traded, "fair
market value" shall be determined as of the last
business day for which the prices or quotes
referred to in this sentence are available prior
to the date such Option is granted and shall
mean (i) the average (on that date) of the high
and low prices of the Common Stock on the principal
national securities exchange on which the
Common Stock is traded, if the Common Stock is
then traded on a national securities exchange;
or (ii) the last reported sale price (on that
date) of the Common Stock on the Nasdaq National
Market, if the Common Stock is not then traded
on a national securities exchange; or (iii) the
closing bid price (or average bid prices) last
quoted (on that date) by an established quotation
service for over-the-counter securities, if
the Common Stock is not then listed on the
Nasdaq National Market. However, if the Common
Stock is not publicly traded at the time an
Option is granted under the Plan, "fair market
value" shall be deemed to be the fair value of
the Common Stock as determined by the Committee
after taking into consideration all factors
which it deems appropriate, including, without
limitation, recent sale and offer prices of the
Common Stock in private transactions negotiated
at arm's length.
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7. OPTION DURATION. Subject to earlier termination as provided in
paragraphs 9 and 10, each Option shall expire on the date specified by
the Committee, but not more than (i) ten years from the date of grant
in the case of ISOs generally (to the extent such Option is intended to
be an ISO), and (ii) five years from the date of grant in the case of
ISOs granted to an employee owning stock possessing more than ten
percent (10%) of the total combined voting power of all classes of
stock of the Company or any Related Corporation. Subject to earlier
termination as provided in paragraphs 9 and 10, the term of each ISO
shall be the term set forth in the original instrument granting such
ISO, except with respect to any part of such ISO that is converted into
a Non-Qualified Option pursuant to paragraph 16.
8. EXERCISE OF OPTION. Subject to the provisions of paragraphs 9 through
12, each Option granted under the Plan shall be exercisable as follows:
A. VESTING. The Option (or any portion thereof)
shall be fully exercisable on the date of grant
or shall become exercisable thereafter in such
installments as the Committee may specify.
B. FULL VESTING OF INSTALLMENTS. Once an installment
becomes exercisable, it shall remain exercisable
until expiration or termination of the Option,
unless otherwise specified by the Committee.
C. PARTIAL EXERCISE. Each Option or installment
may be exercised at any time or from time to
time, in whole or in part, for up to the total
number of shares with respect to which it is
then exercisable.
D. ACCELERATION OF VESTING. The Committee shall have the
right to accelerate the date of exercise of any
installment of any Option; provided, that the
Committee shall not, without the consent of an
optionee, accelerate the exercise date of any
installment of any Option granted to any employee as
an ISO (and not previously converted into a
Non-Qualified Option pursuant to paragraph 16) if
such acceleration would violate the annual vesting
limitation contained in Section 422(d) of the Code,
as described in paragraph 6(C).
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9. TERMINATION OF EMPLOYMENT. If an ISO optionee ceases to be employed by
the Company and all Related Corporations, except as provided in
paragraph 10, no further installments of his ISOs shall become
exercisable (unless other wise approved by the Committee), and his ISOs
which are exercisable on the date of termination of his employment
shall terminate after the passage of three months from the date of
termination of his employment, but in no event later than on their
specified expiration dates, except (i) in the case of termination for
"Misconduct," as defined in the instrument granting such ISOs, in which
case such ISOs shall terminate automatically on the date of such
termination, and (ii) to the extent that such ISOs (or unexercised
installments thereof) have been converted into Non-Qualified Options
pursuant to paragraph 16. Employment shall be considered as continuing
uninterrupted during any bona fide leave of absence (such as those
attributable to illness, military obligations or governmental service);
provided, that the period of such leave does not exceed three months
or, if longer, any period during which such optionee's right to
reemployment is guaranteed by statute. A bona fide leave of absence
with the written approval of the Committee shall not be considered an
interruption of employment under the Plan, provided, that such written
approval contractually obligates the Company or any Related Corporation
to continue the employment of the optionee after the approved period of
absence. ISOs granted under the Plan shall not be affected by any
change of employment within or among the Company and Related
Corporations, so long as the optionee continues to be an employee of
the Company or any Related Corporation. Nothing in the Plan shall be
deemed to give any grantee of any Stock Right the right to be retained
in employment or other service by the Company or any Related
Corporation for any period of time.
10. DEATH; DISABILITY.
A. DEATH. If an ISO optionee ceases to be employed by
the Company and all Related Corporations by reason of
his death, any ISO of his may be exercised, to the
extent of the number of shares with respect to which
he could have exercised it on the date of his death,
by his estate, personal representative or beneficiary
who has acquired the ISO by will or by the laws of
descent and distribution, at any time prior to the
earlier of the specified expiration date of the ISO
or 180 days from the date of the optionee's
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death or such longer period not in excess of one
year as the Committee shall determine.
B. DISABILITY. If an ISO optionee ceases to be employed
by the Company and all Related Corporations by reason
of his disability, he shall have the right to
exercise any ISO held by him on the date of
termination of employment, to the extent of the
number of shares with respect to which he could have
exercised it on that date, at any time prior to the
earlier of the specified expiration date of the ISO
or 180 days from the date of the termination of the
optionee's employment or such longer period not in
excess of one year as the Committee shall determine.
For the purposes of the Plan, the term "disability"
shall mean "permanent and total disability" as
defined in Section 22(e)(3) of the Code or successor
statute.
11. ASSIGNABILITY. No Option shall be assignable or transferable by the
optionee except by will or by the laws of descent and distribution or,
in the sole discretion of the Committee at the time of the proposed
assignment or transfer, pursuant to a qualified domestic relations
order as defined under the Code or Title I of the Employee Retirement
Income Security Act (or the rules thereunder), or as the Committee, in
its sole discretion, shall otherwise permit. The Option shall be
exercisable during the lifetime of the optionee only by such optionee
or his guardian or legal representative, or by an assignee or
transferee if the Option has been assigned or transferred in compliance
with the immediately preceding sentence. Notwithstanding the
foregoing, to the extent the instrument evidencing any Non-Qualified
Option so provides, and subject to the conditions that the Committee
may prescribe, an optionee may, upon providing written notice to the
President of the Company, elect to transfer the Options granted to such
optionee pursuant to such instrument, without consideration therefor.
The terms of such Option shall be binding upon any recipient of such
Option.
12. TERMS AND CONDITIONS OF OPTIONS. Options shall be evidenced by
instruments (which need not be identical) in such forms as the
Committee may from time to time approve. Such instruments shall conform
to the terms and conditions set forth in paragraphs 6 through 11 hereof
and may contain such other provisions as the Committee deems advisable
which are not inconsistent with the Plan, including restrictions
applicable to shares of Common Stock issuable
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upon exercise of Options (including, without limitation, rights of
repurchase by the Company and, in the event of an underwritten public
offering of the Company's securities, restrictions on any sale or
distribution by the optionee of any of the Company's common equity for
a period of time as the underwriters in such public offering shall
determine). In granting any Non-Qualified Option, the Committee may
specify that such Non-Qualified Option shall be subject to the
restrictions set forth herein with respect to ISOs, or to such other
termination, cancellation and other provisions not inconsistent with
the Plan as the Committee may determine. The Committee may from time to
time confer authority and responsibility on one or more of its own
members or one or more officers of the Company to execute and deliver
such instruments. The proper officers of the Company are authorized and
directed to take any and all action necessary or advisable from time to
time to carry out the terms of such instruments.
13. ADJUSTMENTS. Upon the occurrence of any of the following events, an
optionee's rights with respect to Options granted to him hereunder
shall be adjusted as and to the extent hereinafter required, unless
otherwise specifically provided in the written agreement between the
optionee and the Company relating to such Option:
A. STOCK DIVIDENDS AND STOCK SPLITS. If the shares
of Common Stock shall be subdivided or combined
into a greater or smaller number of shares or if
the Company shall issue any shares of Common
Stock as a stock dividend on its outstanding
Common Stock, the number of shares of Common
Stock deliverable upon the exercise of Options
shall be appropriately increased or decreased
proportionately and appropriate adjustments
shall be made in the purchase price per share to
reflect such subdivision, combination or stock
dividend.
B. CONSOLIDATIONS OR MERGERS. If the Company is to be
consolidated with or acquired by another entity in a
merger, sale of all or substantially all of the
Company's assets or otherwise (an "Acquisition"), the
committee or the board of directors of any entity
assuming the obligations of the Company hereunder
(the "Successor Board"), shall, as to outstanding
Options, either (i) make appropriate provision for
the continuation of such Options by substitution on
an equitable basis for the shares then subject
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to such Options the consideration payable with
respect to the outstanding shares of Common Stock in
connection with the Acquisition; (ii) upon written
notice to the optionees, provide that all Options
must be exercised, to the extent then exercisable
(or in the discretion of the Committee or the
Successor Board, also provide that all unvested
Options shall be, or become at the time which the
Committee shall determine, immediately exercisable),
within a specified number of days of the date of such
notice, at the end of which period the Options shall
terminate; or (iii) terminate all Options in exchange
for a cash payment or other consideration equal to
the excess of the fair market value of the shares
subject to such Options (to the extent then
exercisable, or in the discretion of the Committee or
the Successor Board, whether or not then exercisable)
over the exercise price thereof.
C. RECAPITALIZATION OR REORGANIZATION. In the event of a
recapitalization or reorganization of the Company
(other than a transaction described in subparagraph B
above) pursuant to which securities of the Company or
of another corporation are issued with respect to the
outstanding shares of Common Stock, an optionee upon
exercising an Option shall be entitled to receive for
the purchase price paid upon such exercise, the
securities he would have received if he had exercised
his Option immediately prior to such recapitalization
or reorganization.
D. MODIFICATION OF ISOs. Notwithstanding the foregoing,
any adjustments made pursuant to subparagraphs A, B
or C with respect to ISOs shall be made only after
the Committee, after consulting with counsel for the
Company, determines whether such adjustments would
constitute a "modification" of such ISOs (as that
term is defined in Section 424 of the Code) or would
cause any adverse tax consequences for the holders of
such ISOs. If the Committee determines that such
adjustments made with respect to ISOs would
constitute a modification of such ISOs, it may
refrain from making such adjustments.
E. DISSOLUTION OR LIQUIDATION. In the event of the
proposed dissolution or liquidation of the Com-
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pany, each Option will terminate immediately prior to
the consummation of such proposed action or at such
other time and subject to such other conditions as
shall be determined by the Committee.
F. ISSUANCES OF SECURITIES. 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 subject to
Options. No adjustments shall be made for dividends
paid in cash or in property other than securities of
the Company.
G. FRACTIONAL SHARES. No fractional shares shall
be issued under the Plan and the optionee shall
receive from the Company cash in lieu of such
fractional shares.
H. ADJUSTMENTS. Upon the happening of any of the events
described in subparagraphs A, B or C above, the class
and aggregate number of shares set forth in paragraph
4 hereof that are subject to Stock Rights which
previously have been or subsequently may be granted
under the Plan shall also be appropriately adjusted
to reflect the events described in such
subparagraphs. If changes in the capitalization of
the Company shall occur other than those referred to
above in this Paragraph 13, the Committee shall make
such adjustments, if any, in the number of shares
covered by each Option and in the per share purchase
price as the Committee in its discretion may consider
appropriate. The Committee or, if applicable, the
Successor Board, shall determine the specific
adjustments to be made under this paragraph 13 and
its determination shall be conclusive.
If any person or entity owning restricted Common Stock
obtained by exercise of a Stock Right made hereunder receives shares or
securities or cash in connection with a corporate transaction described in
subparagraphs A, B or C above as a result of owning such restricted Common
Stock, such shares or securities or cash shall be subject to all of the
conditions and restrictions applicable to the restricted Common Stock with
respect to which such shares or securities or cash
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were issued, unless otherwise determined by the Committee or the Successor
Board.
14. MEANS OF EXERCISING OPTIONS. An Option (or any part or installment
thereof) shall be exercised by giving written notice to the Company at
its principal executive office or to the transfer agent as the Company
shall designate. Such notice shall identify the Option being exercised
and specify the number of shares as to which such Option is being
exercised, accompanied by full payment of the purchase price therefor
(a) in United States dollars in cash or by check, (b) at the discretion
of the Committee, by delivery of shares of Common Stock (the value of
which for this purpose shall be determined by the Committee), (c) at
the discretion of the Committee, by delivery of the grantee's personal
recourse note bearing interest payable not less than annually at no
less than 100% of the lowest applicable Federal rate, as defined in
Section 1274(d) of the Code or (d) subject to clauses (b) and (c), by
any combination of (a), (b) or (c) above. In connection with any
payment pursuant to clause (c) above, the Committee may require the
optionee to concurrently execute and deliver to the Company a pledge
agreement in a form reasonably satisfactory to the Company, together
with a stock certificate or certificates representing shares of the
Company's Common Stock (having an aggregate fair market value, as
determined by the Committee), equal as of the date of exercise to at
least the value of the principal amount of the note), duly endorsed or
accompanied by a stock power or powers duly endorsed, to secure the
optionee's obligations under such personal recourse note. The holder of
an Option shall not have the rights of a shareholder with respect to
the shares covered by his Option until the date of issuance of a stock
certificate to him for such shares. Except as expressly provided above
in paragraph 13 with respect to changes in capitalization and stock
dividends, no adjustment shall be made for dividends or similar rights
for which the record date is before the date such stock certificate is
issued.
15. TERM AND AMENDMENT OF PLAN. The Company's 1995 Stock Plan
was originally adopted on January 5, 1995. The Plan as
currently in effect was adopted by the Board on February 2, 2000,
approved by the stockholders of the Company on February 28, 2000,
and shall be effective automatically upon consummation of the
Company's initial public offering. The Plan shall expire at the end
of the day on January 5, 2005 (except as to Stock Rights outstanding
on that date). The Board may terminate or amend the Plan in any
respect at any time; provided, that no such amendment or termination
shall adversely affect any Plan participant's rights under
any Stock Right previously granted, without such participant's written
consent. If the scope of any amendment is
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such as to require stockholder approval in order to comply with Section
162(m) of the Code or any other law, regulation or stock exchange
requirement, then such amendment shall not be effective unless and
until such stockholder approval is obtained.
16. CONVERSION OF ISOs INTO NON-QUALIFIED OPTIONS; TERMINATION OF ISOs. The
Committee, at the written request of any optionee, may in its
discretion, take such actions as may be necessary to convert such
optionee's ISOs (or any installments or portions of installments
thereof) that have not been exercised on the date of conversion into
Non-Qualified Options at any time prior to the expiration of such ISOs,
regardless of whether the optionee is an employee of the Company or a
Related Corporation at the time of such conversion. Such actions may
include, but not be limited to, extending the exercise period or
reducing the exercise price of the appropriate installments of such
ISOs. At the time of such conversion, the Committee (with the consent
of the optionee) may impose such conditions on the exercise of the
resulting Non-Qualified Options as the Committee in its discretion may
determine; provided, that such conditions shall not be inconsistent
with this Plan. Nothing in the Plan shall be deemed to give any
optionee the right to have such optionee's ISOs converted into
Non-Qualified Options, and no such conversion shall occur until and
unless the Committee takes appropriate action. The Committee, with the
consent of the optionee, may also terminate any portion of any ISO that
has not been exercised at the time of such conversion.
17. GOVERNMENTAL REGULATION. The Company's obligation to sell and deliver
shares of the Common Stock under this Plan is subject to the approval
of any governmental authority required in connection with the
authorization, issuance or sale of such shares.
18. TAX WITHHOLDING. Upon the exercise of a Non-Qualified Option, the grant
of an Award or the making of a purchase of Common Stock for less than
its fair market value pursuant to an Award, the making of a
Disqualifying Disposition (as defined in paragraph 19) or the vesting
of Restricted Stock (as defined in paragraph 20), the Company, in
accordance with Section 3402(a) of the Code, may require the optionee
or Award recipient to pay withholding taxes in respect of the amount
that is considered compensation required to be included in such
person's gross income. The Committee, in its discretion, may condition
(i) the exercise of an Option, (ii) the grant of an Award, (iii)
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the making of a purchase of Common Stock for less than its fair market
value pursuant to an Award or (iv) the vesting of Restricted Stock on
the grantee's payment of such withholding taxes. The Committee shall
have the sole discretion to determine the form in which payment of such
withholding taxes will be made (I.E., cash, securities or a combination
thereof).
19. NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION. Each
employee who receives an ISO must agree to notify the
Company in writing immediately after the employee makes a
Disqualifying Disposition of any Common Stock acquired
pursuant to the exercise of an ISO. A Disqualifying
Disposition is any disposition (including any sale) of
such Common Stock before the later of (a) two years after
the date the employee was granted the ISO or (b) one year
after the date the employee acquired Common Stock by
exercising the ISO. If the employee has died before such
stock is sold, these holding period requirements do not
apply and no Disqualifying Disposition can occur thereafter.
20. PROVISIONS RELATED TO RESTRICTED STOCK AND OTHER AWARDS.
A. Awards of shares of Common Stock may be granted
either alone, in addition to or in tandem with other
awards granted under the Plan or cash awards made
outside the Plan, and such shares may be subject to
repurchase by the Company upon such terms and
conditions as the Committee may determine (such
shares subject to such repurchase being referred to
as "Restricted Stock"). The Committee shall determine
the eligible persons to whom, and the time or times
at which, Awards will be made, the number of shares
to be awarded, the price (if any) to be paid by the
Award recipient, in the case of Restricted Stock, the
time or times within which such shares of Restricted
Stock may be subject to forfeiture and all other
terms and conditions of any such Award. The Committee
may condition an Award or the vesting of Restricted
Stock upon the attainment of specified performance
goals or such other factors as the Committee may
determine in its sole discretion. The terms and
conditions of Awards need not be the same for each
recipient.
B. The prospective recipient of an Award shall not
have any rights with respect to such Award,
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unless and until such recipient has executed an
agreement evidencing the Award and has delivered a
fully executed copy thereof to the Company, and has
otherwise complied with the applicable terms and
conditions of such Award.
(i) The consideration for shares issued
pursuant to an Award shall be equal to
or greater than their par value.
(ii) Awards must be accepted within a period
of sixty (60) days (or such shorter
period as the Committee may specify at
grant) after the Award date, by
executing an Award agreement and
paying whatever price (if any) is
required under the Award.
(iii) A stock certificate in respect of
shares of Common Stock which are the
subject of an Award shall be issued in
the name of the participant receiving
such Award, and shall bear an
appropriate legend referring to the
terms, conditions and restrictions
applicable to such Award.
(iv) The Committee may require that the
stock certificates evidencing
shares of Restricted Stock be held
in custody by the Company until the
restrictions thereon shall have
lapsed, and that, as a condition of
any Restricted Stock Award, the
participant shall have delivered a
stock power, endorsed in blank,
relating to the shares of
Restricted Stock covered by such
Award.
C. Awards of shares of Restricted Stock under the Plan
shall be subject to the following restrictions and
conditions (in addition to other restrictions and
conditions set forth in the Award agreement with
respect to such shares not inconsistent with this
Plan which the Committee shall determine in its sole
discretion):
(i) Subject to the provisions of the Plan
and the Award agreement, during a
period set by the Committee commencing
with the date of such Award (the
"Restricted
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Period"), the participant shall not be
permitted to sell, transfer, pledge or
assign shares of Restricted Stock
issued pursuant to an Award. The
Committee, in its sole discretion, may
provide for the lapse of such
restrictions in installments and may
accelerate or waive such restrictions
in whole or in part, based on service,
performance or such other factors or
criteria as the Committee may
determine, in its sole discretion. The
Award agreement may contain other
restrictions and conditions not
inconsistent with the Plan as the
Committee shall deem appropriate,
including without limitation, rights
of repurchase by the Company and, in
the event of an underwritten public
offering of the Company's securities,
restrictions on any sale or
distribution by the Award recipient of
any of the Company's common equity for
a period of time as the underwriters
in such public offering shall
determine.
(ii) Except as provided herein, the
recipient shall have, with respect to
shares of Restricted Stock issued
pursuant to an Award, all of the rights
of a stock holder of the Company,
including the right to vote the shares,
and the right to receive any cash
dividends. The Committee may, in its
sole discretion, at the time of the
grant of an Award of Restricted Stock,
permit or require the payment of cash
dividends with respect to such
Restricted Stock to be deferred and, if
the Committee so determines,
reinvested, in additional shares of
Restricted Stock to the extent shares
are available under the Plan, or other
wise reinvested. Stock dividends issued
with respect to Restricted Stock shall
be treated as additional shares of
Restricted Stock that are subject to
the same restrictions and other terms
and conditions that apply to the shares
with respect to which such dividends
are issued.
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(iii) Subject to the applicable provisions of
the Award agreement, if and when the
Restricted Period expires without a
prior forfeiture of the Restricted
Stock subject to such Restricted
Period, certificates for an appropriate
number of unrestricted shares (without
any legend referred to in subparagraph
(iii) of subsection B of Section 20)
shall be delivered to the participant
promptly upon the surrender and
cancellation of the previously issued
certificate(s) representing such
shares.
21. GOVERNING LAW; CONSTRUCTION. The validity and construction of the Plan
and the instruments evidencing Stock Rights shall be governed by the
laws of the Commonwealth of Massachusetts, or the laws of any
jurisdiction in which the Company or its successors in interest may be
organized. In construing this Plan, the singular shall include the
plural and the masculine gender shall include the feminine and neuter,
unless the contest otherwise requires.
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