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EXHIBIT 10.1
INFORMAX, INC.
AMENDED EQUITY INCENTIVE COMPENSATION PLAN
INFORMAX, INC. (the "Company") sets forth herein the terms of this
Equity Incentive Compensation Plan (the "Plan") as follows:
1. PURPOSE
The Plan is intended to advance the interests of the Company by
providing eligible officers, employees, directors of, and consultants to the
Company (as designated pursuant to Section 4 below) with incentives to improve
business results, by providing an opportunity to acquire or increase a
proprietary interest in the Company, which thereby will create a stronger
incentive to expend maximum effort for the growth and success of the Company,
and will encourage such persons to remain in the employ or service of the
Company. To this end, the Plan provides for the grant of stock options, and
shares of restricted stock, all as set out herein.
Each stock option granted under the Plan (an "Option") is intended
to be an "incentive stock option" within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended from time to time, or the
corresponding provision of any subsequently-enacted tax statute (the "Code")
("Incentive Stock Option"), except (i) to the extent that any such Option would
exceed the limitations set forth in Section 7 below; (ii) any Option
specifically designated at the time of grant as not being "incentive stock
options"; and (iii) any Option that otherwise would not satisfy the requirements
of Code Section 422 at the time of grant (collectively, "Non-qualified Stock
Options"). Further, grants may be made of shares of restricted stock, in
accordance with the provisions of Section 6 below ("Restrictive Stock Awards").
Such grants and awards are referred to collectively as "Incentive Awards." Each
Incentive Award shall be evidenced by a written agreement between the Company
and the recipient employee setting out the terms and conditions of the grant (an
"Agreement"). Except where the context otherwise requires, the term "Company"
shall include the parent corporation and all subsidiaries of the Company within
the meaning of Sections 424(e) and 424(f) of the Code.
2. ADMINISTRATION
(a) Board of Directors. The Plan shall be administered
by the Board of Directors of the Company (the "Board"), which shall have the
full power and authority to take all actions, and to make all determinations
required or provided for under the Plan or any Incentive Award granted or
associated agreement entered into hereunder and all such other actions and
determinations not inconsistent with the specific terms and provisions of the
Plan deemed by the
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Board to be necessary or appropriate to the administration of the Plan or any
Incentive Award granted or Agreement entered into hereunder. All such actions
and determinations shall be by the affirmative vote of a majority of the members
of the Board present at a meeting at which any issue relating to the Plan is
properly raised for consideration or by without a meeting by written consent of
the Board of Directors executed in accordance with the Company's Articles of
Incorporation and By-Laws, and with applicable law. The interpretation and
construction by the Board of any provision of the Plan or of any Incentive Award
granted or Agreement entered into hereunder shall be final and conclusive.
(b) Committee. The Board may from time to time appoint
an Equity Incentive Compensation Plan Committee (the "Committee") consisting of
one or more members of the Board. The Board, in its sole discretion, may provide
that the role of the Committee shall be limited to making recommendations to the
Board concerning any determinations to be made and actions to be taken by the
Board pursuant to or with respect to the Plan, or the board may delegate to the
Committee such powers and authorities related to the administration of the Plan,
as set forth in Section 2(a) above, as the Board shall determine, consistent
with the Articles of Incorporation and By-Laws of the Company and applicable
law. The Board may remove members, add members, and fill vacancies on the
committee from time to time, all in accordance with the company's Articles of
Incorporation and By-Laws, and with applicable law. The majority vote 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.
(c) No Liability. No member of the Board or of the
Committee shall be liable for any action or determination made in good faith
with respect to the Plan or any Incentive Award granted or Agreement entered
into hereunder.
(d) Delegation to the Committee. In the event that the
Plan or any Incentive Award granted or Agreement entered into hereunder provides
for any action to be taken by or determination to be made by the Board, such
action may be taken by or such determination may be made by the Committee if the
power and authority to do so has been delegated to the Committee by the Board as
provided for in Section 2(b) above. Unless otherwise expressly determined by the
Board, any such action or determination by the Committee shall be final and
conclusive.
3. STOCK
The stock that may be issued pursuant to Incentive Awards under
the Plan shall be shares of Common Stock, par value $0.001 per share, of the
Company (the "Stock"), which shares may be treasury shares or authorized but
unissued
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shares. The number of shares of Stock that may be issued pursuant to Incentive
Awards under the Plan shall not exceed, in the aggregate, 8,179,000 shares,
which number of shares is subject to adjustment as hereinafter provided in
Section 17 below. If any Incentive Award expires, terminates, or is terminated
for any reason prior to exercise or vesting in full, the shares of Stock that
were subject to the unexercised, forfeited or terminated portion of such
Incentive Award shall be available for future grants of Incentive Awards under
the Plan.
4. ELIGIBILITY
Incentive Awards may be granted under the Plan to any employee or
director of, or any consultant to the Company or any Subsidiary (including any
such employee who is an officer or director of the Company or any Subsidiary) as
the Board shall determine and designate from time to time prior to expiration or
termination of the Plan. An individual may hold more than one Incentive Award,
subject to such restrictions as are provided herein.
5. EFFECTIVE DATE AND TERM OF THE PLAN
(a) Effective Date. The Plan shall be effective as of
the date of adoption by the Board, subject to approval of the Plan within one
year of such effective date by a majority of the votes cast at a duly held
meeting of the shareholders of the Company at which a quorum representing at
least a majority of outstanding shares of stock of the Company entitled to vote
thereon is, either in person or by proxy, present and voting on the Plan or by
written consent in accordance with the Articles of Incorporation and By-Laws of
the Company; provided, however, that upon approval of the Plan by the
shareholders of the Company as set forth above, all Incentive Awards granted
under the Plan on or after the effective date shall be fully effective as if the
shareholders of the Company had approved the Plan on the effective date. If the
shareholders fail to approve the Plan within one year of such effective date,
any Incentive Awards granted hereunder shall be null and void and of no effect.
(b) Term. The Plan shall terminate on the date ten years
from the effective date.
6. GRANT OF OPTIONS AND SHARES OF RESTRICTED STOCK
(a) Options. Subject to the terms and conditions of the
Plan, the Board may, at any time and from time to time, prior to the date of
termination of the Plan, grant to such eligible individuals as the Board may
determine ("Optionees"), Options to purchase such number of shares of the Stock
on such terms and conditions as the Board may determine, including any terms or
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conditions which may be necessary to qualify such Options as Incentive Stock
Options. The date on which the Board approves the grant of an Option shall be
considered the date on which such Option is granted.
(b) Restricted Stock Awards. Subject to the terms of the
Plan, the Board may, at any time and from time to time, prior to the date of
termination of the Plan, grant to such eligible individuals as the Board may
determine ("Holders"), shares of restricted Stock, subject to (i) payment by the
Holder of not less than the par value of such stock and (ii) the attainment of
such performance objectives and the completion of such service requirements (if
any) as the Board shall determine and specify as a condition to making such
grant. Each such grant shall be effected by the execution of an Agreement
setting out the terms and conditions applicable thereto and by the issuance of
shares of restricted Stock. Upon attainment of the specified objectives and
requirements (or, to the extent specified by the Board, partial attainment of
such objectives and requirements), the Holder shall be entitled to shares of
Stock specified in the grant (or the portion of such shares earned by partial
attainment of the objectives and requirements, as applicable) free of
restrictions, except that such shares of Stock shall continue to be subject to
the restrictions set out in Section 11(b) and (c). Upon the failure of (i) the
Holder to pay the price specified for the shares within the time set by the
Board at the time of the grant or, (ii) upon the expiration of the specified
period for attaining performance objectives without such objectives having been
achieved or (iii) upon termination of the Holder's employment without the Holder
having satisfied the service requirement specified at the time of grant (the
"Conditions"), except as shall otherwise have been specified in the Agreement at
the time of grant or in an amendment thereto, the shares of restricted Stock (or
appropriate portion thereof) shall be forfeited and shall again be available for
regrant under the terms of the Plan. The Board may require that the certificates
evidencing the grant of shares of restricted Stock hereunder be held in escrow
until such restrictions have expired. The Board may also cause a legend to be
placed on such certificates making appropriate reference to the restrictions to
which the shares are subject.
(c) Cancellation and New Grant of Options. The Board
shall have the authority to effect, at any time and from time to time, with the
consent of the affected optionees, the cancellation of any or all outstanding
Options under the Plan and the grant in substitution therefor of new Options
under the Plan covering the same or different numbers of shares of Stock having
an exercise price per share which may be lower or higher than the exercise price
per share of the canceled Options.
(d) Acceleration. The Board may, in its sole discretion,
accelerate the date or dates on which all or any particular Option or Options
granted under the Plan may be exercised or on which any Conditions under
Restricted Stock Awards lapse.
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7. LIMITATION ON INCENTIVE STOCK OPTIONS
An Option (other than an Option described in exception (ii) or
(iii) of Section 1) shall constitute an Incentive Stock Option only to the
extent that the aggregate fair market value (determined at the time the Option
is granted) of the Stock with respect to which options intended to constitute
Incentive Stock Options are exercisable for the first time by any Optionee
during any calendar year (under the Plan and all other plans of the Optionee's
employer corporation and its parent and subsidiary corporations within the
meaning of Section 422(b)(7) of the Code) does not exceed $100,000.
8. OPTION AGREEMENTS
All Options granted pursuant to the Plan shall be evidenced by
Agreements ("Option Agreements"), to be executed by the Company and by the
Optionee, in such form or forms as the Board shall from time to time determine.
Option Agreements covering Options granted from time to time or at the same time
need not contain similar provisions; provided, however, that all such Option
Agreements shall comply with all terms of the Plan. Any amendment or
modification to an Option Agreement shall be made by a written instrument
approved by the Board and executed by or on behalf of the Company and the
Optionee (or permitted transferee of the Optionee).
9. OPTION PRICE
The purchase price of each share of the Stock subject to an Option
(the "Option Price") shall be determined by the Board and stated in each Option
Agreement.
In the case of an Option intended to constitute an Incentive Stock
Option, the Option Price shall be not less than the greater of par value or 100%
of the fair market value of a share of the Stock on the date the Option is
granted (as determined in good faith by the Board); provided, however, that in
the event the Optionee would otherwise be ineligible to receive an Incentive
Stock Option by reason of the provisions of Sections 422(b)(6) and 424(d) of the
Code (relating to stock ownership of more than ten percent (10%)), the Option
Price of an Option which is intended to be an Incentive Stock Option (within the
meaning of Section 422 of the Code) shall be not less than the greater of par
value or 110% of the fair market value of a share of Stock at the time such
Option is granted. In the event that the Stock is listed on an established
national or regional stock exchange, is admitted to quotation on the National
Association of Securities Dealers Automated Quotation System, or is publicly
traded in an established securities market, in determining the fair market value
of the Stock, the Board shall use the closing price of the Stock on such
exchange or System or in such market (the
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highest such closing price if there is more than one such exchange or market) on
the trading date immediately before the Option is granted (or, if there is no
such closing price, then the Board shall use the mean between the highest bid
and lowest asked prices or between the high and low prices on such date), or, if
no sale of the Stock has been made on such day, on the next preceding day on
which any such sale shall have been made. Such determination of the fair market
value of such shares shall be final, binding, and conclusive.
In the case of an Option not intended to constitute an "Incentive
Stock Option," the Option Price shall not be less than par value.
10. TERM AND EXERCISE OF OPTIONS
(a) Term. Each Option granted under the Plan shall
terminate and all rights to purchase shares thereunder shall cease upon the
expiration of ten years from the date such Option is granted or on such date
prior thereto as may be fixed by the Board and stated in the Option Agreement
relating to such Option (subject to earlier termination as provided in the
Plan); provided, however, that in the event the Optionee would otherwise be
ineligible to receive an Incentive Stock Option by reason of the provisions of
Sections 422(b)(6) and 424(d) of the Code (relating to stock ownership of more
than ten percent (10%)), an Option granted to such Optionee which is intended to
be an Incentive Stock Option shall in no event be exercisable after the
expiration of five years from the date it is granted.
(b) Option Period and Limitations on Exercise. Each
Option granted under the Plan shall be exercisable, in whole or in part, at any
time and from time to time, over a period commencing on or after the date of
grant and ending upon the expiration or termination of the Option, as the Board
shall determine and set forth in the Option Agreement relating to such Option or
any amendment thereto. Without limiting the foregoing, the Board, subject to the
terms and conditions of the Plan, may in its sole discretion provide that an
Option may not be exercised in whole or in part for any period or periods of
time during which such Option is outstanding and may condition exercisability of
an Option upon the Optionee's attainment of performance objectives set out in
the Option Agreement; provided, however, that any such limitation or condition
on the exercise of an Option contained in any Option Agreement may be rescinded,
modified or waived by the Board, in its sole discretion, at any time and from
time to time after the date of grant of such Option, so as to accelerate the
time at which the Option may be exercised. Notwithstanding any other provisions
of the Plan, no Option granted to an Optionee under the Plan shall be
exercisable in whole or in part prior to the date the Plan is approved by the
shareholders of the Company as provided in Section 5 above.
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(c) Method of Exercise. An Option that is exercisable
hereunder may be exercised by delivery to the Company on any business day, at
its principal office, addressed to the attention of the Board, of written notice
of exercise, which notice shall specify the number of shares with respect to
which the Option is being exercised, and shall be accompanied by payment in full
of the Option Price of the shares for which the Option is being exercised,
except as provided below. Payment of the Option Price for the shares of Stock
purchased pursuant to the exercise of an Option shall be made (i) in cash or in
cash equivalents; (ii) through the tender to the Company of shares of Stock,
which shares shall be valued, for purposes of determining the extent to which
the Option Price has been paid thereby, at their fair market value (determined
in the manner described in Section 9 above) on the date of exercise; (iii) if at
the time of exercise the Stock is publicly traded on an established securities
market or exchange, by delivering a written direction to the Company that the
Option be exercised pursuant to a "cashless" exercise/sale procedure (pursuant
to which funds to pay for exercise of the option are delivered to the Company by
a broker upon receipt of stock certificates from the Company) or a cashless
exercise/loan procedure (pursuant to which the Optionees would obtain a margin
loan from a broker to fund the exercise) through a licensed broker acceptable to
the Company whereby the stock certificate or certificates for the shares of
Stock for which the Option is exercised will be delivered to such broker as the
agent for the individual exercising the Option and the broker will deliver to
the Company cash (or cash equivalents acceptable to the Company) equal to the
Option Price for the shares of Stock purchased pursuant to the exercise of the
Option plus the amount (if any) of federal and other taxes that the Company,
may, in its judgment, be required to withhold with respect to the exercise of
the Option; or (iv) by a combination of the methods described in (i), (ii) and
(iii). The Optionee's right to pay the exercise price by exchange of Stock,
however, is subject to the following limitation: the Stock being exchanged must
have been held by the Optionee for at least six months. Payment in full of the
Option Price need not accompany the written notice of exercise if the Option is
exercised pursuant to the cashless exercise/sale procedure described above. An
attempt to exercise any Option granted hereunder other than as set forth above
shall be invalid and of no force and effect. Promptly after the exercise of an
Option and the payment in full of the Option Price of the shares of Stock
covered thereby, the individual exercising the Option shall be entitled to the
issuance of a Stock certificate or certificates evidencing his ownership of such
shares. A separate Stock certificate or certificates shall be issued for any
shares purchased pursuant to the exercise of an Option which is an Incentive
Stock Option, which certificate or certificates shall not include any shares
which were purchased pursuant to the exercise of an Option which is not an
Incentive Stock Option. An individual holding or exercising an Option shall have
none of the rights of a shareholder until the shares of Stock covered thereby
are fully paid and issued to him and, except as provided in Section 16 below, no
adjustment shall be made for dividends or other rights for which the record date
is
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prior to the date of such issuance. Shares issued pursuant to the exercise shall
be subject to the applicable restrictions set out in Section 11 hereof.
11. TRANSFERABILITY OF STOCK AND OPTIONS
(a) Transferability. During the lifetime of an Optionee,
only such Optionee (or, in the event of legal incapacity or incompetency, the
guardian or legal representative of the Optionee) may exercise the Option. No
Option shall be assignable or transferable by the Optionee to whom it is
granted, other than by will or the laws of descent and distribution. No shares
of restricted stock shall be assignable or transferable, other than by will or
the laws of descent and distribution, prior to the satisfaction of applicable
performance and service requirements with respect to such shares. No holder of
shares acquired pursuant to this Plan shall sell, assign, transfer, pledge or
hypothecate such shares except in accordance with the terms of this Plan and any
applicable shareholders agreement. No holder of shares acquired pursuant to this
Plan will pledge or hypothecate such shares without the prior consent of the
Company. Notwithstanding anything to the contrary, any unrestricted shares
acquired pursuant to this Plan may be transferred by gift to the holder's
"Family", provided that any such transferee shall enter into a written agreement
to be bound by the terms of this Plan and any applicable shareholders agreement.
For this purpose, "Family" shall mean the siblings, children, parents and spouse
of the holder of such shares.
(b) Repurchase Rights.
(i) Upon the termination of the employment or
service with the Company or a Subsidiary for any reason of an employee who has
been granted Incentive Awards hereunder, the Company shall have the right, for a
period of 180 days following such termination, to repurchase any or all of the
shares acquired by the employee pursuant to this Plan under an Incentive Award
(including shares that were previously transferred pursuant to Subsection 11(c)
below, unless otherwise specified in the Agreement relating to such Incentive
Award), at a price equal to the fair market value of such shares on the date of
termination (or at such lower price as shall have been specified by the Board at
the time of grant and set out in the appropriate Option or restricted Stock
Agreement with respect to the grant). Upon the exercise, pursuant to Section 12
or 13 below, of an Option following termination of employment or service, the
Company shall have the right, for a period of 180 days following such exercise,
to repurchase any or all such shares at a price equal to the fair market value
of such shares on the date of exercise (or at such lower price as shall have
been specified by the Board at the time of grant and set out in the appropriate
Option Agreement with respect to the grant).
(ii) In the event that the Company determines that
it cannot or will not exercise its rights to purchase Stock under this
Section 11(b), in
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whole or in part, the Company may assign its rights, in whole or in part, to (A)
any shareholder of the Company who owns stock or securities of the Company
having more than 50% of the combined voting power of all classes of stock of the
Company (a "Shareholder"), (B) any employee benefit plan (within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended)
maintained by the Company or a Subsidiary for the benefit of employees of the
Company or a Subsidiary (a "Plan"), or (C) any corporation or other trade or
business that is controlled by or under common control with the Company
(determined in accordance with the principles of Section 414(b) and (c) of the
Code and the regulations thereunder) (an "Affiliate"). The Company shall give
reasonable written notice to the employee of any assignment of its rights.
(c) [Reserved].
(d) Legend. In order to enforce the restrictions imposed
upon shares under this Plan or as provided in an Agreement relating to an
Incentive Award, the Board may cause a legend or legends to be placed on any
certificate representing shares issued pursuant to this Plan which legend or
legends shall make appropriate reference to the restriction imposed under it.
(e) Put Rights. The Board, by inclusion of appropriate
language in the Agreement relating to an Incentive Award, may grant the person
acquiring shares of Stock thereunder the right to put such shares to the Company
at the fair market value of such shares (as determined hereunder) at the time of
exercise of such put, or at such other value as shall be specified on the
Agreement, subject to such further terms and conditions as the Board shall
include in the Agreement relating to such Incentive Award.
(f) Additional Provisions. The Board may, in its sole
discretion, include additional provisions in any Incentive Award granted under
the Plan, including without limitation restrictions on transfer, repurchase
rights, commitments to pay cash bonuses, arrangements for loans or transfers of
property to Optionees upon exercise of Options, a requirement to enter into any
applicable shareholders agreement by and among the Company and any of its
shareholders or such other provisions as shall be determined by the Board;
provided, however, that such additional provisions shall not be inconsistent
with any term or condition of the Plan and such additional provisions shall not
cause any Incentive Stock Option granted under the Plan to fail to qualify as an
Incentive Stock Option within the meaning of Section 422 of the Code.
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12. TERMINATION OF SERVICE OR EMPLOYMENT OF OPTIONEE
Upon the termination of the employment or service of an Optionee,
or Holder with the Company or a Subsidiary, other than by reason of the death or
"permanent and total disability" (within the meaning of Section 22(e)(3) of the
Code) of such individual, any Option or shares of restricted stock that have not
become vested to such individual pursuant to the Plan, shall terminate and such
individual shall have no further right to purchase shares of Stock pursuant to
such Option and such restricted stock shall be forfeited; provided, however,
that the Board may provide, by inclusion of appropriate language in any Option
or restricted Stock Agreement, that the grantee may (subject to the general
limitations on exercise set forth in Section 10(b) above), in the event of
termination of employment or service with the Company or a Subsidiary, exercise
an Option or receive unrestricted shares of Stock, in whole or in part, at any
time subsequent to such termination of employment and prior to termination of
the Incentive Award as provided in Sections 6 and 10 above, either subject to or
without regard to any installment limitation, condition on exercise or transfer,
or vesting requirement imposed pursuant to such Sections. Whether a leave of
absence or leave on military or government service shall constitute a
termination of employment or service for purposes of the Plan shall be
determined by the Board, which determination shall be final and conclusive. For
purposes of the Plan, a termination of employment or service with the Company or
a Subsidiary shall not be deemed to occur if the Optionee is immediately
thereafter employed by or engaged with the Company or any Subsidiary in any
capacity.
13. RIGHTS IN THE EVENT OF DEATH OR DISABILITY
(a) Death. If an Optionee dies while employed by or
providing service to the Company or a Subsidiary, the executors or
administrators or legatees or distributees of such individual's estate shall
have the right (subject to the general limitations on exercise set forth in
Section 10(b) above), at any time within six (6) months after the date of such
individual's death and before termination of the Option as provided in Section
10(a) above, to exercise any vested portion of the Option held by such
individual at the date of such individual's death. The extent to which shares of
restricted Stock shall become vested as a result of the grantee's death while
employed by or providing services to the Company or a Subsidiary shall be
determined by the Board at the time of grant of such shares of restricted Stock
and specified in the related Agreement.
(b) Disability. If an Optionee terminates employment or
service with the Company or a Subsidiary by reason of the "permanent and total
disability" (within the meaning of Section 22(e)(3) of the Code) of such person,
then
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such person shall have the right (subject to the general limitations on exercise
set forth in Section 10(b) above), at any time within six (6) months after such
termination of employment or service and before termination of the Option as
provided in Section 10(a) above, to exercise, in whole or in part, any vested
portion of the Option held by such person at the date of such termination of
employment or service. Whether a termination of employment is to be considered
by reason of "permanent and total disability" for purposes of this Plan shall be
determined by the Board, which determination shall be final and conclusive. The
extent to which shares of restricted stock shall become vested as a result of
the grantee's "total and permanent disability" while employed by or engaged in
performing services for the Company or a Subsidiary shall be determined by the
Board at the time of grant of such shares of restricted stock and specified in
the related Agreement.
14. USE OF PROCEEDS
The proceeds received by the Company from the sale of Stock
pursuant to the exercise of Options granted under the Plan and the issuance of
shares of restricted stock hereunder shall constitute general funds of the
Company.
15. REQUIREMENTS OF LAW
The Company shall not be required to sell, issue or transfer any
shares of Stock under any Incentive Award if the sale, issuance or transfer of
such shares would constitute a violation by the Holder or the individual
exercising the Option or the Company of any provisions of any law or regulation
of any governmental authority, including without limitation any federal or state
securities laws or regulations. Specifically in connection with the Securities
Act of 1933 (as now in effect or as hereafter amended), at the time of grant of
restricted Stock or when such Stock becomes vested or upon exercise of any
Option, unless a registration statement under such Act is in effect with respect
to the shares of Stock covered by thereby, the Company shall not be required to
sell or issue such shares unless the Board has received evidence satisfactory to
it that the holder of such restricted Stock or Option may acquire such shares
pursuant to an exemption from registration under such Act. Any determination in
this connection by the Board shall be final, binding, and conclusive. The
Company may, but shall in no event be obligated to, register any securities
covered hereby pursuant to the Securities Act of 1933 (as now in effect or as
hereafter amended). The Company shall not be obligated to take any affirmative
action in order to cause the exercise of an Option or the issuance of shares
pursuant thereto or pursuant to a grant of restricted Stock to comply with any
law or regulation of any governmental authority. As to any jurisdiction that
expressly imposes the requirement that an Option shall not be exercisable or
that shares of Stock may not be issued pursuant to a grant of restricted Stock
unless and until the shares of Stock covered by such grant or Option are
registered or are subject to an available exemption from registration, the
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exercise of such Option or issuance of shares of Stock pursuant to such grant
(under circumstances in which the laws of such jurisdiction apply) shall be
deemed conditioned upon the effectiveness of such registration or the
availability of such an exemption.
16. AMENDMENT AND TERMINATION OF THE PLAN
The Board may, at any time and from time to time, amend, suspend
or terminate the Plan as to any shares of Stock as to which Incentive Awards
have not been granted; provided, however, that no amendment by the Board shall,
without approval by a majority of the votes cast at a duly held meeting of the
shareholders of the Company at which a quorum representing at least a majority
of outstanding shares of stock of the Company entitled to vote thereon is,
either in person or by proxy, present and voting on the Plan or by written
consent in accordance with the Articles of Incorporation and By-Laws of the
Company, (a) change the requirements as to eligibility to receive Incentive
Stock Options; or (b) increase the maximum number of shares of Stock in the
aggregate that may be sold or issued pursuant to grants of Incentive Stock
Options under the Plan (except as permitted under Section 17 hereof). Except as
permitted under Section 17 hereof, no amendment, suspension or termination of
the Plan shall not, without the consent of the holder of the Incentive Award,
alter or impair rights or obligations under any Incentive Award theretofore
granted under the Plan. With the consent of the Optionee or Holder, the Board
may amend any outstanding Agreement in a manner not inconsistent with the Plan.
Amendments to the Plan not requiring stockholder approval shall become effective
when adopted by the Board; amendments requiring stockholder approval (as
provided in this Section 16) shall become effective when adopted by the Board,
but no Incentive Stock Option issued after the date of such amendment shall
become exercisable (to the extent that such amendment to the Plan was required
to enable the Company to grant such Incentive Stock Option to a particular
Optionee) unless and until such amendment shall have been approved by the
Company's stockholders. If such stockholder approval is not obtained within
twelve (12) months of the Board's adoption of such amendment, any Incentive
Stock Options granted on or after the date of such amendment shall terminate to
the extent that such amendment to the Plan was required to enable the Company to
grant such Option to a particular Optionee.
17. EFFECT OF CHANGES IN CAPITALIZATION
(a) Changes in Stock. If the outstanding shares of Stock
are increased or decreased or changed into or exchanged for a different number
or kind of shares or other securities of the Company by reason of any
recapitalization, reclassification, stock split-up, combination of shares,
exchange of shares, stock dividend or other distribution payable in capital
stock, or other increase or decrease in such shares effected without receipt of
consideration by the Company, occurring
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after the effective date of the Plan, the number and kinds of shares for the
issuance of which restricted Stock may be awarded and for the acquisition of
which Options may be granted under the Plan shall be adjusted proportionately
and accordingly by the Company. In addition, the number and kind of shares for
which Options are outstanding shall be adjusted proportionately and accordingly
so that the proportionate interest of the holder of the Option immediately
following such event shall, to the extent practicable, be the same as
immediately before such event. Any such adjustment in outstanding Options shall
not change the aggregate Option Price payable with respect to shares subject to
the unexercised portion of the Option outstanding but shall include a
corresponding proportionate adjustment in the Option Price per share.
(b) Reorganization in Which the Company Is the Surviving
Corporation. Subject to Subsection (c) hereof, if the Company shall be the
surviving corporation in any reorganization, merger, or consolidation of the
Company with one or more other corporations, any Option theretofore granted
pursuant to the Plan shall pertain to and apply to the securities to which a
holder of the number of shares of Stock subject to such Option would have been
entitled immediately following such reorganization, merger, or consolidation,
with a corresponding proportionate adjustment of the Option Price per share so
that the aggregate Option Price thereafter shall be the same as the aggregate
Option Price of the shares remaining subject to the Option immediately prior to
such reorganization, merger, or consolidation.
(c) Reorganization in Which the Company Is Not the
Surviving Corporation or Sale of Assets or Stock. Upon the dissolution or
liquidation of the Company, or upon a merger, consolidation or reorganization of
the Company with one or more other corporations in which the Company is not the
surviving corporation, or upon a sale of all or substantially all of the assets
of the Company to another corporation, or upon any transaction (including,
without limitation, a merger or reorganization in which the Company is the
surviving corporation) approved by the Board which results in any person or
entity (other than persons who are shareholders of the Company at the time the
Plan is approved by the shareholders and other than an Affiliate) owning 80% or
more of the combined voting power of all classes of stock of the Company, the
Plan and all Options outstanding hereunder shall terminate, except to the extent
a provision is made in writing in connection with such transaction for the
continuation of the Plan and/or the assumption of such Options theretofore
granted, or for the substitution for such Options of new options covering the
stock of a successor corporation, or a parent or subsidiary thereof, with
appropriate adjustments as to the number and kinds of shares and exercise
prices, in which event the Plan and Options theretofore granted shall continue
in the manner and under the terms so provided. In the event of any such
termination of the Plan, each individual holding an Option shall have the right
(subject to the general limitations on exercise set forth in
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Section 10(b) above), immediately before the occurrence of such termination and
during such period occurring before such termination as the Board in its sole
discretion shall determine and designate, to exercise such Option in whole or in
part, to the extent that such Option was otherwise exercisable at the time such
termination occurs, except that, by inclusion of appropriate language in an
Option Agreement, the Board may provide that the Option may be exercised before
termination without regard to any installment limitation or other condition on
exercise imposed pursuant to Section 10(b) above. The Board shall send written
notice of an event that will result in such a termination to all individuals who
hold Options not later than the time at which the Company gives notice thereof
to its shareholders. The extent to which unvested shares of restricted Stock
shall be vested or forfeited in the case of an event described in this Section
17(c) shall be set out in the Agreement with respect to such grant; in the
absence of such a provision, the unvested shares shall be forfeited.
(d) Adjustments. Adjustments under this Section 17
related to stock or securities of the Company shall be made by the Board, whose
determination in that respect shall be final, binding, and conclusive. No
fractional shares of Stock or units of other securities shall be issued pursuant
to any such adjustment, and any fractions resulting from any such adjustment
shall be eliminated in each case by rounding downward to the nearest whole share
or unit.
(e) No Limitations on Company. The grant of shares of
Incentive Awards pursuant to the Plan shall not affect or limit 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,
consolidate, dissolve or liquidate, or to sell or transfer all or any part of
its business or assets.
18. DISCLAIMER OF RIGHTS
No provision in the Plan or in any Incentive Award granted or
agreement entered into pursuant to the Plan shall be construed to confer upon
any individual the right to remain in the employ or service of the Company or
any Subsidiary, or to interfere in any way with the right and authority of the
Company or any Subsidiary either to increase or decrease the compensation of any
individual at any time, or to terminate any employment or other relationship
between any individual and the Company or any Subsidiary. The obligation of the
Company to pay any benefits pursuant to this Plan shall be interpreted as a
contractual obligation to pay only those amounts described herein, in the manner
and under the conditions prescribed herein. The Plan shall in no way be
interpreted to require the Company to transfer any amounts to a third party
trustee or otherwise hold any amounts in trust or escrow for payment to any
participant or beneficiary under the terms of the Plan.
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19. NONEXCLUSIVITY OF THE PLAN
Neither the adoption of the Plan nor the submission of the Plan to
the shareholders of the Company for approval shall be construed as creating any
limitations upon the right and authority of the Board to adopt such other
incentive compensation arrangements (which arrangements may be applicable either
generally to a class or classes of individuals or specifically to a particular
individual or individuals) as the Board in its discretion determines desirable,
including, without limitation, the granting of restricted stock, stock options
or stock appreciation rights otherwise than under the Plan.
* * *
The amendments to this Plan were duly adopted and approved by the
Board of Directors of the Company on the 25th day of October, 2000.
/s/ James E. Bernstein, MD
---------------------------------
Secretary
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