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EXHIBIT 99.2
ALLOS THERAPEUTICS, INC.
2000 STOCK INCENTIVE COMPENSATION PLAN
SECTION 1. PURPOSE
The purpose of the Allos Therapeutics, Inc. 2000 Stock Incentive
Compensation Plan (the "Plan") is to enhance the long-term stockholder value of
Allos Therapeutics, Inc., a Delaware corporation (the "Company"), by offering
opportunities to selected persons to participate in the Company's growth and
success, and to encourage them to remain in the service of the Company and its
Related Corporations (as defined in Section 2) and to acquire and maintain stock
ownership in the Company.
SECTION 2. DEFINITIONS
For purposes of the Plan, the following terms shall be defined as set
forth below:
"AWARD" means an award or grant made pursuant to the Plan, including,
without limitation, awards or grants of Stock Awards and Options, or any
combination of the foregoing.
"BOARD" means the Board of Directors of the Company.
"CAUSE" means dishonesty, fraud, misconduct, unauthorized use or
disclosure of confidential information or trade secrets, or conviction or
confession of a crime punishable by law (except minor violations), in each case
as determined by the Plan Administrator, and its determination shall be
conclusive and binding.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
"COMMON STOCK" means the common stock, par value $0.001 per share, of
the Company.
"CORPORATE TRANSACTION" has the meaning set forth in Section 12.3(a).
"DISABILITY," unless otherwise defined by the Plan Administrator, means
a mental or physical impairment of the Participant that is expected to result in
death or that has lasted or is expected to last for a continuous period of 12
months or more and that causes the Participant to be unable, in the opinion of
the Company, to perform his or her duties for the Company or a Related
Corporation and to be engaged in any substantial gainful activity.
"EFFECTIVE DATE" has the meaning set forth in Section 15.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
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"FAIR MARKET VALUE" shall be as established in good faith by the Plan
Administrator or (a) if the Common Stock is listed on the Nasdaq National
Market, the closing sales price for the Common Stock as reported by the Nasdaq
National Market for a single trading day or (b) if the Common Stock is listed on
the New York Stock Exchange or the American Stock Exchange, the closing sales
price for the Common Stock as such price is officially quoted in the composite
tape of transactions on such exchange for a single trading day. If there is no
such reported price for the Common Stock for the date in question, then such
price on the last preceding date for which such price exists shall be
determinative of Fair Market Value.
"GRANT DATE" means the date on which the Plan Administrator completes
the corporate action relating to the grant of an Award and all conditions
precedent to the grant have been satisfied, provided that conditions to the
exercisability or vesting of Awards shall not defer the Grant Date.
"INCENTIVE STOCK OPTION" means an Option to purchase Common Stock
granted under Section 7 with the intention that it qualify as an "incentive
stock option" as that term is defined in Section 422 of the Code.
"NONQUALIFIED STOCK OPTION" means an Option to purchase Common Stock
granted under Section 7 other than an Incentive Stock Option.
"OPTION" means the right to purchase Common Stock granted under Section
7.
"OPTION TERM" has the meaning set forth in Section 7.3.
"PARENT," except as otherwise provided in Section 8.3 in connection
with Incentive Stock Options, means any entity, whether now or hereafter
existing, that directly or indirectly controls the Company.
"PARTICIPANT" means (a) the person to whom an Award is granted; (b) for
a Participant who has died, the personal representative of the Participant's
estate, the person(s) to whom the Participant's rights under the Award have
passed by will or by the applicable laws of descent and distribution, or the
beneficiary designated in accordance with Section 11; or (c) the person(s) to
whom an Award has been transferred in accordance with Section 11.
"PLAN ADMINISTRATOR" means the Board or any committee or committees
designated by the Board to administer the Plan under Section 3.1.
"RELATED CORPORATION" means any Parent or Subsidiary of the Company.
"RETIREMENT" means retirement as of the individual's normal retirement
date under the Company's 401(k) plan or other similar successor plan applicable
to salaried employees, unless otherwise defined by the Plan Administrator from
time to time for purposes of the Plan.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
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"STOCK AWARD" means shares of Common Stock or units denominated in
Common Stock granted under Section 9, the rights of ownership of which may be
subject to restrictions prescribed by the Plan Administrator.
"SUBSIDIARY," except as otherwise provided in Section 8.3 in connection
with Incentive Stock Options, means any entity that is directly or indirectly
controlled by the Company.
"SUCCESSOR CORPORATION" has the meaning set forth in Section 12.3(b).
"TERMINATION DATE" has the meaning set forth in Section 7.6.
SECTION 3. ADMINISTRATION
3.1 PLAN ADMINISTRATOR
The Plan shall be administered by the Board and/or a committee or
committees (which term includes subcommittees) appointed by, and consisting of
two or more members of, the Board (a "Plan Administrator"). If and so long as
the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act,
the Board shall consider in selecting the members of any committee acting as
Plan Administrator, with respect to any persons subject or likely to become
subject to Section 16 of the Exchange Act, the provisions regarding (a) "outside
directors" as contemplated by Section 162(m) of the Code and (b) "nonemployee
directors" as contemplated by Rule 16b-3 under the Exchange Act. Notwithstanding
the foregoing, the Board may delegate the responsibility for administering the
Plan with respect to designated classes of eligible persons to different
committees consisting of one or more members of the Board, subject to such
limitations as the Board deems appropriate. Committee members shall serve for
such term as the Board may determine, subject to removal by the Board at any
time.
3.2 ADMINISTRATION AND INTERPRETATION BY PLAN ADMINISTRATOR
Except for the terms and conditions explicitly set forth in the
Plan, the Plan Administrator shall have exclusive authority, in its discretion,
to determine all matters relating to Awards under the Plan, including the
selection of individuals to be granted Awards, the type of Awards, the number of
shares of Common Stock subject to an Award, all terms, conditions, restrictions
and limitations, if any, of an Award and the terms of any instrument that
evidences the Award. The Plan Administrator shall also have exclusive authority
to interpret the Plan and the terms of any instrument evidencing the Award and
may from time to time adopt and change rules and regulations of general
application for the Plan's administration. The Plan Administrator's
interpretation of the Plan and its rules and regulations, and all actions taken
and determinations made by the Plan Administrator pursuant to the Plan, shall be
conclusive and binding on all parties involved or affected. The Plan
Administrator may delegate administrative duties to such of the Company's
officers as it so determines.
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SECTION 4. STOCK SUBJECT TO THE PLAN
4.1 AUTHORIZED NUMBER OF SHARES
Subject to adjustment from time to time as provided in Section
12.1, the number of shares of Common Stock that shall be available for issuance
under the Plan shall be:
(a) 100 shares plus;
(b) an annual increase to be added as of the first day of the
Company's fiscal year beginning in 2001 equal to the lesser of (i) 440,000
shares and (ii) 2% of the adjusted average common shares outstanding of the
Company used to calculate fully diluted earnings per share as reported in the
Annual Report to stockholders for the preceding year or (iii) any lesser amount
determined by the Board; provided that any shares from any such increases in
previous years that are not actually issued shall be added to the aggregate
number of shares available for issuance under the Plan; plus
(c) any authorized shares (i) not issued or subject to outstanding
awards under the Company's 1995 Stock Option Plan (the "Prior Plan") on the
Effective Date and (ii) any shares subject to outstanding awards under the Prior
Plan on the Effective Date that cease to be subject to such awards (other than
by reason of exercise or payment of the awards to the extent they are exercised
for or settled in shares), which shares shall cease, as of the date of
stockholder approval of the Plan, to be available for grant and issuance under
the Prior Plan, but shall be available for issuance under the Plan.
Shares issued under the Plan shall be drawn from authorized and
unissued shares or shares now held or subsequently acquired by the Company as
treasury shares.
4.2 REUSE OF SHARES
Any shares of Common Stock that have been made subject to an Award
that cease to be subject to the Award (other than by reason of exercise or
payment of the Award to the extent it is exercised for or settled in vested and
nonforfeitable shares) shall again be available for issuance in connection with
future grants of Awards under the Plan.
SECTION 5. ELIGIBILITY
Awards may be granted under the Plan to those officers, directors and
employees of the Company and its Related Corporations as the Plan Administrator
from time to time selects. Awards may also be made to consultants, agents,
advisors and independent contractors who are engaged to provide services to the
Company and its Related Corporations; provided, however, that such Participants
render bona fide services that are not in connection with the offer and sale of
the Company's securities in a capital-raising transaction and do not directly or
indirectly promote or maintain a market for the Company's securities.
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SECTION 6. AWARDS
6.1 FORM AND GRANT OF AWARDS
The Plan Administrator shall have the authority, in its sole
discretion, to determine the type or types of Awards to be made under the Plan.
Such Awards may include, but are not limited to, Incentive Stock Options,
Nonqualified Stock Options and Stock Awards. Awards may be granted singly or in
combination.
6.2 SETTLEMENT OF AWARDS
The Company may settle Awards through the delivery of shares of
Common Stock, cash payments, the granting of replacement Awards or any
combination thereof as the Plan Administrator shall determine. Any Award
settlement, including payment deferrals, may be subject to such conditions,
restrictions and contingencies as the Plan Administrator shall determine. The
Plan Administrator may permit or require the deferral of any Award payment,
subject to such rules and procedures as it may establish, which may include
provisions for the payment or crediting of interest, or dividend equivalents,
including converting such credits into deferred stock equivalents. The Plan
Administrator may at any time offer to buy out, for a payment in cash or Common
Stock, an Award previously granted based on such terms and conditions as the
Plan Administrator shall establish and communicate to the Participant at the
time such offer is made.
6.3 ACQUIRED COMPANY AWARDS
Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Awards under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other acquired entities ("Acquired
Entities") (or the parent of the Acquired Entity) and the new Award is
substituted, or the old award is assumed, by reason of a merger, consolidation,
acquisition of property or stock, reorganization or liquidation (the
"Acquisition Transaction"). In the event that a written agreement pursuant to
which the Acquisition Transaction is completed is approved by the Board and said
agreement sets forth the terms and conditions of the substitution for or
assumption of outstanding awards of the Acquired Entity, said terms and
conditions shall be deemed to be the action of the Plan Administrator without
any further action by the Plan Administrator, except as may be required for
compliance with Rule 16b-3 under the Exchange Act, and the persons holding such
awards shall be deemed to be Participants.
SECTION 7. AWARDS OF OPTIONS
7.1 GRANT OF OPTIONS
The Plan Administrator is authorized under the Plan, in its sole
discretion, to issue Options as Incentive Stock Options or as Nonqualified Stock
Options, which shall be appropriately designated.
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7.2 OPTION EXERCISE PRICE
The exercise price for shares purchased under an Option shall be
as determined by the Plan Administrator, but shall not be less than 100% of the
Fair Market Value of the Common Stock on the Grant Date with respect to
Incentive Stock Options and not less than 85% of the Fair Market Value of the
Common Stock with respect to Nonqualified Stock Options. For Incentive Stock
Options granted to a more than 10% stockholder, the Option exercise price shall
be as specified in Section 8.2.
7.3 TERM OF OPTIONS
The term of each Option (the "Option Term") shall be as
established by the Plan Administrator or, if not so established, shall be ten
years from the Grant Date. For Incentive Stock Options, the maximum Option Term
shall be as specified in Sections 8.2 and 8.4.
7.4 EXERCISE OF OPTIONS
The Plan Administrator shall establish and set forth in each
instrument that evidences an Option the time at which, or the installments in
which, the Option shall vest and become exercisable, which provisions may be
waived or modified by the Plan Administrator at any time. If not so established
in the instrument evidencing the Option, the Option shall vest and become
exercisable according to the following schedule, which may be waived or modified
by the Plan Administrator at any time:
PERIOD OF PARTICIPANT'S CONTINUOUS
EMPLOYMENT OR SERVICE WITH THE
COMPANY OR ITS RELATED CORPORATIONS PERCENT OF TOTAL OPTION
FROM THE OPTION GRANT DATE THAT IS VESTED AND EXERCISABLE
After 1 year 25%
Each additional one-month period of An additional 1/48
continuous service completed thereafter
After 4 years 100%
The Plan Administrator may adjust the vesting schedule of an
Option held by a Participant who works less than "full-time" as that term is
defined by the Plan Administrator.
To the extent that an Option has vested and become exercisable,
the Option may be exercised from time to time by delivery to the Company of a
written stock option exercise agreement or notice, in a form and in accordance
with procedures established by the Plan Administrator, setting forth the number
of shares with respect to which the Option is being exercised, the restrictions
imposed on the shares purchased under such exercise agreement, if any, and such
representations and agreements as may be required by the Plan Administrator,
accompanied by payment in full as described in Section 7.5. An Option may not be
exercised for less than a reasonable number of shares at any one time, as
determined by the Plan Administrator.
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7.5 PAYMENT OF EXERCISE PRICE
The exercise price for shares purchased under an Option shall be
paid in full to the Company by delivery of consideration equal to the product of
the Option exercise price and the number of shares purchased. Such consideration
must be paid in cash or by check or, unless the Plan Administrator in its sole
discretion determines otherwise, either at the time the Option is granted or at
any time before it is exercised, in any combination of
(a) cash or check;
(b) tendering (either actually or, if and so long as the Common
Stock is registered under Section 12(b) or 12(g) of the Exchange Act, by
attestation) shares of Common Stock already owned by the Participant for at
least six months (or any shorter period necessary to avoid a charge to the
Company's earnings for financial reporting purposes) having a Fair Market Value
on the day prior to the exercise date equal to the aggregate Option exercise
price;
(c) if and so long as the Common Stock is registered under Section
12(b) or 12(g) of the Exchange Act, delivery of a properly executed exercise
notice, together with irrevocable instructions, to (i) a brokerage firm
designated by the Company to deliver promptly to the Company the aggregate
amount of sale or loan proceeds to pay the Option exercise price and any
withholding tax obligations that may arise in connection with the exercise and
(ii) the Company to deliver the certificates for such purchased shares directly
to such brokerage firm, all in accordance with the regulations of the Federal
Reserve Board; or
(d) such other consideration as the Plan Administrator may permit.
In addition, to assist a Participant (including a Participant who
is an officer or a director of the Company) in acquiring shares of Common Stock
pursuant to an Award granted under the Plan, the Plan Administrator, in its sole
discretion, may authorize, either at the Grant Date or at any time before the
acquisition of Common Stock pursuant to the Award, (i) the payment by a
Participant of a full-recourse promissory note, (ii) the payment by the
Participant of the purchase price, if any, of the Common Stock in installments,
or (iii) the guarantee by the Company of a full-recourse loan obtained by the
Participant from a third party. Subject to the foregoing, the Plan Administrator
shall in its sole discretion specify the terms of any loans, installment
payments or loan guarantees, including the interest rate and terms of and
security for repayment.
7.6 POST-TERMINATION EXERCISES
The Plan Administrator shall establish and set forth in each
instrument that evidences an Option whether the Option shall continue to be
exercisable, and the terms and conditions of such exercise, if a Participant
ceases to be employed by, or to provide services to, the Company or its Related
Corporations, which provisions may be waived or modified by the Plan
Administrator at any time. If not so established in the instrument evidencing
the Option, the Option shall be exercisable according to the following terms and
conditions, which may be waived or modified by the Plan Administrator at any
time:
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(a) Any portion of an Option that is not vested and exercisable on
the date of termination of the Participant's employment or service relationship
(the "Termination Date") shall expire on such date.
(b) Any portion of an Option that is vested and exercisable on the
Termination Date shall expire upon the earliest to occur of
(i) the last day of the Option Term;
(ii) if the Participant's Termination Date occurs for reasons
other than Cause, death, Disability, or Retirement, the three-month anniversary
of such Termination Date; and
(iii) if the Participant's Termination Date occurs by reason
of death, Disability or Retirement, the one-year anniversary of such Termination
Date.
Notwithstanding the foregoing, if the Participant dies after the
Termination Date while the Option is otherwise exercisable, the portion of the
Option that is vested and exercisable on such Termination Date shall expire upon
the earlier to occur of (y) the last day of the Option Term and (z) the first
anniversary of the date of death, unless the Plan Administrator determines
otherwise.
Also notwithstanding the foregoing, in case of termination of the
Participant's employment or service relationship for Cause, the Option shall
automatically expire upon first notification to the Participant of such
termination, unless the Plan Administrator determines otherwise. If a
Participant's employment or service relationship with the Company is suspended
pending an investigation of whether the Participant shall be terminated for
Cause, all the Participant's rights under any Option likewise shall be suspended
during the period of investigation.
A Participant's transfer of employment or service relationship
between or among the Company and its Related Corporations, or a change in status
from an employee to a consultant, agent, advisor or independent contractor,
shall not be considered a termination of employment or service relationship for
purposes of this Section 7. The effect of a Company-approved leave of absence on
the terms and conditions of an Option shall be determined by the Plan
Administrator, in its sole discretion.
SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS
To the extent required by Section 422 of the Code, Incentive Stock
Options shall be subject to the following additional terms and conditions:
8.1 DOLLAR LIMITATION
To the extent the aggregate Fair Market Value (determined as of
the Grant Date) of Common Stock with respect to which Incentive Stock Options
are exercisable for the first time during any calendar year (under the Plan and
all other stock option plans of the Company)
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exceeds $100,000, such portion in excess of $100,000 shall be treated as a
Nonqualified Stock Option. In the event the Participant holds two or more such
Options that become exercisable for the first time in the same calendar year,
such limitation shall be applied on the basis of the order in which such Options
are granted.
8.2 MORE THAN 10% STOCKHOLDERS
If an individual owns more than 10% of the total voting power of
all classes of the Company's stock, then the exercise price per share of an
Incentive Stock Option shall not be less than 110% of the Fair Market Value of
the Common Stock on the Grant Date and the Option Term shall not exceed five
years. The determination of more than 10% ownership shall be made in accordance
with Section 422 of the Code.
8.3 ELIGIBLE EMPLOYEES
Individuals who are not employees of the Company or one of its
parent corporations or subsidiary corporations may not be granted Incentive
Stock Options. For purposes of this Section 8.3, "parent corporation" and
"subsidiary corporation" shall have the meanings attributed to those terms for
purposes of Section 422 of the Code.
8.4 TERM
Subject to Section 8.2, the Option Term shall not exceed ten
years.
8.5 EXERCISABILITY
An Option designated as an Incentive Stock Option shall cease to
qualify for favorable tax treatment as an Incentive Stock Option to the extent
it is exercised (if permitted by the terms of the Option) (a) more than three
months after the Termination Date for reasons other than death or Disability,
(b) more than one year after the Termination Date by reason of Disability, or
(c) after the Participant has been on leave of absence for more than 90 days,
unless the Participant's reemployment rights are guaranteed by statute or
contract.
For purposes of this Section 8.5, Disability shall mean
"disability" as that term is defined for purposes of Section 422 of the Code.
8.6 TAXATION OF INCENTIVE STOCK OPTIONS
In order to obtain certain tax benefits afforded to Incentive
Stock Options under Section 422 of the Code, the Participant must hold the
shares issued upon the exercise of an Incentive Stock Option for two years after
the Grant Date and one year from the date of exercise. A Participant may be
subject to the alternative minimum tax at the time of exercise of an Incentive
Stock Option. The Participant shall give the Company prompt notice of any
disposition of shares acquired by the exercise of an Incentive Stock Option
prior to the expiration of such holding periods.
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8.7 PROMISSORY NOTES
The amount of any promissory note delivered pursuant to Section
7.5 in connection with an Incentive Stock Option shall bear interest at a rate
specified by the Plan Administrator, but in no case less than the rate required
to avoid imputation of interest (taking into account any exceptions to the
imputed interest rules) for federal income tax purposes.
SECTION 9. STOCK AWARDS
9.1 GRANT OF STOCK AWARDS
The Plan Administrator is authorized to make Awards of Common
Stock or Awards denominated in units of Common Stock on such terms and
conditions and subject to such restrictions, if any (which may be based on
continuous service with the Company or the achievement of performance goals), as
the Plan Administrator shall determine, in its sole discretion, which terms,
conditions and restrictions shall be set forth in the instrument evidencing the
Award. The terms, conditions and restrictions that the Plan Administrator shall
have the power to determine shall include, without limitation, the manner in
which shares subject to Stock Awards are held during the periods they are
subject to restrictions and the circumstances under which forfeiture of the
Stock Award shall occur by reason of termination of the Participant's employment
or service relationship.
9.2 ISSUANCE OF SHARES
Upon the satisfaction of any terms, conditions and restrictions
prescribed in respect to a Stock Award, or upon the Participant's release from
any terms, conditions and restrictions of a Stock Award, as determined by the
Plan Administrator, the Company shall release, as soon as practicable, to the
Participant or, in the case of the Participant's death, to the personal
representative of the Participant's estate or as the appropriate court directs,
the appropriate number of shares of Common Stock.
9.3 WAIVER OF RESTRICTIONS
Notwithstanding any other provisions of the Plan, the Plan
Administrator may, in its sole discretion, waive the forfeiture period and any
other terms, conditions or restrictions on any Stock Award under such
circumstances and subject to such terms and conditions as the Plan Administrator
shall deem appropriate.
SECTION 10. WITHHOLDING
The Company may require the Participant to pay to the Company the
amount of any withholding taxes that the Company is required to withhold with
respect to the grant, vesting or exercise of any Award. Subject to the Plan and
applicable law, the Plan Administrator may, in its sole discretion, permit the
Participant to satisfy withholding obligations, in whole or in part, (a) by
paying cash, (b) by electing to have the Company withhold shares of Common Stock
(up to the minimum required federal tax withholding rate) or (c) by transferring
to the Company
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shares of Common Stock (already owned by the Participant for the period
necessary to avoid a charge to the Company's earnings for financial reporting
purposes), in such amounts as are equivalent to the Fair Market Value of the
withholding obligation. The Company shall have the right to withhold from any
Award or any shares of Common Stock issuable pursuant to an Award or from any
cash amounts otherwise due or to become due from the Company to the Participant
an amount equal to such taxes. The Company may also deduct from any Award any
other amounts due from the Participant to the Company or a Related Corporation.
SECTION 11. ASSIGNABILITY
Awards granted under the Plan and any interest therein may not be
assigned, pledged or transferred by the Participant and may not be made subject
to attachment or similar proceedings otherwise than by will or by the applicable
laws of descent and distribution, and, during the Participant's lifetime, such
Awards may be exercised only by the Participant. Notwithstanding the foregoing,
and to the extent permitted by Section 422 of the Code, the Plan Administrator,
in its sole discretion, may permit such assignment, transfer and exercisability
and may permit a Participant to designate a beneficiary who may exercise the
Award or receive compensation under the Award after the Participant's death;
provided, however, that any Award so assigned or transferred shall be subject to
all the same terms and conditions contained in the instrument evidencing the
Award.
SECTION 12. ADJUSTMENTS
12.1 ADJUSTMENT OF SHARES
In the event that, at any time or from time to time, a stock
dividend, stock split, spin-off, combination or exchange of shares,
recapitalization, merger, consolidation, distribution to stockholders other than
a normal cash dividend, or other change in the Company's corporate or capital
structure results in (a) the outstanding shares, or any securities exchanged
therefor or received in their place, being exchanged for a different number or
class of securities of the Company or of any other corporation or (b) new,
different or additional securities of the Company or of any other corporation
being received by the holders of shares of Common Stock of the Company, then the
Plan Administrator shall make proportional adjustments in (i) the maximum number
and kind of securities subject to the Plan as set forth in Section 4.1 and (ii)
the number and kind of securities that are subject to any outstanding Award and
the per share price of such securities, without any change in the aggregate
price to be paid therefor. The determination by the Plan Administrator as to the
terms of any of the foregoing adjustments shall be conclusive and binding.
Notwithstanding the foregoing, a dissolution or liquidation of the Company or a
Corporate Transaction shall not be governed by this Section 12.1 but shall be
governed by Sections 12.2 and 12.3, respectively.
12.2 DISSOLUTION OR LIQUIDATION
In the event of the proposed dissolution or liquidation of the
Company, the Plan Administrator shall notify each Participant as soon as
practicable prior to the effective date of such proposed transaction. The Plan
Administrator in its discretion may permit a Participant
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to exercise an Option until ten days prior to such transaction with respect to
all vested and exercisable shares of Common Stock covered thereby and with
respect to such number of unvested shares as the Plan Administrator shall
determine. In addition, the Plan Administrator may provide that any forfeiture
provision or Company repurchase option applicable to any Award shall lapse as to
such number of shares as the Plan Administrator shall determine, contingent upon
the occurrence of the proposed dissolution or liquidation at the time and in the
manner contemplated. To the extent an Option has not been previously exercised,
the Option shall terminate automatically immediately prior to the consummation
of the proposed action. To the extent a forfeiture provision applicable to a
Stock Award has not been waived by the Plan Administrator, the Stock Award shall
be forfeited automatically immediately prior to the consummation of the proposed
action.
12.3 CORPORATE TRANSACTION
(a) DEFINITION
"CORPORATE TRANSACTION" means any of the following events:
(i) Consummation of any merger or consolidation of the
Company with or into another corporation; or
(ii) Consummation of any sale, lease, exchange or other
transfer in one transaction or a series of related transactions of all or
substantially all the Company's outstanding securities or substantially all the
Company's assets other than a transfer of the Company's assets to a
majority-owned subsidiary corporation (as defined in Section 8.3) of the
Company.
(b) OPTIONS
In the event of a Corporate Transaction, except as otherwise
provided in the instrument evidencing the Award, each outstanding Option shall
be assumed or continued or an equivalent option or right substituted by the
surviving corporation, the successor corporation or its parent corporation, as
applicable (the "Successor Corporation"). In the event that the Successor
Corporation refuses to assume, continue or substitute for the Option, the
Participant shall fully vest in and have the right to exercise the Option as to
all of the shares of Common Stock subject thereto, including shares as to which
the Option would not otherwise be vested or exercisable. If an Option will
become fully vested and exercisable in lieu of assumption or substitution in the
event of a Corporate Transaction, the Plan Administrator shall notify the
Participant in writing or electronically that the Option shall be fully vested
and exercisable for a specified time period after the date of such notice, and
the Option shall terminate upon the expiration of such period, in each case
conditioned on the consummation of the Corporate Transaction. For the purposes
of this Section 12.3, the Option shall be considered assumed if, following the
Corporate Transaction, the option or right confers the right to purchase or
receive, for each share of Common Stock subject to the Option, immediately prior
to the Corporate Transaction, the consideration (whether stock, cash, or other
securities or property) received in the Corporate Transaction by holders of
Common Stock for each share held on the effective date of the transaction (and
if holders were offered a choice of consideration, the type of consideration
chosen by the holders of a majority of the outstanding shares); provided,
however,
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that if such consideration received in the Corporate Transaction is not solely
common stock of the Successor Corporation, the Plan Administrator may, with the
consent of the Successor Corporation, provide for the consideration to be
received upon the exercise of the Option, for each share of Common Stock subject
thereto, to be solely common stock of the Successor Corporation equal in fair
market value to the per share consideration received by holders of Common Stock
in the Corporate Transaction. All Options shall terminate and cease to remain
outstanding immediately following the consummation of the Corporate Transaction,
except to the extent assumed by the Successor Corporation.
(c) STOCK AWARDS
In the event of a Corporate Transaction, except as otherwise
provided in the instrument evidencing the Award, the vesting of shares subject
to Stock Awards shall accelerate, and the forfeiture provisions to which such
shares are subject shall lapse, if and to the same extent that the vesting of
outstanding Options accelerates in connection with the Corporate Transaction. If
unvested Options are to be assumed, continued or substituted by a Successor
Corporation without acceleration upon the occurrence of a Corporate Transaction,
the forfeiture provisions to which such Stock Awards are subject shall continue
with respect to shares of the Successor Corporation that may be issued in
exchange for such shares.
12.4 FURTHER ADJUSTMENT OF AWARDS
Subject to Sections 12.2 and 12.3, the Plan Administrator shall
have the discretion, exercisable at any time before a sale, merger,
consolidation, reorganization, liquidation or change in control of the Company,
as defined by the Plan Administrator, to take such further action as it
determines to be necessary or advisable, and fair and equitable to the
Participants, with respect to Awards. Such authorized action may include (but
shall not be limited to) establishing, amending or waiving the type, terms,
conditions or duration of, or restrictions on, Awards so as to provide for
earlier, later, extended or additional time for exercise, lifting restrictions
and other modifications, and the Plan Administrator may take such actions with
respect to all Participants, to certain categories of Participants or only to
individual Participants. The Plan Administrator may take such action before or
after granting Awards to which the action relates and before or after any public
announcement with respect to such sale, merger, consolidation, reorganization,
liquidation or change in control that is the reason for such action.
12.5 LIMITATIONS
The grant of Awards shall in no way affect the Company's right to
adjust, reclassify, reorganize or otherwise change its capital or business
structure or to merge, consolidate, dissolve, liquidate or sell or transfer all
or any part of its business or assets.
12.6 FRACTIONAL SHARES
In the event of any adjustment in the number of shares covered by
any Award, each such Award shall cover only the number of full shares resulting
from such adjustment.
13.
<PAGE> 14
SECTION 13. AMENDMENT AND TERMINATION OF PLAN
13.1 AMENDMENT OF PLAN
The Plan may be amended only by the Board in such respects as it
shall deem advisable; provided, however, that to the extent required for
compliance with Section 422 of the Code or any applicable law or regulation,
stockholder approval shall be required for any amendment that would (a) increase
the total number of shares available for issuance under the Plan, (b) modify the
class of persons eligible to receive Options, or (c) otherwise require
stockholder approval under any applicable law or regulation. Any amendment made
to the Plan that would constitute a "modification" to Incentive Stock Options
outstanding on the date of such amendment shall not, without the consent of the
Participant, be applicable to such outstanding Incentive Stock Options but shall
have prospective effect only.
13.2 TERMINATION OF PLAN
The Board may suspend or terminate the Plan at any time. Unless
sooner terminated as provided herein, the Plan shall terminate ten years after
the earlier of the Plan's adoption by the Board and approval by the
stockholders.
13.3 CONSENT OF PARTICIPANT
The amendment or termination of the Plan or the amendment of an
outstanding Award shall not, without the Participant's consent, impair or
diminish any rights or obligations under any Award theretofore granted to the
Participant under the Plan. Any change or adjustment to an outstanding Incentive
Stock Option shall not, without the consent of the Participant, be made in a
manner so as to constitute a "modification" that would cause such Incentive
Stock Option to fail to continue to qualify as an Incentive Stock Option.
Notwithstanding the foregoing, any adjustments made pursuant to Section 12 shall
not be subject to these restrictions.
SECTION 14. GENERAL
14.1 EVIDENCE OF AWARDS
Awards granted under the Plan shall be evidenced by a written
instrument that shall contain such terms, conditions, limitations and
restrictions as the Plan Administrator shall deem advisable and that are not
inconsistent with the Plan.
14.2 NO INDIVIDUAL RIGHTS
Nothing in the Plan or any Award granted under the Plan shall be
deemed to constitute an employment contract or confer or be deemed to confer on
any Participant any right to continue in the employ of, or to continue any other
relationship with, the Company or any Related Corporation or limit in any way
the right of the Company or any Related Corporation to terminate a Participant's
employment or other relationship at any time, with or without Cause.
14.
<PAGE> 15
14.3 REGISTRATION
Notwithstanding any other provision of the Plan, the Company shall
have no obligation to issue or deliver any shares of Common Stock under the Plan
or make any other distribution of benefits under the Plan unless such issuance,
delivery or distribution would comply with all applicable laws (including,
without limitation, the requirements of the Securities Act), and the applicable
requirements of any securities exchange or similar entity.
The Company shall be under no obligation to any Participant to
register for offering or resale or to qualify for exemption under the Securities
Act, or to register or qualify under state securities laws, any shares of Common
Stock, security or interest in a security paid or issued under, or created by,
the Plan, or to continue in effect any such registrations or qualifications if
made. The Company may issue certificates for shares with such legends and
subject to such restrictions on transfer and stop-transfer instructions as
counsel for the Company deems necessary or desirable for compliance by the
Company with federal and state securities laws.
To the extent that the Plan or any instrument evidencing an Award
provides for issuance of stock certificates to reflect the issuance of shares of
Common Stock, the issuance may be effected on a noncertificated basis, to the
extent not prohibited by applicable law or the applicable rules of any stock
exchange.
14.4 NO RIGHTS AS A STOCKHOLDER
No Option or Stock Award denominated in units shall entitle the
Participant to any cash dividend, voting or other right of a stockholder unless
and until the date of issuance under the Plan of the shares that are the subject
of such Award.
14.5 COMPLIANCE WITH LAWS AND REGULATIONS
Notwithstanding anything in the Plan to the contrary, the Plan
Administrator, in its sole discretion, may bifurcate the Plan so as to restrict,
limit or condition the use of any provision of the Plan to Participants who are
officers or directors subject to Section 16 of the Exchange Act without so
restricting, limiting or conditioning the Plan with respect to other
Participants. Additionally, in interpreting and applying the provisions of the
Plan, any Option granted as an Incentive Stock Option pursuant to the Plan
shall, to the extent permitted by law, be construed as an "incentive stock
option" within the meaning of Section 422 of the Code.
14.6 PARTICIPANTS IN FOREIGN COUNTRIES
The Plan Administrator shall have the authority to adopt such
modifications, procedures and subplans as may be necessary or desirable to
comply with provisions of the laws of foreign countries in which the Company or
its Related Corporations may operate to assure the viability of the benefits
from Awards granted to Participants employed in such countries and to meet the
objectives of the Plan.
15.
<PAGE> 16
14.7 NO TRUST OR FUND
The Plan is intended to constitute an "unfunded" plan. Nothing
contained herein shall require the Company to segregate any monies or other
property, or shares of Common Stock, or to create any trusts, or to make any
special deposits for any immediate or deferred amounts payable to any
Participant, and no Participant shall have any rights that are greater than
those of a general unsecured creditor of the Company.
14.8 SEVERABILITY
If any provision of the Plan or any Award is determined to be
invalid, illegal or unenforceable in any jurisdiction, or as to any person, or
would disqualify the Plan or any Award under any law deemed applicable by the
Plan Administrator, such provision shall be construed or deemed amended to
conform to applicable laws, or, if it cannot be so construed or deemed amended
without, in the Plan Administrator's determination, materially altering the
intent of the Plan or the Award, such provision shall be stricken as to such
jurisdiction, person or Award, and the remainder of the Plan and any such Award
shall remain in full force and effect.
14.9 CHOICE OF LAW
The Plan and all determinations made and actions taken pursuant
hereto, to the extent not otherwise governed by the laws of the United States,
shall be governed by the laws of the State of California without giving effect
to principles of conflicts of laws.
SECTION 15. EFFECTIVE DATE
The Effective Date is the date on which the Plan is adopted by the
Board, so long as it is approved by the Company's stockholders at any time
within 12 months of such adoption.
16.
<PAGE> 17
PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS
SUMMARY PAGE
<TABLE>
<CAPTION>
SECTION/EFFECT OF DATE OF STOCKHOLDER
DATE OF BOARD ACTION ACTION AMENDMENT APPROVAL
<S> <C> <C> <C>
March 21, 2000 Initial Plan Adoption March 26, 2000
</TABLE>
