Exhibit 10.2
FIRST HORIZON PHARMACEUTICAL CORPORATION
1997 NON-QUALIFIED STOCK OPTION PLAN
1. Purposes of the Plan: The purposes of this Stock Plan are:
* to attract and retain the best available personnel for positions of
substantial responsibility,
* to provide additional incentive to Employees, and to promote the
success of the Company's business.
* to promote the success of the Company's business.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees as shall be
administering the Plan, in accordance with Section 4 of the Plan.
(b) "Applicable Laws" means the legal requirements relating to the
administration of stock option plans under state corporate and securities laws
and the Code.
(c) "Code" means the Board of Directors of the Company.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Committee" means a Committee appointed by the Board in accordance with
Section 4 of the Plan.
(g) "Common Stock" means the Common Stock of the Company.
(h) "Company" means Horizon Pharmaceutical Corporation, a Delaware
corporation.
(i) "Continuous Status as an Employee" means that the employment
relationship with the Company, any Parent, or Subsidiary, is not interrupted or
terminated. Continuous Status as an Employee shall not be considered interrupted
in the case of (i) any leave of absence approved by the Company or (ii)
transfers between locations of the Company or between the Company, any Parent,
any Subsidiary, or any successor. A leave of absence approved by the Company
shall include sick leave, military leave, or any other personal leave approved
by an authorized representative of the Company.
(j) "Director" means a member of the Board.
(k) "Disability" means total and permanent disability as defined in the
Company's long-term disability plan or, in the event the Company does not have a
long-term disability plan, as defined in Section 22(e)(3) of the Code.
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(l) `Employee' means any person, including Officers and Directors, employed
by the Company or any Parent or Subsidiary of the Company. Neither service as a
Director nor payment of a director's fee by the Company shall be solely
sufficient to constitute "employment" by the Company.
(m) "Exchange Ace' means the Securities Exchange Act of 1934, as amended.
(n) "Fair Market Value" means, as of any date, the value of Common Stock
determined as follows:
(i) If the Common Stock is listed on any established stock exchange or
a national market system, including without limitation the Nasdaq National
Market of the National Association of Securities Dealers, Inc. Automated
Quotation "NASDAQ") System, the Fair Market Value of a Share of Common Stock
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on such system or exchange (or the exchange with the
greatest volume of trading in Common Stock) on the last market trading day prior
to the day of determination, as reported in The Wall Street Journal or such
other source as the Administrator deems reliable;
(ii) If the Common Stock is quoted on the NASDAQ System (but not on
the Nasdaq National Market thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;
(iii) In the absence of an established market for the Common Stock,
the Fair Market Value shall be determined in good faith by the Administrator.
(o) "Notice of Grant" means a written notice evidencing certain terms and
conditions of an individual Option grant. The Notice of Grant is part of the
Option Agreement.
(p) "Officer"' means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
(q) "Option" means a stock option granted pursuant to the Plan.
(r) "Option Agreement" means a written agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.
(s) "Option Exchange Program" means a Program whereby outstanding options
are surrendered in exchange for options with a lower exercise price.
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(t) "Optioned Stock" or "Option Shares" means the Common Stock subject to
an Option.
(u) "Optionee" means an Employee who holds an outstanding Option.
(v) "Parent" means a `parent corporation', whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(w) "Plan" means this 1997 Non-Qualified Stock Option Plan.
(x) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor to
Rule 16b-3, as in effect when discretion is being exercised with respect to the
Plan.
(y) "Share" means a share of the Common Stock, as adjusted in accordance
with Section 12 of the Plan.
(z) "Subsidiary" means a `subsidiary corporation', whether now or hereafter
existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 12 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 1,000,000 Shares. The Shares may be authorized, but unissued,
or reacquired Common Stock.
If an Option expires or becomes unexcersisable without having been
exercised in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated); provided,
however, that Shares that have actually been issued under the Plan shall not be
returned to the Plan and shall not become available for future distribution
under the Plan.
4. Administration of the Plan.
(a) Procedure.
(i) Multiple Administrative Bodies. If permitted by Rule 16b-3, if
applicable, the Plan may be administered by different bodies with respect to
Directors, Officers who are not Directors, and Employees who are neither
Directors nor Officers.
(ii) Administration with Respect to Directors and Officers Subject to
Section 16(b). With respect to Option grants made to Employees who are also
Officers or Directors subject to Section 16(b) of the Exchange Act, the Plan
shall be administered by (A) the Board, if the Board may administer the Plan in
compliance with the rules governing a plan intended to qualify as a
discretionary plan under Rule 16b-3, or (B) a committee designated by the Board
to administer the Plan, which committee shall be constituted to comply with the
rules governing a plan intended to qualify as a discretionary plan under Rule
16b-3. Once appointed, such Committee shall continue to serve in its designated
capacity until otherwise directed by the Board. From time to time the Board may
increase the size of the Committee and appoint additional members, remove
members (with or without cause) and
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substitute new members, fill vacancies (however caused), and remove all members
of the Committee and thereafter directly administer the Plan, all to the extent
permitted by the rules governing a plan intended to qualify as a discretionary
plan under Rule 16b-3.
(iii)Administration with Respect to Directors and Officers Not Subject
to Section 16(b) and with Respect to Other Persons. With respect to Option
grants made to Directors and Officers not subject to Section 16(b) and with
respect to Option grants made to Employees who are neither Directors nor
Officers of the Company, the Plan shall be administered by (A) the Board or (B)
a committee designated by the Board, which committee shall be constituted to
satisfy Applicable Laws. Once appointed, such Committee shall serve in its
designated capacity until otherwise directed by the Board. The Board may
increase the size of the Committee and appoint additional members, remove
members (with or without cause) and substitute new members, fill vacancies
(however caused), and remove all members of the Committee and thereafter
directly administer the Plan, all to the extent permitted by Applicable Laws.
(b) Powers of the Administrator. Subject to the provisions of the Plan, and
in the case of a Committee, subject to the specific duties delegated by the
Board to such Committee, the Administrator shall have authority, in its
discretion:
(i) to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(m) of the Plan;
(ii) to select the Employees to whom Options may be granted hereunder;
(iii) to determine whether and to what extent Options are granted
hereunder;
(iv) to determine the number of shares of Common Stock to be covered
by each Option granted hereunder,
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any award granted hereunder. Such terms and conditions
include, but are not limited to, the exercise price, the time or times when
Options may be exercised (which may be based on performance criteria), any
vesting acceleration or waiver of forfeiture restrictions, any right to
repurchase Option Shares by the Company, and any restriction or limitation
regarding any Option or the shares of Common Stock relating thereto, based in
each case on such factors as the Administrator, in its sole discretion, shall
determine;
(vii) to reduce the exercise price of any Option to the then current
Fair Market Value if the Fair Market Value of the Common Stock covered by such
Option shall have declined since the date the Option was granted;
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(viii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;
(ix) to prescribe, amend and rescind rules and regulations relating to
the Plan, including rules and regulations relating to sub-plans established for
the purpose of qualifying for preferred tax treatment under foreign tax laws;
(x) to modify or amend each Option (subject to Section 14(c) of the
Plan), including the discretionary authority to extend the post-termination
exercisability period of Options longer than is otherwise provided for in the
Plan;
(xi) to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Option previously granted by the
Administrator;
(xii) to institute an Option Exchange Program;
(xiii) to determine the terms and restrictions applicable to Options;
and
(xiv) to make all other determinations deemed necessary or advisable
for administering the Plan.
(c) Effect of Administrator's Decision. The Administrator's decisions,
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options.
5. Eligibility. Options may be granted to Employees as provided in Section 21 of
the Plan. If otherwise eligible, an Employee who has been granted an Option may
be granted additional Options.
6. Limitations.
(a) Each Option shall be designated in the Notice of Grant.
(b) Neither the Plan nor any Option shall confer upon an Optionee any right
with respect to continuing the Optionee's employment with the Company, nor shall
they interfere in any way with the Optionee's right or the Company's right to
terminate such employment at any time, with or without cause.
(c) The following limitations shall apply to grants of Options to
Employees:
(i) The foregoing limitations shall be adjusted proportionately in
connection with any change in the Company's capitalization as described in
Section 12.
(ii) If an Option is canceled in the same fiscal year of the Company
in which it was granted (other than in connection with a transaction described
in Section 12), the canceled Option will be counted against the limit set forth
in Section 6(c)(i). For this purpose, if the exercise price of an Option is
reduced, the transaction will be treated as a cancellation of the Option and the
grant of a new Option.
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7. Term of Plan. Subject to Section 18 of the Plan, the Plan shall become
effective upon the earlier to occur of its adoption by the Board or its approval
by the shareholders of the Company as described in Section 18 of the Plan. It
shall continue in effect for a term of ten (10) years unless terminated earlier
under Section 14 of the Plan.
8. Term of Option. The term of each Option shall be stated in the Notice of
Grant.
9. Option Exercise Price and Consideration.
(a) Exercise Price. The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be determined by the
Administrator.
(b) Waiting Period and Exercise Dates. At the time an Option is granted,
the Administrator shall fix the period within which the Option may be exercised
and shall determine any conditions which must be satisfied before the Option may
be exercised. In so doing, the Administrator may specify that an Option may not
be exercised until the completion of a service period
(c) Form of Consideration. The Administrator shall determine the acceptable
form of consideration for exercising an Option, including the method of payment.
Such consideration may consist entirely of:
(i) cash,
(ii) check;
(iii) other Shares which (A) in the case of Shares acquired upon
exercise of an Option, have been owned by the Optionee for more than six (6)
months on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;
(iv) delivery of a properly executed exercise notice together with
such other documentation as the Administrator and the broker, if applicable,
shall require to effect an exercise of the Option and delivery to the Company of
the sale or loan proceeds required to pay the exercise price;
(v) a reduction in the amount of any Company liability to the
Optionee, including any liability attributable to the Optionee's participation
in any Company-sponsored deferred compensation program or arrangement;
(vi) any combination of the foregoing methods of payment; or
(vii) such other consideration and method of payment for the issuance
of Shares to the extent permitted by Applicable Laws.
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10. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted
hereunder shall be exercisable according to the terms of the Plan and at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed exercised when the Company receives: (i) written
notice of exercise (in accordance with the Option Agreement) from the person
entitled to exercise the Option, and (ii) full payment for the Shares with
respect to which the Option is exercised. Full payment may consist of any
consideration and method of payment authorized by the Administrator and
permitted by the Option Agreement and the Plan. Shares issued upon exercise of
an Option shall be issued in the name of the Optionee. Until the stock
certificate evidencing such Shares is issued (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized transfer agent of the
Company), no rights to vote or receive dividends or any other rights as a
shareholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly after the Option is exercised. No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 12 of the
Plan.
Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is exercised.
(b) Termination of Employment.
Unless otherwise specified by the Administrator in writing at or subsequent
to the grant, upon termination of employment for any reason other than upon the
Optionee's Disability, death or retirement at or after age 65, the Option shall
terminate and the Optionee's right to exercise any Option shall end immediately
upon the termination of employment. For purposes of this Section 10(b),
"termination of employment" shall be deemed to have occurred at the close of
business on the last day on which the Optionee is carried as an active employee
on the records of the Company.
If the Optionee is given the right in writing to exercise such Option for a
specified period of time following termination of employment, the Optionee may
exercise such Option, but only within such period of time as is specified in
such writing, and only to the extent that the Optionee was entitled to exercise
it at the date of termination of employment (but in no event later than the
expiration of the term of such Option as set forth in the Notice of Grant). If,
at the date of termination of employment , the Optionee is not entitled to
exercise the entire Option, the Shares covered by the unexercisable portion of
the Option shall revert to the Plan. If, after termination of employment, the
Optionee does not exercise the Option within the time specified, the Option
shall terminate, and the Shares covered by such Option shall revert to the Plan.
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(c) Disability of Optionee. In the event that an Optionee's Continuous
Status as an Employee terminates as a result of the Optionee's Disability, the
Optionee may exercise the Option at any time within twelve (12) months from the
date of such termination, but only to the extent that the Optionee was entitled
to exercise it at the date of such termination (but in no event later than the
expiration of the term of such Option as set forth in the Notice of Grant). If,
at the date of termination, the Optionee is not entitled to exercise the entire
Option, the Shares covered by the unexercisable portion of the Option shall
revert to the Plan. If, after termination, the Optionee does not exercise the
Option within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
(d) Death of Optionee. In the event of death of an Optionee, the Option may
be exercised at any time within twelve (12) months following the date of death
(but in no event later than the expiration of the term of such Option as set
forth in the Notice of Grant), by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only
the extent that the Optionee was entitled to exercise the Option at the date of
death. If, at the time of death, the Optionee was not entitled to exercise the
entire Option, the Shares covered by the unexercisable portion of the Option
shall immediately revert to the Plan. If, after death, the Optionee's estate or
a person who acquired the right to exercise the Option by bequest or inheritance
does not exercise the Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
(e) Rule 16b-3. Options granted to individual subject to Section 16 of the
Exchange Act ("Insiders") must comply with the applicable provisions of Rule
16b-3 and shall contain such additional conditions or restrictions as may be
required thereunder to qualify for the maximum exemption from Section 16 of the
Exchange Act with respect to Plan transactions.
(f) Retirement At or After Age 65. Upon retirement from the Company at or
after age 65, the Option may be exercised by the retired Employee at any time
during the Option's term as set forth in the Notice of Grant. In the event of
the death of such retired Employee prior to the expiration of the term of such
Option as set forth in the Notice of Grant, the provisions of Paragraph (d) of
this Section 10 shall apply.
11. Non-Transferability of Options. An Option may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee.
12. Adjustments upon Changes in Capitalization, Dissolution, Merger or Asset
Sale.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
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expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, to the extent that an Option has not
been previously exercised, it will terminate immediately prior to the
consummation of such proposed action. The Board may, in the exercise of its sole
discretion in such instances, declare that any Option shall terminate as of a
date fixed by the Board and give each Optionee the right to exercise the Option
as to all or any part of the Optioned Stock, including Shares as to which the
Option would not otherwise be exercisable.
(c) Merger, Reorganization or Asset Sale. "For purposes of this Section 12,
"Reorganization of the Company" shall mean a merger of the Company with or into
another corporation, a reorganization or consolidation in which the Company is
not the surviving or acquiring company, a sale of securities of the Company
whereby the Company becomes a wholly-owned subsidiary of another company, or the
sale of substantially all of the assets of the Company. In the event of a
Reorganization of the Company, each outstanding Option may be assumed or an
equivalent option or right may be substituted by the successor corporation or a
Parent of the successor corporation. For purposes of this paragraph, the term
"successor corporation" shall include the acquiring company, the purchaser of
substantially all of the assets of the Company, and any successor company in a
merger, reorganization or consolidation, as the case may be. In the event each
outstanding Option is not so assumed or any equivalent option or right not so
substituted, then (i) any vesting period shall end and any unvested Options
shall become immediately exercisable, and (ii) the Administrator shall notify
the Optionee that the Option shall be fully exercisable to the extent not
exercised for a period of twenty (20) days from the date such notice is given,
and the Option will terminate upon the expiration of such period. For the
purposes of this paragraph, the Option shall be considered assumed if, following
the Reorganization of the Company, the option confers the right to purchase, for
each Share of Optioned Stock subject to the Option immediately prior to the
Reorganization of the Company, the consideration (whether stock, cash or other
securities or property) received in the Reorganization of the Company 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, that if such consideration received in the Reorganization of
the Company was not solely common stock of the successor corporation or its
Parent, the 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 Optioned Stock subject to the Option, to be solely common
stock of the successor corporation or its Parent equal in fair market value to
the per share consideration received by holders of Common Stock in the
Reorganization of the Company.
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13. Date of Grant. The date of grant of an Option shall be, for all purposes,
the date on which the Administrator makes the determination granting such
Option, or such other later date as is determined by the Administrator. Notice
of the determination shall be provided to each Optionee within a reasonable time
after the date of such grant.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend, alter,
suspend or terminate the Plan, except the following amendments shall require
majority shareholder approval:
(i) increase in the total number of shares subject to the Plan, except
under Section 12 of the Plan relating to Adjustments; or
(ii) change in the term of the Plan set forth in Section 7 hereof.
(b) Shareholder Approval. The Company shall obtain shareholder approval of
any Plan amendment to the extent necessary and desirable to comply with Rule
16b-3 (or any successor rule or statute or other applicable law, rule or
regulation, including the requirements of any exchange or quotation system on
which the Common Stock is listed or quoted). Such shareholder approval, if
required, shall be obtained in such a manner and to such a degree as is required
by the applicable law, rule or regulation.
(c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
15. Conditions upon Issuance of Shares.
(a) Legal Compliance. Shares shall not be issued pursuant to the exercise
of an Option unless the exercise of such Option and the issuance and delivery of
such Shares shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules
and regulations promulgated thereunder, Applicable Laws, and the requirements of
any stock exchange or quotation system upon which the Shares may then be listed
or quoted, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
(b) Investment Representations. As a condition to the exercise of an
Option, the Company may require the person exercising such Option to represent
and warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the company, such a representation is
required.
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(c) Restrictions. Restrictions may be imposed on Shares issued pursuant to
an Option and a legend may be stamped or otherwise imprinted on the Share
certificates.
(d) Other Conditions. If the Company determines that listing, registration
or qualification of Shares (or attempt to obtain an exemption therefrom) of any
regulatory body is necessary or desirable, the Option may not be exercised in
whole or in part until such listing, registration, qualification, consent or
approval is effected free of any conditions not acceptable to the Company.
16. Liability of Company.
(a) Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company's counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.
(b) Grants Exceeding Allotted Shares. If the Optioned Stock covered by an
Option exceeds, as of the date of grant, the number of Shares which may be
issued under the Plan without additional shareholder approval, such Option shall
be void with respect to such excess Optioned Stock, unless shareholder approval
of an amendment sufficiently increasing the number of Shares subject to the Plan
is timely obtained in accordance with Section 14 of the Plan.
17. Reservation of Shares. The Company, during the term of this Plan, will at
all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
18. Shareholder Approval. Continuance of the Plan shall be subject to approval
by the shareholders of the Company within twelve (12) months before or after the
date the Plan is adopted. Such shareholder approval shall be obtained in the
manner and to the degree required under applicable Federal and state law. An
Option shall not be exercisable in whole or in part prior to the date of
approval of the Plan by the shareholders of the Company.
19. Exchange Act. At the time of adoption of the Plan, it is not anticipated
that the Company will be subject to the Exchange Act, but provisions relating to
the Exchange Act are included herein to be applicable at such time, if any, as
the Company becomes subject to the Exchange Act.
20. Taxes Withheld. The Company may require, as a condition to the exercise,
that the Optionee pay the Company an amount equal to the amount of the tax the
Company may be required to withhold from compensation or collect from the
Optionee and pay to the applicable taxing authorities.
21. Eligibility for Consideration. Only the following Employees shall be
eligible to be considered to receive grant(s) of Options under the Plan:
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(a) Employees who were in the employment of the Company before January 1,
1996 and who have Continuous Status as an Employee as of the date of grant.
(b) Employees who are employed by the Company on or after January 1, 1996,
upon expiration of twelve (12) months' employment with the Company, and who have
Continuous Status as an Employee as of the date of grant.
22. Determinations of Administrator or Board. All determinations of the
Administrator and the Board in connection with the Plan or Options hereunder
shall be evidenced by minutes or other written documentation setting forth such
determinations.
23. Documentation with Respect to Options. Each Option granted hereunder shall
be evidenced by a written Stock Option Agreement dated as of the date of grant
and executed by the Company and the Optionee, in such form as the Administrator
shall approve from time to time.
24. Temporary or Permanent Suspension of Grant of Options. The Administrator in
its discretion may decide not to grant any Options at any time or from time to
time.
25. No Right to Continued Employment. Nothing in the Plan or in any Option
granted hereunder or in any Stock Option Agreement relating thereto shall confer
upon any Employee the right to continue in the employ of the Company.
26. Other Plans. The adoption of the Plan shall not affect any other stock
option, stock purchase, incentive or other compensation plans in effect for the
Company, nor shall the Plan preclude the Company from establishing any other
plans or forms of incentive or other compensation for Employees.
27. Piggyback Registration.
(a) Registration Rights. If the Company shall take action to register the
Shares under the Securities Act (as then in effect), the Company will give the
holders of the Options acquired pursuant to the Plan, and Shares acquired
pursuant to any Option, written notice of its intention in that regard and use
all reasonable efforts to effect the registration under said Act, if such
registration is permissible, of the Shares available to Optionees pursuant to
unexercised and unexpired Options and Shares acquired by Optionees pursuant to
this Plan (collectively, "Registrable Securities") as may be specified by
written notice from any such Optionees delivered to the Company within fifteen
(15) business days after receipt of the Company's notice of its intention to
register any of its securities.
Nevertheless, if the offering to which the proposed registration statement
relates is to be distributed by or through an underwriter selected by the
Company, each Optionee shall agree either to sell his Shares through such
underwriter on the same terms and conditions as the underwriter agrees to sell
securities on behalf of the Company or to withhold any Shares (whether acquired
before or after the effective date of the registration statement) from the
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market for a period of one hundred twenty (120) days after the effective date of
the registration statement. Furthermore, if a greater number of shares of
Registrable Securities is offered for participation in the proposed underwriting
than can be accommodated without adversely affecting the proposed underwriting
(in the opinion of the managing underwriter proposing to underwrite securities
to be sold by the Company), the Company may elect to reduce the amount of
Registrable Securities proposed to be offered for registration for the accounts
of all persons other than the Company, including the number of shares of
Registrable Securities such Optionee was otherwise entitled to register, to an
aggregate number deemed satisfactory by the managing underwriter.
(b) Cost of Registration. The costs and expenses of registration as
provided herein, including legal fees, special audit fees, printing expenses,
filing fees and premiums for insurance, if any, incurred by the Company in
connection with any Securities Act registration shall be borne entirely by the
Company. The holders of the Registrable Securities who are selling shares of
common stock shall pay only underwriters discounts and commissions in connection
with the sale of their Registrable Securities pursuant to the registration
statements filed.
(c) Indemnification of Company. The obligations of the Company to register
any of the Shares hereunder shall be subject to the condition that each Optionee
agrees in writing to indemnify the Company, its officers and directors, against
all losses, claims, damages and liabilities caused by any untrue statement or
omission based on information furnished in writing by each Optionee to the
Company expressly for use in a registration statement, prospectus or offering
circular.
(d) Termination of Registration Rights. The piggyback registration rights
described in this Section 27 shall terminate as to any portion of the Shares
when:
(i) Such portion of the Shares shall have been effectively registered
under the Securities Act and applicable state securities acts and sold by the
holder thereof in accordance with registration; or
(ii) A written opinion to the effect a registration is not required or
necessary under any federal or applicable state law or regulation shall have
been received from legal counsel for the Company; or
(iii) A "no-action" letter has been received from the Securities and
Exchange Commission and the applicable states to the effect that distribution of
such portion of the Shares without registration will not result in a
recommendation by the staff of the Commission or the respective states to
prosecute a violation of the Securities Act or applicable blue sky law, but only
as to the Shares described in the no-action letter.
28. Miscellaneous.
(a) Whenever used herein, nouns in the singular shall include the plural,
and pronouns shall include the masculine and feminine gender as the meaning
shall require.
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(b) Headings of Sections and Paragraphs hereof are inserted for convenience
of reference only and do not constitute a part of the Plan.
(c) All notices to be given pursuant to the terms of the Plan shall be in
writing. Notices required or permitted to be given under the Plan by the
Administrator or the Company under Sections 12 or 27 of the Plan shall be deemed
to have been given on the date which is five (5) days following deposit of same
in the U.S. mail, registered or certified mail or Express Mail, postage prepaid,
or with a nationally or internationally recognized courier service, prepaid, for
no more than five (5)-day delivery, addressed to the addressee at the last
address shown on the records of the Company.
[END OF PLAN]
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