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Exhibit 99.1
1992 Stock Option Plan
of
Adaptive Broadband Corporation
(As amended through October 25, 2000)
1. PURPOSE.
The purpose of the 1992 Stock Option Plan (the "Plan") is to enable
Adaptive Broadband Corporation (the "Company") and its subsidiaries to attract
and retain officers and other key employees, directors, and consultants and to
provide them with additional incentive to advance the interests of the Company.
Options qualifying as incentive stock options under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), and non-qualified options may be
granted under the Plan.
2. ADMINISTRATION.
(a) The Plan shall be administered by the Board of Directors of the
Company, or by a committee (the "Committee") of two or more directors selected
by the Board. In the Board's discretion, the Committee may consist solely of two
or more outside directors in accordance with Section 162(m) of the Code and/or
solely of two or more non-employee directors in accordance with Rule 16b-3
promulgated under the Securities Exchange Act of 1934, as amended.
(b) The Board of Directors or the Committee shall have the power, subject
to the express provisions of the Plan:
(1) To determine the recipients of options under the Plan, the time
of grant of the options, and the number of shares covered by the grant.
(2) To prescribe the terms and provisions of each option granted
(which need not be identical).
(3) To delegate the powers in Paragraphs 2(b)(1) and 2(b)(2) to
management.
(4) To construe and interpret the Plan and options, to establish,
amend, and revoke rules and regulations for the Plan's administration, and to
make all other determinations necessary or advisable for the administration of
the Plan.
3. SHARES SUBJECT TO THE PLAN.
Subject to the provisions of Paragraph 7 (relating to the adjustment upon
changes in stock), the number of shares which may be sold pursuant to options
granted under the Plan shall not exceed in the aggregate 12,100,000 shares of
Common stock of the Company. Shares sold pursuant to options granted under the
Plan may be unissued shares or reacquired shares.
If any options granted under the Plan shall for any reason terminate or
expire without having been exercised in full, the shares not purchased under
such options shall be available again for the purposes of the Plan.
4. ELIGIBILITY.
(a) Options under this Plan may be granted to officers and other key
employees and consultants of the Company and/or of its subsidiaries, provided
that incentive stock options may be granted hereunder only to officers and other
key employees (including directors who are also officers or employees). No
officer or key employee may receive options under this Plan covering in excess
of 200,000 shares in any fiscal year of the Company (subject to adjustment in
accordance with the provisions of paragraph 7 of the Plan).
(b) No consultant may receive options under this Plan if, at the time of
grant, a Form S-8 Registration Statement ("Form S-8") under the Securities Act
of 1933, as amended (the "Securities Act"), is not available to
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register either the offer or the sale of the Company's securities to such
consultant because of the nature of the services that the consultant is
providing to the Company, or because the consultant is not a natural person, or
as otherwise provided by the rules governing the use of Form S-8, unless the
Company determines both (i) that such grant (A) shall be registered in another
manner under the Securities Act (e.g., on a Form S-3 Registration Statement) or
(B) does not require registration under the Securities Act in order to comply
with the requirements of the Securities Act, if applicable, and (ii) that such
grant complies with the securities laws of all other relevant jurisdictions.
(c) Each director of the Company who is not an employee of the Company
shall receive a non-qualified stock option under the Plan immediately following
each annual meeting of shareholders of the Company. The first option received by
a director under this paragraph 4(c) shall cover 20,000 shares of common stock
of the Company and each option received by a director under this Plan thereafter
shall cover 16,000 shares of common stock, in the case of a director who is a
chair of a committee of the Board of Directors, and 12,000 shares, in the case
of a director who is not. Each such option shall have an exercise price equal to
the fair market value of the common stock of the Company on the date of the
annual meeting of shareholders to which it relates, determined in accordance
with the provisions of paragraph 5(a)(2) of this Plan. The number of options
that directors may receive pursuant to this paragraph 4(c) shall be
appropriately adjusted in accordance with the provisions of paragraph 7 of this
Plan. This paragraph 4(c) shall not be amended more than once every six months,
other than to comply with changes in the Code or the rules or regulations
thereunder.
(d) Persons to whom options to purchase shares are granted are hereinafter
referred to as "optionee(s)."
5. TERMS OF OPTION AGREEMENTS.
(a) Options granted pursuant to the Plan shall be evidenced by agreements
specifying the number of shares covered thereby, in such form as the Board of
Directors or Committee shall from time to time establish, which agreements may
incorporate all or any of the terms hereof by reference and shall comply with
and be subject to the following terms and conditions:
(1) The Board of Directors or Committee or their management
delegatee(s) shall have the power to set the time or times within which each
option shall be exercisable and to at any time accelerate the time or times of
exercise (notwithstanding the terms of the option). Unless the stock option
agreement executed by the optionee expressly otherwise provides, (i) an option
granted to an officer or other key employees or consultant shall become
exercisable on a cumulative basis as to one-quarter of the total number of
shares covered thereby on each of the first, second, third, and fourth
anniversary dates of the date of grant of the option, (ii) an option granted to
a director who is not an employee of the Company shall vest fully on the date of
grant, and (iii) an option shall not be exercisable after the expiration of ten
years from the date of grant.
(2) Except as provided in Paragraph 5(b) below, the exercise price of
any stock option granted under this Plan shall not be less than 100% of the fair
market value of the shares of common stock of the Company on the date of the
granting of the option. The fair market value per share shall be the last sale
price on the day the option is granted as reported on the National Market
System, or, if such stock is not then reported on the National Market System but
quotations are reported on the National Association of Securities Dealers
Automated Quotations System, the average of the bid and asked prices on the day
the option is granted, in either event as such price quotes are listed in The
Wall Street Journal, Western Edition (or if not so reported in The Wall Street
Journal, any other listing service or publication known to the Board of
Directors). If the stock is listed upon an established stock exchange or
exchanges, such fair market value shall be deemed to be the closing price of the
common stock on the largest such stock exchange upon which such stock is listed
on the day the option is granted.
(3) To the extent that the right to purchase shares has accrued
hereunder, options may be exercised from time to time by written notice to the
Company, stating the number of shares being purchased and accompanied by the
payment in full of the option price for such shares. Such payment shall be made
in cash or in shares of the outstanding common stock of the Company which have
been held by the optionee for at least six months or in a combination of cash
and such stock, except that the Board of Directors or the Committee in its sole
discretion may authorize payment by any optionee (for all or part of his or her
purchase price) by a promissory note or such other from of legal consideration
that may be acceptable to the Board or Committee.
If shares of common stock are used in part or full payment for the shares
to be acquired upon exercise of the option, such shares shall be valued for the
purpose of such exchange as of the date of exercise of the option in accordance
with the provisions of Subparagraph (2) above. Any certificates for shares of
outstanding common stock used to pay the option price shall be accompanied by
stock powers duly endorsed in blank by the registered holder of the certificate
(with the signature thereon guaranteed). In the event the certificates tendered
by the optionee in such payment cover more shares than are required for such
payment, the certificates shall also be accompanied by instructions from the
optionee to the Company's transfer agent with regard to disposition of the
balance of the shares covered thereby.
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If payment by promissory note is authorized, the interest rate, term,
repayment schedule and other provisions of such note shall be as specified by
the Board of Directors or the Committee; provided, however, that such note
shall bear interest at a rate not less than the applicable test rate of interest
prescribed by Section 1.483-1(d)(1) of the Treasury Regulations, as in effect at
the time the stock is purchased. The Board of Directors or Committee may require
that the optionee pledge his or her stock to the Company for the purpose of
securing the payment of such note, and the Company may hold the certificate(s)
representing such stock in order to perfect its security interest.
An option may be exercised by a securities broker acting on behalf of an
optionee pursuant to authorization instructions approved by the Company,
provided that the notice of exercise of such option shall be delivered, and the
exercise price of such option shall be paid in full, as specified above.
(4) The Company at all times shall keep available the number of
shares of stock required to satisfy options granted under the Plan.
(5) The Company may require any person to whom an option is granted,
his or her legal representative, heir, legatee, or distributee, as a condition
of exercising any option granted hereunder, to give written assurance
satisfactory to the Company to the effect that such person is acquiring the
shares subject to the option for his or her own account for investment and not
with any present intention of selling or otherwise distributing the same. The
Company reserves the right to place a legend on any share certificate issued
pursuant to this Plan to assure compliance with this paragraph. No shares of
common stock of the Company shall be required to be distributed until the
Company shall have taken such action, if any, as is then required to comply with
the provisions of the Securities Act or any other then applicable securities
law.
(6) Neither a person to whom an option is granted, nor such person's
legal representative, heir, legatee, or distributee, shall be deemed to be the
holder of, or to have any of the rights of a holder with respect to, any shares
subject to such option unless and until such person has exercised his or her
option pursuant to the terms thereof.
(7) Options shall be transferable only by will or by the laws of
descent and distribution, and during the lifetime of the person to whom they are
granted such person alone may exercise them.
(8) An option granted to an employee or director shall terminate and
may not be exercised if the person to whom it is granted ceases to be employed
by the Company or by a subsidiary of the Company, or ceases to be a director
(unless such person continues as an employee), with the following exceptions:
(i) If the employment or directorship is terminated for any
reason other than the person's death or disability, he or she may at any time
within not more than three months after such termination exercise the option,
but only to the extent that it was exercisable by such person on the date of
such termination, or
(ii) If such person dies or becomes disabled while in the employ
of the Company or of a subsidiary, or while a director, his or her option may be
exercised by his or her personal representatives, heirs or legatees at any time
within not more than twelve (12) months following the date of death or
disability, but only to the extent such option was exercisable by such person on
the date of death or disability.
An option granted to a consultant shall terminate in accordance with the
terms specified in the option.
(9) In no event may an option be exercised by anyone after the
expiration of the term of the option established pursuant to Subparagraph
5(a)(1) hereof.
(10) Each option granted pursuant to this Plan shall specify whether
it is a non-qualified or an incentive stock option, provided that the Board of
Directors or Committee may give the optionee the right to elect to receive
either an incentive or a non-qualified stock option.
(11) An option granted pursuant to this Plan may have such other terms
as the Board of Directors or Committee in its discretion may deem necessary or
appropriate and shares issued upon exercise of any option hereunder may be
subject to such restrictions as the Board of Directors or Committee deems
appropriate.
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(b) In addition to the terms and conditions specified above, incentive
stock options granted under this Plan shall be subject to the following terms
and conditions:
(1) The aggregate fair market value (determined as of the time the
option is granted) of the stock with respect to which incentive stock options
are exercisable for the first time by any optionee during any calendar year
(under all option plans of the Company or its parent and subsidiary
corporations) shall not exceed $100,000.
(2) As to individuals otherwise eligible under this Plan who own more
than 10 percent of the total combined voting power of all classes of stock of
the Company and its parent and subsidiary corporations, an incentive option can
be granted under this Plan to any such individual only if at the time such
option is granted the option price is at least 110 percent of the fair market
value of the stock subject to the option and such option by its terms is not
exercisable after the expiration of five years from the date such option is
granted.
6. USE OF PROCEEDS FROM SHARES.
Proceeds from the sale of Shares pursuant to options granted under the Plan
shall be used for general corporate purposes.
7. ADJUSTMENT UPON CHANGES IN SHARES.
(a) If any change is made in the shares subject to the Plan, or subject to
any option granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or otherwise), appropriate adjustments
shall be made by the Board of Directors or Committee in the maximum number of
shares subject to the Plan and the number of shares and price per share of stock
subject to outstanding options.
(b) Other than in the case of a reincorporation of the Company in another
state, in the event of (i) dissolution or liquidation of the Company, (ii) a
transaction in which more than 50 percent of the shares of the Company that are
entitled to vote are exchanged, or (iii) any merger or consolidation or other
reorganization in which the Company is not the surviving corporation (or in
which the Company becomes a subsidiary of another corporation), outstanding
options under this Plan shall become fully exercisable immediately prior to any
such event.
8. RIGHTS AS AN EMPLOYEE.
Nothing in this Plan or in any options awarded hereunder shall confer upon
any employee any right to continue in the employ of the Company or of any of its
subsidiaries or interfere in any way with the right of the Company or any such
subsidiary to terminate such employee's employment at any time.
9. WITHHOLDING TAX.
There shall be deducted from the compensation of any employee holding
options under this Plan the amount of any tax required by any governmental
authority to be withheld and paid over by the Company to such governmental
authority for the account of the person with respect to such options. To the
extent provided in the stock option agreement executed by the optionee, the
optionee may satisfy any federal, state or local tax withholding obligation
arising with respect to the exercise of an option by authorizing the Company to
withhold shares of stock otherwise issuable to the optionee as a result of the
exercise of the option; provided that such shares shall not be withheld at rates
that exceed the minimum statutory withholding rates for federal, state and local
taxes, including payroll taxes.
10. TERMINATION AND AMENDMENT OF PLAN.
The Board of Directors may at any time terminate this Plan or make such
modifications of the Plan as it shall deem advisable. Any modification which
increases the number of shares which may be issued under the Plan (other than
pursuant to Paragraph 7 hereof ), or changes the requirements as to eligibility
for participation in the Plan shall become effective only upon approval of the
holders of a majority of the securities of the Company present, or represented,
and entitled to vote at a meeting duly held in accordance with the laws of the
State of Delaware. Notwithstanding the foregoing, rights under any options
granted prior to an amendment of the Plan shall not be impaired by such
amendment unless the optionees holding such outstanding options consent in
writing.
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11. INDEMNIFICATION.
In addition to such other rights of indemnification as they may have as
directors, the members of the Board of Directors or Committee administering the
Plan shall be indemnified by the Company against the reasonable expenses,
including attorneys' fees actually and necessarily incurred in connection with
the defense of any action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason of any action
taken or failure to act under or in connection with the Plan or any option
granted thereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by legal counsel selected by the Company)
or paid by them in satisfaction of a judgment in any such action, suit or
proceeding except in relation to matters as to which it shall be adjudged in
such action, suit or proceeding that such member is liable for negligence or
misconduct in the performance of his duties; provided that within 60 days after
institution of any such action, suit or proceeding, the member shall in writing
offer the Company the opportunity, at its own expense, to handle and defend the
same.
12. EFFECTIVE DATE AND DURATION OF THE PLAN.
The 1992 Stock Option Plan shall become effective on July 23, 1992. Any
rights granted under this Plan must be granted within ten (10) years of such
effective date.
