Exhibit 99.1
IGI, INC.
1999 DIRECTOR STOCK OPTION PLAN
1. Purpose
The purpose of this 1999 Director Stock Option Plan (the "Plan") of
IGI, Inc. (the "Company") is to encourage ownership in the Company by
outside directors of the Company whose continued services are considered
essential to the Company's future progress and to provide them with a
further incentive to remain as directors of the Company.
2. Administration
The Board of Directors shall supervise and administer the Plan.
Grants of stock options under the Plan and the amount and nature of the
awards to be granted shall be automatic in accordance with Section 5.
However, all questions of interpretation of the Plan or of any options
issued under it shall be determined by the Board of Directors and such
determination shall be final and binding upon all persons having an
interest in the Plan.
3. Participation in the Plan
Directors of the Company who are not employees of the Company or any
subsidiary of the Company shall be eligible to participate in the Plan.
4. Stock Subject to the Plan
(a) The maximum number of shares which may be issued under the Plan
shall be 675,000 shares of the Company's Common Stock, par value $0.01 per
share (the "Common Stock"), subject to adjustment as provided in Section 9
of the Plan.
(b) If any outstanding option under the Plan for any reason expires
or is terminated without having been exercised in full, the shares
allocable to the unexercised portion of such option shall again become
available for grant pursuant to the Plan.
(c) All options granted under the Plan shall be non-statutory
options not entitled to special tax treatment under Section 422 of the
Internal Revenue Code of 1986, as amended to date and as it may be amended
from time to time (the "Code").
5. Terms, Conditions and Form of Options
Each option granted under the Plan shall be evidenced by a written
agreement in such form as the Board of Directors shall from time to time
approve, which agreements shall comply with and be subject to the following
terms and conditions:
(a) Option Grant Dates
(i) On September 15, 1999, the Company shall grant to each
eligible director an option to purchase 50,000 shares of Common Stock
in consideration for past services performed.
(ii) Each year on January 2, beginning with January 2, 2000,
the Company shall grant to each eligible director an option to
purchase 15,000 shares of Common Stock (the "Annual Grant").
(iii) Each year on January 2, beginning with January 2, 2000,
the Company shall grant to the Chairman of the Audit Committee an
option to purchase 15,000 shares of Common Stock, and to the Chairman
of the Stock Option and Compensation Committee an option to purchase
10,000 shares of Common Stock.
(iv) Upon the initial election of any eligible director as a
director of the Company, the Company shall grant to such director an
option to purchase 15,000 shares of Common Stock (the "Initial
Option"), provided that no person serving as a director on September
15, 1999 shall receive such an option.
(b) Option Exercise Price
The option exercise price per share for each option granted under the
Plan shall equal the fair market value per share on the date of grant,
which is deemed to be the closing price of the Common Stock on the American
Stock Exchange on the date of grant. If the Common Stock is not then
traded on the American Stock Exchange, the fair market value shall be
determined in good faith by the Board of Directors.
(c) Options Non-Transferable
Except as otherwise provided in the option agreement evidencing the
option grant, each option granted under the Plan shall not be transferable
by the optionee otherwise than by will, or by the laws of descent and
distribution, and shall be exercised during the lifetime of the optionee
only by the optionee.
(d) Exercise Period
Each option granted under the Plan shall become exercisable in full,
12 months after the date of grant.
(e) Exercise Procedure
Options may be exercised only by written notice to the Company at its
principal office accompanied by (i) payment in cash of the full
consideration for the shares as to which they are exercised or (ii) an
irrevocable undertaking by a broker to deliver promptly to the Company
sufficient funds to pay the exercise price or delivery of irrevocable
instructions to a broker to deliver promptly to the Company cash or a check
sufficient to pay the exercise price.
6. Assignments
The rights and benefits of participants under the Plan may not be
assigned, whether voluntarily or by operation of law, except as provided in
Section 5(c).
7. Effective Date
The Plan shall become effective September 15, 1999.
8. Limitation of Rights
(a) No Right to Continue as a Director
Neither the Plan, nor the granting of an option nor any other
action taken pursuant to the Plan, shall constitute or be evidence of
any agreement or understanding, express or implied, that the Company
will retain a director for any period of time.
(b) No Stockholders' Rights for Options
An optionee shall have no rights as a stockholder with respect
to the shares covered by his options until the date of the issuance
to him of a stock certificate therefor, and no adjustment will be
made for dividends or other rights (except as provided in Section 9)
for which the record date is prior to the date such certificate is
issued.
9. Changes in Common Stock
(a) If the outstanding shares of Common Stock are increased,
decreased or exchanged for a different number or kind of shares or other
securities, or if additional shares or new or different shares or other
securities are distributed with respect to such shares of Common Stock or
other securities, through a merger, consolidation, sale of all or
substantially all of the assets of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse
stock split or other distribution with respect to such shares of Common
Stock, or other securities, an appropriate and proportionate adjustment
will be made in (i) the maximum number and kind of shares reserved for
issuance under the Plan, (ii) the number and kind of shares or other
securities subject to then outstanding options under the Plan and (iii) the
price for each share subject to any then outstanding options under the
Plan, without changing the aggregate purchase price as to which such
options remain exercisable. No fractional shares will be issued under the
Plan on account of any such adjustments.
(b) In the event that the Company is merged or consolidated into or
with another corporation (in which consolidation or merger the stockholders
of the Company receive distributions of cash or securities of another
issuer as a result thereof), or in the event that all or substantially all
of the assets of the Company are acquired by any other person or entity, or
in the event of a reorganization or liquidation of the Company, then (i)
all outstanding options shall automatically become vested in full and fully
exercisable immediately prior to the consummation of such merger,
consolidation, acquisition, reorganization or liquidation, and (ii) the
Board of Directors of the Company, or the board of directors of any
corporation assuming the obligations of the Company, shall, as to
outstanding options, either (x) provide that such options shall be assumed,
or equivalent options shall be substituted, by the acquiring or successor
corporation (or affiliate thereof), or (y) upon written notice to the
optionees, provide that all unexercised options will terminate immediately
following the vesting of such options in accordance with clause (i) above
and immediately prior to the consummation of such merger, consolidation,
acquisition, reorganization or liquidation unless exercised by the optionee
within a specified number of days following the date of such notice.
10. Amendment of the Plan
The Board of Directors may at any time, and from time to time,
modify, terminate or amend the Plan in any respect, except that if at any
time the approval of the stockholders of the Company is required as to such
modification or amendment under any applicable listing requirement or any
applicable tax or regulatory requirement, the Board of Directors may not
effect such modification or amendment without such approval.
11. Notice
Any written notice to the Company required by any of the provisions
of the Plan shall be addressed to the Controller of the Company and shall
become effective when it is received.
12. Governing Law
The Plan and all determinations made and actions taken pursuant
hereto shall be governed by the laws of the State of Delaware.
Adopted by the Board of Directors
on September 15, 1999
