<PAGE>
As filed with the Securities and Exchange Commission on September 30, 1998
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
________________________
FLIR SYSTEMS, INC.
(Exact name of registrant as specified in charter)
OREGON 93-0708501
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
________________________
16505 S.W. 72ND AVENUE, PORTLAND, OREGON 97224
(503) 684-3731
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
________________________
FLIR SYSTEMS, INC. 1992 STOCK INCENTIVE PLAN
________________________
J. KENNETH STRINGER III
PRESIDENT AND CHIEF OPERATING OFFICER
FLIR SYSTEMS, INC.
16505 S.W. 72ND AVENUE, PORTLAND, OREGON 97224
(503) 684-3731
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
________________________
with copies to:
GREGORY E. STRUXNESS, ESQ.
ATER WYNNE LLP
222 S.W. COLUMBIA, SUITE 1800, PORTLAND, OREGON 97201
(503) 226-1191
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=================================================================================================================================
Title of Securities to Amount to be Proposed Maximum Proposed Maximum Amount of
be Registered Registered Offering Aggregate Offering Price (1) Registration Fee
Price per Share (1)
<S> <C> <C> <C> <C>
Common Stock, par
value $.01 per share 2,500,000 shares $13.75 $34,375,000 $10,141
==================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
===========================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This registration statement is filed in accordance with the provisions of
General Instruction E to Form S-8 for the purpose of registering additional
shares of common stock for offer and sale under the FLIR Systems, Inc. 1992
Stock Incentive Plan, for which a registration statement on Form S-8 (File No.
33-82676) is already effective. Except to the extent that exhibits are filed
herewith the contents of FLIR Systems, Inc.'s registration statement on Form S-8
(File No. 33-82676) are hereby incorporated by reference.
ITEM 8. EXHIBITS
Number Description
------ -----------
5.1 Opinion of Ater Wynne LLP as to the legality of the
securities being registered
23.1 Consent of Ater Wynne LLP (included in legal opinion filed as
Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers LLP
24.1 Powers of Attorney (included in signature page in Part II of
the Registration Statement)
99.1 FLIR Systems, Inc. 1992 Stock Incentive Plan, as amended
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes to file, during any
period in which offers or sales are being made, a post-effective amendment to
this registration statement:
(i) to include any prospectus required by section 10(a)(3) of the
Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the registration statement;
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement; provided,
however, that paragraphs (i) and (ii) do not
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<PAGE>
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(b) The undersigned registrant hereby undertakes that, for the purpose
of determining liability under the Securities Act of 1933, each such post-
effective amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned registrant hereby undertakes to remove from
registration by means of a post-effective amendment any of the securities being
registered which remain unsold at the termination of the offering.
(d) Insofar as indemnification for liabilities arising under the Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such a
director, officer or controlling person in connection with securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(e) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto authorized,
in the City of Portland, State of Oregon, on the 29th day of September, 1998.
FLIR SYSTEMS, INC.
By: /s/ J. Kenneth Stringer III
---------------------------
J. Kenneth Stringer III
President and Chief Operating Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Robert P. Daltry and J. Kenneth Stringer III, and
each of them singly, as true and lawful attorneys-in-fact and agents with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities to sign the registration statement filed
herewith and any or all amendments to said registration statement (including
post-effective amendments), and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission granting unto said attorneys-in-fact and agents and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the foregoing, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents or any of them, or
their or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Witness our hands on the date set forth below.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
[Signatures on following page]
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<PAGE>
Signature Title Date
--------- ----- ----
/s/ Robert P. Daltry Chairman of the Board and Chief 9/29/98
- --------------------- Executive Officer (Principal
Robert P. Daltry Executive Officer)
/s/ J. Kenneth Stringer III Director, President and Chief 9/29/98
- ---------------------------- Operating Officer
J. Kenneth Stringer III
/s/ J. Mark Samper Vice President Finance and Chief 9/29/98
- ------------------ Financial Officer (Principal Financial
J. Mark Samper and Accounting Officer)
/s/ Leif Bergstrom Vice Chairman of the Board of Directors 9/29/98
- ------------------
Leif Bergstrom
/s/ Patrick L. Edsell Director 9/29/98
- ---------------------
Patrick L. Edsell
/s/ John C. Hart Director 9/29/98
- ----------------
John C. Hart
/s/ Egon Linderoth Director 9/29/98
- ------------------
Egon Linderoth
/s/ W. Allen Reed Director 9/29/98
- ------------------
W. Allen Reed
/s/ Lars Spongberg Director 9/29/98
- -------------------
Lars Spongberg
/s/ Ronald L. Turner Director 9/29/98
- ---------------------
Ronald L. Turner
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<PAGE>
INDEX TO EXHIBITS
Exhibit Page
Number Exhibit No.
------- ------- ----
5.1 Opinion of Ater Wynne LLP as to the legality of the
securities being registered
23.1 Consent of Ater Wynne LLP (included in legal opinion
filed as Exhibit 5.1)
23.2 Consent of PricewaterhouseCoopers LLP
24.1 Powers of Attorney (included in signature page in
Part II of the Registration Statement)
99.1 FLIR Systems, Inc. 1992 Stock Incentive Plan, as
amended
<PAGE>
EXHIBIT 5.1
ATER WYNNE LLP
222 S.W. Columbia, Suite 1800
Portland, Oregon 97201
(503)226-1191 (phone)
(503)226-0079 (fax)
September 29, 1998
Board of Directors
FLIR Systems, Inc.
16505 S.W. 72nd Avenue
Portland, OR 97224
Gentlemen:
In connection with the registration of 2,500,000 shares of common stock,
par value $.01 per share (the "Common Stock"), of FLIR Systems, Inc., an Oregon
corporation (the "Company"), under the Registration Statement on Form S-8 to be
filed with the Securities and Exchange Commission on September 30, 1998, and the
proposed offer and sale of the Common Stock pursuant to the terms of the
Company's 1992 Stock Incentive Plan (the "1992 Plan"), we have examined such
corporate records, certificates of public officials and officers of the Company
and other documents as we have considered necessary or proper for the purpose of
this opinion.
Based on the foregoing and having regard to legal issues which we deem
relevant, it is our opinion that the shares of Common Stock to be offered
pursuant to the 1992 Plan, when such shares have been delivered against payment
therefor as contemplated by the 1992 Plan, will be validly issued, fully paid
and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the above-
mentioned registration statement.
Very truly yours,
/s/ Ater Wynne LLP
Ater Wynne LLP
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this registration
statement on Form S-8 of our report dated March 9, 1998 appearing on page 19 of
FLIR Systems, Inc. Annual Report on Form 10-K for the year ended December 31,
1997. We also consent to the incorporation by reference of our report on the
Financial Statement Schedule, which appears on page 42 of such Annual Report on
Form 10-K.
/s/ PricewaterhouseCoopers LLP
PRICEWATERHOUSECOOPERS LLP
Portland, Oregon
September 30, 1998
<PAGE>
EXHIBIT 99.1
FLIR SYSTEMS, INC.
1992 STOCK INCENTIVE PLAN*
1. PURPOSES OF THE PLAN. The purposes of this Stock Incentive Plan are
to attract and retain the best available personnel for positions of substantial
responsibility, to provide addi tional incentive to the Employees and
Consultants of the Company and to promote the success of the Company's business.
Options granted hereunder may be either "incentive stock options," as
defined in Section 422 of the Internal Revenue Code of 1986, as amended, or
"nonqualified stock options," at the discretion of the Board and as reflected in
the terms of the written option agreement. In addition, shares of the Company's
Common Stock may be Sold hereunder independent of any Option grant.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "Board" shall mean the Committee, if one has been appointed, or
the Board of Directors of the Company, if no Committee is appointed.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Common Stock" shall mean the Common Stock of the Company.
(d) "Company" shall mean FLIR Systems, Inc., an Oregon corporation.
(e) "Committee" shall mean the Committee appointed by the Board of
Directors in accordance with paragraph (a) of Section 4 of the Plan, if one is
appointed.
(f) "Consultant" shall mean any person who is engaged by the Company
or any Subsidiary to render consulting services and is compensated for such
consulting services and any director of the Company whether compensated for such
services or not.
(g) "Continuous Status as an Employee or Consultant" shall mean the
absence of any interruption or termination of service as an Employee or
Consultant. Continuous Status as an Employee or Consultant shall not be
considered interrupted in the case of sick leave, military leave, or any other
leave of absence approved by the Board; provided that such leave is for a period
of not more than ninety days or reemployment upon the expiration of such leave
is guaranteed by contract or statute.
______________
*Note: Matter in BOLD FACE (other than headings) is new, and matter in
[brackets] has been deleted.
-1-
<PAGE>
(h) "Employee" shall mean any person, including officers and
directors, employed by the Company or any Parent or Subsidiary of the Company.
The payment of a director's fee by the Company shall not be sufficient to
constitute "employment" by the Company.
(i) "Incentive Stock Option" shall mean an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.
(j) "Nonqualified Stock Option" shall mean an Option not intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.
(k) "Option" shall mean a stock option granted pursuant to the Plan.
(l) "Optioned Stock" shall mean the Common Stock subject to an
Option.
(m) "Optionee" shall mean an Employee or Consultant who receives an
Option.
(n) "Parent" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 425(e) of the Code.
(o) "Plan" shall mean this Stock Incentive Plan.
(p) "Sale" or "Sold" shall include, with respect to the sale of
Shares under the Plan, the sale of Shares for consideration in the form of cash
or notes, as well as a grant of Shares without consideration, except past or
future services.
(q) "Share" shall mean a share of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.
(r) "Subsidiary" shall mean a "subsidiary corporation," whether now
or hereafter existing, as defined in Section 425(f) of the Code.
3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 11 of
the Plan, the maximum aggregate number of Shares which may be optioned and/or
Sold under the Plan is [1,972,855] 3,472,855 shares of Common Stock.
If an Option should expire or become unexercisable for any reason without
having been exercised in full, the unpurchased Shares which were subject thereto
shall, unless the Plan shall have been terminated, become available for future
Option grants and/or Sales under the Plan. If Shares Sold under the Plan are
repurchased by the Company pursuant to restrictions applicable to such Shares,
the number of Shares repurchased shall, unless the Plan shall have been
terminated, become available for future Option grants and/or Sales under the
Plan.
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<PAGE>
4. ADMINISTRATION OF THE PLAN.
(a) Procedure. The Plan shall be administered by the Board of
Directors of the Company.
(i) Subject to subparagraph (ii), the Board of Directors may
appoint a Committee consisting of not less than three (3) members of the Board
of Directors to administer the Plan on behalf of the Board of Directors, subject
to such terms and conditions as the Board of Directors may prescribe. Once
appointed, the Committee shall continue to serve until otherwise directed by the
Board of Directors. From time to time the Board of Directors may increase the
size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies however caused, or remove all members of the Committee and thereafter
directly administer the Plan.
Members of the Board who are either eligible for Options and/or Sales or
have been granted Options or Sold Shares may vote on any matters affecting the
administration of the Plan or the grant of any Options or Sale of any Shares
pursuant to the Plan, except that no such member shall act upon the granting of
an Option or Sale of Shares to himself, but any such member may be counted in
determining the existence of a quorum at any meeting of the Board during which
action is taken with respect to the granting of Options or Sale of Shares to
him.
(ii) Notwithstanding the foregoing subparagraph (i), if and in
any event the Company registers any class of any equity security pursuant to
Section 12 of the Securities Exchange Act of 1934, from the effective date of
such registration until six (6) months after the termination of such
registration, any grants of Options to officers or directors shall only be made
by the Board if each member of the Board is a disinterested person, or if every
member of the Board is not a disinterested person, by a committee of two or more
directors, each of whom is a disinterested person, i.e., a director who is not,
during the one year prior to service as an administrator of a plan, or during
such service, granted or awarded equity securities pursuant to the Plan or any
other plan of the Company or any of its affiliates, except that:
(A) participation in a formula plan meeting the conditions
in paragraph (c)(2)(ii) of SEC Rule 16b-3 shall not disqualify a director from
being a disinterested person;
(B) participation in an ongoing securities acquisition plan
meeting the conditions in paragraph (d)(2)(i) of SEC Rule 16b-3 shall not
disqualify a director from being a disinterested person;
(C) an election to receive an annual retainer fee in either
cash or an equivalent amount of securities, or partly in cash and partly in
securities, shall not disqualify a director from being a disinterested person;
and
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<PAGE>
(D) participation in a plan shall not disqualify a director
from being a disinterested person for the purpose of administering another plan
that does not permit participation by directors.
(b) Powers of the Board. Subject to the provisions of the Plan, the
Board shall have the authority, in its discretion: (i) to grant Incentive Stock
Options in accordance with Section 422 of the Code, or nonqualified stock
Options; (ii) to authorize Sales of Shares of Common Stock hereunder; (iii) to
determine, upon review of relevant information and in accordance with Section
8(b) of the Plan, the fair market value of the Common Stock; (iv) to determine
the exercise/purchase price per share of Options to be granted or Shares to be
Sold, which exercise/purchase price shall be determined in accordance with
Section 8(a) of the Plan; (v) to determine the Employees or Consultants to whom,
and the time or times at which, Options shall be granted and the number of
Shares to be represented by each Option; (vi) to determine the Employees or
Consultants to whom, and the time or times at which, Shares shall be Sold and
the number of Shares to be Sold; (vii) to interpret the Plan; (viii) to
prescribe, amend and rescind rules and regulations relating to the Plan; (ix) to
determine the terms and provisions of each Option granted (which need not be
identical) and, with the consent of the holder thereof, modify or amend each
Option; (x) to determine the terms and provisions of each Sale of Shares (which
need not be identical) and, with the consent of the purchaser thereof, modify or
amend each Sale; (xi) to accelerate or defer (with the consent of the Optionee)
the exercise date of any Option, consistent with the provisions of Section 9 of
the Plan; (xii) to accelerate or defer (with the consent of the Optionee or
purchaser of Shares) the vesting restrictions applicable to Shares Sold under
the Plan or pursuant to Options granted under the Plan; (xiii) to authorize any
person to execute on behalf of the Company any instrument required to effectuate
the grant of an Option or Sale of Shares previously granted or authorized by the
Board; (xiv) to determine the restrictions on transfer, vesting restrictions,
repurchase rights, or other restrictions applicable to Shares issued under the
Plan; (xv) to effect, at any time and from time to time, with the con sent of
the affected Optionees, the cancellation of any or all outstanding Options under
the Plan and to grant in substitution therefor new Options under the Plan
covering the same or different numbers of Shares, but having an Option price per
Share consistent with the provisions of Section 8 of this Plan as of the date of
the new Option grant; and (xvi) to make all other deter minations deemed
necessary or advisable for the administration of the Plan.
(c) Effect of Board's Decision. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees and any
other holders of any Options granted under the Plan or Shares Sold under the
Plan.
5. ELIGIBILITY.
(a) Persons Eligible. Options may be granted and/or Shares Sold only
to Employees and Consultants. Incentive Stock Options may be granted only to
Employees. An Employee or Consultant who has been granted an Option or Sold
Shares may, if he is otherwise eligible, be granted an additional Option or
Options or Sold additional Shares.
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<PAGE>
(b) ISO Limitation. No Incentive Stock Option may be granted to an
Employee which, when aggregated with all other Incentive Stock Options granted
to such Employee by the Company or any Parent or Subsidiary, would result in
Shares having an aggregate fair market value (determined for each Share as of
the date of grant of the Option covering such Share) in excess of $100,000
becoming first available for purchase upon exercise of one or more Incentive
Stock Options during any calendar year.
(c) Section 5(b) Limitations. Section 5(b) of the Plan shall apply
only to an Incentive Stock Option evidenced by an "Incentive Stock Option
Agreement" which sets forth the intention of the Company and the Optionee that
such Option shall qualify as an Incentive Stock Option. Section 5(b) of the Plan
shall not apply to any Option evidenced by a "Nonqualified Stock Option
Agreement" which sets forth the intention of the Company and the Optionee that
such Option shall be a Nonqualified Stock Option.
(d) No Right to Continued Employment. The Plan shall not confer upon
any Optionee any right with respect to continuation of employment or consulting
relationship with the Company, nor shall it interfere in any way with his right
or the Company's right to terminate his employment or consulting relationship at
any time.
6. TERM OF PLAN. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
stockholders of the Company as described in Section 17 of the Plan. It shall
continue in effect for a term of ten (10) years, unless sooner terminated under
Section 13 of the Plan.
7. TERM OF OPTION. The term of each Incentive Stock Option shall be ten
(10) years from the date of grant thereof or such shorter term as may be
provided in the Stock Option Agreement. The term of each Nonqualified Stock
Option shall be ten (10) years and one (1) day from the date of grant thereof or
such shorter term as may be provided in the Stock Option Agreement. However, in
the case of an Option granted to an Optionee who, at the time the Option is
granted, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary, (a) if the
Option is an Incentive Stock Option, the term of the Option shall be five (5)
years from the date of grant thereof or such shorter time as may be provided in
the Stock Option Agreement, or (b) if the Option is a Nonqualified Stock Option,
the term of the Option shall be five (5) years and one (1) day from the date of
grant thereof or such shorter term as may be provided in the Stock Option
Agreement.
8. EXERCISE/PURCHASE PRICE AND CONSIDERATION.
(a) Exercise/Purchase Price. The per-Share exercise/purchase price
for the Shares to be issued pursuant to exercise of an Option or a Sale (other
than a Sale which is a grant for which no purchase price is payable) shall be
such price as is determined by the Board, but shall be subject to the following:
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(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the time of the grant of
such Incentive Stock Option, owns stock representing more than ten percent (10%)
of the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be no less than one hundred ten
percent (110%) of the fair market value per Share on the date of the grant.
(B) granted to any other Employee, the per Share exercise
price shall be no less than one hundred percent (100%) of the fair market value
per Share on the date of grant.
(ii) In the case of a Nonqualified Stock Option or Sale.
(A) granted or Sold to a person who, at the time of the
grant of such Option or authorization of such Sale, owns stock representing more
than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary, the per Share exercise/purchase price shall
be no less than one hundred ten percent (110%) of the fair market value per
Share on the date of the grant or authorization of Sale.
(B) granted or Sold to any other person, the per Share
exercise/purchase price shall be no less than eighty-five percent (85%) of the
fair market value per Share on the date of grant or authorization of Sale.
(iii) In the case of an Option granted or Sale authorized on or
after the effective date of registration of any class of equity security of the
Company pursuant to Sec tion 12 of the Exchange Act and prior to six (6) months
after the termination of such regis tration, the per Share exercise/purchase
price shall be no less than one hundred percent (100%) of the fair market value
per Share on the date of grant or authorization of Sale.
(b) Fair Market Value. The fair market value per Share shall be
determined by the Board in its discretion; provided, however, that where there
is a public market for the Common Stock, the fair market value per Share shall
be the mean of the bid and asked prices of the Common Stock for the date of
grant or authorization of Sale, as reported in The Wall Street Journal (or, if
not so reported, as otherwise reported by the National Association of Securities
Dealers Automated Quotation (NASDAQ) System) or, in the event the Common Stock
is listed on a stock exchange (including NASDAQ), the fair market value per
Share shall be the closing price on such exchange on the date of grant of the
Option or authorization of Sale, as reported in The Wall Street Journal.
(c) Consideration. The consideration to be paid for the Shares to be
issued upon exercise of an Option or pursuant to a Sale, including the method of
payment, shall be determined by the Board and may consist entirely of cash,
check, promissory note, other Shares of Common Stock having a fair market value
on the date of surrender equal to the aggregate
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<PAGE>
exercise/purchase price of the Shares as to which said option shall be exercised
or Sale consum mated, or any combination of such methods of payment for the
issuance of Shares.
9. EXERCISE OF OPTION.
(a) Procedure for Exercise; Rights as a Stockholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Board, including performance criteria with respect to the
Company and/or the Optionee, and as shall be permissible under the terms of the
Plan.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Board, consist of any
consideration and method of payment allowable under Section 8(c) of the Plan.
Each Optionee who exercises an Option shall, upon notification of the amount due
(if any) and prior to or concurrent with delivery of the certificate
representing the Shares, pay to the Company amounts necessary to satisfy
applicable federal, state and local tax withholding requirements. An Optionee
must also provide a duly executed copy of any stock transfer agreement then in
effect and determined to be applicable by the Board. Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. 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 11 of the Plan.
Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be 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 Status as an Employee or Consultant. If an
Employee or Consultant ceases to serve as an Employee or Consultant (as the case
may be), he may, but only within three (3) months (or with respect to
Nonqualified Stock Options, such other period of time not exceeding the
limitations of Section 7 above as is determined by the Board at the time of
grant of the Nonqualified Stock Option) after the date he ceases to be an
Employee or Consultant (as the case may be) of the Company, exercise his Option
to the extent that he was entitled to exercise it at the date of such
termination. To the extent that he was not entitled to exercise the Option at
the date of such termination, or if he does not exercise such Option (which he
was entitled to exercise) within the time specified herein, the Option shall
terminate.
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<PAGE>
(c) Disability of Optionee. Notwithstanding the provisions of
Section 9(b) above, in the event an Employee or Consultant is unable to continue
his employment or consulting relationship (as the case may be) with the Company
as a result of his total and permanent disability (as defined in Section
22(e)(3) of the Code), he may, but only within twelve (12) months (or with
respect to Nonqualified Stock Options, such other period of time not exceeding
the limitations of Section 7 above as is determined by the Board at the time of
grant of the Nonqualified Stock Option) from the date of termination, exercise
his Option to the extent he was entitled to exercise it at the date of such
termination. To the extent that he was not entitled to exercise the Option at
the date of termination, or if he does not exercise such Option (which he was
entitled to exercise) within the time specified herein, the Option shall
terminate.
(d) Death of Optionee. In the event of the death of an Optionee
during the term of the Option who is at the time of his death an Employee or
Consultant of the Company and who shall have been in Continuous Status as an
Employee or Consultant since the date of grant of the Option, the Option may be
exercised, at any time within twelve (12) months (or such other period of time
not exceeding the limitations of Section 7 above as is determined by the Board
at the time of grant of the Option) following the date of death, by the
Optionee's estate or by a person who acquired the right to exercise the Option
by bequest or inheritance, but only to the extent of the right to exercise as of
the date of death.
10. NONTRANSFERABILITY OF OPTIONS. An Option may not be sold, pledged,
assigned, hypothecated, transferred or disposed of in any manner other than by
will, by the laws of descent or distribution, or pursuant to a qualified
domestic relations order as defined by the Internal Revenue Code of 1986, as
amended, or Title I of the Employee Retirement Income Security Act, or the rules
thereunder (a "QDRO"), and may be exercised during the lifetime of the Optionee
only by the Optionee or, if incapacitated, by his or her legal guardian or legal
representative, or pursuant to a QDRO.
11. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER. Subject to any
required action by the stockholders 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 sales made or which have been returned
to the Plan upon cancellation or 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
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adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Option.
In the event of the proposed dissolution or liquidation of the Company, the
Option will terminate immediately prior to the consummation of such proposed
action, unless otherwise pro vided by the Board. 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 his Option as to all or any part of the Optioned Stock, including
Shares as to which the Option would not otherwise be exercisable. In the event
of a proposed sale of all or substantially all of the assets of the Company, or
the merger of the Company with or into another corporation, the Option shall be
assumed or an equivalent option shall be substituted by such successor
corporation or a parent or subsidiary of such successor corporation, unless the
Board determines, in the exercise of its sole discretion and in lieu of such
assumption or substitution, that the Optionee shall have the right to exercise
the Option as to all of the Optioned Stock, including Shares as to which the
Option would not otherwise be exercisable. If the Board makes an Option fully
exercisable in lieu of assumption or substitution in the event of a merger or
sale of assets, the Board shall notify the Optionee that the Option shall be
fully exercisable for a period of thirty (30) days from the date of such notice
or such shorter period as the Board may specify in the notice, and the Option
will terminate upon the expiration of such period.
12. TIME OF GRANTING OPTIONS. The date of grant of an Option shall, for
all purposes, be the date on which the Board makes the determination granting
such Option. Notice of the determination shall be given to each Employee or
Consultant to whom an Option is so granted within a reasonable time after the
date of such grant.
13. AMENDMENT AND TERMINATION OF THE PLAN.
(a) Amendment and Termination. The Board may amend or terminate the
Plan from time to time in such respects as the Board may deem advisable;
provided, however, that if required to qualify the Plan under Rule 16b-3
promulgated under Section 16 of the Securities Exchange Act of 1934, as amended,
no amendment shall be made more than once every six months that would change the
amount, price or timing of the option grants, other than to comport with changes
in the Internal Revenue Code of 1986, as amended, or the rules and regulations
promulgated thereunder; and provided, further, that, the following revisions or
amendments shall require approval of the stockholders of the Company in the
manner described in Section 17 of the Plan:
(i) any increase in the number of Shares subject to the Plan,
other than in connection with an adjustment under Section 11 of the Plan;
(ii) any change in the designation of the class of Employees or
Consultants eligible to be granted Options; or
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(iii) if the Company has a class of equity security registered
under Section 12 of the Exchange Act at the time of such revision or amendment,
any material increase in the benefits accruing to participants under the Plan.
(b) Stockholder Approval. If any amendment requiring stockholder
approval under Section 13(a) of the Plan is made subsequent to the first
registration of any class of equity security by the Company under Section 12 of
the Exchange Act, such stockholder approval shall be solicited as described in
Section 17(a) of the Plan.
(c) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted, and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee and
the Board, which agreement must be in writing and signed by the Optionee and the
Company.
14. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued
pursuant to the exercise of an Option or a Sale unless the exercise of such
Option or consummation of the Sale and the issuance and delivery of such Shares
pursuant thereto shall comply with all relevant provisions of law, including,
without limitation, the Securities Act of 1933, as amended, applicable state
securities laws, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an Option or a Sale, the Company may
require the person exercising such Option or to whom Shares are being Sold to
represent and warrant at the time of any such exercise or Sale 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 by any of the aforementioned relevant
provisions of law.
15. 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.
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.
16. OPTION AGREEMENT. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
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17. STOCKHOLDER APPROVAL. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve months before or after
the date the Plan is adopted. If such stockholder approval is obtained at a duly
held stockholders' meeting, it may be obtained by the affirmative vote of the
holders of a majority of the outstanding shares of the Company, such holders
being present or represented and entitled to vote thereon. If and in the event
that the Company registers any class of any equity security pursuant to Section
12 of the Exchange Act, the approval of such stockholders of the Company shall
be:
(a) Solicitation.
(i) solicited substantially in accordance with Section 14(a) of
the Exchange Act and the rules and regulations promulgated thereunder, or
(ii) solicited after the Company has furnished in writing to the
holders entitled to vote substantially the same information concerning the Plan
as that which would be required by the rules and regulations in effect under
Section 14(a) of the Exchange Act at the time such information is furnished; and
(b) Time. Obtained at or prior to the first annual meeting of
stockholders held subsequent to the first registration of any class of equity
securities of the Company under Section 12 of the Exchange Act.
If such stockholder approval is obtained by written consent, it must be
obtained by the written consent of stockholders of the Company in compliance
with the requirements of applicable state law.
18. SIX MONTH HOLDING PERIOD FOR AFFILIATES. If and in any event the
Company registers any class of any equity security pursuant to Section 12 of the
Securities Exchange Act of 1934, from the effective date of such registration
until six (6) months after the termination of such registration, each officer,
director and beneficial owner of ten percent (10%) or more of any class of
equity securities of the Company, shall hold the equity security issuable upon
exercise of an Option or issued pursuant to a Sale, at least six months from the
date of grant of the Option or the Sale.
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