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EXHIBIT 4.3
ROCKETCHIPS, INC.
2000 NON-QUALIFIED STOCK OPTION PLAN
SECTION 1
DEFINED TERMS
In addition to the other definitions contained herein, the following
definitions shall apply:
1.1 Award. The term "Award" shall mean any award or benefit granted in
accordance with the terms of the Plan. Awards under the Plan may be in the form
of (i) Stock Options; (ii) Restricted Stock; and/or (iii) Tax Offset Payments.
1.2 Board. The term "Board" shall mean the Board of Directors of the
Company.
1.3 Change in Control. The term "Change in Control" shall mean:
(a) the acquisition by any person or group deemed a person under
Sections 3(a)(9) and 13(d)(3) of the Exchange Act (other than the
Company and its subsidiaries as determined immediately prior to
that date) of beneficial ownership, directly or indirectly (with
beneficial ownership determined as provided in Rule 13d-3, or any
successor rule, under the Exchange Act), of a majority of the
total combined voting power of all classes of Stock of the
Company having the right under ordinary circumstances to vote at
an election of the Board, if such person or group deemed a person
prior to such acquisition was not a beneficial owner of at least
five percent (5%) of such total combined voting power of the
Company;
(b) the date of approval by the stockholders of the Company of an
agreement providing for the merger or consolidation of the
Company with another corporation or other entity where (x)
stockholders of the Company immediately prior to such merger or
consolidation would not beneficially own following such merger or
consolidation shares entitling such stockholders to a majority of
all votes (without consolidation of the rights of any class of
stock to elect directors by a separate class vote) to which all
stockholders of the surviving corporation would be entitled in
the election of directors, or (y) where the members of the Board,
immediately prior to such merger or consolidation, would not,
immediately after such merger or consolidation, constitute a
majority of the board of directors of the surviving corporation;
or
(c) the sale of all or substantially all of the assets of the
Company.
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1.4 Code. The term "Code" shall mean the Internal Revenue Code of 1986,
as amended. A reference to any provision of the Code shall include reference to
any successor provision of the Code.
1.5 Committee. The term "Committee" shall mean a committee described in
Section 6.
1.6 Company. The term "Company" shall mean RocketChips, Inc.
1.7 Covered Shares. The term "Covered Shares" shall mean the number of
shares of Stock that an Eligible Individual may purchase pursuant to an Option.
1.8 Director. The term "Director" shall mean a member of the Company's
Board.
1.9 Eligible Individual. The term "Eligible Individual" shall mean (a)
any common law employee, prospective employee, or officer of the Company, (b)
members of the Company's Board, (c) consultants and advisors to the Company and
any Related Company. All Eligible Individuals must be natural persons who
provide bona fide services to the Company or a Related Company. In addition,
the services provided to the Company or Related Company must not be in
connection with an offer or sale of securities in a capital raising transaction
and must not directly or indirectly promote or maintain a market for the
Company's Stock. An Award may be granted to an Eligible Individual prior to the
date the Eligible Individual performs services for the Company or Related
Company, provided that such Award shall not become vested prior to the date the
Eligible Individual first performs such services.
1.10 Exchange Act. The term "Exchange Act" shall mean the Securities Act
of 1934, as amended.
1.11 Exercise Price. The term "Exercise Price" shall mean the exercise
price of each Option granted under Section 3 established by the Board and
determined by any reasonable method established by the Board at the time the
Option is granted. The Exercise Price shall not be less than 85% of the Fair
Market Value of a share of Stock on the date of grant of such Option.
1.12 Fair Market Value. The term "Fair Market Value" of a share of Stock
on a given date shall mean the closing price of the share of Stock as reported
on the Nasdaq Stock Market on such date, if the share of Stock is then quoted on
the Nasdaq Stock Market or, if the market is closed on that date, the closing
price of the share of Stock on the previous trading day. If the Stock is not
listed on the Nasdaq Stock Market, Fair Market Value shall be determined in good
faith by the Board.
1.13 Non-Employee Director. The term "Non-Employee Director" shall mean a
"non-employee director" as defined in Rule 16b-3(b)(3)(i) of the Exchange Act.
1.14 Non-Qualified Stock Option Agreement. The term "Non-Qualified Stock
Option Agreement" or "Agreement" shall mean any written agreement evidencing the
terms and conditions of an NSO granted under the Plan. The Agreement shall be
subject to the terms and conditions of the Plan.
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1.15 Non-Qualified Stock Option. The term "Non-Qualified Stock Option" or
"NSO" shall mean an Option that is not intended to satisfy the requirements
applicable to an "incentive stock option" described in Section 422(b) of the
Code. NSO grants may be awarded to any Eligible Individual.
1.16 Option. The term "Option" or "Stock Option" shall mean an NSO
granted pursuant to the Plan. The grant of an Option entitles the Eligible
Individual to purchase shares of Stock at an Exercise Price established by the
Committee.
1.17 Performance Award. A "Performance Award" shall mean an award or
grant of shares based upon the achievement of performance objectives, as
contemplated by Section 3.8.
1.18 Plan. The term "Plan" shall mean this 2000 Non-Qualified Stock
Option Plan.
1.19 Related Company. The term "Related Company" shall mean any
corporation other than the Company and any partnership, joint venture or other
entity in which the Company owns, directly or indirectly, at least a 20%
beneficial ownership interest. A Related Company includes a subsidiary of the
Company and an unbroken chain of corporations beginning with the Company if each
of the corporations other than the last corporation in the unbroken chain owns
50% or more of the voting stock in one of the other corporations in such chain.
1.20 Stock. The term "stock" shall mean shares of common stock, $.01 par
value, of the Company.
SECTION 2
PURPOSE
The RocketChips, Inc. 2000 Non-Qualified Stock Option Plan has been
established by RocketChips, Inc. to (i) attract and retain individuals eligible
to participate in the Plan; (ii) motivate Eligible Individuals, by means of
appropriate incentives, to achieve long-range goals; (iii) provide incentive
compensation opportunities that are competitive with those of other similar
companies; and (iv) further identify Eligible Individuals' interests with those
of the Company's other shareholders through compensation that is based on the
Company's common stock; and thereby promote the long-term financial interest of
the Company and any Related Company, including the growth in value of the
Company's equity and enhancement of long-term shareholder return.
SECTION 3
GRANT OF AWARDS
3.1 Participation. Subject to the terms and conditions of the Plan,
the Board may determine and designate, from time to time, Eligible Individuals
who will be granted one or more
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Awards under the Plan at the Exercise Price. In its sole discretion and without
shareholder approval, the Board may grant to an Eligible Individual any Award or
Awards permitted under the provisions of the Plan. The Exercise Price of an
Option granted under this Section 3 shall be established by the Board or shall
be determined by a method established by the Board at the time the Option is
granted, except that the Exercise Price shall not be less than 85% of the Fair
Market Value of a share of Stock on the date of grant. Awards may be granted as
alternatives to or replacement of Awards outstanding under the Plan, or any
other plan or arrangement of the Company or Related Company (including a plan or
arrangement of a business or entity, all or a portion of which is acquired by
the Company or a Related Company).
3.2 Exercise of an Option. An Option shall be exercisable in accordance
with such terms and conditions and during such periods as may be established by
the Board. In no event shall any fraction of a share of Stock be issued upon
the exercise of an Option. An Option shall be deemed exercised when the Company
receives (a) written notice of exercise from the person entitled to exercise the
Option and (b) full payment of the Exercise Price for the Covered Shares and all
applicable withholding taxes due upon such exercise.
3.3 Payment of Option Exercise Price. The payment of the Exercise Price
of an Option granted under this Section 3 shall be subject to the following:
(a) Subject to the following provisions of this Subsection 3.3(a),
the full Exercise Price for shares of Stock purchased upon the
exercise of any Option shall be paid at the time of such exercise
(except that, in the case of an exercise arrangement approved by
the Board and described in Subsection 3.3(c), payment may be made
as soon as practicable after the exercise).
(b) Payment of the Exercise Price shall be made in such manner as the
Board may provide in the Award, which may include cash (including
cash equivalents), delivery of shares of Stock already owned by
the Eligible Individual or subject to Awards hereunder (so-called
"cashless" or "immaculate" exercise methods), and any other
manner permitted by law and approved by the Board, or any
combination of the foregoing. If the Company determines that a
Stock Option may be exercised using shares of Restricted Stock,
then unless the Board provides otherwise, the shares received
upon the exercise of a Stock Option which are paid for using
Restricted Stock shall be restricted in accordance with the
original terms of the Restricted Stock Award.
(c) An Eligible Individual may elect to pay the Exercise Price upon
the exercise of an Option by irrevocably authorizing a third
party to sell shares of Stock (or a sufficient portion of the
shares) acquired upon exercise of the Option and remit to the
Company a sufficient portion of the sale proceeds to pay the
entire Exercise Price and any tax withholding resulting from such
exercise.
3.4 Settlement of Option. Shares of Stock delivered pursuant to the
exercise of an Option shall be subject to such conditions, restrictions and
contingencies as the Board, in its discretion, may establish in addition to
such conditions, restrictions, and contingencies set forth in the Agreement.
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3.5 Reload Options. The Board may grant "reload" options, pursuant to
the terms and conditions established by the Board and any applicable
requirements of Rule 16b-3 of the Exchange Act ("Rule 16b-3") or any other
applicable law. The Eligible Individual would be granted a new Option when the
payment of the Exercise Price of a previously granted Option is made by the
delivery of shares of the Company's Stock owned by the Eligible Individual
pursuant to Section 3.3(b) hereof and/or when shares of the Company's Stock are
tendered or forfeited as payment of the amount to be withheld under applicable
income tax laws in connection with the exercise of an Option. The new Option
would be an Option to purchase the number of shares not exceeding the sum of (i)
the number of shares of the Company's Stock provided as consideration upon the
exercise of the previously granted Option to which such "reload" option relates
and (ii) the number of shares of the Company's Stock tendered or forfeited as
payment of the amount to be withheld under applicable income tax laws in
connection with the exercise of the Option to which such "reload" option
relates. "Reload" options may be granted with respect to Options granted under
this Plan. Such "reload" options shall have a per share exercise price equal to
the Fair Market Value as of the date of grant of the new Option.
3.6 Vesting. Eligible Individuals shall vest in all Options in accordance
with the terms and conditions of the Agreement entered into by and between the
Eligible Individual and the Company.
3.7 Option Term. The term of each Option shall be fixed by the Board. In
the event that the Plan is terminated pursuant to terms and conditions of
Section 7, the Plan shall remain in effect as long as any Awards under it are
outstanding.
3.8 Performance Awards. The Board shall have the right to designate Awards
as "Performance Awards." The grant or vesting of a Performance Award shall be
subject to the achievement of performance objectives established by the Board
based on one or more of the following criteria, in each case applied to the
Company on a consolidated basis and/or to a business unit and which the Board
may use as an absolute measure, as a measure of improvement relative to prior
performance, or as a measure of comparable performance relative to a peer group
of companies: sales, operating profits, operating profits before interest
expenses and taxes, net earnings, earnings per share, return on equity, return
on assets, return on invested capital, total shareholder return, cash flow, debt
to equity ratio, market share, stock price, economic value added, and market
value added.
3.9 Restricted Stock. Subject to the following provisions, the Board may
grant Awards of Restricted Stock to an Eligible Individual in such form and on
such terms and conditions as the Board may determine:
(a) The Restricted Stock Award shall specify the number of shares of
Restricted Stock to be awarded, the price, if any, to be paid by
the Eligible Individual and the date or dates on which, or the
conditions upon the satisfaction of which, the Restricted Stock
will vest. The grant and/or the vesting of Restricted Stock may
be conditioned upon the completion of a specified period of
service with the Company or a Related Company, upon the
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attainment of specified performance objectives or upon such other
criteria as the Board may determine.
(b) Stock certificates representing the Restricted Stock awarded to
an Eligible Individual shall be registered in the Eligible
Individual's name, but the Board may direct that such
certificates be held by the Company or its designee on behalf of
the Eligible Individual. Except as may be permitted by the
Board, no share of Restricted Stock may be sold, transferred,
assigned, pledged or otherwise encumbered by an Eligible
Individual until such share has vested in accordance with the
terms of the Restricted Stock Award. At the time the Restricted
Stock vests, a certificate for such vested shares shall be
delivered to the Eligible Individual (or his or her designated
beneficiary in the event of death), free of all restrictions.
(c) The Board may provide that the Eligible Individual shall have the
right to vote or receive dividends on Restricted Stock. Unless
the Board provides otherwise, Stock received as a dividend on, or
in connection with a stock split of, Restricted Stock shall be
subject to the same restrictions as the Restricted Stock.
(d) Except as may be provided by the Board, in the event of an
Eligible Individual's termination of employment or relationship
with the Company prior to all of his or her Restricted Stock
becoming vested, or in the event any conditions to the vesting of
Restricted Stock have not been satisfied prior to any deadline
for the satisfaction of such conditions as set forth in the
Restricted Stock Award, the shares of Restricted Stock which have
not vested shall be forfeited, and the Board may provide that (i)
any purchase price paid by the Eligible Individual be returned to
the Eligible Individual or (ii) a cash payment equal to the
Restricted Stock's fair market value on the date of forfeiture,
if lower, be paid to the Eligible Individual.
(e) The Board may waive, in whole or in part, any or all of the
conditions to receipt of, or restrictions with respect to, any or
all of the Eligible Individual's Restricted Stock.
3.10 Tax Offset Payments. The Board may provide for a Tax Offset Payment
to be made by the Company to an Eligible Individual with respect to one or more
Awards granted under the Plan. The Tax Offset Payment shall be in an amount
specified by the Board, which shall not exceed the amount necessary to pay the
federal, state, local and other taxes payable with respect to the applicable
Award, assuming that the Eligible Individual is taxed at the maximum tax rate
applicable to such income. The Tax Offset Payment shall be paid solely in cash.
SECTION 4
OPERATION AND ADMINISTRATION
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4.1 General. The operation and administration of this Plan, including any
Awards granted under this Plan, shall be subject to the provisions of Section 4.
4.2 Effective Date. The Plan shall be effective as of March 6, 2000 (the
"Effective Date").
4.3 Shares Subject to Plan. The shares of Stock for which Awards may be
granted under this Plan shall be subject to the following:
(a) Subject to the following provisions of this Subsection 4.3, the
maximum aggregate number of shares of Stock that may be issued
and sold under the Plan shall be 1,000,000 shares of Stock. The
number of shares of Stock so reserved for issuance shall be
subject to adjustment pursuant to Sections 4.3(b) and 4.3(d).
The shares of Stock may be authorized, but unissued, or
reacquired Stock.
(b) On January 1st of each year, commencing with year 2001, the
aggregate number of shares of Stock that may be awarded under the
Plan shall automatically increase by the lesser of (a) 300,000
shares of Stock, (b) 3.5% of the outstanding shares of Stock on
such date, or (c) a lesser amount determined by the Committee.
(c) To the extent an Award terminates without having been exercised,
or shares awarded are forfeited, such shares shall again be
available for issue under the Plan. Shares of Stock equal in
number to the shares surrendered in payment of the Exercise
Price, and shares of Stock which are withheld in order to satisfy
federal, state or local tax liability, shall not count against
the maximum aggregate number of shares authorized to be issued
pursuant to this Plan, and shall again be available for issuance.
(d) In the event of any merger, reorganization, consolidation, sale
of substantially all assets, recapitalization, stock dividend,
stock split, combination or reverse stock split, spin-off, split-
up, split-off, distribution of assets or other change in
corporate structure affecting the Stock, a substitution or
adjustment, as may be determined to be appropriate by the Board
in its sole discretion, shall be made in the aggregate number of
shares reserved for issuance under the Plan, the number of shares
as to which Awards may be granted to any individual in any fiscal
year, the number of shares subject to outstanding awards and the
amounts to be paid by Award holders or the Company, as the case
may be, with respect to outstanding Awards; provided, however,
that no such adjustment shall exceed the aggregate value of any
outstanding Award prior to such substitution or adjustment. The
Board may make such other adjustments as it deems appropriate.
(e) No Eligible Individual shall be granted Options, Restricted
Stock, or any combination thereof with respect to more than
_____________ shares of
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Stock in any fiscal year (subject to adjustment as provided in
Section 4.3(d).
4.4 Securities Laws Restrictions. Issuance of shares of Stock or other
amounts under the Plan shall be subject to the following:
(a) If at any time the Board determines that the issuance of Stock
under the Plan is or may be unlawful under the laws of any
applicable jurisdiction, the right to exercise any Stock Option
or receive any Restricted Stock shall be suspended until the
Board determines that such issuance is lawful. The Company shall
have no obligation to effect any registration of qualification of
the Stock under federal or state laws.
(b) Any person exercising a Stock Option or receiving Restricted
Stock shall make such representations (including representations
to the effect that such person will not dispose of the Stock so
acquired in violation of federal and state securities laws) and
furnish such information as may, in the opinion of counsel for
the Company, be appropriate to permit the Company to issue the
Stock in compliance with applicable federal and state securities
laws. The Board may refuse to permit the exercise of a Stock
Option or issuance of such Restricted Stock until such
representations and information have been provided.
(c) The Company may place an appropriate legend evidencing any
transfer restrictions on all shares of Stock issued under the
Plan and may issue stop transfer instructions in respect thereof.
(d) To the extent that the Plan provides for issuance of stock
certificates to reflect the issuance of shares of Stock, the
issuance may be effected on a non-certificated basis, to the
extent not prohibited by applicable law or the applicable rules
of any stock exchange.
4.5 Tax Withholding. Each Eligible Individual shall, no later than the
date as of which the value of an Award first becomes includible in such person's
gross income for applicable tax purposes, pay, pursuant to such arrangements as
the Company may establish from time to time, any federal, state, local or other
taxes of any kind required by law to be withheld with respect to the Award. The
obligations of the Company under the Plan shall be conditional on such payment,
and the Company (and, where applicable, any Related Company), shall, to the
extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to the Eligible Individual.
4.6 Payments. Awards may be settled in any of the methods described in
Section 3.4. Any Award settlement, including payment deferrals, may be subject
to such conditions, restrictions and contingencies as the Board shall determine.
The Board may permit or require the deferral of any Award payment, subject to
such rules and procedures as it may establish, which may include provisions for
the payment or crediting of interest, or dividend equivalents, including
converting such credits into deferred Stock equivalents. Each Related Company
shall be liable for payment of
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cash due under the Plan with respect to any Eligible Individual to the extent
that such benefits are attributable to the services rendered for that Related
Company by the Eligible Individual. Any disputes relating to liability of a
Related Company for cash payments shall be resolved by the Board.
4.7 Transferability. Except as otherwise provided by the Board, Awards
under the Plan may not be sold, pledged, assigned, hypothecated, transferred, or
disposed of in any manner other than by beneficiary designation, will or by the
laws of descent and distribution. If the Board makes an Award transferrable,
the Award Agreement shall set forth such additional terms and conditions
regarding transferability as the Board deems appropriate.
4.8 Form and Time of Elections. Unless otherwise specified herein, each
election required or permitted to be made by any Eligible Individual or other
person entitled to benefits under the Plan, and any permitted modification, or
revocation thereof, shall be in writing filed with the Board at such times, in
such form, and subject to such restrictions and limitations, not inconsistent
with the terms of the Plan, as the Board shall require.
4.9 Agreement With Company. An Award under the Plan shall be subject to
such terms and conditions, not inconsistent with the Plan, as the Board shall,
in its sole discretion, prescribe. The terms and conditions of any Award to any
Eligible Individual shall be reflected in an Award Agreement executed by the
parties, a copy of which shall be provided to the Eligible Individual.
4.10 Limitation of Implied Rights.
(a) Neither an Eligible Individual nor any other person shall, by
reason of participation in the Plan, acquire any right in or
title to any assets, funds or property of the Company or any
Related Company whatsoever, including, without limitation, any
specific funds, assets, or other property which the Company or
any Related Company, in its sole discretion, may set aside in
anticipation of a liability under the Plan. An Eligible
Individual shall have only a contractual right to the Stock or
amounts, if any, payable under the Plan, unsecured by any assets
of the Company or any Related Company, and nothing contained in
the Plan shall constitute a guarantee that the assets of the
Company or any Related Company shall be sufficient to pay any
benefits to any Eligible Individual.
(b) This Plan does not constitute a contract of employment, and
selection as a Eligible Individual will not give the Eligible
Individual the right to be retained in the employ of the Company
or any Related Company, nor any right or claim to any future
grants or to any benefit under the Plan, unless such right or
claim has specifically accrued under the terms of the Plan.
Except as otherwise provided in the Plan, no Award under the Plan
shall confer upon an Eligible Individual any rights of a
shareholder of the Company prior to the date on which the
Eligible Individual fulfills all conditions for receipt of such
rights.
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4.11 Evidence. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which the person acting on
it considers pertinent and reliable, and signed, made or presented by the proper
party or parties.
4.12 Termination for Cause. If the employment of an Eligible Individual
is terminated by the Company or a Related Company for "cause," then the Board
shall have the right to cancel any Options granted to the Eligible Individual
under the Plan. The term "cause" shall mean (1) the Eligible Individual's
violation of any provision of any non-competition agreement or confidentiality
agreement with the Company; (2) an illegal or negligent action by the Eligible
Individual that materially and adversely affects the Company; (3) the Eligible
Individual's failure or refusal to perform his/her duties (except when prevented
by reason of illness or disability); or (4) conviction of the Eligible
Individual of a felony involving moral turpitude.
SECTION 5
CHANGE IN CONTROL
In the event of a Change in Control, if so determined by the Board and
specifically documented in either a special form of Award Agreement at the time
of grant or amendment to an existing Award Agreement, in each case on an
individual-by-individual basis:
(a) all or a portion (as determined by the Board) of outstanding
Stock Options awarded to such individual under the Plan shall
become fully exercisable and vested; and
(b) the restrictions applicable to all or a portion (as determined by
the Board) of any outstanding Restricted Stock awards under the
Plan held by an Eligible Individual shall lapse and such shares
shall be deemed fully vested.
Notwithstanding the foregoing, no acceleration of vesting or termination of
restrictions on Restricted Stock shall occur if (a) all Awards are assumed by a
surviving corporation or its parent or (b) the surviving corporation or its
parent substitutes Awards with substantially the same terms for such Awards.
The Board shall have the right to cancel Awards in the event of a Change in
Control, provided that in exchange for such cancellation, the Eligible
Individual shall receive a cash payment equal to the Change in Control
consideration less the exercise price of the Awards.
SECTION 6
COMMITTEE
6.1 Administration. The Plan shall be administered by the Compensation
Committee of the Board or such other committee of Directors as the Board may
designate, which shall consist of not less than two Non-Employee Directors, and
the Committee may administer the Plan and exercise all of the rights and powers
granted to the Board hereunder, including, without limitation, the right to
grant Options pursuant to the Plan and to establish the Exercise Price as
provided in the Plan. The
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members of the Committee shall serve at the pleasure of the Board. To the extent
that the Board determines it to be desirable to qualify Awards granted hereunder
as "performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee of two or more "outside
directors" within the meaning of Section 162(m) of the Code. To the extent that
the Board determines it to be desirable to qualify Awards as exempt under Rule
16b-3, the Award transactions contemplated hereunder shall be structured to
satisfy the requirements for exemption under Rule 16b-3. All determinations made
by the Board pursuant to the provisions of the Plan shall be final and binding
on all persons, including the Company and Eligible Individuals. The Board may
administer the Plan or exercise any or all of the administration duties of the
Board at any time when a Committee meeting the requirements of this Section has
not been appointed or serving, and the Board may exempt Awards pursuant to Rule
16b-3(d)(1) of the Exchange Act.
6.2 Powers of Board. The Board shall have the following authority with
respect to Awards under the Plan: to grant Awards; to adopt, alter and repeal
such administrative rules, guidelines and practices governing the Plan as it
shall deem advisable; to interpret the terms and provisions of the Plan and any
Award granted under the Plan; and to otherwise supervise the administration of
the Plan. In particular, and without limiting its authority and powers, the
Board shall have the authority:
(a) to determine whether and to what extent any Award or combination
of Awards will be granted hereunder;
(b) to select the Eligible Individuals to whom Awards will be
granted;
(c) to determine the number of shares of Stock to be covered by each
Award granted hereunder subject to the limitations contained
herein;
(d) to determine the terms and conditions of any Award granted
hereunder, including, but not limited to, any vesting or other
restrictions based on such performance objectives and such other
factors as the Board may establish, and to determine whether the
performance objectives and other terms and conditions of the
Award are satisfied;
(e) to determine the treatment of Awards upon the Eligible
Individual's retirement, disability, death, termination for cause
or other termination of employment or service;
(f) to determine that amounts equal to the amount of any dividends
declared with respect to the number of shares covered by an Award
(i) will be paid to the Eligible Individual currently or (ii)
will be deferred and deemed to be reinvested or (iii) will
otherwise be credited to the Eligible Individual or that the
Eligible Individual has no rights with respect to such dividends;
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(g) to amend the terms of any Award, prospectively or retroactively;
provided, however, that no amendment shall impair the rights of
the Eligible Individual without his or her written consent; and
(h) to substitute new Stock Options for previously granted Stock
Options, or for options granted under other plans or agreements,
in each case including previously granted options having higher
option prices.
Determinations by the Board under the Plan relating to the form, amount, and
terms and conditions of Awards need not be uniform, and may be made selectively
among Eligible Individuals who receive Awards under the Plan, whether or not
such Eligible Individuals are similarly situated.
6.3 Delegation by Board. Except to the extent prohibited by applicable
law or the applicable rules of a stock exchange, the Board may allocate all or
any portion of its responsibilities and powers to any one or more of its members
and may delegate all or any part of its responsibilities and powers to any
person or persons selected by it. Any such allocation or delegation may be
revoked by the Board at any time.
6.4 Information to be Furnished to Board. The Company and any Related
Company shall furnish the Board with such data and information as it determines
may be required for it to discharge its duties. The records of the Company and
any Related Company as to an Eligible Individual's employment, termination of
employment, leave of absence, reemployment and compensation shall be conclusive
on all persons unless determined to be incorrect. Eligible Individuals and
other persons entitled to benefits under the Plan must furnish the Board such
evidence, data or information as the Board considers desirable to carry out the
terms of the Plan.
6.5 Non-Liability of Board and Committee. No member of the Board or the
Committee, nor any officer or employee of the Company acting on behalf of the
Board or the Committee, shall be personally liable for any action, determination
or interpretation taken or made with respect to the Plan, and all members of the
Board or the Committee and all officers or employees of the Company acting on
their behalf shall, to the extent permitted by law, be fully indemnified and
protected by the Company with respect to any such action, determination or
interpretation.
SECTION 7
AMENDMENT AND TERMINATION
The Board may, at any time, amend or terminate the Plan, provided that no
amendment or termination may, in the absence of written consent to the change by
the affected Eligible Individual (or, if the Eligible Individual is not then
living, the affected beneficiary), adversely affect the rights of any Eligible
Individual or beneficiary under any Award granted under the Plan prior to the
date such amendment is adopted by the Board; provided that adjustments made
pursuant to Subsection 4.3(d) shall not be subject to the foregoing limitations
of this Section 7. An amendment shall be subject to approval by the Company's
shareholders only to the extent required by applicable laws, regulations or
rules of a stock exchange or similar entity.
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SECTION 8
INVESTMENT PURPOSES
Unless a registration statement under the Securities Act of 1933, as
amended (the "Act") is in effect with respect to Stock to be purchased upon
exercise of Options to be granted under the Plan, the Company shall require that
the Eligible Individual agree with and represent to the Company in writing that
he or she is acquiring such shares of Stock for the purpose of investment and
with no present intention to transfer, sell or otherwise dispose of such shares
of Stock other than by transfers which may occur by will or by the laws of
descent and distribution, and no shares of Stock may be transferred unless, in
the opinion of counsel to the Company, such transfer would be in compliance with
applicable securities laws. In addition, unless a registration statement under
the Act is in effect with respect to the Stock to be purchased under the Plan,
each certificate representing any shares of Stock issued to the Eligible
Individual hereunder shall have endorsed thereon a legend in substantially the
following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED WITHOUT
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT") AND WITHOUT REGISTRATION UNDER ANY APPLICABLE STATE
SECURITIES LAWS, IN RELIANCE UPON EXEMPTION(S) CONTAINED THEREIN.
NO TRANSFER OF THESE SHARES OR ANY INTEREST THEREIN MAY BE MADE
EXCEPT PURSUANT TO EFFECTIVE REGISTRATION UNDER SAID LAWS UNLESS
THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO IT
THAT SUCH TRANSFER OR DISPOSITION DOES NOT REQUIRE REGISTRATION
UNDER SAID LAWS AND, FOR ANY SALES UNDER RULE 144 OF THE ACT,
SUCH EVIDENCE AS IT SHALL REQUEST FOR COMPLIANCE WITH THAT RULE,
OR APPLICABLE STATE SECURITIES LAWS.
SECTION 9
GENERAL PROVISIONS
9.1 Award Agreements. No Eligible Individual will have rights under an
Award granted to such Eligible Individual unless and until an Agreement has been
duly executed on behalf of the Company and the Eligible Individual.
9.2 No Limit on Other Compensation Arrangements. Nothing contained in the
Plan shall prevent the Company or any Related Company from adopting or
continuing in effect other or additional compensation arrangements, and such
arrangements may be either generally applicable or applicable only in specific
cases.
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9.3 Headings. The headings of the sections and subsections of this Plan
are intended for the convenience of the parties only and shall in no way be held
to explain, modify, construe, limit, amplify or aid in the interpretation of the
provisions hereof.
9.4 Beneficiaries. An Eligible Individual may, from time to time, name
any beneficiary or beneficiaries (who may be named contingently or successively)
to whom any benefit under the Plan may be paid or transferred in case of death.
Each designation will revoke all prior designations, shall be in a form
prescribed by the Board, and will be effective only when filed by the Eligible
Individual in writing with the Board during his or her lifetime. In the absence
of any such designation, benefits outstanding at the Eligible Individual's death
shall be paid or transferred to his or her estate. There shall be no third party
beneficiaries of or to this Plan. Any beneficiary of the Eligible Individual
shall have only a claim to such benefits as may be determined to be payable
hereunder, if any, and shall not, under any circumstances other than the right
to claim such benefits, be deemed a third party beneficiary of or to this Plan.
9.5 Governing Law. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of Minnesota,
except to the extent preempted by federal law, without regard to the principles
of comity or the conflicts of law provisions of any jurisdiction.
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