<PAGE> 1
<TABLE>
<S> <C>
As filed with the Securities and Exchange Commission on June 11, 1997 Registration No. 333-______________
</TABLE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
----------------------------------
RESPONSE ONCOLOGY, INC.
(Exact name of registrant as specified in its charter)
TENNESSEE 62-1212264
(State of Incorporation) (I.R.S. Employer
Identification No.)
1775 Moriah Woods Blvd.
Memphis, Tennessee 38117
(Address of principal executive offices)
RESPONSE ONCOLOGY, INC. 1996 STOCK INCENTIVE PLAN
(Full Title of the Plan)
MARY E. CLEMENTS
Executive Vice President, Finance
Response Oncology, Inc.
1775 Moriah Woods Blvd.
Memphis, Tennessee 38117
(901) 761-7000
(Name, address and telephone number of agent for service)
(with copies to:)
JOHN A. GOOD
Baker, Donelson, Bearman & Caldwell
165 Madison Avenue, 2000 First Tennessee Building
Memphis, Tennessee 38103
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
============================================================================================================================
Proposed Maximum Proposed Maximum
Title of Securities to Amount to be Offering Price Per Aggregate Offering Amount of
be Registered Registered Share Price Registration Fee
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 1,130,000 shares (1) $6.5 (2) $7,345,000 (2) $2,296 (1)(2)
============================================================================================================================
</TABLE>
(1) This figure represents the number of shares of Common Stock registered
hereby for purchase by employees under the Response Oncology, Inc.
1996 Stock Incentive Plan (the "Plan"). There are also registered an
undetermined number of additional shares of Common Stock that may
become available for purchase in accordance with the provisions of the
Plan in the event of certain changes in the outstanding shares of
Common Stock of the Company, including a stock dividend or stock
split.
(2) Estimated solely for the purpose of determining the amount of the
registration fee. Such estimate has been calculated in accordance with
Rule 457(h) under the Securities Act of 1933, as amended, and are
based upon the average high and low sales prices of the Registrant's
Common Stock as reported on the National Market of The Nasdaq Stock
Market on June 3, 1997.
Pursuant to Rule 462 of the 1933 Act, the Registration Statement on
Form S-8 shall be effective upon filing with the Commission.
<PAGE> 2
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission are
incorporated herein by reference:
1. The Registrant's Annual Report on Form 10-K for the year ended December 31,
1996.
2. The Registrant's Quarterly Report on Form 10-Q for the quarter ended March
31, 1997; and
3. The description of the Registrant's Common Stock contained in its
Registration Statement on Form 8-A filed by the Registrant to register the
Common Stock under the Exchange Act, including all amendments and reports filed
for the purpose of updating such description prior to the termination of the
offering of the Common Stock offered hereby.
All documents subsequently filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the 1934 Act, prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part thereof from the date of
filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
No response is required to this item.
<PAGE> 3
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
No response is required to this item.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company is incorporated under the laws of the State of Tennessee.
Under the Tennessee Business Corporation Act (the "Corporation Act") including,
without limitation, Sections 48-18-501 through 48-18-509, a Tennessee
corporation may indemnify its directors who are, or may be a party to any
proceeding, whether civil, criminal, administrative or investigative, for
character of the proceeding, against expenses (including attorneys' fees),
judgments, fines and amount paid in settlement actually and reasonably incurred
by such person in connection with such proceeding, provided such person acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the corporation's best interests and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his conduct was illegal. A
Tennessee corporation may indemnify any person who is a party to any action or
suit by or in the right of the corporation by reason of the fact that such
person was a director, officer, employee or agent of such corporation, or is or
was serving at the request of such corporation as a director, officer, employee
or agent of another corporation or enterprise. The indemnity may include
expenses (including attorneys' fees) actually and reasonably incurred by such
person in connection with the defense or settlement of such action or suit,
provided such person acted in good faith and in a manner he reasonably believed
to be in or not opposed to the corporation's best interests except that no
indemnification is permitted without judicial approval if the officer or
director is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in the defense of any action
referred to above, the corporation must indemnify him against the expenses
which such officer or director has actually and reasonably incurred.
Article IX of the Company's Bylaws provides for the indemnification
of directors and officers of the Company to the fullest extent permitted by the
laws of the State of Tennessee, as now in effect and as hereafter provided.
Article Eight of the Company's Charter provides that the directors of the
Company shall not be personnally liable to the Company or to its stockholders
for monetary damages for breach of fiduciary duty as a director.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
No response is required to this item.
- 3 -
<PAGE> 4
ITEM 8. EXHIBITS
<TABLE>
<CAPTION>
Exhibit Number Description
- -------------- -----------
<S> <C>
4(a)* Charter of the Company (incorporated herein by reference to Exhibit 3(a) to the Company's Annual Report on Form
10-K for the fiscal year ended April 30, 1989.
4(b)* Bylaws of the Company (incorporated herein by reference to Exhibit 3(b) to Registration Statement on Form S-1
(Commission File No. 33-5016)).
4(c)* Trust Indenture, Deed of Trust and Security Agreement dated April 3, 1990 (incorporated herein by reference to
Exhibit 4 to the Company's Annual Report on Form 10-K for the fiscal year ended April 30, 1990 (Commission File
No. 0-15416).
4(d) Form of Stock Option Agreement to be entered into with respect to Incentive Stock Options.
5 Opinion and Consent of Baker, Donelson, Bearman & Caldwell
10(a) Response Oncology, Inc. 1996 Stock Incentive Plan
10(b) Amendment No. 1 to Response Oncology, Inc. 1996 Stock Incentive Plan.
24(a) Consent of Baker, Donelson, Bearman & Caldwell (contained in Exhibit 5)
24(b) Consent of KPMG Peat Marwick LLP
25 Power of Attorney (Included on signature page)
</TABLE>
* Incorporated by reference to the Company's Registration Statement on
Form S-8 Commission File No. 33-45616, filed with the Commission on
February 11, 1992.
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement 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.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933 (the "1933 Act"), each such posteffective 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.
(3) 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.
- 4 -
<PAGE> 5
(b) The undersigned registrant hereby undertakes that, for the purposes
of determining any liability under the 1933 Act, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Act) 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.
(c) Insofar as indemnification for liabilities arising under the 1933
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 1933 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
director, officer or controlling person in connection with the 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 1933 Act and will be governed by the final
adjudication of such issue.
- 5 -
<PAGE> 6
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 duly
authorized, in the City of Memphis, State of Tennessee, on the 30th day of
May, 1997.
RESPONSE ONCOLOGY, INC.
By: /s/ Joseph T. Clark
----------------------------------
Joseph T. Clark,
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Joseph T. Clark and Mary E. Clements and
each of them, with full power to act without the other, his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments to this Registration Statement, 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 fully to all intents and purposes as
he might or could do in person thereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his substitutes or
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
NAME TITLE DATE
- ----------------------------------- ---------------------------------------------------- ----------------
<S> <C> <C>
/s/ William H. West, M.D. Chairman of the Board and Director May 30, 1997
- -----------------------------------
William H. West, M.D.
/s/ Frank Bumstead Vice Chairman and Director May 30, 1997
- -----------------------------------
Frank Bumstead
/s/ Joseph T. Clark Chief Executive Officer and Director May 30, 1997
- ----------------------------------- (Principal Executive Officer)
Joseph T. Clark
/s/ Mary E. Clements Executive Vice President, Finance (Principal May 30, 1997
- ------------------------------------ Financial and Accounting Officer) and
Mary E. Clements Secretary
/s/ P. Anthony Jacobs Director May 30, 1997
- ------------------------------------
P. Anthony Jacobs
/s/ W. Thomas Grant, II Director May 30, 1997
- ------------------------------------
W. Thomas Grant, II
/s/ James R. Seward Director May 30, 1997
- ------------------------------------
James R. Seward
/s/ Leonard Kalman, M.D.
____________________________________ Director May 30, 1997
Leonard Kalman, M.D.
/s/ Lawrence Kugelman
____________________________________ Director May 30, 1997
Lawrence Kugelman
/s/ Jack O. Bovender Director May 30, 1997
- ------------------------------------
Jack O. Bovender
</TABLE>
- 6 -
<PAGE> 1
EXHIBIT 4(d)
FORM OF STOCK OPTION AGREEMENT
4(d)-1
<PAGE> 2
RESPONSE ONCOLOGY, INC.
1996 STOCK INCENTIVE PLAN
GRANT OF INCENTIVE STOCK OPTIONS
Date of Grant: ________________, 1996
THIS GRANT, dated as of the date of grant first stated above (the
"Date of Grant"), is delivered by Response Oncology, Inc., a Tennessee
corporation (the "Company") to ________ (the "Grantee"), who is an officer and
employee of the Company.
WHEREAS, the Board of Directors of the Company (the "Board") on
December 13, 1995, adopted the Company's 1996 Stock Incentive Plan (the
"Plan"), which was approved by the shareholders at the Annual Meeting of the
shareholders of the Company held on May 16, 1996;
WHEREAS, the Plan provides for the granting of stock awards, which may
include non-qualified or incentive stock options, restricted stock, and/or
stock appreciation rights, by the Compensation Committee of the Board (the
"Committee") to employees, advisors, consultants, or outside directors of the
Company to purchase, or to exercise certain rights with respect to, shares of
the Common Stock of the Company, par value $.01 per share (the "Common Stock"),
in accordance with the terms and provisions thereof; and
WHEREAS, the Committee considers the Grantee to be a person who is
eligible for a grant of incentive stock options under the Plan, and has
determined that it would be in the best interest of the Company to grant the
incentive stock options documented herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows with respect to the grant described herein.
Capitalized terms not otherwise defined herein shall have the meanings ascribed
to such terms in the Plan.
1. GRANT OF OPTION AND STOCK APPRECIATION RIGHTS.
Subject to approval of the Plan by the shareholders of the Company and
to the terms and conditions of the Plan and as hereinafter set forth, the
Company, with the approval and at the direction of the Committee, hereby grants
to the Grantee, as of the Date of Grant, an option to purchase up to _________
shares of Common Stock at a price of $_____ per share, which the Committee has
determined in good faith to be the Fair Market Value of the Common Stock as of
the Date of Grant. Such option is hereinafter referred to as the "Option" and
the shares of stock purchasable upon exercise of the Option are hereinafter
sometimes referred to as the "Option Stock." The Option is intended by the
parties hereto to be, and shall be treated as, an Incentive Stock Option (as
such term is defined under Section 422 of the Code and in the Plan) to the
fullest extent permitted by the Code. Any portion of the Option not satisfying
the conditions related to Incentive Stock Options under said section of the
Code shall be deemed a Non-Qualified Stock Option under the Plan. In addition,
the Company, with the approval of the Committee, hereby grants, in tandem with
the Option, a SAR equal to the number of shares of Option Stock, which SAR
shall be exercisable at the same time and on the same terms and conditions as
the Option. If and to the extent the Grantee shall exercise the SAR granted
hereunder, then the number of shares of Option Stock subject to acquistion upon
exercise of the Option shall be decreased by the number of SARs exercised.
4(d)-2
<PAGE> 3
2. VESTING AND EXERCISE.
The Option and SARs granted pursuant to paragraph 1 of this Grant of
Incentive Stock Options shall vest 20% on the Date of Grant and 20% on each
anniversary of the Date of Grant until fully vested. In the event that the
Grantee's employment is voluntarily terminated or the Grantee shall suffer a
Termination with Cause, then the unexercised portion of the Option and SARs
shall no longer be exercisable, and the Option shall be forfeited by the
Grantee.
Subject to such further limitations as are provided herein, the Option
and SARs shall become exercisable in five (5) installments, the Grantee having
the right hereunder to purchase from the Company the following number of shares
of Option Stock upon exercise of the Option (or, in lieu thereof, cash upon
exercise of SARs), on and after the following dates:
Date Shares
Notwithstanding the foregoing, the Option and SARs shall automatically
vest and become immediately exercisable in the event of the Grantee's Death,
Disability or Retirement or in the event of a Change in Control or Imminent
Change in Control of the Company.
3. TERMINATION OF OPTION AND SARS.
The Option and SARs and all rights hereunder with respect thereto, to
the extent such rights shall not have been exercised, shall terminate and
become null and void after the expiration of ten (10) years from the Date of
Grant (the "Option Term"), unless terminated earlier pursuant to the terms of
this Option Grant.
4. EXERCISE OF OPTIONS AND SARS.
(a) The Grantee may exercise the Option or SARs with respect to all or
any part of the number of shares of Option Stock then exercisable hereunder by
giving the Secretary of the Company written notice of intent to exercise. The
notice of exercise shall specify the number of shares of Option Stock as to
which the Option is to be exercised, whether the exercise is of the Option or
SARS and the date of exercise thereof, which date shall be at least five (5)
days after the giving of such notice unless an earlier time shall have been
mutually agreed upon.
(b) Full payment in cash (in U.S. dollars) by the Grantee of the Option
Price for the shares of Option Stock purchased shall be made on or before the
exercise date specified in the notice of exercise of the Option. Upon receipt of
such payment, the Company shall cause to be delivered to the Grantee, a
certificate or certificates for the shares of Option Stock then being purchased
(out of theretofore unissued Stock or reacquired Stock, as the Company may
elect). The obligation of the Company to deliver the Option Stock shall,
however, be subject to the condition that if at any time the Committee shall
determine in its discretion that the listing, registration or qualification of
the Option or the shares of Option Stock upon any securities exchange or under
any state or federal law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in connection
with the Option or the issuance or purchase of shares of Option Stock
thereunder, the Option may not be exercised in whole or in part unless such
listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Committee. If
the exercise relates to SARs, then the Company will deliver to the Grantee cash
(in U.S. dollars) in the amount determined in accordance with rules or
procedures established by the Committee in respect of the exercise of SARs.
4(d)-3
<PAGE> 4
(c) If the Grantee fails to pay the Option Price for any of the shares
of Option Stock specified in such notice or fails to accept delivery thereof,
the Grantee's right to purchase such shares of Option Stock may be terminated by
the Company. The date specified in the Grantee's notice as the date of exercise
shall be deemed the date of exercise of the Option, provided that payment in
full of the Option Price for the shares of Option Stock to be purchased upon
such exercise shall have been received by such date.
5. ADJUSTMENT OF AND CHANGES IN COMMON STOCK OF THE COMPANY.
In the event of a reorganization, recapitalization, change of shares,
stock split, spin-off, stock dividend, reclassification, subdivision or
combination of shares, merger, consolidation, rights offering, or any other
change in the corporate structure of shares of capital stock of the Company, the
Committee shall have the sole and absolute discretion to make any adjustment as
it deems appropriate in the number and kind of shares of Common Stock or other
securities of the Company or any successor entity subject to the Option or in
the Exercise Price and other terms and conditions of the Option or in the number
of SARs and the pricing thereof; provided, however, that no such adjustment
shall give the Grantee any additional benefits under the Option or SARs.
6. NO RIGHTS OF SHAREHOLDERS.
Neither the Grantee nor any personal representative shall be, or shall
have any of the rights and privileges of, a shareholder of the Company with
respect to any shares of Option Stock purchasable or issuable upon the exercise
of the Option, in whole or in part, prior to the date of exercise of the Option.
7. NON-TRANSFERABILITY OF OPTION.
During the Grantee's lifetime, the Option hereunder shall be
exercisable only by the Grantee or any guardian or legal representative of the
Grantee, and the Option shall not be transferable except, in case of the death
of the Grantee, by will or the laws of descent and distribution, nor shall the
Option be subject to attachment, execution or other similar process. In the
event of (a) any attempt by the Grantee to alienate, assign, pledge, hypothecate
or otherwise dispose of the Option, except as provided for herein, or (b) the
levy of any attachment, execution or similar process upon the rights or interest
hereby conferred, the Company may terminate the Option by notice to the Grantee
and it shall thereupon become null and void.
8. AMENDMENT OF OPTION AND SARS.
The Option and SARs may be amended by the Board or the Committee at
any time (i) if the Board or the Committee determines, in its sole discretion,
that amendment is necessary or advisable in the light of any addition to or
change in the Internal Revenue Code of 1986 or in the regulations issued
thereunder, or any federal or state securities law or other law or regulation,
which change occurs after the Date of Grant and by its terms applies to the
Option; or (ii) other than in the circumstances described in clause (i), with
the consent of the Grantee.
9. NOTICE.
Any notice to the Company provided for in this instrument shall be
addressed to it in care of its Secretary at its executive offices at 1775
Moriah Woods Blvd., Memphis, Tennessee 38117, and any notice to the Grantee
shall be addressed to the Grantee at the current address shown on the payroll
records of the Company. Any notice shall be deemed to be duly given if and when
properly addressed and posted by registered or certified mail, postage prepaid.
4(d)-4
<PAGE> 5
10. INCORPORATION OF PLAN BY REFERENCE.
The Option and SARS are granted pursuant to the terms of the Plan, the
terms of which are incorporated herein by reference, and the Option and SARs
shall in all respects be interpreted in accordance with the Plan. The Committee
shall interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on the
parties hereto and any other person claiming an interest hereunder, with respect
to any issue arising hereunder or thereunder.
11. GOVERNING LAW.
The validity, construction, interpretation and effect of this
instrument shall exclusively be governed by and determined in accordance with
the law of the State of Tennessee except to the extent preempted by federal law.
IN WITNESS WHEREOF, the Company has caused its duly authorized
officers to execute this Grant of Incentive Stock Option and the Grantee has
placed his or her signature hereon, effective as of the Date of Grant.
RESPONSE ONCOLOGY, INC.
By:___________________________
Title:________________________
ACCEPTED AND AGREED TO:
By:___________________________
Grantee
4(d)-5
<PAGE> 1
EXHIBIT 5
OPINION AND CONSENT OF BAKER, DONELSON, BEARMAN & CALDWELL
5-1
<PAGE> 2
May 30, 1997
Response Oncology, Inc.
1775 Moriah Woods Blvd.
Memphis, Tennessee 38117
RE: 1996 Stock Incentive Plan
Gentlemen:
We have acted as securities counsel for Response Oncology, Inc., a
Tennessee corporation (the "Company"), in connection with the Company's
Registration Statement on Form S-8 (the "Registration Statement"), pursuant to
the Securities Act of 1933, as amended, relating to the Company's 1996 Stock
Incentive Plan (the "Plan"), as amended. This opinion is being furnished in
response to Item 601 of Regulation S-K and the instructions to Form S-8.
We are familiar with the proceedings to date with respect to the
proposed offering and have examined such records, documents and matters of law
and satisfied ourselves as to such matters of fact as we have considered
relevant for purposes of this opinion.
On the basis of the foregoing, we are of the opinion that:
1. The Company is a corporation duly organized and existing under the
laws of the State of Tennessee.
2. The Plan has been duly and validly authorized and adopted, and the
shares of Common Stock of the Company (the "Shares") that may be issued and
sold from time to time in accordance with the Plan have been duly authorized
for issuance and will, when issued, sold and paid for in accordance with the
Plan, be validly issued, fully paid and non-assessable.
The foregoing opinion is limited to the federal laws of the United
States and the laws of the State of Tennessee, and we are expressing no opinion
as to the effect of the laws of any other jurisdiction.
In rendering the foregoing opinion, we have relied to the extent we
deem such reliance appropriate as to certain matters on statements,
representations and other information obtained from public officials, officers
of the Company and other sources believed by us to be responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement, and to the reference to us in the Prospectus that is a
part of the Registration Statement. In giving such consent, we do not thereby
admit that we are in the category of persons whose consent is required under
Section 7 of the Act.
Very truly yours,
BAKER, DONELSON, BEARMAN & CALDWELL, a
a Professional Corporation
5-2
<PAGE> 1
EXHIBIT 10(a)
RESPONSE ONCOLOGY, INC. 1996 STOCK INCENTIVE PLAN
10a-1
<PAGE> 2
RESPONSE ONCOLOGY, INC.
1996 STOCK INCENTIVE PLAN
1. PURPOSE OF PLAN AND EFFECTIVE DATE.
1.1 PURPOSE. The purpose of this 1996 Stock Incentive Plan
(hereinafter called the "Plan") is to further the success and advance the
interests of Response Oncology, Inc. and its subsidiaries and affiliates,
including, without limitation, consolidated joint ventures (collectively, the
"Company," where the context so requires) by making available shares of common
stock of the Company, $.01 par value per share ("Common Stock") for purchase by
or grants to eligible directors, officers, advisors, medical directors,
consultants and key employees of the Company and thus to provide an additional
incentive to such personnel to exert maximum effort toward the success of the
Company and to give them a greater interest as shareholders in the success of
the Company and in maximizing shareholder value.
1.2 AWARDS. The Company intends this Plan to enable the Company to
issue pursuant hereto (i) incentive stock options ("Incentive Stock Options")
to purchase Common Stock, as such term is defined in Section 422 of the
Internal Revenue Code of 1986, as amended from time to time (the "Code"); (ii)
similar options to purchase Common Stock which will not, however, be qualified
as Incentive Stock Options (also known as "Non-Statutory" or "Non-Qualified"
stock options); (iii) shares of Common Stock that are subject to limitations
and restrictions as to encumbrance and transfer ("Restricted Stock"); and (iv)
stock appreciation rights ("SAR") pursuant to which a recipient may recognize
in cash the benefit from appreciation in the price of Common Stock.
1.3 EFFECTIVENESS. The Plan shall become effective on the date of
approval by the Board of Directors of the Company, which date is February 8,
1996; provided, however, that the Plan shall be subject to approval and
ratification by shareholders of the Company holding a majority of its voting
stock, voting in person or by proxy, at a meeting of shareholders to be held
within twelve months after February 8, 1996.
2. DEFINITIONS.
2.1 As used in this Plan, the following terms have the following
respective meanings:
"1933 Act" means the Securities Act of 1933, as amended from
time to time. References to any provision of the 1933 Act shall be
deemed to include successor provisions thereto and rules and
regulations thereunder.
"Award" means any grant of a Stock Option or SAR, and any award
of Restricted Stock under the Plan, whether singly, in combination, or
in tandem, to an Eligible Person by the Compensation Committee pursuant
to such terms, conditions, restrictions, and/or limitations, if any, as
the Compensation Committee may establish.
"Award Agreement" means a written agreement setting forth the
terms of an Award.
"Board" means the Board of Directors of the Company.
"Change in Control" means any transaction pursuant to which (i)
the Company merges with another corporation, limited partnership,
limited liability company or other business entity and is not the
surviving entity; (ii) substantially all of the Company's assets are
sold to persons or entities not affiliated with the Company; (iii)
shares of Common Stock are issued to or acquired by persons (as defined
in Section 13(d)(3) under the Securities Exchange Act of 1934), their
Affiliates and associates
10-2
<PAGE> 3
(as defined in Rule 12b-2 under the Securities Exchange Act of 1934)
not affiliated with the Company who, immediately after such issuance or
acquisition, own Common Stock comprising more than 20% of the number of
shares of Common Stock issued and outstanding immediately after such
issuance or acquisition; or (iv) any other transaction of a nature
similar to the foregoing.
"Code" means the Internal Revenue Code of 1986, as amended.
References to any provisions of the Code shall be deemed to include
successor provisions.
"Committee" shall mean the Compensation Committee of the Board
as from time to time constituted; provided, however, that for purposes
of administration of this Plan, no person shall be a member of the
Committee unless such person shall be a person who shall not cause
the Plan to fail the "disinterested administration" test set forth in
Rule 16-b3(c)(ii) under the Exchange Act.
"Common Stock" has the meaning set forth in SECTION 1.1 hereof.
"Company" means Response Oncology, Inc., and, where the
context so requires, such term shall include subsidiaries of Response
Oncology, Inc. and consolidated joint ventures in which Response
Oncology, Inc. is a party.
"Disability" shall have the meaning set forth in Section
22(e)(3) of the Code.
"Eligible Persons" means all persons described in SECTION 5
hereof who are eligible to receive Awards pursuant to this Plan.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time. References to any provision of the Exchange
Act shall be deemed to include successor provisions thereto and rules
and regulations thereunder.
"Fair Market Value" unless otherwise required by an applicable
provision of the Code, as of any date, means the mean between the high
and low sales price of the Common Stock on any exchange upon which the
Common Stock is traded or on the National Market of the Nasdaq Stock
Market on the date of an Award or, if there are no sales on said date,
then on the next prior business day on which there was a sale. If no
such sales price is available, then the price per share shall be
determined by the Committee. If the Committee, in its discretion, shall
determine that the average high and low sales price for a particular
day is not, due to low trading volume or other factors which the
Committee deems appropriate, indicative of Fair Market Value, then the
Committee may use an average of the high and low sales prices of the
Common Stock over a period not to exceed thirty (30) trading days
immediately preceding the date of the Award in determining Fair Market
Value.
"Imminent Change in Control" means any offer or announcement,
oral or written, by any person or persons acting as a group, the
intention of whom is to effect a Change in Control of the Company. The
decision of the Committee whether an Imminent Change in Control has
occurred shall be conclusive and binding.
"Incentive Stock Option" means any Incentive Stock Option
granted pursuant to this Plan which is intended to be, and designated
and qualifying as, an "incentive stock option" within the meaning of
Section 422 of the Code.
"Modification" means any change in the terms of an Option which
would constitute a "modification" as defined in Section 424(h)(3) of
the Code, including, without limitation, such a modification to an
Option as effected by a change in the Plan and any other change in the
Plan which would increase the number of shares reserved for Options
under the Plan, materially change the
10-3
<PAGE> 4
administration of the Plan or that would otherwise materially increase
the benefits accruing to, or available for, participants in the Plan;
provided, however, that registration of Option Stock under the 1933
Act, as amended, shall not be deemed a Modification.
"Non-Statutory Stock Option" and "Non-Qualified Stock Option"
means any option granted under this Plan other than an Incentive Stock
Option.
"Option" or "Stock Option" means a right granted pursuant to
the Plan to purchase shares of Common Stock, and includes the terms
Incentive Stock Option and Non-Qualified Stock Option.
"Option Price" or "Exercise Price" means the price per share
at which Common Stock may be purchased upon the exercise of an Option.
"Option Stock" means Common Stock subject to an option granted
under this Plan.
"Participant" means any individual to whom an Option has been
granted by the Committee under the Plan.
"Restricted Stock" means Common Stock issued to a Participant
that is subject to restrictions on transfer or alienation, vesting and
forfeitability provisions and such other terms and conditions as the
Committee may determine and as may be set forth in an Award Agreement
in respect thereof.
"Retirement" means retirement from active employment under a
retirement plan of the Company, or pursuant to an employment agreement
with any of the aforementioned, or termination of employment at or
after age 65 under circumstances which the Committee, in its sole
discretion, deems equivalent to retirement.
"SAR" means a right to surrender to the Company all or a
portion of a Stock Option and to be paid therefor an amount, in cash or
shares of Common Stock (which may be Restricted Stock), as determined
by the Committee, provided that the amount of cash or the Fair Market
Value of any Common Stock, as the case may be, shall be no greater than
the excess, if any, of (i) the Fair Market Value of the Option Stock to
which the Option or portion thereof relates, determined on the date
such right is exercised, over (ii) the aggregate Option Price of the
Option Stock.
"Subsidiary" or "Subsidiaries" means any corporation which is
a "subsidiary corporation" as defined in Section 424(f) of the Code,
and the regulations thereto.
"Tax Date" means the date on which the amount of tax to be
withheld with respect to any Award is determined.
"Termination for Cause" shall have the same meaning as in any
employment agreement between any Participant and the Company, or, in
the absence of such employment agreement, shall mean the termination of
employment of a Participant due to (i) any illegal or dishonest conduct
which adversely affects or may adversely affect the reputation, good
will, or business position of the Company or which involves Company
funds or assets; (ii) any intentional or material damage to property or
business of the Company; (iii) theft, embezzlement or misappropriation
of the Company's property; or (iv) the willful failure of the
Participant to carry out his or her duties as an employee of the
Company.
10-4
<PAGE> 5
"10% Shareholder" means a person who owns stock possessing
more than 10% of the total combined voting power of all classes of
stock of Company or of any parent or subsidiary of the Company after
giving effect to the attribution of stock ownership provisions of
Section 424(d) of the Code.
2.2 References in these definitions to provisions of the Code
shall, when appropriate to effectuate the purpose of this Plan, be deemed to be
references to such provisions of the Code and regulations promulgated
thereunder as the same may be from time to time amended or to successor
provisions to such provisions. Terms defined elsewhere in this Plan shall have
the meanings set forth in such respective definitions.
3. STOCK SUBJECT TO PLAN.
3.1 NUMBER OF SHARES. Subject to the provisions of SECTION 12
hereof, there shall be reserved for issuance or transfer in connection with
Restricted Stock or SAR Awards or upon the exercise of the Options to be
granted from time to time under the Plan an aggregate of 630,000 shares of
Common Stock.
3.2 EXCESS SHARES. Shares of stock which are attributable to
Restricted Stock, SARs or Options which expire or are otherwise terminated,
cancelled, surrendered or forfeited, during a calendar year, are available for
issuance or use in connection with future Awards or the exercise of Options
beginning in the calendar year in which they expire or otherwise become
available.
3.3 SOURCE OF STOCK. Shares of Common Stock to be issued under the
Plan may be authorized and unissued shares of Common Stock, treasury stock or a
combination thereof.
3.4 ADJUSTMENT. In the event of a merger, consolidation,
reorganization, recapitalization, stock split, stock dividend, other
extraordinary dividend or other change in corporate structure or capitalization
affecting the Common Stock, the Committee may, in its discretion, make
appropriate adjustment in the number or kind of shares subject to Options or
SARs granted under the Plan, and/or the exercise price and other terms and
conditions of Options or SARs or appropriate adjustment in the maximum number
of shares referred to in SECTION 3.1 of the Plan, as provided in SECTION 12
hereof.
4. ADMINISTRATION.
4.1 COMPOSITION OF COMMITTEE. The Plan shall be administered by
the Committee which at all times shall be comprised solely of disinterested
persons (as defined by Rule 16b-3(c)(ii) promulgated under the Exchange Act)
each of who shall be a member of the Board, and appointed by the Board, as
constituted from time to time. Members of the Committee shall serve until they
resign or they are removed by the vote of a majority of the Board.
4.2 AUTHORITY OF COMMITTEE. The Committee shall have the authority
to (a) establish such rules and regulations as it deems necessary for the proper
operation and administration of the Plan; (b) select the persons to receive
Awards under the Plan; (c) determine the form of an Award and whether, if such
Award is an Option, such Option is to operate on a tandem basis and/or in
conjunction with or apart from other Awards made by the Company, either within
or outside of this Plan; (d) determine the number of shares of Common Stock to
be covered by each Award hereunder; (e) determine the terms and conditions, not
inconsistent with the terms of this Plan, of any Award hereunder (including, but
not limited to, any restriction
10-5
<PAGE> 6
or limitation on transfer, any vesting schedule or acceleration thereof, any
forfeiture provision or waiver thereof and any "reload" upon exercise of any
Option granted), regarding any Award and the shares of Common Stock relating
thereto, based on such factors as the Committee shall determine, in its sole
and absolute discretion; and (f) make any other determination or take any
action that the Committee deems necessary or desirable for the administration
of the Plan.
4.3 DECISIONS OF COMMITTEE FINAL. All decisions, determinations
and interpretations of the Committee shall be final and conclusive on all
persons affected thereby.
5. ELIGIBILITY.
Incentive Stock Options under this Plan may be granted only to officers
(who are employees) and to other employees of the Company and Subsidiaries, as
determined by the Committee. A director of the Company may receive an Incentive
Stock Option under this Plan only if such person is otherwise an employee of the
Company or a Subsidiary. In addition, employees, directors or officers of the
Company (including Subsidiaries and other affiliates, including consolidated
joint ventures), consultants, non-employee directors of the Company and advisors
who the Committee determines are providing bona fide services to the Company,
whether or not otherwise compensated, may receive any form of Award except an
Incentive Stock Option at the discretion of the Committee. In determining the
persons to whom Awards shall be made and the number of shares to be covered by
each Award, the Committee may take into account the nature of the services
rendered by, and the responsibilities borne by, such eligible persons, their
present and potential contributions to the Company's success and such other
factors as the Committee in its discretion shall deem relevant. Subject to the
provisions of SECTION 7 hereof, Awards may be made to persons who hold or have
held options, restricted stock and/or stock appreciation rights under previous
plans, and a person who has received an Award under the Plan may receive
additional Awards under the Plan or under any future stock or option plan if the
Committee shall so determine.
6. AWARDS UNDER THE PLAN.
6.1 TERM OF PLAN. The Committee may award Incentive Stock Options,
Non-Qualified Stock Options, Restricted Stock, SARs or any combination of the
foregoing to such Eligible Persons, in such amounts and subject to such terms
and conditions, as the Committee shall determine in its sole discretion, subject
to the provisions of the Plan, provided, however, that in no event may any Stock
Option be granted hereunder after the expiration of 10 years after the date of
the Plan. The automatic or discretionary grant of "reload" Stock Options is
specifically authorized.
6.2 CODE COMPLIANCE. In the case of Incentive Stock Options, the
terms and conditions of such grants, including the exercise price of the
purchase of Common Stock, shall be subject to and comply with the requirements
of Section 422 of the Code, as from time to time amended, and any implementing
regulations.
6.3 EXERCISE PRICE. The Exercise Price at which shares of Common
Stock may be purchased pursuant to the grant of an Option shall be fixed by the
Committee at the time of grant; however, the Option Price of an Incentive Stock
Option must be equal to or greater than the Fair Market Value of the shares of
Common Stock covered thereby. The Exercise Price of an Incentive Stock Option
granted to any Participant who is a 10% Shareholder must be at least equal to
110% of the fair market value of the shares of Common Stock on the date of
grant. Options granted under the Plan will not be Incentive Stock Options to the
extent that the Fair Market Value of the shares of Common Stock with respect to
which such Options first become exercisable in any year exceeds $100,000.
6.4 VESTING. Except as set forth in the next sentence, awards of
Options, Restricted Stock or SARs will vest and become non-forfeitable as
determined by the Committee and set forth in an Award
10-6
<PAGE> 7
Agreement. Subject to the provisions of Section 422 of the Code, Options and
SARs shall become exercisable in accordance with their terms in the event of
Death, Disability or Retirement of a Participant or upon a Change in Control or
Imminent Change in Control.
7. GRANTING AND EXERCISE OF OPTIONS.
7.1 LIMITATIONS ON EXERCISE OF OPTIONS. Notwithstanding any other
provision of this Plan to the contrary, the granting and exercise of Options
hereunder shall be subject to the following limitations (which shall be in
addition to the limitations, provisions and conditions contained elsewhere in
this Plan):
(a) The aggregate Fair Market Value (determined at the
time the option is granted) of the Option Stock for which Incentive
Stock Options are exercisable for the first time by any employee
during any calendar year (under all such Plans of the Company and its
subsidiaries) shall not exceed $100,000. Any option granted in excess
of this $100,000 threshold shall be specifically designated
Non-Qualified Options.
(b) Options may be granted as soon as practicable after
the date of the adoption of the Plan by the Board, and Award Agreements
evidencing such Grant(s) and the terms and conditions thereof may
similarly be so executed, but in each case, such Options and such
instruments shall be subject to the approval and ratification of the
Plan by the shareholders of the Company as provided in SECTION 1.3.
Notwithstanding anything in the Plan that may be deemed to be to the
contrary, no Option may be exercised unless and until such approval and
ratification is obtained. In the event such approval and ratification
shall not be obtained, the Plan and all Options that may have been
granted pursuant thereto shall be null and void.
7.2 DURATION OF OPTIONS. The term of Options granted under the Plan
shall be as fixed by the Committee at the time of grant and set forth in an
Award Agreement; provided, however, that the term of an Incentive Stock Option
shall not exceed 10 years from the date of grant. In the case of 10%
Shareholders, the term of an Incentive Stock Option shall not exceed five (5)
years from the date of grant. The terms of Options may, however, be shortened as
provided in SECTION 11 hereof. No Option may be exercised after expiration of
such Option's term.
7.3 EXERCISE OF OPTIONS. An Option granted under the Plan shall be
exercisable at such time or times, whether or not in installments, as the
Committee shall prescribe at the time the Option is granted and as set forth in
and subject to the provisions of any Award Agreement. An Option which has
become exercisable may be exercised in accordance with its terms as to any or
all full shares purchasable under the provisions of the Option, but not at any
time as to less than 100 shares unless the remaining shares which have become
so purchasable are less than 100 shares. The purchase price of the shares shall
be paid in full, as provided in SECTION 13 hereof, upon the exercise of the
Option, and the Company shall not be required to deliver certificates for such
shares until such payment has been made. Except as provided in SECTION 11, an
Incentive Stock Option may not be exercised at any time unless the holder
thereof is then an employee of the Company or any Subsidiary and shall have
been continuously employed by the Company or any Subsidiary since the date of
grant.
8. STOCK APPRECIATION RIGHTS (SARS).
8.1 GRANTING OF SARS. The Committee may, in its discretion, grant a
SAR to the holder of an Option either at the time the Option is granted or by
amending the instrument evidencing the grant of the Option at any time after
the Option is granted, so long as the grant is made during the period in which
grants of SARs may be made under the Plan and, if made to a person subject to
Section 16(b) of the Exchange Act, is made more than six months before the end
of the term of the Option.
10-7
<PAGE> 8
8.2 EXERCISE OF SARS. Each SAR shall be for such term and shall be
subject to such other terms and conditions as the Committee shall impose and as
may be set forth in an Award Agreement. The terms and conditions may include
Committee approval of the exercise of the SAR, limitations on the amount of
appreciation which may be recognized with regard to such SAR, and specification
of what portion, if any, of the amount payable to the Participant upon his
exercise of a SAR shall be paid in cash and what portion, if any, shall be
payable in Common Stock or additional Options. If and to the extent that shares
of Common Stock are issued in satisfaction of amounts payable on exercise of a
SAR, the shares of Common Stock so issued shall be valued at their Fair Market
Value on the date of exercise. Upon exercise of a SAR, the Option or portion
thereof with respect to which such right is exercised shall be surrendered and
shall not thereafter be exercisable. Upon exercise of any Option, any SAR or
portion thereof granted with respect to such Option shall expire and shall not
thereafter be exercisable.
9. RESTRICTED STOCK AWARDS.
9.1 RESTRICTED STOCK AWARDS. The Committee may grant Restricted Stock
Awards to such Eligible Persons, in such amounts and subject to such terms and
conditions, as the Committee may determine in its sole discretion, including
such restrictions on transferability and other restrictions as the Committee
may impose, which restrictions may lapse separately or in combination at such
times, under such circumstances, in such installments, or otherwise, as the
Committee shall determine.
9.2 ISSUANCE OF RESTRICTED STOCK. Restricted Stock awarded under the
Plan shall be evidenced by certificates registered in the name of the
Participant and bearing an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Restricted Stock. The Company
shall retain physical possession of any such certificates, and each Participant
awarded Restricted Stock shall have delivered a stock power to the Company,
endorsed in blank, relating to the Restricted Stock for so long as the
Restricted Stock is subject to a risk of forfeiture.
9.3 VOTING RIGHTS OF RESTRICTED STOCK. Unless otherwise determined by
the Committee at the time of an Award, the holder of Restricted Stock shall
have the right to vote the Restricted Stock and to receive dividends, if any,
thereon, unless and until such shares are forfeited.
9.4 REFUND OF CASH PAID FOR RESTRICTED STOCK. In the event all or any
of the shares of Restricted Stock awarded to a Participant are forfeited due to
failure to meet or comply with restrictions imposed by the Committee at the
time of the award prior to the lapse of such restrictions, the Company shall
repay to the Participant (or the Participant's estate) any cash amount paid by
the Participant for such forfeited shares.
10. TERMINATION OF EMPLOYMENT.
10.1 TERMINATION FOR CAUSE OR VOLUNTARY TERMINATION. In the event
of the Termination for Cause or the voluntary termination of employment of any
Participant to whom an Incentive Stock Option has been granted under the Plan,
such Incentive Stock Options held by him under the Plan, to the extent vested
and not theretofore exercised, shall be null and void. Incentive Stock Options
granted under the Plan shall not be affected by any change of employment so
long as the holder continues in the employ of the Company or any Subsidiary.
Nothing in the Plan or in any Award pursuant to the Plan shall confer on any
individual any right to continue in the employ of or continue any other legal
or contractual relationship with the Company or interfere in any way with the
right of the Company to terminate his or her employment or occupancy of any
corporate office or any other legal or contractual relationship at any time.
10.2 DEATH OF PARTICIPANT. In the event of the death of a
Participant, any Incentive Stock Options granted to such Participant may be
exercised by the person or persons to whom the Participant's rights under any
such Incentive Stock Options pass by will or by the laws of descent and
distribution (including the
10-8
<PAGE> 9
Participant's estate during the period of administration) at any time prior to
the earlier of (i) the respective expiration dates of any such Incentive Stock
Options or (ii) the date which is one (1) year after the date of death of such
Participant.
10.3 DISABILITY OF PARTICIPANT. In the event that any Participant's
employment with the Company shall terminate as a result of the Disability of
such Participant, such Participant may exercise any Inventive Stock Options
granted to him pursuant to the Plan at any time prior to the earlier of (i) the
respective expiration dates of any such Incentive Stock Options or (ii) the
date which is one (1) year after the date of such termination of employment.
10.4 TERMINATION WITHOUT CAUSE. In the event of termination without
cause of the employment of a person to whom an Incentive Stock Option has been
granted under the Plan, any Incentive Stock Options held by him under the Plan,
shall immediately vest and shall be exercisable for a period of three (3)
months following the date of termination.
10.5 NON-QUALIFIED OPTIONS, RESTRICTED STOCK AND SARS. The terms
and conditions of Non-Qualified Stock Options, Restricted Stock and SARs
relating to the effect of the termination of a Participant's employment, or
association with the Company, Disability of a Participant or his death shall be
such terms and conditions as the Committee shall, in its sole and absolute
discretion, determine at the time of termination, as specifically provided for
in the Award Agreement executed by the Participant at the time of an Award.
11. NON-TRANSFERABILITY OF RIGHTS
No Award and no right under any Award shall be assignable or
transferable otherwise than by will or the laws of descent and distribution
and, except to the extent otherwise provided in SECTION 13, the rights and
benefits of any such Award may be exercised and received, respectively, during
the lifetime of the Participant only by him or by his guardian or legal
representative.
12. RECAPITALIZATION, MERGER, CONSOLIDATION, CHANGE IN CONTROL AND SIMILAR
TRANSACTIONS.
12.1 ADJUSTMENT. Subject to any required action by the shareholders
and Board of the Company, within the sole and absolute discretion of the
Committee, the aggregate number of shares of Common Stock for which Awards may
be made hereunder, the number of shares of Common Stock covered by each
outstanding Option or SAR and the exercise price per share of Common Stock of
each such Option or SAR, shall all be equitably adjusted for any increase or
decrease in the number of issued and outstanding shares of Common Stock
resulting from a subdivision or consolidation of shares (whether by reason of
merger, consolidation, recapitalization, reclassification, split-up, combination
of shares, or otherwise) or the payment of a stock dividend (but only on the
Common Stock) or any other increase or decrease in the number of such shares of
Common Stock affected without the receipt of consideration by the Company (other
than shares held by dissenting shareholders).
12.2 CHANGE IN CONTROL. All outstanding Options, SARs and Restricted
Stock shall automatically vest and, in the case of Options and SARs, become
immediately exercisable in the event of a Change in Control or Imminent Change
in Control of the Company.
12.3 EXTRAORDINARY CORPORATE ACTION. Subject to any required action
by the shareholders of the Company, in the event of any Change in Control,
recapitalization, merger, consolidation, exchange of shares, spin-off,
reorganization, tender offer, liquidation or other extraordinary corporate
action or event, the Committee, in its sole and absolute discretion, shall have
the power, prior or subsequent to such action to:
10-9
<PAGE> 10
(i) appropriately adjust the number of shares of Common
Stock subject to each Option or SAR, the exercise price per share of
Common Stock and the consideration to be given or received by the
Company upon the exercise of any outstanding Options or SARs;
(ii) cancel any or all previously granted Options or SARs,
provided that appropriate consideration is paid to the Participants in
connection therewith; and/or
(iii) make such other adjustments in connection with the
Plan as the Committee in its sole and absolute discretion, deems
necessary, desirable, appropriate or advisable; PROVIDED, however,
that no action shall be taken by the Committee which would cause
Incentive Stock Options granted pursuant to this plan and to fail to
meet the requirements of Section 422 of the Code.
Moreover, in the event of any transaction, whether a merger, consolidation,
asset exchange, recapitalization or similar transaction, pursuant to which the
Company's Common Stock shall be reclassified as, converted into or otherwise
exchangeable for a different class of equity or debt security of the Company or
any other issuer, Options and SARs granted pursuant hereto shall likewise be,
without any action being required by a Participant or the Company, reclassified
as, converted into or otherwise exchangeable for rights or options to receive
such different security of the Company or any such successor or other issuer.
Except as expressly provided in SECTIONS 12.1, 12.2 and 12.3 hereof, no
Participant shall have any rights by reason of the occurrence of any of the
events described in this SECTION 12. In the event that the Company becomes a
wholly owned subsidiary of another corporation, the definitive agreement
regarding such transaction shall contain a provision which requires the new
parent company to adopt a plan substantially similar hereto and grant options
and/or stock appreciation rights substantially similar hereto to each
Participant herein as a condition precedent to the consummation of the
transaction.
12.4 ACCELERATED VESTING. The Committee shall at all times have the
power to accelerate the exercise date of Options and SARs and the vesting date
of Restricted Stock previously granted under the Plan.
13. PAYMENT OF PURCHASE PRICE, FEDERAL INCOME TAX OR OTHER
WITHHOLDING AMOUNT.
The Common Stock to be purchased upon exercise of any Option shall be
paid for in full, in cash or as hereinafter provided at the time of such
exercise. In addition, in its sole discretion the Committee may determine that
it is an appropriate method of payment for grantees to pay for any shares
subject to an option by delivering (i) certificates for shares of Common Stock
having a value equal to the Exercise Price of the Options being exercised, or
(ii) a properly executed exercise notice together with a copy of irrevocable
instructions to a broker to deliver promptly to the Company the amount of
proceeds for the sale of shares of Common Stock or margin credit extended on
shares of Common Stock (including the Common Stock to be acquired pursuant to
the exercise of Options) to pay the purchase price. To facilitate the foregoing,
the Company may enter into agreements for coordinated procedures with one ore
more brokerage firms. The value of Company Common Stock surrendered in payment
of the exercise price shall be its Fair Market Value, determined pursuant to
SECTION 2.1, on the date of exercise. Upon receipt of a notice of exercise of a
Stock Option and upon payment of the Option Price, the Company shall promptly
deliver to the Participant a certificate or certificates for the shares of
Common Stock purchased, without charge to him or her for issue or transfer tax.
The Committee in its sole discretion may from time to time permit the method of
exercising Options known as pyramiding (that is, the automatic application of
shares received upon the exercise of a portion of a Stock Option to satisfy the
exercise price for additional portions of the Option). With respect to
Non-Qualified Stock Options or any Incentive Stock Options which fail to qualify
as such for any reason, any required federal income tax or other withholding
amount shall be paid (in full) by the Participant to the Company in cash or by
certified check at the time of such exercise. The Company shall not be required
to
10-10
<PAGE> 11
deliver certificates for such shares until all such payments have been made, and
until the Company has had an opportunity (at its sole option) to obtain
verification from the Participant that all federal income tax or other
withholding amounts have been properly calculated and paid.
14. TERMINATION AND AMENDMENT.
14.1 TERMINATION DATE. Unless the Plan shall theretofore have been
terminated as hereinafter provided, it shall terminate on, and no Awards shall
be made hereunder after December 31, 2005. The Plan may be terminated earlier
by the shareholders of the Company or by the Board.
14.2 AMENDMENT. Modifications or other amendments to the Plan may be
made by the shareholders of the Company. The Plan may also be amended by the
Board; provided, however, that no amendment which shall constitute a
Modification shall be effective unless approved by the shareholders of the
Company within 12 months before or after the adoption of the Modification.
14.3 PARTICIPANT CONSENT. No termination, Modification, or amendment
of the Plan, may, without the consent of the Participant to whom any Award shall
theretofore have been made, adversely affect the rights of such Participant
under such Award; nor shall any such Modification or amendment be deemed to
effect a Modification, extension or renewal of any such Award previously made
except pursuant to an express written agreement to such effect, executed by the
Company and the Participant.
15. TIME OF AWARDS.
Nothing contained in the Plan shall constitute an Award hereunder. Any
Award pursuant to the Plan shall take place only upon approval by the Committee
of a resolution recommending an Award under this Plan. Notice of the
determination shall be given to each person to whom an Award is so made within a
reasonable time after the date of such Award. After the making of an Award under
this Plan, a written Award Agreement shall be duly executed by or on behalf of
the Company and the Participant.
16. FORM AND TERMS OF AWARD AGREEMENT.
Award Agreements evidencing Awards pursuant to the Plan shall be in
such form and shall contain such terms not inconsistent with the Plan as the
Committee may approve. Award Agreements may contain such terms, conditions,
restrictions and limitations in respect of Options, SARs and/or Restricted Stock
(and such provisions for the enforcement of compliance with the Securities Act
of 1933, as amended, and/or with state "Blue Sky" laws) as the Committee, in its
sole discretion, may determine. To the extent any term in any Award Agreement
shall be inconsistent with any term of this Plan, the term in this Plan shall
govern.
17. PARTIAL INVALIDITY.
The invalidity or unenforceability of any particular provision of this
Plan or any Award Agreement shall not effect the other provisions of this Plan
or such Award Agreement nor affect the validity or enforceability of the other
provisions of Award Agreements under this Plan, and this Plan and Awards
hereunder shall be construed in all respects as if such invalid or
unenforceable provision were omitted.
18. SPECIAL PROVISIONS WITH RESPECT TO INCENTIVE STOCK OPTIONS UNDER THIS
PLAN AND NON-QUALIFIED STOCK OPTIONS.
SECTION 5 describes the persons eligible to receive Awards under this
Plan. The Committee in making any Award of an Option shall indicate whether it
intends the Option to be an Incentive Stock Option under this Plan or a Non-
Qualified Stock Option and shall cause the Award Agreement with respect thereto
to
10-11
<PAGE> 12
indicate such intention. Should a person hold both one or more Incentive Stock
Options under this Plan and one or more Non-Qualified Stock Options, all of
such Options shall be exercisable in accordance with their respective terms and
limitations, and nothing in this Plan shall be construed as causing the
exercise of any such Option to preclude the exercise of any such other Option
in accordance with its terms.
19. NO OWNERSHIP OR SUBSCRIPTION RIGHTS.
Shares of Common Stock of the Company which are subject to an Option or
SAR but which have not yet been purchased or paid for shall have no subscription
rights and no Option or SAR holder shall be deemed to be a shareholder of the
Company for any purpose.
20. UNFUNDED PLAN.
The Plan is intended to constitute an "unfunded" plan. Unless otherwise
determined by the Board, the Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds.
21. RULE 16B-3 COMPLIANCE
21.1 HOLDING PERIOD. Unless a Participant could otherwise transfer
an equity security, derivative security, or shares issued upon exercise of a
derivative security granted under the Plan without incurring liability under
Section 16(b) of the Exchange Act, (i) an equity security issued under the Plan,
other than an equity security issued pursuant to the exercise of a derivative
security granted under the Plan, shall be held for at least six months from the
date of acquisition, and (ii) at least six months shall elapse from the date of
acquisition of a derivative security to the date of disposition of the
derivative security (other than upon exercise or conversion) or disposition of
any underlying equity security issued pursuant to the exercise or conversion of
such derivative security.
21.2 RULE 16B-3 SAVINGS PROVISION. It is the intent of the Company
that this Plan comply in all respects with applicable provisions of Rule 16b-3
and Rule 16a-1(c)(3) under the Exchange Act in connection with any grant of
Awards to or other transaction by a Participant who is subject to Section 16 of
the Exchange Act (except for transactions exempted under alternative Exchange
Act Rules or acknowledged in writing to be non-exempt by such Participant).
Accordingly, if any provision of this Plan or any Award Agreement does not
comply with the requirements of Rule 16b-3 or Rule 16a-1(c)(3) as then
applicable to any such transaction, such provision will be construed or deemed
amended to the extent necessary to conform to the applicable requirements of
Rule 16b-3 or Rule 16a-1(c)(3) so that such Participant shall avoid liability
under Section 16(b).
22. GOVERNING LAW.
The validity, construction, and effect of the Plan, any rules and
regulations relating to the Plan and any Award Agreement shall be determined in
accordance with the laws of the State of Tennessee and applicable federal law.
Plan Adopted by the Board of Directors on February 8, 1996 to be ratified by
the shareholders no later than December 31, 1996.
10-12
<PAGE> 1
Exhibit 10(b)
AMENDMENT NO. 1 TO
RESPONSE ONCOLOGY, INC.
1996 STOCK INCENTIVE PLAN
The following amendment to the Response Oncology, Inc. 1996 Stock
Incentive Plan (the "Plan") is adopted by the Compensation Committee of the
Board of Directors of the Company effective April 4, 1997, subject to approval
by the shareholders of the Company (as defined in the Plan) at its Annual
Meeting to be held on June 5, 1997. Capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Plan.
Section 3.1 of the Plan is amended by substituting the number 1,130,000
for the number 630,000 in the third line of that section.
In all other respects, the Plan shall remain in full force and effect as
originally adopted.
As Adopted by the Compensation Committee of the Board of Directors on April 4,
1997, to be approved by the shareholders no later than December 31, 1997.
10b-1
<PAGE> 1
EXHIBIT 24(b)
CONSENT OF KPMG PEAT MARWICK LLP
24(b)-1
<PAGE> 2
Accountants' Consent
We consent to incorporation by reference in the Registration Statements
on Form S-8 for Response Oncology, Inc. and subsidiaries of our report dated
February 12, 1997, relating to the consolidated balance sheets of Response
Oncology, Inc. and subsidiaries as of December 31, 1996 and 1995, and the
related consolidated statements of operations, stockholders' equity, and cash
flows for each of the years in the three-year period ended December 31, 1996,
and the related schedule, which report appears in the December 31, 1996 annual
report on Form 10-K of Response Oncology, Inc.
KPMG Peat Marwick LLP
Memphis, Tennessee
June 5, 1997
24(b)-2
