Registration No. 33-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
AIRSENSORS, INC.
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(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 91-1039211
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(State or Other Jurisdiction (IRS Employer Identification No.)
Incorporation or Organization)
16804 GRIDLEY PLACE
CERRITOS, CALIFORNIA 90703
-------------------------------- -------
(Address of Principal Executive Offices) (Zip Code)
1996 INCENTIVE STOCK OPTION PLAN
--------------------------------
(Full Title of the Plan)
THOMAS M. COSTALES
16804 GRIDLEY PLACE
CERRITOS, CALIFORNIA 90703-1792
----------------------------------------
(Name and Address of Agent For Service)
(310) 860-6666
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(Telephone Number, Including Area Code, of Agent For Service)
COPIES OF ALL COMMUNICATIONS TO:
WILLIAM G. PUSCH
DAVIS WRIGHT TREMAINE
2600 CENTURY SQUARE
1500 FOURTH AVENUE
SEATTLE, WASHINGTON 98101-1688
(206) 628-7744
CALCULATION OF REGISTRATION FEE
===========================================================================
PROPOSED PROPOSED
TITLE OF MAXIMUM MAXIMUM
SECURITIES AMOUNT OFFERING AGGREGATE AMOUNT OF
TO BE TO BE PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE(1) PRICE(1) FEE
- ---------------------------------------------------------------------------
Common Stock 250,000 $9.25 $2,312,500 $797.41
===========================================================================
(1) Estimated solely for the purpose of calculating the registration
fee on the basis of the closing price quoted on the Nasdaq National Market
on June 24, 1996.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents are incorporated by reference in this
registration statement:
(a) The registrant's latest annual report filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of
1934 ("Exchange Act");
(b) All other reports filed pursuant to Section 13(a) or
15(d) of the Exchange Act since the end of the fiscal year
covered by the documents referred to in (a) above;
(c) The description of the registrant's common stock
contained in its registration statement on Form 8-A filed
under the Exchange Act, including any amendment or report
filed for the purpose of updating such description; and
(d) All documents subsequently filed by the registrant
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act prior to the filing of a post-effective
amendment hereto which indicates that all securities offered
have been sold or deregisters all securities then remaining
unsold.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 145 of the Delaware General Corporation Law provides that
a corporation may indemnify directors and officers as well as other
employees and individuals against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement in connection with
specified actions, suits or proceedings, whether civil, criminal,
administrative or investigative (other than action by or in the right of
the corporation -- a "derivative action"), if they acted in good faith and
in a manner they reasonably believed to be in or not opposed to the best
<PAGE>
interests of the corporation and, with respect to any criminal action or
proceedings, had no reasonable cause to believe their conduct was unlawful.
A similar standard is applicable in the case of derivative actions, except
that indemnification only extends to expenses (including attorneys' fees)
actually and reasonably incurred in connection with the defense or
settlement of such action, and the statute requires court approval before
there can be any indemnification where the person seeking indemnification
has been found liable to the corporation. The statute provides that it is
not exclusive of other indemnification that may be granted by a
corporation's charter, bylaws, disinterested director vote, stockholder
vote, agreement or otherwise.
Article IX of the Registrant's By-laws requires indemnification to the
full extent permitted under Delaware law as from time to time in effect.
Subject to any restrictions imposed by Delaware law, the Registrant's By-
laws provide a right to indemnification for all expense, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or
penalties and amounts paid in settlement) actually and reasonably incurred
by any person in connection with any actual or threatened proceeding
(including, to the extent permitted by law, any derivative action) by
reason of the fact that such person is or was serving as a director or
officer of the Registrant or that, being or having been such a director or
officer or an employee of the Registrant, such person is or was serving at
the request of the Registrant as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
including an employee benefit plan. The Registrant's By-laws also provide
that the Registrant may, by action of its Board of Directors, provide
indemnification to its employees or agents with the same scope and effect
as the foregoing indemnification of directors and officers.
Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director
of the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability for (i) any breach of the director's duty of
loyalty to the corporation or its stockholders, (ii) acts or omissions not
in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) payments of unlawful dividends or unlawful
repurchases or redemptions, or (iv) any transaction from which the director
derived an improper personal benefit.
Article 11 of the Registrant's Certificate of Incorporation provides
that to the full extent that the Delaware General Corporation Law, as it
now exists or may hereafter be amended, permits the litigation or
elimination of the liability of directors, a director of the Registrant
shall not be liable to the Registrant or its stockholders for monetary
damages for breach of duty as a director. Any amendment or repeal of such
Article 11 will not adversely affect any right or protection of a director
of the Registrant for or with respect to any acts or omissions of such
director occurring prior to such amendment or repeal. The affirmative vote
of 80% of the voting stock of the Registrant is required to amend or
repeal, or to adopt any provision inconsistent with, such Article 11.
The Delaware General Corporation Law and the Registrant's Certificate
of Incorporation may have no effect on claims arising under the federal
securities laws.
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
5.1 Opinion of Davis Wright Tremaine
10.1 1996 Incentive Stock Option Plan
23.1 Consent of Ernst & Young LLP
23.2 Consent of Davis Wright Tremaine (included in
Exhibit 5.1)
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:
(i) To include any prospectus required by
Section 10(a)(3) to the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information
set forth in the registration statement;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in
the registration statement; PROVIDED, HOWEVER, that paragraphs
(a)(1)(i) and (a)(1)(ii) do not apply if the information required to
be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement;
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial BONA FIDE offering
thereof.
(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.
<PAGE>
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Act of 1934 (and
where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial BONA FIDE offering
thereof.
(c) The undersigned registrant hereby undertakes to deliver or
cause to be delivered with the prospectus, to each person to whom the
prospectus is sent or given, the latest annual report to security
holders that is incorporated by reference in the prospectus and
furnished pursuant to and meeting the requirements of Rule 14a-3 or
Rule 14c-3 under the Securities Exchange Act of 1934; and, where
interim financial information required to be presented by Article 3 or
Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or
given, the latest quarterly report that is specifically incorporated
by reference in the prospectus to provide such interim financial
information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to any provision or
arrangement existing whereby the registrant may indemnify a director,
officer or controlling person of the registrant against liabilities
under the Securities Act of 1933, 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
Securities Act of 1933 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 an
officer, director 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
of whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the
final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Cerritos, State of California, on
June 25, 1996.
AIRSENSORS, INC.
By /s/ Robert M. Stemmler
-----------------------------
Its President
<PAGE>
POWER OF ATTORNEY
By signing below, the following persons also constitute and appoint
Robert M. Stemmler or Thomas M. Costales as their true and lawful attorneys-
in-fact with full power and authority to sign pre-effective and post-
effective amendments to this registration statement and all other documents
relating to this registration statement in their stead as the following
persons could do in their capacities listed below if personally present;
the following persons hereby ratify and confirm all that each of Robert M.
Stemmler or Thomas M. Costales shall lawfully do by virtue of this
appointment.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- --------------------- ------------
/s/Robert M. Stemmler President, Chief June 25, 1996
- --------------------- Executive Officer and
Director (Principal
Executive Officer)
/s/Rawley F. Taplett Chairman of the Board June 25, 1996
- --------------------- of Directors
and Director
Vice Chairman of the
- --------------------- Board of Directors
Edwin J. Schneebeck and Director
/s/Peter B. Bensinger
- --------------------- Director June 26, 1996
- --------------------- Director
Norman L. Bryan
/s/V. Robert Colton Director June 26, 1996
- ---------------------
/s/Don Simplot Director June 25, 1996
- ---------------------
/s/Douglas W. Toms Director June 25, 1996
- ---------------------
/s/Thomas M. Costales Treasurer and Chief June 25, 1996
- --------------------- Financial Officer
(Principal Financial
Officer)
/s/Cary M. Wong Controller June 25, 1996
- ---------------------
Exhibit 5.1
June 25, 1996
AirSensors, Inc.
16804 Gridley Place
Cerritos, California 90703-1792
Re: 1996 Incentive Stock Option Plan
Registration on Form S-8
Ladies/Gentlemen:
In connection with the Registration Statement on Form S-8 to be filed
on or about June 26, 1996 by AirSensors, Inc. (the "Company") with the
Securities and Exchange Commission pursuant to the Securities Act of 1933,
as amended, you have requested us to provide our opinion as to the legality
of 250,000 shares of common stock, par value $.001 per share, of the
Company (the "Shares") being registered thereunder. We have reviewed the
Company's Certificate of Incorporation, as amended, Bylaws, as amended, and
such records of the Company's corporate proceedings as reflected in the
minute books, and other matters as we have deemed appropriate for this
opinion. In our examination, we have assumed the genuineness of
signatures, the authenticity of all documents submitted to us as originals,
and the conformity to the originals of all documents submitted to us as
copies thereof.
Based upon the foregoing, we are of the opinion that:
1. The Shares when issued pursuant to the provisions of the
Company's 1996 Incentive Stock Option Plan (the "Plan") will be validly
issued, fully paid and nonassessable.
2. The Plan is not subject to the requirements of the Employee
Retirement Income Security Act ("ERISA").
We hereby consent to the use of this opinion as an exhibit to the
above mentioned Registration Statement. In giving this consent, we do not
thereby admit that we come within the category of persons whose consent is
required by the Securities Act of 1933, as amended.
Very truly yours,
/s/DAVIS WRIGHT TREMAINE
AIRSENSORS, INC.
1996 INCENTIVE STOCK OPTION PLAN
PURPOSE OF THE PLAN. The purpose of this Incentive Stock Option Plan
is to attract and retain the best available personnel for positions of
substantial responsibility, to provide additional incentive to the
Employees of the Company and to promote the success of the Company's
business. It is intended that options issued pursuant to this Incentive
Stock Option Plan constitute "incentive stock options" within the meaning
of Section 422 of the Code.
1. DEFINITIONS. As used herein, the following definitions shall
apply:
"BOARD" means the Board of Directors of the Company.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMON STOCK" means the Company's common stock, par value $.001
per share.
"COMPANY" means AirSensors, Inc., a Delaware corporation.
"COMMITTEE" means the Committee appointed by the Board in
accordance with SECTION 3(A) of the Plan.
"EMPLOYEE" means any person employed by the Company or any
Subsidiary of the Company which now exists or is hereafter organized or is
acquired by the Company.
"IMPCO" means IMPCO Technologies, Inc., a Delaware corporation.
"OPTION" means a stock option granted pursuant to the Plan.
"OPTIONED STOCK" means the Common Stock subject to an Option.
"OPTIONEE" means a person who holds an Option.
"PLAN" means this 1996 Incentive Stock Option Plan.
"SUBSIDIARY" means a corporation of which more than 50% of the
voting shares are held directly by the Company or directly and indirectly
by the Company and one or more Subsidiaries, whether or not such
corporation now exists or is hereafter organized or acquired by the
Company or a Subsidiary.
2. STOCK SUBJECT TO THE PLAN. Subject to SECTION 10, the maximum
number of shares which may be optioned and sold under the Plan is 250,000
shares of Common Stock.
If an Option should expire or become unexercisable in whole or in
part for any reason, the remaining shares of Common Stock which were
subject to the Option shall, unless the Plan shall have been terminated,
become available for other Options under the Plan.
<PAGE>
3. ADMINISTRATION OF THE PLAN.
(a) PROCEDURE. The Plan shall be administered by the Board or,
as determined by the Board, a Committee appointed by the Board. The
Committee shall consist of not less than three members of the Board and
shall administer the Plan subject to such terms and conditions as the
Board may prescribe. From time to time the Board may increase the size of
the Committee and appoint additional members, remove members (with or
without cause) and appoint new members in substitution therefor, fill
vacancies however caused, or remove all members of the Committee and
thereafter directly administer the Plan. The Committee shall select one
of its members as chairman and shall hold meetings at such times and
places as it may determine.
Members of the Board who are either eligible for Options or have been
granted Options may vote on any matters affecting the administration of
the Plan or the grant of any Options pursuant to the Plan, except that no
such member shall act upon the granting of an Option to himself, but any
such member may be counted in determining the existence of a quorum at any
meeting of the Board or the Committee during which action is taken with
respect to the granting of Options to him.
As used in the Plan and in any Option, the term "Board" shall refer
to the Board, or the Committee if a Committee has been appointed.
(b) POWERS OF THE BOARD/COMMITTEE. Subject to the provisions
of the Plan, the Board shall have the authority, in its discretion:
(i) to determine, upon review of relevant information, the fair market
value of the Common Stock; (ii)to determine the exercise price per share
of Options to be granted, which price shall in no event be less than the
fair market value per share of Common Stock on the date of grant of the
Option, or 110% of such fair market value in the case of any Option
granted to an Employee who, immediately before the grant of such Option,
owns stock representing more than ten percent (10%) of the voting power of
all classes of stock of the Company or of its parent or Subsidiaries;
(iii) to determine the Employees to whom, and the time or times at which,
Options shall be granted and the number of shares to be represented by
each Option; (iv) to interpret the Plan; (v) to prescribe, amend and
rescind rules and regulations relating to the Plan; (vi) except as
otherwise provided in this Plan, to determine the terms and provisions of
each Option granted under the Plan (which need not be identical) and, with
the consent of the holder thereof, modify or amend each Option; (vii) to
accelerate the exercise date of any Option; (viii) to authorize any person
to execute on behalf of the Company any instrument required to effectuate
the grant of an Option granted by the Board; and (ix) to make all other
determinations deemed necessary or advisable for the administration of the
Plan.
All decisions, determinations and interpretations of the Board shall
be final and binding on all Optionees and any other holders of any Options
granted under the Plan. No member of the Board or the Committee shall be
liable for any action or determination made in good faith with respect to
the Plan or any Option. If the Board has appointed a Committee, the
actions of the Committee shall be reported to the Board.
(4) ELIGIBILITY. Options may be granted only to Employees. An
Employee who has been granted an Option may, if he or she is otherwise
eligible, be granted an additional Option or Options.
<PAGE>
No Option may be granted to an Optionee under the Plan if, as the
result of such grant, the aggregate fair market value (determined as of
the time each Option is granted) of the shares of Common Stock for which
such Optionee has been granted options which are exercisable for the first
time by such Optionee during any calendar year (under all incentive stock
option plans of the Company) would exceed $100,000.
The Plan shall not confer upon any Optionee any right with respect to
continuation of employment by the Company, nor shall it interfere in any
way with his or her right or the Company's right to terminate his or her
employment at any time.
(5) TERM OF PLAN. Subject to SECTION 16, the Plan shall become
effective upon its adoption by the Board. It shall continue in effect for
a term of ten (10) years from the effective date unless sooner terminated
under SECTION 12.
(6) TERM OF OPTION. Except as otherwise provided in SECTIONS 8 and
10, the term of each Option shall be for not more than ten (10) years from
the date of grant thereof, except that the term of each Option granted to
an employee who, immediately before such Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all
classes of stock of the Company or of its parent or Subsidiaries shall be
for not more than five (5) years from the date of grant thereof. Subject
to the foregoing, the term of each Option shall be determined by the
Board.
(7) OPTION PRICE AND CONSIDERATION.
(a) The price for the shares of Common Stock to be issued
pursuant to an Option shall be such price as is determined by the Board,
but shall in no event be less than the fair market value per share of the
Common Stock on the date of grant of the Option. In the case of an Option
granted to an Employee who, immediately before the grant of such Option,
owns stock representing more than ten percent (10%) of the voting power of
all classes of stock of the Company or of its parent or Subsidiaries, the
price shall be not less than 110% of the fair market value per share of
such Common Stock. The fair market value shall be determined by the Board
in its discretion; PROVIDED, that if there is a public market for the
Common Stock, the fair market value shall be (i) the closing sale price as
of the date of grant on the Nasdaq National Market or a stock exchange if
the Common Stock is traded on the Nasdaq National Market or a stock
exchange, and (ii) the mean of the reported closing bid and ask prices for
the Common Stock as of the date of grant if the Common Stock is not traded
as provided in clause (i).
(b) The consideration to be paid for the Common Stock to be
issued upon exercise of an Option, and the method of payment, shall be
determined by the Board and may consist of cash or any other consideration
and method of payment for the issuance of common stock which is permitted
under the Delaware Corporation Law and complies with other applicable laws
and regulations (including but not limited to, applicable federal tax and
federal and state securities laws and regulations).
<PAGE>
(8) VESTING AND EXERCISE OF OPTIONS.
(a) VESTING AND EXERCISE OF OPTIONS WHILE AN EMPLOYEE. Each
Option held by an Optionee shall vest and shall be exercisable at any time
so long as such Optionee continues to be an Employee, cumulatively, (i) as
to forty percent (40%) of the total number of shares subject to such
Option, twenty-four (24) months following the date of grant of such
Option, and (ii) as to twenty percent (20%) of the total number of shares
subject to such Option, once during each twelve (12) month period
commencing on the third and each subsequent anniversary date of the grant
of such Option, so that sixty (60) months following the date of the grant
of each Option one hundred percent (100%) of the shares subject to such
Option may be purchased by exercise of the Option.
(b) VESTING OF OPTIONS UPON RETIREMENT. All Options held by an
Optionee who retires at age 62 or older and was continuously an Employee
for five (5) years immediately preceding retirement which are not vested
as provided in SECTION 8(a) shall immediately vest upon such Optionee's
retirement and be exercisable as provided in SECTION 8(c).
(c) EXERCISE OF OPTIONS FOLLOWING TERMINATION OF STATUS AS AN
EMPLOYEE. Following termination of employment as an Employee, an Optionee
may exercise an Option to the extent that he or she was entitled to
exercise the Option at the date of such termination as provided in
SECTION 8(a) and (b) as follows:
(i) Except in the case of death or disability (within the
meaning of Section 22(e)(3) of the Code), within thirty (30) days
following the date of termination of employment, except that the Board may
extend the period for such exercise up to a period not exceeding three (3)
months following the date of termination;
(ii) If an Optionee dies while an Employee, the period of
time within which the Board may permit exercise of Options after the date
of death may be up to one (1) year, and such Options may be exercised by
the Optionee's estate or by a person who acquired the right to exercise
the Option by bequest or inheritance or by reason of the death of an
Optionee; and
(iii) If an Optionee becomes disabled while an Employee,
the period of time within which the Board may permit exercise of Options
after the date of termination as an Employee of the Company may be up to
one (1) year.
Options which are not vested as provided in SECTIONS 8(a) and (b) or
which are vested but not exercised as required by SECTION 8(c) shall
terminate.
(d) SPECIAL LIMITATION ON EXERCISE. Notwithstanding
SECTIONS 8(a) and (b), in no event shall an Option be exercisable
(i) during the six (6) month period immediately following the date of
grant except as otherwise provided in SECTION 10, or (ii) for the first
time during any calendar year for the purchase of Common Stock with an
aggregate fair market value (determined as of the date of grant) in excess
of $100,000.
<PAGE>
(e) PROCEDURE FOR EXERCISE; RIGHTS AS STOCKHOLDER. An Option
shall be deemed to be exercised when written notice of such exercise has
been given to the Company in accordance with the terms of the Option by
the person entitled to exercise the Option and full payment for the shares
of Common Stock with respect to which the Option is exercised has been
received by the Company. An Option may not be exercised for a fraction of
a share of Common Stock.
Until the issuance (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the
Company) of the stock certificate evidencing such shares of Common Stock,
no right to vote or receive dividends or any other rights as a stockholder
shall exist with respect to such Common Stock, notwithstanding the
exercise of the Option. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock
certificate is issued, except as provided in SECTION 10.
Exercise of an Option shall result in a decrease in the number of
shares of Common Stock which thereafter may be available, both for
purposes of the Plan and for purchase under the Option, by the number of
shares of Common Stock as to which the Option is exercised.
9. NON-TRANSFERABILITY OF OPTIONS. An Option may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee.
10. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER. Subject
to any required action by the stockholders of the Company, the number of
shares of Common Stock covered by each outstanding Option, and the number
of shares of Common Stock which have been authorized for issuance under
the Plan but as to which no Options have yet been granted or which have
been returned to the Plan upon cancellation of an Option, as well as the
price per share of Common Stock covered by each such outstanding Option,
shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split 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 receipt of consideration by the Company; PROVIDED, that
conversion of any convertible securities of the Company shall not be
deemed to have been "affected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination shall be final,
binding and conclusive. Except as expressly provided herein, no issue by
the Company of shares of stock of any class, or securities convertible
into shares of stock of any class, shall affect, and no adjustment by
reason thereof shall be made with respect to, the number or price of
shares of Common Stock subject to an Option.
In the event of (i) the dissolution or liquidation of the Company,
(ii) the sale of substantially all of the assets of the Company or of
IMPCO, or (iii) the merger, consolidation or other reorganization of the
Company with or into another corporation, the Options will terminate
unless otherwise provided by the Board. The Board may, in the exercise of
its sole discretion in such instances, declare that any Option shall
terminate as of a date fixed by the Board or may give all or certain
Optionees the right to exercise their Options as to all or any part of the
shares of Common Stock which are subject to such Options, including shares
of Common Stock as to which Options would not otherwise be exercisable.
<PAGE>
In the event of a "change of control" of the Company, the Board may,
in the exercise of its sole discretion, give all or certain Optionees the
right to exercise their Options as to all or any part of the shares of
Common Stock which are subject to such Options, including shares of Common
Stock as to which Options would not otherwise be exercisable. For
purposes of this paragraph, "change of control" shall mean (i) within the
meaning of Section 13(d) of the Securities Exchange Act of 1934, any
person or group becomes a beneficial owner, directly or indirectly, of the
Company's securities representing 50% or more of the total voting power of
the Company's then outstanding securities, (ii) the stockholders of the
Company approve the dissolution or liquidation of the Company, (iii) the
stockholders of the Company approve an agreement to merge or consolidate,
or otherwise reorganize, whether into one or more entities, as a result of
which less than 50% of the total voting power of securities of the
surviving or resulting entity are, or are to be, owned by former
stockholders of the Company, or (iv) the stockholders or directors of the
Company or IMPCO approve, respectively, the sale of seventy-five percent
(75%) or more of the Company's or IMPCO's business and/or assets.
No Option granted pursuant to this Plan shall be adjusted by the
Board pursuant to this SECTION 10 in a manner that causes the Option to
fail to continue to qualify as an incentive stock option within the
meaning of Section 422 of the Code.
The grant of an Option pursuant to the Plan shall not affect in any
way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge or to consolidate or to dissolve, liquidate or sell,
or transfer all or any part of its business or assets.
11. TIME OF GRANTING OPTIONS. The date of grant of an Option shall,
for all purposes, be the date on which the Board makes the determination
granting such Option. Notice of the determination shall be given to each
Employee to whom an Option is so granted within a reasonable time after
the date of such grant.
12. AMENDMENT AND TERMINATION OF THE PLAN.
(a) AMENDMENT AND TERMINATION. The Board may amend or
terminate the Plan from time to time in such respects as the Board may
deem advisable, except that, without approval of the holders of a majority
of the outstanding shares of the Common Stock, no such revision or
amendment shall:
(i) Increase the number of shares of Common Stock subject
to the Plan other than in connection with an adjustment under SECTION 10
of the Plan;
(ii) materially change the designation of the class of
employees eligible to be granted Options;
(iii) remove the administration of the Plan from the Board; or
(iv) materially increase the benefits accruing to participants
under the Plan.
(b) EFFECT OF AMENDMENT OR TERMINATION. Any such amendment or
termination of the Plan shall not affect Options granted prior to such
amendment or termination and such Options shall remain in full force and
effect as if this Plan had not been amended or terminated.
<PAGE>
13. CONDITIONS UPON ISSUANCE OF SHARES. Shares of Common Stock shall
not be issued with respect to an Option granted under the Plan unless the
exercise of such Option and the issuance and delivery of such Shares
pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange or
market upon which the Common Stock may then be listed or quoted, and shall
be further subject to the approval of counsel for the Company with respect
to such compliance.
As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of
any such exercise that the shares of Common Stock are being purchased only
for investment and without any present intention to sell or distribute such
Common Stock if, in the opinion of counsel for the Company, such a
representation is required by any of the aforementioned relevant provisions
of law.
14. RESERVATION OF SHARES. The Company, during the term of this
Plan, will at all times reserve and keep available such number of shares of
Common Stock as shall be sufficient to satisfy the requirements of the
Plan.
Inability of the Company to obtain from any regulatory body having
jurisdiction authority deemed by the Company's counsel to be necessary to
the lawful issuance and sale of any shares of Common Stock hereunder shall
relieve the Company of any liability in respect of the non-issuance or sale
of such shares as to which such requisite authority shall not have been
obtained.
15. OPTION AGREEMENTS. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
16. STOCKHOLDER APPROVAL. Effectiveness of the Plan shall be subject
to approval within twelve (12) months following the Board of Directors'
adoption of this Plan by the holders of the Company's outstanding Common
Stock.
Adopted by the Board of Directors on January 11, 1996.
Approved by the stockholders on .
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) and related Prospectus pertaining to the 1996 Incentive Stock
Option Plan of AirSensors, Inc. of our report dated June 28, 1995, with
respect to the consolidated financial statements and schedules of
AirSensors, Inc. included in its Annual Report (Form 10-K) for the year
ended April 30, 1995, filed with the Securities and Exchange Commission.
/s/Ernst & Young LLP
Los Angeles, California
June 25, 1996
