SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party Other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/X/ Definitive Additional Material
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
HEMACARE CORPORATION
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14a.
/ / $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transactions applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/X/ Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the
date of its filing.
1) Amount Previously Paid: $125.00
2) Form, Schedule or Registration Statement No.: Schedule 14A
Proxy Statement
3) Filing Party: Registrant
4) Date Filed: April 19, 1996
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HEMACARE CORPORATION
____________________________________
NOTICE OF ADJOURNED ANNUAL MEETING OF SHAREHOLDERS
To Be Reconvened July 19, 1996
9:30 a.m.
_________________
The 1996 Annual Meeting of Shareholders of HemaCare Corporation (the "Company"),
which was adjourned on June 5, 1996, following the establishment of a quorum,
will be reconvened at the Sportsmen's Lodge Hotel, 12825 Ventura Boulevard,
Studio City, California 91604, on Friday, July 19, 1996 at 9:30 a.m. (Pacific
Daylight Time), for the following purposes:
1. To elect four directors for the ensuing year;
2. To consider and vote upon a proposal to approve the Company's 1996
Stock Incentive Plan, as revised following the recent adoption of
amendments to Rule 16b-3 by the Securities and Exchange Commission;
3. To transact such other business as may properly come before
the Meeting or any adjournment or postponement thereof.
Only holders of Common Stock of the Company of record at the close of business
on April 17, 1995 will be entitled to notice of and to vote at the adjourned
Meeting.
In order that your shares may be represented at the adjourned Meeting and to
assure a quorum, please complete, date and sign the enclosed Proxy and return it
promptly in the self-addressed, stamped envelope enclosed for that purpose,
whether or not you expect to attend the adjourned Meeting in person. DUE TO
CHANGES IN THE SLATE OF NOMINEES FOR DIRECTOR AND REVISIONS MADE TO THE
COMPANY'S 1996 STOCK INCENTIVE PLAN, PROXIES RETURNED IN RESPONSE TO THE
ORIGINAL PROXY STATEMENT OF THE BOARD OF DIRECTORS WILL BE DISREGARDED AT THE
ADJOURNED ANNUAL MEETING. IN ORDER FOR YOUR SHARES TO BE REPRESENTED AND VOTED
AT THE ADJOURNED MEETING, IT WILL BE NECESSARY FOR YOU TO ATTEND THE MEETING IN
PERSON OR TO RETURN THE ENCLOSED PROXY.
/s/ JoAnn R. Stover
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JoAnn R. Stover
Secretary
Sherman Oaks, California
June 14, 1996
WHETHER OR NOT YOU PLAN TO ATTEND THE ADJOURNED MEETING, PLEASE MARK, DATE,
SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE.
<PAGE> 1
HEMACARE CORPORATION
4954 Van Nuys Boulevard
Sherman Oaks, California 91403
June 14, 1996
__________________________
SUPPLEMENT TO PROXY STATEMENT DATED APRIL 22, 1996
This Supplement to Proxy Statement supplements and amends the Proxy Statement
(the "Proxy Statement") dated as of April 22, 1996, of the Board of Directors of
HemaCare Corporation (the "Company"), and should be read in conjunction with
the Proxy Statement and the Annual Report of the Company that accompanied the
Proxy Statement.
The 1996 Annual Meeting of Shareholders of the Company was convened on June 5,
1996, as previously called, and was immediately adjourned following the
establishment of a quorum. The Board of Directors has set July 19, 1996 as
the date for reconvening the Annual Meeting, at the time and place indicated
in the Notice accompanying this Supplement to Proxy Statement. This
Supplement to Proxy Statement sets forth certain changes in the slate of
nominees to serve as directors of the Company for the ensuing year and
certain changes in the Company's 1996 Stock Incentive Plan following the
recent adoption by the Securities and Exchange Commission of amendments to
Rule 16b-3 under the Securities Exchange Act of 1934, as amended. DUE TO
THESE CHANGES, PROXIES RETURNED IN RESPONSE TO THE ORIGINAL PROXY STATEMENT
WILL BE DISREGARDED AT THE ADJOURNED ANNUAL MEETING. IN ORDER FOR SHARES TO
BE REPRESENTED AND VOTED AT THE ADJOURNED MEETING, IT WILL BE NECESSARY FOR A
SHAREHOLDER TO ATTEND THE MEETING IN PERSON OR TO RETURN THE PROXY
ACCOMPANYING THIS SUPPLEMENT TO PROXY STATEMENT.
The accompanying Proxy is solicited by and on behalf of the Board of Directors
of the Company, for use only at the adjourned Annual Meeting of Shareholders to
be reconvened on July 19, 1996 and at any and all adjournments or postponements
thereof (the "Meeting"). Unless the accompanying Proxy has been previously
revoked, the shares represented by the Proxy will, unless otherwise directed, be
voted at the Meeting for the nominees for election as directors named below,
the adoption of the Company's 1996 Stock Incentive Plan, as revised, and, with
discretion, on all such other matters as may properly come before the Meeting.
A shareholder of record may revoke the Proxy at will at any time prior to the
voting of shares by voting in person at the Meeting or by filing with the
Secretary of the Company a duly executed Proxy bearing a later date or an
instrument revoking the Proxy. Shareholders whose shares are held in street
name should consult with their brokers or other nominees concerning
procedures of revocation.
It is anticipated that this Supplemental Proxy Statement and accompanying
Proxy will first be mailed to shareholders on or about June 18, 1996.
THE SECTIONS BELOW IN THIS SUPPLEMENT TO PROXY STATEMENT UNDER THE CAPTIONS
"VOTING RIGHTS," "ELECTION OF DIRECTORS" AND "APPROVAL OF 1996 STOCK INCENTIVE
PLAN" AMEND AND REPLACE IN THEIR ENTIRETY THE SECTIONS UNDER THE SAME CAPTIONS
IN THE PROXY STATEMENT.
VOTING RIGHTS
Holders of the Company's common stock, without par value (the "Common Stock"),
of record as of the close of business on April 17, 1996, will be entitled to
vote on all matters presented to the Meeting. On April 17, 1996, there were
outstanding 5,941,765 shares of Common Stock, which constituted all of the
outstanding voting securities of the Company. Each holder of Common Stock is
entitled to one vote for each share held, except that in the election of
directors, each shareholder has cumulative voting rights and is entitled to as
many votes as equal the number of shares held multiplied by the number of
directors to be elected (four). All such votes may be cast for a single
candidate or distributed among any or all the candidates as the shareholder
sees fit. However, no shareholder shall be entitled to cumulate votes unless
the candidate's name has been placed in nomination prior to the voting and the
shareholder, or any other shareholder, has given notice at the Meeting prior
to the voting of their intention to cumulate their votes. The Company is
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soliciting authority to cumulate votes in the election of directors, and the
enclosed Proxy grants discretionary authority for such purpose. The election
of directors requires the affirmative vote for each candidate of a plurality
of the votes cast. The approval of the adoption of the Company's 1996 Stock
Incentive Plan requires the affirmative vote of a majority of the shares of
Common Stock represented and voting at the Meeting on the Plan. Typically,
any other matters that may be presented at the Meeting will require the
affirmative vote of a majority of the shares represented and voting at the
Meeting.
Abstentions, and any shares as to which a broker or nominee has indicated
that it does not have discretionary authority to vote ("broker non-votes"),
on a particular matter generally will be treated as shares that are present
and are entitled to vote for purposes of determining the presence of a quorum
(so long as any broker non-vote shares are voted on at least one matter at
the Meeting) but as unvoted for purposes of determining whether approval of
the shareholders has been obtained with respect to any such matter. Under
California law and the Company's Bylaws, a quorum consists of the presence in
person or by proxy of the holders of a majority of the shares entitled to
vote at the Meeting, and a matter(other than the election of directors) voted
on by shareholders will be approved if it receives the vote of a majority of
the shares both present and voting, which shares also constitute a majority
of the required quorum, unless the vote of a greater number of shares is
required. Accordingly, abstentions and broker non-votes will have no effect
on such a vote; provided, however, that in the event the number of shares
voted affirmatively does not represent a majority of the required quorum,
abstentions and broker non-votes will have the effect of a "no" vote. Under
California law and the Company's Bylaws, abstentions from voting, broker non-
votes and votes otherwise withheld in the election of directors, which is by
plurality, have no effect.
ELECTION OF DIRECTORS
Information Concerning the Nominees
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The Company's Bylaws provide for seven directors. Currently, there are five
directors following the resignation on May 31, 1996 of Willis L. Warner. Four
of the current directors have been previously elected by the shareholders and
one was newly appointed by the Board to fill a vacancy in 1995. Three
vacancies remain on the Board of Directors if the proposed nominees are
elected. The Company has not identified persons to fill the vacancies on the
Board of Directors, and Proxies may be voted for not more than four nominees
for director.
California law and the Company's Bylaws provide that a quorum of the Board of
Directors consists of a majority of the authorized number of directors. If
the Board is comprised of only four members, as contemplated, all directors
will need to be present at any meeting of the Board to satisfy the quorum
requirements. The Board of Directors is conducting a search with a view to
filling one or more of the vacancies on the board following the Meeting.
In addition to the nominees named below, the original Proxy Statement
identified as nominees Dr. Warner and Dr. Joshua Levy. Following the
mailing of the Proxy Statement, a majority of the Board of Directors suggested
that each of Drs. Warner and Levy should withdraw his name as a nominee for
director, which each agreed to do. At that time, Dr. Warner also resigned as
a director. Dr. Levy will remain as an officer of the Company and is assuming
additional duties as chairman of the Company's newly formed Medical Advisory
Board. In this capacity, Dr. Levy will serve as an ex officio director of the
Company but will not have any of the voting or approval rights that may be
exercised by a director.
Each director will hold office until the next Annual Meeting of Shareholders
and until the election of his successor. All Proxies received by the Board
of Directors will be voted for the election, as directors, of the nominees
listed below if no direction to the contrary is given. In the event that any
nominee is unable or declines to serve, an event that is not anticipated, the
Proxies will be voted for the election of any nominee who may be designated
by the Board of Directors.
The information set forth below is submitted with respect to the nominees for
whom it is intended that Proxies will be voted.
Thomas M. Asher, Ph.D. (69), has served as Chairman of the Board of Directors
since August 1986 and has been member of the Board of Directors since co-
founding the Company in 1978. Mr. Asher served as President of the Company from
1978 to August 1986 and as Secretary from 1978 to May 1995. Since receiving his
Ph.D. degree in Microbiology from the University of London in 1950, he has spent
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approximately 46 years in the biomedical field, including academic research,
service as a U.S. Public Health Service Officer, business and technical
experience within the biomedical industry and operating experience as co-founder
and president of Immuno-Science Corporation, a then publicly held company which
was sold to Johnson & Johnson in 1977.
Hal I. Lieberman (46), has been President, Chief Executive Officer and member of
the Board of Directors since September 1988. He received his Masters degree in
Health Care Administration from The George Washington University in 1974. Mr.
Lieberman has more than 25 years of experience in the health care industry,
including administrative positions in hospitals. From 1981 to September 1988,
he was Vice President of MEDIQ Mobile Services, Inc., a national shared medical
service company. Mr. Lieberman has been a member of the American College of
Healthcare Executives since 1980.
Glenn W. Bartlett, Ph.D. (63), has been a member of the Board of Directors since
February 1991. Since April 1995, Dr. Bartlett has been employed as an
independent consultant, specializing in business development in the field of
healthcare. From 1983 to his retirement in 1995, Dr. Bartlett served as Manager
of Business Development for Beckman Instruments, an international manufacturer
of laboratory equipment and diagnostic reagents. From 1979 to 1983, Dr.
Bartlett was Vice President, Research of SmithKline Diagnostics Division of
SmithKline Corporation, and from 1966 to 1979, he was employed at American
Hospital Supply Company, a major hospital supply company, where he served as
Director of Scientific Planning and later as Vice President, Research and
Technology, Science Business. Dr. Bartlett received his Ph.D. in Physical
Chemistry at Oxford University. While at Oxford, he held an ICE Research
Fellowship. He then taught microbiology for eight years at Memorial
University of Newfoundland and at McGill University Faculty of Medicine,
Montreal. Dr. Bartlett is a member of the Company's Audit Committee and is
Chairman of the Compensation Committee.
Jon B. Victor (43), has been a member of the Board of Directors since June
1995. In March 1996, Mr. Victor co-founded Greenwich Ventures, LLC, an
institutional investment manager, and serves as president. In 1983, Mr.
Victor founded Security Capital Management, Inc., an institutional investment
manager, and served as president until March 1996, at which time the company
was sold. In 1992, Mr. Victor co-founded and is a principal shareholder of
Gordon Management, Inc., the general partner of Edgewater Private Equity Fund,
L.P., a significant shareholder of the Company. Mr. Victor has more than 17
years of investment management experience. Mr. Victor is a graduate of
Washington University, St. Louis, Missouri and earned a law degree and
completed MBA course work at The George Washington University in Washington,
D.C. Mr. Victor serves on the Board of Directors of several private investment
firms and on the Board of Advanced Photonics, Inc., a publicly held company
engaged in the manufacture of light detection devices. Mr. Victor is Chairman
of the Company's Audit Committee and a member of the Compensation Committee.
The Board of Directors recommends a vote FOR each director nominated.
Directors and Executive Officers
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The Board of Directors consists of the nominees described above. Such nominees
also include all of the executive officers of the Company other than the
Company's Chief Financial Officer, Sharon C. Kaiser and the Company's Medical
Director and co-founder, Dr. Joshua Levy.
Sharon C. Kaiser (51), was appointed Vice President of Finance and Chief
Financial Officer in May 1995. From 1991 until joining the Company, Ms. Kaiser
acted as an independent financial consultant to various businesses. Prior to
that time, Ms. Kaiser held senior financial positions at Weyerhaeuser Mortgage
Company and the Koll Company. Ms. Kaiser was with Arthur Andersen & Co. from
1979 to 1987, serving as a senior manager of that firm for the last four years.
Ms. Kaiser is a graduate of the University of Southern California and has been
a Certified Public Accountant since 1981.
Joshua Levy, M.D. (56), has been Senior Vice President since October 1988,
Medical Director and a member of the Board of Directors since co-founding the
Company in 1978. He recently was appointed by the Board to be chairman of the
Company's newly formed Medical Advisory Board (MAB), in which capacity he will
serve as an ex officio director of the Company but will not have any of the
voting or approval rights that may be exercised by a director. The MAB has been
assigned the task of monitoring the national medical community for advances and
trends in health care for the purpose of evaluating new and existing
technologies for possible introduction by the Company in blood-related
applications. Dr. Levy received his M.D. degree from Albert Einstein College
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of Medicine in 1964. He is certified by the American Board of Internal Medicine
and was Adjunct Associate Professor of Medicine at UCLA from 1967 to 1982. He
has published numerous scientific articles in the fields of rheumatology and
immunology and is a national authority and frequent lecturer on therapeutic
hemapheresis. Dr. Levy maintains a private medical practice and works
approximately 100 hours per month for the Company.
All officers serve at the pleasure of the Board of Directors.
APPROVAL OF 1996 STOCK INCENTIVE PLAN
The Board of Directors has unanimously approved, subject to shareholder approval
at the Meeting, the HemaCare 1996 Stock Incentive Plan (the "Plan"). The
purposes of the Plan are to (i) enable the Company and Related Companies (as
defined below) to attract, motivate and retain top-quality directors, officers,
employees, consultants, advisers and independent contractors, (ii) provide
substantial incentives for such persons to act in the best interests of the
shareholders of the Company and (iii) reward extraordinary effort by such
persons on behalf of the Company or a Related Company. The Plan provides for
awards in the form of stock options, which may be either "incentive stock
options" within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), or non-qualified stock options, or restricted stock.
The Company's 1986 Stock Option Plan (the "1986 Plan") expires on July 9, 1996.
As of April 17, 1996, there were options outstanding under the 1986 Plan
exercisable for 362,800 shares of Common Stock with exercise prices ranging from
$1.125 to $6.125 and with expiration dates ranging from August 28, 1996 to
November 16, 2000. As of April 17, 1996, 289,751 shares of Common Stock had
been issued upon the exercise of stock options granted under the 1986 Plan.
The Board of Directors believes that the 1986 Plan has aided the Company in
attracting, motivating and retaining quality employees and management personnel.
With the expiration of the 1986 Plan, the Board of Directors believes it is
important to establish a new stock incentive plan.
The Board of Directors recommends a vote FOR the approval of the Plan.
Principal Provisions of the Plan
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The following summary of the Plan is qualified in its entirety by reference to
the full text of the Plan, which is attached as Appendix A to this Proxy
Statement.
SHARES. The total number of shares of Common Stock available for
distribution under the Plan is 750,000; provided, however, that no award may be
made at any time if, after giving effect to such award, the total number of
shares of Common Stock issuable upon exercise of all outstanding options and
warrants of the Company (whether or not under the Plan) plus the total number of
shares of Common Stock called for under any stock bonus or similar plan of the
Company (including shares of Common Stock underlying awards under the Plan)
would exceed 30% of the total number of shares of Common Stock outstanding at
the time of such award. For purposes of the foregoing: (i) those shares
issuable upon exercise of rights, options or warrants, or under a stock
purchase plan, meeting certain requirements specified in the Rules of the
California Commissioner of Corporations are not counted against the 30%
limitation; (ii) any outstanding preferred or senior common shares of the
Company convertible into Common Stock are to be deemed converted in
determining the total number of outstanding shares of Common Stock at any time;
and (iii) any shares of Stock subject to promotional waivers under the Rules
of the California Commissioner of Corporations are not be deemed to be
outstanding. As of April 17, 1996, the total number of shares of Common Stock
with respect to which awards under the Plan could be made was 613,486.
Shares awarded under the Plan may be authorized and unissued shares or
treasury shares. If shares subject to an option under the Plan cease to be
subject to such option, or shares under the Plan are forfeited, such shares will
again be available for future distribution under the Plan, unless the forfeiting
participant received any benefits of ownership such as dividends from the
forfeited award.
ADMINISTRATION. The Plan will be administered by the Compensation
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Committee of the Board of Directors of the Company (the "Board") or such other
committee of directors as the Board shall designate, which committee shall
consist solely of not less than two "non-employee directors" (as such term is
defined in Rule 16b-3 under the Securities Exchange Act of 1934 (the "Exchange
Act") or any successor rule ("Rule 16b-3")) who shall serve at the pleasure of
the Board, each of whom shall also be an "outside director" within the meaning
of Section 162(m) of the Internal Revenue Code and Section 1.162-27 of the
Treasury Regulations or any successor provision(s) thereto ("Section 162(m)");
provided, however, that if there are not two persons on the Board who meet the
foregoing qualifications, any such committee may be comprised of two or more
directors of the Company, none of which is an officer (other than a non-employee
Chairman of the Board of the Company) or employee of the Company or a Related
Company. If no such committee has been appointed by the Board, the Plan will be
administered by the Board. Such committee as shall be designated to administer
the Plan or the Board is hereinafter referred to as the "Committee."
Notwithstanding any provision of the Plan to the contrary, if such a committee
has been designated to administer the Plan, all actions with respect to the
administration of the Plan in respect of the members of such committee shall be
taken by the Board.
Initially, the Plan will be administered by the Compensation Committee,
which is currently comprised of the Company's two independent directors, each of
whom is believed to be a non-employee director as defined for purposes of Rule
16b-3 and an outside director as defined for purposes of Section 162(m).
The Committee is authorized to, among other things, set the terms of awards
to participants and waive compliance with the terms of such awards. The
provisions attendant to the grant of an award under the Plan may vary from
participant to participant. The Committee has the authority to interpret the
Plan and adopt administrative regulations. The Committee may from time to time
delegate to one or more officers of the Company any or all of its authorities
under the Plan, except with respect to awards granted to persons subject to
Section 16 of the Exchange Act. The Committee must specify the maximum number
of shares that the officer or officers to whom such authority is delegated may
award, and the Committee may in its discretion specify any other limitations or
restrictions on the authority delegated to such officer or officers.
PARTICIPATION. The Committee may make awards to directors, officers,
employees, consultants, advisers and independent contractors of the Company or
a Related Company. A "Related Company" is any corporation, partnership, joint
venture or other entity in which the Company owns, directly or indirectly, at
least a 20% beneficial ownership interest. The participants in the Plan are
selected from among those eligible in the sole discretion of the Committee.
AWARDS TO PARTICIPANTS.
1. Stock Options.
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Incentive stock options ("ISOs") and non-qualified stock options may be
granted for such number of shares of Common Stock as the Committee
determines, provided that no participant may be granted stock options in
any calendar year on more than 250,000 shares of Common Stock. A stock
option will be exercisable at such times, over such term and subject to
such terms and conditions as the Committee determines, provided that in
the case of participants other than directors, officers, consultants or
independent contractors stock options must become exercisable at the rate
of at least 20% per year over five years from the date the stock option is
granted. The exercise price of stock options is determined by the
Committee, but may not be less than the per share fair market value of the
Common Stock on the date of grant, or 110% of such fair market value if
the recipient owns, or would be considered to own by reason of
Section 424(d) of the Code, more than 10% of the total combined voting
power of all classes of stock of the Company or any parent or subsidiary
of the Company. (ISOs are subject to restrictions as to exercise period
and exercise price as required by the Code.)
Payment of the exercise price may be made in such manner as the Committee
may provide, including cash, delivery of shares of Common Stock already
owned or subject to award under the Plan. The Committee may provide that
all or part of the shares received upon exercise of an option using
restricted stock will be restricted stock.
Upon an optionee's termination of employment or other qualifying
relationship, the option will be exercisable to the extent determined by
the Committee; provided, however, that unless employment or such other
qualifying relationship is terminated for cause (as may be defined by the
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Committee in connection with the grant of any stock option), the Stock
Option shall remain exercisable (to the extent that it was otherwise
exercisable on the date of termination) for at least six months from the
date of termination if termination was caused by death or disability or at
least 90 days from the date of termination if termination was caused by
other than death or disability. The Committee may provide that an option
that is outstanding on the date of an optionee's death will remain
outstanding for an additional period after the date of such death,
notwithstanding that such option would expire earlier under its terms.
A stock option agreement may permit an optionee to transfer the stock
option to his or her children, grandchildren or spouse ("Immediate
Family"), to one or more trusts for the benefit of such Immediate Family
members, or to one or more partnerships in which such Immediate Family
members are the only partners if (i) the agreement setting forth the stock
option expressly provides that the option may be transferred only with the
express written consent of the Committee, and (ii) the optionee does not
receive any consideration in any form whatsoever for such transfer. Any
stock option so transferred will continue to be subject to the same terms
and conditions as were applicable to the option immediately prior to its
transfer. Except as described above, stock options are not transferable
by the optionee otherwise than by will or by the laws of descent and
distribution.
2. Restricted Stock.
-----------------
In making an award of restricted stock, the Committee will determine the
periods, if any, during which the stock is subject to forfeiture, and the
purchase price, if any, for the stock. The vesting of restricted stock
may be unconditional or may be conditioned upon the completion of a
specified period of service with the Company or a Related Company, the
attainment of specific performance goals or such other criteria as the
Committee may determine.
During the restricted period, the award holder may not sell, transfer,
pledge or assign the restricted stock, except as may be permitted by the
Committee. The certificate evidencing the restricted stock will be
registered in the award holder's name, although the Committee may direct
that it remain in the possession of the Company until the restrictions
have lapsed. Except as may otherwise be provided by the Committee, upon
the termination of the award holder's service with the Company or a
Related Company for any reason during the period before all restricted
stock has vested, or in the event the conditions to vesting are not
satisfied, all restricted stock that has not vested will be subject to
forfeiture and the Committee may provide that any purchase price paid by
the award holder, or an amount equal to the restricted stock's fair market
value on the date of forfeiture, if lower, will be paid to the award
holder. During the restricted period, the award holder will have the
right to vote the restricted stock and to receive any cash dividends, if
so provided by the Committee. Stock dividends will be treated as
additional shares of restricted stock and will be subject to the same
terms and conditions as the initial grant, unless otherwise provided by
the Committee.
CHANGE IN CONTROL PROVISIONS. If there is a Change of Control of the
Company (as defined below), all stock options which are not then exercisable
will become fully exercisable and vested, and the restrictions applicable to
restricted stock will lapse and such shares and awards will be deemed fully
vested, unless otherwise determined by the Committee at the time of grant. A
Change of Control occurs on the date that any person or group (other than the
Company or certain of its affiliates) becomes a beneficial owner of 40% or more
of the Company's voting securities, the date on which a majority of the Board of
Directors consists of persons other than Incumbent Directors (as defined in the
Plan) or the date of approval by the shareholders of certain agreements
providing for the merger, consolidation or disposition of all or substantially
all the assets of the Company.
AMENDMENT AND TERMINATION. No awards may be granted under the Plan more
than 10 years after the date of approval of the Plan by the shareholders of the
Company. The Board may discontinue the Plan at any earlier time and may amend
it from time to time, except that no amendment or discontinuation may adversely
affect any outstanding award without the holder's written consent. Amendments
may be made without shareholder approval except as required to satisfy any
applicable mandatory legal or regulatory requirements, or as required for the
Plan to satisfy the requirements of Section 162(m), Section 422 of the Code or
any other non-mandatory legal or regulatory requirements if the Board of
Directors deems it desirable for the Plan to satisfy any such requirements.
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ADJUSTMENT. In the event of any merger, reorganization, consolidation,
sale of substantially all assets, recapitalization, stock dividend, stock split,
spin-off, split-up, split-off, distribution of assets or other change in
corporate structure affecting the Common Stock, a substitution or adjustment, as
may be determined to be appropriate by the Committee in its sole discretion,
will be made in the aggregate number of shares reserved for issuance under
the Plan, the maximum number of shares with respect to which stock options
may be granted to any participant during any calendar year, the number of
shares subject to outstanding awards and the amounts to be paid by award
holders or the Company, as the case may be, with respect to outstanding awards.
No such adjustment may increase the aggregate value of any outstanding award.
SUBSTITUTE OPTIONS IN BUSINESS COMBINATIONS. If the Company succeeds to
the business of another corporation through a merger or consolidation, or
through the acquisition of stock or assets of such corporation, stock options
may be granted under the Plan to those employees of such corporation or its
related companies who become employees of the Company or a Related Company in
substitution for options to purchase stock of the acquired corporation held by
them at the time of such succession. The Committee, in its sole discretion,
will determine the extent to which and the terms on which any such substitute
stock options will be granted. The exercise price of each substitute stock
option will be an amount such that, in the sole judgment of the Committee (and
if the stock options to be granted are intended to be ISOs, in compliance with
the Code), the economic benefit provided by such substitute stock option is not
greater than the economic benefit represented by the stock option of the
acquired corporation as of the date of the acquisition. Any substitute stock
option will expire upon the expiration date of such other stock option or, if
earlier, 10 years after the date of grant of the substitute stock option, and
will be exercisable during the period(s) in which the other stock option would
have been exercisable.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of
certain federal income tax aspects of awards made under the Plan based upon the
laws in effect on April 1, 1996.
1. Incentive Stock Options.
------------------------
Generally, no taxable income is recognized by the participant upon the
grant of an ISO or upon the exercise of an ISO during the period of the
participant's employment with the Company or one of its subsidiaries or
within three months (12 months, in the event of permanent and total
disability, or the term of the option, in the event of death) after
termination. However, the exercise of an ISO may result in an alternative
minimum tax liability to the participant. If the participant continues to
hold the shares acquired upon the exercise of an ISO for at least two
years from the date of grant and one year from the transfer of the shares
to the participant, then generally: (a) upon the sale of the shares, any
amount realized in excess of the option price will be taxed as long-term
capital gain; and (b) no deduction will be allowed to the employer
corporation for federal income tax purposes.
If Common Stock acquired upon the exercise of an ISO is disposed of prior
to the expiration of the one-year and two-year holding periods described
above (a "disqualifying disposition"), then generally: (a) the
participant will recognize ordinary income in an amount equal to the
excess, if any, of the fair market value of the shares on the date of
exercise (or, if less, the amount realized on disposition of the shares)
over the option exercise price; and (b) the employer corporation will be
entitled to deduct any such recognized amount. Any further gain
recognized by the participant on such disposition generally will be taxed
as short-term or long-term capital gain, depending on whether the shares
were held by the participant for more than one year, but such additional
amounts will not be deductible by the employer corporation.
According to proposed Treasury Regulations, in general, no gain or loss
will be recognized by a participant who uses shares of Common Stock rather
than cash to exercise an ISO. A number of new shares of Common Stock
acquired equal to the number of shares surrendered will have a basis and
capital gain holding period equal to those of the shares surrendered
(although such shares will be subject to new holding periods for
disqualifying disposition purposes beginning on the acquisition date). To
the extent new shares of Common Stock acquired pursuant to the exercise of
the ISO exceed the number of shares surrendered, such additional shares
will have a zero basis and will have a holding period beginning on the
date the ISO is exercised. The use of Common Stock acquired through
exercise of an ISO to exercise an ISO will constitute a disqualifying
disposition with respect to such Common Stock if the applicable holding
period requirement has not been satisfied.
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<PAGE> 8
2. Non-Qualified Stock Options.
----------------------------
Except as noted below with respect to officers and directors subject to
Section 16 of the Exchange Act ("Insiders"), with respect to non-qualified
stock options: (a) no income is recognized by the participant at the time
the option is granted; (b) generally upon exercise of the option, the
participant recognizes ordinary income in an amount equal to the
difference between the option exercise price and the fair market value of
the shares on the date of exercise and the employer corporation will be
entitled to a tax deduction in the same amount, to the extent that such
income is considered reasonable compensation; and (c) at disposition, any
appreciation after the date of exercise generally is treated either as
short-term or long-term capital gain, depending on whether the shares were
held by the participant for more than one year, and such appreciation is
not deductible by the employer corporation.
No gain or loss will be recognized by a participant with respect to shares
of Common Stock surrendered to exercise a non-qualified stock option. A
number of new shares acquired equal to the number of shares surrendered
will have a tax basis and capital gain holding period equal to those of
the shares surrendered. The participant will recognize ordinary income in
an amount equal to the fair market value of the additional shares acquired
at the time of exercise (except as noted below with respect to Insiders).
Such additional shares will be deemed to have been acquired on the date of
such recognition of income and will have a tax basis equal to their fair
market value on such date.
3. Restricted Stock.
-----------------
A participant receiving restricted stock generally will recognize income
in the amount of the fair market value of the restricted stock at the time
the stock is no longer either non-transferable or subject to a substantial
risk of forfeiture, whichever comes first, less the consideration, if any,
paid for the stock. However, a participant may elect, under Section 83(b)
of the Code, to recognize ordinary income on the date of grant in an
amount equal to the excess of the fair market value of the shares on such
date (determined without regard to the restrictions other than
restrictions which by their terms will never lapse) over their purchase
price. The holding period to determine whether the participant has long-
term or short-term capital gain on a subsequent disposition of the shares
generally begins when income was recognized, and the tax basis for such
shares generally will be the amount of income that was recognized (i.e.,
the fair market value of such shares on such date).
4. Special Rules Applicable to Insiders.
-------------------------------------
If an Insider exercises a non-qualified stock option within six months of
its grant, the income recognition date is generally the date six months
after the date of grant, unless the Insider makes an election under
Section 83(b) of the Code to recognize income as of the date of exercise.
The Insider recognizes ordinary income equal to the excess of the fair
market value of the shares on the income recognition date over the option
exercise price, and the holding period for treating any subsequent gain as
long-term capital gain begins on the income recognition date.
5. Dividends.
----------
Dividends paid on restricted stock prior to the date on which the
forfeiture restrictions lapse generally will be treated as compensation
that is taxable as ordinary income to the participant and will be
deductible by the employer corporation. If, however, the participant
makes a Section 83(b) election with respect to the restricted stock, the
dividends will be taxable as ordinary dividend income to the participant
and will not be deductible by the employer corporation.
6. Withholding Taxes.
------------------
A participant in the Plan may be required to pay the employer corporation
an amount necessary to satisfy the applicable federal and state law
requirements with respect to the withholding of taxes on wages, or to make
some other arrangements to comply with such requirements. The employer
has the right to withhold from salary or otherwise to cause a participant
(or the executor or administrator of the participant's estate or the
-8-
<PAGE> 9
participant's distributee or transferee) to make payment of any federal,
state, local or other taxes required to be withheld with respect to any
award under the Plan. The Plan authorizes the Committee to permit
participants to use the shares issuable under the Plan to satisfy
withholding obligations.
7. Company Deductions.
-------------------
As a general rule, the Company or one of its subsidiaries will be entitled
to a deduction for federal income tax purposes at the same time and in the
same amount that a participant in the Plan recognizes ordinary income from
awards under the Plan, to the extent that such income is considered
reasonable compensation and currently deductible (and not capitalized)
under the Code. However, Section 162(m) of the Code limits to $1 million
the annual tax deduction that the Company and its subsidiaries can take
with respect to the compensation of each of certain executive officers
unless the compensation qualifies as "performance based" or certain other
exemptions apply.
BENEFITS UNDER THE PLAN
No awards have been granted under the Plan, and no awards will be granted unless
the Plan is approved by the shareholders. As of April 17, 1996, there were
approximately 53 employees and directors of the Company and Related Companies
eligible to participate in the Plan. The benefits that will be received by or
allocated to various participants in the Plan is not currently determinable. On
April 17, 1996, the closing per share bid price of the Common Stock was $3.50.
SHAREHOLDERS ARE URGED IMMEDIATELY TO COMPLETE, DATE AND SIGN THE ENCLOSED
REVISED PROXY AND RETURN IT IN THE ENVELOPE PROVIDED, TO WHICH NO POSTAGE NEED
BE AFFIXED IF MAILED IN THE UNITED STATES.
By the Board of Directors
/s/ JoAnn R. Stover
--------------------------
JoAnn R. Stover
Secretary
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<PAGE> A-1
Appendix A
HEMACARE CORPORATION
1996 STOCK INCENTIVE PLAN
SECTION 1. Purposes.
---------
The purposes of the HemaCare Corporation 1996 Stock Incentive Plan (the
"Plan") are to (i) enable HemaCare Corporation (the "Company") and Related
Companies (as defined below) to attract, motivate and retain top-quality
directors, officers, employees, consultants, advisers and independent
contractors (including without limitation dealers, distributors and other
business entities or persons providing services on behalf of the Company or a
Related Company), (ii) provide substantial incentives for such directors,
officers, employees, consultants, advisers and independent contractors of the
Company or a Related Company ("Participants") to act in the best interests of
the shareholders of the Company and (iii) reward extraordinary effort by
Participants on behalf of the Company or a Related Company. For purposes of
the Plan, a "Related Company" means any corporation, partnership, joint venture
or other entity in which the Company owns, directly or indirectly, at least a
twenty percent (20%) beneficial ownership interest.
SECTION 2. Types of Awards. Awards under the Plan may be in the form of
----------------
(i) Stock Options or (ii) Restricted Stock.
SECTION 3. Administration.
---------------
3.1 Except as otherwise provided herein, the Plan shall be administered
by the Compensation Committee of the Board of Directors of the Company (the
"Board") or such other committee of directors as the Board shall designate,
which committee in either such case shall consist solely of not less than two
"non-employee directors" (as such term is defined in Rule 16b-3 under the
Securities Exchange Act of 1934 (the "Exchange Act") or any successor rule
("Rule 16b-3")) who shall serve at the pleasure of the Board, each of whom
shall also be an "outside director" within the meaning of Section 162(m) of
the Internal Revenue Code and Section 1.162-27 of the Treasury Regulations or
any successor provision(s) thereto ("Section 162(m)"); provided, however, that
if there are not two persons on the Board who meet the foregoing qualifications,
any such committee may be comprised of two or more directors of the Company,
none of which is an officer (other than a non-employee Chairman of the Board
of the Company) or an employee of the Company or a Related Company. If no
such committee has been appointed by the Board, the Plan shall be administered
by the Board, and the Plan shall be administered by the Board to the extent
provided in the last sentence of this Section. Such committee as shall be
designated to administer the Plan, if any, or the Board is referred to herein
as the "Committee." Nothwithstanding any other provision of the Plan to the
contrary, if such a committee has been designated to administer the Plan, all
actions with respect to the administration of the Plan in respect of the
members of such committee shall be taken by the Board.
3.2 The Committee shall have the following authority with respect to
awards under the Plan to Participants: to grant awards to eligible Participants
under the Plan; to adopt, alter and repeal such administrative rules, guidelines
and practices governing the Plan as it shall deem advisable; to interpret the
terms and provisions of the Plan and any award granted under the Plan; and to
otherwise supervise the administration of the Plan. In particular, and without
limiting its authority and powers, the Committee shall have the authority:
(a) to determine whether and to what extent any award or
combination of awards will be granted hereunder;
(b) to select the Participants to whom awards will be
granted;
(c) to determine the number of shares of the common stock of
the Company (the "Stock") to be covered by each award granted
hereunder, provided that no Participant will be granted Stock
Options on or with respect to more than 250,000 shares of Stock in
any calendar year;
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<PAGE> A-2
(d) to determine the terms and conditions of any award
granted hereunder, including, but not limited to, any vesting or
other restrictions based on performance and such other factors as
the Committee may determine, and to determine whether the terms and
conditions of the award are satisfied;
(e) to determine the treatment of awards upon a
Participant's retirement, disability, death, termination for cause
or other termination of employment or other qualifying relationship
with the Company or a Related Company;
(f) to determine that amounts equal to the amount of any
dividends declared with respect to the number of shares covered by
an award (i) will be paid to the Participant currently or (ii) will
be deferred and deemed to be reinvested or (iii) will otherwise be
credited to the Participant, or that the Participant has no rights
with respect to such dividends;
(g) to determine whether, to what extent, and under what
circumstances Stock and other amounts payable with respect to an
award will be deferred either automatically or at the election of a
Participant, including providing for and determining the amount (if
any) of deemed earnings on any deferred amount during any deferral
period;
(h) to provide that the shares of Stock received as a result
of an award shall be subject to a right of first refusal, pursuant
to which the Participant shall be required to offer to the Company
any shares that the Participant wishes to sell, subject to such
terms and conditions as the Committee may specify;
(i) to amend the terms of any award, prospectively or
retroactively; provided, however, that no amendment shall impair the
rights of the award holder without his or her consent; and
(j) to substitute new Stock Options for previously granted
Stock Options, or for options granted under other plans, in each
case including previously granted options having higher option
prices.
3.3 All determinations made by the Committee pursuant to the provisions
of the Plan shall be final and binding on all persons, including the Company and
all Participants.
3.4 The Committee may from time to time delegate to one or more officers
of the Company any or all of its authorities granted hereunder except with
respect to awards granted to persons subject to Section 16 of the Exchange Act.
The Committee shall specify the maximum number of shares that the officer or
officers to whom such authority is delegated may award, and the Committee may in
its discretion specify any other limitations or restrictions on the authority
delegated to such officer or officers.
SECTION 4. Stock Subject to Plan.
----------------------
4.1 The total number of shares of Stock reserved and available for
distribution under the Plan shall be 750,000 (subject to adjustment as provided
in Section 4.3); provided, however, that no award of a Stock Option or
Restricted Stock may be made at any time if, after giving effect to such
award, the total number of shares of Stock issuable upon exercise of all
outstanding options and warrants of the Company (whether or not under the Plan)
plus the total number of shares of Stock called for under any stock bonus or
similar plan of the Company (including shares of Stock underlying awards of
Stock Options or Restricted Stock under the Plan) would exceed thirty percent
(30%) of the total number of shares of Stock outstanding at the time of such
award. For purposes of the foregoing: (i) those shares issuable upon exercise
of rights, options or warrants, or under a stock purchase plan, meeting the
requirements for exclusion set forth at any time and from time to time in Rule
260.140.45 of the California Commissioner ofCorporations shall not be counted
against the thirty percent (30%) limitation; (ii) any outstanding preferred or
senior common shares of the Company convertible into Stock shall be deemed
converted in determining the total number of outstanding shares of Stock at
any time; and (iii) any shares of Stock subject to promotional waivers under
Rule 260.141 of the California Commissioner of Corporations shall not be
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<PAGE> A-3
deemed to be outstanding. Shares of Stock issuable in connection with any
award under the Plan may consist of authorized but unissued shares or treasury
shares.
4.2 To the extent a Stock Option terminates without having been
exercised, or shares awarded are forfeited, the shares subject to such award
shall again be available for distribution in connection with future awards under
the Plan, subject to the limitations set forth in Section 4.1, unless the
forfeiting Participant received any benefits of ownership such as dividends from
the forfeited award.
4.3 In the event of any merger, reorganization, consolidation, sale of
substantially all assets, recapitalization, Stock dividend, Stock split, spin-
off, split-up, split-off, distribution of assets or other change in corporate
structure affecting the Stock, a substitution or adjustment, as may be
determined to be appropriate by the Committee in its sole discretion, shall
be made in the aggregate number of shares reserved for issuance under the Plan,
the number of shares subject to outstanding awards and the amounts to be paid by
award holders or the Company, as the case may be, with respect to outstanding
awards; provided, however, that no such adjustment shall increase the aggregate
value of any outstanding award. In the event any change described in this
Section 4.3 occurs and an adjustment is made in the outstanding Stock Options,
a similar adjustment shall be made in the maximum number of shares covered by
Stock Options that may be granted to any employee pursuant to Section 3.2(c).
SECTION 5. Eligibility.
------------
Participants under the Plan shall be selected from time to time by the
Committee, in its sole discretion, from among those eligible.
SECTION 6. Stock Options.
--------------
6.1 The Stock Options awarded to officers and employees under the Plan
may be of two types: (i) Incentive Stock Options within the meaning of
Section 422 of the Internal Revenue Code or any successor provision thereto
("Section 422"); and (ii) Non-Qualified Stock Options. If any Stock Option does
not qualify as an Incentive Stock Option, or the Committee at the time of grant
determines that any Stock Option shall be a Non-Qualified Stock Option, it shall
constitute a Non-Qualified Stock Option. Stock Options awarded to any
Participant who is not an officer or employee of the Company or a Related
Company shall be Non-Qualified Stock Options.
6.2 Subject to the following provisions, Stock Options awarded to
Participants under the Plan shall be in such form and shall have such terms and
conditions as the Committee may determine:
(a) Option Price. The option price per share of Stock
purchasable under a Stock Option shall be determined by the
Committee; provided, however, that the option price per share of
Stock shall be not less than one hundred percent (100%) of the "Fair
Market Value" (as defined below) of the Stock on the date of grant
of the Stock Option; and provided, further, that if at the time of
grant the Participant owns, or would be considered to own by reason
of Section 424(d) of the Internal Revenue Code or any successor
provision thereto, more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or any parent or
subsidiary of the Company, the option price per share of Stock shall
be not less than one hundred ten percent (110%) of the Fair Market
Value of the Stock on the date of grant of the Stock Option. For
purposes of the Plan, "Fair Market Value" in relation to a share of
the Stock means, if the Stock is publicly traded, the closing per
share bona fide bid price of the Stock on such date. In any
situation not covered above, the Fair Market Value shall be
determined by the Committee in accordance with one of the valuation
methods described in Section 20.2031-2 of the Federal Estate Tax
Regulations or any successor provision thereto.
(b) Option Term. The term of each Stock Option shall be
fixed by the Committee, but in no event longer than one hundred
twenty (120) months after the date of grant of such Stock Option.
(c) Exercisability. Stock Options shall be exercisable at
such time or times and subject to such terms and conditions as shall
be determined by the Committee; provided, however, that in the case
of Stock Options awarded to Participants other than directors,
officers, consultants or independent contractors, Stock Options
under any award shall become exercisable at the rate of at least
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<PAGE> A-4
twenty percent (20%) per year over five (5) years from the date the
Stock Option is granted. If the Committee provides that any Stock
Option is exercisable only in installments, the Committee may waive
such installment exercise provisions at any time in whole or in
part.
(d) Method of Exercise. Stock Options may be exercised in
whole or in part at any time during the option period by giving
written notice of exercise to the Company specifying the number of
shares to be purchased, accompanied by payment of the purchase
price. Payment of the purchase price shall be made in such manner
as the Committee may provide in the award, which may include cash
(including cash equivalents), delivery of shares of Stock already
owned by the optionee or subject to awards hereunder, any other
manner permitted by law as determined by the Committee, or any
combination of the foregoing. The Committee may provide that all or
part of the shares received upon the exercise of a Stock Option
which are paid for using Restricted Stock shall be restricted in
accordance with the original terms of the award in question.
(e) No Shareholder Rights. An optionee shall have no rights
to dividends or other rights of a shareholder with respect to shares
subject to a Stock Option until the optionee has given written
notice of exercise and has paid for such shares.
(f) Surrender Rights. The Committee may provide that Stock
Options may be surrendered for cash upon any terms and conditions
set by the Committee.
(g) Non-Transferability; Limited Transferability. A Stock
Option Agreement may permit an optionee to transfer the Stock Option
to his or her children, grandchildren or spouse ("Immediate
Family"), to one or more trusts for the benefit of such Immediate
Family members, or to one or more partnerships in which such
Immediate Family members are the only partners if (i) the agreement
setting forth such Stock Option expressly provides that such Stock
Option may be transferred only with the express written consent of
the Committee, and (ii) the optionee does not receive any
consideration in any form whatsoever for such transfer. Any Stock
Option so transferred shall continue to be subject to the same terms
and conditions as were applicable to such Stock Option immediately
prior to the transfer thereof. Any Stock Option not (x) granted
pursuant to any agreement expressly allowing the transfer of such
Stock Option or (y) amended expressly to permit its transfer shall
not be transferable by the optionee otherwise than by will or by the
laws of descent and distribution, and such Stock Option shall be
exercisable during the optionee's lifetime only by the optionee.
(h) Termination of Relationship. If an optionee's
employment or other qualifying relationship with the Company or a
Related Company terminates by reason of death, disability,
retirement, voluntary or involuntary termination or otherwise, the
Stock Option shall be exercisable to the extent determined by the
Committee; provided, however, that unless employment or such other
qualifying relationship is terminated for cause (as may be defined
by the Committee in connection with the grant of any Stock Option),
the Stock Option shall remain exercisable (to the extent that it was
otherwise exercisable on the date of termination) for (A) at least
six (6) months from the date of termination if termination was
caused by death or disability or (B) at least ninety (90) days from
the date of termination if termination was caused by other than
death or disability. The Committee may provide that,
notwithstanding the option term fixed pursuant to Section 6.2(b), a
Stock Option which is outstanding on the date of an optionee's death
shall remain outstanding for an additional period after the date of
such death.
(i) Option Grants to Participants Subject to Section 16. If
for any reason any Stock Option granted to a Participant subject to
Section 16 of the Exchange Act is not approved in the manner
provided for in clause (d)(1) or (d)(2) of Rule 16b-3, neither the
Stock Option (except upon its exercise) nor the Stock underlying the
Stock Option may be disposed of by the Participant until six months
have elapsed following the date of grant of the Stock Option, unless
the Committee otherwise specifically permits such disposition.
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<PAGE> A-6
6.3 Notwithstanding the provisions of Section 6.2, no Incentive Stock
Option shall (i) have an option price which is less than one hundred
percent (100%) of the Fair Market Value of the Stock on the date of the award of
the Stock Option (or less than one hundred ten percent (110%) of the Fair Market
Value of the Stock on the date of award of the Stock Option if the Participant
owns, or would be considered to own by reason of Section 424(d) of the Internal
Revenue Code or any successor provision thereto, more than ten percent (10%) of
the total combined voting power of all classes of stock of the Company or any
parent or subsidiary of the Company at the time of the grant of the Stock
Option), (ii) be exercisable more than ten (10) years after the date such
Incentive Stock Option is awarded (five (5) years after the date of award if the
Participant owns, or would be considered to own by reason of Section 424(d) of
the Internal Revenue Code or any successor provision thereto, more than ten
percent (10%) of the total combined voting power of all classes of stock of the
Company or any parent or subsidiary of the Company at the time of the grant of
the Stock Option), (iii) be awarded more than ten (10) years after the effective
date of the Plan (or the latest restatement of the Plan) or (iv) be transferable
other than by will or by the laws of descent and distribution. In addition, the
aggregate Fair Market Value (determined as of the time a Stock Option is
granted)of Stock with respect to which Incentive Stock Options granted after
December 31, 1986 are exercisable for the first time by a Participant in any
calendar year (under the Plan and any other plans of the Company or any
subsidiary or parent corporation) shall not exceed $100,000.
SECTION 7. Restricted Stock.
-----------------
Subject to the following provisions, all awards of Restricted Stock to
Participants shall be in such form and shall have such terms and conditions as
the Committee may determine:
(a) The Restricted Stock award shall specify the number of
shares of Restricted Stock to be awarded, the price, if any, to be
paid by the recipient of the Restricted Stock and the date or dates
on which, or the conditions upon the satisfaction of which, the
Restricted Stock will vest. The vesting of Restricted Stock may be
conditioned upon the completion of a specified period of service
with the Company or a Related Company, upon the attainment of
specified performance goals or upon such other criteria as the
Committee may determine.
(b) Stock certificates representing the Restricted Stock
awarded to an employee shall be registered in the Participant's
name, but the Committee may direct that such certificates be held by
the Company on behalf of the Participant. Except as may be
permitted by the Committee, no share of Restricted Stock may be
sold, transferred, assigned, pledged or otherwise encumbered by the
Participant until such share has vested in accordance with the terms
of the Restricted Stock award. At the time Restricted Stock vests,
a certificate for such vested shares shall be delivered to the
Participant (or his or her designated beneficiary in the event of
death), free of all restrictions.
(c) The Committee may provide that the Participant shall
have the right to vote or receive dividends, or both, on Restricted
Stock. The Committee may provide that Stock received as a dividend
on, or in connection with a stock split of, Restricted Stock shall
be subject to the same restrictions as the Restricted Stock.
(d) Except as may be provided by the Committee, in the event
of a Participant's termination of employment or other qualifying
relationship with the Company or a Related Company before all of his
or her Restricted Stock has vested, or in the event any conditions
to the vesting of Restricted Stock have not been satisfied prior to
any deadline for the satisfaction of such conditions set forth in
the award, the shares of Restricted Stock which have not vested
shall be forfeited, and the Committee may provide that the lower of
(i) any purchase price paid by the Participant and (ii) the
Restricted Stock's aggregate Fair Market Value on the date of
forfeiture shall be paid in cash to the Participant.
(e) The Committee may waive, in whole or in part, any or all
of the conditions to receipt of, or restrictions with respect to,
any or all of the Participant's Restricted Stock.
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<PAGE> A-6
(f) If for any reason any Restricted Stock awarded to a
Participant subject to Section 16 of the Exchange Act is not
approved in the manner provided for in clause (d)(1) or (d)(2) of
Rule 16b-3, the Restricted Stock may not be disposed of by the
Participant until six months have elapsed following the date of
award of the Restricted Stock, unless the Committee otherwise
specifically permits such disposition.
SECTION 8. Substitute Options in Business Combinations.
--------------------------------------------
If the Company at any time should succeed to the business of another
corporation through a merger or consolidation, or through the acquisition of
stock or assets of such corporation, Stock Options may be granted under the Plan
to those employees of such corporation or its related companies who, in
connection with such succession, become employees of the Company or a Related
Company in substitution for options to purchase stock of such acquired
corporation held by them at the time of such succession. The Committee, in its
sole discretion, shall determine the extent to which such substitute Stock
Options shall be granted (if at all), the persons to receive such substitute
Stock Options (who need not be all optionees of such corporation), the number
and type of Stock Options to be received by each such person, the exercise price
of such Stock Options (which may be determined without regard to Section 6) and
the terms and conditions of such substitute Stock Options; provided, however,
that the exercise price of each substitute Stock Option shall be an amount such
that, in the sole judgment of the Committee (and if the Stock Options to be
granted are intended to be Incentive Stock Options, in compliance with Section
424(a) of the Code), the economic benefit provided by such Stock Option is not
greater than the economic benefit represented by the stock option of the
acquired corporation as of the date of the Company's acquisition of such
corporation. Any substitute Stock Option granted under this Section 8 shall
expire upon the expiration date of such other stock option or, if earlier, ten
(10) years after the date of grant of the substitute Stock Option, and,
notwithstanding Section 6, shall be exercisable during the period(s) in which
the other stock option would have been exercisable. Any provision of this
Section 8 to the contrary notwithstanding, no Stock Option shall be granted,
nor any action taken, permitted or omitted, which would have the effect of
causing the Plan or any awards hereunder to fail to qualify for exemption
under Rule 16b-3, without the express approval of the Board.
SECTION 9. Election to Defer Awards.
-------------------------
The Committee may permit a Participant to elect to defer receipt of an
award for a specified period or until a specified event, upon such terms as are
determined by the Committee.
SECTION 10. Tax Withholding.
----------------
10.1 Each Participant shall, no later than the date as of which the value
of an award first becomes includible in such person's gross income for
applicable tax purposes, pay to the Company, or make arrangements satisfactory
to the Committee (which may include delivery of shares of Stock already owned
by the optionee or subject to awards hereunder) regarding payment of, any
federal, state, local or other taxes of any kind required by law to be withheld
with respect to the award. The obligations of the Company under the Plan shall
be conditional on such payment or arrangements, and the Company (and, where
applicable, any Related Company), shall, to the extent permitted by law, have
the right to deduct any such taxes from any payment of any kind otherwise due
to the Participant.
10.2 To the extent permitted by the Committee, and subject to such terms
and conditions as the Committee may provide, a Participant may elect to have the
withholding tax obligation, or any additional tax obligation with respect to any
awards hereunder, satisfied by (i) having the Company withhold shares of Stock
otherwise deliverable to such person with respect to the award or (ii)
delivering to the Company shares of unrestricted Stock.
SECTION 11. Amendments and Termination.
---------------------------
No awards may be granted under the Plan more than ten (10) years after the
date of approval of the Plan by the shareholders of the Company. The Board may
discontinue the Plan at any earlier time and may amend it from time to time. No
amendment or discontinuation of the Plan shall adversely affect any award
previously granted without the award holder's written consent. Amendments may
be made without shareholder approval except (i) if and to the extent necessary
to satisfy any applicable mandatory legal or regulatory requirements (including
the requirements of any stock exchange or over-the-counter market on which the
Stock is listed or qualified for trading and any requirements imposed under any
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state securities laws or regulations as a condition to the registration of
securities distributable under the Plan or otherwise), or (ii) as required for
the Plan to satisfy the requirements of Section 162(m), Section 422 or any other
non-mandatory legal or regulatory requirements if the Board of Directors deems
it desirable for the Plan to satisfy any such requirements.
SECTION 12. Change of Control.
------------------
12.1 In the event of a Change of Control, unless otherwise determined by
the Committee at the time of grant or by amendment (with the holder's consent)
of such grant:
(a) all outstanding Stock Options awarded under the Plan
shall become fully exercisable and vested; and
(b) the restrictions applicable to any outstanding
Restricted Stock awards under the Plan shall lapse and such shares
and awards shall be deemed fully vested.
12.2 A "Change of Control" shall be deemed to occur if:
(a) individuals who, as of July 19, 1996, constitute the
entire Board of Directors of the Company ("Incumbent Directors")
cease for any reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director
subsequent to such date whose election, or nomination for election
by the Company's shareholders, was approved by a vote of at least a
majority of the then Incumbent Directors (other than an election or
nomination of an individual whose assumption of office is the result
of an actual or threatened election contest relating to the election
of directors of the Company, as such terms are used in Rule 14a-11
under the Exchange Act), also shall be an Incumbent Director;
(b) the shareholders of the Company shall approve (i) any
merger, consolidation or recapitalization of the Company (or, if the
capital stock of the Company is affected, any subsidiary of the
Company) or any sale, lease, or other transfer (in one transaction
or a series of transactions contemplated or arranged by any party as
a single plan) of all or substantially all of the assets of the
Company (each of the foregoing being an "Acquisition Transaction")
where (1) the shareholders of the Company immediately prior to such
Acquisition Transaction would not immediately after such Acquisition
Transaction beneficially own, directly or indirectly, shares
representing in the aggregate more than fifty percent (50%) of
(A) the then outstanding common stock of the corporation surviving
or resulting from such merger, consolidation or recapitalization or
acquiring such assets of the Company, as the case may be (the
"Surviving Corporation"), (or of its ultimate parent corporation, if
any) and (B) the Combined Voting Power (as defined below) of the
then outstanding Voting Securities (as defined below) of the
Surviving Corporation (or of its ultimate parent corporation, if
any) or (2) the Incumbent Directors at the time of the initial
approval of such Acquisition Transaction would not immediately after
such Acquisition Transaction constitute a majority of the Board of
Directors of the Surviving Corporation (or of its ultimate parent
corporation, if any) or (ii) any plan or proposal for the
liquidation or dissolution of the Company; or
(c) any Person (as defined below) shall become the
beneficial owner (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, of securities of the Company
representing in the aggregate forty percent (40%) or more of either
(i) the then outstanding shares of Company Common Stock or (ii) the
Combined Voting Power of all then outstanding Voting Securities of
the Company; provided, however, that notwithstanding the foregoing,
a Change of Control of the Company shall not be deemed to have
occurred for purposes of this clause (c) solely as the result of:
(1) an acquisition of securities by the Company which,
by reducing the number of shares of Company Common Stock or
other Voting Securities outstanding, increases (i) the
proportionate number of shares of Company Common Stock
beneficially owned by any Person to forty percent (40%) or
more of the shares of Company Common Stock then outstanding or
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(ii) the proportionate voting power represented by the Voting
Securities beneficially owned by any Person to forty
percent (40%) or more of the Combined Voting Power of all then
outstanding Voting Securities; or
(2) an acquisition of securities directly from the
Company except that this paragraph (2) shall not apply to:
(A) any conversion of a security that was not
acquired directly from the Company; or
(B) any acquisition of securities if the
Incumbent Directors at the time of the initial approval
of such acquisition would not immediately after (or
otherwise as a result of) such acquisition constitute a
majority of the Board of the Company;
provided, however, that if any Person referred to in
clauses (1) or (2) of this clause (c) shall thereafter become
the beneficial owner of any additional shares of Company
Common Stock or other Voting Securities of the Company (other
than pursuant to a stock split, stock dividend or similar
transaction or an acquisition exempt under such clause (2)),
then a Change of Control shall be deemed to have occurred for
purposes of this clause (c).
For purposes of this Section 12.2:
(i) "Person" shall mean any individual, entity (including,
without limitation, any corporation, partnership, trust, joint
venture, association or governmental body) or group (as defined in
Section 13(d)(3) or 14(d)(2) of the Exchange Act and the rules and
regulations thereunder); provided, however, that "Person" shall not
include the Company, any of its subsidiaries, any employee benefit
plan of the Company or any of its majority-owned subsidiaries or any
entity organized, appointed or established by the Company or such
subsidiary for or pursuant to the terms of any such plan.
(ii) "Voting Securities" shall mean all securities of a
corporation having the right under ordinary circumstances to vote in
an election of the Board of Directors of such corporation.
(iii) "Combined Voting Power" shall mean the aggregate votes
entitled to be cast generally in the election of directors of a
corporation by holders of then outstanding Voting Securities of such
corporation.
SECTION 13. General Provisions.
-------------------
13.1 If the granting of any award under the Plan or the issuance, purchase
or delivery of Stock thereunder shall require, in the determination of the
Committee from time to time and at any time, (i) the listing, registration or
qualification of the Stock subject or related thereto upon any securities
exchange or over-the-counter market or under any federal or state law or (ii)
the consent or approval of any government regulatory body, then any such award
shall not be granted or exercised, in whole or in part, unless such listing,
registration, qualification, consent or approval shall have been effected or
obtained on conditions, if any, as shall be acceptable to the Committee. In
addition, in connection with the granting or exercising of any award under the
Plan, the Committee may require the recipient to agree not to dispose of any
Stock issuable in connection with such award, except upon the satisfaction of
specified conditions, if the Committee determines such agreement is necessary or
desirable in connection with any requirement or interpretation of any federal or
state securities law, rule or regulation.
13.2 Nothing set forth in this Plan shall prevent the Board from adopting
other or additional compensation arrangements. Neither the adoption of the Plan
nor any award hereunder shall confer upon any employee of the Company, or of a
Related Company, any right to continued employment, and no award under the Plan
shall confer upon any director any right to continued service as a director.
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13.3 Determinations by the Committee under the Plan relating to the form,
amount, and terms and conditions of awards need not be uniform, and may be made
selectively among persons who receive or are eligible to receive awards under
the Plan, whether or not such persons are similarly situated.
13.4 No member of the Board or the Committee, nor any officer or employee
of the Company acting on behalf of the Board or the Committee, shall be
personally liable for any action, determination or interpretation taken or made
with respect to the Plan, and all members of the Board or the Committee and all
officers or employees of the Company acting on their behalf shall, to the extent
permitted by law, be fully indemnified and protected by the Company in respect
of any such action, determination or interpretation.
SECTION 14. Effective Date of Plan.
-----------------------
The Plan shall be effective upon the later of (i) the approval of the Plan
by the shareholders of the Company by a majority of the votes cast at a duly
held meeting of shareholders at which a quorum representing at least a
majority of the outstanding shares is, either in person or by proxy, present and
voting on the Plan, (ii) August 15, 1996, and (iii) the date upon which the
Company becomes subject to the version of Rule 16b-3 adopted by the Securities
and Exchange Commission in Release No. 34-37260 promulgated under the Exchange
Act.
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REVISED PROXY
HEMACARE CORPORATION
This proxy is solicited on behalf of the Board of Directors
The undersigned appoints either or both Thomas M. Asher or Hal I.
Lieberman, as Proxy, with the power to appoint their respective substitutes, and
authorizes either or both of them to represent and to vote, as designated below,
all the shares of Common Stock of HemaCare Corporation held of record by the
undersigned on April 17,1996 at the adjourned Annual Meeting of Shareholders
to be reconvened on July 19, 1996 or any adjournment or postponement thereof.
1. ELECTION OF OFFICERS For Withhold authority
All nominees listed below with authority to / / / /
cumulate votes
(except as marked to the contrary below)
(INSTRUCTIONS: TO WITHHOLD AUTHORITY to vote for any individual nominee,
mark the box next to the nominee's name below.)
/ / THOMAS M. ASHER / / HAL I. LIEBERMAN
/ / GLENN W. BARTLETT / / JON B. VICTOR
2. PROPOSAL TO APPROVE THE COMPANY'S 1996 STOCK INCENTIVE PLAN
/ / FOR / / AGAINST / / ABSTAIN
In his discretion, the Proxy is authorized to vote upon such other
business as may properly come before the meeting.
(Continued and to be signed on back)
This proxy, when properly executed will be voted in the manner directed by
the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1 AND 2. Please sign exactly as name appears on this
proxy. When shares are held by joint tenants, both should sign. When signing
as attorney, executor, administrator, trustee or guardian, please give full
title as such. If a corporation, please sign in full corporate name by
President or other authorized officer. If a partnership, please sign in
partnership name by authorized person.
Dated:.................., 1996
______________________________
______________________________
(Signature if jointly held)
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
