<PAGE>
As filed with the Securities and Exchange Commission on November 4, 1997
Registration No. 333-_____
______________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
_____________________
INNERDYNE, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 87-0431168
(State of Incorporation) (I.R.S. Employer Identification No.)
1244 Reamwood Avenue
Sunnyvale, California 94089
(Address, including zip code, of principal executive offices)
_____________________
1991 DIRECTORS' STOCK OPTION PLAN
1991 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the Plans)
_____________________
William G. Mavity
President and Chief Executive Officer
INNERDYNE, INC.
1244 Reamwood Avenue
Sunnyvale, California 94089
(408) 745-6010
(Name, address and telephone number of agent for service)
_____________________
Copies to:
CATHRYN S. CHINN, ESQ.
Venture Law Group
A Professional Corporation
2800 Sand Hill Road
Menlo Park, California 94025
(650) 854-4488
<PAGE>
<TABLE>
<CAPTION>
____________________________________________________________________________________________________
CALCULATION OF REGISTRATION FEE
____________________________________________________________________________________________________
Proposed Proposed
Title of Maximum Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Per Offering Registration
Registered Registered Share Price Fee
____________________________________________________________________________________________________
<S> <C> <C> <C> <C>
Common Stock, 200,000 $3.375(2) $ 675,000 $204.55
$.01 par value shares(1)
Common Stock, 200,000 $2.869(4) $ 573,800 $173.88
$.01 par value shares(3)
________________ __________________ _______________
TOTAL(5) 400,000 shares $1,248,800 $378.43
</TABLE>
(1) This subtotal represents the additional number of shares authorized to
be issued under the 1991 Directors' Stock Option Plan.
(2) Estimated in accordance with Rule 457(h) under the Securities Act of
1933 (the "Securities Act") solely for the purpose of calculating the
total registration fee. Computation based upon the average of the
high and low prices of the Common Stock as reported in the Nasdaq
National Market System on October 29, 1997.
(3) This subtotal represents the additional number of shares authorized to
be issued under the 1991 Employee Stock Purchase Plan.
(4) Estimated in accordance with Rule 457(h) under the Securities Act
solely for the purpose of calculating the total registration fee.
Computation based upon 85% (see explanation in following sentence) of
the average of the high and low prices of the Common Stock as reported
in the Nasdaq National Market System on October 29, 1997. Pursuant to
Section 7 of the 1991 Employee Stock Purchase Plan, a copy of which is
filed with this Post-Effective Amendment No. 1 to Registration Statement
as Exhibit 4.2, such shares will be issued at 85% of their market value
as of specified dates.
(5) Excludes all shares previously registered under Registrant's 1991
Directors' Stock Option Plan and 1991 Employee Stock Purchase Plan on
Form S-8 (Registration No. 33-49628).
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<PAGE>
PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission are hereby incorporated by reference:
(a)
The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996 filed pursuant to Section 13 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), which contains
audited financial statements for the Registrant's latest fiscal year
for which such statements have been filed.
(b)
The Registrant's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1997 and June 30, 1997 filed pursuant to Section 13
of the Exchange Act.
(c)
Items 1 and 2 of the Registrant's Registration Statement on Form 8-A
filed on September 22, 1997 pursuant to Section 12 of the Exchange Act.
Also Items 1 and 2 of the Registrant's Registration Statement on
Form 8-A filed on December 4, 1991 pursuant to Section 12 of the
Exchange Act.
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 which indicates that all securities offered hereby
have been sold or which deregisters all securities then remaining unsold,
shall be deemed to be incorporated by reference in this Registration
Statement and to be part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES. Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's Certificate of Incorporation reduces the liability of a
director to the corporation or its stockholders for monetary damages for
breaches of his or her fiduciary duty of care to the fullest extent
permissible under Delaware law. The Bylaws of the Registrant further provide
for indemnification of corporate agents to the maximum extent permitted by
the Delaware General Corporation Law. In addition, the Registrant has entered
into Indemnification Agreements with its officers and directors.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable.
ITEM 8. EXHIBITS.
Exhibit Number Description
-------------- ------------------------------------------
4.1 1991 Directors' Stock Option Plan.
4.2 1991 Employee Stock Purchase Plan.
5.1 Opinion of Venture Law Group, A Professional
Corporation.
-3-
<PAGE>
23.1 Consent of Venture Law Group, A Professional
Corporation (included in Exhibit 5.1).
23.2 Consent of Independent Auditors (see p. 7).
24.1 Power of Attorney (see p. 5).
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement to include
any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to
such information in the registration statement.
(2) that, for purposes of determining any liability under the
Securities Act, 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.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as the indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in a successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered hereunder, the
Registrant will, unless in the opinion of its counsel the question has
already 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 and will be
governed by the final adjudication of such issue.
[Signature Pages Follow]
-4-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant, InnerDyne, Inc., a corporation organized and existing under the
laws of the State of Delaware, 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 Sunnyvale, State of
California, on October 31, 1997.
INNERDYNE, INC.
By: /s/ WILLIAM G. MAVITY
-----------------------------------
William G. Mavity, President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints William G. Mavity and Robert A. Stern,
jointly and severally, his or her attorneys-in-fact and agents, each with the
power of substitution and resubstitution, for him or her and in his or her
name, place or stead, in any and all capacities, to sign any amendments to
this Registration Statement on Form S-8, and to file such amendments,
together with exhibits and other documents in connection therewith, with the
Securities and Exchange Commission, granting to each attorney-in-fact and
agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully
as he or she might or could do in person, and ratifying and confirming all
that the attorneys-in-fact and agents, or his or her substitute or
substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-8 has been signed by the following persons
in the capacities and on the dates indicated.
Signature Title Date
- ---------------------------- ----------------------- ----------
/s/ WILLIAM G. MAVITY President and Chief Executive October 31, 1997
- ---------------------------- Officer (Principal Executive
(William G. Mavity) Officer)
/s/ ROBERT A. STERN Vice President and Chief October 31, 1997
- ---------------------------- Financial Officer (Principal
(Robert A. Stern) Financial and Accounting
Officer)
/s/ EDWARD W. BENECKE Director October 31, 1997
- ----------------------------
(Edward W. Benecke)
/s/ ROBERT M. CURTIS Director October 31, 1997
- ----------------------------
(Robert M. Curtis)
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<PAGE>
/s/ EUGENE J. FISCHER Director October 31, 1997
- ----------------------------
(Eugene J. Fischer)
/s/ GUY P. NOHRA Director October 31, 1997
- ----------------------------
(Guy P. Nohra)
/s/ STEVEN N. WEISS Director October 31, 1997
- ----------------------------
(Steven N. Weiss)
-6-
<PAGE>
Exhibit 23.2
The Board of Directors and Stockholders
InnerDyne, Inc.:
We consent to incorporation by reference in the registration statement on
Form S-8 of InnerDyne, Inc. of our report dated January 29, 1997, relating to
the balance sheets of InnerDyne, Inc. as of December 31, 1996 and 1995, and
the related statements of operations, stockholders' equity and cash flows for
each of the years in the three-year period ended December 31, 1996, which
report appears in the December 31, 1996 annual report on Form 10-K of
InnerDyne, Inc.
KPMG Peat Marwick LLP
Salt Lake City, Utah
October 31, 1997
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<PAGE>
INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION
-------------- -------------------------------------
4.1 1991 Directors' Stock Option Plan.
4.2 1991 Employee Stock Purchase Plan.
5.1 Opinion of Venture Law Group, A Professional Corporation.
23.1 Consent of Venture Law Group, A Professional Corporation
(included in Exhibit 5.1).
23.2 Consent of Independent Auditors (see p. 7).
24.1 Power of Attorney (see p. 5).
<PAGE>
Exhibit 4.1
INNERDYNE, INC.
1991 DIRECTORS' STOCK OPTION PLAN
1. PURPOSES OF THE PLAN. The purposes of this Directors' Stock Option
Plan are to attract and retain the best available individuals for service as
Directors of the Company, to provide additional incentive to the Outside
Directors of the Company to serve as Directors, and to encourage their
continued service on the Board.
All options granted hereunder shall be "nonstatutory stock options."
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "BOARD" shall mean the Board of Directors of the Company.
(b) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
(c) "COMMON STOCK" shall mean the Common Stock of the Company.
(d) "COMPANY" shall mean Innerdyne, Inc., a Delaware corporation.
(e) "CONTINUOUS STATUS AS A DIRECTOR" shall mean the absence of any
interruption or termination of service as a Director.
(f) "DIRECTOR" shall mean a member of the Board.
(g) "EMPLOYEE" shall mean any person, including officers and
Directors, employed by the Company or any Parent or Subsidiary of the
Company. The payment of a director's fee by the Company shall not be
sufficient in and of itself to constitute "employment" by the Company.
(h) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended.
(i) "OPTION" shall mean a stock option granted pursuant to the Plan.
(j) "OPTIONED STOCK" shall mean the Common Stock subject to an
Option.
(k) "OPTIONEE" shall mean an Outside Director who receives an Option.
(l) "OUTSIDE DIRECTOR" shall mean a Director who is not an Employee.
(m) "PARENT" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
<PAGE>
(n) "PLAN" shall mean this 1991 Directors' Stock Option Plan.
(o) "SHARE" shall mean a share of the Common Stock, as adjusted in
accordance with Section 10 of the Plan.
(p) "SUBSIDIARY" shall mean a "subsidiary corporation," whether now
or hereafter existing, as defined in Section 424(f) of the Code.
3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 10
of the Plan, the maximum aggregate number of Shares which may be optioned and
sold under the Plan is 300,000 Shares of Common Stock. The Shares may be
authorized, but unissued, or reacquired Common Stock.
If an Option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were
subject thereto shall, unless the Plan shall have been terminated, become
available for future grant under the Plan. If Shares which were acquired
upon exercise of an Option are subsequently repurchased by the Company, such
Shares shall not in any event be returned to the Plan and shall not become
available for future grant under the Plan.
4. ADMINISTRATION OF AND GRANTS OF OPTIONS UNDER THE PLAN.
(a) ADMINISTRATOR. Except as otherwise required herein, the Plan
shall be administered by the Board.
(b) PROCEDURE FOR GRANTS. The provisions set forth in this Section
4(b) shall not be amended more than once every six months, other than to
comport with changes in the Code, the Employee Retirement Income Security Act
of 1974, as amended, or the rules thereunder. All grants of Options
hereunder shall be automatic and nondiscretionary and shall be made strictly
in accordance with the following provisions:
(i) No person shall have any discretion to select which Outside
Directors shall be granted Options or to determine the number of Shares to be
covered by Options granted to Outside Directors.
(ii) Each Outside Director shall automatically receive, on the
date of each Annual Meeting of Stockholders at which such Director is
elected, an Option to purchase 10,000 Shares of the Company's Common Stock,
such Option to become exercisable on the date one (1) year subsequent to the
date of grant. If an Outside Director is appointed to the Board to fill a
vacancy after the date of the Annual Meeting of Stockholders (hereafter
referred to as the "Prior Meeting"), such Director shall automatically
receive on the date of such appointment an Option to purchase the number of
Shares of the Company's Common Stock calculated by multiplying 10,000 times a
fraction, the numerator of which is the difference between the number twelve
and the number of full months since the Prior Meeting and the denominator of
which is twelve. Such Option will become exercisable on the later of one
year from the date of the Prior Meeting or six months from the date of grant,
as required under subparagraph (iii) (D) below.
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<PAGE>
(iii) The terms of an Option granted hereunder shall be as
follows:
(A) the term of the Option shall be five (5) years.
(B) the Option shall be exercisable only while the Outside
Director remains a Director of the Company, except as
set forth in Section 8 hereof.
(C) the exercise price per Share shall be 100% of the fair
market value per Share on the date of grant of the
Option.
(D) To the extent necessary to comply with the applicable
provisions of Rule 16b-3 promulgated under the
Exchange Act ("Rule 16b-3"), no Option will be
exercisable until a date more than six months
subsequent to the date of the grant of that Option.
(c) POWERS OF THE BOARD. Subject to the provisions and restrictions
of the Plan, the Board shall have the authority, in its discretion: (i) to
determine, upon review of relevant information and in accordance with Section
7(b) of the Plan, the fair market value of the Common Stock; (ii) to
determine the exercise price per share of Options to be granted, which
exercise price shall be determined in accordance with Section 7(a) of the
Plan; (iii) to interpret the Plan; (iv) to prescribe, amend and rescind rules
and regulations relating to the Plan; (v) to authorize any person to execute
on behalf of the Company any instrument required to effectuate the grant of
an Option previously granted hereunder; and (vi) to make all other
determinations deemed necessary or advisable for the administration of the
Plan.
(d) EFFECT OF BOARD'S DECISION. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees and
any other holders of any Options granted under the Plan.
5. ELIGIBILITY. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth
in Section 4(b) hereof.
The Plan shall not confer upon any Optionee any right with respect
to continuation of service as a Director or nomination to serve as a
Director, nor shall it interfere in any way with any rights which the
Director or the Company may have to terminate his directorship at any time.
6. TERM OF PLAN. The Plan shall become effective upon the earlier of
(i) its adoption by the Board or (ii) its approval by the stockholders of the
Company as described in Section 16 of the Plan. It shall continue in effect
for a term of ten (10) years unless sooner terminated under Section 12 of the
Plan.
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<PAGE>
7. EXERCISE PRICE AND CONSIDERATION.
(a) EXERCISE PRICE. The per Share exercise price for the Shares to
be issued pursuant to exercise of an Option shall be 100% of the fair market
value per Share on the date of grant of the Option.
(b) FAIR MARKET VALUE. The fair market value ("Fair Market Value")
of a Share shall be determined by the Board in its discretion; PROVIDED
however, that where there is a public market for the Common Stock, the fair
market value per Share shall be the closing price of the Common Stock in the
over-the-counter market on the date of grant, as reported in THE WALL STREET
JOURNAL (or, if not so reported, as otherwise reported by the National
Association of Securities Dealers Automated Quotation ("NASDAQ") System) or,
in the event the Common Stock is traded on the NASDAQ National Market or
listed on a stock exchange, the fair market value per Share shall be the
closing price on such system or exchange on the date of grant of the Option,
as reported in THE WALL STREET JOURNAL.
(c) FORM OF CONSIDERATION. Subject to compliance with applicable
provisions of Section 16(b) of the Exchange Act, (or other applicable law),
the consideration to be paid for the Shares to be issued upon exercise of an
Option, including the method of payment, shall be determined by the Board and
may consist entirely of (i) cash, (ii) check, (iii) promissory note, (iv)
other Shares which (X) in the case of Shares acquired upon exercise of an
Option, have been owned by the Optionee for more than six months on the date
of surrender, and (Y) have a Fair Market Value on the date of exercise equal
to the aggregate exercise price of the Shares as to which said Option shall
be exercised, (v) authorization for the Company to retain from the total
number of Shares as to which the Option is exercised that number of Shares
having a Fair Market Value on the date of exercise equal to the exercise
price for the total number of Shares as to which the Option is exercised,
(vi) delivery of a properly executed exercise notice together with
irrevocable instructions to a broker to promptly deliver to the Company the
amount of sale or loan proceeds required to pay the exercise price, (vii) by
delivering an irrevocable subscription agreement for the Shares which
irrevocably obligates the option holder to take and pay for the Shares not
more than twelve months after the date of delivery of the subscription
agreement, (viii) any combination of the foregoing methods of payment or (ix)
such other consideration and method of payment for the issuance of Shares as
may be permitted under applicable laws. In making its determination as to
the type of consideration to accept, the Board shall consider whether
acceptance of such consideration may be reasonably expected to benefit the
Company (Section 153 of the Delaware General Corporation Law).
8. EXERCISE OF OPTION.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A STOCKHOLDER. Any Option
granted hereunder shall be exercisable at such times as are set forth in
Section 4(b) hereof; provided however, that no Options shall be exercisable
until stockholder approval of the Plan in accordance with Section 16 hereof
has been obtained.
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<PAGE>
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Company in accordance with the terms of
the Option by the person entitled to exercise the Option and full payment for
the Shares with respect to which the Option is exercised has been received by
the Company. Full payment may consist of any consideration and method of
payment allowable under Section 7(c) of the Plan. Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. A share certificate for the number of Shares so
acquired shall be issued to the Optionee as soon as practicable after
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 of the Plan.
Exercise of an Option in any manner shall result in a decrease in
the number of Shares which thereafter may be available, both for purposes of
the Plan and for sale under the Option, by the number of Shares as to which
the Option is exercised.
(b) TERMINATION OF STATUS AS A DIRECTOR. If an Outside Director
ceases to serve as a Director, he may, but only within seven (7) months after
the date he ceases to be a Director of the Company, exercise his Option to
the extent that he was entitled to exercise it at the date of such
termination. To the extent that he was not entitled to exercise an Option at
the date of such termination, or if he does not exercise such Option (which
he was entitled to exercise) within the time specified herein, the Option
shall terminate.
(c) DISABILITY OF OPTIONEE. Notwithstanding the provisions of
Section 8(b) above, in the event an Optionee is unable to continue his
service as a Director with the Company as a result of his total and permanent
disability (as defined in Section 22(e)(3) of the Code) he may, but only
within seven (7) months from the date of termination, exercise his Option to
the extent he was entitled to exercise it at the date of such termination.
To the extent that he was not entitled to exercise the Option at the date of
termination, or if he does not exercise such Option (which he was entitled to
exercise) within the time specified herein, the Option shall terminate.
(d) DEATH OF OPTIONEE. Notwithstanding the provisions of Section
8(b) above, in the event of the death of an Optionee:
(i) during the term of the Option who is at the time of his
death a Director of the Company and who has been in Continuous Status as a
Director since the date of grant of the Option, the Option may be exercised,
at any time within seven (7) months following the date of death, by the
Optionee's estate or by a person who acquired the right to exercise the
Option by bequest or inheritance, but only to the extent of the right to
exercise that would have accrued had the Optionee continued living and
remained in Continuous Status as a Director for six (6) months after the date
of death; or
-5-
<PAGE>
(ii) within thirty (30) days after the termination of
Continuous Status as a Director, the Option may be exercised, at any time
within seven (7) months following the date of death, by the Optionee's estate
or by a person who acquired the right to exercise the Option by bequest or
inheritance, but only to the extent of the right to exercise that had accrued
at the date of termination.
9. NON-TRANSFERABILITY OF OPTIONS. The 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, DISSOLUTION OR MERGER.
(a) In the event that the number of outstanding shares of Common
Stock of the Company is changed by a stock dividend, stock split, reverse
stock split, combination, reclassification or similar change in the capital
structure of the Company without consideration, the number of Shares
available under this Plan and the number of Shares subject to outstanding
Options and the exercise price per share of such Options shall be
proportionately adjusted, subject to any required action by the Board or
stockholders of the Company and compliance with applicable securities laws;
PROVIDED however, that no certificate or scrip representing fractional shares
shall be issued upon exercise of any Option and any resulting fractions of a
Share shall be ignored. Such adjustment shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive.
(b) In the event of a dissolution or liquidation of the Company, a
merger in which the Company is not the surviving corporation, a transaction
or series of related transactions in which 100% of the then outstanding
voting stock is sold or otherwise transferred, or the sale of substantially
all of the assets of the Company, any or all outstanding Options shall,
notwithstanding any contrary terms of the written agreement governing such
Option, accelerate and become exercisable in full at least ten days prior to
(and shall expire on) the consummation of such dissolution, liquidation,
merger or sale of stock or sale of assets on such conditions as the Board
shall determine unless the successor corporation assumes the outstanding
Options or substitutes substantially equivalent options.
11. TIME OF GRANTING OPTIONS. The date of grant of an Option shall, for
all purposes, be the date determined in accordance with Section 4(b) hereof.
Notice of the determination shall be given to each Outside Director 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 at any time amend,
alter, suspend, or discontinue the Plan, but no amendment, alteration,
suspension, or discontinuation shall be made which would impair the rights of
any Optionee under any grant theretofore made, without his or her consent.
In addition, to the extent necessary and desirable to comply with Rule 16b-3
under the Exchange Act (or any other applicable law or regulation), the
Company
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<PAGE>
shall obtain shareholder approval of any Plan amendment in such a manner and
to such a degree as required.
(b) EFFECT OF AMENDMENT OR TERMINATION. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee
and the Board, which agreement must be in writing and signed by the Optionee
and the Company.
13. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued
pursuant to the exercise of an Option 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 Exchange Act, the rules and regulations
promulgated thereunder, state securities laws, and the requirements of any
stock exchange upon which the Shares may then be listed, and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
As a condition to the exercise of an Option, the Company may
require the person exercising such Option to represent and warrant at the
time of any such exercise that the Shares are being purchased only for
investment and without any present intention to sell or distribute such
Shares, if, in the opinion of counsel for the Company, such a representation
is required by any of the aforementioned relevant provisions of law.
Inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel
to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue
or sell such Shares as to which such requisite authority shall not have been
obtained.
14. RESERVATION OF SHARES. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall
be sufficient to satisfy the requirements of the Plan.
15. OPTION AGREEMENT. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
16. STOCKHOLDER APPROVAL.
(a) The Plan shall be subject to approval by the stockholders of the
Company within twelve (12) months of its adoption by the Board. If such
stockholder approval is obtained at a duly held stockholders' meeting, it may
be obtained by the affirmative vote of the holders of a majority of the
outstanding shares of the Company present or represented and entitled to vote
thereon. If such stockholder approval is obtained by written consent, it may
be obtained by the written consent of the holders of a majority of the
outstanding shares of the Company.
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<PAGE>
(b) Any required approval of the stockholders of the Company shall
be solicited substantially in accordance with Section 14(a) of the Exchange
Act and the rules and regulations promulgated thereunder.
17. INFORMATION TO OPTIONEES. The Company shall provide to each
Optionee, during the period for which such Optionee has one or more Options
outstanding, copies of all annual reports to stockholders, proxy statements
and other information provided to all stockholders of the Company.
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Exhibit 4.2
INNERDYNE, INC.
1991 EMPLOYEE STOCK PURCHASE PLAN
The following constitute the provisions of the 1991 Employee Stock
Purchase Plan of InnerDyne, Inc.
1. PURPOSE. The purpose of the Plan is to provide employees of the
Company and its Designated Subsidiaries with an opportunity to purchase
Common Stock of the Company through accumulated payroll deductions. It is
the intention of the Company to have the Plan qualify as an "Employee Stock
Purchase Plan" under Section 423 of the Internal Revenue Code of 1986, as
amended. The provisions of the Plan, accordingly, shall be construed so as
to extend and limit participation in a manner consistent with the
requirements of that section of the Code.
2. DEFINITIONS.
(a) "BOARD" shall mean the Board of Directors of the Company.
(b) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
(c) "COMMON STOCK" shall mean the Common Stock of the Company.
(d) "COMPANY" shall mean InnerDyne, Inc., a Delaware corporation.
(e) "COMPENSATION" shall mean all base straight time gross earnings,
payments for overtime, shift premium, incentive compensation, incentive
payments, bonuses, commissions and other compensation.
(f) "DESIGNATED SUBSIDIARIES" shall mean the Subsidiaries which have
been designated by the Board from time to time in its sole discretion as
eligible to participate in the Plan.
(g) "EMPLOYEE" shall mean any individual who is an employee of the
Company for purposes of tax withholding under the Code whose customary
employment with the Company or any Designated Subsidiary is at least twenty
(20) hours per week and more than five (5) months in any calendar year. For
purposes of the Plan, the employment relationship shall be treated as
continuing intact while the individual is on sick leave or other leave of
absence approved by the Company. Where the period of leave exceeds 90 days
and the individual's right to reemployment is not guaranteed either by
statute or by contract, the employment relationship will be deemed to have
terminated on the 91st day of such leave.
(h) "ENROLLMENT DATE" shall mean the first day of each Offering
Period.
(i) "EXERCISE DATE" shall mean the last day of each Offering Period.
<PAGE>
(j) "FAIR MARKET VALUE" shall mean, as of any date, the value of
Common Stock determined as follows:
(1) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
National Market of the National Association of Securities Dealers, Inc.
Automated Quotation ("Nasdaq") System, its Fair Market Value shall be the
closing sale price for the Common Stock (or the mean of the closing bid and
asked prices, if no sales were reported), as quoted on such exchange (or the
exchange with the greatest volume of trading in Common Stock) or system on
the date of such determination, as reported in THE WALL STREET JOURNAL or
such other source as the Board deems reliable, or;
(2) If the Common Stock is quoted on the Nasdaq system (but not
on the National Market thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean of the closing bid and asked prices for the Common Stock on
the date of such determination, as reported in THE WALL STREET JOURNAL or
such other source as the Board deems reliable, or;
(3) In the absence of an established market for the Common Stock,
the Fair Market Value thereof shall be determined in good faith by the Board.
(k) "OFFERING PERIOD" shall mean a period of approximately six (6)
months, commencing on the first Trading Day on or after May 1 of each year
and terminating on the last Trading Day in the period ending the following
October, or commencing on the first Trading Day on or after November 1 of
each year and terminating on the last Trading Day in the period ending the
following April, during which an option granted pursuant to the Plan may be
exercised.
(l) "PLAN" shall mean this 1991 Employee Stock Purchase Plan.
(m) "PURCHASE PRICE" shall mean an amount equal to 85% of the Fair
Market Value of a share of Common Stock on the Enrollment Date or on the
Exercise Date, whichever is lower.
(n) "RESERVES" shall mean the number of shares of Common Stock
covered by each option under the Plan which have not yet been exercised and
the number of shares of Common Stock which have been authorized for issuance
under the Plan but not yet placed under option.
(o) "SUBSIDIARY" shall mean a corporation, domestic or foreign, of
which not less than 50% of the voting shares are held by the Company or a
Subsidiary, whether or not such corporation now exists or is hereafter
organized or acquired by the Company or a Subsidiary.
(p) "TRADING DAY" shall mean a day on which national stock exchanges
and the National Association of Securities Dealers Automated Quotation
(Nasdaq) System are open for trading.
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3. ELIGIBILITY.
(a) Any Employee (as defined in Section 2(g)) employed by the Company
on a given Enrollment Date shall be eligible to participate in the Plan.
(b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately after
the grant, such Employee (or any other person whose stock would be attributed
to such Employee pursuant to Section 424(d) of the Code) would own capital
stock of the Company or hold outstanding options to purchase such stock
possessing five percent (5%) or more of the total combined voting power or
value of all classes of the capital stock of the Company or of any
Subsidiary, or (ii) which permits his or her rights to purchase stock under
all employee stock purchase plans of the Company and its subsidiaries to
accrue at a rate which exceeds Twenty-Five Thousand Dollars ($25,000) worth
of stock (determined at the fair market value of the shares at the time such
option is granted) for each calendar year in which such option is outstanding
at any time.
4. OFFERING PERIODS. The Plan shall be implemented by consecutive
Offering Periods with a new Offering Period commencing on the first Trading
Day on or after May 1 and November 1 of each year, or on such other date as
the Board shall determine, and continuing thereafter until terminated in
accordance with Section 19 hereof. The Board shall have the power to change
the duration of Offering Periods (including the commencement dates thereof)
with respect to future offerings without stockholder approval if such change
is announced at least fifteen (15) days prior to the scheduled beginning of
the first Offering Period to be affected thereafter.
5. PARTICIPATION.
(a) An eligible Employee may become a participant in the Plan by
completing a subscription agreement authorizing payroll deductions in the
form of Exhibit A to this Plan and filing it with the Company's payroll
office at least five (5) business days prior to the applicable Enrollment
Date, unless a later time for filing the subscription agreement is set by the
Board for all eligible Employees with respect to a given Offering Period.
(b) Payroll deductions for a participant shall commence on the first
payroll date following the Enrollment Date and shall end on the last payroll
date in the Offering Period to which such authorization is applicable, unless
sooner terminated by the participant as provided in Section 10 hereof.
6. PAYROLL DEDUCTIONS.
(a) At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay
day during the Offering Period in an amount not exceeding ten percent (10%)
of the Compensation which he or she receives on each pay day during the
Offering Period.
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<PAGE>
(b) All payroll deductions made for a participant shall be credited
to his or her account under the Plan and will be withheld in whole
percentages only. A participant may not make any additional payments into
such account.
(c) A participant may discontinue his or her participation in the
Plan as provided in Section 10 hereof, or may increase or decrease the rate
of his or her payroll deductions during the Offering Period by completing or
filing with the Company a new subscription agreement authorizing a change in
payroll deduction rate. The Board may, in its discretion, limit the number
of participation rate changes during any Offering Period. The change in rate
shall be effective with the first full payroll period following ten (10)
business days after the Company's receipt of the new subscription agreement
unless the Company elects to process a given change in participation more
quickly. A participant's subscription agreement shall remain in effect for
successive Offering Periods unless terminated as provided in Section 10
hereof.
(d) Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and Section 3(b) hereof, a participant's
payroll deductions may be decreased to 0% at such time during any Offering
Period which is scheduled to end during the current calendar year (the
"Current Offering Period") that the aggregate of all payroll deductions which
were previously used to purchase stock under the Plan in a prior Offering
Period which ended during that calendar year plus all payroll deductions
accumulated with respect to the Current Offering Period equal $21,250.
Payroll deductions shall recommence at the rate provided in such
participant's subscription agreement at the beginning of the first Offering
Period which is scheduled to end in the following calendar year, unless
terminated by the participant as provided in Section 10 hereof.
(e) At the time the option is exercised, in whole or in part, or at
the time some or all of the Company's Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company's
federal, state or other tax withholding obligations, if any, which arise upon
the exercise of the option or the disposition of the Common Stock. At any
time, the Company may, but will not be obligated to, withhold from the
participant's compensation the amount necessary for the Company to meet
applicable withholding obligations, including any withholding required to
make available to the Company any tax deductions or benefits attributable to
sale or early disposition of Common Stock by the Employee.
7. GRANT OF OPTION. On the Enrollment Date of each Offering Period,
each eligible Employee participating in such Offering Period shall be granted
an option to purchase on the Exercise Date of such Offering Period (at the
applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated
prior to such Exercise Date and retained in the Participant's account as of
the Exercise Date by the applicable Purchase Price; provided that in no event
shall an Employee be permitted to purchase during each Offering Period more
than a number of Shares determined by dividing $12,500 by the Fair Market
Value of a share of the Company's Common Stock on the Enrollment Date, and
provided further that such purchase shall be subject to the limitations set
forth in Sections 3(b) and 12 hereof. Exercise of the option shall occur as
provided in Section 8
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hereof, unless the participant has withdrawn pursuant to Section 10 hereof,
and shall expire on the last day of the Offering Period.
8. EXERCISE OF OPTION. Unless a participant withdraws from the Plan as
provided in Section 10 hereof, his or her option for the purchase of shares
will be exercised automatically on the Exercise Date, and the maximum number
of full shares subject to option shall be purchased for such participant at
the applicable Purchase Price with the accumulated payroll deductions in his
or her account. No fractional shares will be purchased; any payroll
deductions accumulated in a participant's account which are not sufficient to
purchase a full share shall be retained in the participant's account for the
subsequent Offering Period, subject to earlier withdrawal by the participant
as provided in Section 10 hereof. Any other monies left over in a
participant's account after the Exercise Date shall be returned to the
participant. During a participant's lifetime, a participant's option to
purchase shares hereunder is exercisable only by the participant.
9. DELIVERY. As promptly as practicable after each Exercise Date on
which a purchase of shares occurs, the Company shall arrange the delivery to
each participant, as appropriate, of a certificate representing the shares
purchased upon exercise of his or her option.
10. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) A participant may withdraw all but not less than all the payroll
deductions credited to his or her account and not yet used to exercise his or
her option under the Plan at any time by giving written notice to the Company
in the form of Exhibit B to this Plan. All of the participant's payroll
deductions credited to his or her account will be paid to such participant
promptly after receipt of notice of withdrawal and such participant's option
for the Offering Period will be automatically terminated, and no further
payroll deductions for the purchase of shares will be made during the
Offering Period. If a participant withdraws from an Offering Period, payroll
deductions will not resume at the beginning of the succeeding Offering Period
unless the participant delivers to the Company a new subscription agreement.
(b) Upon a participant's ceasing to be an Employee (as defined in
Section 2(g) hereof), for any reason, including by virtue of him or her
having failed to remain an Employee of the Company for at least twenty (20)
hours per week during an Offering Period in which the Employee is a
participant, he or she will be deemed to have elected to withdraw from the
Plan and the payroll deductions credited to such participant's account during
the Offering Period but not yet used to exercise the option will be returned
to such participant or, in the case of his or her death, to the person or
persons entitled thereto under Section 14 hereof, and such participant's
option will be automatically terminated.
(c) A participant's withdrawal from an Offering Period will not have
any effect upon his or her eligibility to participate in any similar plan
which may hereafter be adopted by the Company or in succeeding Offering
Periods which commence after the termination of the Offering Period from
which the participant withdraws.
11. INTEREST. No interest shall accrue on the payroll deductions of a
participant in the Plan.
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<PAGE>
12. STOCK.
(a) The maximum number of shares of the Company's Common Stock which
shall be made available for sale under the Plan shall be 300,000 shares,
subject to adjustment upon changes in capitalization of the Company as
provided in Section 18 hereof. If on a given Exercise Date the number of
shares with respect to which options are to be exercised exceeds the number
of shares then available under the Plan, the Company shall make a pro rata
allocation of the shares remaining available for purchase in as uniform a
manner as shall be practicable and as it shall determine to be equitable.
(b) The participant will have no interest or voting right in shares
covered by his option until such option has been exercised.
(c) Shares to be delivered to a participant under the Plan will be
registered in the name of the participant or in the name of the participant
and his or her spouse.
13. ADMINISTRATION.
(a) ADMINISTRATIVE BODY. The Plan shall be administered by the Board
or a committee of members of the Board appointed by the Board. The Board or
its committee shall have full and exclusive discretionary authority to
construe, interpret and apply the terms of the Plan, to determine eligibility
and to adjudicate all disputed claims filed under the Plan. Every finding,
decision and determination made by the Board or its committee shall, to the
full extent permitted by law, be final and binding upon all parties. Members
of the Board who are eligible Employees are permitted to participate in the
Plan, provided that:
(1) Members of the Board who are eligible to participate in the
Plan may not vote on any matter affecting the administration of the Plan or
the grant of any option pursuant to the Plan.
(2) If a Committee is established to administer the Plan, no
member of the Board who is eligible to participate in the Plan may be a
member of the Committee.
(b) RULE 16b-3 LIMITATIONS. Notwithstanding the provisions of
Subsection (a) of this Section 13, in the event that Rule 16b-3 promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
or any successor provision ("Rule 16b-3") provides specific requirements for
the administrators of plans of this type, the Plan shall be only administered
by such a body and in such a manner as shall comply with the applicable
requirements of Rule 16b-3. Unless permitted by Rule 16b-3, no discretion
concerning decisions regarding the Plan shall be afforded to any committee or
person that is not "disinterested" as that term is used in Rule 16b-3.
14. DESIGNATION OF BENEFICIARY.
(a) A participant may file a written designation of a beneficiary who
is to receive any shares and cash, if any, from the participant's account
under the Plan in the event of
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<PAGE>
such participant's death subsequent to an Exercise Date on which the option
is exercised but prior to delivery to such participant of such shares or
cash. In addition, a participant may file a written designation of a
beneficiary who is to receive any cash from the participant's account under
the Plan in the event of such participant's death prior to exercise of the
option. If a participant is married and the designated beneficiary is not the
spouse, spousal consent shall be required for such designation to be
effective.
(b) Such designation of beneficiary may be changed by the participant
at any time by written notice. In the event of the death of a participant
and in the absence of a beneficiary validly designated under the Plan who is
living at the time of such participant's death, the Company shall deliver
such shares or cash to the executor or administrator of the estate of the
participant, or if no such executor or administrator has been appointed (to
the knowledge of the Company), the Company, in its discretion, may deliver
such shares or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known
to the Company, then to such other person as the Company may designate.
15. TRANSFERABILITY. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option
or to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 14 hereof) by the participant. Any
such attempt at assignment, transfer, pledge or other disposition shall be
without effect, except that the Company may treat such act as an election to
withdraw funds from an Offering Period in accordance with Section 10 hereof.
16. USE OF FUNDS. All payroll deductions received or held by the Company
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.
17. REPORTS. Individual accounts will be maintained for each participant
in the Plan. Statements of account will be given to participating Employees
at least annually, which statements will set forth the amounts of payroll
deductions, the Purchase Price, the number of shares purchased and the
remaining cash balance, if any.
18. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
(a) CHANGES IN CAPITALIZATION. Subject to any required action by the
stockholders of the Company, the Reserves as well as the price per share of
Common Stock covered by each option under the Plan which has not yet been
exercised shall be proportionately adjusted for any increase or decrease in
the number of issued shares of Common Stock resulting from a stock split,
reverse stock split, stock dividend, combination or reclassification of the
Common Stock, or any other increase or decrease in the number of shares of
Common Stock effected without receipt of consideration by the Company;
PROVIDED however, that conversion of any convertible securities of the
Company shall not be deemed to have been "effected without receipt of
consideration." Such adjustment shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive. Except
as expressly provided herein, no issuance by the Company of shares of stock
of any class, or securities convertible into shares of stock
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<PAGE>
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.
(b) DISSOLUTION OR LIQUIDATION. In the event of the proposed
dissolution or liquidation of the Company, the Offering Period will terminate
immediately prior to the consummation of such proposed action, unless
otherwise provided by the Board.
(c) MERGER OR ASSET SALE. In the event of a proposed sale of all or
substantially all of the assets of the Company, or the merger of the Company
with or into another corporation, each option under the Plan shall be assumed
or an equivalent option shall be substituted by such successor corporation or
a parent or subsidiary of such successor corporation, unless the Board
determines, in the exercise of its sole discretion and in lieu of such
assumption or substitution, to shorten the Offering Period then in progress
by setting a new Exercise Date (the "New Exercise Date"). If the Board
shortens the Offering Period then in progress in lieu of assumption or
substitution in the event of a merger or sale of assets, the Board shall
notify each participant in writing, at least ten (10) business days prior to
the New Exercise Date, that the Exercise Date for his option has been changed
to the New Exercise Date and that his option will be exercised automatically
on the New Exercise Date, unless prior to such date he has withdrawn from the
Offering Period as provided in Section 10 hereof. For purposes of this
paragraph, an option granted under the Plan shall be deemed to be assumed if,
following the sale of assets or merger, the option confers the right to
purchase, for each share of option stock subject to the option immediately
prior to the sale of assets or merger, the consideration (whether stock, cash
or other securities or property) received in the sale of assets or merger by
holders of Common Stock for each share of Common Stock held on the effective
date of the transaction (and if such holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority
of the outstanding shares of Common Stock); PROVIDED however, that if such
consideration received in the sale of assets or merger was not solely common
stock of the successor corporation or its parent (as defined in Section
424(e) of the Code), the Board may, with the consent of the successor
corporation and the participant, provide for the consideration to be received
upon exercise of the option to be solely common stock of the successor
corporation or its parent equal in fair market value to the per share
consideration received by holders of Common Stock in the sale of assets or
merger.
The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the
price per share of Common Stock covered by each outstanding option, in the
event the Company effects one or more reorganizations, recapitalizations,
rights offerings or other increases or reductions of shares of its
outstanding Common Stock, and in the event of the Company being consolidated
with or merged into any other corporation.
19. AMENDMENT OR TERMINATION.
(a) The Board of Directors of the Company may at any time and for any
reason terminate or amend the Plan. Except as provided in Section 18 hereof,
no such termination can affect options previously granted, PROVIDED that an
Offering Period may be terminated
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<PAGE>
by the Board of Directors on any Exercise Date if the Board determines that
the termination of the Plan is in the best interests of the Company and its
stockholders. Except as provided in Section 18 hereof, no amendment may make
any change in any option theretofore granted which adversely affects the
rights of any participant. To the extent necessary to comply with Rule 16b-3
or under Section 423 of the Code (or any successor rule or provision or any
other applicable law or regulation), the Company shall obtain stockholder
approval in such a manner and to such a degree as required.
(b) Without stockholder consent and without regard to whether any
participant rights may be considered to have been "adversely affected," the
Board (or its committee) shall be entitled to change the Offering Periods,
limit the frequency or number of changes in the amount withheld during an
Offering Period, establish the exchange ratio applicable to amounts withheld
in a currency other than U.S. dollars, permit payroll withholding in excess
of the amount designated by a participant in order to adjust for delays or
mistakes in the Company's processing of properly completed withholding
elections, establish reasonable waiting and adjustment periods or accounting
and crediting procedures to ensure that amounts applied toward the purchase
of Common Stock for each participant properly correspond with amounts
withheld from the participant's Compensation, and establish such other
limitations or procedures as the Board (or its committee) finds, in its sole
discretion, advisable and consistent with the Plan.
20. NOTICES. All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the
location, or by the person, designated by the Company for the receipt thereof.
21. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and
regulations promulgated thereunder, and the requirements of any stock
exchange upon which the shares may then be listed, and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any
of the aforementioned applicable provisions of law.
22. TERM OF PLAN. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
stockholders of the Company. It shall continue in effect for a term of ten
(10) years thereafter unless sooner terminated under Section 19 hereof.
23. ADDITIONAL RESTRICTIONS OF RULE 16b-3. The terms and conditions of
options granted hereunder to, and the purchase of shares by, persons subject
to Section 16 of the
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Exchange Act shall comply with the applicable provisions of Rule 16b-3. This
Plan shall be deemed to contain, and such options shall contain, and the
shares issued upon exercise thereof shall be subject to, such additional
conditions and restrictions as may be required by Rule 16b-3 to qualify for
the maximum exemption from Section 16 of the Exchange Act with respect to
Plan transactions.
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EXHIBIT A
INNERDYNE, INC.
1991 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_____ Original Application Enrollment Date: _____________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)
1. __________________________________________________ hereby elects to
participate in the InnerDyne, Inc. 1991 Employee Stock Purchase Plan
(the "Employee Stock Purchase Plan") and subscribes to purchase shares
of the Company's Common Stock in accordance with this Subscription
Agreement and the Employee Stock Purchase Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount
of ___% of my Compensation on each payday during the Offering Period in
accordance with the Employee Stock Purchase Plan. (Please note that no
fractional percentages are permitted.)
3. I understand that said payroll deductions will be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Employee Stock Purchase Plan. I
understand that if I do not withdraw from an Offering Period, any
accumulated payroll deductions will be used to automatically exercise
my option.
4. I have received a copy of the complete "InnerDyne, Inc. 1991 Employee
Stock Purchase Plan." I understand that my participation in the
Employee Stock Purchase Plan is in all respects subject to the terms of
the Plan. I understand that the grant of the option by the Company
under this Subscription Agreement is subject to obtaining stockholder
approval of the Employee Stock Purchase Plan.
5. Shares purchased for me under the Employee Stock Purchase Plan should
be issued in the name(s) of (Employee or Employee and Spouse Only):
_______________________________________________________________________.
6. I understand that if I dispose of any shares received by me pursuant to
the Plan within 2 years after the Enrollment Date (the first day of the
Offering Period during which I purchased such shares), I will be
treated for federal income tax purposes as having received ordinary
income at the time of such disposition in an amount equal to the excess
of the fair market value of the shares at the time such shares were
delivered to me over the price which I paid for the shares. I HEREBY
AGREE TO NOTIFY THE COMPANY IN WRITING WITHIN 30 DAYS AFTER THE DATE OF
ANY DISPOSITION OF MY SHARES AND I WILL MAKE ADEQUATE PROVISION FOR
<PAGE>
FEDERAL, STATE OR OTHER TAX WITHHOLDING OBLIGATIONS, IF ANY, WHICH
ARISE UPON THE DISPOSITION OF THE COMMON STOCK. The Company may, but
will not be obligated to, withhold from my compensation the amount
necessary to meet any applicable withholding obligation including any
withholding necessary to make available to the Company any tax
deductions or benefits attributable to sale or early disposition of
Common Stock by me. If I dispose of such shares at any time after the
expiration of the two-year holding period, I understand that I will be
treated for federal income tax purposes as having received income only
at the time of such disposition, and that such income will be taxed as
ordinary income only to the extent of an amount equal to the lesser of
(1) the excess of the fair market value of the shares at the time of
such disposition over the purchase price which I paid for the shares,
or (2) 15% of the fair market value of the shares on the first day of
the Offering Period in which the shares were purchased. The remainder
of the gain, if any, recognized on such disposition will be taxed as
capital gain.
7. I hereby agree to be bound by the terms of the Employee Stock Purchase
Plan. The effectiveness of this Subscription Agreement is dependent
upon my eligibility to participate in the Employee Stock Purchase Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Employee Stock Purchase Plan:
NAME: (Please print) ______________________________________________________
(First) (Middle) (Last)
__________________________________ ____________________________________
Relationship
____________________________________
(Address)
NAME: (Please print) ______________________________________________________
(First) (Middle) (Last)
__________________________________ ____________________________________
Relationship
____________________________________
(Address)
Employee's Social
Security Number: ____________________________________
Employee's Address: ____________________________________
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____________________________________
____________________________________
I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT
THROUGHOUT SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.
Dated: _____________________________ __________________________________
Signature of Employee
__________________________________
Spouse's Signature (If beneficiary
other than spouse)
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EXHIBIT B
INNERDYNE, INC.
1991 EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
The undersigned participant in the Offering Period of the InnerDyne,
Inc. 1991 Employee Stock Purchase Plan which began on ____________, 19__ (the
"Enrollment Date") hereby notifies the Company that he or she hereby
withdraws from the Offering Period. The undersigned hereby directs the
Company to pay to the undersigned as promptly as practicable all the payroll
deductions credited to his or her account with respect to such Offering
Period. The undersigned understands and agrees that his or her option for
such Offering Period will be automatically terminated. The undersigned
understands further that no further payroll deductions will be made for the
purchase of shares in the current Offering Period and the undersigned shall
be eligible to participate in succeeding Offering Periods only by delivering
to the Company a new Subscription Agreement.
Name and Address of Participant
___________________________________
___________________________________
___________________________________
Signature
___________________________________
Date: _____________________________
<PAGE>
Exhibit 5.1
October 31, 1997
InnerDyne, Inc.
1244 Reamwood Avenue
Sunnyvale, CA 94089
REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by
you with the Securities and Exchange Commission (the "Commission") on or
about October 31, 1997 (the "Registration Statement") in connection with the
registration under the Securities Act of 1933, as amended, of 200,000 shares
of your Common Stock (the "Shares") reserved for issuance under the 1991
Directors' Stock Option Plan and 200,000 Shares reserved for issuance under
the 1991 Employee Stock Purchase Plan (collectively with the 1991 Directors'
Stock Option Plan, the "Plans"). As your legal counsel, we have examined the
proceedings taken and are familiar with the proceedings proposed to be taken
by you in connection with the sale and issuance of the Shares under the Plans.
It is our opinion that, when issued and sold in the manner referred to in
each Plan and pursuant to the respective agreement which accompanies each
grant under a Plan, the Shares will be legally and validly issued, fully paid
and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the use of our name wherever it appears in
the Registration Statement and any amendments to it.
Sincerely,
VENTURE LAW GROUP
A Professional Corporation
