<PAGE>
As filed with the Securities and Exchange Commission on March 10, 1995
Registration No. 33-______________
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
PHOENIX TECHNOLOGIES LTD.
(Exact name of registrant as specified in its charter)
DELAWARE 04-2685985
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
2770 DE LA CRUZ BOULEVARD
SANTA CLARA, CALIFORNIA 95050
(Address of principal executive offices)
1994 EQUITY INCENTIVE PLAN
(Full title of the plan)
SCOTT C. NEELY, ESQ.
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
PHOENIX TECHNOLOGIES LTD.
2770 DE LA CRUZ BOULEVARD
SANTA CLARA, CALIFORNIA 95050
(408) 654-9000
(Name, address and telephone number, including area code,
of agent for service)
COPIES TO:
Laird H. Simons, Esq.
Scott P. Spector, Esq.
Iain Mickle, Esq.
Fenwick & West
Two Palo Alto Square
Palo Alto, California 94306
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Title of Securities Amount Proposed Maximum Proposed Maximum Amount of
to be to be Offering Price Per Aggregate Offering Registration
Registered Registered Share(1) Price (1) Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$0.001 par value (2) 1,255,386 shares $6.375 $8,003,085.75 $2,759.68
- ------------------------------------------------------------------------------------------------------------------------------------
<FN>
(1) Estimated as of March 7, 1995 pursuant to Rule 457 solely for the
purpose of calculating the registration fee.
(2) Associated with the Common Stock are common stock purchase rights
which will not be exercisable or be evidenced separately from the Common Stock
prior to the occurrence of certain events.
</TABLE>
This Registration Statement, including exhibits, consists of 45 sequentially
numbered pages. The Index to Exhibits appears on sequentially numbered page 7.
<PAGE>
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange Commission
(the "Commission") are incorporated herein by reference:
(a) The Registrant's latest annual report filed
pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or the latest prospectus filed
pursuant to Rule 424(b) under the Securities Act
of 1933, as amended (the "Securities Act"), that
contains audited financial statements for the
Registrant's latest fiscal year for which such
statements have been filed.
(b) All other reports filed pursuant to Section
13(a) or 15(d) of the Exchange Act since the end
of the fiscal year covered by the annual report
or the prospectus referred to in (a) above.
(c) The description of the Registrant's Common Stock
contained in the Registrant's registration
statement filed with the Commission under
Section 12 of the Exchange Act, including any
amendment or report filed for the purpose of
updating such description.
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 registered hereby have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part hereof from the
date of the filing of such documents.
The consolidated balance sheets as of September 30, 1994 and
1993, and the consolidated statements of income, shareholders'
equity and cash flows for each of the three years in the period
ended September 30, 1994 incorporated by reference herein and the
related financial statement schedules incorporated by reference
herein have been included herein in reliance on the reports of
Coopers & Lybrand L.L.P., independent accountants, give on the
authority of that firm as experts in accounting and auditing.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
As to named experts, Item 5 is inapplicable. Scott C. Neely,
whose opinion is included as Exhibit 5.1 hereto, is a holder of
options covering significantly less than one percent (1%) of the
outstanding shares of the outstanding Common Stock, $.001 par value
per share of the Registrant.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law grants to
each corporation organized thereunder the power to indemnify its
officers and directors for certain acts. Article TENTH of the
Registrant's Restated Certificate of Incorporation sets forth the
extent to which officers and directors of the Registrant may be
indemnified against any liabilities which they may incur in their
capacities as directors or officers of the Registrant. Article
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TENTH provides, in part, that each person who was or is made a
party or is threatened to be made a party or is involved in any
action, suit or proceeding by reason of the fact that he or she is
or was a director or officer of the Registrant or is or was serving
at the request of the Registrant as a director, officer, employee
or agent of another corporation or enterprise shall be indemnified
and held harmless by the Registrant, to the fullest extent
authorized by the Delaware General Corporation Law, against all
expense, liability and loss (including attorneys' fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to be
paid in settlement) reasonably incurred or suffered by such person
in connection with such proceeding; provided, however, that if the
person seeking indemnification initiated the proceeding in respect
to which he or she is seeking indemnification from the Registrant,
the Registrant shall provide such indemnification only if such
proceeding was authorized by the Registrant's Board of Directors.
The right to indemnification includes the right to be paid expenses
incurred in defending any such proceeding in advance of its final
disposition; provided, however, that if the Delaware General
Corporation Law so requires, the payment of such expenses in
advance of the final disposition of a proceeding shall be made only
upon delivery to the Registrant of an undertaking, by or on behalf
of such director or officer, to repay all amounts so advanced if it
shall ultimately be determined that such director or officer is not
entitled to indemnification.
Article NINTH of the Registrant's Restated Certificate of
Incorporation eliminates the personal liability of the Registrant's
directors to the Registrant or its stockholders for monetary
damages for breach of a director's fiduciary duty, except for
liability: (1) for breach of a director's duty of loyalty to the
Registrant or its stockholders; (2) for acts or omissions not in
good faith or involving intentional misconduct or knowing
violations of law; (3) under Section 174 of the Delaware General
Corporation Law; or (4) for any transaction from which the director
derived an improper personal benefit.
ITEM 8. EXHIBITS.
The exhibits required by Item 601 of Regulation S-K are listed
in the Exhibit Index which follows the signature page for this Form
S-8.
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:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement (or
the most recent post-effective amendment thereof)
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which, individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration Statement;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
Registration Statement or any material change to such information
in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) above do
not apply if the Registration Statement is on Form S-3 or Form S-8,
and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or Section 15(d) of
the Exchange Act that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose 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 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
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 indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions
discussed in Item 6 hereof, 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 the successful defense
of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered hereby, the Registrant will, unless in the opinion
of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each individual and
corporation whose signature appears below constitutes and appoints
Ronald D. Fisher, Robert J. Riopel, Scott C. Neely and each of
them, his true and lawful attorneys-in-fact and agents with full
power of substitution, for him and in his name, place and stead,
in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration
Statement on Form S-8, and to file the same with all exhibits
thereto and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-
in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or his or their substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and
has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Norwood, Commonwealth of Massachusetts, on this
9th day of March, 1995.
PHOENIX TECHNOLOGIES LTD.
By: /s/Ronald D. Fisher
------------------------
Ronald D. Fisher
Chairman and Chief Executive
Officer
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Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
- ------------------------ -------------- -----------
CHIEF EXECUTIVE OFFICER:
/s/Ronald D. Fisher Chairman, Chief March 9, 1995
- -------------------------
Ronald D. Fisher Executive Officer, and
Director
CHIEF FINANCIAL OFFICER:
/s/Robert J. Riopel Vice President, Finance, March 9, 1995
- --------------------------
Robert J. Riopel Chief Financial Officer
and Treasurer
OTHER DIRECTORS:
/s/Charles Federman Director March 9, 1995
- --------------------------
Charles Federman
/s/Lawrence G. Finch Director March 9, 1995
- --------------------------
Lawrence G. Finch
/s/Lance E. Hansche Director March 9, 1995
- --------------------------
Lance E. Hansche
/s/Anthony P. Morris Director March 9, 1995
- ---------------------------
Anthony P. Morris
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<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit Sequentially
Number Description of Exhibit Numbered Page
- ------- ---------------------- -------------
<S> <C> <C>
4.1 Restated Certificate of Incorporation --
of the Registrant (incorporated herein
by reference to Exhibit 3.1 to the
Registrant's Registration Statement
on Form S-1, Registration No. 33-21793
(the "Form S-1"))
4.2 By-laws of the Registrant as amended through
February 6, 1995 9
4.3 Certificate of Correction to the Registrant's --
Restated Certificate of Incorporation (incorporated
herein by reference to Exhibit 3.3 to Amendment
No. 2 to the Form S-1 ("Amendment No. 2"))
4.4 Certificate of Amendment to the Registrant's --
Restated Certificate of Incorporation (incorporated
herein by reference to Exhibit 3.4 to Amendment No. 2)
4.5 Certificate of Correction to the Registrant's --
Restated Certificate of Incorporation (incorporated
herein by reference to Exhibit 3.5 to the Registrant's
Annual Report on Form 10-K for the fiscal
year ended September 30, 1988 (the "1988 Form 10-K"))
4.6 Certificate of Ownership (uncorporated herein by --
reference to Exhibit 3.6 to the 1988 Form 10-K)
4.7 Certificate of Correction to the Registrant's --
Restated Certificate of Incorporation (incorporated
herein by reference to Exhibit 3.7 to the
1988 Form 10-K)
4.8 Rights Agreement dated as of October 31, 1989 --
between the Registrant and The First National Bank
of Boston (incorporated herein by reference to
Exhibit 4.1 to the Registrant's Current Report on
Form 8-K dated October 31, 1989 (the "1989 8-K"))
4.9 Certificate of Designations of the Registrant's --
Series A Junior Participating Preferred Stock
(incorporated herein by reference to Exhibit 4.1 to
the 1989 8-K)
4.10 Registrant's 1994 Equity Incentive Plan as amended
through December 12, 1994 21
</TABLE>
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<TABLE>
<CAPTION>
Exhibit Sequentially
Number Description of Exhibit Numbered Page
- ------- ---------------------- -------------
<S> <C> <C>
4.11 Form of Stock Option Agreement 38
5.1 Opinion of Scott C. Neely 44
23.1 Consent of Scott C. Neely, Esq.
(included in Exhibit 5.1) --
23.2 Consent of Coopers & Lybrand L.L.P., 45
Independent Accountants
24.1 Power of Attorney (see page 5) --
</TABLE>
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<PAGE>
PHOENIX TECHNOLOGIES LTD. EXHIBIT 4.2
BY-LAWS
(as amended through February 6, 1995)
ARTICLE I
MEETING OF STOCKHOLDERS
Section 1. PLACE OF MEETINGS. All meetings of the stockholders shall
be held at such place within or without the State of Delaware as may be fixed
from time to time by the board of directors or the chief executive officer, or
if not so designated, at the registered office of the corporation.
Section 2. ANNUAL MEETING. An annual meeting of stockholders shall be
held at such date, time and place, either within or without the State of
Delaware, as the Board of Directors shall each year fix. At such annual
meeting, the stockholders shall elect by a plurality vote directors to succeed
those whose terms expire and shall transact such other business as may properly
be brought before the meeting.
Section 3. SPECIAL MEETINGS. Special meetings of the stockholders, for
any purpose or purposes, may, unless otherwise prescribed by statute or by the
certificate of incorporation, be called by the board of directors or the chief
executive officer and shall be called by the chief executive officer or
secretary at the request in writing of a majority of the board of directors.
Such request shall state the purposes or purposes of the proposed meeting.
Business transacted at any special meeting shall be limited to matters relating
to the purpose or purposes stated in the notice of meeting.
Section 4. NOTICE OF MEETINGS. Except as otherwise provided by law,
written notice of each meeting of stockholders, annual or special, stating the
place, date and hour of the meeting and, in the case of a special meeting, the
purpose or purposes for which the meeting is called, shall be given not less
than ten or more than sixty days before the date of the meeting, to each
stockholder entitled to vote at such meeting.
Section 5. VOTING LIST. The officer who has charge of the stock ledger
of the corporation shall prepare and make, at least ten days before every
meeting of stockholders, a complete list of the stockholders entitled to vote at
the meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten days prior to the meeting, either at a place within the city or town where
the meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present.
Section 6. QUORUM. the holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all
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meetings of the stockholders for the transaction of business, except as
otherwise provided by statute, the certificate of incorporation or these by-
laws; provided that where a separate vote by a class or classes is required on
any matter the holders of a majority of the issued and outstanding shares of
such class entitled to vote thereon, present in person or represented by proxy,
shall constitute a quorum entitled to take action with respect to that matter.
Section 7. ADJOURNMENTS. Any meeting of stockholders may be adjourned
from time to time to any other time and to any other place at which a meeting of
stockholders may be held under these by-laws, which time and place shall be
announced at the meeting, by a majority of the stockholders present in person or
represented by proxy at the meeting and entitled to vote, though less than a
quorum, or, if no stockholder is present or represented by proxy, by any officer
entitled to preside at or to act as secretary of such meeting, without notice
other than announcement at the meeting, until a quorum shall be present or
represented. At such adjourned meeting at which a quorum shall be present or
represented, any business may be transacted which might have been transacted at
the original meeting. If the adjournment is for more than thirty days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
Section 8. ACTION AT MEETINGS. When a quorum is present at any
meeting, in all matters other than the election of directors the vote of the
holders of a majority of the stock present in person or represented by proxy and
entitled to vote on the question shall decide any question brought before such
meeting, unless the question is one upon which by express provision of law, the
certificate of incorporation or these by-laws, a different vote is required, in
which case such express provision shall govern and control the decision of such
question, and directors shall be elected by the vote of holders of a plurality
of the shares present in person or represented by proxy and entitled to vote on
the election of directors; provided that where a separate vote by class or
classes is required, the vote of the holders of a majority of the shares of such
class or classes present in person or represented by proxy and entitled to vote
on the question shall be the act of such class.
Section 9. VOTING AND PROXIES. Unless otherwise provided in the
certificate of incorporation, each stockholder shall at every meeting of the
stockholders be entitled to one vote for each share of the capital stock having
voting power held of record by such stockholder. Each stockholder entitled to
vote at a meeting of stockholders, or to express consent or dissent to corporate
action in writing without a meeting, may authorize another person or persons to
act for him by proxy, but no such proxy shall be voted or acted upon after three
years from its date, unless the proxy provides for a longer period.
Section 10. ACTION WITHOUT MEETING. Until the consummation of the first
public offering of stock of the corporation pursuant to a registration statement
declared effective under the Securities Act of 1933, as amended, any action
required to be taken at any annual or special meeting of stockholders, or any
action which may be taken at any annual or special meeting of such stockholders,
may be taken without a meeting, without prior notice and without a vote, if a
consent or consents in writing, setting forth the action so taken and bearing
the date of signature of each stockholder who signs the consent, shall be signed
by the holders of outstanding stock having not less than the minimum number of
votes that would be necessary to authorize or take
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such action at a meeting at which all shares entitled to vote thereon were
present and voted and shall be delivered to the corporation by delivery to its
registered office in Delaware, to its principal place of business, or to an
officer or agent of the corporation having custody of the book in which
proceedings of meetings of stockholders are recorded within sixty days of the
earliest dated consent so delivered. Prompt notice of the taking of the
corporate action without a meeting by less than unanimous written consent shall
be given to those stockholders who have not consented in writing.
Section 11. PROCEDURES FOR INTRODUCING BUSINESS AT STOCKHOLDER MEETINGS,
ETC. After the consummation of the first public offering of stock of the
corporation pursuant to a registration statement declared effective under the
Securities Act of 1933, as amended: Except as otherwise provided by law, at any
annual or special meeting of stockholders only such business shall be conducted
as shall have been properly brought before the meeting. In order to be properly
brought before the meeting, such business must have been either (A) specified in
the written notice of the meeting (or any supplement thereto) given to
stockholders of record on the record date for such meeting by or at the
direction of the board of directors or the chief executive officer, (B) brought
before the meeting at the direction of the board of directors or the chairman of
the meeting or (C) specified in a written notice given by or on behalf of a
stockholder or record on the record date for such meeting entitled to vote
thereat or a duly authorized proxy for such stockholder, in accordance with all
of the following requirements. A notice referred to in clause (C) hereof must
be delivered personally to or mailed to and received at the principal executive
office of the corporation, addressed to the attention of the secretary, not more
than ten (10) days after the date of the initial notice referred to in clause
(A) hereof, in the case of business to be brought before a special meeting of
stockholders, and not less than thirty (30) days prior to the first anniversary
date of the initial notice referred to in clause (A) hereof to the previous
year's annual meeting, in the case of business to be brought before an annual
meeting of stockholders, provided, however, that such notice shall not be
required to be given more than fifty (50) days prior to an annual meeting of
stockholders. Such notice referred to in clause (C) hereof shall set forth (i)
a full description of each such item of business proposed to be brought before
the meeting, (ii) the name and address of the person proposing to bring such
business before the meeting, (iii) the class and number of shares held of
record, held beneficially and represented by proxy by such person as of the
record date for the meeting (if such date has then been made publicly available)
and as of the date of such notice, (iv) if any item of such business involves a
nomination for director, all information regarding each such nominee that would
be required to be set forth in a definitive proxy statement filed with the
Securities and Exchange Commission pursuant to Section 14 of the Securities
Exchange Act of 1934, as amended, or any successor thereto, and the written
consent of each such nominee to serve if elected, and (v) all other information
that would be required to be filed with the Securities and Exchange Commission
if, with respect to the business proposed to be brought before the meeting, the
person proposing such business was a participant in a solicitation subject to
Section 14 of the Securities Exchange Act of 1934, as amended, or any successor
thereto. No business shall be brought before any meeting of stockholders of the
corporation otherwise than as provided in this section.
Notwithstanding the foregoing provisions, the board of directors shall not
be obligated to include information as to any nominee for director in any proxy
statement or other communication sent to stockholders.
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The chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that any proposed item of business was not brought before
the meeting in accordance with the foregoing procedure and, if he should so
determine, he shall so declare to the meeting and the defective item of business
shall be disregarded.
In advance of any meeting of stockholders, the board of directors may
appoint judges of election, who need not be stockholders, to act at such meeting
or any adjournment thereof. If judges of election are not so appointed, the
chairman of any such meeting may and, on the request of any stockholder or his
proxy shall, make such appointment at the meeting. The number of judges shall
be one or three as shall be determined by the board of directors, except that,
if appointed at the meeting on the request of one or more stockholders or
proxies, the holders of a majority of the shares of the corporation present and
entitled to vote shall determine whether one or three judges are to be
appointed. No person who is a candidate for office shall act as a judge.
In case any person appointed as a judge fails to appear or fails or refuses
to act, the vacancy may be filled by appointment made by the board of directors
in advance of the convening of the meeting or at the meeting by the officer or
person acting as chairman.
The judges of election shall determine the number of shares outstanding and
the voting power of each, the shares represented at the meeting, the existence
of a quorum, and the authenticity, validity and effect of proxies, receive votes
or ballots, hear and determine all challenges and questions in any way arising
in connection with the right to vote, count and tabulate all votes, determine
the result, and do such other acts as may be proper to conduct the election or
vote with fairness to all stockholders. The judges of election shall perform
their duties impartially, in good faith, to the best of their ability, and as
expeditiously as is practical. If there be three judges of election, the
decision, act or certificate of a majority shall be effective in all respects as
the decision, act or certificate of all.
On request of the chairman of the meeting or of any stockholder or his
proxy, the judges shall make a report in writing of any challenge or question or
matter determined by them, and execute a certificate of any fact found by them.
Any report or certificate made by them shall be prima facie evidence of the
facts stated therein.
ARTICLE II
DIRECTORS
Section 1. RESIGNATION. Any director may resign at any time upon
written notice to the corporation at its principal place of business or to the
chief executive officer or secretary. Such resignation shall be effective upon
receipt unless it is specified to be effective at some other time or upon the
happening of some other event.
Section 2. GENERAL POWERS. The business and affairs of the corporation
shall be managed by its board of directors, which may exercise all powers of the
corporation and do all
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such lawful acts and things as are not by statute or by the certificate of
incorporation or by these by-laws directed or required to be exercised or done
by the stockholders.
Section 3. CHAIRMAN OF THE BOARD. If the board of directors appoints a
chairman of the board, he shall, when present, preside at all meetings of the
stockholders and the board of directors. He shall perform such duties and
possess such powers as are customarily vested in the office of the chairman of
the board or as may be vested in him by the board of directors.
Section 4. PLACE OF MEETINGS. The board of directors may hold
meetings, both regular and special, either within or without the State of
Delaware.
Section 5. REGULAR MEETINGS. Regular meetings of the board of
directors may be held without notice at such time and at such place as shall
from time to time be determined by the board; provided that any director who is
absent when such a determination is made shall be given prompt notice of such
determination. A regular meeting of the board of directors may be held without
notice immediately after and at the same place as the annual meeting of
stockholders.
Section 6. SPECIAL MEETINGS. Special meetings of the board may be
called by the chief executive officer, secretary, or on the written request of
two or more directors, or by one director in the event that there is only one
director in office. Two days' notice to each director, either personally or by
telegram, cable, telecopy, commercial delivery service, telex or similar means
sent to his business or home address, or three days' notice by written notice
deposited in the mail, shall be given to each director by the secretary or by
the officer or one of the directors calling the meeting. A notice or waiver of
notice of a meeting of the board of directors need not specify the purposes of
the meeting.
Section 7. ACTION BY CONSENT. Unless otherwise restricted by the
certificate of incorporation or these by-laws, any action required or permitted
to be taken at any meeting of the board of directors or of any committee thereof
may be taken without a meeting, if all members of the board or committee, as the
case may be, consent thereto in writing, and the writing or writings are filed
with the minutes of proceedings of the board or committee.
Section 8. TELEPHONIC MEETINGS. Unless otherwise restricted by the
certificate of incorporation or these by-laws, members of the board of directors
or of any committee thereof may participate in a meeting of the board of
directors or of any committee, as the case may be, by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and such participation in a
meeting shall constitute presence in persons at the meeting.
Section 9. COMMITTEES. The board of directors may, by resolution
passed by a majority of the whole board, designate one or more committees, each
committee to consist of one or more of the directors of the corporation. The
board may designate one or more directors as alternate members of any committee,
who may replace any absent or disqualified member at any meeting of the
committee. Any such committee, to the extent provided in the resolution of the
board of directors, shall have and may exercise all the powers and authority of
the board of directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers which may require it; but no such committee
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shall have the power or authority in reference to amending the certificate of
incorporation, adopting an agreement of merger or consolidation, recommending to
the stockholders the sale, lease or exchange of all or substantially all of the
corporation's property and assets, recommending to the stockholders a
dissolution of the corporation or a revocation of a dissolution, or amending the
by-laws of the corporation; and, unless the resolution designating such
committee or the certificate of incorporation expressly so provides, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. Such committee or committees shall have such
name or names as may be determined from time to time by resolution adopted by
the board of directors. Each committee shall keep regular minutes of its
meetings and make such reports to the board of directors as the board of
directors may request. Except as the board of directors may otherwise
determine, any committee may make rules for the conduct of its business, but
unless otherwise provided by the directors or in such rules, its business shall
be conducted as nearly as possible in the same manner as is provided in these
by-laws for the conduct of its business by the board of directors.
Section 10. COMPENSATION. Unless otherwise restricted by the
certificate of incorporation or these by-laws, the board of directors shall have
the authority to fix from time to time the compensation of directors. The
directors may be paid their expense, if any, of attendance at each meeting of
the board of directors and the performance of their responsibilities as
directors and may be paid a fixed sum for attendance at each meeting of the
board of directors and/or a stated salary as director. No such payment shall
preclude any director from serving the corporation or its parent or subsidiary
corporations in any other capacity and receiving compensation therefor. The
board of directors may also allow compensation for members of special or
standing committees for service on such committees.
ARTICLE III
OFFICERS
Section 1. ENUMERATION. The officers of the corporation shall be chose
by the board of directors and shall be a president, a secretary and a treasurer
and such other officers with such titles, terms of office and duties as the
board of directors may from time to time determine, including a chairman of the
board, one or more vice-presidents, and one or more assistant secretaries and
assistant treasurers. If authorized by resolution of the board of directors,
the chief executive officer may be empowered to appoint from time to time
assistant secretaries and assistant treasurers. Any number of offices may be
held by the same person, unless the certificate of incorporation or these by-
laws otherwise provide.
Section 2. ELECTION. The board of directors at its first meeting after
each annual meeting of stockholders shall choose a president, a secretary and a
treasurer. Other officers may be appointed by the board of directors at such
meeting, at any other meeting, or by written consent.
Section 3. TENURE. The officers of the corporation shall hold office
until their successors are chose and qualify, unless a different term is
specified in the vote choosing or appointing him, or until his earlier death,
resignation or removal. Any officer elected or
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appointed by the board of directors or by the chief executive officer may be
removed at any time by the affirmative vote of a majority of the board of
directors or a committee duly authorized to do so, except that any officer
appointed by the chief executive officer may also be removed at any time by the
chief executive officer. Any vacancy occurring in any office of the corporation
may be filled by the board of directors, at its discretion. any officer may
resign by delivering his written resignation to the corporation at its principal
place of business or to the chief executive officer or the secretary. Such
resignation shall be effective upon receipt unless it is specified to be
effective at some other time or upon the happening of some other event.
Section 4. PRESIDENT. The president shall be the chief operating
officer of the corporation. He shall also be the chief executive officer unless
the board of directors otherwise provides. The president shall, unless the
board of directors provides otherwise in a specific instance or generally,
preside at all meetings of the stockholders and the board of directors, have
general and active management of the business of the corporation and see that
all orders and resolutions of the board of directors are carried into effect.
The president shall execute bonds, mortgages, and other contracts requiring a
seal, under the seal of the corporation, except where required or permitted by
law to be otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the board of directors to some
other officer or agent of the corporation.
Section 5. VICE PRESIDENTS. In the absence of the president or in the
event of his inability or refusal to act, the vice president, or if there be
more than one vice president, the vice presidents in the order designated by the
board of directors or the chief executive officer (or in the absence o f any
designation, then in the order determined by their tenure in office) shall
perform the duties of the president, and when so acting, shall have all the
powers of and be subject to all the restrictions upon the president. The vice
presidents shall perform such other duties and have such other powers as the
board of directors or the chief executive officer may from time to time
prescribe.
Suction 6. SECRETARY. The secretary shall have such powers and perform
such duties as are incident to the office of secretary. He shall maintain a
stock ledger and prepare lists of stockholders and their addresses as required
and shall be the custodian of corporate records. The secretary shall attend all
meetings of the board of directors and all meetings of the stockholders and
record all the proceedings of the meetings of the corporation and of the board
of directors in a book to be kept for that purpose and shall perform like duties
for the standing committees when required. He shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the board of
directors, and shall perform such other duties as may be from time to time
prescribed by the board of directors or chief executive officer, under whose
supervision he shall be. He shall have custody of the corporate seal of the
corporation and he, or an assistant secretary, shall have authority to affix the
same to any instrument requiring it and when so affixed, it may be attested by
his signature or by the signature or such assistant secretary. The board of
directors may give general authority to any other officer to affix the seal of
the corporation and to attest the affixing by his signature.
Section 7. ASSISTANT SECRETARIES. The assistant secretary, or if there
be more than one, the assistant secretaries in the order determined by the board
of directors, the chief executive officer or the secretary (or if there be no
such determination, then in the order determined by
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their tenure in office), shall, in the absence of the secretary or in the event
of his inability or refusal to act, perform the duties and exercise the powers
of the secretary and shall perform such other duties and have such other powers
as the board of directors, the chief executive officer or the secretary may from
time to time prescribe. In the absence of the secretary or any assistant
secretary at any meeting of stockholders or directors, the person presiding at
the meeting shall designate a temporary or acting secretary to keep a record of
the meeting.
Section 8. TREASURER. The treasurer shall perform such duties and
shall have such powers as may be assigned to him by the board of directors or
the chief executive officer. In addition, the treasurer shall perform such
duties and have such powers as are incident to the office of treasurer. The
treasurer shall have the custody of the corporate funds and securities and shall
keep full and accurate accounts of receipts and disbursements in books belonging
to the corporation and shall deposit all moneys and other valuable effects in
the name and to the credit of the corporation in such depositories as may be
designated by the board of directors. He shall disburse the funds of the
corporation as may be ordered by the board of directors, taking proper vouchers
for such disbursements, and shall render to the chief executive officer and the
board of directors, when the chief executive officer or board of directors so
requires, an account of all his transactions as treasurer and of the financial
condition of the corporation.
Section 9. ASSISTANT TREASURERS. The assistant treasurer, or if there
be more than one, the assistant treasurers in the order determined by the board
of directors, the chief executive officer or the treasurer (or if there be no
such determination, then in the order determined by their tenure in office),
shall, in the absence of the treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the treasurer and
shall perform such other duties and have such other powers as the board of
directors, the chief executive officer or the treasurer may from time to time
prescribe.
Section 10. BOND. If required by the board of directors, any officer
shall give the corporation a bond in such sum and with such surety or sureties
and upon such terms and conditions as shall be satisfactory to the board of
directors, including without limitation a bond for the faithful performance of
the duties of his office and for the restoration to the corporation of all
books, papers, vouchers, money and other property of whatever kind in his
possession or under his control and belong to the corporation.
ARTICLE IV
NOTICES
Section 1. DELIVERY. Whenever, under the provisions of law, or of the
certificate of incorporation or these by-laws, written notice is required to be
given to any director or stockholder, such notice may be given by mail,
addressed to such director or stockholder, at his address as it appears on the
records of the corporation, with postage thereon prepaid, and such notice shall
be deemed to be given at the time when the same shall be deposited in the United
States mail. Unless written notice is required by law, written notice may also
be given by telegram, cable, telecopy, commercial delivery service, telex or
similar means, addressed to such director of stockholder at his address as it
appears on the records of the corporation, in which
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case such notice shall be deemed to be given when delivered into the control of
the persons charged with effecting such transmission, the transmission charge to
be paid by the corporation or the person sending such notice and not by the
addressee. Oral notice or other in-hand delivery (in person or by telephone)
shall be deemed given at the time it is actually given.
Section 2. WAIVER OF NOTICE. Whenever any notice is required to be
given under the provisions of law or of the certificate of incorporation or of
these by-laws, a waiver thereof in writing, signed by the person or persons
entitled to said notice, whether before or after the time stated therein, shall
be deemed equivalent thereto.
ARTICLE V
CAPITAL STOCK
Section 1. CERTIFICATES OF STOCK. Every holder of stock in the
corporation shall be entitled to have a certificate, signed by, or in the name
of the corporation by, the chairman or vice-chairman of the board of directors,
or the president or a vice president, and the treasurer or an assistant
treasurer, or the secretary or an assistant secretary of the corporation,
certifying the number of shares owned by him in the corporation. Any or all of
the signatures on the certificate may be a facsimile. In case any officer,
transfer agent or registrar who has signed or whose facsimile signature has been
placed upon a certificate shall have ceased to be such officer, it may be issued
by the corporation with the same effect as if he were such officer, transfer
agent or registrar at the date of issue. Certificates may be issued for partly
paid shares, and in such case upon the face or back of the certificates issued
to represent any such partly paid shares, the total amount of the consideration
to be paid therefor and the amount paid thereon shall be specified.
Section 2. LOST CERTIFICATES. The board of directors may direct a new
certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have been lost,
stolen or destroyed. When authorizing such issue of a new certificate or
certificates, the board of directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, stolen or
destroyed certificate or certificates, or his legal representative, to give
reasonable evidence of such loss, theft or destruction, to advertise the same in
such manner as it shall require and/or to give the corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against the
corporation with respect to the certificate alleged to have been lost, stolen or
destroyed or the issuance of such new certificate.
Section 3. TRANSFER OF STOCK. Upon surrender to the corporation or the
transfer agent of the corporation of a certificate for shares, duly endorsed or
accompanied by proper evidence of succession, assignment or authority to
transfer, and proper evidence of compliance with other conditions to rightful
transfer, it shall be the duty of the corporation to issue a new certificate to
the person entitled thereto, cancel the old certificate and record the
transaction upon its books.
Section 4. RECORD DATE. In order that the corporation may determine
the stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, the board of directors may fix a record date, which
shall not precede the date upon which the
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resolution fixing the record date is adopted by the board of directors and which
record date shall not be more than sixty days nor less than ten days before the
date of such meeting. A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall apply to any adjournment
of the meeting; provided, however, that the board of directors may fix a new
record date for the adjourned meeting. If no record date is fixed, the record
date for determining stockholders entitled to notice of or to vote at a meeting
of stockholders shall be at the close of business on the day before the day on
which notice is given, or, if notice is waived, at the close of business on the
day before the day on which the meeting is held. In order that the corporation
may determine the stockholders entitled to consent to corporate action in
writing without a meeting, the board of directors may fix a record date, which
record date shall not precede the date upon which the resolution fixing the
record date is adopted by the board of directors and which record date shall not
be more than ten days after the date upon which the resolution fixing the record
date is adopted by the board of directors. If no record date is fixed, the
record date for determining stockholders entitled to consent to corporate action
in writing without a meeting, when no prior action by the board of directors is
required, shall be the first date on which a signed written consent setting
forth the action taken or proposed to be taken is delivered to the corporation
by delivery to its registered office in Delaware, to its principal place of
business, or to an officer or agent of the corporation having custody of the
book in which proceedings of meetings of stockholders are recorded. If no
record date is fixed and prior action by the board of directors is required, the
record date for determining stockholders entitled to consent to corporate action
in writing without a meeting shall be at the close of business on the day on
which the board of directors adopts the resolution taking such prior action. In
order that the corporation may determine the stockholders entitled to receive
payment of any dividend or other distribution or allotment of any rights or the
stockholders entitled to exercise any rights in respect of any change,
conversion or exchange of stock, or for the purpose of any other lawful action,
the board of directors may fix a record date, which record date shall not
precede the date on which the resolution fixing the record date is adopted and
which record date shall not be more than sixty days prior to such action. If no
record date is fixed, the record date for determining stockholders for any such
purpose shall be at the close of business on the day on which the board of
directors adopts the resolution relating thereto.
Section 5. REGISTERED STOCKHOLDERS. The corporation shall be entitled
to recognize the exclusive right of a person registered on its books as the
owner of shares to receive dividends, and to vote as such owner, and to hold
liable for calls and assessments a person registered on its books as the owner
of shares, and shall not be bound to recognize any equitable or other claim to
or interest in such share or shares on the part of any other person, whether or
not it shall have express or other notice thereof, except as otherwise provided
by the laws of Delaware.
ARTICLE VI
CERTAIN TRANSACTIONS
Section 1. TRANSACTIONS WITH INTERESTED PARTIES. No contract or
transaction between the corporation and one or more of its directors or
officers, or between the corporation and any other corporation, partnership,
association, or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interests, shall be void
or
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voidable solely for this reason, or solely because the director or officer is
present at or participates in the meeting of the board or committee thereof
which authorizes the contract or transaction or solely because his or their
votes are counted for such purpose, if:
(a) The material facts as to his relationship or interest
and as to the contract or transaction are disclosed or are known to
the board of directors or the committee, and the board or committee in
good faith authorizes the contract or transaction by the affirmative
votes of a majority of the disinterested directors, even through the
disinterested directors be less than a quorum; or
(b) The material facts as to his relationship or interest
and as to the contract or transaction are disclosed or are known to
the stockholders entitled to vote thereon, and the contract or
transaction is specifically approved in good faith by vote of the
stockholders; or
(c) The contract or transaction is fair as to the
corporation as of the time it is authorized approved or ratified by
the board of directors, a committee thereof, or the stockholders.
Section 2. QUORUM. Common or interested directors may be counted in
determining the present of a quorum at a meeting of the board of directors or of
a committee which authorizes the contract or transaction.
ARTICLE VII
GENERAL PROVISIONS
Section 1. DIVIDENDS. Dividends upon the capital stock of the
corporation, if any, may be declared by the board of directors at any regular or
special meeting or by written consent, pursuant to law. Dividends may be paid in
cash, in property, or in shares of the capital stock, subject to the provisions
of the certificate of incorporation.
Section 2. RESERVES. The directors may set apart out of any funds of
the corporation available for dividends a reserve or reserves for any proper
purpose and may abolish any such reserve.
Section 3. CHECKS. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers or such other person or
persons as the board of directors may from time to time designate.
Section 4. FISCAL YEAR. The fiscal year of the corporation shall be
fixed by resolution of the board of directors.
Section 5. SEAL. The board of directors may, by resolution, adopt a
corporate seal. The corporate seal shall have inscribed thereon the name of the
corporation, the year of its organization and the word "Delaware". The seal may
be used by causing it or a facsimile thereof
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to be impressed or affixed or reproduced or otherwise. The seal may be altered
from time to time by the board of directors.
ARTICLE VIII
AMENDMENTS
These by-laws may be altered, amended or repealed or new by-laws may be
adopted by the stockholders or by the board of directors, when such power is
conferred upon the board of directors by the certificate of incorporation, at
any regular meeting of the stockholders or of the board of directors or at any
special meeting of the stockholders or of the board of directors, provided,
however, that in the case of a regular or special meeting of stockholders,
notice of such alteration, amendment,. repeal or adoption of new by-law be
contained in the notice of such meeting.
* * *
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PHOENIX TECHNOLOGIES LTD. EXHIBIT 4.10
1994 EQUITY INCENTIVE PLAN
As Amended Through December 12, 1994
1. PURPOSE
The purpose of the Plan is to provide incentives to attract,
retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company and its
Parent, Subsidiaries and Affiliates, by offering them an opportunity
to participate in the Company's future performance through awards of
Options, Restricted Stock and Stock Bonuses. Capitalized terms not
defined in the text are defined in Section 24.
2. SHARES SUBJECT TO THE PLAN
2.1 NUMBER OF SHARES AVAILABLE. Subject to Sections 2.2 and 18, the total
number of Shares reserved and available for grant and issuance pursuant to
the Plan shall be 1,000,000 shares, plus the total number of shares
authorized for issuance, but not issued or subject to outstanding options,
under the Company's existing option plans as of November 30, 1994;
provided, however, that the maximum number of Shares that may be issued
under the Plan to members of the Board of Directors of the Company who are
not also employees of the Company is 200,000 Shares. Subject to Sections
2.2 and 18, Shares shall again be available for grant and issuance in
connection with future Awards under the Plan that: (a) are subject to
issuance upon exercise of an Option but cease to be subject to such Option
for any reason other than exercise of such Option, (b) are subject to an
Award that otherwise terminates without such Shares being issued and for
which the participant did not receive any benefits of ownership (other than
voting rights), or (c) become available for issuance under any other equity
plans of the Company pursuant to the terms of such plans.
2.2 ADJUSTMENT OF SHARES. In the event that the number of outstanding shares
of the Company's Common Stock is changed by a stock dividend,
recapitalization, stock split, reverse stock split, subdivision,
combination, reclassification or similar change in the capital structure of
the Company without consideration, then (a) the number of Shares reserved
for issuance under the Plan, (b) the Exercise Prices of and number of
Shares subject to outstanding Options, and (c) the number of Shares subject
to other outstanding Awards shall be proportionately adjusted, subject to
any required action by the Board or the stockholders of the Company and
compliance with applicable securities laws; provided, however, that
fractions of a Share shall not be issued but shall either be paid in cash
at Fair Market Value or shall be rounded up to the nearest Share, as
determined by the Committee; and provided, further, that the Exercise Price
of any Option may not be decreased to below the par value of the Shares.
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3. ELIGIBILITY
3.1 ELIGIBILITY OF EMPLOYEES, CONSULTANTS AND INDEPENDENT CONTRACTORS. ISOs
(as defined in Section 5 below) may be granted only to employees (including
officers and directors who are also employees) of the Company or of a
Parent or Subsidiary of the Company. All other Awards may be granted to
employees, officers, consultants, independent contractors and advisers of
the Company or any Parent, Subsidiary or Affiliate of the Company;
provided, however, that such consultants, contractors and advisers render
bona fide services not in connection with the offer and sale of securities
in a capital-raising transaction. A person may be granted more than one
Award under the Plan. Each person is eligible to receive up to an
aggregate maximum of 400,000 Shares over the term of the Plan.
3.2 ELIGIBILITY OF DIRECTORS. Each director who is not an employee shall be
granted an Option to purchase 10,000 Shares upon such director's initial
election to the Board of Directors. Upon the anniversary of such initial
election, each director shall receive an Option to purchase an additional
7,000 Shares of stock. Options granted to directors who are not employees
shall be NQSOs. Notwithstanding the foregoing, directors who are not
employees are eligible to receive only Options under the Plan. This
Section 3.2 and Sections 5.3 and 5.4 (concerning director options) may not
be amended more than once every six months, other than to conform with
changes required by law.
4. ADMINISTRATION
4.1 COMMITTEE AUTHORITY. The Plan shall be administered by the Committee or
the Board acting as the Committee. Subject to the general purposes, terms
and conditions of the Plan, and to the direction of the Board, the
Committee shall have full power to implement and carry out the Plan.
Except as otherwise provided pursuant to Sections 3.2 or 5, the Committee
shall have the authority to:
(a) construe and interpret the Plan, any Award Agreement and any other
agreement or document executed pursuant to the Plan;
(b) prescribe, amend and rescind rules and regulations relating to the
Plan;
(c) select persons to receive Awards;
(d) determine the form and terms of Awards;
(e) determine the number of Shares or other consideration subject to
Awards;
(f) determine whether Awards will be granted singly, in combination or
in tandem with, in replacement of, or as alternatives to, other
Awards under the Plan or any other incentive or compensation plan
of the Company or any Parent, Subsidiary or Affiliate of the
Company;
(g) grant waivers of Plan or Award conditions;
(h) determine the vesting, exercisability and payment of Awards;
(i) correct any defect, supply any omission, or reconcile any
inconsistency in the Plan, any Award or any Award Agreement;
(j) determine whether an Award has been earned; and
(k) make all other determinations necessary or advisable for the
administration of the Plan.
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4.2 COMMITTEE DISCRETION. Any determination made by the Committee with respect
to any Award shall be made in its sole discretion at the time of grant of
the Award or, unless in contravention of any express term of the Plan or
Award, at any later time, and such determination shall be final and binding
on the Company and all persons having an interest in any Award under the
Plan. The Committee may delegate to one or more officers of the Company
the authority to grant Awards under the Plan to Participants who are not
Insiders of the Company.
4.3 EXCHANGE ACT REQUIREMENTS. If two or more members of the Board are
Outside Directors, the Committee shall be comprised of at least two
members of the Board, all of whom are Outside Directors and
Disinterested Persons. The Company will take appropriate steps to
comply with the disinterested director requirements of Section 16(b) of
the Exchange Act, including but not limited to, the appointment by the
Board of a Committee consisting of not less than two persons (who are
members of the Board), each of whom is a Disinterested Person. It is
the intent of the Company that the Plan and Awards hereunder satisfy and
be interpreted in a manner, that, in the case of Participants who are or
may be Insiders, satisfies the applicable requirements of Rule 16b-3 (or
its successor) of the Exchange Act. If any provision of the Plan or of
any Award would otherwise conflict with the intent expressed in this
Section 4.3, that provision to the extent possible shall be interpreted
and deemed amended so as to avoid such conflict.
5. OPTIONS
Except as otherwise provided in this Section 5, the Committee may grant
Options to eligible persons and shall determine whether such Options shall
be Incentive Stock Options within the meaning of the Code ("ISOs") or
Nonqualified Stock Options ("NQSOs"), the number of Shares subject to the
Option, the Exercise Price of the Option, the period during which the
Option may be exercised, and all other terms and conditions of the Option,
subject to the following:
5.1 FORM OF OPTION GRANT. Each Option granted under the Plan shall be
evidenced by an Award Agreement which shall expressly identify the
Option as an ISO or NQSO ("Stock Option Agreement"), and be in such form
and contain such provisions (which need not be the same for each
Participant receiving an Award pursuant to Section 3.1) as the Committee
shall from time to time approve, and which shall comply with and be
subject to the terms and conditions of the Plan.
5.2 DATE OF GRANT. The date of grant of an Option shall be the date on which
the Committee makes the determination to grant such Option, unless
otherwise specified by the Committee; provided, however, that Options
granted to directors who are not employees shall be granted on the date
specified in Section 3.2. The Stock Option Agreement and a copy of the
Plan will be delivered to the Participant within a reasonable time after
the granting of the Option.
5.3 EXERCISE PERIOD. Options shall be exercisable within the times or upon the
events determined by the Committee as set forth in the Stock Option
Agreement; provided,
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however, that no Option shall be exercisable after the expiration of ten
(10) years from the date the Option is granted; and provided further that
no ISO granted to a person who directly or by attribution owns 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 ("Ten
Percent Stockholder") shall be exercisable after the expiration of five (5)
years from the date the Option is granted; and provided further that
Options held by directors who are not employees will be exercisable as
follows: (i) with respect to the first Option granted, it will become
exercisable on a cumulative basis as to one-quarter of the Shares subject
to the Option on the first anniversary of the grant date and as to the
balance of the Shares subject to the Option in 12 equal quarterly
installments every three months after such first anniversary; and (ii) with
respect to any Option subsequently granted, it will become exercisable on a
cumulative basis as to one-sixteenth of the Shares subject to the Option,
on a quarterly basis, commencing three months after the date of grant of
such Option. Except as otherwise specifically set forth in the preceding
sentence with respect to directors who are not employees, the Committee may
provide for Options to become exercisable at any time or from time to time,
periodically or otherwise, in such number or percentage as the Committee
determines.
5.4 EXERCISE PRICE. The Exercise Price shall be determined by the Committee
when the Option is granted and may be not less than 85% of the Fair Market
Value of the Shares on the date of grant; provided, however, that (i) the
Exercise Price of an ISO shall be not less than 100% of the Fair Market
Value of the Shares on the date of grant and (ii) the Exercise Price of any
ISO granted to a Ten Percent Stockholder shall not be less than 110% of the
Fair Market Value of the Shares on the date of grant; and provided further,
that the Exercise Price of Options granted to directors who are not
employees shall be 100% of the Fair Market Value of the Shares on the date
of grant. Payment for the Shares purchased may be made in accordance with
Section 8 of the Plan.
5.5 METHOD OF EXERCISE. Options may be exercised only by delivery to the
Company of a written stock option exercise agreement (the "Exercise
Agreement") in a form approved by the Committee (which need not be the same
for each Participant receiving an Award pursuant to the Plan), stating the
number of Shares being purchased, the restrictions imposed on the Shares,
if any, and such representations and agreements regarding Participant's
investment intent, access to information and other matters, if any, as may
be required or desirable by the Company to comply with applicable
securities laws, together with payment in full of the Exercise Price for
the number of Shares being purchased.
5.6 TERMINATION. Notwithstanding the exercise periods set forth in the Stock
Option Agreement, exercise of an Option shall always be subject to the
following:
(a) If the Participant is Terminated for any reason except death or
Disability, then Participant may exercise such Participant's Options,
only to the extent that such Options would have been exercisable upon
the Termination Date, no later than ninety (90) days after the
Termination Date, but in any event, no later than the expiration date
of the Options.
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(b) If the Participant is terminated because of death or Disability,
then Participant's Options may be exercised, only to the extent
that such Options would have been exercisable by Participant on the
Termination Date, and must be exercised by Participant (or
Participant's legal representative or authorized assignee) no later
than one hundred eighty (180) days after the Termination Date, but
in any event no later than the expiration date of the Options.
5.7 LIMITATIONS ON EXERCISE. The Committee may specify a reasonable minimum
number of Shares that may be purchased on any exercise of an Option,
provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.
5.8 LIMITATIONS ON ISOS. The aggregate Fair Market Value (determined as of the
date of grant) of Shares with respect to which ISOs are exercisable for the
first time by a Participant during any calendar year (under the Plan or
under any other incentive stock option plan of the Company or any
Affiliate, Parent or Subsidiary of the Company) shall not exceed $100,000.
If the Fair Market Value of Shares on the date of grant with respect to
which ISOs are exercisable for the first time by a Participant during any
calendar year exceeds $100,000, the Options for the first $100,000 worth of
Shares to become exercisable in such calendar year shall be ISOs and the
Options for the amount in excess of $100,000 that become exercisable in
that calendar year shall be NQSOs. In the event that the Code or the
regulations promulgated thereunder are amended after the Effective Date of
the Plan to provide for a different limit on the Fair Market Value of
Shares permitted to be subject to ISOs, such different limit shall be
automatically incorporated herein and shall apply to any Options granted
after the effective date of such amendment.
5.9 MODIFICATION, EXTENSION OR RENEWAL. The Committee may modify, extend or
renew outstanding Options and authorize the grant of new Options in
substitution therefor, provided that any such action may not, without the
written consent of a Participant, impair any of such Participant's rights
under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered shall be treated in accordance with
Section 424(h) of the Code. The Committee may reduce the Exercise Price of
outstanding Options without the consent of Participants affected by a
written notice to them; provided, however, that the Exercise Price may not
be reduced below the minimum Exercise Price that would be permitted under
Section 5.4 of the Plan for Options granted on the date the action is taken
to reduce the Exercise Price; provided, further, that the Exercise Price
shall not be reduced below the par value of the Shares.
5.10 NO DISQUALIFICATION. Notwithstanding any other provision in the Plan, no
term of the Plan relating to ISOs shall be interpreted, amended or altered,
nor shall any discretion or authority granted under the Plan be exercised,
so as to disqualify the Plan under Section 422 of the Code or, without the
consent of the Participant affected, to disqualify any ISO under Section
422 of the Code.
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6. RESTRICTED STOCK
A Restricted Stock Award is an offer by the Company to sell to an eligible
person Shares that are subject to restrictions. The Committee shall
determine to whom an offer will be made, the number of Shares the person
may purchase, the price to be paid (the "Purchase Price"), the restrictions
to which the Shares shall be subject, and all other terms and conditions of
the Restricted Stock Award, subject to the following:
6.1 FORM OF RESTRICTED STOCK AWARD. All purchases under a Restricted Stock
Award made pursuant to the Plan shall be evidenced by an Award Agreement
("Restricted Stock Purchase Agreement") that shall be in such form (which
need not be the same for each Participant) as the Committee shall from time
to time approve, and shall comply with and be subject to the terms and
conditions of the Plan. The offer of Restricted Stock shall be accepted by
the Participant's execution and delivery of the Restricted Stock Purchase
Agreement and full payment for the Shares to the Company within thirty (30)
days from the date the Restricted Stock Purchase Agreement is delivered to
the Participant. If such Participant does not execute and deliver the
Restricted Stock Purchase Agreement along with full payment for the Shares
to the Company within thirty (30) days, then the offer shall terminate,
unless otherwise determined by the Committee.
6.2 PURCHASE PRICE. The Purchase Price of Shares sold pursuant to a Restricted
Stock Award shall be determined by the Committee and shall be at least 85%
of the Fair Market Value of the Shares on the date the Restricted Stock
Award is granted. Payment of the Purchase Price may be made in accordance
with Section 8 of the Plan.
6.3 TERMS OF RESTRICTED STOCK AWARDS. Restricted Stock Awards shall be subject
to such restrictions as the Committee may impose. These restrictions may
be based upon completion of a specified number of years of service with the
Company or upon completion of the performance goals as set out in advance
in the Participant's Restricted Stock Purchase Agreement. Restricted Stock
Awards may vary from Participant to Participant and between groups of
Participants. Prior to the grant of a Restricted Stock Award, the
Committee shall: (a) determine the nature, length and starting date of any
Performance Period for the Restricted Stock Award; (b) select from among
the Performance Factors to be used to measure performance goals, if any;
and (c) determine the number of Shares that may be awarded to the
Participant. Prior to the payment of any Restricted Stock Award, the
Committee shall determine the extent to which such Restricted Stock Award
has been earned. Performance Periods may overlap and Participants may
participate simultaneously with respect to Restricted Stock Awards that are
subject to different Performance Periods and having different performance
goals and other criteria; PROVIDED, HOWEVER that the maximum Restricted
Stock Award for each Participant with respect to any Performance Period
shall be thirty percent (30%) of the Shares reserved for issuance under
this Plan.
7. STOCK BONUSES
7.1 AWARDS OF STOCK BONUSES. A Stock Bonus is an award of Shares (which may
consist of Restricted Stock) in consideration for services rendered by the
Participant to the
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Company or any Parent, Subsidiary or Affiliate of the Company. A Stock
Bonus may be awarded for past services already rendered to the Company, or
any Parent, Subsidiary or Affiliate of the Company pursuant to an Award
Agreement (the "Stock Bonus Agreement") that shall be in such form (which
need not be the same for each Participant) as the Committee shall from time
to time approve, and shall comply with and be subject to the terms and
conditions of the Plan. A Stock Bonus may be awarded upon satisfaction of
such performance goals as are set out in advance in each Participant's
individual Award Agreement (the "Performance Stock Bonus Agreement") and
shall be in such form (which need not be the same for each Participant) as
the Committee shall from time to time approve, and shall comply with and be
subject to the terms and conditions of the Plan. Stock Bonuses may vary
from Participant to Participant and between groups of Participants, and may
be based upon the achievement of Company, Parent, Subsidiary, Affiliate
and/or individual performance factors or upon such other criteria as the
Committee may determine.
7.2 TERMS OF STOCK BONUSES. Stock Bonus Awards shall be subject to such
restrictions as the Committee shall impose. These restrictions may be
based upon completion of a specified number of years of service with the
Company or upon completion of the performance goals as set out in advance
in the Participant's individual Stock Bonus Agreement. Stock Bonuses may
vary from Participant to Participant and between groups of Participants.
Prior to the grant of a Stock Bonus, the Committee shall: (a) determine the
nature, length and starting date of any Performance Period for the Stock
Bonus; (b) select from among the Performance Factors to be used to measure
performance goals; and (c) determine the number of Shares that may be
awarded to the Participant. Prior to the payment of any Stock Bonus, the
Committee shall determine the extent to which such Stock Bonus has been
earned. Performance Periods may overlap and Participants may participate
simultaneously with respect to Stock Bonuses that are subject to different
Performance Periods and having different performance goals and other
criteria; PROVIDED, HOWEVER that the maximum Stock Bonus for each
Participant with respect to any Performance Period shall be thirty percent
(30%) of the Shares reserved for issuance under this Plan.
7.3 FORM OF PAYMENT. The earned portion of a Stock Bonus shall be paid by the
Company currently. Payment may be made in the form of cash, whole Shares,
including Restricted Stock, or a combination thereof, either in a lump sum
payment or in installments, all as the Committee shall determine, and to
the extent applicable, shall be subject to such conditions or restrictions
as may be required to qualify for the maximum exemption from Section 16 of
the Exchange Act.
7.4 TERMINATION DURING PERFORMANCE PERIOD. If a Participant is Terminated
during a Performance Period for any reason, then such Participant shall be
entitled to payment (whether in Shares, cash or otherwise) with respect to
the Stock Bonus only to the extent earned as of the date of Termination in
accordance with the Performance Stock Bonus Agreement, unless the Committee
shall determine otherwise.
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8. PAYMENT FOR SHARE PURCHASES
8.1 PAYMENT. Payment for Shares purchased pursuant to the Plan may be made in
cash (by check) or, where expressly approved by the Committee and permitted
by law by:
(a) cancellation of indebtedness of the Company to the Participant;
(b) by surrender of shares of the Company's Common Stock that either:
(1) have been owned by Participant for more than six (6) months and
have been paid for within the meaning of SEC Rule 144 (and, if such
shares were purchased from the Company by use of a promissory note,
such note has been fully paid with respect to such shares); or (2)
were obtained by Participant in the public market;
(c) by tender of a full recourse promissory note having such terms as
may be approved by the Committee bearing interest at a rate
sufficient to avoid imputation of income under Sections 483 and
1274 of the Code, provided, however, that Participants who are not
employees of the Company shall not be entitled to purchase Shares
with a promissory note unless the note is adequately secured by
collateral other than the Shares; and provided, further, that the
portion of the Purchase Price equal to the par value of the shares
must be paid in cash.
(d) by waiver of compensation due or accrued to Participant for
services rendered;
(e) by tender of property;
(f) with respect only to purchases upon exercise of an Option, and
provided that a public market for the Company's stock exists:
(1) through a "same day sale" commitment from the Participant and
a broker-dealer that is a member of the National Association
of Securities Dealers (an "NASD Dealer") whereby the
Participant irrevocably elects to exercise the Option and to
sell a portion of the Shares so purchased in order to pay the
Exercise Price, and whereby the NASD Dealer irrevocably
commits upon receipt of such Shares to forward the Exercise
Price directly to the Company; or
(2) through a "margin" commitment from the Participant and an NASD
Dealer whereby the Participant irrevocably elects to exercise
the Option and to pledge the Shares so purchased to the NASD
Dealer in a margin account as security for a loan from the
NASD Dealer in the amount of the Exercise Price, and whereby
the NASD Dealer irrevocably commits upon receipt of such
Shares to forward the Exercise Price directly to the Company;
or
(g) by any combination of the foregoing.
Notwithstanding the foregoing, the Exercise Price of an Option held by a
director who is not an employee shall be paid in cash or pursuant to
subsection (f) of this Section 8.1.
9. WITHHOLDING TAXES
9.1 WITHHOLDING GENERALLY. Whenever Shares are to be issued in satisfaction of
Awards granted under the Plan, the Company may require the Participant to
remit to the Company an amount sufficient to satisfy federal, state and
local withholding tax requirements prior to the delivery of any certificate
or certificates for such Shares. Whenever, under the Plan, payments in
satisfaction of Awards are to be made in cash, such payment shall be
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net of an amount sufficient to satisfy federal, state, and local
withholding tax requirements.
9.2 STOCK WITHHOLDING. When, under applicable tax laws, a Participant incurs
tax liability in connection with the exercise or vesting of any Award that
is subject to tax withholding and the Participant is obligated to pay the
Company the amount required to be withheld, the Participant (other than a
Participant receiving an Award under Section 3.2) may satisfy the minimum
withholding tax obligation by electing to have the Company withhold from
the Shares to be issued that number of Shares having a Fair Market Value
equal to the minimum amount required to be withheld, determined on the date
that the amount of tax to be withheld is to be determined (the "Tax Date").
All elections by a Participant to have Shares withheld for this purpose
shall be made in writing in a form acceptable to the Committee and shall be
subject to the following restrictions:
(a) the election must be made on or prior to the applicable Tax Date;
(b) once made, the election shall be irrevocable as to the particular
Shares as to which the election is made, except as provided in
paragraph (d) below;
(c) all elections shall be subject to the consent or disapproval of the
Committee;
(d) if the Participant is an Insider and if the Company is subject to
Section 16(b) of the Exchange Act: (1) the election may not be made
within six (6) months of the date of grant of the Award, except as
otherwise permitted by SEC Rule 16b-3(e) under the Exchange Act,
and (2) either (A) the election to use stock withholding must be
irrevocably made at least six (6) months prior to the Tax Date
(although such election may be revoked at any time at least six (6)
months prior to the Tax Date) or (B) the exercise of the Option or
election to use stock withholding must be made in the ten (10) day
period beginning on the third day following the release of the
Company's quarterly or annual summary statement of sales or
earnings; and
(e) in the event that the Tax Date is deferred until six (6) months
after the delivery of Shares under Section 83(b) of the Code, the
Participant shall receive the full number of Shares with respect to
which the exercise occurs, but such Participant shall be
unconditionally obligated to tender back to the Company the proper
number of Shares on the Tax Date.
10. PRIVILEGES OF STOCK OWNERSHIP
10.1 VOTING AND DIVIDENDS. No Participant shall have any of the rights of a
stockholder with respect to any Shares until the Shares are issued to the
Participant. After Shares are issued to the Participant, the Participant
shall be a stockholder and have all the rights of a stockholder with
respect to such Shares, including the right to vote and receive all
dividends or other distributions made or paid with respect to such Shares;
provided, however, that if such Shares are Restricted Stock, then any new,
additional or different securities that the Participant may become entitled
to receive with respect to such Shares by virtue of a stock dividend, stock
split or any other change in the corporate or capital structure of the
Company shall be subject to the same restrictions as the Restricted Stock;
provided further, that the Participant shall have no right to retain such
dividends or distributions with respect to Shares that are repurchased
pursuant to Section 12.
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10.2 FINANCIAL STATEMENTS. The Company shall provide financial statements to
each Participant annually during the period such Participant has Awards
outstanding; provided, however, that the Company shall not be required to
provide such financial statements to Participants whose services in
connection with the Company assure them access to equivalent information.
11. TRANSFERABILITY
Awards granted under the Plan, and any interest therein, shall not be
transferable or assignable by Participant, and may not be made subject to
execution, attachment or similar process, otherwise than by will or by the
laws of descent and distribution or as consistent with the specific Plan
and Award Agreement provisions relating thereto. During the lifetime of
the Participant an Award shall be exercisable only by the Participant, and
any elections with respect to an Award, may be made only by the
Participant.
12. RESTRICTIONS ON SHARES
At the discretion of the Committee, the Company may reserve to itself
and/or its assignee(s) in the Award Agreement a right to repurchase a
portion of or all Shares held by a Participant following such Participant's
Termination at any time within ninety (90) days after the later of
Participant's Termination Date and the date Participant purchases Shares
under the Plan, for cash or cancellation of purchase money indebtedness,
with respect to Shares that are not "Vested" (as defined in the Award
Agreement), at the Participant's original Purchase Price.
13. CERTIFICATES
All certificates for Shares or other securities delivered under the Plan
shall be subject to such stock transfer orders, legends and other
restrictions as the Committee may deem necessary or advisable, including
restrictions under any applicable federal, state or foreign securities law,
or any rules, regulations and other requirements of the SEC or any stock
exchange or automated quotation system upon which the Shares may be listed.
14. ESCROW; PLEDGE OF SHARES
To enforce any restrictions on a Participant's Shares, the Committee may
require the Participant to deposit all certificates representing Shares,
together with stock powers or other instruments of transfer approved by the
Committee, appropriately endorsed in blank, with the Company or an agent
designated by the Company to hold in escrow until such restrictions have
lapsed or terminated, and the Committee may cause a legend or legends
referencing such restrictions to be placed on the certificates. Any
Participant who is permitted to execute a promissory note as partial or
full consideration for the purchase of Shares under the Plan shall be
required to pledge and deposit with the Company all or part of the Shares
so purchased as collateral to secure the payment of Participant's
obligation to the Company under the promissory note; provided, however,
that the Committee may require or accept other or additional forms of
collateral to secure
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the payment of such obligation and, in any event, the Company shall have
full recourse against the Participant under the promissory note
notwithstanding any pledge of the Participant's Shares or other collateral.
In connection with any pledge of the Shares, Participant shall be required
to execute and deliver a written pledge agreement in such form as the
Committee shall from time to time approve. The Shares purchased with the
promissory note may be released from the pledge on a prorata basis as the
promissory note is paid.
15. EXCHANGE AND BUYOUT OF AWARDS
The Committee may, at any time or from time to time, authorize the
Company, with the consent of the respective Participants, to issue new
Awards in exchange for the surrender and cancellation of any or all
outstanding Awards (other than Awards granted to directors pursuant to
Section 3.2). The Committee may at any time buy from a Participant an
Award previously granted with payment in cash, Shares (including
Restricted Stock) or other consideration, based on such terms and
conditions as the Committee and the Participant shall agree.
16. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE
An Award shall not be effective unless such Award is in compliance with all
applicable federal and state securities laws, rules and regulations of any
governmental body, and the requirements of any stock exchange or automated
quotation system upon which the Shares may then be listed, as they are in
effect on the date of grant of the Award and also on the date of exercise
or other issuance. Notwithstanding any other provision in the Plan, the
Company shall have no obligation to issue or deliver certificates for
Shares under the Plan prior to (a) obtaining any approvals from
governmental agencies that the Company determines are necessary or
advisable, and/or (b) completion of any registration or other qualification
of such Shares under any state or federal law or ruling of any governmental
body that the Company determines to be necessary or advisable. The Company
shall be under no obligation to register the Shares with the SEC or to
effect compliance with the registration, qualification or listing
requirements of any state securities laws, stock exchange or automated
quotation system, and the Company shall have no liability for any inability
or failure to do so.
17. NO OBLIGATION TO EMPLOY
Nothing in the Plan or any Award granted under the Plan shall confer or be
deemed to confer on any Participant any right to continue in the employ of,
or to continue any other relationship with, the Company or any Parent,
Subsidiary or Affiliate of the Company or limit in any way the right of the
Company or any Parent, Subsidiary or Affiliate of the Company to terminate
Participant's employment or other relationship at any time, with or without
cause.
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18. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE
18.1 PROVISIONS APPLICABLE TO ALL AWARDS. The existence of
outstanding Awards shall not affect in any way the right or power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's
capital structure or its business, or any merger or consolidation of the
Company, or any issue of bonds, debentures, preferred or prior preference
stock ahead of or affecting the Common Stock or the rights thereof, or the
dissolution or liquidation of the Company, or any other corporate act or
proceeding, whether of a similar character or otherwise.
If the Company shall effect a subdivision or consolidation of shares or
other capital readjustment, the payment of a stock dividend, or other
increase or reduction of the number of shares of its Common Stock
outstanding, without receiving compensation therefor in money, services or
property, then (i) the number, class, and per share price of Shares subject
to outstanding Awards hereunder shall be appropriately adjusted in such a
manner as to entitle a Participant to receive upon exercise thereof (and,
if relevant, for the same aggregate cash consideration), the same total
number and class of shares as such Participant would have received had such
Participant exercised such Award in full immediately prior to such event;
and (ii) the number and class of shares with respect to which Awards may be
granted under the Plan shall be adjusted by substituting for the total
number of shares of Common Stock then reserved that number and class of
shares of stock that would have been received by the owner of an equal
number of outstanding shares of Common Stock as the result of the event
requiring the adjustment (a similar adjustment shall be made to the numbers
of Shares specified in Section 3.2 of the Plan). For purposes of this
Section 18, the "exercise" of an Award shall mean: (a) with respect to an
Option, the exercise of such Option; (b) with respect to a Restricted Stock
Award, payment for the Shares by the Participant; and (c) with respect to a
Stock Bonus Award the occurrence of events entitling the Participant to
receive Shares under such Award.
After a merger of one or more corporations into the Company, or after a
consolidation of the Company and one or more corporations in which the
Company shall be the surviving corporation, each holder of an outstanding
Award shall, at no additional cost, be entitled to receive upon exercise of
such Award (subject to any required action by stockholders of the Company)
in lieu of the number of Shares as to which such Award shall then be so
exercisable, the number and class of shares of stock or other securities to
which such holder would have been entitled pursuant to the terms of the
agreement of merger or consolidation if, immediately prior to such merger
or consolidation, such holder had been the holder of record of a number of
shares of Common Stock equal to the number of shares as to which such Award
shall be so exercised.
If the Company is merged into or consolidated with another corporation
under circumstances where the Company is not the surviving corporation, or
if the Company is liquidated, or sells or otherwise disposes of
substantially all its assets to another corporation while unexercised
Awards remain outstanding under the Plan, (i) subject to the provisions of
clause (ii) below, after the effective date of such merger, consolidation
or sale, as the case may be, each holder of an outstanding Award shall be
entitled to
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receive upon exercise of such Award, in lieu of shares of Common Stock,
shares of such stock or other securities, cash or property as the holders
of shares of Common Stock received pursuant to the terms of the merger,
consolidation or sale; or (ii) all outstanding Awards may be canceled by
the Board as of the effective date of any such merger, consolidation,
liquidation or sale provided that (x) notice of such cancellation shall be
given to each holder of an Award and (y) each holder of an Award shall have
the right to exercise such Award to the extent that the same is then
exercisable or, if the Board shall have accelerated the time for exercise
of all unexercised and unexpired Awards, in full during the 30-day period
preceding the effective date of such merger, consolidation, liquidation or
sale.
Except as expressly provided above, the issue by the Company of shares of
stock of any class, securities convertible into shares of stock of any
class, for cash, property or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of Shares then subject to
outstanding Awards.
18.2 PROVISIONS APPLICABLE TO DIRECTOR OPTIONS. Notwithstanding any other
provision to the contrary in Section 18.1 or any other section of this
Plan, in the event of a Change of Control (as defined below), all Options
granted to directors who are not employees pursuant to Section 3.2 and
outstanding as of the date such Change in Control occurs shall become
exercisable in full, whether or not exercisable in accordance with their
terms. A "Change in Control" shall occur or be deemed to have occurred
only if any of the following events occur: (i) any "person." as such term
is used in Section 13(d) and 14(d) of the Exchange Act (other than the
Company, any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, or any corporation owned directly or
indirectly by stockholders of the Company in substantially the same
proportion as their ownership of stock of the Company) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 50% or
more of the combined voting power of the Company's then outstanding
securities; (ii) individuals who, as of June 1, 1994, constitute the Board
of Directors of the Company (as of the date thereof, the "Incumbent Board")
cease for any reason to constitute at least a majority of the Board,
provided that any person becoming a director subsequent to the date thereof
whose election, or nomination for election by the Company's stockholders,
was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board (other than an election or nomination of an
individual whose" initial assumption of office is in connection with an
actual or threatened election contest relating to the election of the
directors of the Company, as such terms are used in Rule 14a-11 of
Regulation 14A under the Exchange Act) shall be, for purposes of this
Agreement, considered as though such person were a member of the Incumbent
Board; (iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (A) a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 80% of the
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combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation
or (B) a merger or consolidation effected to implement a recapitalization
of the Company (or similar transaction) in which no "person" (as
hereinabove defined) acquires more than 30% of the combined voting power of
the Company's then outstanding securities; or (iv) the stockholders of the
Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or
substantially all of the Company's assets.
19. ADOPTION AND STOCKHOLDER APPROVAL
The Plan shall become effective on the date that it is adopted by the Board
(the "Effective Date"). The Company may submit the Plan for approval by
the stockholders of the Company at the next annual meeting of stockholders
of the Company to obtain the advantages under NASD, IRS, Securities and
Exchange Commission and other regulations that approval of stockholders may
bestow; however, options granted under the Plan shall not be affected if
stockholders do not approve the Plan.
20. TERM OF PLAN
The Plan will terminate ten (l0) years from the Effective Date.
21. AMENDMENT OR TERMINATION OF PLAN
The Board may at any time terminate or amend the Plan in any respect,
including without limitation amendment of any form of Award Agreement or
instrument to be executed pursuant to the Plan; provided, however, that the
Board shall not, without the approval of the stockholders of the Company,
amend the Plan in any manner that requires such stockholder approval
pursuant to the Code or the regulations promulgated thereunder as such
provisions apply to ISO plans or pursuant to the Exchange Act or Rule 16b-3
(or its successor), as amended, thereunder.
22. NONEXCLUSIVITY OF THE PLAN
Neither the adoption of the Plan by the Board, the submission of the Plan
to the stockholders of the Company for approval, nor any provision of the
Plan shall be construed as creating any limitations on the power of the
Board to adopt such additional compensation arrangements as it may deem
desirable, including, without limitation, the granting of stock options and
bonuses otherwise than under the Plan, and such arrangements may be either
generally applicable or applicable only in specific cases.
23. GOVERNING LAW
The Plan and all agreements, documents and instruments entered into
pursuant to the Plan shall be governed by and construed in accordance with
the internal laws of the Commonwealth of Massachusetts, excluding that body
of law pertaining to conflict of laws.
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24. DEFINITIONS
As used in the Plan, the following terms shall have the following meanings:
"AFFILIATE" means any corporation that directly, or indirectly through one
or more intermediaries, controls or is controlled by, or is under common
control with, another corporation, where "control" (including the terms
"controlled by" and "under common control with" means the possession,
direct or indirect, of the power to cause the direction of the management
and policies of the corporation, whether through the ownership of voting
securities, by contract or otherwise.
"AWARD" means any award under the Plan, including any Option, Restricted
Stock or Stock Bonus.
"AWARD AGREEMENT" means, with respect to each Award, the signed written
agreement between the Company and the Participant setting forth the terms
and conditions of the Award.
"BOARD" means the Board of Directors of the Company.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMITTEE" means the committee appointed by the Board to administer the
Plan, or if no committee is appointed, the Board.
"COMPANY" means Phoenix Technologies Ltd., a corporation organized under
the laws of the State of Delaware, or any successor corporation.
"DISABILITY" means a disability, whether temporary or permanent, partial or
total, within the meaning of Section 22(e)(3) of the Code, as determined by
the Committee.
"DISINTERESTED PERSON" means a director who has not, during the period that
person is a member of the Committee and for one year prior to service as a
member of the Committee, been granted or awarded equity securities pursuant
to the Plan or any other plan of the Company or any Parent, Subsidiary or
Affiliate of the Company, except in accordance with the requirements set
forth in Rule 16b-3(c)(2)(i) (and any successor regulation thereto) as
promulgated by the SEC under Section 16(b) of the Exchange Act, as such
rule is amended from time to time and as interpreted by the SEC.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXERCISE PRICE" means the price at which a holder of an Option may
purchase the Shares issuable upon exercise of the Option.
"FAIR MARKET VALUE" means, as of any date, the value of a share of the
Company's Common Stock determined as follows:
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(a) if such Common Stock is then quoted on the Nasdaq National Market System,
its last reported sale price on the Nasdaq National Market or, if no such
reported sale takes place on such date, the average of the closing bid and asked
prices;
(b) if such Common Stock is publicly traded and is then listed on a national
securities exchange, the last reported sale price or, if no such reported sale
takes place on such date, the average of the closing bid and asked prices on the
principal national securities exchange on which the Common Stock is listed or
admitted to trading;
(c) if such Common Stock is publicly traded but is not quoted on the Nasdaq
National Market nor listed or admitted to trading on a national securities
exchange, the average of the closing bid and asked prices on such date, as
reported by The Wall Street Journal, for the over-the-counter market; or
(d) if none of the foregoing is applicable, by the Board of Directors of the
Company in good faith.
"INSIDER" means an officer or director of the Company or any other person whose
transactions in the Company's Common Stock are subject to Section l6 of the
Exchange Act.
"OPTION" means an award of an option to purchase Shares pursuant to Section 5.
"OUTSIDE DIRECTOR" means any outside director as defined in Section 162(m) of
the Code and the regulations issued thereunder.
"PARENT" means any corporation (other than the Company) in an unbroken chain of
corporations ending with the Company, if at the time of the granting of an Award
under the Plan, each of such corporations other than the Company owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.
"PARTICIPANT" means a person who receives an Award under the Plan.
"PERFORMANCE FACTORS" means the factors selected by the Committee from among the
following measures to determine whether the performance goals established by the
Committee and applicable to Awards have been satisfied:
(a) Net revenue and/or net revenue growth;
(b) Earnings before income taxes and amortization and/or earnings
before income taxes and amortization growth;
(c) Operating income and/or operating income growth;
(d) Net income and/or net income growth;
(e) Earnings per share and/or earnings per share growth;
(f) Total shareholder return and/or total shareholder return growth;
(g) Return on equity;
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(h) Operating cash flow return on income;
(i) Adjusted operating cash flow return on income;
(j) Economic value added; and
(k) Individual confidential business objectives.
"PERFORMANCE PERIOD" means the period of service determined by the Committee,
not to exceed five years, during which years of service or performance is to be
measured for Restricted Stock Awards or Stock Bonuses.
"PLAN" means this Phoenix Technologies Ltd. 1994 Equity Incentive Plan, as
amended from time to time.
"RESTRICTED STOCK AWARD" means an award of Shares pursuant to Section 6.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SHARES" means shares of the Company's Common Stock, $0.001 par value, reserved
for issuance under the Plan, as adjusted pursuant to Sections 2 and 18, and any
security issued in respect thereto or in replacement therefor.
"STOCK BONUS" means an award of Shares, or cash in lieu of Shares, pursuant to
Section 7.
"SUBSIDIARY" means any corporation (other than the Company) in an unbroken chain
of corporations beginning with the Company if, at the time of granting of the
Award, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in such chain.
"TERMINATION" or "TERMINATED" means, for purposes of the Plan with respect to a
Participant, that the Participant has ceased to provide services as an employee,
director, consultant, independent contractor or adviser, to the Company or a
Parent, Subsidiary or Affiliate of the Company, except in the case of sick
leave, military leave, or any other leave of absence approved by the Committee,
provided, that such leave is for a period of not more than ninety (90) days, or
reinstatement upon the expiration of such leave is guaranteed by contract or
statute. The Committee shall have sole discretion to determine whether a
Participant has ceased to provide services and the effective date on which the
Participant ceased to provide services (the "Termination Date").
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EXHIBIT 4.11
PHOENIX TECHNOLOGIES LTD.
1994 EQUITY INCENTIVE PLAN
STOCK OPTION AGREEMENT
This Stock Option Agreement ("AGREEMENT") is made and entered into as of
the date of grant set forth below (the "DATE OF GRANT") by and between Phoenix
Technologies Ltd., a Delaware corporation (the "COMPANY"), and the participant
named below ("PARTICIPANT"). Capitalized terms not defined herein shall have
the meaning ascribed to them in the Company's 1994 Equity Incentive Plan (the
"PLAN").
PARTICIPANT: ----------------------------------
SOCIAL SECURITY NUMBER: ----------------------------------
ADDRESS: ----------------------------------
-----------------------------------
TOTAL OPTION SHARES: -----------------------------------
EXERCISE PRICE PER SHARE: ----------------------------------
DATE OF GRANT: ----------------------------------
FIRST VESTING DATE: ----------------------------------
EXPIRATION DATE: ----------------------------------
TYPE OF STOCK OPTION:
(Check one): [ ] INCENTIVE STOCK OPTION
[ ] NONQUALIFIED STOCK OPTION
1. GRANT OF OPTION. The Company hereby grants to Participant an option
(the "OPTION") to purchase the total number of shares of Common Stock $0.001 par
value, of the Company set forth above (the "SHARES") at the Exercise Price Per
Share set forth above (the "EXERCISE PRICE"), subject to all of the terms and
conditions of this Agreement and the Plan. If designated as an Incentive Stock
Option above, the Option is intended to qualify as an "incentive stock option"
("ISO") within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "CODE"), provided that if, by August 9, 1995, the Company has
not obtained approval of the Plan from its stockholders (as required by Section
422 of the Code), this option shall not be an ISO.
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2. EXERCISE PERIOD.
2.1 VESTING SCHEDULE. Provided Participant continues to provide
services to the Company or any Subsidiary, Parent or Affiliate of the Company
throughout the specified period, the Option shall become exercisable as to
portions of the Shares as follows:
DATE NUMBER OF SHARES
---- ----------------
PRIOR TO 0 SHARES
QUARTERLY BEGINNING AN ADDITIONAL TH
PER QUARTER FOR QUARTERS OF THE TOTAL SHARES
2.2 EXPIRATION. The Option shall expire on the Expiration Date set
forth above and must be exercised, if at all, on or before the Expiration Date.
3. TERMINATION.
3.1 TERMINATION FOR ANY REASON EXCEPT DEATH OR DISABILITY. If
Participant is Terminated for any reason, except death or Disability, the
Option, to the extent (and only to the extent) that it would have been
exercisable by Participant on the date of Termination, may be exercised by
Participant no later than ninety (90) days after the date of Termination, but in
any event no later than the Expiration Date.
3.2 TERMINATION BECAUSE OF DEATH OR DISABILITY. If Participant is
Terminated because of death or Disability of Participant, the Option, to the
extent that it is exercisable by Participant on the date of Termination, may be
exercised by Participant (or Participant's legal representative) no later than
one hundred and eighty (180) days after the date of Termination, but in any
event no later than the Expiration Date.
3.3 NO OBLIGATION TO EMPLOY. Nothing in the Plan or this Agreement
shall confer on Participant any right to continue in the employ of, or other
relationship with, the Company or any Parent, Subsidiary or Affiliate of the
Company, or limit in any way the right of the Company or any Parent, Subsidiary
or Affiliate of the Company to terminate Participant's employment or other
relationship at any time, with or without cause.
4. MANNER OF EXERCISE.
4.1 STOCK OPTION EXERCISE AGREEMENT. To exercise this Option,
Participant (or in the case of exercise after Participant's death, Participant's
executor, administrator, heir or legatee, as the case may be) must deliver to
the Company an executed stock option exercise agreement in the form attached
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hereto as EXHIBIT A, or in such other form as may be approved by the Company
from time to time (the "EXERCISE AGREEMENT"), which shall set forth, INTER ALIA,
Participant's election to exercise the Option, the number of Shares being
purchased, any restrictions imposed on the Shares and any representations,
warranties and agreements regarding Participant's investment intent and access
to information as may be required by the Company to comply with applicable
securities laws. If someone other than Participant exercises the Option, then
such person must submit documentation reasonably acceptable to the Company that
such person has the right to exercise the Option.
4.2 LIMITATIONS ON EXERCISE. The Option may not be exercised unless
such exercise is in compliance with all applicable federal and state securities
laws, as they are in effect on the date of exercise. The Option may not be
exercised as to fewer than 100 Shares unless it is exercised as to all Shares as
to which the Option is then exercisable.
4.3 PAYMENT. The Exercise Agreement shall be accompanied by full
payment of the Exercise Price for the Shares being purchased in cash (by check),
or where permitted by law:
(a) by cancellation of indebtedness of the Company to the Participant;
(b) by surrender of shares of the Company's Common Stock that either:
(1) have been owned by Participant for more than six (6) months and
have been paid for within the meaning of SEC Rule 144 and, if such
shares were purchased from the Company by use of a promissory note,
such note has been fully paid with respect to such shares); or (2)
were obtained by Participant in the open public market; and (3) are
clear of all liens, claims, encumbrances or security interests;
(c) by waiver of compensation due or accrued to Participant for
services rendered;
(d) provided that a public market for the Company's stock exists, (1)
through a "same day sale" commitment from Participant and a
broker-dealer that is a member of the National Association of
Securities Dealers (an "NASD DEALER") whereby Participant
irrevocably elects to exercise the Option and to sell a portion
of the Shares so purchased to pay for the exercise price and
whereby the NASD Dealer irrevocably commits upon receipt of such
Shares to forward the exercise price directly to the Company, OR
(2) through a "margin" commitment from Participant and an NASD
Dealer whereby Participant irrevocably elects to exercise the
Option and to pledge the Shares so purchased to the NASD Dealer
in a margin account as security for a loan from the NASD Dealer
in the amount of the exercise price, and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward the
exercise price directly to the Company; or
(e) by any combination of the foregoing.
4.4 TAX WITHHOLDING. Prior to the issuance of the Shares upon
exercise of the Option, Participant must pay or provide for any applicable
federal or state withholding obligations of the Company. If the
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Committee permits, Participant may provide for payment of withholding taxes upon
exercise of the Option by requesting that the Company retain Shares with a Fair
Market Value equal to the minimum amount of taxes required to be withheld. In
such case, the Company shall issue the net number of Shares to the Participant
by deducting the Shares retained from the Shares issuable upon exercise.
4.5 ISSUANCE OF SHARES. Provided that the Exercise Agreement
and payment are in form and substance satisfactory to counsel for the Company,
the Company shall issue the Shares registered in the name of Participant,
Participant's authorized assignee, or Participant's legal representative, and
shall deliver certificates representing the Shares with the appropriate legends
affixed thereto.
5. NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES. If the Option
is an ISO, and if Participant sells or otherwise disposes of any of the Shares
acquired pursuant to the ISO on or before the later of (1) the date two years
after the Date of Grant, and (2) the date one year after transfer of such Shares
to Participant upon exercise of the Option, Participant shall immediately notify
the Company in writing of such disposition. Participant agrees that Participant
may be subject to income tax withholding by the Company on the compensation
income recognized by Participant from the early disposition by payment in cash
or out of the current wages or other compensation payable to Participant.
6. COMPLIANCE WITH LAWS AND REGULATIONS. The exercise of the Option
and the issuance and transfer of Shares shall be subject to compliance by the
Company and Participant with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange on
which the Company's Common Stock may be listed at the time of such issuance or
transfer.
7. NONTRANSFERABILITY OF OPTION. The Option may not be transferred
in any manner other than by will or by the laws of descent and distribution and
may be exercised during the lifetime of Participant only by Participant. The
terms of the Option shall be binding upon the executors, administrators,
successors and assigns of Participant.
8. TAX CONSEQUENCES. Set forth below is a brief summary as of the
Date of Grant of some of the federal and California tax consequences of exercise
of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY
INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. PARTICIPANT
SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE
SHARES.
8.1 EXERCISE OF ISO. If the Option qualifies as an ISO, there will
be no regular federal or California income tax liability upon the exercise of
the Option, although the excess, if any, of the fair market value of the Shares
on the date of exercise over the Exercise Price will be treated as a tax
preference item for federal income tax purposes and may subject the Participant
to the alternative minimum tax in the year of exercise.
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8.2 EXERCISE OF NONQUALIFIED STOCK OPTION. If the Option does not
qualify as an ISO, there may be a regular federal and California income tax
liability upon the exercise of the Option. Participant will be treated as
having received compensation income (taxable at ordinary income tax rates) equal
to the excess, if any, of the fair market value of the Shares on the date of
exercise over the Exercise Price. The Company will be required to withhold from
Participant's compensation or collect from Participant and pay to the applicable
taxing authorities an amount equal to a percentage of this compensation income
at the time of exercise.
8.3 DISPOSITION OF SHARES. If the Shares are held for more than
twelve (12) months after the date of the transfer of the Shares pursuant to the
exercise of the Option (and, in the case of an ISO, are disposed of more than
two years after the Date of Grant), any gain realized on disposition of the
Shares will be treated as long term capital gain for federal and California
income tax purposes. If Shares purchased under an ISO are disposed of within
one year of exercise or within two years after the Date of Grant, any gain
realized on such disposition will be treated as compensation income (taxable at
ordinary income rates) to the extent of the excess, if any, of the Fair Market
Value of the Shares on the date of exercise over the Exercise Price. The
Company will be required to withhold from Participant's compensation or collect
from Participant and pay to the applicable taxing authorities an amount equal to
a percentage of this compensation income at the time of exercise.
9. PRIVILEGES OF STOCK OWNERSHIP. Participant shall not have any of the
rights of a shareholder with respect to any Shares until Participant exercises
the Option and pays the Exercise Price.
10. INTERPRETATION. Any dispute regarding the interpretation of this
Agreement shall be submitted by Participant or the Company to the Committee for
review. The resolution of such a dispute by the Committee shall be final and
binding on the Company and Participant.
11. ENTIRE AGREEMENT. The Plan is incorporated herein by reference. This
Agreement and the Plan constitute the entire agreement of the parties and
supersede all prior undertakings and agreements with respect to the subject
matter hereof.
12. NOTICES. Any notice required to be given or delivered to the Company
under the terms of this Agreement shall be in writing and addressed to the
Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Participant shall be in writing and
addressed to Participant at the address indicated above or to such other address
as such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon: personal
delivery; three (3) days after deposit in the United States mail by certified or
registered mail (return receipt requested); one (1) business day after deposit
with any return receipt express courier (prepaid); or one (1) business day after
transmission by rapifax or telecopier.
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13. SUCCESSORS AND ASSIGNS. The Company may assign any of its rights
under this Agreement. This Agreement shall be binding upon and inure to the
benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer set forth herein, this Agreement shall be binding upon
Participant and Participant's heirs, executors, administrators, legal
representatives, successors and assigns.
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
15. ACCEPTANCE. Participant hereby acknowledges receipt of a copy of the
Plan and this Agreement. Participant has read and understands the terms and
provisions thereof, and accepts the Option subject to all the terms and
conditions of the Plan and this Agreement. Participant acknowledges that there
may be adverse tax consequences upon exercise of the Option or disposition of
the Shares and that Participant should consult a tax adviser prior to such
exercise or disposition.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in
duplicate by its duly authorized representative and Participant has executed
this Agreement in duplicate as of the Effective Date.
PHOENIX TECHNOLOGIES LTD.: PARTICIPANT:
By:_________________________ _________________________
(Signature)
____________________________ _________________________
(Please print name) (Please print name)
____________________________ _________________________
(Please print title)
- ------------------------------------------------------------------------------
EXHIBIT A
STOCK OPTION EXERCISE AGREEMENT
In such form as is deemed appropriate from time to time by the Company and
which is not inconsistent with the Plan.
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EXHIBIT 5.1
March 9, 1995
Phoenix Technologies Ltd.
2770 De La Cruz Boulevard
Santa Clara, California 95050
Ladies and Gentlemen:
I have been asked by you to examine the Registration Statement on Form S-8
(the "Registration Statement") to be filed by you with the Securities and
Exchange Commission on March 10, 1995 in connection with the registration under
the Securities Act of 1933, as amended, of 1,255,386 shares of your Common
Stock, par value $.001 per share (the "Stock"), that may be sold by you pursuant
to awards granted by you to your (or your parents', affiliates', or
subsidiaries') directors, officers, employees, consultants, advisors, and
independent contractors pursuant to your 1994 Equity Incentive Plan (the
"Plan").
As Vice President, General Counsel and Secretary of the Company, I have
examined the proceedings taken by you in connection with the adoption and
approval of the Plan and the granting of awards under the Plan.
It is my opinion that the 1,255,386 shares of Stock that may be issued and
sold by you pursuant to the Plan, when issued and sold in the manner referred to
in the Prospectus associated with the Registration Statement and the Plan, will
be legally issued, fully-paid and nonassessable.
I consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to all references to me, if any, in the
Registration Statement and any amendments thereto.
Very truly yours,
/s/Scott C. Neely
Scott C. Neely
Vice President, General Counsel and Secretary
SCN:gt
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EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement on
Form S-8 (being filed with respect to the Phoenix Technologies Ltd. 1994 Equity
Incentive Plan) of our report dated November 8, 1994, on our audits of the
consolidated financial statements and financial statement schedules of Phoenix
Technologies Ltd. (Commission File No. 0-17111) as of September 30, 1994 and
1993, and for each of the three fiscal years in the period ended September 30,
1994, which report is included in the Registrant's Annual Report on Form 10-K
for the year ended September 30, 1994. We also consent to the reference to our
firm as experts.
/s/Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
San Jose, California
March 9, 1995
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