<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 7, 2000
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
-----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
FSI INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
MINNESOTA 41-1223238
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
322 LAKE HAZELTINE DRIVE
CHASKA, MINNESOTA 55318
(Address of principal executive offices) (Zip Code)
FSI INTERNATIONAL, INC. 1997 OMNIBUS STOCK PLAN
AND
FSI INTERNATIONAL, INC. EMPLOYEES STOCK PURCHASE PLAN
(Full title of the plans)
DONALD S. MITCHELL
PRESIDENT AND CHIEF EXECUTIVE OFFICER
FSI INTERNATIONAL, INC.
322 LAKE HAZELTINE DRIVE
CHASKA, MINNESOTA 55318
(Name and address of agent for service)
(612) 448-5440
(Telephone number, including area code, of agent for service)
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================
Proposed
Proposed Maximum
Title of Amount Maximum Aggregate Amount of
Securities to to be Offering Price Offering Registration
be Registered Registered(1) Per Share(2) Price(2) Fee
================================================================================================================
<S> <C> <C> <C> <C>
Common Stock, 1,000,000
no par value Shares $15.44 $15,440,000 $4,077
================================================================================================================
</TABLE>
(1) This Registration Statement relates to an additional 750,000 shares to be
offered under the registrant's 1997 Omnibus Stock Plan, for which 1,750,000
shares of Common Stock were registered under Registration Statements Nos.
333-30675 and 333-50991, and an additional 250,000 shares of Common Stock
to be offered under the registrant's Employees Stock Purchase Plan, for
which 1,550,000 shares were registered under Registration Statements Nos.
33-33647, 33-39920, 33-46296, 33-77852, 333-19677, and 333-50991.
(2) Estimated solely for the purpose of the registration fee under Rules 457(c)
and (h)(1) under the Securities Act of 1933, as amended, based on the
average of the high and low sale prices per share of the registrant's
Common Stock on February 2, 2000.
================================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED BY GENERAL INSTRUCTION E OF
FORM S-8 REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
There are incorporated in this Registration Statement by reference the
contents of the registrant's Registration Statements Nos. 33-33647, 33-39920,
33-46296, 33-77852, 333-19677, 333-30675, and 333-50991.
ITEM 8. EXHIBITS (REQUIRED OPINIONS AND CONSENTS).
<TABLE>
<CAPTION>
Exhibit Description
------- -----------
<S> <C>
5 Opinion of Faegre & Benson LLP.
23.1 Consent of Faegre & Benson LLP (included in Exhibit 5).
23.2 Consent of KPMG LLP.
24 Powers of Attorney of directors and officers.
99.1 FSI International, Inc. 1997 Omnibus Stock Plan, as amended.
99.2 FSI International, Inc. Employees Stock Purchase Plan, as amended.
</TABLE>
II-1
<PAGE> 3
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 Chaska, State of Minnesota, on February 7, 2000.
FSI INTERNATIONAL, INC.
By /s/ Donald S. Mitchell*
-----------------------------------------
Donald S. Mitchell
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on February 7, 2000 by the following
persons in the capacities indicated:
/s/ Donald S. Mitchell* President and Chief Executive Officer
- ------------------------------------ (Principal Executive Officer)
Donald S. Mitchell
/s/ Patricia M. Hollister Chief Financial Officer
- ------------------------------------ (Principal Financial and Accounting
Partricia M. Hollister Officer)
JOEL A. ELFTMANN )
JAMES A. BERNARDS )
THOMAS D. GEORGE ) A majority of the Board of Directors*
TERRENCE W. GLARNER )
CHARLES R. WOFFORD )
- ----------------------------
* Patricia M. Hollister, by signing her name hereto, hereby signs this document
on behalf of each of the above-named officers or directors of FSI
International, Inc. pursuant to powers of attorney duly executed by those
persons.
/s/ Patricia M. Hollister
-------------------------------------------
Patricia M. Hollister
Attorney in Fact
II-2
<PAGE> 4
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Description
------- -----------
<S> <C> <C>
5 Opinion of Faegre & Benson LLP........................... Filed
Electronically
23.1 Consent of Faegre & Benson LLP (included in Exhibit 5)
23.2 Consent of KPMG LLP...................................... Filed
Electronically
24 Powers of Attorney of directors and officers............. Filed
Electronically
99.1 FSI International, Inc. 1997 Omnibus Stock Plan, as Filed
amended.................................................. Electronically
99.2 FSI International, Inc. Employees Stock Purchase Plan, as Filed
amended.................................................. Electronically
</TABLE>
<PAGE> 1
EXHIBIT 5
February 7, 2000
FSI International, Inc.
322 Lake Hazeltine Drive
Chaska, Minnesota 55318
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-8 under the
Securities Act of 1933, as amended, relating to the offering of up to an
additional 1,000,000 shares of common stock, without par value (the "Shares"),
of FSI International, Inc., a Minnesota corporation (the "Company"), pursuant to
the Company's 1997 Omnibus Stock Plan, as amended, and the Company's Employees
Stock Purchase Plan, as amended (the "Plans"), we have examined such corporate
records and other documents, including the Registration Statement, and have
reviewed such matters of law as we have deemed relevant hereto, and, based upon
such examination and review, it is our opinion that all necessary corporate
action on the part of the Company has been taken to authorize the issuance and
sale of the Shares and that, when issued and sold as contemplated by the Plans
and the Registration Statement, the Shares will be legally issued, fully paid,
and nonassessable under the current laws of the State of Minnesota.
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ Faegre & Benson LLP
FAEGRE & BENSON LLP
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
FSI International, Inc.:
We consent to the use of our reports incorporated herein by reference.
/s/ KPMG LLP
Minneapolis, Minnesota
February 7, 2000
<PAGE> 1
EXHIBIT 24
FSI INTERNATIONAL, INC.
Power of Attorney
of Director or Officer
The undersigned director or officer of FSI INTERNATIONAL INC. (the
"Corporation"), a Minnesota corporation, hereby makes, constitutes, and appoints
JOEL A. ELFTMANN, DONALD S. MITCHELL, and PATRICIA M. HOLLISTER, and each one of
them, the undersigned's true and lawful attorneys-in-fact, with power of
substitution, for the undersigned and in the undersigned's name, place, and
stead, to sign and affix the undersigned's name as a director or officer of the
Corporation to a Registration Statement, under the Securities Act of 1933, as
amended, on Form S-8 or other applicable form, and all amendments thereto, to be
filed by the Corporation with the Securities and Exchange Commission,
Washington, D.C., in connection with the registration under the Securities Act
of 1933, as amended, of shares of Common Stock to be issued by the Corporation
under its 1997 Omnibus Stock Plan and Employees Stock Purchase Plan and to file
the Registration Statement with the Commission, granting unto the
attorneys-in-fact, and each of them, full power and authority to perform any and
all acts necessary or incidental to the performance and execution of the powers
herein expressly granted.
IN WITNESS WHEREOF the undersigned has set the undersigned's hand this
3rd day of February, 2000.
/s/ Joel A. Elftmann
----------------------------------------------
Joel A. Elftmann
<PAGE> 2
FSI INTERNATIONAL, INC.
Power of Attorney
of Director or Officer
The undersigned director or officer of FSI INTERNATIONAL INC. (the
"Corporation"), a Minnesota corporation, hereby makes, constitutes, and appoints
JOEL A. ELFTMANN, DONALD S. MITCHELL, and PATRICIA M. HOLLISTER, and each one of
them, the undersigned's true and lawful attorneys-in-fact, with power of
substitution, for the undersigned and in the undersigned's name, place, and
stead, to sign and affix the undersigned's name as a director or officer of the
Corporation to a Registration Statement, under the Securities Act of 1933, as
amended, on Form S-8 or other applicable form, and all amendments thereto, to be
filed by the Corporation with the Securities and Exchange Commission,
Washington, D.C., in connection with the registration under the Securities Act
of 1933, as amended, of shares of Common Stock to be issued by the Corporation
under its 1997 Omnibus Stock Plan and Employees Stock Purchase Plan and to file
the Registration Statement with the Commission, granting unto the
attorneys-in-fact, and each of them, full power and authority to perform any and
all acts necessary or incidental to the performance and execution of the powers
herein expressly granted.
IN WITNESS WHEREOF the undersigned has set the undersigned's hand this
7th day of February, 2000.
/s/ Donald S. Mitchell
-----------------------------------------------
Donald S. Mitchell
<PAGE> 3
FSI INTERNATIONAL, INC.
Power of Attorney
of Director or Officer
The undersigned director or officer of FSI INTERNATIONAL INC. (the
"Corporation"), a Minnesota corporation, hereby makes, constitutes, and appoints
JOEL A. ELFTMANN, DONALD S. MITCHELL, and PATRICIA M. HOLLISTER, and each one of
them, the undersigned's true and lawful attorneys-in-fact, with power of
substitution, for the undersigned and in the undersigned's name, place, and
stead, to sign and affix the undersigned's name as a director or officer of the
Corporation to a Registration Statement, under the Securities Act of 1933, as
amended, on Form S-8 or other applicable form, and all amendments thereto, to be
filed by the Corporation with the Securities and Exchange Commission,
Washington, D.C., in connection with the registration under the Securities Act
of 1933, as amended, of shares of Common Stock to be issued by the Corporation
under its 1997 Omnibus Stock Plan and Employees Stock Purchase Plan and to file
the Registration Statement with the Commission, granting unto the
attorneys-in-fact, and each of them, full power and authority to perform any and
all acts necessary or incidental to the performance and execution of the powers
herein expressly granted.
IN WITNESS WHEREOF the undersigned has set the undersigned's hand this
3rd day of February, 2000.
/s/ James A. Bernards
-------------------------------------------------
James A. Bernards
<PAGE> 4
FSI INTERNATIONAL, INC.
Power of Attorney
of Director or Officer
The undersigned director or officer of FSI INTERNATIONAL INC. (the
"Corporation"), a Minnesota corporation, hereby makes, constitutes, and appoints
JOEL A. ELFTMANN, DONALD S. MITCHELL, and PATRICIA M. HOLLISTER, and each one of
them, the undersigned's true and lawful attorneys-in-fact, with power of
substitution, for the undersigned and in the undersigned's name, place, and
stead, to sign and affix the undersigned's name as a director or officer of the
Corporation to a Registration Statement, under the Securities Act of 1933, as
amended, on Form S-8 or other applicable form, and all amendments thereto, to be
filed by the Corporation with the Securities and Exchange Commission,
Washington, D.C., in connection with the registration under the Securities Act
of 1933, as amended, of shares of Common Stock to be issued by the Corporation
under its 1997 Omnibus Stock Plan and Employees Stock Purchase Plan and to file
the Registration Statement with the Commission, granting unto the
attorneys-in-fact, and each of them, full power and authority to perform any and
all acts necessary or incidental to the performance and execution of the powers
herein expressly granted.
IN WITNESS WHEREOF the undersigned has set the undersigned's hand this
2nd day of February, 2000.
/s/ Thomas D. George
-----------------------------------------------
Thomas D. George
<PAGE> 5
FSI INTERNATIONAL, INC.
Power of Attorney
of Director or Officer
The undersigned director or officer of FSI INTERNATIONAL INC. (the
"Corporation"), a Minnesota corporation, hereby makes, constitutes, and appoints
JOEL A. ELFTMANN, DONALD S. MITCHELL, and PATRICIA M. HOLLISTER, and each one of
them, the undersigned's true and lawful attorneys-in-fact, with power of
substitution, for the undersigned and in the undersigned's name, place, and
stead, to sign and affix the undersigned's name as a director or officer of the
Corporation to a Registration Statement, under the Securities Act of 1933, as
amended, on Form S-8 or other applicable form, and all amendments thereto, to be
filed by the Corporation with the Securities and Exchange Commission,
Washington, D.C., in connection with the registration under the Securities Act
of 1933, as amended, of shares of Common Stock to be issued by the Corporation
under its 1997 Omnibus Stock Plan and Employees Stock Purchase Plan and to file
the Registration Statement with the Commission, granting unto the
attorneys-in-fact, and each of them, full power and authority to perform any and
all acts necessary or incidental to the performance and execution of the powers
herein expressly granted.
IN WITNESS WHEREOF the undersigned has set the undersigned's hand this
3rd day of February, 2000.
/s/ Terrence W. Glarner
---------------------------------------------------
Terrence W. Glarner
<PAGE> 6
FSI INTERNATIONAL, INC.
Power of Attorney
of Director or Officer
The undersigned director or officer of FSI INTERNATIONAL INC. (the
"Corporation"), a Minnesota corporation, hereby makes, constitutes, and appoints
JOEL A. ELFTMANN, DONALD S. MITCHELL, and PATRICIA M. HOLLISTER, and each one of
them, the undersigned's true and lawful attorneys-in-fact, with power of
substitution, for the undersigned and in the undersigned's name, place, and
stead, to sign and affix the undersigned's name as a director or officer of the
Corporation to a Registration Statement, under the Securities Act of 1933, as
amended, on Form S-8 or other applicable form, and all amendments thereto, to be
filed by the Corporation with the Securities and Exchange Commission,
Washington, D.C., in connection with the registration under the Securities Act
of 1933, as amended, of shares of Common Stock to be issued by the Corporation
under its 1997 Omnibus Stock Plan and Employees Stock Purchase Plan and to file
the Registration Statement with the Commission, granting unto the
attorneys-in-fact, and each of them, full power and authority to perform any and
all acts necessary or incidental to the performance and execution of the powers
herein expressly granted.
IN WITNESS WHEREOF the undersigned has set the undersigned's hand this
2nd day of February, 2000.
/s/ Charles R. Wofford
---------------------------------------------------
Charles R. Wofford
<PAGE> 1
EXHIBIT 99.1
FSI INTERNATIONAL, INC.
1997 OMNIBUS STOCK PLAN
(as amended January 2000)
1. Purpose. The purpose of the FSI International, Inc. 1997 Omnibus
Stock Plan (the "Plan") is to motivate key personnel to produce a superior
return to the shareholders of the Company by offering such personnel an
opportunity to realize Stock appreciation, by facilitating Stock ownership and
by rewarding them for achieving a high level of corporate financial performance.
The Plan is also intended to facilitate recruiting and retaining key personnel
of outstanding ability by providing an attractive capital accumulation
opportunity. Additionally, the Plan is intended to provide Outside Directors
with an opportunity to acquire a proprietary interest in the Company, to
compensate Outside Directors for their contribution to the Company and to aid in
attracting and retaining Outside Directors.
2. Definitions.
2.1 The terms defined in this Section are used (and capitalized)
elsewhere in the Plan.
(a) "Affiliate" means any corporation that is a "parent
corporation" or "subsidiary corporation" of the Company, as those
terms are defined in Code Section 424(e) and (f), or any
successor provisions.
(b) "Agreement" means (i) a written contract consistent with
the terms of the Plan entered into between the Company or an
Affiliate and a Participant, (ii) containing the terms and
conditions of an Award in such form and not inconsistent with
this Plan as the Committee shall approve from time to time,
together with all amendments thereto, which amendments may be
unilaterally made by the Company (with the approval of the
Committee) unless such amendments are deemed by the Committee to
be materially adverse to the Participant and not required as a
matter of law.
(c) "Award" or "Awards" means a grant made under this Plan
in the form of Restricted Stock, Options, Stock Appreciation
Rights, Performance Units, Stock or any other stock-based award.
(d) "Board" means the Board of Directors of the Company.
(e) "Code" means the Internal Revenue Code of 1986, as
amended and in effect from time to time or any successor statute.
(f) "Committee" means the two or more Non-Employee Directors
designated by the Board to administer the Plan under Plan Section
3.1 and constituted so as to permit grants thereby to comply with
Exchange Act Rule 16b-3.
(g) "Company" means FSI International, Inc., a Minnesota
corporation, or the successor to all or substantially all of its
businesses by merger, consolidation, purchase of assets or
otherwise.
(h) "Effective Date" means the date specified in Plan
Section 12.1.
(i) "Employee" means an employee (including an officer or
director who is also an employee) of the Company or an Affiliate.
(j) "Event" means any of the following:
<PAGE> 2
(1) The acquisition by any individual, entity or group
(within the meaning of Exchange Act Sections 13(d)(3) or
14(d)(2)) of beneficial ownership (within the meaning of Exchange
Act Rule 13d-3) of 30% or more of either (i) the then outstanding
shares of common stock of the Company (the "Outstanding Company
Common Stock") or (ii) the combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of the Board (the "Outstanding Company
Voting Securities"); provided, however, that the following
acquisitions shall not constitute an Event:
(A) any acquisition of common stock or voting
securities of the Company directly from the Company,
(B) any acquisition of common stock or voting
securities of the Company by the Company or any of its
wholly-owned Subsidiaries,
(C) any acquisition of common stock or voting
securities of the Company by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any
of its Subsidiaries, or
(D) any acquisition by any corporation with respect to
which, immediately following such acquisition, more than 70%
of, respectively, the then outstanding shares of common
stock of such corporation and the combined voting power of
the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were
the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting
Securities immediately prior to such acquisition in
substantially the same proportions as was their ownership,
immediately prior to such acquisition, of the Outstanding
Company Common Stock and Outstanding Company Voting
Securities, as the case may be;
(2) Individuals who, as of the EffectiveDate, constitute
the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided, however,
that any individual becoming a director of the Board subsequent
to the Effective Date whose election, or nomination for election
by the Company's shareholders, was approved by a vote of at least
a majority of the directors then comprising the Incumbent Board
shall be considered a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or
threatened election contest that was (or, if threatened, would
have been) subject to Exchange Act Rule 14a-11 or its successor
provision;
(3) Approval by the shareholders of the Company of a
reorganization, merger, consolidation or statutory exchange of
Outstanding Company Voting Securities, unless immediately
following such reorganization, merger, consolidation or exchange,
all or substantially all of the individuals and entities who were
the beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities
immediately prior to such reorganization, merger, consolidation
or exchange beneficially own, directly or indirectly, more than
70% of, respectively, the then outstanding shares of common stock
and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from
such reorganization, merger, consolidation or exchange in
substantially the same proportions as was their ownership,
immediately prior to such reorganization, merger, consolidation
or exchange, of the Outstanding
2
<PAGE> 3
Company Common Stock and Outstanding Company Voting Securities,
as the case may be; or
(4) Approval by the shareholders of the Company of (i) a
complete liquidation or dissolution of the Company or (ii) the
sale or other disposition of all or substantially all of the
assets of the Company, other than to a corporation with respect
to which, immediately following such sale or other disposition,
more than 70% of, respectively, the then outstanding shares of
common stock of such corporation and the combined voting power of
the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities
immediately prior to such sale or other disposition in
substantially the same proportion as was their ownership,
immediately prior to such sale or other disposition, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be.
Notwithstanding the above, an Event shall not be deemed to occur with
respect to a recipient of an Award if the acquisition of the 30% or greater
interest referred to in paragraph (1) is by a group, acting in concert, that
includes that recipient of an Award or if at least 30% of the then outstanding
common stock or combined voting power of the then outstanding voting securities
(or voting equity interests) of the surviving corporation or of any corporation
(or other entity) acquiring all or substantially all of the assets of the
Company shall be beneficially owned, directly or indirectly, immediately after a
reorganization, merger, consolidation, statutory share exchange or disposition
of assets referred to in paragraphs (3) or (4) by a group, acting in concert,
that includes that recipient of an Award.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as
amended and in effect from time to time, or any successor statute.
(l) "Exchange Act Rule 16b-3" means Rule 16b-3 promulgated by
the Securities and Exchange Commission under the Exchange Act as now
in force and in effect from time to time or any successor regulation.
(m) "Fair Market Value" as of any date means, unless otherwise
expressly provided in the Plan:
(i) the closing price of a Share on the date immediately
preceding that date or, if no sale of Shares shall have occurred
on that date, on the next preceding day on which a sale of Shares
occurred
(A) on the composite tape for New York Stock Exchange
listed shares, or
(B) if the Shares are not quoted on the composite tape
for New York Stock Exchange listed shares, on the principal
United States Securities Exchange registered under the
Exchange Act on which the Shares are listed, or
(C) if the Shares are not listed on any such exchange,
on the National Association of Securities Dealers, Inc.
Automated Quotations National Market System, or
(ii) if clause (i) is inapplicable, the mean between the
closing "bid" and the closing "asked" quotation of a Share on the
date immediately preceding that date, or, if no closing bid or
asked quotation is made on that date, on the next preceding day
on
3
<PAGE> 4
which a closing bid and asked quotation is made, on the National
Association of Securities Dealers, Inc. Automated Quotations
System or any system then in use, or
(iii) if clauses (i) and (ii) are inapplicable, what the
Committee determines in good faith to be 100% of the fair market
value of a Share on that date, using such criteria as it shall
determine, in its sole discretion, to be appropriate for
valuation.
However, if the applicable securities exchange or system has closed
for the day at the time the event occurs that triggers a determination of Fair
Market Value, whether the grant of an Award, the exercise of an Option or Stock
Appreciation Right or otherwise, all references in this paragraph to the "date
immediately preceding that date" shall be deemed to be references to "that
date". In the case of an Incentive Stock Option, if this determination of Fair
Market Value is not consistent with the then current regulations of the
Secretary of the Treasury, Fair Market Value shall be determined in accordance
with those regulations. The determination of Fair Market Value shall be subject
to adjustment as provided in Plan Section 16.
(n) "Fundamental Change" shall mean a dissolution or liquidation
of the Company, a sale of substantially all of the assets of the
Company, a merger or consolidation of the Company with or into any
other corporation, regardless of whether the Company is the surviving
corporation, or a statutory share exchange involving capital stock of
the Company.
(o) "Incentive Stock Option" means any Option designated as such
and granted in accordance with the requirements of Code Section 422 or
any successor provision.
(p) "Insider" as of a particular date means any person who, as
of that date is an officer of the Company as defined under Exchange
Act Rule 16a-1(f) or its successor provision.
(q) "Non-Employee Director" means a member of the Board who is
considered a non-employee director within the meaning of Exchange Act
Rule 16b-3(b)(3) or its successor provision.
(r) "Non-Statutory Stock Option" means an Option other than an
Incentive Stock Option.
(s) "Option" means a right to purchase Stock, including both
Non-Statutory Stock Options and Incentive Stock Options.
(t) "Outside Director" means a director who is not an Employee.
(u) "Participant" means a person or entity to whom an Award is
or has been made in accordance with the Plan.
(v) "Performance Cycle" means the period of time as specified in
an Agreement over which Performance Units are to be earned.
(w) "Performance Units" means an Award made pursuant to Plan
Section 11.
(x) "Plan" means this FSI International, Inc. 1997 Omnibus Stock
Plan, as may be amended and in effect from time to time.
(y) "Restricted Stock" means Stock granted under Plan Section 7
so long as such Stock remains subject to one or more restrictions.
(z) "Section 16" or "Section 16(b)" means Section 16 or Section
16(b), respectively, of the Exchange Act or any successor statute and
the rules and regulations
4
<PAGE> 5
promulgated thereunder as in effect and as amended from time to time.
(aa) "Share" means a share of Stock.
(bb) "Stock" means the common stock, no designated par value,
oF the Company.
(cc) "Stock Appreciation Right" means a right, the value of
which is determined in relation to the appreciation in value of Shares
pursuant to an Award granted under Plan Section 10.
(dd) "Subsidiary" means a "subsidiary corporation", as that
term is defined in Code Section 424(f), or any successor provision.
(ee) "Successor" with respect to a Participant means the legal
representative of an incompetent Participant, and if the Participant
is deceased the estate of the Participant or the person or persons who
may, by bequest or inheritance, or pursuant to the terms of an Award,
acquire the right to exercise an Option or Stock Appreciation Right or
to receive cash and/or Shares issuable in satisfaction of an Award in
the event of the Participant's death.
(ff) "Term" means the period during which an Option or Stock
Appreciation Right may be exercised or the period during which the
restrictions or terms and conditions placed on Restricted Stock or any
other Award are in effect.
(gg) "Transferee" means any member of the Participant's
immediate family (i.e., his or her children, step-children,
grandchildren and spouse) or to one or more trusts for the benefit of
such family members or partnerships in which such family members are
the only partners.
2.2 Gender and Number. Except when otherwise indicated by the
context, reference to the masculine gender shall include, when used, the
feminine gender and any term used in the singular shall also include the plural.
3. Administration and Indemnification.
3.1 Administration.
(a) The Committee shall administer the Plan. The Committee
shall have exclusive power to (i) make Awards, (ii) determine when and
to whom Awards will be granted, the form of each Award, the amount of
each Award (except as to the amount of the Initial Outside Director
Option and the Annual Outside Director Option, as provided in Plan
Section 9.3), and any other terms or conditions of each Award
consistent with the Plan, and (iii) determine whether, to what extent
and under what circumstances, Awards may be settled, paid or exercised
in cash, Shares or other Awards, or other property or canceled,
forfeited or suspended. Each Award shall be subject to an Agreement
which has been authorized by the Committee.
(b) Solely for purposes of determining and administering
Awards to Participants who are not Insiders, the Committee may delegate
all or any portion of their authority under the Plan to one or more
persons who are not Non-Employee Directors.
(c) To the extent within its discretion and subject to Plan
Sections 15 and 16, other than price, the Committee may amend the terms
and conditions of any outstanding Award.
(d) It is the intent that the Plan and all Awards granted
pursuant to it shall be administered by the Committee so as to permit
the Plan and Awards to comply with Exchange Act Rule 16b-3, except in
such instances as the Committee, in its discretion, may so provide. If
any
5
<PAGE> 6
provision of the Plan or of any Award would otherwise frustrate or
conflict with the intent expressed in this Section 3.1(d), that
provision to the extent possible shall be interpreted and deemed
amended in the manner determined by the Committee so as to avoid the
conflict. To the extent of any remaining irreconcilable conflict with
this intent, the provision shall be deemed void as applicable to
Insiders to the extent permitted by law and in the manner deemed
advisable by the Committee.
(e) The Committee's interpretation of the Plan and of any
Award or Agreement made under the Plan and all related decisions or
resolutions of the Board or Committee shall be final and binding on
all parties with an interest therein. Consistent with its terms, the
Committee shall have the power to establish, amend or waive
regulations to administer the Plan. In carrying out any of its
responsibilities, the Committee shall have discretionary authority to
construe the terms of the Plan and any Award or Agreement made under
the Plan.
3.2 Indemnification. Each person who is or shall have been a member
of the Committee, or of the Board, and any other person to whom the Committee
delegates authority under the Plan, shall be indemnified and held harmless by
the Company, to the extent permitted by law, against and from any loss, cost,
liability or expense that may be imposed upon or reasonably incurred by such
person in connection with or resulting from any claim, action, suit or
proceeding to which such person may be a party or in which such person may be
involved by reason of any action taken or failure to act, made in good faith,
under the Plan and against and from any and all amounts paid by such person in
settlement thereof, with the Company's approval, or paid by such person in
satisfaction of any judgment in any such action, suit or proceeding against such
person, provided such person shall give the Company an opportunity, at the
Company's expense, to handle and defend the same before such person undertakes
to handle and defend it on such person's own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to
which such person or persons may be entitled under the Company's Articles of
Incorporation or By-laws, as a matter of law, or otherwise, or any power that
the Company may have to indemnify them or hold them harmless.
4. Shares Available Under the Plan.
(a) The number of Shares available for distribution under this
Plan shall not exceed 2,500,000 (subject to adjustment pursuant to Plan
Section 16).
(b) Any Shares subject to the terms and conditions of an Award
under this Plan that are not used because the terms and conditions of the
Award are not met may again be used for an Award under the Plan. But Shares
with respect to which a Stock Appreciation Right has been exercised whether
paid in cash and/or in Shares may not again be awarded under this Plan.
(c) Any unexercised or undistributed portion of any terminated,
expired, exchanged, or forfeited Award, or any Award settled in cash in
lieu of Shares (except as provided in Plan Section 4(b)) shall be available
for further Awards.
(d) For the purposes of computing the total number of Shares
granted under the Plan, the following rules shall apply to Awards payable
in Shares where appropriate:
(i) each Option shall be deemed to be the equivalent of the
maximum number of Shares that may be issued upon exercise of the
particular Option;
(ii) an Award (other than an Option) payable in some other
security shall be deemed to be equal to the number of Shares to which
it relates;
(iii) where the number of Shares available under the Award is
variable on the date it is granted, the number of Shares shall be
deemed to be the maximum number of Shares that could be received
under that particular Award; and
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(iv) where two or more types of Awards (all of which
are payable in Shares) are granted to a Participant in tandem
with each other, such that the exercise of one type of Award
with respect to a number of Shares cancels at least an equal
number of Shares of the other, each such joint Award shall be
deemed to be the equivalent of the maximum number of Shares
available under the largest single Award.
Additional rules for determining the number of Shares granted under
the Plan may be made by the Committee, as it deems necessary or desirable.
(e) No fractional Shares may be issued under the Plan;
however, cash shall be paid in lieu of any fractional Share in
settlement of an Award.
(f) The maximum number of Shares that may be awarded to a
Participant in any calendar year in the form of Options is 100,000 and
the maximum number of Shares that may be awarded to a Participant in
any calendar year in the form of Stock Appreciation Rights is 100,000.
5. Eligibility. Participation in the Plan shall be limited to Employees
and individuals or entities who are not Employees but who provide services to
the Company or an Affiliate, including services provided in the capacity of a
consultant, advisor or director. The granting of Awards is solely at the
discretion of the Committee, except that Incentive Stock Options may only be
granted to Employees and Awards to Outside Directors are subject to the limits
of Section 9.3(g).
6. General Terms of Awards.
6.1 Amount of Award. Each Agreement shall set forth the number of
Shares of Restricted Stock, Stock or Performance Units subject to the Agreement,
or the number of Shares to which the Option subject to the Agreement applies or
with respect to which payment upon the exercise of the Stock Appreciation Right
subject to the Agreement is to be determined, as the case may be, together with
such other terms and conditions applicable to the Award as determined by the
Committee acting in its sole discretion.
6.2 Term. Each Agreement, other than those relating solely to
Awards of Shares without restrictions, shall set forth the Term of the Option,
Stock Appreciation Right, Restricted Stock or other Award or the Performance
Cycle for the Performance Units, as the case may be. Acceleration of the
expiration of the applicable Term is permitted, upon such terms and conditions
as shall be set forth in the Agreement, which may, but need not, include without
limitation, acceleration resulting from the occurrence of an Event or in the
event of the Participant's death or retirement. Acceleration of the Performance
Cycle of Performance Units shall be subject to Plan Section 11.2.
6.3 Transferability. Except as provided in this Section, during
the lifetime of a Participant to whom an Award is granted, only that Participant
(or that Participant's legal representative) may exercise an Option or Stock
Appreciation Right, or receive payment with respect to Performance Units or any
other Award. No Award of Restricted Stock (prior to the expiration of the
restrictions), Options, Stock Appreciation Rights or Performance Units or other
Award may be sold, assigned, transferred, exchanged or otherwise encumbered
other than pursuant to a qualified domestic relations order as defined in the
Code or Title 1 of the Employee Retirement Income Security Act ("ERISA") or the
rules thereunder; any attempted transfer in violation of this Section 6.3 shall
be of no effect. Notwithstanding the immediately preceding sentence, the
Committee, in an Agreement or otherwise at its discretion, may provide (i) that
the Award subject to the Agreement shall be transferable to a Successor in the
event of a Participant's death, or (ii) that the Award (other than Incentive
Stock Options) may be transferable to a Transferee. Any Award held by a
Transferee shall continue to be subject to the same terms and conditions that
were applicable to that Award immediately prior to the transfer thereof to the
Transferee.
6.4 Termination of Employment. No Option or Stock Appreciation
Right may be exercised by a Participant, all Restricted Stock held by a
Participant or any other Award then subject to restrictions shall be forfeited,
and no payment with respect to Performance Units for which the applicable
Performance Cycle has not
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been completed shall be made, if the Participant's employment or other
relationship with the Company and its Affiliates shall be voluntarily terminated
or involuntarily terminated with or without cause prior to the expiration of the
Term of the Option, Stock Appreciation Right, Restricted Stock or other Award,
or the completion of the Performance Cycle, as the case may be, except as, and
to the extent, provided in the Agreement applicable to that Award. An Award may
be exercised by, or paid to, a Transferee or the Successor of a Participant
following the death of the Participant to the extent, and during the period of
time, if any, provided in the applicable Agreement.
6.5 Rights as Shareholder. Each Agreement shall provide that a
Participant shall have no rights as a shareholder with respect to any securities
covered by an Award if and until the date the Participant becomes the holder of
record of the Stock, if any, to which the Award relates.
7. Restricted Stock Awards.
(a) An Award of Restricted Stock under the Plan shall consist
of Shares subject to restrictions on transfer and conditions of
forfeiture, which restrictions and conditions shall be included in the
applicable Agreement. The Committee may provide for the lapse or
waiver of any such restriction or condition based on such factors or
criteria as the Committee, in its sole discretion, may determine.
(b) Except as otherwise provided in the applicable Agreement,
each Stock certificate issued with respect to an Award of Restricted
Stock shall either be deposited with the Company or its designee,
together with an assignment separate from the certificate, in blank,
signed by the Participant, or bear such legends with respect to the
restricted nature of the Restricted Stock evidenced thereby as shall
be provided for in the applicable Agreement.
(c) The Agreement shall describe the terms and conditions by
which the restrictions and conditions of forfeiture upon awarded
Restricted Stock shall lapse. Upon the lapse of the restrictions and
conditions, Shares free of restrictive legends, if any, relating to
such restrictions shall be issued to the Participant or a Successor or
Transferee.
(d) A Participant or a Transferee with a Restricted Stock
Award shall have all the other rights of a shareholder including, but
not limited to, the right to receive dividends and the right to vote
the Shares of Restricted Stock.
(e) No more than 100,000 of the total number of Shares
available for Awards under the Plan shall be issued during
the term of the Plan as Restricted Stock. This limitation shall be
calculated pursuant to the applicable provisions of Plan Sections 4
and 16.
8. Other Awards. The Committee may from time to time grant Stock and
other Awards under the Plan including without limitations those Awards pursuant
to which Shares are or may in the future be acquired, Awards denominated in
Stock units, securities convertible into Stock and phantom securities. The
Committee, in its sole discretion, shall determine the terms and conditions of
such Awards provided that such Awards shall not be inconsistent with the terms
and purposes of this Plan. The Committee may, at its sole discretion, direct the
Company to issue Shares subject to restrictive legends and/or stop transfer
instructions that are consistent with the terms and conditions of the Award to
which the Shares relate.
No more than 25,000 of the total number of Shares available for Awards
under the Plan shall be issued during the term of the Plan in the form of Stock
without restrictions.
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<PAGE> 9
9. Stock Options.
9.1 Terms of All Options.
(a) An Option shall be granted pursuant to an
Agreement as either an Incentive Stock Option or a
Non-Statutory Stock Option. The purchase price of each Share
subject to an Option shall be determined by the Committee and
set forth in the Agreement, but shall not be less than 100% of
the Fair Market Value of a Share as of the date the Option is
granted (except as provided in Plan Section 19).
(b) The purchase price of the Shares with respect to
which an Option is exercised shall be payable in full at the
time of exercise, provided that to the extent permitted by
law, the Agreement may permit some or all Participants to
simultaneously exercise Options and sell the Shares thereby
acquired pursuant to a brokerage or similar relationship and
use the proceeds from the sale as payment of the purchase
price of the Shares. The purchase price may be payable in
cash, in Shares having a Fair Market Value as of the date the
Option is exercised equal to the purchase price of the Shares
being purchased pursuant to the Option, or a combination
thereof, as determined by the Committee and provided in the
Agreement but no fractional Shares will be issued or accepted.
(c) The Committee may provide, in an Agreement or
otherwise, that a Participant who exercises an Option and pays
the Option price in whole or in part with Shares then owned by
the Participant will be entitled to receive another Option
covering the same number of shares tendered and with a price
of no less than Fair Market Value on the date of grant of such
additional Option ("Reload Option"). Unless otherwise provided
in the Agreement, a Participant, in order to be entitled to a
Reload Option, must pay with Shares that have been owned by
the Participant for at least the preceding 180 days.
(d) Each Option shall be exercisable in whole or in
part on the terms provided in the Agreement. In no event shall
any Option be exercisable at any time after the expiration of
its Term. When an Option is no longer exercisable, it shall be
deemed to have lapsed or terminated.
9.2 Incentive Stock Options. In addition to the other terms
and conditions applicable to all Options:
(i) the aggregate Fair Market Value (determined as of
the date the Option is granted) of the Shares with respect to
which Incentive Stock Options held by an individual first
become exercisable in any calendar year (under this Plan and
all other incentive stock option plans of the Company and its
Affiliates) shall not exceed $100,000 (or such other limit as
may be required by the Code) if this limitation is necessary
to qualify the Option as an Incentive Stock Option and to the
extent an Option or Options granted to a Participant exceed
this limit the Option or Options shall be treated as a
Non-Statutory Stock Option;
(ii) an Incentive Stock Option shall not be
exercisable more than 10 years after the date of grant (or
such other limit as may be required by the Code) if this
limitation is necessary to qualify the Option as an Incentive
Stock Option;
(iii) the Agreement covering an Incentive Stock Option
shall contain such other terms and provisions that the
Committee determines necessary to qualify this Option as an
Incentive Stock Option; and
(iv) notwithstanding any other provision of this Plan
to the contrary, no Participant may receive an Incentive Stock
Option under the Plan if, at the time the Award is granted,
the Participant owns (after application of the rules contained
in Code Section 424(d), or its successor
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<PAGE> 10
provision), Shares possessing more than ten percent of the
total combined voting power of all classes of stock of the
Corporation or its subsidiaries, unless (i) the option price
for that Incentive Stock Option is at least 110 percent of
the Fair Market Value of the Shares subject to that
Incentive Stock Option on the date of grant and (ii) that
Option is not exercisable after the date five years from the
date that Incentive Stock Option is granted.
9.3 Terms and Conditions of Outside Directors' Options.
(a) Initial Outside Directors' Options. Subject to
the terms and conditions of this Plan, any Outside Director
first elected or appointed to the Board on or after January
22, 1997 (the "Approval Date") shall receive, by virtue of
serving as a director of the Company, a single grant of a
Non-Statutory Stock Option to purchase 12,000 Shares (an
"Initial Outside Director Option").
(b) Vesting of Initial Outside Directors' Options.
Subject to the provisions of Plan Section 9.3(e), Initial
Outside Directors' Options granted pursuant to this Plan shall
vest and become exercisable six months after the date of
grant. Each Initial Outside Directors' Option, to the extent
exercisable, shall be exercisable in whole or in part
(c) Annual Outside Director Option Grants. For the
Annual Meeting of Shareholders for fiscal year 1997 (to be
held on January 22, 1997) and for each Annual Meeting of
Shareholders thereafter during the term of this Plan, each
Outside Director serving as an Outside Director of the Company
immediately following the Annual Meeting shall be granted, by
virtue of serving as an Outside Director of the Company, a
Non-Statutory Stock Option to purchase 5,000 Shares (an
"Annual Outside Director Option"). Each Annual Outside
Director Option shall be deemed to be granted to each Outside
Director immediately after an Annual Meeting and shall be
granted regardless of whether or not an Outside Director
previously received, or simultaneously receives, an Initial
Outside Director Option. Initial Outside Director Options and
Annual Outside Director Options together are sometimes
referred to as "Outside Director Options."
(d) Vesting of Annual Director Options. Subject to
the provisions of Plan Section 9.3(e), Annual Outside Director
Options shall vest and become exercisable cumulatively on an
annual basis, as follows: one-half of the total number of
Shares subject to each Option shall become exercisable on each
January 1st following the date of grant until the Option is
fully vested. Each Option, to the extent exercisable, shall be
exercisable in whole or in part.
(e) Termination of Initial and Annual Outside
Directors' Options. Each Outside Director Option granted
pursuant to this Plan and all rights to purchase Shares
thereunder shall terminate on the earliest of:
(i) ten years after the date that the Outside
Director Option was granted;
(ii) the expiration of the period specified in the
Agreement after the death or permanent disability
of an Outside Director;
(iii) February 28, 1997, if the shareholders of the
Company shall not have approved this Plan as of
or prior to that date at a duly held
shareholders' meeting; or
(iv) ninety days after the date the Outside
Director ceases to be a director of the Company,
provided, however, that the option shall be
exercisable during this 90-day period only to the
extent the option was exercisable as of the date
the person ceases to be an Outside Director
unless the cessation results from the director's
death or permanent disability. Notwithstanding
the preceding sentence, if an Outside Director
who resigns or whose term expires then
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becomes a consultant or Employee of the Company within
ninety days of such resignation or term expiration, the
Outside Director Options of such person shall continue in
full force and effect.
In no event shall an Option be exercisable at any time after its
original expiration date. When an Option is no longer exercisable, it shall
be deemed to have lapsed or terminated and will no longer be outstanding.
(f) Allocation of Common Shares. If as of a date on which an Option
or Options are to be awarded pursuant to the provisions of this Section
9.3, the number of Shares available for issuance under the Plan as of this
date are less than the number of options to purchase Shares that otherwise
would be awarded, then the following formula shall determine how the
remaining number of Shares are to be allocated:
(i) if only one Outside Director is to receive an Option on the date,
then that Outside Director shall receive an Option to purchase
Shares equal to the number of Shares remaining;
(ii) if two or more Outside Directors are to receive Options on the
date:
(1) all Initial Outside Director Options shall first be awarded;
if, however, the number of Shares available is less than the
number of options to purchase Shares that would otherwise be
awarded as Initial Outside Director Options then each
Outside Director eligible to receive an Initial Outside
Director Option shall receive the number of Options that
results from the following equation: the whole number of
Shares available divided by the number of Outside Directors
eligible to receive such an Option, provided, however, that
no fractional shares shall be awarded; and if such
allocation occurs, any remaining Shares shall not be awarded
and shall be deemed not subject to distribution for purposes
of Plan Section 4; and
(2) If on that date all Initial Outside Director Options to be
awarded are awarded in the full amount or if no Initial
Outside Director Options are to be awarded, then each
Outside Director eligible for an Annual Outside Director
Option shall receive an Annual Outside Director Option to
purchase Shares in the amount that results from the
following equation: the whole number of Shares available
divided by the number of Outside Directors eligible for an
Annual Outside Director Option, provided, however, that no
fractional shares shall be awarded; and any remaining Shares
shall not be awarded and shall be deemed not subject to
distribution for purposes of Plan Section 4.
(g) Non-exclusivity of Section 9.3. The provisions of this
Section 9.3 are not intended to be exclusive; however, the Committee,
in its discretion, may grant Options or other Awards to an Outside
Director, but only in substitution for Outside Director Options held by
that director.
10. Stock Appreciation Rights. An Award of a Stock Appreciation Right
shall entitle the Participant (or a Successor or Transferee), subject to terms
and conditions determined by the Committee, to receive upon exercise of the
Stock Appreciation Right all or a portion of the excess of (i) the Fair Market
Value of a specified number of Shares as of the date of exercise of the Stock
Appreciation Right over (ii) a specified price that shall not be less than 100%
of the Fair Market Value of such Shares as of the date of grant of the Stock
Appreciation Right. A Stock Appreciation Right may be granted in connection with
part or all of, in addition to, or completely
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independent of an Option or any other Award under this Plan. If issued in
connection with a previously or contemporaneously granted Option, the Committee
may impose a condition that exercise of a Stock Appreciation Right cancels a pro
rata portion of the Option with which it is connected and vice versa. Each Stock
Appreciation Right may be exercisable in whole or in part on the terms provided
in the Agreement. Notwithstanding anything to the contrary stated in the Plan,
no Stock Appreciation Right shall be exercisable by a Participant or Successor
or Transferee prior to six months from the date of grant except in the event of
the death or disability of the Participant. No Stock Appreciation Right shall be
exercisable at any time after the expiration of its Term. When a Stock
Appreciation Right is no longer exercisable, it shall be deemed to have lapsed
or terminated. Upon exercise of a Stock Appreciation Right, payment to the
Participant or a Successor or Transferee shall be made at such time or times as
shall be provided in the Agreement in the form of cash, Shares or a combination
of cash and Shares as determined by the Committee and provided in the Agreement.
The Agreement may provide for a limitation upon the amount or percentage of the
total appreciation on which payment (whether in cash and/or Shares) may be made
in the event of the exercise of a Stock Appreciation Right.
11. Performance Units.
11.1 Initial Award.
(a) An Award of Performance Units under the Plan
shall entitle the Participant or a Successor or Transferee to
future payments of cash, Shares or a combination of cash and
Shares, as determined by the Committee and provided in the
Agreement, based upon the achievement of pre-established
performance targets. These performance targets may, but need
not, include without limitation targets relating to one or
more of the Company's or a group's, unit's, Affiliate's or an
individual's performance. The Agreement may establish that a
portion of the total potential of a Participant's Award will
be paid for performance that exceeds the minimum target but
falls below the maximum target applicable to the Award. The
Agreement shall also provide for the timing of the payment.
(b) Following the conclusion or acceleration of each
Performance Cycle, the Committee shall determine the extent to
which (i) performance targets have been attained, (ii) any
other terms and conditions with respect to an Award relating
to the Performance Cycle have been satisfied and (iii) payment
is due with respect to an Award of Performance Units.
11.2 Acceleration and Adjustment. The Agreement may permit
an acceleration of the Performance Cycle and an adjustment of performance
targets and payments with respect to some or all of the Performance Units
awarded to a Participant, upon such terms and conditions as shall be set forth
in the Agreement, upon the occurrence of certain events, which may, but need not
include without limitation an Event, a Fundamental Change, a recapitalization, a
change in the accounting practices of the Company, a change in the Participant's
title or employment responsibilities, the Participant's death or retirement or,
with respect to payments in Shares with respect to Performance Units, a
reclassification, stock dividend, stock split or stock combination as provided
in Plan Section 16. The Agreement also may provide for a limitation on the value
of an Award of Performance Units that a Participant may receive.
12. Effective Date and Duration of the Plan.
12.1 Effective Date. The Plan became effective as of
January 22, 1997.
12.2 Duration of the Plan. The Plan shall remain in
effect until all Stock subject to itshall be distributed or until all Awards
have expired or lapsed, or the Plan is terminated pursuant to Plan Section 15 or
until January 23, 2007 (the "Termination Date"); provided, however, Awards made
prior to the Termination Date may be exercised, vested or otherwise effectuated
beyond the Termination Date unless limited in the Agreement or otherwise. No
Award of an Incentive Stock Option shall be made more than 10 years after the
Effective Date (or such other limit as may be required by the Code) if this
limitation is necessary to qualify the Option as an Incentive Stock Option. The
date and time of approval by the Committee of the granting of an Award (or such
other time as
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the Committee may designate) shall be considered the date and time at which the
Award is made or granted.
13. Plan Does Not Affect Employment Status.
(a) Status as an eligible Employee shall not be construed
as a commitment that any Award will be made under the Plan to
that eligible Employee or to eligible Employees generally.
(b) Nothing in the Plan or in any Agreement or related
documents shall confer upon any Employee or Participant any
right to continue in the employment of the Company or any
Affiliate or constitute any contract of employment or affect any
right that the Company or any Affiliate may have to change such
person's compensation, other benefits, job responsibilities, or
title, or to terminate the employment of such person with or
without cause.
14. Tax Withholding. The Company shall have the right to withhold
From any cash payment under the Plan to a Participant or other person (including
a Successor or a Transferee) an amount sufficient to cover any required
withholding taxes. The Company shall have the right to require a Participant or
other person receiving Shares under the Plan to pay the Company a cash amount
sufficient to cover any required withholding taxes before actual receipt of
those Shares. In lieu of all or any part of a cash payment from a person
receiving Shares under the Plan, the Committee may permit the individual to
cover all or any part of the required withholdings, and to cover any additional
withholdings up to the amount needed to cover the individual's full FICA and
federal, state and local income taxes with respect to income arising from
payment of the Award, through a reduction of the number of Shares delivered or a
subsequent return to the Company of Shares held by the Participant or other
person, in each case valued in the same manner as used in computing the
withholding taxes under the applicable laws.
15. Amendment, Modification and Termination of the Plan.
(a) The Board may at any time and from time to time terminate,
suspend or modify the Plan. Except as limited in (b) below, the
Committee may at any time alter or amend any or all Agreements under
the Plan to the extent permitted by law. However, no such action may,
without further approval of the shareholders of the Company, be
effective if such approval is required in order that the Plan conform
to the requirements of Code Section 422.
(b) No termination, suspension, or modification of the Plan
materially and adversely affect any right acquired by any Participant
or Successor or Transferee under an Award granted before the date of
termination, suspension, or modification, unless otherwise agreed to by
the Participant in the Agreement or otherwise, or required as a matter
of law; but it will be conclusively presumed that any adjustment for
changes in capitalization provided for in Plan Sections 11.2 or 16 does
not adversely affect these rights.
16. Adjustment for Changes in Capitalization. Subject to any
required action by the Company's shareholders, appropriate adjustments, so as to
prevent enlargement of rights or inappropriate dilution - (i) in the aggregate
number and type of Shares available for Awards under the Plan, (ii) in the
limitations on the number of Shares that may be issued to an individual
Participant as an Option or a Stock Appreciation Right in any calendar year or
that may be issued in the form of Restricted Stock or Shares without
restrictions, (iii) in the number and type of Shares and amount of cash subject
to Awards then outstanding, (iv) in the Option price as to any outstanding
Options and, (v) subject to Plan Section 11.2, in outstanding Performance Units
and payments with respect to outstanding Performance Units - may be made by the
Committee in its sole discretion to give effect to adjustments made in the
number or type of Shares through a Fundamental Change (subject to Plan Section
17), recapitalization, reclassification, stock dividend, stock split, stock
combination or other relevant change, provided that fractional Shares shall be
rounded to the nearest whole Share.
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17. Fundamental Change. In the event of a proposed Fundamental
Change, the Committee may, but shall not be obligated to:
(a) if the Fundamental Change is a merger or consolidation or
statutory share exchange, make appropriate provision for the protection
of the outstanding Options and Stock Appreciation Rights by the
substitution of options, stock appreciation rights and appropriate
voting common stock of the corporation surviving any merger or
consolidation or, if appropriate, the parent corporation of the Company
or such surviving corporation to be issuable upon the exercise of
Options or used to calculate payments upon the exercise of Stock
Appreciation Rights, in lieu of options, stock appreciation rights and
capital stock of the Company; or
(b) at least 30 days prior to the occurrence of the Fundamental
Change, declare, and provide written notice to each holder of an Option
or Stock Appreciation Right of the declaration, that each outstanding
Option and Stock Appreciation Right, whether or not then exercisable,
shall be canceled at the time of, or immediately prior to the
occurrence of the Fundamental Change in exchange for payment to each
holder of an Option or Stock Appreciation Right, within ten days after
the Fundamental Change, of cash equal to (i) for each Share covered by
the canceled Option, the amount, if any, by which the Fair Market Value
(as hereinafter defined in this Section) per Share exceeds the exercise
price per Share covered by such Option or (ii) for each Stock
Appreciation Right, the price determined pursuant to Section 10, except
that Fair Market Value of the Shares as of the date of exercise of the
Stock Appreciation Right, as used in clause (i) of Plan Section 10,
shall be deemed to mean Fair Market Value for each Share with respect
to which the Stock Appreciation Right is calculated determined in the
manner hereinafter referred to in this Section. At the time of the
declaration provided for in the immediately preceding sentence, each
Stock Appreciation Right that has been outstanding for at least six
months and each Option shall immediately become exercisable in full and
each person holding an Option or a Stock Appreciation Right shall have
the right, during the period preceding the time of cancellation of the
Option or Stock Appreciation Right, to exercise the Option as to all or
any part of the Shares covered thereby or the Stock Appreciation Right
in whole or in part, as the case may be. In the event of a declaration
pursuant to this Plan Section 17(b), each outstanding Option and Stock
Appreciation Right granted pursuant to the Plan that shall not have
been exercised prior to the Fundamental Change shall be canceled at the
time of, or immediately prior to, the Fundamental Change, as provided
in the declaration. Notwithstanding the foregoing, no person holding an
Option or a Stock Appreciation Right shall be entitled to the payment
provided for in this Section 17(b) if such Option or Stock Appreciation
Right shall have expired pursuant to the Agreement. For purposes of
this Section only, "Fair Market Value" per Share shall mean the cash
plus the fair market value, as determined in good faith by the
Committee, of the non-cash consideration to be received per Share by
the shareholders of the Company upon the occurrence of the Fundamental
Change, notwithstanding anything to the contrary provided in the Plan.
18. Forfeitures. An Agreement may provide that in the event a
Participant has received or been entitled to payment of cash, delivery of
Shares, or a combination thereof pursuant to an Award within six months prior to
the Participant's termination of employment with the Company and its Affiliates,
the Committee, in its sole discretion, may require the Participant to return or
forfeit the cash and/or Shares received with respect to the Award (or its
economic value as of (i) the date of the exercise of Options or Stock
Appreciation Rights, (ii) the date of, and immediately following, the lapse of
restrictions on Restricted Stock or the receipt of Shares without restrictions,
or (iii) the date on which the right of the Participant to payment with respect
to Performance Units vests, as the case may be) in the event of certain
occurrences specified in the Agreement. The Committee's right to require
forfeiture must be exercised within 90 days after discovery of such an
occurrence but in no event later than 15 months after the Participant's
termination of employment with the Company and its Affiliates. The occurrences
may, but need not, include competition with the Company or any Affiliate,
unauthorized disclosure of material proprietary information of the Company or
any Affiliate, a violation of applicable business ethics policies of the Company
or Affiliate or any other occurrence specified in the Agreement within the
period or periods of time specified in the Agreement.
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19. Corporate Mergers, Acquisitions, Etc. The Committee may also
grant Options, Stock Appreciation Rights, Restricted Stock or other Awards under
the Plan having terms, conditions and provisions that vary from those specified
in this Plan provided that any such awards are granted in substitution for, or
in connection with the assumption of, existing options, stock appreciation
rights, restricted stock or other award granted, awarded or issued by another
corporation and assumed or otherwise agreed to be provided for by the Company
pursuant to or by reason of a transaction involving a corporate merger,
consolidation, acquisition of property or stock, separation, reorganization or
liquidation to which the Company or a subsidiary is a party.
20. Unfunded Plan. The Plan shall be unfunded and the Company shall
not be required to segregate any assets that may at any time be represented by
Awards under the Plan. Neither the Company, its Affiliates, the Committee, nor
the Board of Directors shall be deemed to be a trustee of any amounts to be paid
under the Plan nor shall anything contained in the Plan or any action taken
pursuant to its provisions create or be construed to create a fiduciary
relationship between the Company and/or its Affiliates, and a Participant or
Successor or Transferee. To the extent any person acquires a right to receive an
Award under the Plan, this right shall be no greater than the right of an
unsecured general creditor of the Company.
21. Limits of Liability.
(a) Any liability of the Company to any Participant with
respect to an Award shall be based solely upon contractual obligations
created by the Plan and the Award Agreement.
(b) Except as may be required by law, neither the Company nor
any member of the Board of Directors or of the Committee, nor any other
person participating in any determination of any question under the
Plan, or in the interpretation, administration or application of the
Plan, shall have any liability to any party for any action taken, or
not taken, in good faith under the Plan.
22. Compliance with Applicable Legal Requirements. No certificate
for Shares distributable pursuant to this Plan shall be issued and delivered
unless the issuance of the certificate complies with all applicable legal
requirements including, without limitation, compliance with the provisions of
applicable state securities laws, the Securities Act of 1933, as amended and in
effect from time to time or any successor statute, the Exchange Act and the
requirements of the exchanges on which the Company's Shares may, at the time, be
listed.
23. Deferrals and Settlements. The Committee may require or permit
Participants to elect to defer the issuance of Shares or the settlement of
Awards in cash under such rules and procedures as it may establish under the
Plan. It may also provide that deferred settlements include the payment or
crediting of interest on the deferral amounts.
24. Other Benefit and Compensation Programs. Payments and other
benefits received by a Participant under an Award made pursuant to the Plan
shall not be deemed a part of a Participant's regular, recurring compensation
for purposes of the termination, indemnity or severance pay laws of any country
and shall not be included in, nor have any effect on, the determination of
benefits under any other employee benefit plan, contract or similar arrangement
provided by the Company or an Affiliate unless expressly so provided by such
other plan, contract or arrangement, or unless the Committee expressly
determines that an Award or portion of an Award should be included to accurately
reflect competitive compensation practices or to recognize that an Award has
been made in lieu of a portion of competitive cash compensation.
25. Beneficiary Upon Participant's Death. To the extent that the
transfer of a Participant's Award at his or her death is permitted under an
Agreement, a Participant's Award shall be transferable at death to the estate or
to the person who acquires the right to succeed to the Award by bequest or
inheritance.
26. Change in Control Payments.
(a) Notwithstanding the provisions of Plan Section 17 above,
if any Award, either alone or together with other payments in the
nature of compensation to a Participant that are contingent on a change
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<PAGE> 16
in the ownership or effective control of the Company or in the
ownership of a substantial portion of the assets of the Company or
otherwise, would result in any portion thereof being subject to an
excise tax imposed under Code Section 4999, or any successor provision,
or would not be deductible in whole or in part by the Company, an
affiliate of the Company (as defined in Code Section 1504, or any
successor provision), or other person making such payments as a result
of Code Section 280G, or any successor provision, such Award and/or
such other benefits and payments shall be reduced (but not below zero)
to the largest aggregate amount as will result in no portion thereof
being subject to such an excise tax or being not so deductible.
(b) For purposes of Plan Section 26(a), (i) no portion of
payments the receipt or enjoyment of which a Participant shall have
effectively waived in writing prior to the date of distribution of an
Award shall be taken into account; (ii) no portion of such Award,
benefits and other payments shall be taken into account that in the
opinion of tax counsel selected by the Company's independent auditors
and acceptable to the Participant does not constitute a "parachute
payment" within the meaning of Code Section 280G(b)(2), or any
successor provision; and (iii) the value of any non-cash benefit or any
deferred payment or benefit included in such payment shall be
determined by the Company's independent auditors in accordance with the
principles of Code Sections 280G(d)(3) and (4) or any successor
provisions;
(c) Any Award not paid as a result of this Plan Section 26 or
reduced to zero as a result of the limitations imposed hereby, shall
remain outstanding in full force and effect in accordance with the
other terms and provisions of this Plan.
27. Requirements of Law.
(a) To the extent that Federal laws do not otherwise control,
the Plan and all determinations made and actions taken pursuant to the
Plan shall be governed by the laws of Minnesota without regard to its
conflicts of law principles and construed accordingly.
(b) In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity
shall not effect the remaining parts of the Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had not
been included.
28. Termination of Other Plan. Effective upon the approval of the
Plan by the Company's shareholders on January 22, 1997, the Company's 1994
Omnibus Stock Plan and the Company's Directors' Nonstatutory Stock Option Plan
("Prior Plans") terminated. Thereafter, all grants and awards made under the
Prior Plans prior to the approval by the shareholders shall continue in
accordance with the terms of the Prior Plans.
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EXHIBIT 99.2
FSI INTERNATIONAL, INC.
EMPLOYEES STOCK PURCHASE PLAN
(as amended January 2000)
Section 1. Establishment and Purpose
1.1 Establishment. FSI International, Inc., a Minnesota corporation,
(hereinafter called "FSI" or the "Company"), hereby establishes a stock purchase
plan for employees as described herein, which shall be known as the FSI
INTERNATIONAL, INC. EMPLOYEES STOCK PURCHASE PLAN (hereinafter called the
"Plan").
1.2 Purpose. The purpose of this Plan is to permit employees to purchase
Stock from FSI at the price specified in Section 5. The Plan is intended to be
an "employee stock purchase plan" under Section 423 of the Internal Revenue Code
of 1986, as amended (the "Code"), and shall be interpreted and administered in a
manner consistent with such intent.
Section 2. Definitions
2.1 Definitions. Whenever used hereinafter, the following terms shall have
the meanings set forth below:
(a) "Affiliate" means any corporation, a majority of the voting stock of
which is directly or indirectly owned by FSI and whose participation in the Plan
the Board has expressly approved.
(b) "Base Earnings" means a Participant's regular rate of pay including
sick pay, vacation pay, retro pay, overtime, on-call pay, shift differential and
short-term disability, but excluding incentive, discretionary, or signing
bonuses, commissions, foreign service premiums, relocation, expatriate or auto
allowances, and amounts payable under employee benefit plans.
(c) "Board" means the Board of Directors of FSI.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means a committee of at least three persons appointed by
the Board empowered to take actions as stated in this Plan. Each member of the
Committee will remain a member for the duration of the Plan, unless such member
resigns or is removed earlier by majority vote of the Board.
(f) "Eligible Employee" means a person who is an Employee on the fifteenth
day of the month immediately preceding the first day of a Purchase Period.
(g) "Employee" means any employee (including officers and directors who are
also employees) of FSI or its Affiliates.
(h) "Fair Market Value" of a share of Stock as of any date is the mean
between the high and low prices of a share of Stock on said date as published in
the Wall Street Journal, or, if no such prices are published for said date, on
the last preceding day for which such prices are published, or, if the Company's
Stock is listed on a national securities exchange or traded in the national
market system, the mean between the high and low sale prices for such Stock on
such exchange or market on said date, or, if no sale has been made on such
exchange or market on said date, on the last preceding day on which any such
sale shall have been made.
(i) "Interest" means interest as determined pursuant to Section 5.2.
(j) "Participant" means an Eligible Employee who has elected to participate
in the Plan pursuant to Section 4.1.
<PAGE> 2
(k) "Purchase Period" means a six-month period beginning on January 1 or
July 1 of each calendar year.
(l) "Stock" means the common stock, no par value, of FSI.
Section 3. Stock Subject to the Plan
3.1 Number. The total number of shares of Stock available for distribution
under this Plan shall not exceed 1,800,000. These shares may consist, in whole
or in part, of authorized but unissued Stock not reserved for any other purpose.
3.2 Adjustment in Capitalization. In the event of any change in the
outstanding shares of Stock by reason of a Stock dividend or split, combination,
recapitalization, or reclassification, the shares of Stock issuable and the
price payable therefor under this Plan shall be appropriately adjusted by the
Committee, whose determination shall be conclusive. Except as provided above, no
adjustment shall be made in connection with the issuance by FSI of any Stock or
any warrants, rights, or options to acquire shares of Stock or of securities
convertible into Stock.
Section 4. Participation
4.1 Participation. An Eligible Employee may elect to become a Participant
on the first day of any Purchase Period, provided such Participant was an
Eligible Employee on the day immediately preceding the first day of such
Purchase Period. Any election to participate shall be made in accordance with
rules adopted by the Committee. However, in no event shall an Eligible Employee
be granted the right to purchase Stock under the Plan if after the purchase such
Eligible Employee would own stock of FSI possessing 5% or more of the total
combined voting power or value of all classes of stock of FSI. Also, an Eligible
Employee may not become or remain a Participant at any time when such Eligible
Employee owns stock possessing 5% or more of the total combined voting power or
value of all classes of stock of FSI. For purposes of this subsection, the rules
of Section 424(d) of the Code shall apply in determining the stock ownership of
an individual, and stock which an employee may purchase under outstanding
options shall be treated as stock owned by the employee.
Section 5. Purchase of Stock
5.1 Contributions for Purchase of Stock. At the time an Eligible Employee
elects to become a Participant in the Plan, such Eligible Employee shall also
elect the form and manner of contributing funds for the purchase of Stock. A
Participant may elect to contribute funds for the purchase of Stock by directing
his or her employer to withhold any whole percentage less than or equal to 10%
of his or her Base Earnings for the purpose of purchasing Stock from FSI. In no
event shall the aggregate contributions for the purchase of Stock exceed 10% of
a Participant's Base Earnings. A Participant may modify the rate of withholding
from such Participant's Base Earnings only in accordance with the following:
(a) A Participant may at any time direct reduction of the rate of
withholding to a rate lower than that previously in effect. However, only one
such direction to continue withholding at a rate lower than that previously in
effect may be made in any one Purchase Period.
(b) A Participant may at any time direct discontinuance of withholding. If
a Participant directs discontinuance of withholding, such Participant may direct
resumption of withholding only as of the first day of any subsequent Purchase
Period.
(c) Except as provided in subsection (a) or (b) above, a Participant may
direct modification of the rate of withholding only as of the first day of any
Purchase Period. The modified rate may be any whole percentage less than or
equal to 10% of the Participant's Base Earnings. Unless otherwise elected by the
Participant, the rate of withholding such Participant has elected will remain in
effect for subsequent Purchase Periods.
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<PAGE> 3
Any election or direction under this section shall be made in writing pursuant
to rules adopted by the Committee, and shall become effective at a time
specified by the Committee.
5.2 Disposition of Contributions. Amounts withheld pursuant to Section 5.1
shall be held by the employer until the end of the Purchase Period during which
they were withheld, subject to the following:
(a) A Participant who elects pursuant to Section 5.1(b) to discontinue
withholding may at any time withdraw all or any part of the amounts previously
withheld or otherwise contributed. Any such withdrawal shall be paid to the
Participant by his or her employer in cash, with Interest.
(b) During the last calendar month of each Purchase Period, each
Participant shall be permitted to elect to have all or any part of the amounts
withheld paid to such Participant in cash with Interest.
(c) Any withdrawal under (a) or (b) above shall be deemed to be on a
first-in-first-out basis. Interest shall be applied to the average amount in the
Participant's account at the end of each full calendar month during the
completed portion of the Purchase Period. Prior to the first day of any Purchase
Period, the Committee shall determine the rate of Interest with respect to such
Purchase Period. The Committee shall give such publicity to said Interest rate
as it deems appropriate.
(d) Any portion of the amounts withheld that is not paid to the Participant
in cash shall be automatically applied to purchase Stock under Section 5.3.
(e) Any election or direction under this section shall be made in writing
pursuant to rules adopted by the Committee.
5.3 Purchases of Stock. Amounts withheld from a Participant during a
Purchase Period (except any amounts refunded to such Participant in cash under
Section 5.2) shall be used as of the last business day of such Purchase Period
to purchase Stock from FSI for a price equal to the lesser of (a) or (b).
(a) 85% of the Fair Market Value of a share of Stock on the first business
day of the Purchase Period.
(b) 85% of the Fair Market Value of a share of Stock on the last business
day of the Purchase Period.
5.4 Issuance of Stock. Promptly after the end of each Purchase Period, a
certificate for the number of shares of Stock purchased by all Participants
shall be issued and delivered to an agent selected by the Company. The agent
will hold such certificate for the benefit of all Participants who have
purchased shares of Stock and will maintain an account for each Participant
reflecting the number of shares (including fractional shares) credited to the
account of each Participant. Each Participant will be entitled to direct the
voting of all shares credited to such Participant's account by the agent and may
also direct the agent to sell such shares and distribute the net proceeds of the
sale to the Participant. At any time, a Participant may either request that the
agent transfer the shares of Stock credited to the Participant's account to
another custodian or request from the agent a physical certificate representing
the shares of Stock credited to the Participant's account; provided, however,
that the agent shall not be required to issue a certificate representing a
fractional share and may instead pay the Participant a cash amount representing
the fair market value of such fractional share.
5.5 Privileges of a Stockholder. A Participant shall not have stockholder
privileges with respect to any Stock until the date of issuance of a certificate
to such Participant for such Stock.
5.6 Limitation On Stock Purchases. As required by Section 423 of the Code,
no Participant may purchase Stock under this Plan and all other employee stock
purchase plans of the Company and its Affiliates at a rate in excess of $25,000
in Fair Market Value of such Stock (determined at the time the option to
purchase Stock is granted) for each calendar year in which any such option to
purchase Stock granted to such Participant is
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outstanding at any time. Notwithstanding the foregoing, the Fair Market Value
(determined on the first day of any Purchase Period) of shares of Stock that may
be purchased by a Participant during such Purchase Period shall not exceed the
excess, if any, of (i) $25,000 over (ii) the Fair Market Value (determined on
the first day of the relevant Purchase Period) of shares of Stock previously
acquired by the Participant in any prior Purchase Period during such calendar
year.
Section 6. Termination of Employment
6.1 Termination of Employment. A Participant whose termination of
employment occurs more than three months prior to the close of a Purchase Period
will not be eligible to purchase any shares of Stock pursuant to this Plan with
respect to such Purchase Period. Any amount withheld from such a Participant
during the Purchase Period in which his or her termination of employment occurs
shall be paid to such Participant in cash with Interest calculated under Section
5.2(c) promptly after such Participant's termination of employment. Any
Participant whose termination of employment occurs within three months prior to
the last day of a Purchase Period may direct Stock purchases or withdrawals with
respect to that Purchase Period pursuant to Sections 5.2 and 5.3. However, if a
Participant's death occurred at any time during the Purchase Period, any amount
withheld from the Participant during such Purchase Period shall be paid to the
Participant's personal representative in cash with Interest determined under
Section 5.2(c), and no portion thereof shall be applied to purchase Stock.
Section 7. Rights of Employees; Participants
7.1 Employment. Nothing in this Plan shall interfere with or limit in any
way the right of FSI or any of its Affiliates to terminate any Employee's,
Eligible Employee's, or Participant's employment at any time, nor confer upon
any such person any right to continue in the employ of FSI or any of its
Affiliates.
7.2 Nontransferability. No right or interest of any Participant in this
Plan shall be assignable or transferable, or subject to any lien, directly or
indirectly, by operation of law, or otherwise, including execution, levy,
garnishment, attachment, pledge, or bankruptcy. Any attempted assignment,
transfer, pledge or other disposition of any rights under the Plan shall be null
and void, and shall automatically terminate all rights of a Participant under
the Plan.
Section 8. Administration
8.1 Administration. The Committee shall be responsible for the
administration of the Plan. The Committee, by majority action thereof, is
authorized to interpret the Plan, to prescribe, amend, and rescind rules and
regulations relating to the Plan, to provide for conditions and assurances
deemed necessary or advisable to protect the interests of FSI, and to make all
other determinations necessary or advisable for the administration of the Plan,
but only to the extent not contrary to the express provisions of the Plan. The
determination of the Committee, interpretation or other action made or taken
pursuant to the provisions of the Plan shall be final, and shall be binding and
conclusive for all purposes and upon all persons.
Section 9. Amendment, Modification, and Termination of Plan
9.1 Amendment, Modification, and Termination of the Plan. The Board, upon
recommendation of the Committee, at any time may terminate, and at any time and
from time to time and in any respect, may amend or modify the Plan, provided,
however, that no such action of the Board, without approval of the stockholders
of FSI, may:
(a) increase the total amount of Stock that may be awarded under the Plan,
except as provided in Section 3.2 of the Plan;
(b) change the class of Employees eligible to participate in the Plan;
(c) withdraw the administration of the Plan from the Committee;
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(d) permit any person, while a member of the Committee, to be eligible to
participate in the Plan; or
(e) extend the duration of the Plan.
Section 10. Requirements of Law
10.1 Requirements of Law. The issuance of Stock and the payment of cash
pursuant to this Plan shall be subject to all applicable laws, rules, and
regulations, and shares of Stock shall not be issued nor cash payments made
except upon approval of proper government agencies or stock exchanges as may be
required.
10.2 Governing Law. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of Minnesota.
Section 11. Effective Date of the Plan
11.1 Effective Date. The Plan, as amended, is effective as of January 1,
2000.
11.2 Duration of the Plan. Unless the Board terminates the Plan earlier, the
Plan shall remain in effect until all Stock subject to it shall be distributed
pursuant to the Plan.
5
