AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 3, 2000
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------
CONSYGEN, INC.
(Exact Name of Registrant as Specified in its Charter)
TEXAS 76-0260145
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
125 SOUTH 52ND STREET, TEMPE, AZ 85281, (480-394-9100)
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
----------
CONSYGEN, INC. 2000 COMBINATION STOCK OPTION PLAN
-------------------------------------------------
(Full title of Plans)
----------
A. LEWIS BURRIDGE
PRESIDENT AND CHIEF EXECUTIVE OFFICER
125 SOUTH 52ND STREET, TEMPE, AZ 85281
(480) 394-9100
(Name, Address and Telephone Number,
Including Area Code, of Agent for Service)
WITH A COPY TO:
JOHN G. NOSSIFF, JR., ESQ.
BROWN, RUDNICK, FREED & GESMER
ONE FINANCIAL CENTER, BOSTON, MASSACHUSETTS 02111
(617) 856-8200
----------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==============================================================================================
Proposed Proposed
Amount Maximum Maximum Amount of
Title of Each Class of to Be Offering Price Aggregate Registration
Securities to Be Registered Registered Per Share(1) Offering Price(1) Fee
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.003 par value 5,000,000 $1.234 $6,170,000 $1,629
==============================================================================================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457 under the Securities Act of 1933, on the basis of the average
of the high and low reported price of the Common Stock as reported on the
National Association of Securities Dealers OTC Bulletin Board on May 1,
2000.
(2) Such presently indeterminable number of additional shares of Common Stock
are also registered hereunder as may be issued in the event of a merger,
consolidation, reorganization, recapitalization, stock dividend, stock
split or other similar change in Common Stock.
================================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents are hereby incorporated by reference into this
Registration Statement:
(a) The Registrant's Annual Report on Form 10-KSB, Form 10-KSB/A and Form
10-KSB/A2 for the fiscal year ended May 31, 1999 filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act");
(b) All other reports of the Registrant filed pursuant to Section 13(a) or
15(d) of the Exchange Act since the end of the fiscal year covered by
the Registrant's documents referred to paragraph (a) above; and
(c) The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A, as amended by
Amendment No. 1 thereto (Registration No. 0-17598), filed under the
Exchange Act with the Securities and Exchange Commission.
All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act subsequent to the date hereof and prior
to the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining unsold
shall be deemed to be incorporated by reference in this Registration Statement
and to be a part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's Articles of Incorporation, as amended (the "Amended
Articles"), eliminate, subject to certain exceptions, the personal liability of
directors to the Registrant or its stockholders for monetary damages for
breaches of fiduciary duties as directors to the extent permitted by state law.
The Amended Articles do not provide for the elimination of, or any limitation
on, the personal liability of a director (i) for a breach of the director's duty
of loyalty, (ii) engaged in a transaction from which he receives an improper
benefit, (iii) for intentional misconduct or knowing violation of law, (iv)
found not to have acted in good faith, (v) engaged in an act related to an
<PAGE>
unlawful stock repurchase or payment of dividend or (vi) where liability is
prescribed by law. These provisions of the Amended Articles may limit the
remedies available to a stockholder in the event of breaches of any director's
duties to such stockholder or the Registrant.
The Registrant's Amended and Restated Bylaws (the "Amended Bylaws")
include provisions for mandatory indemnification of its officers and directors
to the maximum extent provided under the Texas Business Corporation Act
("TBCA"). To the extent permitted under the TBCA, the Amended Bylaws provide
that no officer or director shall be liable to the Company for any action taken
or omitted to be taken by him as a director or officer if such person (i)
exercised the same degree of care and skill as a prudent person would have
exercised under similar circumstances or (ii) took or omitted to take such
action in reliance upon advice of counsel for the Company or upon statements
made or information furnished by directors, officers, employees, or agents of
the Company, which he had no reasonable grounds to disbelieve. In addition, the
Amended Bylaws provide that directors and officers shall be paid or reimbursed,
to the fullest extent provided under the TBCA, for reasonable expenses incurred
by such director or officer in connection with certain proceedings, in advance
of the final disposition of such proceeding.
Article 2.02-1 of the TBCA generally permits a corporation to
indemnify a person who was, is, or is threatened to be a named defendant or
respondent in a proceeding because the person was or is a director or officer if
it is determined that such person (1) conducted himself in good faith; (2)
reasonably believed (a) in the case of conduct in his official capacity as a
director or officer of the corporation, that his conduct was in the
corporation's best interests, or (b) in the case of other situations, that his
conduct was at least not opposed to the corporation's best interests; and (3) in
the case of any criminal proceeding, had no reasonable cause to believe his
conduct was unlawful. In addition, the TBCA requires a corporation to indemnify
a director or officer for any action that such director or officer successfully
defended on the merits.
The Registrant has entered into indemnification agreements with each
of its directors and officers. The indemnification agreements provide that the
Registrant will pay certain amounts incurred by a director or officer in
connection with any civil or criminal action or proceeding and specifically
including actions by or in the name of the Registrant (derivative suits) where
the individual's involvement is by reason of the fact that he is or was a
director or officer. Such amounts include, to the maximum extent permitted by
law, attorney's fees, judgments, civil or criminal fines, settlement amounts and
other expenses customarily included in connection with legal proceedings. Under
the indemnification agreements, a director or officer will not receive
indemnification if he is found not to have acted in good faith in the reasonable
belief that his action was in the best interests of the Registrant.
The Registrant has also purchased and maintains director's and
officer's liability insurance for each of its officers and directors.
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
Number Description
- ------ -----------
4.1* Specimen Common Stock Certificate (Filed as Exhibit 4.B to the
Registrant's Registration Statement on Form S-8 (File No.
33-22900-FW)).
5** Legal Opinion of Brown, Rudnick, Freed & Gesmer.
23.1** Consent of Brown, Rudnick, Freed & Gesmer (contained in its opinion
filed as Exhibit 5).
23.2** Consent of King, Weber & Associates, P.C.
23.3** Consent of Wolinetz, Gottlieb & Lafazan, P.C.
24** Power of Attorney (included on the Signature Page of this Registration
Statement).
99.1** ConSyGen, Inc. 2000 Combination Stock Option Plan.
- ----------
* Not filed herewith. In accordance with Rule 411 promulgated pursuant to the
Securities Act, reference is made to the documents previously filed with
the Commission, which are incorporated by reference herein.
** Filed herewith.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement 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 this Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each 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 the time shall be deemed to be the initial bona
fide offering thereof.
<PAGE>
(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.
(b) 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 Securities 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.
(c) 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 Registrant's Amended Articles of Incorporation,
Amended and Restated By-Laws, or otherwise, the Registrant has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act
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, 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.
<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, as amended, 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 Tempe, Arizona, on April
12, 2000.
CONSYGEN, INC.
By: /s/ A. Lewis Burridge
-----------------------------------
A. LEWIS BURRIDGE, PRESIDENT
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints A. Lewis Burridge and Jason Genet, and
each of them (with full power to each of them to act alone), his true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto
and other 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 their
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Robert L. Stewart Chairman of the Board April 12, 2000
- -----------------------
Robert L. Stewart
/s/ A. Lewis Burridge President, Chief Executive April 12, 2000
- ----------------------- Officer and Director
A. Lewis Burridge (Principal Executive Officer)
/s/ Eric J. Strasser Vice President and Chief Financial April 12, 2000
- ----------------------- Officer (Principal Financial
Eric J. Strasser Officer)
/s/ Andrew Lee Director April 12, 2000
- -----------------------
Andrew Lee
/s/ John L. Caldwell Director April 12, 2000
- -----------------------
John L. Caldwell
/s/ Donald P. Knode Director April 12, 2000
- -----------------------
Donald P. Knode
<PAGE>
EXHIBIT INDEX
Exhibit Sequential
Number Page No.
- ------ ----------
4.1 Specimen Common Stock Certificate (Filed as Exhibit 4.B to *
the Registrant's Registration Statement on Form S-8 (File
No. 33-22900-FW)).
5 Legal Opinion of Brown, Rudnick, Freed & Gesmer. **
23.1 Consent of Brown, Rudnick, Freed & Gesmer (contained in its **
opinion filed as Exhibit 5).
23.2 Consent of King, Weber & Associates, P.C. **
23.3 Consent of Wolinetz, Gottlieb & Lafazan, P.C. **
24 Power of Attorney (included on the Signature Page of this **
Registration Statement).
99.1 ConSyGen, Inc. 2000 Combination Stock Option Plan. **
- ----------
* Not filed herewith. In accordance with Rule 411 promulgated pursuant to the
Securities Act of 1933, reference is made to the documents previously filed
with the Commission, which are incorporated by reference herein.
** Filed herewith.
May 3, 2000
ConSyGen, Inc.
125 South 52nd Street
Suite 140
Tempe, AZ 85281
Re: ConSyGen, Inc., a Texas corporation
Registration Statement on Form S-8
Gentlemen:
We are counsel for ConSyGen, Inc., a Texas corporation (the
"Company"). We have been asked to deliver this opinion in connection with the
preparation and filing with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "Act"), of a Registration Statement on
Form S-8 (the "Registration Statement") relating to an aggregate of 5,000,000
shares of the Company's Common Stock, $.003 par value per share (the "Shares").
This opinion letter, together with Schedule A attached hereto (this "Opinion
Letter"), is being rendered in connection with the filing of the Registration
Statement.
The 5,000,000 Shares covered by the Registration Statement are
issuable under the Company's 2000 Combination Stock Option Plan (referred to
herein as the "Plan").
In connection with this Opinion Letter, we have examined and are
familiar with originals or copies, certified or otherwise identified to our
satisfaction, of the following documents (collectively, the "Documents"):
1. a certificate from the Secretary of State of the State of Texas
dated March 28, 2000 as to the legal existence and good standing of the Company;
2. a copy of the Articles of Incorporation of the Company, as amended
to date, and a certificate of the Secretary that there have been no further
amendments thereto;
3. a copy of the Amended and Restated By-laws of the Company,
certified by the Secretary of the Company as presently being in effect;
4. certain proceedings of the directors of the Company relative to the
Plan and Options granted under the Plan;
5. the Plan;
<PAGE>
6. a letter of recent date from the Company's transfer agent as to the
issued and outstanding shares of the Company's Common Stock, $.003 par value per
share;
7. a representation letter dated April 12, 2000 from the Company and
Howard R. Baer regarding consulting services provided to the Company by Mr.
Baer; and
8. the Registration Statement.
We have assumed, for the purposes of our opinion herein, that any
conditions to the issuance of the Shares under the Plan have been or will be
satisfied in full.
We have, without independent investigation, relied upon the
representations and warranties of the various parties as to matters of objective
fact contained in the Documents.
In addition, this Firm, in rendering legal opinions, customarily makes
certain assumptions which are described in Schedule A hereto. In the course of
our representation of the Company in connection with the preparation of the
Registration Statement, nothing has come to our attention which causes us to
believe reliance upon any of these assumptions is inappropriate, and, with your
concurrence, the opinion hereafter expressed is based upon those assumptions.
The Enumerated Party referred to in Schedule A is the Company.
We have not made any independent review or investigation of orders,
judgments, rules or other regulations or decrees by which the Company or any of
its property may be bound, nor have we made any independent investigation as to
the existence of actions, suits, investigations or proceedings, if any, pending
or threatened against the Company.
With your concurrence, our opinion hereafter expressed is based solely
upon (1) our review of the Documents, (2) discussions with those of our
attorneys who have devoted substantive attention to the preparation of the
Registration Statement, and (3) such review of published sources of law as we
have deemed necessary.
Our opinions contained herein are limited to the laws of the
Commonwealth of Massachusetts and the Federal law of the United States of
America. To the extent that the Plan or any agreement issued thereunder provides
that it should be governed by the laws of any jurisdiction other than the
Commonwealth of Massachusetts, our opinion regarding the Shares is being
rendered as if only the internal laws of the Commonwealth of Massachusetts were
applicable thereto, notwithstanding the governing law provisions of the Plan,
any agreement issued thereunder to the contrary or that the Company is a Texas
corporation.
We express no legal opinion upon any matter other than that explicitly
addressed below, and our express opinion therein contained shall not be
interpreted to be an implied opinion upon any other matter.
<PAGE>
Based upon and subject to the foregoing, we are of the opinion that
the issuance of the Shares has been duly authorized and, when issued and paid
for in accordance with the terms and conditions of the Plan, the Shares will be
validly issued, fully paid, and non-assessable.
We hereby consent to the reference to this firm in the Registration
Statement and to the filing of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
BROWN, RUDNICK, FREED & GESMER, P.C.
By: /s/ John G. Nossiff, Jr.
-----------------------------------
John G. Nossiff, Jr., a Member
JGN:SRL:MSG
<PAGE>
SCHEDULE A
BROWN, RUDNICK, FREED & GESMER
STANDARD ASSUMPTIONS
In rendering legal opinions, Brown, Rudnick, Freed & Gesmer makes
certain customary assumptions described below:
1. Each natural person executing any of the Documents has sufficient legal
capacity to enter into such Documents.
2. Each Document is accurate, complete and authentic, each original is
authentic, each copy conforms to an authentic original and all signatures
are genuine.
3. All official public records are accurate, complete and properly indexed and
filed.
4. There has not been any mutual mistake of fact or misunderstanding, fraud,
duress, or undue influence by or among any of the parties to the Documents.
5. The conduct of the parties to the Documents has complied in the past and
will comply in the future with any requirement of good faith, fair dealing
and conscionability.
6. The Enumerated Party will obtain all permits and governmental approvals
required in the future and take all actions similarly required relevant to
its performance of its obligations under the Documents.
7. All parties to or bound by the Documents will act in accordance with, and
will refrain from taking any action that is forbidden by, the terms and
conditions of the Documents.
8. There are no agreements or understandings among the parties to or bound by
the Documents, and there is no usage of trade or course of prior dealing
among such parties, that would define, modify, waive, or qualify the terms
of any of the Documents.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement on Form S-8 pertaining to the ConSyGen, Inc. 2000 Combination Stock
Option Plan of our report dated August 5, 1999 (except for Note 12, as to which
the date is November 3, 1999) with respect to our audit of the consolidated
financial statements of ConSyGen, Inc. (a Texas corporation) included in its
Annual Report on Form 10-KSB and Form 10-KSB/A as of May 31, 1999 and for the
year then ended May 31, 1999, filed with the Securities and Exchange Commission.
/s/ King, Weber & Associates, P.C.
Phoenix, Arizona
May 2, 2000
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement on
Form S-8 pertaining to the ConSyGen, Inc. 2000 Combination Stock Option Plan of
our report dated July 17, 1998 with respect to the consolidated statements of
operations, changes in stockholders' equity (deficit) and cash flows for the
year ended May 31, 1998 of ConSyGen, Inc. (a Texas corporation) included in its
Annual Report on Form 10-KSB/A2 for the year ended May 31, 1999, filed with the
Securities and Exchange Commission.
/s/ WOLINETZ, GOTTLIEB & LAFAZAN, P.C.
Rockville Centre, New York
May 3, 2000
CONSYGEN, INC.
2000 COMBINATION STOCK OPTION PLAN
SECTION I. PURPOSE OF THE PLAN.
The purposes of this ConSyGen, Inc. 2000 Combination Stock Option Plan
(the "2000 Plan") are (i) to provide long-term incentives and rewards to those
key employees (the "Employee Participants") of ConSyGen, Inc., a Texas
corporation (the "Corporation"), and its subsidiaries (if any), and any other
persons (the "Non-employee Participants") who are in a position to contribute to
the long-term success and growth of the Corporation and its subsidiaries, (ii)
to assist the Corporation in retaining and attracting executives and key
employees with requisite experience and ability, and (iii) to associate more
closely the interests of such executives and key employees with those of the
Corporation's stockholders.
SECTION II. DEFINITIONS.
"Code" is the Internal Revenue Code of 1986, as it may be amended from
time to time.
"Common Stock" is the common stock, $.003 par value, of the
Corporation.
"Committee" is defined in Section III, paragraph (a).
"Corporation" is defined in Section I.
"Corporation ISOs" are all stock options (including 2000 Plan ISOs)
which (i) are Incentive Stock Options and (ii) are granted under any plans
(including this 2000 Plan) of the Corporation, a Parent Corporation and/or a
Subsidiary Corporation.
"Employee Participants" is defined in Section I.
"Fair Market Value" of any property is the value of the property as
reasonably determined by the Committee.
"Incentive Stock Option" is a stock option which is treated as an
incentive stock option under Section 422 of the Code.
"2000 Plan" is defined in Section I.
<PAGE>
"2000 Plan ISOs" are Stock Options which are Incentive Stock Options.
"Non-employee Participants" is defined in Section I.
"Non-qualified Option" is a Stock Option which does not qualify as an
Incentive Stock Option or for which the Committee provides, in the terms of such
option and at the time such option is granted, that the option shall not be
treated as an Incentive Stock Option.
"Parent Corporation" has the meaning provided in Section 424(e) of the
Code.
"Participants" are all persons who are either Employee Participants or
Non-employee Participants.
"Permanent and Total Disability" has the meaning provided in Section
22(e)(3) of the Code.
"Rule 16b-3" means Securities and Exchange Commission Rule 16b-3.
"Section 16" means Section 16 of the Securities Exchange Act of 1934,
as amended, or any similar or successor statute, and any rules, regulations, or
policies adopted or applied thereunder.
"Stock Options" are rights granted pursuant to this 2000 Plan to
purchase shares of Common Stock at a fixed price.
"Subsidiary Corporation" has the meaning provided in Section 424(f) of
the Code.
"Ten Percent Stockholder" means, with respect to a 2000 Plan ISO, any
individual who directly or indirectly owns stock possessing more than 10% of the
total combined voting power of all classes of stock of the Corporation or any
Parent Corporation or any Subsidiary Corporation at the time such 2000 Plan ISO
is granted.
SECTION III. ADMINISTRATION.
(a) THE COMMITTEE. This 2000 Plan shall be administered by the Board
of Directors or by a compensation committee consisting solely of two or more
"non-employee directors", as defined in Rule 16b-3, who shall be designated by
the Board of Directors of the Corporation (the administering body is hereafter
referred to as the "Committee"). The Committee shall serve at the pleasure of
the Board of Directors, which may from time to time, and in its sole discretion,
<PAGE>
discharge any member, appoint additional new members in substitution for those
previously appointed and/or fill vacancies however caused. A majority of the
Committee shall constitute a quorum and the acts of a majority of the members
present at any meeting at which a quorum is present shall be deemed the action
of the Committee. No person shall be eligible to be a member of the Committee if
that person's membership would prevent the plan from complying with Section 16,
if applicable to the Corporation.
(b) AUTHORITY AND DISCRETION OF THE COMMITTEE. Subject to the express
provisions of this 2000 Plan and provided that all actions taken shall be
consistent with the purposes of this 2000 Plan, and subject to ratification by
the Board of Directors only if required by applicable law, the Committee shall
have full and complete authority and the sole discretion to: (i) determine those
persons who shall constitute key employees eligible to be Employee Participants;
(ii) select the Participants to whom Stock Options shall be granted under this
2000 Plan; (iii) determine the size and the form of the Stock Options, if any,
to be granted to any Participant; (iv) determine the time or times such Stock
Options shall be granted including the grant of Stock Options in connection with
other awards made, or compensation paid, to the Participant; (v) establish the
terms and conditions upon which such Stock Options may be exercised and/or
transferred, including the exercise of Stock Options in connection with other
awards made, or compensation paid, to the Participant; (vi) make or alter any
restrictions and conditions upon such Stock Options and the Stock received on
exercise thereof, including, but not limited to, providing for limitations on
the Participant's right to keep any Stock received on termination of employment;
(vii) determine whether the Participant or the Corporation has achieved any
goals or otherwise satisfied any conditions or requirements that may be imposed
on or related to the exercise of Stock Options; and (viii) adopt such rules and
regulations, establish, define and/or interpret these and any other terms and
conditions, and make all determinations (which may be on a case-by-case basis)
deemed necessary or desirable for the administration of this 2000 Plan.
Notwithstanding any provision of this 2000 Plan to the contrary, only Employee
Participants shall be eligible to receive 2000 Plan ISOs.
(c) APPLICABLE LAW. This 2000 Plan and all Stock Options shall be
governed by the law of the state in which the Corporation is incorporated.
SECTION IV. TERMS OF STOCK OPTIONS.
(a) AGREEMENTS. Stock Options shall be evidenced by a written
agreement between the Corporation and the Participant awarded the Stock Option.
This agreement shall be in such form, and contain such terms and conditions (not
inconsistent with this 2000 Plan) as the Committee may determine. If the Stock
Option described therein is not intended to be an Incentive Stock Option, but
otherwise qualifies as an Incentive Stock Option, the agreement shall include
the following or a similar statement: "This stock option is not intended to be
<PAGE>
an Incentive Stock Option, as that term is described in Section 422 of the
Internal Revenue Code of 1986, as amended."
(b) TERM. Stock Options shall be for such periods as may be determined
by the Committee, provided that in the case of 2000 Plan ISOs, the term of any
such 2000 Plan ISO shall not extend beyond three months after the time the
Participant ceases to be an employee of the Corporation. Notwithstanding the
foregoing, the Committee may provide in a 2000 Plan ISO that in the event of the
Permanent and Total Disability or death of the Participant, the 2000 Plan ISO
may be exercised by the Participant or his estate (if applicable) for a period
of up to one year after the date of such Permanent and Total Disability or
Death. In no event may a 2000 Plan ISO be exercisable (including provisions, if
any, for exercise in installments) subsequent to ten years after the date of
grant, or, in the case of 2000 Plan ISOs granted to Ten Percent Stockholders,
more than five years after the date of grant.
(c) PURCHASE PRICE. The purchase price of shares purchased pursuant to
any Stock Option shall be determined by the Committee, and shall be paid by the
Participant or other person permitted to exercise the Stock Option in full upon
exercise, (i) in cash, (ii) by delivery of shares of Common Stock (valued at
their Fair Market Value on the date of such exercise), (iii) any other property
(valued at its Fair Market Value on the date of such exercise), or (iv) any
combination of cash, stock and other property, with any payment made pursuant to
subparagraphs (ii), (iii) or (iv) only as permitted by the Committee, in its
sole discretion. In no event will the purchase price of Common Stock be less
than the par value of the Common Stock. Furthermore, the purchase price of
Common Stock subject to a 2000 Plan ISO shall not be less than the Fair Market
Value of the Common Stock on the date of the issuance of the 2000 Plan ISO,
provided that in the case of 2000 Plan ISOs granted to Ten Percent Stockholders,
the purchase price shall not be less than 110% of the Fair Market Value of the
Common Stock on the date of issuance of the 2000 Plan ISO.
(d) FURTHER RESTRICTIONS AS TO INCENTIVE STOCK OPTIONS. To the extent
that the aggregate Fair Market Value of Common Stock with respect to which
Corporation ISOs (determined without regard to this section) are exercisable for
the first time by any Employee Participant during any calendar year exceeds
$100,000, such Corporation ISOs shall be treated as options which are not
Incentive Stock Options. For the purpose of this limitation, options shall be
taken into account in the order granted, and the Committee may designate that
portion of any Corporation ISO that shall be treated as not an Incentive Stock
Option in the event that the provisions of this paragraph apply to a portion of
any option, unless otherwise required by the Code or regulations of the Internal
Revenue Service. The designation described in the preceding sentence may be made
at such time as the Committee considers appropriate, including after the
issuance of the option or at the time of its exercise. For the purpose of this
section, Fair Market Value shall be determined as of the time the option with
respect to such stock is granted.
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(e) RESTRICTIONS. At the discretion of the Committee, the Common Stock
issued pursuant to the Stock Options granted hereunder may be subject to
restrictions on vesting or transferability. For the purposes of this limitation,
options shall be taken into account in the order granted.
(f) WITHHOLDING OF TAXES. Pursuant to applicable federal, state, local
or foreign laws, the Corporation may be required to collect income or other
taxes upon the grant of a Stock Option to, or exercise of a Stock Option by, a
holder. The Corporation may require, as a condition to the exercise of a Stock
Option, or demand, at such other time as it may consider appropriate, that the
Participant pay the Corporation the amount of any taxes which the Corporation
may determine is required to be withheld or collected, and the Participant shall
comply with the requirement or demand of the Corporation. In its discretion, the
Corporation may withhold shares to be received upon exercise of a Stock Option
if it deems this an appropriate method for withholding or collecting taxes.
(g) SECURITIES LAW COMPLIANCE. Upon exercise (or partial exercise) of
a Stock Option, the Participant or other holder of the Stock Option shall make
such representations and furnish such information as may, in the opinion of
counsel for the Corporation, be appropriate to permit the Corporation to issue
or transfer Stock in compliance with the provisions of applicable federal or
state securities laws. The Corporation, in its discretion, may postpone the
issuance and delivery of Stock upon any exercise of this Option until completion
of such registration or other qualification of such shares under any federal or
state laws, or stock exchange listing, as the Corporation may consider
appropriate. Furthermore, the Corporation is not obligated to register or
qualify the shares of Common Stock to be issued upon exercise of a Stock Option
under federal or state securities laws (or to register or qualify them at any
time thereafter), and it may refuse to issue such shares if, in its sole
discretion, registration or exemption from registration is not practical or
available. The Corporation may require that prior to the issuance or transfer of
Stock upon exercise of a Stock Option, the Participant enter into a written
agreement to comply with any restrictions on subsequent disposition that the
Corporation deems necessary or advisable under any applicable federal and state
securities laws. Certificates of Stock issued hereunder shall bear a legend
reflecting such restrictions.
(h) RIGHT TO STOCK OPTION. No employee of the Corporation or any other
person shall have any claim or right to be a participant in this 2000 Plan or to
be granted a Stock Option hereunder. Neither this 2000 Plan nor any action taken
hereunder shall be construed as giving any person any right to be retained in
the employ of the Corporation. Nothing contained hereunder shall be construed as
giving any person any equity or interest of any kind in any assets of the
Corporation or creating a trust of any kind or a fiduciary relationship of any
kind between the Corporation and any such person. As to any claim for any unpaid
amounts under this 2000 Plan, any person having a claim for payments shall be an
unsecured creditor.
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(i) INDEMNITY. Neither the Board of Directors nor the Committee, nor
any members of either, nor any employees of the Corporation or any parent,
subsidiary, or other affiliate, shall be liable for any act, omission,
interpretation, construction or determination made in good faith in connection
with their responsibilities with respect to this 2000 Plan, and the Corporation
hereby agrees to indemnify the members of the Board of Directors, the members of
the Committee, and the employees of the Corporation and its parent or
subsidiaries in respect of any claim, loss, damage, or expense (including
reasonable counsel fees) arising from any such act, omission, interpretation,
construction or determination to the full extent permitted by law.
(j) PARTICIPATION BY FOREIGNERS. Without amending this 2000 Plan,
except to the extent required by the Code in the case of Incentive Stock
Options, the Committee may modify grants made to participants who are foreign
nationals or employed outside the United States so as to recognize differences
in local law, tax policy, or custom.
SECTION V. AMENDMENT AND TERMINATION: ADJUSTMENTS UPON CHANGES IN STOCK.
The Board of Directors of the Corporation may at any time, and from
time to time, amend, suspend or terminate this 2000 Plan or any portion thereof,
provided that no amendment shall be made without approval of the Corporation's
stockholders if such approval is necessary to comply with any applicable tax
requirement, any applicable rules or regulations of the Securities and Exchange
Commission, including Rule 16b-3 (or any successor rule thereunder), or the
rules and regulations of any exchange or stock market on which the Corporation's
securities are listed or quoted. Except as provided herein, no amendment,
suspension or termination of this 2000 Plan may affect the rights of a
Participant to whom a Stock Option has been granted without such Participant's
consent. The Committee is specifically authorized to convert, in its discretion,
the unexercised portion of any 2000 Plan ISO granted to an Employee Participant
to a Non-qualified Option at any time prior to the exercise, in full, of such
2000 Plan ISO. If there shall be any change in the Common Stock or to any Stock
Option granted under this 2000 Plan through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split or other change in
the corporate structure of the Corporation, appropriate adjustments may be made
by the Committee (or if the Corporation is not the surviving corporation in any
such transaction, the Board of Directors of the surviving corporation, or its
designee) in the aggregate number and kind of shares subject to this 2000 Plan,
and the number and kind of shares and the price per share subject to outstanding
options, provided that such adjustment does not affect the qualification of any
2000 Plan ISO as an Incentive Stock Option. In connection with the foregoing,
the Committee may issue new Stock Options in exchange for outstanding Stock
Options.
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SECTION VI. SHARES OF STOCK SUBJECT TO THE PLAN.
The number of shares of Common Stock that may be the subject of awards
under this 2000 Plan shall not exceed an aggregate of 5,000,000 shares. Shares
to be delivered under this 2000 Plan may be either authorized but unissued
shares of Common Stock or treasury shares. Any shares subject to an option
hereunder which for any reason terminates, is canceled or otherwise expires
unexercised, and any shares reacquired by the Corporation due to restrictions
imposed on the shares, shares returned because payment is made hereunder in
stock of equivalent value rather than in cash, and/or shares reacquired from a
recipient for any other reason shall, at such time, no longer count towards the
aggregate number of shares which have been the subject of Stock Options issued
hereunder, and such number of shares shall be subject to further awards under
this 2000 Plan, provided, first, that the total number of shares then eligible
for award under this 2000 Plan may not exceed the total specified in the first
sentence of this Section VI, and second, that the number of shares subject to
further awards shall not be increased in any way that would cause this 2000 Plan
or any Stock Option to not comply with Section 16, if applicable to the
Corporation.
SECTION VII. EFFECTIVE DATE AND TERM OF THIS PLAN.
The effective date of this 2000 Plan is April 12, 2000 (the "Effective
Date") and awards under this 2000 Plan may be made for a period of ten years
commencing on the Effective Date. The period during which a Stock Option may be
exercised may extend beyond that time as provided herein.
DATE OF APPROVAL BY BOARD OF DIRECTORS: As of April 12, 2000
