<PAGE>
As filed with the Securities and Exchange Commission on May 10, 2000
REGISTRATION NO. 333 -
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
--------------------
IBIS TECHNOLOGY CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MASSACHUSETTS 04-2987600
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
32 CHERRY HILL DRIVE
DANVERS, MASSACHUSETTS 01923
(978) 777-4247
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
THE IBIS TECHNOLOGY CORPORATION 2000
EMPLOYEE STOCK PURCHASE PLAN
MARTIN J. REID
PRESIDENT AND CHIEF EXECUTIVE OFFICER
IBIS TECHNOLOGY CORPORATION
32 CHERRY HILL DRIVE
DANVERS, MASSACHUSETTS 01923
(978) 777-4247
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF AGENT FOR SERVICE)
--------------------
CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Proposed Proposed
Title of Amount to be maximum maximum
securities to be registered registered(1) offering price aggregate Amount of
per share(2) offering price(2) registration fee
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.008 par value 300,000 $39.469 $11,840,700 $3,126
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The number of shares of common stock, par value $.008 per share ("Common
Stock"), stated above consists of the aggregate number of shares which may
be sold under The Ibis Technology Corporation 2000 Employee Stock Purchase
Plan, (the "Plan"). The maximum number of shares which may be sold under
the Plan is subject to adjustment in accordance with certain anti-dilution
and other provisions of the Plan. Accordingly, pursuant to Rule 416 under
the Securities Act of 1933, as amended (the "Securities Act"), this
Registration Statement covers, in addition to the number of shares stated
above, an indeterminate number of shares which may be subject to grant or
otherwise issuable after the operation of any such anti-dilution and other
provisions.
(2) This calculation is made solely for the purpose of determining the
registration fee pursuant to the provisions of Rule 457(h) under the
Securities Act on the basis of the average of the high and low sale prices
per share of the Common Stock on the Nasdaq National Market as of a date
(May 4, 2000) within 5 business days prior to filing this Registration
Statement.
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
<PAGE>
EXPLANATORY NOTE
In accordance with the instructional Note to Part I of Form S-8 as
promulgated by the Securities and Exchange Commission, the information specified
by Part I of Form S-8 has been omitted from this Registration Statement on Form
S-8 for offers of Common Stock pursuant to the Plan.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the Commission
are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1999;
(b) The Registrant's Current Reports on Form 8-K filed on
February 22, 2000, April 13, 2000 and April 24, 2000; and
(c) The description of the Common Stock contained in the
Registrant's Registration Statement on Form 8-A (File No. 0-23668) filed
under the Securities Exchange Act of 1934, including any amendment or report
filed for the purpose of updating such description.
All reports and other documents filed by the Registrant after the
date hereof pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934 prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be part hereof from the date of
filing of such reports and 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.
Incorporated by reference to the Registrant's Registration Statement
on Form S-1, File No. 333-1174.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
(4.1) Form of Common Stock Certificate incorporated herein by
reference to Exhibit 4.2 to the Registrant's Registration
Statement filed on Form S-1, File No. 333-1174.
II-1
<PAGE>
(4.2) Article 4 of the Restated Articles of Organization of the
Registrant incorporated herein by reference to Exhibit 4.1 to
the Registrant's Registration Statement filed on Form S-1,
File No. 333-1174.
(4.3) Restated Bylaws of the Registrant, incorporated herein by
reference to Exhibit 3.2 to the Registrant's Registration
Statement filed on Form S-1, File No. 333-1174.
(5) Opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo,
P.C. as to the legality of shares being registered.
(23.1) Consent of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo,
P.C. (included in opinion of counsel filed as Exhibit 5).
(23.2) Consent of KPMG LLP.
(24) Power of Attorney to file future amendments (set forth on the
signature page of this Registration Statement).
(99.1) The Ibis Technology Corporation 2000 Employee Stock Purchase
Plan.
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:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually
or in the aggregate, represents a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) (Section
230.424(b) of this chapter) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration Statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
II-2
<PAGE>
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the Registration Statement is on Form S-3 or Form S-8, and
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this 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 of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the 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 Act and will be
governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
THE REGISTRANT. 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 Danvers, Massachusetts on May 10,
2000.
IBIS TECHNOLOGY CORPORATION
By /s/ Martin J. Reid
----------------------------
Martin J. Reid
President and Chief Executive Officer
Each person whose signature appears below constitutes and appoints
Martin J. Reid and Debra L. Nelson, and each of them, his/her true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution in each of them, for him and in his name, place and stead, and
in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement on Form S-8 of Ibis
Technology Corporation, or any other registration statement for the same
offering that is to be effective upon filing pursuant to Rule 462(b) under
the Securities Act of 1933, as amended, 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 or necessary to be done in or about the
premises, as full to all intents and purposes as he or she might or could do
in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents or any of them or their or his/her substitute or substitutes may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Martin J. Reid President, Chief Executive Officer and May 10, 2000
- --------------------- Director (principal executive officer)
Martin J. Reid
/s/ Debra L. Nelson Chief Financial Officer, Treasurer May 10, 2000
- --------------------- and Clerk (principal financial and
Debra L. Nelson accounting officer)
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Geoffrey Ryding Director May 10, 2000
- -----------------------
Geoffrey Ryding, Ph.D.
/s/ Peter H. Rose Director May 10, 2000
- -----------------------
Peter H. Rose, Ph.D.
/s/ Donald F. McGuinness Director May 10, 2000
- ------------------------
Donald F. McGuinness
/s/ Dimitri Antoniadis Director May 10, 2000
- ------------------------
Dimitri Antoniadis
/s/ Robert L. Gable Director May 10, 2000
- ------------------------
Robert L. Gable
/s/ Lamberto Raffaelli Director May 10, 2000
- -------------------------
Lamberto Raffaelli
/s/ Leslie Lewis Director May 10, 2000
- --------------------------
Leslie Lewis
</TABLE>
II-5
<PAGE>
IBIS TECHNOLOGY CORPORATION
INDEX TO EXHIBITS FILED WITH
FORM S-8 REGISTRATION STATEMENT
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- ------------
<S> <C>
(4.1) Form of Common Stock Certificate incorporated herein by
reference to Exhibit 4.2 to the Registrant's Registration
Statement filed on Form S-1, File No. 333-1174.
(4.2) Article 4 of the Restated Articles of Organization of the Registrant
incorporated herein by reference to Exhibit 4.1 to the Registrant's
Registration Statement filed on Form S-1, File No. 333-1174.
(4.3) Restated Bylaws of the Registrant, incorporated herein by reference to
Exhibit 3.2 to the Registrant's Registration Statement filed on Form S-1,
File No. 333-1174.
(5) Opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. as to the
legality of shares being registered.
(23.1) Consent of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. (included
in opinion of counsel filed as Exhibit 5).
(23.2) Consent of KPMG LLP.
(24) Power of Attorney to file future amendments (set forth on the signature
page of this Registration Statement).
(99.1) The Ibis Technology Corporation 2000 Employee Stock Purchase Plan.
</TABLE>
II-6
<PAGE>
MINTZ, LEVIN, COHN, FERRIS, GLOVSKY AND POPEO, P.C.
One Financial Center
Boston, Massachusetts 02111
May 10, 2000
Ibis Technology Corporation
32 Cherry Hill Drive
Danvers, MA 01923
Ladies and Gentlemen:
We have acted as counsel to Ibis Technology Corporation, a Massachusetts
corporation (the "Company"), in connection with the preparation and filing
with the Securities and Exchange Commission of a Registration Statement on
Form S-8 (the "Registration Statement"), pursuant to which the Company is
registering the issuance under the Securities Act of 1933, as amended, of a
total of 300,000 hsares (the "Shares") of its common stock, $.008 par value
per share (the "Common Stock"). This opinion is being rendered in connection
with the filing of the Registration Statement. All capitalized terms used
herein and not otherwise defined shall have the respective meanings given to
them in the Registration Statement.
In connection with this opinion, we have examined the Company's Restated
Articles of Organization, and Restated Bylaws, both as currently in effect;
such other records of the corporate proceedings of the Company and
certificates of the Company's officers as we have deemed relevant; and the
Registration Statement and the exhibits thereto.
In our examination, we have assumed the genuineness of all signatures, the
legal capacity of natural persons, the authenticity of all documents submitted
to us as originals, the conformity to original documents of all documents
submitted to us as certified or photostatic copies and the authenticity of the
originals of such copies.
Based upon the foregoing, we are of the opinion that (i) the Shares have been
duly and validly authorized by the Company and (ii) the Shares, when issued,
will be duly and validly issued, fully paid and non-assessable shares of the
Common Stock, free of preemptive rights.
Our opinion is limited to the laws of the Commonwealth of Massachusetts, and
we express no opinion with respect to the laws of any other jurisdiction. No
opinion is expressed herein with respect to the qualification of the Shares
under the securities or blue sky laws of any state or any foreign jurisdiction.
BOSTON NEW YORK RESTON WASHINGTON
<PAGE>
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
May 10, 2000
Page 2
We understand that you wish to file this opinion as an exhibit to the
Registration Statement, and we hereby consent thereto.
Very truly yours,
/s/ Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors and Stockholders
Ibis Technology Corporation:
We consent to the incorporation by reference in the Form S-8 filing of
Ibis Technology Corporation of our report dated February 4, 2000, relating to
the balance sheets of Ibis Technology Corporation as of December 31, 1998 and
1999, and the related statements of operations, stockholders' equity, and cash
flows for each of the years in the three-year period ending December 31, 1999,
which report appears in the December 31, 1999 annual report on 10-K of Ibis
Technology Corporation.
/s/ KPMG LLP
KPMG LLP
Boston, Massachusetts
May 10, 2000
<PAGE>
EXHIBIT 99.1
IBIS TECHNOLOGY CORPORATION
2000 EMPLOYEE STOCK PURCHASE PLAN
The following constitute the provisions of the 2000 Employee Stock
Purchase Plan (the "Plan") of Ibis Technology Corporation (the "Company").
1. PURPOSE. The purpose of the Plan is to provide Employees of the
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company. It is the intention of the Company to have the Plan
qualify as an "Employee Stock Purchase Plan" under Section 423 of the Internal
Revenue Code of 1986, as amended. The provisions of the Plan shall, accordingly,
be construed so as to extend and limit participation in a manner consistent with
the requirements of that section of the Code.
2. DEFINITIONS.
(a) "BOARD" shall mean the Board of Directors of the Company, or a
committee of the Board of Directors named by the Board to administer the Plan.
(b) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
(c) "COMMON STOCK" shall mean the Common Stock, $.008 par value, of the
Company.
(d) "COMPANY" shall mean Ibis Technology Corporation, a Massachusetts
corporation.
(e) "COMPENSATION" shall mean all compensation that is taxable income
for federal income tax purposes, including, payments for overtime, shift
premium, incentive compensation, incentive payments, bonuses, commissions and
other compensation but shall exclude relocation, expense reimbursements, tuition
or other reimbursements and income realized as a result of participation in any
stock option, stock purchase, or similar plan of the Company or any Designated
Subsidiary.
(f) "CONTINUOUS STATUS AS AN EMPLOYEE" shall mean the absence of any
interruption or termination of service as an Employee. Continuous Status as an
Employee shall not be considered interrupted in the case of a leave of absence
agreed to in writing by the Company, provided that such leave is for a period of
not more than 90 days or reemployment upon the expiration of such leave is
guaranteed by contract or statute.
(g) "CONTRIBUTIONS" shall mean all amounts credited to the account of a
participant pursuant to the Plan.
(h) "DESIGNATED SUBSIDIARIES" shall mean the Subsidiaries which have
been designated by the Board from time to time in its sole discretion as
eligible to participate in the Plan.
(i) "EMPLOYEE" shall mean any person, including an officer, who is
customarily employed for at least 20 hours per week by the Company or one of its
Designated Subsidiaries and is not considered a temporary employee as defined in
the Company's Policy Manual.
(j) "EXERCISE DATE" shall mean the last day of each Offering Period of
the Plan.
(k) "OFFERING DATE" shall mean the first business day of each Offering
Period of the Plan, except that in the case of an individual who becomes an
eligible Employee after the first business day of
<PAGE>
an Offering Period but on or prior to the first business day of the fourth
calendar month within such Offering Period, the term "Offering Date" shall
mean the first business day of such fourth calendar month coinciding with or
next succeeding the day on which that individual becomes an eligible Employee.
Options granted after the first business day of an Offering Period will
be subject to the same terms as the options granted on the first business day of
such Offering Period except that they will have a different grant date (thus,
potentially, a different exercise price) and, because they expire at the same
time as the options granted on the first business day of such Offering Period, a
shorter term.
(l) "OFFERING PERIOD" shall mean a period of six months.
(m) "PLAN" shall mean this Ibis Technology Corporation 2000 Employee
Stock Purchase Plan.
(n) "SUBSIDIARY" shall mean a corporation, domestic or foreign, of
which not less than 50% of the voting shares are held by the Company or a
Subsidiary, whether or not such corporation now exists or is hereafter organized
or acquired by the Company or a Subsidiary.
3. ELIGIBILITY.
(a) Any person who has been continuously employed as an Employee for
three (3) months as of the Offering Date of a given Offering Period shall be
eligible to participate in such Offering Period under the Plan, provided that
such person was not eligible to participate in such Offering Period as of any
prior Offering Date, and further, subject to the requirements of paragraph 5(a)
and the limitations imposed by Section 423(b) of the Code.
(b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately after the
grant, such Employee (or any other person whose stock would be attributed to
such Employee pursuant to Section 424(d) of the Code) would own stock and/or
hold outstanding options to purchase stock possessing five percent (5%) or more
of the total combined voting power or value of all classes of stock of the
Company or of any Subsidiary of the Company; or (ii) which permits his or her
rights to purchase stock under all employee stock purchase plans (described in
Section 423 of the Code) of the Company and its Subsidiaries to accrue at a rate
which exceeds $25,000 of fair market value of such stock (determined at the time
such option is granted) for each calendar year in which such option is
outstanding at any time. Any option granted under the Plan shall be deemed to be
modified to the extent necessary to satisfy this paragraph (b).
4. OFFERING PERIODS. The Plan shall be implemented by a series of
Offering Periods, with a new Offering Period commencing on June 1 and December 1
of each year (or at such other time or times as may be determined by the Board
of Directors). The initial Offering Period shall commence at a time to be
determined by the Board. The Plan shall continue until terminated in accordance
with paragraph 19 hereof. The Board of Directors of the Company shall have the
power to change the duration and/or the frequency of Offering Periods with
respect to future offerings without stockholder approval if such change is
announced at least 15 days prior to the scheduled beginning of the first
Offering Period to be affected.
2
<PAGE>
5. PARTICIPATION.
(a) An eligible Employee may become a participant in the Plan by
completing an Enrollment Form provided by the Company and filing it with the
Company prior to the applicable Offering Date, unless a later time for filing
the Enrollment Form is set by the Board for all eligible Employees with respect
to a given Offering Period. The Enrollment Form shall set forth the percentage
of the participant's Compensation (which shall be not less than 1% and not more
than 15%) to be paid as Contributions pursuant to the Plan.
(b) Payroll deductions shall commence on the first payroll following
the Offering Date and shall end on the last payroll paid on or prior to the
Exercise Date of the Offering Periods to which the Enrollment Form is
applicable, unless sooner terminated by the participant as provided in paragraph
10.
6. METHOD OF PAYMENT OF CONTRIBUTIONS.
(a) The participant shall elect to have payroll deductions made on each
payday during the Offering Period in an amount not less than 1% and not more
than 15% of such participant's Compensation on each such payday; provided that
the aggregate of such payroll deductions during the Offering Period shall not
exceed 15% of the participant's aggregate Compensation during said Offering
Period. All payroll deductions made by a participant shall be credited to his or
her account under the Plan. A participant may not make any additional payments
into such account.
(b) A participant may discontinue his or her participation in the Plan
as provided in paragraph 10, or, on one occasion only during the Offering
Period, may decrease, but may not increase, the rate of his or her Contributions
during the Offering Period by completing and filing with the Company a new
Enrollment Form authorizing a change in the deduction rate. THE CHANGE IN RATE
SHALL BE EFFECTIVE AS OF THE BEGINNING OF THE NEXT PAYROLL PERIOD FOLLOWING THE
DATE OF THE FILING OF SUCH NEW ENROLLMENT FORM, IF THE ENROLLMENT FORM IS
COMPLETED AT LEAST FIVE (5) BUSINESS DAYS PRIOR TO SUCH DATE, AND, IF NOT, AS OF
THE BEGINNING OF THE NEXT SUCCEEDING PAYROLL PERIOD.
(c) Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and paragraph 3(b) hereof, a participant's
payroll deductions may be decreased to 0% at such time and for so long as the
aggregate of all payroll deductions accumulated with respect to the current
Offering Period and any other Offering Period ending within the current calendar
year equals $21,250. Payroll deductions shall recommence at the rate provided in
such participant's Enrollment Form at the beginning of the first Offering Period
which is scheduled to end in the following calendar year, unless terminated by
the participant as provided in paragraph 10.
7. GRANT OF OPTION.
(a) On the Offering Date of each Offering Period, each eligible
Employee participating in such Offering Period shall be granted an option to
purchase on the Exercise Date of such Offering Period a number of shares of the
Common Stock determined by dividing such Employee's Contributions accumulated
prior to such Exercise Date and retained in the participant's account as of the
Exercise Date by the lower of (i) 85% of the fair market value of a share of
Common Stock on the Offering Date, or (ii) 85% of the fair market value of a
share of the Common Stock on the Exercise Date; provided however, that such
purchase shall be subject to the limitations set forth in Sections 3(b) and 12
hereof. The fair market value of a share of the Common Stock shall be determined
as provided in Section 7(b) herein.
3
<PAGE>
(b) The option price per share of the shares offered in a given
Offering Period shall be the lower of (i) 85% of the fair market value of a
share of the Common Stock on the Offering Date, or (ii) 85% of the fair market
value of a share of the Common Stock on the Exercise Date. The fair market value
of the Common Stock on a given date shall be determined by the Board based on
the closing sale price of the Common Stock for such date (or, in the event that
the Common Stock is not traded on such date, on the immediately preceding
trading date), as reported by the National Association of Securities Dealers
Automated Quotation (Nasdaq) National Market or, if such price is not reported,
the mean of the bid and asked prices per share of the Common Stock as reported
by Nasdaq or, in the event the Common Stock is listed on a stock exchange, the
fair market value per share shall be the closing sale price on such exchange on
such date (or, in the event that the Common Stock is not traded on such date, on
the immediately preceding trading date), as reported in THE WALL STREET JOURNAL.
8. EXERCISE OF OPTION. Unless a participant withdraws from the Plan as
provided in paragraph 10, his or her option for the purchase of shares will be
exercised automatically on the Exercise Date of the Offering Period, and the
maximum number of full shares subject to option will be purchased for him or her
at the applicable option price with the accumulated Contributions in his or her
account. If a fractional number of shares results, then such number shall be
rounded down to the next whole number and any unapplied cash shall be carried
forward to the next Exercise Date, unless the participant requests a cash
payment. The shares purchased upon exercise of an option hereunder shall be
deemed to be transferred to the participant on the Exercise Date. During a
participant's lifetime, a participant's option to purchase shares hereunder is
exercisable only by him or her.
9. DELIVERY. Upon the written request of a participant, certificates
representing the shares purchased upon exercise of an option will be issued as
promptly as practicable after the Exercise Date of each Offering Period to
participants who wish to hold their shares in certificate form. Any cash
remaining in a participant's account under the Plan after a purchase by him or
her of shares at the termination of each Offering Period shall be carried
forward to the next Exercise Date unless the participant requests a cash
payment.
10. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) A participant may withdraw all but not less than all the
Contributions credited to his or her account under the Plan at any time prior to
the Exercise Date of the Offering Period by giving written notice to the
Company. All of the participant's Contributions credited to his or her account
will be paid to him or her promptly after receipt of his or her notice of
withdrawal and his or her option for the current period will be automatically
terminated, and no further Contributions for the purchase of shares will be made
during the Offering Period.
(b) Upon termination of the participant's Continuous Status as an
Employee prior to the Exercise Date of the Offering Period for any reason,
including retirement or death, the Contributions credited to his or her account
will be returned to him or her or, in the case of his or her death, to the
person or persons entitled thereto under paragraph 14 hereof, and his or her
option will be automatically terminated.
(c) In the event an Employee fails to remain in Continuous Status as an
Employee for at least 20 hours per week during the Offering Period in which the
Employee is a participant, he or she will be deemed to have elected to withdraw
from the Plan and the Contributions credited to his or her account will be
returned to him or her and his or her option terminated.
4
<PAGE>
(d) A participant's withdrawal from an Offering Period will not have
any effect upon his or her eligibility to participate in a succeeding offering
or in any similar plan which may hereafter be adopted by the Company.
11. INTEREST. No interest shall accrue on the Contributions of a
participant in the Plan.
12. STOCK.
(a) The maximum number of shares of Common Stock which shall be made
available for sale under the Plan shall be 300,000 shares, subject to adjustment
upon changes in capitalization of the Company as provided in paragraph 18. If
the total number of shares which would otherwise be subject to options granted
pursuant to Section 7(a) hereof on the Offering Date of an Offering Period
exceeds the number of shares then available under the Plan (after deduction of
all shares for which options have been exercised or are then outstanding), the
Company shall make a pro rata allocation of the shares remaining available for
option grants in as uniform a manner as shall be practicable and as it shall
determine to be equitable. Any amounts remaining in an Employee's account not
applied to the purchase of stock pursuant to this Section 12 shall be refunded
on or promptly after the Exercise Date. In such event, the Company shall give
written notice of such reduction of the number of shares subject to the option
to each Employee affected thereby and shall similarly reduce the rate of
Contributions, if necessary.
(b) The participant will have no interest or voting right in shares
covered by his or her option until such option has been exercised.
13. ADMINISTRATION. The Board shall supervise and administer the Plan
and shall have full power to adopt, amend and rescind any rules deemed desirable
and appropriate for the administration of the Plan and not inconsistent with the
Plan, to construe and interpret the Plan, and to make all other determinations
necessary or advisable for the administration of the Plan.
14. DESIGNATION OF BENEFICIARY.
(a) A participant may file a written designation of a beneficiary who
is to receive any shares and cash, if any, from the participant's account under
the Plan in the event of such participant's death subsequent to the end of the
Offering Period but prior to delivery to him or her of such shares and cash. In
addition, a participant may file a written designation of a beneficiary who is
to receive any cash from the participant's account under the Plan in the event
of such participant's death prior to the Exercise Date of the Offering Period.
If a participant is married and the designated beneficiary is not the spouse,
spousal consent shall be required for such designation to be effective.
(b) Such designation of beneficiary may be changed by the participant
(and his or her spouse, if any) at any time by written notice. In the event of
the death of a participant and in the absence of a beneficiary validly
designated under the Plan who is living at the time of such participant's death,
the Company shall deliver such shares and/or cash to the executor or
administrator of the estate of the participant, or if no such executor or
administrator has been appointed (to the knowledge of the Company), the Company,
in its discretion, may deliver such shares and/or cash to the spouse or to any
one or more dependents or relatives of the participant, or if no spouse,
dependent or relative is known to the Company, then to such other person as the
Company may designate.
15. TRANSFERABILITY. Neither Contributions credited to a participant's
account nor any rights with regard to the exercise of an option or to receive
shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by will, the laws of descent and distribution
or as provided in paragraph 14 hereof) by the participant. Any such attempt at
assignment, transfer, pledge or
5
<PAGE>
other disposition shall be without effect, except that the Company may treat
such act as an election to withdraw funds in accordance with paragraph 10
hereof.
16. USE OF FUNDS. All Contributions received or held by the Company
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such Contributions.
17. REPORTS. Individual accounts will be maintained for each
participant in the Plan. Statements of account will be given to participating
Employees promptly following the Exercise Date, which statements will set forth
the amounts of Contributions, the per share purchase price, the number of shares
purchased and the remaining cash balance, if any.
18. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. Subject to any required
action by the stockholders of the Company, the number of shares of Common Stock
covered by unexercised options under the Plan and the number of shares of Common
Stock which have been authorized for issuance under the Plan but are not yet
subject to options (collectively, the "Reserves"), as well as the price per
share of Common Stock covered by each unexercised option under the Plan, shall
be proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of shares of Common Stock effected without
receipt of consideration by the Company; provided, however, that conversion of
any convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issue by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock subject to an option.
In the event of the proposed dissolution or liquidation of the Company,
the Offering Period will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board. In the event of a
proposed sale of all or substantially all of the assets of the Company, or the
merger of the Company with or into another corporation, each option under the
Plan shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Board determines, in the exercise of its sole discretion and in lieu
of such assumption or substitution, to shorten the Offering Period then in
progress by setting a new Exercise Date (the "New Exercise Date"). If the Board
shortens the Offering Period then in progress in lieu of assumption or
substitution in the event of a merger or sale of assets, the Board shall notify
each participant in writing, at least ten days prior to the New Exercise Date,
that the Exercise Date for his or her option has been changed to the New
Exercise Date and that his or her option will be exercised automatically on the
New Exercise Date, unless prior to such date he or she has withdrawn from the
Offering Period as provided in paragraph 10 hereof. For purposes of this
paragraph, an option granted under the Plan shall be deemed to be assumed if,
following the sale of assets or merger, the option confers the right to
purchase, for each share of Common Stock subject to the option immediately prior
to the sale of assets or merger, the consideration (whether stock, cash or other
securities or property) received in the sale of assets or merger by holders of
Common Stock for each share of Common Stock held on the effective date of the
transaction (and if such holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
shares of Common Stock); provided, however, that if such consideration received
in the sale of assets or merger was not solely common stock of the successor
corporation or its parent (as defined in Section 424(e) of the Code), the Board
may, with the consent of the successor corporation, provide for the
consideration to be received upon exercise of the option to be solely common
stock of the successor corporation or its parent equal in fair market value to
the per share consideration received by holders of Common Stock in the sale of
assets or merger.
6
<PAGE>
The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the price
per share of Common Stock covered by each outstanding option, in the event that
the Company effects one or more reorganizations, recapitalizations, rights
offerings or other increases or reductions of shares of its outstanding Common
Stock, and in the event of the Company being consolidated with or merged into
any other corporation.
19. AMENDMENT OR TERMINATION. The Board may at any time terminate or
amend the Plan. Except as provided in paragraph 18 hereof, no such termination
may affect options previously granted, nor may an amendment make any change in
any option theretofore granted which adversely affects the rights of any
participant. In addition, to the extent necessary to comply with Section 423 of
the Code (or any successor rule or provision or any applicable law or
regulation), the Company shall obtain stockholder approval in such a manner and
to such a degree as so required.
20. NOTICES. All notices or other communications by a participant to
the Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the location,
or by the person, designated by the Company for the receipt thereof.
21. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.
As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.
22. RIGHT TO TERMINATE EMPLOYMENT. Nothing in the Plan or in any
agreement entered into pursuant to the Plan shall confer upon any Employee or
other optionee the right to continue in the employment of the Company or any
Subsidiary, or affect any right which the Company or any Subsidiary may have to
terminate the employment of such Employee or other optionee.
23. RIGHTS AS A STOCKHOLDER. Neither the granting of an option nor a
deduction from payroll shall constitute an Employee the owner of shares covered
by an option. No optionee shall have any right as a stockholder unless and until
an option has been exercised, and the shares underlying the option have been
registered in the Company's share register.
24. TERM OF PLAN. The Plan became effective upon its adoption by the
Board of Directors in February, 2000 and shall continue in effect for a term of
ten years unless sooner terminated under paragraph 19 hereof.
25. APPLICABLE LAW. This Plan shall be governed in accordance with the
laws of State of Massachusetts, applied without giving effect to any
conflict-of-law principles.
7
