Exhibit 4.1
LIGHTPATH TECHNOLOGIES, INC.
AMENDED AND RESTATED
DIRECTORS STOCK OPTION PLAN
1. PURPOSE.
This Amended and Restated LightPath Technologies, Inc. Directors Stock
Option Plan (the Plan") is intended as an amendment and restatement of the
LightPath Technologies, Inc. Directors Stock Option Plan. The options granted
under this Plan are intended as an incentive to retain as independent directors
on the Board of Directors of LightPath Technologies, Inc. persons of training,
experience and ability, to encourage the sense of proprietorship of such persons
and to stimulate the active interests of such persons in the development and
financial success of LightPath Technologies, Inc. The options issued pursuant to
this Plan shall constitute non-qualified stock options, taxable in accordance
with Section 83 of the Internal Revenue Code of 1986, as amended.
2. EFFECTIVE DATE AND TERM OF PLAN.
The effective date of this Plan, as amended and restated, is November 14,
2000. The Plan shall terminate on the earlier of: (i) the effective date of
termination of the Plan by the Board in accordance with Section 9; or (ii) the
date on which all shares of Common Stock reserved under the Plan are subject to
Options granted under the Plan.
3. DEFINITIONS.
For purposes of this Plan, the following terms shall have the meanings set
forth below:
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the Internal Revenue Code of 1986, as amended, together
with the regulations promulgated thereunder.
(c) "Common Stock" means the Class A Common Stock of the Company or any
security of Company issued in substitution, exchange or lieu thereof.
(d) "Company" means LightPath Technologies, Inc. or any successor
corporation.
(e) "Director" means an individual who: (i) is a member of the Board as a
director; (ii) is not an employee of the Company or any Subsidiary;
and (iii) in the event the Company becomes subject to the provisions
of the Exchange Act, is not eligible, and has not been eligible for at
least one year prior to becoming a nonemployee director of the
Company, to receive a grant or award of equity securities pursuant to
a plan of the Company or any affiliate of the Company that is
administered by any person having discretion with respect to the
selection of participants and/or the amount of awards, as determined
under Rule 16b-3 promulgated under the Exchange Act.
(f) "Disability" means permanent and total disability. An individual is
permanently and totally disabled if he or she is unable to engage in
any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to
result in death or which has lasted or can be expected to last for a
continuous period of not less than 12 months.
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(g) "Eligibility Date" means the date as of which an individual first
becomes a Director.
(h) "Exchange Act" means the Securities Exchange Act of 1934, as amended
and in effect from time to time, or any successor statute.
(i) "Fair Market Value" means on any given date (i) the highest closing
price of a share of the Common Stock on any established national
exchange or exchanges or, if no sale of Common Stock is made on such
day, the next preceding day on which there was a sale of such stock,
or (ii) if the Common Stock is quoted in the over-the-counter market
reported by the National Association of Securities Dealers, Inc. the
mean between the closing paid and low asked quotations of the Common
Stock for such date, or (iii) if the Common Stock is neither quoted on
an exchange nor in the over-the-counter market, then the fair market
value as determined by the Board, taking into account various factors
consistent with the provisions of applicable law pertaining to the
valuation of stock for federal income tax purposes.
(j) "Plan" means this Directors Stock Option Plan, as set forth herein and
as it may be hereafter amended.
(k) "Option" means an option to purchase shares of Common Stock granted
pursuant to the provisions of Section 5 of the Plan.
(l) "Option Agreement" means the written document that sets forth the
terms and conditions of an Option, as described in Section 10(e).
(m) "Subsidiary" means any corporation or entity in which the Company
directly or indirectly controls 50% or more of the total voting power
of all classes of its stock having voting power, whether existing at
the date of institution of this Plan or subsequently.
4. COMMON STOCK SUBJECT TO PLAN.
Shares of Common Stock Subject to Plan. The maximum number of shares of Common
Stock in respect of which Options shall be granted under the Plan (the "Plan
Maximum") shall be 450,000, subject to adjustment as provided in Section 6
below. Common Stock issued under the Plan may be either authorized and un-issued
shares or issued shares which have been reacquired by the Company. The following
terms and conditions shall apply to Common Stock subject to the Plan:
(i) In no event shall more than the Plan Maximum be cumulatively available
for Options under the Plan;
(ii) For the purpose of computing the total number of shares of Common
Stock available for Options under the Plan, there shall be counted
against the foregoing limitations, the number of shares of Common
Stock subject to issuance upon exercise or settlement of Options
(regardless of exercisability);
(iii) If any Options are forfeited, terminated or expire un-exercised, the
shares of Common Stock which were previously subject to the Options
shall again be available for Options under the Plan to the extent of
such forfeiture or expiration of the Options;
(iv) Any shares of Common Stock which are used as full or partial payment
to the Company by a Director of the purchase price of shares of Common
Stock upon exercise of an Option shall again be available for Options
under the Plan; and
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(v) Any shares of Common Stock that may remain unsold and that are not
subject to outstanding Options at the termination of the Plan shall
cease to be reserved for the purpose of the Plan, but until
termination of the Plan the Company shall at all times reserve a
sufficient number of shares to meet the requirements of the Plan.
5. FORMULA FOR GRANT OF OPTIONS.
(a) General. An Option shall be granted pursuant to Subsection (b) below,
to each person who is a Director. Each Option shall be evidenced by an
Option Agreement in a form specified by the Board containing such
terms and conditions that are consistent with the terms of this Plan
or applicable law. An Option granted to a Director under this Plan
shall be in addition to regular directors' fees or other benefits with
respect to the Director's position with the Company or any of its
Subsidiaries. Neither the Plan nor any Option granted under the Plan
shall confer upon any person any right to continue to serve as a
director of the Company.
(b) Grant. (1) A Director shall be granted, effective as of the Director's
Eligibility Date, an option to purchase 20,000 shares of Common Stock
which shall vest 1/12 per month for one year. (2) Each director shall
be granted an additional option as an annual grant ("Annual Grant") to
purchase 4,000 shares of Common Stock at the annual meeting. The
Annual Grant shall vest 1/12 per month for one year. The director must
be active at the annual meeting to obtain this Annual Grant.
An Option shall be exercisable, only if the Director has continued to
perform services as a director of the Company during the period
beginning on the date the Option is first granted and ending on the
date the relevant portion of the Option is first exercisable, as the
case may be. The exercisability of an Option upon cessation of such
services is set forth in Subsection (f), below.
The term of an Option grant pursuant to this Subsection (b) shall be
ten (10) years commencing as of the effective date of the grant,
regardless of whether the relationship between the individual and the
Company terminates or changes. The exercise price for a share of
Common Stock under an Option grant pursuant to this Subsection (b)
shall be the Fair Market Value of a share of Common Stock as of the
effective date of the grant.
(c) Method of Exercise. Subject to applicable exercise restrictions set
forth herein, an Option may be exercised, in whole or in part, by
giving written notice of exercise to the Company specifying the number
of shares to be purchased. The notice shall be accompanied by payment
in full of the purchase price. The purchase price may be paid by any
of the following methods, subject to the restrictions set forth in
Subsection (d), below:
(1) in cash, by certified or cashier's check, by money order or by
personal check (if approved by the Board) of an amount equal to
the aggregate purchase price of the shares of Common Stock to
which such exercise relates;
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(2) if acceptable to the Board, by delivery of shares of Common Stock
already owned by the Director, which shares, including any cash
tendered therewith, have an aggregate Fair Market Value
(determined as of the date preceding the Company's receipt of
exercise notice) equal to the aggregate purchase price of the
shares of Common Stock to which such exercise relates; or
(3) if acceptable to the Board, by delivery to the Company of an
exercise notice that (i) requests the Company, subsequent to the
exercise of the Option and prior to the actual delivery of any
shares of Common Stock to the Director, to arrange for the sale
of that number of shares of Common Stock that have a value equal
to the exercise price of the Option and (ii) agrees that the
Company may use the proceeds of such sale to discharge the
Director's liability to pay to the Company the exercise price of
such Option.
(d) Restrictions on Method of Exercise. Notwithstanding the foregoing
payment provisions, the Board may refuse to recognize the method of
exercise selected by the Director (other than the method of exercise
set forth in Subsection (c)(1)), above, if, in the opinion of counsel
to the Company, (i) the Director is, or within the six months
preceding such exercise was, subject to reporting under Section 16(a)
of the Exchange Act, and (ii) there is a substantial likelihood that
the method of exercise selected by the Director would subject the
Director to substantial risk of liability under Section 16 of the
Exchange Act.
(e) Grant of Reload Options. Whenever a Director holding any Option (the
"Original Option") outstanding under this Plan (including any "Reload
Options" granted under the provisions of this Subsection (e))
exercises the Original Option and makes payment of the option price by
tendering shares of Common Stock previously held by him or her, then
the Board will grant a new option (the "Reload Option") for additional
shares of Common Stock equal to the number of shares tendered by the
Director in payment of the option price for the Original Option being
exercised. All such Reload Options granted hereunder shall be on the
following terms and conditions:
(1) The Reload Option exercise price per share shall be an amount
equal to the then current Fair Market Value of a share of Common
Stock, determined as of the date of the Company's receipt of the
exercise notice for the Original Option;
(2) The option exercise period shall expire, and the Reload Option
shall no longer be exercisable, on the expiration of the option
period of the Original Option or two (2) years from the date of
the grant of the Reload Option, whichever is later,
(3) Any Reload Option granted under this Subsection (e) shall become
exercisable one (1) year following the date of exercise of the
Original Option; and
(4) All other terms of Reload Options granted hereunder shall be
identical to the terms and conditions of the Original Option, the
exercise of which gives rise to the grant of the Reload Option.
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(f) Exercisability of Options Upon Termination of Relationship with the
Company. Notwithstanding anything in the Plan to the contrary, a
Director who ceases to perform services as a director of the Company
for any reason (including death and Disability) shall be entitled to
exercise any outstanding Options for the remainder of each Option's
term, but only to the extent the Option was exercisable as of the date
of such cessation of services. In the event of the death of the
Director, the Director's beneficiary shall be entitled to exercise any
outstanding Options to the extent permitted in accordance with the
preceding sentence.
(g) Non-transferability of Options. No Option and no rights or interest
therein shall be assignable or transferable by a Director except by
will or the laws of descent and distribution. During the lifetime of
the Director or the Director's beneficiary, as the case may be,
Options are exercisable only by the Director, or the Director's
beneficiary, as the case may be, or the legal representative of the
Director or the Director's beneficiary.
6. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, ETC.
(a) General. The existence of the Plan and the Options granted hereunder
shall not affect or restrict in any way the right or power of the
Board or the stockholders of the Company to make or authorize any
adjustment, re-capitalization, reorganization or other change in the
Company's capital structure or its business, any merger or
consolidation of the Company, any issue of bonds, debentures,
preferred or prior preference stocks ahead of or affecting the
Company's Common Stock or the rights thereof, the dissolution or
liquidation of the Company, or any sale or transfer of all or any part
of its assets or business, or any other corporate act or proceeding.
(b) Change in Capitalization. In the event of any change in capitalization
affecting the Common Stock of the Company, such as a stock dividend,
stock split, re-capitalization, merger, consolidation, split up,
combination, exchange of shares, other form of reorganization, or any
other change affecting the Common Stock, the Board, in its discretion,
may make proportionate adjustments it deems appropriate to reflect
such change with respect to (i) the maximum number of shares of Common
Stock which may be sold or awarded to any Director, (ii) the number of
shares of Common Stock covered by each outstanding Option, and (iii)
the price per share in respect of the outstanding Options.
Notwithstanding the foregoing, the Board may only increase the
aggregate number of shares of Common Stock for which Options may be
granted under the Plan solely to reflect the change, if any, of the
capitalization of the Company or a Subsidiary.
(c) Sale of Assets. The Board may also make such adjustments in the number
of shares covered by, and the price or other value of any outstanding
Options in the event of a spin off or other distribution (other than
normal cash dividends) of Company assets to stockholders.
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7. CHANGE OF CONTROL.
(a) General. In the event of Change of Control (as defined in Subsection
(b) below) of the Company, Options then outstanding with respect to an
affected Director shall become fully exercisable as of the applicable
date. For purposes of this Subsection (a), "applicable date" shall
mean the earlier of the two dates on which occur the events described
in subsections (b)(1) and (b)(2) below.
(b) Definition. A "Change of Control" shall be deemed to have occurred
with respect to a Director upon the occurrence of any one of the
following events, other than a transaction with another person
controlled by the Company or its officers or directors, or a benefit
plan or trust established by the Company for its employees:
(1) Any person, including a group as defined in Section 13(d)(3) of
the Exchange Act, becomes owner of shares of Common Stock of the
Company with respect to which fifty-one (51%) or more of the
total number of votes for the election of the Board may be cast;
or
(2) The stockholders of the Company approve an agreement providing
for the sale or other disposition of all or substantially all of
the assets of the Company.
8. SECURITIES LAWS RESTRICTIONS.
Each person exercising an Option may be required by the Company to give a
representation in writing that he or she is acquiring shares of Common Stock for
his or her own account for investment and not with a view to, or for sale in
connection with, the distribution of any part thereof (regardless of whether the
Option and shares of Common Stock covered by the Plan are registered under the
Securities Act of 1933, as amended). As a condition of transfer of the
certificate evidencing shares of Common Stock, the Board may obtain such other
agreements or undertakings, if any, that it may deem necessary or appropriate to
assume compliance with any provisions of the Plan or any law or regulation.
Certificates for shares of Common Stock delivered under the Plan may be subject
to such stock transfer orders and other restrictions as the Board may deem
advisable under the rules, regulations, and other requirements of the Securities
and Exchange Commission, any stock exchange upon which the shares of Common
Stock are then listed, and any applicable Federal or state securities laws. The
Board may cause a legend or legends to be put on any such certificate to refer
to those restrictions.
9. AMENDMENT AND TERMINATION.
(a) Amendments Without Stockholder Approval. Except as set forth in
Subsections (b) and (c) below, the Board may, without further approval
of the stockholders, amend or terminate this Plan for purposes of
meeting or addressing any changes in legal requirements applicable to
the Plan or for any other reason permitted by law.
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(b) Amendments Requiring Stockholder Approval. The Board must obtain
approval of the stockholders to make any amendment to the Plan for
which stockholder approval is required to comply with the restrictions
set forth in Rule 16b-3 promulgated under the Exchange Act, as amended
and in effect from time to time (or any successor rule) and to comply
with the Code and accompanying regulations, but subject to changes in
law or other legal requirements (including any change in the
provisions of Rule 16b-3 and the Code and accompanying regulations
that would permit otherwise).
(c) Prohibited Amendments. Notwithstanding Subsections (a) and (b), the
provisions of Section 5 regarding eligibility and automatic grants of
Options under the Plan shall not be amended more than once every six
(6) months, except for such amendments as may be necessary to comply
with the applicable provisions of the Code or the rules and
regulations promulgated thereunder.
10. MISCELLANEOUS MATTERS.
(a) Government Regulations. The Plan and the granting and exercise of
Options hereunder, and the obligations of the Company to sell and
deliver shares of Common Stock under such Options, shall be subject to
all applicable laws, rules and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may be
required.
(b) Costs of Plan. The costs and expenses of administering the Plan shall
be borne by the Company.
(c) Interpretation. If any provision of the Plan is held invalid for any
reason, such holding shall not affect the remaining provisions of the
Plan, but instead the Plan shall be construed and enforced as if such
provisions had never been included in the Plan. Headings contained in
the Plan are for convenience only and shall in no manner be construed
as part of this Plan. Any reference to the masculine, feminine or
neuter gender shall be a reference to such other gender as is
appropriate.
(d) Section 83(b) Election. If as a result of exercising an Option, a
Director receives shares of Common Stock that are subject to a
"substantial risk of forfeiture" and are not "transferable" as those
terms are defined for purposes of Section 83(b) of the Code, then such
Director may elect under Section 83(b) to include in his gross income,
for the taxable year in which the shares of Common Stock are
transferred to him, the excess of the fair market value of such shares
at the time of transfer (determined without regard to any restriction
other than one which by its terms will never lapse), over the amount
paid for such shares. If the Director makes the Section 83(b) election
described above, the Director shall (i) make the election in a manner
that is satisfactory to the Board; (ii) provide the Company with a
copy of such election; and (iii) agree to promptly notify the Company
if any Internal Revenue Service or state tax agent, on audit or
otherwise, questions the validity or correctness of such election or
of the amount of income reportable on account of such election.
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(e) Option Agreement and Beneficiary Designation. Each Director receiving
an Option grant under the Plan shall enter into an Option Agreement
with the Company in a form specified by the Board agreeing to the
terms and conditions of the Option. Each Director receiving an Option
grant under the Plan shall designate one or more beneficiaries who may
elect to exercise any Options exercisable upon or after the death of
the Director.
(f) Governing Law. The Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of
Delaware.
November 14, 2000
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