<PAGE>
Registration No._______________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ADVANCED LUMITECH, INC.
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(Exact name of registrant as specified in its charter)
Nevada 84-1058165
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(Jurisdiction of Incorporation) (I.R.S. Employer
Identification No.)
36 Avenue Cardinal-Mermillod, Carouge, Switzerland 1227
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(Address of Principal Executive Offices) (Zip Code)
1999 Stock Option/Stock Issuance Plan
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(Full title of the plan)
Nevada Corporate Services 1800 E. Sahara #107 Las Vegas, Nevada 89104
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(Name and address of agent for service)
(702) 734-7557
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(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Title of Amount to be Proposed Proposed Amount of
securities registered maximum maximum Registration
to be offering price aggregate fee(1)
registered per share offering price
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$.001 Par
Value 5,000,000(2) $1.00 $3,668,788 $1,020
===========================================================================================
</TABLE>
1. The total number of shares of Common Stock to be registered includes
2,350,000 shares of the Company's Common Stock issuable upon exercise of
options at exercise prices ranging from $.50 to $1.00, and 420,168 shares
issuable pursuant to a stock grant at a deemed value of $.357 per share. An
additional 2,229,832 shares are to be offered under the Company's 1999 Stock
Option/Stock Issuance Plan at prices not presently determinable. Pursuant to
Rule 457(c) and (h), the offering price for these additional shares is
estimated solely for the purposes of determining the registration fee and is
based on the $.745 average of the bid and asked price per share of the Common
Stock as reported by the National Association of Securities Dealers, Inc.
Electronic Bulletin Board on September 28, 1999.
2. The 5,000,000 shares shown are shares issuable upon the exercise of options
issued or issuable under the Company's 1999 Stock Option/Stock Issuance Plan,
and shares issuable pursuant to a stock grant under the Company's 1999 Stock
Option/Stock Issuance Plan. In addition, pursuant to Rule 416 (a) under the
Securities Act of 1933, as amended, there are also being registered such
additional shares of Common Stock as may become issuable pursuant to stock
splits, stock dividends or similar transactions.
<PAGE>
PART I
INFORMATION REQUIRED IN THE PROSPECTUS
Note: The document(s) containing the information concerning the Advanced
Lumitech, Inc. 1999 Stock Option/Stock Issuance Plan, dated September 10, 1999
(the "Plan"), required by Item 1 of Form S-8 under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and the statement of availability of
registrant information, employee benefit plan annual reports and other
information required by Item 2 of Form S-8 will be sent or given to participants
as specified by Rule 428. In accordance with Rule 428 and the requirements of
Part I of Form S-8, such documents are not being filed with the Commission
either as part of this Registration Statement on Form S-8 (the "Registration
Statement") or as prospectuses or prospectus supplements pursuant to Rule 424.
Advanced Lumitech, Inc., a Nevada corporation (the "Company"),shall maintain a
file of such documents in accordance with the provisions of Rule 428. Upon
request, the Company shall furnish to the Commission, or its staff, a copy or
copies of all of the documents included in such file.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by Advanced Lumitech, Inc. (the "Company")
with the Securities and Exchange Commission are incorporated in this
Registration Statement by reference:
(a) the Company's Annual Report on Form 10-K for the year ended December
31, 1998
(b) Quarterly Reports on Form 10-Q for the quarters ended March 31,
1999, and June 30, 1999;
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(c) Current Report on Form 8-K filed February 4, 1999; and
(d) Current Report on Form 8-KA filed September 20, 1999.
All documents subsequently filed by the Company 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
have been sold or which deregisters all securities then remaining unsold, are
incorporated herein by reference and constitute a part hereof from their
respective dates of filing.
Any statement contained in this Registration Statement, in a supplement
to this Registration Statement or in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any subsequently
filed supplement to this Registration Statement or in any document that is
subsequently incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the securities offered hereby will be passed upon for the
Company by Chappell White LLP, 268 Summer Street, Boston, Massachusetts. David
E. Dryer, a partner of Chappell White LLP, is the assistant secretary of the
Company. On September 10, 1999, the Company issued options to purchase 100,000
shares of the Company's Common Stock to Chappell White LLP, exercisable at $1.00
per share.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 78.751 of the General Corporation Law of Nevada, and Article XII
of the Company's Articles of Incorporation, as amended, generally permit the
Company to indemnify any officer or director of the Company for claims and
liabilities, including legal expenses, which he may incur in his capacity as
such, provided that he acted in good faith and in a manner that he reasonably
believed to be in the best interests of the Company. However, he may not be
indemnified in connection with a proceeding in which he is found to be liable to
the Company or where he is found to have received an improper personal benefit
from the Company. To the extent that an officer or director is successful in
defending himself in any proceeding to which he was a party, he is to be
indemnified against his reasonable expenses incurred by him in connection with
the proceeding.
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<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following is a complete list of exhibits filed as a part of, or
incorporated by reference in, this Registration Statement.
Exhibit No. Description
*4.1. Advanced Lumitech, Inc. 1999 Stock Option/Stock Issuance Plan.
*4.2 Form of Incentive Stock Option Agreement.
*4.3 Form of Non-Qualified Stock Option Agreement.
*5.1. Opinion of Chappell White LLP regarding legality.
*23.1. Consent of Ernst & Young LLP.
*23.2. Consent of Chappell White LLP (included in its opinion filed as
Exhibit 5.1).
*24.1. Power of Attorney (contained in signature page).
______________________________
*Filed herewith.
ITEM 9. UNDERTAKINGS.
The undersigned Company 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 (the "Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment (thereof) which individually or in the
aggregate, represent a fundamental change in the information set
forth in the Registration Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement.
(2) That, for the purpose of determining any liability under the Act,
each such
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<PAGE>
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 bonafide 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.
(4) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Company's annual
report pursuant to section 13(a) or section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Exchange Act) that is incorporated by reference
in the Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bonafide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Act may
be permitted to directors, officers, and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company 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 Company of expenses incurred or
paid by a director, officer, or controlling person of the Company 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 Company 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 of 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 or amendment to be signed on its behalf by the undersigned, thereunto
duly authorized, in Geneva, Switzerland, September 20, 1999.
ADVANCED LUMITECH, INC.
By: /s/ Patrick Planche
- -----------------------
Patrick Planche, Chief Executive Officer,
President, Principal Financial Officer and
Director
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<PAGE>
POWER OF ATTORNEY
The undersigned directors of Advanced Lumitech, Inc. hereby severally
constitute and appoint Patrick Planche our true and lawful attorney-in-fact and
agent with full power of substitution, to execute in our name and behalf in the
capacities indicated below any and all amendments to this Registration Statement
to be filed with the Securities and Exchange Commission and hereby ratify and
confirm all that such attorney-in-fact and agent shall lawfully do or cause to
be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in their
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Patrick Planche Chief Executive Officer, September 22, 1999
- ------------------------- President, Principal
Patrick Planche Financial Officer and
Director
/s/ Francois Planche Director September 22, 1999
- -------------------------
Francois Planche
/s/ Jose Canales la Rosa Director September 22, 1999
- -------------------------
Jose Canales la Rosa
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<PAGE>
Exhibit 4.1
ADVANCED LUMITECH, INC.
1999 STOCK OPTION/STOCK ISSUANCE PLAN
1. Purpose. This 1999 Stock Option/Stock Issuance Plan (the "Plan") is
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intended to promote the interests of Advanced Lumitech, Inc. (the "Company") by
giving incentives to the eligible officers and other employees and directors of
and consultants and advisors to the Company, its parent (if any) and any present
or future subsidiaries of the Company (collectively, "Related Corporations")
through providing opportunities to acquire stock in the Company. As used
herein, the terms "parent" and "subsidiary" mean "parent corporation" and
"subsidiary corporation", respectively, as those terms are defined in Sections
424(e) and 424(f) or successor provisions of the Internal Revenue Code of 1986
as amended from time to time (the "Code").
2. Structure of the Plan. The Plan permits the following separate types
---------------------
of grant:
A. Options may be granted hereunder to purchase shares of common stock of
the Company. These options may meet the requirements of Section 422 of the Code
("Incentive Stock Options" or "ISOs"); or, they may not qualify as ISOs ("Non-
Qualified Options"). Both ISOs and Non-Qualified Options are sometimes referred
to hereinafter as "Options".
B. Awards of stock in the Company ("Awards") may be granted.
C. Opportunities to make direct purchases of stock in the Company
("Purchases") may be authorized.
Options, Awards and authorizations to make Purchases are sometimes referred to
hereinafter as "Stock Rights".
3. Administration of the Plan.
--------------------------
A. The Plan shall be administered by the Board of Directors of the Company
(the "Board"). The Board may in its sole discretion grant Options, authorize
Purchases and grant Awards, as provided in the Plan. The Board shall have full
power and authority, subject to the express provisions of the Plan, to construe
and interpret the Plan and all Option agreements, Purchase authorizations and
Award grants thereunder, to establish, amend and rescind such rules and
regulations as it may deem appropriate for the proper administration of the
Plan, to determine in each case the terms and provisions which shall apply to a
particular Option agreement, Purchase authorization, or Award grant, and to make
all other determinations which are, in the Board's judgment, necessary or
desirable for the proper administration of the Plan. The Board may correct any
defect, supply any omission or reconcile any inconsistency in the Plan or in any
Option agreement, Purchase authorization or Award grant in the manner and to the
extent it shall, in its sole discretion, consider expedient. Decisions of the
Board shall be final and binding on all parties who have an interest in the Plan
or any Option, Purchase, Award, or stock issuance thereunder. No director or
person acting pursuant to authority delegated by the Board shall be liable for
any action or determination under the Plan made in good faith.
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B. The Board may, to the full extent permitted by and consistent with
applicable law and the Company's By-laws, and subject to Subparagraph D
hereinbelow, delegate any or all of its powers with respect to the
administration of the Plan to a committee (the "Committee") appointed by the
Board. If a Committee has been appointed, all references in this Plan to the
Board shall mean and relate to that Committee.
C. Those provisions of this Plan which make express reference to Rule 16b-
3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
any successor rule ("Rule 16b-3"), or which are required in order for certain
option transactions to qualify for exemption under Rule 16b-3, shall apply only
to those persons required to file reports under Section 16(a) of the Exchange
Act (a "Reporting Person").
D. If the Company registers any class of equity security under Section 12
of the Exchange Act, the selection of a director or an officer (as the terms
"director" and "officer" are defined for purposes of Rule 16b-3) as a recipient
of an option, the timing of the option grant, the exercise price of the option
and the number of shares subject to the option shall be determined either (i) by
the Board, if all of the Board members are disinterested persons within the
meaning of Rule 16(b)(3), or (ii) by two or more directors having full authority
to act in the matter, each of whom shall be such a disinterested person.
4. Eligible Employees and Others. ISOs may be granted to any employee of
-----------------------------
the Company or of any Related Corporation. No person who is not such an employee
may be granted an ISO. Non-Qualified Options, Awards, and authorizations to make
Purchases may be granted to any employee, officer or director of, or consultant
or advisor to the Company or any Related Corporation. The granting of any Stock
Right to any individual or entity shall neither entitle that individual or
entity to, nor disqualify him from, participation in any other grant of Stock
Rights.
5. Stock. The stock subject to Options, Awards and Purchases shall be
-----
authorized but unissued shares of common stock of the Company ("Common Stock"),
or shares of Common Stock reacquired by the Company in any manner. The
aggregate number of shares which may be issued under the Plan is Five Million
(5,000,000), subject to adjustment as provided in Paragraph 14. If any Option
granted under the Plan shall expire or terminate for any reason without having
been exercised in full or shall cease for any reason to be exercisable in whole
or in part, or if the Company shall reacquire any nonvested shares issued
pursuant to Awards or Purchases, the unpurchased shares subject to such Option,
or such nonvested shares so reacquired shall again be available for grants of
Stock Rights under the Plan.
6. Option Agreements. As a condition to the grant of an Option, each
-----------------
recipient of an Option shall execute an option agreement in such form not
inconsistent with the Plan as the Board shall approve. These option agreements
may differ among recipients. Each option agreement with respect to an ISO shall
be subject to the provisions of the Plan applicable to ISOs. The Board may, in
its sole discretion, include additional provisions in option agreements,
including without limitation restrictions on transfer, repurchase rights,
acceleration of vesting under certain circumstances, commitments to pay cash
bonuses, to make, arrange for or guarantee loans or to transfer other property
to optionees upon exercise of options, or such other provisions as shall be
determined by the Board; provided, however, that such additional provisions
shall not be inconsistent with any provision of the Plan and such additional
provisions shall not cause any ISO granted under the Plan to fail to qualify as
an incentive stock option within the meaning of Section 422 of the Code.
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7. Option Exercise Price.
---------------------
A. Subject to Subparagraph 3D of this Plan and Subparagraphs B and C of
this Paragraph 7, the purchase price per share of Common Stock deliverable upon
the exercise of an Option ("exercise price") shall be determined by the Board.
B. In the case of an ISO, the exercise price shall not be less than 100%
of the fair market value of Common Stock, as determined by the Board, at the
time of grant of such option, or less than 110% of such fair market value in the
case of an ISO granted to the owner of stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company or any
Related Corporation (after taking into account the attribution of stock
ownership rules of Section 424(d) of the Code) (a "10% Shareholder").
C. The exercise price of each Non-Qualified Option granted under the Plan
shall in no event be less than thirty percent (30%) of the fair market value per
share of Common Stock on the date of grant.
8. Cancellation and New Grant of Options, Etc. The Board shall have the
------------------------------------------
authority to effect, at any time and from time to time, with the consent of the
affected optionees, and after consideration of such factors as the Board
considers relevant (which may include any financial accounting consequences to
the Company, e.g., under APB Opinion No. 25), (i) the cancellation of any or all
outstanding Options and the grant in substitution therefor of new Options
covering the same or different shares of Common Stock and having an exercise
price per share which may be lower or higher than the exercise price per share
of the canceled Options, or (ii) unless doing so would have the effect of
causing an ISO to be treated as a Non-Qualified Option, the amendment of the
terms of any and all outstanding Options to provide an exercise price per share
which is higher or lower than the then-current exercise price per share of such
outstanding Options.
9. Exercise of Options.
-------------------
A. Each Option granted under the Plan shall be exercisable either in full
or in installments at such time or times and during such period as shall be set
forth in the agreement evidencing the Option, subject to the provisions of the
Plan. Unless doing so would have the effect of causing an ISO to be treated as
a Non-Qualified Option, the Board may, in its sole discretion, after
consideration of such factors as it considers relevant (which may include the
impact, if any, on the Company's financial statements of such change in the
terms of the Option or Options), (i) accelerate the date or dates on which all
or any particular Option or Options granted under the Plan may be exercised or
(ii) extend the dates during which all, or any particular, Option or Options
granted under the Plan may be exercised.
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B. Options granted under the Plan may provide for payment of the exercise
price by delivery of cash or a check payable to the order of the Company, or,
to the extent (if at all) provided in the option agreement (i) by delivery to
- ----------------------------------------------------------
the Company of shares of Common Stock of the Company already owned by the
optionee having a fair market value determined by the Board to be equal in
amount to the exercise price of the Options being exercised, or (ii) by delivery
of a recourse promissory note of the optionee bearing interest payable not less
than annually at the applicable Federal rate as defined in Section 1274(d) of
the Code and otherwise payable on such terms as are specified by the Board, or
(iii) by requesting that the Company withhold shares of Common Stock of the
Company issuable upon exercise of the Options having a fair market value
determined by the Board to be equal in amount to the exercise price of the
Options being exercised, or (iv) by any combination of the above methods of
payment.
10. Option Period. Subject to earlier termination under other provisions
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of this Plan, each Option and all rights thereunder shall expire on such date as
shall be set forth in the applicable option agreement, except that, in the case
of an ISO, such expiration date (the "Expiration Date") shall not be later than
ten years after the date on which the ISO is granted and, in the case of an ISO
granted to a 10% Shareholder as defined in Subparagraph 7B of this Plan, such
expiration date shall not be later than five years after the date on which the
ISO is granted.
11. Nontransferability of Options. ISOs shall not be assignable or
-----------------------------
transferable by the optionee, either voluntarily or by operation of law, except
by will or the laws of descent and distribution, and, during the life of the
optionee, shall be exercisable only by the optionee. The foregoing restrictions
shall also apply to Non-Qualified Options except to the extent otherwise
provided in the agreement evidencing the Non-Qualified Option.
12. Effect of Termination of Employment or Other Relationship. Except as
---------------------------------------------------------
otherwise provided in Paragraph 10 and Subparagraph 13C with respect to ISOs,
and subject to all other provisions of the Plan, the Board shall determine the
period of time during which an optionee may exercise an Option following (i) the
termination of the optionee's employment or other relationship with the Company
or a Related Corporation or (ii) the death or disability of the optionee. Such
periods shall be set forth in the agreement evidencing the Option.
13. Additional ISO Requirements. ISOs granted under the Plan are subject
---------------------------
to the minimum exercise price rules set forth in Subparagraph 7B hereof, the
option period rules of Paragraph 10 hereof, and various other restrictions set
forth elsewhere in this Plan. In addition, ISOs granted under the Plan are
subject to the following:
A. Each ISO granted under the Plan shall, at the time of grant, be
specifically designated as such in the option agreement evidencing such Option.
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B. In no event shall the aggregate fair market value (determined at the
time an ISO is granted) of Common Stock for which ISOs granted to any employee
are exercisable for the first time by such employee during any calendar year
(under all stock option plans of the Company and any Related Corporation) exceed
One Hundred Thousand Dollars ($100,000); provided, however, that this
Subparagraph B shall have no force or effect if its inclusion in the Plan is not
necessary for Options issued as ISOs to qualify as incentive stock options
within the meaning of Section 422 of the Code. Any Option which would, but for
its failure to satisfy the foregoing restriction, qualify as an ISO shall
nevertheless be a valid Option, but to the extent of such failure it shall be
deemed to be a Non-Qualified Option.
C. No ISO may be exercised unless, at the time of such exercise, the
optionee is, and has been continuously since the date of grant of the ISO,
employed by the Company or a Related Corporation, except that:
(i) An ISO may be exercised within the period of three (3) months
after the date the optionee ceases to be an employee of the Company and any
Related Corporation (or within such lesser period as may be specified in
the option agreement); provided, however, that the option agreement may
designate a longer exercise period, in which case the exercise after such
three-month period shall be treated as the exercise of a Non-Qualified
Option.
(ii) If the optionee dies while in the employ of the Company or a
Related Corporation, or within three (3) months after the optionee ceases
to be such an employee of the Company or a Related Corporation, the ISO may
be exercised by the person to whom it is transferred by will or the laws of
descent and distribution within the period of one (1) year after the date
of death (or within such lesser period as may be specified in the option
agreement).
(iii) If the optionee becomes disabled (within the meaning of Section
22(e)(3) of the Code) while in the employ of the Company or a Related
Corporation, the ISO may be exercised within the period of one (1) year
after the date the optionee's employment ceases because of such disability
(or within such lesser period as may be specified in the option agreement).
For all purposes of the Plan and any agreement evidencing an Option,
"employment" shall be defined in accordance with the provisions of Treasury
Regulation Section 1.421-7(h) under the Code (or any successor regulations).
Notwithstanding the foregoing provisions, no ISO may be exercised after its
Expiration Date.
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14. Adjustments.
-----------
A. If, through or as a result of any merger, consolidation, sale of all or
substantially all of the assets of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split, holding company formation or other similar transaction, (i) the
outstanding shares of Common Stock are increased, decreased or exchanged for a
different number or kind of shares or other securities of the Company or a
corporation or other entity controlled by or controlling the Company, or (ii)
additional shares or new or different shares or other securities of the Company
or other non-cash property is distributed with respect to such shares of Common
Stock or other securities, an appropriate and proportionate adjustment shall be
made in (a) the maximum number and kind of shares reserved for issuance under
the Plan, (b) the number and kind of shares or other securities subject to any
then outstanding Options under the Plan, and (c) the price for each share
subject to any then outstanding Options under the Plan, without changing the
aggregate purchase price as to which such Options remain exercisable. No
fractional shares shall be issued under the Plan on account of any such
adjustments. Notwithstanding the foregoing provisions of this Subparagraph A,
no adjustment shall be made pursuant to this Paragraph 14 if such adjustment
would cause any ISO granted under the Plan to fail to qualify as an incentive
stock option within the meaning of Section 422 of the Code.
B. Any adjustments under this Paragraph 14 shall be made by the Board of
Directors, whose determination as to what adjustments, if any, will be made and
the extent thereof shall be final, binding and conclusive.
15. Rights as a Shareholder. The holder of an Option shall have no rights
-----------------------
as a shareholder with respect to any shares covered by the option (including,
without limitation, any voting rights, the right to inspect or receive the
Company's balance sheets or financial statements or any rights to receive
dividends or non-cash distributions with respect to such shares) until the date
of issue of a stock certificate for such shares. No adjustment shall be made
for dividends or other rights for which the record date is prior to the date
such stock certificate is issued.
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16. Merger, Consolidation, Asset Sale, Liquidation, Etc.
---------------------------------------------------
A. Except as may otherwise be provided in the applicable option agreement,
in the event of a consolidation or merger or sale of all or substantially all of
the assets of the Company in which outstanding shares of Common Stock are
exchanged for securities, cash or other property of any other corporation or
business entity, or in the event of the liquidation of the Company (any of such
events, a "Liquidity Event") the Board, or the board of directors of any
corporation assuming the obligations of the Company, shall, in its discretion,
take any one or more of the following actions, as to outstanding Options: (i)
provide that such Options (excluding any such Options which are terminated in
accordance with the provisions of (iii). (iv) or (v) hereinbelow) shall be
assumed, or equivalent options shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof), provided, however, that any
such Options substituted for ISOs shall meet the requirements of Section 424(a)
of the Code; (ii) exercise the discretion granted it under Paragraph 9A of this
Plan to accelerate the date or dates on which all or any particular Option or
Options granted under the Plan may be exercised; (iii) in the event of a merger
(or consolidation) or purchase (or exchange) of the Company's stock, under the
terms of which holders of the Common Stock of the Company will receive upon
consummation thereof cash, stock, indebtedness, any other property, or any
combination of the foregoing ("Consideration"), in exchange for each share
purchased or surrendered in the merger, terminate, in the Board's sole
discretion, either (a) each outstanding Option or (b) each outstanding Option
which is exercisable in full as of the date of such consummation, in exchange
for a payment, made or provided for by the Company, equal in amount to the
excess, if any, of the value (as determined by the Board in its sole discretion,
such determination to be final, binding and conclusive) of the Consideration
over the per-share exercise price of each such Option, times the number of
shares of Common Stock subject to such Option, such payment to consist, to the
extent practicable, of proportional amounts of cash, stock, indebtedness, other
property, or combination of the foregoing as constitutes the Consideration, and
to the extent not so practicable, in cash; or (iv) in the event of a purchase of
the Company's assets, under the terms of which holders of the Common Stock of
the Company will receive upon liquidation of the Company following the
consummation thereof cash, stock, indebtedness, any other property, or any
combination of the foregoing ("Consideration"), terminate, in the Board's sole
discretion, either (a) each outstanding Option or (b) each outstanding Option
which is exercisable in full as of the date of such liquidation, in exchange for
a payment, made or provided for by the Company, equal in amount to the excess,
if any, of the value (as determined by the Board in its sole discretion, such
determination to be final, binding and conclusive) of the Consideration over the
per-share exercise price of each such Option, times the number of shares of
Common Stock subject to such Option, such payment to consist, to the extent
practicable, of proportional amounts of cash, stock, indebtedness, other
property, or combination of the foregoing as constitutes the Consideration, and
to the extent not so practicable, in cash; or (v) terminate, in the Board's sole
discretion, either (a) each outstanding Option or (b) each outstanding Option
which is exercisable in full as of the date of the Liquidity Event, in exchange
for a cash payment equal in amount to the product of the excess, if any, of the
fair market value of a share of Common Stock over the per-share exercise price
of each such Option, times the number of shares subject to such Option. The
Board shall determine the fair market value of a share of Common Stock for
purposes of the foregoing, and the Board's determination of such fair market
value shall be final, binding and conclusive.
B. The Company may grant Options under the Plan in substitution for
Options held by employees of another corporation who become employees of the
Company or a Related Corporation as the result of a merger or consolidation of
the employing corporation with the Company or a Related Corporation, or as a
result of the acquisition by the Company or a Related Corporation of property or
stock of the employing corporation. The Company may direct that substitute
Options be granted on such terms and conditions as the Board considers
appropriate in the circumstances.
-13-
<PAGE>
17. Stock Restriction Agreement. As a condition to the grant of an Award
---------------------------
or a Purchase authorization under the Plan, the recipient of the Award or
Purchase authorization may be required to execute an agreement ("Stock
Restriction Agreement") in such form not inconsistent with the Plan as may be
approved by the Board. Stock Restriction Agreements may differ among
recipients. Stock Restriction Agreements may include any provisions the Board
determines should be included and that are not inconsistent with any provision
of the Plan.
18. No Special Employment Rights. Nothing contained in the Plan or in any
----------------------------
option agreement or other agreement or instrument executed pursuant to the
provisions of the Plan shall confer upon any optionee any right with respect to
the continuation of his or her employment by the Company or any Related
Corporation or interfere in any way with the right of the Company or a Related
Corporation at any time to terminate such employment or to increase or decrease
the compensation of the optionee.
19. Other Employee Benefits. Except as to plans which by their terms
-----------------------
include such amounts as compensation, no amount of compensation deemed to be
received by an employee as a result of the grant or exercise of an Option or the
sale of shares received upon such exercise, or as a result of the grant of an
Award or the authorization or making of a Purchase will constitute compensation
with respect to which any other employee benefits of such employee are
determined, including, without limitation, benefits under any bonus, pension,
profit-sharing, life insurance or salary continuation plan, except as otherwise
specifically determined by the Board.
20. Amendment of the Plan.
---------------------
A. The Board may at any time, and from time to time, modify or amend the
Plan in any respect, except as otherwise expressly provided in this Plan;
provided, however, that if at any time the approval of the shareholders of the
Company is required under the Code with respect to ISOs, or is required under
Rule 16b-3, the Board may not effect such modification or amendment without such
approval.
B. The termination or any modification or amendment of the Plan shall not,
without the consent of an optionee, affect the optionee's rights under an Option
previously granted. With the consent of the optionee affected, the Board may
amend outstanding option agreements in a manner not inconsistent with the Plan.
The Board shall have the right to amend or modify (i) the terms and provisions
of the Plan and of any outstanding ISO granted under the Plan to the extent
necessary to qualify any or all such Options for such favorable federal income
tax treatment (including deferral of taxation upon exercise) as may be afforded
incentive stock options within the meaning of Section 422 of the Code, and (ii)
the terms and provisions of the Plan and of any outstanding Option to the extent
necessary to ensure the qualification of the Plan under Rule 16b-3.
21. Investment Representations. The Board may require any person to whom
--------------------------
an Option is granted, as a condition of exercising such Option, and any person
to whom an Award is granted or a Purchase is authorized, as a condition thereof,
to give written assurances in substance and form satisfactory to the Board to
the effect that such person is acquiring the Common Stock subject to the Option,
Award or Purchase for such person's own account for investment and not with any
present intention of selling or otherwise distributing the same, and to such
other effects as the Company deems necessary or appropriate in order to comply
with federal and applicable state securities laws, or with covenants or
representations made by the Company in connection with any public offering of
its Common Stock.
-14-
<PAGE>
22. Compliance With Securities Laws. Each Option shall be subject to the
-------------------------------
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject to such Option
upon any securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
thereunder, such Option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions acceptable to
the Board. Nothing herein shall be deemed to require the Company to apply for
or to obtain such listing, registration or qualification, or to satisfy such
condition.
23. Withholding. The Company shall have the right to deduct from payments
-----------
of any kind otherwise due to the optionee any federal, state or local taxes of
any kind required by law to be withheld with respect to any shares issued upon
exercise of Options under the Plan or upon the grant of an Award, the making of
a Purchase of Common Stock for less than its fair market value, the making of a
Disqualifying Disposition (as defined in Paragraph 24), or the vesting of
restricted Common Stock acquired pursuant to a Stock Right. The Board in its
sole discretion may condition the exercise of an Option, the grant of an Award,
the making of a Purchase, or the vesting of restricted shares acquired by
exercising a Stock Right on the grantee's payment of such additional withholding
taxes. Subject to the prior approval of the Company, which may be withheld by
the Company in its sole discretion, the grantee may elect to satisfy such
obligations, in whole or in part, (i) by causing the Company to withhold shares
of Common Stock otherwise issuable pursuant to the exercise of a Stock Right or
(ii) by delivering to the Company shares of Common Stock already owned by the
grantee. The shares so delivered or withheld shall have a fair market value
equal to such withholding obligation, and shall not be subject to any
repurchase, forfeiture, unfulfilled vesting or other similar requirements. The
fair market value of the shares used to satisfy such withholding obligation
shall be determined by the Company as of the date that the amount of tax to be
withheld is to be determined. Notwithstanding the foregoing, in the case of a
Reporting Person, no election to use shares for the payment of withholding taxes
shall be effective unless made in compliance with any applicable requirements of
Rule 16b-3 (unless it is intended that the transaction not qualify for exemption
under Rule 16b-3).
24. Notice to Company of Disqualifying Disposition. Each employee who
----------------------------------------------
receives an ISO must agree to notify the Company in writing immediately after
the employee makes a Disqualifying Disposition, as hereinafter defined, of any
Common Stock acquired pursuant to the exercise of an ISO. A Disqualifying
Disposition is any disposition (including any sale) of such Common Stock before
the later of (a) two (2) years after the date the employee was granted the ISO
or (b) one (1) year after the date the employee acquired Common Stock by
exercising the ISO. If the employee has died before such stock is sold, these
holding period requirements do not apply and no Disqualifying Disposition can
occur thereafter.
-15-
<PAGE>
25. Effective Date and Duration of the Plan.
---------------------------------------
A. The Plan shall become effective when adopted by the Board, but no Stock
Right granted under the Plan shall become exercisable unless and until the Plan
shall have been approved by the Company's shareholders. If such shareholder
approval is not obtained within twelve months after the date of the Board's
adoption of the Plan, Stock Rights previously granted under the Plan shall not
vest and shall terminate and shall be null and void and no Stock Rights shall be
granted thereafter under the Plan. Amendments to the Plan not requiring
shareholder approval shall become effective when adopted by the Board;
amendments requiring shareholder approval shall become effective when adopted by
the Board, but no stock Right granted after the date of such amendment shall
become exercisable (to the extent that such amendment to the Plan was required
to enable the Company to grant such stock Right to a particular person) unless
and until such amendment shall have been approved by the Company's shareholders.
If such shareholder approval is not obtained within twelve months of the Board's
adoption of such amendment, any Stock Rights granted on or after the date of
such amendment shall terminate and become null and void to the extent that such
amendment was required to enable the Company to grant such Stock Rights to a
particular person. Subject to this limitation, Stock Rights may be granted
under the Plan at any time after the effective date and before the termination
date of the Plan.
B. Unless sooner terminated as provided elsewhere in this Plan, this Plan
shall terminate upon the close of business on the day next preceding the tenth
anniversary of the date of its adoption by the Board. Stock Rights outstanding
on such date shall continue to have force and effect in accordance with the
provisions of the instruments evidencing such Stock Rights.
Adopted by the Board of Directors on September 10, 1999.
-16-
<PAGE>
Exhibit 4.2
ADVANCED LUMITECH, INC.
Incentive Stock Option Agreement
Advanced Lumitech, Inc., a Nevada corporation (the "Company"), hereby
grants this ___ day of , 199__ (the "Grant Date"), to (the
"Employee"), an option to purchase a maximum of (____) shares of the
Company's Common Stock, $.001 par value per share (the "Common Stock"), at the
price of $ ____ per share, on the following terms and conditions:
1. Grant Under 1999 Stock Option/Stock Issuance Plan. (a) This option is
-------------------------------------------------
granted pursuant to and is governed by and subject to the Company's 1999 Stock
Option/Stock Issuance Plan (the "Plan"), the terms and conditions of which are
incorporated herein by this reference. Unless the context otherwise requires,
terms used herein shall have the same meaning as in the Plan. Determinations
made pursuant to the Plan in connection with this option shall be governed by
the Plan as it exists on the date of this option agreement ("Agreement").
(b) The granting of this option shall be subject to receipt by the
Company of the Company's current form of Non-Disclosure, Non-Competition and
Developments Agreement, executed and delivered by the Employee.
2. Grant as Incentive Stock Option, Other Options. This option is intended
----------------------------------------------
to qualify as an incentive stock option ("ISO") within the meaning of Section
422 of the Internal Revenue Code of 1986 (the "Code"). This option is in
addition to any other options heretofore or hereafter granted to the Employee by
the Company, but a duplicate original of this instrument shall not effect the
grant of another option.
3. Exercise of Option and Provisions for Termination.
-------------------------------------------------
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
----------------
and subject to all other terms and conditions of this Agreement, if the Employee
has continued to be employed by the Company through any applicable date in the
table below, this option may be exercised prior to the tenth anniversary of the
Grant Date (hereinafter the "Expiration Date") in installments for not more than
the number of shares set forth opposite such applicable date:
As of the Grant Date 0 shares
_________, 2000 an additional shares
_________, 2001 an additional shares
_________, 2002 an additional shares
_________, 2003 an additional shares
_________, 2004 an additional shares
The right of exercise shall be cumulative so that if the option is not
exercised to the maximum extent permissible as of an applicable date, it shall
be exercisable, in whole or in part, with respect to all shares not so purchased
at any time prior to the Expiration Date or the earlier termination of this
option. Notwithstanding any other provision of this Agreement or the Plan, this
option may not be exercised at any time on or after the Expiration Date.
<PAGE>
(b) Method of Exercise. Subject to the terms and conditions set forth
------------------
in this Agreement, this option shall be exercised by the Employee's delivery of
written notice of exercise to the President or Treasurer of the Company,
specifying the number of shares to be purchased and the purchase price to be
paid therefor and accompanied by payment in full in accordance with Section 4
hereof. Such exercise shall be effective upon receipt by the President or
Treasurer of the Company of such written notice together with the required
payment. The Employee may purchase less than the number of shares covered
hereby, provided that no partial exercise of this option may be for any
fractional share or for fewer than 500 whole shares.
(c) Continuous Employment Required. Except as otherwise provided in
------------------------------
this Section 3, this option may not be exercised unless the Employee, at the
time he or she exercises this option, is, and has been at all times since the
Grant Date, an employee of the Company. For all purposes of this Agreement, (i)
"employee" and "employment" shall be defined in accordance with the provisions
of Treasury Regulation Section 1.421-7(h) under the Code, or any successor
regulations, (ii) employment by a parent or subsidiary corporation of the
Company shall be deemed to be employment by the Company and (iii) if this option
shall be assumed or a new option substituted therefor in a transaction to which
Section 424(a) of the Code applies, employment by such assuming or substituting
corporation (hereinafter a "Successor Corporation") shall be considered for all
purposes of this option to be employment by the Company. As used herein, the
terms "parent" and "subsidiary" mean "parent corporation" and "subsidiary
corporation", respectively, as those terms are defined in Sections 424(e) and
424(f) or successor provisions of the Code.
(d) Exercise Period Upon Termination of Employment. If the Employee
----------------------------------------------
ceases to be employed by the Company for any reason, then, except as provided in
paragraphs (e) and (f) below, the right to exercise this option shall terminate
on the date which is three (3) months after the date of cessation of employment
(but in no event after the Expiration Date); provided, however, that this option
shall be exercisable only to the extent that the Employee was entitled to
exercise this option on the date of such cessation. Notwithstanding the
foregoing, if, in the judgment of the Company, the Employee, prior to the
Expiration Date, materially violates the non-competition or confidentiality
provisions of any employment contract, confidentiality and nondisclosure
agreement or other agreement between the Employee and the Company, the right to
exercise this option shall terminate immediately upon written notice to the
Employee from the Company describing such violation.
(e) Exercise Period Upon Death or Disability. If the Employee dies or
----------------------------------------
becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to
the Expiration Date while he or she is an employee of the Company, or if the
Employee dies within three (3) months after the date on which the Employee
ceases to be an employee of the Company (other than as the result of a discharge
for "cause" as specified in Paragraph (f) below), this option shall be
exercisable within the period of one (1) year following the date of death or
disability of the Employee (but in no event after the Expiration Date), by the
Employee or by the person to whom this option is transferred by will or the laws
of descent and distribution; provided, however, that this option shall be
exercisable only to the extent that this option was exercisable by the Employee
on the date of his or her death or disability. Except as otherwise indicated by
the context, the term "Employee", as used in this Agreement, shall include the
estate of the Employee, the Employee's personal representative, or any other
person who acquires the right to exercise this option by bequest or inheritance
or otherwise by reason of the death of the Employee or by reason of the
Employee's incapacity.
2
<PAGE>
(f) Discharge for Cause. If the Employee, prior to the Expiration
-------------------
Date, is discharged by the Company for "cause" (as defined below), the right to
exercise this option shall terminate immediately upon such discharge. "Cause"
shall mean willful misconduct or willful failure by the Employee to perform his
or her employment responsibilities in the best interests of the Company
(including, without limitation, breach by the Employee of any provision of any
employment, nondisclosure, non-competition or other similar agreement between
the Employee and the Company), as determined by the Company, which determination
shall be conclusive. The Employee shall be considered to have been discharged
"for cause" if the Company determines, within thirty (30) days after the
Employee's resignation, that discharge for cause was warranted.
4. Payment of Purchase Price. Payment of the purchase price for shares
-------------------------
purchased upon exercise of this option shall be made by delivery to the Company
of cash or wire transfer or a check payable to the order of the Company in an
amount equal to the purchase price per share as hereinabove set forth times the
number of shares so purchased (the "exercise price").
5. Delivery of Shares.
------------------
(a) General. The Company shall, upon payment of the exercise price
-------
for the number of shares purchased and paid for, make prompt delivery of such
shares to the Employee; provided, however, that if any law or regulation
requires the Company to take any action with respect to such shares before the
issuance thereof, then the date of delivery of such shares shall be extended for
the period necessary to complete such action.
(b) Listing, Registration, Qualification, Etc. This option shall be
-----------------------------------------
subject to the requirement that if, at any time, counsel to the Company shall
determine that the listing, registration or qualification of the shares subject
hereto upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, or that the
disclosure of non-public information or the satisfaction of any other condition
is necessary as a condition of, or in connection with, the issuance or purchase
of shares hereunder, this option may not be exercised, in whole or in part,
unless such listing, registration, qualification, consent or approval,
disclosure or satisfaction of such other condition shall have been effected or
obtained on terms acceptable to the Board of Directors of the Company. Nothing
herein shall be deemed to require the Company to apply for, effect or obtain
such listing, registration, qualification, or disclosure, or to satisfy such
other condition.
3
<PAGE>
6. Nontransferability of Option. Except as provided in Paragraph (e) of
----------------------------
Section 3 hereof, this option is personal and no rights granted hereunder may be
transferred, assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) nor shall any such rights be subject to execution,
attachment or similar process. Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this option or of such rights contrary to
the provisions hereof, or upon the levy of any attachment or similar process
upon this option or such rights, this option and such rights shall, at the
election of the Company, become null and void.
7. No Special Employment Rights. Nothing contained in the Plan or this
----------------------------
Agreement shall be construed or deemed by any person under any circumstances to
obligate the Company to continue the employment of the Employee for any period.
8. Rights as a Shareholder. The Employee shall have no rights as a
-----------------------
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to vote or to receive
dividends or other distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Employee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Adjustment Provisions.
---------------------
(a) General. If through, or as a result of, any merger,
-------
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Employee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Paragraph 14 of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under this
-----------------------------------
Section 9 shall be made by the Board of Directors of the Company, whose
determination as to what adjustments, if any, will be made and the extent
thereof will be final, binding and conclusive. No fractional shares will be
issued with respect to this option on account of any such adjustments.
(c) Limits on Adjustments. No adjustment shall be made under this
---------------------
Section 9 which would, for purposes of any applicable provision of the Code,
constitute a modification, extension or renewal of this option or a grant of
additional benefits to the Employee.
4
<PAGE>
10. Mergers, Consolidations, Asset Sales, Liquidations, Etc. In the event
-------------------------------------------------------
of a consolidation or merger or sale of all or substantially all of the assets
of the Company in which outstanding shares of Common Stock are exchanged for
securities, cash or other property of any other corporation or business entity,
or in the event of the liquidation of the Company, prior to the Expiration Date
or other termination of this option, the Employee shall, with respect to this
option or any unexercised portion hereof, be entitled to the rights and
benefits, and be subject to the limitations, set forth in Paragraph 16 of the
Plan.
11. Withholding of Taxes. The Company's obligation to deliver shares upon
--------------------
the exercise of this option shall be subject to the Employee's satisfaction of
all applicable federal, state and local income and employment tax withholding
requirements as described in Paragraph 23 of the Plan. Without limiting the
generality of the foregoing, if the Company in its discretion determines that it
is obligated to withhold tax with respect to a Disqualifying Disposition (as
defined in Section 12 hereof), the Employee agrees that the Company may withhold
from the Employee's wages the appropriate amount of federal, state and local
withholding taxes attributable to such Disqualifying Disposition. If any
portion of this option is treated as a Non-Qualified Option, the Employee agrees
that the Company may withhold from the Employee's wages the appropriate amount
of federal, state and local withholding taxes attributable to the Employee's
exercise of such Non-Qualified Option. At the Company's discretion, the amount
required to be withheld may be withheld in cash from such wages, or otherwise as
may be permitted under the Plan. The Employee further agrees that, if the
Company does not withhold an amount from the Employee's wages sufficient to
satisfy the Company's withholding obligation or if such obligation is not
otherwise satisfied, as determined by the Company, the Employee will reimburse
the Company on demand, in cash, for the amount underwithheld.
12. Holding Period Requirements for Incentive Stock Option Shares. It is
-------------------------------------------------------------
understood and intended that this option shall qualify as an "incentive stock
option" as defined in Section 422 of the Code (an "ISO"). Accordingly, the
Employee understands that in order to obtain the beneficial tax treatment
accorded an ISO, no sale or other disposition may be made of any shares acquired
upon exercise of the option within one (1) year after the day of the transfer of
such shares to the Employee, nor within two (2) years after the Grant Date. If
the Employee intends to dispose, or does dispose (whether by sale, exchange,
gift, transfer or otherwise), of any such shares within either of said periods,
he or she will notify the Company in writing within ten (10) days after such
disposition (a "Disqualifying Dispositions").
13. Investment Representations, Warranties and Covenants; Legends.
-------------------------------------------------------------
(a) Representations. The Employee represents, warrants and covenants
---------------
that:
(i) Any shares purchased upon exercise of this option shall be
acquired for the Employee's account for investment only and not with a view to,
or for sale in connection with, any distribution of the shares in violation of
the Securities Act of 1933 (the "Securities Act") or any rule or regulation
under the Securities Act.
5
<PAGE>
(ii) The Employee has had such opportunity as he or she has deemed
adequate to obtain from representatives of the Company such information as is
necessary to permit the Employee to evaluate the merits and risks of his or her
investment in the Company.
(iii) The Employee is able to bear the economic risk of holding shares
acquired pursuant to the exercise of this option for an indefinite period.
(iv) The Employee understands that (A) the shares acquired pursuant to
the exercise of this option will not be registered under the Securities Act and
are "restricted securities" within the meaning of Rule 144 under the Securities
Act; (B) such shares cannot be sold, transferred or otherwise disposed of unless
they are subsequently registered under the Securities Act or an exemption from
registration is then available; (C) in any event, an exemption from registration
under Rule 144 or otherwise under the Securities Act may not be available for at
least two years and even then will not be available unless a public market then
exists for the Common Stock, adequate information concerning the Company is then
available to the public and other terms and conditions of Rule 144 are complied
with; and (D) there is now no registration statement on file with the Securities
and Exchange Commission with respect to any stock of the Company and the Company
has no obligation or current intention to register any shares acquired pursuant
to the exercise of this option under the Securities Act.
(v) The Employee agrees that, if the Company offers for the first time
any of its Common Stock for sale pursuant to a registration statement under the
Securities Act, the Employee will not, without the prior written consent of the
Company, publicly offer, sell, contract to sell or otherwise dispose of,
directly or indirectly, any shares purchased upon exercise of this option for a
period of ninety (90) days, or such longer period as the Company may reasonably
require, after the effective date of such registration statement.
(vi) The Employee's principal residence is at the address set forth
below on the signature page. The Employee shall promptly notify the Company of
any change in the Employee's principal residence.
By making payment upon any exercise of this option, in whole or in part, the
Employee shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 13.
6
<PAGE>
(b) Legends on Stock Certificates. All stock certificates
-----------------------------
representing shares of Common Stock issued to the Employee upon exercise of this
option shall have affixed thereto legends substantially in the following forms,
in addition to any other legends required by applicable state law:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 and may not be
transferred, sold or otherwise disposed of in the absence of an
effective registration statement with respect to the shares evidenced
by this certificate, filed and made effective under the Securities Act
of 1933, or an opinion of counsel satisfactory to the Company to the
effect that registration under such Act is not required."
14. Miscellaneous.
-------------
(a) Except as otherwise expressly provided herein, this Agreement may
not be amended or otherwise modified unless evidenced in writing and signed by
the Company and the Employee.
(b) All notices under this Agreement shall be delivered by hand, sent
by commercial overnight courier service or sent by registered or certified mail,
return receipt requested, and first-class postage prepaid, to the parties at
their respective addresses set forth beneath their names below or at such other
address as may be designated in a notice by either party to the other.
Notwithstanding the foregoing, any notice sent to such an address in a country
other than that from which the notice is sent may be sent by telefax, telegram
or commercial air courier.
(c) Any reference in this Agreement to a Section of the Code shall
refer to that Section as it reads as of the date of this Agreement and as it may
be amended from time to time, and to any successor provision.
(d) Each provision of this Agreement shall be considered separable.
The invalidity or unenforceability of any provision shall not affect the other
provisions, and this Agreement shall be construed in all respects as if such
invalid or unenforceable provision were omitted.
(e) Sections 12, 13, and 14 hereof shall survive any termination of
this Agreement.
(f) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
(g) The failure of the Company or the Employee to insist upon strict
performance of any provision hereunder, irrespective of the length of time for
which such failure continues, shall not be deemed a waiver of such party's right
to demand strict performance at any time in the future. No consent or waiver,
express or implied, to or of any breach or default in the performance of any
obligation or provision hereunder shall constitute a consent or waiver to or of
any other breach or default in the performance of the same or any other
obligation hereunder.
7
<PAGE>
(h) Except for the right of any party to apply to a court of competent
jurisdiction for a temporary restraining order, preliminary injunction, or other
equitable relief to preserve the status quo or prevent irreparable harm pending
the selection and confirmation of an arbitrator, any controversy or claim
arising out of or relating to this Agreement, including without limitation
claims under the Americans with Disabilities Act, the Age Discrimination in
Employment Act of 1967, as amended, Title VII of the Civil Rights Act of 1964 as
amended, Massachusetts General Laws Chapter 151B], or any other applicable state
or federal statutory or common law; shall be resolved by arbitration in Boston,
Massachusetts, in accordance with the governing rules of the American
Arbitration Association (the "AAA"). A demand for arbitration shall be filed
with the AAA during the term, or within six months after termination or
expiration, of this Agreement. The arbitrator shall have the authority to
permit discovery, to the extent deemed appropriate by the arbitrator, upon the
request of a party and to grant any type of injunctive relief as well as award
damages; provided, however, the arbitrator shall have no authority to award
multiple or punitive damages. The costs of the arbitration proceeding,
including the fee of the arbitrator, shall be borne equally by the parties.
Each party shall bear the costs of its own counsel. Judgment upon the award
entered may be enforced by any court of competent jurisdiction.
Date of Grant: ________________________________, 199__.
Advanced Lumitech, Inc.
By: __________________________
Title: _________________________
Address:
______________________________
______________________________
Employee's Acceptance
The undersigned hereby accepts the foregoing option and agrees to the terms
and conditions of this Agreement. The undersigned hereby acknowledges receipt
of a copy of the Company's 1999 Stock Option/Stock Issuance Plan.
[Name of Employee]
______________________________
Signature
Address:_____________________
8
<PAGE>
Exhibit 4.3
ADVANCED LUMITECH, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
Advanced Lumitech, Inc., a Nevada corporation (the "Company"), hereby
grants this ___ day of , 199__ (the "Grant Date"), to (the
"Employee"), an option to purchase a maximum of (____) shares of the
Company's Common Stock, $.001 par value per share (the "Common Stock"), at the
price of $ ____ per share, on the following terms and conditions:
1. Grant Under 1999 Stock Option/Stock Issuance Plan. (a) This option is
-------------------------------------------------
granted pursuant to and is governed by and subject to the Company's 1999 Stock
Option/Stock Issuance Plan (the "Plan"), the terms and conditions of which are
incorporated herein by this reference. Unless the context otherwise requires,
terms used herein shall have the same meaning as in the Plan. Determinations
made pursuant to the Plan in connection with this option shall be governed by
the Plan as it exists on the date of this option agreement ("Agreement").
(b) The granting of this option shall be subject to receipt by the
Company of the Company's current form of Non-Disclosure, Non-Competition and
Developments Agreement, executed and delivered by the Optionee.
2. Grant as Non-Qualified Option; Other Options. This option is intended
--------------------------------------------
to be a Non-Qualified Option; it is not intended to qualify as an incentive
stock option within the meaning of Section 422 of the Internal Revenue Code of
1986 (the "Code"). This option is in addition to any other options heretofore
or hereafter granted to the Optionee by the Company, but a duplicate original of
this instrument shall not effect the grant of another option.
3. Exercise of Option and Provisions for Termination.
-------------------------------------------------
(a) Vesting Schedule. Except as otherwise provided in this Agreement,
----------------
and subject to all other terms and conditions of this Agreement, if the Optionee
has continued to have a Business Relationship, as that term is defined in
Paragraph (c) of this Section 3, with the Company through any applicable date in
the table below, this option may be exercised prior to the tenth anniversary of
the Grant Date (hereinafter the "Expiration Date") in installments for not more
than the number of shares set forth opposite such applicable date:
As of the Grant Date shares
, 2000 an additional ______ shares
, 1999 an additional ______ shares
, 2000 an additional ______ shares
, 2001 an additional ______ shares
, 2002 an additional ______ shares
<PAGE>
The right of exercise shall be cumulative so that if the option is not exercised
to the maximum extent permissible as of an applicable date, it shall be
exercisable, in whole or in part, with respect to all shares not so purchased at
any time prior to the Expiration Date or the earlier termination of this option.
Notwithstanding any other provision of this Agreement or the Plan, this option
may not be exercised at any time on or after the Expiration Date.
(b) Method of Exercise. Subject to the terms and conditions set forth in
------------------
this Agreement, this option shall be exercised by the Optionee's delivery of
written notice of exercise to the President or Treasurer of the Company,
specifying the number of shares to be purchased and the purchase price to be
paid therefor and accompanied by payment in full in accordance with Section 4
hereof. Such exercise shall be effective upon receipt by the President or
Treasurer of the Company of such written notice together with the required
payment. The Optionee may purchase less than the number of shares covered
hereby, provided that no partial exercise of this option may be for any
fractional share or for fewer than 500 whole shares.
(c) Continuous Business Relationship Required. Except as otherwise provided
-----------------------------------------
in this Section 3, this option may not be exercised unless the Optionee, at the
time the Optionee exercises this option, is and has been at all times since the
Grant Date, an employee, officer or director of, or consultant or advisor to the
Company (any of such relationships, a "Business Relationship").
(d) Exercise Period Upon Termination of Business Relationship. If the
---------------------------------------------------------
Optionee ceases to have a Business Relationship with the Company, then, except
as provided in paragraphs (e) and (f) below, the right to exercise this option
shall terminate on the date which is three (3) months after the date on which
the Optionee ceases to have any Business Relationship with the Company (but in
no event after the Expiration Date); provided, however, that this option shall
be exercisable only to the extent that the Optionee was entitled to exercise
this option on the date of such cessation. Notwithstanding the foregoing, if, in
the judgment of the Company, the Optionee, prior to the Expiration Date,
materially violates the non-competition or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Optionee and the Company, the right to exercise this
option shall terminate immediately upon written notice to the Optionee from the
Company describing such violation.
2
<PAGE>
(e) Exercise Period Upon Death or Disability. If the Optionee is a natural
----------------------------------------
person who dies or becomes disabled (within the meaning of Section 22(e)(3) of
the Code) prior to the Expiration Date while he or she has a Business
Relationship with the Company, or if such an Optionee dies within three (3)
months after the date on which he or she ceases to have a Business Relationship
with the Company (other than as the result of a discharge for "cause" as
specified in Paragraph (f) below), this option shall be exercisable within the
period of one (1) year following the date of death or disability of the Optionee
(but in no event after the Expiration Date), by the Optionee or by the person to
whom this option is transferred by will or the laws of descent and distribution;
provided, however, that this option shall be exercisable only to the extent that
this option was exercisable by the Optionee on the date of his or her death or
disability. Except as otherwise indicated by the context, the term "Optionee",
as used in this Agreement, shall include the estate of the Optionee, the
Optionee's personal representative, or any other person who acquires the right
to exercise this option by bequest or inheritance or otherwise by reason of the
death of the Optionee or by reason of the Optionee's incapacity.
(f) Discharge for Cause. If the Optionee, prior to the Expiration Date, is
-------------------
discharged by the Company for "cause" (as defined below), the right to exercise
this option shall, terminate immediately upon such discharge. "Cause" shall
mean willful misconduct or willful failure to perform the Optionee's
responsibilities in the best interests of the Company (including, without
limitation, breach by the Optionee of any provision of any employment,
nondisclosure, non-competition or other similar agreement between the Optionee
and the Company), as determined by the Company, which determination shall be
conclusive. The Optionee shall be considered to have been discharged "for
cause" if the Company determines, within thirty (30) days after the Optionee's
resignation, that discharge for cause was warranted.
4. [ALTERNATIVE #1] Payment of Purchase Price. Payment of the purchase
-------------------------
price for shares purchased upon exercise of this option shall be made by
delivery to the Company of cash or wire transfer or a check payable to the order
of the Company in an amount equal to the purchase price per share as hereinabove
set forth times the number of shares so purchased (the "exercise price").
4. [ALTERNATIVE #2] Payment of Purchase Price. Payment of the purchase
-------------------------
price for shares purchased upon exercise of this option shall be made in any of
the following ways: (i) delivery to the Company of cash or wire transfer or a
check payable to the order of the Company in an amount equal to the purchase
price per share as hereinabove set forth times the number of shares so purchased
(the "exercise price"), (ii) by delivery of a recourse promissory note of the
Optionee bearing interest payable not less than annually at the applicable
Federal rate as defined in Section 1274(d) of the Code and otherwise payable on
such terms as are specified by the Board in its sole discretion; (iii) by
delivery to the Company of shares of Common Stock of the Company already owned
by the optionee having a fair market value determined by the Board to be equal
in amount to the exercise price of the Options being exercised; provided,
however, that such shares have been held by the Employee for more than six (6)
months if they were acquired under the Plan; (iv) by any combination of the
above methods of payment.
5. Delivery of Shares.
------------------
(a) General. The Company shall, upon payment of the exercise price
-------
for the number of shares purchased and paid for, make prompt delivery of such
shares to the Optionee; provided, however, that if any law or regulation
requires the Company to take any action with respect to such shares before the
issuance thereof, then the date of delivery of such shares shall be extended for
the period necessary to complete such action.
3
<PAGE>
(b) Listing, Registration, Qualification, Etc. This option shall be
-----------------------------------------
subject to the requirement that if, at any time, counsel to the Company shall
determine that the listing, registration or qualification of the shares subject
hereto upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, or that the
disclosure of nonpublic information or the satisfaction of any other condition
is necessary as a condition of, or in connection with, the issuance or purchase
of shares hereunder, this option may not be exercised, in whole or in part,
unless such listing, registration, qualification, consent or approval,
disclosure or satisfaction of such other condition shall have been effected or
obtained on terms acceptable to the Board of Directors of the Company. Nothing
herein shall be deemed to require the Company to apply for, effect or obtain
such listing, registration, qualification, or disclosure, or to satisfy such
other condition.
6. Nontransferability of Option. Except as provided in Paragraph (e) of
----------------------------
Section 3 hereof, this option is personal and no rights granted hereunder may be
transferred, assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) nor shall any such rights be subject to execution,
attachment or similar process. Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this option or of such rights contrary to
the provisions hereof, or upon the levy of any attachment or similar process
upon this option or such rights, this option and such rights shall, at the
election of the Company, become null and void.
7. No Special Employment or Other Rights. Nothing contained in the Plan or
-------------------------------------
this Agreement shall be construed or deemed by any person under any
circumstances to obligate the Company to continue any employment or other
Business Relationship of the Optionee for any period.
8. Rights as a Shareholder. The Optionee shall have no rights as a
-----------------------
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to vote or to receive
dividends or other distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
4
<PAGE>
9. Adjustment Provisions.
---------------------
(a) General. If through, or as a result of, any merger,
-------
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Paragraph 14 of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under this
-----------------------------------
Section 9 will be made by the Board of Directors of the Company, whose
determination as to what adjustments, if any, will be made and the extent
thereof will be final, binding and conclusive. No fractional shares will be
issued with respect to this option on account of any such adjustments.
10. Mergers, Consolidations, Asset, Sales, Liquidations, Etc. In the event
--------------------------------------------------------
of a consolidation or merger or sale of all or substantially all of the assets
of the Company in which outstanding shares of Common Stock are exchanged for
securities, cash or other property of any other corporation or business entity,
or in the event of the liquidation of the Company, prior to the Expiration Date
or other termination of this option, the Optionee shall, with respect to this
option or any unexercised portion hereof, be entitled to the rights and
benefits, and be subject to the limitations, set forth in Paragraph 16 of the
Plan.
11. Withholding of Taxes. The Company's obligation to deliver shares upon
--------------------
the exercise of this option shall be subject to the Optionee's satisfaction of
all applicable federal, state and local income and employment tax withholding
requirements as described in Paragraph 23 of the Plan. At the Company's
discretion, and to the extent permitted by the Plan, the amount required to be
withheld may be withheld in cash from such wages, or otherwise as may be
permitted under the Plan. The Optionee further agrees that, if the Company does
not withhold an amount from the Optionee's wages sufficient to satisfy the
Company's withholding obligation or if such obligation is not otherwise
satisfied, as determined by the Company, the Optionee will reimburse the Company
on demand, in cash, for the amount underwithheld.
12. Investment Representations, Warranties and Covenants; Legends.
-------------------------------------------------------------
(a) Representations. The Optionee represents, warrants and covenants
---------------
that:
(i) Any shares purchased upon exercise of this option shall be
acquired for the Optionee's account for investment only and not with a view
to, or for sale in connection with, any distribution of the shares in
violation of the Securities Act of 1933 (the "Securities Act") or any rule
or regulation under the Securities Act.
(ii) The Optionee has had such opportunity as the Optionee has deemed
adequate to obtain from representatives of the Company such information as
is necessary to permit the Optionee to evaluate the merits and risks of the
Optionee's investment in the Company.
5
<PAGE>
(iii) The Optionee is able to bear the economic risk of holding
shares acquired pursuant to the exercise of this option for an
indefinite period
(iv) The Optionee understands that (A) the shares acquired
pursuant to the exercise of this option will not be registered under
the Securities Act and are "restricted securities" within the meaning
of Rule 144 under the Securities Act; (B) such shares cannot be sold,
transferred or otherwise disposed of unless they are subsequently
registered under the Securities Act or an exemption from registration
is then available; (C) in any event, an exemption from registration
under Rule 144 or otherwise under the Securities Act may not be
available for at least two years and even then will not be available
unless a public market then exists for the Common Stock, adequate
information concerning, the Company is then available to the public
and other terms and conditions of Rule 144 are complied with; and (D)
there is now no registration statement on file with the Securities and
Exchange Commission with respect to any stock of the Company and the
Company has no obligation or current intention to register any shares
acquired pursuant to the exercise of this option under the Securities
Act.
(v) The Optionee agrees that, if the Company offers for the first
time any of its Common Stock for sale pursuant to a registration
statement under the Securities Act, the Optionee will not, without the
prior written consent of the Company, publicly offer, sell, contract
to sell or otherwise dispose of, directly or indirectly, any shares
purchased upon exercise of this option for a period of ninety (90)
days, or such longer period as the Company may reasonably require,
after the effective date of such registration statement.
(vi) The Optionee's principal residence is at the address set
forth below on the signature page. The Optionee shall promptly notify
the Company of any change in the Optionee's principal address.
By making payment upon any exercise of this option, in whole or in part, the
Optionee shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 12.
(b) Legends on Stock Certificates. All stock certificates representing
-----------------------------
shares of Common Stock issued to the Optionee upon exercise of this option shall
have affixed thereto legends substantially in the following forms, in addition
to any other legends required by applicable state law:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 and may not be
transferred, sold or otherwise disposed of in the absence of an
effective registration statement with respect to the shares evidenced
by this certificate, filed and made effective under the Securities Act
of 1933, or an opinion of counsel satisfactory to the Company to the
effect that registration under such Act is not required."
6
<PAGE>
13. Miscellaneous.
-------------
(a) Except as otherwise expressly provided herein, this Agreement may
not be amended or otherwise modified unless evidenced in writing and signed by
the Company and the Optionee.
(b) All notices under this Agreement shall be delivered by hand, sent
by commercial overnight courier service or sent by registered or certified mail,
return receipt requested, and first-class postage prepaid, to the parties at
their respective addresses set forth beneath their names below or at such other
address as may be designated in a notice by either party to the other.
Notwithstanding the foregoing, any notice sent to such an address in a country
other than that from which the notice is sent may be sent by telefax, telegram
or commercial air courier.
(c) Any reference in this Agreement to a Section of the Code shall
refer to that Section as it reads as of the date of this Agreement and as it may
be amended from time to time, and to any successor provision.
(d) Each provision of this Agreement shall be considered separable.
The invalidity or unenforceability of any provision shall not affect the other
provisions, and this Agreement shall be construed in all respects as if such
invalid or unenforceable provision were omitted.
(e) Sections 12 and 13 hereof shall survive any termination of this
Agreement.
(f) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
(g) The failure of the Company or the Optionee to insist upon strict
performance of any provision hereunder, irrespective of the length of time for
which such failure continues, shall not be deemed a waiver of such party's right
to demand strict performance at any time in the future. No consent or waiver,
express or implied, to or of any breach or default in the performance of any
obligation or provision hereunder shall constitute a consent or waiver to or of
any other breach or default in the performance of the same or any other
obligation hereunder.
7
<PAGE>
(h) Except for the right of any party to apply to a court of competent
jurisdiction for a temporary restraining order, preliminary injunction, or other
equitable relief to preserve the status quo or prevent irreparable harm pending
the selection and confirmation of an arbitrator, any controversy or claim
arising out of or relating to this Agreement, including without limitation
claims under the Americans with Disabilities Act, the Age Discrimination in
Employment Act of 1967, as amended, Title VII of the Civil Rights Act of 1964,
as amended, Massachusetts General Laws Chapter 151 B, or any other applicable
state or federal statutory or common law, shall be resolved by arbitration in
Boston, Massachusetts, in accordance with the governing rules of the American
Arbitration Association (the "AAA"). A demand for arbitration shall be filed
with the AAA during the term, or within six months after termination or
expiration, of this Agreement. The arbitrator shall have the authority to
permit discovery, to the extent deemed appropriate by the arbitrator, upon the
request of a party and to grant any type of injunctive relief as well as award
damages; provided, however, the arbitrator shall have no authority to award
multiple or punitive damages. The costs of the arbitration proceeding,
including the fee of the arbitrator, shall be borne equally by the parties.
Each party shall bear the costs of its own counsel. Judgment upon the award
entered may be enforced by any court of competent jurisdiction.
Date of Grant:
______________________, 199__.
Advanced Lumitech, Inc.
By: __________________________
Title: _________________________
Address:
______________________________
______________________________
Optionee's Acceptance
The undersigned hereby accepts the foregoing option and agrees to the terms
and conditions of this Agreement. The undersigned hereby acknowledges receipt
of a copy of the Company's 1999 Stock Option/Stock Issuance Plan.
[Name of Optionee]
______________________________
Signature
Address:
______________________________
______________________________
8
<PAGE>
EXHIBIT 5.1
[Chappell White LLP Letterhead]
(617) 772 9600
September 24, 1999
Advanced Lumitech, Inc.
36 Avenue Cardinal-Mermillod
Carouge, Switzerland 1227
Re: Registration Statement on Form S-8 Relating to the 1999 Stock
Option/Stock Issuance Plan 401(k) Savings Plan (the "Plan") of
Advanced Lumitech, Inc. (the "Company")
----------------------------------------------------------------------
Dear Sir or Madam:
Reference is made to the above-captioned Registration Statement on Form S-8
(the "Registration Statement") filed by the Company on or about September 27,
1999 with the Securities and Exchange Commission under the Securities Act of
1933, as amended, relating to an aggregate of 5,000,000 shares of Common Stock,
$.001 par value per share, of the Company issuable pursuant to the Plan (the
"Shares").
We have examined, are familiar with, and have relied as to factual matters
solely upon, copies of the Plan, the Articles of Incorporation and the Amended
and Restated By-Laws of the Company, the minute books and stock records of the
Company and originals of such other documents, certificates and proceedings as
we have deemed necessary for the purpose of rendering this opinion.
Based on the foregoing, we are of the opinion that the Shares have been
duly authorized and, when issued in accordance with the terms of the Plan and
duly authorized by the Company's Board of Directors or Compensation Committee,
the Shares will be validly issued, fully paid and nonassessable.
-17-
<PAGE>
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement and any amendments thereto.
Very truly yours,
Chappell White LLP
<PAGE>
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the 1999 Stock Option/Stock Issuance Plan of Advanced
Lumitech, Inc. of our report dated March 31, 1999, with respect to the
consolidated financial statements of Advanced Lumitech, Inc. included in the
Annual Report (Form 10-K) for the year ended December 31, 1998.
Boston, Massachusetts
September 28, 1999
