<PAGE>
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the registrant /X/
Filed by party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
ORYX TECHNOLOGY CORP.
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Oryx Technology Corp.
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
(1) Title of each class of securities to which transaction applies:
- -------------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
- -------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
- -------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
1
<PAGE>
- -------------------------------------------------------------------------------
(5) Total fee paid:
- -------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
- -------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- -------------------------------------------------------------------------------
(3) Filing party:
- -------------------------------------------------------------------------------
(4) Date filed:
- -------------------------------------------------------------------------------
2
<PAGE>
ORYX TECHNOLOGY CORP.
1100 Auburn Street
Fremont, California 94538
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Oryx
Technology Corp., a Delaware corporation (the "Company"), will be held at
1100 Auburn Street, Fremont, California 94538 at 10:00 a.m. on Monday,
October 26, 1998, for the following purposes:
PROPOSAL 1. To elect eight (8) directors of the Company for terms
expiring at the 1999 Annual Meeting;
PROPOSAL 2. To ratify the selection of PricewaterhouseCoopers LLP as
auditors of the Company's financial statements for the fiscal year ending
February 28, 1999;
PROPOSAL 3. To consider and act upon a proposal to approve an increase
in the number of shares which may be granted under the Company's 1993
Incentive and Nonqualified Stock Option Plan to 3,625,000 from 2,625,000
shares;
PROPOSAL 4: To consider and act upon a proposal to approve an increase
in the number of shares which may be granted under the Company's 1996
Directors Non-Qualified Stock Option Plan to 250,000 from 120,000 shares;
and to transact such other business as may properly come before the Annual
Meeting or any adjournments thereof.
The close of business on September 10, 1998 has been fixed as the record
date for the determination of stockholders entitled to notice of and to vote
at the Annual Meeting.
All stockholders are cordially invited to attend the Annual Meeting in
person. To assure your representation at the Annual Meeting, however, you are
urged to mark, sign, date and return the enclosed proxy card as promptly as
possible in the postage-prepaid envelope enclosed for that purpose. Any
stockholder attending the Annual Meeting may vote in person even if such
stockholder has returned a proxy.
3
<PAGE>
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
SIGN, DATE AND PROMPTLY MAIL YOUR PROXY IN THE ENVELOPE PROVIDED FOR YOUR
CONVENIENCE. YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE ANNUAL
MEETING AND, IF YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE YOUR SHARES IN
PERSON.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Andrew Intrater
----------------------------------
Andrew Intrater, Secretary
Dated: September 17, 1998
4
<PAGE>
ORYX TECHNOLOGY CORP.
1100 Auburn Street
Fremont, California 94538
PROXY STATEMENT
------------------------------------------
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Oryx Technology Corp. (the "Company")
for use at the Annual Meeting of Stockholders to be held on October 26, 1998,
or at any adjournments thereof (the "Annual Meeting"), for the purposes set
forth herein and in the foregoing Notice. This Proxy Statement and the
accompanying Proxy are being mailed to the Company's stockholders on or about
September 17, 1998.
At the close of business on September 10, 1998, the record date fixed by
the Board of Directors of the Company for determining those stockholders
entitled to vote at the Annual Meeting (the "Record Date"), the outstanding
shares of the Company entitled to vote consisted of 13,034,821 shares of
Common Stock and 4,500 shares of Series A Preferred Stock. Each stockholder
of record at the close of business on the Record Date is entitled to one vote
for each share then held on each matter submitted to a vote of the
stockholders.
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. The giving of a proxy does not preclude the right to vote in
person should any stockholder giving the proxy so desire. Stockholders have
an unconditional right to revoke their proxy at any time prior to the
exercise thereof, either in person at the Annual Meeting or by filing with
the Company's Secretary at the Company's headquarters a written revocation or
duly executed proxy bearing a later date; however, no such revocation will be
effective until written notice of the revocation is received by the Company
at or prior to the Annual Meeting.
The attendance, in person or by proxy, of the holders of a majority of
the outstanding shares of Common Stock entitled to vote at the Annual Meeting
is necessary to constitute a quorum. Directors will be elected (Proposal 1)
by a plurality of the votes cast by the shares of Common Stock represented in
person or by proxy at the Annual Meeting. Under applicable Delaware state
law, if a quorum exists, action on a matter other than the election of
directors is approved if a majority of shares voting at the Annual Meeting in
person or proxy favor the proposed action. If less than a majority of
outstanding shares entitled to vote are represented at the Annual Meeting, a
majority of the shares so represented may adjourn the Annual Meeting to
another date, time or place, and notice need not be given of the new date,
time or place if the new date, time or place is announced at the meeting
before an adjournment is taken.
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<PAGE>
Abstentions and "broker non-votes" are counted as shares eligible to
vote at the Annual Meeting in determining whether a quorum is present, but do
not represent votes cast with respect to any Proposal. "Broker non-votes" are
shares held by a broker or nominee as to which instructions have not been
received from the beneficial owners or persons entitled to vote and the
broker or nominee does not have discretionary voting power.
A form of proxy is enclosed for use at the Annual Meeting. The proxy may
be revoked by a stockholder at any time prior to the exercise thereof, and
any stockholder at any time prior to the exercise thereof, and any
stockholder present at the Annual Meeting, may revoke his proxy thereat and
vote in person if he or she so desires. When such proxy is properly executed
and returned, the shares it represents will be voted at the Annual Meeting,
in accordance with any instructions noted thereon. If no direction is
indicated, all shares represented by valid proxies received pursuant to this
solicitation (and not revoked prior to exercise) will be voted for the
election of the nominees for directors named herein (unless authority to vote
is withheld) and in favor of all other proposals stated in the Notice of
Annual Meeting and described in this Proxy Statement.
The Company's Annual Report for the fiscal year ended February 28, 1998
is enclosed with this Proxy Statement.
PROPOSAL 1:
ELECTION OF DIRECTORS
NOMINEES
Eight (8) current members of the Board of Directors are to be elected at
the Annual Meeting, each to hold office until the next Annual Meeting and
until their successors are elected and qualified. The Board of Directors has
nominated for election as directors the eight (8) persons indicated in the
following table. In the election of directors, the proxy holders intend,
unless directed otherwise, to vote for the election of the nominees named
below, all of whom are now members of the Board of Directors.
MANAGEMENT RECOMMENDS A VOTE IN FAVOR OF EACH NAMED NOMINEE.
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<PAGE>
The following table gives certain information as to each person
nominated for election as a director and the Company's executive officers:
<TABLE>
<CAPTION>
Director
Name Age Since Positions
- ------------------ ---- -------- ------------------------------------
<S> <C> <C> <C>
Philip J. Micciche 64 1997 President, Chairman, Chief Executive
Officer and Director
Mitchel Underseth 42 1997 Chief Financial Officer and Director
Andrew Intrater 36 1993 Secretary, Treasurer and Director
Dr. John H. Abeles 53 1993 Director
Jay M. Haft 62 1995 Director
Richard Hubbard 38 1997 Director
Doug McBurnie 55 1997 Director
Ted D. Morgan 56 1996 Director
</TABLE>
Except as set forth below, each of the nominees has been engaged in his
principal occupation during the past five years. There is no family
relationship between any director and any executive officer of the Company.
PHILIP J. MICCICHE was elected to serve as the Company's President and
Chief Executive Officer and to serve as a Director of the Company on April
25, 1997. He was elected Chairman of the Company's Board of Directors on
August, 1998. From 1993 through 1995, Mr. Micciche was Chief Executive
Officer of AXCIS Information Networks, a provider of sports information data.
From 1990 through 1992, Mr. Micciche was President of Dysan International
Corp. and oversaw its initial public offering of securities in Hong Kong in
1991. From 1983 through 1990, he held several executive management positions
at Xidex Corp. From 1983 through 1985, Mr. Micciche was Senior Vice President
Marketing at Xidex Magnetics (Xidex merged with Dysan Corp. in 1985). Prior
to 1983, Mr. Micciche has held positions as CEO, Vice President Sales,
Product Sales Manager and Chief Engineer for various companies. He received
his BSEE from Northeastern University in Boston.
MITCHEL UNDERSETH has served as Chief Financial Officer of the Company
since November, 1996, with additional responsibilities for administration and
human resources. Mr. Underseth became a Director of the Company in October
1997. From August 1992 through November 1996, Mr. Underseth was Chief
Financial Officer for Triptych CD/San Joaquin Packaging in Stockton,
California. From March 1990 through April 1992, Mr. Underseth was Chief
Financial Officer for Dysan International/Magnetic L.P. in Hong Kong, a
spin-off of Xidex's Flexible Disk Group. From September 1986 through March
1990, Mr. Underseth was Vice President-Finance for Xidex Flexible Disk Group
and Rigid Oxide Group in Santa Clara, California. Mr. Underseth received his
M.B.A. from the University of Washington in Seattle and his B.S. in Business
from Lewis and Clark College in Portland, Oregon.
7
<PAGE>
ANDREW INTRATER has been a Director, Secretary and Treasurer of the
Company since its organization in July, 1993. He had been employed in various
executive capacities with the Company from its organization in July 1993
until March 1998 when he resigned from the Company's employment following the
sale of the Company's majority ownership position in Oryx Instruments &
Materials Corporation, since renamed as Oryx Instruments Corporation, a
privately held company. Mr. Intrater is currently the President and Chief
Executive Officer of Oryx Instruments Corporation. Mr. Intrater held various
executive positions with ATI, the Company's predecessor corporation, since
1981. Between September, 1988 and May, 1993, Mr. Intrater served as President
of ATI and was a Director since 1983. Mr. Intrater received his B.S. in
Chemical Engineering from Rutgers University and an M.S. in Materials Science
from Columbia University.
JOHN H. ABELES, M.D., has been a Director of the Company since its
organization in July, 1993 and previously of ATI commencing October, 1991. He
was Chairman of the Board of Directors of the Company from October, 1993
until April, 1997. Since March 1992, Dr. Abeles has been a General Partner of
Northlea Partners Ltd. ("Northlea Partners"), Boca Raton, Florida, a private
investment partnership. Since 1980, Dr. Abeles has been President of MedVest,
Inc., Boca Raton, Florida, a business and financial consulting firm. Dr.
Abeles serves on the Board of Directors of I-Flow Corporation, Irvine,
California, a publicly traded company which manufactures infusion devices,
DUSA Pharmaceuticals, Inc., a publicly traded company which is developing
photodynamic therapy products, PharmaPrint, a botanical pharmaceutical
concern and Encore Medical Corporation, an orthopedic company.
JAY M. HAFT has served as Director of the Company since February, 1995.
He is a strategic and financial consultant for growth stage companies. He is
active in international corporate finance, mergers and acquisitions, as well
as in the representation of emerging growth companies. He has actively
participated in strategic planning and fund raising for many high-tech
companies, leading edge medical technology companies and technical product,
service and marketing companies. He is a Managing General Partner of Gen Am
"1" Venture Fund, a domestic and an international venture capital fund. Mr.
Haft is also a Director of numerous public and private corporations,
including Robotic Vision Systems, Inc. (OTC), Noise Cancellation
Technologies, Inc. (OTC), Extech, Inc. (OTC), Encore Medical Corporation
(OTC), PC Service Source, Inc. (OTC), DUSA Pharmaceuticals, Inc. (OTC),
Thrift Management, Inc. (OTC) and CCA Companies Incorporated (OTC). He serves
as Chairman of the Board of Noise Cancellation Technologies, Inc., and
Extech, Inc. He is currently of counsel to the law firm of Parker Duryee
Rosoff & Haft, in New York. He was previously a senior corporate partner of
such firm (1989-1994), and prior to that a founding partner of the law firm
of Wofsey, Certilman, Haft et al. (1966-1988). He is a member of the Florida
Commission for Government Accountability to the People and Treasurer of the
Miami Ballet. He is a graduate of Yale College and Yale Law School.
RICHARD HUBBARD has been a Director of the Company since October, 1997.
Mr. Hubbard is currently an analyst with the VMR High Octane Fund at Value
Management & Research GmbH. The High Octane Fund invests in small to mid-cap
companies worldwide. Since 1991, Mr. Hubbard has been a founding member of
Namco, an African marine diamond
8
<PAGE>
mining and exploration company. He was a director at Acomex Ltd. where he was
involved in the launch of Video Plus (a video coding and recording system) in
the UK market. Mr. Hubbard was a founding partner in Connolly and Hubbard
Trading, a trading company specializing in foreign exchange and commodities.
DOUG MCBURNIE has been a Director of the Company since July, 1997. He
currently serves as senior vice president, Computer, Consumer & Network
Products Group, of VLSI Technology. Mr. McBurnie is responsible for VLSI's
businesses in Advanced Computing, ASIC's, Consumer Digital Entertainment, and
Local/Wide Area Networking & Network. Prior to joining VLSI, Mr. McBurnie was
with National Semiconductor, where he was senior vice president and general
manager of the Communications and Consumer Group. Previously, he was vice
president and general manager of National's Local Area Network Division.
Under Mr. McBurnie's leadership, National became the recognized leader in
networking circuits, one of the top telecom IC suppliers, and made a strong
push into consumer entertainment markets. Prior to joining National, Mr.
McBurnie held executive positions at a number of Silicon Valley companies,
including Xidex Corporation, Precision Monolithics and Fairchild
Semiconductor. He holds a bachelor of arts degree in business administration
from Baldwin Wallace College in Berea, Ohio.
TED D. MORGAN has been a Director of the Company since April, 1996. He
is Founder and Managing Partner of Alternative Technologies International
("ATI"), Santa Rosa, California. ATI is an international financial advisory
firm specializing in services for emerging growth companies with unique
proprietary technologies. Currently, Mr. Morgan is also CEO of entrenet
Group, a corporate advising firm. Prior to founding ATI, he founded several
companies including the Office Club which merged with Office Depot in 1990.
Mr. Morgan holds a B.S. degree in Business Administration and Production
Management from California State University.
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended February 28, 1998, there were four (4)
meetings of the Company's Board of Directors. Each Board member attended 90%
or more of the meetings of the Board of Directors and of all Committees of
the Board of Directors on which he served.
The Compensation Committee was established on March 28, 1995. The
members of the Compensation Committee are Dr. John H. Abeles, Jay M. Haft,
and Richard Hubbard, none of whom is an employee of the Company. The
Compensation Committee makes recommendations with respect to compensation of
senior officers and granting of stock options and stock awards. The
Compensation Committee met on July 15, 1998.
The members of the Audit Committee are Jay Haft and Ted Morgan. The
Audit Committee recommends engagement of the Company's independent auditors
and is primarily responsible for approving the services performed by the
Company's independent auditors and for reviewing and evaluating the Company's
accounting policies and its system of internal accounting controls. The Audit
Committee met on September 22, 1997.
9
<PAGE>
There is no Nominating Committee of the Board of Directors.
REMUNERATION OF NON-EMPLOYEE DIRECTORS
Each member of the Board of Directors who is not an employee of the
Company is compensated for his services as a Director as follows: $750.00 for
each Board Meeting attended in person, and $250.00 for each Board Meeting
attended by telephone.
At the Company's 1995 Annual Stockholders' Meeting, the Company's
stockholders approved the establishment of the 1995 Directors Non-Qualified
Stock Option Plan (the "1995 Directors Plan") providing for grants to the
Company's non-employee Directors ("Outside Directors") in order to attract
and retain Outside Directors who possess a high degree of competence,
experience, leadership and motivation. A total of 225,000 shares of Common
Stock are reserved for issuance to the Company's Outside Directors upon
exercise of non-qualified options under the 1995 Directors Plan.
At the Company's 1996 Annual Stockholders' Meeting, the Company's
stockholders approved the establishment of the 1996 Directors Non-Qualified
Stock Option Plan (the "1996 Directors Plan") providing for grants to Outside
Directors. A total of 120,000 shares of Common Stock are reserved for
issuance to the Company's Outside Directors upon exercise of non-qualified
options with the 1996 Directors Plan.
The 1995 Directors Plan and the 1996 Directors Plan are administered by
the Compensation Committee of the Company's Board of Directors, which will at
all times consist solely of Outside Directors.
The following non-employee Directors were granted options to purchase
the Company's Common Stock during the fiscal year ended February 28, 1998:
<TABLE>
<CAPTION>
Name Number of shares Weighted Average Exercise Price
- --------------- ---------------- -------------------------------
<S> <C> <C>
Richard Hubbard 45,000 (1) $ 1.38
Doug McBurnie 45,000 (2) $ 1.38
</TABLE>
- -----------
(1) Option for 15,000 shares granted under the 1995 Directors Plan and
option for 30,000 shares granted under the 1996 Directors Plan.
(2) Option for 45,000 shares granted under the 1995 Directors Plan.
10
<PAGE>
PROPOSAL 2:
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected PricewaterhouseCoopers LLP as the
Company's independent auditors for the fiscal year ending February 28, 1999
and has further directed that management submit the selection of auditors for
ratification by the stockholders at the Annual Meeting. A predecessor of
PricewaterhouseCoopers LLP was first appointed independent auditors of the
Company in August, 1993. Representatives of PricewaterhouseCoopers LLP are
expected to be present at the Annual Meeting, will have an opportunity to
make a statement if they so desire, and will be available to respond to
appropriate questions.
Stockholder ratification of the selection of PricewaterhouseCoopers LLP
as the Company's independent auditors is not required by the Company's Bylaws
or otherwise. However, the Board is submitting the selection of
PricewaterhouseCoopers LLP to the stockholders for ratification as a matter
of good corporate practice. If the stockholders fail to ratify the selection,
the Board will reconsider whether to retain that firm. Even if the selection
is ratified, the Board in its discretion may direct the appointment of a
different independent accounting firm at any time during the year if the
Board determines that such a change would be in the best interests of the
Company and its stockholders.
MANAGEMENT RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 2.
PROPOSAL 3:
APPROVE AMENDMENT OF THE COMPANY'S 1993 INCENTIVE AND
NON-QUALIFIED STOCK OPTION PLAN INCREASING THE
NUMBER OF SHARES AUTHORIZED TO BE ISSUED UNDER THE
PLAN TO 3,625,000 FROM 2,625,000 SHARES
In March 1993, in order to attract and retain personnel who possess a
high degree of competence, experience and motivation, the Company's Board of
Directors adopted and the stockholders of the Company approved the Company's
1993 Incentive and Nonqualified Stock Option Plan, as amended (the "Stock
Option Plan"). At present, the Stock Option Plan, as approved by the Board of
Directors of the Company, authorizes the Company to grant both incentive and
nonqualified stock options to purchase 2,625,000 shares of the Company's
Common Stock. On August 27, 1998, the Board of Directors approved an increase
to 3,625,000 of the number of shares authorized to be issued under the Stock
Option Plan, and the Company is seeking ratification and authorization from
the stockholders for such increase. The Company has at the present time
2,236,152 options outstanding or exercised under the Stock Option Plan.
Accordingly, in order to continue to issue stock options and other forms of
stock-based incentive compensation under the Stock Option Plan, the Board has
deemed it advisable to amend the Stock Option Plan to increase the number of
shares authorized to be issued under the Stock Option Plan to 3,625,000 from
2,625,000 shares. In the opinion of the Board, the authorization
11
<PAGE>
to issue additional shares would provide the necessary flexibility to
motivate and reward the employees of the Company in a manner that would
improve the Company's financial performance. The affirmative vote of the
holders of a majority of the shares voting at the Annual Meeting is necessary
to approve the amendment to the Stock Option Plan.
MANAGEMENT RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 3.
DESCRIPTION OF THE INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN
On March 3, 1993, the Company adopted its Incentive and Nonqualified
Stock Option Plan under which, as subsequently amended and approved by the
stockholders, 2,625,000 shares of Common Stock have been reserved for
issuance to officers, directors, employees and consultants of the Company
upon exercise of options either designated as "incentive stock options"
within the meaning of Section 422 of the Internal Revenue Code of 1986 or
upon exercise of nonstatutory options. The primary purpose of the Stock
Option Plan is to attract and retain capable executives, employees,
directors, advisory board members and other consultants by offering such
individuals a greater personal interest in the Company's business by
encouraging stock ownership. The Stock Option Plan is administered by the
Compensation Committee consisting of outside members of the Board of
Directors which determines, among other things, the persons to be granted
options, the number of shares subject to each option and the option price.
The Stock Option Plan terminates on March 3, 2003.
The exercise price of any incentive stock option granted under the Stock
Option Plan to an eligible employee must be equal to the fair market value of
the shares on the date of grant, and with respect to persons owning more than
10% of the outstanding Common Stock, the exercise price may not be less than
110% of the fair market value of the shares underlying such option on the
date of grant. The Compensation Committee will determine the term of each
option and the manner in which it may be exercised provided that no incentive
stock option may be exercisable more than ten years after the date of grant,
except for optionees who own more than 10% of the Company's Common Stock, in
which case the option may not be for more than five years. Further, no
director of the Company or other person who is not an employee of the Company
will be eligible to receive incentive stock options. From the date of grant
until three months prior to the exercise, the optionee must be an employee of
the Company in order to exercise any options, except in the case of
disability or death of the employee. Options are not transferable except upon
the death of the optionee. In the event of disability, options must be
exercised within twelve months of termination of employment as determined by
the Compensation Committee. Nonqualified options will have similar terms
except the exercise price therefor may not be less than 85% of the fair
market value of the shares underlying such options, and the term of such
nonqualified options may not extend beyond ten years and one week. The
Compensation Committee has the power to impose additional limitations,
conditions and restrictions in connection with the grant of any option.
12
<PAGE>
The Company has issued outstanding options to purchase an aggregate of
2,236,152 shares of Common Stock of the Company pursuant to the Stock Option
Plan to the following present or former officers and key employees of the
Company (as well as other employees of the Company) at the weighted average
exercise prices described below as of August 31, 1998:
<TABLE>
<CAPTION>
Name Number Of Shares Weighted Average Exercise Price
- ------------------ ---------------- -------------------------------
<S> <C> <C>
Philip J. Micciche 520,000 $1.580
Mitchel Underseth 409,000 $1.705
Andrew Intrater 385,625 $1.666
Arvind Patel 341,569 $1.845
James Intrater 152,250 $1.484
Karen P. Shrier 84,000 $1.072
</TABLE>
Under the terms of the grant, the options will vest in various increments
over various periods following the date of grant. In addition, in the event
of an optionee's disability, all options granted will immediately vest, and
in the event of an optionee's death, all options will similarly vest but
expire one year thereafter In the event the optionee voluntarily terminates
his or her employment or should such employment be terminated by the Company,
options that are vested through the date of termination may be exercised for
a period of three months following the date of termination.
PROPOSAL 4
APPROVE AMENDMENT OF THE COMPANY'S 1996 DIRECTORS NON-QUALIFIED
STOCK OPTION PLAN INCREASING THE NUMBER OF SHARES AUTHORIZED TO BE
ISSUED UNDER THE PLAN TO 250,000 FROM 120,000.
At the Company's 1996 Annual Stockholders' Meeting, the Company's
stockholders approved the establishment of the 1996 Directors Non-Qualified
Stock Option Plan (the "1996 Directors Plan") providing for grants to the
Company's non-employee Directors ("Outside Directors") in order to attract
and retain Outside Directors who possess a high degree of competence,
experience, leadership and motivation. A total of 120,000 shares of Common
Stock were reserved for issuance to the Company's Outside Directors upon
exercise of non-qualified options. The 1996 Directors Plan is administered by
the Compensation Committee of the Company's Board of Directors, which will at
all times consist solely of Outside Directors. On August 27, 1998, the Board
of Directors approved an increase to 250,000 of the number of shares
authorized to be issued under the 1996 Directors Plan, and the Company is
seeking ratification and authorization from the stockholders for such
increase.
Each Outside Director who joins the Company's Board of Directors
subsequent to the approval of the 1996 Directors Plan will initially receive
options to purchase 30,000 shares of the Company's Common Stock, effective as
of the date he or she is appointed or elected to the Company's Board of
Directors. In October 1997, outside director, Mr. Hubbard, was granted
13
<PAGE>
options to purchase 30,000 shares of the Company's Common Stock. The Company
has at the present time 90,000 options outstanding or exercised under the
1996 Directors Plan. Accordingly, in order to continue to issue stock options
the 1996 Directors Plan, the Compensation Committee and the Board have deemed
it advisable to amend the 1996 Directors Plan to increase the number of
shares authorized to be issued under such plan to 250,000 from 120,000
shares. In the opinion of the Board, the authorization to issue additional
shares would provide the necessary flexibility to motivate and reward Outside
Directors in a manner that would improve the Company's financial performance.
The affirmative vote of the holders of a majority of the shares voting at the
Annual Meeting is necessary to approve the amendment to the 1996 Directors
Plan.
MANAGEMENT RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 4.
DESCRIPTION OF THE 1996 DIRECTORS NON-QUALIFIED STOCK OPTION PLAN
All options granted under the 1996 Directors Plan will vest in three
equal annual installments commencing with the date of grant, provided that
the Outside Director continues to serve on the Company's Board of Directors.
The exercise price of the options granted under the 1996 Directors Plan will
be equal to the fair market value of the Company's Common Stock on the date
of grant. The options are not transferable except upon the death of the
optionee. In the event of an optionee's disability, all options granted will
immediately vest, and in the event of an optionee's death, all options will
similarly vest but expire one year thereafter. In the event the optionee
voluntarily resigns from the Board of Directors or ceases to serve as a Board
Member, options that are vested through the date of such resignation or
cessation may be exercised for a period of three months thereafter. The 1996
Directors Plan provides that it may not be amended more than once every six
months, other than to comport with changes in the Internal Revenue Code of
1986, as amended, the Employee Retirement Income Security Act, or the rules
thereunder. The Compensation Committee has the power to impose additional
limitations, conditions and restrictions in connection with the grant of any
option.
The Company has issued options to purchase an aggregate of 90,000 shares
of Common Stock of the Company pursuant to the 1996 Directors Plan at the
weighted average exercise price described below as of August 31,1998:
<TABLE>
<CAPTION>
Name Number Of Shares Weighted Average Exercise Price
- ------------------- ---------------- -------------------------------
<S> <C> <C>
Philip J. Micciche -0- -
Mitchel Underseth -0- -
Andrew Intrater -0- -
Dr. John H. Abeles 30,000 $1.97
Jay M. Haft 30,000 $1.97
Richard Hubbard 30,000 $1.375
Doug McBurnie -0- -
Ted D. Morgan -0- -
</TABLE>
14
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding the beneficial
ownership of the Company's Common Stock as of August 31, 1998 (i) by each
person who is known to the Company to be the owner of more than five percent
(5%) of the Company's Common Stock, (ii) by each of the Company's Directors,
(iii) by each of the Company's executive officers, and (iv) by all Directors
and executive officers of the Company as a group. As of August 31, 1998,
there were issued and outstanding 13,124,821 shares of Common Stock of the
Company.
<TABLE>
<CAPTION>
Number of
Shares of
Common Stock Percent of
Name and Address Beneficially Beneficial
or Identity of Group Owned Ownership
- -------------------- ------------ -----------
<S> <C> <C>
Philip Micciche (1) 130,667 1.0%
1100 Auburn Street
Fremont, CA 94538
Mitchel Underseth (2) 92,500 *
1100 Auburn Street
Fremont, CA 94538
Andrew Intrater (3) 361,396 2.8%
1100 Auburn Street
Fremont, CA 94538
Dr. John Abeles (4) 549,672 4.2%
2365 Northwest 41st Street
Boca Raton, FL 33431
Jay M. Haft (5) 154,300 1.2%
2 Grove Isle Dr., #1208B
Coconut Grove, FL 33122
Richard Hubbard (6) 15,000 *
130, The Minories
London EC3N1NT
United Kingdom
Doug McBurnie (7) 15,000 *
1109 McKay Drive, MS24
San Jose, CA 95131
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
Number of
Shares of
Common Stock Percent of
Name and Address Beneficially Beneficial
or Identity of Group Owned Ownership
- -------------------- ------------ ----------
<S> <C> <C>
Ted D. Morgan (8) 29,700 *
1304 S. Point Blvd., Ste. 220
Petaluma, CA 94954
Windstar Investments N.V. (9) 1,163,947 8.9%
200 East Broward Blvd.,
Suite 1900
Fort Lauderdale, FL 33302
AIB Govett Asset Mgmt. Ltd. 930,000 7.1%
Shackleton House
4 Battle Bridge Lande
London, England S31 2HR
VMR High Octane Fund 842,105 6.4%
c/o Meespierson Fund Services
18-20 North Quay
Douglas, Isle of Man 1M991M
Arvind Patel (10) 484,569 3.7%
425 Alvardo Street
San Francisco, CA 94114
All Officers and Directors
as a Group (8 persons) (11) 1,832,804 14.0%
</TABLE>
- -----------------
* Represents less than 1%.
(1) Represents shares subject to stock options exercisable as of August 31,
1998 or within 60 days thereafter.
(2) Represents shares subject to stock options exercisable as of August 31,
1998 or within 60 days thereafter.
(3) Includes 124,093 shares subject to stock options exercisable as of August
31, 1998 or within 60 days thereafter, 500 shares of Common Stock issuable
upon conversion of Warrants.
16
<PAGE>
(4) Includes 313,008 shares of Common Stock held by Northlea Partners Ltd. of
which Dr. Abeles is the General Partner, and 35,000 shares issuable upon
conversion of the Company's Series A Preferred Stock also held by Northlea
Partners. Also includes 9,375 shares of Common Stock issuable upon exercise
of certain Bridge Warrants described below. Includes 37,000 shares of
Common Stock issuable upon conversion of Warrants, held by Northlea
Partners. Also includes 58,500 shares subject to stock options exercisable
as of August 31, 1998 or within 60 days thereafter. Also includes 96,789
shares of Common Stock issuable upon exercise of Bridge Warrants.
(5) Includes 58,500 shares subject to stock options exercisable as of August
31, 1998 or within 60 days thereafter. Also includes 22,000 shares of
Common Stock issuable upon conversion of Warrants.
(6) Represents shares subject to stock options exercisable as of August 31,
1998 or within 60 days thereafter.
(7) Represents shares subject to stock options exercisable as of August 31,
1998 or within 60 days thereafter.
(8) Represents shares subject to stock options exercisable as of August 31,
1998 or within 60 days thereafter.
(9) Includes 497,280 shares of Common Stock issuable upon conversion of
Warrants.
(10) Represents 341,569 shares subject to stock options exercisable as of August
31, 1998 or within 60 days thereafter, and 35,000 shares held as a
custodian for Mr. Patel's minor children. Also includes 16,096 shares of
Common Stock issuable upon conversion of Bridge Warrants.
(11) Includes an aggregate of 1,081,789 shares issuable upon exercise of
warrants and stock options and conversion of Preferred Stock.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than ten percent (10%) of a
registered class of the Company's equity securities, to file with the
Commission initial reports of ownership and reports of changes in ownership
of Common Stock and other equity securities of the Company. Officers,
directors and greater than ten percent (10%) stockholders are required by
Commission regulation to furnish the Company with copies of all Section 16(a)
forms they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no
other reports were required, during the fiscal year ended February 28, 1998,
all Section 16(a) filing requirements applicable to its
17
<PAGE>
officers, directors and greater than ten percent (10%) beneficial owners were
complied with in a timely manner.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company was incorporated in Delaware on July 26, 1993, and on
September 29, 1993 executed a Plan and Agreement of Merger with Advanced
Technology, Inc. ("ATI"), a New Jersey corporation and the Company's parent
corporation and predecessor. ATI was organized on April 2, 1976 under the
laws of the State of New Jersey. In connection with this merger, the Company
exchanged with the stockholders of ATI an equal number of shares for the
outstanding shares of capital stock of ATI outstanding at the time of the
merger. The nominal number of shares of the Company outstanding at the time
of the merger were canceled as part of the Plan and Agreement of Merger. In
addition, the Company exchanged 45,000 shares of its Series A Preferred Stock
for the 45,000 shares of Series A Preferred Stock that were outstanding of
the predecessor corporation and which had the same designations and
preferences that had been established for the Series A Preferred Stock of the
predecessor corporation.
In May 1993, ATI issued an aggregate of $375,000 principal amount of its
secured promissory notes at an interest rate equal to the published prime
rate of The Wall Street Journal, but not to exceed 9% per annum, and 45,000
shares of its Series A $25 2% Convertible Cumulative Preferred Stock
convertible into 525,000 shares of Common Stock of the Company. The notes
were retired from the proceeds of the Company's public offering completed in
April 1994. Northlea Partners, Ltd. of which Dr. John Abeles is the General
Partner, acquired $25,000 principal amount of such promissory notes and 3,000
shares of Series A Preferred Stock.
In May 1995, the Company completed a private placement consisting of
2,536,290 shares of Common Stock pursuant to which the Company received
proceeds of approximately $1,900,000. Northlea Partners acquired for a
consideration of $150,000, 200,000 shares of this private placement. Mr.
Nitin T. Mehta, a former Director of the Company, acquired for himself and
through his retirement account set up by Mehta & Co., Inc., 573,334 shares of
Common Stock for a consideration of $430,000 principal amount. Mrs. Judith A.
Schindler, wife of Bruce L. Schindler, a former Director of the Company,
acquired for a consideration of $50,000, 66,667 common shares of this private
placement. Jay M. Haft, a Director of the Company, acquired 89,600 shares of
Common Stock for $67,200 consideration. Andrew Wilson, the Company's former
Chief Financial Officer, acquired 10,000 shares for $7,500 consideration.
Arvind Patel, the Company's former Chief Executive Officer and a Director,
acquired for himself and his two children a total of 40,000 shares for a
consideration of $30,000.
In February 1996, the Company issued warrants ("Bridge Warrants") to
purchase 332,551 shares of Common Stock at a per share price of $1.25 in
connection with a bridge loan made to the Company which was subsequently
repaid. Northlea Partners received Bridge Warrants to purchase 96,789 shares
of Common Stock relating to this bridge loan. Another Director, Mr. Nitin
Mehta, received Bridge Warrants to purchase 117,049 shares of Common Stock
relating to this bridge loan. Arvind Patel, then a Director and President and
CEO of the Company, received Bridge Warrants to purchase 16,096 shares of
Common Stock relating to this bridge loan.
18
<PAGE>
In August 1997, the Company sold to qualified private investors
2,000,000 shares of its Series A Preferred Stock holdings in DAS Devices for
$1,400,000. Of the 2,000,000 shares sold, approximately 19%, or 378,572
shares, were purchased by certain Directors and key employees of the Company
under the same terms and conditions as the other third party private
purchasers. Of the 378,572 shares purchased, 142,857 shares were purchased by
Arvind Patel, then President and Chief Executive Officer of the Company.
EXECUTIVE COMPENSATION
CASH COMPENSATION
The following table sets forth the total compensation earned by the
Chief Executive Officer and the Company's other executive officers whose
total salary and compensation exceeded $100,000 for services rendered in all
capacities for the year ended February 28, 1998 and for the years ended
February 28, 1997 and February 29, 1996.
<TABLE>
<CAPTION>
Name and Fiscal Other Annual
Principal Position Year Salary Bonus Compensation
- ------------------ ------ -------- ----- ------------
<S> <C> <C> <C> <C>
Philip Micciche, 1998 $127,308 $ -- $ 4,000
President & CEO
Mitchel Underseth 1998 $137,558 $44,053* $ 3,600
CFO 1997 $ 31,900 $25,000** $ 1,200
Andrew Intrater, 1998 $135,000 $ -- $ 8,578***
Secretary/Treasurer 1997 $125,583 $ -- $ 8,578***
1996 $103,063 $ -- $ 8,578***
Arvind Patel, 1998 $ 25,519 $ -- $153,081****
President & CEO 1997 $168,866 $ -- $ 3,600
1996 $140,996 $ -- $ 3,600
</TABLE>
- ------------------
* Mr. Underseth received a $44,053 performance bonus in March 1998
attributable to fiscal year 1998.
** Pursuant to Mr. Underseth's agreement to join Oryx, a $25,000 signing
bonus was paid to Mr. Underseth subject to a minimum employment of one year.
19
<PAGE>
*** Other compensation in relation to Mr. Intrater consists of premiums paid
on behalf of Mr. Intrater for term life insurance in the face amount of
$1,000,000 which is payable to Mr. Intrater's beneficiary upon his death,
less the amount of the premiums theretofore paid on his behalf which are
remitted to the Company.
**** Mr. Patel ceased being President and CEO of the Company on April 25,
1997. He remained a Director through the Company's Annual Meeting in October
1997. Reflects $149,481 of severance payments pursuant to terms and
conditions of the separation agreement with Mr. Patel executed in June 1997.
The following table sets forth as to the Chief Executive Officer and
each of the executive officers named under the Summary Compensation Table,
certain information with respect to grants of options to purchase shares of
Common Stock of the Company as of and for the year ended February 28, 1998.
<TABLE>
<CAPTION>
OPTION/SAR GRANTS
Year Ended February 28, 1998
Number of
Securities % of Total
Underlying Options/SARs Exercise
Option/SARs Granted to or Base
Granted Employees in Price ($ Exp.
Number (#) 1998 per share) Date
----------- ------------ ---------- -------
<S> <C> <C> <C> <C>
Philip Micciche 200,000 14% $1.38 4/29/02
320,000 23% $1.58 9/23/01
Mitchel Underseth 30,000 2% $1.26 6/26/01
290,000 21% $1.58 9/23/01
Andrew Intrater 290,000 21% $1.58 9/23/01
Arvind Patel 100,000 7% $1.94 4/29/02
</TABLE>
- -------------------------------
EMPLOYMENT AGREEMENTS
The Company entered into an employment agreement dated as of April 25,
1997 with Mr. Philip Micciche, terminable immediately by either party,
providing for annual compensation of $150,000 during the term of the
agreement and increases in salary based upon the Compensation Committee's
recommendation. In the event Mr. Micciche is terminated without cause by the
Company, he will receive his annual compensation for six months.
The Company entered into an employment agreement dated as of November 1,
1996 with Mr. Mitchel Underseth, terminable immediately by either party,
providing for annual compensation of $120,000, and with increases in salary
based upon the Compensation Committee's
20
<PAGE>
recommendation. In the event Mr. Underseth is terminated without cause by the
Company, he will receive his annual compensation for six months.
The Company entered into an employment agreement dated as of May 3, 1993
with Mr. Andrew Intrater, terminable immediately by either party, providing
for annual compensation of $100,000 during the term of the agreement and
increases in salary based upon the Compensation Committee's recommendation.
In the event Mr. Intrater is terminated without cause by the Company, he will
receive his annual compensation for six months. Mr. Intrater has also entered
into a non-competition agreement with the Company which precludes his
engagement in competitive activities during the term of his employment,
precludes him from soliciting customers and employees of the Company for a
period of twelve months following termination of his employment, and also
requires Mr. Intrater to maintain the confidentiality of information and
proprietary data relating to the Company and its activities. On February 27,
1998, this employment agreement terminated as Mr. Intrater resigned from the
Company's employment following the sale of the Company's majority ownership
interest in Oryx Instruments & Materials Corporation, since renamed as Oryx
Instruments Corporation. Mr. Intrater continues to serve as Director,
Secretary and Treasurer of the Company.
The Company entered into an employment agreement with Arvind Patel on
April 15, 1993, providing for annual compensation of $137,000 during the term
of the agreement. Mr. Patel's employment with the Company was terminated on
April 25, 1997. On June 6, 1997, Mr. Patel entered into a separation
agreement with the Company. Under the terms of the separation agreement Mr.
Patel received twelve months of severance through April 24, 1998 equivalent
to his monthly salary as of April 24, 1997. In 1993, Mr. Patel also entered
into a non-competition agreement with the Company which precludes him from
soliciting customers and employees of the Company for a period of twelve
months following termination of his employment, and also requires Mr. Patel
to maintain the confidentiality of information and proprietary data relating
to the Company and its activities.
The Company currently offers basic health and major medical insurance to
its employees. The Company has adopted a non-contributory 401(k) Plan for its
employees who wish to participate on a voluntary basis, but no retirement,
pension or similar program has been adopted by the Company.
OTHER MATTERS
EXPENSES OF SOLICITATION
The accompanying proxy is solicited by and on behalf of the Board of
Directors of the Company, and the entire cost of such solicitation will be
borne by the Company. In addition to the use of the mails, proxies may be
solicited by directors, officers and employees of the Company, by personal
interview, telephone and facsimile. Arrangements will be made with brokerage
houses and other custodians, nominees and fiduciaries for the forwarding of
solicitation material and annual reports to the beneficial owners of stock
held of record by such
21
<PAGE>
persons, and the Company will reimburse them for reasonable out-of-pocket and
clerical expenses incurred by them in connection therewith.
FINANCIAL AND OTHER INFORMATION
All financial information is incorporated by reference to the
information contained in the Financial Statements included in the Company's
Annual Report to security holders. COPIES OF THE COMPANY'S COMPLETE ANNUAL
REPORT AND FORM 10-KSB ARE AVAILABLE WITHOUT CHARGE UPON REQUEST MADE TO THE
COMPANY'S CORPORATE OFFICES.
STOCKHOLDER PROPOSALS
Proposals of stockholders that are intended to be presented at the
Company's 1999 Annual Meeting of Stockholders must be received by the Company
no later than May 16, 1999, in order to be included in the proxy statement
and proxy relating to the 1999 Annual Meeting.
DISCRETIONARY AUTHORITY
The Annual Meeting is called for the specific purposes set forth in the
Notice of Annual Meeting as discussed above, and also for the purpose of
transacting such other business as may properly come before the Annual
Meeting. At the date of this Proxy Statement the only matters which
management intends to present, or is informed or expects that others will
present for action at the Annual Meeting, are those matters specifically
referred to in such Notice. As to any matters which may come before the
Annual Meeting other than those specified above, the proxy holder will be
entitled to exercise discretionary authority.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Andrew Intrater
----------------------------------
Andrew Intrater, Secretary
Dated: September 17, 1998
Fremont, California
22
<PAGE>
APPENDIX A
ORYX TECHNOLOGY CORP.
1100 Auburn Street
Fremont, CA 94538
PROXY
The undersigned hereby constitutes and appoints Philip J. Micciche as Proxy,
with the power to appoint his substitute, and hereby authorizes him to
represent and to vote as designated below, all shares of common stock of the
Company held of record by the undersigned on September 10, 1998, at the
Annual Meeting of Stockholders to be held on October 26, 1998, or any
adjournment thereof.
1. Election of Directors WITHHOLD AUTHORITY to vote
FOR all nominees listed below for all such nominees listed
(except as marked to the below
contrary)
/ / / /
Philip J. Micciche
Mitchel Underseth
Andrew Intrater
John H. Abeles
Jay M. Haft
Richard Hubbard
Doug McBurnie
Ted D. Morgan
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE PLEASE DRAW A LINE THROUGH THAT NOMINEE'S NAME)
2. To ratify the appointment of PricewaterhouseCoopers LLP as auditors of the
Company's financial statements for the fiscal year ending February 28,
1999;
/ / FOR / / AGAINST / / ABSTAIN
3. To approve an increase from 2,625,000 to 3,625,000 in the number of shares
which may be granted under the Company's 1993 Incentive and Nonqualified
Stock Option Plan;
/ / FOR / / AGAINST / / ABSTAIN
4. To approve an increase from 120,000 to 250,000 in the number of shares
which may be granted under the Company's 1996 Directors Non-Qualified Stock
Option Plan;
/ / FOR / / AGAINST / / ABSTAIN
1
<PAGE>
5. In his discretion, the Proxy is authorized to vote upon such other business
as may properly come before the meeting or any adjournment thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF ORYX
TECHNOLOGY CORP. THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR THE NOMINEES LISTED IN PROPOSAL 1 AND FOR
PROPOSALS 2, 3 AND 4.
The undersigned stockholder hereby acknowledges receipt of the Notice of
Annual Meeting and Proxy Statement and hereby revokes any proxy or proxies
heretofore given. This proxy may be revoked at any time prior to the Annual
Meeting. If you received more than one proxy card, please date, sign and
return all cards in the accompanying envelope.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in the corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
-----------------------------
Signature
-----------------------------
Signature If Held Jointly
-----------------------------
(Please Print Name)
-----------------------------
Number of Shares Subject to Proxy
Dated: _______________, 1998
2
<PAGE>
APPENDIX B
ORYX TECHNOLOGY CORP.
INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN
(As amended August 27, 1998)
1. PURPOSE. The purpose of the ORYX Technology Corp. INCENTIVE AND
NONQUALIFIED STOCK OPTION PLAN (the "Plan") is to grant to selected employees
of ORYX Technology Corp., a Delaware corporation (the "Company") and its
subsidiaries and affiliates, a favorable opportunity to acquire Common Stock
of the Company, thereby encouraging such persons to accept or continue their
relationships with the Company; increasing the interest of such persons in
the Company's welfare through participation in the growth and value of the
Common Stock; and furnishing such persons with an incentive to improve
operations and increase profits of the Company.
To accomplish the foregoing objectives, this Plan provides a means
whereby employees may receive options to purchase Common Stock. Options
granted under this Plan will be either nonstatutory (nonqualified) stock
options or incentive stock options.
2. ADMINISTRATION. The Plan shall be administered by the Board of
Directors of the Company, or, in the discretion of the Board, by a committee
(the Board and the Committee shall be jointly referred to hereafter as the
"Administrator") of not less than two members of the Board each of whom shall
not at any time within one (1) year prior to his service as an administrator
of the Plan have received a grant or award of equity securities pursuant to
the Plan or any other plan of the Company or any of its affiliates. Subject
to the provisions of the Plan, the Administrator shall have the sole
authority, in its discretion:
(a) to determine to which of the eligible individuals, and the time
or times at which, options to purchase Common Stock of the Company shall be
granted;
(b) to determine the number of shares of Common Stock to be subject
to options granted to each eligible individual;
(c) to determine the price to be paid for the shares of Common
Stock upon the exercise of each option;
(d) to determine the term and the exercise schedule of each option;
(e) to determine the terms and conditions of each stock option
agreement (which need not be identical) entered into between the Company and
any eligible individual to whom the Administrator has granted an option;
(f) to interpret the Plan;
1
<PAGE>
(g) to modify or amend any such option; and
(h) to make all determinations deemed necessary or advisable for
the administration of the Plan.
3. ELIGIBILITY. Every individual who at the date of grant is an employee
of the Company or of any parent or subsidiary of the Company (as defined in
subsection 5.1(c) below) is eligible to receive incentive stock options
and/or nonstatutory stock options under this Plan. The term "employee"
includes an officer or director who is an employee of the Company or a parent
or subsidiary of it, as well as a non-officer, non-director employee of the
Company or a parent or subsidiary of it. Every individual who at the date of
grant is a consultant to or non-employee director of the Company or a parent
or subsidiary of it is eligible to receive nonstatutory stock options under
this Plan.
4. COMMON STOCK SUBJECT TO PLAN.
(a) There shall be reserved for issue upon the exercise of options
granted under the Plan Three Million Six Hundred Twenty Five Thousand
(3,625,000) shares of Common Stock, subject to adjustment as provided in
Section 7 hereof. If an option granted under the Plan shall expire or
terminate for any reason without having been exercised in full, the
unpurchased shares subject thereto shall again be available for the purposes
of the Plan.
(b) Notwithstanding any other provisions of this Plan, the
aggregate number of shares of Common Stock subject to outstanding options
granted under this Plan, plus the aggregate number of shares issued upon the
exercise of all options granted under this Plan, shall never be permitted to
exceed the number of shares specified in the first sentence of subsection
4(a) above.
5. TERMS OF OPTIONS. Each option granted under the Plan shall be
evidenced by a stock option agreement between the individual to whom the
option is granted (the "optionee") and the Company. Each such agreement shall
designate the option thereby granted as an incentive stock option, a
nonstatutory stock option or in part an incentive stock option and in part a
nonstatutory stock option. Each such agreement shall be subject to the terms
and conditions set forth in subsection 5.1, and to such other terms and
conditions not inconsistent herewith as the Administrator may deem
appropriate in each case. Incentive stock options shall be subject also to
the terms and conditions set forth in subsection 5.2.
5.1 TERMS AND CONDITIONS TO WHICH ALL OPTIONS ARE SUBJECT. All
options granted under this Plan shall be subject to the following terms and
conditions:
(a) TERM OF OPTIONS. The period or periods within which an
option may be exercised shall be determined by the Administrator at the time
the option is granted, but in no event shall such period extend beyond ten
(10) years from the date the option is granted in the case of an incentive
stock option, or ten (10) years and one (1) week from the date the option is
granted in the case of a nonstatutory stock option.
2
<PAGE>
(b) EXERCISE PRICE. The price to be paid for each share of
Common Stock upon the exercise of an option shall be determined by the
Administrator at the time the option is granted, but shall in no event be
less than eighty-five percent (85%) in the case of a nonstatutory stock
option, and one hundred percent (100%) in the case of an incentive stock
option, of the fair market value of a share of Common Stock on the date the
option is granted. For all purposes of this Plan, the fair market value of
the Common Stock on any particular date shall be the closing price on the
trading day next preceding that date on the principal securities exchange on
which the Company's Common Stock is listed, or, if such Common Stock is not
then listed on any securities exchange, then the fair market value of the
Common Stock on such date shall be the mean of the closing bid and asked
prices as reported by the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ") on the trading day next preceding such
date. In the event that the Company's Common Stock is neither listed on a
securities exchange nor quoted by NASDAQ, then the Administrator shall
determine the fair market value of the Company's Common Stock on such date.
(c) MORE THAN TEN PERCENT SHAREHOLDERS. No option shall be
granted to any individual who, at the time such option would be granted, owns
stock possessing more than ten percent (10%) of the total combined voting
power of all classes of outstanding capital stock of the Company, or of any
parent corporation or subsidiary corporation of the Company, unless the
exercise price (as provided in subsection 5.1(b) hereof) is not less than one
hundred ten percent (110%) of the fair market value of the Common Stock on
the date the option is granted, and in the case of an incentive stock option
the period within which the option may be exercised (as provided in
subsection 5.1(a) hereof) does not exceed five (5) years from the date the
option is granted. As used in this Plan, the terms "parent corporation" and
"subsidiary corporation" shall have the meanings set forth in Sections 424(e)
and (f), respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). For purposes of this subsection 5.1(c), in determining stock
ownership, an optionee shall be considered as owning the voting capital stock
owned, directly or indirectly, by or for his brothers and sisters, spouse,
ancestors and lineal descendants. Voting capital stock owned, directly or
indirectly, by or for a corporation, partnership, estate or trust shall be
considered as being owned proportionately by or for its shareholders,
partners or beneficiaries, as applicable. Common Stock with respect to which
any such optionee holds an option shall not be counted. Additionally, for
purposes of this subsection 5.1(c), outstanding capital stock shall include
all capital stock actually issued and outstanding immediately after the grant
of the option to the optionee. Outstanding capital stock shall not include
capital stock authorized for issue under outstanding options held by the
optionee or by any other person.
(d) METHOD OF PAYMENT FOR COMMON STOCK. Payment for stock
purchased upon any exercise of an option granted under this Plan shall be
made in full in cash concurrently with such exercise, except that, if and to
the extent the instrument evidencing the option so provides and if the
Company is not then prohibited from purchasing or acquiring shares of such
stock, such payment may be made in whole or in part with shares of the same
class of stock as that then subject to the option, delivered in lieu of cash
concurrently with such exercise, the shares so delivered to be valued on the
basis of the fair market value of the stock (determined
3
<PAGE>
in a manner specified in the instrument evidencing the option) on the day
preceding the date of exercise.
(e) NONTRANSFERABILITY. All options shall be nontransferable,
except by will or the laws of descent and distribution, and shall be
exercisable during the lifetime of the optionee only by the optionee.
(f) WITHHOLDING AND EMPLOYMENT TAXES. At the time of exercise
of an option, the optionee shall remit to the Company in cash the amount of
any and all applicable federal and state withholding and employment taxes.
5.2 ADDITIONAL TERMS AND CONDITIONS TO WHICH INCENTIVE STOCK
OPTIONS ARE SUBJECT. Options granted under this Plan which are designated as
incentive stock options shall be subject to the following additional terms
and conditions:
(a) ANNUAL LIMITATION. To the extent that the aggregate fair
market value (determined as of the date an incentive stock option is granted)
of the stock with respect to which incentive stock options granted are
exercisable for the first time by an employee during any one (1) calendar
year (under this Plan and under all other incentive stock option plans of the
Company and of any parent or subsidiary corporation) exceeds One Hundred
Thousand Dollars ($100,000), such options shall be treated as options which
are not incentive stock options.
(b) DEATH. Upon the death of an employee, any incentive stock
option which such employee holds may be exercised, within such period after
the date of death as the Administrator shall prescribe in the stock option
agreement, by the employee's representative or by the person entitled thereto
under the employee's will or the laws of intestate succession.
(c) DISABILITY. Upon the disability of an employee, any
incentive stock option which the employee holds may be exercised by the
employee within such period after the date of termination of employment
resulting from such disability (not to exceed twelve (12) months) as the
Administrator shall prescribe in the stock option agreement. The option shall
terminate upon the expiration of such prescribed period, unless the employee
dies prior thereto, in which event the provisions of subsection 5.2(b) hereof
shall apply.
(d) RETIREMENT. Upon the voluntary retirement of an employee
at or after reaching sixty-five (65) years of age, an incentive stock option
may be exercised by such employee with respect to all or any portion of the
balance of the Common Stock subject thereto within such period after the date
of retirement (not to exceed three (3) months) as the Administrator shall
prescribe in the stock option agreement. The option shall terminate upon the
expiration of such prescribed period, unless the employee dies prior thereto,
in which event the provisions of subsection 5.2(b) hereof shall apply.
(e) TRANSFER TO RELATED CORPORATION. In the event that an
employee leaves the employ of the Company to become an employee of any parent
or subsidiary corporation of the Company, or if the employee leaves the employ
of any such parent or
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subsidiary corporation to become an employee of the Company or of another
parent or subsidiary corporation, such employee shall be deemed to continue
as an employee of the Company for all purposes of this Plan.
(f) OTHER SEVERANCE. In the event an employee leaves the
employ of the Company for any reason other than as set forth in subsections
(b) through (e), above, any incentive stock option which such employee holds
may be exercised by such employee with respect to all or any portion of the
balance of the Common Stock subject thereto within such period after the date
of severance (not to exceed three (3) months) as the Administrator shall
prescribe in the stock option agreement.
(g) DISQUALIFYING DISPOSITIONS. If Common Stock acquired by
exercise of an incentive stock option granted pursuant to this Plan is
disposed of within two (2) years from the date of grant of the option or
within one (1) year after the transfer of the Common Stock to the optionee,
the holder of the Common Stock immediately prior to the disposition shall
promptly notify the Company in writing of the date and terms of the
disposition and shall provide such other information regarding the
disposition as the Company may reasonably require.
6. STOCK ISSUANCE AND RIGHTS AS SHAREHOLDER. Notwithstanding any other
provisions of the Plan, no optionee shall have any of the rights of a
shareholder (including the right to vote and receive dividends) of the
Company, by reason of the provisions of this Plan or any action taken
hereunder, until the date such optionee shall both have paid the exercise
price for the Common Stock and shall have been issued (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company) the stock certificate evidencing such shares.
7. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.
(a) Subject to any required action by the Company's shareholders,
the number of shares of Common Stock covered by this Plan as provided in
Section 4, the number of shares covered by each outstanding option granted
hereunder and the exercise price thereof shall be proportionately adjusted
for any increase or decrease in the number of issued shares of Common Stock
resulting from a subdivision or consolidation of such shares or the payment
of a stock dividend (but only on the Common Stock) or any other increase or
decrease in the number of such outstanding shares of Common Stock effected
without the receipt of consideration by the Company; provided, however, that
the conversion of any convertible securities of the Company shall not be
deemed to have been "effected without receipt of consideration."
(b) Subject to any required action by the Company's shareholders,
if the Company shall be the surviving corporation in any merger or
consolidation, each outstanding option shall pertain and apply to the
securities to which a holder of the number of shares subject to the option
would have been entitled. A dissolution or liquidation of the Company or a
merger or consolidation in which the Company is not the surviving corporation
shall cause each outstanding option to terminate, unless the surviving
corporation in the case of a merger or
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consolidation assumes outstanding options or replaces them with substitute
options having substantially similar terms and conditions.
(c) To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive.
(d) Except as hereinabove expressly provided in this Section 7, no
optionee shall have any rights by reason of any subdivision or consolidation
of shares of the capital stock of any class or the payment of any stock
dividend or any other increase or decrease in the number of shares of any
class or by reason of any dissolution, liquidation, merger or consolidation
or spin-off of assets or stock of another corporation, and any issue by the
Company of shares of stock of any class or of securities convertible into
shares of stock of any class shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares subject
to any option granted hereunder.
(e) The grant of an option pursuant to this Plan shall not affect
in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge or consolidate or to dissolve, liquidate, sell or
transfer all or any part of its business or assets.
8. SECURITIES LAW REQUIREMENTS.
(a) The Administrator may require an individual as a condition of
the grant and of the exercise of an option, to represent and establish to the
satisfaction of the Administrator that all shares of Common Stock to be
acquired upon the exercise of such option will be acquired for investment and
not for resale. The Administrator shall cause such legends to be placed on
certificates evidencing shares of Common Stock issued upon exercise of an
option as, in the opinion of the Company's counsel, may be required by
federal and applicable state securities laws.
(b) No shares of Common Stock shall be issued upon the exercise of
any option unless and until counsel for the Company determines that: (i) the
Company and the optionee have satisfied all applicable requirements under the
Securities Act of 1933 and the Securities Exchange Act of 1934; (ii) any
applicable listing requirement of any stock exchange on which the Company's
Common Stock is listed has been satisfied; and (iii) all other applicable
provisions of state and federal law have been satisfied.
9. FINANCIAL ASSISTANCE. The Company is vested with authority under this
Plan to assist any employee to whom an option is granted hereunder (including
any consultant to, director or officer of the Company or any of its
subsidiaries who is also an employee) in the payment of the purchase price
payable on exercise of that option, by lending the amount of such purchase
price to such employee on such terms and at such rates of interest and upon
such security as shall have been authorized by or under authority of the
Board.
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10. AMENDMENT. The Board may terminate the Plan or amend the Plan from
time to time in such respects as the Board may deem advisable, except that,
without the approval of the Company's shareholders in compliance with the
requirements of applicable law, no such revision or amendment shall:
(a) increase the number of shares of Common Stock reserved under
Section 4 hereof for issue under the Plan, except as provided in Section 7
hereof;
(b) change the class of persons eligible to participate in the Plan
under Section 3 hereof;
(c) extend the term of the Plan under Section 10 hereof; or
(d) amend this Section 10 to defeat its purpose.
11. TERMINATION. The Plan shall terminate automatically on March 3,
2003, and may be terminated at any earlier date by the Board. No option shall
be granted hereunder after termination of the Plan, but such termination
shall not affect the validity of any option then outstanding.
12. TIME OF GRANTING OPTIONS. The date of grant of an option hereunder
shall, for all purposes, be the date on which the Administrator makes the
determination granting such option.
13. RESERVATION OF SHARES. The Company, during the term of this Plan,
will at all times reserve and keep available such number of shares of its
Common Stock as shall be sufficient to satisfy the requirements of the Plan.
14. EFFECTIVE DATE. This Plan, as amended, was adopted by the Board of
Directors of the Company on August 27, 1998, and shall be effective on said
date, subject to approval by the Company's stockholders.
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15. FINANCIAL REPORTS. The Company shall deliver financial and other
information regarding the Company, on an annual or more frequent basis, to
each individual holding an outstanding option under the Plan; provided,
however, that financial statements will not be furnished to key employees
whose duties in connection with the issuer assure them access to equivalent
information.
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APPENDIX C
ORYX TECHNOLOGY CORP.
1996 DIRECTORS NONQUALIFIED STOCK OPTION PLAN
(As amended August 27, 1998)
1. PURPOSE. The purpose of the Oryx Technology Corp. 1996 Directors
Nonqualified Stock Option Plan (the "Plan") is to grant to non-employee
directors ("Outside Directors") of Oryx Technology Corp., a Delaware
corporation (the "Company"), the opportunity to acquire Common Stock of the
Company, thereby encouraging such persons to accept or continue their
relationships with the Company; to align the interests of such persons with
those of the Company's stockholders through stock ownership; and furnishing
such persons with an incentive to improve operations and increase profits of
the Company.
To accomplish the foregoing objectives, this Plan provides a means
whereby Outside Directors may receive options to purchase Common Stock.
Options granted under this Plan will be nonstatutory (nonqualified) stock
options.
2. ADMINISTRATION. The Plan shall be administered by the Compensation
Committee of the Board of Directors of the Company (the "Administrator"),
which shall at all times consist of at least two (2) Outside Directors
neither of whom has received option grants under any plan of the Company or
its affiliates, other than formula-based grants under Rule 16b-3 promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
within one (1) year prior to his service as an administrator of the Plan.
Subject to the provisions of the Plan, the Administrator shall have the sole
authority, in its discretion:
(a) to determine the terms and conditions of the stock option
agreements entered into between the Company and any Outside Director;
(b) to interpret the Plan;
(c) to modify or amend any such option; and
(d) to make all determinations deemed necessary or advisable for
the administration of the Plan.
3. ELIGIBILITY; NUMBER. (a) Each Outside Director serving on the
Company's Board of Directors, as of April 1, 1996 shall be granted options to
purchase 30,000 shares of the Company's Common Stock or such later date on
which such Outside Director was appointed to the Board of Directors. The
exercise price shall be the closing bid price of the Company's Common Stock
on the Nasdaq SmallCap Market on such date.
(b) Each Outside Director joining the Company's Board of Directors
subsequent to April 1, 1996, will receive options to purchase 30,000 shares
of the Company's Common
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Stock, effective as of the date he or she is appointed or elected to the
Company's Board of Directors (the "Grant Date"). The exercise price of such
options shall be the closing bid price of the Company's Common Stock on the
Nasdaq SmallCap Market on the Grant Date.
(c) In the event that the Company's Common Stock is neither listed
on a securities exchange nor quoted by Nasdaq, the Administrator shall
determine the fair market value of the Company's Common Stock on such date
and such value shall be the exercise price.
4. COMMON STOCK SUBJECT TO PLAN.
(a) There shall be reserved for issue upon the exercise of options
granted under the Plan Two Hundred Fifty Thousand (250,000) shares of Common
Stock, subject to adjustment as provided in Section 7 hereof. If an option
granted under the Plan shall expire or terminate for any reason without
having been exercised in full, the unpurchased shares subject thereto shall
again be available for the purposes of the Plan.
(b) Notwithstanding any other provisions of this Plan, the
aggregate number of shares of Common Stock subject to outstanding options
granted under this Plan, plus the aggregate number of shares issued upon the
exercise of all options granted under this Plan, shall never be permitted to
exceed the number of shares specified in the first sentence of subsection
4(a) above.
5. TERMS OF OPTIONS. Each option granted under the Plan shall be
evidenced by a nonstatutory stock option agreement between the individual to
whom the option is granted (the "optionee") and the Company. Each such
agreement shall designate the option thereby granted as a nonstatutory stock
option. Each such agreement shall be subject to the terms and conditions set
forth in subsection 5.1, and to such other terms and conditions not
inconsistent herewith as the Administrator may deem appropriate in each case.
All options granted under this Plan shall be subject to the following terms
and conditions:
(a) TERM OF OPTIONS. The period or periods within which an option
may be exercised shall be determined by the Administrator at the time the
option is granted, but in no event shall such period extend beyond ten (10)
years and one (1) week from the date the option is granted.
(b) MORE THAN TEN PERCENT STOCKHOLDERS. No option shall be granted
to any individual who, at the time such option would be granted, owns stock
possessing more than ten percent (10%) of the total combined voting power of
all classes of outstanding capital stock of the Company, or of any parent
corporation or subsidiary corporation of the Company, unless the exercise
price (as provided in subsection 5.1(b) hereof) is not less than one hundred
ten percent (110%) of the fair market value of the Common Stock on the date
the option is granted. As used in this Plan, the terms "parent corporation"
and "subsidiary corporation" shall have the meanings set forth in Sections
424(e) and (f), respectively, of the Internal Revenue Code of 1986, as
amended (the "Code"). For purposes of this subsection 5.1(b), in determining
stock ownership, an optionee shall be deemed the owner of all voting capital
stock owned, directly or indirectly,
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by or for his brothers and sisters, spouse, ancestors and lineal descendants.
Voting capital stock owned, directly or indirectly, by or for a corporation,
partnership, estate or trust shall be considered as being owned
proportionately by or for its shareholders, partners or beneficiaries, as
applicable. Common Stock with respect to which any such optionee holds an
option shall not be counted. Additionally, for purposes of this subsection
5.1(b), outstanding capital stock shall include all capital stock actually
issued and outstanding immediately after the grant of the option to the
optionee. Outstanding capital stock shall not include capital stock
authorized for issue under outstanding options held by the optionee or by any
other person.
(c) METHOD OF PAYMENT FOR COMMON STOCK. Payment for stock purchased
upon any exercise of an option granted under this Plan shall be made in full
in cash concurrently with such exercise, except that, if and to the extent
the instrument evidencing the option so provides and if the Company is not
then prohibited from purchasing or acquiring shares of such stock, such
payment may be made in whole or in part with shares of the same class of
stock as are subject to the option, delivered in lieu of cash concurrently
with such exercise, the shares so delivered to be valued on the basis of the
fair market value of the stock (determined in a manner specified in the
instrument evidencing the option) on the day preceding the date of exercise.
(d) VESTING. Ten thousand (10,000) of the option shares granted
under the Plan shall vest on the date of grant and the balance shall vest in
equal annual installments on the first and second anniversaries of the date
of grant, provided that the Outside Director continues to serve on the
Company's Board of Directors as of such dates.
(e) NONTRANSFERABILITY. All options shall be nontransferable,
except by will or the laws of descent and distribution, and shall be
exercisable during the lifetime of the optionee only by the optionee.
(f) DEATH; DISABILITY; RESIGNATION. In the event of an Outside
Director's disability, all options granted will immediately vest. In the
event of an Outside Director's death, all options will vest but expire one
year thereafter. If an Outside Director resigns from the Company's Board of
Directors or declines to stand for reelection, options that are vested
through the date of such resignation or declination may be exercised for a
period of three (3) months thereafter. If an Outside Director is removed from
the Board by action of the Company's Stockholders or Board of Directors,
options that are vested through the date of such removal may be exercised for
a period of one (1) week thereafter.
(g) WITHHOLDING AND EMPLOYMENT TAXES. At the time of exercise of an
option, the optionee shall remit to the Company in cash the amount of any and
all applicable federal and state withholding and employment taxes.
6. STOCK ISSUANCE AND RIGHTS AS STOCKHOLDER. Notwithstanding any other
provisions of the Plan, no optionee shall have any of the rights of a
stockholder (including the right to vote and receive dividends) of the
Company, by reason of the provisions of this Plan or any action taken
hereunder, until the date such optionee shall both have paid the exercise
price for the Common Stock and shall have been issued (as evidenced by the
appropriate entry on the books
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of the Company or of a duly authorized transfer agent of the Company) the
stock certificate evidencing such shares.
7. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.
(a) Subject to any required action by the Company's stockholders,
the number of shares of Common Stock covered by this Plan as provided in
Section 4, the number of shares covered by each outstanding option granted
hereunder and the exercise price thereof shall be proportionately adjusted
for any increase or decrease in the number of issued shares of Common Stock
resulting from a split, reverse split, subdivision or consolidation of such
shares or the payment of a stock dividend (but only on the Common Stock) or
any other increase or decrease in the number of such outstanding shares of
Common Stock effected without the receipt of consideration by the Company;
provided, however, that the conversion of any convertible securities of the
Company shall not be deemed to have been "effected without receipt of
consideration."
(b) Subject to any required action by the Company's stockholders,
if the Company shall be the surviving corporation in any merger or
consolidation, each outstanding option shall pertain and apply to the
securities to which a holder of the number of shares subject to the option
would have been entitled. A dissolution or liquidation of the Company or a
merger or consolidation in which the Company is not the surviving corporation
shall cause each outstanding option to terminate, unless the surviving
corporation in the case of a merger or consolidation assumes outstanding
options or replaces them with substitute options having substantially similar
terms and conditions.
(c) To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Compensation
Committee of the Board of Directors, whose determination in that respect
shall be final, binding and conclusive.
(d) Except as hereinabove expressly provided in this Section 7, no
optionee shall have any rights by reason of any subdivision or consolidation
of shares of the capital stock of any class or the payment of any stock
dividend or any other increase or decrease in the number of shares of any
class or by reason of any dissolution, liquidation, merger or consolidation
or spin-off of assets or stock of another corporation, and any issue by the
Company of shares of stock of any class or of securities convertible into
shares of stock of any class shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares subject
to any option granted hereunder.
(e) The grant of an option pursuant to this Plan shall not affect
in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge or consolidate or to dissolve, liquidate, sell or
transfer all or any part of its business or assets.
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8. SECURITIES LAW REQUIREMENTS.
(a) The Administrator may require an individual as a condition of
the grant and of the exercise of an option, to represent and establish to the
satisfaction of the Administrator that all shares of Common Stock to be
acquired upon the exercise of such option will be acquired for investment and
not for resale. The Administrator shall cause such legends to be placed on
certificates evidencing shares of Common Stock issued upon exercise of an
option as, in the opinion of the Company's counsel, may be required by
federal and applicable state securities laws.
(b) No shares of Common Stock shall be issued upon the exercise of
any option unless and until counsel for the Company determines that: (i) the
Company and the optionee have satisfied all applicable requirements under the
Securities Act of 1933, as amended and the Exchange Act; (ii) any applicable
listing requirement of any stock exchange on which the Company's Common Stock
is listed has been satisfied; and (iii) all other applicable provisions of
state and federal law have been satisfied.
9. FINANCIAL ASSISTANCE. The Company is vested with authority under this
Plan to assist any Outside Director to whom an option is granted hereunder in
the payment of the purchase price payable on exercise of that option, by
lending the amount of such purchase price to such Outside Director on such
terms and at such rates of interest and upon such security as shall have been
authorized by or under authority of the Board.
10. AMENDMENT. The Board may terminate the Plan or amend the Plan from
time to time in such respects as the Board may deem advisable; provided,
however, that the Plan may no be amended more than once every six (6) months,
other than to comport with changes in the Internal Revenue Code of 1986, as
amended, the Employee Retirement Income Security Act, of the rules
thereunder, and provided further, that, without the approval of the Company's
stockholders in compliance with the requirements of applicable law, no such
revision or amendment shall:
(a) increase the number of shares of Common Stock reserved under
Section 4 hereof for issue under the Plan, except as provided in Section 7
hereof;
(b) change the class of persons eligible to participate in the Plan
under Section 3 hereof;
(c) extend the term of the Plan under Section 10 hereof;
(d) change the number of options granted under this Plan as set
forth in Section 3 hereof; or
(e) amend this Section 10 to defeat its purpose.
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11. TERMINATION. The Plan shall terminate automatically on April 1,
2006, and may be terminated at any earlier date by the Board. No option shall
be granted hereunder after termination of the Plan, but such termination
shall not affect the validity of any option then outstanding.
12. TIME OF GRANTING OPTIONS. The date of grant of an option hereunder
shall, for all purposes, be the date on which the Administrator makes the
determination granting such option.
13. RESERVATION OF SHARES. The Company, during the term of this Plan,
will at all times reserve and keep available such number of shares of its
Common Stock as shall be sufficient to satisfy the requirements of the Plan.
14. EFFECTIVE DATE. This Plan, as amended, was adopted by the Board of
Directors of the Company on August 27, 1998, and shall be effective as of
said date, subject to approval by the Company's stockholders.
6