<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 28, 1998
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FVC.COM, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 77-0357037
(State of Incorporation) (I.R.S. Employer Identification Number)
-------------------
3393 OCTAVIUS DRIVE
SUITE 102
SANTA CLARA, CA 95054
(408) 567-7200
-------------------
OPTIONS ASSUMED BY FVC.COM, INC.
ORIGINALLY GRANTED UNDER THE
ICAST CORPORATION
1996 STOCK OPTION PLAN
James O. Mitchell
Chief Financial Officer
First Virtual Corporation
3393 Octavius Drive
Suite 102
Santa Clara, CA 95054
(408) 567-7200
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
-------------------
Copies to:
LEE F. BENTON, ESQ.
COOLEY GODWARD LLP
FIVE PALO ALTO SQUARE
3000 EL CAMINO REAL
PALO ALTO, CALIFORNIA 94306
-------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED PER SHARE (1) PRICE (1) REGISTRATION FEE
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Stock Options and 20,582 $.34 - $8.50 $111,348.62 $32.85
Common Stock
(par value $.001)
- --------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the amount of the
registration fee. The offering price is based upon the exercise prices for
shares previously granted under the ICAST Corporation ("ICAST") 1996 Stock
Option Plan, pursuant to Rule 457(h) under the Securities Act of 1933, as
amended (the "Act").
<PAGE>
Approximate date of commencement of proposed sale to the public: As soon
as practicable after this Registration Statement becomes effective.
The stock options to be registered hereunder have been assumed by FVC.COM,
Inc. ("FVC") pursuant to an Agreement and Plan of Merger and
Reorganization, dated as of July 30, 1998, among FVC, FVC Acquisition
Corp., a California corporation and wholly-owned subsidiary of FVC, ICAST
Corporation, a California corporation ("ICAST") and certain shareholders of
ICAST. These options were originally granted to employees and consultants
of ICAST under the ICAST 1996 Stock Option Plan.
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by FVC.COM, INC. (the "Company")
with the Securities and Exchange Commission are incorporated by
reference into this Registration Statement:
(a) The Company's latest prospectus filed pursuant to Rule 424(b)
under the Securities Act of 1933, as amended (the "Securities Act"),
that contains audited financial statements for the Company's latest
fiscal year for which such statements have been filed.
(b) All other reports filed pursuant to Sections 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
since the end of the fiscal year covered by the prospectus referred to
in (a) above.
(c) The description of the Company's Common Stock which is
contained in registration statement no. 333-38755 filed on October 24,
1997 and declared effective on April 29, 1998, as amended, under the
Securities Act, including any amendment or report filed for the
purpose of updating such description.
All reports and other documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
prior to the filing of a post-effective amendment which indicates that
all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated
by reference herein and to be a part of this registration statement
from the date of the filing of such reports and documents.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under Section 145 of the Delaware General Corporation Law the
Company has broad powers to indemnify its directors and officers
against liabilities they may incur in such capacities, including
liabilities under the Securities Act. The Company's Bylaws also
provide that the Company will indemnify its directors and executive
officers, and may indemnify its other officers, employees and other
agents, to the fullest extent not prohibited by Delaware law.
The Company's Certificate of Incorporation provides for the
elimination of liability for monetary damages for breach of the
directors' fiduciary duty of care to the Company and its stockholders.
These provisions do not eliminate the directors' duty of care and, in
appropriate circumstances, equitable remedies such as injunctive or
other forms of non-monetary relief will remain available under
Delaware law. In addition, each director will continue to be subject
to liability for breach of the director's duty of loyalty to the
Company, for acts or omissions not in good faith or involving
intentional misconduct, for knowing violations of law, for any
transaction from which the director derived an improper personal
benefit, and for payment of dividends or approval of stock repurchases
or redemptions that are unlawful under Delaware law. The provision
does not affect a director's responsibilities under any other laws,
such as the federal securities laws or state or federal environmental
laws.
The Company has entered into agreements with its directors and
executive officers that require the Company to indemnify such persons
against expenses, judgments, fines, settlements and other amounts
actually and reasonably incurred (including expenses of a
2.
<PAGE>
derivative action) in connection with any proceeding, whether actual or
threatened, to which any such person may be made a party by reason of
the fact that such person is or was a director or officer of the
Company or any of its affiliated enterprises, provided such person
acted in good faith and in a manner such person reasonably believed to
be in or not opposed to the best interests of the Company and, with
respect to any criminal proceeding, had no reasonable cause to believe
his conduct was unlawful. The indemnification agreements also set
forth certain procedures that will apply in the event of a claim for
indemnification thereunder.
In addition, the Company has entered into certain agreements in
connection with the Company's equity financings which provide for the
indemnification of directors and officers in certain circumstances,
including indemnification for liabilities arising under the Securities
Act. The Company also maintains an insurance policy for its directors
and officers insuring against certain liabilities arising in their
capacities as such.
EXHIBITS
EXHIBIT
NUMBER
5.1 Opinion of Cooley Godward LLP
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Cooley Godward LLP is contained in Exhibit 5.1 to this
Registration Statement
24.1 Power of Attorney is contained on the signature page
99.1 ICAST Corporation 1996 Stock Option Plan
3.
<PAGE>
UNDERTAKINGS
1. The undersigned registrant hereby undertakes:
(a) 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;
(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. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in
the registration statement;
PROVIDED, HOWEVER, that paragraphs (a)(i) and (a)(ii) do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference herein.
(b) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) 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.
2. The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each
filing of the registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the 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 herein shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
3. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event
that a claim for
4.
<PAGE>
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act and will
be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Santa Clara, State of California, on August 18,
1998.
FVC.COM, INC.
By: /s/ RALPH UNGERMANN
----------------------------
Ralph Ungermann
President and Chief Executive Officer
5.
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Ralph Ungermann and James O. Mitchell,
and each or any one of them, his true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this registration statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Commission, granting unto said attorneys-in-fact and agents,
and each of them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitutes or substitute, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ---------------------------- ------------------------------------ ----------------
<S> <C> <C>
/s/ RALPH UNGERMANN President, Chief Executive August 18, 1998
- ----------------------------- Officer and Director
Ralph Ungermann (PRINCIPAL EXECUTIVE OFFICER)
/s/ JAMES O. MITCHELL Vice President, Operations and August 18, 1998
- ----------------------------- Chief Financial Officer
James O. Mitchell (PRINCIPAL FINANCIAL AND
ACCOUNTING OFFICER)
Director August __, 1998
- -----------------------------
Neal Douglas
/s/ PIER CARLO FALOTTI Director August 17, 1998
- -----------------------------
Pier Carlo Falotti
/s/ DAVID A. NORMAN Director August 18, 1998
- -----------------------------
David A. Norman
/s/ JAMES SWARTZ Director August 17, 1998
- -----------------------------
James Swartz
/s/ ENZO TORRESI Director August 17, 1998
- -----------------------------
Enzo Torresi
</TABLE>
6.
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
5.1 Opinion of Cooley Godward LLP
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Cooley Godward LLP is contained in Exhibit 5.1
to this Registration Statement
24.1 Power of Attorney is contained on signature page
99.1 ICAST Corporation 1996 Stock Option Plan
7.
<PAGE>
EXHIBIT 5.1
Michael J. Sullivan, Esq.
DIRECT: (650) 843-5265
INTERNET: [email protected]
August 28, 1998
FVC.COM, INC.
3393 Octavius Drive, Suite 102
Santa Clara, CA 95054
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection
with the filing by FVC.COM, INC. (the "Company") of a Registration Statement on
Form S-8 (the "Registration Statement") with the Securities and Exchange
Commission covering the offering of an aggregate of 20,582 shares of the
Company's Common Stock, $.001 par value (the "Shares"), issuable upon exercise
of options originally granted by ICAST CORPORATION ("ICAST"), a wholly owned
subsidiary of the Company, under the ICAST 1996 Stock Option Plan (the "Plan").
In connection with this opinion, we have examined the Registration Statement and
related Prospectus, your Amended and Restated Certificate of Incorporation and
Bylaws and such other documents, records, certificates, memoranda and other
instruments as we deem necessary as a basis for this opinion. We have assumed
the genuineness and authenticity of all documents submitted to us as originals,
the conformity to originals of all documents submitted to us as copies thereof,
and the due execution and delivery of all documents where due execution and
delivery are a prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the opinion
that the Shares, when sold and issued in accordance with the Plan, the
Registration Statement and the related Prospectus, will be validly issued, fully
paid, and nonassessable (except as to shares issued pursuant to certain deferred
payment arrangements, which will be fully paid and nonassessable when such
deferred payments are made in full).
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
Cooley Godward LLP
By: /s/ MICHAEL J. SULLIVAN
------------------------------
Michael J. Sullivan
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement of our report dated January 30, 1998, except as to Note 10 which is
dated as of April 28, 1998, which appears on page F-2 of the Registration
Statement on Form S-1 (File No. 333-38755) of FVC. COM, Inc. (formerly First
Virtual Corporation) dated April 29, 1998.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
San Jose, California
August 24, 1998
9.
<PAGE>
EXHIBIT 99.1
ICAST CORPORATION
1996 STOCK OPTION PLAN
As Adopted September 15, 1996
(Amended January 3, 1997 and March 17, 1997)
1. PURPOSE. The purpose of this Plan is to provide incentives to
attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options. Capitalized terms not defined
in the text are defined in Section 2I hereof. This Plan is intended to be a
written compensatory benefit plan within the meaning of Rule 701 promulgated
under the Securities Act.
2. SHARES SUBJECT TO THE PLAN.
2.1 NUMBER OF SHARES AVAILABLE. Subject to Sections 2.2 and 16
hereof, the total number of Shares reserved and available for grant and
issuance pursuant to this Plan will be 2,690,000 Shares or such lesser number
of Shares as permitted under Section 260.140.45 of Title 10 of the California
Code of Regulations. Subject to Sections 2.2 and 16 hereof, Shares that are
subject to issuance upon exercise of an Option but cease to be subject to
such Option for any reason other than exercise of such Option will be
available for grant and issuance in connection with future Options under this
Plan. At all times the Company will reserve and keep available a sufficient
number of Shares as will be required to satisfy the requirements of all
outstanding Options granted under this Plan.
2.2 ADJUSTMENT OF SHARES. In the event that the number of
outstanding shares of the Company's Common Stock is changed by a stock
dividend, recapitalization, stock split, reverse stock split, subdivision,
combination, reclassification or similar change in the capital structure of
the Company without consideration, then (a) the number of Shares reserved for
issuance under this Plan and (b) the Exercise Prices of and number of Shares
subject to outstanding Options, will be proportionately adjusted, subject to
any required action by the Board or the shareholders of the Company and
compliance with applicable securities laws; provided, however, that fractions
of a Share will not be issued but will either be paid in cash at the Fair
Market Value of such fraction of a Share or will be rounded down to the
nearest whole Share, as determined by the Committee in its discretion.
3. ELIGIBILITY. ISOs (as defined in Section 5 hereof) may be granted
only to employees (including officers and directors who are also employees)
of the Company or of a Parent or Subsidiary of the Company. NQSOs (as
defined in Section 5 hereof) may be granted to employees, officers, directors
and consultants of the Company or of any Parent or Subsidiary of the Company;
provided such consultants render bona fide services not in connection with
the offer and sale of securities in a capital-raising transaction. A person
may be granted more than one Option under this Plan.
4. ADMINISTRATION.
4.1 COMMITTEE AUTHORITY. This Plan will be administered by the
Committee or the Board acting as the Committee. Subject to the general
purposes, terms and conditions of this Plan, and to the direction of the
Board, the Committee has full power to implement and carry out this Plan.
Without limitation, the Committee has the authority to:
(a) construe and interpret this Plan, any Stock Option Agreement
or Exercise Agreement (each as defined in Section 5 hereof
and any other agreement or document executed pursuant to
this Plan;
(b) prescribe, amend and rescind rules and regulations relating
to this Plan;
<PAGE>
(c) select persons to receive Options;
(d) determine the form and terms of Options;
(e) determine the number of Shares or other consideration
subject to Options;
(f) determine whether Options will be granted singly. in
combination with, in tandem with. in replacement of, or as
alternatives to, any Options granted under this Plan or any
awards under any other incentive or compensation plan of
the Company or any Parent or Subsidiary of the Company;
(g) grant waivers of Plan or Option conditions;
(h) correct any defect, supply any omission, or reconcile any
inconsistency in this Plan, any Option or any Stock Option
Agreement or Exercise Agreement (each as defined in
Section 5 hereof);
(i) determine whether an Option has been earned; and
(j) make all other determinations necessary or advisable for the
administration of this Plan.
4.2 COMMITTEE DISCRETION. Any determination made by the Committee
with respect to any Option will be made in its sole discretion at the time of
grant of the Option or, unless in contravention of any express term of this
Plan or Option, and subject to Section 5.9 hereof, at any later time, and
such determination will be final and binding on the Company and on all
persons having an interest in any Option under this Plan. The Committee may
delegate to one or more officers of the Company the authority to grant
Options under this Plan.
5. OPTIONS. The Committee may grant Options to eligible persons and
will determine whether such Options will be Incentive Stock Options within
the meaning of the Code ("IS0s") or Nonqualified Stock Options ("NQSOs"), the
number of Shares subject to the Option, the Exercise Price of the Option, the
period during which the Option may be exercised, and all other terms and
conditions of the Option, subject to the following:
5.1 FORM OF OPTION GRANT. Each Option granted under this Plan
will be evidenced by an Agreement which will expressly identify the Option as
an ISO or an NQSO ("Stock Option Agreement"), and will be in such form and
contain such provisions (which need not be the same for each Participant) as
the Committee may from time to time approve, and which will comply with and
be subject to the terms and conditions of this Plan.
5.2 DATE OF GRANT. The date of grant of an Option will be the
date on which the Committee makes the determination to grant such Option,
unless otherwise specified by the Committee. The Stock Option Agreement and
a copy of this Plan will be delivered to the Participant within a reasonable
time after the granting of the Option.
5.3 EXERCISE PERIOD. Options may be exercisable immediately
(subject to repurchase pursuant to Section 10 hereof) or may be exercisable
within the times or upon the events determined by the Committee as set forth
in the Stock Option Agreement governing such Option; provided, however, that
no Option will be exercisable after the expiration often (10) years from the
date the Option is granted; and provided further that no ISO granted to a
person who directly or by attribution owns more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or of any
Parent or Subsidiary of the Company ("Ten Percent Shareholder'3 will be
exercisable after the expiration of five (5) years from the date the ISO is
granted. The Committee may provide for Options to become exercisable at one
time or from time to time, periodically or otherwise, in such number of
Shares or percentage of Shares as the Committee determines. Subject to
earlier termination of the Option as provided herein, each Participant who is
not an officer, director or consultant of the
2.
<PAGE>
Company or of a Parent or Subsidiary of the Company shall have the right to
exercise an Option granted hereunder at the rate of at least twenty percent
(20%) per year over five (5) years from the date such Option is granted.
5.4 EXERCISE PRICE. The Exercise Price of an Option will be
determined by the Committee when the Option is granted and may not be less
than eighty five percent (85%) of the Fair Market Value of the Shares on the
date of grant; provided that (a) the Exercise Price of an ISO will not be
less than one hundred percent (100%) of the Fair Market Value of the Shares
on the date of grant and (b) the Exercise Price of any Option granted to a
Ten Percent Shareholder will not be less than one hundred ten percent (110%)
of the Fair Market Value of the Shares on the date of grant. Payment for the
Shares purchased must be made in accordance with Section 6 hereof.
5.5 METHOD OF EXERCISE. Options may be exercised only by delivery
to the Company of a written stock option exercise agreement (the "Exercise
Agreement") in a form approved by the Committee (which need not be the same
for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement,
if any, and such representations and agreements regarding Participant's
investment intent and access to information and other matters, if any, as may
be required or desirable by the Company to comply with applicable securities
laws, together with payment in full of the Exercise Price, and any applicable
taxes, for the number of Shares being purchased.
5.6 TERMINATION. Subject to earlier termination pursuant to
Sections 16 or 17 hereof and notwithstanding the exercise periods set forth
in the Stock Option Agreement, exercise of an Option will always be subject
to the following:
(a) If the Participant is Terminated for any reason except
death, Disability or Cause, then the Participant may
exercise such Participant's Options, only to the extent
that such Options are exercisable on the Termination
Date and such Options must be exercised by the Participant,
if at all, as to all or some of the Vested Shares
calculated as of the Termination Date, within three
(3) months after the Termination Date (or within such
shorter time period, not less than thirty (30) days after
the Termination Date, or such longer time period not
exceeding five (5) years after the Termination Date as may
be determined by the Committee, with any exercise after
three (3) months after the Termination Date deemed to be
an NQSO), but in any event, no later than the expiration
date of the Options.
(b) If the Participant is Terminated because of Participant's
death or Disability (or the Participant dies within three
(3) months after Participant's Termination other than for
Cause), then Participant's Options may be exercised, only
to the extent that such Options are exercisable by
Participant on the Termination Date and must be exercised
by Participant (or Participant's legal representative or
authorized assignee), if at all, as to all or some of the
Vested Shares calculated as of the Termination Date, within
twelve (12) months after the Termination Date (or within
such shorter time period, not less than six (6) months
after the Termination Date, or such longer time period not
exceeding five (5) years after the Termination Date as may
be determined by the Committee, with any exercise after
(i) three (3) months after the Termination Date when the
Termination is for any reason other than the Participant's
death or disability, within the meaning of Code Section
22(e)(3), or (ii) twelve (12) months after the Termination
Date when the Termination is because of Participant's
disability, within the meaning of Code Section 22(eX3),
deemed to be an NQSO), but in any event no later than the
expiration date of the Options.
(c) If the Participant is terminated for Cause, then
Participant's Options shall expire on such Participant's
Termination Date, or at such later time and on such
conditions as are determined by the Committee.
3.
<PAGE>
5.7 LIMITATIONS ON EXERCISE. The Committee may specify a
reasonable minimum number of Shares that may be purchased on exercise of an
Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.
5.8 LIMITATIONS ON ISOS. The aggregate Fair Market Value
(determined as of the date of grant) of Shares with respect to which ISOs are
exercisable for the first time by a Participant during any calendar year
(under this Plan or under any other incentive stock option plan of the
Company or any Parent or Subsidiary of the Company) will not exceed $100,000.
If the Fair Market Value of Shares on the date of grant with respect to which
ISOs are exercisable for the first time by a Participant during any calendar
year exceeds $100,000, then the Options for the first $100,000 worth of
Shares to become exercisable in such calendar year will be ISOs and the
Options for the amount in excess of $100,000 that become exercisable in that
calendar year will be NQSOs. In the event that the Code or the regulations
promulgated thereunder are amended after the Effective Date (as defined in
Section 17 hereof) to provide for a different limit on the Fair Market Value
of Shares permitted to be subject to ISOs, then such different limit will be
automatically incorporated herein and will apply to any Options granted after
the effective date of such amendment.
5.9 MODIFICATION, EXTENSION OR RENEWAL. The Committee may modify,
extend or renew outstanding Options and authorize the grant of new Options in
substitution therefor, provided that any such action may not, without the
written consent of a Participant, impair any of such Participant's rights
under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered will be treated in accordance with
Section 424(h) of the Code. Subject to Section 5.10 hereof, the Committee
may reduce the Exercise Price of outstanding Options without the consent of
Participants affected by a written notice to them; provided, however, that
the Exercise Price may not be reduced below the minimum Exercise Price that
would be pertained under Section 5.4 hereof for Options granted on the date
the action is taken to reduce the Exercise Price.
5.10 NO DISQUALIFICATION. Notwithstanding any other provision in
this Plan, no term of this Plan relating to ISOs will be interpreted, amended
or altered, nor will any discretion or authority granted under this Plan be
exercised, so as to disqualify this Plan under Section 422 of the Code or,
without the consent of the Participant affected, to disqualify any ISO under
Section 422 of the Code.
6. PAYMENT FOR SHARE PURCHASES.
6.1 PAYMENT. Payment for Shares purchased pursuant to this Plan may
be made in cash (by check) or, where expressly approved for the Participant by
the Committee and where permitted by law:
(a) by tender of a full recourse promissory note having such
terms as may be approved by the Committee and bearing
interest at a rate sufficient to avoid imputation of
income under Sections 483 and 1274 of the Code; provided,
however, that Participants who are not employees or
directors of the Company will not be entitled to
purchase Shares with a promissory note unless the note
is adequately secured by collateral other than the Shares
(i) through a "same day sale" commitment from the
Participant and a broker-dealer that is a member of
the National Association of Securities Dealers (an
"NASD Dealer") whereby the Participant irrevocably
elects to exercise the Option and to sell a portion
of the Shares so purchased to pay for the Exercise
Price, and whereby the NASD Dealer irrevocably commits
upon receipt of such Shares to forward the Exercise
Price directly to the Company; or
(ii) through a "margin" commitment from the Participant and
an NASD Dealer whereby the Participant irrevocably
elects to exercise the Option and to pledge the Shares
so purchased to the NASD Dealer in a
4.
<PAGE>
margin account as security for a loan from the NASD
Dealer in the amount of the Exercise Price, and
whereby the NASD Dealer irrevocably commits upon
receipt of such Shares to forward the Exercise Price
directly to the Company; or
(b) by any combination of the foregoing.
7. WITHHOLDING TAXES. Whenever Shares are to be issued in
satisfaction of Options granted under this Plan, the Company may require the
Participant to remit to the Company an amount sufficient to satisfy federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for such Shares. Whenever, under this Plan,
payments in satisfaction of Options are to be made in cash, such payment will
be net of an amount sufficient to satisfy federal, state, and local
withholding tax requirements.
8. PRIVILEGES OF STOCK OWNERSHIP.
8.1 VOTING AND DIVIDENDS. No Participant will have any of the
rights of a shareholder with respect to any Shares until the Shares are
issued to the Participant. After Shares are issued to the Participant, the
Participant will be a shareholder and have all the rights of a shareholder
with respect to such Shares, including the right to vote and receive all
dividends or other distributions made or paid with respect to such Shares;
provided, that the Participant will have no right to retain such stock
dividends or stock distributions with respect to Unvested Shares that are
repurchased pursuant to Section 10 hereof. The Company will comply with
Section 260.140.1 of Title 10 of the California Code of Regulations with
respect to the voting rights of Common Stock.
8.2 FINANCIAL STATEMENTS. The Company will provide financial
statements to each Participant prior to such Participant's purchase of Shares
under this Plan, and to each Participant annually during the period such
Participant has Options outstanding, or as otherwise required under Section
260.140.46 of Title 10 of the California Code of Regulations.
Notwithstanding the foregoing, the Company will not be required to provide
such financial statements to Participants when issuance is limited to key
employees whose services in connection with the Company assure them access to
equivalent information.
9. TRANSFERABILITY. Options granted under this Plan, and any interest
therein, will not be transferable or assignable by Participant, and may not
be made subject to execution, attachment or similar process, otherwise than
by will or by the laws of descent and distribution. During the lifetime of
the Participant an Option will be exercisable only by the Participant or
Participant's legal representative and any elections with respect to an
Option may be made only by the Participant or Participant's legal
representative.
9.1 RIGHT OF FIRST REFUSAL. At the discretion of the Committee,
the Company may reserve to itself and/or its assignee(s) in the Stock Option
Agreement a right of first refusal to purchase all Shares that a Participant
(or a subsequent transferee) may propose to transfer to a third party, unless
otherwise not permitted by Section 25102(o) of the California Corporations
Code, provided, that such right of first refusal terminates upon the
Company's initial public offering of Common Stock pursuant to an effective
registration statement filed under the Securities Act.
9.2 RIGHT OF REPURCHASE. At the discretion of the Committee, the
Company may reserve to itself and/or its assignee(s) in the Stock Option
Agreement a right to repurchase Unvested Shares held by a Participant
following such Participant's Termination at any time within ninety (90) days
after Participant's Termination Date (or in the case of securities issued
upon exercise of an Option after the Participant's Termination Date, within
ninety (90) days after the date of such exercise) for cash and/or
cancellation of purchase money indebtedness, at the Participant's Exercise
Price, provided, that to the extent the Participant is not an officer,
director or consultant of the Company or of a Parent or Subsidiary of the
Company such right to repurchase Unvested Shares lapses at the rate of at
least twenty percent (20%) per year over five (5) years from the date of
grant of the Option.
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10. CERTIFICATES. All certificates for Shares or other securities
delivered under this Plan will be subject to such stock transfer orders,
legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or
foreign securities law, or any rules, regulations and other requirements of
the SEC or any stock exchange or automated quotation system upon which the
Shares may be listed or quoted.
11. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares, the Committee may require the Participant to deposit
all certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in
escrow until such restrictions have lapsed or terminated, and the Committee
may cause a legend or legends referencing such restrictions to be placed on
the certificates. Any Participant who is permitted to execute a promissory
note as partial or full consideration for the purchase of Shares under this
Plan will be required to pledge and deposit with the Company all or part of
the Shares so purchased as collateral to secure the payment of Participant's
obligation to the Company under the promissory note; provided, however, that
the Committee may require or accept other or additional forms of collateral
to secure the payment of such obligation and, in any event, the Company will
have full recourse against the Participant under the promissory note
notwithstanding any pledge of the Participant's Shares or other collateral.
In connection with any pledge of the Shares, Participant will be required to
execute and deliver a written pledge agreement in such form as the Committee
will from time to time approve. The Shares purchased with the promissory
note may be released from the pledge on a pro rata basis as the promissory
note is paid.
12. EXCHANGE AND BUYOUT OF OPTIONS. The Committee may, at any time or
from time to time, authorize the Company, with the consent of the respective
Participants, to issue new Options in exchange for the surrender and
cancellation of any or all outstanding Options. The Committee may at any
time buy from a Participant an Option previously granted with payment in
cash, shares of Common Stock of the Company (including restricted stock) or
other consideration, based on such terms and conditions as the Committee and
the Participant may agree.
13. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. This Plan is
intended to comply with Section 25102(o) of the California Corporations Code.
Any provision of this Plan which is inconsistent with Section 25102(0)
shall, without further act or amendment by the Company or the Board, be
reformed to comply with the requirements of Section 25102(o). An Option will
not be effective unless such Option is in compliance with all applicable
federal and state securities laws, rules and regulations of any governmental
body, and the requirements of any stock exchange or automated quotation
system upon which the Shares may then be listed or quoted, as they are in
effect on the date of grant of the Option and also on the date of exercise or
other issuance. Notwithstanding any other provision in this Plan, the Company
will have no obligation to issue or deliver certificates for Shares under
this Plan prior to (a) obtaining any approvals from governmental agencies
that the Company determines are necessary or advisable, and/or (b) compliance
with any exemption, completion of any registration or other qualification of
such Shares under any state or federal law or ruling of any governmental body
that the Company determines to be necessary or advisable. The Company will
be under no obligation to register the Shares with the SEC or to effect
compliance with the exemption, registration, qualification or listing
requirements of any state securities laws, stock exchange or automated
quotation system, and the Company will have no liability for any inability or
failure to do so.
14. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Option granted
under this Plan will confer or be deemed to confer on any Participant any
right to continue in the employ of, or to continue any other relationship
with, the Company or any Parent or Subsidiary of the Company or limit in any
way the right of the Company or any Parent or Subsidiary of the Company to
terminate Participant's employment or other relationship at any tune, with or
without cause.
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15. CORPORATE TRANSACTIONS.
15.1 ASSUMPTION OR REPLACEMENT OF OPTIONS BY SUCCESSOR OR ACQUIRING
COMPANY. In the event of (a) a dissolution or liquidation of the Company,
(b) a merger or consolidation in which the Company is not the surviving
corporation (other than a merger or consolidation with a wholly=owned
subsidiary, a reincorporation of the Company in a different jurisdiction, or
other transaction in which there is no substantial change in the shareholders
of the Company or their relative stock holdings and the Options granted under
this Plan are assumed, converted or replaced by the successor or acquiring
corporation, which assumption, conversion or replacement will be binding on
all Participants), (c) a merger in which the Company is the surviving
corporation but after which the shareholders of the Company immediately prior
to such merger (other than any shareholder which merges with the Company in
such merger, or which owns or controls another corporation which merges, with
the Company in such merger) cease to own their shares or other equity
interests in the Company, or (d) the sale of all or substantially all of the
assets of the Company, any or all outstanding Options may be assumed,
converted or replaced by the successor or acquiring corporation (if any),
which assumption, conversion or replacement will be binding on all
Participants. In the alternative, the successor or acquiring corporation may
substitute equivalent Options or provide substantially similar consideration
to Participants as was provided to shareholders (after taking into account
the existing provisions of the Options). The successor or acquiring
corporation may also issue, in place of outstanding Shares of the Company
held by the Participant, substantially similar shares or other property
subject to repurchase restrictions and other provisions no less favorable to
the Participant than those which applied to such outstanding Shares
immediately prior to such transaction described in this Section 16.1. In the
event such successor or acquiring corporation (if any) does not assume or
substitute Options, as provided above, pursuant to a transaction described in
this Section 16.1, then notwithstanding any other provision in this Plan to
the contrary, the vesting of such Options will accelerate and the Options
will become exercisable in full prior to the consummation of such event at
such times and on such conditions as the Committee determines, and if such
Options are not exercised prior to the consummation of the corporate
transaction, they shall terminate in accordance with the provisions of this
Plan.
15.2 OTHER TREATMENT OF OPTIONS. Subject to any greater rights
granted to Participants under the foregoing provisions of this Section 16, in
the event of the occurrence of any transaction described in Section 16.1
hereof, any outstanding Options will be treated as provided in the applicable
agreement or plan of merger, consolidation, dissolution, liquidation or sale
of assets.
15.3 ASSUMPTION OF OPTIONS BY THE COMPANY. The Company, from time
to time, also may substitute or assume outstanding options granted by another
company, whether in connection with an acquisition of such other company or
otherwise, by either (a) granting an Option under this Plan in substitution
of such other company's option, or (b) assuming such option as if it had been
granted under this Plan if the terms of such assumed option could be applied
to an Option granted under this Plan. Such substitution or assumption will
be permissible if the holder of the substituted or assumed option would have
been eligible to be granted an Option under this Plan if the other company
had applied the rules of this Plan to such grant. In the event the Company
assumes an option granted by another company, the terms and conditions of
such option will remain unchanged (except that the exercise price and the
number and nature of shares issuable upon exercise of any such option will be
adjusted appropriately pursuant to Section 424(a) of the Code). In the event
the Company elects to grant a new Option rather than assuming an existing
option, such new Option may be granted with a similarly adjusted Exercise
Price.
16. ADOPTION AND SHAREHOLDER APPROVAL. This Plan will become effective
on the date that it is adopted by the Board (the "Effective Date"). This
Plan will be approved by the shareholders of the Company (excluding Shares
issued pursuant to this Plan), consistent with applicable laws, within twelve
(12) months before or after the Effective Date. Upon the Effective Date, the
Board may grant Options pursuant to this Plan; provided, however, that: (a)
no Option may be exercised prior to initial shareholder approval of this
Plan, and (b) no Option granted pursuant to an increase in the number of
Shares approved by the Board shall be exercised prior to the time such
increase has been approved by the shareholders of the Company. In the event
that initial shareholder approval is not obtained within twelve (12) months
before or after this Plan is adopted by the Board, all Options granted
hereunder will be canceled.
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17. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided
herein, this Plan will terminate ten (10) years from the Effective Date or,
if earlier, the date of shareholder approval. This Plan and all agreements
hereunder shall be governed by and construed in accordance with the laws of
the State of California.
18. AMENDMENT OR TERMINATION OF PLAN. Subject to Section 5.9 hereof,
the Board may at any time terminate or amend this Plan in any respect,
including without limitation amendment of any form of Stock Option Agreement
or instrument to be executed pursuant to this Plan; provided, however, that
the Board will not, without the approval of the shareholders of the Company,
amend this Plan in any manner that requires such shareholder approval
pursuant to Section 25102(o) of the California Corporations Code or the Code
or the regulations promulgated thereunder as such provisions apply to ISO
plans.
19. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by
the Board, the submission of this Plan to the shareholders of the Company for
approval, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including, without limitation, the
granting of stock options or any other equity awards outside of this Plan,
and such arrangements may be either generally applicable or applicable only
in specific cases.
20. DEFINITIONS. As used in this Plan, the following terms will have
the following meanings: "Board" means the Board of Directors of the Company.
"Cause" means Termination because of (i) any willful material violation
by the Participant of any law or regulation applicable to the business of the
Company or a Parent or Subsidiary of the Company, the Participant's
conviction for or guilty plea to, a felony or a crime involving moral
turpitude or any willful perpetration by the Participant of a common law
fraud, (ii) the Participant's commission of an act of personal dishonesty
which involves a personal profit in connection with the Company or any other
entity having a business relationship with the Company, (iii) any material
breach by the Participant of any material provision of any agreement or
understanding between the Company or a Parent or Subsidiary of the Company
and the Participant regarding the terms of the Participant's service as an
employee, director or consultant to the Company or a Parent or Subsidiary of
the Company, including without limitation, the willful and continued failure
or refusal of the Participant to perform the material duties required of such
Participant as an employee, director or consultant of the Company or a Parent
or Subsidiary of the Company, other than as a result of having a Disability,
or a breach of any applicable invention assignment and confidentiality
agreement or similar agreement between the Company or a Parent or Subsidiary
of the Company and the Participant, (iv) Participant's intentional disregard
of the policies of the Company or a Parent or Subsidiary of the Company so as
to cause loss, damage or injury to the property, reputation or employees of
the Company or a Parent or Subsidiary of the Company, or (v) any other
misconduct by the Participant which is materially injurious to the financial
condition or business reputation of, or is otherwise materially injurious to,
the Company or a Parent or Subsidiary of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the committee appointed by the Board to administer
this Plan, or if no committee is appointed, the Board.
"Company" means Icast Corporation or any successor or acquiring
corporation.
"Disability" means a disability, whether temporary or permanent, partial
or total, as determined by the Committee.
"Exercise Price" means the price at which a holder of an Option may
purchase the Shares issuable upon exercise of the Option.
"Fair Market Value" means, as of any date, the value of a share of the
Company's Common Stock determined as follows:
8.
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(a) if such Common Stock is then quoted on the Nasdaq National
Market, its closing price on the Nasdaq National Market on
the date of determination as reported in The Wall Street
Journal;
(b) if such Common Stock is publicly traded and is then listed
on a national securities exchange, its closing price on
the date of determination on the principal national
securities exchange on if such Common Stock is publicly
traded but is not quoted on the Nasdaq National Market nor
listed or admitted to trading on a national securities
exchange, the average of the closing bid and asked prices
on the date of determination as reported by The Wall Street
Journal (or, if not so reported, as otherwise reported by
any newspaper or other source as the Board may determine);
or
(c) if none of the foregoing is applicable, by the Committee in
good faith.
"Option" means an award of an option to purchase Shares pursuant to
Section 5 hereof.
"Parent" means any corporation (other than the Company) in an unbroken
chain of corporations ending with the Company if each of such corporations
other than the Company owns stock possessing fifty percent (50%) or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.
"Participant" means a person who receives an Option under this Plan.
"Plan" means this Icast Corporation 1996 Stock Option Plan, as amended
from time to time. "SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means shares of the Company's Common Stock reserved for
issuance under this Plan, as adjusted pursuant to Sections 2 and 16 hereof,
and any successor security.
"Subsidiary" or "Subsidiaries" means any corporation or corporations
(other than the Company) in an unbroken chain of corporations beginning with
the Company if each of the corporations other than the last corporation in
the unbroken chain owns stock possessing fifty percent (50%) or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
"Termination" or "Terminated" means, for purposes of this Plan with
respect to a Participant, that the Participant has for any reason ceased to
provide services as an employee, officer, director or consultant to the
Company or a Parent or Subsidiary of the Company. A Participant will not be
deemed to have ceased to provide services in the case of (i) sick leave, (ii)
military leave, or (iii) any other leave of absence approved by the
Committee, provided that such leave is for a period of not more than ninety
(90) days, unless reinstatement (or, in the case of an employee with an ISO,
reemployment) upon the expiration of such leave is guaranteed by contract or
statute or unless provided otherwise pursuant to formal policy adopted from
time to time by the Company and issued and promulgated in writing. In the
case of any Participant on (i) sick leave, (ii) military leave or (iii) an
approved leave of absence, the Committee may make such provisions respecting
suspension of vesting of the Option while the Participant is on leave from
the Company or a Parent or Subsidiary of the Company as the Committee may
deem appropriate, except that in no event may an Option be exercised after
the expiration of the term set forth in the Stock Option Agreement. The
Committee will have sole discretion to determine whether a Participant has
ceased to provide services and the effective date on which the Participant
ceased to provide services (the "Termination Date").
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"Unvested Shares" means "Unvested Shares" as defined in Section 2.2 of
the Stock Option Agreement.
"Vested Shares" means "Vested Shares" as defined in Section 2.2 of the
Stock Option Agreement.
10.
