<PAGE>
As filed with the Securities and Exchange Commission on February , 1998
Registration No. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
________________________
METRO ONE TELECOMMUNICATIONS, INC.
(Exact name of registrant as specified in charter)
OREGON 93-0995165
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
________________________
8405 S.W. NIMBUS AVENUE
BEAVERTON, OREGON 97008
(503) 643-9500
(Address, including zip code and telephone number,
including area code, of registrant's principal executive offices)
________________________
METRO ONE TELECOMMUNICATIONS, INC.
1994 STOCK INCENTIVE PLAN
(Full Title of the Plan)
________________________
TIMOTHY A. TIMMINS
PRESIDENT AND CHIEF EXECUTIVE OFFICER
METRO ONE TELECOMMUNICATIONS, INC.
8405 S.W. NIMBUS AVENUE
BEAVERTON, OREGON 97008
(503) 643-9500
(Name, address, including zip code and telephone number,
including area code, of agent for service)
________________________
with copies to:
BYRON W. MILSTEAD, ESQ.
ATER WYNNE HEWITT DODSON & SKERRITT, LLP
222 S.W. COLUMBIA, SUITE 1800, PORTLAND, OREGON 97201
(503) 226-1191
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Title of Amount to Proposed Maximum Proposed Maximum Amount of
Securities to be Offering Price Aggregate Registration
be Registered Registered per Share (1) Offering Price (1) Fee
- -----------------------------------------------------------------------------------
Common Stock, 471,500
no par value shares $9.0625 $3,830,938 $1,294.84
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</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(h) the aggregate offering price is based on the
exercise prices of outstanding options and the average of the high and low
per share sales prices reported for the Common Stock on January 23, 1998,
for options not yet granted.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This registration statement is filed in accordance with the provisions
of General Jurisdiction E to Form S-8 for the purpose of registering
additional shares of common stock for offer and sale under the Metro One
Telecommunications, Inc. 1994 Stock Incentive Plan, for which a registration
statement on Form S-8 (File No. 333-20387) is already effective. Except to
the extent that exhibits are filed herewith, the contents of Metro One
Telecommunications, Inc.'s registration statement on Form S-8 (File No.
333-20387) are hereby incorporated by reference.
ITEM 3. EXHIBITS
Number Description
------ -----------
5.1 Opinion of Ater Wynne Hewitt Dodson & Skerritt, LLP as to the
legality of the securities being registered
23.1 Consent of Ater Wynne Hewitt Dodson & Skerritt, LLP (included in
legal opinion filed as Exhibit 5.0)
23.2 Consent of Deloitte & Touche, LLP
24.1 Powers of Attorney (included in signature page in Part II of the
Registration Statement)
99.1 Metro One Telecommunications, Inc. 1994 Stock Incentive Plan, as
amended
ITEM 4. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes to file, during
any period in which offers or sales are being made, a post-effective
amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement;
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement;
provided, however, that subparagraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by those
subparagraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement.
(b) The undersigned registrant hereby undertakes that, for the
purpose of determining liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) The undersigned registrant hereby undertakes to remove from
registration by means
-2-
<PAGE>
of a post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(d) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(e) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such a director, officer or controlling person in
connection with securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
-3-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Portland, State of Oregon, on the
23rd day of January, 1998.
METRO ONE TELECOMMUNICATIONS, INC.
By: /s/ Timothy A. Timmins
----------------------------------
Timothy A. Timmins
President and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Timothy A. Timmins and Stebbins B. Chandor,
Jr., and each of them singly, as true and lawful attorneys-in-fact and agents
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities to sign the registration statement
filed herewith and any or all amendments to said registration statement
(including post-effective amendments), and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission granting unto said attorneys-in-fact and
agents and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
foregoing, as fully to all intents and purposes as he or she might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agent or any of them, or their or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Witness our hands on the date set forth below.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Timothy A. Timmins President, Chief Executive Officer 01/23/98
- ----------------------------- and Director (Principal Executive
Timothy A. Timmins Officer)
/s/ Stebbins B. Chandor, Jr. Senior Vice President and Chief 01/23/98
- ----------------------------- Financial Officer (Principal
Stebbins B. Chandor, Jr. Financial Officer)
-4-
<PAGE>
/s/ Karen L. Johnson Vice President and Controller 01/23/98
- ----------------------------- (Principal Accounting Officer)
Karen L. Johnson
/s/ A. Jean de Grandpre Director 01/23/98
- -----------------------------
A. Jean de Grandpre
/s/ G. Raymond Doucet Director 01/23/98
- -----------------------------
G. Raymond Doucet
/s/ William D. Rutherford Director 01/23/98
- -----------------------------
William D. Rutherford
/s/ James M. Usdan Director 01/23/98
- -----------------------------
James M. Usdan
-5-
<PAGE>
INDEX TO EXHIBITS
Exhibit Page
Number Exhibit No.
------- ------- -----
5.1 Opinion of Ater Wynne Hewitt Dodson & Skerritt as to the
legality of the securities being registered
23.1 Consent of Ater Wynne Hewitt Dodson & Skerritt (included in
legal opinion filed as Exhibit 5.0)
23.2 Consent of Deloitte & Touche, LLP
24.1 Powers of Attorney (included in signature page in Part II
of the Registration Statement)
99.1 Metro One Telecommunications, Inc. 1994 Stock Incentive Plan,
as amended
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<PAGE>
ATER WYNNE HEWITT DODSON & SKERRITT, LLP
LETTERHEAD
EXHIBIT 5.0
February 4, 1998
Board of Directors
Metro One Telecommunications, Inc.
8405 S.W. Nimbus Avenue
Beaverton, OR 97008
Gentlemen:
In connection with the registration of 471,500 shares of common stock,
no par value (the "Common Stock"), of Metro One Telecommunications, Inc., an
Oregon corporation (the "Company"), under the Registration Statement on Form
S-8 to be filed with the Securities and Exchange Commission on February 5,
1998, and the proposed offer and sale of the Common Stock pursuant to the
terms of the Company's 1994 Stock Incentive Plan (the "1994 Plan"), we have
examined such corporate records, certificates of public officials and
officers of the Company and other documents as we have considered necessary
or proper for the purpose of this opinion.
Based on the foregoing and having regard to legal issues which we deem
relevant, it is our opinion that the shares of Common Stock to be offered
pursuant to the 1994 Plan, when such shares have been delivered against
payment therefor as contemplated by the 1994 Plan, will be validly issued,
fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
above-mentioned registration statement.
Very truly yours,
/s/ Ater Wynne Hewitt Dodson & Skerritt, LLP
ATER WYNNE HEWITT DODSON & SKERRITT, LLP
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of Metro One Telecommunications, Inc. on Form S-8 of our report dated
February 26, 1997, appearing in the Annual Report on Form 10-KSB of Metro One
Telecommunications, Inc. for the year ended December 31, 1996.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Portland, Oregon
January 28, 1998
<PAGE>
METRO ONE TELECOMMUNICATIONS, INC.
1994 STOCK INCENTIVE PLAN
DATED JULY 28, 1995
AS AMENDED DECEMBER 18, 1996 AND MAY 8, 1997
1. PURPOSES OF THE PLAN. The purposes of this Stock Incentive Plan
are to attract and retain the best available personnel for positions of
substantial responsibility, to provide additional incentive to the Employees
and Consultants of the Company and to promote the success of the Company's
business.
Options granted hereunder may be either "incentive stock options," as
defined in Section 422 of the Internal Revenue Code of 1986, as amended, or
"nonqualified stock options," at the discretion of the Board and as reflected
in the terms of the written option agreement. In addition, shares of the
Company's Common Stock may be Sold hereunder independent of any Option grant.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "BOARD" shall mean the Committee, if one has been appointed,
or the Board of Directors of the Company, if no Committee is appointed.
(b) "CODE" shall mean the Internal Revenue Code of 1986, as
amended.
(c) "COMMON STOCK" shall mean the Common Stock of the Company.
(d) "COMPANY" shall mean Metro One Telecommunications, Inc., an
Oregon corporation.
(e) "COMMITTEE" shall mean the Committee appointed by the Board of
Directors in accordance with Section 4.(a) of the Plan, if one is appointed.
(f) "CONSULTANT" shall mean any person who is engaged by the
Company or any Subsidiary to render consulting services and is compensated
for such consulting services and any director of the Company whether
compensated for such services or not.
(g) "CONTINUOUS STATUS AS AN EMPLOYEE OR CONSULTANT" shall mean
the absence of any interruption or termination of service as an Employee or
Consultant. Continuous Status as an Employee or Consultant shall not be
considered interrupted in the case of sick leave, military leave, or any
other leave of absence approved by the Board; provided that such leave is for
a period of not more than ninety days or reemployment upon the expiration of
such leave is guaranteed by contract or statute.
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(h) "EMPLOYEE" shall mean any person, including officers and
directors, employed by the Company or any Parent or Subsidiary of the
Company. The payment of a director's fee by the Company shall not be
sufficient to constitute "employment" by the Company.
(i) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended.
(j) "INCENTIVE STOCK OPTION" shall mean an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.
(k) "NONQUALIFIED STOCK OPTION" shall mean an Option not intended
to qualify as an incentive stock option within the meaning of Section 422 of
the Code.
(l) "OPTION" shall mean a stock option granted pursuant to the
Plan.
(m) "OPTIONED STOCK" shall mean the Common Stock subject to an
Option.
(n) "OPTIONEE" shall mean an Employee or Consultant who receives
an Option.
(o) "PARENT" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 424 of the Code.
(p) "PLAN" shall mean this 1994 Stock Incentive Plan.
(q) "SALE" or "SOLD" shall include, with respect to the sale of
Shares under the Plan, the sale of Shares for consideration in the form of
cash or notes, as well as a grant of Shares without consideration, except
past or future services.
(r) "SHARE" shall mean a share of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.
(s) "SUBSIDIARY" shall mean a "subsidiary corporation," whether
now or hereafter existing, as defined in Section 424 of the Code.
3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 11
of the Plan, the maximum aggregate number of Shares which may be optioned
and/or Sold under the Plan is 1,900,000 shares of Common Stock. The Shares
may be authorized, but unissued, or reacquired Common Stock.
If an Option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were
subject thereto shall, unless the Plan shall have been terminated, become
available for future Option grants and/or Sales under the Plan.
2
<PAGE>
4. ADMINISTRATION OF THE PLAN.
(a) PROCEDURE. The Plan shall be administered by the Board of
Directors of the Company.
The Board of Directors may appoint a Committee consisting of not less
than two (2) members of the Board of Directors to administer the Plan on
behalf of the Board of Directors, subject to such terms and conditions as the
Board of Directors may prescribe. Once appointed, the Committee shall
continue to serve until otherwise directed by the Board of Directors. From
time to time the Board of Directors may increase the size of the Committee
and appoint additional members thereof, remove members (with or without
cause) and appoint new members in substitution therefor, fill vacancies
however caused, or remove all members of the Committee and thereafter
directly administer the Plan.
Members of the Board who are either eligible for Options and/or Sales or
have been granted Options or Sold Shares may vote on any matters affecting
the administration of the Plan or the grant of any Options or Sale of any
Shares pursuant to the Plan, except that no such member shall act upon the
granting of an Option or Sale of Shares to himself, but any such member may
be counted in determining the existence of a quorum at any meeting of the
Board during which action is taken with respect to the granting of Options or
Sale of Shares to him.
(b) POWERS OF THE BOARD. Subject to the provisions of the Plan,
the Board shall have the authority, in its discretion: (i) to grant
Incentive Stock Options in accordance with Section 422 of the Code, or
Nonqualified Stock Options; (ii) to authorize Sales of Shares of Common Stock
hereunder; (iii) to determine, upon review of relevant information and in
accordance with Sec tion 8.(b) of the Plan, the fair market value of the
Common Stock; (iv) to determine the exercise/purchase price per Share of
Options to be granted or Shares to be Sold, which exercise/purchase price
shall be determined in accordance with Section 8.(a) of the Plan; (v) to
determine the Employees or Consultants to whom, and the time or times at
which, Options shall be granted and the number of Shares to be represented by
each Option; (vi) to determine the Employees or Consultants to whom, and the
time or times at which, Shares shall be Sold and the number of Shares to be
Sold; (vii) to interpret the Plan; (viii) to prescribe, amend and rescind
rules and regulations relating to the Plan; (ix) to determine the terms and
provisions of each Option granted (which need not be identical) and, with the
consent of the holder thereof, modify or amend each Option; (x) to determine
the terms and provisions of each Sale of Shares (which need not be identical)
and, with the consent of the purchaser thereof, modify or amend each Sale;
(xi) to accelerate or defer (with the consent of the Optionee) the exercise
date of any Option; (xii) to accelerate or defer (with the consent of the
Optionee or purchaser of Shares) the vesting restrictions applicable to
Shares Sold under the Plan or pursuant to Options granted under the Plan;
(xiii) to authorize any person to execute on behalf of the Company any
instrument required to effectuate the grant of an Option or Sale of Shares
previously granted or authorized by the Board; (xiv) to determine the
restrictions on transfer, vesting restrictions, repurchase rights, or other
restrictions applicable to Shares issued under the Plan; (xv) to effect, at
any time and from time to time, with the consent of the affected Optionees,
the cancellation of any or all outstanding Options under the Plan and to
grant in substitution therefor new Options under the Plan covering the same
or different numbers of Shares, but having an Option price per Share
3
<PAGE>
consistent with the provisions of Section 8 of this Plan as of the date of
the new Option grant; (xvi) to establish, on a case-by-case basis, different
terms and conditions pertaining to exercise or vesting rights upon
termination of employment, whether at the time of an Option grant or Sale of
Shares, or thereafter; and (xvii) to make all other determinations deemed
necessary or advisable for the administration of the Plan.
(c) EFFECT OF BOARD'S DECISION. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees and
any other holders of any Options granted under the Plan or Shares Sold under
the Plan.
5. ELIGIBILITY.
(a) PERSONS ELIGIBLE. Options may be granted and/or Shares Sold
only to Employees and Consultants. Incentive Stock Options may be granted
only to Employees. An Employee or Consultant who has been granted an Option
or Sold Shares may, if he is otherwise eligible, be granted an additional
Option or Options or Sold additional Shares.
(b) ISO LIMITATION. No Incentive Stock Option may be granted to
an Employee which, when aggregated with all other Incentive Stock Options
granted to such Employee by the Company or any Parent or Subsidiary, would
result in Shares having an aggregate fair market value (determined for each
Share as of the date of grant of the Option covering such Share) in excess of
$100,000 becoming first available for purchase upon exercise of one or more
Incentive Stock Options during any calendar year.
(c) SECTION 5.(b) LIMITATIONS. Section 5.(b) of the Plan shall
apply only to an Incentive Stock Option evidenced by an "Incentive Stock
Option Agreement" which sets forth the intention of the Company and the
Optionee that such Option shall qualify as an Incentive Stock Option.
Section 5.(b) of the Plan shall not apply to any Option evidenced by a
"Nonqualified Stock Option Agreement" which sets forth the intention of the
Company and the Optionee that such Option shall be a Nonqualified Stock
Option.
(d) NO RIGHT TO CONTINUED EMPLOYMENT. The Plan shall not confer
upon any Optionee any right with respect to continuation of employment or
consulting relationship with the Company, nor shall it interfere in any way
with his right or the Company's right to terminate his employment or
consulting relationship at any time.
6. TERM OF PLAN. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
stockholders of the Company as described in Section 17 of the Plan. It shall
continue in effect for a term of ten (10) years, unless sooner terminated
under Section 13 of the Plan.
7. TERM OF OPTION. The term of each Incentive Stock Option shall be
ten (10) years from the date of grant thereof or such shorter term as may be
provided in the Stock Option Agreement. The term of each Nonqualified Stock
Option shall be ten (10) years and one (1) day from the date of grant thereof
or such other term as may be provided in the Stock Option Agreement.
However, in the case of an Option granted to an Optionee who, at the time the
4
<PAGE>
Option is granted, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or any Parent or
Subsidiary, (a) if the Option is an Incentive Stock Option, the term of the
Option shall be five (5) years from the date of grant thereof or such shorter
time as may be provided in the Stock Option Agreement, or (b) if the Option
is a Nonqualified Stock Option, the term of the Option shall be five (5)
years and one (1) day from the date of grant thereof or such other term as
may be provided in the Stock Option Agreement.
8. EXERCISE/PURCHASE PRICE AND CONSIDERATION.
(a) EXERCISE/PURCHASE PRICE. The per-Share exercise/purchase
price for the Shares to be issued pursuant to exercise of an Option or a Sale
(other than a Sale which is a grant for which no purchase price is payable)
shall be such price as is determined by the Board, but shall be subject to
the following:
(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the time of the grant
of such Incentive Stock Option, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price shall be no less than one
hundred ten percent (110%) of the fair market value per Share on the date of
the grant.
(B) granted to any other Employee, the per Share
exercise price shall be no less than one hundred percent (100%) of the fair
market value per Share on the date of grant.
(ii) In the case of a Nonqualified Stock Option or Sale
(A) granted or Sold to a person who, at the time of the
grant of such Option or authorization of such Sale, owns stock representing
more than ten percent (10%) of the voting power of all classes of stock of
the Company or any Parent or Subsidiary, the per Share exercise/purchase
price shall be no less than one hundred ten percent (110%) of the fair market
value per Share on the date of the grant or authorization of Sale, unless
otherwise expressly determined by the Board of Directors.
(B) granted or Sold to any other person, the per Share
exercise/purchase price shall be no less than eighty-five percent (85%) of
the fair market value per Share on the date of grant or authorization of
Sale, unless otherwise expressly determined by the Board of Directors.
(C) Any determination to sell stock at less than fair
market value on the date of the grant or authorization of Sale shall be
accompanied by an express finding by the Board of Directors specifying that
the sale is in the best interest of the Company, and specifying both the fair
market value and the grant or sale price of the stock.
5
<PAGE>
(iii) In the case of an Option granted or Sale authorized
on or after the effective date of registration of any class of equity
security of the Company pursuant to Section 12 of the Exchange Act and prior
to six (6) months after the termination of such registration, the per Share
exercise/purchase price shall be no less than one hundred percent (100%) of
the fair market value per Share on the date of grant or authorization of Sale.
(b) FAIR MARKET VALUE. The fair market value per Share shall be
determined by the Board in its discretion; provided, however, that where
there is a public market for the Common Stock, the fair market value per
Share shall be the closing price of the Common Stock for the date of grant or
authorization of Sale, as reported in THE WALL STREET JOURNAL (or, if not so
reported, as otherwise reported by the National Association of Securities
Dealers Automated Quotation (NASDAQ) System) or, in the event the Common
Stock is listed on a stock exchange, the fair market value per Share shall be
the closing price on such exchange on the date of grant of the Option or
authorization of Sale, as reported in THE WALL STREET JOURNAL.
(c) CONSIDERATION. The consideration to be paid for the Shares to
be issued upon exercise of an Option or pursuant to a Sale, including the
method of payment, shall be determined by the Board and may consist in whole
or part of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) transfer to the Company of Shares having a Fair Market Value at the
time of such exercise equal to the Option exercise price; or
(v) delivery of instructions to the Company to withhold from the Shares
that would otherwise be issued on the exercise that number of Shares having a
Fair Market Value at the time of such exercise equal to the Option exercise
price.
If the Fair Market Value of the number of whole Shares transferred or
the number of whole Shares surrendered is less than the total exercise price
of the Option, the shortfall must be made up in cash or by check.
9. EXERCISE OF OPTION.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A STOCKHOLDER. Any Option
granted hereunder shall be exercisable at such times and under such
conditions as determined by the Board, including performance criteria with
respect to the Company and/or the Optionee, and as shall be permissible under
the terms of the Plan.
An Option may not be exercised for a fraction of a Share.
6
<PAGE>
An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Company in accordance with the terms of
the Option by the person entitled to exercise the Option and full payment for
the Shares with respect to which the Option is exercised has been received by
the Company. Full payment may, as authorized by the Board, consist of any
consideration and method of payment allowable under Section 8.(c) of the
Plan. Each Optionee who exercises an Option shall, upon notification of the
amount due (if any) and prior to or concurrent with delivery of the
certificate representing the Shares, pay to the Company amounts necessary to
satisfy applicable federal, state and local tax withholding requirements. An
Optionee must also provide a duly executed copy of any stock transfer
agreement then in effect and determined to be applicable by the Board. Until
the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or
any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 11 of the
Plan.
Exercise of an Option in any manner shall result in a decrease in
the number of Shares which thereafter may be available, both for purposes of
the Plan and for sale under the Option, by the number of Shares as to which
the Option is exercised.
(b) TERMINATION OF STATUS AS AN EMPLOYEE OR CONSULTANT. If an
Employee or Consultant ceases to serve as an Employee or Consultant (as the
case may be), he may, but only within three (3) months (or such other period
of time not exceeding the limitations of Section 7 above as is determined by
the Board at the time of grant of an Option or thereafter) after the date he
ceases to be an Employee or Consultant (as the case may be) of the Company,
exercise his Option to the extent that he was entitled to exercise it at the
date of such termination. To the extent that he was not entitled to exercise
the Option at the date of such termination, or if he does not exercise such
Option (which he was entitled to exercise) within the time specified herein,
the Option shall terminate.
(c) DISABILITY OF OPTIONEE. Notwithstanding the provisions of
Section 9.(b) above, in the event an Employee or Consultant is unable to
continue his employment or consulting relationship (as the case may be) with
the Company as a result of his total and permanent disability (as defined in
Section 22(e)(3) of the Code), he may, but only within twelve (12) months (or
such other period of time not exceeding the limitations of Section 7 above as
is determined by the Board at the time of grant of an Option or thereafter)
from the date of termination, exercise his Option to the extent he was
entitled to exercise it at the date of such termination. To the extent that
he was not entitled to exercise the Option at the date of termination, or if
he does not exercise such Option (which he was entitled to exercise) within
the time specified herein, the Option shall terminate.
(d) DEATH OF OPTIONEE. In the event of the death of an Optionee
dur ing the term of the Option who is at the time of his death an Employee or
Consultant of the Company and who shall have been in Continuous Status as an
Employee or Consultant since the date of grant of the Option, the Option may
be exercised, at any time within twelve (12) months (or such
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other period of time not exceeding the limitations of Section 7 above as is
determined by the Board at the time of grant of an Option or thereafter)
following the date of death, by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only
to the extent of the right to exercise as of the date of death.
10. NONTRANSFERABILITY OF OPTIONS. An Option may not be sold, pledged,
assigned, hypothecated, transferred or disposed of in any manner other than
by will, or by the laws of descent and distribution, and may be exercised
during the lifetime of the Optionee only by the Optionee or, if
incapacitated, by his or her legal guardian or legal representative.
11. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER. Subject to
any required action by the stockholders of the Company, the number of shares
of Common Stock covered by each outstanding Option and the number of shares
of Common Stock which have been authorized for issuance under the Plan but as
to which no Options have yet been granted or Sales made or which have been
returned to the Plan upon cancellation or expiration of an Option, as well as
the price per share of Common Stock covered by each such outstanding Option,
shall be proportionately adjusted for any increase or decrease in the number
of issued shares of Common Stock resulting from a stock split, reverse stock
split, stock dividend, combination or reclassification of the Common Stock,
or any other increase or decrease in the number of issued shares of Common
Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall
not be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein,
no issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or
price of shares of Common Stock subject to an Option.
In the event of the proposed dissolution or liquidation of the Company,
the Option will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board. The Board may, in
the exercise of its sole discretion in such instances, declare that any
Option shall terminate as of a date fixed by the Board and give each Optionee
the right to exercise his Option as to all or any part of the Optioned Stock,
including Shares as to which the Option would not otherwise be exercisable.
In the event of a proposed sale of all or substantially all of the assets of
the Company, or the merger of the Company with or into another corporation,
the Option shall be assumed or an equivalent option shall be substituted by
such successor corporation or a parent or subsidiary of such successor
corporation, unless the Board determines, in the exercise of its sole
discretion and in lieu of such assumption or substitution, that the Optionee
shall have the right to exercise the Option as to all of the Optioned Stock,
including Shares as to which the Option would not otherwise be exercisable.
If the Board makes an Option fully exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Board shall
notify the Optionee that the Option shall be fully exercisable for a period
of thirty (30) days from the date of such notice or such shorter period as
the Board may specify in the notice, and the Option will terminate upon the
expiration of such period.
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12. TIME OF GRANTING OPTIONS. The date of grant of an Option shall,
for all purposes, be the date on which the Board makes the determination
granting such Option. Notice of the determination shall be given to each
Employee or Consultant to whom an Option is so granted within a reasonable
time after the date of such grant.
13. AMENDMENT AND TERMINATION OF THE PLAN.
(a) AMENDMENT AND TERMINATION. The Board may amend or terminate
the Plan from time to time in such respects as the Board may deem advisable;
provided, however, that if required to qualify the Plan under Rule 16b-3
promulgated under Section 16 of the Securities Exchange Act of 1934, as
amended, no amendment shall be made more than once every six months that
would change the amount, price or timing of the option grants, other than to
comport with changes in the Internal Revenue Code of 1986, as amended, or the
rules and regulations promulgated thereunder; and provided, further, that, if
required to qualify the Plan under Rule 16b-3, no amendment shall be made
without the approval of the stockholders of the Company in the manner
described in Section 17 of the Plan if the amendment would:
(i) increase the number of Shares subject to the Plan,
other than in connection with an adjustment under Section 11 of the Plan;
(ii) make a change in the designation of the class of
Employees or Consultants eligible to be granted Options; or
(iii) if the Company has a class of equity security
registered under Section 12 of the Exchange Act at the time of such revision
or amendment, cause any material increase in the benefits accruing to
participants under the Plan.
(b) STOCKHOLDER APPROVAL. If any amendment requiring stockholder
approval under Section 13.(a) of the Plan is made subsequent to the first
registration of any class of equity security by the Company under Section 12
of the Exchange Act, such stockholder approval shall be solicited as
described in Section 17 of the Plan.
(c) EFFECT OF AMENDMENT OR TERMINATION. Any such amendment or
termination of the Plan shall not affect Options already granted, and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee
and the Board, which agreement must be in writing and signed by the Optionee
and the Company.
14. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued
pursuant to the exercise of an Option or a Sale unless the exercise of such
Option or consummation of the Sale and the issuance and delivery of such
Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended,
applicable state securities laws, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange (including
NASDAQ) upon which the Shares may then be listed, and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
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As a condition to the exercise of an Option or a Sale, the Company may
require the person exercising such Option or to whom Shares are being Sold to
represent and warrant at the time of any such exercise or Sale that the
Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for
the Company, such a representation is required by any of the aforementioned
relevant provisions of law.
15. RESERVATION OF SHARES. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall
be sufficient to satisfy the requirements of the Plan.
Inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been
obtained.
16. OPTION AGREEMENT. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
17. STOCKHOLDER APPROVAL. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve months before or
after the date the Plan is adopted. If such stockholder approval is obtained
at a duly held stockholders' meeting, it may be obtained by the affirmative
vote of the holders of a majority of the outstanding shares of the Company,
such holders being present or represented and entitled to vote thereon. If
and in the event that the Company registers any class of any equity security
pursuant to Section 12 of the Exchange Act, the approval of such stockholders
of the Company shall be:
(a) SOLICITATION.
(i) solicited substantially in accordance with Section 14(a)
of the Exchange Act and the rules and regulations promulgated thereunder, or
(ii) solicited after the Company has furnished in writing to
the holders entitled to vote substantially the same information concerning
the Plan as that which would be required by the rules and regulations in
effect under Section 14(a) of the Exchange Act at the time such information
is furnished; and
(b) TIME. Obtained at or prior to the first annual meeting of
stockholders held subsequent to the first registration of any class of equity
securities of the Company under Section 12 of the Exchange Act.
If such stockholder approval is obtained by written consent, it
must be obtained by the written consent of stockholders of the Company in
compliance with the requirements of applicable state law.
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18. SIX MONTH HOLDING PERIOD FOR AFFILIATES. If the Company registers
any class of any equity security pursuant to Section 12 of the Exchange Act,
then from the effective date of such registration until six (6) months after
the termination of such registration (the Public Period), these limits will
apply to each officer, director and beneficial owner of ten percent (10%) or
more of any class of equity securities of the Company (Affiliates.) During
the Public Period, any Affiliate shall hold Shares Sold hereunder at least
six months from the date of Sale. During the Public Period, at least six
months must elapse from the date of grant of an Option to an Affiliate to the
date the Affiliate disposes of the Shares acquired upon exercise of the
Option, or (if the Option is disposed of other than by exercise) to the date
of disposition of the Option itself.
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