<PAGE>
As filed with the Securities and Exchange Commission on December 2, 1997
Registration No. 333-
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
--------------------
INTEGRATED MEASUREMENT SYSTEMS, INC.
(Exact name of registrant as specified in charter)
OREGON 93-0840631
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
------------
9525 S.W. GEMINI DRIVE, BEAVERTON, OREGON 97008
(Address, including zip code, of registrant's principal executive offices)
------------
INTEGRATED MEASUREMENT SYSTEMS, INC. 1995 STOCK INCENTIVE PLAN
(Full title of the Plan)
------------
KEITH L. BARNES
PRESIDENT AND CHIEF EXECUTIVE OFFICER
INTEGRATED MEASUREMENT SYSTEMS, INC.
9525 S.W. GEMINI DRIVE, BEAVERTON, OREGON 97008
(503) 626-7117
(Name, address, including zip code, and telephone number,
including area code, of Agent for Service)
------------
with copies to:
STEPHEN M. GOING, ESQ.
ATER WYNNE HEWITT DODSON & SKERRITT, LLP
222 S.W. COLUMBIA, SUITE 1800, PORTLAND, OREGON 97201
(503) 226-1191
CALCULATION OF REGISTRATION FEE
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Title of Amount Proposed Proposed Amount
Securities to be Maximum Maximum of
to be Registered Offering Aggregate Registration
Registered Price per Offering Fee
Share (1) Price (1)
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Common Stock,
par value $.01 370,000 $ 18.00 $6,660,000 $1,964.70
per share shares ------ --------- --------
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(1) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(h)(1), the aggregate offering price is based on the
average of high and low per shares sales prices of the Registrant's Common
Stock as reported on the Nasdaq National Market System on November 25,
1997.
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<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This registration statement is filed in accordance with the provisions of
General Instruction E to Form S-8 for the purpose of registering additional
shares of Common Stock for offer and sale under the Integrated Measurement
Systems, Inc. 1995 Stock Incentive Plan, for which a registration statement on
Form S-8 (File No. 333-13693) is already effective. Except to the extent that
exhibits are filed herewith, the contents of Integrated Measurement Systems,
Inc.'s registration statement on Form S-8 (File No. 333-13693) are hereby
incorporated by reference.
ITEM 8. EXHIBITS
NUMBER DESCRIPTION
5.0 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 Arthur Andersen LLP
24.0 Powers of Attorney (included in signature page in Part II of the
Registration Statement)
99.0 Integrated Measurement Systems, Inc. 1995 Stock Incentive Plan,
as amended
ITEM 9. 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,
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<PAGE>
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 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.
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<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 Beaverton, State of Oregon, on the 26th day of
November, 1997.
INTEGRATED MEASUREMENT SYSTEMS, INC.
By: /s/ Keith L. Barnes
---------------------------------------
Keith L. Barnes
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Keith L. Barnes and Sar Ramadan, 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 agents 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.
[SIGNATURES ON FOLLOWING PAGE]
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<PAGE>
SIGNATURE TITLE DATE
/s/ Keith L. Barnes
- ----------------------- President, Chief 11/26/97
Keith L. Barnes Executive Officer and
Director (Principal
Executive Officer)
/s/ Sar Ramadan
- ----------------------- Chief Financial Officer 11/26/97
Sar Ramadan (Principal Financial and
Accounting Officer)
/s/ H. Raymond Bingham
- ----------------------- Chairman of the Board 11/26/97
H. Raymond Bingham
/s/ C. Scott Gibson
- ----------------------- Director 11/26/97
C. Scott Gibson
/s/ James M. Hurd
- ----------------------- Director 11/26/97
James M. Hurd
/s/ James E. Solomon
- ----------------------- Director 11/26/97
James E. Solomon
/s/ Milton R. Smith
- ----------------------- Director 11/26/97
Milton R. Smith
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<PAGE>
INDEX TO EXHIBITS
EXHIBIT PAGE
NUMBER EXHIBIT NO.
5.0 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 Arthur Andersen LLP
24.0 Powers of Attorney (included in signature page in Part II of
the Registration Statement)
99.0 Integrated Measurement Systems, Inc. 1995 Stock Incentive
Plan, as amended
<PAGE>
EXHIBIT 5.0
ATER WYNNE HEWITT DODSON & SKERRITT, LLP
222 SW Columbia, Suite 1800
Portland, Oregon 97201
Phone (503) 226-1191
Fax (503) 226-0079
December 2, 1997
Board of Directors
Integrated Measurement Systems, Inc.
9525 SW Gemini Drive
Beaverton, Oregon 97008
Gentlemen:
In connection with the registration of 370,000 shares of common stock,
$0.01 par value per share (the "Shares"), of Integrated Measurement Systems,
Inc., an Oregon corporation (the "Company"), under the Registration Statement on
Form S-8 to be filed with the Securities and Exchange Commission on December 2,
1997, and the proposed offer and sale of the Common Stock pursuant to the terms
of the Company's 1995 Stock Incentive Plan (the "1995 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 to be offered pursuant to the 1995
Plan, when such Shares have been delivered against payment therefor as
contemplated by the 1995 Plan, will be validly issued, fully paid and
non-assessable.
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
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANT
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our reports dated January 24,
1997, included in Integrated Measurement Systems, Inc.'s Form 10-K for
the year ended December 31, 1996 and to all references to our firm included
in this registration statement.
Arthur Andersen LLP
Portland, Oregon
November 26, 1997
<PAGE>
EXHIBIT 99.0
INTEGRATED MEASUREMENT SYSTEMS, INC.
1995 STOCK INCENTIVE PLAN
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:
2.1 "ADMINISTRATOR" shall mean the Board or any of its Committees as
shall be administering the Plan, in accordance with Section 4.1 of the Plan.
2.2 "BOARD" shall mean the Board of Directors of the Company.
2.3 "CODE" shall mean the Internal Revenue Code of 1986, as amended.
2.4 "COMMITTEE" shall mean a Committee appointed by the Board in
accordance with Section 4.1 of the Plan.
2.5 "COMMON STOCK" shall mean the Common Stock of the Company.
2.6 "COMPANY" shall mean Integrated Measurement Systems, Inc, an
Oregon corporation.
2.7 "CONSULTANT" shall mean any person who is engaged by the Company
or any Parent or Subsidiary to render consulting services and is compensated for
such consulting services and any Director of the Company whether or not
compensated by the Company for their services as Directors.
<PAGE>
2.8 "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: (i) any sick leave, military leave, or
any other leave of absence approved by the Company; provided, however, that for
purposes of Incentive Stock Options, any 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, provided, further, that on the ninety-first day of such
leave (where re-employment is not guaranteed by contract or statute) the
Optionee's Incentive Stock Option shall automatically convert to a Nonqualified
Stock Option; or (ii) transfers between locations of the Company or between the
Company, its Parent, its Subsidiaries or its successor.
2.9 "DIRECTOR" shall mean a member of the Board.
2.10 "DISABILITY" shall mean total and permanent disability as defined
in Section 22(e)(3) of the Code.
2.11 "EMPLOYEE" shall mean any person, including Officers and
Directors, employed by the Company or any Parent or Subsidiary of the Company.
Neither the payment of a director's fee by the Company nor service as a Director
shall be sufficient to constitute "employment" by the Company.
2.12 "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
2.13 "INCENTIVE STOCK OPTION" shall mean an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.
2.14 "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.
2.15 "NOTICE OF GRANT" shall mean a written notice evidencing certain
terms and conditions of an individual Option grant. The Notice of Grant is part
of the Option Agreement.
2.16 "OFFICER" shall mean a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
2.17 "OPTION" shall mean a stock option granted pursuant to the Plan.
2.18 "OPTION AGREEMENT" shall mean a written agreement between the
Company and an Optionee evidencing the terms and conditions of an individual
Option grant. The Option Agreement is subject to the terms and conditions of
the Plan.
2.19 "OPTIONED STOCK" shall mean the Common Stock subject to an
Option.
2.20 "OPTIONEE" shall mean an Employee or Consultant who receives an
Option.
2.21 "PARENT" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
2.22 "PLAN" shall mean this 1995 Stock Incentive Plan.
<PAGE>
2.23 "RULE 16b-3" shall mean Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
2.24 "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 for consideration in the form of past or
future services.
2.25 "SHARE" shall mean a share of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.
2.26 "SUBSIDIARY" shall mean a "subsidiary corporation," whether now
or hereafter existing, as defined in Section 424(f) 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 1,620,000
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; provided, however, that Shares that
have actually been issued under the Plan shall not be returned to the Plan and
shall not become available for future distribution under the Plan.
4. ADMINISTRATION OF THE PLAN.
4.1 PROCEDURE.
4.1.1 MULTIPLE ADMINISTRATIVE BODIES. If permitted by Rule
16b-3, the Plan may be administered by different bodies with respect to
Directors, Officers who are not Directors, and Employees who are neither
Directors nor Officers.
4.1.2 ADMINISTRATION WITH RESPECT TO DIRECTORS AND OFFICERS
SUBJECT TO SECTION 16(b). With respect to Option grants made to Employees
who are also Officers or Directors subject to Section 16(b) of the Exchange
Act, the Plan shall be administered by (A) the Board, if the Board may
administer the Plan in compliance with the rules governing a plan intended
to qualify as a discretionary plan under Rule 16b-3, or (B) a Committee
designated by the Board to administer the Plan, which Committee shall be
constituted to comply with the rules, if any, governing a plan intended to
qualify as a discretionary plan under Rule 16b-3. Once appointed, such
Committee shall continue to serve in its designated capacity until
otherwise directed by the Board. From time to time the Board may increase
the size of the Committee and appoint additional members, remove members
(with or without cause) and substitute new members, fill vacancies (however
caused), and remove all members of the Committee and thereafter directly
administer the Plan, all to the extent permitted by the rules governing a
plan intended to qualify as a discretionary plan under Rule 16b-3. With
respect to persons subject to Section 16 of the Exchange Act, transactions
under the Plan are intended to comply with all applicable conditions of
Rule 16b-3. To the extent any provision of the Plan or action by the
Administrator fails to so comply, it shall
<PAGE>
be deemed null and void, to the extent permitted by law and deemed
advisable by the Administrator.
4.1.3 ADMINISTRATION WITH RESPECT TO OTHER PERSONS. With respect
to Option grants made to Employees or Consultants who are neither Directors
nor Officers of the Company, the Plan shall be administered by (a) the
Board or (b)a Committee designated by the Board, which Committee shall be
constituted to satisfy the legal requirements relating to the
administration of stock option plans under state corporate and securities
laws and the Code. Once appointed, such Committee shall serve in its
designated capacity until otherwise directed by the Board. The Board may
increase the size of the Committee and appoint additional members, remove
members (with or without cause) and substitute new members, fill vacancies
(however caused), and remove all members of the Committee and thereafter
directly administer the Plan, all to the extent permitted by the legal
requirements relating to the administration of stock option plans under
state corporate and securities laws and the Code.
4.2 POWERS OF THE ADMINISTRATOR. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:
4.2.1 to grant Incentive Stock Options in accordance with
Section 422 of the Code, or Nonqualified Stock Options;
4.2.2 to authorize Sales of Shares of Common Stock hereunder;
4.2.3 to determine, upon review of relevant information and in
accordance with Section 8.2 of the Plan, the fair market value of the
Common Stock;
4.2.4 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 8.1 of the Plan;
4.2.5 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;
4.2.6 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;
4.2.7 to interpret the Plan;
4.2.8 to prescribe, amend and rescind rules and regulations
relating to the Plan;
4.2.9 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;
4.2.10 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;
<PAGE>
4.2.11 to accelerate or defer (with the consent of the Optionee)
the exercise date of any Option;
4.2.12 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;
4.2.13 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;
4.2.14 to determine the restrictions on transfer, vesting
restrictions, repurchase rights, or other restrictions applicable to Shares
issued under the Plan;
4.2.15 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 consistent with the provisions
of Section 8 of this Plan as of the date of the new Option grant;
4.2.16 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;
4.2.17 to approve forms of agreement for use under the Plan;
4.2.18 to reduce the exercise price of any Option to the then
current fair market value if the fair market value of the Common Stock
covered by such Option shall have declined since the date the Option was
granted;
4.2.19 to determine whether and under what circumstances an
Option may be settled in cash under subsection 9.6 instead of Common Stock;
and
4.2.20 to make all other determinations deemed necessary or
advisable for the administration of the Plan.
4.3 EFFECT OF BOARD'S DECISION. All decisions, determinations and
interpretations of the Administrator 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.
5.1 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 or she is otherwise eligible, be granted an additional Option
or Options or Sold additional Shares.
<PAGE>
5.2 ISO LIMITATION. To the extent that the aggregate fair market
value: (i) of Shares subject to an Optionee's Incentive Stock Options granted by
the Company, any Parent or Subsidiary, which (ii) become exercisable for the
first time during any calendar year (under all plans of the Company or any
Parent or Subsidiary) exceeds $100,000, such excess Options shall be treated as
Nonqualified Stock Options. For purposes of this Section 5.2, Incentive Stock
Options shall be taken into account in the order in which they were granted, and
the fair market value of the Shares shall be determined as of the time of grant.
5.3 SECTION 5.2 LIMITATIONS. Section 5.2 of the Plan shall apply
only to an Incentive Stock Option evidenced by an Option Agreement which sets
forth the intention of the Company and the Optionee that such Option shall
qualify as an Incentive Stock Option. Section 5.2 of the Plan shall not apply
to any Option evidenced by a Option Agreement which sets forth the intention of
the Company and the Optionee that such Option shall be a Nonqualified Stock
Option.
5.4 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 or her
right or the Company's right to terminate his employment or consulting
relationship at any time, with or without cause.
5.5 OTHER LIMITATIONS. The following limitations shall apply to
grants of Options to Employees:
5.5.1 No Employee shall be granted, in any fiscal year of the
Company, Options to purchase more than 200,000 Shares.
5.5.2 In connection with his or her initial employment, an
Employee may be granted Options to purchase up to an additional 200,000
Shares which shall not count against the limit set forth in subsection
5.5.1 above.
5.5.3 The foregoing limitations shall be adjusted
proportionately in connection with any change in the Company's
capitalization as described in Section 11.
5.5.4 If an Option is canceled in the same fiscal year of the
Company in which it was granted (other than in connection with a
transaction described in Section 11), the canceled Option shall be counted
against the limits set forth in subsections 5.5.1 and 5.5.2 above). For
this purpose, if the exercise price of an Option is reduced, the
transaction will be treated as a cancellation of the Option and the grant
of a new Option.
6. TERM OF PLAN.
The Plan shall become effective upon the earlier to occur of its adoption
by the Board 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 Option shall be stated in the Notice of Grant; provided,
however, that in the case of an Incentive Stock Option, the term shall be ten
(10) years from the date of grant or such shorter
<PAGE>
term as may be provided in the Notice of Grant. However, in the case of an
Incentive Stock Option granted to an Optionee who, at the time the Incentive
Stock 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, the term of the Incentive Stock Option shall be five (5) years from
the date of grant thereof or such shorter term as may be provided in the Notice
of Grant.
8. EXERCISE/PURCHASE PRICE AND CONSIDERATION.
8.1 EXERCISE/PURCHASE PRICE. The per-Share exercise/purchase price
for the Shares to be issued pursuant to exercise of an Option or a Sale shall be
such price as is determined by the Administrator, but shall be subject to the
following:
8.1.1 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.
8.1.2 In the case of a Nonqualified Stock Option or Sale, the
per Share exercise/purchase price shall be determined by the Administrator.
8.1.3 Any determination to establish an Option exercise price or
effect a Sale of Common 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 Administrator specifying that the sale is in the best
interest of the Company, and specifying both the fair market value and the
Option exercise price or sale price of the Common Stock.
8.2 FAIR MARKET VALUE. The fair market value per Share shall be
determined by the Administrator 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 (or the closing bid if no sales
were reported) for the last market trading day prior to the date of grant of the
Option or authorization of Sale or other determination, 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 for the last market
trading day prior to the date of grant of the Option or authorization of Sale or
other determination, as reported in THE WALL STREET JOURNAL.
8.3 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 Administrator. In the case of an Incentive
Stock Option, the Administrator shall determine the acceptable form of
consideration at the time of grant. Such consideration may consist of:
<PAGE>
8.3.1 cash;
8.3.2 check;
8.3.3 transfer to the Company of Shares which
(a) in the case of Shares acquired upon exercise of an
Option, have been owned by the Optionee for more than six months on the date of
surrender, and
(b) have a fair market value on the date of surrender
equal to the aggregate exercise price of the Shares to be acquired;
8.3.4 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;
8.3.5 such other consideration and method of payment for the
issuance of Shares to the extent permitted by legal requirements relating
to the administration of stock option plans and issuances of capital stock
under state corporate and securities laws and the Code; or
8.3.6 any combination of the foregoing methods of payment.
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. Notwithstanding the
foregoing provisions of this Section 8.3, the consideration for Shares to be
issued pursuant to a Sale may not include, in whole or in part, the
consideration set forth in subsections (iii) and (iv) above.
9. EXERCISE OF OPTION.
9.1 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 Administrator, 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.
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 Administrator, consist of any
consideration and method of payment allowable under the Option Agreement and
Section 8.3 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 Administrator. 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,
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no right to vote or receive dividends or any other rights as a stockholder shall
exist with respect to the Optioned Stock represented by such stock certificate,
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.
9.2 TERMINATION OF EMPLOYMENT OR CONSULTING RELATIONSHIP. In the
event that an Optionee's Continuous Status as an Employee or Consultant
terminates (other than upon the Optionee's death or Disability) the Optionee may
exercise his or her Option, but only within such period of time as is determined
by the Administrator, and only to the extent that the Optionee was entitled to
exercise it at the date of termination (but in no event later than the
expiration of the term of such Option as set forth in the Notice of Grant). In
the case of an Incentive Stock Option, the Administrator shall determine such
period of time (in no event to exceed ninety (90) days from the date of
termination) when the Option is granted. If, at the date of termination, the
Optionee is not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
9.3 DISABILITY OF OPTIONEE. In the event that an Optionee's
Continuous Status as an Employee or Consultant terminates as a result of the
Optionee's Disability, the Optionee may exercise his or her Option at any time
within twelve (12) months from the date of such termination, but only to the
extent that the Optionee was entitled to exercise it at the date of such
termination (but in no event later than the expiration of the term of such
Option as set forth in the Notice of Grant). If, at the date of termination,
the Optionee is not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified herein, the Option shall terminate, and the Shares covered by
such Option shall revert to the Plan.
9.4 DEATH OF OPTIONEE. In the event of the death of an Optionee, the
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration of the term of such Option
as set forth in the Notice of Grant), 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 that the Optionee was entitled to exercise the Option at the
date of death. If, at the time of death, the Optionee was not entitled to
exercise his or her entire Option, the Shares covered by the unexercisable
portion of the Option shall revert to the Plan. If, after death, the Optionee's
estate or a person who acquired the right to exercise the Option by bequest or
inheritance does not exercise the Option within the time specified herein, the
Option shall terminate, and the Shares covered by such Option shall revert to
the Plan.
9.5 RULE 16b-3. Options granted to persons subject to Section 16(b)
of the Exchange Act must comply with Rule 16b-3 and shall contain such
additional conditions or restrictions as may be required thereunder to qualify
for the maximum exemption from Section 16 of the Exchange Act with respect to
Plan transactions.
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9.6 BUYOUT PROVISIONS. The Administrator may at any time offer to
buy out for a payment in cash or Shares, an Option previously granted, based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.
10. NONTRANSFERABILITY OF OPTIONS.
Except as otherwise specifically provided in the Option Agreement, 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.
11.1 CHANGES IN CAPITALIZATION: 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
Administrator, 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.
11.2 DISSOLUTION OR LIQUIDATION. In the event of the proposed dissolution
or liquidation of the Company, each outstanding Option will terminate
immediately prior to the consummation of such proposed action, unless otherwise
provided by the Administrator. The Administrator 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 or
her Option as to all or any part of the Optioned Stock, including Shares as to
which the Option would not otherwise be exercisable.
11.3 MERGER OR ASSET SALE. 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, each outstanding 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 Administrator
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 Administrator makes an Option
fully exercisable in lieu of assumption or substitution in the event of a merger
or sale of assets, the Administrator 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 Administrator may specify in the
notice, and the Option will terminate upon the expiration of such period. For
the purposes of this paragraph, the Option shall be considered assumed if,
following the merger or sale of assets, the Option confers the right to
purchase, for each Share of
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Optioned Stock subject to the Option immediately prior to the merger or sale of
assets, the consideration (whether stock, cash, or other securities or property)
received in the merger or sale of assets by holders of Common Stock for each
Share held on the effective date of the transaction (and if holders were offered
a choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding Shares); provided, however, that if such
consideration received in the merger or sale of assets was not solely common
stock of the successor corporation or its Parent, the Administrator may, with
the consent of the successor corporation and the Optionee, provide for the
consideration to be received upon the exercise of the Option, for each Share of
Optioned Stock subject to the Option, to be solely common stock of the successor
corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.
12. TIME OF GRANTING OPTIONS.
The date of grant of an Option shall, for all purposes, be the date on
which the Administrator makes the determination granting such Option. Notice of
the determination shall be given to each Optionee within a reasonable time after
the date of such grant.
13. AMENDMENT AND TERMINATION OF THE PLAN.
13.1 AMENDMENT AND TERMINATION. The Board may amend or terminate the
Plan from time to time in such respects as the Board may deem advisable.
13.2 STOCKHOLDER APPROVAL. The Company shall obtain stockholder approval
of any Plan amendment to the extent necessary and desirable to comply with Rule
16b-3 or with Section 422 of the Code (or any successor rule or statute or other
applicable law, rule or regulation, including the requirements of any exchange
or quotation system on which the Common Stock is listed or quoted). Such
stockholder approval, if required, shall be obtained in such a manner and to
such a degree as is required by the applicable law, rule or regulation.
13.3 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 Administrator, 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.
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.
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16. LIABILITY OF COMPANY.
16.1 INABILITY TO OBTAIN AUTHORITY. 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.
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.
16.2 GRANTS EXCEEDING ALLOTTED SHARES. If the Optioned Stock covered by
an Option exceeds, as of the date of grant, the number of Shares which may be
issued under the Plan without additional stockholder approval, such Option shall
be void with respect to such excess Optioned Stock, unless stockholder approval
of an amendment sufficiently increasing the number of Shares subject to the Plan
is timely obtained in accordance with Section 13 of the Plan.
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.
Such stockholder approval shall be obtained in the manner and to the degree
required under applicable federal and state law.
