Nonemployee Directors Stock Option Plan - Identix Corp.
IDENTIX INCORPORATED
NONEMPLOYEE DIRECTORS STOCK OPTION PLAN
1. Purpose.
The purpose of this Plan is to offer Nonemployee Directors of
Identix Incorporated an opportunity to acquire a proprietary interest in the
success of the Company, or to increase such interest, by purchasing shares of
the Company's Common Stock. This Plan provides for the grant of Options to
purchase Shares. Options granted hereunder shall be "Nonstatutory Options," and
shall not include "incentive stock options" intended to qualify for treatment
under Sections 421 and 422 of the Internal Revenue Code of 1986, as amended.
2. Definitions.
As used herein, the following definitions shall apply:
(a) "Administrator" shall mean the entity, either the Board or
the committee of the Board, responsible for administering this Plan, as provided
in Section 3.
(b) "Affiliate" means a parent or subsidiary corporation as
defined in the applicable provisions (currently, Sections 424(e) and (f),
respectively) of the Code.
(c) "Board" shall mean the Board of Directors of the Company, as
constituted from time to time.
(d) "Change in Control" shall mean the occurrence of any one of
the following:
(i) any "person", as such term is used in Sections 13(d)
and 14(d) of the Exchange Act (other than the Company, an Affiliate, or a
Company employee benefit plan, including any trustee of such plan acting as
trustee) is or becomes the "beneficial owner" (as defined in Rule 13d 3 under
the Exchange Act), directly or indirectly, of securities of the Company
representing 20% or more of the combined voting power of the Company's then
outstanding securities;
(ii) the solicitation of proxies (within the meaning of
Rule 14a 1(k) under the Exchange Act and any successor rule) with respect to the
election of any director of the Company where such solicitation is for any
candidate who is not a
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candidate proposed by a majority of the Board in office prior to the time of
such election; or
(iii) the dissolution or liquidation (partial or total)
of the Company or a sale of assets involving 30% or more of the assets of the
Company, or any merger or reorganization of the Company, whether or not another
entity is the survivor, or other transaction pursuant to which the holders, as a
group, of all of the shares of the Company outstanding prior to the transaction
hold, as a group, less than 70% of the shares of the Company outstanding after
the transaction.
(e) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and any successor statute.
(f) "Company" shall mean Identix Incorporated, a Delaware
corporation.
(g) "Common Stock" shall mean the Common Stock of the Company.
(h) "Disability" means permanent and total disability as
determined by the Administrator in accordance with the standards set forth in
Section 22(e)(3) of the Code.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
(j) "Expiration Date" shall mean the last day of the term of an
Option established under Section 6(c).
(k) "Fair Market Value" means as of any given date (a) the
closing price of the Common Stock on American Stock Exchange, Inc. as reported
in the Wall Street Journal; or (b) if the Common Stock is no longer quoted on
American Stock Exchange, Inc. but is listed on another established stock
exchange or quoted on any established interdealer quotation system, the closing
price for the Common Stock on such exchange or system, as reported in the Wall
Street Journal.
(l) "Nonemployee Director" shall mean any person who is a member
of the Board but is not an employee of the Company or any Affiliate of the
Company and has not been an employee of the Company or any Affiliate of the
Company at any time during the preceding twelve months. Service as a director
does not in itself constitute employment for purposes of this definition.
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(m) "Option" shall mean a stock option granted pursuant to this
Plan. Each Option shall be a nonstatutory option not intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code.
(n) "Option Agreement" shall mean the written agreement
described in Section 6 evidencing the grant of an Option to a Nonemployee
Director and containing the terms, conditions and restrictions pertaining to
such Option.
(o) "Optionee" shall mean a Nonemployee Director who holds an
Option.
(p) "Plan" shall mean this Identix Incorporated Nonemployee
Directors Stock Option Plan, as it may be amended from time to time.
(q) "Section" unless the context clearly indicates otherwise,
shall refer to a Section of this Plan.
(r) "Shares" shall mean the shares of Common Stock subject to an
Option granted under this Plan.
(s) "Tax Date" means the date defined in Section 7(c).
(t) "Termination" means, for purposes of the Plan, with respect
to an Optionee, that the Optionee has ceased to be, for any reason, a director
of the Company.
(u) "Window Period" means any 10 day period beginning on the
third business day following the date of release for publication of the
Company's quarterly or annual summary statements of earnings or such other
period as is specified in Rule 16b-3(e) under the Exchange Act, as such rule may
be amended from time to time, or any successor to such rule.
3. Administration.
(a) Administrator. The Plan shall be administered by the Board
or, upon delegation by the Board, by a committee consisting of not less than two
directors (in either case, the "Administrator"). The Administrator shall have no
authority, discretion or power to select the Nonemployee Directors who will
receive Options hereunder or to set the number of shares to be covered by each
Option granted hereunder, the exercise price of such Option, the timing of the
grant of such Option or the period within which such Option may be exercised. In
connection with the administration of the Plan, the
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Administrator shall have the powers possessed by the Board. The Administrator
may act only by a majority of its members. The Administrator may delegate
administrative duties to such employees of the Company as it deems proper, so
long as such delegation is not otherwise prohibited by Rule 16b-3 under the
Exchange Act. The Board at any time may terminate the authority delegated to any
committee of the Board pursuant to this Section 3(a) and revest in the Board the
administration of the Plan.
(b) Administrator Determinations Binding. Subject to the
limitations set forth in Section 3(a), the Administrator may adopt, alter and
repeal administrative rules, guidelines and practices governing the Plan as it
from time to time shall deem advisable, may interpret the terms and provisions
of the Plan, any Option and any Option Agreement and may otherwise supervise the
administration of the Plan. All decisions made by the Administrator under the
Plan shall be binding on all persons, including the Company and Optionees. No
member of the Administrator shall be liable for any action that he or she has in
good faith taken or failed to take with respect to this Plan or any Option.
4. Eligibility.
Only Nonemployee Directors may receive Options under this Plan.
5. Shares Subject to Plan.
(a) Aggregate Number. Subject to Section 9, the total number of
shares of Common Stock reserved and available for issuance pursuant to Options
under this Plan shall be 860,000 shares. Such shares may consist, in whole or in
part, of authorized and unissued shares or shares reacquired in private
transactions or open market purchases, but all shares issued under the Plan
regardless of source shall be counted against the 860,000 share limitation. If
any Option terminates or expires without being exercised in full, the shares
issuable under such Option shall again be available for issuance in connection
with other Options. If shares of Common Stock issued pursuant to an Option are
repurchased by the Company, such Common Stock shall not again be available for
issuance in connection with Options. To the extent the number of shares of
Common Stock issued pursuant to an Option is reduced to satisfy withholding tax
obligations, the number of shares withheld to satisfy the withholding tax
obligations shall not be available for later grant under the Plan.
(b) No Rights as a Shareholder. An Optionee shall have no rights
as a shareholder with respect to any Shares covered by his or her Option until
the issuance (as evidenced by the appropriate entry on the books of the Company
or its duly authorized transfer agent) of a stock certificate evidencing such
Shares. Subject to Section 9, no adjustment shall be made for dividends
(ordinary or extraordinary, whether in cash,
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securities or other property), distributions, or other rights for which the
record date is prior to the date the certificate is issued.
6. Grant of Options.
(a) Mandatory Option Grants upon Adoption of the Plan. Subject
to the terms and conditions of this Plan, the Company shall, upon adoption of
this Plan, grant to each Nonemployee Director an Option to purchase 30,000
shares of Common Stock at an exercise price equal to the Fair Market Value of
such Shares on the date of adoption.
(b) Mandatory Initial Option Grants. Subject to the terms and
conditions of this Plan, if any person who is not, and has not been in the
preceding twelve months, an officer or employee of the Company is elected or
appointed as a member of the Board, then on the effective date of such
appointment or election the Company shall grant to such new Nonemployee
Director: (i) an Option to purchase 30,000 Shares at an exercise price equal to
the Fair Market Value of such Shares on the date of such option grant if less
than six months have elapsed since the Company's last annual meeting of the
shareholders or (ii) an Option to purchase 15,000 shares of Common Stock if at
least six months have elapsed since the Company's last annual meeting of
shareholders.
(c) Mandatory Annual Option Grants. Subject to the terms and
conditions of this Plan, on the date of the first meeting of the Board
immediately following the annual meeting of shareholders of the Company (even if
held on the same day as the meeting of shareholders) the Company shall grant to
each such Nonemployee Director then in office an Option to purchase 30,000
Shares at an exercise price equal to the Fair Market Value of such Shares on the
date of such option grant.
(d) Terms; Vesting. Subject to the other provisions of this
Plan, each Option granted pursuant to this Plan shall be for a term of ten
years. Each Option granted under this Plan shall become exercisable with respect
to one fourth of the number of Shares covered by such Option for each three
month period which elapses after the date of grant, so that such Option shall be
fully exercisable on the first anniversary of the date such Option was granted.
(e) Limitation on Other Grants. The Administrator shall have no
discretion to grant Options under this Plan other than as set forth in Sections
6(a), 6(b) and 6(c).
(f) Option Agreement. As soon as practicable after the grant of
an Option, the Optionee and the Company shall enter into a written Option
Agreement which
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specifies the date of grant, the number of Shares, the option price, and the
other terms and conditions applicable to the Option.
(g) Transferability. No Option shall be transferable otherwise
than by will or the laws of descent and distribution, and an Option shall be
exercisable during the Optionee's lifetime only by the Optionee.
(h) Limits on Exercise. Subject to the other provisions of this
Plan, an Option shall be exercisable in such amounts as are specified in the
Option Agreement.
(i) Limits on Exercise Price. Unless approved by the holders of
a majority of the Company's shares present and entitled to vote at a duly
convened meeting of the Company's shareholders, the Company shall not grant any
Options with an exercise price that is less than 100% of the Fair Market Value
of the underlying Shares on the date of grant or reduce the exercise price of
any Option granted under the Plan.
(j) Exercise Procedures. To the extent the right to purchase
Shares has accrued, Options may be exercised, in whole or in part, from time to
time, by written notice from the Optionee to the Company stating the number of
Shares being purchased, accompanied by payment of the exercise price for the
Shares, and other applicable amounts, as provided in Section 7.
(k) Termination. In the event of Termination, Options held at
the date of Termination (and only to the extent then exercisable) may be
exercised in whole or in part at any time within three months after the date of
Termination (but in no event after the Expiration Date), but not thereafter.
Notwithstanding the foregoing, if Termination is due to retirement or to death
or Disability, Options held at the date of Termination (and only to the extent
then exercisable) may be exercised in whole or in part by the Optionee in the
case of retirement or Disability, by the participant's guardian or legal
representative or by the person to whom the Option is transferred by will or the
laws of descent and distribution, at any time within two years from the date of
Termination (but in no event after the Expiration Date).
7. Payment and Taxes upon Exercise of Options.
(a) Purchase Price. The purchase price of Shares issued under
this Plan shall be paid in full at the time an Option is exercised.
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(b) Delivery of Purchase Price. Optionees may make all or any
portion of any payment due to the Company
(i) upon exercise of an Option, or
(ii) with respect to federal, state, local or foreign
tax payable in connection with the exercise of an Option, by delivery of (x)
cash, (y) check, or (z) a promissory note of the Optionee or shares of Common
Stock so long as, if applicable, such property constitutes valid consideration
for the Common Stock under, and otherwise complies with, applicable law. No
promissory note under the Plan shall have a term (including extensions) of more
than five years or shall be of a principal amount exceeding 90% of the purchase
price paid by the borrower. Exercise of an Option may be made pursuant to a
"cashless exercise/sale" procedure pursuant to which funds to pay for exercise
of the Option are delivered to the Company by a broker upon receipt of stock
certificates from the Company, or pursuant to which Optionees obtain margin
loans from brokers to fund the exercise of the Option.
(c) Tax Withholding. The Optionee shall pay to the Company in
cash, promptly upon exercise of an Option or, if later, the date that the amount
of such obligations becomes determinable (in either case, the "Tax Date"), all
applicable federal, state, local and foreign withholding taxes that the
Administrator, in its discretion, determines to result upon exercise of an
Option or from a transfer or other disposition of shares of Common Stock
acquired upon exercise of an Option or otherwise related to an Option or shares
of Common Stock acquired in connection with an Option.
A person who has exercised an Option may make an
election (i) to deliver to the Company a promissory note of the Optionee on the
terms set forth in Section 7(b), (ii) to tender to the Company previously-owned
shares of Common Stock held for at least six months, or (iii) to have shares of
Common Stock to be obtained upon exercise of the Option withheld by the Company
on behalf of the Optionee, to pay the amount of tax that the Administrator, in
its discretion, determines to be required to be withheld by the Company. Any
election pursuant to clause (iii) above by a Optionee subject to Section 16 of
the Exchange Act shall be subject to the following limitations: (1) such
election must be made at least six months before the Tax Date and shall be
irrevocable; or (2) such election must be made in (or made earlier to take
effect in) any Window Period (and the withholding of the shares of Common Stock
shall take place during such Window Period) and shall be subject to approval by
the Board, which approval may be given any time after such election has been
made, and the Option must be held at least six months prior to the Tax Date;
provided, that, the election referenced in clause (2) above may not be made
unless (A) such election is consistent with Rule 16b-3(c)(2)(ii) under the
Exchange Act, and (B) the Company has been subject to the reporting requirements
of Section 13(a) of the Exchange Act for at least one year and has
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filed all reports and statements required to be filed pursuant to that section
for that year. The right to so withhold shares of Common Stock shall relate
separately to each Option.
Any shares tendered to or withheld by the Company will
be valued at Fair Market Value on such date. The value of the shares of Common
Stock tendered or withheld may not exceed the required federal, state, local and
foreign withholding tax obligations as computed by the Company.
8. Use of Proceeds.
Proceeds from the sale of Shares pursuant to this Plan shall be
used for general corporate purposes.
9. Adjustment of Shares.
In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, stock split or other change in corporate
structure affecting the Common Stock, appropriate adjustments shall be made by
the Administrator in the aggregate number and kind of shares of Stock reserved
for issuance under the Plan and in the number, kind and exercise price of shares
subject to outstanding Options; provided, however, that the number of shares
subject to any Option shall always be a whole number.
10. Effect of Change in Control.
In the event of a "Change in Control," any Options outstanding
as of the date such Change in Control is determined to have occurred and not
then exercisable and vested shall become fully exercisable and vested.
11. No Right to Directorship.
Neither this Plan nor any Option granted hereunder shall confer
upon any Optionee any right with respect to continuation of the Optionee's
membership on the Board or shall interfere in any way with provisions in the
Company's Articles of Incorporation and By-Laws relating to the election,
appointment, terms of office, and removal of members of the Board.
12. Legal Requirements.
The Company shall not be obligated to offer or sell any Shares
upon exercise of any Option unless the Shares are at that time effectively
registered or exempt from registration under the federal securities laws and the
offer and sale of the Shares are otherwise in compliance with all applicable
securities laws and the regulations of any stock exchange on which the Company's
securities may then be listed. The Company shall have no obligation to register
the securities covered by this Plan under the federal
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securities laws or take any other steps as may be necessary to enable the
securities covered by this Plan to be offered and sold under federal or other
securities laws. Upon exercising all or any portion of an Option, an Optionee
may be required to furnish representations or undertakings deemed appropriate by
the Company to enable the offer and sale of the Shares or subsequent transfers
of any interest in the Shares to comply with applicable securities laws.
Certificates evidencing Shares acquired upon exercise of Options shall bear any
legend required by, or useful for purposes of compliance with, applicable
securities laws, this Plan or the Option Agreements.
13. Duration and Amendments.
(a) Duration. This Plan shall become effective upon adoption by
the Board provided, however, that no Option shall be exercisable unless and
until written consent of the shareholders of the Company, or approval of
shareholders of the Company voting at a validly called shareholders' meeting, is
obtained within 12 months after adoption by the Board. If such shareholder
approval is not obtained within such time, Options granted hereunder shall
terminate and be of no force and effect from and after expiration of such
12-month period.
(b) Amendment and Termination. The Board may amend, alter or
discontinue the Plan or any Option, but no amendment, alteration or
discontinuance shall be made which would impair the rights of an Optionee under
an outstanding Option without the Optionee's consent. Notwithstanding the
foregoing sentence, Section 6(i) of the Plan may not be amended or repealed
without the approval of a majority of the voting power entitled to vote at a
duly held shareholders' meeting or by an action by written consent. In addition,
the Board may not amend or alter the Plan without the approval of shareholders
of the Company entitled to vote at a duly held shareholders' meeting or by an
action by written consent and, if at a meeting, a quorum of the voting power of
the Company is represented in person or by proxy, where such amendment or
alteration would, except as expressly provided in the Plan, increase the total
number of shares reserved for issuance pursuant to Options under the Plan or in
such other circumstances as the Board deems appropriate to comply with Rule
16b-3 under the Exchange Act or otherwise. Notwithstanding any other provision
of this Section 13(b), the provisions of the Plan governing (A) who is granted
Options, (B) the number of Shares to be covered by each Option, (C) the exercise
price of each Option, (D) the timing of the grant of each Option, or (E) the
period within which each Option may be exercised, shall not be amended more than
once every six months, other than to comport with changes in the Code or the
rules thereunder or the Employee Retirement Income Security Act of 1974, as
amended, or the rules thereunder.
(c) Effect of Amendment or Termination. No Shares shall be
issued or
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sold under this Plan after the termination hereof, except upon exercise of an
Option granted before termination. Termination or amendment of this Plan shall
not affect any Shares previously issued and sold or any Option previously
granted under this Plan.
14. Rule 16b-3.
With respect to persons subject to Section 16 of the Exchange
Act, transactions under this Plan are intended to comply with the applicable
conditions of Rule 16b-3 under the Exchange Act. To the extent any provision of
this Plan or action by the Administrator fails to so comply, it shall be
adjusted to comply with Rule 16b-3, to the extent permitted by law and deemed
advisable by the Administrator. It shall be the responsibility of persons
subject to Section 16 of the Exchange Act, not of the Company or the
Administrator, to comply with the requirements of Section 16 of the Exchange
Act; and neither the Company nor the Administrator shall be liable if this Plan
or any transaction under this Plan fails to comply with the applicable
conditions of Rule 16b-3, or if any such person incurs any liability under
Section 16 of the Exchange Act.
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Amended to Reflect Changes Adopted at the Annual Meeting of Stockholders on
October 26, 2000 and Further Amended to Reflect Changes Adopted by Unanimous
Written Consent of the Board on June 18, 2001 and on January 29, 2002.
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