1993 Stock Option Plan - Peet's Companies Inc.
PEET'S COMPANIES. INC.
AMENDED AND RESTATED 1993 STOCK OPTION PLAN
1. Purpose
The purpose of the Amended and Restated 1993 Stock Option Plan (this
"Plan") is to provide a means whereby selected employees, directors, officers,
agents, consultants, advisors and independent contractors of Peet's Companies,
Inc. (the "Company"), or of any parent or subsidiary (as defined in subsection
5.8 and referred to hereinafter as "related corporations") thereof, may be
granted incentive stock options and/or nonqualified stock options to purchase
the Common Stock (as defined in Section 3) of the Company, in order to attract
and retain the services or advice of such employees, directors, officers,
agents, consultants, advisors and independent contractors and to provide added
incentive to such persons by encouraging stock ownership in the Company.
2. Administration
This Plan shall be administered by the Board of Directors of the Company
(the "Board") or, in the event the Board shall appoint and/or authorize a
committee to administer this Plan, by such committee. The administrator of this
Plan shall hereinafter be referred to as the "Plan Administrator."
In the event a member of the Plan Administrator (or the committee) may be
eligible, subject to the restrictions set forth in Section 4, to participate in
or receive or hold options under this Plan, no member of the Plan Administrator
shall vote with respect to the granting of an option hereunder to himself or
herself, as the case may be, and, if state corporate law does not permit a
committee to grant options to directors, then any option granted under this Plan
to a director for his or her services as such shall be approved by the full
Board.
The members of any committee serving as Plan Administrator shall be
appointed by the Board for such term as the Board may determine. The Board may
from time to time remove members from, or add members to, the committee.
Vacancies on the committee, however caused, shall be filled by the Board.
With respect to grants made under this Plan to individuals who are subject
to Section 16 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), the Plan Administrator shall be constituted at all times so as to meet
the requirements of Rule 16b-3 promulgated under Section 16(b) of the Exchange
Act if any of the Company's equity securities are registered pursuant to Section
12(b) or 12(g) of the Exchange Act.
2.1 Procedures.
The Board shall designate one of the members of the Plan Administrator
as chairman. The Plan Administrator may hold meetings at such times and places
as it shall determine. The acts of a majority of the members of the Plan
Administrator present at meetings
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at which a quorum exists, or acts reduced to or approved in writing by all Plan
Administrator members, shall be valid acts of the Plan Administrator.
2.2 Responsibilities.
Except for the terms and conditions explicitly set forth in this Plan,
the Plan Administrator shall have the authority, in its discretion, to determine
all matters relating to the options to be granted under this Plan, including
selection of the individuals to be granted options, the number of shares to be
subject to each option, the exercise price, and all other terms and conditions
of the options. Grants under this Plan need not be identical in any respect,
even when made simultaneously. The interpretation and construction by the Plan
Administrator of any terms or provisions of this Plan or any option issued
hereunder, or of any rule or regulation promulgated in connection herewith,
shall be conclusive and binding on all interested parties, so long as such
interpretation and construction with respect to incentive stock options
correspond to the requirements of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), the regulations thereunder and any amendments
thereto.
2.3 Rule 16b-3 Compliance and Bifurcation of Plan.
It is the intention of the Company that, if any of the Company's
equity securities are registered pursuant to Section 12(b) or 12(g) of the
Exchange Act, this Plan shall comply in all respects with Rule 16b-3 under the
Exchange Act. If any Plan provision is later found not to be in compliance with
such Rule, the provision shall be deemed null and void, and in all events this
Plan shall be construed in favor of its meeting the requirements of Rule 16b-3.
Notwithstanding anything in this Plan to the contrary, the Board, in its
absolute discretion, may bifurcate this Plan so as to restrict, limit or
condition the application of any provision of this Plan to participants who are
subject to Section 16 of the Exchange Act without so restricting, limiting or
conditioning this Plan with respect to other participants.
3. Shares Subject to This Plan
The shares subject to this Plan shall be the Company's Common Stock (the
"Common Stock"), currently authorized but unissued. Subject to adjustment as
provided in Section 7, the aggregate amount of Common Stock to be delivered upon
the exercise of all options granted under this Plan shall not exceed 415,800
shares as such Common Stock was constituted on the effective date of this Plan;
provided, however, that the number of shares of Common Stock available for
issuance under this Plan shall be reduced from time to time in direct proportion
to the number of shares of Common Stock reserved for issuance pursuant to
options granted under the Company's 1994 California Stock Option Plan. If any
option granted under this Plan shall expire or be surrendered, exchanged for
another option, canceled or terminated for any reason without having been
exercised in full, the unpurchased shares subject thereto shall thereupon again
be available for purposes of this Plan, including for replacement options which
may be granted in exchange for such expired, surrendered, exchanged, canceled or
terminated options.
4. Eligibility
An incentive stock option may be granted only to any individual who, at the
time the option is granted, is an employee of the Company or any related
corporation. A nonqualified
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stock option may be granted to any employee, director, officer, agent,
consultant, or advisor of the Company or any related corporation, whether an
individual or an entity. Any party to whom an option is granted under this Plan
shall be referred to hereinafter as an "Optionee."
5. Terms and Conditions of Options
Options granted under this Plan shall be evidenced by written agreements
which shall contain such terms, conditions, limitations and restrictions as the
Plan Administrator shall deem advisable and which are not inconsistent with this
Plan. Notwithstanding the foregoing, options shall include or incorporate by
reference the following terms and conditions:
5.1 Number of Shares and Price.
The maximum number of shares that may be purchased pursuant to the
exercise of each option and the price per share at which such option is
exercisable (the "exercise price") shall be as established by the Plan
Administrator, provided that the Plan Administrator shall act in good faith to
establish the exercise price which shall be not less than the fair market value
per share of the Common Stock at the time the option is granted with respect to
incentive stock options and not less than 85% of the fair market value of the
Common Stock at the time the option is granted with respect to nonqualified
stock options, and also provided that, with respect to incentive stock options
granted to greater than 10% shareholders, the exercise price shall be as
required by subsection 6.1. The foregoing notwithstanding, the maximum number
of shares with respect to which an option or options may be granted to any
Optionee in any one fiscal year of the Company shall not exceed 300,000 shares
(the "Maximum Annual Optionee Grant").
5.2 Term and Maturity.
Subject to the restrictions contained in Section 6 with respect to
granting incentive stock options to greater than 10% shareholders, the term of
each incentive stock option shall be as established by the Plan Administrator
and, if not so established, shall be 10 years from the date it is granted but in
no event shall it exceed 10 years. The term of each nonqualified stock option
shall be as established by the Plan Administrator and, if not so established,
shall be 10 years. To ensure that the Company or related corporation will
achieve the purpose and receive the benefits contemplated in this Plan, any
option granted to any Optionee hereunder shall, unless the condition of this
sentence is waived or modified in the agreement evidencing the option or by
resolution adopted at any time by the Plan Administrator, be exercisable
according to the following schedule:
Period Of Optionee's Continuous Relationship Portion of Total
With The Company Or Related Corporation Option Which Is
From The Date The Option Is Granted Exercisable
Upon Grant 60%
After 1 year 80%
After 2 years 100%
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5.3 Exercise.
Subject to the vesting schedule described in subsection 5.2, each
option may be exercised in whole or in part at any time and from time to time.
However, the Plan Administrator may in its discretion require that a minimum
number of shares be purchased upon any exercise of option rights hereunder,
provided that such minimum may in no event exceed 100 shares. Only whole shares
will be issued pursuant to the exercise of any option. An option shall be
exercised by delivery to the Company of notice of the number of shares with
respect to which the option is exercised, together with payment of the exercise
price.
5.4 Payment of Exercise Price.
Payment of the option exercise price shall be made in full at the time
the notice of exercise of the option is delivered to the Company and shall be in
cash, bank certified or cashier's check or personal check (unless at the time of
exercise the Plan Administrator in a particular case determines not to accept a
personal check) for the shares being purchased.
The Plan Administrator can determine at any time before exercise that
additional forms of payment will be permitted. To the extent permitted by the
Plan Administrator and applicable laws and regulations (including, but not
limited to, federal tax and securities laws and regulations and state corporate
law), an option may be exercised by:
(a) delivery of shares of Common Stock of the Company held by an
Optionee having a fair market value equal to the exercise price, such fair
market value to be determined in good faith by the Plan Administrator; provided,
however, that payment in stock held by an Optionee shall not be made unless the
stock shall have been owned by the Optionee for a period of at least six months;
(b) delivery of a full-recourse promissory note executed by the
Optionee; provided that (i) such note delivered in connection with an incentive
stock option shall, and such note delivered in connection with a nonqualified
stock option may, in the sole discretion of the Plan Administrator, bear
interest at a rate specified by the Plan Administrator but in no case less than
the rate required to avoid imputation of interest (taking into account any
exceptions to the imputed interest rules) for federal income tax purposes, (ii)
the Plan Administrator in its sole discretion shall specify the term and other
provisions of such note at the time an incentive stock option is granted or at
any time prior to exercise of a nonqualified stock option, (iii) the Plan
Administrator may require that the Optionee pledge to the Company for the
purpose of securing the payment of such note the shares of Common Stock to be
issued to the Optionee upon exercise of the option and may require that the
certificate representing such shares be held in escrow in order to perfect the
Company's security interest, and (iv) the Plan Administrator in its sole
discretion may at any time restrict or rescind this right upon notification to
the optionee; or
(c) delivery of a properly executed exercise notice, together with
irrevocable instructions to a broker, all in accordance with the regulations of
the Federal Reserve Board, to promptly deliver to the Company the amount of sale
or loan proceeds to pay the exercise price and any federal, state or local
withholding tax obligations that may arise in connection with the exercise.
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5.5 Withholding Tax Requirement.
The Company or any related corporation shall have the right to retain
and withhold from any payment of cash or shares of Common Stock under this Plan
the amount of taxes required by any government to be withheld or otherwise
deducted and paid with respect to such payment. At its discretion, the Company
may require an Optionee receiving shares of Common Stock to reimburse the
Company for any such taxes required to be withheld by the Company and withhold
any distribution in whole or in part until the Company is so reimbursed. In
lieu thereof, the Company shall have the right to withhold from any other cash
amounts due or to become due from the Company to the Optionee an amount equal to
such taxes. The Company may also retain and withhold or the Optionee may elect,
subject to approval by the Company at its sole discretion, to have the Company
retain and withhold a number of shares having a market value not less than the
amount of such taxes required to be withheld by the Company to reimburse the
Company for any such taxes and cancel (in whole or in part) any such shares so
withheld. In order to qualify such election for exemption under Rule 16b-3
promulgated under Section 16(b) of the Exchange Act, any individual who is
subject to Section 16 under the Exchange Act must exercise the option during the
quarterly 10-day window period required under Section 16(b) of the Exchange Act
for exercises of stock appreciation rights, and the election relating to such
option exercise must be (i) an irrevocable election made six months prior to the
date the option exercise becomes taxable; (ii) an election that is made during a
window period; or (iii) an election that is made prior to a window period,
provided the election becomes effective as of the next window period.
5.6 Holding Periods.
5.6.1 Securities and Exchange Act Section 16. If an individual
subject to Section 16 of the Exchange Act sells shares of Common Stock obtained
upon the exercise of a stock option within six months after the date the option
was granted, such sale may result in short-swing profit recovery under Section
16(b) of the Exchange Act.
5.6.2 Taxation of Stock Options. In order to obtain certain tax
benefits afforded to incentive stock options under Section 422 of the Code, an
optionee must hold the shares issued upon the exercise of an incentive stock
option for two years after the date of grant of the option and one year from the
date of exercise. An optionee may be subject to the alternative minimum tax at
the time of exercise of an incentive stock option.
The Plan Administrator may require an Optionee to give the Company prompt
notice of any disposition of shares acquired by the exercise of an incentive
stock option prior to the expiration of such holding periods.
Tax advice should be obtained by an Optionee when exercising any option and
prior to the disposition of the shares issued upon the exercise of any option.
5.7 Transferability of Options.
Options granted under this Plan and the rights and privileges
conferred hereby may not be transferred, assigned, pledged or hypothecated in
any manner (whether by operation of law or otherwise) other than by will or by
the applicable laws of descent and distribution and
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shall not be subject to execution, attachment or similar process. During an
Optionee's lifetime, any options granted under this Plan are personal to him or
her and are exercisable solely by such Optionee. Any attempt to transfer,
assign, pledge, hypothecate or otherwise dispose of any option under this Plan
or of any right or privilege conferred hereby, contrary to the Code or to the
provisions of this Plan, or the sale or levy or any attachment or similar
process upon the rights and privileges conferred hereby shall be null and void.
Notwithstanding the foregoing, to the extent pertained by Rule 16b-3 under the
Exchange Act and other applicable law and regulation, the Plan Administrator may
permit an Optionee to (i) during the Optionee's lifetime, designate a person who
may exercise the option after the Optionee's death by giving written notice of
such designation to the Company. Such designation may be changed from time to
time by the Optionee by giving written notice to the Company revoking any
earlier designation and making a new designation or (ii) with respect to
nonqualified stock options, transfer the option and the rights and privileges
conferred hereby.
5.8 Termination of Relationship.
If the Optionee's relationship with the Company or any related
corporation ceases for any reason other than termination for cause, death or
total disability, and unless by its terms the option sooner terminates or
expires, then the Optionee may exercise, for a three-month period, that portion
of the Optionee's option which is exercisable at the time of such cessation, but
the Optionee's option shall terminate at the end of such period following such
cessation as to all shares for which it has not theretofore been exercised,
unless such provision is waived in the agreement evidencing the option. If, in
the case of an incentive stock option, an Optionee's relationship with the
Company or any related corporation changes (i.e., from employee to nonemployee,
such as a consultant), such change shall constitute a termination of an
Optionee's employment with the Company or any related corporation and the
Optionee's incentive stock option shall terminate in accordance with this
subsection 5.8. Upon the expiration of the three-month period following
cessation of employment in the case of an incentive stock option, or at any time
prior to the expiration of the option in the case of a nonqualified stock
option, the Plan Administrator shall have sole discretion in a particular
circumstance to extend the exercise period following such cessation to any date
up to the termination or expiration of the option. If, however, in the case of
an incentive stock option, the Optionee does not exercise the Optionee's option
within three months after cessation of employment, the option will no longer
qualify as an incentive stock option under the Code.
If an Optionee is terminated for cause, any option granted hereunder shall
automatically terminate as of the first discovery by the Company of any reason
for termination for cause, and such Optionee shall thereupon have no right to
purchase any shares pursuant to such option. Termination for cause shall mean
dismissal for dishonesty, conviction or confession of a crime punishable by law
(except minor violations), fraud, misconduct or disclosure of confidential
information. If an Optionee's relationship with the Company or any related
corporation is suspended pending an investigation of whether or not the Optionee
shall be terminated for cause, all the Optionee's rights under any option
granted hereunder likewise shall be suspended during the period of
investigation.
If an Optionee's relationship with the Company or any related corporation
ceases because of a total disability, the Optionee's option shall not terminate
or, in the case of an incentive stock
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option, cease to be treated as an incentive stock option until the end of the
12-month period following such cessation (unless by its terms it sooner
terminates and expires). As used in this Plan, the term total disability refers
to a mental or physical impairment of the Optionee which is expected to result
in death or which has lasted or is expected to last for a continuous period of
12 months or more and which causes the Optionee to be unable, in the opinion of
the Company and two independent physicians, to perform his or her duties for the
Company and to be engaged in any substantial gainful activity. Total disability
shall be deemed to have occurred on the first day after the Company and the two
independent physicians have furnished their opinion of total disability to the
Plan Administrator.
Options granted under the Plan shall not be affected by any change of
relationship with the Company so long as the Optionee continues to be an
employee, director, officer, agent, consultant, advisor or independent
contractor of the Company or of a related corporation; however, a change in an
Optionee's status from an employee to a nonemployee (e.g., consultant or
independent contractor) shall result in the termination of an outstanding
incentive stock option held by such Optionee. The Plan Administrator, in its
absolute discretion, may determine all questions of whether particular leaves of
absence constitute a termination of services; provided, however, that with
respect to incentive stock options, such determination shall be subject to any
requirements contained in the Code. The foregoing notwithstanding, with respect
to incentive stock options, employment shall not be deemed to continue beyond
the first 90 days of such leave, unless the Optionee's reemployment rights are
guaranteed by statute or by contract.
As used herein, the term "related corporation," when referring to a
subsidiary corporation, shall mean any corporation (other than the Company) in,
at the time of the granting of the option, an unbroken chain of corporations
ending with the Company, if stock possessing 50% or more of the total combined
voting power of all classes of stock of each of the corporations other than the
Company is owned by one of the other corporations in such chain. When referring
to a parent corporation, the term "related corporation" shall mean any
corporation in an unbroken chain of corporations ending with the Company if, at
the time of the granting of the option, each of the corporations other than the
Company owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in such chain.
5.9 Death of Optionee.
If an Optionee dies while he or she has a relationship with the
Company or any related corporation or within the three-month period (or 12-month
period in the case of totally disabled optionees) following cessation of such
relationship, any option held by such optionee to the extent that the Optionee
would have been entitled to exercise such option, may be exercised within one
year after his or her death by the personal representative of his or her estate
or by the person or persons to whom the Optionee's rights under the option shall
pass (i) by will or by the applicable laws of descent and distribution or (ii)
by a designation or transfer pursuant to Section 5.7.
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5.10 No Status As Shareholder.
Neither the Optionee nor any party to which the Optionee's rights and
privileges under the option may pass shall be, or have any of the rights or
privileges of, a shareholder of the Company with respect to any of the shares
issuable upon the exercise of any option granted under this Plan unless and
until such option has been exercised.
5.11 Continuation of Relationship.
Nothing in this Plan or in any option shall confer upon any Optionee
any right to continue in the employ or other relationship of the Company or of a
related corporation, or to interfere in any way with the right of the Company or
of any such related corporation to terminate his or her employment or other
relationship with the Company at any time.
5.12 Modification and Amendment of Option.
Subject to the requirements of Code Section 422 with respect to
incentive stock options and to the terms and conditions and within the
limitations of this Plan, the Plan Administrator may modify or amend outstanding
options granted under this Plan. The modification or amendment of an
outstanding option shall not, without the consent of the Optionee, impair or
diminish any of his or her rights or any of the obligations of the Company under
such option. Except as otherwise provided in this Plan, no outstanding option
shall be terminated without the consent of the Optionee.
5.13 Limitation on Value for Incentive Stock Options.
As to all incentive stock options granted under the terms of this
Plan, to the extent that the aggregate fair market value of the shares
(determined at the time the incentive stock option is granted) with respect to
which incentive stock options are exercisable for the first time by the Optionee
during any calendar year (under this Plan and all other incentive stock option
plans of the Company, a related corporation or a predecessor corporation)
exceeds $100,000, such options shall be treated as nonqualified stock options.
The previous sentence shall not apply if the Internal Revenue Service issues a
public rule, issues a private ruling to the Company, any Optionee or any
legatee, personal representative or distributee of an Optionee or issues
regulations changing or eliminating such annual limit.
6. Greater Than 10% Shareholders
6.1 Exercise Price and Term of Incentive Stock Options.
If an incentive stock option is granted under this Plan to any
employee who owns more than 10% of the total combined voting power of all
classes of stock of the Company or any related corporation, the term of such
incentive stock options shall not exceed five years and the exercise price shall
be not less than 110% of the fair market value of the shares at the time the
incentive stock option is granted. This provision shall control notwithstanding
any contrary terms contained in an option agreement or any other document.
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6.2 Attribution Rule.
For purposes of subsection 6.1, in determining stock ownership, an
employee shall be deemed to own the shares owned, directly or indirectly, by or
for his or her brothers, sisters, spouse, ancestors and lineal descendants.
Shares owned, directly or indirectly, by or for a corporation, partnership,
estate or trust shall be deemed to be owned proportionately by or for its
shareholders, partners or beneficiaries. If an employee or a person related to
the employee owns an unexercised option or warrant to purchase shares of the
Company, the shares subject to that portion of the option or warrant which is
unexercised shall not be counted in determining stock ownership. For purposes
of this Section 6, shares owned by an employee shall include all shares actually
issued and outstanding immediately before the grant of the incentive stock
option to the employee.
7. Adjustments Upon Changes in Capitalization
The aggregate number and class of shares for which options may be granted
under this Plan, the Maximum Annual Optionee Grant set forth in Section 5.1, the
number and class of shares covered by each outstanding option and the exercise
price per share thereof (but not the total price), and each such option, shall
all be proportionately adjusted for any increase or decrease in the number of
issued shares of Common Stock of the Company resulting from a split-up or
consolidation of shares or any like capital adjustment, or the payment of any
stock dividend.
7.1 Effect of Liquidation or Reorganization.
7.1.1 Cash, Stock or Other Property for Stock. Except as provided
in subsection 7.1.2, upon a merger (other than a merger of the Company in which
the holders of shares of Common Stock immediately prior to the merger have the
same proportionate ownership of shares of Common Stock in the surviving
corporation immediately after the merger), consolidation, acquisition of
property or stock, separation, reorganization (other than a mere reincorporation
or the creation of a holding company) or liquidation of the Company, as a result
of which the shareholders of the Company receive cash, stock or other property
in exchange for or in connection with their shares of Common Stock, any option
granted hereunder shall terminate, but the Optionee shall have the right
immediately prior to any such merger, consolidation, acquisition of property or
stock, separation, reorganization or liquidation to exercise such Optionee's
option in whole or in part whether or not the vesting requirements set forth in
the option agreement have been satisfied.
7.1.2 Conversion of Options on Stock for Stock Exchange. If the
shareholders of the Company receive capital stock of another corporation
("Exchange Stock") in exchange for their shares of Common Stock in any
transaction involving a merger (other than a merger of the Company in which the
holders of Common Stock immediately prior to the merger have the same
proportionate ownership of Common Stock in the surviving corporation immediately
after the merger), consolidation, acquisition of property or stock, separation
or reorganization (other than a mere reincorporation or the creation of a
holding company), all options granted hereunder shall be converted into options
to purchase shares of Exchange Stock unless the Company and the corporation
issuing the Exchange Stock, in their sole discretion,
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determine that any or all such options granted hereunder shall not be converted
into options to purchase shares of Exchange Stock but instead shall terminate in
accordance with the provisions of subsection 7.1.1. The amount and price of
converted options shall be determined by adjusting the amount and price of the
options granted hereunder in the same proportion as used for determining the
number of shares of Exchange Stock the holders of the Common Stock receive in
such merger, consolidation, acquisition of property or stock, separation or
reorganization. The converted options shall be fully vested whether or not the
vesting requirements set forth in the option agreement have been satisfied.
7.2 Fractional Shares.
In the event of any adjustment in the number of shares covered by any
option, any fractional shares resulting from such adjustment shall be
disregarded and each such option shall cover only the number of full shares
resulting from such adjustment.
7.3 Determination of Board to Be Final.
All Section 7 adjustments shall be made by the Board, and its
determination as to what adjustments shall be made, and the extent thereof,
shall be final, binding and conclusive. Unless an Optionee agrees otherwise,
any change or adjustment to an incentive stock option shall be made in such a
manner so as not to constitute a "modification" as defined in Code Section
425(h) and so as not to cause his or her incentive stock option issued hereunder
to fail to continue to qualify as an incentive stock option as defined in Code
Section 422(b).
8. Securities Regulation
Shares shall not be issued with respect to an option granted under this
Plan unless the exercise of such option and the issuance and delivery of such
shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, any applicable state securities laws, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange 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, including the
availability, if applicable, of an exemption from registration for the issuance
and sale of any shares hereunder. Inability of the Company to obtain, from any
regulatory body having jurisdiction, the authority deemed by the Company's
counsel to be necessary for the lawful issuance and sale of any shares hereunder
or the unavailability of an exemption from registration for the issuance and
sale of any shares hereunder shall relieve the Company of any liability in
respect of the nonissuance or sale of such shares as to which such requisite
authority shall not have been obtained.
As a condition to the exercise of an option, the Company may require the
Optionee to represent and warrant at the time of any such exercise 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 relevant provision of the
aforementioned laws. At the option of the Company, a stop-transfer order
against any shares of stock may be placed on the official stock books and
records of the Company, and a legend indicating that the stock may not be
pledged, sold or otherwise transferred unless an opinion of
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counsel is provided (concurred in by counsel for the Company) stating that such
transfer is not in violation of any applicable law or regulation, may be stamped
on stock certificates in order to assure exemption from registration. The Plan
Administrator may also require such other action or agreement by the Optionees
as may from time to time be necessary to comply with the federal and state
securities laws. THIS PROVISION SHALL NOT OBLIGATE THE COMPANY TO UNDERTAKE
REGISTRATION OF THE OPTIONS OR STOCK HEREUNDER.
Should any of the Company's capital stock of the same class as the stock
subject to options granted hereunder be listed on a national securities
exchange, all stock issued hereunder if not previously listed on such exchange
shall be authorized by that exchange for listing thereon prior to the issuance
thereof.
9. Amendment and Termination
9.1 Board Action.
The Board may at any time suspend, amend or terminate this Plan,
provided that, to the extent required for compliance with Rule 16b-3 promulgated
under Section 16(b) of the Exchange Act, Section 422 of the Code or by any
applicable law or regulation, the Company's shareholders must approve any
amendment which will:
(a) increase the number of shares that may be issued under this Plan;
(b) with respect to nonqualified stock options, materially modify the
requirements as to eligibility for participation in this Plan or, with respect
to incentive stock options, change the designation of the participants or class
of participants eligible for participation in this Plan;
(c) materially increase the benefits accruing to the participants
under this Plan; or
(d) otherwise require shareholder approval under any applicable law
or regulation.
Such shareholder approval must be obtained (i) within 12 months of the
adoption by the Board of such amendment or (ii) if earlier, and to the extent
required for compliance with Rule 16b-3 promulgated under Section 16(b) of the
Exchange Act, at the next annual meeting of shareholders after such adoption by
the Board.
Any amendment made to this Plan which would constitute a "modification" to
incentive stock options outstanding on the date of such amendment, shall not be
applicable to such outstanding incentive stock options, but shall have
prospective effect only, unless the Optionee agrees otherwise.
9.2 Automatic Termination.
Unless sooner terminated by the Board, this Plan shall terminate ten
years from the earlier of (a) the date on which this Plan is adopted by the
Board or (b) the date on which this
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Plan is approved by the shareholders of the Company. No option may be granted
after such termination or during any suspension of this Plan. The amendment or
termination of this Plan shall not, without the consent of the option holder,
alter or impair any rights or obligations under any option theretofore granted
under this Plan.
10. Effectiveness of This Plan
This Plan shall become effective upon adoption by the Board so long as it
is approved by a majority of stock represented by shareholders voting either in
person or by proxy at a duly held shareholders' meeting any time within 12
months before or after the adoption of this Plan.
Plan adopted by the Board of Directors on December 20, 1993 and approved by
the shareholders on January 11, 1994. Amended by the Board of Directors on July
20, 1994 and approved by the shareholders on August 29, 1994. Amended by the
Board of Directors on February 22, 1995.
12.