EMCORE CORP. 8-K EX-10.2 -- 2000 EMPLOYEE STOCK PURCHASE PLAN - REVISED 2/13/06
Published on February 17, 2006
Exhibit
10.2
EMCORE
CORPORATION
AMENDED
AND RESTATED 2000 EMPLOYEE STOCK PURCHASE PLAN
Revised
February 13, 2006
ARTICLE
I
ESTABLISHMENT
Purpose
The
EMCORE
Corporation 2000 Employee Stock Purchase Plan (the “Plan”) is hereby established
by EMCORE
Corporation (the “Company”), the purpose of which is to provide a method whereby
employees of the Company or any Designated Subsidiary (as defined herein),
will
have an opportunity to acquire a proprietary interest in the Company through
the
purchase of shares of Common Stock. The Plan is also established to help
promote
the overall financial objectives of the Company’s stockholders by promoting
those persons participating in the Plan to achieve long-term growth in
stockholder equity. The Plan is intended to qualify as an “employee stock
purchase plan” under Section 423 of the Internal Revenue Code of 1986, as
amended (the “Code”). The provisions of the Plan shall be construed so as to
extend and limit participation in a manner consistent with the requirements
of
Section 423 of the Code and the regulations promulgated thereunder.
ARTICLE
II
DEFINITIONS
The
following words and phrases, as used herein, shall have the meanings indicated
unless the context clearly indicates to the contrary:
2.01 Account
shall
mean the bookkeeping account established on behalf of a Participant to which
is
credited all contributions paid for the purpose of purchasing Common Stock
under
the Plan, and to which shall be charged all purchases of Common Stock, or
withdrawals, pursuant to the Plan. Such Account shall remain unfunded as
described in Section 8.11 of the Plan.
2.02 Affiliate
shall
mean, with respect to any Person, any other Person that, directly or indirectly,
controls, is controlled by, or is under common control with, such Person.
Any
“Relative” (for this purpose, “Relative” means a spouse, child, parent, parent
of spouse, sibling or grandchild) of an individual shall be deemed to be
an
Affiliate of such individual for this purpose. Neither the Company nor any
Person controlled by the Company shall be deemed to be an Affiliate of any
holder of Common Stock.
2.03 Agreement
shall
mean, either individually or collectively, any subscription, enrollment and/or
withholding agreement, in the form prescribed by the Committee, entered into
pursuant to the Plan between the Company or a Designated Subsidiary and a
Participant. Such Agreement shall be an authorization for the Company or
a
Designated Subsidiary to withhold amounts from such Participant’s Compensation,
at the Contribution Rate specified in the Agreement, to be applied to purchase
Common Stock.
2.04
Beneficial
Ownership
(including correlative terms) shall have the meaning given such term in Rule
13d-3 promulgated under the Exchange Act.
2.05 Beneficiary
shall
mean the person specified by a Participant in his or her most recent written
designation that is filed with the Committee to receive any benefits under
the
Plan in the event of such Participant’s death, in accordance with Section
8.01.
2.06 Board
shall
mean the Board of Directors of the Company.
2.07 Change
in Control
shall
mean the occurrence of any of the following:
(a)
an
acquisition in one transaction or a series of related transactions (other
than
directly from the Company or pursuant to awards granted under the Plan or
compensatory options or other similar awards granted by the Company) of any
Voting Securities by any Person, immediately after which such Person has
Beneficial Ownership of fifty percent (50%) or more of the combined voting
power
of the Company’s then outstanding Voting Securities; provided,
however,
in
determining whether a Change in Control has occurred pursuant to this Section
2.07(a), Voting Securities which are acquired in a Non-Control Acquisition
shall
not constitute an acquisition that would cause a Change in Control;
(b)
the
individuals who, immediately prior to the Effective Date, are members of
the
Board (the “Incumbent
Board”),
cease
for any reason to constitute at least a majority of the members of the Board;
provided,
however,
that if
the election, or nomination for election, by the Company’s common stockholders,
of any new director was approved by a vote of at least a majority of the
Incumbent Board, such new director shall, for purposes of the Plan, be
considered as a member of the Incumbent Board; provided
further,
however,
that no
individual shall be considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an actual or
threatened “Election Contest” (as described in Rule 14a-11 promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or consents
by or on behalf of a Person other than the Board (a “Proxy
Contest”)
including by reason of any agreement intended to avoid or settle any Election
Contest or Proxy Contest; or
(c)
the
consummation of:
(1)
a
merger, consolidation or reorganization involving the Company
unless:
(A)
the
stockholders of the Company, immediately before such merger, consolidation
or
reorganization, own, directly or indirectly, immediately following such merger,
consolidation or reorganization, more than fifty percent (50%) of the combined
voting power of the outstanding voting securities of the corporation resulting
from such merger or consolidation or reorganization (the “Surviving
Corporation”)
in
substantially the same proportion as their ownership of the Voting Securities
immediately before such merger, consolidation or reorganization,
(B)
the
individuals who were members of the Incumbent Board immediately prior to
the
execution of the agreement providing for such merger, consolidation or
reorganization constitute at least a majority of the members of the board
of
directors of the Surviving Corporation, or a corporation Beneficially Owning,
directly or indirectly, a majority of the voting securities of the Surviving
Corporation, and
(C)
no
Person, other
than
(i) the
Company, (ii) any Related Entity (as defined in Section 2.20), (iii) any
employee benefit plan (or any trust forming a part thereof) that, immediately
prior to such merger, consolidation or reorganization, was maintained by
the
Company, the Surviving Corporation, or any Related Entity or (iv) any Person
who, together with its Affiliates, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of fifty percent
(50%)
or more of the then outstanding Voting Securities, owns, together with its
Affiliates, Beneficial Ownership of fifty percent (50%) or more of the combined
voting power of the Surviving Corporation’s then outstanding voting securities
(a
transaction described in clauses (A) through (C) above is referred to herein
as
a “Non-Control
Transaction”);
(2)
a
complete liquidation or dissolution of the Company; or
(3)
an
agreement for the sale or other disposition of all or substantially all of
the
assets or business of the Company to any Person (other than a transfer to
a
Related Entity or the distribution to the Company’s stockholders of the stock of
a Related Entity or any other assets).
Notwithstanding
the foregoing, a Change in Control shall not be deemed to occur solely because
any Person (the “Subject
Person”)
acquired Beneficial Ownership of fifty percent (50%) or more of the combined
voting power of the then outstanding Voting Securities as a result of the
acquisition of Voting Securities by the Company which, by reducing the number
of
Voting Securities then outstanding, increases the proportional number of
shares
Beneficially Owned by the Subject Persons, provided
that if
a Change in Control would occur (but for the operation of this sentence)
as a
result of the acquisition of Voting Securities by the Company, and (1) before
such share acquisition by the Company the Subject Person becomes the Beneficial
Owner of any new or additional Voting Securities in a related transaction
or (2)
after such share acquisition by the Company the Subject Person becomes the
Beneficial Owner of any new or additional Voting Securities which in either
case
increases the percentage of the then outstanding Voting Securities Beneficially
Owned by the Subject Person, then a Change in Control shall be deemed to
occur.
2.08 Commission
shall
mean the Securities and Exchange Commission or any successor entity or agency.
2.09 Committee
shall
mean the Plan Committee of the Board as described in Article VII.
2.10 Compensation
shall
mean, for the relevant period, (a) the total compensation paid in cash to
a
Participant by the Company and/or a Designated Subsidiary, including salaries,
wages, commissions, overtime pay, shift premiums, bonuses, and incentive
compensation, plus (b) any pre-tax contributions made by a Participant under
Section 401(k) or 125 of the Code. Compensation
shall
exclude non-cash items, moving or relocation allowances, geographic hardship
pay, car allowances, tuition reimbursements, imputed income attributable
to cars
or life insurance, severance or notice pay, fringe benefits, contributions
(except as provided in clause (b) of the immediately preceding sentence)
or
benefits received under employee benefit or deferred compensation plans or
arrangements, income attributable to stock options and similar
items.
2.11 Common
Stock
shall
mean shares of common stock of the Company, without par value, or the common
stock of any successor to the Company, which is designated for the purposes
of
the Plan.
2.12 Contribution
Rate
shall be
that rate of contribution of Compensation to the Plan stated in the Agreement,
subject to determination in accordance with Article IV.
2.13 Designated
Subsidiary shall
mean any Subsidiary that has been designated by the Board from time to time
in
its sole discretion as eligible to participate in the Plan.
2.14 Effective
Date
shall
mean April 1, 2000.
2.15 Eligible
Employee
shall
mean any individual who is employed on a full-time or part-time basis by
the
Company or a Designated Subsidiary on an Enrollment Date, except that the
Committee in its sole discretion may exclude:
(i)
employees
whose customary employment is not more than 20 hours per
week;
(ii)
employees
whose customary employment is for not more than five months in any calendar
year; and
(iii)
employees who are considered to be a highly compensated employee of the Company
or Designated Subsidiary within the meaning of Section 414(q) of the Code.
As
of the
Effective Date, and unless and until the Committee determines otherwise,
only
those employees described in Section 2.15(i) and (ii) are excluded from the
class of Eligible Employees.
2.16 Enrollment
Date
shall
mean the first day of each Offering Period.
2.17 Exchange
Act
means
the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated by the Commission thereunder.
2.18 Exercise
Date
shall
mean the last day of each Offering Period.
2.19 Fair
Market Value
of a
share of Common Stock as of a given date shall mean: (i) if the Common Stock
is
listed or admitted to trading on an established stock exchange (including,
for
this purpose, the Nasdaq National Market), the mean of the highest and lowest
sale prices for a share of the Common Stock on the composite tape or in Nasdaq
National Market trading as reported in The
Wall Street Journal (or,
if
not so reported, such other nationally recognized reporting source as the
Committee shall select) for such date, or, if no such prices are reported
for
such date, the most recent day for which such prices are available shall
be
used; (ii) if the Common Stock is not then listed or admitted to trading
on such
a stock exchange, the mean of the closing representative bid and asked prices
for the Common Stock on such date as reported by the Nasdaq Small Cap Market
or,
if not so reported, by the OTC Bulletin Board (or any successor or similar
quotation system regularly reporting the market value of the Common Stock
in the
over-the-counter market), or, if no such prices are reported for such date,
the
most recent day for which such prices are available shall be used; or (iii)
in
the event neither of the valuation methods provided for in clauses (i) and
(ii)
above are practicable, the fair market value of a share of Common Stock
determined by such other reasonable valuation method as the Committee shall,
in
its discretion, select and apply in good faith as of such date.
2.20 Non-Control
Acquisition
shall
mean an acquisition by (1) an employee benefit plan (or a trust forming a
part
thereof) maintained by (x) the Company or (y) any corporation or other Person
of
which a majority of its voting power or its voting equity securities or equity
interest is owned, directly or indirectly, by the Company (a “Related
Entity”),
(2)
the Company or any Related Entity, (3) any of Thomas Russell, The AER Trust
1997, Robert Louis-Dreyfus, Gallium Enterprises, Inc. and Reuben Richards,
or
(4) any Person in connection with a Non-Control Transaction.
2.21 Offering
Period
shall
mean a period as determined by the Committee during which a Participant’s Option
may be exercised and the accumulated value of the Participant’s Account may be
applied to purchase Common Stock. Unless otherwise specified by the Committee,
the initial Offering Period will begin on the Effective Date and end on the
last
Trading Day on or before December 31st
of the
same calendar year. Thereafter, each successive Offering Period shall consist
of
twelve-month periods commencing on the first Trading Day on or after January
1st
of each
calendar year and ending on the last Trading Day on or before December
31st
of such
year. The duration of Offering Periods may be changed by the Committee or
the
Board pursuant to Section 3.06 or 5.04.
2.22 Option
shall
mean the right to purchase the number of shares of Common Stock specified
in
accordance with the Plan at a price and for a term fixed in accordance with
the
Plan, and subject to such other limitations and restrictions as may be imposed
by the Plan or the Committee in accordance with the Plan.
2.23 Option
Price
shall
mean an amount equal to 85% of the Fair Market Value of a share of Common
Stock
on the Enrollment Date or Exercise Date, whichever is lower.
2.24 Participant
shall
mean an Eligible Employee who satisfies the eligibility conditions of Article
III, and to whom an Option has been granted by the Committee under the Plan.
2.25 Person
shall
mean “person” as such term is used for purposes of Section 13(d) or 14(d) of the
Exchange Act, including, without limitation, any individual, corporation,
limited liability company, partnership, trust, unincorporated organization,
government or any agency or political subdivision thereof, or any other entity
or any group of Persons.
2.26 Plan
Year
shall
mean the period of twelve (12) or fewer consecutive months commencing on
the
Effective Date and ending on December 31st
of the
same calendar year, and the twelve (12) consecutive month period ending the
last
day of each December of each calendar year thereafter. The Committee may
at any
time designate another period as the Plan Year.
2.27 Reserves
shall
mean the number of shares of Common Stock covered by each Option under the
Plan
that have not yet been exercised and the number of shares of Common Stock
that
have been authorized for issuance under the Plan but not yet placed under
an
Option.
2.28 Securities
Act
shall
mean the Securities Act of 1933, as amended, and the rules and regulations
promulgated by the Commission thereunder.
2.29 Subsidiary
shall
mean any present or future corporation, domestic or foreign, which is or
would
be a “subsidiary corporation,” as defined under Section 424(f) of the Code, of
the Company.
2.30 Trading
Day
shall
mean a day on which national stock exchanges are open for trading.
2.31 Voting
Securities
shall
mean all outstanding voting securities of the Company entitled to vote generally
in the election of the Board.
ARTICLE
III
ELIGIBILITY
AND PARTICIPATION
3.01
Initial
Eligibility
Any
individual who is otherwise an Eligible Employee and who is employed with
the
Company or a Designated Subsidiary on the Effective Date or becomes employed
with the Company or a Designated Subsidiary after the Effective Date and
is
otherwise an Eligible Employee, may participate in the Plan immediately
beginning with the first Offering Period that occurs concurrent with or next
following either the Effective Date or that individual’s initial date of such
employment.
3.02 Leave
of Absence
For
purposes of the Plan, an individual’s employment relationship is still
considered to be continuing intact while such individual is on sick leave,
or
other leave of absence approved by the Committee or the Participant’s
supervisor; provided,
however,
that if
the period of leave of absence exceeds ninety (90) days and the individual’s
right to reemployment is not guaranteed either by statute or by contract,
the
employment relationship shall be deemed to have terminated on the ninety-first
(91st)
day of
such leave.
3.03
Eligibility
Restrictions
Notwithstanding
any provisions of the Plan to the contrary, no employee of the Company or
a
Designated Subsidiary shall be granted an Option under the Plan:
(a)
|
if,
immediately after the Option is granted, applying the rules under
Section
424(d) of the Code to determine Common Stock ownership, such employee
would own, immediately after the Option is granted, five percent
(5%) or
more of the total combined voting power or value of all classes
of stock
of the Company or any Subsidiary; or
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(b)
|
which
permits such employee’s rights to purchase stock under the Plan and any
other employee stock purchase plans of the Company or any Subsidiary
to
accrue at a rate that exceeds $25,000 (or such other amount as
may be
adjusted from time to time under applicable provisions of the Code
or
Regs) in Fair Market Value of Common Stock (determined at the time
such
Option is granted) for each calendar year in which such Option
is
outstanding.
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3.04
Participation
(a) An
Eligible Employee may commence participation by completing an Agreement
authorizing payroll deductions and filing it with the payroll office of the
Company prior to the applicable Enrollment Date. Such an Eligible Employee
is
referred to as a Participant.
(b) Any
payroll deductions for a Participant shall commence on the first payroll
date
following the Enrollment Date and shall end on the last payroll date in the
Offering Period to which such authorization is applicable, unless sooner
terminated by the Participant as provided in Article VI.
3.05
Option
Grant
On
the
Enrollment Date of each Offering Period, each Participant participating in
the
Offering Period shall be granted an Option to purchase on the Exercise Date
of
such Offering Period (at the appropriate Option Price) up to a number of
shares
of Common Stock as determined by dividing the particular Participant’s payroll
deductions that have accumulated prior to such Exercise Date and retained
in
such Participant’s Account as of that Exercise Date by the appropriate Option
Price. Such purchase of shares of Common Stock shall be subject to the
limitations under Sections 3.03 and 3.09. Exercise of the Option shall occur
as
provided in Section 3.07, unless the Participant has withdrawn as provided
in
Article VI. The Option shall expire on the last day of the Offering Period.
The
Committee may determine that there shall be no Options granted under the
Plan
for any particular Plan Year.
3.06
Offering
Period
The
Plan
shall be implemented by consecutive Offering Periods of Common Stock. Each
Agreement shall specify the Offering Period for which the Option is granted,
which shall be determined by the Committee in accordance with the Plan. The
Committee shall have the authority to change the duration of Offering Periods,
including the commencement dates thereof, with respect to future offerings
without approval of the Company’s stockholders. Under such circumstances, any
change to the Offering Periods shall be announced at least ten (10) days
prior
to the scheduled beginning of the initial Offering Period to be affected.
In no
event, however, shall an Offering Period extend beyond the period permitted
under Section 423(b)(7) of the Code.
3.07
Exercise
of Option
Unless
a
Participant provides written notice to the Company, or withdraws from the
Plan
as provided in Article VI, his Option for the purchase of shares shall be
exercised automatically on the Exercise Date, and the maximum number of full
shares subject to the Option shall be purchased for such Participant at the
applicable Option Price, using the accumulated payroll deductions in his
Account, subject to the limitations under Sections 3.03 and 3.09. No fractional
shares shall be purchased. Any payroll deductions accumulated in an Account
that
are not sufficient to purchase a full share of Common Stock shall be retained
in
the Account for the subsequent Offering Period, subject to earlier withdrawal
by
the Participant as provided in Article VI. Any other monies remaining in
a
Participant’s Account after the Exercise Date shall be returned to the
Participant or his Beneficiary in cash, without interest. During a Participant’s
lifetime, such Participant’s Option is exercisable only by such
Participant.
3.08 Delivery
of Stock
(a) As
promptly as practical after each Exercise Date on which a purchase of Common
Stock occurs, the Company shall arrange the delivery to each Participant,
or his
Beneficiary, of a certificate representing the shares of Common Stock purchased
upon exercise of such Participant’s Option, except that the Committee may
determine that such shares shall be held for each Participant’s benefit by a
broker designated by the Committee unless the Participant has delivered to
the
Committee a written election that certificates representing such shares be
issued to him. Shares of Common Stock issued upon exercise of an Option and
delivered to or for the benefit of a Participant or Beneficiary will be
registered in the name of such Participant or Beneficiary, as the case may
be.
Alternatively, at the direction of a Participant through written notice to
the
Committee at least ten (10) days prior to the applicable Exercise Date, such
shares shall be registered in the names of such Participant and one other
person
as may be designated by the Participant, as joint tenants with rights of
survivorship, community property or as tenants by the entirety, to the extent
permitted by applicable law.
(b) The
Committee may require a Participant or his Beneficiary to give prompt written
notice to the Company concerning any disposition of shares of Common Stock
received upon the exercise of such Participant’s Option within: (i) two (2)
years from the date of granting of such Option to such Participant, (ii)
one (1)
year from the transfer of such shares of Common Stock to such Participant,
or
(iii) such other period as the Committee may from time to time determine.
3.09 Maximum
Number of Shares
In
no
event shall the number of shares of Common Stock that a Participant may purchase
during any one Offering Period under the Plan exceed the number of shares
determined by (a) multiplying twenty percent (20%) of the amount of the
Participant’s Compensation for the payroll period immediately preceding the date
he is first granted an Option for such Offering Period by the number of payroll
periods from such date to the end of such Offering Period, and (b) dividing
that
product by 85% of the Fair Market Value of a share of Common Stock on such
date.
3.10 Withholding
At
the
time an Option is exercised, or at the time some or all of the Common Stock
that
is issued under the Plan is disposed of, the Company may withhold from any
Compensation or other amount payable to the applicable Participant, or require
such Participant to remit to the Company (or make other arrangements
satisfactory to the Company, as determined in the Committee’s discretion,
regarding payment to the Company of), the amount necessary for the Company
to
satisfy any Federal, state or local taxes required by law to be withheld
with
respect to the shares of Common Stock subject to such Option or disposed
of, as
a condition to delivery of any certificate or certificates for any such shares
of Common Stock. Whenever under the Plan payments are to be made in cash,
such
payments shall be made net of an amount sufficient to satisfy any Federal,
state
or local tax or withholding obligations with respect to such
payments.
ARTICLE
IV
PAYROLL
DEDUCTIONS
4.01
Contribution
Rate
(a) At
the
time a Participant files an Agreement with the Committee authorizing payroll
deduction, he may elect to have payroll deductions made on each payday during
the Offering Period, and such Contribution Rate shall be a minimum of one
percent (1%) and a maximum of ten percent (10%) of the Participant’s
Compensation in effect on each payroll period during the Offering Period,
unless
the Committee determines otherwise in a manner applicable uniformly to all
Participants. The payroll deductions shall only be made in whole percentages
of
the Participant’s Compensation. Participants may not make any separate cash
payments outside payroll deductions under the Plan except as otherwise provided
in Section 5.04(d) in the event of a Change in Control.
(b) A
Participant may discontinue his participation in the Plan as provided in
Article
VI, or may elect to decrease the rate of his payroll deductions during the
Offering Period by filing a new Agreement with the Committee that authorizes
a
change in his Contribution Rate. Such election by the Participant to decrease
his Contribution Rate shall only be permitted once during each Offering Period.
The Committee may, in its discretion, in a fair and equitable manner, limit
the
number of Participants who change their Contribution Rate during any Offering
Period. Any such change in Contribution Rate accepted by the Committee shall
be
effective with the first full payroll period following ten (10) business
days
after the Committee’s receipt of the new Agreement authorizing the new
Contribution Rate, unless the Committee elects to process a change in the
Contribution Rate more quickly. A Participant’s authorization to change his
Contribution Rate shall remain in effect for successive Offering Periods
unless
terminated as provided in Article VI.
(c) Notwithstanding
the foregoing provisions of this Section 4.01, the Committee may decrease
a
Participant’s Contribution Rate, but not below zero percent, at any time during
an Offering Period to the extent necessary to comply with Section 423(b)(8)
of
the Code or Section 3.03 of the Plan. To the extent necessary in such case,
payroll deductions shall recommence at the rate provided in such Participant’s
Agreement at the beginning of the first Offering Period that is scheduled
to
begin in the following Plan Year, unless the Participant withdraws from the
Plan
in accordance with Article VI.
4.02 Participant
Account
All
payroll deductions made for a Participant shall be credited to his Account
under
the Plan.
4.03
Interest
No
interest shall accrue on the payroll deductions of a Participant under the
Plan.
In addition, no interest shall be paid on any and all money that is distributed
to a Participant, or his Beneficiary, pursuant to the provisions of Sections
6.01 and/or 6.03.
ARTICLE
V
COMMON
STOCK
5.01
Shares
Provided
(a) The
maximum number of shares of Common Stock that may be issued under the Plan
shall
be 2,000,000 shares. This number is subject to an adjustment upon any changes
in
capitalization of the Company as provided in Section 5.04.
(b) The
Committee may determine, in its sole discretion, to include in the number
of
shares of Common Stock available under the Plan any shares of Common Stock
that
cease to be subject to an Option or are forfeited or any shares subject to
an
Option that terminates without issuance of shares of Common Stock actually
being
made to the Participant.
(c) If
the
number of shares of Common Stock that Participants become entitled to purchase
under the Plan is greater than the shares of Common Stock offered in a
particular Offering Period or remaining available under the Plan, the available
shares of Common Stock shall be allocated by the Committee among such
Participants in such manner as the Committee determines is fair and
equitable.
5.02 Participant
Interest
The
Participant shall have no interest as a shareholder, including, without
limitation, voting or dividend rights, with respect to shares of Common Stock
covered by his Option until such Option has been exercised in accordance
with
the Plan and his Agreement.
5.03
Restriction
of Shares Upon Exercise
The
Committee may, in its discretion, require as conditions to the exercise of
any
Option that the shares of Common Stock reserved for issuance upon the exercise
of the Option shall have been duly listed upon a stock exchange, and that
either:
(a)
|
a
registration statement under the Securities Act with respect to
the shares
shall be effective, or
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(b)
|
the
Participant shall have represented at the time of purchase, in
form and
substance satisfactory to the Company, that it is his intention
to
purchase the shares for investment and not for resale or
distribution.
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5.04
Changes
in Capital
(a) Subject
to any required action by the shareholders of the Company, upon changes in
the
outstanding Common Stock by reason of a stock split, reverse stock split,
stock
dividend, combination or exchange of shares, merger, recapitalization,
consolidation, corporate separation or division of the Company (including,
but
not limited to, a split-up, spin-off, split-off or distribution to Company
stockholders other than a normal cash dividend), reorganization,
reclassification, or increase or decrease in the number of shares of capital
stock of the Company effected without receipt of full consideration therefor,
or
any other similar change affecting the Company’s capital structure, the
Committee shall make appropriate adjustments, in its discretion, to, or
substitute, as applicable, the number, class and kind of shares of stock
available for Options under the Plan, outstanding Options and the Reserves,
the
maximum number of shares that a Participant may purchase per Offering Period,
the Option Prices of outstanding Options and any other characteristics or
terms
of the Options or the Plan as the Committee shall determine are necessary
or
appropriate to reflect equitably the effects of such changes to the
Participants; provided,
however,
that
any fractional shares resulting from any such adjustment shall be eliminated
by
rounding to the next lower whole number of shares with appropriate payment
for
such fractional shares as shall be reasonably determined by the Committee.
Notice of any such adjustment shall be given by the Committee to each
Participant whose Option has been adjusted and such adjustment, whether or
not
such notice has been given, shall be effective and binding for all purposes
of
the Plan.
(b) The
existence of the Plan and any Options granted hereunder shall not affect
in any
way the right or power of the Board or the shareholders of the Company to
make
or authorize any adjustment, recapitalization, reorganization or other change
in
the Company’s capital structure or its business, any merger or consolidation of
the Company or a Subsidiary, any issue of debt, preferred or prior preference
stock ahead of or affecting Common Stock, the authorization or issuance of
additional shares of Common Stock, the dissolution or liquidation of the
Company
or any Subsidiary, any sale or transfer of all or part of the Company’s or a
Subsidiary’s assets or business or any other corporate act or
proceeding.
(c) The
Board
may at any time terminate an Offering Period then in progress and provide,
in
its discretion, that Participants’ then outstanding Account balances shall be
used to purchase shares pursuant to Article III or returned to the applicable
Participants.
(d) In
the
event of a Change in Control, the Committee may, in its discretion:
(i)
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permit
each Participant to make a single sum payment with respect to his
outstanding Option before the Exercise Date equal to the amount
the
Participant would have contributed as determined by the Committee
for the
payroll periods remaining until the Exercise Date, and provide
for
termination of the Offering Period then in progress and purchase
of shares
pursuant to Article III; or
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(ii)
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provide
for payment in cash to each Participant of the amount standing
to his
Account plus an amount equal to the highest value of the consideration
to
be received in connection with such transaction for one share of
Common
Stock, or, if higher, the highest Fair Market Value of the Common
Stock
during the 30 consecutive Trading Days immediately prior to the
closing
date or expiration date of such transaction, less the Option Price
of the
Participant’s Option (determined for all purposes of this Section
5.04(d)(ii) using such closing or termination date as the Exercise
Date in
applying Section 2.23), multiplied by the number of full shares
of Common
Stock that could have been purchased for such Participant immediately
prior to the Change in Control with the amount standing to his
Account at
the Option Price, and that all Options so paid shall
terminate.
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ARTICLE
VI
WITHDRAWAL
6.01 General
By
written notice to the Committee, at any time prior to the last day of any
particular Offering Period, a Participant may elect to withdraw all of the
accumulated payroll deductions in his Account at such time. All of the
accumulated payroll deductions credited to such withdrawing Participant’s
Account shall be paid to such Participant promptly after receipt of his written
notice of withdrawal. In addition, upon the Participant’s written notice of
withdrawal, the Participant’s Option for the Offering Period shall be
automatically terminated, and no further payroll deductions for the purchase
of
shares on behalf of such Participant shall be made for such Offering Period.
If
a Participant withdraws from an Offering Period, payroll deductions shall
not
resume at the beginning of the succeeding Offering Period unless the Participant
delivers to the Committee a new Agreement authorizing payroll
deductions.
6.02 Effect
on Subsequent Participation
A
Participant’s withdrawal from an Offering Period shall not have any effect upon
his eligibility to participate in any similar plan that may hereafter be
adopted
by the Company or a Subsidiary or in succeeding Offering Periods that commence
after the termination of the Offering Period from which the Participant
withdraws.
6.03
Termination
of Employment
Upon
termination of employment as an Eligible Employee, for any reason, a Participant
shall be deemed to have elected to withdraw from the Plan and the payroll
deductions credited to such Participant’s Account during the Offering Period but
not yet used to exercise the Option shall be returned to such Participant,
or,
in the case of a Participant’s death, the payroll deductions credited to such
deceased Participant’s Account shall be paid to his Beneficiary or
Beneficiaries, and the Participant’s Option shall be automatically terminated. A
transfer of a Participant’s employment between or among the Company and any
Designated Subsidiary or Designated Subsidiaries shall not be treated as
a
termination of employment for purposes of the Plan.
ARTICLE
VII
ADMINISTRATION
7.01
Generally
The
Plan
shall be administered by a committee the members of which are appointed by
the
Board. The Committee shall consist of no fewer than three (3) members.
Notwithstanding the foregoing, the Board, in its absolute discretion, may
at any
time and from time to time exercise any and all rights, duties and
responsibilities of the Committee under the Plan, including, but not limited
to,
establishing procedures to be followed by the Committee, except with respect
to
any matters which under any applicable law, regulation or rule are required
to
be determined in the sole discretion of the Committee. If and to the extent
that
no Committee exists which has the authority to administer the Plan, the
functions of the Committee shall be exercised by the Board. In addition,
the
Board shall have discretionary authority to designate, from time to time,
without approval of the Company’s stockholders, those Subsidiaries that shall be
Designated Subsidiaries, the employees of which are eligible to participate
in
the Plan.
7.02
Authority
of the Committee
The
Committee shall have all authority that may be necessary or helpful to enable
it
to discharge its responsibilities with respect to the Plan. Without limiting
the
generality of the foregoing sentence or Section 7.01, subject to the express
provisions of the Plan, the Committee shall have full and exclusive
discretionary authority to interpret and construe any and all provisions
of the
Plan and any Agreements, determine eligibility to participate in the Plan,
adopt
rules and regulations for administering the Plan, adjudicate and determine
all
disputes arising under or in connection with the Plan, determine whether
a
particular item is included in “Compensation,” and make all other determinations
deemed necessary or advisable for administering the Plan. Decisions, actions
and
determinations by the Committee with respect to the Plan or any Agreement
shall
be final, conclusive and binding on all parties. Except to the extent prohibited
by applicable law or the rules of a stock exchange, the Committee may, in
its
discretion, from time to time, delegate all or any part of its responsibilities
and powers under the Plan to any member or members of the management of the
Company, and revoke any such delegation.
7.03
Appointment
The
Board
may from time to time appoint members to the Committee in substitution for
or in
addition to members previously appointed and may fill vacancies, however
caused,
on the Committee. The Committee may select one member as its Chair and shall
hold its meetings at such times and places as it shall deem advisable. It
may
also hold telephonic meetings. A majority of its members shall constitute
a
quorum. All determinations of the Committee shall be made by a majority of
its
members. The Committee may correct any defect or omission or reconcile any
inconsistency in the Plan or any Agreement in the manner and to the extent
the
Committee determines to be desirable. Any decision or determination reduced
to
writing and signed by a majority of the members of the Committee shall be
as
fully effective as if it had been made by a majority vote at a meeting duly
called and held. The Committee may appoint a secretary and shall make such
rules
and regulations for the conduct of its business as it shall deem
advisable.
ARTICLE
VIII
MISCELLANEOUS
8.01
Designation
of Beneficiary
(a) A
Participant may file with the Committee a written designation of a Beneficiary
who is to receive any Common Stock and/or cash from the Participant’s Account in
the event of such Participant’s death subsequent to an Exercise Date on which
the Option is exercised but prior to delivery to such Participant of such
Common
Stock and cash. Unless a Participant’s written Beneficiary designation states
otherwise, the designated Beneficiary shall also be entitled to receive any
cash
from the Participant’s Account in the event of such Participant’s death prior to
exercise of his Option.
(b) A
Participant’s designation of Beneficiary may be changed by the Participant at
any time by written notice to the Committee. In the event of the death of
a
Participant and in the absence of a valid Beneficiary designation under the
Plan
at the time of such Participant’s death, the Company shall deliver the shares
and/or cash to which the deceased Participant was entitled under the Plan
to the
executor or administrator of the estate of such Participant. If no such executor
or administrator has been appointed as can be determined by the Committee,
the
Company shall deliver such shares and/or cash to the spouse or to any one
or
more dependents or relatives of the Participant, or if no spouse, dependent
or
relative is known to the Company, then to such other person as the Committee
may
designate. Any such delivery or payment shall be a complete discharge of
the
obligations and liabilities of the Company, the Subsidiaries, the Committee
and
the Board under the Plan.
8.02
Transferability
Neither
payroll deductions credited to the Participant’s Account nor any rights with
regard to the exercise of an Option or to receive Common Stock under the
Plan
may be assigned, transferred, pledged, or otherwise disposed of in any way
other
than by will, the laws of descent and distribution, or as provided under
Section
8.01. Any such attempt at assignment, transfer, pledge or other disposition
shall be without effect, except that the Company may treat such act as an
election to withdraw funds from an Offering Period in accordance with Article
VI.
8.03 Conditions
Upon Issuance of Shares
(a) If
at any
time the Committee shall determine, in its discretion, that the listing,
registration and/or qualification of shares of Common Stock upon any securities
exchange or under any state or Federal law, or the consent or approval of
any
governmental regulatory body, is necessary or desirable as a condition of,
or in
connection with, the sale or purchase of shares of Common Stock hereunder,
no
Option may be exercised or paid in whole or in part unless and until such
listing, registration, qualification, consent and/or approval shall have
been
effected or obtained, or otherwise provided for, free of any conditions not
acceptable to the Committee.
(b) If
at any
time counsel to the Company shall be of the opinion that any sale or delivery
of
shares of Common Stock pursuant to an Option is or may be in the circumstances
unlawful, contravene the requirements of any stock exchange, or result in
the
imposition of excise taxes on the Company or any Subsidiary under the statutes,
rules or regulations of any applicable jurisdiction, the Company shall have
no
obligation to make such sale or delivery, or to make any application or to
effect or to maintain any qualification or registration under the Securities
Act, or otherwise with respect to shares of Common Stock or Options and the
right to exercise any Option shall be suspended until, in the opinion of
such
counsel, such sale or delivery shall be lawful or will not result in the
imposition of excise taxes on the Company or any Subsidiary.
(c) The
Committee, in its absolute discretion, may impose such restrictions on the
ownership and transferability of the shares of Common Stock purchasable or
otherwise receivable by any person under any Option as it deems appropriate.
The
certificates evidencing such shares may include any legend that the Committee
deems appropriate to reflect any such restrictions.
8.04 Participants
Bound by Plan
By
accepting any benefit under the Plan, each Participant and each person claiming
under or through such Participant shall be conclusively deemed to have indicated
their acceptance and ratification of, and consent to, all of the terms and
conditions of the Plan and any action taken under the Plan by the Committee,
the
Company or the Board, in any case in accordance with the terms and conditions
of
the Plan.
8.05 Use
of Funds
All
payroll deductions received or held by the Company under the Plan may be
used by
the Company for any corporate purpose, and the Company shall not be obligated
to
segregate such payroll deductions.
8.06
Amendment
or Termination
The
Board
may terminate, discontinue, amend or suspend the Plan at any time, with or
without notice to Participants. No such termination or amendment of the Plan
may
materially adversely affect the existing rights of any Participant with respect
to any outstanding Option previously granted to such Participant, without
the
consent of such Participant, except for any amendment or termination permitted
by Section 5.04. In addition, no amendment of the Plan by the Board shall,
without the approval of the shareholders of the Company, (i) increase the
maximum number of shares that may be issued under the Plan or that any
Participant may purchase under the Plan in any Offering Period, except pursuant
to Section 5.04; (ii) change the class of employees eligible to receive Options
under the Plan, except as provided by the Board pursuant to the last sentence
of
Section 7.01; or (iii) change the formula by which the Option Price is
determined under the Plan.
8.07
No
Employment Rights
The
Plan
does not, either directly or indirectly, create an independent right for
the
benefit of any employee or class of employees to purchase any shares of Common
Stock under the Plan. In addition, the Plan does not create in any employee
or
class of employees any right with respect to continuation of employment by
the
Company or any Subsidiary, and the Plan shall not be deemed to interfere
in any
way with the Company’s or any Subsidiary’s employment at will relationship with
the employee and/or interfere in any way with the Company’s or any Subsidiary’s
right to terminate, or otherwise modify, an employee’s employment at any time or
for any or no reason.
8.08
Indemnification
No
current or previous member of the Board, or the Committee, nor any officer
or
employee of the Company acting on behalf of the Board, or the Committee,
shall
be personally liable for any action, determination, or interpretation taken
or
made in good faith with respect to the Plan. All such members of the Board
or
the Committee and each and every officer or employee of the Company acting
on
their behalf shall, to the extent permitted by law, be fully indemnified
and
protected by the Company in respect of any such action, determination or
interpretation of the Plan. The foregoing right of indemnification shall
not be
exclusive of any other rights of indemnification to which such individuals
may
be entitled under the Company’s Certificate of Incorporation, or Bylaws, as a
matter of law or otherwise.
8.09
Construction
of Plan
Whenever
the context so requires, the masculine shall include the feminine and neuter,
and the singular shall also include the plural, and conversely. The words
“Article” and “Section” herein shall refer to provisions of the Plan, unless
expressly indicated otherwise.
8.10
Term
of Plan
Following
the adoption of the Plan by the Board, and approval of the Plan by the
shareholders of the Company who are present and represented at a special
or
annual meeting of the shareholders where a quorum is present, which approval
must occur not earlier than one (1) year before, and not later than one (1)
year
after, the date the Plan is adopted by the Board, the Plan shall become
effective on the Effective Date.
8.11 Unfunded
Status of Plan
The
Plan
shall be an unfunded plan.
The
Committee may authorize the creation of trusts or other arrangements to meet
the
obligations created under the Plan to deliver Common Stock or make payments,
provided
that the
existence of such trusts or other arrangements is consistent with the unfunded
status of the Plan.
8.12 Governing
Law
The
law
of the State of New Jersey will govern all matters relating to the Plan except
to the extent such law is superseded by the laws of the United
States.