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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 18, 2000
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EMCORE CORPORATION
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEW JERSEY 22-2746503
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(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
394 ELIZABETH AVENUE, SOMERSET, NEW JERSEY 08873
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
EMCORE CORPORATION
2000 STOCK OPTION PLAN
2000 EMPLOYEE STOCK PURCHASE PLAN
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(FULL TITLE OF THE PLANS)
THOMAS G. WERTHAN
EMCORE CORPORATION
394 ELIZABETH AVENUE
SOMERSET, NEW JERSEY 08873
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(NAME AND ADDRESS OF AGENT FOR SERVICE)
(732) 271-9090
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(TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPY TO:
JORGE L. FREELAND, ESQ.
WHITE & CASE LLP
200 SOUTH BISCAYNE BOULEVARD
SUITE 4900
MIAMI, FLORIDA 33131
(305) 371-2700
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CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED(1) SHARE(2) PRICE(2) REGISTRATION FEE
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2000 Stock Option Plan
Common Stock, without par value 725,000 shares $ 85.8125 $ 62,214,062.50 $ 16,424.52
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2000 Employee Stock Purchase Plan
Common Stock, without par value 500,000 shares $ 85.8125 $ 42,906,250.00 $ 11,327.25
TOTAL 1,225,000 shares $ 27,751.77
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(1) Plus an indeterminate number of additional shares of Common Stock that may
be offered and issued pursuant to stock dividends, stock splits or similar
transactions.
(2) Estimated pursuant to Rule 457(h) of the General Rules and Regulations
under the Securities Act of 1933, as amended (the "Securities Act"), for
the purpose of computing the registration fee, based on the average of the
high and low sales price on the Nasdaq National Market on May 15, 2000.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
EMCORE Corporation (the "Company" or "EMCORE") hereby incorporates by
reference the following documents:
(a) The Company's latest annual report on Form 10-K filed with the
Commission on December 29, 1999, as amended on January 13, 2000.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") since the end
of the Company's fiscal year 1999.
(c) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form S-3, as amended, as declared effective
by the Commission on February 4, 2000 (Reg. No. 333-94911).
In addition, all documents the Company filed pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the date of this
Registration Statement and prior to the filing of a post-effective amendment
that indicates that all securities offered herein have been sold or that
deregisters all securities then remaining unsold, shall be deemed to be
incorporated herein by reference and to be a part hereof from the respective
date of filing of each such document. Any statement contained in a document
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document that also is
incorporated or deemed to be incorporated herein by reference modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
EMCORE's Restated Certificate of Incorporation provides that the
Company shall indemnify its directors and officers to the full extent permitted
by New Jersey law.
Section 14A:2-7 of the New Jersey Business Corporation Act provides
that a New Jersey corporation's:
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"certificate of incorporation may provide that a director or officer
shall not be personally liable, or shall be liable only to the extent therein
provided, to the corporation or its shareholders for damages for breach of any
duty owed to the corporation or its shareholders, except that such provision
shall not relieve a director or officer from liability for any breach of duty
based upon an act or omission (a) in breach of such person's duty of loyalty to
the corporation or its shareholders, (b) not in good faith or involving a
knowing violation of law or (c) resulting in receipt by such person of an
improper personal benefit. As used in this subsection, an act or omission in
breach of a person's duty of loyalty means an act or omission which that person
knows or believes to be contrary to the best interests of the corporation or its
shareholders in connection with a matter in which he has a material conflict of
interest."
In addition, Section 14A:3-5 (1995) of the New Jersey Business
Corporation Act (1995), entitled "Indemnification of Directors, Officers and
Employees," provides as follows:
(1) As used in this section,
(a) "Corporate agent" means any person who is or was a
director, officer, employee or agent of the indemnifying corporation or
of any constituent corporation absorbed by the indemnifying corporation
in a consolidation or merger and any person who is or was a director,
officer, trustee, employee or agent of any other enterprise, serving as
such at the request of the indemnifying corporation, or of any such
constituent corporation, or the legal representative of any such
director, officer, trustee, employee or agent;
(b) "Other enterprise" means any domestic or foreign
corporation, other than the indemnifying corporation, and any
partnership, joint venture, sole proprietorship, trust or other
enterprise, whether or not for profit, served by a corporate agent;
(c) "Expenses" means reasonable costs, disbursements and
counsel fees;
(d) "Liabilities" means amounts paid or incurred in
satisfaction of settlements, judgments, fines and penalties;
(e) "Proceeding" means any pending, threatened or completed
civil, criminal, administrative or arbitrative action, suit or
proceeding, and any appeal therein and any inquiry or investigation
which could lead to such action, suit or proceeding; and
(f) References to "other enterprises" include employee benefit
plans; references to "fines" include any excise taxes assessed on a
person with respect to an employee benefit plan; and references to
"serving at the request of the indemnifying corporation" include any
service as a corporate agent which imposes duties on, or involves
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services by, the corporate agent with respect to an employee benefit
plan, its participants, or beneficiaries; and a person who acted in
good faith and in a manner the person reasonably believed to be in the
interest of the participants and beneficiaries of an employee benefit
plan shall be deemed to have acted in a manner "not opposed to the best
interests of the corporation" as referred to in this section.
(2) Any corporation organized for any purpose under any
general or special law of this State shall have the power to indemnify
a corporate agent against his expenses and liabilities in connection
with any proceeding involving the corporate agent by reason of his
being or having been such a corporate agent, other than a proceeding by
or in the right of the corporation, if
(a) Such corporate agent acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of
the corporation; and
(b) With respect to any criminal proceeding, such corporate
agent had no reasonable cause to believe his conduct was unlawful. The
termination of any proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent, shall
not of itself create a presumption that such corporate agent did not
meet the applicable standards of conduct set forth in paragraphs
14A:3-5(2)(a) and 14A:3-5(2)(b).
(3) Any corporation organized for any purpose under any
general or special law of this State shall have the power to indemnify
a corporate agent against his expenses in connection with any
proceeding by or in the right of the corporation to procure a judgment
in its favor which involves the corporate agent by reason for his being
or having been such corporate agent, if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the corporation. However, in such proceeding no
indemnification shall be provided in respect of any claim, issue or
matter as to which such corporate agent shall have been adjudged to be
liable to the corporation, unless and only to the extent that the
Superior Court or the court in which such proceeding was brought shall
determine upon application that despite the adjudication of liability,
but in view of all circumstances of the case, such corporate agent is
fairly and reasonably entitled to indemnity for such expenses as the
Superior Court or such other court shall deem proper.
(4) Any corporation organized for any purpose under any
general or special law of this State shall indemnify a corporate agent
against expenses to the extent that such corporate agent has been
successful on the merits or otherwise in any proceeding referred to in
subsections 14A:3-5(2) and 14A:3-5(3) or in defense of any claim, issue
or matter therein.
(5) Any indemnification under subsection 14A:3-5(2) and,
unless ordered by a court, under subsection 14A:3-5(3) may be made by
the corporation only as authorized in a specific case upon a
determination that indemnification is proper in the circumstances
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because the corporate agent met the applicable standard of conduct set
forth in subsection 14A:3-5(2) or subsection 14A:3-5(3). Unless
otherwise provided in the certificate of incorporation or bylaws, such
determination shall be made.
(a) By the board of directors or a committee thereof, acting
by a majority vote of a quorum consisting of directors who were not
parties to or otherwise involved in the proceeding; or
(b) If such a quorum is not obtainable, or, even if obtainable
and such quorum of the board of directors or committee by a majority
vote of the disinterested directors so directs, by independent legal
counsel, in a written opinion, such counsel to be designated by the
board of directors; or
(c) By the shareholders if the certificate of incorporation or
bylaws or a resolution of the board of directors or of the shareholders
so directs.
(6) Expenses incurred by a corporate agent in connection with
a proceeding may be paid by the corporation in advance of the final
disposition of the proceeding as authorized by the board of directors
upon receipt of an undertaking by or on behalf of the corporate agent
to repay such amount if it shall ultimately be determined that he is
not entitled to be indemnified as provided in this section.
(7)(a) If a corporation upon application of a corporate agent
has failed or refused to provide indemnification as required under
subsection 14A:3-5(4) or permitted under subsections 14A:3-5(2),
14A:3-5(3) and 14A:3-5(6), a corporate agent may apply to a court for
an award of indemnification by the corporation, and such court
(i) may award indemnification to the extent authorized under
subsections 14A:3-5(2) and 14A:3-5(3) and shall award indemnification
to the extent required under subsection 14A:3-5(4), notwithstanding any
contrary determination which may have been made under subsection
14A:3-5(5); and
(ii) may allow reasonable expenses to the extent authorized
by, and subject to the provisions of, subsection 14A:3-5(6), if the
court shall find that the corporate agent has by his pleadings or
during the course of the proceeding raised genuine issues of fact or
law.
(b) Application for such indemnification may be made:
(i) in the civil action in which the expenses were or are to
be incurred or other amounts were or are to be paid; or
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(ii) to the Superior Court in a separate proceeding. If the
application is for indemnification arising out of a civil action, it
shall set forth reasonable cause for the failure to make application
for such relief in the action or proceeding in which the expenses were
or are to be incurred or other amounts were or are to be paid.
The application shall set forth the disposition of any
previous application for indemnification and shall be made in such
manner and form as may be required by the applicable rules of court or,
in the absence thereof, by direction of the court to which it is made.
Such application shall be upon notice to the corporation. The court may
also direct that notice shall be given at the expense of the
corporation to the shareholders and such other persons as it may
designate in such manner as it may require.
(8) The indemnification and advancement of expenses provided
by or granted pursuant to the other subsections of this section shall
not exclude any other rights, including the right to be indemnified
against liabilities and expenses incurred in proceedings by or in the
right of the corporation, to which a corporate agent may be entitled
under a certificate of incorporation, bylaw, agreement, vote of
shareholders, or otherwise; provided that no indemnification shall be
made to or on behalf of a corporate agent if a judgment or other final
adjudication adverse to the corporate agent establishes that his acts
or omissions (a) were in breach of his duty of loyalty to the
corporation or its shareholders, as defined in subsection (3) of
N.J.S.14A:2-7, (b) were not in good faith or involved a knowing
violation of law or (c) resulted in receipt by the corporate agent of
an improper personal benefit.
(9) Any corporation organized for any purpose under any
general or special law of this State shall have the power to purchase
and maintain insurance on behalf of any corporate agent against any
expenses incurred in any proceeding and any liabilities asserted
against him by reason of his being or having been a corporate agent,
whether or not the corporation would have the power to indemnify him
against such expenses and liabilities under the provisions of this
section. The corporation may purchase such insurance from, or such
insurance may be reinsured in whole or in part by, an insurer owned by
or otherwise affiliated with the corporation, whether or not such
insurer does business with other insureds.
(10) The powers granted by this section may be exercised by
the corporation, notwithstanding the absence of any provision in its
certificate of incorporation or bylaws authorizing the exercise of such
powers.
(11) Except as required by subsection 14A:3-5(4), no
indemnification shall be made or expenses advanced by a corporation
under this section, and none shall be ordered by a court, if such
action would be inconsistent with a provision of the certificate of
incorporation, a bylaw, a resolution of the board of directors or of
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the shareholders, an agreement or other proper corporate action, in
effect at the time of the accrual of the alleged cause of action
asserted in the proceeding, which prohibits, limits or otherwise
conditions the exercise of indemnification powers by the corporation or
the rights of indemnification to which a corporate agent may be
entitled.
(12) This section does not limit a corporation's power to pay
or reimburse expenses incurred by a corporate agent in connection with
the corporate agent's appearance as a witness in a proceeding at a time
when the corporate agent has not been made a party to the proceeding.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
The following is a complete list of exhibits filed as part of this
Registration Statement:
EXHIBIT
NO. DESCRIPTION
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4.1 Specimen certificate for shares of Common Stock.(1)
4.2 The Company's 2000 Stock Option Plan, adopted by the Company's Board
of Directors and Shareholders on November 8, 1999 and February 16,
2000, respectively.(2)
4.3 The Company's 2000 Employee Stock Purchase Plan, adopted by the
Company's Board of Directors and Shareholders on November 8, 1999
and February 16, 2000, respectively.(2)
5.1 Opinion of White & Case LLP.(2)
23.1 Consent of White & Case LLP.(2)(3)
23.2 Consent of Deloitte & Touche LLP.(2)
(1) Filed as an Exhibit to the Company's Registration Statement on Form S-1,
No. 333-18565 and incorporated herein by reference.
(2) Filed herewith.
(3) Included in Exhibit 5.1.
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ITEM 9. UNDERTAKINGS.
(a) The Company hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of
the Registration Statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the Registration
Statement; and
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective
amendment shall be deemed to be a new Registration
Statement relating to the securities offered therein,
and the offering of such securities at that time
shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
(b) The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Securities and Exchange Commission
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such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer or controlling person of the Company in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Somerset, State of New Jersey, on this 18th day of
May, 2000.
EMCORE Corporation
By: /s/ Thomas G. Werthan
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Thomas G. Werthan
Vice President, Finance and Administration
and Chief Financial Officer
Pursuant to the requirements of the Securities Act, this Registration
Statement on Form S-8 has been signed by the following persons in the capacities
and on the date indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Thomas J. Russell Chairman of the Board of Directors May 18, 2000
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Thomas J. Russell
/s/ Reuben F. Richards, Jr. President, Chief Executive Officer and May 18, 2000
- ------------------------------------------- Director (Principal Executive Officer)
Reuben F. Richards, Jr.
/s/ Thomas G. Werthan Vice President, Chief Financial Officer, and May 18, 2000
- ------------------------------------------- Director
Thomas G. Werthan (Principal Accounting and Financial Officer)
/s/ Richard A. Stall
- ------------------------------------------- Director May 18, 2000
Richard A. Stall
/s/ Charles Scott Director May 18, 2000
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Charles Scott
/s/ Robert Louis-Dreyfus Director May 18, 2000
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Robert Louis-Dreyfus
/s/ Hugh H. Fenwick Director May 18, 2000
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Hugh H. Fenwick
/s/ Shigeo Takayama Director May 18, 2000
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Shigeo Takayama
/s/ John J. Hogan, Jr. Director May 18, 2000
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John J. Hogan, Jr.
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EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION
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4.2 The Company's 2000 Stock Option Plan, adopted by the Company's Board
of Directors and Shareholders on November 8, 1999 and February 16,
2000, respectively.
4.3 The Company's 2000 Employee Stock Purchase Plan, adopted by the
Company's Board of Directors and Shareholders on November 8, 1999
and February 16, 2000, respectively.
5.1 Opinion of White & Case LLP.
23.1 Consent of White & Case LLP (included in Exhibit 5.1 to this
Registration Statement).
23.2 Consent of Deloitte & Touche LLP.
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EXHIBIT 4.2
EMCORE CORPORATION
2000 STOCK OPTION PLAN
1. PURPOSES. The purposes of the Emcore Corporation 2000 Stock
Option Plan are to give officers and other employees, consultants and
non-employee directors of the Company and its Affiliates an opportunity to
acquire shares of Stock, to provide an incentive for such employees, consultants
and directors to continue to promote the best interests of the Company and its
Affiliates and enhance its long-term performance and to provide an incentive for
such employees, consultants and directors to join or remain with the Company and
its Affiliates. Toward these objectives, the Committee may grant Options to such
employees, directors and consultants, all pursuant to the terms and conditions
of the Plan.
2. DEFINITIONS. As used in the Plan, the following capitalized
terms shall have the meanings set forth below:
(a) "AFFILIATE" - other than the Company, (i) any corporation
or limited liability company in an unbroken chain of corporations or limited
liability companies ending with the Company if each corporation or limited
liability company owns stock or membership interests (as applicable) possessing
more than fifty percent (50%) of the total combined voting power of all classes
of stock in one of the other corporations or limited liability companies in such
chain; (ii) any corporation, trade or business (including, without limitation, a
partnership or limited liability company) which is more than fifty percent (50%)
controlled (whether by ownership of stock, assets or an equivalent ownership
interest or voting interest) by the Company or one of its Affiliates; or (iii)
any other entity, approved by the Committee as an Affiliate under the Plan, in
which the Company or any of its Affiliates has a material equity interest.
(b) "AGREEMENT" - a written stock option award agreement
evidencing an Option, as described in Section 3(e).
(c) "AWARD LIMIT" - 300,000 shares of Stock (as adjusted in
accordance with Section 10).
(d) "BENEFICIAL OWNERSHIP" - (including correlative terms)
shall have the same meaning given such term in Rule 13d-3 promulgated under the
Exchange Act.
(e) "BOARD" - the Board of Directors of the Company.
(f) "CHANGE IN CONTROL" - the occurrence of any of the
following:
(i) an acquisition in one transaction or a series of
related transactions (other than directly from the Company or pursuant
to Options granted under the Plan or other similar awards granted by
the Company) of any Voting Securities by any Person, immediately after
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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(f), Voting
Securities which are acquired in a Non-Control Acquisition shall not
constitute an acquisition that would cause a Change in Control;
(ii) 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
(iii) the consummation of:
(A) a merger, consolidation or reorganization
involving the Company UNLESS:
(1) 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,
(2) 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
(3) no Person, OTHER THAN (i) the Company,
(ii) any Related Entity (as defined in Section 2(p)),
(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
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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 (1) through (3)
above is referred to herein as a "NON-CONTROL
TRANSACTION");
(B) a complete liquidation or dissolution of the
Company; or
(C) 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. Solely for
purposes of this Section 2(f), (x) "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; (y) 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;
and (z) neither the Company nor any Person controlled by the
Company shall be deemed to be an Affiliate of any holder of
Common Stock.
(g) "CODE" - the Internal Revenue Code of 1986, as it may be
amended from time to time, including regulations and rules thereunder and
successor provisions and regulations and rules thereto.
(h) "COMMITTEE" - the Compensation Committee of the Board, or
such other Board committee as may be designated by the Board to administer the
Plan.
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(i) "COMPANY" - Emcore Corporation, a New Jersey corporation,
or any successor entity.
(j) "DISQUALIFIED OPTION" - the meaning given such term in
Section 10(d).
(k) "DISQUALIFYING DISPOSITION" - the meaning given such term
in Section 10(d).
(l) "EFFECTIVE DATE" - the date on which the Plan is
effective, as determined pursuant to Section 15.
(m) "EXCHANGE ACT" - the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
(n) "FAIR MARKET VALUE" - of a share of Stock as of a given
date shall be: (i) if the 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 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 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 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 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 Stock determined
by such other reasonable valuation method as the Committee shall, in its
discretion, select and apply in good faith as of the given date; PROVIDED,
HOWEVER, that for purposes of paragraphs (a) and (h) of Section 6, such fair
market value shall be determined subject to Section 422(c)(7) of the Code.
(o) "ISO" or "INCENTIVE STOCK OPTION" - a right to purchase
Stock granted to an Optionee under the Plan in accordance with the terms and
conditions set forth in Section 6 and which conforms to the applicable
provisions of Section 422 of the Code.
(p) "NON-CONTROL ACQUISITION" - an acquisition by (i) an
employee benefit plan (or a trust forming a part thereof) maintained by (A) the
Company or (B) 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"), (ii) the Company or any Related
Entity, (iii) any of Thomas Russell, The AER Trust 1997, Robert Louis-Dreyfus,
Gallium Enterprises, Inc. and Reuben Richards or (iv) any Person in connection
with a Non-Control Transaction.
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(q) "NOTICE" - written notice actually received by the Company
at its executive offices on the day of such receipt, if received on or before
1:30 p.m., on a day when the Company's executive offices are open for business,
or, if received after such time, such notice shall be deemed received on the
next such day, which notice may be delivered in person to the Company's
Secretary or sent by facsimile to the Company at (732) 302-9783, or sent by
certified or registered mail or overnight courier, prepaid, addressed to the
Company at 394 Elizabeth Avenue, Somerset, New Jersey 08873, Attention:
Secretary.
(r) "OPTION" - a right to purchase Stock granted to an
Optionee under the Plan in accordance with the terms and conditions set forth in
Section 6. Options may be either ISOs or stock options other than ISOs.
(s) "OPTIONEE" - an individual who is eligible, pursuant to
Section 5, and who has been selected, pursuant to Section 3(c), to participate
in the Plan, and who holds an outstanding Option granted to such individual
under the Plan in accordance with the terms and conditions set forth in Section
6.
(t) "PERSON" - "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.
(u) "PLAN" - this EMCORE Corporation 2000 Stock Option Plan.
(v) "PREDECESSOR PLAN" - the Company's 1995 Incentive and
Non-Statutory Stock Option Plan.
(w) "SECURITIES ACT" - the Securities Act of 1933, as it may
be amended from time to time, including the regulations and rules promulgated
thereunder and successor provisions and regulations and rules thereto.
(x) "STOCK" - the common stock of the Company, without par
value.
(y) "SUBSIDIARY" - any present or future corporation which is
or would be a "subsidiary corporation" of the Company as the term is defined in
Section 424(f) of the Code.
(z) "VOTING SECURITIES" - all the outstanding voting
securities of the Company entitled to vote generally in the election of the
Board.
3. ADMINISTRATION OF THE PLAN. (a) The Committee shall have
exclusive authority to operate, manage and administer the Plan in accordance
with its terms and conditions. Notwithstanding the foregoing, in its absolute
discretion, the Board 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, but
excluding matters which under any applicable law, regulation or rule, including,
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without limitation, any exemptive rule under Section 16 of the Exchange Act
(including Rule 16b-3, or any successor rule, as the same may be amended from
time to time) or Section 162(m) of the Code, 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.
(b) The Committee shall be appointed from time to time by the
Board, and the Committee shall consist of not less than three members of the
Board. Appointment of Committee members shall be effective upon their acceptance
of such appointment. Committee members may be removed by the Board at any time
either with or without cause, and such members may resign at any time by
delivering notice thereof to the Board. Any vacancy on the Committee, whether
due to action of the Board or any other reason, shall be filled by the Board.
(c) The Committee shall have full authority to grant, pursuant
to the terms of the Plan, Options to those individuals who are eligible to
receive Options under the Plan. In particular, the Committee shall have
discretionary authority, in accordance with the terms of the Plan, to: determine
eligibility for participation in the Plan; select, from time to time, from among
those eligible, the employees, directors and consultants to whom Options shall
be granted under the Plan, which selection may be based upon information
furnished to the Committee by the Company's or an Affiliate's management;
determine whether an Option shall take the form of an ISO or an Option other
than an ISO; determine the number of shares of Stock to be included in any
Option and the periods for which Options will be outstanding; establish and
administer any terms, conditions, performance criteria, restrictions,
limitations, forfeiture, vesting or exercise schedule, and other provisions of
or relating to any Option; grant waivers of terms, conditions, restrictions and
limitations under the Plan or applicable to any Option, or accelerate the
vesting or exercisability of any Option; amend or adjust the terms and
conditions of any outstanding Option and/or adjust the number and/or class of
shares of Stock subject to any outstanding Option; at any time and from time to
time after the granting of an Option, specify such additional terms, conditions
and restrictions with respect to any such Option as may be deemed necessary or
appropriate to ensure compliance with any and all applicable laws or rules,
including, but not limited to, terms, restrictions and conditions for compliance
with applicable securities laws, regarding an Optionee's exercise of Options by
tendering shares of Stock or under any "cashless exercise" program established
by the Committee, and methods of withholding or providing for the payment of
required taxes; offer to buy out an Option previously granted, based on such
terms and conditions as the Committee shall establish with and communicate to
the Optionee at the time such offer is made; and, to the extent permitted under
the applicable Agreement, permit the transfer of an Option or the exercise of an
Option by one other than the Optionee who received the grant of such Option
(other than any such a transfer or exercise which would cause any ISO to fail to
qualify as an "incentive stock option" under Section 422 of the Code).
(d) 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 3(a), and in addition to the powers otherwise expressly designated to
the Committee in the Plan, the Committee shall have the exclusive right and
discretionary authority to interpret the Plan and the Agreements; construe any
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ambiguous provision of the Plan and/or the Agreements and decide all questions
concerning eligibility for and the amount of Options granted under the Plan. The
Committee may establish, amend, waive and/or rescind rules and regulations and
administrative guidelines for carrying out the Plan and may correct any errors,
supply any omissions or reconcile any inconsistencies in the Plan and/or any
Agreement or any other instrument relating to any Options. The Committee shall
have the authority to adopt such procedures and subplans and grant Options on
such terms and conditions as the Committee determines necessary or appropriate
to permit participation in the Plan by individuals otherwise eligible to so
participate who are foreign nationals or employed outside of the United States,
or otherwise to conform to applicable requirements or practices of jurisdictions
outside of the United States; and take any and all such other actions it deems
necessary or advisable for the proper operation and/or administration of the
Plan. The Committee shall have full discretionary authority in all matters
related to the discharge of its responsibilities and the exercise of its
authority under the Plan. Decisions and actions by the Committee with respect to
the Plan and any Agreement shall be final, conclusive and binding on all persons
having or claiming to have any right or interest in or under the Plan and/or any
Agreement.
(e) Each Option shall be evidenced by an Agreement, which
shall be executed by the Company and the Optionee to whom such Option has been
granted, unless the Agreement provides otherwise; two or more Options granted to
a single Optionee may, however, be combined in a single Agreement. An Agreement
shall not be a precondition to the granting of an Option; no person shall have
any rights under any Option, however, unless and until the Optionee to whom the
Option shall have been granted (i) shall have executed and delivered to the
Company an Agreement or other instrument evidencing the Option, unless such
Agreement provides otherwise, and (ii) has otherwise complied with the
applicable terms and conditions of the Option. The Committee shall prescribe the
form of all Agreements, and, subject to the terms and conditions of the Plan,
shall determine the content of all Agreements. Any Agreement may be supplemented
or amended in writing from time to time as approved by the Committee; PROVIDED
that the terms and conditions of any such Agreement as supplemented or amended
are not inconsistent with the provisions of the Plan.
(f) A majority of the members of the entire Committee shall
constitute a quorum and the actions of a majority of the members of the
Committee in attendance at a meeting at which a quorum is present, or actions by
a written instrument signed by all members of the Committee, shall be the
actions of the Committee.
(g) The Committee may consult with counsel who may be counsel
to the Company. The Committee may, with the approval of the Board, employ such
other attorneys and/or consultants, accountants, appraisers, brokers and other
persons as it deems necessary or appropriate. In accordance with Section 12, the
Committee shall not incur any liability for any action taken in good faith in
reliance upon the advice of such counsel or other persons.
(h) In serving on the Committee, the members thereof shall be
entitled to indemnification as directors of the Company, and to any limitation
of liability and reimbursement as directors with respect to their services as
members of the Committee.
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(i) Except to the extent prohibited by applicable law,
including, without limitation, the requirements applicable under Section 162(m)
of the Code to any Option intended to be "qualified performance-based
compensation," or the requirements for any Option granted to an officer or
director to be covered by any exemptive rule under Section 16 of the Exchange
Act (including Rule 16b-3, or any successor rule, as the same may be amended
from time to time), or the applicable rules of a stock exchange, the Committee
may, in its discretion, allocate all or any portion of its responsibilities and
powers under this Section 3 to any one or more of its members and/or delegate
all or any part of its responsibilities and powers under this Section 3 to any
person or persons selected by it; PROVIDED, HOWEVER, that the Committee may not
delegate its authority to correct errors, omissions or inconsistencies in the
Plan. Any such authority delegated or allocated by the Committee under this
paragraph (i) of Section 3 shall be exercised in accordance with the terms and
conditions of the Plan and any rules, regulations or administrative guidelines
that may from time to time be established by the Committee, and any such
allocation or delegation may be revoked by the Committee at any time.
4. SHARES OF STOCK SUBJECT TO THE PLAN. (a) The shares of
stock subject to Options granted under the Plan shall be shares of Stock. Such
shares of Stock subject to the Plan may be either authorized and unissued shares
(which will not be subject to preemptive rights) or previously issued shares
acquired by the Company or any Subsidiary. The total number of shares of Stock
that may be delivered pursuant to Options granted under the Plan is 725,000,
plus any shares of Stock subject to a stock option granted under the Predecessor
Plan which for any reason expires or is terminated or canceled without having
been fully exercised by delivery of shares of Stock; PROVIDED, HOWEVER, that the
total number of shares of Stock that may be delivered pursuant to Incentive
Stock Options under the Plan is 725,000, without application of paragraph (d) of
this Section 4.
(b) Notwithstanding any of the foregoing limitations set forth
in this Section 4, the numbers of shares of Stock specified in this Section 4
shall be adjusted as provided in Section 10.
(c) Any shares of Stock subject to an Option which for any
reason expires or is terminated or canceled without having been fully exercised
by delivery of shares of Stock may again be granted pursuant to an Option under
the Plan, subject to the limitations of this Section 4.
(d) If the option exercise price of an Option granted under
the Plan or a stock option granted under the Predecessor Plan is paid by
tendering to the Company shares of Stock already owned by the holder of such
option (or such holder and his or her spouse jointly), only the number of shares
of Stock issued net of the shares of Stock so tendered shall be deemed delivered
for purposes of determining the total number of shares of Stock that may be
delivered under the Plan.
(e) Any shares of Stock delivered under the Plan in assumption
or substitution of outstanding stock options, or obligations to grant future
stock options, under plans or arrangements of an entity other than the Company
or an Affiliate in connection with the Company or an Affiliate acquiring such
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another entity, or an interest in such an entity, or a transaction otherwise
described in Section 6(j), shall not reduce the maximum number of shares of
Stock available for delivery under the Plan.
5. ELIGIBILITY. Executive employees and other employees,
including officers, of the Company and the Affiliates, directors (whether or not
also employees), and consultants of the Company and the Affiliates, shall be
eligible to become Optionees and receive Options in accordance with the terms
and conditions of the Plan, subject to the limitations on the granting of ISOs
set forth in Section 6(h).
6. TERMS AND CONDITIONS OF STOCK OPTIONS. All Options to
purchase Stock granted under the Plan shall be either ISOs or Options other than
ISOs. To the extent that any Option does not qualify as an Incentive Stock
Option (whether because of its provisions or the time or manner of its exercise
or otherwise), such Option, or the portion thereof which does not so qualify,
shall constitute a separate Option other than an Incentive Stock Option. Each
Option shall be subject to all the applicable provisions of the Plan, including
the following terms and conditions, and to such other terms and conditions not
inconsistent therewith as the Committee shall determine and which are set forth
in the applicable Agreement. Options need not be uniform as to all grants and
recipients thereof.
(a) The option exercise price per share of shares of Stock
subject to each Option shall be determined by the Committee and stated
in the Agreement; PROVIDED, HOWEVER, that, subject to paragraph
(h)(iii) and/or (j) of this Section 6, if applicable, such price
applicable to any ISO shall not be less than one hundred percent (100%)
of the Fair Market Value of a share of Stock at the time that the
Option is granted.
(b) Each Option shall be exercisable in whole or in such
installments, at such times and under such conditions as may be
determined by the Committee, in its discretion in accordance with the
Plan, and stated in the Agreement, and, in any event, over a period of
time ending not later than ten (10) years from the date such Option was
granted, subject to paragraph (h)(iii) of this Section 6.
(c) An Option shall not be exercisable with respect to a
fractional share of Stock or the lesser of one hundred (100) shares and
the full number of shares of Stock then subject to the Option. No
fractional shares of Stock shall be issued upon the exercise of an
Option.
(d) Each Option may be exercised by giving Notice to the
Company specifying the number of shares of Stock to be purchased, which
shall be accompanied by payment in full including applicable taxes, if
any, in accordance with Section 9. Payment shall be in any manner
permitted by applicable law and prescribed by the Committee, in its
discretion, and set forth in the Agreement, including, in the
Committee's discretion, and subject to such terms, conditions and
limitations as the Committee may prescribe, payment in accordance with
a "cashless exercise" arrangement established by the Committee and/or
in Stock owned by the Optionee or by the Optionee and his or her spouse
jointly and acquired more than six (6) months prior to such tender.
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(e) No Optionee or other person shall become the beneficial
owner of any shares of Stock subject to an Option, nor have any rights
to dividends or other rights of a shareholder with respect to any such
shares until he or she has exercised his or her Option in accordance
with the provisions of the Plan and the applicable Agreement.
(f) An Option may be exercised only if at all times during the
period beginning with the date of the granting of the Option and ending
on the date of such exercise, the Optionee was an employee, director or
consultant of the Company or an Affiliate, as applicable.
Notwithstanding the preceding sentence, the Committee may determine in
its discretion that an Option may be exercised prior to expiration of
such Option following termination of such continuous employment,
directorship or consultancy, whether or not exercisable at the time of
such termination, to the extent provided in the applicable Agreement.
(g) Subject to the terms and conditions and within the
limitations of the Plan, the Committee may modify, extend or renew
outstanding Options granted under the Plan, or accept the surrender of
outstanding Options (up to the extent not theretofore exercised) and
authorize the granting of new Options in substitution therefor (to the
extent not theretofore exercised).
(h) (i) Each Agreement relating to an Option shall state
whether such Option will or will not be treated as an ISO. No ISO shall
be granted unless such Option, when granted, qualifies as an "incentive
stock option" under Section 422 of the Code. No ISO shall be granted to
any individual otherwise eligible to participate in the Plan who is not
an employee of the Company or a Subsidiary on the date of granting of
such Option. Any ISO granted under the Plan shall contain such terms
and conditions, consistent with the Plan, as the Committee may
determine to be necessary to qualify such Option as an "incentive stock
option" under Section 422 of the Code. Any ISO granted under the Plan
may be modified by the Committee to disqualify such Option from
treatment as an "incentive stock option" under Section 422 of the Code.
(ii) Notwithstanding any intent to grant ISOs, an
Option granted under the Plan will not be considered an ISO to
the extent that it, together with any other "incentive stock
options" (within the meaning of Section 422 of the Code, but
without regard to subsection (d) of such Section) under the
Plan and any other "incentive stock option" plans of the
Company, any Subsidiary and any "parent corporation" of the
Company within the meaning of Section 424(e) of the Code, are
exercisable for the first time by any Optionee during any
calendar year with respect to Stock having an aggregate Fair
Market Value in excess of $100,000 (or such other limit as may
be required by the Code) as of the time the Option with
respect to such Stock is granted. The rule set forth in the
preceding sentence shall be applied by taking Options into
account in the order in which they were granted.
(iii) No ISO shall be granted to an individual
otherwise eligible to participate in the Plan who owns (within
the meaning of Section 424(d) of the Code), at the time the
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Option is granted, more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company
or a Subsidiary or any "parent corporation" of the Company
within the meaning of Section 424(e) of the Code. This
restriction does not apply if at the time such ISO is granted
the Option exercise price per share of Stock subject to the
Option is at least 110% of the Fair Market Value of a share of
Stock on the date such ISO is granted, and the ISO by its
terms is not exercisable after the expiration of five years
from such date of grant.
(i) An Option and any shares of Stock received upon the
exercise of an Option shall be subject to such other transfer and/or
ownership restrictions and/or legending requirements as the Committee
may establish in its discretion and which are specified in the
Agreement and may be referred to on the certificates evidencing such
shares of Stock. The Committee may require an Optionee to give prompt
Notice to the Company concerning any disposition of shares of Stock
received upon the exercise of an ISO within: (i) two (2) years from the
date of granting such ISO to such Optionee or (ii) one (1) year from
the transfer of such shares of Stock to such Optionee or (iii) such
other period as the Committee may from time to time determine. The
Committee may direct that an Optionee with respect to an ISO undertake
in the applicable Agreement to give such Notice described in the
preceding sentence, at such time and containing such information as the
Committee may prescribe, and/or that the certificates evidencing shares
of Stock acquired by exercise of an ISO refer to such requirement to
give such Notice.
(j) In the event that a transaction described in Section
424(a) of the Code involving the Company or a Subsidiary is
consummated, such as the acquisition of property or stock from an
unrelated corporation, individuals who become eligible to participate
in the Plan in connection with such transaction, as determined by the
Committee, may be granted Options in substitution for stock options
granted by another corporation that is a party to such transaction. If
such substitute Options are granted, the Committee, in its discretion
and consistent with Section 424(a) of the Code, if applicable, and the
terms of the Plan, though notwithstanding paragraph (a) of this Section
6, shall determine the option exercise price and other terms and
conditions of such substitute Options.
(k) Notwithstanding any other provision contained in the Plan
to the contrary, the maximum number of shares of Stock which may be
subject to Options granted under the Plan to any Optionee in any twelve
(12) month period shall not exceed the Award Limit. To the extent
required by Section 162(m) of the Code, shares of Stock subject to
Options which are canceled shall continue to be counted against the
Award Limit and if, after the grant of an Option, the price of shares
subject to such Option is reduced and the transaction is treated as a
cancellation of the Option and a grant of a new Option, both the Option
deemed to be canceled and the Option deemed to be granted shall be
counted against the Award Limit.
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7. TRANSFER, LEAVE OF ABSENCE. A transfer of an employee from
the Company to an Affiliate (or, for purposes of any ISO granted under the Plan,
a Subsidiary), or vice versa, or from one Affiliate to another (or in the case
of an ISO, from one Subsidiary to another), and a leave of absence, duly
authorized in writing by the Company or a Subsidiary or Affiliate, shall not be
deemed a termination of employment of the employee for purposes of the Plan or
with respect to any Option (in the case of ISOs, to the extent permitted by the
Code).
8. RIGHTS OF EMPLOYEES AND OTHER PERSONS. (a) No person shall
have any rights or claims under the Plan except in accordance with the
provisions of the Plan and the applicable Agreement.
(b) Nothing contained in the Plan or in any Agreement shall be
deemed to (i) give any employee or director the right to be retained in the
service of the Company or any Affiliate nor restrict in any way the right of the
Company or any Affiliate to terminate any employee's employment or any
director's directorship at any time with or without cause or (ii) confer on any
consultant any right of continued relationship with the Company or any
Affiliate, or alter any relationship between them, including any right of the
Company or an Affiliate to terminate its relationship with such consultant.
(c) The adoption of the Plan shall not be deemed to give any
employee of the Company or any Affiliate or any other person any right to be
selected to participate in the Plan or to be granted an Option.
(d) Nothing contained in the Plan or in any Agreement shall be
deemed to give any employee the right to receive any bonus, whether payable in
cash or in Stock, or in any combination thereof, from the Company or any
Affiliate, nor be construed as limiting in any way the right of the Company or
any Affiliate to determine, in its sole discretion, whether or not it shall pay
any employee bonuses, and, if so paid, the amount thereof and the manner of such
payment.
9. TAX WITHHOLDING OBLIGATIONS. (a) The Company and/or any
Affiliate are authorized to take whatever actions are necessary and proper to
satisfy all obligations of Optionees (including, for purposes of this Section 9,
any other person entitled to exercise an Option pursuant to the Plan or an
Agreement) for the payment of all Federal, state, local and foreign taxes in
connection with any Options (including, but not limited to, actions pursuant to
the following paragraph (b) of this Section 9).
(b) Each Optionee shall (and in no event shall Stock be
delivered to such Optionee with respect to an Option until), no later than the
date as of which the value of the Option first becomes includible in the gross
income of the Optionee for income tax purposes, pay to the Company in cash, or
make arrangements satisfactory to the Company, as determined in the Committee's
discretion, regarding payment to the Company of, any taxes of any kind required
by law to be withheld with respect to the Stock or other property subject to
such Option, and the Company and any Affiliate shall, to the extent permitted by
law, have the right to deduct any such taxes from any payment of any kind
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otherwise due to such Optionee. Notwithstanding the above, the Committee may, in
its discretion and pursuant to procedures approved by the Committee, permit the
Optionee to (i) elect withholding by the Company of Stock otherwise deliverable
to such Optionee pursuant to his or her Option (PROVIDED, HOWEVER, that the
amount of any Stock so withheld shall not exceed the amount necessary to satisfy
required Federal, state, local and foreign withholding obligations using the
minimum statutory rate) and/or (ii) tender to the Company Stock owned by such
Optionee (or by such Optionee and his or her spouse jointly) and acquired more
than six (6) months prior to such tender in full or partial satisfaction of such
tax obligations, based, in each case, on the Fair Market Value of the Stock on
the payment date as determined by the Committee.
10. CHANGES IN CAPITAL. (a) 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 stockholders 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 an
Affiliate, any issue of debt, preferred or prior preference stock ahead of or
affecting Stock, the authorization or issuance of additional shares of Stock,
the dissolution or liquidation of the Company or its Affiliates, any sale or
transfer of all or part of its assets or business or any other corporate act or
proceeding.
(b)(i) Upon changes in the outstanding Stock by reason of a
stock dividend, stock split, reverse stock split, subdivision, recapitalization,
reclassification, merger, consolidation (whether or not the Company is a
surviving corporation), combination or exchange of shares of Stock, separation,
or reorganization, or in the event of an extraordinary dividend, "spin-off,"
liquidation, other substantial distribution of assets of the Company or
acquisition of property or stock or other change in capital of the Company, or
the issuance by the Company of shares of its capital stock without receipt of
full consideration therefor, or rights or securities exercisable, convertible or
exchangeable for shares of such capital stock, or any similar change affecting
the Company's capital structure, the aggregate number, class and kind of shares
of stock available under the Plan as to which Options may be granted, the Award
Limit, and the number, class and kind of shares under each outstanding Option
and the exercise price per share applicable to any such Options shall be
appropriately adjusted by the Committee in its discretion to preserve the
benefits or potential benefits intended to be made available under the Plan or
with respect to any outstanding Options or otherwise necessary to reflect any
such change.
(ii) Fractional shares of Stock resulting from any
adjustment in Options pursuant to Section 10(b)(i) shall be aggregated
until, and eliminated at, the time of exercise of the affected Options.
Notice of any adjustment shall be given by the Committee to each
Optionee whose Option has been adjusted and such adjustment (whether or
not such Notice is given) shall be effective and binding for all
purposes of the Plan.
(c) In the event of a Change in Control:
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(i) Immediately prior thereto, all outstanding
Options shall be accelerated and become immediately exercisable as to
all of the shares of Stock covered thereby, notwithstanding anything to
the contrary in the Plan or the Agreement.
(ii) In its discretion, and on such terms and
conditions as it deems appropriate, the Committee may provide, either
by the terms of the Agreement applicable to any Option or by resolution
adopted prior to the occurrence of the Change in Control, that any
outstanding Option shall be adjusted by substituting for Stock subject
to such Option stock or other securities of the surviving corporation
or any successor corporation to the Company, or a parent or subsidiary
thereof, or that may be issuable by another corporation that is a party
to the transaction resulting in the Change in Control, whether or not
such stock or other securities are publicly traded, in which event the
aggregate exercise price shall remain the same and the amount of shares
or other securities subject to the Option shall be the amount of shares
or other securities which could have been purchased on the closing date
or expiration date of such transaction with the proceeds which would
have been received by the Optionee if the Option had been exercised in
full (or with respect to a portion of such Option, as determined by the
Committee, in its discretion) prior to such transaction or expiration
date and the Optionee exchanged all of such shares in the transaction.
(iii) In its discretion, and on such terms and
conditions as it deems appropriate, the Committee may provide, either
by the terms of the Agreement applicable to any Option or by resolution
adopted prior to the occurrence of the Change in Control, that any
outstanding Option shall be converted into a right to receive cash on
or following the closing date or expiration date of the transaction
resulting in the Change in Control in an amount equal to the highest
value of the consideration to be received in connection with such
transaction for one share of Stock, or, if higher, the highest Fair
Market Value of the Stock during the thirty (30) consecutive business
days immediately prior to the closing date or expiration date of such
transaction, less the per share exercise price of such Option,
multiplied by the number of shares of Stock subject to such Option, or
a portion thereof.
(iv) The Committee may, in its discretion, provide
that an Option cannot be exercised after such a Change in Control, to
the extent that such Option is or becomes fully exercisable on or
before such Change in Control or is subject to any acceleration,
adjustment or conversion in accordance with the foregoing paragraphs
(i), (ii) or (iii) of this Section 10.
No Optionee shall have any right to prevent the consummation
of any of the foregoing acts affecting the number of shares of Stock available
to such Optionee. Any actions or determinations of the Committee under this
subsection 10(c) need not be uniform as to all outstanding Options, nor treat
all Optionees identically. Notwithstanding the foregoing adjustments, in no
event may any Option be exercised after ten (10) years from the date it was
originally granted, and any changes to ISOs pursuant to this Section 10 shall,
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unless the Committee determines otherwise, only be effective to the extent such
adjustments or changes do not cause a "modification" (within the meaning of
Section 424(h)(3) of the Code) of such ISOs or adversely affect the tax status
of such ISOs.
(d) If, as a result of a Change in Control transaction, an ISO
fails to qualify as an "incentive stock option," within the meaning of Section
422 of the Code, either because of the failure of the Optionee to meet the
holding period requirements of Code Section 422(a)(1) (a "Disqualifying
Disposition") or the exercisability of such Option is accelerated pursuant to
Section 10(c)(i), or any similar provision of the applicable Agreement, in
connection with such Change in Control and such acceleration causes the
aggregate Fair Market Value (determined at the time the Option is granted) of
the shares of Stock with respect to which such Option, together with any other
"incentive stock options," as provided in Section 6(h)(ii), are exercisable for
the first time by such Optionee during the calendar year in which such
accelerated exercisability occurs to exceed the limitations set forth in Section
6(h)(ii) (a "Disqualified Option"); or any other exercise, payment,
acceleration, adjustment or conversion of an Option in connection with a Change
in Control transaction results in any additional taxes imposed on an Optionee,
then the Company may, in the discretion of the Committee, make a cash payment to
or on behalf of the Optionee who holds any such Option equal to the amount that
will, after taking into account all taxes imposed on the Disqualifying
Disposition or other exercise, payment, acceleration, adjustment or conversion
of the Option, as the case may be, and the receipt of such payment, leave such
Optionee in the same after-tax position the Optionee would have been in had the
Code Section 422(a)(1) holding period requirements been met at the time of the
Disqualifying Disposition or had the Disqualified Option continued to qualify as
an "incentive stock option," within the meaning of Code Section 422 on the date
of such exercise or otherwise equalize the Optionee for any such taxes;
PROVIDED, HOWEVER, that the amount, timing and recipients of any such payment or
payments shall be subject to such terms, conditions and limitations as the
Committee shall, in its discretion, determine. Without limiting the generality
of the PROVISO contained in the immediately preceding sentence, in determining
the amount of any such payment or payments referred to therein, the Committee
may adopt such methods and assumptions as it considers appropriate, and the
Committee shall not be required to examine or take into account the individual
tax liability of any Optionee.
11. MISCELLANEOUS PROVISIONS. (a) The Plan shall be unfunded.
The Company shall not be required to establish any special or separate fund or
to make any other segregation of assets to assure the issuance of shares of
Stock or the payment of cash upon exercise or payment of any Option. Proceeds
from the sale of shares of Stock pursuant to Options granted under the Plan
shall constitute general funds of the Company.
(b) Except as otherwise provided in this paragraph (b) of
Section 11 or by the Committee, an Option by its terms shall be personal and may
not be sold, transferred, pledged, assigned, encumbered or otherwise alienated
or hypothecated otherwise than by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of an Optionee only by
him or her. An Agreement may permit the exercise or payment of an Optionee's
Option (or any portion thereof) after his or her death by or to the beneficiary
most recently named by such Optionee in a written designation thereof filed with
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the Company, or, in lieu of any such surviving beneficiary, as designated by the
Optionee by will or by the laws of descent and distribution. In the event any
Option is exercised by the executors, administrators, heirs or distributees of
the estate of a deceased Optionee, or such an Optionee's beneficiary, or the
transferee of an Option, in any such case pursuant to the terms and conditions
of the Plan and the applicable Agreement and in accordance with such terms and
conditions as may be specified from time to time by the Committee, the Company
shall be under no obligation to issue Stock thereunder unless and until the
Committee is satisfied that the person or persons exercising such Option is the
duly appointed legal representative of the deceased Optionee's estate or the
proper legatee or distributee thereof or the named beneficiary of such Optionee,
or the valid transferee of such Option, as applicable.
(c) (i) If at any time the Committee shall determine, in its
discretion, that the listing, registration and/or qualification of shares of
Stock upon any securities exchange or under any state, Federal or foreign 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 Stock hereunder, no Option may be granted, 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.
(ii) If at any time counsel to the Company shall be of the
opinion that any sale or delivery of shares of Stock pursuant to an
Option is or may be in the circumstances unlawful or result in the
imposition of excise taxes on the Company or any Affiliate 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 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 Affiliate.
(iii) Upon termination of any period of suspension under this
Section 11(c), any Option affected by such suspension which shall not
then have expired or terminated shall be reinstated as to all shares
available before such suspension and as to the shares which would
otherwise have become available during the period of such suspension,
but no suspension shall extend the term of any Option.
(d) The Committee may require each person receiving Stock in
connection with any Option under the Plan to represent and agree with the
Company in writing that such person is acquiring the shares of Stock for
investment without a view to the distribution thereof. The Committee, in its
absolute discretion, may impose such restrictions on the ownership and
transferability of the shares of Stock purchasable or otherwise receivable by
any person under any Option as it deems appropriate. Any such restrictions shall
be set forth in the applicable Agreement, and the certificates evidencing such
shares may include any legend that the Committee deems appropriate to reflect
any such restrictions.
(e) By accepting any benefit under the Plan, each Optionee and
each person claiming under or through such Optionee shall be conclusively deemed
to have indicated their acceptance and ratification of, and consent to, all of
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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.
(f) In the discretion of the Committee, an Optionee may elect
irrevocably (at a time and in a manner determined by the Committee) prior to
exercising an Option that delivery of shares of Stock upon such exercise shall
be deferred until a future date and/or the occurrence of a future event or
events, specified in such election. Upon the exercise of any such Option and
until the delivery of any deferred shares, the number of shares otherwise
issuable to the Optionee shall be credited to a memorandum account in the
records of the Company or its designee and any dividends or other distributions
payable on such shares shall be deemed reinvested in additional shares of Stock,
in a manner determined by the Committee, until all shares of Stock credited to
such Optionee's memorandum account shall become issuable pursuant to the
Optionee's election.
(g) The Committee may, in its discretion, extend one or more
loans to Optionees who are directors, key employees or consultants of the
Company or an Affiliate in connection with the exercise or receipt of an Option
granted to any such individual. The terms and conditions of any such loan shall
be established by the Committee.
(h) Except with respect to Incentive Stock Options granted
under the Predecessor Plan (within the meaning of the Predecessor Plan) and
outstanding on the Effective Date, subject to approval of the Plan by the
Company's shareholders, in accordance with Section 15, the provisions of the
Plan shall apply to and govern all stock options granted under the Predecessor
Plan and, unless otherwise determined by the Committee, such stock options
granted under the Predecessor Plan shall be deemed to be amended to provide any
additional rights applicable to Options hereunder, subject to the right of any
affected participant in the Predecessor Plan to refuse to consent to such
amendment pursuant to the terms and conditions of the Predecessor Plan and the
applicable option or award agreement between the Company and such participant.
(i) Neither the adoption of the Plan nor anything contained
herein shall affect any other compensation or incentive plans or arrangements of
the Company or any Affiliate (other than the Predecessor Plan, as provided in
paragraph (h) of this Section 11), or prevent or limit the right of the Company
or any Affiliate to establish any other forms of incentives or compensation for
their directors, employees or consultants or grant or assume options or other
rights otherwise than under the Plan.
(j) The Plan shall be governed by and construed in accordance
with the laws of the State of New Jersey, without regard to such state's
conflict of law provisions, and, in any event, except as superseded by
applicable Federal law.
(k) The words "Section," "subsection" and "paragraph" herein
shall refer to provisions of the Plan, unless expressly indicated otherwise.
Wherever any words are used in the Plan or any Agreement in the masculine gender
they shall be construed as though they were also used in the feminine gender in
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all cases where they would so apply, and wherever any words are used herein in
the singular form they shall be construed as though they were also used in the
plural form in all cases where they would so apply.
(l) The Company shall bear all costs and expenses incurred in
administering the Plan, including expenses of issuing Stock pursuant to any
Options granted hereunder.
12. LIMITS OF LIABILITY. (a) Any liability of the Company or
an Affiliate to any Optionee with respect to any Option shall be based solely
upon contractual obligations created by the Plan and the Agreement.
(b) None of the Company, any Affiliate, any member of the
Committee or the Board or any other person participating in any determination of
any question under the Plan, or in the interpretation, administration or
application of the Plan, shall have any liability, in the absence of bad faith,
to any party for any action taken or not taken in connection with the Plan,
except as may expressly be provided by statute.
13. LIMITATIONS APPLICABLE TO CERTAIN OPTIONS SUBJECT TO
EXCHANGE ACT SECTION 16 AND CODE SECTION 162(m). Unless stated otherwise in the
Agreement, notwithstanding any other provision of the Plan, any Option granted
to an officer or director of the Company who is then subject to Section 16 of
the Exchange Act, shall be subject to any additional limitations set forth in
any applicable exemptive rule under Section 16 of the Exchange Act (including
Rule 16b-3, or any successor rule, as the same may be amended from time to time)
that are requirements for the application of such exemptive rule, and the Plan
and applicable Agreement shall be deemed amended to the extent necessary to
conform to such limitations. Furthermore, unless stated otherwise in the
Agreement, notwithstanding any other provision of the Plan, any Option granted
to an employee of the Company or an Affiliate intended to qualify as "other
performance-based compensation" as described in Section 162(m)(4)(C) of the Code
shall be subject to any additional limitations set forth in Section 162(m) of
the Code or any regulations or rulings issued thereunder (including any
amendment to any of the foregoing) that are requirements for qualification as
"other performance-based compensation" as described in Section 162(m)(4)(C) of
the Code, and the Plan and applicable Agreement shall be deemed amended to the
extent necessary to conform to such requirements.
14. AMENDMENTS AND TERMINATION. The Board may, at any time and
with or without prior notice, amend, alter, suspend or terminate the Plan,
retroactively or otherwise; PROVIDED, HOWEVER, unless otherwise required by law
or specifically provided herein, no such amendment, alteration, suspension or
termination shall be made which would impair the previously accrued rights of
any holder of an Option theretofore granted without his or her written consent,
or which, without first obtaining approval of the stockholders of the Company
(where such approval is necessary to satisfy (i) any applicable requirements
under the Code relating to ISOs or for exemption from Section 162(m) of the
Code; (ii) the then-applicable requirements of Rule 16b-3 promulgated under the
Exchange Act, or any successor rule, as the same may be amended from time to
time; or (iii) any other applicable law, regulation or rule), would:
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(a) except as is provided in Section 10, increase the
maximum number of shares of Stock which may be sold
or awarded under the Plan or increase the limitations
set forth in Section 6(k) on the maximum of shares of
Stock that may be subject to Options granted to an
Optionee;
(b) except as is provided in Section 10, decrease the
minimum option exercise price requirements of Section
6(a);
(c) change the class of persons eligible to receive
Options under the Plan; or
(d) extend the duration of the Plan or the period during
which Options may be exercised under Section 6(b).
The Committee may amend the terms of any Option theretofore
granted, including any Agreement, retroactively or prospectively, but no such
amendment shall materially impair the previously accrued rights of any Optionee
without his or her written consent.
15. DURATION. Following the adoption of the Plan by the Board,
the Plan shall become effective as of the date on which it is approved by the
holders of a majority of the Company's outstanding Stock which is present and
voted at a meeting, or by written consent in lieu of a meeting (the "Effective
Date"), which approval must occur within the period ending twelve (12) months
after the date the Plan is adopted by the Board. The Plan shall terminate upon
the earliest to occur of:
(a) the effective date of a resolution adopted by the
Board terminating the Plan;
(b) the date all shares of Stock subject to the Plan are
delivered pursuant to the Plan's provisions; or
(c) ten (10) years from the Effective Date.
No Option may be granted under the Plan after the earliest to occur of the
events or dates described in the foregoing paragraphs (a) through (c) of this
Section 15; HOWEVER, Options theretofore granted may extend beyond such date.
No such termination of the Plan shall affect the previously
accrued rights of any Optionee hereunder and all Options previously granted
hereunder shall continue in force and in operation after the termination of the
Plan, except as they may be otherwise terminated in accordance with the terms of
the Plan or the Agreement.
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EXHIBIT 4.3
EMCORE CORPORATION
2000 EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
ESTABLISHMENT
1.01 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.
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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,
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(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.
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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.
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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.
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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
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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
(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.
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
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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.
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(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.
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(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 500,000 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.
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(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
(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.
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.
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(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) 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
(ii) 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.
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
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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
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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
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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.
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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
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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.
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EXHIBIT 5.1
White & Case LLP
200 S. Biscayne Boulevard
Suite 4900
Miami, FL 33131
May 18, 2000
EMCORE Corporation
394 Elizabeth Avenue
Somerset, NJ 08873
Re: EMCORE Corporation
Registration Statement on Form S-8
Ladies and Gentlemen:
You have requested our opinion in connection with the
above-referenced registration statement (the "Registration Statement"), which is
concurrently being filed by EMCORE Corporation, a New Jersey corporation (the
"Company") with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Act"). The Registration Statement relates to the
registration of 1,225,000 shares of the Company's common stock (the "Shares")
which may be required pursuant to the terms and provisions of the EMCORE
Corporation 2000 Stock Option Plan and the EMCORE Corporation 2000 Employee
Stock Purchase Plan (the "Plans").
This opinion is being furnished in accordance with the
requirements of Item 8 of Form S-8 and Item 601(b)(5)(i) of Regulation S-K.
We are familiar with the corporate proceedings relating to the
authorization of the Shares and have reviewed the corporate proceedings taken
with respect to the approval of the Plans. We have examined and relied on
originals, or copies certified to our satisfaction, of all such corporate
records of the Company and such other instruments and other certificates of
public officials, officers and representatives of the Company and such other
persons, and we have made such investigations of law, as we have deemed
appropriate as a basis for the opinion herein expressed.
We do not express or purport to express any opinions with
respect to laws other than the Federal laws of the United States. As to all
matters governed by the laws of the State of New Jersey involved in our opinions
set forth below, we have relied, with your consent, upon an opinion of Dillon
Bitar & Luther dated today and addressed to us.
Based upon the foregoing, it is our opinion that the Shares
will, if issued and delivered in accordance with the terms and provisions of the
Plans, be validly issued, fully paid and non assessable.
2
EXHIBIT 5.1
PAGE 2
We hereby consent to the filing of this opinion as an Exhibit
to the Registration Statement. By giving such consent we do not thereby admit
that we are an "expert" with respect to any part of such Registration Statement
as that term is used in the Securities Act of 1933, as amended, or the rules or
regulations of the Commission issued thereunder.
Very truly yours,
/s/ White & Case LLP
-----------------------
1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
EMCORE Corporation on Form S-8 of our report dated January 10, 2000, appearing
in the Annual Report on Form 10-K/A of EMCORE Corporation for the year ended
September 30, 1999.
/s/ Deloitte & Touche LLP
Parsippany, New Jersey
May 18, 2000
