Exhibit 10.1
V*I Chip Corporation
Amended
2007 Stock Option and Incentive Plan
SECTION 1. General Purpose of the Plan: Definitions
The name of the plan is the V*I Chip Corporation Amended 2007 Stock Option and Incentive Plan
(the Plan). The purpose of the Plan is to encourage and enable the employees, directors,
consultants and other key persons of V*I Chip Corporation (the Company) and its Affiliates upon
whose judgment, initiative and efforts the Company largely depends for the successful conduct of
its business to acquire a proprietary interest in the Company. It is anticipated that providing
such persons with a direct stake in the Companys welfare will assure a closer identification of
their interests with those of the Company, thereby stimulating their efforts on the Companys
behalf and strengthening their desire to remain with the Company.
The following terms shall be defined as set forth below:
Act means the Securities Act of 1933, as amended, and the rules and regulations thereunder.
Administrator is defined in Section 2(a).
Affiliate means (1) a corporation which, for purposes of Section 424 of the Code, is a
parent or subsidiary of the Company, direct or indirect or (2) a foreign partnership, corporation,
firm, joint venture, limited liability company or other entity that, directly or indirectly through
one or more intermediaries, is controlled by the Company or its parent, where the term controlled
by means the possession, direct or indirect, of the power to cause the direction of the management
and policies of such entity, whether through ownership of voting interests or voting securities, as
the case may be, by contract or otherwise.
Award or Awards, except where referring to a particular category of grant under the Plan,
shall include Incentive Stock Options, Non-Qualified Stock Options, Restricted Stock Awards,
Unrestricted Stock Awards, or any combination of the foregoing.
Board means the Board of Directors of the Company.
Code means the Internal Revenue Code of 1986, as amended, and any successor Code, and
related rules, regulations and interpretations.
Committee means the Committee of the Board referred to in Section 2.
Effective Date means the date on which the Plan is approved by stockholders as set forth in
Section 13.
Exchange Act means the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder.
Fair Market Value of the Stock on any given date means the fair market value of the Stock
determined in good faith by the Administrator; provided, however, that if the Stock
trades on a national securities exchange, the Fair Market Value on any given date is the closing
sale price on such date or, if no such closing sale price information is available, the average of
the highest bid and lowest asked prices for the Stock reported on such date. For any date that is
not a trading day, the Fair Market Value of the Stock for such date will be determined by using the
closing sale price or the average of the highest bid and lowest asked prices, as appropriate, for
the immediately preceding trading day. The Administrator can substitute a particular time of day
or other measure of closing sale price if appropriate because of changes in exchange or market
procedures. Notwithstanding the foregoing, if the date for which Fair Market Value is determined is
the first day when trading prices for the Stock are trading on a national securities exchange, the
Fair Market Value shall be the Price to the Public (or equivalent) set forth on the cover page
for the final prospectus relating to the Companys Initial Public Offering, if applicable.
Incentive Stock Option means any Stock Option designated and qualified as an incentive
stock option as defined in Section 422 of the Code.
Initial Public Offering means the consummation of the first fully underwritten, firm
commitment public offering pursuant to an effective registration statement under the Act covering
the offer and sale by the Company of its equity securities, or such other event as a result of or
following which the Stock shall be publicly held.
Non-Qualified Stock Option means any Stock Option that is not an Incentive Stock Option.
Option or Stock Option means any option to purchase shares of Stock granted pursuant to
Section 5.
Restricted Stock Award means Awards granted pursuant to Section 6.
Retirement means the employees termination of employment with the Company and its
Affiliates after attainment of the age of 62.5 years.
Stock means the Common Stock, par value $.01 per share, of the Company, subject to
adjustments pursuant to Section 3.
Transaction is defined in Section 3(c).
Unrestricted Stock Award means any Award granted pursuant to Section 7.
2
|
|
|
SECTION 2.
|
|
Administration of the Plan: Administrator Authority to Select Participants and Determine
Awards
|
(a) Administration of Plan. The Plan shall be administered by the Board or, at the discretion
of the Board, a committee of the Board comprised, except as contemplated by Section 2(c), of not
less than two directors (in either case, the Administrator).
(b) Powers of Administrator. The Administrator shall have the power and authority to grant
Awards consistent with the terms of the Plan, including the power and authority:
(i) to select the individuals to whom Awards may from time to time be granted;
(ii) to determine the time or times of grant, and the extent, if any, of Incentive Stock
Options, Non-Qualified Stock Options, Restricted Stock Awards, Unrestricted Stock Awards or any
combination of the foregoing, granted to any one or more participants;
(iii) to determine the number of shares of Stock to be covered by any Award;
(iv) to determine and modify from time to time the terms and conditions, including
restrictions, not inconsistent with the terms of the Plan, of any Award, which terms and conditions
may differ among individual Awards and participants, and to approve the form of written instruments
evidencing the Awards;
(v) to accelerate at any time the exercisability or vesting of all or any portion of any
Award;
(vi) to impose any limitations on Awards granted under the Plan, including limitations on
transfers, repurchase provisions and the like and to exercise repurchase rights or obligations;
(vii) subject to the provisions of Section 5(a)(ii), to extend at any time the period in which
Stock Options may be exercised;
(viii) to determine at any time whether, to what extent, and under what circumstances
distribution or the receipt of Stock and other amounts payable with respect to an Award shall be
deferred either automatically or at the election of the grantee and whether and to what extent the
Company shall pay or credit amounts constituting interest (at rates determined by the
Administrator) or dividends or deemed dividends on such deferrals; and
(ix) at any time to adopt, alter and repeal such rules, guidelines and practices for
administration of the Plan and for its own acts and proceedings as it shall deem advisable; to
interpret the terms and provisions of the Plan and any Award (including related written
instruments); to make all determinations it deems advisable for the administration of the Plan; to
decide all disputes arising in connection with the Plan; and to otherwise supervise the
administration of the Plan.
3
Notwithstanding the foregoing, prior to the Initial Public Offering, no Award shall be granted
under the Plan unless the recipient of such Award has executed and delivered a Stock Restriction
Agreement in substantially the form attached hereto as Exhibit A or such other form as the
Administrator may determine from time to time. All decisions and interpretations of the
Administrator shall be binding on all persons, including the Company and Plan participants.
(c) Delegation of Authority to Grant Awards. The Administrator, in its discretion, may
delegate to the Chief Executive Officer of the Company all or part of the Administrators authority
and duties with respect to the granting of Awards at Fair Market Value to individuals who are not
subject to the reporting and other provisions of Section 16 of the Exchange Act or covered
employees within the meaning of Section 162(m) of the Code, and in the event of such delegation,
such Chief Executive Officer shall be deemed a one-person Committee of the Board. Any such
delegation by the Administrator shall include a limitation as to the amount of Awards that may be
granted during the period of the delegation and shall contain guidelines as to the determination of
the exercise price of any Option, the conversion ratio or price of other Awards and the vesting
criteria. The Administrator may revoke or amend the terms of a delegation at any time but such
action shall not invalidate any prior actions of the Administrators delegate or delegates that
were consistent with the terms of the Plan.
(d) Indemnification. Neither the Board nor the Administrator, nor any member of either or any
delegate thereof, shall be liable for any act, omission, interpretation, construction or
determination made in good faith in connection with the Plan, and the members of the Board and the
Committee (and any delegate thereof) shall be entitled in all cases to indemnification and
reimbursement by the Company in respect of any claim, loss, damage, judgment, settlement or expense
(including, without limitation, reasonable attorneys fees) arising or resulting therefrom to the
fullest extent permitted by law and/or under any directors and officers liability insurance
coverage which may be in effect from time to time.
SECTION 3. Stock Issuable Under the Plan; Mergers; Substitution
(a) Stock Issuable. The maximum number of shares of Stock reserved and available for issuance
under the Plan shall be 12,000,000 shares, subject to adjustment as provided in Section 3(b). For
purposes of this limitation, the shares of Stock underlying any Awards which are forfeited,
canceled, reacquired by the Company, satisfied without the issuance of Stock or otherwise
terminated (other than by exercise) shall be added back to the shares of Stock available for
issuance under the Plan. Subject to such overall limitation, shares of Stock may be issued up to
such maximum number pursuant to any type or types of Award; provided, however, that
from and after the date on which the Company becomes subject to the deduction limit imposed by
Section 162(m) of the Code, Stock Options with respect to no more than 4,000,000 shares of Stock
may be granted to any one individual participant during any one calendar year period. The shares
available for issuance under the Plan may be authorized but unissued shares of Stock or shares of
Stock reacquired by the Company and held in its treasury.
(b) Changes in Stock. Subject to Section 3(c) hereof, if, as a result of any reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock split or other
similar change in the Companys capital stock, the outstanding shares of Stock are
4
increased or decreased or are exchanged for a different number or kind of shares or other
securities of the Company, or additional shares or new or different shares or other securities of
the Company or other non-cash assets are distributed with respect to such shares of Stock or other
securities, or, if, as a result of any merger, consolidation or sale of all or substantially all of
the assets of the Company, the outstanding shares of Stock are converted into or exchanged for a
different number or kind of securities of the Company or any successor entity (or a parent or
subsidiary thereof), the Administrator shall make an appropriate or proportionate adjustment in (i)
the maximum number of shares reserved for issuance under the Plan, (ii) the number of Stock Options
that can be granted to any one individual participant, (iii) the number and kind of shares or other
securities subject to any then outstanding Awards under the Plan, (iv) the repurchase price per
share subject to each outstanding Restricted Stock Award, and (v) the exercise price and/or
exchange price for each share subject to any then outstanding Stock Options under the Plan, without
changing the aggregate exercise price (i.e., the exercise price multiplied by the number of Stock
Options) as to which such Stock Options remain exercisable. The adjustment by the Administrator
shall be final, binding and conclusive. No fractional shares of Stock shall be issued under the
Plan resulting from any such adjustment, but the Administrator in its discretion may make a cash
payment in lieu of fractional shares.
The Administrator shall also make an appropriate or proportionate adjustment in the number of
shares subject to outstanding Awards and the exercise price and the terms of outstanding Awards to
take into consideration material changes in accounting practices or principles, extraordinary
dividends, acquisitions or dispositions of stock or property or any other event in order to avoid
distortion in the operation of the Plan, provided that no such adjustment shall be made in the case
of an Incentive Stock Option, without the consent of the participant, if it would constitute a
modification, extension or renewal of the Option within the meaning of Section 424(h) of the Code.
(c) Mergers and Other Transactions. In the case of and subject to the consummation of (i) the
dissolution or liquidation of the Company, (ii) the sale of all or substantially all of the assets
of the Company on a consolidated basis to an unrelated person or entity, (iii) a merger,
reorganization or consolidation in which the holders of the Companys outstanding voting power
immediately prior to such transaction do not own a majority of the outstanding voting power of the
surviving or resulting entity immediately upon completion of such transaction, (iv) the sale of all
or a majority of the outstanding capital stock of the Company to an unrelated person or entity or
(v) any other transaction in which the owners of the Companys outstanding voting power prior to
such transaction do not own at least a majority of the outstanding voting power of the relevant
entity immediately upon completion of the transaction (in each case, a Transaction), as of the
effective date of such Transaction, all Options that are not exercisable shall become fully
exercisable and all other Awards which are not vested shall become fully vested, except as the
Administrator may otherwise specify with respect to particular Awards. Upon the effectiveness of
the Transaction, the Plan and all outstanding Options issued hereunder shall terminate upon the
effective time of any such Transaction, unless provision is made in connection with such
Transaction in the sole discretion of the parties thereto for the assumption or continuation of
Options theretofore granted (after taking into account any acceleration hereunder) by the successor
entity, or the substitution of such Options with new Options of the successor entity or a parent or
subsidiary thereof, with such adjustment as to the number and
5
kind of shares and the per share exercise prices as such parties shall agree (after taking
into account any acceleration if any, hereunder). In the event of such termination, each optionee
shall be permitted, within a specified period of time prior to the consummation of the Transaction
as determined by the Administrator, to exercise all outstanding Options held by such optionee which
are then exercisable or will become exercisable as of the effective time of the Transaction;
provided, however, that the exercise of Options not exercisable prior to the Transaction shall be
subject to the consummation of the Transaction. (The treatment of Restricted Stock Award in
connection with any such transaction shall be as specified in the relevant Award agreement.)
(d) Substitute Awards. The Administrator may grant Awards under the Plan in substitution for
stock and stock based awards held by employees, directors or other key persons of another
corporation in connection with a merger or consolidation of the employing corporation with the
Company or a Affiliate or the acquisition by the Company or a Affiliate of property or stock of the
employing corporation. The Administrator may direct that the substitute awards be granted on such
terms and conditions as the Administrator considers appropriate in the circumstances. Any
substitute Awards granted under the Plan shall not count against the share limitations set forth in
Section 3(a).
SECTION 4. Eligibility
Participants in the Plan will be such full or part-time officers , employees, directors,
consultants and other key persons (including prospective employees) of the Company and its
Affiliates who are responsible for or contribute to the management, growth or profitability of the
Company and its Affiliates as are selected from time to time by the Administrator in its sole
discretion.
SECTION 5. Stock Options
Any Stock Option granted under the Plan shall be in such form as the Administrator may from
time to time approve.
Stock Options granted under the Plan may be either Incentive Stock Options or Non-Qualified
Stock Options. Incentive Stock Options may be granted only to employees of the Company or any
Affiliate that is a parent corporation or subsidiary corporation within the meaning of Section
424(f) of the Code. To the extent that any Option does not qualify as an Incentive Stock Option,
it shall be deemed a Non-Qualified Stock Option.
No Incentive Stock Option shall be granted under the Plan after the date which is ten years
from the date the Plan is approved by the Board.
(a) Terms of Stock Options. Stock Options granted under the Plan shall be subject to the
following terms and conditions and shall contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as the Administrator shall deem desirable. If the
Administrator so determines, Stock Options may be granted in lieu of cash compensation at the
6
participants election, subject to such terms and conditions as the Administrator may
establish, as well as in addition to other compensation.
(i) Exercise Price. The exercise price per share for the Stock covered by a Stock Option
shall be determined by the Administrator at the time of grant but shall not be less than 100
percent of the Fair Market Value on the date of grant in the case of Incentive Stock Options. If
an employee owns or is deemed to own (by reason of the attribution rules of Section 424(d) of the
Code) more than 10 percent of the combined voting power of all classes of stock of the Company or
any parent or subsidiary corporation and an Incentive Stock Option is granted to such employee, the
option price of such Incentive Stock Option shall be not less than 110 percent of the Fair Market
Value on the grant date.
(ii) Option Term. The term of each Stock Option shall be fixed by the Administrator, but no
Incentive Stock Option shall be exercisable more than ten years after the date the option is
granted. If an employee owns or is deemed to own (by reason of the attribution rules of Section
424(d) of the Code) more than 10 percent of the combined voting power of all classes of stock of
the Company or any parent or subsidiary corporation and an Incentive Stock Option is granted to
such employee, the term of such option shall be no more than five years from the date of grant.
(iii) Exercisability; Rights of a Stockholder. Stock Options shall become exercisable at such
time or times, whether or not in installments, as shall be determined by the Administrator at or
after the grant date. The Administrator may at any time accelerate the exercisability of all or
any portion of any Stock Option. An optionee shall have the rights of a stockholder only as to
shares acquired upon the exercise of a Stock Option and not as to unexercised Stock Options.
(iv) Method of Exercise. Stock Options may be exercised in whole or in part, by giving
written notice of exercise to the Company, specifying the number of shares to be purchased.
Payment of the purchase price may be made by one or more of the following methods to the extent
provided in the Option Award agreement or as otherwise provided by the Administrator:
(A) In cash, by certified or bank check or other instrument acceptable to the
Administrator;
(B) If approved by the Administrator, through the delivery (or attestation to the
ownership) of shares of Stock that are not then subject to restrictions under any Company
plan and that have been beneficially owned by the optionee for such period as may be
required by the Administrator or have been purchased by the participant on the open market.
Such surrendered shares shall be valued at Fair Market Value on the exercise date;
(C) If approved by the Administrator, by the optionee delivering to the Company a
properly executed exercise notice together with irrevocable instructions to a broker to
promptly deliver to the Company cash or a check payable and acceptable to the Company for
the purchase price; provided that in the event the optionee chooses to pay
7
the purchase price as so provided, the optionee and the broker shall comply with such
procedures and enter into such agreements of indemnity and other agreements as the
Administrator shall prescribe as a condition of such payment procedure; or
(D) By the optionee delivering to the Company a promissory note if the Board has
unanimously authorized the loan of funds to the optionee for the purpose of enabling or
assisting the optionee to effect the exercise of his or her Stock Option.
Payment instruments will be received subject to collection. No certificates for shares of
Stock so purchased will be issued to optionee until the Company has completed all steps required by
law to be taken in connection with the issuance and sale of the shares, including without
limitation (i) receipt of a representation from the optionee at the time of exercise of the Option
that the optionee is purchasing the shares for the optionees own account and not with a view to
any sale or distribution thereof, (ii) the legending of any certificate representing the shares to
evidence the foregoing representations and restrictions, and (iii) obtaining from optionee payment
or provision for all withholding taxes due as a result of the exercise of the Option. The delivery
of certificates representing the shares of Stock to be purchased pursuant to the exercise of a
Stock Option will be contingent upon receipt from the optionee (or a purchaser acting in his or her
stead in accordance with the provisions of the Stock Option) by the Company of the full purchase
price for such shares and the fulfillment of any other requirements contained in the Option Award
agreement or applicable provisions of laws. In the event an optionee chooses to pay the purchase
price by previously-owned shares of Stock through the attestation method, the shares of Stock
transferred to the optionee upon the exercise of the Stock Option shall be net of the number of
shares attested to.
(v) Annual Limit on Incentive Stock Options. To the extent required for incentive stock
option treatment under Section 422 of the Code, the aggregate Fair Market Value (determined as of
the time of grant) of the shares of Stock with respect to which Incentive Stock Options granted
under this Plan and any other plan of the Company or its parent and subsidiary corporations become
exercisable for the first time by an optionee during any calendar year shall not exceed $100,000.
To the extent that any Stock Option exceeds this limit, it shall constitute a Non-Qualified Stock
Option.
(b) Non-transferability of Options. No Stock Option shall be transferable by the optionee
otherwise than by will or by the laws of descent and distribution and all Stock Options shall be
exercisable, during the optionees lifetime, only by the optionee or by the optionees legal
representative or guardian in the event of the optionees incapacity. Notwithstanding the
foregoing, the Administrator, in its sole discretion, may provide in the Award agreement regarding
a given Option that the optionee may transfer, without consideration for the transfer, his or her
Non-Qualified Stock Options to members of his or her immediate family, to trusts for the benefit of
such family members, or to partnerships in which such family members are the only partners,
provided that the transferee agrees in writing with the Company to be bound by all of the terms and
conditions of this Plan and the applicable Option.
(c) Termination. Except as may otherwise be provided in this Section 5(c) or by the
Administrator either in the Award agreement, or subject to Section 10 below, in writing after the
Award agreement is issued, a participants rights in all Stock Options shall automatically
8
terminate upon the participants termination of employment with the Company and its Affiliates
for any reason. Notwithstanding the foregoing, the period within which to exercise the Option
shall be modified as set forth below:
(i) Termination Due to Death. If the participants employment terminates by reason of death,
(1) any Option held by the participant, which, but for such participants death, would have vested
and become exercisable on or prior to the first anniversary of such termination, shall become fully
exercisable and (2) any Option exercisable at the time of such termination may thereafter be
exercised by the participants legal representative or legatee for a period of 12 months from the
date of death or until the Expiration Date, if earlier.
(ii) Termination Due to Disability. If the participants employment terminates by reason of
Disability (as defined in Section 22(c)(3) of the Code), (1) any Option held by the participant,
which, but for such participants Disability, would have vested and become exercisable on or prior
to the first anniversary of such termination, shall become fully exercisable and (2) any Option
exercisbale at the time of such termination may thereafter be exercised by the participant for a
period of 12 months from the date of termination or until the Expiration Date, if earlier. The
death of the participant during the 12-month period provided in this Section 5(c)(ii) shall extend
such period for another 12 months from the date of death or until the Expiration Date, if earlier.
(iii) Termination Due to Retirement. Any Non-Qualified Stock Option held by an optionee whose
employment by the Company and its Affiliates is terminated by reason of Retirement shall remain
outstanding and subject to all of the terms and conditions of the Award agreement as though such
optionees employment had not ceased by reason of such Retirement. Any Incentive Stock Option held
by an optionee whose employment by the Company and its Affiliates is terminated by reason of
Retirement shall remain outstanding and subject to all of the terms and conditions of the Award
agreement for a period of three months after the employees termination of employment with the
Company and its Affiliates.
(iv) Determination of Reason. The Administrators determination of the reason for termination
of the participants employment shall be conclusive and binding on the participant and his or her
representatives or legatees.
SECTION 6. Restricted Stock Awards
(a) Nature of Restricted Stock Awards. A Restricted Stock Award is an Award pursuant to which
the Company may, in its sole discretion, grant or sell, at such purchase price as determined by the
Administrator, in its sole discretion, shares of Stock subject to such restrictions and conditions
as the Administrator may determine at the time of grant (Restricted Stock), which purchase price
shall be payable in cash or other form of consideration acceptable to the Administrator.
Conditions may be based on continuing employment (or other service relationship) and/or achievement
of pre-established performance goals and objectives. The terms and conditions of each such
agreement shall be determined by the Administrator, and such terms and conditions may differ among
individual Awards and participants.
9
(b) Rights as a Stockholder. Upon execution of a written instrument setting forth the
Restricted Stock Award and payment of any applicable purchase price, a participant shall have the
rights of a stockholder with respect to the voting of the Restricted Stock, subject to such
conditions contained in the written instrument evidencing the Restricted Stock Award. Unless the
Administrator shall otherwise determine, certificates evidencing the Restricted Stock shall remain
in the possession of the Company until such Restricted Stock is vested as provided in Section 6(d)
below, and the participant shall be required, as a condition of the grant, to deliver to the
Company a stock power endorsed in blank.
(c) Restrictions. Restricted Stock may not be sold, assigned, transferred, pledged or
otherwise encumbered or disposed of except as specifically provided herein or in the Restricted
Stock Award agreement. Except as may otherwise be provided by the Administrator either in the
Award agreement or, subject to Section 10 below, in writing after the Award agreement is issued, if
any, if a participants employment (or other service relationship) with the Company and its
Affiliates terminates for any reason, any Restricted Stock that has not vested at the time of
termination shall automatically and without any requirement of notice to such participant from or
other action by or on behalf of, the Company be deemed to have been reacquired by the Company at
the lesser of its original purchase price or Fair Market Value (determined at the time of
termination) from such participant or such participants legal representative simultaneously with
such termination of employment (or other service relationship), and thereafter shall cease to
represent any ownership of the Company by the participant or rights of the grantee as a
stockholder. Following such deemed reacquisition of unvested Restricted Stock that are represented
by physical certificates, a participant shall surrender such certificates to the Company upon
request without consideration.
(d) Vesting of Restricted Stock. The Administrator at the time of grant shall specify the
date or dates and/or the attainment of pre-established performance goals, objectives and other
conditions on which Restricted Stock shall become vested, subject to such further rights of the
Company or its assigns as may be specified in the instrument evidencing the Restricted Stock Award.
(e) Waiver, Deferral and Reinvestment of Dividends. The Restricted Stock Award agreement may
require or permit the immediate payment, waiver, deferral or investment of dividends paid on the
Restricted Stock.
SECTION 7. Unrestricted Stock Awards
Grant or Sale of Unrestricted Stock. The Administrator may, in its sole discretion, grant (or
sell at such purchase price determined by the Administrator) an Unrestricted Stock Award to any
participant pursuant to which such participant may receive shares of Stock free of any vesting
restrictions (Unrestricted Stock) under the Plan. Unrestricted Stock Awards may be granted or
sold as described in the preceding sentence in respect of past services or other valid
consideration, or in lieu of cash compensation due to such participant.
10
SECTION 8. Tax Withholding
(a) Payment by Participant. Each participant shall, no later than the date as of which the
value of an Award or of any Stock or other amounts received thereunder first becomes includable in
the gross income of the participant for Federal income tax purposes, pay to the Company, or make
arrangements satisfactory to the Administrator regarding payment of, any Federal, state, or local
taxes of any kind required by law to be withheld with respect to such income. The Company and its
Affiliates shall, to the extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to the participant. The Companys obligation to deliver stock
certificates to any participant is subject to and conditioned on tax obligations being satisfied by
the participant.
(b) Payment in Stock. Subject to approval by the Administrator, a participant may elect to
have the minimum required tax withholding obligation satisfied, in whole or in part, by (i)
authorizing the Company to withhold from shares of Stock to be issued pursuant to any Award a
number of shares with an aggregate Fair Market Value (as of the date the withholding is effected)
that would satisfy the withholding amount due, or (ii) transferring to the Company shares of Stock
owned by the participant with a minimum aggregate Fair Market Value (as of the date the withholding
is effected) that would satisfy the minimum withholding amount due.
SECTION 9. Transfer, Leave of Absence, Etc.
For purposes of the Plan, the following events shall not be deemed a termination of
employment:
(a) a transfer to the employment of the Company from a Affiliate or from the Company to a
Affiliate, or from one Affiliate to another; or
(b) an approved leave of absence for military service or sickness, or for any other purpose
approved by the Company, if the employees right to re-employment is guaranteed either by a statute
or by contract or under the policy pursuant to which the leave of absence was granted or if the
Administrator otherwise so provides in writing.
SECTION 10. Amendments and Termination
The Board may, at any time, amend or discontinue the Plan and the Administrator may, at any
time, amend or cancel any outstanding Award for the purpose of satisfying changes in law or for any
other lawful purpose, but no such action shall adversely affect rights under any outstanding Award
without the holders consent. The Administrator may provide substitute Awards at the same or
reduced exercise or purchase price or with no exercise or purchase price in a manner not
inconsistent with the terms of the Plan, but such price, if any, must satisfy the requirements
which would apply to the substitute or amended Award if it were then initially granted under this
Plan, but no such action shall adversely affect rights under any outstanding Award without the
holders consent. If and to the extent determined by the Administrator to be required by the Code
to ensure that Incentive Stock Options granted under the Plan are qualified
11
under Section 422 of the Code or to ensure that compensation earned under Stock Options
qualifies as performance-based compensation under Section 162(m) of the Code, if and to the extent
intended to so qualify, Plan amendments shall be subject to approval by the Company stockholders
entitled to vote at a meeting of stockholders. Nothing in this Section 10 shall limit the Boards
authority to take any action permitted pursuant to Section 3(c).
SECTION 11. Status of Plan
With respect to the portion of any Award that has not been exercised and any payments in cash,
Stock or other consideration not received by a participant, a participant shall have no rights
greater than those of a general creditor of the Company unless the Administrator shall otherwise
expressly determine in connection with any Award or Awards. In its sole discretion, the
Administrator may authorize the creation of trusts or other arrangements to meet the Companys
obligations to deliver Stock or make payments with respect to Awards hereunder, provided that the
existence of such trusts or other arrangements is consistent with the foregoing sentence.
SECTION 12. General Provisions
(a) No Distribution; Compliance with Legal Requirements. The Administrator may require each
person acquiring Stock pursuant to an Award to represent to and agree with the Company in writing
that such person is acquiring the shares without a view to distribution thereof.
No shares of Stock shall be issued pursuant to an Award until all applicable securities law
and other legal and stock exchange or similar requirements have been satisfied. The Administrator
may require the placing of such stop-orders and restrictive legends on certificates for Stock and
Awards as it deems appropriate.
(b) Delivery of Stock Certificates. Stock certificates to participants under this Plan shall
be deemed delivered for all purposes when the Company or a stock transfer agent of the Company
shall have mailed such certificates in the United States mail, addressed to the participant, at the
participants last known address on file with the Company.
(c) Other Compensation Arrangements; No Employment Rights. Nothing contained in this Plan
shall prevent the Board from adopting other or additional compensation arrangements, including
trusts, and such arrangements may be either generally applicable or applicable only in specific
cases. The adoption of this Plan and the grant of Awards do not confer upon any employee any right
to continued employment with the Company or any Affiliate.
(d) Trading Restrictions. Option exercises and other Awards under the Plan shall be subject
to such Companys trading restrictions, terms and conditions, including, without limitation, the
restrictions, terms and conditions set forth in a Stock Restriction Agreement executed and
delivered pursuant to Section 2 hereof, as may be established or required by the Administrator, or
in accordance with policies set by the Administrator, from time to time.
12
(e) Loans to Participants. The Company shall have the authority to make loans to participants
hereunder (including to facilitate the purchase of shares) and shall further have the authority to
issue shares for promissory notes hereunder.
(f) Designation of Beneficiary. Each participant to whom an Award has been made under the
Plan may designate a beneficiary or beneficiaries to exercise any Award or receive any payment
under any Award payable on or after the participants death. Any such designation shall be on a
form provided for that purpose by the Administrator and shall not be effective until received by
the Administrator. If no beneficiary has been designated by a deceased participant, or if the
designated beneficiaries have predeceased the participant, the beneficiary shall be the
participants estate.
SECTION 13. Effective Date of Plan
This Plan shall become effective upon approval by the stockholders in accordance with
applicable law. Subject to such approval by the stockholders and to the requirement that no Stock
may be issued hereunder prior to such approval, Stock Options and other Awards may be granted
hereunder on and after adoption of this Plan by the Board.
SECTION 14. Governing Law
This Plan and all Awards and actions taken thereunder shall be governed by, and construed in
accordance with, the laws of the State of Delaware, applied without regard to conflict of law
principles.
DATE APPROVED BY BOARD OF DIRECTORS: April 25, 2007
DATE APPROVED BY STOCKHOLDERS April 25, 2007
AS AMENDED ON JUNE 4, 2007
AS AMENDED ON MARCH 6, 2008
13
Exhibit 10.3
STOCK RESTRICTION AGREEMENT
V*I CHIP CORPORATION
Agreement made as of , by and between V*I CHIP CORPORATION, a Delaware
corporation with an address of 25 Frontage Road, Andover, Massachusetts 01810 (the Company), and
(the Stockholder), which is the holder of options to purchase shares of common stock, par value $.01 per share, of the Company (the Common Stock) (collectively
the shares of Common Stock issuable upon the exercise of such options, and all other shares of
Common Stock acquired by the Stockholder subsequent to the date hereof are herein referred to as
the Stock).
WHEREAS, the Stockholder has been granted, as of the date first set forth above, options to
purchase shares of Common Stock of the Company pursuant to the Companys Amended 2007
Stock Option and Incentive Plan (the Equity Incentive Plan);
NOW, THEREFORE, in consideration of the mutual promises of the parties and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties hereby agree as
follows.
SECTION 1. Voluntary Transfers. Neither the Stockholder nor any permitted transferee
of his or her shares under Section 5 may sell, assign, transfer, exchange, pledge or otherwise
dispose of any shares of Stock or any interest therein now held or hereafter acquired by such
shareholder (collectively referred to as a transfer) without first giving written notice thereof
to the Company, identifying the proposed transferee, the purchase price, if any, and terms of the
proposed transaction, and offering said shares to the Company for purchase by it as hereinafter
provided. On or prior to the later of: (i) 30 days after receipt of the notice or (ii) if the
Stockholder acquired said shares of Stock from the Company, seven months after the date of such
acquisition, the Company may elect to purchase all of the shares so offered and if it does not do
so, said shares may be transferred within 60 days after the expiration of said period to the
proposed transferee upon the price and terms specified in the notice, provided that said transferee
shall thereupon become a party to this Agreement as a Stockholder in the manner provided
hereinafter.
SECTION 2. Termination of Employment. Within 30 days after the voluntary or
involuntary termination of all employment of a Stockholder with the Company as an employee, officer
and Director thereof, except a termination by reason of death, said Stockholder and each transferee
of his or her shares under Section 5 shall give written notice to the Company offering to the
Company for purchase as hereinafter provided all of the shares of Stock owned on the date of
termination by said Stockholder and each such transferee. On or prior to the later of: (i) 30
days after receipt of the notice or (ii) if the Stockholder acquired any shares of Stock from the
Company, seven months after the date of such acquisition, the Company may elect to purchase all or
any part of the shares so offered and if it does not elect to do so, said shares may be retained by
said Stockholder or transferee subject to all other provisions of this Agreement.
1
SECTION 3. Death of a Stockholder. In the event of the death of the Stockholder, his
or her executors or administrators and each transferee of his or her shares under Section 5 shall,
within 90 days after the date of death, give written notice thereof to the Company offering to it
for purchase as hereinafter provided all of the shares of Stock owned on said date by the
Stockholder and each such transferee. On or prior to the later of: (i) 30 days after receipt of
the notice or (ii) if the Stockholder acquired any shares of Stock from the Company, seven months
after the date of such acquisition, the Company may elect to purchase all or any part of the shares
so offered; and if the Company does not do so, said shares may be retained by the estate of said
Stockholder or by such transferee subject to all other provisions of this Agreement.
SECTION 4. Transfers by Operation of Law. In the event that a Stockholder (i) files a
voluntary petition under any bankruptcy or insolvency law, or a petition for the appointment of a
receiver or makes an assignment for the benefit of creditors, or (ii) is subjected involuntarily to
such a petition or assignment or to an attachment or other legal or equitable interest with respect
to his or her shares of Stock, and such involuntary petition or assignment or attachment is not
discharged within 60 days after its date, or (iii) is subjected to a transfer of shares of his or
her Stock by operation of law, the Company shall have the right to elect to purchase all or any
part of the shares of Stock which are owned by the Stockholder. Failure of the Company to elect to
purchase said shares under this Section shall not affect its right to purchase the same shares
under Section 1 in the event of a proposed sale, assignment, transfer, pledge or other disposition
thereof by or to any receiver, petitioner, assignee, transferee or other person obtaining an
interest in said shares.
SECTION 5. Exceptions to Restrictions. Except as provided above, these restrictions
shall be inapplicable to:
(a) Transfers of Stock between the Stockholder and the trustees of a trust revocable by
the Stockholder alone,
(b) Transfers of Stock between the Stockholder and his or her guardian or conservator,
and
(c) Transfers of Stock upon the death of the Stockholder to his or her executors or
administrators or to trustees under his or her will;
provided, that such Stock in the hands of each such transferee shall remain subject to this
Agreement.
SECTION 6. Transfers in Violation of Agreement. If any transfer of shares of Stock is
made or attempted contrary to the provisions of this Agreement, or if shares of Stock are not
offered to the Company as required by this Agreement, the Company shall have the right to purchase
said shares from the owner thereof or his or her transferee at any time before or after the
transfer, as hereinafter provided. In addition to any other legal or equitable remedies which it
may have, the Company may enforce its rights by actions for specific performance (to the extent
permitted by law) and may refuse to recognize any such transferee as one of its stockholders for
2
any purpose, including without limitation for purposes of dividend and voting rights, until
all applicable provisions of this Agreement have been complied with.
SECTION 7. Purchase Price.
(a) Except as provided in Section 7(b) of this Agreement, unless otherwise determined by the
unanimous consent of the members of the Board of Directors the purchase price per share of Stock
which the Company elects to purchase pursuant to this Agreement shall be equal to the exercise
price of the most recent award of an option under the Companys Equity Incentive Plan, provided
that the exercise price of such option was not less than the fair market value of the Stock at the
time of grant and was granted not more than three months prior to the event giving rise to the
Stockholders right to purchase such Stock. In the event no such option was awarded within such
three month period, then the purchase price per share of Stock shall be the fair market value of
such Stock as determined by unanimous consent of the Board of Directors.
(b) Notwithstanding any contrary provisions hereof, in the event of a proposed sale of Stock
of the Stockholder under Section 1, or of the Stockholders transferee under Section 5, to a third
party in a bona fide transaction for fair value payable in cash or the equivalent currently or in
future installments, the purchase price of said Stock shall be the value offered by such third
party and the Company shall have the right of first refusal, exercisable within the period
specified in Section 1, to purchase said Stock at such price upon terms equivalent to those offered
by such third party. Such right of first refusal shall not apply to a proposed assignment,
transfer, exchange, pledge or any other sale or disposition of Stock under Section 1 which does not
constitute a sale as described above, and the provisions of subparagraphs (a) and (b) of this
Section 7 shall apply to such other transactions.
SECTION 8. Tenders. All shares of Stock which the Company has elected to purchase
hereunder shall be tendered to the Company, or to one or more substitute purchasers designated by
it, at the principal office of the Company at a reasonable date and time specified by it (in any
event within 30 days after the Companys election), by delivery of certificates representing such
shares, endorsed in blank and in proper form for transfer against payment of the purchase price in
cash or by certified or bank checks, except as provided in Section 9.
SECTION 9. Payment by Installments. If no person has been designated as a substitute
purchaser by the Company pursuant to Section 8 and if the total purchase price of a single purchase
of Stock by the Company exceeds 10% of its working capital as of any date within 60 days prior to
the date of tender of said Stock, the Company may elect to make payment in such installments as it
deems appropriate over a period not exceeding 36 months from the date of tender. Unpaid
installments shall bear interest at the lowest applicable Federal rate established under
Section 1274(d)(2) (or its successor provision) of the Internal Revenue Code which is in effect
during the three month period ending with the month in which the Company elects to purchase, and
shall be evidenced by a promissory note of the Company.
3
SECTION 10. No Transfer of Unvested Shares. The Stockholder acknowledges and agrees
that his or her interests in any shares of Restricted Stock awarded under the Equity Incentive Plan
are subject to forfeiture and repurchase unless and until all conditions to the vesting of such
shares have been satisfied under the Equity Incentive Plan and the related Restricted Stock Award,
and that such shares may not be transferred in any manner unless and until all conditions to such
vesting have been fulfilled and the restrictions shall have lapsed.
SECTION 11. Waiver and Amendment. From time to time the Company may waive its rights
hereunder either generally or with respect to one or more specific transfers which have been
proposed, attempted or made. All action to be taken by the Company hereunder (including any
amendment of this Agreement) shall be taken only with the consent of the holders of a majority of
the issued and outstanding shares of Common Stock. Any Stock which the Company has elected to
purchase hereunder may be disposed of by the Company (acting through its Board of Directors) in
such manner as it deems appropriate, with or without further restrictions on the transfer thereof,
subject to any applicable legal requirements or contractual agreements.
SECTION 12. Action by Stockholders. Unless otherwise expressly provided to the
contrary herein, in any case where the holders of issued and outstanding shares of Common Stock are
to consent or otherwise act under this Agreement, such action may be taken by written consent of
such stockholders or by a meeting of the stockholders called in the manner provided for a meeting
of stockholders in the by-laws of the Company.
SECTION 13. Termination. This Agreement shall terminate upon the first to occur of
the following events:
(a) The consummation of a Transaction (as such term is defined in the Equity Incentive
Plan);
(b) The closing of a registered underwritten public offering of the Companys equity
securities or such other event as a result of or following which the Companys equity
securities are publicly held; or
(c) The unanimous consent of the Board of Directors and the holders of a majority of
the issued and outstanding shares of Common Stock.
SECTION 14. Legend on Certificates. Each certificate of Stock subject to this
Agreement shall bear on its face the following legend:
The shares represented by this certificate are subject to
restrictions on transfer, a copy of which will be furnished by the
Company to the holder of this certificate upon written request and
without charge.
4
SECTION 15. Parties. This Agreement shall be binding upon the parties hereto and
their heirs, representatives, successors and assigns. The Company may assign its rights hereunder
either generally or from time to time to one or more substitute purchasers of Stock which it has
the right to purchase, except as provided in Section 9. Transferees, successors or additional
holders of Stock may become parties to this Agreement by endorsing a schedule attached hereto or by
executing a counterpart of this Agreement. An original copy of this Agreement and of any
counterpart subsequently executed shall be kept by the Secretary of the Company.
SECTION 16. Notices. All notices and elections hereunder shall be in writing and
shall be delivered, transmitted by facsimile or sent by certified or registered mail, postage
prepaid, to the parties at their addresses set forth above or to any subsequent address of which
the Company has notified the Stockholders or any Stockholder has notified the Company. Such
notices or elections shall be effective upon receipt or three days after the date mailed, whichever
is sooner.
SECTION 17. Governing Law. This Agreement shall be construed under and governed by
the laws of the State of Delaware, applied without regard to its conflicts of laws principles.
[Remainder of page left blank intentionally]
5
EXECUTED as an instrument under seal as of the date first set forth above.
|
|
|
|
|
|
V*I CHIP CORPORATION
|
|
|
By:
|
|
|
|
Name:
|
|
|
|
Title:
|
President
|
|
|
|
STOCKHOLDER:
|
|
|
|
|
|
[NAME]
|
|
|
|
|
|
The undersigned holder of shares of Common Stock of the Company hereby consents to the
execution and delivery of this Agreement by the Company.
|
|
|
|
|
|
VICOR CORPORATION
|
|
|
By:
|
|
|
|
Name:
|
|
|
|
Title:
|
|
|
|
6