Item
5.02(e). Departure of Directors or Principal Officers; Election
of Directors; Appointment of Principal Officers; Compensatory Arrangements
of
Certain Officers.
Adoption
of Amended and Restated 1998 Long-Term Incentive Plan
On
December 6, 2007 the Company’s stockholders approved the Company’s Amended and
Restated 1998 Long-Term Incentive Plan (as so amended and restated, the “1998
Plan”), which had previously been approved by our Board of Directors, and
the 1998 Plan became effective. The following summarizes the changes
made to the plan by way of the amendment and restatement:
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The
term of the 1998 Plan was extended to the later of
(i) December 6, 2012 or (ii) the tenth anniversary of the
date of the last increase in the number of shares reserved for
issuance
under the 1998 Plan which is approved by the Board and
stockholders.
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The
1998 Plan authorizes 3,350,000 shares for future grants, plus any
shares
that become available for issuance upon the forfeiture of currently
outstanding awards under the 1998 Plan or our 2002 Non-Qualified
Stock
Option Plan and our Directors’ Stock Option Plan (the latter two plans
being referred to as the “Terminating Plans”), and terminates the
“evergreen” feature of the plan by which additional shares had become
automatically authorized on an annual
basis.
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The
1998 Plan prohibits repricing of “underwater” options and stock
appreciation rights without stockholder
approval.
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Generally,
“full value” awards (such as restricted stock or stock units) are required
to have a minimum three year vesting schedule for awards that vest
based
on continued service with us and a one-year performance period
for awards
that vest based on the achievement of performance goals, subject
to
vesting acceleration in the event of the death, disability or retirement
of the participant or in connection with a change in control of
the
Company.
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All
stock options (other than replacement awards issued in the context
of a
merger or acquisition) must be granted with an exercise price equal
to, or
above, the fair market value of our common stock on the date of
grant.
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The
1998 Plan will permit the qualification of awards with performance-based
vesting as “performance-based compensation” within the meaning of
Section 162(m) of the Internal Revenue
Code.
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The
persons eligible to receive awards under the 1998 Plan consist of our officers,
directors, employees, and independent contractors. Awards may be
granted under the 1998 Plan in the form of stock options, stock appreciation
rights, restricted stock, stock units, bonus stock, dividend equivalents,
other
stock related awards, and performance awards that may be settled in cash,
stock,
or other property.
Except
as
otherwise provided in an award agreement, in the event of an involuntary
termination of an employee’s employment by us or our successor without “cause”
or for “good reason” within 24 months after a “change in control” (as each term
is defined in the 1998 Plan), all awards held by such individual shall become
fully vested, exercisable and all restrictions applicable to such awards
shall
lapse. In addition, any performance goals relating to any performance-based
award held by such individual will be deemed to have been met upon such
termination.
To
the
extent we undergo a corporate transaction (as defined in the 1998 Plan),
the
1998 Plan provides that outstanding awards may be assumed, substituted for
or
continued in accordance with their terms. If the awards are not assumed,
substituted for or continued, to the extent applicable, the participant will
fully vest in and have the right to exercise all of his or her outstanding
options or stock appreciation rights, including shares as to which such awards
would not otherwise be vested or exercisable, all restrictions on restricted
stock will lapse, and, with respect to restricted stock units, performance
awards and other stock units, all performance goals or other vesting criteria
will be deemed achieved at target levels and all other terms and conditions
met
and, to the extent applicable, all unexercised awards will terminate on the
close of the corporate transaction.
Awards
to
eligible participants under the 1998 Plan will be made on a discretionary
basis.
Accordingly, it is not possible to determine the benefits that will be received
by our directors, executive officers and our other employees under the plan
in
our 2008 fiscal year or any other future period.
The
1998
Plan is filed as Exhibit 99.01 to this Form 8-K and the forms of notice and
stock option agreements to be used for directors and officers of the Company
and
for employees of and consultants to the Company are filed as Exhibits 99.02
and
99.03, respectively, to this Form 8-K.
Termination
of Terminating Plans
Effective
upon stockholder approval of the 1998 Plan we terminated the Terminating
Plans
and removed the shares available under the Terminating Plans. As of
September 15, 2007, we had 448,994 shares available for grant under the
Terminating Plans.
Adoption
of Employee Stock Purchase Plan
On
December 6, 2007 the Company’s stockholders approved the Company’s Amended and
Restated Employee Stock Purchase Plan (as so amended and restated, the “Purchase
Plan”), which had previously been approved by our Board of
Directors. The primary effects of the amendment and restatement of
the plan were to extend the term of the Purchase Plan, remove the “evergreen”
provision and reserve an additional 1 million shares of our common stock
for issuance under the Purchase Plan. The Purchase Plan will become
effective at such time as determined by our Board of Directors, which is
expected to be upon the end of the current outstanding offering under the
current version of the purchase plan, which will occur in May 2008.
As
of
September 15, 2007, we had 458,178 shares available for issuance under the
plan, and with stockholder approval of the Purchase Plan an additional
1 million shares of our common stock were reserved for
issuance. If rights granted under the Purchase Plan expire,
lapse or otherwise terminate without being exercised, the shares of common
stock
not purchased under such rights will again become available for issuance
under
the Purchase Plan.
The
Purchase Plan is implemented by offerings of rights to all eligible employees
from time to time by the plan administrator. The maximum length for an offering
under the Purchase Plan is 27 months. The plan administrator may divide an
offering into two or more “purchase periods,” where, at the end of each purchase
period, participants may exercise the purchase rights they were granted under
the Purchase Plan.
Any
person who is customarily employed at least 20 hours per week and five months
per calendar year by the Company (or by any parent or subsidiary of the Company
designated by the plan administrator) on the first day of an offering is
eligible to participate in that offering. No employee is eligible to
participate in Purchase Plan if, immediately after the grant of purchase
rights,
the employee would own, directly or indirectly, stock possessing 5% or more
of
the total combined voting power or value of all classes of stock of the Company
or of any parent or subsidiary of the Company (including any stock which
such
employee may purchase under all outstanding rights and options). In addition,
no
employee may purchase more than $25,000 worth of common stock (determined
at the
fair market value of the shares at the time such rights are granted) under
all
employee stock purchase plans of the Company and its parent and subsidiary
corporations in any calendar year. In addition to the preceding limitation,
the
plan administrator may provide for individual and offering limitations on
the
maximum number of our shares of common stock that may be purchased.
The
purchase price per share at which shares of common stock are sold in an offering
under the Purchase Plan is the lower of (i) 85% of the fair market value of
a share of common stock on first day of the offering or (ii) 85% of the
fair market value of a share of common stock on the last day of the purchase
period or offering, as applicable.