UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): May 14, 2014
CPS TECHNOLOGIES
CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware |
0-16088 |
04-2832509 |
(State or other jurisdiction of incorporation)
|
(Commission File Number) |
(IRS Employer Identification No.) |
111 South Worcester Street, Norton, Massachusetts |
02766 |
(Address of principal executive offices) |
(Zip Code) |
|
|
Registrant’s telephone number, including area code |
508-222-0614 |
|
|
(Former name or former address, if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to rule 14d-2(b)
under the
Exchange Act (17CFR 240.14d-2(b))
[ ] Pre-commencement communications
pursuant to Rule 13e-4(c)) under the
Exchange Act (17 CFR 240.13e-4( c)).
Item 5.07 Submission of Matters to a Vote of Security Holders.
On May 14, 2014, the Company held its
2014 annual meeting of shareholders (the “Meeting”) at the offices of counsel to the Company, Wilmer Cutler Pickering
Hale and Dorr LLP, 60 State Street, Boston, Massachusetts 02109. Set forth below are the matters voted upon at the meeting and
voting results:
The final tabulation of votes from the 2014 annual
meeting is as follows:
Total shares eligible to vote:
13,078.057
Total shares represented at the
meeting: 10,766, 665 (82.3%)
For all proposals below, except
proposal #2, there were 4,660,536 broker non-votes
Grant Bennett 6,095,812 for (99.8%)
Frank Hughes 6,095,812 for (99.8%)
Dan Snow 6,095,712 for (99.8%)
| 2. | Proposal to Increase the number of authorized shares from 15 million to 20 million. |
For: 10,452,262 (79.9% of total
eligible shares); 63,336 against; 251,067 abstained
| 3. | Proposal to Increase the number of shares available for issuance in the stock incentive plan from 1.5 million to 3.0 million
and to permit the grant of Incentive Stock Options. |
For: 5,920,857 (97.1%); 175,122
against; 10,150 abstained
| 4. | Advisor vote on the compensation of named executive officers: |
For: 6,069,692 (99.6%); 24,237
against; 12,200 abstained
| 5. | Advisory vote on the frequency of voting by stockholders on the compensation of named executive officers: |
For one year: 6,070,373 (99.5%)
Item 5.03 Amendments to Articles of Incorporation
or Bylaws; Change in Fiscal Year
The amended Bylaws are attached as Exhibit 3.1 and are herein incorporated by reference.
(d)
EXHIBIT NUMBER
|
DESCRIPTION |
99 |
The following exhibit 99 is being furnished herewith to this Current
Report on Form 8-K: |
3.1 |
Fourth Amendment to the Restated Certificate of Incorporation
of the Company |
10. |
Amended and Restated CPS Technologies Corporation 2009 Stock Incentive Plan |
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
CPS Technologies Corporation
(Registrant) |
Date: May 20, 2014 |
/s/ Ralph M. Norwood
Ralph M. Norwood
Chief Financial Officer
|
EXHIBIT INDEX
EXHIBIT NUMBER
|
DESCRIPTION |
99 |
The following exhibit 99 is being furnished herewith to this Current Report on Form 8-K: |
3.1 |
Fourth Amended to the Restated Certificate of Incorporation
of the Company |
10. |
Amended and Restated CPS Technologies Corporation 2009 Stock Incentive Plan |
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
CPS TECHNOLOGIES CORP.
(Pursuant to Section 242
of the General Corporation Law of the State
of Delaware)
CPS Technologies Corp. (the “Corporation”), a corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware, does hereby certify as follows:
1.
That at a meeting of the Board of Directors of the Corporation, resolutions were adopted recommending an amendment of the
Corporation’s Restated Certificate of Incorporation (as amended to date) and directing that such amendment be considered
at the next annual meeting of the stockholders of the Corporation. The text of the proposed amendment is as follows:
Article FOURTH of the Certificate
of Incorporation of the Corporation shall be amended by deleting the first paragraph of Article FOURTH thereof in its entirety
and substituting therefor the following:
“FOURTH.
The total number of shares and the par value, if any, of each class of stock which the Corporation is authorized to issue is (i)
20,000,000 shares of Common Stock, par value $0.01 per share (“Common Stock”) and (ii) 5,000,000 shares of Preferred
Stock, par value $0.01 per share (“Preferred Stock”).”
2. That said amendment, having been duly proposed and recommended by the Board of Directors of the Corporation, was considered
by the stockholders of the Corporation at the annual meeting of stockholders, duly called and held upon notice in accordance with
Section 222 of the General Corporation Law of the State of Delaware.
3. That said amendment was duly adopted, by the holders of a majority of the outstanding stock of each class of stock of
the Corporation entitled to vote thereon, in accordance with the provisions of Section 242 of the General Corporation Law of the
State of Delaware.
The undersigned President of the Corporation hereby makes this certificate, declaring and certifying that the facts stated herein
are true, and accordingly has hereunto set his hand this 14th day of May, 2014.
CPS TECHNOLOGIES CORP.
By: /s/ Grant C. Bennett
Grant C. Bennett, President
CPS TECHNOLOGIES CORPORATION
AMENDED AND RESTATED
2009 STOCK INCENTIVE PLAN
1.
Purpose
The purpose of this Amended and Restated
2009 Stock Incentive Plan (the “Plan”) of CPS Technologies Corporation, a Delaware corporation (the “Company”),
is to advance the interests of the Company’s stockholders by enhancing the Company’s ability to attract, retain and
motivate persons who are expected to make important contributions to the Company and by providing such persons with equity ownership
opportunities and performance-based incentives that are intended to better align the interests of such persons with those of the
Company’s stockholders. Except where the context otherwise requires, the term “Company” shall
include any of the Company’s present or future parent or subsidiary corporations as defined in Sections 424(e) or (f) of
the Internal Revenue Code of 1986, as amended, and any regulations thereunder (the “Code”).
2.
Eligibility
Subject to the terms and conditions of
the Plan, all of the Company’s employees, officers, and directors are eligible to be granted options (incentive and non-statutory),
stock appreciation rights (“SARs”), restricted stock, restricted stock units and other stock-based awards
(each, an “Award”) under the Plan. Consultants and advisors to the Company (as such terms are defined
and interpreted for purposes of Form S-8 (or any successor form)) are also eligible to be granted Awards. Each person who is granted
an Award under the Plan is deemed a “Participant.”
3.
Administration and Delegation
(a)
Administration by Board of Directors. The Plan will be administered by the Board of Directors of the Company
(the “Board”). The Board shall have authority to grant Awards and to adopt, amend and repeal such
administrative rules, guidelines and practices relating to the Plan as it shall deem advisable. The Board may construe and
interpret the terms of the Plan and any Award agreements entered into under the Plan. The Board may correct any defect, supply
any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem expedient to
carry the Plan into effect and it shall be the sole and final judge of such expediency. All decisions by the Board shall
be made in the Board’s sole discretion and shall be final and binding on all persons having or claiming any interest in the
Plan or in any Award.
(b)
Appointment of Committees. To the extent permitted by applicable law, the Board may delegate any or all of
its powers under the Plan to one or more committees or subcommittees of the Board (a “Committee”).
All references in the Plan to the “Board” shall mean the Board or a Committee of the Board or the officers
referred to in Section 3(c) to the extent that the Board’s powers or authority under the Plan have been delegated to such
Committee or officers.
(c)
Delegation to Officers. To the extent permitted by applicable law, the Board may delegate to one or more officers
of the Company the power to grant Options and other Awards that constitute rights under Delaware law (subject to any limitations
under the Plan) to employees or officers of the Company or any of its present or future subsidiary corporations and to exercise
such other powers under the Plan as the Board may determine, provided that the Board shall fix the terms of the Awards to be granted
by such officers (including the exercise price of the Awards, which may include a formula by which the exercise price will be determined)
and the maximum number of shares subject to such Awards that the officers may grant; provided further, however, that no officer
shall be authorized to grant Awards to any “executive officer” of the Company (as defined by Rule 3b-7 under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) or to any “officer” of the Company
(as defined by Rule 16a-1 under the Exchange Act). The Board may not delegate authority under this Section 3(c) to grant
restricted stock, unless Delaware law then permits such delegation.
4.
Stock Available for Awards
(a)
Number of Shares; Share Counting.
(1)
Authorized Number of Shares. Subject to adjustment under Section 9, Awards may be made under the Plan for up
to 3,000,000 shares of common stock, $0.01 par value per share, of the Company (the “Common Stock”).
Shares issued under the Plan may consist in whole or in part of authorized but unissued shares or treasury shares.
(2)
Share Counting. For purposes of counting the number of shares available for the grant of Awards under the Plan
(i) all shares of Common Stock covered by independent SARs shall be counted against the number of shares available for the grant
of Awards; provided, however, that independent SARs that may be settled only in cash shall not be so counted; (ii) if any
Award (A) expires or is terminated, surrendered or canceled without having been fully exercised or is forfeited in whole or in
part (including as the result of shares of Common Stock subject to such Award being repurchased by the Company at the original
issuance price pursuant to a contractual repurchase right) or (B) results in any Common Stock not being issued (including as a
result of an independent SAR that was settleable either in cash or in stock actually being settled in cash), the unused Common
Stock covered by such Award shall again be available for the grant of Awards; provided, however, in the case of independent SARs,
that the full number of shares subject to any stock-settled SAR shall be counted against the shares available under the Plan in
proportion to the portion of the SAR actually exercised regardless of the number of shares actually used to settle such SAR upon
exercise; (iii) shares of Common Stock delivered (either by actual delivery, attestation, or net exercise) to the Company by a
Participant to (A) purchase shares of Common Stock upon the exercise of an Award or (B) satisfy tax withholding obligations (including
shares retained from the Award creating the tax obligation) shall not be added back to the number of shares available for the future
grant of Awards; and (iv) shares of Common Stock repurchased by the Company on the open market using the proceeds from the exercise
of an Award shall not increase the number of shares available for future grant of Awards.
(b)
Substitute Awards. In connection with a merger or consolidation of an entity with the Company or the acquisition
by the Company of property or stock of an entity, the Board may grant Awards in substitution for any options or other stock or
stock-based awards granted by such entity or an affiliate thereof. Substitute Awards may be granted on such terms as the
Board deems appropriate in the circumstances, notwithstanding any limitations on Awards contained in the Plan. Substitute
Awards shall not count against the overall share limit set forth in Section 4(a)(1).
5.
Stock Options
(a)
General. Subject to the terms and conditions of the Plan, the Board may grant incentive stock options and nonstatutory
stock options to purchase Common Stock (each, an “Option”) and determine the number of shares of Common
Stock to be covered by each Option, the exercise price of each Option, and the conditions and limitations applicable to the exercise
of each Option, including conditions relating to applicable federal or state securities laws, as it considers necessary or advisable.
The Board shall designate Options as either incentive stock options or nonstatutory stock options. An option that is intended
to be an incentive stock option and which meets the requirements of Section 422 of the Code shall be designated an “Incentive
Stock Option” or “ISO”, which ISOs may only be granted to employees of the Company and
its subsidiaries. An Option that is not intended to be an incentive stock option as defined in Section 422 of the Code or
otherwise that does not qualify as an incentive stock option shall be designated a “Nonstatutory Stock Option”
or “NSO.” Any Option or portion thereof that does not qualify as an ISO shall be, and shall be
treated as, an NSO.
(b)
Exercise Price. The Board shall establish the exercise price of each Option and specify the exercise price
in the applicable option agreement. The exercise price shall be not less than 100% of the Fair Market Value (as defined below)
on the date the Option is granted; provided that if the Board approves the grant of an Option with an exercise price to
be determined on a future date, the exercise price shall be not less than 100% of the Fair Market Value on such future date.
If any Participant to whom an Incentive Stock Option is to be granted under the Plan is, at the time of the grant of such Incentive
Stock Option, the owner of stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock
of the Company (after taking into account the attribution of stock ownership rules of Section 424(d) of the Code), then the Option
exercise price per share subject to such ISO shall not be less than one hundred ten percent (110%) of the Fair Market Value of
a share of Common Stock at the time of grant.
(c)
Duration of Options. Each Option shall be exercisable at such times and subject to such terms and conditions
as the Board may specify in the applicable option agreement; provided, however, that no Option will be granted with a term
in excess of, or be exercisable after, 10 years following the date of grant and provided, further, that no Option shall
be exercisable later than the fifth anniversary date of its date of grant for an ISO granted to a Participant who at the time of
such grant owns stock possessing more than ten percent (10%) or more of the total combined voting power of all classes of stock
of the Company.
(d)
Exercise of Options. Options may be exercised by delivery to the Company of a written notice of exercise signed
by the proper person or by any other form of notice (including electronic notice) approved by the Company, together with payment
in full as specified in Section 5(e) for the number of shares for which the Option is exercised. Shares of Common Stock subject
to the Option will be delivered by the Company as soon as practicable following exercise.
(e)
Payment Upon Exercise. Common Stock purchased upon the exercise of an Option granted under the Plan shall be
paid for as follows:
(1)
in cash or by check, payable to the order of the Company;
(2)
except as may otherwise be provided in the applicable option agreement, by (i) delivery of an irrevocable and unconditional
undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required
tax withholding or (ii) delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a
creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax
withholding;
(3)
to the extent provided for in the applicable option agreement or approved by the Board, in its sole discretion, by delivery
(either by actual delivery or attestation) of shares of Common Stock owned by the Participant valued at their Fair Market Value
(as defined below), provided (i) such method of payment is then permitted under applicable law, (ii) such Common Stock, if acquired
directly from the Company, was owned by the Participant for such minimum period of time, if any, as may be established by the Board
in its discretion and (iii) such Common Stock is not subject to any repurchase, forfeiture, unfulfilled vesting or other similar
requirements;
(4)
to the extent provided for in the applicable Option agreement or approved by the Board in its sole discretion, by delivery
of a notice of “net exercise” to the Company, as a result of which the Participant would receive the number of shares
of Common Stock underlying the Option so exercised reduced by the number of shares of Common Stock equal to the aggregate exercise
price of the Option divided by the Fair Market Value on the date of exercise;
(5)
to the extent permitted by applicable law and provided for in the applicable Option agreement or approved by the Board,
in its sole discretion, by payment of such other lawful consideration as the Board may determine; or
(6)
by any combination of the above permitted forms of payment.
(f)
Fair Market Value. “Fair Market Value” of a share of Common Stock for purposes of
the Plan will be determined as follows:
(1)
if the Common Stock trades on a national securities exchange, the closing sale price (for the primary trading session) on the date
of grant; or
(2)
if the Common Stock does not trade on any such exchange, the average of the closing bid and asked prices as reported by an authorized
OTCBB market data vendor as listed on the OTCBB website (otcbb.com) on the date of grant; or
(3)
if the Common Stock is not publicly traded, the Board will determine the Fair Market Value for purposes of the Plan using any measure
of value it determines to be appropriate (including, as it considers appropriate, relying on appraisals) in a manner consistent
with the valuation principles under Code Section 409A, except as the Board or Committee may expressly determine otherwise.
For any date that is not a trading day,
the Fair Market Value of a share of Common Stock for such date will be determined by using the closing sale price or average of
the bid and asked prices, as appropriate, for the immediately preceding trading day and with the timing in the formulas above adjusted
accordingly. The Board can substitute a particular time of day or other measure of “closing sale price” or “bid
and asked prices” if appropriate because of exchange or market procedures or can, in its sole discretion, use weighted averages
either on a daily basis or such longer period as complies with Code Section 409A.
The Board has sole discretion to determine
the Fair Market Value for purposes of this Plan, and all Awards are conditioned on the participants’ agreement that the Board’s
determination is conclusive and binding even though others might make a different determination.
(g)
Termination of Employment or Consulting Arrangement. Subject to subsection (h) below with respect to ISOs, each option agreement
shall set forth the extent to which the Participant shall have the right to exercise the Option following termination of the Participant’s
employment or consulting arrangement with the Company. Such provisions shall be determined in the sole discretion of the
Board, shall be included in the option agreement entered into with each Participant, need not be uniform among all Options issued
pursuant to this Section 5, and may reflect distinctions based on the reasons for termination of employment.
(h)
Special Provisions for ISOs. The following provisions shall apply with respect to the grant of Incentive Stock Options
to employees:
(1)
For as long as the Code shall so provide, Options granted to any Participant under the Plan which are intended to constitute Incentive
Stock Options shall not constitute Incentive Stock Options to the extent that such Options, in the aggregate, become exercisable
for the first time in any one (1) calendar year for shares of Common Stock with an aggregate Fair Market Value (determined as of
the respective date or dates of grant) of more than $100,000 (or such other maximum limit imposed from time to time under Code
Section 422), but rather Options in excess of such limit shall be treated as NSOs. In such an event, the determination of
which Options shall remain ISOs and which shall be treated as NSOs shall be based on the order in which such Options were granted.
All other terms and conditions of such Options that are deemed to be NSOs shall remain unchanged.
(2)
No Incentive Stock Option may be exercised unless, at the time of such exercise, the Participant is, and has been continuously
since the date of grant of his or her Option, an employee of the Company, except that:
(i)
an Incentive Stock Option may be exercised within the period of three (3) months after the date the Participant ceases to be an
employee of the Company (or within such lesser period as may be specified in the applicable Award agreement) if and only to the
extent that the Incentive Stock Option was exercisable at the date of employment termination, provided that the option agreement
with respect to such Option may designate a longer exercise period, and any exercise after such three-month period shall be treated
as the exercise of a NSO under the Plan;
(ii)
if the Participant dies while an employee of the Company, or within three (3) months after the Participant ceases to be an employee,
the Incentive Stock Option may be exercised by the person to whom it is transferred by will or the laws of descent and distribution
within the period of one year after the date of death (or within such lesser period as may be specified in the applicable option
agreement) if and only to the extent that the ISO was exercisable at the date of death; and
(iii)
if the Participant becomes disabled (within the meaning of Section 22(e)(3) or any successor section of the Code) while an
employee of the Company, the Incentive Stock Option may be exercised within the period of one (1) year after the date the Participant
ceases to be an employee because of such disability (or within such lesser period as may be specified in the applicable option
agreement) if and only to the extent that the ISO was exercisable at the date of employment termination.
6.
Stock Appreciation Rights
(a)
General. The Board may grant Awards consisting of SARs entitling the holder, upon exercise, to receive an amount
of Common Stock or cash or a combination thereof (such form to be determined by the Board) determined by reference to appreciation,
from and after the date of grant, in the Fair Market Value of a share of Common Stock over the measurement price established pursuant
to Section 6(c). The date as of which such appreciation is determined shall be the exercise date.
(b)
Grants. SARs may be granted in tandem with, or independently of, Options granted under the Plan.
(1)
Tandem Awards. When SARs are expressly granted in tandem with Options, (i) the SAR will be exercisable only
at such time or times, and to the extent, that the related Option is exercisable (except to the extent designated by the Board
in connection with a Reorganization Event) and will be exercisable in accordance with the procedure required for exercise of the
related Option; (ii) the SAR will terminate and no longer be exercisable upon the termination or exercise of the related Option,
except to the extent designated by the Board in connection with a Reorganization Event and except that a SAR granted with respect
to less than the full number of shares covered by an Option will not be reduced until the number of shares as to which the related
Option has been exercised or has terminated exceeds the number of shares not covered by the SAR; (iii) the Option will terminate
and no longer be exercisable upon the exercise of the related SAR; and (iv) the SAR will be transferable only with the related
Option.
(2)
Independent SARs. A SAR not expressly granted in tandem with an Option will become exercisable at such time
or times, and on such conditions, as the Board may specify in the SAR Award.
(c)
Measurement Price. The Board shall establish the measurement price of each SAR and specify it in the applicable
SAR agreement. The measurement price shall not be less than 100% of the Fair Market Value on the date the SAR is granted;
provided that if the Board approves the grant of a SAR with a measurement price to be determined on a future date, the measurement
price shall be not less than 100% of the Fair Market Value on such future date.
(d)
Duration of SARs. Each SAR shall be exercisable at such times and subject to such terms and conditions as the
Board may specify in the applicable SAR agreement; provided, however, that no SAR will be granted with a term in excess
of 10 years.
(e)
Exercise of SARs. SARs may be exercised by delivery to the Company of a written notice of exercise signed by
the proper person or by any other form of notice (including electronic notice) approved by the Company, together with any other
documents required by the Board.
7.
Restricted Stock; Restricted Stock Units
(a)
General. The Board may grant Awards entitling recipients to acquire shares of Common Stock (“Restricted
Stock”), subject to the right of the Company to repurchase all or part of such shares at their issue price or other
stated or formula price (or to require forfeiture of such shares if issued at no cost) from the recipient in the event that conditions
specified by the Board in the applicable Award are not satisfied prior to the end of the applicable restriction period or periods
established by the Board for such Award. Instead of granting Awards for Restricted Stock, the Board may grant Awards entitling
the recipient to receive shares of Common Stock or cash to be delivered at the time such Award vests (“Restricted Stock
Units”) (Restricted Stock and Restricted Stock Units are each referred to herein as a “Restricted Stock
Award”).
(b)
Terms and Conditions for All Restricted Stock Awards. The Board shall determine the terms and conditions of
a Restricted Stock Award, including the conditions for vesting and repurchase (or forfeiture) and the issue price, if any.
(c)
Additional Provisions Relating to Restricted Stock.
(1)
Dividends. Participants holding shares of Restricted Stock will be entitled to all ordinary cash dividends
paid with respect to such shares, unless otherwise provided by the Board. Unless otherwise provided by the Board, if any
dividends or distributions are paid in shares, or consist of a dividend or distribution to holders of Common Stock other than an
ordinary cash dividend, the shares, cash or other property will be subject to the same restrictions on transferability and forfeitability
as the shares of Restricted Stock with respect to which they were paid. Each dividend payment will be made no later than
the end of the calendar year in which the dividends are paid to shareholders of that class of stock or, if later, the 15th day
of the third month following the date the dividends are paid to shareholders of that class of stock.
(2)
Stock Certificates. The Company may require that any stock certificates issued in respect of shares of Restricted
Stock shall be deposited in escrow by the Participant, together with a stock power endorsed in blank, with the Company (or its
designee). At the expiration of the applicable restriction periods, the Company (or such designee) shall deliver the certificates
no longer subject to such restrictions to the Participant or if the Participant has died, to the beneficiary designated, in a manner
determined by the Board, by a Participant to receive amounts due or exercise rights of the Participant in the event of the Participant’s
death (the “Designated Beneficiary”). In the absence of an effective designation by a Participant,
“Designated Beneficiary” shall mean the Participant’s estate.
(d)
Additional Provisions Relating to Restricted Stock Units.
(1)
Settlement. Upon the vesting of and/or lapsing of any other restrictions (i.e., settlement) with respect to
each Restricted Stock Unit, the Participant shall be entitled to receive from the Company one share of Common Stock or an amount
of cash equal to the Fair Market Value of one share of Common Stock, as provided in the applicable Award agreement. The Board
may, in its discretion, provide that settlement of Restricted Stock Units shall be deferred, on a mandatory basis or at the election
of the Participant in a manner that complies with Code Section 409A.
(2)
Voting Rights. A Participant shall have no voting rights with respect to any Restricted Stock Units.
(3)
Dividend Equivalents. To the extent provided by the Board, in its sole discretion, a grant of Restricted Stock
Units may provide Participants with the right to receive an amount equal to any dividends or other distributions declared and paid
on an equal number of outstanding shares of Common Stock (“Dividend Equivalents”). Dividend Equivalents
may be paid currently or credited to an account for the Participants, may be settled in cash and/or shares of Common Stock and
may be subject to the same restrictions on transfer and forfeitability as the Restricted Stock Units with respect to which paid,
as determined by the Board in its sole discretion, subject in each case to such terms and conditions as the Board shall establish,
in each case to be set forth in the applicable Award agreement.
8.
Other Stock-Based Awards
(a)
General. Other Awards of shares of Common Stock, and other Awards that are valued in whole or in part by reference
to, or are otherwise based on, shares of Common Stock or other property, may be granted hereunder to Participants (“Other
Stock-Based-Awards”), including without limitation Awards entitling recipients to receive shares of Common Stock
to be delivered in the future. Such Other Stock-Based Awards shall also be available as a form of payment in the settlement
of other Awards granted under the Plan or as payment in lieu of compensation to which a Participant is otherwise entitled.
Other Stock-Based Awards may be paid in shares of Common Stock or cash, as the Board shall determine.
(b)
Terms and Conditions. Subject to the provisions of the Plan, the Board shall determine the terms and conditions
of each Other Stock-Based Award, including any purchase price applicable thereto.
9.
Adjustments for Changes in Common Stock and Certain Other Events
(a)
Changes in Capitalization. In the event of any stock split, reverse stock split, stock dividend, recapitalization,
combination of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any dividend
or distribution to holders of Common Stock other than an ordinary cash dividend, (i) the number and class of securities available
under the Plan, (ii) share counting rules set forth in Sections 4(a), (iii) the number and class of securities and exercise price
per share of each outstanding Option, (iv) the share- and per-share provisions and the measurement price of each SAR, (v) the number
of shares subject to and the repurchase price per share subject to each outstanding Restricted Stock Award and (vi) the share-
and per-share-related provisions and the purchase price, if any, of each outstanding Other Stock-Based Award, shall be equitably
adjusted by the Company (or substituted Awards may be made, if applicable) in the manner determined by the Board. Without
limiting the generality of the foregoing, in the event the Company effects a split of the Common Stock by means of a stock dividend
and the exercise price of and the number of shares subject to an outstanding Option are adjusted as of the date of the distribution
of the dividend (rather than as of the record date for such dividend), then an optionee who exercises an Option between the record
date and the distribution date for such stock dividend shall be entitled to receive, on the distribution date, the stock dividend
with respect to the shares of Common Stock acquired upon such Option exercise, notwithstanding the fact that such shares were not
outstanding as of the close of business on the record date for such stock dividend.
(b)
Reorganization Events.
(1)
Definition. A “Reorganization Event” shall mean: (a) any merger or consolidation
of the Company with or into another entity as a result of which all of the Common Stock of the Company is converted into or exchanged
for the right to receive cash, securities or other property or is cancelled, (b) any transfer or disposition of all of the Common
Stock of the Company for cash, securities or other property pursuant to a share exchange or other transaction or (c) any liquidation
or dissolution of the Company.
(2)
Consequences of a Reorganization Event on Awards Other than Restricted Stock Awards. In connection with a Reorganization
Event, the Board may take any one or more of the following actions as to all or any (or any portion of) outstanding Awards other
than Restricted Stock Awards on such terms as the Board determines: (i) provide that Awards shall be assumed, or substantially
equivalent Awards shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written
notice to a Participant, provide that the Participant’s unexercised Awards will terminate immediately prior to the consummation
of such Reorganization Event unless exercised by the Participant within a specified period following the date of such notice, (iii)
provide that outstanding Awards shall become exercisable, realizable, or deliverable, or restrictions applicable to an Award shall
lapse, in whole or in part prior to or upon such Reorganization Event, (iv) in the event of a Reorganization Event under the terms
of which holders of Common Stock will receive upon consummation thereof a cash payment for each share surrendered in the Reorganization
Event (the “Acquisition Price”), make or provide for a cash payment to a Participant equal to the excess,
if any, of (A) the Acquisition Price times the number of shares of Common Stock subject to the Participant’s Awards
(to the extent the exercise price does not exceed the Acquisition Price) over (B) the aggregate exercise price of all such outstanding
Awards and any applicable tax withholdings, in exchange for the termination of such Awards, (v) provide that, in connection with
a liquidation or dissolution of the Company, Awards shall convert into the right to receive liquidation proceeds (if applicable,
net of the exercise price thereof and any applicable tax withholdings) and (vi) any combination of the foregoing. In taking
any of the actions permitted under this Section 9(b), the Board shall not be obligated by the Plan to treat all Awards, all Awards
held by a Participant, or all Awards of the same type, identically.
For purposes of clause (i) above, an Option
shall be considered assumed if, following consummation of the Reorganization Event, the Option confers the right to purchase, for
each share of Common Stock subject to the Option immediately prior to the consummation of the Reorganization Event, the consideration
(whether cash, securities or other property) received as a result of the Reorganization Event by holders of Common Stock for each
share of Common Stock held immediately prior to the consummation of the Reorganization Event (and if holders were offered a choice
of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of Common Stock); provided,
however, that if the consideration received as a result of the Reorganization Event is not solely common stock of the acquiring
or succeeding corporation (or an affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation,
provide for the consideration to be received upon the exercise of Options to consist solely of common stock of the acquiring or
succeeding corporation (or an affiliate thereof) equivalent in value (as determined by the Board) to the per share consideration
received by holders of outstanding shares of Common Stock as a result of the Reorganization Event.
(3)
Consequences of a Reorganization Event on Restricted Stock Awards. Upon the occurrence of a Reorganization
Event other than a liquidation or dissolution of the Company, the repurchase and other rights of the Company under each outstanding
Restricted Stock Award shall inure to the benefit of the Company’s successor and shall, unless the Board determines otherwise,
apply to the cash, securities or other property which the Common Stock was converted into or exchanged for pursuant to such Reorganization
Event in the same manner and to the same extent as they applied to the Common Stock subject to such Restricted Stock Award; provided,
however, that the Board may provide for termination or deemed satisfaction of such repurchase or other rights under the
instrument evidencing any Restricted Stock Award or any other agreement between a Participant and the Company, either initially
or by amendment. Upon the occurrence of a Reorganization Event involving the liquidation or dissolution of the Company, except
to the extent specifically provided to the contrary in the instrument evidencing any Restricted Stock Award or any other agreement
between a Participant and the Company, all restrictions and conditions on all Restricted Stock Awards then outstanding shall automatically
be deemed terminated or satisfied.
10.
General Provisions Applicable to Awards
(a)
Transferability of Awards.
(1)
Awards shall not be sold, assigned, transferred, pledged or otherwise encumbered by the person to whom they are granted,
either voluntarily or by operation of law, except by will or the laws of descent and distribution or pursuant to a qualified domestic
relations order, and, during the life of the Participant, shall be exercisable only by the Participant; provided, however,
that the Board may permit or provide in an Award for the gratuitous transfer of the Award by the Participant to or for the benefit
of any immediate family member, family trust or other entity established for the benefit of the Participant and/or an immediate
family member thereof if, with respect to such proposed transferee, the Company would be eligible to use a Form S-8 for the registration
of the sale of the Common Stock subject to such Award under the Securities Act of 1933, as amended; provided, further,
that the Company shall not be required to recognize any such transfer until such time as the Participant and such permitted transferee
shall, as a condition to such transfer, deliver to the Company a written instrument in form and substance satisfactory to the Company
confirming that such transferee shall be bound by all of the terms and conditions of the Award. References to a Participant,
to the extent relevant in the context, shall include references to authorized transferees.
(2)
Notwithstanding anything contained in subsection (1) above to the contrary, no ISO granted under the Plan may be sold, transferred,
pledged, assigned or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution.
Further, all ISOs granted to a Participant under the Plan shall be exercisable during his or her lifetime only by such Participant
or the Participant’s legal representative (to the extent permitted under Section 422 of the Code).
(b)
Documentation. Each Award shall be evidenced in such form (written, electronic or otherwise) as the Board shall
determine. Each Award may contain terms and conditions in addition to those set forth in the Plan. Each Award agreement relating
to the grant of Options shall specify whether the Option is intended to be an ISO within the meaning of Section 422 of the Code,
or an NSO whose grant is not intended to fall under the provisions of Section 422 of the Code. In the event of a conflict
between any Option Award agreement and the Plan, the Plan shall control, and in no event shall the Board have the power to grant
an Option or execute an Option Award agreement that is contrary to the provisions of the Plan.
(c)
Board Discretion. Except as otherwise provided by the Plan, each Award may be made alone or in addition or
in relation to any other Award. The terms of each Award need not be identical, and the Board need not treat Participants
uniformly.
(d)
Termination of Status. The Board shall determine the effect on an Award of the disability, death, termination
or other cessation of employment, authorized leave of absence or other change in the employment or other status of a Participant
and the extent to which, and the period during which, the Participant, or the Participant’s legal representative, conservator,
guardian or Designated Beneficiary, may exercise rights under the Award.
(e)
Withholding. The Participant must satisfy all applicable federal, state, and local or other income and employment
tax withholding obligations before the Company will deliver stock certificates or otherwise recognize ownership of Common Stock
under an Award. The Company may decide to satisfy the withholding obligations through additional withholding on salary or
wages. If the Company elects not to or cannot withhold from other compensation, the Participant must pay the Company the
full amount, if any, required for withholding or have a broker tender to the Company cash equal to the withholding obligations.
Payment of withholding obligations is due before the Company will issue any shares on exercise or release from forfeiture of an
Award or, if the Company so requires, at the same time as payment of the exercise price unless the Company determines otherwise.
If provided for in an Award or approved by the Board in its sole discretion, a Participant may satisfy such tax obligations in
whole or in part by delivery (either by actual delivery or attestation) of shares of Common Stock, including shares retained from
the Award creating the tax obligation, valued at their Fair Market Value; provided, however, except as otherwise provided
by the Board, that the total tax withholding where stock is being used to satisfy such tax obligations cannot exceed the Company’s
minimum statutory withholding obligations (based on minimum statutory withholding rates for federal and state tax purposes, including
payroll taxes, that are applicable to such supplemental taxable income). Shares used to satisfy tax withholding requirements
cannot be subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements.
(f)
Amendment of Award. The Board may amend, modify or terminate any outstanding Award, including but not limited
to, substituting therefor another Award of the same or a different type and changing the date of exercise or realization.
The Participant’s consent to such action shall be required unless (i) the Board determines that the action, taking into account
any related action, would not materially and adversely affect the Participant’s rights under the Plan or (ii) the change
is permitted under Section 9 hereof.
(g)
Conditions on Delivery of Stock. The Company will not be obligated to deliver any shares of Common Stock pursuant
to the Plan or to remove restrictions from shares previously delivered under the Plan until (i) all conditions of the Award have
been met or removed to the satisfaction of the Company, (ii) in the opinion of the Company’s counsel, all other legal matters
in connection with the issuance and delivery of such shares have been satisfied, including any applicable securities laws and any
applicable stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company
such representations or agreements as the Company may consider appropriate to satisfy the requirements of any applicable laws,
rules or regulations.
(h)
Acceleration. The Board may at any time provide that any Award shall become immediately exercisable in full
or in part, free of some or all restrictions or conditions, or otherwise realizable in full or in part, as the case may be.
11.
Miscellaneous
(a)
No Right To Employment or Other Status. No person shall have any claim or right to be granted an Award, and
the grant of an Award shall not be construed as giving a Participant the right to continued employment or any other relationship
with the Company. The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship
with a Participant free from any liability or claim under the Plan, except as expressly provided in the applicable Award.
(b)
No Rights As Stockholder. Subject to the provisions of the applicable Award, no Participant or Designated Beneficiary
shall have any rights as a stockholder with respect to any shares of Common Stock to be distributed with respect to an Award until
becoming the record holder of such shares.
(c)
Effective Date and Term of Plan. The Plan shall become effective on the date the Plan is approved by the Company’s
Board of Directors (the “Effective Date”). No Awards shall be granted under the Plan after the
expiration of 10 years from the Effective Date, but Awards previously granted may extend beyond that date.
(d)
Amendment of Plan. The Board may amend, suspend or terminate the Plan or any portion thereof at any time provided
that to the extent required by Section 162(m), no Award granted to a Participant that is intended to comply with Section 162(m)
after the date of such amendment shall become exercisable, realizable or vested, as applicable to such Award, unless and until
the Company’s stockholders approve such amendment if required by Section 162(m) (including the vote required under Section
162(m)). Unless otherwise specified in the amendment, any amendment to the Plan adopted in accordance with this Section 12(d)
shall apply to, and be binding on the holders of, all Awards outstanding under the Plan at the time the amendment is adopted, provided
the Board determines that such amendment does not materially and adversely affect the rights of Participants under the Plan.
(e)
Authorization of Sub-Plans. The Board may from time to time establish one or more sub-plans under the Plan
for purposes of satisfying applicable securities or tax laws of various jurisdictions. The Board shall establish such sub-plans
by adopting supplements to the Plan containing (i) such limitations on the Board’s discretion under the Plan as the Board
deems necessary or desirable or (ii) such additional terms and conditions not otherwise inconsistent with the Plan as the Board
shall deem necessary or desirable. All supplements adopted by the Board shall be deemed to be part of the Plan, but each
supplement shall apply only to Participants within the affected jurisdiction and the Company shall not be required to provide copies
of any supplement to Participants in any jurisdiction which is not the subject of such supplement.
(f)
Non U.S. Employees. Awards may be granted to Participants who are non-U.S. citizens or residents employed outside
the United States, or both, on such terms and conditions different from those applicable to Awards to Participants employed in
the United States as may, in the judgment of the Board, be necessary or desirable in order to recognize differences in local law
or tax policy. The Board also may impose conditions on the exercise or vesting of Awards in order to minimize the Board’s
obligation with respect to tax equalization for Participants on assignments outside their home country. The Board may approve such
supplements to or amendments, restatements or alternative versions of the Plan as it may consider necessary or appropriate for
such purposes, without thereby affecting the terms of this Plan as in effect for any other purpose, and the Secretary or other
appropriate officer of the Company may certify any such document as having been approved and adopted in the same manner as this
Plan.
(g)
Compliance with Section 409A of the Code. Except as provided in individual Award agreements initially or by
amendment, if and to the extent any portion of any payment, compensation or other benefit provided to a Participant in connection
with his or her employment termination is determined to constitute “nonqualified deferred compensation” within the
meaning of Section 409A of the Code and the Participant is a specified employee as defined in Section 409A(a)(2)(B)(i) of the Code,
as determined by the Company in accordance with its procedures, by which determination the Participant (through accepting the Award)
agrees that he or she is bound, such portion of the payment, compensation or other benefit shall not be paid before the
day that is six months plus one day after the date of “separation from service” (as determined under Code Section 409A)
(the “New Payment Date”), except as Code Section 409A may then permit. The aggregate of any payments
that otherwise would have been paid to the Participant during the period between the date of separation from service and the New
Payment Date shall be paid to the Participant in a lump sum on such New Payment Date, and any remaining payments will be paid on
their original schedule.
The Company makes no representations or
warranty and shall have no liability to the Participant or any other person if any provisions of or payments, compensation or other
benefits under the Plan are determined to constitute nonqualified deferred compensation subject to Code Section 409A but do not
satisfy the conditions of that section.
(h)
Limitations on Liability. Notwithstanding any other provisions of the Plan, no individual acting
as a director, officer, other employee, or agent of the Company will be liable to any Participant, former Participant, spouse,
beneficiary, or any other person for any claim, loss, liability, or expense incurred in connection with the Plan, nor will such
individual be personally liable with respect to the Plan because of any contract or other instrument he or she executes in his
or her capacity as a director, officer, other employee, or agent of the Company. The Company will indemnify and hold
harmless each director, officer, other employee, or agent of the Company to whom any duty or power relating to the administration
or interpretation of the Plan has been or will be delegated, against any cost or expense (including attorneys’ fees) or liability
(including any sum paid in settlement of a claim with the Board’s approval) arising out of any act or omission to act concerning
this Plan unless arising out of such person’s own fraud or bad faith.
(i)
Governing Law. The provisions of the Plan and all Awards made hereunder shall be governed by and interpreted
in accordance with the laws of the State of Delaware, excluding choice-of-law principles of the law of such state that would require
the application of the laws of a jurisdiction other than such state.
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