exv4w1



 





Exhibit 4.1


CHOLESTECH CORPORATION




2000 STOCK INCENTIVE PROGRAM




(As Amended Effective July 2005)




     1. Purposes of the Plan. The purposes of this 2000 Stock Incentive Program are:




	 	•	 	to attract and retain the best available personnel for positions of
substantial responsibility,
	 
	 	•	 	to provide additional incentive to Employees, Directors and Consultants, and
	 
	 	•	 	to promote the success of the Company’s business.





          Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options,
as determined by the Administrator at the time of grant. Stock Purchase Rights may also be granted
under the Plan.




     2. Definitions. As used herein, the following definitions shall apply:



          (a) “Administrator” means the Board or any of its Committees as shall be administering
the Plan, in accordance with Section 4 of the Plan.




          (b) “Applicable Laws” means the requirements relating to the administration of stock
option plans under U. S. state corporate laws, U.S. federal and state securities laws, the Code,
any stock exchange or quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction where Options or Stock Purchase Rights are,
or will be, granted under the Plan.




          (c) “Board” means the Board of Directors of the Company.




          (d) “Code” means the Internal Revenue Code of 1986, as amended.




          (e) “Committee” means a committee of Directors appointed by the Board in accordance
with Section 4 of the Plan.




          (f) “Common Stock” means the common stock of the Company.




          (g) “Company” means Cholestech Corporation, a California corporation.




          (h) “Consultant” means any person, including an advisor, engaged by the Company or a
Parent or Subsidiary to render services to such entity.




          (i) “Determination Date” means the latest possible date that will not jeopardize the
qualification of a Stock Purchase Right granted under the Plan as “performance-based compensation”
under Section 162(m) of the Code.




 









 








          (j) “Director” means a member of the Board.




          (k) “Disability” means total and permanent disability as defined in Section 22(e)(3)
of the Code.




          (l) “Employee” means any person, including Officers and Directors, employed by the
Company or any Parent or Subsidiary of the Company. A Service Provider shall not cease to be an
Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between
locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. For
purposes of Incentive Stock Options, no such leave may exceed ninety days, unless reemployment upon
expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of
a leave of absence approved by the Company is not so guaranteed, on the 181st day of
such leave any Incentive Stock Option held by the Optionee shall cease to be treated as an
Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
Neither service as a Director nor payment of a director’s fee by the Company shall be sufficient to
constitute “employment” by the Company.




          (m) “Exchange Act” means the Securities Exchange Act of 1934, as amended.




          (n) “Fair Market Value” means, as of any date, the value of Common Stock determined as
follows:




               (i) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of
The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or
the closing bid, if no sales were reported) as quoted on such exchange or system on the day of
determination, as reported in The Wall Street Journal or such other source as the Administrator
deems reliable;



               (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling
prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between
the high bid and low asked prices for the Common Stock on the last market trading day prior to the
day of determination, as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or



               (iii) In the absence of an established market for the Common Stock, the Fair Market Value
shall be determined in good faith by the Administrator.



          (o) “Incentive Stock Option” means an Option intended to qualify as an incentive stock
option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.




          (p) “Inside Director” means a Director who is an Employee.




          (q) “Nonstatutory Stock Option” means an Option not intended to qualify as an
Incentive Stock Option.




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          (r) “Notice of Grant” means a written or electronic notice evidencing certain terms
and conditions of an individual Option or Stock Purchase Right grant. The Notice of Grant is part
of the Option Agreement.




          (s) “Officer” means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.




          (t) “Outside Director” means a Director who is not an Employee and who is not the
“beneficial owner” (as defined in Rule 13d-3 of the Securities Exchange Act of 1934, as amended),
directly or indirectly, of securities of the Company representing 1% or more of the total voting
power represented by the Company’s outstanding voting securities on the date of any grant
hereunder.




          (u) “Option” means a stock option granted pursuant to the Plan.




          (v) “Option Agreement” means an agreement between the Company and an Optionee
evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject
to the terms and conditions of the Plan.




          (w) “Option Exchange Program” means a program whereby outstanding Options are
surrendered in exchange for Options with a lower exercise price.




          (x) “Optioned Stock” means the Common Stock subject to an Option or Stock Purchase
Right.




          (y) “Optionee” means the holder of an outstanding Option or Stock Purchase Right
granted under the Plan.




          (z) “Parent” means a “parent corporation,” whether now or hereafter existing, as
defined in Section 424(e) of the Code.




          (aa) “Period of Restriction” means the period during which the transfer of Shares of
restricted stock acquired pursuant to the exercise of a Stock Purchase Right are subject to
restrictions and, therefore, the Shares are subject to a substantial risk of forfeiture. Such
restrictions may be based on the passage of time, the achievement of target levels of performance,
or the occurrence of other events as determined by the Administrator.




          (bb) “Plan” means this Cholestech Corporation 2000 Stock Incentive Program.




          (cc) “Restricted Stock” means shares of Common Stock acquired pursuant to a grant of
Stock Purchase Rights under Section 11 of the Plan.




          (dd) “Restricted Stock Purchase Agreement” means a written agreement between the
Company and the Optionee evidencing the terms and restrictions applying to stock purchased under a
Stock Purchase Right. The Restricted Stock Purchase Agreement is subject to the terms and
conditions of the Plan and the Notice of Grant.




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          (ee) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3,
as in effect when discretion is being exercised with respect to the Plan.




          (ff)
“Section 16(b)” means Section 16(b) of the Exchange Act.




          (gg)
“Service Provider” means an Employee, Director or Consultant.




          (hh) “Share” means a share of the Common Stock, as adjusted in accordance with Section
14 of the Plan.




          (ii) “Stock Purchase Right” means the right to purchase Common Stock pursuant to
Section 11 of the Plan, as evidenced by a Notice of Grant.




          (jj) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing,
as defined in Section 424(f) of the Code.




     3. Stock Subject to the Plan.



          (a) Stock Subject to the Plan. Subject to the provisions of Section 14 of the Plan,
the maximum aggregate number of Shares that may be optioned and sold under the Plan is two million
one hundred and forty-five thousand (2,145,000) Shares. The Shares may be authorized, but
unissued, or reacquired Common Stock.




          (b) Full Value Awards. Any Shares subject to Options will be counted against the
numerical limits of this Section 3 as one Share for every Share subject thereto. Any Shares
subject to Stock Purchase Rights with a per share purchase price lower than 100% of Fair Market
Value on the date of grant will be counted against the numerical limits of this Section 3 as two
Shares for every one Share subject thereto. To the extent that a Share that was subject to an
award that counted as two Shares against the Plan reserve pursuant to the preceding sentence is
recycled back into the Plan under the next paragraph of this Section 3, the Plan will be credited
with two Shares.




          (c) Lapsed Awards. If an Option or Stock Purchase Right expires or becomes
unexercisable without having been exercised in full, or is surrendered pursuant to an Option
Exchange Program, the unpurchased Shares which were subject thereto shall become available for
future grant or sale under the Plan (unless the Plan has terminated). Shares that have actually
been issued under the Plan, whether upon exercise of an Option or Stock Purchase Right, shall not
be returned to the Plan and shall not become available for future distribution under the Plan,
except that if Shares of restricted stock acquired pursuant to a Stock Purchase Right are
repurchased by the Company at the original purchase price or are forfeited to the Company, such
Shares shall become available for future grant under the Plan. Shares used to pay the exercise
price of an Option will not become available for future grant or sale under the Plan. Shares used
to satisfy tax withholding obligations will not become available for future grant or sale under the
Plan. Notwithstanding the foregoing and, subject to adjustment provided in Section 14, the maximum
number of Shares that may be issued upon the exercise of Incentive Stock Options will equal the
aggregate Share number stated in Section 3(a), plus, to the extent allowable under Section 422 of
the Code, any Shares that become available for issuance under the Plan under this Section 3(c).




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     4. Administration of the Plan.



          (a) Procedure.




               (i) Multiple Administrative Bodies. Different Committees with respect to different
groups of Service Providers may administer the Plan.



               (ii) Section 162(m). To the extent that the Administrator determines it to be
desirable to qualify Options or Stock Purchase Rights granted hereunder as “performance-based
compensation” within the meaning of Section 162(m) of the Code, the Plan shall be administered by a
Committee of two or more “outside directors” within the meaning of Section 162(m) of the Code.



               (iii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt
under Rule 16b-3, the transactions contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.



               (iv) Other Administration. Other than as provided above, the Plan shall be
administered by (A) the Board or (B) a Committee, which committee shall be constituted to satisfy
Applicable Laws.



          (b) Powers of the Administrator. Subject to the provisions of the Plan, and in the
case of a Committee, subject to the specific duties delegated by the Board to such Committee, the
Administrator shall have the authority, in its discretion:



               (i) to determine the Fair Market Value;



               (ii) to select the Service Providers to whom Options and Stock Purchase Rights may be granted
hereunder;



               (iii) to determine the number of shares of Common Stock to be covered by each Option and Stock
Purchase Right granted hereunder;



               (iv) to approve forms of agreement for use under the Plan;



               (v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any
Option or Stock Purchase Right granted hereunder. Such terms and conditions include, but are not
limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be
exercised (which may be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option or Stock Purchase
Right or the shares of Common Stock relating thereto, based in each case on such factors as the
Administrator, in its sole discretion, shall determine;



               (vi) to reduce the exercise price of any Option or Stock Purchase Right to the then current
Fair Market Value if the Fair Market Value of the Common Stock covered by such Option or Stock
Purchase Right shall have declined since the date the Option or Stock Purchase Right was granted;
provided, however, that such action is approved by the Company’s shareholders;



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               (vii) to institute an Option Exchange Program; provided, however, that such action is approved
by the Company’s shareholders;



               (viii) to construe and interpret the terms of the Plan and awards granted pursuant to the
Plan;



               (ix) to prescribe, amend and rescind rules and regulations relating to the Plan, including
rules and regulations relating to sub-plans established for the purpose of qualifying for preferred
tax treatment under foreign tax laws;



               (x) to modify or amend each Option or Stock Purchase Right (subject to Section 16(c) of the
Plan), including the discretionary authority to extend the post-termination exercisability period
of Options longer than is otherwise provided for in the Plan;



               (xi) to allow Optionees to satisfy withholding tax obligations by electing to have the Company
withhold from the Shares to be issued upon exercise of an Option or Stock Purchase Right that
number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair
Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to
be withheld is to be determined. All elections by an Optionee to have Shares withheld for this
purpose shall be made in such form and under such conditions as the Administrator may deem
necessary or advisable;



               (xii) to authorize any person to execute on behalf of the Company any instrument required to
effect the grant of an Option or Stock Purchase Right previously granted by the Administrator;



               (xiii) to make all other determinations deemed necessary or advisable for administering the
Plan.



          (c) Effect of Administrator’s Decision. The Administrator’s decisions, determinations
and interpretations shall be final and binding on all Optionees and any other holders of Options or
Stock Purchase Rights.




     5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may be granted
to Service Providers. Incentive Stock Options may be granted only to Employees.



     6. Limitations.



          (a) Each Option shall be designated in the Option Agreement as either an Incentive Stock
Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent
that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options
are exercisable for the first time by the Optionee during any calendar year (under all plans of the
Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as
Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive Stock Options shall be
taken into account in the order in which they were granted. The Fair Market Value of the Shares
shall be determined as of the time the Option with respect to such Shares is granted.




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          (b) Neither the Plan nor any Option or Stock Purchase Right shall confer upon an Optionee any
right with respect to continuing the Optionee’s relationship as a Service Provider with the
Company, nor shall they interfere in any way with the Optionee’s right or the Company’s right to
terminate such relationship at any time, with or without cause.




          (c) The following limitations shall apply to grants of Options:




               (i) No Service Provider shall be granted, in any fiscal year of the Company, Options to
purchase more than 300,000 Shares.



               (ii) In connection with his or her initial service, a Service Provider may be granted Options
to purchase up to an additional 300,000 Shares, which shall not count against the limit set forth
in subsection (i) above.



               (iii) The foregoing limitations shall be adjusted proportionately in connection with any
change in the Company’s capitalization as described in Section 14.



               (iv) If an Option is cancelled in the same fiscal year of the Company in which it was granted
(other than in connection with a transaction described in Section 14), the cancelled Option will be
counted against the limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a cancellation of the
Option and the grant of a new Option.



     7. Term of Plan. Subject to Section 20 of the Plan, the Plan shall become effective
upon its adoption by the Board. It shall continue in effect for a term of ten (10) years unless
terminated earlier under Section 16 of the Plan.



     8. Term of Option. The term of each Option shall be stated in the Option Agreement.
In the case of an Incentive Stock Option, the term shall be seven (7) years from the date of grant
or such shorter term as may be provided in the Option Agreement. Moreover, in the case of an
Incentive Stock Option granted to an Optionee who, at the time the Incentive Stock Option is
granted, owns stock representing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock
Option shall be five (5) years from the date of grant or such shorter term as may be provided in
the Option Agreement.



     9. Option Exercise Price and Consideration.



          (a) Exercise Price. The per share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be determined by the Administrator, subject to the following:




               (i) In the case of an Incentive Stock Option



                    (A) granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all classes of stock of the Company
or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.



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                    (B) granted to any Employee other than an Employee described in paragraph (A) immediately
above, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share
on the date of grant.



               (ii) In the case of a Nonstatutory Stock Option, the per Share exercise price shall be
determined by the Administrator but in no event shall be less than 100% of the Fair Market Value
per Share on the date of grant.



               (iii) Notwithstanding the foregoing, Options may be granted with a per Share exercise price of
less than 100% of the Fair Market Value per Share on the date of grant pursuant to a merger or
other corporate transaction.



          (b) Waiting Period and Exercise Dates. At the time an Option is granted, the
Administrator shall fix the period within which the Option may be exercised and shall determine any
conditions that must be satisfied before the Option may be exercised.




          (c) Form of Consideration. The Administrator shall determine the acceptable form of
consideration for exercising an Option, including the method of payment. In the case of an
Incentive Stock Option, the Administrator shall determine the acceptable form of consideration at
the time of grant. Such consideration may consist entirely of:




               (i) cash;



               (ii) check;



               (iii) other Shares which have a Fair Market Value on the date of surrender equal to the
aggregate exercise price of the Shares as to which said Option shall be exercised;



               (iv) consideration received by the Company under a cashless exercise program implemented by
the Company in connection with the Plan;



               (v) a reduction in the amount of any Company liability to the Optionee, including any
liability attributable to the Optionee’s participation in any Company-sponsored deferred
compensation program or arrangement;



               (vi) any combination of the foregoing methods of payment; or



               (vii) such other consideration and method of payment for the issuance of Shares to the extent
permitted by Applicable Laws.



     10. Exercise of Option.



          (a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder
shall be exercisable according to the terms of the Plan and at such times and under such conditions
as determined by the Administrator and set forth in the Option Agreement. Unless the Administrator
provides otherwise, vesting of Options granted hereunder shall be tolled during any unpaid leave of
absence. An Option may not be exercised for a fraction of a Share.




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               An Option shall be deemed exercised when the Company receives: (i) written or electronic
notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise
the Option, and (ii) full payment for the Shares with respect to which the Option is exercised.
Full payment may consist of any consideration and method of payment authorized by the Administrator
and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall
be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee
and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the Company), no right to vote or
receive dividends or any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued)
such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the Shares are issued, except as
provided in Section 14 of the Plan.



               Exercising an Option in any manner shall decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of Shares as to which
the Option is exercised.



          (b) Termination of Relationship as a Service Provider. If an Optionee ceases to be a
Service Provider, other than upon the Optionee’s death or Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement to the extent that
the Option is vested on the date of termination (but in no event later than the expiration of the
term of such Option as set forth in the Option Agreement). In the absence of a specified time in
the Option Agreement, the Option shall remain exercisable for three (3) months following the
Optionee’s termination. If, on the date of termination, the Optionee is not vested as to his or
her entire Option, the Shares covered by the unvested portion of the Option shall revert to the
Plan. If, after termination, the Optionee does not exercise his or her Option within the time
specified by the Administrator, the Option shall terminate, and the Shares covered by such Option
shall revert to the Plan.




          (c) Disability of Optionee. If an Optionee ceases to be a Service Provider as a
result of the Optionee’s Disability, the Optionee may exercise his or her Option within such period
of time as is specified in the Option Agreement to the extent the Option is vested on the date of
termination (but in no event later than the expiration of the term of such Option as set forth in
the Option Agreement). In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for twelve (12) months following the Optionee’s termination. If, on the
date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered
by the unvested portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.




          (d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may
be exercised within such period of time as is specified in the Option Agreement (but in no event
later than the expiration of the term of such Option as set forth in the Notice of Grant), by the
Optionee’s estate or by a person who acquires the right to exercise the Option by bequest or
inheritance, but only to the extent that the Option is vested on the date of death. In the absence
of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12)
months




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following the Optionee’s termination. If, at the time of death, the Optionee is not vested as
to his or her entire Option, the Shares covered by the unvested portion of the Option shall
immediately revert to the Plan. The Option may be exercised by the executor or administrator of
the Optionee’s estate or, if none, by the person(s) entitled to exercise the Option under the
Optionee’s will or the laws of descent or distribution. If the Option is not so exercised within
the time specified herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.




          (e) Buyout Provisions. The Administrator may at any time offer to buy out for a
payment in cash or Shares an Option previously granted based on such terms and conditions as the
Administrator shall establish and communicate to the Optionee at the time that such offer is made.




     11. Stock Purchase Rights.



          (a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition
to, or in tandem with other awards granted under the Plan and/or cash awards made outside of the
Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan,
it shall advise the offeree in writing or electronically, by means of a Notice of Grant, of the
terms, conditions and restrictions related to the offer, including the number of Shares that the
offeree shall be entitled to purchase, the price to be paid, and the time within which the offeree
must accept such offer. Notwithstanding the foregoing, during any fiscal year no Service Provider
will receive Stock Purchase Rights covering more than an aggregate of 150,000 Shares; provided,
however, that in connection with an individual’s initial service as an Employee, an Employee may be
granted an aggregate of up to an additional 150,000 Shares of Stock Purchase Rights. The offer
shall be accepted by execution of a Restricted Stock Purchase Agreement in the form determined by
the Administrator.




          (b) Repurchase Option. Unless the Administrator determines otherwise, the Restricted
Stock Purchase Agreement shall grant the Company a repurchase option exercisable upon the voluntary
or involuntary termination of the purchaser’s service with the Company for any reason (including
death or Disability). The purchase price for Shares repurchased pursuant to the Restricted Stock
Purchase Agreement shall be the original price paid by the purchaser and may be paid by
cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall
lapse at a rate determined by the Administrator; provided, however, that Shares of Restricted Stock
will vest no earlier than one-third (1/3rd) of the total number Shares of Restricted
Stock subject to a Stock Purchase Right each year from the date of grant, unless the Administrator
determines that the Stock Purchase Right is to vest upon the achievement of one or more performance
objectives, in which case the period for measuring performance will be at least twelve (12) months;
provided, further, that the foregoing vesting restrictions shall not apply to up to ten percent
(10%) of the Stock Purchase Rights issued by the Company over the term of the Plan.




          (c) Other Provisions. The Restricted Stock Purchase Agreement shall contain such
other terms, provisions and conditions not inconsistent with the Plan as may be determined by the
Administrator in its sole discretion.




          (d) Rights as a Shareholder. Once the Stock Purchase Right is exercised, the
purchaser shall have the rights equivalent to those of a shareholder, and shall be a shareholder
when his or her purchase is entered upon the records of the duly authorized transfer agent of the
Company.




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No adjustment will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 14 of the Plan.




          (e) Performance Goals. Awards of Stock Purchase Rights under the Plan may be made
subject to the attainment of performance goals relating to one or more business criteria within the
meaning of Section 162(m) of the Code and may provide for a targeted level or levels of achievement
(“Performance Goals”) including cash flow; cash position; earnings before interest and taxes;
earnings before interest, taxes, depreciation and amortization; earnings per Share; economic
profit; economic value added; equity or shareholder’s equity; market share; net income; net profit;
net sales; operating earnings; operating income; profit before tax; ratio of debt to debt plus
equity; ratio of operating earnings to capital spending; revenue; return on net assets; or total
return to shareholders. Any Performance Goals may be used to measure the performance of the
Company as a whole or a business unit of the Company and may be measured relative to a peer group
or index and may be stated in terms of growth of the applicable performance metric. The
Performance Goals for a Service Provider will be determined by the Administrator based on the
Company’s tactical and strategic business objectives, which may differ from Service Provider to
Service Provider and from Stock Purchase Right to Stock Purchase Right. Prior to the Determination
Date, the Administrator will determine whether to make any adjustments to the calculation of any
Performance Goal with respect to any Service Provider for any significant or extraordinary events
affecting the Company. In all other respects, Performance Goals will be calculated in accordance
with the Company’s financial statements, generally accepted accounting principles, or under a
methodology established by the Administrator prior to the issuance of a Stock Purchase Right, which
is consistently applied and identified in the financial statements, including footnotes, or the
management discussion and analysis section of the Company’s annual report.




     12. Non-Transferability of Options and Stock Purchase Rights. Unless determined
otherwise by the Administrator, an Option or Stock Purchase Right may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws
of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the
Optionee. If the Administrator makes an Option or Stock Purchase Right transferable, such Option
or Stock Purchase Right shall contain such additional terms and conditions as the Administrator
deems appropriate.



     13. Formula Option Grants to Outside Directors. Outside Directors shall be granted
Options each year in accordance with the following provisions:



          (a) All Options granted pursuant to this Section 13 shall be Nonstatutory Stock Options and,
except as otherwise provided herein, shall be subject to the other terms and conditions of the
Plan.




          (b) Except as provided in subsection (f) below, each person who first becomes an Outside
Director on or after the date that shareholders of the Company approve this Plan, whether through
election by the shareholders of the Company or appointment by the Board to fill a vacancy shall be
automatically granted an Option to purchase up to 20,000 Shares (the “First Option”), as determined
by the Board in its sole and absolute discretion, on the date he or she first becomes an Outside
Director; provided, however, that an Inside Director who ceases to be an Inside
Director but who remains a Director shall not receive a First Option.




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          (c) Except as provided in subsection (f) below, each Outside Director shall be automatically
granted an Option to purchase up to 10,000 Shares (a “Subsequent Option”) following each annual
meeting of the shareholders of the Company, if immediately after such meeting, he or she shall
continue to serve on the Board and shall have served on the Board for at least the preceding six
(6) months.




          (d) Except as provided in subsection (f) below, each Outside Director who acts as the Chairman
of the Board shall be automatically granted an Option to purchase up to 10,000 Shares (a “Chair
Option”) following each annual meeting of the shareholders of the Company, if immediately after
such meeting, he or she shall continue to serve as the Chairman of the Board.




          (e) Except as provided in subsection (f) below, each Outside Director who acts as the Chairman
of the Audit or Compensation Committee shall be automatically granted an Option to purchase up to
5,000 Shares (a “Committee Chair Option”) following each annual meeting of the shareholders of the
Company, if immediately after such meeting, he or she shall continue to serve as the Chairman of
such Committee.




          (f) Notwithstanding the provisions of subsections (b), (c), (d) and (e) hereof, any exercise
of an Option granted before the Company has obtained shareholder approval of the Plan in accordance
with Section 20 hereof shall be conditioned upon obtaining such shareholder approval of the Plan in
accordance with Section 20 hereof.




          (g) The terms of each First Option, Subsequent Option, Chair Option and Committee Chair Option
granted pursuant to this Section 13 shall be as follows:




                    (i) the term of each First Option, Subsequent Option, Chair Option and Committee Chair Option
shall be seven (7) years.



                    (ii) the exercise price per Share shall be 100% of the Fair Market Value per Share on the date
of grant of each First Option, Subsequent Option, Chair Option and Committee Chair Option. In the
event that the date of grant is not a trading day, the exercise price per Share shall be the Fair
Market Value on the next trading day immediately following the date of grant.



                    (iii) 100% of the Shares subject to each Subsequent Option, Chair Option and Committee Chair
Option shall vest (A) one year after the date of grant or (B) on the date of the subsequent annual
meeting of the shareholders of the Company, whichever is earlier, subject to the Optionee remaining
a Service Provider as of such vesting dates.



                    (iv) 25% of the Shares subject to the First Option shall vest one year after the date of grant
and 1/48 of the Shares subject to such option shall vest monthly thereafter, subject to the
Optionee remaining a Service Provider as of such vesting dates.



     14. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset Sale.



          (a) Changes in Capitalization. Subject to any required action by the shareholders of
the Company, the number of shares of Common Stock covered by each outstanding Option and Stock
Purchase Right, and the number of shares of Common Stock which have been authorized for issuance
under the Plan but as to which no Options or Stock Purchase Rights have yet been granted




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or which have been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each such outstanding
Option or Stock Purchase Right, shall be proportionately adjusted for any increase or decrease in
the number of issued shares of Common Stock resulting from a stock split, reverse stock split,
stock dividend, combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt of consideration
by the Company; provided, however, that conversion of any convertible securities of
the Company shall not be deemed to have been “effected without receipt of consideration.” Such
adjustment shall be made by the Board, whose determination in that respect shall be final, binding
and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock
of any class, or securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price of shares of Common
Stock subject to an Option or Stock Purchase Right.




          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable
prior to the effective date of such proposed transaction. The Administrator in its discretion may
provide for an Optionee to have the right to exercise his or her Option until ten (10) days prior
to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which
the Option would not otherwise be exercisable. In addition, the Administrator may provide that any
Company repurchase option applicable to any Shares purchased upon exercise of an Option or Stock
Purchase Right shall lapse as to all such Shares, provided the proposed dissolution or liquidation
takes place at the time and in the manner contemplated. To the extent it has not been previously
exercised, an Option or Stock Purchase Right will terminate immediately prior to the consummation
of such proposed action.




          (c) Merger or Asset Sale. In the event of a merger of the Company with or into
another corporation, or the sale of substantially all of the assets of the Company, each
outstanding Option and Stock Purchase Right (or unvested shares of Restricted Stock) shall be
assumed or an equivalent option or right or shares substituted by the successor corporation or a
Parent or Subsidiary of the successor corporation. In the event that the successor corporation
refuses to assume or substitute for the Option or Stock Purchase Right (or unvested shares of
Restricted Stock), the Optionee shall fully vest in and have the right to exercise the Option or
Stock Purchase Right (or unvested shares of Restricted Stock) as to all of the Optioned Stock or
such unvested shares, including Shares as to which it would not otherwise be vested or exercisable.
In addition, with respect to performance-based Stock Purchase Rights (or unvested shares of
Restricted Stock), all Performance Goals or other vesting criteria will be deemed achieved at
target levels and all other terms and conditions met. If an Option or Stock Purchase Right becomes
fully vested and exercisable in lieu of assumption or substitution in the event of a merger or sale
of assets, the Administrator shall notify the Optionee in writing or electronically that the Option
or Stock Purchase Right shall be fully vested and exercisable for a period of fifteen (15) days
from the date of such notice, and the Option or Stock Purchase Right shall terminate upon the
expiration of such period. For the purposes of this paragraph, the Option or Stock Purchase Right
(or unvested shares of Restricted Stock) shall be considered assumed if, following the merger or
sale of assets, the option or right or restricted stock confer the right to purchase or receive,
for each Share of Optioned Stock subject to the Option or Stock Purchase Right (or unvested shares
of Restricted Stock) immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or




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property) received in the merger or sale of assets by holders of Common Stock for each Share
held on the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger or
sale of assets is not solely common stock of the successor corporation or its Parent, the
Administrator may, with the consent of the successor corporation, provide for the consideration to
be received upon the exercise of the Option or Stock Purchase Right, for each Share of Optioned
Stock subject to the Option or Stock Purchase Right, or the vesting of the Restricted Stock, for
each Share of Restricted Stock, to be solely common stock of the successor corporation or its
Parent equal in fair market value to the per share consideration received by holders of Common
Stock in the merger or sale of assets.




     Notwithstanding anything in this Section 14(c) to the contrary, a Stock Purchase Right (or
unvested shares of Restricted Stock) that vests, is earned or paid-out upon the satisfaction of one
or more Performance Goals will not be considered assumed if the Company or its successor modifies
any of such Performance Goals without the Service Provider’s consent; provided, however, a
modification to such Performance Goals only to reflect the successor corporation’s post-merger or
asset sale corporate structure will not be deemed to invalidate an otherwise valid Stock Purchase
Right (or underlying Restricted Stock) assumption.



     15. Date of Grant. The date of grant of an Option or Stock Purchase Right shall be,
for all purposes, the date on which the Administrator makes the determination granting such Option
or Stock Purchase Right, or such other later date as is determined by the Administrator. Notice of
the determination shall be provided to each Optionee within a reasonable time after the date of
such grant.



     16. Amendment and Termination of the Plan.



          (a) Amendment and Termination. The Board may at any time amend, alter, suspend or
terminate the Plan.




          (b) Shareholder Approval. The Company shall obtain shareholder approval of any Plan
amendment to the extent necessary and desirable to comply with Applicable Laws. Without limiting
the foregoing sentence, the number of Shares available under the Plan pursuant to Section 3 herein
may not be increased without the approval of the Company’s shareholders, except as provided in
Section 3, and the class of Service Providers eligible under the Plan pursuant to Section 5 may not
be increased without approval of the Company’s shareholders.




          (c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise
between the Optionee and the Administrator, which agreement must be in writing and signed by the
Optionee and the Company. Termination of the Plan shall not affect the Administrator’s ability to
exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to
the date of such termination.




     17. Conditions Upon Issuance of Shares.



          (a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an
Option or Stock Purchase Right unless the exercise of such Option or Stock Purchase Right and the




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issuance and delivery of such Shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such compliance.




          (b) Investment Representations. As a condition to the exercise of an Option or Stock
Purchase Right, the Company may require the person exercising such Option or Stock Purchase Right
to represent and warrant at the time of any such exercise that the Shares are being purchased only
for investment and without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required.




     18. Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.



     19. Reservation of Shares. The Company, during the term of this Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.



     20. Shareholder Approval. The Plan shall be subject to approval by the shareholders
of the Company within twelve (12) months after the date the Plan is adopted. Such shareholder
approval shall be obtained in the manner and to the degree required under Applicable Laws.



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CHOLESTECH CORPORATION




2000 STOCK OPTION PLAN




STOCK OPTION AGREEMENT




     Unless otherwise defined herein, the terms defined in the Plan shall have the same
defined meanings in this Option Agreement.



I. NOTICE OF STOCK OPTION GRANT



Name

Address

City, State Zip



     You have been granted an option to purchase Common Stock of the Company, subject to the terms
and conditions of the Plan and this Option Agreement, as follows:



	 	 	 
	Date of Grant
	 	 
	 

	 	 
	 
	 	 
	Vesting Commencement Date
	 	 
	 

	 	 
	 
	 	 
	Exercise Price per Share
	 	 
	 

	 	 
	 
	 	 
	Total Number of Shares Granted
	 	 
	 

	 	 
	 
	 	 
	Total Exercise Price
	 	 
	 

	 	 
	 
	 	 
	Type of Option:

	 	 
	 

	 	 
	 
	 	 
	Term/Expiration Date:
	 	 
	 

	 	 
	 
	 	 
	Vesting Schedule:

	 	 
	 

	 	 






This Option may be exercised, in whole or in part, in accordance with the following schedule:




[Specific
vesting to be described.]



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     Termination Period:



     This Option may be exercised for three months after Optionee ceases to be a Service Provider.
Upon the death or disability of the Optionee, this Option may be exercised for twelve months
following Optionee’s termination as a Service Provider. In no event shall this Option be exercised
later than the Term/Expiration Date as provided above.



     II. AGREEMENT



     1. Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named
in the Notice of Grant attached as Part I of this Agreement (the “Optionee”) an option (the
“Option”) to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise
price per share set forth in the Notice of Grant (the “Exercise Price”), subject to the terms and
conditions of the Plan, which is incorporated herein by reference. Subject to Section 14(b) of the
Plan, in the event of a conflict between the terms and conditions of the Plan and the terms and
conditions of this Option Agreement, the terms and conditions of the Plan shall prevail.



     2. Exercise of Option.



     (a) Right to Exercise. This Option is exercisable during its term in accordance with the
Vesting Schedule set out in the Notice of Grant and the applicable provisions of the Plan and this
Option Agreement.



     (b) Method of Exercise. This Option is exercisable by delivery of an exercise notice, in the
form attached as Exhibit A (the “Exercise Notice”), which shall state the election to exercise the
Option, the number of Shares in respect of which the Option is being exercised (the “Exercised
Shares”), and such other representations and agreements as may be required by the Company pursuant
to the provisions of the Plan. The Exercise Notice shall be accompanied by payment of the
aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed to be exercised
upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate
Exercise Price.



     No Shares shall be issued pursuant to the exercise of this Option unless such issuance and
exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes, the
Exercised Shares shall be considered transferred to the Optionee on the date the Option is
exercised with respect to such Exercised Shares.



     3. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee:



     (a) Cash;



     (b) Check;



     (c) Consideration received by the Company under a cashless exercise program implemented by
the Company in connection with the Plan; or



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     (d) Surrender of other Shares which (i) in the case of Shares acquired upon exercise of an
option, have been owned by the Optionee for more than six (6) months on the date of surrender, and
(ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the
Exercised Shares.



     4. Non-Transferability of Option. This Option may not be transferred in any manner otherwise
than by will or by the laws of descent or distribution and may be exercised during the lifetime of
Optionee only by the Optionee. The terms of the Plan and this Option Agreement shall be binding
upon the executors, administrators, heirs, successors and assigns of the Optionee.



     5. Term of Option. This Option may be exercised only within the term set out in the Notice of
Grant, and may be exercised during such term only in accordance with the Plan and the terms of this
Option Agreement.



     6. Tax Consequences. Some of the federal tax consequences relating to this Option, as of the
date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS
AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING
THIS OPTION OR DISPOSING OF THE SHARES.



     (a) Exercising the Option. The Optionee may incur regular federal income tax liability upon
exercise of an NSO. The Optionee will be treated as having received compensation income (taxable
at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the
Exercised Shares on the date of exercise over their aggregate Exercise Price. If the Optionee is
an Employee or a former Employee, the Company will be required to withhold from his or her
compensation or collect from Optionee and pay to the applicable taxing authorities an amount in
cash equal to a percentage of this compensation income at the time of exercise, and may refuse to
honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at
the time of exercise.



     (b) Disposition of Shares. If the Optionee holds NSO Shares for at least one year, any gain
realized on disposition of the Shares will be treated as long-term capital gain for federal income
tax purposes.



     7. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan
and this Option Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and agreements of the
Company and Optionee with respect to the subject matter hereof, and may not be modified adversely
to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This
agreement is governed by the internal substantive laws, but not the choice of law rules, of
California.


8. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES
PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE
WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING
SHARES HEREUNDER). OPTIONEE FURTHER




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ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE
VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED
ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT
INTERFERE WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A
SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.




               By your signature and the signature of the Company’s representative below, you and the Company
agree that this Option is granted under and governed by the terms and conditions of the Plan and
this Option Agreement. Optionee has reviewed the Plan and this Option Agreement in their entirety,
has had an opportunity to obtain the advice of counsel prior to executing this Option Agreement and
fully understands all provisions of the Plan and Option Agreement. Optionee hereby agrees to
accept as binding, conclusive and final, all decision or interpretations of the Administrator upon
any questions relating to the Plan and Option Agreement. Optionee further agrees to notify the
Company upon any changes in the residence address indicated below.




	 	 	 
	OPTIONEE

	 	CHOLESTECH CORPORATION
	 
	 	 
	 
	 	 
	                                                                                

	 	                                                                                
	Signature

	 	By Terry Wassmann






	 	 	 
	 
	 	 
	                                                                                


	 	Vice President of Human
Resources                 
	Print Name

	 	Title






	 
	 

	                                                                                


	Residence Address






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