Document:

Exhibit
10.2

 

RIGEL PHARMACEUTICALS, INC.

 

2000 NON-EMPLOYEE DIRECTORS’ STOCK
OPTION PLAN

 

ADOPTED AUGUST 18, 2000

APPROVED
BY STOCKHOLDERS SEPTEMBER 11, 2000

EFFECTIVE
DATE: DECEMBER 4, 2000

AMENDED
AND RESTATED APRIL 24, 2003

AMENDED
AND RESTATED JUNE 20, 2003

APPROVED
BY STOCKHOLDERS JUNE 20, 2003

AMENDED
AND RESTATED APRIL 22, 2005

APPROVED
BY STOCKHOLDERS JUNE 2, 2005

AMENDED
AND RESTATED JANUARY 31, 2007

APPROVED
BY STOCKHOLDERS MAY 31, 2007

AMENDED
AND RESTATED SEPTEMBER 18, 2007

AMENDED
AND RESTATED FEBRUARY 21, 2008

AMENDED
AND RESTATED MAY 19, 2009

1.                                           PURPOSES.

 

(a)                             Eligible Option
Recipients. The
persons eligible to receive Options are the Non-Employee Directors of the
Company.

 

(b)                             Available Options. The purpose of the Plan is to provide a
means by which Non-Employee Directors may be given an opportunity to benefit
from increases in value of the Common Stock through the granting of
Nonstatutory Stock Options.

 

(c)                             General Purpose. The Company, by means of the Plan,
seeks to retain the services of its Non-Employee Directors, to secure and
retain the services of new Non-Employee Directors and to provide incentives for
such persons to exert maximum efforts for the success of the Company and its
Affiliates.

 

1

 

2.                                           DEFINITIONS.

 

(a)                             “Affiliate” means, at the time of determination,
any “parent” or “subsidiary” of the Company as such terms are defined in Rule 405
of the Securities Act.  The Board shall
have the authority to determine the time or times at which “parent” or “subsidiary”
status is determined within the foregoing definition.

 

(b)                             “Annual
Grant” means
an Option granted annually to all Non-Employee Directors who meet the criteria
specified in subsection 6(b) of the Plan.

 

(c)                             “Annual
Meeting”
means the annual meeting of the stockholders of the Company.

 

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

 

(e)                               A “Change in Control,” with respect
to Options granted on or after the effective date of the Plan,
will be deemed to have occurred upon the first to occur of an event set forth
in any one of the following paragraphs:

 

(i)                                    the acquisition
(other than from the Company, by any person (as such term is defined in Section 13(c) or
14(d) of the Exchange Act of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of fifty (50%)
or more of the combined voting power of the Company’s then outstanding voting
securities; or

 

(ii)                                the closing of:

 

(a)                               a merger or
consolidation involving the Company if the stockholders of the Company,
immediately before such merger or consolidation, do not, as a result of such
merger or consolidation, own, directly or indirectly, more than fifty
percent (50%) of the combined voting power of the then outstanding voting
securities of the corporation resulting from such merger or consolidation in
substantially the same proportion as their ownership of the combined
voting power of the voting securities of the Company outstanding immediately
before such merger or consolidation; or

 

(b)                                a complete
liquidation or dissolution of the Company or an agreement for the sale or other
disposition of all or substantially all of the assets of the Company.

 

Notwithstanding the foregoing, a Change in Control
shall not be deemed to occur solely because fifty percent (50%) or more of the
combined voting power of the Company’s then outstanding securities is acquired
by (i) a trustee or other fiduciary holding securities under one or more 

 

2

 

employee benefit plans maintained by the Company or
any of its subsidiaries or (ii) any corporation which, immediately prior
to such acquisition, is owned directly or indirectly by the stockholders
of the Company in the same proportion as their ownership of stock in the
Company immediately prior to such acquisition.

 

For the avoidance of doubt,
the term Change in Control shall not include a sale of assets, merger or other
transaction effected exclusively for the purpose of changing the domicile of
the Company.

 

Notwithstanding the foregoing or any other provision
of this Plan, the definition of Change in Control (or any analogous term) in an
individual written agreement between the Company or any Affiliate and
the Optionholder shall supersede the foregoing definition with respect
to Options subject to such agreement; provided,
however, that if no definition of Change in Control or any analogous
term is set forth in such an individual written agreement, the foregoing
definition shall apply.

 

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

 

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

 

(h)                            “Company” means Rigel Pharmaceuticals, Inc.,
a Delaware corporation.

 

(i)                               “Consultant” means any person, including an advisor,
(i) engaged by the Company or an Affiliate to render consulting or
advisory services and who is compensated for such services or (ii) who is
a member of the Board of Directors of an Affiliate. However, the term “Consultant”
shall not include either Directors of the Company who are not compensated by
the Company for their services as Directors or Directors of the Company who are
merely paid a director’s fee by the Company for their services as Directors.

 

(j)                               “Continuous
Service”
means that the Optionholder’s service with the Company or an Affiliate, whether
as an Employee, Director or Consultant, is not interrupted or terminated. The
Optionholder’s Continuous Service shall not be deemed to have terminated merely
because of a change in the capacity in which the Optionholder renders service
to the Company or an Affiliate as an Employee, Consultant or Director or a
change in the entity for which the Optionholder renders such service, provided
that there is no interruption or termination of the Optionholder’s service. For
example, a change in status without interruption from a Non-Employee Director
of the Company to a Consultant of an Affiliate or an Employee of the Company
will not constitute an interruption of Continuous Service. The Board or the
chief executive officer of the Company, in that party’s sole discretion, may
determine whether 

 

3

 

Continuous Service
shall be considered interrupted in the case of any leave of absence approved by
that party, including sick leave, military leave or any other personal leave.

 

(k)                           “Director” means a member of the Board of
Directors of the Company.

 

(l)                               “Disability” means the permanent and total disability
of a person within the meaning of Section 22(e)(3) of the Code.

 

(m)                         “Employee” means any person employed by the
Company or an Affiliate. Mere service as a Director or payment of a director’s
fee by the Company or an Affiliate shall not be sufficient to constitute “employment”
by the Company or an Affiliate.

 

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

 

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

 

(i)                          If the Common Stock is listed on any
established stock exchange or traded on the Nasdaq National Market or the
Nasdaq SmallCap Market, the Fair Market Value of a share of Common Stock shall
be the closing sales price for such stock (or the closing bid, if no sales were
reported) as quoted on such exchange or market (or the exchange or market with
the greatest volume of trading in 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 Board deems reliable.

 

(ii)                      In the absence of such markets for the
Common Stock, the Fair Market Value shall be determined in good faith by the
Board.

 

(p)                             “Initial
Grant” means
an Option granted to a Non-Employee Director who meets the criteria specified
in subsection 6(a) of the Plan.

 

(q)                             “IPO
Date” means
the effective date of the initial public offering of the Common Stock.

 

4

 

(r)                             “Non-Employee
Director”
means a Director who is not an Employee.

 

(s)                             “Nonstatutory
Stock Option”
means an Option not intended to qualify as an incentive stock option within the
meaning of Section 422 of the Code and the regulations promulgated
thereunder.

 

(t)                               “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.

 

(u)                            “Option” means a Nonstatutory Stock Option
granted pursuant to the Plan.

 

(v)                              “Option
Agreement”
means a written agreement between the Company and an Optionholder evidencing
the terms and conditions of an individual Option grant. Each Option Agreement
shall be subject to the terms and conditions of the Plan.

 

(w)                           “Optionholder” means a person to whom an Option is
granted pursuant to the Plan or, if applicable, such other person who holds an
outstanding Option.

 

(x)                             “Plan” means this Rigel Pharmaceuticals, Inc.
2000 Non-Employee Directors’ Stock Option Plan.

 

(y)                             “Rule 16b-3” means Rule 16b-3 promulgated under
the Exchange Act or any successor to Rule 16b-3, as in effect from time to
time.

 

(z)                             “Securities
Act” means
the Securities Act of 1933, as amended.

 

5

 

3.                                           ADMINISTRATION.

 

(a)                             Administration by Board. The Board shall administer the Plan.
The Board may not delegate administration of the Plan to a committee.

 

(b)                             Powers of Board. The Board shall have the power, subject
to, and within the limitations of, the express provisions of the Plan:

 

(i)                          To determine the provisions of each
Option to the extent not specified in the Plan.

 

(ii)                      To construe and interpret the Plan and
Options granted under it, and to establish, amend and revoke rules and
regulations for its administration. The Board, in the exercise of this power,
may correct any defect, omission or inconsistency in the Plan or in any Option
Agreement, in a manner and to the extent it shall deem necessary or expedient
to make the Plan fully effective.

 

(iii)                  To amend the Plan or an Option as
provided in Section 12.

 

(iv)                     To terminate or suspend the Plan as
provided in Section 13.

 

(v)                         Generally, to exercise such powers and to
perform such acts as the Board deems necessary or expedient to promote the best
interests of the Company that are not in conflict with the provisions of the
Plan.

 

(c)                             Effect of Board’s
Decision. All
determinations, interpretations and constructions made by the Board in good
faith shall not be subject to review by any person and shall be final, binding
and conclusive on all persons.

 

(d)                             Cancellation and
Re-Grant of Options.
Notwithstanding anything to the contrary in the Plan, neither the Board nor any
Committee shall have the authority to: (i) reprice any outstanding Option
under the Plan, (ii) cancel and re-grant any outstanding Option under the
Plan, or (iii) effect any other action that is treated as a repricing
under generally accepted accounting principles unless, in each case, the
stockholders of the Company have approved such an action within twelve (12)
months prior to such an event.

 

6

 

4.                                           SHARES SUBJECT TO THE
PLAN.

 

(a)                             Share Reserve. Subject to the provisions of Section 11
relating to adjustments upon changes in the Common Stock, the Common Stock that
may be issued pursuant to Options shall not exceed in the aggregate 435,000
shares of Common Stock, which number consists of (i) 33,333 shares of
Common stock initially reserved for issuance under the Plan plus (ii) 66,667
shares of Common stock approved by the Board in April 2003 and
subsequently approved by the Company’s stockholders plus (iii) 225,000
shares of Common Stock approved by the Board in April 2005 and
subsequently approved by the Company’s stockholders plus (iv) 110,000
shares of Common Stock approved by the Board in January 2007 and
subsequently approved by the Company’s stockholders.

 

(b)                             Reversion of Shares to
the Share Reserve.
If any Option shall for any reason expire or otherwise terminate, in whole or
in part, without having been exercised in full, the shares of Common Stock not
acquired under such Option shall revert to and again become available for
issuance under the Plan. If any shares subject to an Option are not delivered
to an Optionholder because the Option is exercised through a reduction of
shares subject to the Option ( i.e
.., “net exercised”), the number of shares that are not delivered to the
Optionholder shall not remain available for issuance under the Plan. If any
shares subject to an Option are not delivered to an Optionholder because such
shares are withheld in satisfaction of the withholding of taxes incurred in
connection with the exercise of an Option, the number of shares that are not
delivered to the Optionholder shall not remain available for subsequent
issuance under the Plan. If the exercise price of any Option is satisfied by
tendering shares of Common Stock held by the Optionholder (either by actual
delivery or attestation), then the number of shares so tendered shall not
remain available for subsequent issuance under the Plan.

 

(c)                             Source of Shares. The shares of Common Stock subject to
the Plan may be unissued shares or reacquired shares, bought on the market or
otherwise.

 

5.                                           ELIGIBILITY.

 

The Options as set forth in section 6 automatically shall be granted
under the Plan to all Non-Employee Directors who meet the specified criteria.

 

7

 

6.                                           NON-DISCRETIONARY
GRANTS.

 

(a)                             Initial Grants. Without any further action of the Board,
each person who is elected or appointed for the first time to be a Non-Employee
Director after the IPO Date automatically shall, upon the date of his or her
initial election or appointment to be a Non-Employee Director by the Board or
stockholders of the Company, be granted an Initial Grant to purchase twenty
thousand (20,000) shares of Common Stock on the terms and conditions set forth
herein.

 

(b)                             Annual Grants. Without any further action of the Board,
a Non-Employee Director shall be granted an Annual Grant as follows: On the day
following each Annual Meeting commencing with the Annual Meeting in 2001, each
person who is then a Non-Employee Director automatically shall be granted an
Annual Grant to purchase ten thousand (10,000) shares of Common Stock on the
terms and conditions set forth herein;
provided, however, that if the person has not been serving as a
Non-Employee Director for the entire period since the preceding Annual Meeting,
then the number of shares subject to the Annual Grant shall be reduced pro rata
for each full quarter prior to the date of grant during which such person did
not serve as a Non-Employee Director.

 

7.                                           OPTION PROVISIONS.

 

Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

 

(a)                             Term. No Option shall be exercisable after
the expiration of ten (10) years from the date it was granted.

 

(b)                             Exercise Price. The exercise price of each Option shall
be one hundred percent (100%) of the Fair Market Value of the stock subject to
the Option on the date the Option is granted. Notwithstanding the foregoing, an
Option may be granted with an exercise price lower than that set forth in the
preceding sentence if such Option is granted pursuant to an assumption or
substitution for another option in a manner satisfying the provisions of Section 424(a) of
the Code.

 

8

 

(c)          Consideration. The purchase price of stock acquired
pursuant to an Option may be paid, to the extent permitted by applicable
statutes and regulations, in any combination of the following methods:

 

(i)         By cash or check.

 

(ii)       Provided that at the time of exercise the
Common Stock is publicly traded and quoted regularly in The Wall Street Journal , by delivery to
the Company of shares of Common Stock that are owned free and clear of any
liens, claims, encumbrances or security interests, and that are valued at Fair
Market Value on the date of exercise. “Delivery” for these purposes shall
include delivery to the Company of the Optionholder’s attestation of ownership
of such shares of Common Stock in a form approved by the Company.
Notwithstanding the foregoing, the Optionholder may not exercise the Option by
tender to the Company of Common Stock to the extent such tender would violate
the provisions of any law, regulation or agreement restricting the redemption
of the Company’s stock.

 

(iii)      Provided that at the time of exercise the
Common Stock is publicly traded and quoted regularly in The Wall Street Journal , pursuant to a
program developed under Regulation T as promulgated by the Federal Reserve
Board that, prior to the issuance of Common Stock, results in either the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales
proceeds.

 

(iv)       By a “net exercise” arrangement pursuant
to which the Company will reduce the number of shares of Common Stock issued
upon exercise by the largest whole number of shares with a Fair Market Value
that does not exceed the aggregate exercise price;  provided, however,  that the Company shall accept a cash or other
payment from the Optionholder to the extent of any remaining balance of the
aggregate exercise price not satisfied by such holding back of whole shares;  provided,
further, however,  that shares
of Common Stock will no longer be outstanding under an Option and will not be exercisable
thereafter to the extent that (i) shares are used to pay the exercise
price pursuant to the “net exercise,” (ii) shares are delivered to the
Optionholder as a result of such exercise, and (iii) shares are withheld
to satisfy tax withholding obligations.

 

(d)          Transferability. The Board may, in its sole discretion,
impose such limitations on the transferability of Options as the Board shall
determine.  In the absence of such a
determination by the Board to the contrary, the following restrictions on the
transferability of Options shall apply:

 

9

 

(i)            Restrictions on Transfer. 
An Option shall not be transferable except by will or by the laws of
descent and distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder; provided, however,
that the Board may, in its sole discretion, permit transfer of the Option in a
manner that is not prohibited by applicable tax and securities laws upon the
Optionholder’s request.  Except as
explicitly provided herein, an Option may not be transferred for consideration.

 

(ii)           Domestic Relations Orders. 
Notwithstanding the foregoing, an Option may be transferred pursuant to
a domestic relations order.

 

(iii)         Beneficiary Designation. 
Notwithstanding the foregoing, the Optionholder may, by delivering
written notice to the Company, in a form provided by or otherwise satisfactory
to the Company and any broker designated by the Company to effect Option
exercises, designate a third party who, in the event of the death of the
Optionholder, shall thereafter be entitled to exercise the Option and receive
the Common Stock or other consideration resulting from such exercise.  In the absence of such a designation, the
executor or administrator of the Optionholder’s estate shall be entitled to
exercise the Option and receive the Common Stock or other consideration
resulting from such exercise.

 

(e)          Exercise
Schedule. The
Option shall be exercisable as the shares of Common Stock subject to the Option
vest.

 

(f)          Vesting
Schedule.

 

(i)         Each Option granted as an initial grant
shall vest in accordance with the schedule set forth below that results in a
shorter period of full vesting:

 

(1)      1/36th of the shares of Common Stock subject to the
Option shall vest each month after the date of grant over a period of three (3) years;
or

 

(2)      the Option shall vest in equal monthly
installments after the date of grant over a period commencing on the date that
the Optionholder is appointed for the first time to be a Non-Employee Director
by the Board and ending on the date of the Annual Meeting at which the
Optionholder is first scheduled to be considered for election to be a
Non-Employee Director by the stockholders of the Company.

 

10

 

(ii)       Each Option granted as an annual grant
before the Annual Meeting in 2008 shall vest such that 1/36th of the shares
of Common Stock subject to such Option shall vest each month after the date of
grant over a period of three (3) years; and each Option granted as an
annual grant on or after the Annual Meeting in 2008 shall vest such that 1/12  th  of the shares
of Common Stock subject to such Option shall vest each month after the date of
grant over a period of one (1) year.

 

(g)         Termination
of Continuous Service. In the event an Optionholder’s Continuous Service terminates (other
than upon the Optionholder’s death or Disability), the Optionholder may
exercise his or her Option (to the extent that the Optionholder was entitled to
exercise it as of the date of termination) but only within such period of time
ending on the earlier of (i) the date three (3) months following the
termination of the Optionholder’s Continuous Service, or (ii) the
expiration of the term of the Option as set forth in the Option Agreement. If,
after termination, the Optionholder does not exercise his or her Option within
the time specified in the Option Agreement, the Option shall terminate.

 

(h)         Extension
of Termination Date.
If the exercise of the Option following the termination of the Optionholder’s
Continuous Service (other than upon the Optionholder’s death or Disability)
would be prohibited at any time solely because the issuance of shares would
violate the registration requirements under the Securities Act, then the Option
shall terminate on the earlier of (i) the expiration of the term of the
Option set forth in subsection 7(a) or (ii) the expiration of a total
period of three (3) months (that need not be consecutive) after the
termination of the Optionholder’s Continuous Service during which the exercise
of the Option would not be in violation of such registration requirements.

 

(i)          Disability
of Optionholder.
In the event an Optionholder’s Continuous Service terminates as a result of the
Optionholder’s Disability, the Optionholder may exercise his or her Option (to
the extent that the Optionholder was entitled to exercise it as of the date of
termination), but only within such period of time ending on the earlier of (i) the
date twelve (12) months following such termination or (ii) the expiration
of the term of the Option as set forth in the Option Agreement. If, after
termination, the Optionholder does not exercise his or her Option within the
time specified herein, the Option shall terminate.

 

(j)          Death
of Optionholder.
In the event (i) an Optionholder’s Continuous Service terminates as a
result of the Optionholder’s death or (ii) the Optionholder dies within
the three-month period after the termination of the Optionholder’s Continuous
Service for a reason other than death, then the Option may be exercised (to the
extent the Optionholder was entitled to exercise the Option as of the date of
death) by the Optionholder’s estate, by a person who acquired the right to
exercise the Option by bequest or inheritance or by a person designated to
exercise the Option upon the Optionholder’s death, but only within the period
ending on the 

 

11

 

earlier of (1) the
date eighteen (18) months following the date of death or (2) the
expiration of the term of such Option as set forth in the Option Agreement. If,
after death, the Option is not exercised within the time specified herein, the
Option shall terminate.

 

8.             COVENANTS OF THE COMPANY.

 

(a)          Availability
of Shares. During
the terms of the Options, the Company shall keep available at all times the
number of shares of Common Stock required to satisfy such Options.

 

(b)          Securities
Law Compliance.
The Company shall seek to obtain from each regulatory commission or agency
having jurisdiction over the Plan such authority as may be required to grant
Options and to issue and sell shares of Common Stock upon exercise of the
Options; provided, however, that this undertaking shall not require the Company
to register under the Securities Act the Plan, any Option or any stock issued
or issuable pursuant to any such Option. If, after reasonable efforts, the
Company is unable to obtain from any such regulatory commission or agency the
authority which counsel for the Company deems necessary for the lawful issuance
and sale of stock under the Plan, the Company shall be relieved from any
liability for failure to issue and sell stock upon exercise of such Options
unless and until such authority is obtained.

 

9.             USE OF PROCEEDS FROM STOCK.

 

Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.

 

10.          MISCELLANEOUS.

 

(a)          Stockholder
Rights. No
Optionholder shall be deemed to be the holder of, or to have any of the rights
of a holder with respect to, any shares subject to such Option unless and until
such Optionholder has satisfied all requirements for exercise of the Option
pursuant to its terms.

 

12

 

(b)          No
Service Rights.
Nothing in the Plan or any instrument executed or Option granted pursuant
thereto shall confer upon any Optionholder any right to continue to serve the
Company as a Non-Employee Director or shall affect the right of the Company or
an Affiliate to terminate (i) the employment of an Employee with or
without notice and with or without cause, (ii) the service of a Consultant
pursuant to the terms of such Consultant’s agreement with the Company or an
Affiliate or (iii) the service of a Director pursuant to the Bylaws of the
Company or an Affiliate, and any applicable provisions of the corporate law of
the state in which the Company or the Affiliate is incorporated, as the case
may be.

 

(c)          Investment
Assurances. The
Company may require an Optionholder, as a condition of exercising or acquiring
stock under any Option, (i) to give written assurances satisfactory to the
Company as to the Optionholder’s knowledge and experience in financial and
business matters and/or to employ a purchaser representative reasonably
satisfactory to the Company who is knowledgeable and experienced in financial
and business matters and that he or she is capable of evaluating, alone or
together with the purchaser representative, the merits and risks of exercising
the Option; and (ii) to give written assurances satisfactory to the
Company stating that the Optionholder is acquiring the stock subject to the
Option for the Optionholder’s own account and not with any present intention of
selling or otherwise distributing the stock. The foregoing requirements, and
any assurances given pursuant to such requirements, shall be inoperative if (iii) the
issuance of the shares upon the exercise or acquisition of stock under the
Option has been registered under a then currently effective registration
statement under the Securities Act or (iv) as to any particular
requirement, a determination is made by counsel for the Company that such
requirement need not be met in the circumstances under the then applicable
securities laws. The Company may, upon advice of counsel to the Company, place
legends on stock certificates issued under the Plan as such counsel deems
necessary or appropriate in order to comply with applicable securities laws,
including, but not limited to, legends restricting the transfer of the stock.

 

(d)          Withholding
Obligations. The
Optionholder may satisfy any federal, state or local tax withholding obligation
relating to the exercise or acquisition of stock under an Option by any of the
following means (in addition to the Company’s right to withhold from any
compensation paid to the Optionholder by the Company) or by a combination of
such means:  (i) tendering a cash payment; (ii) authorizing the
Company to withhold shares from the shares of the Common Stock otherwise
issuable to the Optionholder as a result of the exercise or acquisition of
stock under the Option, provided, however, that no shares of Common Stock are
withheld with a value exceeding the minimum amount of tax required to be
withheld by law; or (iii) delivering to the Company owned and unencumbered
shares of the Common Stock.

 

(e)          Electronic Delivery. 
Any reference herein to a “written” agreement or document shall include
any agreement or document delivered electronically or posted on the Company’s
intranet.

 

13

 

11.          ADJUSTMENTS UPON CHANGES IN STOCK.

 

(a)          Capitalization
Adjustments. If
any change is made in the stock subject to the Plan, or subject to any Option,
without the receipt of consideration by the Company (through merger,
consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or other transaction not involving the receipt of consideration by the
Company), the Board shall appropriately and proportionately adjust (i) the
class(es) and maximum number of securities subject both to the Plan pursuant to
subsection 4(a) and to the nondiscretionary Options specified in Section 5,
(ii) the class(es) and number of securities and price per share of stock
subject to outstanding Options. The Board shall make such adjustments, and its
determination shall be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a transaction “without
receipt of consideration” by the Company.)

 

(b)           Corporate
Transaction. In
the event of (i) a sale, lease or other disposition of all or
substantially all of the securities or assets of the Company, (ii) a
merger or consolidation in which the Company is not the surviving corporation
or (iii) a reverse merger in which the Company is the surviving
corporation but the shares of Common Stock outstanding immediately preceding
the merger are converted by virtue of the merger into other property, whether
in the form of securities, cash or otherwise, then any surviving corporation or
acquiring corporation may assume any Options outstanding under the Plan or may
substitute similar Options (including an option to acquire the same consideration
paid to the stockholders in the transaction described in this subsection 11(b))
for those outstanding under the Plan. In the event no surviving corporation or
acquiring corporation assumes such Options or substitutes similar Options for
those outstanding under the Plan, then with respect to Options held by
Optionholders who are in Continuous Service immediately prior to such an event,
the vesting of such Options (and the time during which such Options may be
exercised) shall be accelerated in full, and the Options shall terminate if not
exercised at or prior to such event. With respect to any other Options
outstanding under the Plan, such Options shall terminate if not exercised prior
to such event.

 

(c)           Change
in Control.  Upon a Change in Control, all Options held by
each Optionholder whose Continuous Service has not terminated immediately prior
to the Change in Control shall become fully vested and exercisable immediately
prior to the effectiveness of such Change in Control.

 

14

 

12.          AMENDMENT OF THE PLAN AND OPTIONS.

 

(a)          Amendment
of Plan. The
Board at any time, and from time to time, may amend the Plan. However, except
as provided in Section 11 relating to adjustments upon changes in stock,
no amendment shall be effective unless approved by the stockholders of the
Company to the extent stockholder approval is necessary to satisfy the
requirements of Rule 16b-3 or any Nasdaq or securities exchange listing
requirements.

 

(b)          Stockholder
Approval. The
Board may, in its sole discretion, submit any other amendment to the Plan for
stockholder approval.

 

(c)          No
Impairment of Rights.
Rights under any Option granted before amendment of the Plan shall not be
impaired by any amendment of the Plan unless (i) the Company requests the
consent of the Optionholder and (ii) the Optionholder consents in writing.

 

(d)          Amendment
of Options. The
Board at any time, and from time to time, may amend the terms of any one or
more Options including, but not limited to, amendments to provide terms more
favorable than previously provided in the agreement evidencing an Option,
subject to any specified limits in the Plan that are not subject to Board
discretion; provided, however, that the rights under any Option shall not be impaired
by any such amendment unless (i) the Company requests the consent of the
Optionholder and (ii) the Optionholder consents in writing.

 

13.          TERMINATION OR SUSPENSION OF THE
PLAN.

 

(a)          Plan
Term. The Board
may suspend or terminate the Plan at any time. No Options may be granted under
the Plan while the Plan is suspended or after it is terminated.

 

(b)          No
Impairment of Rights.
Suspension or termination of the Plan shall not impair rights and obligations
under any Option granted while the Plan is in effect except with the written
consent of the Optionholder.

 

15

 

14.          EFFECTIVE DATE OF PLAN.

 

The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the stockholders of
the Company, which approval shall be within twelve (12) months before or after
the date the Plan is adopted by the Board.

 

15.          CHOICE OF LAW.

 

All questions concerning the construction, validity and interpretation
of this Plan shall be governed by the law of the State of Delaware, without
regard to such state’s conflict of laws rules.

 

16EXHIBIT 10.1

 

CHEMUNG
CANAL TRUST COMPANY

 

MASTER
NOTE

 

$8,000,000.00                                                                 ELMIRA,
NEW YORK

 

FEBRUARY 8, 2001

 

For value received, the
undersigned, HARDINGE, INC. (“Borrower promises to pay to the order of CHEMUNG
CANAL TRUST COMPANY (“Lender”), on demand or when due as provided herein, at
its office at One Chemung Canal Plaza, Elmira, New York, or at any other office
designated by Lender, the principal sum of EIGHT MILLION and NO/100
($8,000,000.00) Dollars, or so much thereof as shall equal the unpaid principal
amount of all advances made by Lender to Borrower, plus interest on the
principal amount outstanding from time to time.

 

This Note shall be
evidence of indebtedness and shall constitute the terms of payment by the
Borrower to the Lender of principal which may be borrowed, repaid and
reborrowed from time to time, it being understood that the Lender may, in its
sole discretion, decline in whole or in part to make any advance requested by
Borrower. The excess of borrowing over repayments shall be the principal
balance due hereunder from time to time and at any time.

 

The Lender may, in its
sole discretion, make an advance to the Borrower upon oral request. Each oral
request shall be conclusively presumed to have been made by a person authorized
by Borrower to do so, and any credit by the Lender of any advance to or for the
account of the Borrower shall establish the Borrower’s obligation to repay the
same in accordance with the terms of this Note. The Lender shall incur no
liability to any party by reason of making an advance upon an oral request. The
Lender will endeavor (but shall be under no obligation) to send to the Borrower
written confirmation of the date and amount of such advance, but its failure to
do so will not relieve the Borrower of its obligations hereunder, including its
obligation to repay the advance when due.

 

Each advance made to
Borrower shall be deposited in Borrower’s account at Chemung Canal Trust
Company, identified below. Any advance made hereunder shall be in an amount of
not less than $2,500.00.

 

Interest shall accrue at
a rate equal to the Prime Rate in effect from time to time. Prime Rate, as used
herein, shall mean the annual rate of interest announced by THE WALL STREET
JOURNAL, as THE WALL STREET JOURNAL Prime Rate. The rate of interest payable
hereunder shall change on each date on which a change in the Prime Rate becomes
effective. Interest will be calculated for the actual number of days on a
360-day basis

 

Advances in excess of
$500,000.00 designated for duration of one month or longer shall accrue
interest at a rate equal to the sum of the one-month London Interbank Offered
rate (LIBOR) in effect from time to time plus .50% per annum. The LIBOR rate as
used herein shall mean the annual rate of interest announced in the Wall Street
Journal. All advances will carry the LIBOR rate fixed for one month. All
advances under $500,000.00 and any advance paid prior to the one-month maturity
will have its interest rate revert to the Wall Street Journal Prime Rate. All
interest will be calculated for the actual number of days on a 360-day basis.

 

Lender may, at its sole
option, declare the entire balance of principal and accrued interest due and
payable at any time, and in that event, the Borrower will immediately pay the
entire balance in full.

 

All or any part of the
indebtedness evidenced by this Note may be paid without penalty at any time.

 

All payments shall be in
lawful money of the United States in immediately available funds.

 

If the Lender demands and
accepts partial payments, such demand or acceptance shall not be construed as a
waiver of the right to demand the entire unpaid balance due hereunder at any
time in accordance with the terms hereof. Any delay by the Lender in exercising
any rights hereunder shall not operate as a waiver of such rights.

 

The provisions of any
separate Security Agreement or mortgage executed by the Borrower shall become a
part of the terms of this Master Note.

 

 

If this item is checked,             ,
notwithstanding any other provision of this Note, the Borrower agrees that for
a period of           
consecutive days during each of Borrower’s fiscal years, there shall be no
principal balance and accrued interest outstanding under this Master Note.

 

Borrower, and endorsers
and guarantors hereof, waive any demand, presentment for payment, protest and
notice of protest for non-payment of this Note. This Note shall be governed by
the laws of the State of New York.

 

Borrower agrees to pay
all reasonable costs and expenses, including attorneys’ fees and disbursements
incurred by Lender in enforcing this Note.

 

HARDINGE
INC. 

ONE
HARDINGE DRIVE 

ELMIRA,
NEW YORK 14902-1507

 

	
   

  	
  BY:

  	
  /s/
  RICHARD L. SIMONS

  	
   

  
	
   

  	
  RICHARD
  L. SIMONS

  
	
   

  	
  EXECUTIVE
  VICE PRESIDENT/CHIEF FINANCIAL OFFICER

  

 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00161-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00161-of-00352.parquet"}]]