CARDIOGENESIS CORPORATION
DIRECTOR STOCK OPTION PLAN
(AS AMENDED THROUGH FEBRUARY
2009)
1.
Purpose of the Plan . The purposes of this Director Stock
Option Plan are to attract and retain the best available personnel
for service as Directors (as defined herein) of the Company, to
provide additional incentive to the Directors of the Company to
serve as Directors, and to encourage their continued service on the
Board.
All options
granted hereunder shall be nonstatutory stock options.
2.
Definitions . As used herein, the following definitions
shall apply:
(a)
“Board” means the Board of Directors of the
Company.
(b)
“Code” means the Internal Revenue Code of 1986, as
amended.
(c)
“Common Stock” means the Common Stock of the
Company.
(d)
“Company” means Cardiogenesis Corporation, formerly
known as Eclipse Surgical Technologies, Inc., a California
corporation.
(e)
“Continuous Status as a Director” means the absence of
any interruption or termination of service as a
Director.
(f)
“Director” means a member of the Board.
(g)
“Employee” means any person, including officers and
Directors, employed by the Company or any Parent or Subsidiary of
the Company. The payment of a Director’s fee by the Company
shall not be sufficient in and of itself to constitute
“employment” by the Company.
(h)
“Exchange Act” means the Securities Exchange Act of
1934, as amended.
(i)
“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 for the last market trading day
prior to the time 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 date of
determination, as reported in The Wall Street Journal or such other
source as the Board deems reliable, or;
(iii) In
the absence of an established market for the Common Stock, the Fair
Market Value thereof, shall be determined in good faith by the
Board.
(j)
“Option” means a stock option granted pursuant to the
Plan.
(k)
“Optioned Stock” means the Common Stock subject to an
Option.
(l)
“Optionee” means an Outside Director who receives an
Option.
(m)
“Outside Director” means a Director who is not an
Employee.
(n)
“Parent” means a “parent corporation,”
whether now or hereafter existing, as defined in Section 424(e) of
the Code.
(o)
“Plan” means this Director Stock Option
Plan.
(p)
“Share” means a share of the Common Stock, as adjusted
in accordance with Section 10 of the Plan.
(q)
“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 . Subject to the provisions of
Section 10 of the Plan, the maximum aggregate number of Shares
which may be optioned and sold under the Plan is 1,025,000 Shares
of Common Stock (the “ Pool ”). The Shares may
be authorized, but unissued, or reacquired Common Stock.
If an Option
expires or becomes unexercisable without having been exercised in
full, the unpurchased Shares which were subject thereto shall
become available for future grant or sale under the Plan (unless
the Plan has terminated); provided however, that Shares that have
actually been issued under the Plan shall not be returned to the
Plan and shall not become available for future distribution under
the Plan.
4.
Administration and Grants of Options under the Plan
.
(a)
Procedure for Grants . The provisions set forth in this
Section 4(a) shall not be amended more than once every six months,
other than to comport with changes in the Code, the Employee
Retirement Income Security Act of 1974, as amended, or the rules
thereunder. All grants of Options to Outside Directors under this
Plan shall be automatic and nondiscretionary and shall be made
strictly in accordance with the following provisions:
(i) No
person shall have any discretion to select which Outside Directors
shall be granted Options or to determine the number of Shares to
be, covered by Options granted to Outside Directors.
(ii) Each
Outside Director elected to the Board after February 23, 2009,
shall be automatically granted an Option to purchase 50,000 Shares
(a “ First Option ”).
2
(iii) Each
Outside Director shall be automatically granted an Option to
purchase 50,000 Shares (a “ Subsequent Option ”)
on the date of such Outside Director’s annual re-election to
the Board, if on such date, he or she shall have served on the
Board for at least six (6) months.
(iv) The
terms of a First Option granted hereunder shall be as
follows:
(A) the
term of the First Option shall be ten (10) years;
(B) the
exercise price per Share shall be the Fair Market Value per Share
on the date of grant of the First Option; and
(C) the
First Option shall become exercisable as to 1/3rd of the Shares
subject to the First Option on each of the first, second and third
anniversaries of the date of grant.
(v) The
terms of a Subsequent Option granted hereunder shall be as
follows:
(A) the
term of the Subsequent Option shall be ten
(10) years;
(B) the
exercise price per Share shall be the Fair Market Value per Share
on the date of grant of the Subsequent Option; and
(C) the
Subsequent Option shall become exercisable as to all of the Shares
subject to the Subsequent Option on the first anniversary of its
date of grant.
(vi) In
the event that any Option granted under the Plan would cause the
number of Shares subject to outstanding Options plus the number of
Shares previously purchased under Options to exceed the Pool, then
the remaining Shares available for Option grant shall be granted
under Options to the Outside Directors on a pro rata basis. No
further grants shall be made until such time, if any, as additional
Shares, become available for grant under the Plan through action of
the shareholders to increase the number of Shares which may be
issued under the Plan or through cancellation or expiration of
Options previously granted hereunder.
5.
Eligibility . Options may be granted only to Outside
Directors. All Options shall be automatically granted in accordance
with the terms of Section 4 hereof. An Outside Director who
has been granted an Option may, if he or she is otherwise eligible,
be granted an additional Option or Options in accordance with such
term.
Neither the Plan
nor any Option shall confer upon an Optionee any right to be
nominated or continue to serve as a Director, nor shall they
interfere in any way with any right that the Director or the
Company may have to terminate the Directors directorship at any
time.
6. Term
of Plan . The Plan shall become effective upon the earlier to
occur of the Plan’s adoption by the Board or it’s
approval by the shareholders of the Company as described in
Section 16 of the Plan; provided, however, that the Plan shall
be null and void if an underwritten, initial public offering of the
Company’s Common Stock does not occur before April 1,
1997. This Plan shall continue in effect until March 31, 2015
unless sooner terminated under Section 11 of the
Plan.
3
Termination of
this Plan shall not affect rights and obligations heretofore
granted under this Plan and then in effect.
7. Form
of Consideration . The consideration to be paid for the Shares
to be issued upon exercise of an Option, including the method of
payment, shall consist of (i) cash, (ii) check,
(iii)&
|
