Exhibit 4.2
SILICOM LTD.
U.S. SHARE OPTION PLAN (2000)
A.
NAME AND PURPOSE
1.
Name : This plan, as amended from time to time, shall be
known as the Silicom Ltd. U.S. Share Option Plan (2000) (the
“Plan”).
2.
Purpose : The purpose and intent of the Plan is to provide
incentives to officers, consultants and certain other present and
future employees and directors (each, a “Service
Provider”) of Silicom Ltd. (the “Company”) and
its subsidiaries by providing them with opportunities to purchase
shares in the Company, pursuant to a plan approved by the Board of
Directors of the Company (the “Plan”). The Plan is
intended to comply with the provisions of the United States
Internal Revenue Code, as amended from time to time, and any
successor statute thereto (the “Code”). The Options to
purchase Ordinary Shares of the Company (the “Options”)
granted under the Plan may contain such terms as will qualify the
Options as Incentive Stock Options (“ISO”) within the
meaning of Section 422(b) of the Code.
The word
“Company” when used in the Plan with reference to
employment or retention of Service Providers, shall include
subsidiaries of the Company. The word “subsidiary”,
when used in the Plan, shall mean any corporation (other than the
Company) in an unbroken chain of corporations beginning with the
Company if, at the time of the granting of the option, each of the
corporations other than the last corporation in the unbroken chain
owns shares possessing 50 percent or more of the total combined
voting power of all classes of shares in one of the other
corporations in such chain.
B.
GENERAL TERMS AND CONDITIONS OF THE
PLAN
3.
Administration
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3.1
The Plan will be
administered by the Board of Directors of the Company, either
directly or upon the recommendation of a share option advisory
committee appointed and maintained by the Board for such purpose
(the “Committee” ). If appointed, the Committee
will consist of such number of Directors of the Company (not less
than two (2) in number), as may be fixed from time to time by the
Board of Directors of the Company. The Board of Directors shall
appoint the members of the Committee, may from time to time remove
members from, or add members to, the Committee and shall fill
vacancies in the Committee however caused. The Board of Directors
shall automatically have residual authority if no Committee is
appointed, or if such Committee ceases to operate for any reason
whatsoever. In such events, the term Committee, whenever used
herein, shall mean the Board of Directors of the
Company.
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3.2
Subject to the general
terms and conditions of this Plan, the Board of Directors shall
have sole authority, in its absolute discretion, to determine, and
the Committee, if any, shall have full power and authority to make
recommendations to the Board concerning (i) the Service Providers
to whom Option Awards (as hereinafter defined) shall be granted
(“Grantees”), (ii) the number of shares to be covered
by each Option Award, (iii) the time or times at which the same
shall be granted, (iv) the schedule and conditions on which such
Option Awards may be exercised and on which such shares shall be
paid for, and/or (v) any other matter which is necessary or
desirable for, or incidental to, the administration of the Plan. In
determining the number of shares covered by the Option Awards to be
granted to each Grantee, the Committee shall consider, among other
things, the Grantee’s salary and the duration of the
Grantee’s employment by the Company.
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3.3
The Board may from time
to time adopt such rules and regulations for carrying out the Plan
as it may deem best. No member of the Board of Directors or of the
Committee, if any, shall be liable for any action or determination
made in good faith with respect to the Plan or any Option Award
granted thereunder.
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3.4
The interpretation and
construction by the Committee of any provision of the Plan or of
any Option Award thereunder shall be final and conclusive unless
otherwise determined by the Board of Directors.
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4.
Eligible Grantees
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4.1
NISOs (as defined in
Section 6.3 below) may be granted to employees, Directors or
consultants of the Company or any parent or subsidiary of the
Company (“Service Providers”). ISOs (as defined in
Section 6.3 below) may be granted only to employees. Each Option
shall be designated in the Option Agreement as either an ISO or a
NISO. However, notwithstanding such designation, to the extent that
the aggregate Fair Market Value (as hereinafter defined) of the
Shares with respect to which ISOs are exercisable for the first
time by the Grantee during any calendar year (under all plans of
the Company and any parent or subsidiary) exceeds $100,000, such
Options shall be treated as NISOs. For purposes of this Section
4.1, ISOs shall be taken into account in the order in which they
were granted.
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4.2
Subject to any
restriction imposed by applicable law, Option Awards may be granted
to any officer, key employee or other employee, consultant or
contractor of the Company or any of its subsidiaries, whether or
not a Director of the Company or a subsidiary. The grant of an
Option Award to a Grantee hereunder, shall neither entitle such
Grantee to participate, nor disqualify the Grantee from
participating, in any other grant of options pursuant to this Plan
or any other share incentive or share option plan of the Company or
any of its subsidiaries.
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4.3
The “Fair Market
Value” shall mean the last reported sales price (as expressed
in dollars on the trading day immediately preceding the date of
grant) of the Ordinary Shares on the principal United States
national securities exchange on which the Ordinary Shares are
designated for trading, or if the Ordinary Shares are not
designated for trading on a United States national securities
exchange, on the National Association of Securities Dealers
Automated Quotations (“NASDAQ”) National Market System
or the SMALLCAP Market System, or, if the Ordinary Shares are not
designated for trading on the NASDAQ National Market System or the
SMALLCAP Market System, the average of the closing bid and asked
prices as reported on the NASDAQ System or, if not so reported, as
furnished by the National Quotation Bureau.
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5.
Reserved Shares : The Company has reserved 200,000
authorized but unissued Ordinary Shares (nominal value NIS 0.01 per
share) for purposes of the Plan, subject to adjustment as provided
in paragraph 11 hereof. Any shares under the Plan, in respect of
which the right hereunder of a Grantee to purchase the same shall
for any reason terminate, expire or otherwise cease to exist, shall
again be available for grant through Option Awards under the
Plan.
6.
Option Awards :
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6.1
The Board in its
discretion may award to Grantees options to purchase shares in the
Company available under the Plan (“Option Awards”).
Option Awards may be granted at any time after this Plan has been
approved by the Board of Directors of the Company and the shares
reserved for the Plan effectively created. The date of grant of
each Option Award shall be the date specified by the Board at the
time such award is made.
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6.2
The instrument granting
an Option Award shall state, inter alia, the number of shares
covered thereby, the dates when it may be exercised, the option
price, the schedule on which such shares may be paid for and such
other terms and conditions as the Board in its discretion may
prescribe, provided that they are consistent with this
Plan.
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6.3
Option Awards granted
under the Plan may be of two types: (i) Incentive Stock Options
(“ISO”) and (ii) Non-Incentive Stock Options
(“NISO”). ISO means any stock option intended to be and
designated as an “Incentive Stock Option” within
Section 422 of the Code; NISO means any stock option that is not an
ISO. To the extent that any Stock Option does not qualify as an
ISO, it shall constitute a corporate NISO.
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Anything in the
Plan to the contrary notwithstanding, no term of this Plan relating
to an ISO shall be interpreted, amended, or altered, nor shall any
discretion or authority granted under the Plan be so exercised, so
as to disqualify the Plan under Section 422 of the Code, or,
without the consent of the participant(s) affected, to disqualify
any ISO under such Section 422. |
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Options granted
under the Plan shall be subject to the following terms and
conditions and shall contain such additional terms and conditions,
not inconsistent with the terms of the Plan, as the Committee shall
deem appropriate: |
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(a)
Option Price. The
per share exercise price for the Shares to be issued upon exercise
of an Option shall be such price as is determined by the Committee
in accordance with applicable law. Notwithstanding the foregoing,
the option price per share purchasable under an ISO shall be not
less than 100% of the Fair Market Value of the stock at the time of
grant. However, any ISO granted to any participant who, at the time
the option was granted owns, in accordance with Section 424(d) of
the Code, more than 10% of the voting power of all classes of stock
of the Company or of a parent or subsidiary corporation shall have
an exercise price of no less than 110% of the Fair Market Value of
the Stock at the time of grant.
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(b)
Option Term. The
term of each ISO shall be fixed by the Committee, but no ISO shall
be exercisable more than ten years after the date the ISO is
granted. However, any ISO granted to any participant who, at the
time the option is granted owns, in accordance with Section 424(d)
of the Code, more than 10% of the voting power of all classes of
stock of the Company or of a parent or subsidiary corporation may
not have a term of more than five years. No option may be exercised
by any person after expiration of the term of the
option.
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(c)
Exercisability.
ISO’s shall be exercisable at such time or times and subject
to such terms and conditions as shall be determined by the
Committee at or after grant. If the Committee provides, in its
discretion, that any ISO is exercisable only in installments, the
Committee may waive such installment exercise provisions at any
time at or after grant in whole or in part, based on such factors
as the Committee shall determine in its sole discretion.
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(d)
Non-Transferability
of Options. No stock option (whether an ISO or NISO) shall be
transferable by the participant otherwise than by will or by the
laws of descent and distribution, and all stock options shall be
exercisable, during the participant’s lifetime, only by the
participant.
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(e)
Incentive Stock
Option Limitations. To the extent required for “Incentive
Stock Option” status under Section 422 of the Code, the
aggregate Fair Market Value (determined as of the time of grant) of
the stock with respect to which ISO’s are e
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