Rules of the Inverness Medical
Innovations, Inc.
2001 Stock Option and Incentive Plan
For the Grant of Options To Participants in
France
The Board of
Directors (the “Board”) of Inverness Medical
Innovations, Inc. (the “Company”) has established the
Inverness Medical Innovations, Inc. 2001 Stock Option and Incentive
Plan (the “U.S. Plan”) for the benefit of certain
eligible individuals, including employees of the Company and its
Subsidiaries, including its Subsidiary(ies) in France (each a
“French Subsidiary”), of which the Company holds
directly or indirectly at least 10% of the share
capital.
Section 2 of
the U.S. Plan authorizes the Board or any committee appointed by it
to administer the U.S. Plan (the “Administrator”) to do
all things necessary or desirable in connection with the
administration of the U.S. Plan. Specifically,
Section 2(b)(viii) of the U.S. Plan authorizes the
Administrator to adopt, alter and repeal such rules, guidelines and
practices for the administration of the U.S. Plan as it shall deem
advisable. The Administrator has determined that it is advisable to
establish a sub-plan for the purpose of permitting options granted
to employees of a French Subsidiary to qualify for favorable tax
and social security treatment in France. The Administrator,
therefore, intends with this document to establish a sub-plan of
the U.S. Plan for the purpose of granting options which qualify for
the favorable tax and social security treatment in France
applicable to options granted under Sections L. 225-177 to L.
225-186 of the French Commercial Code, as amended, to qualifying
employees of a French Subsidiary who are residents in France for
French tax purposes and/or subject to the French social security
regime (the “French Participants”).
The terms of the
U.S. Plan applicable to options, as set out in Appendix 1
hereto, as amended, shall, subject to the modifications in these
Rules of the Inverness Medical Innovations, Inc. 2001 Stock Option
and Incentive Plan for the Grant of Options To Participants in
France (the “French Plan”), constitute the terms
applicable to the grant of French-qualified Options to French
Participants.
Under the French
Plan, qualifying French Participants selected at the
Administrator’s discretion will be granted Options only as
defined in Section I.2 hereunder.
Capitalized terms
not otherwise defined herein shall have the same meanings as set
forth in the U.S. Plan. The terms set out below will have the
following meaning:
1
(a)
As of the date of adoption of this French Plan and as defined in
Section L. 225-197-1 of the French Commercial Code, as
amended, the term “Closed Period” shall mean
(i) ten quotation days preceding and following the disclosure
to the public of the consolidated financial statements or the
annual statements of the Company, or (ii) the period as from
the date the corporate management of the Company possesses
confidential information which could, if disclosed to the public,
significantly impact the quotation of the shares of the
Company’s Stock (“Shares”), until ten quotation
days after the day such information is disclosed to the public. If
the French Commercial Code is amended after adoption of this French
Plan to modify the definition and/or applicability of the Closed
Period to French-qualified Options, such amendment shall become
applicable to any French-qualified Options granted under this
French Plan, to the extent permitted or required by French
law.
(b)
The term “Disability” shall mean disability as
determined in categories 2 and 3 under Section L. 341-4 of the
French Social Security Code, as amended, and subject to the
fulfillment of related conditions.
(c)
The term “Forced Retirement” shall mean forced
retirement as determined under Section L. 122-14-13 of the
French Labor Code, as amended, and subject to the fulfillment of
related conditions.
(d)
The term “Grant Date” shall be the date on which the
Administrator both (i) designates the French Participants, and
(ii) specifies the main terms and conditions of the
French-qualified Options, such as the number of Shares subject to
the French-qualified Options.
(e)
The term “Option” shall include both:
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(i)
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purchase stock options (rights to
acquire Shares repurchased by the Company prior to the date on
which the Option becomes exercisable); and
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(ii)
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subscription stock options (rights
to subscribe for newly issued Shares).
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(a)
Subject to Section I.3(c) below, any individual who, on the
Grant Date of the French-qualified Option to the extent required
under French law, is employed under the terms and conditions of an
employment contract (“ contrat de travail ”) by
a French Subsidiary or who is a corporate officer of a French
Subsidiary (subject to Section I.3(b) below) shall be eligible
to receive, at the discretion of the Administrator,
French-qualified Options under this French Plan, provided he or she
also satisfies the eligibility conditions of Section 4 of the
U.S. Plan.
(b)
French-qualified Options may not be issued to a corporate officer
of a French Subsidiary, other than the managing corporate officers
( Président du Conseil
2
d’Administration, Directeur
Général, Directeur Général
Délégué, Membre du Directoire, Gérant
de Sociétés par actions ), unless the corporate officer is employed
under the terms and conditions of an employment contract (“
contrat de travail ”) by a French Subsidiary, as
defined by French law.
(c)
French-qualified Options may not be issued under the French Plan to
French Participants owning more than ten percent (10%) of the
Company’s share capital or to individuals other than
employees and corporate executives of a French Subsidiary, as set
forth in this Section I.3.
Notwithstanding
any provision in the U.S. Plan and except in the case of death,
French-qualified Options may not be transferred to any third party.
The French-qualified Options are exercisable only by the French
Participant during his or her lifetime, subject to Sections II.3(c)
and II.4 below.
5.
Disqualification of French-qualified Options
In the event
changes are made to the terms and conditions of the
French-qualified Options due to any requirements under applicable
laws, or by decision of the Company’s stockholders, the Board
or the Administrator, the Options may no longer qualify as
French-qualified Options. The Company does not undertake nor is it
required to maintain the French-qualified status of the Options,
and the French Participants understand, acknowledge and agree that
it will be their responsibility to bear any additional taxes that
may be payable as a result of the disqualification of the
French-qualified Options.
If the Options no
longer qualify as French-qualified Options, the Administrator may,
in its sole discretion, determine to lift, shorten or terminate
certain restrictions applicable to the vesting or exercisability of
the Options or the sale of the Shares underlying the Options which
have been imposed under this French Plan or in the applicable award
agreement delivered to the French Participant, in order to achieve
the favorable tax and social security treatment applicable to
French-qualified Options.
The adoption of
this French Plan shall not confer upon the French Participants, or
any employees of the French Subsidiary, an
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