EXHIBIT 99.3
INVERNESS SYSTEMS LTD. SUPPLEMENTAL STOCK OPTION PLAN
INVERNESS SYSTEMS LTD.
1997 SHARE OPTION PLAN AGREEMENT
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We are pleased to notify you that INVERNESS SYSTEMS LTD. (the "Company") has, on
September 22, 1997 (being hereinafter called the "Granting Date"), granted to
you Options (the "Options") to purchase Thirty Five Thousand (35,000) Ordinary
Shares, nominal value NTS 0.01 per share (the "Exercise Price"), under the
Company's 1997 Share Option Plan (hereinafter referred to as the "Plan"). These
options will not be subject to the restrictions of Section 102 of the Israel
Income Tax Ordinance. The Options are subject to the terms and conditions set
forth below.
1. EXECUTION OF OPTION AGREEMENT
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The Options are granted to you upon execution hereof, which execution does
not oblige you to purchase any of the Option Shares.
2. TERM OF OPTIONS AND EXERCISE OF OPTIONS
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2.1 The option will be exercisable (i.e., vest) subject to the provisions
hereof, over a period of three (3) years, as provided herein below:
(a) 33% of the Options upon the 12th month anniversary date of the
Granting Date provided that you are still an employee of the
Company on such date.
(b) additional 33% (totaling 66% of the Options) upon the 24th month
anniversary date of the Granting Date provided that you are still
an employee of the Company on such date.
(c) additional 34% (totaling 100% of the Options) upon the 36th month
anniversary date of the Granting Date provided that you are still
an employee of the Company on such date.
2.2 Subject to the provisions hereof, the Options shall be exercisable by
signing and returning to the Secretary of the Company a Notice of
Exercise in the form attached hereto as Exhibit A.
2.3 Upon exercise of the Options, in whole or in pat, each payment of the
Exercise Price shall be in respect of a whole number of Option Shares
only and shall be effected by cash payment or by a cashier's or
certified check payable to the order of the Company.
2.4 Until your exercise of the Options into the Option Shares you will not
be entitled to any rights as a shareholder of the Company in respect
of any Option shares, including any right to vote such shares.
2.5 If the Company is liquidated or dissolved while unexercised Options
remain outstanding pursuant to this Agreement, then all such
outstanding Options may be exercised in full as of the effective date
of any such liquidation or dissolution of the Company without regard
to the exercise provisions of this Section 2, upon your written notice
to the Company.
2.6 The Company may place a legend on each share certificate delivered
hereunder representing an Option Share, to the effect that such shares
were acquired pursuant to an investment representation and are subject
to limitations on offers, transfers and sales as provided hereunder
and under applicable laws.
3. TERMINATION OF EMPLOYMENT
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3.1 Subject to the provisions of Section 4 hereof, if you should die or
become totally disabled while in the employ of the Company or of a
subsidiary thereof, or if you should be discharged or resign from the
employ of the Company or of a subsidiary thereof, you, your estate or
your personal representative as the case may be, shall have the right,
for a period of three (3) months from the date of discharge or
resignation, to exercise any unexpired Options to the extent not
theretofore exercised, but only with respect to the number of shares
purchasable at the time of such termination (i.e., the number of
Options vested at such time), and to pay for any or all Option Shares
covered thereby, and to the extent that such rights are exercised as
provided herein, to receive a certificate therefor as provided in
Section 2 hereof.
3.2 In the event of your resignation or discharge from the employ of the
Company or a subsidiary, your employment shall, for the purpose of
Section 3(a) and 4, be deemed to have ceased upon the date of delivery
by your or to you of a written notice of resignation or discharge, as
the case may be.
3.3 Your transfer from the employ of the Company to a subsidiary (and vice
versa) or from the employ of a subsidiary of the Company to another
subsidiary thereof, shall not be deemed a termination of employment
for purposes thereof.
4. DISCHARGE FOR CAUSE
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Notwithstanding anything in Section 2 and 3 hereof the contrary if you
should be discharged from the employ of the Company or a subsidiary for
reasons of negligence in the discharge of your duties, breach of fiduciary
duty, willful cause of damage or loss to the Company in any fashion or
similar
or a subsidiary, all Options granted to you under the Plan and all Options
to which you may be entitled after the effective date of discharge shall
ipso facto expire and terminate.
5. ASSIGNABILITY
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Neither the Options nor the right to pay for the Option Shares and to
acquire certificates therefor, shall be assignable or transferable, except
by and to the extent permitted by testamentary disposition or pursuant to
the applicable laws of descent, and during your lifetime such rights shall
be exercised only by yourself.
6. DISPUTES
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Any dispute or disagreement which may arise under or as a result of or
pursuant to this Agreement shall be determined by the Company's Board of
Directors in its sole discretion and any interpretation by the Board of
Directors of the terms of this Agreement shall be final, binding and
conclusive.
7. ADJUSTMENTS
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7.1 If the Company is separated or reorganized, or merged, consolidated or
amalgamated with or into another corporation while unexercised or
unvested Options remain outstanding, there shall be substituted for
the shares subject to the unexercised or unvested portions of such
outstanding Options an appropriate number of shares of each class or
other securities of the separated or reorganized, or merged,
consolidated or amalgamated corporation which were distributed to the
shareholders of the Company in respect of such shares. All options
that are unvested at the time of such separation, reorganization,
merger, consolidation or amalgamation shall vest immediately thereon
and may be immediately exercised if you choose to do so, provide that
you supply the successor in interest of the Company (the "Successor")
with suitable commitments as to your continued employment with the
Successor if so requested by the Successor.
7.2 If the Company is liquidated or dissolved while unexercised Options
remain outstanding pursuant to this Agreement, then all such
outstanding Options may be exercised in full by you as of the
effective date of any such liquidation or dissolution of the Company
without regard to the exercise provisions of Paragraph 2, by you
giving notice in writing to the Company of your intention to so
exercise.
7.3 If the outstanding shares of the Company shall at any time be changed
or exchanged by declaration of bonus shares, stock split, combination
or exchange of shares, recapitalization, extraordinary dividend
payable in stock of a corporation other than the Company, or otherwise
in cash, or any other like event by or of the Company, and as often as
the same shall occur, then the number, class and kind of shares
subject to the Plan or subject to any Options granted, and the
Exercise Price shall be
shall occur, then the number, class and kind of shares subject to the
Plan or subject to any Options granted, and the Exercise Price shall
be appropriately and equitably adjusted so as to maintain the
proportionate number of Option Shares without changing the aggregate
Exercise Price; provided, however, that no adjustment shall be made by
reason of the distribution or subscription rights on outstanding
shares.
7.4 Except as provided in this Section 7, no adjustments shall be made for
dividends or other rights for which the record date shall be prior to
the issuance of a share certificate in respect of an Option Share.
8. CONTINUANCE OF EMPLOYMENT
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Neither the Plan nor the granting of the Options or this Agreement shall
impose any obligation on the Company or a subsidiary to continue your
employment and nothing in the Plan or in the Options granted to you
pursuant thereto or in this Agreement shall confer upon you any right to
continue in the employ of the Company or a subsidiary or to compensation in
respect of the expiration and termination of an Option or restrict your
right or the right of the Company or a subsidiary to terminate such
employment at any time.
9. TRANSFER OF SHARES
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Option Shares may be sold or otherwise transferred, subject to right of
first refusal of certain of the other Shareholders of the Company. Prior to
the sale of any of the Option Shares by you, you must provide a notice to
the Company 90 days before the proposed sale. Such notice shall specify the
number of Option Shares offered for sale, the identity of the Offeree and
the price and all other material terms of the proposed offer. The Company
shall then inform certain of the other shareholders of such terms and they
shall have 30 days to purchase some or all of the Shares to be sold by you
on the same terms as were described in the notice. If such first refusal
rights have not been exercised in respect of your shares proposed for sale
within 120 days of your notice to the Company, you shall be free to sell
such shares for 90 days thereafter on terms not more favorable to the
purchaser than were set forth in your notice to the Company.
10. TAX CONSEQUENCES
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10.1 You understood and acknowledge that any tax consequences resulting
from the grant or exercise of the Options, from payment for shares
underlying the Options or other event or act relating to the Options
or the Option Shares (by the Company, any subsidiary, or yourself)
shall be borne solely by you.
10.2 You hereby agree and undertake to indemnify the Company and its
subsidiaries and hold it and each of them harmless against and from
any tax liability, including interest and penalties thereon, which may
be
incurred as a result of the granting or exercise of an Option or the
issuance of Option Shares pursuant to such Options, or otherwise
arising out of this Agreement.
11. TERMS OF THE PLAN CONTROL
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This Agreement is issued under the Plan and is subject to all of the terms
and provisions of the Plan. In the event of any conflict between the terms
of this Agreement and that of the Plan, the terms of the Plan shall
prevail.
12. GOVERNING LAWS
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The Plan and all instruments issued thereunder, including but not limited
to this Agreement, shall be subject to, governed by and interpreted in
accordance with the laws of the State of Israel.
Sincerely,
INVERNESS SYSTEMS LTD.
