Exhibit 5
BIOFIELD CORP.
STOCK OPTION LETTER AGREEMENT FOR NON-EMPLOYEE DIRECTORS
TO: XXXXXX X. XXXXXXXXX
Pursuant to the Biofield Corp. (the "Company") 1996 Stock
Option Plan for Non-Employee Directors (the "Plan") this Letter
Agreement represents the nonqualified option for the purchase of
10,000 shares (post 2.04 for one reverse stock split effective
February 26, 1996) of the Company's common stock, $.001 par value, at
a post-split exercise price of $11 per share (the "exercise price"). A
copy of the Plan is attached and the provisions thereof, including,
without limitation, those relating to withholding taxes, are
incorporated into this Agreement by reference.
The terms of the option are as set forth in the Plan and in
this Agreement. The most important of the terms set forth in the Plan
are summarized as follows:
Term. The term of the option is ten years from date of
grant, unless sooner terminated.
Exercise. During your lifetime only you can exercise the
option. The Plan also provides for exercise of the option by the
personal representative of your estate or the beneficiary thereof
following your death. You may use the Notice of Exercise in the form
attached to this Agreement when you exercise the option.
Payment for Shares. The option may be exercised by the
delivery of cash or bank certified or cashier's checks.
Termination. The option will terminate upon the earlier of
ten years from the Date of Grant or one year from cessation of service
as a Director.
Transfer of Option. The option is not transferable except by
will or by the applicable laws of descent and distribution or pursuant
to a qualified domestic relations order.
Vesting. The option is vested according to the following
schedule:
Period of Optionee's Continuous
Relationship With the Company or
Affiliate From the Date the Portion of Total Option Which is
Option is Granted Exercisable
1 year 33%
2 years 33%
3 years 34%
Date of Grant. The date of grant of the option is as of
January 29, 1996.
YOUR PARTICULAR ATTENTION IS DIRECTED TO PARAGRAPH 5(d)(vi)
OF THE PLAN WHICH DESCRIBES CERTAIN IMPORTANT CONDITIONS RELATING TO
FEDERAL AND STATE SECURITIES LAWS THAT MUST BE SATISFIED BEFORE THE
OPTION CAN BE EXERCISED AND BEFORE THE COMPANY CAN ISSUE ANY SHARES TO
YOU. THE COMPANY HAS NO OBLIGATION TO REGISTER THE SHARES THAT WOULD
BE ISSUED UPON THE EXERCISE OF YOUR OPTION, AND IF IT NEVER REGISTERS
THE SHARES, YOU WILL NOT BE ABLE TO EXERCISE THE OPTION UNLESS AN
EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE PRESENT TIME,
EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE SECURITIES LAWS
ARE VERY LIMITED AND MIGHT BE UNAVAILABLE TO YOU PRIOR TO THE
EXPIRATION OF THE OPTION. CONSEQUENTLY, YOU MIGHT HAVE NO OPPORTUNITY
TO EXERCISE THE OPTION AND TO RECEIVE SHARES UPON SUCH EXERCISE. IN
ADDITION, YOU SHOULD CONSULT WITH YOUR TAX ADVISOR CONCERNING THE
RAMIFICATIONS TO YOU OF HOLDING OR EXERCISING YOUR OPTIONS OR HOLDING
OR SELLING THE SHARES UNDERLYING SUCH OPTIONS.
You understand that, during any period in which the shares
which may be acquired pursuant to your option are subject to the
provisions of Section 16 of the Securities Exchange Act of 1934, as
amended (and you yourself are also so subject), in order for your
transactions under the Plan to qualify for the exemption from Section
16(b) provided by Rule 16b-3, a total of six months must elapse
between the grant of the option and the sale of shares underlying the
option.
Please execute the Acceptance and Acknowledgment set forth
below on the enclosed copy of this Agreement and return it to the
undersigned.
Very truly yours,
Biofield Corp.
By: /s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title: Executive Vice President
General Counsel
ACCEPTANCE AND ACKNOWLEDGMENT
I, a resident of the State of ____________, accept the stock
option described above granted under the Biofield Corp. 1996 Stock
Option Plan for Non-Employee Directors, and acknowledge receipt of a
copy of this Agreement, including a copy of the Plan. I have read and
understand the Plan, including the provisions of Paragraph 5(d)(vi)
thereof.
Dated: ___________________
/s/ Xxxxxx X. Xxxxxxxxx
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Taxpayer I.D. Number Signature
By his or her signature below, the spouse of the Optionee,
if such Optionee is legally married as of the date of such Optionee's
execution of this Agreement, acknowledges that he or she has read this
Agreement and the Plan and is familiar with the terms and provisions
thereof, and agrees to be bound by all the terms and conditions of
this Agreement and the Plan.
Dated: ___________________
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Spouse's Signature
-----------------------------------------
Printed Name
NOTICE OF EXERCISE
The undersigned, pursuant to a nonqualified Stock Option Letter
Agreement for Non-Employee Directors (the "Agreement") between the
undersigned and Biofield Corp. (the "Company"), hereby irrevocably
elects to exercise purchase rights represented by the Agreement, and
to purchase thereunder shares (the "Shares") of the Company's common
stock, $.001 par value ("Common Stock"), covered by the Agreement and
herewith makes payment in full therefor.
1. If the sale of the Shares and the resale thereof has not,
prior to the date hereof, been registered pursuant to a registration
statement filed and declared effective under the Securities Act of
1933, as amended (the "Act"), the undersigned hereby agrees,
represents, and warrants that:
(a) the undersigned is acquiring the Shares for his or her
own account (and not for the account of others), for investment and
not with a view to the distribution or resale thereof;
(b) By virtue of his or her position, the undersigned has
access to the same kind of information which would be available in a
registration statement filed under the Act;
(c) the undersigned is a sophisticated investor;
(d) the undersigned understands that he or she may not sell
or otherwise dispose of the Shares in the absence of either (i) a
registration statement filed under the Act or (ii) an exemption from
the registration provisions thereof; and
(e) The certificates representing the Shares may contain a
legend to the effect of subsection (d) of this Section 1.
2. If the sale of the Shares and the resale thereof has been
registered pursuant to a registration statement filed and declared
effective under the Act, the undersigned hereby represents and
warrants that he or she has received the applicable prospectus and a
copy of the most recent annual report, as well as all other material
sent to stockholders generally.
3. The undersigned acknowledges that the number of shares of
Common Stock subject to the Agreement is hereafter reduced by the
number of shares of Common Stock represented by the Shares.
Very truly yours,
---------------------------------
(type name under signature line)
Social Security No.:
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Address:
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BIOFIELD CORP.
FORM OF STOCK OPTION LETTER AGREEMENT FOR NON-EMPLOYEE DIRECTORS
TO: Xxxxxx Xxxxxxxxx
Pursuant to the Biofield Corp. (the "Company") 1996 Stock
Option Plan for Non-Employee Directors (the "Plan") this Letter
Agreement represents the nonqualified option for the purchase of 2,500
shares of the Company's common stock, $0.01 par value, at a post-split
exercise price of $4.69 per share (the "exercise price"). A copy of
the Plan is attached and the provisions thereof, including, without
limitation, those relating to withholding taxes, are incorporated into
this Agreement by reference.
The terms of the option are as set forth in the Plan and
in this Agreement. The most important of the terms set forth in the
Plan are summarized as follows:
Term. The term of the option is ten years from date of grant,
unless sooner terminated.
Exercise. During your lifetime only you can exercise the
option. The Plan also provides for exercise of the option by the
personal representative of your estate or the beneficiary thereof
following your death. You may use the Notice of Exercise in the form
attached to this Agreement when you exercise the option.
Payment for Shares. The option may be exercised by the delivery
of cash or bank certified or cashier's checks.
Termination. The option will terminate upon the earlier of ten
years from the Date of Grant or one year from cessation of service as a
Director.
Transfer of Option. The option is not transferable except
by will or by the applicable laws of descent and distribution or
pursuant to a qualified domestic relations order.
Vesting. The option is fully vested as of the date hereof.
Date of Grant. The date of grant of the option is June 4, 1997.
YOUR PARTICULAR ATTENTION IS DIRECTED TO PARAGRAPH
5(D)(VI) OF THE PLAN WHICH DESCRIBES CERTAIN IMPORTANT CONDITIONS
RELATING TO FEDERAL AND STATE SECURITIES LAWS THAT MUST BE SATISFIED
BEFORE THE OPTION CAN BE EXERCISED AND BEFORE THE COMPANY CAN ISSUE
ANY SHARES TO YOU. THE COMPANY HAS NO OBLIGATION TO REGISTER THE
SHARES THAT WOULD BE ISSUED UPON THE EXERCISE OF YOUR OPTION, AND IF
IT NEVER REGISTERS THE SHARES, YOU WILL NOT BE ABLE TO EXERCISE THE
OPTION UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE
PRESENT TIME, EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE
SECURITIES LAWS ARE VERY LIMITED AND MIGHT BE UNAVAILABLE TO YOU PRIOR
TO THE EXPIRATION OF THE OPTION. CONSEQUENTLY, YOU MIGHT HAVE NO
OPPORTUNITY TO EXERCISE THE OPTION AND TO RECEIVE SHARES UPON SUCH
EXERCISE. IN ADDITION, YOU SHOULD CONSULT WITH YOUR TAX ADVISOR
CONCERNING THE RAMIFICATIONS TO YOU OF HOLDING OR EXERCISING YOUR
OPTIONS OR HOLDING OR SELLING THE SHARES UNDERLYING SUCH OPTIONS.
You understand that, during any period in which the
shares which may be acquired pursuant to your option are subject to
the provisions of Section 16 of the Securities Exchange Act of 1934,
as amended (and you yourself are also so subject), in order for your
transactions under the Plan to qualify for the exemption from Section
16(b) provided by Rule 16b-3, a total of six months must elapse
between the grant of the option and the sale of shares underlying the
option.
Please execute the Acceptance and Acknowledgment set forth
below on the enclosed copy of this Agreement and return it to the
undersigned.
Very truly yours,
BIOFIELD CORP.
BY:----------------------------------
XXXXXXX X. XXXXXXXXX
EXECUTIVE VICE PRESIDENT
GENERAL COUNSEL
BIOFIELD CORP.
1996 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
Adopted January 29, 1996
1. Purpose
The purpose of the Biofield Corp. 1996 Stock Option Plan for
Non-Employee Directors (the "Plan") is to promote the interests of
Biofield Corp. (the "Company") and its stockholders by increasing the
proprietary and vested interest of non-employee directors in the
growth and performance of the Company by granting such directors
options to purchase shares of Common Stock, par value $.001 per share
(the "Shares"), of the Company.
2. Administration
The Plan shall be administered by the Company's Board of
Directors (the "Board"). Subject to the provisions of the Plan, the
Board shall be authorized to interpret the Plan, to establish, amend,
and rescind any rules and regulations relating to the Plan and to make
all other determinations necessary or advisable for the administration
of the Plan; provided, however, that the Board shall have no
discretion with respect to the selection of directors to receive
options, the number of Shares subject to any such options, the
purchase price thereunder or the timing of grants of options under the
Plan. The determinations of the Board in the administration of the
Plan, as described herein, shall be final and conclusive. The
Secretary of the Company shall be authorized to implement the Plan in
accordance with its terms and to take such actions of a ministerial
nature as shall be necessary to effectuate the intent and purposes
thereof. The validity, construction and effect of the Plan and any
rules and regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware.
It is the intention of the Company that the Plan comply in
all respects with Rule 16b-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), to the extent applicable, and
in all events the Plan shall be construed in favor of its meeting the
requirements of Rule 16b-3. If any Plan provision is later found not
to be in compliance with such Rule, such provision shall be deemed
null and void. From and after the date that the Company first
registers a class of equity securities under Section 12 of the
Exchange Act, no director subject to Section 16 of the Exchange Act
may sell shares received upon the exercise of an option during the six
month period immediately following the grant of the option.
3. Eligibility
The class of individuals eligible to receive grants of
options under the Plan shall be directors of the Company who are not
employees of the Company or its affiliates and who have not, within
one year immediately preceding the determination of such director's
eligibility, received any award under any other plan of the Company or
its affiliates that entitles the participants therein to acquire
stock, stock options or stock appreciation rights of the Company or
its affiliates (other than any other plan under which participants'
entitlements are governed by provisions meeting the requirements of
Rule 16b-3(c)(2)(ii) promulgated under the Securities Exchange Act of
1934) ("Eligible Directors"). Any holder of an option granted
hereunder shall hereinafter be referred to as a "Participant."
4. Shares Subject to the Plan
Subject to adjustment as provided in Section 6, an aggregate
of 306,000 Shares shall be available for issuance upon the exercise of
options granted under the Plan. The Shares deliverable upon the
exercise of options may be made available from authorized but unissued
Shares or treasury Shares. If any option granted under the Plan shall
terminate for any reason without having been exercised, the Shares
subject to, but not delivered under, such option shall be available
for other options.
5. Grant, Terms and Conditions of Options
(a) Effective January 29, 1996, subject to approval of the
Plan by the stockholders of the Company, each Eligible Director has
been granted an option hereunder to purchase 20,400 Shares. The
options granted to such Eligible Directors shall be subject to vesting
in three equal annual installments on the first three anniversary
dates of the date of grant; provided, that only whole shares may be
issued pursuant to the exercise of any option.
(b) Upon first election or appointment to the Board, each
newly elected Eligible Director will be granted an option to purchase
20,400 Shares. Any such options granted to newly elected Eligible
Directors shall be subject to vesting in three equal annual
installments on the first three anniversary dates of the election of
such Eligible Director to the Board; provided, that only whole shares
may be issued pursuant to the exercise of any option.
(c) Immediately following each Annual Stockholders Meeting,
commencing with the meeting following the close of fiscal year 1996,
each Eligible Director, other than an Eligible Director first elected
to the Board within the 12 months immediately preceding and including
such meeting, will be granted an option to purchase 5,100 Shares as of
the date of such meeting.
(d) The options granted will be nonstatutory stock options
not intended to qualify under Section 422 of the Internal Revenue Code
of 1986, as amended (the "Internal Revenue Code"), and shall have the
following terms and conditions:
(i) Price. The purchase price per Share deliverable upon the
exercise of each option shall be 100% of the Fair Market Value
per Share on the date the option is granted. For purposes of this
Plan, Fair Market Value shall be the closing sales price as
reported on the NASDAQ National Market on the date in question,
or, if the Shares shall not have traded on such date, the closing
sales price on the first date prior thereto on which the Shares
were so traded.
(ii) Payment. Payment of the purchase price shall be made in
full at the time the notice of exercise of the option is
delivered to the Company and shall be in cash, bank certified or
cashier's check for the Shares being purchased.
(iii) Exercisability and Terms of Options. Subject to any
vesting requirements, options shall be exercisable in whole or in
part at all times during the period beginning on the date of
grant until the earlier of ten years from the date of grant and
the expiration of the one year period provided in paragraph (iv)
below.
(iv) Termination of Service as Eligible Director. Upon
termination of a Participant's service as a Director for any
reason, all outstanding options which have become vested as of
the date of termination shall be exercisable in whole or in part
for a period of one year from the date upon which the Participant
ceases to be a Director, provided that in no event shall the
options be exercisable beyond the period provided for in
paragraph (iii) above.
(v) Nontransferability of Options. No option may be
assigned, alienated, pledged, attached, sold or otherwise
transferred or encumbered by a Participant otherwise than by will
or the laws of descent and distribution, and during the lifetime
of the Participant to whom an option is granted it may be
exercised only by the Participant or by the Participant's
guardian or legal representative. Notwithstanding the foregoing,
options may be transferred pursuant to a qualified domestic
relations order.
(vi) Listing and Registration. Each option shall be subject
to the requirement that if at any time the Board shall determine,
in its discretion, that the listing, registration or
qualification of the Shares subject to such option upon any
securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with,
the granting of such option or the issue or purchase of Shares
thereunder, no such option may be exercised in whole or in part
unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any
condition not acceptable to the Board.
(vii) Option Agreement. Each option granted hereunder shall
be evidenced by an agreement with the Company which shall contain
the terms and provisions set forth herein and shall otherwise be
consistent with the provisions of the Plan.
6. Adjustment of and Changes in Shares
In the event of a stock split, stock dividend, subdivision
or combination of the Shares or other change in corporate structure
affecting the Shares, the number of Shares authorized by the Plan
shall be increased or decreased proportionately, as the case may be,
and the number of Shares subject to any outstanding option shall be
increased or decreased proportionately, as the case may be, with
appropriate corresponding adjustment in the purchase price per Share
thereunder.
7. No Rights of Stockholders
Neither a Participant nor a Participant's legal
representative shall be, or have any of the rights and privileges of,
a shareholder of the Company in respect of any Shares purchasable upon
the exercise of any option, in whole or in part, unless and until
certificates for such Shares shall have been issued.
8. Plan Amendments
The Plan may be amended by the Board, as it shall deem
advisable or to conform to any change in any law or regulation
applicable thereto; provided, that the Board may not, without the
authorization and approval of stockholders of the Company: (i)
increase the number of Shares which may be purchased pursuant to
options hereunder, either individually or in the aggregate, except as
permitted by Section 6, (ii) change the requirement of Section 5(d)
that option grants be priced at Fair Market Value, except as permitted
by Section 6, (iii) modify in any respect the class of individuals who
constitute Eligible Directors or (iv) materially increase the benefits
accruing to Participants hereunder. The provisions of Sections 3
and/or 5 may not be amended more often than once every six months,
other than to comport with changes in the Internal Revenue Code, the
Employee Retirement Income Security Act, or the rules under either
such statute.
9. Effective Date and Duration of Plan
The Plan shall become effective upon adoption by the Board
so long as it is approved by the holders of a majority of the
Company's outstanding shares of voting capital stock at any time
within 12 months before or after the adoption of the Plan by the
Board. Unless sooner terminated by the Board, the Plan shall terminate
ten years from the earlier of (a) the date on which the Plan is
adopted by the Board or (b) the date on which the Plan is approved by
the stockholders of the Company. No option may be granted after such
termination or during any suspension of the Plan. The amendment or
termination of the Plan shall not, without the consent of the option
holder, alter or impair any rights or obligations under any option
theretofore granted under the Plan.
