SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The table below sets forth certain information regarding the beneficial
ownership of the common stock and Series A preferred stock as of the record
date by (1) each person (including any group) who is known by the Company to
own beneficially more than 5% of the outstanding shares of common stock; (2)
each director and/or nominee for director; (3) each of the Named Executive
Officers; and (4) all executive officers and directors as a group. Beneficial
ownership includes any shares which a person has the right to acquire within 60
days after the record date. Except as otherwise noted, each person has sole
voting power and investment power with respect to all shares of capital stock
listed as owned by such person.
Series A
Common Stock: Preferred:
Amount Amount
Beneficially Beneficially
Owned and Owned and
Nature of Percent Nature of
Beneficial of Beneficial Percent of
Name and Address of Beneficial Owner(1) Ownership Class(2) Ownership Class
--------------------------------------- ------------- -------- ------------ ----------
Big Beaver Investments LLC(3)...................... 5,826,890 39.6% 4,500 (20) 50.0%(21)
Westar Capital II LLC(4)........................... 2,919,902 21.6% 4,500 (20) 50.0%(21)
Special Situations Fund III, L.P.(5)(22)........... 2,800,050 23.9% 0 *
Special Situations Private Equity Fund, L.P.(6)(22) 1,399,950 12.4% 0 *
Special Situations Cayman Fund, L.P.(7)(22)........ 850,050 7.6% 0 *
Special Situations Technology Fund, L.P.(8)(22).... 450,000 4.1% 0 *
Special Situations Funds as a group(22)......... 5,500,050 48.0% 0 *
MicroCapital Fund LP(9)(23)........................ 590,502 5.4% 0 *
MicroCapital Fund Ltd.(10)(23)..................... 469,700 4.3% 0 *
Nattak Corporation(11)(23)......................... 53,400 * 0 *
MicroCapital Funds as a group(23)............... 1,113,602 10.0% 0 *
Lon E. Bell, Ph.D(12).............................. 246,986 2.3% 0 *
Oscar B. Marx, III(13)............................. 144,000 1.3% 0 *
Daniel R. Coker(14)................................ 115,914 1.1% 0 *
James L. Mertes(15)................................ 74,485 * 0 *
James J. Paulsen(13)............................... 27,500 * 0 *
Richard A. Weisbart(16)............................ 26,518 * 0 *
Francois Castaing(13).............................. 15,000 * 0 *
John W. Clark(17).................................. 14,400 * 0 *
Jurgen Brachetti(18)............................... 12,500 * 0 *
Paul Oster......................................... 2,000 * 0 *
All executive officers and directors as a group (10
persons)(19)..................................... 659,058 5.9% 0 *
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* Holdings represent less than 1% of all shares outstanding.
(1) Unless otherwise indicated, the address for all shareholders listed is c/o Amerigon Incorporated, 5462
Irwindale Avenue, Irwindale, California 91706.
(2) Includes as outstanding shares for purpose of this calculation the number of shares of common stock
outstanding as of the record date plus, in the case of a particular holder, shares of common stock subject to
options, warrants or other instruments exercisable for or convertible into shares of common stock within
60 days after the record date held by such holder, as specified in the note accompanying such holder.
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(3) Includes 2,686,567 shares of common stock issuable upon conversion of 4,500 shares of Series A
preferred stock and 1,269,721 shares of common stock issuable upon exercise of warrants held by Big
Beaver Investments LLC.
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14
(4) Includes 2,686,567 shares of common stock issuable upon conversion of 4,500 shares of Series A preferred
stock and 83,334 shares of common stock issuable upon exercise of a warrants held by Westar Capital II LLC.
(5) Includes 933,350 shares of common stock issuable upon exercise of a warrant held by Special Situations
Fund III, L.P. The address for Special Situations Fund III, L.P. is 153 E. 53rd Street, New York, New
York 10022.
(6) Includes 466,650 shares of common stock issuable upon exercise of a warrant held by Special Situations
Private Equity Fund, L.P. The address for Special Situations Private Equity Fund, L.P. is 153 E. 53rd
Street, New York, New York 10022.
(7) Includes 283,350 shares of common stock issuable upon exercise of a warrant held by Special Situations
Cayman Fund, L.P. The address for Special Situations Cayman Fund, L.P. is c/o /o CIBC Bank and Trust
Company (Cayman) Limited, CIBC Bank Building, P.O. Box 694, Grand Cayman, Cayman Islands,
British West Indies.
(8) Includes 150,000 shares of common stock issuable upon exercise of a warrant held by Special Situations
Technology Fund, L.P. The address for Special Situations Technology Fund, L.P. is 153 E. 53rd Street,
New York, New York 10022.
(9) Includes 183,334 shares of common stock issuable upon exercise of a warrant held by MicroCapital
Fund LP. The address of MicroCapital Fund LP is 410 Jessie Street, Suite 1002, San Francisco,
California 94103
(10) Includes 150,000 shares of common stock issuable upon exercise of a warrant held by MicroCapital
Fund Ltd. The address of MicroCapital Fund Ltd. is 410 Jessie Street, Suite 1002, San Francisco,
California 94103.
(11) The address for Nattak Corporation is West Wind Building, Harbour Drive, George Town, Grand
Cayman, Cayman Islands, British West Indies.
(12) Includes 79,250 shares of common stock issuable upon exercise of options.
(13) Includes options to purchase 54,000 shares of common stock granted in 2001 and options to purchase
90,000 shares of common stock to be granted through May 2002. All shares of common stock issuable
upon exercise of options.
(14) Includes 100,823 shares of common stock issuable upon exercise of options.
(15) Includes 61,121 shares of common stock issuable upon exercise of options.
(16) Mr. Weisbart resigned as President, Chief Executive Officer and a director of the Company on
October 25, 2001.
(17) Includes 2,000 shares of common stock issuable upon exercise of options.
(18) Includes 12,500 shares of common stock issuable upon exercise of options.
(19) Includes 455,194 shares of common stock issuable upon exercise of options granted to executive officers
and directors.
(20) On the record date, the 4,500 shares of Series A Preferred Stock held by each of Big Beaver Investments
LLC and Westar Capital II, LLC was convertible into 2,686,567 shares of common stock for a total of
5,373,134 shares of common stock.
(21) On the record date, the 5,373,134 shares of common stock issuable upon conversion of all 9,000
outstanding shares of Series A Preferred Stock represented approximately 26.1% of the Company's total
potential common equity, comprised of issued and outstanding common stock and common stock
issuable upon exercise of Series A Preferred Stock and outstanding warrants.
(22) MGP Advisors Limited ("MGP") is the general partner of Special Situations Fund III, L.P. AWM
Investment Company, Inc. ("AWM") is the general partner of MGP and the general partner of and
investment adviser to the Special Situations Cayman Fund, L.P. SST Advisers, L.L.C. ("SSTA") is the
general partner of and investment adviser to the Special Situations Technology Fund, L.P. MG Advisers,
L.L.C. ("MG") is the general partner of and investment adviser to the Special Situations Private Equity
Fund, L.P. Austin W. Marxe and David M. Greenhouse are the principal owners of MGP, SSTA, AWM
and MG and are principally responsible for the selection, acquisition and disposition of the portfolio
securities by each investment adviser on behalf of its fund.
(23) MicroCapital LLC is the general partner and investment advisor to MicroCapital Fund LP, MicroCapital
Fund Ltd. and Nattak Corporation. Ian P. Ellis is the principal owner of MicroCapital LLC and has sole
responsibility for the selection, acquisition and disposition of the portfolio securities by MicroCapital
LLC on behalf of its funds.
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15
APPROVAL OF AMENDMENT TO THE 1997 STOCK INCENTIVE PLAN
(Item 2 on the Proxy Card)
At the Annual Meeting, you will be asked to approve an amendment to the 1997
Plan (the "Amendment"). The Amendment consists primarily of three objectives:
(1) An increase in the aggregate number of shares available under the 1997
Plan; (2) The inclusion of non-employee directors into the eligible class of
persons for discretionary awards; and (3) The addition of initial option grants
under the Non-Employee Director Program. The following is a more detailed
summary of the three objectives:
. Share Increase. The 1997 Plan limits the aggregate number of shares of
common stock that may be issued or delivered. The aggregate share limit is
1,300,000 shares. As of March 31, 2002, approximately 714,289 of the
1,300,000 shares had been issued pursuant to awards or were subject to
awards then outstanding, and approximately 585,711 shares were then
available for additional 1997 Plan awards.
The Amendment, if approved by stockholders, will increase the aggregate
share limit from 1,300,000 to 1,800,000 (an increase of 500,000 shares),
subject to certain adjustments as provided in the 1997 Plan. See "Summary
Description of the 1997 Plan--Limits on Awards; Authorized Shares."
. Eligibility of Non-Employee Directors for Discretionary Awards. Directors
who are not officers nor employees of the Company or any of its
subsidiaries (each, a "Non-Employee Director") are currently only eligible
to receive annual formula option grants under the Non-Employee Director
Program. The Amendment, if approved by stockholders, will make
Non-Employee Directors eligible for discretionary awards of options, stock
bonuses and restricted stock under the 1997 Plan and eliminates the limit
on the aggregate number of shares of common stock that may be issued in
connection with such awards. The discretionary awards will be in addition
to, and not in lieu of, the automatic option grants under the Non-Employee
Director Program. We will have no obligation to grant discretionary awards
to Non-Employee Directors.
. Addition of Initial Options under Non-Employee Director Program. The
Non-Employee Director Program currently provides for an annual option
grant to Non-Employee Directors in office on the first business day of
each calendar year during the term of the 1997 Plan. The Amendment, if
approved by stockholders, will provide for, in addition to the annual
option grant, an initial option grant to purchase 5,000 shares to each
person who becomes a Non-Employee Director after the date of the Annual
Meeting.
The Board of Directors approved the Amendment, subject to stockholder
approval, based in part on the belief that the share increase, expanding
eligibility for discretionary awards to Non-Employee Directors and providing
for initial option grants under the Non-Employee Director Program will provide
additional flexibility to structure incentive compensation programs to attract,
motivate, reward and retain eligible employees and Non-Employee Directors. The
Board of Directors also believes that the Amendment to the 1997 Plan will
further align the interests of eligible employees with those of the
stockholders. In addition, the Board of Directors has approved, within its own
authority under the 1997 Plan, various editorial changes to clarify existing
language.
The principal terms of the 1997 Plan, as modified by the Amendment, are
summarized below. The following summary is qualified in its entirety by
reference to the full text of the 1997 Plan, which is attached to this Proxy
Statement as Appendix A, as modified by the Amendment. Capitalized terms not
otherwise defined herein have the meanings given to them in the 1997 Plan.
Summary Description of the 1997 Plan
The purpose of the 1997 Plan is to promote the success of the Company by
providing an additional means through the grant of stock options, restricted
stock awards and stock bonuses (collectively, "Awards"), to attract, retain,
motivate and reward key employees, including officers and directors of the
Company and its related subsidiaries, and, if the amendment is approved by
stockholders, Non-Employee Directors (collectively, "Eligible Persons") by
providing incentives related to equity interests in and the financial
performance of the Company.
16
In addition, the 1997 Plan includes an award feature further to attract,
motivate and retain experienced and knowledgeable Non-Employee Directors
through the automatic grant of nonqualified stock options (also referred to as
the "Non-Employee Director Program").
Administration. The 1997 Plan provides that it may be administered by the
Board of Directors or a committee consisting of two or more directors (or such
greater number of directors as may be required under applicable law), each of
whom is "disinterested" as the term is defined for purposes of Rule 16b-3 of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and
"outside" as such term is defined for purposes of the Internal Revenue Code of
1986, as amended (the "Code"). The 1997 Plan is currently administered by the
Compensation Committee of the Board of Directors.
The Committee has broad authority under the 1997 Plan with respect to Awards
granted to Eligible Persons:
. To select the Participants and the types of Awards they may receive;
. To determine the number of shares that are subject to Awards and the
specific terms and conditions of Awards, including the price (if any) to
be paid for the shares and/or the Awards and any vesting criteria;
. To cancel, modify or waive the Company's rights to, or modify,
discontinue, suspend or terminate any or all outstanding Awards, subject
to any required consents;
. To accelerate or extend the exercisability or extend the term of any or
all outstanding Awards within the maximum ten year term;
. To permit a Participant to pay the exercise price of an Option or the
purchase price of any shares in one or a combination of the following
methods: (1) In cash or by electronic funds transfer; (2) By check payable
to the order of the Company; (3) By notice and third party payment in such
manner as may be authorized by the Committee; or (4) By the delivery of
shares of common stock already owned by the Participant;
. To approve the forms of Award Agreements and construe and interpret the
1997 Plan and make all other determinations necessary or advisable for the
administration of the 1997 Plan; and
. To delegate ministerial, non-discretionary functions to officers and
employees of the Company.
The grant of Options to Non-Employee Directors under the Non-Employee
Director Program is automatic and, to the maximum extent possible,
self-effectuating. Although the Committee's discretion does extends to those
Options, Board approval or ratification is required for any material amendments
to Options granted under the Non-Employee Director Program.
In no case will the exercise price of any Option granted under the 1997 Plan
be reduced (by amendment, substitution, cancellation and regrant or other
means), unless authorized by stockholders. Adjustments resulting from
anti-dilution provisions of the 1997 Plan or a recapitalization,
reorganization, or similar transaction affecting the underlying securities are
not considered repricing.
Eligibility. Any officer, key employee (whether or not a director) of the
Company or its subsidiaries, or, if stockholders approve the Amendment,
Non-Employee Director, as determined in the sole discretion of the Committee,
is eligible to be granted Awards under the 1997 Plan. In addition, under the
Non-Employee Director Program, each Non-Employee Director is automatically
granted Nonqualified Stock Options as described below (see "Options under the
Non-Employee Director Program").
All of the current officers and all of the current Non-Employee Directors of
the Company are among those eligible to receive Awards, subject to the
Committee's discretion to determine the particular individuals who, from time
to time, will be selected to receive Awards. Currently, there are four
Non-Employee Directors and five officers of the Company. The number of key
employees of the Company, if any, who will be eligible to receive Awards has
not been determined at this time.
17
Shares Available for Awards. The aggregate number of shares that may be
delivered pursuant to all Awards under the 1997 Plan is 1,800,000 shares of the
Company's common stock. Various additional share limits are imposed. A maximum
of:
. 1,240,000 shares may be subject to Incentive Stock Options granted under
the 1997 Plan; and
. 250,000 shares may be issued subject to Awards under the 1997 Plan to any
one Eligible Person in any calendar year.
Each share limit and the number and kind of shares available under the 1997
Plan and the exercise price of Options are subject to adjustment in the event
of (1) certain reorganizations, mergers, combinations, recapitalizations, stock
splits, stock dividends, or other similar events that change the number or kind
of shares outstanding, and (2) extraordinary dividends or distributions of
property to the stockholders. Shares subject to Awards that are not exercised
or that expire or are cancelled will again become available for regrant and
award purposes under the 1997 Plan to the extent permitted by law. If an Award
is settled only in cash, it need not be counted against any of the share limits
described above.
The 1997 Plan does not limit the authority of the Board of Directors or the
Committee to grant Awards or authorize any other compensation with or without
reference to the Company's common stock, under any other plan or authority.
Types of Awards. The 1997 Plan authorizes the grant of Options, Stock
Bonuses and Restricted Stock Awards. Except as may be provided in an applicable
Award Agreement, no Option granted under the 1997 Plan may be exercisable or
may vest until at least six months after the Award Date. Generally speaking,
each Award will expire on the date determined by the Committee, but an Option
or other rights to acquire common stock will expire not more than ten years
after the Award Date.
Transfer Restrictions. Subject to customary exceptions, rights and benefits
under Awards under the 1997 Plan are not transferable by the recipient other
than by will or the laws of descent and distribution, and are generally only
exercisable by the Participant (or, if the Participant has suffered a
disability, his or her legal representative). The Committee may, however,
permit certain transfers of an Award if the transferor presents satisfactory
evidence that the transfer is for estate and/or tax planning purposes to
certain related persons or entities and without consideration (other than
nominal consideration), or in certain other circumstances.
Stock Options. An option is the right to purchase shares of common stock at
a future date at a specified price (the "Option Price") during a specified term
not to exceed ten years.
Options Grants to Eligible Persons
The Option Price of any Options granted to Eligible Persons under the 1997
Plan is determined by the Committee at the time of the grant; provided, that
the Option Price for incentive stock options ("ISOs") granted to an employee
Participant under the 1997 Plan may not be less than 100% (110% in the case of
an ISO granted to a Participant who owns or is deemed to own more than 10% of
the total combined voting power of all classes of stock of the Company) of the
Fair Market Value of the common stock on the date of grant.
An Option granted to an eligible employee may either be an ISO, as defined
in the Code, or a Nonqualified Stock Option ("NQSO"). Non-Employee Directors
are only eligible to be granted NQSOs. An ISO may not be granted to a person
who owns more than 10% of the total combined voting power of all classes of
stock of the Company unless the Option Price is at least 110% of the fair
market value of shares of common stock subject to
18
the Option and such Option by its terms is not exercisable after expiration of
five years from the date that the Option is granted. To the extent that the
aggregate fair market value (defined for this purpose as the fair market value
of the stock subject to the Options as of the date the Options are granted) of
stock with respect to which ISOs first become exercisable in any calendar year
exceeds $100,000 (taking into account stock subject to ISOs granted under the
1997 Plan or any other plan), these Options will be treated as NQSOs. ISO tax
consequences differ, and ISOs are subject to more restricted terms by the Code
and the 1997 Plan.
The Committee may grant one or more Options to any Eligible Persons. If the
optionee ceases to be employed by or provide service to the Company, the
Committee may determine the effect of termination on the rights and benefits
under the Options and in doing so may make distinctions based upon the cause of
termination or otherwise.
Options under the Non-Employee Director Program
The 1997 Plan provides that, subject to stockholder approval of the
Amendment, each person who first becomes a Non-Employee Director after the
Annual Meeting will automatically be granted an option to purchase 5,000 shares
of common stock at the time of his or her election to the Board. In addition,
on the first business day of each calendar year during the term of the 1997
Plan, each Non-Employee Director then continuing in office will automatically
be granted a NQSO to purchase 5,000 shares of common stock. (The Options
granted under the Non-Employee Director Program are referred to as Non-Employee
Director Options.) Each Non-Employee Director Option will have a purchase price
per share equal to the Fair Market Value of the common stock on the date of
grant. The Non-Employee Director Options become exercisable on the first
anniversary of the date of grant and, unless earlier terminated, expire ten
years after the date of grant.
Full payment for shares purchased must be paid in full at the time of
exercise, payable in cash, by check or by delivering shares of common stock
already owned by the Non-Employee Director.
If a Non-Employee Director's service as a member of the Board of Directors
is terminated for any reason other than death, total disability or retirement,
any portion of a Non-Employee Director Option granted to such individual that
is not then exercisable will terminate. Any portion of the Non-Employee
Director Option that is then exercisable will remain exercisable for two years
after his or her service terminates or until the expiration of the Non-Employee
Director Option's stated term, whichever occurs first.
If a Non-Employee Director's service as a member of the Board is terminated
by reason of his or her death or total disability, then all Non-Employee
Director Options granted to the Non-Employee Director (whether or not vested at
such time) will become immediately exercisable and remain exercisable for a
period of two years after the effective date of the Non-Employee Director's
termination of service or until the original expiration of the Non-Employee
Director Option's stated term, whichever first occurs.
If a Non-Employee Director retires on or after age 65 and after ten years of
service as a director, all Non-Employee Director Options granted to the
Non-Employee Director will become immediately exercisable and may be exercised
for five years after the date of retirement or until the expiration of the
Non-Employee Director Options' stated term, whichever occurs first.
Restricted Stock Awards. A Restricted Stock Award is an award typically for
a fixed number of shares of common stock, which are subject to vesting or other
restrictions. The Committee must specify the price, if any, or services the
recipient must provide for the shares of Restricted Stock, the conditions on
vesting (which may include, among others, the passage of time or specified
performance objectives or both) and any other restrictions (for example,
restrictions on transfer) imposed on the shares. If the recipient ceases to be
employed by or provide service to the Company, the Committee will determine the
effect of termination on the Restricted Stock and in doing so may make
distinctions based upon the cause of termination or otherwise.
19
Stock Bonuses. A Stock Bonus represents a bonus in shares for services
rendered. The Committee may grant stock bonuses to any or all Eligible Persons
to reward special services, contributions or achievements or for past services
in the ordinary course, in such manner and on such terms and conditions
(including any restrictions on the shares) as the Committee may determine from
time to time. The number of shares so awarded will be determined by the
Committee and may be granted independently or in lieu of cash bonuses or other
awards.
Adjustments; Acceleration. The 1997 Plan provides for certain adjustments
to Awards granted under the 1997 Plan upon the occurrence of certain specified
events. The number and kind of shares available under the 1997 Plan, as well as
the number, kind and price of shares subject to outstanding Awards, are subject
to adjustment in the event of a reorganization, merger, sale of assets,
recapitalization, stock split, stock dividend, exchange offer or similar event.
Adjustments to Options granted to Non-Employee Directors under the Non-Employee
Director Program may only be made to the extent that such adjustments (1) are
consistent with applicable law, (2) are, in the case of a Change in Control
Event (See Section 6 of the 1997 Plan for the definition of a Change in Control
Event), effected pursuant to a plan of reorganization approved by stockholders,
and (3) are consistent with adjustments to Awards granted under the 1997 Plan
held by persons other than executive officers or directors of the Company.
The 1997 Plan also generally provides for full vesting and acceleration of
Awards (subject to certain limitations applicable to persons subject to Section
16 of the Exchange Act) upon a Change in Control Event affecting the Company.
The Committee may, however, prior to the Change in Control Event, determine
that there will be no such acceleration of benefits. In certain circumstances,
Awards that have been fully accelerated and that have not been exercised prior
to the occurrence of certain events will terminate unless provision has been
made for their survival, exchange, substitution, exchange or other settlement.
Termination of or Changes to the 1997 Plan. The Board of Directors may,
without stockholder approval, terminate, suspend, modify or amend the 1997 Plan
at any time. The Board of Directors may not, however, increase the maximum
number of shares which may be delivered pursuant to Awards granted under the
1997 Plan, materially increase the benefits accruing to Participants under the
1997 Plan or materially change the requirements as to eligibility to
participate in the 1997 Plan without obtaining stockholder approval. Unless
required by applicable law, or deemed necessary or advisable by the Board of
Directors, stockholder approval of amendments in addition to those in the
preceding sentence will not be required.
No new Award may be granted under the 1997 Plan after April 24, 2007, unless
the 1997 Plan is terminated prior to that time by the Board of Directors. The
applicable provisions of the 1997 Plan and the Committee's authority will
continue with respect to any Awards still outstanding.
Generally speaking, outstanding Options and other Awards may be amended by
the Committee (except as to repricing) but the consent of the holder is
required if the amendment materially adversely affects the holder.
Securities Underlying Awards. The closing price of a share of common stock
as of April 19, 2002 was $2.44 per share.
Federal Income Tax Consequences of Options Under the 1997 Plan
The federal income tax consequences of the 1997 Plan under current federal
law, which are subject to change, are summarized in the following discussion of
general tax principles applicable to the 1997 Plan. The summary is not intended
to be exhaustive and does not describe state and local tax consequences.
The Company is generally entitled to deduct and the optionee recognizes
taxable income in an amount equal to the difference between the Option Price
and the fair market value of the shares at the time a NQSO is exercised. With
respect to Incentive Stock Options, the Company is generally not entitled to a
deduction nor does the Participant recognize income, either at the time of
grant or exercise or (provided that the Participant holds the
20
shares at least two years after the date of grant and one year after exercise)
at any later time. Rather, the Participant receives capital treatment (gain or
loss) on the difference between his basis and the ultimate sales price.
The current federal income tax treatment of other Awards authorized under
the 1997 Plan are generally as follows: Restricted stock is taxed at the time
of vesting (although Participants may elect earlier taxation and convert future
gains to capital gains) and bonuses are generally subject to tax when paid. In
each of the foregoing cases, the Company will generally have a corresponding
deduction at the time that the Participant recognizes income.
If an Award is accelerated under the 1997 Plan in connection with a change
in control (as this term is used under the Code), the Company may not be
permitted to deduct the portion of the compensation attributable to the
acceleration ("parachute payment") in excess of average annual base salary if
the parachute payment exceeds certain threshold limits under the Code; related
excise taxes also may be triggered. Furthermore, if compensation attributable
to Awards is not performance-based within the meaning of 162(m) of the Code,
the Company may not be permitted to deduct aggregate compensation to certain
executive officers that is not performance-based, to the extent that it exceeds
$1,000,000 in any tax year.
Specific Benefits
The following chart presents the benefits or amount under stock options that
will be allocated to (i) each Named Executive Officer, (ii) all current
executive officers as a group, (iii) all current directors who are not
executive officers as a group and (iv) all employees, including all current
officers who are not executive officers, as a group, pursuant to the automatic
option grants under the Non-Employee Director Program of the 1997 Plan for the
remaining term of the 1997 Plan, subject to any future amendments to the 1997
Plan.
1997 Plan, as amended by the Amendment
Number of Shares
Underlying Stock
Name and Position Options
----------------- -----------------
Richard A. Weisbart, President and Chief Executive Officer(1) Not eligible
Oscar B. Marx, III, Chief Executive Officer.................. Not eligible
Lon E. Bell, Vice Chairman of the Board...................... Not eligible
Daniel R. Coker, Vice President of Sales and Marketing....... Not eligible
James L. Mertes, Vice President of Quality and Operations.... Not eligible
Jurgen Brachetti, Vice President of European Operations...... Not eligible
Executive Group.............................................. Not eligible
Non-Executive Director Group (4 persons)..................... 20,000 per year(2)(3)(4)
Non-Executive Officer Employee Group......................... Not eligible
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(1) Mr. Weisbart resigned in October 2001.
(2) Represents the aggregate number of shares subject to each annual grant of
stock options for calendar years 2002 through 2007, assuming, among other
future variables, that there continues to be 4 eligible directors seated.
(3) The actual number of shares subject to stock options for initial one-time
grants, if the Amendment is approved by stockholders, is not determinable
because the number of initial one-time stock option grants in calendar
years 2002 through 2007 depends on future variables such as the election of
new eligible directors during the remaining term of the 1997 Plan.
(4) Messrs. Clark and Oster have previously waived their right to these grants
but are under no obligation to do so in the future.
21
We have not approved any awards under the 1997 Plan that are conditioned
upon stockholder approval of this Amendment. If the additional number of shares
that will be available under the 1997 Plan if this proposal is approved by
stockholders had been available for award purposes in fiscal 2001, we expect
that our award grants would not have been substantially different than those
actually made under the 1997 Plan. For information regarding awards granted to
our executive officers in fiscal 2001, see the material under the heading
"Executive Compensation" above.
We are not currently considering any additional specific award grants under
the 1997 Plan. Other than the automatic option grants under the Non-Employee
Director Program described in the chart above, the number, amount and type of
awards to be received by or allocated to Eligible Persons in the future under
the 1997 Plan cannot be determined at this time because such Awards are subject
to the discretion of the Committee. No other Awards are contemplated by the
Company at this time.
Vote Required
The Board of Directors believes that the changes to the 1997 Plan by the
approval of the Amendment will promote the interests of the Company and its
stockholders and continue to enable the Company to attract, retain and reward
persons important to the Company's success.
All members of the Board of Directors are eligible to receive Awards under
the 1997 Plan and thus have a personal interest in the approval of the
Amendment.
Approval of the Amendment requires the affirmative vote of the holders of a
majority of the shares represented in person or by proxy and entitled to vote
at the Annual Meeting.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP served as our independent accountants for the
fiscal year ended December 31, 2001, and has been selected to continue to serve
in such capacity for the current year. A representative of
PricewaterhouseCoopers LLP will be present at the Annual Meeting and will have
the opportunity to make a statement if they so choose. They will also be
available to respond to appropriate questions at such time.
OTHER MATTERS
If any matters not referred to in this proxy statement should properly come
before the Annual Meeting, the holders of your proxy will vote your shares in
accordance with his or her judgment. We are not aware of any such matters which
may be presented for action at the Annual Meeting. Your proxy may also vote
your shares on matters regarding the conduct of the Annual Meeting.
Enclosed with this proxy statement is our Annual Report for the year ended
December 31, 2001. The Annual Report is enclosed for the convenience of
shareholders only and should not be viewed as part of the proxy solicitation
material. If any person who was a beneficial owner of common stock or Series A
preferred
23
stock on the record date for the Annual Meeting desires additional copies of
the Annual Report, the same will be furnished without charge upon receipt of a
written request. The request should identify the person making the request as a
shareholder as of the record date and should be directed to the Corporate
Secretary, Amerigon Incorporated, 5462 Irwindale Avenue, Irwindale, California
91706.
By Order of the Board of Directors
Oscar B. Marx, III
Chief Executive Officer and Chairman
of the Board
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APPENDIX A
AMERIGON INCORPORATED
1997 STOCK INCENTIVE PLAN
(As Amended and Restated April 30, 2002)
1. THE PLAN.
1.1 Purpose.
The purpose of this Plan is to promote the success of the Company by
providing an additional means through the grant of Awards (a) to attract,
motivate, retain and reward key employees, including officers, and directors,
of the Company with awards and incentives for high levels of individual
performance and improved financial performance of the Company under Article 2
and Article 4, and (b) to attract, motivate and retain experienced and
knowledgeable independent directors through the benefits provided under Article
3. "Corporation" means Amerigon Incorporated and "Company" means the
Corporation and its Subsidiaries, collectively. These terms and other
capitalized terms are defined in Article 6.
1.2 Administration and Authorization; Power and Procedure.
(a) Committee. This Plan shall be administered by and all Awards to
Eligible Persons shall be authorized by the Committee. Action of the
Committee with respect to the administration of this Plan shall be taken
pursuant to a majority vote or by written consent of its members.
(b) Plan Awards; Interpretation; Powers of Committee. Subject to the
express provisions of this Plan, the Committee shall have the authority:
(i) to determine eligibility and, from among those persons determined
to be eligible, the particular Eligible Persons who will receive any
Awards;
(ii) to grant Awards to Eligible Persons, determine the price at
which securities will be offered (if any) and the amount of securities
to be offered to any of such persons, and determine the other specific
terms and conditions of such Awards consistent with the express limits
of this Plan, and establish the installments (if any) in which such
Awards shall become exercisable or shall vest, or determine that no
delayed exercisability or vesting is required, and establish the events
of reversion or termination of such Awards;
(iii) to approve the forms of Award Agreements (which need not be
identical either as to type of award or among Participants);
(iv) to construe and interpret this Plan and any agreements defining
the rights and obligations of the Company and Participants who are
granted Awards under this Plan, further define the terms used in this
Plan, and prescribe, amend and rescind rules and regulations relating to
the administration of this Plan;
(v) to cancel, modify, or waive the Corporation's rights with respect
to, or modify, discontinue, suspend, or terminate any or all outstanding
Awards held by Eligible Persons, subject to any required consent under
Section 5.6;
(vi) to accelerate or extend the exercisability or extend the term of
any or all such outstanding Awards within the maximum ten-year term of
Awards under Section 1.6; and
(vii) to make all other determinations and take such other action as
contemplated by this Plan or as may be necessary or advisable for the
administration of this Plan and the effectuation of its purposes.
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Notwithstanding the foregoing, the provisions of Article 3 relating to
Non-Employee Director Options shall be automatic and, to the maximum extent
possible, self-effectuating. Although the discretion of the Committee extends
to those Options, Board approval or ratification shall be required for any
material amendments to such Options.
(c) Binding Determinations. Any action taken by, or inaction of, the
Corporation, any Subsidiary, the Board or the Committee relating or pursuant to
this Plan shall be within the absolute discretion of that entity or body and
shall be conclusive and binding upon all persons. No member of the Board or
Committee, or officer of the Corporation or any Subsidiary, shall be liable for
any such action or inaction of the entity or body, of another person or, except
in circumstances involving bad faith, of himself or herself. Subject only to
compliance with the express provisions hereof, the Board and Committee may act
in their absolute discretion in matters within their authority related to this
Plan.
(d) Reliance on Experts. In making any determination or in taking or not
taking any action under this Plan, the Committee or the Board, as the case may
be, may obtain and may rely upon the advice of experts, including professional
advisors to the Corporation. No director, officer or agent of the Company shall
be liable for any such action or determination taken or made or omitted in good
faith.
(e) Delegation. The Committee may delegate ministerial, non-discretionary
functions to individuals who are officers or employees of the Company.
1.3 Participation.
Awards may be granted by the Committee only to those persons that the
Committee determines to be Eligible Persons. An Eligible Person who has been
granted an Award may, if otherwise eligible, be granted additional Awards if
the Committee shall so determine. Non-Employee Directors may be granted
discretionary Awards in accordance with Article 2 and Article 4 in addition to
any Nonqualified Stock Options granted automatically without action of the
Committee under the provisions of Article 3.
1.4 Shares Available for Awards; Share Limits.
(a) Shares Available. Subject to the provisions of Section 5.2, the capital
stock that may be delivered under this Plan shall be shares of the
Corporation's authorized but unissued Common Stock. The shares may be delivered
for any lawful consideration.
(b) Share Limits. The maximum number of shares of Common Stock that may be
delivered pursuant to all Awards (including both Nonqualified Stock Options and
Incentive Stock Options) granted under this Plan shall not exceed 1,800,000
shares (the "Share Limit"). The maximum number of shares of Common Stock that
may be delivered pursuant to options qualified as Incentive Stock Options
granted under this Plan is 1,240,000 shares. The maximum number of shares
subject to those options that are granted pursuant to Article 2 during any
calendar year to any Eligible Person shall be limited to 250,000. Each of the
four foregoing numerical limits shall be subject to adjustment as contemplated
by this Section 1.4 and Section 5.2.
(c) Share Reservation; Replenishment and Reissue of Unvested Options. No
Award may be granted under this Plan unless, on the date of grant, the sum of
(i) the maximum number of shares issuable at any time pursuant to such Award,
plus (ii) the number of shares that have previously been issued pursuant to
Awards granted under this Plan, other than reacquired shares available for
reissue consistent with any applicable limitations, plus (iii) the maximum
number of shares that may be issued at any time after such date of grant
pursuant to Awards that are outstanding on such date, does not exceed the Share
Limit. Shares that are subject to or underlie Awards which expire or for any
reason are cancelled or terminated, are forfeited, fail to vest, or for any
other reason are not paid or delivered under this Plan, as well as reacquired
shares, shall again, except to the extent prohibited by law, be available for
subsequent Awards under this Plan. Except as limited by law, if an Award is
settled only in cash, such Award need not be counted against any of the limits
under this Section 1.4.
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1.5 Grant of Awards.
Subject to the express provisions of this Plan, the Committee shall
determine the number of shares of Common Stock subject to each Award and the
price (if any) to be paid for the shares. Each Award shall be evidenced by an
Award Agreement signed by the Corporation and, if required by the Committee, by
the Participant.
1.6 Award Period.
Each Award and all executory rights or obligations under the related Award
Agreement shall expire on such date (if any) as shall be determined by the
Committee, but in the case of Options or other rights to acquire shares of
Common Stock not later than ten (10) years after the Award Date.
1.7 Limitations on Exercise and Vesting of Awards.
(a) Provisions for Exercise. Unless the Committee otherwise expressly
provides, no Award shall be exercisable or shall vest until at least six months
after the initial Award Date, and once exercisable an Award shall remain
exercisable until the expiration or earlier termination of the Award.
(b) Procedure. Any exercisable Award shall be deemed to be exercised when
the Secretary of the Corporation receives written notice of such exercise from
the Participant, together with any required payment made in accordance with
Section 2.2(a) or 3.3, as the case may be.
(c) Fractional Shares/Minimum Issue. Fractional share interests shall be
disregarded, but may be accumulated. The Committee, however, may determine in
the case of Eligible Persons that cash, other securities, or other property
will be paid or transferred in lieu of any fractional share interests. No fewer
than 100 shares may be purchased on exercise of any Award at one time unless
the number purchased is the total number at the time available for purchase
under the Award.
1.8 No Transferability.
(a) Limit on Exercise and Transfer. Unless otherwise expressly provided in
(or pursuant to) this Section 1.8, by applicable law and by the Award
Agreement, as the same may be amended, (i) all Awards are non-transferable and
shall not be subject in any manner to sale, transfer, anticipation, alienation,
assignment, pledge, encumbrance or charge; (ii) Awards shall be exercised only
by the Participant; and (iii) amounts payable or shares issuable pursuant to an
Award shall be delivered only to (or for the account of) the Participant.
(b) Exceptions. The Committee may permit Awards to be exercised by and paid
to certain persons or entities related to the Participant pursuant to such
conditions and procedures as the Committee may establish. Any permitted
transfer shall be subject to the condition that the Committee receive evidence
satisfactory to it that the transfer is being made for estate and/or tax
planning purposes or a gratuitous or donative basis and without consideration
(other than nominal consideration). Notwithstanding the foregoing, Incentive
Stock Options and Restricted Stock Awards shall be subject to any and all
applicable transfer restrictions under the Code.
(c) Further Exceptions to Limits On Transfer. The exercise and transfer
restrictions in Section 1.8(a) shall not apply to:
(i) transfers to the Corporation,
(ii) the designation of a beneficiary to receive benefits in the event of
the Participant's death or, if the Participant has died, transfers to or
exercise by the Participant's beneficiary, or, in the absence of a validly
designated beneficiary, transfers by will or the laws of descent and
distribution,
(iii) transfers pursuant to a QDRO order,
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(iv) if the Participant has suffered a disability, permitted transfers or
exercises on behalf of the Participant by his or her legal representative, or
(v) the authorization by the Committee of "cashless exercise" procedures
with third parties who provide financing for the purpose of (or who
otherwise facilitate) the exercise of Awards consistent with applicable laws
and the express authorization of the Committee.
Notwithstanding the foregoing, Incentive Stock Options and Restricted Stock
Awards shall be subject to all applicable transfer restrictions under the Code.
2. OPTIONS.
2.1 Grants.
One or more Options may be granted under this Article 2 to any Eligible
Person. Each Option granted may be either an Option intended to be an Incentive
Stock Option, or not so intended, as determined by the Committee, and such
intent shall be indicated in the applicable Award Agreement. Notwithstanding
the preceding sentence, Options granted to Non-Employee Directors shall only be
Nonqualified Stock Options.
2.2 Option Price.
(a) Pricing Limits. The purchase price per share of the Common Stock
covered by each Option shall be determined by the Committee at the time of the
grant, but in the case of Incentive Stock Options shall not be less than 100%
(110% in the case of a Participant who owns or is deemed to own under Section
424(d) of the Code more than 10% of the total combined voting power of all
classes of stock of the Corporation) of the Fair Market Value of the Common
Stock on the date of grant.
(b) Payment Provisions. The purchase price of any shares purchased on
exercise of an Option granted under this Article 2 shall be paid in full at the
time of each purchase in one or a combination of the following methods: (i) in
cash or by electronic funds transfer; (ii) by check payable to the order of the
Corporation; (iii) by notice and third party payment in such manner as may be
authorized by the Committee; or (iv) by the delivery of shares of Common Stock
of the Corporation already owned by the Participant, provided, however, that
the Committee may in its absolute discretion limit the Participant's ability to
exercise an Option by delivering such shares; and provided further that any
shares delivered that were initially acquired from the Corporation upon
exercise of a stock option or otherwise must have been owned by the Participant
at least six months as of the date of delivery. Shares of Common Stock used to
satisfy the exercise price of an Option shall be valued at their Fair Market
Value on the date of exercise.
2.3 Limitations on Grant and Terms of Incentive Stock Options.
(a) $100,000 Limit. To the extent that the aggregate "fair market value"
of stock with respect to which incentive stock options first become
exercisable by a Participant in any calendar year exceeds $100,000, taking
into account both Common Stock subject to Incentive Stock Options under this
Plan and stock subject to incentive stock options under all other plans of
the Company or any parent corporation, such options shall be treated as
nonqualified stock options. For this purpose, the "fair market value" of the
stock subject to options shall be determined as of the date the options were
awarded. In reducing the number of options treated as incentive stock
options to meet the $100,000 limit, the most recently granted options shall
be reduced first. To the extent a reduction of simultaneously granted
options is necessary to meet the $100,000 limit, the Committee may, in the
manner and to the extent permitted by law, designate which shares of Common
Stock are to be treated as shares acquired pursuant to the exercise of an
Incentive Stock Option.
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(b) Option Period. Each Option and all rights thereunder shall expire no
later than ten years after the Award Date.
(c) Other Code Limits. Incentive Stock Options may only be granted to
Eligible Employees of the Corporation or a Subsidiary that satisfies the other
eligibility requirements of the Code. There shall be imposed in any Award
Agreement relating to Incentive Stock Options such terms and conditions as from
time to time are required in order that the Option be an "incentive stock
option" as that term is defined in Section 422 of the Code.
2.4 Limits on 10% Holders.
No Incentive Stock Option may be granted to any person who, at the time the
Option is granted, owns (or is deemed to own under Section 424(d) of the Code)
shares of outstanding Common Stock possessing more than 10% of the total
combined voting power of all classes of stock of the Corporation, unless the
exercise price of such Option is at least 110% of the Fair Market Value of the
stock subject to the Option and such Option by its terms is not exercisable
after the expiration of five years from the date such Option is granted.
2.5 Cancellation and Regrant/Waiver of Restrictions.
Subject to Section 1.4 and Section 5.6 and the specific limitations on
Options contained in this Plan, the Committee from time to time may authorize,
generally or in specific cases only, any adjustment in the exercise or purchase
price, the number of shares subject to, the restrictions upon or the term of,
an Option granted under this Article 2 by cancellation of an outstanding Option
and a subsequent regranting of an Option, by amendment, by substitution of an
outstanding Option, by waiver or by other legally valid means. Such amendment
or other action may provide for a greater or lesser number of shares subject to
the Option, or provide for a longer or shorter vesting or exercise period.
3. NON-EMPLOYEE DIRECTOR OPTIONS.
3.1 Participation.
Options under this Article 3 shall be made only to Non-Employee Directors
and shall be evidenced by Award Agreements substantially in the form of Exhibit
A hereto.
3.2 Annual Option Grants.
(a) Time of Initial Award. Subject to the approval by the shareholders of
the Corporation, persons who are elected or appointed to the Board after May
22, 2002 shall be granted automatically (without any action by the Committee or
the Board) a Nonqualified Stock Option to purchase 5,000 shares of Common Stock.
(b) Subsequent Annual Awards. On the first business day of each calendar
year during the term of this Plan, commencing with the first business day
occurring in 1998, there shall be granted automatically (without any action by
the Committee or the Board) a Nonqualified Stock Option (the Award Date of
which shall be such date) to each Non-Employee Director then in office to
purchase 5,000 shares of Common Stock.
(c) Maximum Number of Shares. Annual grants that would otherwise exceed the
maximum number of shares under Section 1.4(b) shall be prorated within such
limitation. A Non-Employee Director shall not receive more than one
Nonqualified Stock Option under this Section 3.2 in any calendar year.
3.3 Option Price.
The purchase price per share of the Common Stock covered by each Option
granted pursuant to Section 3.2 hereof shall be 100 percent of the Fair Market
Value of the Common Stock on the Award Date. The exercise
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price of any Option granted under this Article 3 shall be paid in full at the
time of each purchase in cash or by check or in shares of Common Stock valued
at their Fair Market Value on the date of exercise of the Option, or partly in
such shares and partly in cash, provided that any such shares used in payment
shall have been owned by the Participant at least six months prior to the date
of exercise.
3.4 Option Period and Exercisability.
Each Option granted under this Article 3 and all rights or obligations
thereunder shall expire ten years after the Award Date and shall be subject to
earlier termination as provided below. Subject to section 3.5 below, each
Option granted under Section 3.2 shall become exercisable on the first
anniversary of the Award Date.
3.5 Termination of Directorship.
If a Non-Employee Director's services as a member of the Board of Directors
terminate for any reason other than total disability, death or retirement, any
portion of an Option granted pursuant to this Article 3 which is not then
exercisable shall terminate and any portion of such Option which is then
exercisable may be exercised for two years after the date of such termination
or until the expiration of the stated term, whichever first occurs. If a
Non-Employee Director's services as a member of the Board of Directors
terminate because of total disability or death, then all Options granted
pursuant to this Article shall become immediately exercisable and may be
exercised for two years after the effective date of the termination of service
or until the expiration of the stated term, whichever occurs first. If a
Non-Employee Director retires on or after age 65 and after ten years of service
as a Director, all Options granted pursuant to this Article shall become
immediately exercisable and may be exercised for five years after the date of
retirement or until the expiration of the stated term, whichever occurs first.
3.6 Adjustments.
Options granted under this Article 3 shall be subject to adjustment as
provided in Section 5.2, but only to the extent that (a) such adjustment and
the Committee's actions in respect thereof satisfy the requirements of all
applicable law, (b) such adjustment in the case of a Change in Control Event is
effected pursuant to the terms of a reorganization agreement approved by
shareholders of the Corporation, and (c) such adjustment is consistent with
adjustments to Options held by persons other than executive officers or
directors of the Corporation.
3.7 Acceleration Upon a Change in Control Event.
Upon the occurrence of a Change in Control Event, each Option granted under
Section 3.2 hereof shall become immediately exercisable in full. To the extent
that any Option granted under this Article 3 is not exercised prior to (i) a
dissolution of the Corporation or (ii) a merger or other corporate event that
the Corporation does not survive, and no provision is (or consistent with the
provisions of Section 3.7 can be) made for the assumption, conversion,
substitution or exchange of the Option, the Option shall terminate upon the
occurrence of such event.
4. GRANTS OF STOCK BONUSES AND OTHER AWARDS.
4.1 Grants of Stock Bonuses. Subject to Section 5.4, the Committee may
grant a Stock Bonus to any Eligible Person to reward exceptional or special
services, contributions or achievements, or issue Common Stock for past
services in the ordinary course, the value of which shall be determined by the
Committee, in the manner and on such terms and conditions (including
restrictions on such shares) as determined from time to time by the Committee.
The number of shares so awarded shall be determined by the Committee. The Award
may be granted independently or in lieu of a cash bonus.
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4.2 Restricted Stock Awards.
(a) The Committee may grant one or more Restricted Stock Awards to any
Eligible Person. Subject to the terms and conditions of this Plan, the
Committee shall determine and set forth in the applicable Award Agreement
the number of shares of Common Stock subject to each Restricted Stock Award,
the consideration (if any, but not less than the minimum lawful
consideration under applicable state law) to be paid for such shares, the
extent (if any) to which and the time (if ever) at which the Participant
will be entitled to dividends, voting and other rights with respect to the
shares prior to vesting, the vesting, purchase price per share and manner
and method of payment for such shares, the term of the Restricted Stock
Award and any other terms and conditions of and restrictions on the
Restricted Stock. The purchase price to be paid for such shares may be paid
in any one or a combination of the following methods: (i) in cash or by
electronic funds transfer; (ii) by check payable to the order of the
Corporation; or (iii) by notice and third party payment in such manner as
may be authorized by the Committee.
(b) Certificates or book entries evidencing restricted shares subject to
a Restricted Stock Award shall bear a legend or notation making appropriate
reference to the restrictions imposed on such shares and shall be held by
the Corporation or by a third party designated by the Committee until the
restrictions on such shares have lapsed and the shares have vested in
accordance with the provisions of this Plan and the applicable Award
Agreement.
(c) Except as provided in Section 1.8, restricted shares subject to any
Restricted Stock Award may not be sold, assigned, transferred, pledged or
otherwise disposed of or encumbered, either voluntarily or involuntarily,
until the restrictions on such shares have lapsed. Unless the Committee
otherwise expressly provides, restricted shares that remain subject to
vesting or other restrictions at the time the Participant's employment or
service terminates or are subject to vesting or other conditions that are
not satisfied by the time specified on the applicable Award Agreement shall
be returned to the Corporation or cancelled, as the case may be.
5. OTHER PROVISIONS.
5.1 Rights of Eligible Persons, Participants and Beneficiaries.
(a) Employment or Service Status. Status as an Eligible Person shall not
be construed as a commitment that any Award will be made under this Plan to
an Eligible Person or to Eligible Persons generally.
(b) No Employment/Service Contract. Nothing contained in this Plan (or
in any other documents related to this Plan or to any Award) shall confer
upon any Eligible Person or other Participant any right to continue in the
employ or other service of the Company or constitute any contract or
agreement of employment or other service, nor shall interfere in any way
with the right of the Company to change such person's compensation or other
benefits or to terminate his or her employment or other service, with or
without cause. Nothing contained in this Section 5.1(b), however, shall
adversely affect any express independent right of such person under a
separate employment or service contract other than an Award Agreement.
(c) Plan Not Funded. Awards payable under this Plan shall be payable in
shares or from the general assets of the Corporation, and (except as
provided in Section 1.4(c)) no special or separate reserve, fund or deposit
shall be made to assure payment of such Awards. No Participant, Beneficiary
or other person shall have any right, title or interest in any fund or in
any specific asset (including shares of Common Stock, except as expressly
otherwise provided) of the Company by reason of any Award hereunder. Neither
the provisions of this Plan (or of any related documents), nor the creation
or adoption of this Plan, nor any action taken pursuant to the provisions of
this Plan shall create, or be construed to create, a trust of any kind or a
fiduciary relationship between the Company and any Participant, Beneficiary
or other person. To the extent that a Participant, Beneficiary or other
person acquires a right to receive payment pursuant to any Award hereunder,
such right shall be no greater than the right of any unsecured general
creditor of the Company.
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5.2 Adjustments; Acceleration.
(a) Adjustments. If there shall occur any extraordinary dividend or
other extraordinary distribution in respect of the Common Stock (whether in
the form of cash, Common Stock, other securities, or other property), or any
recapitalization, stock split (including a stock split in the form of a
stock dividend), reverse stock split, reorganization, merger, combination,
consolidation, split-up, spin-off, repurchase, or exchange of Common Stock
or other securities of the Corporation, or there shall occur any other like
corporate transaction or event in respect of the Common Stock or a sale of
substantially all the assets of the Corporation as an entirety, then the
Committee shall, in such manner and to such extent (if any) as it deems
appropriate and equitable (i) proportionately adjust any or all of (a) the
number and type of shares of Common Stock (or other securities) which
thereafter may be made the subject of Awards (including the specific numbers
of shares set forth elsewhere in this Plan), (b) the number, amount and type
of shares of Common Stock (or other securities or property) subject to any
or all outstanding Awards, (c) the exercise or purchase price of any or all
outstanding Awards, or (d) the securities, cash or other property
deliverable upon exercise of any outstanding Awards, or (ii) in the case of
an extraordinary dividend or other distribution, merger, reorganization,
consolidation, combination, sale of assets, split up, exchange, or spin off,
make provision for a cash payment or for the substitution or exchange of any
or all outstanding Awards or the cash, securities or property deliverable to
the holder of any or all outstanding Awards based upon the distribution or
consideration payable to holders of the Common Stock of the Corporation upon
or in respect of such event; provided, however, in each case, that with
respect to Incentive Stock Options, no such adjustment shall be made which
would cause this Plan to violate Section 422 or 424(a) of the Code or any
successor provisions thereto without the written consent of holders
materially adversely affected thereby. In any of such events, the Committee
may take such action sufficiently prior to such event if necessary to permit
the Participant to realize the benefits intended to be conveyed with respect
to the underlying shares in the same manner as is available to shareholders
generally.
(b) Acceleration of Awards Upon Change in Control. As to any Participant
who has been granted an Award under this Plan (other than Options under
Article 3, which Options shall be subject to the provisions of Section 3.7),
unless prior to a Change in Control Event the Committee determines that,
upon its occurrence, there shall be no acceleration of benefits under Awards
or determines that only certain or limited benefits under Awards shall be
accelerated and the extent to which they shall be accelerated, and/or
establishes a different time in respect of such Change in Control Event for
such acceleration, then upon the occurrence of a Change in Control Event
each outstanding Option shall become immediately exercisable and each
outstanding Restricted Stock Award shall vest and the restrictions imposed
upon the shares subject thereto shall lapse. The Committee may override the
limitations on acceleration in this Section 5.2(b) by express provision in
the Award Agreement and may accord any Eligible Person a right to refuse any
acceleration, whether pursuant to the Award Agreement or otherwise, in such
circumstances as the Committee may approve. Any acceleration of Awards shall
comply with applicable regulatory requirements, including without limitation
Section 422 of the Code.
(c) Possible Early Termination of Accelerated Awards. If any Award under
this Plan (other than an Option granted under Article 3, which Options shall
be subject to the provisions of Section 3.7) has been fully accelerated as
permitted by Section 5.2(b) but is not exercised prior to (i) a dissolution
of the Corporation, or (ii) a reorganization event described in Section
5.2(a) that the Corporation does not survive, or (iii) the consummation of
reorganization event described in Section 5.2(a) that results in a Change in
Control Event approved by the Board, and no provision has been made for the
survival, substitution, exchange or other settlement of such Award, such
Award shall thereupon terminate.
5.3 Effect of Termination of Employment or Service.
The Committee shall establish in respect of each Award granted to an
Eligible Person the effect of a termination of employment or service on the
rights and benefits thereunder and in so doing may make distinctions based upon
the cause of termination or otherwise.
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5.4 Compliance with Laws.
This Plan, the granting and vesting of Awards under this Plan and the
issuance and delivery of shares of Common Stock and/or the payment of money
under this Plan or under Awards granted hereunder are subject to compliance
with all applicable federal and state laws, rules and regulations (including
but not limited to state and federal securities law and federal margin
requirements) and to such approvals by any listing, regulatory or governmental
authority as may, in the opinion of counsel for the Corporation, be necessary
or advisable in connection therewith. Any securities delivered under this Plan
shall be subject to such restrictions, and the person acquiring such securities
shall, if requested by the Corporation, provide such assurances and
representations to the Corporation as the Corporation may deem necessary or
desirable to assure compliance with all applicable legal requirements.
5.5 Tax Withholding.
(a) Cash or Shares. Upon any exercise or payment of any Award or upon
the disposition of shares of Common Stock acquired pursuant to the exercise
of an Incentive Stock Option prior to satisfaction of the holding period
requirements of Section 422 of the Code, the Company shall have the right at
its option to (i) require the Participant (or Personal Representative or
Beneficiary, as the case may be) to pay or provide for payment of at least
the minimum amount of any taxes which the Company may be required to
withhold with respect to such Award event or payment or (ii) deduct from any
amount payable in cash the minimum amount of any taxes which the Company may
be required to withhold with respect to such cash payment. In any case where
a tax is required to be withheld in connection with the delivery of shares
of Common Stock under this Plan, the Committee may in its sole discretion
(subject to Section 5.4) grant (either at the time of the Award or
thereafter) to the Participant the right to elect, pursuant to such rules
and subject to such conditions as the Committee may establish, to have the
Corporation reduce the number of shares to be delivered by (or otherwise
reacquire) the appropriate number of shares valued at their then Fair Market
Value, to satisfy such withholding obligation. In no event shall shares be
withheld in excess of the minimum number required for tax withholding under
applicable law.
(b) Tax Loans. The Company may, in its discretion, authorize a loan to
an Eligible Employee in the amount of any taxes which the Company may be
required to withhold with respect to shares of Common Stock received (or
disposed of, as the case may be) pursuant to a transaction described in
subsection (a) above. Such a loan shall be for a term, at a rate of interest
and pursuant to such other terms and conditions as the Company, under
applicable law may establish.
5.6 Plan Amendment, Termination and Suspension.
(a) Board Authorization. The Board may, at any time, terminate or, from
time to time, amend, modify or suspend this Plan, in whole or in part. No
Awards may be granted during any suspension of this Plan or after
termination of this Plan, but the Committee shall retain jurisdiction as to
Awards then outstanding in accordance with the terms of this Plan.
(b) Shareholder Approval. Any amendment that would (i) materially
increase the benefits accruing to Participants under this Plan, (ii)
materially increase the aggregate number of securities that may be issued
under this Plan, or (iii) materially modify the requirements as to
eligibility for participation in this Plan, shall be subject to shareholder
approval only to the extent then required by Section 422 of the Code or
applicable law, or deemed necessary or advisable by the Board.
(c) Amendments to Awards. Without limiting any other express authority
of the Committee under but subject to the express limits of this Plan, the
Committee by agreement or resolution may waive conditions of or limitations
on Awards to Eligible Persons that the Committee in the prior exercise of
its discretion has imposed, without the consent of a Participant, and may
make other changes to the terms and conditions of Awards that do not affect
in any manner materially adverse to the Participant, his or her rights and
benefits under an Award. Notwithstanding anything else contained herein to
the contrary, the
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Committee shall not, without prior shareholder approval (i) authorize the
amendment of outstanding Options to reduce the exercise price, as
applicable, except as contemplated by Section 5.2, or (ii) cancel and
replace outstanding Options with similar Options having an exercise or base
price which is lower, except as contemplated by Section 5.2.
(d) Limitations on Amendments to Plan and Awards. No amendment,
suspension or termination of this Plan or change of or affecting any
outstanding Award shall, without written consent of the Participant, affect
in any manner materially adverse to the Participant any rights or benefits
of the Participant or obligations of the Corporation under any Award granted
under this Plan prior to the effective date of such change. Changes
contemplated by Section 5.2 shall not be deemed to constitute changes or
amendments for purposes of this Section 5.6.
5.7 Privileges of Stock Ownership.
Except as otherwise expressly authorized by the Committee or this Plan, a
Participant shall not be entitled to any privilege of stock ownership as to any
shares of Common Stock not actually delivered to and held of record by him or
her. No adjustment will be made for dividends or other rights as a shareholder
for which a record date is prior to such date of delivery.
5.8 Effective Date of the Plan.
This Plan shall be effective as of April 24, 1997, the date of Board
approval. This amendment to and restatement of the Plan is effective April 30,
2002, subject to shareholder approval.
5.9 Term of the Plan.
No Award shall be granted more than ten years after the effective date of
this Plan (the "Termination Date"). Unless otherwise expressly provided in this
Plan or in an applicable Award Agreement, any Award theretofore granted may
extend beyond such date, and all authority of the Committee with respect to
Awards hereunder shall continue during any suspension of this Plan and in
respect of outstanding Awards on such Termination Date.
5.10 Governing Law/Construction/Severability.
(a) Choice of Law. This Plan, the Awards, all documents evidencing
Awards and all other related documents shall be governed by, and construed
in accordance with the laws of the State of California.
(b) Severability. If any provision shall be held by a court of competent
jurisdiction to be invalid and unenforceable, the remaining provisions of
this Plan shall continue in effect.
(c) Plan Construction.
(1) Rule 16b-3. It is the intent of the Corporation that the Awards
and transactions permitted by Awards be interpreted in a manner that, in
the case of Participants who are or may be subject to Section 16 of the
Exchange Act, satisfy any then applicable requirements of Rule 16b-3 so
that such persons (unless they otherwise agree) will be entitled to the
benefits of Rule 16b-3 or other exemptive rules under Section 16 of the
Exchange Act in respect of these transactions and will not be subjected
to avoidable liability thereunder. If any provision of this Plan or of
any Award would otherwise frustrate or conflict with the intent
expressed above, that provision to the extent possible shall be
interpreted so as to avoid such conflict. If the conflict remains
irreconcilable, the Committee may disregard the provision if it
concludes that to do so furthers the interest of the Corporation and is
consistent with the purposes of this Plan as to such persons in the
circumstances.
(2) Section 162(m). It is the further intent of the Company that
Options with an exercise price not less than Fair Market Value on the
date of grant shall qualify as performance-based compensation under
Section 162(m) of the Code, and this Plan shall be interpreted
consistent with such intent.
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5.11 Captions.
Captions and headings are given to the sections and subsections of this Plan
solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
this Plan or any provision thereof.
5.12 Effect of Change of Subsidiary Status.
For purposes of this Plan and any Award hereunder, if an entity ceases to be
a Subsidiary a termination of employment shall be deemed to have occurred with
respect to each employee of such Subsidiary who does not continue as an
employee of another entity within the Company.
5.13 Non-Exclusivity of Plan.
Nothing in this Plan shall limit or be deemed to limit the authority of the
Board or the Committee to grant awards or authorize any other compensation,
with or without reference to the Common Stock, under any other plan or
authority.
6. DEFINITIONS.
6.1 Definitions.
(a) "Award" shall mean an award of any Option, Restricted Stock Award,
Stock Bonus, or any combination thereof, whether alternative or cumulative
authorized by and granted under this Plan.
(b) "Award Agreement" shall mean any writing setting forth the terms of
an Award that has been authorized by the Committee.
(c) "Award Date" shall mean the date upon which the Committee took the
action granting an Award or such later date as the Committee designates as
the Award Date at the time of the Award or, in the case of Options under
Article 3, the applicable dates set forth therein.
(d) "Award Period" shall mean the period beginning on an Award Date and
ending on the expiration date of such Award.
(e) "Beneficiary" shall mean the person, persons, trust or trusts
designated by a Participant or, in the absence of a designation, entitled by
will or the laws of descent and distribution, to receive the benefits
specified in the Award Agreement and under this Plan in the event of a
Participant's death, and shall mean the Participant's executor or
administrator if no other Beneficiary is designated and able to act under
the circumstances.
(f) "Board" shall mean the Board of Directors of the Corporation.
(g) "Change in Control Event" shall mean any of the following:
(i) Approval by the shareholders of the Corporation of the
dissolution or liquidation of the Corporation;
(ii) Approval by the shareholders of the Corporation of an agreement
to merge or consolidate, or otherwise reorganize, with or into one or
more entities that are not wholly owned by the Corporation, as a result
of which less than 50% of the outstanding voting securities of the
surviving or resulting entity immediately after the reorganization are,
or will be, owned by shareholders of the Corporation immediately before
such reorganization (assuming for purposes of such determination that
there is no change in the record ownership of the Corporation's
securities from the record date for such approval until such
reorganization and that such record owners hold no securities of the
other parties to such reorganization);
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(iii) Approval by the shareholders of the Corporation of the sale of
substantially all of the Corporation's business and/or assets to a
person or entity which is not wholly owned by the Corporation;
(iv) Any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act but excluding any person described in and satisfying
the conditions of Rule 13d-1(b)(1) thereunder), becomes the beneficial
owner (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing more than 20%
of the combined voting power of the Corporation's then outstanding
securities entitled to then vote generally in the election of directors
of the Corporation; or
(v) A majority of the Board not being composed of Continuing
Directors.
(h) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
(i) "Commission" shall mean the Securities and Exchange Commission.
(j) "Committee" shall mean the Board or a committee appointed by the
Board to administer this Plan, which committee shall be comprised only of
two or more directors or such greater number of directors as may be required
under applicable law, each of whom, (i) in respect of any decision at a time
when the Participant affected by the decision may be subject to Section
162(m) of the Code, shall be an "outside" director within the meaning of
Section 162(m) of the Code, and (ii) in respect of any decision affecting a
transaction at a time when the Participant involved in the transaction may
be subject to Section 16 of the Exchange Act, shall be a "non-employee
director" within the meaning of Rule 16b-3(b)(3) promulgated under the
Exchange Act.
(k) "Common Stock" shall mean the Common Stock of the Corporation and
such other securities or property as may become the subject of Awards, or
become subject to Awards, pursuant to an adjustment made under Section 5.2
of this Plan.
(l) "Company" shall mean, collectively, the Corporation and its
Subsidiaries.
(m) "Continuing Directors" shall mean persons who were members of the
Board on June 17, 1997 or nominated for election or elected to the Board
with the affirmative vote of at least three-fourths of the directors who
were Continuing Directors at the time of such nomination or election.
(n) "Corporation" shall mean Amerigon Incorporated, a California
corporation and its successors.
(o) "Eligible Employee" shall mean an officer (whether or not a director)
or other key employee of the Company.
(p) "Eligible Person" means an Eligible Employee or a Non-Employee
Director.
(q) "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
(r) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
(s) "Fair Market Value" shall mean (i) if the stock is listed or admitted
to trade on a national securities exchange, the closing price of the stock
on the Composite Tape, as published in the Western Edition of The Wall
Street Journal, of the principal national securities exchange on which the
stock is so listed or admitted to trade, on such date, or, if there is no
trading of the stock on such date, then the closing price of the stock as
quoted on such Composite Tape on the next preceding date on which there was
trading in such shares; (ii) if the stock is not listed or admitted to trade
on a national securities exchange, the last price for the stock on such
date, as furnished by the National Association of Securities Dealers, Inc.
("NASD") through the NASDAQ National Market Reporting System or a similar
organization if the NASD is no longer reporting such information; (iii) if
the stock is not listed or admitted to trade on a national securities
exchange and is not reported on the National Market Reporting System, the
mean between the bid and asked price for the stock on such date, as
furnished by the NASD or a similar organization; or (iv) if the stock is not
listed or admitted to trade on a national securities exchange, is not
reported on the National
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Market Reporting System and if bid and asked prices for the stock are not
furnished by the NASD or a similar organization, the value as established by
the Committee at such time for purposes of this Plan.
(t) "Incentive Stock Option" shall mean an Option which is designated as
an incentive stock option within the meaning of Section 422 of the Code, the
award of which contains such provisions (including but not limited to the
receipt of shareholder approval of this Plan, if the award is made prior to
such approval) and is made under such circumstances and to such persons as
may be necessary to comply with that section.
(u) "Nonqualified Stock Option" shall mean an Option that is designated
as a Nonqualified Stock Option and shall include any Option intended as an
Incentive Stock Option that fails to meet the applicable legal requirements
thereof. Any Option granted hereunder that is not designated as an incentive
stock option shall be deemed to be designated a nonqualified stock option
under this Plan and not an incentive stock option under the Code.
(v) "Non-Employee Director" shall mean a member of the Board of Directors
of the Corporation who is not an officer or employee of the Company.
(w) "Option" shall mean an option to purchase Common Stock granted under
this Plan. The Committee shall designate any Option granted to an Eligible
Employee as a Nonqualified Stock Option or an Incentive Stock Option.
Options granted to Non-Employee Directors shall be Nonqualified Stock
Options.
(x) "Participant" shall mean an Eligible Person who has been granted an
Award under this Plan.
(y) "Personal Representative" shall mean the person or persons who, upon
the disability or incompetence of a Participant, shall have acquired on
behalf of the Participant, by legal proceeding or otherwise, the power to
exercise the rights or receive benefits under this Plan and who shall have
become the legal representative of the Participant.
(z) "Plan" shall mean this amended and restated 1997 Stock Incentive
Plan, as amended from time to time.
(aa) "QDRO" shall mean a qualified domestic relations order as defined
in Section 414(p) of the Code or Title I, Section 206(d)(3) of ERISA (to the
same extent as if this Plan were subject thereto), or the applicable rules
thereunder.
(bb) "Restricted Stock Award" shall mean an Award of shares of Common
Stock awarded to a Participant under this Plan, subject to payment of such
consideration and such conditions on vesting (which may include, among
others, the passage of time, specified performance objectives or other
factors) and such transfer and other restrictions as are established in or
pursuant to this Plan and the related Award Agreement, to the extent such
shares remain unvested and restricted under the terms of the applicable
Award Agreement.
(cc) "Rule 16b-3" shall mean Rule 16b-3 as promulgated by the Commission
pursuant to the Exchange Act, as amended from time to time.
(dd) "Section 16 Person" shall mean a person subject to Section 16(a) of
the Exchange Act.
(ee) "Securities Act" shall mean the Securities Act of 1933, as amended
from time to time.
(ff) "Stock Bonus" shall mean an Award of shares of Common Stock granted
under this Plan for no consideration other than past services and without
restriction other than such transfer or other restrictions as the Committee
may deem advisable to assure compliance with law.
(gg) "Subsidiary" shall mean any corporation or other entity a majority
of whose outstanding voting stock or voting power is beneficially owned
directly or indirectly by the Corporation.
(hh) "Total Disability" shall mean a "permanent and total disability"
within the meaning of Section 22(e)(3) of the Code and (except in the case
of a Non-Employee Director) such other disabilities, infirmities,
afflictions or conditions as the Committee by rule may include.
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Exhibit A
AMERIGON INCORPORATED
ELIGIBLE DIRECTOR
NONQUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT dated as of the day of , 20 , by and
between Amerigon Incorporated, a California corporation (the "Corporation"),
and (the "Director").
WITNESSETH
WHEREAS, the Corporation has adopted and the shareholders of the Corporation
have approved the Amerigon Incorporated 1997 Stock Incentive Plan, as amended
and restated (the "Plan"); and
WHEREAS, pursuant to Article 3 of the Plan, the Corporation has granted an
option (the "Option") to the Director upon the terms and conditions evidenced
hereby, as required by the Plan, which Option is not intended as and shall not
be deemed to be an incentive stock option within the meaning of Section 422 of
the Code;
NOW, THEREFORE, in consideration of the services rendered and to be rendered
by the Director, the Corporation and the Director agree to the terms and
conditions set forth herein as required by the terms of the Plan.
1. Option Grant. This Agreement evidences the grant to the Director, as of
, 20 (the "Option Date"), of an Option to purchase an aggregate of
shares of Common Stock, par value [$ ] per share, under Article 3 of
the Plan, subject to the terms and conditions and to adjustment as set forth
herein or pursuant to the Plan.
2. Exercise Price. The Option entitles the Director to purchase (subject to
the terms of Sections 3 through 5 below) all or any part of the Option shares
at a price per share of $ , which amount represents the Fair Market Value
of a share on the Option Date.
3. Option Exercisability and Term. The Option will become and remain
exercisable on , 20 , subject to acceleration under Section 3.7 of
the Plan. The Option shall terminate on , 20 ,* unless earlier
terminated in accordance with the terms of Section 3.4, 3.5, or 3.7 of the Plan.
4. Service and Effect of Termination of Service. The Director agrees to
serve as a director in accordance with the provisions of the Corporation's
Articles of Incorporation, bylaws and applicable law. If the Director's
services as a member of the Board shall terminate, this Option shall terminate
at the times and to the extent set forth in Section 3.5 of the Plan.
5. General Terms. The Option and this Agreement are subject to, and the
Corporation and the Director agree to be bound by, the provisions of the Plan
that apply to the Option. Such provisions are incorporated herein by this
reference. The Director acknowledges receiving a copy of the Plan and reading
its applicable provisions. Capitalized terms not otherwise defined herein shall
have the meaning assigned to such terms in the Plan.
* Insert day before the tenth anniversary of the Option Date.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
AMERIGON INCORPORATED
(a California corporation)
By: ---------------------------------
Title: ---------------------------------
DIRECTOR
--------------------------------------
(Signature)
--------------------------------------
(Print Name)
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(Address)
(City, State, Zip Code)
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PROXY FOR COMMON STOCK
AMERIGON INCORPORATED
5462 IRWINDALE AVENUE
IRWINDALE, CALIFORNIA 91706
The undersigned, revoking all prior proxies, hereby appoints Sandra L. Grouf
and James L. Mertes as Proxies, each with the power to appoint his or her
substitute, and hereby authorizes them to represent and to vote, as designated
below, all the shares of Common Stock of Amerigon Incorporated held of record
by the undersigned on April 19, 2002 at the annual meeting of shareholders to
be held on May 22, 2002 or any adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEE IN PROPOSAL (1) AND FOR
PROPOSAL (2). WITH RESPECT TO ANY OTHER BUSINESS PROPERLY BROUGHT BEFORE THE
ANNUAL MEETING AND ANY ADJOURNMENTS THEREOF, IN THE DISCRETION OF SANDRA L.
GROUF AND JAMES L. MERTES IN ACCORDANCE WITH THEIR BEST JUDGMENT.
[X] Please mark your votes as in this example
PROPOSAL (1): The election of the nominee for director specified in the [_] FOR All nominees listed above
Proxy Statement to the Board of Directors: Lon E. Bell, Ph.D. (except as marked to the contrary
below.)
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(INSTRUCTION: To withhold authority to vote for any nominee, write that
nominee's name in the space below.)
PROPOSAL (2): Approve amendments to the 1997 Stock [_] FOR [_] AGAINST [_] ABSTAIN
Incentive Plan.
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