EXHIBIT 4.1
R-TEC HOLDING, INC.
2000 STOCK OPTION PLAN
1. Purpose of the Plan. The purpose of this 2000 Stock Option Plan (the
"Plan") of R-Tec Holding, Inc., an Idaho corporation (the "Company"), is to
provide the Company with a means of attracting and retaining the services of
highly motivated and qualified directors and key personnel. The Plan is intended
to advance the interests of the Company by affording to directors and key
employees, upon whose skill, judgment, initiative and efforts the Company is
largely dependent for the successful conduct of its business, an opportunity for
investment in the Company and the incentives inherent in stock ownership in the
Company. In addition, the Plan contemplates the opportunity for investment in
the Company by consultants of the Company and by employees of companies that do
business with the Company. For purposes of this Plan, the term "Company" shall
include subsidiaries, if any, of the Company.
2. Legal Compliance. It is the intent of the Plan that all options granted
under it ("Options") shall be either "Incentive Stock Options" ("ISOs"), as such
term is defined in Section 422 of the Internal Revenue Code of 1986, as amended
("Code"), or non-qualified stock options ("NQOs"); provided, however, ISOs shall
be granted only to employees of the Company. An Option shall be identified as an
ISO or an NQO in writing in the document or documents evidencing the grant of
the Option. All Options that are not so identified as ISOs are intended to be
NQOs. In addition, the Plan provides for the grant of NQOs to consultants of the
Company and to employees of companies that do business with the Company. It is
the further intent of the Plan that it conform in all respects with the
requirements of Rule 16b-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended ("Rule 16b-3"). To the extent that
any aspect of the Plan or its administration shall at any time be viewed as
inconsistent with the requirements of Rule 16b-3 or, in connection with ISOs,
the Code, such aspect shall be deemed to be modified, deleted or otherwise
changed as necessary to ensure continued compliance with such provisions.
3. Administration of the Plan.
3.1 Plan Committee. The Plan shall be administered by a committee
("Committee"). The members of the Committee shall be appointed from time to
time by the Board of Directors of the Company ("Board") and shall consist
of not less than two nor more than five persons. Such persons shall be
directors of the Company or as otherwise designated. Notwithstanding the
foregoing, the Board may act as the Committee at any time or from time to
time.
3.2 Grants of Options by the Committee. In accordance with the
provisions of the Plan, the Committee, by resolution, shall select those
eligible persons to whom Options shall be granted ("Optionees"); shall
determine the time or times at which each Option shall be granted, whether
an Option is an ISO or an NQO and the number of shares to be subject to
each Option; and shall fix the time and manner in which the Option may be
exercised, the Option exercise price, and the Option period. The Committee
shall determine the form of Option agreement to evidence the foregoing
terms and conditions of each Option, which need not be identical, in the
form provided for in Section 7. Such Option agreement may include such
other provisions as the Committee may deem necessary or desirable
consistent with the Plan, the Code and Rule 16b-3.
3.3 Committee Procedures. The Committee from time to time may adopt
such rules and regulations for carrying out the purposes of the Plan as it
may deem proper and in the best interests of the Company. The Committee
shall keep minutes of its meetings and records of its actions. A majority
of the members of the Committee shall constitute a quorum for the
transaction of any business by the Committee. The Committee may act at any
time by an affirmative vote of a majority of those members voting. Such
vote may be taken at a meeting (which may be conducted in person or by any
telecommunication medium) or by written consent of Committee members
without a meeting.
3.4 Finality of Committee Action. The Committee shall resolve all
questions arising under the Plan and Option agreements entered into
pursuant to the Plan. Each determination, interpretation, or other action
made or taken by the Committee shall be final and conclusive and binding on
all persons, including, without limitation, the Company, its stockholders,
the Committee and each of the members of the Committee, and the directors,
officers and employees of the Company, including Optionees and their
respective successors in interest.
3.5 Non-Liability of Committee Members. No Committee member shall be
liable for any action or determination made by him or her in good faith
with respect to the Plan or any Option granted under it.
4. Board Power to Amend, Suspend, or Terminate the Plan. The Board may,
from time to time, make such changes in or additions to the Plan as it may deem
proper and in the best interests of the Company and its stockholders. The Board
may also suspend or terminate the Plan at any time, without notice, and in its
sole discretion. Notwithstanding the foregoing, no such change, addition,
suspension, or termination by the Board shall (i) materially impair any Option
previously granted under the Plan without the express written consent of the
Optionee; or (ii) materially increase the number of shares subject to the Plan,
materially increase the benefits accruing to Optionees under the Plan,
materially modify the requirements as to eligibility to participate in the Plan
or alter the method of determining the Option exercise price described in
Section 8, without stockholder approval.
5. Shares Subject to the Plan. For purposes of the Plan, the Committee is
authorized to grant Options for up to 2,000,000 shares of the Company's common
stock ("Common Stock"), or the number and kind of shares of stock or other
securities which, in accordance with Section 13, shall be substituted for such
shares of Common Stock or to which such shares shall be adjusted. The Committee
is authorized to grant Options under the Plan with respect to such shares. Any
or all unsold shares subject to an Option which for any reason expires or
otherwise terminates (excluding shares returned to the Company in payment of the
exercise price for additional shares) may again be made subject to grant under
the Plan.
6. Optionees. Options shall be granted only to officers, directors or key
employees of the Company, consultants of the Company or employees of companies
that do business with the Company designated by the Committee from time to time
as Optionees. Any Optionee may hold more than one Option to purchase Common
Stock, whether such Option is an Option held pursuant to the Plan or otherwise.
An Optionee who is an employee of the Company ("Employee Optionee") and who
holds an Option must remain a continuous full or part-time (working at least 30
hours per week) employee of the Company from the time of grant of the Option to
such employee until the time of its exercise, except as provided in Section
10.3.
7. Grants of Options. The Committee shall have the sole discretion to grant
Options under the Plan and to determine whether any Option shall be an ISO or an
NQO. The terms and conditions of Options granted under the Plan may differ from
one another as the Committee, in its absolute discretion, shall determine as
long as all Options granted under the Plan satisfy the requirements of the Plan.
Upon determination by the Committee that an Option is to be granted to an
Optionee, a written Option agreement evidencing such Option shall be given to
the Optionee, specifying the number of shares subject to the Option, the Option
exercise price, whether the Option is an ISO or an NQO, and the other individual
terms and conditions of such Option. Such Option agreement may incorporate
generally applicable provisions from the Plan, a copy of which shall be provided
to all Optionees at the time of their initial grants under the Plan. The Option
shall be deemed granted as of the date specified in the grant resolution of the
Committee, and the Option agreement shall be dated as of the date of such
resolution. Notwithstanding the foregoing, unless the Committee consists solely
of non-employee directors, any Option granted to an executive officer, director
or 10% beneficial owner for purposes of Section 16 of the Securities Exchange
Act of 1934, as amended ("Section 16 of the 1934 Act"), shall either be (a)
conditioned upon the Optionee's agreement not to sell the shares of Common Stock
underlying the Option for at least six months after the date of grant or (b)
approved by the entire Board or by the stockholders of the Company.
8. Option Exercise Price. The price per share to be paid by the Optionee at
the time an ISO is exercised shall not be less than 100% of the Fair Market
Value (as hereinafter defined) of one share of the optioned Common Stock on the
date on which the Option is granted. No ISO may be granted under the Plan to any
person who, at the time of such grant, owns (within the meaning of Section
424(d) of the Code) stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company or of any parent thereof, unless
the exercise price of such ISO is at least equal to 110% of Fair Market Value on
the date of grant. The price per share to be paid by the Optionee at the time an
NQO is exercised shall not be less than 85% of the Fair Market Value on the date
on which the NQO is granted, as determined by the Committee. For purposes of the
Plan, the "Fair Market Value" of a share of the Company's Common Stock as of a
given date shall be: (i) the closing price of a share of the Company's Common
Stock on the principal exchange on which shares of the Company's Common Stock
are then trading, if any, on the day immediately preceding such date, or, if
shares were not traded on such date, then on the next preceding trading day
during which a sale occurred; or (ii) if the Company's Common Stock is not
traded on an exchange but is quoted on Nasdaq or a successor quotation system,
(1) the last sales price (if the Common Stock is then listed as a National
Market Issue under the Nasdaq National Market System) or (2) the closing
representative bid price (in all other cases) for the Common Stock on the day
immediately preceding such date as reported by Nasdaq or such successor
quotation system; or (iii) if the Company's Common Stock is not publicly traded
on an exchange and not quoted on Nasdaq or a successor quotation system, the
closing bid price for the Common Stock on such date as determined in good faith
by the Committee; or (iv) if the Company's Common Stock is not publicly traded,
the fair market value established by the Committee acting in good faith. In
addition, with respect to any ISO, the Fair Market Value on any given date shall
be determined in a manner consistent with any regulations issued by the
Secretary of the Treasury for the purpose of determining fair market value of
securities subject to an ISO plan under the Code.
9. Ceiling of ISO Grants. The aggregate Fair Market Value (determined at
the time any ISO is granted) of the Common Stock with respect to which an
Optionee's ISOs, together with incentive stock options granted under any other
plan of the Company and any parent, are exercisable for the first time by such
Optionee during any calendar year shall not exceed $100,000. If an Optionee
holds such incentive stock options that become first exercisable (including as a
result of acceleration of exercisability under the Plan) in any one year for
shares having a Fair Market Value at the date of grant in excess of $100,000,
then the most recently granted of such ISOs, to the extent that they are
exercisable for shares having an aggregate Fair Market Value in excess of such
limit, shall be deemed to be NQOs.
10. Duration, Exercisability, and Termination of Options.
10.1 Option Period. The Option period shall be determined by the
Committee with respect to each Option granted. In no event, however, may
the Option period exceed ten years from the date on which the Option is
granted, or five years in the case of a grant of an ISO to an Optionee who
is a 10% stockholder at the date on which the Option is granted as
described in Section 8.
10.2 Exercisability of Options. Each Option shall be exercisable in
whole or in consecutive installments, cumulative or otherwise, during its
term as determined in the discretion of the Committee.
10.3 Termination of Options due to Termination of Employment,
Disability, or Death of Optionee; Termination for "Cause," or Resignation
in Violation of an Employment Agreement. All Options granted under the Plan
to any Employee Optionee shall terminate and may no longer be exercised if
the Employee Optionee ceases, at any time during the period between the
grant of the Option and its exercise, to be a full or part-time (working at
least 30 hours per week) employee of the Company; provided, however, that
the Committee may alter the termination date of the Option if the Optionee
transfers to an affiliate of the Company. Notwithstanding the foregoing,
(i) if the Employee Optionee's employment with the Company shall have
terminated for any reason (other than involuntary dismissal for "cause" or
voluntary resignation in violation of any agreement to remain in the employ
of the Company, including, without limitation, any such agreement pursuant
to Section 15), he may, at any time before the expiration of three months
after such termination or before expiration of the Option, whichever shall
first occur, exercise the Option (to the extent that the Option was
exercisable by him on the date of the termination of his employment); (ii)
if the Employee Optionee's employment shall have terminated due to
disability (as defined in Section 22(e)(3) of the Code and subject to such
proof of disability as the Committee may require), such Option may be
exercised by the Employee Optionee (or by his guardian(s), or
conservator(s), or other legal representative(s)) before the expiration of
twelve months after such termination or before expiration of the Option,
whichever shall first occur (to the extent that the Option was exercisable
by him on the date of the termination of his employment); (iii) in the
event of the death of an Optionee, an Option exercisable by him at the date
of his death shall be exercisable by his legal representative(s),
legatee(s), or heir(s), or by his beneficiary or beneficiaries so
designated by him, as the case may be, within twelve months after his death
or before the expiration of the Option, whichever shall first occur (to the
extent that the Option was exercisable by him on the date of his death);
and (iv) if the Employee Optionee's employment is terminated for "cause" or
in violation of any agreement to remain in the employ of the Company,
including, without limitation, any such agreement pursuant to Section 14,
his Option shall terminate immediately upon termination of employment, and
such Option shall be deemed to have been forfeited by the Optionee. For
purposes of the Plan, "cause" may include, without limitation, any illegal
or improper conduct (1) which injures or impairs the reputation, goodwill,
or business of the Company; (2) which involves the misappropriation of
funds of the Company, or the misuse of data, information, or documents
acquired in connection with employment by the Company; or (3) which
violates any other directive or policy promulgated by the Company. A
termination for "cause" may also include any resignation in anticipation of
discharge for "cause" or resignation accepted by the Company in lieu of a
formal discharge for "cause."
11. Manner of Option Exercise; Rights and Obligations of Optionees.
11.1 Written Notice of Exercise. An Optionee may elect to exercise an
Option in whole or in part, from time to time, subject to the terms and
conditions contained in the Plan and in the agreement evidencing such
Option, by giving written notice of exercise to the Company at its
principal executive office.
11.2 Cash Payment for Optioned Shares. If an Option is exercised for
cash, such notice shall be accompanied by a cashier's or personal check, or
money order, made payable to the Company for the full exercise price of the
shares purchased.
11.3 Stock Swap Feature. At the time of the Option exercise, and
subject to the discretion of the Committee to accept payment in cash only,
the Optionee may determine whether the total purchase price of the shares
to be purchased shall be paid solely in cash or by transfer from the
Optionee to the Company of previously acquired shares of Common Stock, or
by a combination thereof. If the Optionee elects to pay the total purchase
price in whole or in part with previously acquired shares of Common Stock,
the value of such shares shall be equal to their Fair Market Value on the
date of exercise, determined by the Committee in the same manner used for
determining Fair Market Value at the time of grant for purposes of Section
8.
11.4 Investment Representation for Non-Registered Shares and Legality
of Issuance. The receipt of shares of Common Stock upon the exercise of an
Option shall be conditioned upon the Optionee (or any other person who
exercises the Option on his or her behalf as permitted by Section 10.3)
providing to the Committee a written representation that, at the time of
such exercise, it is the intent of such person(s) to acquire the shares for
investment only and not with a view toward distribution. The certificate
for unregistered shares issued for investment shall be restricted by the
Company as to transfer unless the Company receives an opinion of counsel
satisfactory to the Company to the effect that such restriction is not
necessary under then pertaining law. The providing of such representation
and such restrictions on transfer shall not, however, be required upon any
person's receipt of shares of Common Stock under the Plan in the event
that, at the time of grant of the Option relating to such receipt or upon
such receipt, whichever is the appropriate measure under applicable federal
or state securities laws, the shares subject to the Option shall be (i)
covered by an effective and current registration statement under the
Securities Act of 1933, as amended, and (ii) either qualified or exempt
from qualification under applicable state securities laws. The Company
shall, however, under no circumstances be required to sell or issue any
shares under the Plan if, in the opinion of the Committee, (i) the issuance
of such shares would constitute a violation by the Optionee or the Company
of any applicable law or regulation of any governmental authority, or (ii)
the consent or approval of any governmental body is necessary or desirable
as a condition of, or in connection with, the issuance of such shares.
11.5 Stockholder Rights of Optionee. Upon exercise, the Optionee (or
any other person who exercises the Option on his behalf as permitted by
Section 10.3) shall be recorded on the books of the Company as the owner of
the shares, and the Company shall deliver to such record owner one or more
duly issued stock certificates evidencing such ownership. No person shall
have any rights as a stockholder with respect to any shares of Common Stock
covered by an Option granted pursuant to the Plan until such person shall
have become the holder of record of such shares. Except as provided in
Section 13, no adjustments shall be made for cash dividends or other
distributions or other rights as to which there is a record date preceding
the date such person becomes the holder of record of such shares.
11.6 Holding Periods for Tax Purposes. The Plan does not provide that
an Optionee must hold shares of Common Stock acquired under the Plan for
any minimum period of time. Optionees are urged to consult with their own
tax advisors with respect to the tax consequences to them of their
individual participation in the Plan.
12. Successive Grants. Successive grants of Options may be made to any
Optionee under the Plan.
13. Adjustments.
(a) If the outstanding Common Stock shall be hereafter increased or
decreased, or changed into or exchanged for a different number or kind of
shares or other securities of the Company or of another corporation, by
reason of a recapitalization, reclassification, reorganization, merger,
consolidation, share exchange, or other business combination in which the
Company is the surviving parent corporation, stock split-up, combination of
shares, or dividend or other distribution payable in capital stock or
rights to acquire capital stock, appropriate adjustment shall be made by
the Committee in the number and kind of shares for which Options may be
granted under the Plan. In addition, the Committee shall make appropriate
adjustment in the number and kind of shares as to which outstanding and
unexercised Options shall be exercisable, to the end that the proportionate
interest of the holder of the Option shall, to the extent practicable, be
maintained as before the occurrence of such event. Such adjustment in
outstanding Options shall be made without change in the total price
applicable to the unexercised portion of the Option but with a
corresponding adjustment in the exercise price per share.
(b) In the event of the dissolution or liquidation of the Company, any
outstanding and unexercised Options shall terminate as of a future date to
be fixed by the Committee.
(c) In the event of a Reorganization (as hereinafter defined), then,
(i) If there is no plan or agreement with respect to the
Reorganization ("Reorganization Agreement"), or if the Reorganization
Agreement does not specifically provide for the adjustment, change,
conversion, or exchange of the outstanding and unexercised Options for
cash or other property or securities of another corporation, then any
outstanding and unexercised Options shall terminate as of a future
date to be fixed by the Committee; or
(ii) If there is a Reorganization Agreement, and the
Reorganization Agreement specifically provides for the adjustment,
change, conversion, or exchange of the outstanding and unexercised
Options for cash or other property or securities of another
corporation, then the Committee shall adjust the shares under such
outstanding and unexercised Options, and shall adjust the shares
remaining under the Plan which are then available for the issuance of
Options under the Plan if the Reorganization Agreement makes specific
provisions therefor, in a manner not inconsistent with the provisions
of the Reorganization Agreement for the adjustment, change,
conversion, or exchange of such Options and shares.
(d) The term "reorganization" as used in this Section 13 shall mean
any reorganization, merger, consolidation, share exchange, or other
business combination pursuant to which the Company is not the surviving
parent corporation after the effective date of the Reorganization, or any
sale or lease of all or substantially all of the assets of the Company.
Nothing herein shall require the Company to adopt a Reorganization
Agreement, or to make provision for the adjustment, change, conversion, or
exchange of any Options, or the shares subject thereto, in any
Reorganization Agreement which it does adopt.
(e) The Committee shall provide to each Optionee then holding an
outstanding and unexercised Option not less than 30 calendar days' advanced
written notice of any date fixed by the Committee pursuant to this Section
13 and of the terms of any Reorganization Agreement providing for the
adjustment, change, conversion, or exchange of outstanding and unexercised
Options. Except as the Committee may otherwise provide, each Optionee shall
have the right during such period to exercise his Option only to the extent
that the Option was exercisable on the date such notice was provided to the
Optionee.
Any adjustment to any outstanding ISO pursuant to this Section 13, if
made by reason of a transaction described in Section 424(a) of the Code,
shall be made so as to conform to the requirements of that Section and the
regulations thereunder. If any other transaction described in Section
424(a) of the Code affects the Common Stock subject to any unexercised ISO
theretofore granted under the Plan (hereinafter for purposes of this
Section 13 referred to as the "old option"), the Board of Directors of the
Company or of any surviving or acquiring corporation may take such action
as it deems appropriate, in conformity with the requirements of that Code
Section and the regulations thereunder, to substitute a new option for the
old option, in order to make the new option, as nearly as may be
practicable, equivalent to the old option, or to assume the old option.
(f) No modification, extension, renewal, or other change in any Option
granted under the Plan may be made, after the grant of such Option, without
the Optionee's consent, unless the same is permitted by the provisions of
the Plan and the Option agreement. In the case of an ISO, Optionees are
hereby advised that certain changes may disqualify the ISO from being
considered as such under Section 422 of the Code, or constitute a
modification, extension, or renewal of the ISO under Section 424(h) of the
Code.
(g) All adjustments and determinations under this Section 13 shall be
made by the Committee in good faith in its sole discretion.
14. Continued Employment. As determined in the sole discretion of the
Committee at the time of grant and if so stated in a writing signed by the
Company, each Option may have as a condition the requirement of an Employee
Optionee to remain in the employ of the Company, or of its affiliates, and to
render to it his or her exclusive service, at such compensation as may be
determined from time to time by it, for a period not to exceed the term of the
Option, except for earlier termination of employment by or with the express
written consent of the Company or on account of disability or death. The failure
of any Employee Optionee to abide by such agreement as to any Option under the
Plan may result in the termination of all of his or her then outstanding Options
granted pursuant to the Plan. Neither the creation of the Plan nor the granting
of Option(s) under it shall be deemed to create a right in an Employee Optionee
to continued employment with the Company, and each such Employee Optionee shall
be and shall remain subject to discharge by the Company as though the Plan had
never come into existence. Except as specifically provided by the Committee in
any particular case, the loss of existing or potential profit in Options granted
under this Plan shall not constitute an element of damages in the event of
termination of the employment of an employee even if the termination is in
violation of an obligation of the Company to the employee by contract or
otherwise.
15. Tax Withholding. The exercise of any Option granted under the Plan is
subject to the condition that if at any time the Company shall determine, in its
discretion, that the satisfaction of withholding tax or other withholding
liabilities under any federal, state or local law is necessary or desirable as a
condition of, or in connection with, such exercise or a later lapsing of time or
restrictions on or disposition of the shares of Common Stock received upon such
exercise, then in such event, the exercise of the Option shall not be effective
unless such withholding shall have been effected or obtained in a manner
acceptable to the Company. When an Optionee is required to pay to the Company an
amount required to be withheld under applicable income tax laws in connection
with the exercise of any Option, the Optionee may, subject to the approval of
the Committee, which approval shall not have been disapproved at any time after
the election is made, satisfy the obligation, in whole or in part, by electing
to have the Company withhold shares of Common Stock having a value equal to the
amount required to be withheld. The value of the Common Stock withheld pursuant
to the election shall be determined by the Committee, in accordance with the
criteria set forth in Section 8, with reference to the date the amount of tax to
be withheld is determined. The Optionee shall pay to the Company in cash any
amount required to be withheld that would otherwise result in the withholding of
a fractional share. The election by an Optionee who is an officer of the Company
within the meaning of Section 16 of the 1934 Act, to be effective, must meet all
of the requirements of Section 16 of the 1934 Act.
16. Term of Plan.
a. Effective Date. The Plan shall become effective as of December 12,
2000.
b. Termination Date. Except as to Options granted and outstanding
under the Plan prior to such time, the Plan shall terminate at midnight on
December 12, 2010, and no Option shall be granted after that time. Options
then outstanding may continue to be exercised in accordance with their
terms. The Plan may be suspended or terminated at any earlier time by the
Board within the limitations set forth in Section 4.
17. Non-Exclusivity of the Plan. Nothing contained in the Plan is intended
to amend, modify, or rescind any previously approved compensation plans,
programs or options entered into by the Company. This Plan shall be construed to
be in addition to and independent of any and all such other arrangements.
Neither the adoption of the Plan by the Board nor the submission of the Plan to
the stockholders of the Company for approval shall be construed as creating any
limitations on the power or authority of the Board to adopt, with or without
stockholder approval, such additional or other compensation arrangements as the
Board may from time to time deem desirable.
18. Governing Law. The Plan and all rights and obligations under it shall
be construed and enforced in accordance with the laws of the State of Idaho.
19. Information to Optionees. Optionees under the Plan who do not otherwise
have access to financial statements of the Company will receive the Company's
financial statements at least annually.