EXHIBIT 10.2
INTERCORP EXCELLE INC.
1997 STOCK OPTION PLAN
ARTICLE ONE
PURPOSE AND INTERPRETATION
SECTION 1.01 PURPOSE. The purpose of the Plan is to advance the interests of
the Corporation by encouraging equity participation in the Corporation through
the acquisition of Common Shares of the Corporation by directors, officers and
employees of, and certain other persons who provide services to, the
Corporation.
SECTION 1.02 DEFINITIONS. In the Plan, the following capitalized words and
terms shall have the following meanings:
(a) "ACT" means the BUSINESS CORPORATIONS ACT (ONTARIO) or its successor, as
amended from time to time.
(b) "AFFILIATE" shall have the meaning ascribed thereto in the Securities Act.
(c) "ASSOCIATE" shall have the meaning ascribed thereto in the Securities Act.
(d) "BOARD OF DIRECTORS" means the board of directors of the Corporation as
constituted from time to time and any committee of the board of directors
which shall be comprised of at least two non-employee directors.
(e) "COMMON SHARES" means the common shares of the Corporation as constituted
on the date hereof.
(f) "COMPETITOR" means any person engaged in a business that the Board of
Directors determines competes or intends to compete with the business
carried on by the Corporation and its Affiliates from time to time.
(g) "CORPORATION" means Intercorp Excelle Inc., a corporation incorporated
under the Act, and its successors from time to time.
(h) "DESIGNATED AFFILIATE" means the Affiliates of the Corporation designated
by the Board of Directors for purposes of the Plan from time to time.
(i) "EXCHANGE" means, at any time, any stock exchange on which the Common
Shares are listed, posted and called for trading.
(j) "HOLDING COMPANY" shall have the meaning specified in Section 2.02 hereof.
(k) "INSIDER" shall have the meaning ascribed thereto in the Securities Act,
other than a person who is an Insider solely by virtue of being a director
or senior officer of a subsidiary of the Corporation and any Associate of
an Insider.
(l) "KEY CONTRIBUTORS" means a person who is a director, officer, employee or
consultant engaged by the Corporation to assist the Corporation in the
conduct and growth of its business.
(m) "ISSUER BID" shall have the meaning ascribed thereto in the Securities Act.
(n) "OPTION PERIOD" means the period of time an option may be exercised as
specified in Subsection 2.07(a) hereof.
(o) "PARTICIPANT" means a participant under the Plan.
(p) "PLAN" means the share option plan provided for herein.
(q) "RRSP" shall have the meaning specified in Section 2.02 hereof.
(r) "SECURITIES LAWS" means, collectively, the applicable securities laws,
regulations, schedules, prescribed forms, policy statements, notices,
blanket rulings and other similar instruments of each of the jurisdictions
in which the Corporation is or becomes a reporting issuer or equivalent and
also includes, as the context so requires, the by-laws, rules, regulations
and policies of any Exchange.
(s) "SHARE COMPENSATION ARRANGEMENT" means a stock option, stock option plan,
employee stock purchase plan or any other compensation or incentive
mechanism involving the issuance or potential issuance of securities of the
Corporation to one or more of the following persons: (i) an employee or
insider of the Corporation or of any of its subsidiaries; and (ii) any
other person or company engaged to provide ongoing management or consulting
services for the listed company or for any entity controlled by the listed
company, including a share purchase from treasury which is financially
assisted by the Corporation by way of a loan, guarantee or otherwise.
(t) "TAKE-OVER BID" shall have the meaning ascribed thereto in the Securities
Act.
ARTICLE TWO
SHARE OPTION PLAN
SECTION 2.01 THE PLAN. The Plan is hereby established for Key Contributors of
the Corporation and Designated Affiliates.
SECTION 2.02 PARTICIPANTS. Participants in the Plan shall be Key Contributors
of the Corporation or any of its Designated Affiliates (including officers
thereof, whether or not directors) who, by the nature of their positions are, in
the opinion of the Board of Directors, upon the recommendation of the President
of the Corporation, in a position to contribute to the success of the
Corporation. At the request of any Participant, options granted to such
Participant may be issued to and registered in the name of a personal holding
company wholly-owned by such Participant ("Holding Company") or to a registered
retirement savings plan established by such Participant ("RRSP") and, in such
event, the provisions of this Plan shall apply to such options mutatis mutandis
as though they were issued to and registered in the name of the Participant.
SECTION 2.03 AMOUNT OF OPTIONS. The determination regarding the aggregate
number of Common Shares subject to options in favour of any Participant will
take into consideration the Participant's present and potential contribution to
the success of the Corporation and shall be determined from time to time by the
Board of Directors. The aggregate number of Common Shares issuable upon the
exercise of options pursuant to this Plan and any other Share Compensation
Arrangements, subject to adjustment or increase of such number pursuant to
Section 2.10 hereof, shall be 500,000 Common Shares. The maximum number of
Common Shares reserved for issuance to any one Participant upon the exercise of
options shall not exceed 5% of the total number of Common Shares outstanding
immediately prior to such issuance.
SECTION 2.04 LIMITS WITH RESPECT TO INSIDERS.
(a) The number of Common Shares issuable to Insiders pursuant to options
granted under the Plan, together with Common Shares issuable to Insiders
under any other Share Compensation Arrangement of the Corporation, shall
not:
(i) exceed 10% of the number of Common Shares outstanding immediately
prior to the grant of any such option; or
(ii) result in the issuance to Insiders, within a one year period, of in
excess of 10% of the number of Common Shares outstanding immediately
prior to the grant of any such option.
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(b) The number of Common Shares issuable to any Insider and such Insider's
Associates pursuant to options granted under the Plan, together with Common
Shares issuable to such Insider or such Insider's Associates under any
other Share Compensation Arrangement of the Corporation shall not, within a
one year period, exceed 5% of the number of Common Shares outstanding
immediately prior to the grant of any such option.
(c) Any Common Shares issuable pursuant to an option granted to a Participant
prior to the Participant becoming an Insider shall be excluded for the
purposes of the limits set out in Subsections 2.04(a) and 2.04(b) hereof.
SECTION 2.05 PRICE. The exercise price per Common Share shall be determined by
the Board of Directors at the time the option is granted, but such price shall
not be less than such price as is required or permitted as the minimum exercise
price under the Securities Laws, including the requirements of any Exchange on
which the Common Shares are listed. The exercise price of all options granted
hereunder shall be at least 85% of the fair market value of the Common Shares on
the date of grant of the options as determined by the Board of Directors.
SECTION 2.06 LAPSED OPTIONS. In the event that options granted under the Plan
are surrendered, terminate or expire without being exercised in whole or in
part, the Common Shares reserved for issuance but not purchased under such
lapsed options shall be available for subsequent options to be granted under the
Plan.
SECTION 2.07 CONSIDERATION, OPTION PERIOD AND PAYMENT.
(a) The period during which options may be exercised shall be determined by the
Board of Directors, in its discretion, to a maximum of ten years from the
date the option is granted (the "Option Period"), except as the same may be
reduced with respect to any option as provided in Sections 2.08 and 2.09
hereof respecting termination of employment or death of the Participant.
(b) Subject to any other provision of this Plan, an option may be exercised
from time to time during the Option Period by delivery to the Corporation
at its registered office of a written notice of exercise addressed to the
Secretary of the Corporation specifying the number of Common Shares with
respect to which the option is being exercised and accompanied by payment
in full of the exercise price therefor. Certificates for such Common
Shares shall be issued and delivered to the Participant as soon as
practicable following receipt of such notice and payment. The Corporation
may, at its discretion, as determined by the Board of Directors or its
nominee administering the Plan, accept in lieu of cash payment of the
exercise price, the tender of Common Shares having a fair market value
equal to the exercise price, a personal recourse note secured by a pledge
against the Common Shares so issuable, an assignment to the Corporation of
sufficient proceeds from the sale of Common Shares acquired on the exercise
of the option consented to and acknowledged by a duly qualified investment
dealer and accompanied by an irrevocable direction of the Participant
exercising such option to such investment dealer to cause such payment to
be made to the direction of the Corporation, or any combination of the
foregoing.
(c) Except as set forth in Sections 2.08 and 2.09 hereof, no option may be
exercised unless the Participant is, at the time of such exercise, a Key
Contributor of or in the employ of the Corporation or any of its Designated
Affiliates and shall have been continuously a Key Contributor since the
grant of his or her option. Absence on leave with the approval of the
Corporation or a Designated Affiliate shall not be considered an
interruption of employment for purposes of the Plan.
(d) The exercise of any option will be contingent upon receipt by the
Corporation of cash payment of the full exercise price of the Common Shares
which are the subject of the exercised option or such other arrangements
for payment as are approved by the Board of Directors or its nominee under
(b) above. No Participant or his or her legal representatives, legatees or
distributees will be, or will be deemed to be, a holder of any Common
Shares with respect to which he or she was granted an option under the
Plan, unless and until certificates for such Common Shares are issued to
him or her under the terms of the Plan.
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(e) Notwithstanding any other provision of this Plan or in any option granted
to a Participant, the Corporation's obligation to issue Common Shares to a
Participant pursuant to the exercise of an option shall be subject to:
(i) completion of such registration or other qualification of such
Common Shares or obtaining approval of such regulatory authorities
as the Corporation shall determine to be necessary or advisable in
connection with the authorization, issuance or sale thereof;
(ii) the listing of such Common Shares on any Exchange, on which the
Common Shares are listed and posted for trading; and
(iii) the receipt from the Participant of such representations,
warranties, agreements and undertakings, including as to future
dealings in such Common Shares, as the Corporation or its counsel
determines to be necessary or advisable in order to ensure
compliance with all applicable securities laws.
(f) If there is a Take-over Bid or Issuer Bid made for all or any of the issued
and outstanding Common Shares, then the Board of Directors may, by
resolution, permit all options outstanding under the Plan to become
immediately exercisable in order to permit Common Shares issuable under
such options to be tendered to such bid.
SECTION 2.08 TERMINATION OF EMPLOYMENT. If a Participant shall:
(a) cease to be a Key Contributor of the Corporation or any of its Designated
Affiliates as determined by the Board of Directors; or
(b) cease to be employed or engaged by the Corporation or any of its Designated
Affiliates (and is not or does not continue to be a director or senior
officer thereof) for any reason (other than death, disability or retirement
at or after age 70) or shall receive notice from the Corporation or any of
its Designated Affiliates of the termination of his or her employment or
engagement;
(collectively, "Termination") he or she or it may, but only within three months
next succeeding such Termination, exercise his or her or its options to the
extent that he or she or it was entitled to exercise such options at the date of
such Termination; provided that in no event shall such right extend beyond the
Option Period. This section is subject to any agreement with any director or
senior officer of the Corporation or any of its Designated Affiliates with
respect to the rights of such director or senior officer upon Termination or
change in control of the Corporation. Notwithstanding the foregoing, if the
Termination is for cause from the acceptance by the Participant of an offer of
employment with a Competitor, or if such Participant accepts employment with a
Competitor following such Termination and prior to the date that the options
held by such Participant expire under this Section 2.08, then unless otherwise
determined by the Board of Directors, the entitlement of the Participant to
options previously granted under this Plan that remain unexercised, whether or
not previously vested, shall immediately terminate. For purposes of this Plan,
employment with a competitor shall include acting on behalf of a Competitor in
any capacity, whether as a shareholder, director, officer, employee, advisor,
consultant, partner, lender or in any other capacity. In addition to the
foregoing, notwithstanding any other provision of this Plan, all Common Shares
issued to Participants on their exercise of options granted under the Plan shall
remain subject to the right of the Corporation to repurchase such Common Shares
for cancellation following any Termination of the employment of such Participant
if such Participant accepts employment with a Competitor during the period of 12
months following the effective date of such Termination. Such right of
repurchase may be exercised by the Corporation upon refunding the option
exercise price therefore paid by the Participant, such payment to be made by the
Corporation to the Participant or any subsequent holder of such Common Shares as
of the date such right is exercised by the Corporation. The Corporation shall
cause notice of such right of repurchase to be set forth on the certificates
evidencing any Common Shares issued to a Participant upon any exercise of
options granted from time to time under the Plan.
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SECTION 2.09 DEATH, DISABILITY OR RETIREMENT OF PARTICIPANT. In the event of
the death, permanent disability or retirement at or after age 70 of a
Participant who is a Key Contributor of the Corporation or any of its Designated
Affiliates or who is an employee having been continuously in the employ of the
Corporation or any of its Designated Affiliates for one year from and after the
date of the granting of his or her option, the option theretofore granted to him
or her shall be exercisable within the twelve months next succeeding such death,
disability or retirement (including the rights under Subsection 2.07(f)) and
then, in the event of death, only:
(a) by the person or persons to whom the Participant's rights under the option
shall pass by the Participant's will or the laws of descent and
distribution; and
(b) to the extent that he or she was entitled to exercise the option at the
date of his or her death, provided that in no event shall such right extend
beyond the Option Period.
SECTION 2.10 ADJUSTMENT IN SHARES SUBJECT TO THE PLAN. In the event that:
(a) there is any change in the Common Shares of the Corporation through
subdivisions or consolidations of the share capital of the Corporation, or
otherwise;
(b) the Corporation declares a dividend on Common Shares payable in Common
Shares or securities convertible into or exchangeable for Common Shares; or
(c) the Corporation issues Common Shares, or securities convertible into or
exchangeable for Common Shares, in respect of, in lieu of, or in exchange
for, existing Common Shares,
the number of Common Shares available for option, the Common Shares subject to
any option, and the option price thereof, shall be adjusted appropriately by the
Board of Directors in its sole discretion and such adjustment shall be effective
and binding for all purposes of the Plan.
SECTION 2.11 EFFECTING GRANTS. Subject to Section 3.04, the grant of options
under the Plan shall be affected by the execution and delivery of a stock option
agreement in such form which is consistent with the provisions of the Plan as
may be approved by the Board of Directors from time to time.
SECTION 2.12 RECORD KEEPING. The Corporation shall maintain a register in
which shall be recorded:
(a) the name and address of each Participant in the Plan; and
(b) the number of options granted to a Participant and the number of options
outstanding.
ARTICLE THREE
GENERAL
SECTION 3.01 TRANSFERABILITY. The benefits, rights and options accruing to any
Participant in accordance with the terms and conditions of the Plan shall not be
transferable by the Participant except (i) from the Participant to his or her
Holding Company or RRSP or from a Holding Company or RRSP to the Participant
and, in either such event, the provisions of this Plan shall apply mutatis
mutandis as though they were originally issued to and registered in the name of
the Participant, or (ii) as otherwise specifically provided herein. During the
lifetime of a Participant, all benefits, rights and options shall only be
exercised by the Participant or by his or her guardian or legal representative.
SECTION 3.02 EMPLOYMENT. Nothing contained in the Plan shall confer upon any
Participant any right with respect to employment or continuance of employment
with the Corporation or any Affiliate, or interfere in any way with the right of
the Corporation or any Affiliate to terminate the Participant's employment at
any time. Participation in the Plan by a Participant shall be voluntary.
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SECTION 3.03 DELEGATION TO COMPENSATION COMMITTEE. All of the powers
exercisable by the Board of Directors under the Plan may, to the extent
permitted by applicable law and authorized by resolution of the Board of
Directors of the Corporation, be exercised by a Compensation Committee of not
less than three (3) directors. A majority of the members of any such
Compensation Committee shall not be employees of the Corporation. In addition,
if determined appropriate by the Board of Directors of the Corporation, the
Board of Directors may delegate any or all of the powers of the Board of
Directors of the Corporation under the Plan to an independent consultant.
SECTION 3.04 ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Board of Directors of the Corporation. The Board of Directors shall be
authorized to interpret and construe the Plan and may, from time to time,
establish, amend or rescind rules and regulations required for carrying out the
purposes, provisions and administration of the Plan and determine the
Participants to be granted options, the number of Common Shares covered thereby,
the exercise price therefor and the time or times when they may be exercised.
Any such interpretation or construction of the Plan shall be final and
conclusive. All administrative costs of the Plan shall be paid by the
Corporation. The senior officers of the Corporation are hereby authorized and
directed to do all things and execute and deliver all instruments, undertakings
and applications and writings as they, in their absolute discretion, consider
necessary for the implementation of the Plan and of the rules and regulations
established for administering the Plan.
SECTION 3.05 AMENDMENT, MODIFICATION OR TERMINATION OF THE PLAN. Subject to
Section 3.03, the Board of Directors reserves the right to amend, modify or
terminate the Plan at any time if and when it is advisable in the absolute
discretion of the Board of Directors. However, any amendment of the Plan which
would:
(a) materially increase the benefits under the Plan;
(b) increase the number of Common Shares which may be issued under the Plan; or
(c) materially modify the requirements as to the eligibility for participation
in the Plan;
shall be effective only upon the approval of the shareholders of the
Corporation. Any material amendment to any provision of the Plan shall be
subject to any necessary approvals by the Exchange, other quotation system or
any stock exchange or regulatory body having jurisdiction over the securities of
the Corporation. Notwithstanding the foregoing, the Plan will terminate 10
years from the date hereof.
SECTION 3.06 APPLICATION FOR RULING UNDER THE SECURITIES ACT. The
Corporation is not a "private company" (as defined in the Securities Act and,
accordingly, is not entitled to the exemptions for such companies from the
registration and prospectus requirements of the Securities Act where they are
not offered for sale to the public. In order to ensure compliance with the
Securities Act, the grant of options under the Plan to Key Contributors other
than officers and employees of the Corporation and its Affiliates shall be
subject to receipt of such rulings or other relief as may be required under the
Securities Act that the granting and exercise of such options shall not be
subject to the prospectus and registration requirements of the Securities Act,
subject to such terms and conditions as the Board of Directors may in its
absolute discretion approve.
SECTION 3.07 CONSOLIDATION, MERGER, ETC. If there is a change in control,
which is defined as a consolidation, merger or statutory amalgamation or
arrangement of the Corporation with or into another corporation, a separation of
the business of the Corporation into two or more entities, a transfer of all or
substantially all of the assets of the Corporation to another entity, or the
change in the majority of the board or directors other than by election by the
shareholders pursuant to board solicitation or by vacancies filled by the board
caused by death or resignation of such person, upon the exercise of an option
under the Plan, the holder thereof shall be entitled to receive the securities,
property or cash which the holder would have received upon such consolidation,
merger, amalgamation, arrangement, separation or transfer if the holder had
exercised the option immediately prior to such event, unless the directors of
the Corporation otherwise determine the basis upon which such option shall be
exercisable.
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SECTION 3.08 NO REPRESENTATION OR WARRANTY. The Corporation makes no
representation or warranty as to the future market value of any Common Shares
issued in accordance with the provisions of the Plan.
SECTION 3.09 INTERPRETATION. This Plan shall be governed by and construed in
accordance with the laws of the Province of Ontario.
SECTION 3.10 APPROVAL AND EFFECTIVE DATE. This Plan shall be effective as of
the date it is approved by the Board of Directors and any securities regulatory
body or stock exchange in Canada having jurisdiction over the securities of the
Corporation.
Dated May 1 , 1997.
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