EXHIBIT 10.44
VOICECOM HOLDINGS, INC.
1995 STOCK OPTION PLAN
1. Statement of Purpose.
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The principal purposes of this Stock Option Plan ("Plan") are to secure to
VoiceCom Systems, Inc. (the "Company") the advantages of the incentive inherent
in stock ownership on the part of employees, officers, directors, and
consultants responsible for the continued success of the Company and to create
in such individuals a proprietary interest in, and a greater concern for, the
welfare of the Company through the grant of options to acquire shares of the
common stock of the Company ("Common Stock"). Each incentive stock option
("ISO") granted hereunder is intended to constitute an "incentive stock option,"
as such term is defined in Section 422 of the Internal Revenue Code of 1986, as
the same may be amended from time to time (the "Code"), and this Plan and each
such ISO is intended to comply with all of the requirements of said Section 422
and of all other provisions of the Code applicable to incentive stock options
and to plans issuing the same. Each nonstatutory stock option ("Non-ISO")
granted hereunder is intended to constitute a nonstatutory stock option that
does not comply with the requirements of Section 422 of the Code. ISOs and Non-
ISOs shall sometimes hereinafter be referred to collectively as "Options." This
Plan is expected to benefit shareholders by enabling the Company to attract and
retain personnel of the highest caliber by offering to them an opportunity to
share in any increase in the value of the Common Stock to which such personnel
have contributed.
2. Administration.
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2.1 This Plan shall be administered by the Board of Directors of the
Company (the "Board") or by a committee of the Board appointed in accordance
with Section 2.2 or 2.4.2 below (the Board, or such committee, if appointed,
will be referred to in this Plan as the "Committee").
2.2 The Board may at any time appoint a Committee, consisting of not less
than two (2) of its members, to administer this Plan on behalf of the Board in
accordance with such terms and conditions not inconsistent with this Plan as the
Board may prescribe. Once appointed, the Committee shall continue to serve
until otherwise directed by the Board. From time to time the Board may increase
the size of the Committee and appoint additional members, remove members (with
or without cause) and appoint new members in their place, fill vacancies however
caused, and/or remove all members of the Committee and thereafter directly
administer this Plan.
2.3 A majority of the members of the Committee shall constitute a quorum,
and, subject to the limitations in this Section 2, all actions of the Committee
shall require the affirmative vote of members who constitute a majority of such
quorum.
Members of the Committee who are not Disinterested Persons (as defined in
Section 2.5) may vote on any matters affecting the administration of this Plan
or the grant of Options hereunder, except that no such member shall act upon the
granting of an Option hereunder to himself or herself (but any such member may
be counted in determining the existence of a quorum at any meeting of the
Committee during which action is taken with respect to the granting of Options
to himself or herself).
2.4 Notwithstanding the foregoing provisions of this Section 2, if the
Company registers any class of any equity security pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), this Plan
shall, from the effective date of such registration until six (6) months after
the termination of such registration, be administered as follows:
2.4.1 This Plan shall be administered by the Board (regardless of
whether or not a Committee has been appointed under Section 2.2), so long as
each member of the Board is a Disinterested Person, or by a Committee appointed
in accordance with Section 2.4.2 below.
2.4.2 If at any time not all members of the Board are Disinterested
Persons, then the Board shall appoint a Committee consisting of two (2) or more
of its members, all of whom are Disinterested Persons, to administer this Plan
on behalf of the Board in accordance with such terms and conditions not
inconsistent with this Plan as the Board may prescribe. Once appointed, the
Committee shall continue to serve until otherwise directed by the Board. From
time to time the Board may increase the size of the Committee and appoint
additional members (all of whom shall be Disinterested Persons), remove members
(with or without cause) and appoint new members in their place, fill vacancies
however caused, or remove all members of the Committee and thereafter directly
administer this Plan so long as all members of the Board are Disinterested
Persons. At no time shall a person who is not a Disinterested Person serve on
the Committee appointed under this Section 2.4.2, nor shall such Committee at
any time have less than two (2) members.
2.5 The term "Disinterested Person" shall mean a director who qualifies as
a disinterested person as defined in 17 C.F.R. 240.16b-3(c)(2)(i), as the same
may be amended from time to time.
2.6 The Committee shall have the authority to do the following:
2.6.1 To administer this Plan in accordance with its express terms;
2.6.2 To determine all questions arising in connection with the
administration, interpretation, and application of this Plan, including all
questions relating to the value of the Common Stock;
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2.6.3 To correct any defect, supply any information, or reconcile any
inconsistency in such manner and to such extent as shall be deemed necessary or
advisable to carry out the purposes of this Plan;
2.6.4 To prescribe, amend, and rescind rules and regulations relating
to the administration of this Plan;
2.6.5 To determine the duration and purposes of leaves of absence which
may be granted to participants without constituting a termination of employment
for purposes of this Plan;
2.6.6 To do the following with respect to the granting of Options:
(a) Based on the eligibility criteria in Section 3 below, to
determine the employees, officers, directors, or consultants to whom Options
shall be granted;
(b) To determine whether such Options shall be ISOs or Non-ISOs.
(c) To determine the terms and provisions of the Option to be
granted to any Optionee hereunder (which need not be identical with the terms of
any other Option), and, with the consent of such Optionee, to modify and amend
such terms and provisions;
(d) To determine when such Options shall be granted;
(e) To determine the number of shares of Common Stock subject to
each Option; and
2.6.7 To make all other determinations necessary or advisable for
administration of this Plan.
2.7 The Committee's exercise of the authority set out in Section 2.6 shall
be consistent with the intent that the ISOs granted hereunder be qualified under
the terms of Section 422 of the Code, and that the Non-ISOs granted hereunder
shall not be so qualified. All determinations made by the Committee in good
faith on matters referred to in Section 2.6 shall be final, conclusive, and
binding upon all persons. The Committee shall have all powers necessary or
appropriate to accomplish its duties under this Plan.
3. Eligibility
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3.1 ISOs may be granted to any employee of the Company or of an Affiliate
of the Company, as defined in Section 3.2 below. Non-ISOs may be granted to any
employee, officer or director (whether or not also an employee), or consultant
of the
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Company or of an Affiliate of the Company. Each employee. officer, director, or
consultant selected by the Committee to receive an Option shall sometimes
hereinafter be referred to as an "Optionee."
3.2 As used in this Plan, an "Affiliate" of a corporation shall refer to a
a "parent corporation" of such corporation as described in Section 424(e) of the
Code or a "subsidiary corporation" of such corporation as described in Section
424(f) of the Code.
3.3 An Optionee who is not an employee of the Company or of an Affiliate
of the Company shall not be eligible to receive an ISO hereunder and no ISOs
shall be granted to any such non-employee Optionee.
3.4 No Option shall be granted hereunder to any Optionee unless the
Committee shall have determined, based on the advice of counsel, that the grant
of such option (and the exercise thereof by the Optionee) will not violate the
securities law of the state where the Optionee resides.
4. Shares Subject to the Plan.
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4.1 The Committee, from time to time, may provide for the option and sale
in the aggregate of up to Two Million Seven Hundred and Twenty-Five Thousand
(2,725,000) shares of Common Stock, to be made available from authorized, but
unissued, or reacquired shares of Common Stock; provided, however, that at the
time any Option is issued hereunder, the total number of shares of Common Stock
for which Options issued hereunder are then exercisable (assuming full vesting
but net of terminated, expired or exercised Options) shall not exceed 2,725,000
minus the sum of (a) the number of shares of Common Stock for which options
under the Company's 1985 Stock Option Plan, as amended (the "1985 Plan"), are
then exercisable (assuming full vesting, but net of terminated, expired or
exercised options), plus (b) the number of shares issued upon exercise of
options granted under the 1985 Plan from and after June 29, 1995. The number of
such shares shall be adjusted to take account of the events referred to in
Section 10 hereof.
4.2 Upon exercise of an Option, the number of shares of Common Stock
thereafter available hereunder and under the Option shall decrease by the number
of shares of Common Stock as to which such Option was exercised; provided that
if such shares are pledged to secure a promissory note given in payment of the
Option Price for such shares and, as a result of a default on such note, the
pledged shares are returned to the Company, then such shares shall again be
available for the purposes of this Plan.
4.3 If any Option granted hereunder shall expire or terminate for any
reason without having been exercised in full, the unpurchased shares subject
thereto shall again be available for the purposes of this Plan.
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4.4 The Company shall at all times during the term of this Plan reserve
and keep available such number of shares as shall be sufficient to satisfy the
requirements of the Plan.
5. Option Terms.
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5.1 The Committee shall specify the following terms to be contained in
each Option granted to an Optionee hereunder, which Option shall be executed by
the Company and such Optionee:
5.1.1 Whether such Option is an ISO or a Non-ISO;
5.1.2 The number of shares of Common Stock subject to purchase pursuant
to such Option;
5.1.3 The date on which the grant of such Option shall be effective
(the "Date of Grant");
5.1.4 The period of time during which such Option shall be exercisable,
which shall in no event be more than ten (10) years following its Date of Grant;
provided, however, that if an ISO is granted to an Optionee who on the Date of
Grant owns, either directly or indirectly within the meaning of Section 424(d)
of the Code, more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or an Affiliate of the Company, the period
of time during which such Option shall be exercisable shall in no event be more
than five (5) years following its Date of Grant;
5.1.5 The price at which such Option shall be exercisable by the
Optionee (the "Option Price"); provided, however, that the Option Price
specified in ISOs shall in no event be less than the fair market value, as
defined in Section 5.2 below, on the Date of Grant, of the shares of Common
Stock subject thereto; and provided further that, if such Option is granted to
an Optionee who on the Date of Grant owns, either directly or indirectly within
the meaning of Section 424(d) of the Code, more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or an
Affiliate of the Company, then the Option Price specified in such Option shall
be at least one hundred ten percent (110%) of the fair market value, on the Date
of Grant, of the Common Stock subject thereto;
5.1.6 Any vesting schedule upon which the exercise of an Option is
contingent; provided that the Committee shall have complete discretion with
respect to the terms of any vesting schedule upon which the exercise of an
Option is contingent, including, without limitation, discretion (a) to allow
full and immediate vesting upon grant of such Option, (b) to permit partial
vesting in stated percentage amounts based on the length of the holding period
of such Option, or (c) to permit full vesting after a stated holding period has
passed; and
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5.1.7 Such other terms and conditions as the Committee deems advisable
and as are consistent with the purpose of this Plan.
5.2 Fair market value shall be determined as follows:
5.2.1 If the Company's Common Stock is publicly traded at the time an
Option is granted hereunder, fair market value shall be determined as of the
last business day for which the prices or quotes discussed in this Section 5.2.1
are available prior to the date such Option is granted and shall mean:
(a) The average (on that date) of the high and low prices of the
Common Stock on the principal national securities exchange on which the Common
Stock is traded, if the Common Stock is then traded on a national securities
exchange; or
(b) The last reported sale price (on that date) of the Common
Stock on the NASDAQ National Market List, if the Common Stock is not then traded
on a national securities exchange; or
(c) The closing bid price (or average of bid prices) last quoted
on such date by an established quotation service for over-the-counter
securities, if the Common Stock is not reported on the NASDAQ National Market
list.
5.2.2 If the Common Stock is not publicly traded at the time an Option
is granted hereunder, fair market value shall be deemed to be the fair value of
the Common Stock as determined by the Committee after taking into consideration
all factors that it deems appropriate, including, without limitation, recent
sale and offer prices of the Common Stock in private transactions negotiated at
arm's length.
5.3 No Option shall be granted hereunder during the suspension of this
Plan pursuant to Section 11.1 or after the termination of this Plan pursuant to
Section 11.3, and no Option granted hereunder shall be exercisable after June
__, 2015. Except as expressly provided herein, nothing contained in this Plan
shall require that the terms and conditions of Options granted hereunder be
uniform.
5.4 The Option granted to a person who, on the Date of Grant, is subject
to Section 16 of the Exchange Act shall provide that at least six (6) months
must elapse from the Date of Grant of the Option to the date of disposition, as
defined in Section 424(c) of the Code, of the Common Stock issued upon exercise
of such option.
6. Limitation on Grants of Options.
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In the event that the aggregate fair market value of Common Stock and other
stock with respect to which ISOs granted to an Optionee hereunder or incentive
stock
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options granted to such Optionee under any other plan of the Company or any of
its Affiliates are exercisable for the first time during any calendar year,
exceeds the maximum permitted under Section 422(d) of the Code, then to the
extent of such excess such Options shall be treated as Non-ISOs.
7. Exercise of Option.
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7.1 Subject to any limitations or conditions imposed upon an Option
pursuant to Section 5 above, an Optionee may exercise an Option, or any part
thereof (unless partial exercise is specifically prohibited by the terms of the
Option), by giving written notice thereof to the Company at its principal place
of business.
7.2 The notice described in Section 7.1 shall be accompanied by full
payment of the Option Price to the extent the Option is so exercised, and full
payment of any amounts the Company determines must be withheld for tax purposes
from the Optionee pursuant to the Option. Such payment shall be:
7.2.1 In lawful money of the United States in cash or by check; or
7.2.2 At the discretion of the Committee, through delivery of shares of
Common Stock having a fair market value equal as of the date of the exercise to
the cash exercise price of the Option; or
7.2.3 At the discretion of the Committee, by delivery of the Optionee's
personal recourse note bearing interest payable not less than annually at no
less than 100% of the lowest applicable federal rate, as defined in Section
1274(d) of the Code; or
7.2.4 At the discretion of the Committee, by any combination of
Sections 7.2.1, 7.2.2, or 7.2.3 above.
7.3 As soon as practicable after exercise of an option in accordance with
Sections 7.1 and 7.2 above, the Company shall issue a stock certificate
evidencing the Common Stock with respect to which the Option has been exercised.
Until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of such stock
certificate, no right to vote or receive dividends or any other rights as a
shareholder shall exist with respect to such Common Stock, notwithstanding the
exercise of the Option. No adjustment will be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 10 below.
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8. Transferability of Options.
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8.1 Except as provided otherwise in this Section 8, no Option shall be
transferable or exercisable by any person other than the Optionee to whom such
Option was originally granted.
8.2 If an Optionee to whom an ISO has been granted (an "ISO Optionee")
ceases to be employed by the Company or by any Affiliate of the Company by
reason of such Optionee's death, any ISOs held by such Optionee shall pass to
the person or Persons entitled thereto pursuant to the will of the Optionee or
the applicable laws of descent and distribution (such person or persons are
sometimes herein referred to collectively as the "Qualified Successor" of the
Optionee), and shall be exercisable by the Qualified Successor for a period of
six (6) months following such death.
8.3 In the event a guardian (the "Guardian") is appointed for an ISO
Optionee whose employment is terminated by the Company or by any Affiliate of
the Company by reason of such Optionee's disability, as defined in Section
22(e)(3) of the Code, any ISO held by such Optionee that could have been
exercised immediately prior to such termination of employment shall be
exercisable by the Guardian of such Optionee for a period of twelve (12) months
following the termination of employment of such Optionee.
8.4 If an ISO Optionee who has ceased to be employed by the Company or by
any Affiliate of the Company by reason of such Optionee's disability, as defined
in Section 22(e)(3) of the Code, dies within six (6) months after the
termination of such employment, any ISO held by such Optionee that could have
been exercised immediately prior to his or her death shall pass to the Qualified
Successor of such Optionee, and shall be exercisable by the Qualified Successor
for a period of six (6) months following the termination of employment of such
Optionee.
8.5 In the event that a qualified domestic relations order, as defined by
Section 414(p) of the Code or Title I of the Employee Retirement Income Security
Act or the rules thereunder, mandates the transfer of any Non-ISO that could
have been exercised immediately prior to the issuance of such order, such Non-
ISO shall pass to the person or persons entitled thereto pursuant to the order
("Domestic Relations Successor"), and shall be exercisable by such person or
persons in accordance with the terms thereof. Hereinafter, all references to a
Qualified Successor shall include a Domestic Relations Successor.
8.6 If an Optionee to whom a Non-ISO has been granted dies, any Non-ISO
held by such Optionee shall pass to the person or persons entitled thereto
pursuant to the will of the Optionee or the applicable laws of descent and
distribution, and shall be exercisable by such person or persons in accordance
with the terms thereof.
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8.7 Options held by a Qualified Successor or exercisable by a Guardian
shall, during the period prior to their termination that such Options are held
by the Qualified Successor or exercisable by the Guardian, continue to vest in
accordance with any vesting schedule under Section 5.1.6 to which such Options
are subject.
8.8 In the event that two or more persons constitute the Qualified
Successor or the Guardian of an Optionee, all rights of such Qualified Successor
or such Guardian shall be exercisable, if at all, by the unanimous agreement of
such persons.
8.9 Employment shall be considered as continuing intact during any
military or sick leave or other bona fide leave of absence if the period of such
leave does not exceed ninety (90) days or, if longer, for so long as the
Optionee's right to reemployment with the Company or an Affiliate thereof is
guaranteed either by statute or by contract. If the period of such leave exceeds
ninety (90) days and his or her reemployment is not so guaranteed, then his or
her employment shall be deemed to have terminated on the ninety-first (91st) day
of such leave.
9. Termination of Options.
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To the extent not earlier exercised, an Option shall terminate at the
earliest of the following dates:
9.1 The termination date specified for such Option in the respective
option Agreement;
9.2 With respect to ISOs, six (6) months after the date of termination of
the Optionee's employment with the Company or any Affiliate of the Company by
reason of such Optionee's disability (within the meaning of Section 22(e)(3) of
the Code) or such Optionee's death;
9.3 With respect to ISOs, three (3) months after the date of termination
of the Optionee's employment with the Company or any Affiliate of the Company
for any reason other than disability (within the meaning of Section 22(e)(3) of
the Code) or death;
9.4 The date of any sale, transfer, or hypothecation, or any attempted
sale, transfer or hypothecation, of such Option in violation of Section 8.1
above; or
9.5 The date specified in Section 10.2 below for such termination in the
event of a Terminating Event.
10. Adjustments to Options.
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10.1 In the event of a material alteration in the capital structure of the
Company on account of a recapitalization, stock split, reverse stock split,
stock dividend, or otherwise, then the Committee shall make such adjustments to
this Plan and to the
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Options then outstanding and thereafter granted hereunder as the Committee
determines to be appropriate and equitable under the circumstances, so that the
proportionate interest of each holder of any such Option shall, to the extent
practicable, be maintained as before the occurrence of such event. Such
adjustments may include, without limitation (a) a change in the number or kind
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of shares of stock of the Company covered by such Options, and (b) a change in
the Option Price payable per share; provided, however, that the aggregate Option
Price applicable to the unexercised portion of existing Options shall not be
altered, it being intended that any adjustments made with respect to such
Options shall apply only to the price per share and the number of shares subject
thereto. For purposes of this Section 10.1, neither (i) the issuance of
additional shares of stock of the Company in exchange for adequate consideration
(including services), nor (ii) the conversion of outstanding preferred shares of
the Company into Common Stock shall be deemed material alterations of the
capital structure of the Company. In the event the Committee shall determine
that the nature of a material alteration in the capital structure of the Company
is such that it is not practical or feasible to make appropriate adjustments to
this Plan or to the Options granted hereunder, such event shall be deemed a
Terminating Event as defined in Section 10.2 below.
10.2 Subject to Section 10.3, all Options granted hereunder shall
terminate upon the occurrence of any of the following events ("Terminating
Events"): (a) the dissolution or liquidation of the Company; or (b) a material
change in the capital structure of the Company that is subject to this Section
10.2 by virtue of the last sentence of Section 10.1 above.
10.3 The Committee shall give notice to Optionees not less than thirty
(30) days prior to the consummation of (a) a Terminating Event as defined in
Section 10.2 above; (b) a merger or consolidation of the Company with one or
more corporations as a result of which, immediately following such merger or
consolidation, the shareholders of the Company as a group will hold less than a
majority of the outstanding capital stock of the surviving corporation; or (c)
the sale or other disposition of all or substantially all of the assets of the
Company. Upon the giving of such notice, all Options granted hereunder shall
become immediately exercisable, without regard to any contingent vesting
provision to which such Options may have otherwise been subject.
10.4 All Options granted hereunder shall become immediately exercisable,
without regard to any contingent vesting provision to which such Options may
have otherwise been subject, upon the occurrence of an event whereby any person
or entity, including any "person" as such term is used in Section 13(d)(3) of
the Exchange Act, becomes the "beneficial owner," as defined in the Exchange
Act, of Common Stock representing fifty percent (50%) or more of the combined
voting power of the voting securities of the Company.
10.5 In the event of a reorganization as defined in this Section 10.5 in
which the Company is not the surviving or acquiring company, or in which the
Company is or becomes a wholly-owned subsidiary of another company after the
effective date of
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the reorganization, then the plan or agreement respecting the reorganization
shall include appropriate terms providing for the assumption of each Option
granted hereunder, or the substitution of an option therefor, such that no
"modification" of any such Option occurs under Section 424 of the Code. For
purposes of this Section 10.5, reorganization shall mean any statutory merger,
statutory consolidation, sale of all or substantially all of the assets of the
Company, or sale, pursuant to an agreement with the Company, of securities of
the Company pursuant to which the Company is or becomes a wholly-owned
subsidiary of another corporation after the effective date of the
reorganization.
10.6 The Committee shall have the right to accelerate the date of exercise
of any installment of any option; provided, however, that, without the consent
of the Optionee, with respect to any Option, the Committee shall not accelerate
the date of any installment of any Option granted to an employee as an ISO (and
not previously converted into a Non-ISO pursuant to Section 12 below) if such
acceleration would violate the annual vesting limitation contained in Section
422(d) of the Code, as described in Section 6 above.
10.7 Adjustments and determinations under this Section 10 shall be made by
the Committee (upon the advice of counsel), whose decisions as to what
adjustments or determination shall be made, and the extent thereof, shall be
final, binding, and conclusive.
11. Suspension, Termination and Amendment.
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11.1 Subject to this Section 11, the Board may, at any time, suspend,
terminate or amend the terms of this Plan.
11.2 Except as provided in Section 10 above, the Board may not do any of
the following without obtaining, within twelve (12) months either before or
after the Board's adoption of a resolution authorizing such action, approval by
the affirmative votes of the holders of a majority of the securities of the
Company present, or represented, and entitled to vote at a meeting duly held in
accordance with the applicable laws of Washington State or by the written
consent of the holders of a majority of the securities of the Company entitled
to vote:
11.2.1 Increase the aggregate number of shares which may be issued
hereunder;
11.2.2 Materially modify the requirements as to eligibility for
participation in this Plan, or change the designation of the employees or class
of employees eligible to receive ISOs under this Plan;
11.2.3 Materially increase the benefits accruing to participants under
this Plan; or
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11.2.4 Make any change in the terms of this Plan that would cause the
ISOs granted hereunder to lose their qualification as incentive stock options
under Section 422 of the Code.
11.3 Subject to Section 11.3, this Plan shall terminate on June __, 2005
unless earlier terminated by the Board.
11.4 No amendment to the terms of this Plan shall, without the consent of
the Optionee, alter or impair any rights or obligations under any Option
theretofore granted. Notwithstanding the suspension or termination of this
Plan, this Plan shall remain in effect as to Options granted hereunder prior to
such suspension or termination.
12. Conversion of ISOs Into Non-ISOs.
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At the written request of any ISO Optionee, the Committee may in its
discretion take such actions as may be necessary to convert such Optionee's ISOs
(or any installments or portions of installments thereof) that have not been
exercised on the date of conversion into Non-ISOs at any time prior to the
expiration of such ISOs, regardless of whether the Optionee is an employee of
the Company or of an Affiliate of the Company at the time of such conversion.
Such actions may include, but shall not be limited to, extending the exercise
period or reducing the exercise price of the appropriate installments of such
ISOs. At the time of such conversion, the Committee, with the consent of the
Optionee, may impose such conditions on the exercise of the resulting Non-ISOs
as the Committee in its discretion may determine, provided that such conditions
shall not be inconsistent with this Plan. Nothing in this Plan shall be deemed
to give any Optionee the right to have such Optionee's ISOs converted into Non-
ISOs, and no such conversion shall occur until and unless the Committee takes
appropriate action. The Committee, with the consent of the Optionee, may also
terminate any portion of any ISO that has not been exercised at the time of such
conversion.
13. Conditions Upon Issuance of Shares.
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13.1 Shares shall not be issued pursuant to the exercise of any Option
unless the exercise of such Option and the issuance and delivery of such shares
pursuant thereto shall comply with all relevant provisions of law, including,
without limitation, the Securities Act of 1933, as amended, the Exchange Act,
any applicable state securities law, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares may
then be listed or otherwise traded, and such compliance has been confirmed by
counsel for the Company.
13.2 As a condition to the exercise of any Option, the Company may require
the participant exercising such Option to represent and warrant at the time of
any such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the
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Company, such representations and warranties are required by any relevant
provision of law.
13.3 The Company's inability to obtain authority from any regulatory body
having jurisdiction, which authority the Company's counsel has determined to be
necessary to the lawful issuance and sale of any shares hereunder, shall relieve
the Company of any liability with respect to the failure to issue or sell such
shares.
14. Use of Proceeds.
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Proceeds from the sale of Common Stock pursuant to the exercise of Options
granted hereunder shall constitute general funds of the Company and shall be
used for general corporate purposes.
15. Notices.
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All notices, requests, demands and other communications required or
permitted to be given under this Plan and the Options granted hereunder shall be
in writing and shall be either served personally on the party to whom notice is
to be given (in which case notice shall be deemed to have been duly given on the
date of such service), or mailed to the party to whom notice is to be given, by
first class mail, registered or certified, return receipt requested, postage
prepaid, and addressed to the party at his or its most recent known address, in
which case such notice shall be deemed to have been duly given on the third
(3rd) postal delivery day following the date of such mailing.
16. Financial Statements.
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Upon request, the Company shall make available its annual audited financial
statements and monthly unaudited financial statements (balance sheet and income
statement) for review by Optionees holding currently exercisable Options. Any
such review shall be conducted in the offices of the Company and may be
conditioned upon such Optionees' execution of such confidentiality agreements as
the Company may reasonably require.
17. Miscellaneous Provisions.
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17.1 Optionees shall be under no obligation to exercise Options granted
hereunder.
17.2 Nothing contained in this Plan shall obligate the Company to retain
an Optionee as an employee, officer, director, or consultant for any period, nor
shall this Plan interfere in any way with the right of the Company to reduce
such Optionees compensation.
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17.3 The provisions of this Plan and each Option issued to an Optionee
hereunder shall be binding upon such Optionee, the Qualified Successor or
Guardian of such Optionee, and the heirs, successors, and assigns of such
Optionee.
17.4 Where the context so requires, references herein to the singular
shall include the plural, and vice versa, and references to a particular gender
shall include either or both genders.
18. Effective Date of Plan and Amendments.
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This Plan was initially adopted by the Board of Directors on June 29, 1995
and approved by the shareholders on July 27, 1995.
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