WILD WINGS, INC.
1997 Stock Option Plan
Section 1. Purpose; Definitions.
1.1 Purpose. The purpose of Wild Wings, Inc. (the
"Company") 1997 Stock Option Plan (the "Plan") is to enable
the Company to offer to its key employees, officers,
directors, consultants and sales representatives whose past,
present and/or potential contributions to the Company and
its Subsidiaries have been, are or will be important to the
success of the Company, an opportunity to acquire a
proprietary interest in the Company. The various types of
long-term incentive awards which may be provided under the
Plan will enable the Company to respond to changes in
compensation practices, tax laws, accounting regulations and
the size and diversity of its business.
1.2 Definitions. For purposes of the Plan, the
following terms shall be defined as set forth below:
(a) "Agreement" means the agreement between the
Company and the Holder setting forth the terms and
conditions of an award under the Plan.
(b) "Board" means the Board of Directors of the
Company.
(c) "Code" means the Internal Revenue Code of
1986, as amended from time to time, and any successor
thereto and the regulations promulgated thereunder.
(d) "Committee" means the Stock Option Committee
of the Board or any other committee of the Board, which the
Board may designate to administer the Plan or any portion
thereof. If no Committee is so designated, then all
references in this Plan to "Committee" shall mean the Board.
(e) "Common Stock" means the Common Stock of the
Company, par value $.001 per share.
(f) "Company" means Wild Wings, Inc., a
corporation organized under the laws of the State of Nevada.
(g) "Deferred Stock" means Stock to be received,
under an award made pursuant to Section 9, below, at the end
of a specified deferral period.
(h) "Disability" means disability as determined
under procedures established by the Committee for purposes
of the Plan.
(i) "Effective Date" means the date set forth in
Section 13.1, below.
1
(j) "Fair Market Value", unless otherwise
required by any applicable provision of the Code or any
regulations issued thereunder, means, as of any given date:
(i) if the Common Stock is listed on a national securities
exchange or quoted on the Nasdaq National Market or Nasdaq
SmallCap Market, the last sale price of the Common Stock in
the principal trading market for the Common Stock on the
last trading day preceding the date of grant of an award
hereunder, as reported by the exchange or Nasdaq, as the
case may be; (ii) if the Common Stock is not listed on a
national securities exchange or quoted on the Nasdaq
National Market or Nasdaq SmallCap Market, but is traded in
the over-the-counter market, the closing bid price for the
Common Stock on the last trading day preceding the date of
grant of an award hereunder for which such quotations are
reported by the OTC Bulletin Board or the National Quotation
Bureau, Incorporated or similar publisher of such
quotations; and (iii) if the fair market value of the Common
Stock cannot be determined pursuant to clause (i) or (ii)
above, such price as the Committee shall determine, in good
faith.
(k) "Holder" means a person who has received an
award under the Plan.
(l) "Incentive Stock Option" means any Stock
Option intended to be and designated as an "incentive stock
option" within the meaning of Section 422 of the Code.
(m) "Nonqualified Stock Option" means any Stock
Option that is not an Incentive Stock Option.
(n) "Normal Retirement" means retirement from
active employment with the Company or any Subsidiary on or
after age 65.
(o) "Other Stock-Based Award" means an award
under Section 10, below, that is valued in whole or in part
be reference to, or is otherwise based upon, Stock.
(p) "Parent" means any present or future parent
corporation of the Company, as such term is defined in
Section 424(e) of the Code.
(q) "Plan" means Wild Wings, Inc. 1997 Stock
Option Plan, as hereinafter amended from time to time.
(r) "Restricted Stock"means Stock, received under
an award made pursuant to Section 8, below, that is subject
to restrictions under said Section 8.
(s) "SAR Value" means the excess of the Fair
Market Value (on the exercise date) of the number of shares
for which the Stock Appreciation Right is exercised over the
exercise price that the participant would have otherwise had
to pay to exercise the related Stock Option and purchase the
relevant shares.
2
(t) "Stock" means the Common Stock of the
Company, par value $.001 per share.
(u) "Stock Appreciation Right" means the right to
receive from the Company, on surrender of all or part of the
related Stock Option, without a cash payment to the Company,
a number of shares of Common Stock equal to the SAR Value
divided by the exercise price of the Stock Option.
(v) "Stock Option" or "Option" means any option
to purchase shares of Stock which is granted pursuant to the
Plan.
(w) "Stock Reload Option" means any option
granted under Section 6.3, below, as a result of the payment
of the exercise price of a Stock Option and/or the
withholding tax related thereto in the form of Stock owned
by the Holder or the withholding of Stock by the Company.
(x) "Subsidiary" means any present or future
subsidiary corporation of the Company, as such term is
defined in Section 424(f) of the Code.
Section 2. Administration.
2.1 Committee Membership. The Plan shall be
administered by the Board or a Committee. Committee members
shall serve for such terms as the Board may in each case
determine, and shall be subject to removal at any time by
the Board.
2.2 Powers of Committee. The Committee shall have
full authority, subject to Section 4, below, to award,
pursuant to the terms of the Plan: (i) Stock Options, (ii)
Stock Appreciation Rights, (iii) Restricted Stock, (iv)
Deferred Stock, (v) Stock Reload Options and/or (vi) Other
Stock-Based Awards. For purposes of illustration and not of
limitation, the Committee shall have the authority (subject
to the express provisions of this Plan):
(a) to select the officers, key employees,
directors, consultants and sales representatives of the
Company or any Subsidiary to whom Stock Options, Stock
Appreciation Rights, Restricted Stock, Deferred Stock,
Reload Stock Options and/or Other Stock-Based Awards may
from time to time be awarded hereunder.
(b) to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any award
granted hereunder (including, but not limited to, number of
shares, share price, any restrictions or limitations, and
any vesting, exchange, surrender, cancellation,
acceleration, termination, exercise or forfeiture
provisions, as the Committee shall determine);
(c) to determine any specified performance goals
or such other factors or criteria which need to be attained
for the vesting of an award granted hereunder;
3
(d) to determine the terms and conditions under
which awards granted hereunder are to operate on a tandem
basis and/or in conjunction with or apart from other equity
awarded under this Plan and cash awards made by the Company
or any Subsidiary outside of this Plan;
(e) to permit a Holder to elect to defer a
payment under the Plan under such rules and procedures as
the Committee may establish, including the crediting of
interest on deferred amounts denominated is cash and of
dividend equivalents on deferred amounts denominated in
Stock;
(f) to determine the extent and circumstances
under which Stock and other amounts payable with respect to
an award hereunder shall be deferred which may be either
automatic or at the election of the Holder; and
(g) to substitute (i) new Stock Options for
previously granted Stock Options, which previously granted
Stock Options have higher option exercise prices and/or
contain other less favorable terms, and (ii) new awards of
any other type for previously granted awards of the same
type, which previously granted awards are upon less
favorable terms.
2.3 Interpretation of Plan.
(a) Committee Authority. Subject to Section 4
and 12, below, the Committee shall have the authority to
adopt, alter and repeal such administrative rules,
guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, to interpret the terms
and provisions of the Plan and any award issued under the
Plan (and to determine the form and substance of all
Agreements relating thereto), to the otherwise supervise the
administration of the Plan. Subject to Section 12, below,
all decisions made by the Committee pursuant to the
provisions of the Plan shall be made in the Committee's sole
discretion and shall be final and binding upon all persons,
including the Company, its Subsidiaries and Holders.
(b) Incentive Stock Options. Anything in the
Plan to the contrary notwithstanding, no term or provision
of the Plan relating to Incentive Stock Options (including
but limited to Stock Reload Options or Stock Appreciation
rights granted in conjunction with an Incentive Stock
Option) or any Agreement providing for Incentive Stock
Options shall be interpreted, amended or altered, nor shall
any discretion or authority granted under the Plan be so
exercised, so as to disqualify the Plan under Section 422 of
the Code, or, without the consent of the Holder(s) affected,
to disqualify any Incentive Stock Option under such Section
422.
Section 3. Stock Subject to Plan.
3.1 Number of Shares. The total number of shares of
Common Stock reserved and available for distribution under
the Plan shall be 1,000,000 shares. Share of Stock under
the Plan may consist, in whole or in part, of authorized and
unissued shares or treasury shares. If any shares of Stock
4
that have been granted pursuant to a Stock Option cease to
be subject to a Stock Option, or if any shares of Stock that
are subject to any Stock Appreciation Right, Restricted
Stock, Deferred Stock award, Reload Stock Option or Other
Stock-Based Award granted hereunder are forfeited or any
such award otherwise terminates without a payment being made
to the Holder in the form of Stock, such shares shall again
be available for distribution in connection with future
grants and awards under the Plan. Only net shares issued
upon a stock-for-stock exercise (including stock used for
withholding taxes) shall be counted against the number of
shares available under the Plan.
3.2 Adjustment Upon Changes in Capitalization, Etc.
In the event of any merger, reorganization, consolidation,
recapitalization, dividend (other than a cash dividend),
stock split, reverse stock split, or other change in
corporate structure affecting the Stock, such substitution
or adjustment shall be made in the aggregate number of
shares reserved for issuance under the Plan, in the number
and exercise price of shares subject to outstanding Options,
in the number of shares and Stock Appreciation Right price
relating to Stock Appreciation Rights, and in the number of
shares and Stock Appreciation Right price relating to Stock
Appreciation Rights, and in the number of shares subject to,
and in the related terms of, other outstanding awards
(including but not limited to awards of Restricted Stock,
Deferred Stock, Reload Stock Options and Other Stock-Based
Awards) granted under the Plan as may be determined to be
appropriate by the Committee in order to prevent dilution or
enlargement of rights, provided that the number of shares
subject to any award shall always be a whole number.
Section 4. Eligibility.
Awards may be made or granted to key employees,
officers, directors, consultants and sales representatives
who are deemed to have rendered or to be able to render
significant services to the Company or its Subsidiaries and
who are deemed to have contributed or to have the potential
to contribute to the success of the Company. No Incentive
Stock Option shall be granted to any person who is not an
employee of the Company or a Subsidiary at the time of
grant.
Section 5. Required Six-Month Holding Period.
Any equity security issued under this Plan may not be
sold prior to six months from the date of the grant of the
related award without the approval of the Company.
Section 6. Stock Options.
6.1 Grant and Exercise. Stock Options granted under
the Plan may be of two types: (i) Incentive Stock Options
and (ii) Nonqualified Stock Options. Any Stock Option
granted under the Plan shall contain such terms, not
inconsistent with this Plan, or with respect to Incentive
Stock Options, not inconsistent with the Code, as the
Committee may from time to time approve. The Committee
shall have the authority to grant Incentive Stock Options,
Non-Qualified Stock Options, or both types of Stock Options
5
and which may be granted alone or in addition to other
awards granted under the Plan. To the extent that any Stock
Option intended to qualify as an Incentive Stock Option does
not so qualify, it shall constitute a separate Nonqualified
Stock Option. An Incentive Stock Option may be granted only
within the ten-year period commencing from the Effective
Date and may only be exercised within ten years of the date
of grant or five years in the case of an Incentive Stock
Option granted to an optionee ("10% Stockholder") who, at
the time of grant, owns Stock possessing more than 10% of
the total combined voting power of all classes of stock of
the Company.
6.2 Terms and Conditions. Stock Options granted under
the Plan shall be subject to the following terms and
conditions:
(a) Exercise Price. The exercise price per share
of Stock purchasable under a Stock Option shall be
determined by the Committee at the time of grant and may not
be less than 100% of the Fair Market Value of the Stock as
defined above; provided, however, that the exercise price of
an Incentive Stock Option granted to a 10% Stockholder shall
not be less than 110% of the Fair Market Value of the Stock.
(b) Option Term. Subject to the limitations in
Section 6.1, above, the term of each Stock Option shall be
fixed by the Committee.
(c) Exercisability. Stock Options shall be
exercisable at such time or times and subject to such terms
and conditions as shall be determined by the Committee and
as set forth in Section 11, below. If the Committee
provides, in its discretion, that any Stock Option is
exercisable only in installments, i.e., that it vests over
time, the Committee may waive such installment exercise
provisions at any time at or after the time of grant in
whole or in part, based upon such factors as the Committee
shall determine.
(d) Method of Exercise. Subject to whatever
installment, exercise and waiting period provisions are
applicable in a particular case, Stock Options may be
exercised in whole or in part at any time during the term of
the Option, by giving written notice of exercise to the
Company specifying the number of shares of Stock to be
purchased. Such notice shall be accompanied by payment in
full of the purchase price, which shall be in cash or,
unless otherwise provided in the Agreement, in shares of
Stock (including Restricted Stock and other contingent
awards under this Plan) or, partly in cash and partly in
such Stock, or such other means which the Committee
determines are consistent with the Plan's purpose and
applicable law. Cash payments shall be made by wire
transfer, certified or bank check or personal check, in each
case payable to the order of the Company; provided, however,
that the Company shall not be required to deliver
certificates for shares of Stock with respect to which an
Option is exercised until the Company has confirmed the
receipt of good and available funds in payment of the
purchase price thereof. Payments in the form of Stock shall
be valued at the Fair Market Value of a share of Stock on
the date prior to the date of exercise. Such payments shall
be made by delivery of stock certificates in negotiable form
which are effective to transfer good and valid title thereto
to the Company, free of any liens or encumbrances. Subject
to the terms of the Agreement, the Committee may, in its
sole discretion, at the request of the Holder, deliver upon
the exercise of a Nonqualified Stock Option a combination of
shares of Deferred Stock and Common Stock; provided that,
notwithstanding the provision of Section 9 of the Plan, such
6
Deferred Stock shall be fully vested and not subject to
forfeiture. A Holder shall have none of the rights of a
stockholder with respect to the shares subject to the Option
until such shares shall be transferred to the Holder upon
the exercise of the Option.
(e) Transferability. No Stock Option shall be
transferable by the Holder other than by will or by the laws
of descent and distribution, and all Stock Options shall be
exercisable, during the Holder's lifetime, only by the
Holder.
(f) Termination by Reason of Death. If a
Holders' employment by the Company or a Subsidiary
terminates by reason of death, any Stock Option held by such
Holder, unless otherwise determined by the Committee at the
time of grant and set forth in the Agreement, shall be fully
vested and may thereafter be exercised by the legal
representative of the estate or by the legatee of the
Holder under the will of the Holder, for a period of one
year (or such other greater or lesser period as the
Committee may specify at grant) from the date of such death
or until the expiration of the stated term of such Stock
Option, which ever period is the shorter.
(g) Termination by Reason of Disability. If a
Holder's employment by the Company or any Subsidiary
terminates by reason of Disability, any Stock Option held by
such Holder, unless otherwise determined by the Committee at
the time of grant and set forth in the Agreement, shall be
fully vested and may thereafter be exercised by the Holder
for a period of one year (or such other greater or lesser
period as the Committee may specify at the time of grant)
from the date of such termination of employment or until the
expiration of the stated term of such Stock Option,
whichever period is the shorter.
(h) Other Termination. Subject to the provisions
of Section 14.3, below, and unless otherwise determined by
the Committee at the time of grant and set forth in the
Agreement, if a Holder is an employee of the Company or a
Subsidiary at the time of grant and if such Holder's
employment by the Company or any Subsidiary terminates for
any reason other than death or Disability, the Stock Option
shall thereupon automatically terminate, except that if the
Holder's employment is terminated by the Company or a
Subsidiary without cause or due to Normal Retirement, then
the portion of such Stock Option which has vested on the
date of termination of employment may be exercised for the
lesser of three months after termination of employment or
the balance of such Stock Option's term.
(i) Additional Incentive Stock Option Limitation.
In the case of an Incentive Stock Option, the aggregate Fair
Market Value of Stock (determined at the time of grant of
the Option) with respect to which Incentive Stock Options
become exercisable by a Holder during any calendar year
(under all such plans of the Company and its Parent and
Subsidiary) shall not exceed $100,000.
(j) Buyout and Settlement Provisions. The
Committee may at any time, in its sole discretion, offer to
buy out a Stock Option previously granted, based upon such
terms and conditions as the Committee shall establish and
communicate to the Holder at the time that such offer is
made.
7
(k) Stock Option Agreement. Each grant of a
Stock Option shall be confirmed by and shall be subject to
the terms of, the Agreement executed by the Company and the
Holder.
6.3 Stock Reload Option. The Committee may also grant
to the Holder (concurrently with the grant of an Incentive
Stock Option and at or after the time of grant in the case
of a Nonqualified Stock Option) a Stock Reload Option up to
the amount of shares of Stock held by the Holder for at
least six months and used to pay all or part of the exercise
price of an Option and, if any, withheld by the Company as
payment for withholding taxes. Such Stock Reload Option
shall have an exercise price equal to the Fair Market Value
as of the date of the Stock Reload Option grant. Unless the
Committee determines otherwise, a Stock Reload Option may be
exercised commencing one year after it is granted and shall
expire on the date of expiration of the Option to which the
Reload Option is related.
Section 7. Stock Appreciation Rights.
7.1 Grant and Exercise. The Committee may grant Stock
Appreciation Rights to participants who have been, or are
being granted, Options under the Plan as a means of allowing
such participants to exercise their Options without the need
to pay the exercise price in cash. In the case of a
Nonqualified Stock Option, a Stock Appreciation Right may be
granted either at or after the time of the grant of such
Nonqualified Stock Option. In the case of an Incentive
Stock Option, a Stock Appreciation Right may be granted only
at the time of the grant of such Incentive Stock Option.
7.2 Terms and Conditions. Stock Appreciation Rights
shall be subject to the following terms and conditions:
(a) Exercisability. Stock Appreciation Rights
shall be exercisable as determined by the Committee and set
forth in the Agreement, subject to the limitations, if any,
imposed by the Code, with respect to related Incentive Stock
Options.
(b) Termination. A Stock Appreciation Right
shall terminate and shall no longer be exercisable upon the
termination or exercise of the related Stock Option.
(c) Method of Exercise. Stock Appreciation
Rights shall be exercisable upon such terms and conditions
as shall be determined by the Committee and set forth in the
Agreement and by surrendering the applicable portion of the
related Stock Option. Upon such exercise and surrender, the
Holder shall be entitled to receive a number of Option
Shares equal to the SAR Value divided by the exercise price
of the Option.
(d) Shares Affected Upon Plan. The granting of a
Stock Appreciation Rights shall not affect the number of
shares of Stock available under for awards under the Plan.
The number of shares available for awards under the Plan
will, however, be reduced by the number of shares of Stock
acquirable upon exercise of the Stock Option to which such
Stock Appreciation right relates.
8
Section 8. Restricted Stock.
8.1 Grant. Shares of Restricted Stock may be awarded
either alone or in addition to other awards granted under
the Plan. The Committee shall determine the eligible
persons to whom, and the time or times at which, grants of
Restricted Stock will be awarded, the number of shares to be
awarded, the price (if any) to be paid by the Holder, the
time or times within which such awards may be subject to
forfeiture (the "Restriction Period"), the vesting schedule
and rights to acceleration thereof, and all other terms and
conditions of the awards.
8.2 Terms and Conditions. Each Restricted Stock award
shall be subject to the following terms and conditions:
(a) Certificates. Restricted Stock, when issued,
will be represented by a stock certificate or certificates
registered in the name of the Holder to whom such Restricted
Stock shall have been awarded. During the Restriction
Period, certificates representing the Restricted Stock and
any securities constituting Retained Distributions (as
defined below) shall bear a legend to the effect that
ownership of the Restricted Stock (and such Retained
Distributions), and the enjoyment of all rights appurtenant
thereto, are subject to the restrictions, terms and
conditions provided in the Plan and the Agreement. Such
certificates shall be deposited by the Holder with the
Company, together with stock powers or other instruments of
assignment, each endorsed in blank, which will permit
transfer to the Company of all or any portion of the
Restricted Stock and any securities constituting Retained
Distributions that shall be forfeited or that shall not
become vested in accordance with the Plan and the Agreement.
(b) Rights of Holder. Restricted Stock shall
constitute issued and outstanding shares of Common Stock for
all corporate purposes. The Holder will have the right to
vote such Restricted Stock, to receive and retain all
regular cash dividends and other cash equivalent
distributions as the Board may in its sole discretion
designate, pay or distribute on such Restricted Stock and to
exercise all other rights, powers and privileges of a holder
of Common Stock with respect to such Restricted Stock, with
the exceptions that (i) the Holder will not be entitled to
delivery of the stock certificate or certificates
representing such Restricted Stock until the Restriction
Period shall have expired and unless all other vest
requirements with respect thereto shall have been fulfilled;
(ii) the Company will retain custody of the stock
certificate or certificates representing the Restricted
Stock during the Restriction Period; (iii) other than
regular cash dividends and other cash equivalent
distributions as the Board may in its sole discretion
designate, pay or distribute, the Company will retain
custody of all distributions ("Retained Distributions") made
or declared with respect to the Restricted Stock (and such
Retained Distributions will be subject to the same
restrictions, terms and conditions as are applicable to the
restricted Stock) until such time, if ever, as the
Restricted Stock with respect to which such Retained
Distributions shall have been made, paid or declared shall
have become vested and with respect to which the Restriction
Period shall have expired; (iv) a breach of any of the
restrictions, terms or conditions contained in this Plan or
9
the Agreement or otherwise established by the Committee with
respect to any Restricted Stock or Retained Distributions
will cause a forfeiture of such Restricted Stock and any
Retained Distributions with respect thereto.
(c) Vesting; Forfeiture. Upon the expiration of
the Restriction Period with respect to each award of
Restricted Stock and the satisfaction of any other
applicable restrictions, terms and conditions (i) all or
part of such Restricted Stock shall become vested in
accordance with the terms of the Agreement, subject to
Section 11, below, and (ii) any Retained Distributions with
respect to such Restricted Stock shall become vested to the
extent that the Restricted Stock related thereto shall have
become vested, subject to Section 11, below. Any such
Restricted Stock and Retained Distributions that do not vest
shall be forfeited to the Company and the Holder shall not
thereafter have any rights with respect to such Restricted
Stock and Retained Distributions that shall have been so
forfeited.
Section 9. Deferred Stock.
9.1 Grant. Shares of Deferred Stock may be awarded
either alone or in addition to other awards granted under
the Plan. The Committee shall determine the eligible
persons to whom and the time or times at which grants of
Deferred Stock shall be awarded, the number of shares of
Deferred Stock to be awarded to any person, the duration of
the period (the "Deferral Period") during which, and the
conditions under which, receipt of the shares will be
deferred, and all the other terms and conditions of the
awards.
9.2 Terms and Conditions. Each Deferred Stock award
shall be subject to the following terms and conditions:
(a) Certificates. At the expiration of the
Deferral Period (or the Additional Deferral Period referred
to in Section 9.2 (d) below, where applicable), shares
certificates shall be issued and delivered to the Holder, or
his legal representative, representing the number equal to
the shares covered by the Deferred Stock award.
(b) Rights of Holder. A person entitled to
receive Deferred stock shall not have any rights of a
stockholder by virtue of such award until the expiration of
the applicable Deferral Period and the issuance and delivery
of the certificates representing such Stock. The shares of
Stock issuable upon expiration of the Deferral Period shall
not be deemed outstanding by the Company until the
expiration of such Deferral period and the issuance and
delivery of such Stock to the Holder.
(c) Vesting; Forfeiture. Upon the expiration of
the Deferral Period with respect to each award of Deferred
Stock and the satisfaction of any other applicable
restrictions, terms and conditions all or part of such
Deferred Stock shall become vested in accordance with the
terms of the Agreement, subject to Section 11, below. Any
such Deferred Stock that does not vest shall be forfeited to
the Company and the Holder shall not thereafter have any
rights with respect to such Deferred Stock.
10
(d) Additional Deferral Period. A Holder may
request to, and the Committee may at any time, defer the
receipt of an award (or an installment of an award) for an
additional specified period or until a specified event (the
"Additional Deferral Period"). Subject to any exceptions
adopted by the Committee, such request must generally be
made at least one year prior to expiration of the Deferral
Period for such Deferred Stock awards (or such installment).
Section 10. Other Stock-Based Awards.
10.1 Grant and Exercise. Other Stock-Based Awards may
be awarded, subject to limitations under applicable law,
that are denominated or payable, in value in whole or in
part by reference to, or otherwise based on, or related to,
shares of Common Stock, as deemed by the Committee to be
consistent with the purposes of the Plan, including, without
limitation, purchase rights, shares of Common Stock awarded
which are not subject to any restrictions or conditions,
convertible or exchangeable debentures, or other rights
convertible into shares of Common Stock and awards valued by
reference to the value of securities of or the performance
of specified subsidiaries. Other Stock-Based Awards may be
awarded either alone or in addition to or in tandem with any
other awards under this Plan or any other plan of the
Company.
10.2 Eligibility for Other Stock-Based Awards. The
Committee shall determine the eligible persons to whom and
the time or times at which grants of such other stock-based
awards shall be made, the number of shares of Common Stock
to be awarded pursuant to such awards, and all other terms
and conditions of the awards.
10.3 Terms and Conditions. Each Other Stock-Based
Award shall be subject to such terms and conditions as may
be determined by the Committee and to Section 11, below.
Section 11. Accelerated Vesting and Exercisability.
If (i) any person or entity other than the Company
and/or any stockholders of the Company as of the Effective
Date acquire securities of the Company (in one or more
transactions) having 25% or more of the total voting power
of all the Company's securities then outstanding and (ii)
the Board of Directors of the Company does not authorize or
otherwise approve such acquisition, then, the vesting
periods of any and all Options and other awards granted and
outstanding under the Plan shall be accelerated and all such
Options and awards will immediately and entirely vest, and
the respective holders thereof will have the immediate right
to purchase and/or receive any and all Stock subject to such
Options and awards on the terms set forth in this Plan and
the respective agreements respecting such Options and
awards.
Section 12. Amendment and Termination.
Subject to Section 4 hereof, the Board may at any time,
and from time to time, amend, alter, suspend or discontinue
11
any of the provisions of the Plan, but no amendment,
alteration, suspension or discontinuance shall be made which
would impair the rights of a Holder under any Agreement
theretofore entered into hereunder, without the Holder's
consent.
Section 13. Term of Plan.
13.1 Effective Date. The Plan shall be effective as of
the date on which the Company's stockholders approved the
Plan ("Effective Date").
13.2 Termination Date. Unless terminated by the Board,
this Plan shall continue to remain effective until such time
no further awards may be granted and all awards granted
under the Plan are no longer outstanding. Notwithstanding
the foregoing, grants of Incentive Stock Options may only be
made during the ten-year period following the Effective
Date.
Section 14. General Provisions.
14.1 Written Agreements. Each award granted under the
Plan shall be confirmed by, and shall be subject to the
terms of the Agreement executed by the Company and the
Holder. The Committee may terminate any award made under
the Plan if the Agreement relating thereto is not executed
and returned to the Company within 10 days after the
Agreement has been delivered to the Holder for his or her
execution.
14.2 Unfunded Status of Plan. The Plan is intended to
constitute an "unfunded" plan for incentive and deferred
compensation. With respect to any payments not yet made to
a Holder by the Company, nothing contained herein shall give
any such Holder any rights that are greater than those of a
general creditor of the Company.
14.3 Employees.
(a) Engaging in Competition With the Company. In
the event a Holder's employment with the Company or a
Subsidiary is terminated for any reason whatsoever, and
within one year after the date thereof such Holder accepts
employment with any competitor of, or otherwise engages in
competition with, the Company, the Committee, in its sole
discretion, may require such Holder to return to the Company
the economic value of any award which was realized or
obtained by such Holder at any time during the period
beginning on that date which is six months prior to the date
of such Holder's termination of employment with the Company.
(b) Termination for Cause. The Committee may, in
the event a Holder's employment with the company or a
Subsidiary is terminated for cause, annul any award granted
under this Plan to return to the Company the economic value
of any award which was realized or obtained by such Holder
at any time during the period beginning on that date which
is six months prior to the date of such Holder's termination
of employment with the Company.
12
(c) No Right of Employment. Nothing contained in
the Plan or in any award hereunder shall be deemed to confer
upon any Holder who is an employee of the Company or any
Subsidiary any right to continued employment with the
Company or any Subsidiary, nor shall it interfere in any way
with the right of the Company or any Subsidiary to terminate
the employment of any Holder who is an employee at any time.
14.4 Investment Representations. The Committee may
require each person acquiring shares of Stock pursuant to a
Stock Option or other award under the Plan to represent to
and agree with the Company in writing that the Holder is
acquiring the shares for investment without a view to
distribution thereof.
14.5 Additional Incentive Arrangements. Nothing
contained in the Plan shall prevent the Board from adopting
such other or additional incentive arrangements as it may
deem desirable, including, but not limited to, the granting
of Stock Options and the awarding of stock and cash
otherwise than under the Plan; and such arrangements may be
either generally applicable or applicable only in specific
cases.
14.6 Withholding Taxes. Not later than the date as of
which an amount must first be included in the gross income
of the Holder for Federal income tax purposes with respect
to any option or other award under the Plan, the Holder
shall pay to the Company, or made arrangements satisfactory
to the Committee regarding the payment of, any Federal,
state and local taxes of any kind required by law to be
withheld or paid with respect to such amount. If permitted
by the Committee, tax withholding or payment obligations may
be settled with Common Stock, including Common Stock that is
part of the award that gives rise to the withholding
requirement. The obligations of the Company under the Plan
shall be conditioned upon such payment or arrangements and
the Company or the Holder's employer (if not the Company)
shall, to the extent permitted by law, have the right to
deduct any such taxes from any payment of any kind
otherwise due to the Holder from the Company or any
Subsidiary.
14.7 Governing Law. The Plan and all awards made and
actions taken thereunder shall be governed by and construed
in accordance with the laws of the State of Nevada (without
regard to choice of law provisions).
14.8 Other Benefit Plans. Any award granted under the
Plan shall not be deemed compensation for purposes of
computing benefits under any retirement plan of the Company
or any Subsidiary and shall not affect any benefits under
any other benefit plan now or subsequently in effect under
which the availability or amount of benefits is related to
the level of compensation (unless required by specific
reference in any such other plan to awards under this Plan).
14.9 Non-Transferability. Except as otherwise
expressly provided in the Plan, no right or benefit under
the Plan may be alienated, sold, assigned, hypothecated,
pledged, exchanged, transferred, encumbranced or charged,
and any attempt to alienate, sell, assign, hypothecate,
pledge, exchange, transfer, encumber or charge the same
shall be void.
13
14.10 Applicable Laws. The obligations of the
Company with respect to all Stock Options and awards under
the Plan shall be subject to (i) all applicable laws, rules
and regulations and such approvals by any governmental
agencies as may be required, including, without limitation,
the Securities Act of 1933, as amended, and (ii) the rules
and regulations of any securities exchange on which the
Stock may be listed.
14.11 Conflicts. If any of the terms or provisions
of the Plan or an Agreement (with respect to Incentive Stock
Options) conflict with the requirements of Section 422 of
the Code, then such terms or provisions shall be deemed
inoperative to the extent they so conflict with the
requirements of said Section 422 of the Code. Additionally,
if this Plan or any Agreement does not contain any provision
required to be included herein under Section 422 of the
Code, such provision shall be deemed to be incorporated
herein and therein with the same force and effect as if such
provision had been set out at length herein and therein. If
any of the terms or provision of any Agreement conflict with
any terms or provision of the Plan, then such terms or
provision shall be deemed inoperative to the extent they so
conflict with the requirements of the Plan. Additionally,
if any Agreement does not contain any provision required to
be included therein under the Plan, such provision shall be
deemed to be incorporated therein with the same force and
effect as if such provision had been set out at length
therein.
14.12 Non-Registered Stock. The shares of Stock to
be distributed under this Plan have not been, as of the
Effective Date, registered under the Securities Act of 1933,
as amended, or any applicable state or foreign securities
laws and the Company has no obligation to any Holder to
register the Stock or to assist the Holder in obtaining an
exemption from the various registration requirements, or to
list the Stock on a national securities exchange.
14