U.S. TRUCKING, INC.
1998 STOCK OPTION PLAN
ARTICLE I
Purpose, Definitions and Effective Date
1.1 Purpose. The purpose of the 1998 Stock Option Plan ("Plan") of U.S.
Trucking, Inc. ("Company") is to promote the success and enhance the value of
the Company by linking the personal interests of Employees of the Company and
any Subsidiary to the interests of the Company's shareholders and by providing
Employees with an additional incentive for outstanding performance. To
achieve this purpose, Options to purchase shares of the Common Stock of the
Company ("Shares") may be granted to Employees of the Company and any
Subsidiary pursuant to the Plan.
1.2 Additional Definitions. In addition to definitions set forth
elsewhere in the Plan, for purposes of the Plan:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Cause" shall mean willful or gross malfeasance or misconduct
on the part of a Participant that is detrimental to the Company or any
Subsidiary as determined by the Committee in its sole discretion, except that
termination of a Participant's employment for "cause" pursuant to any
agreement of employment between the Participant and the Company shall be
conclusive in and of itself and therefore require no determination by the
Committee.
(c) "Committee" shall mean the Stock Option Committee of the Board,
which shall administer the Plan.
(d) "Employee" shall mean any employee or advisor of the Company or
any Subsidiary. Directors and advisors who are not otherwise employed by the
Company or any Subsidiary shall be considered, but solely for purposes of the
Plan, Employees under the Plan and, thus, eligible for Options other than
Incentive Stock Options.
(e) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, or any successor Act thereto and the rules and regulations of the
United States Securities and Exchange Commission thereunder.
(f) "Exercise Price" shall mean the price to be paid for each Share
pursuant to an Option.
(g) "Fair Market Value" shall mean the value of a Share on a
particular date, determined as follows: (i) if the Shares are not listed on
such date on any national securities exchange or on the National Association
of Securities Dealers Automated Quotation System or by the National Quotation
Bureau, Incorporated, the last sales price (or, if none on that date, on the
most recent date on which there was a last sales price) as reported by any
maker, if any, of a market in the Shares or other similar source or service
selected by the Committee; (ii) if the Shares are listed on such date on one
or more national securities exchanges or quotation system or bureau, the last
reported sale price of a Share on such date as recorded on the composite tape
system or, if such system does not cover the Shares, the last reported sale
price of a Share on such date on the principal national securities exchange on
which the Shares are listed or, if no sale of Shares took place on such date,
the last reported sale price of a Share on the most recent day on which a sale
of a Share took place as recorded by such system or on such exchange, as the
case may be; or (iii) if the last sales price of the Shares cannot be
determined in accordance with (i) or (ii), the fair market value of a Share on
such date as determined in good faith by the Committee.
(h) "Incentive Stock Option" shall mean an Option that, in addition
to being subject to applicable terms, conditions and limitations established
by the Committee, complies with Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"). Section 422 provides, among other limitations,
that: (i) to the extent that the aggregate Fair Market Value (determined as of
the time the Option is granted) of Shares subject to the option exercisable
for the first time by a Participant during any calendar year exceeds $100,000
(or such other limit as may be imposed by law) such Option shall not be
treated as an Incentive Stock Option; and (ii) the Option shall be exercisable
for a period of not more than ten (10) years from date of grant. If the
Committee determines to issue Incentive Stock Options but the Plan does not
then conform to the applicable legal requirements, the Plan shall be deemed
amended to so conform as of the date of grant of any Incentive Stock Option.
(i) "Option" shall mean the right to purchase one or more Shares on
the terms and conditions contained in this Plan, the rules of the Committee,
and the terms of an Option Agreement.
(j) "Option Agreement" shall mean the written agreement entered
into between the Company and the Employee upon grant of an Option and which
evidences the terms on which the Option may be exercised consistent with the
Plan.
(k) "Participant" shall mean an Employee who is granted an Option
pursuant to the Plan.
(l) "Restricted Shares" shall mean Shares granted pursuant to
Article IV Stock Options and Voting, designated as being "restricted" by the
Committee and subject to the restrictions and other terms and conditions set
forth in Article IV Stock Options and Voting or imposed by the Committee in
connection with the grant of Options.
(m) "Retirement" shall mean the termination of a Participant's
employment with the Company or any Subsidiary, for reasons other than death,
disability (as that term is used in Section 22(e)(3) of the Code
("Disability")) or for Cause, on or after the date the Participant reaches age
60.
(n) "Subsidiary" shall mean any corporation in which the Company
owns directly, or indirectly through subsidiaries, more than fifty percent
(50%) of the total combined voting power of all classes of stock, or any other
entity (including, but not limited to, partnerships and joint ventures) in
which the Company owns more than fifty percent (50%) of the combined equity
thereof.
1.3 Effective Date. The Plan was approved by the Board and became
effective as of September 9, 1998.
ARTICLE II
Administration
The Plan shall be administered by the Committee. The Committee shall
have full power, except as limited by law or by the Articles of Incorporation
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or Bylaws of the Company, and subject to the provisions of the Plan, to:
select the recipients of Options; determine the number of Shares subject to
each Option under the Plan; determine the sizes of grants of Options under the
Plan; determine the exercise price, duration, vesting requirements, and period
of exercisability of each Option; determine the terms and conditions of such
Option grants in a manner consistent with the Plan; determine whether the
Options are or are not Incentive Stock Options; determine whether or not the
Shares subject to an Option are Restricted Shares; construe and interpret the
Plan and any agreement or instrument entered into under the Plan; establish,
amend, or waive rules and regulations for the Plan's administration; and,
subject to the provisions of Article V Amendment, Modification, and
Termination, herein, amend the terms and conditions of any outstanding Options
to the extent such terms and conditions are within the discretion of the
Committee as provided in the Plan. Further, the Committee shall make all
other determinations which may be necessary or advisable for the
administration of the Plan.
ARTICLE III
Shares Subject to the Plan
3.1 Number of Shares. Subject to adjustment as provided in Section 3.3
Adjustments in Authorized Shares, the total number of Shares for which
Options may be granted under the Plan may not exceed Two Million (2,000,000)
Shares. These Shares may be either authorized but unissued or reacquired
Shares.
3.2 Lapsed Options. If any Option granted under the Plan is canceled,
terminates, expires, or lapses for any reason, any Shares subject to such
Option shall again be available for the grant of an Option under the Plan.
3.3 Adjustments, Merger. In the event of a business combination,
merger, reorganization, consolidation, recapitalization, separation,
liquidation, stock dividend, stock split, share combination, or other change
in the corporate structure of the Company affecting the Shares, such
adjustment shall be made in the number and class of Shares that may be
delivered under the Plan, and in the number and class of and/or price of
Shares subject to outstanding Options granted under the Plan, as may be
determined to be appropriate and equitable by the Committee, in its sole
discretion, to prevent dilution or enlargement of rights; and provided that
the number of Shares subject to any Option shall always be rounded down to the
nearest whole number. If the Company shall at any time merge, consolidate
with or into another corporation or association, or enter into a statutory
share exchange or any other similar business combination transaction in which
Shares are converted into securities and/or other property, each Participant
will thereafter receive, upon the exercise of an Option, the securities or
property to which a holder of the number of Shares then deliverable upon the
exercise of such Option would have been entitled upon the occurrence of such
transaction and the Company shall take such steps in connection with such
transaction as may be necessary to assure that the provisions of this Plan
shall thereafter be applicable, as nearly as is reasonably possible, in
relation to any securities or property thereafter deliverable upon the
exercise of such Option. A sale of all or substantially all the assets of the
Company for a consideration (apart from the assumption of obligations)
consisting primarily of securities shall be deemed a transaction subject to
the foregoing provisions. Notwithstanding the foregoing, if the Company is to
be consolidated with or acquired by another entity in a merger, sale of all or
substantially all of the Company's assets or otherwise, the Company shall have
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the option to (i) upon written notice to the optionees, provide that all
Options must be exercised, to the extent then exercisable, within a specified
number of days of the date of such notice, at the end of which period the
Options shall terminate, or (ii) terminate all Options in exchange for a cash
payment equal to the excess of the fair market value of the shares subject to
such Options (to the extent then exercisable) over the exercise price thereof.
ARTICLE IV
Stock Options and Voting
4.1 Grant of Options. Subject to the terms and provisions of the Plan,
Options may be granted to such Employees, at such times and on such terms and
conditions, as shall be determined by the Committee; provided, however, no
Options may be granted after the 10th anniversary of the effective date of the
Plan, and provided further, that no Incentive Stock Option shall be granted to
any Employee of any Subsidiary if the Subsidiary is not a "subsidiary" as
defined in Section 424(f) of the Code. The Committee shall have discretion in
determining the number of Options and the number of Shares subject to each
Option granted to each Participant. Without limiting the generality of the
foregoing, the Committee shall have the authority to establish guidelines
setting forth anticipated grant levels which correspond to various salary
grades or the equivalent thereof.
4.2 Form of Issuance. Options may be issued in the form of a
certificate or may be recorded on the books and records of the Company for the
account of the Participant. If an Option is not issued in the form of a
certificate, then the Option shall be deemed granted upon issuance of a notice
of the grant addressed to the recipient. The terms and conditions of an
Option shall be set forth in the certificate, in the notice of the issuance of
the grant, or in such other documents as the Committee shall determine. The
Committee shall require a Participant to enter into an Option Agreement (the
written agreement containing the terms and conditions relating to the Option
and its exercise) and to acknowledge receipt of a copy of the Option Agreement
and the Plan.
4.3 Option Price. The Option Price for each grant of an Option shall be
determined by the Committee; provided, however, that the minimum with respect
to Incentive Stock Options shall be one hundred percent (100%) of the Fair
Market Value of a Share on the date as of which the Option is granted.
However, if a Participant owns stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company (including stock
deemed owned under Section 425(d) of the Code), the purchase price per Share
deliverable upon exercise of each Incentive Stock Option shall not be less
than 110% of the Fair Market Value of the Shares on the date of grant.
4.4 Duration of Options. Each Option shall expire at such time as the
Committee shall determine at the time of grant; provided, however, that no
Option shall be exercisable later than the tenth (10th) anniversary date of
its grant. However, if a Participant owns stock possessing more than 10% of
the total combined voting power of all classes of stock of the Company
(including stock deemed owned under Section 425(d) of the Code), the Incentive
Stock Option granted to such Participant shall not be exercisable after the
expiration of five years from the date of Grant.
4.5 Vesting of Options. Options shall become exercisable ("vest") at
such times and under such terms and conditions as determined by the Committee.
The Committee shall have the authority to accelerate the vesting of an Option.
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The Committee, in its sole discretion, may from time to time authorize the
grant of Options with respect to Restricted Shares. Such Options with respect
to Restricted Shares shall be exercisable immediately but the Restricted
Shares issued upon exercise of the Options shall be subject to such
restrictions, including such vesting schedule and other terms and conditions,
as may be established by the Committee. Until the expiration of the
restriction period or the lapse of the restrictions in accordance with the
terms and conditions established by the Committee, the Restricted Shares shall
be subject to the following restrictions and any additional restrictions that
the Committee, in its sole discretion, may from time to time deem desirable in
furtherance of the objectives of the Plan:
(a) The Participant shall not be entitled to receive the
certificate or certificates representing the Restricted Shares.
(b) The Restricted Shares may not be sold, transferred, assigned,
pledged, conveyed, hypothecated or otherwise disposed of.
(c) If the employment of the Participant is terminated for any
reason other than the Retirement, Disability or death of the Participant
before the expiration of the restriction period, the Restricted Shares shall
be forfeited immediately and all rights of the Participant to such Shares
shall terminate immediately without further obligation on the part of the
Company. If the Participant's employment is terminated by reason of the
Retirement, Disability or death of the Participant before the expiration of
the restriction period, the number of Restricted Shares held by the Company
for the Participant's account shall be reduced by the proportion of the
restriction period remaining after the Participant's termination of
employment; the restrictions on the balance of such Restricted Shares shall
lapse on the date the Participant's employment terminated and the certificate
or certificates representing the Shares upon which the restrictions have
lapsed shall be delivered to the Participant or his beneficiary or other
successor in the event of the Participant's death. The Committee, in its sole
discretion, may waive any or all restrictions with respect to Restricted
Shares.
4.6 Exercise of Options. Options granted under the Plan shall be
exercisable at such times and be subject to such restrictions and conditions
as the Committee shall in each instance approve, which need not be the same
for each grant or for each Participant.
4.7 Payment. Payment for Shares purchased upon any exercise of an
Option shall be made in full in cash concurrently with such exercise, except
that, if and to the extent the instrument evidencing the Option so provides
and if the Company is not then prohibited from purchasing or acquiring Shares,
such payment may be made in whole or in part with shares of the same class of
stock as that then subject to the Option, delivered in lieu of cash
concurrently with such exercise, the shares so delivered to be valued on the
basis of the Fair Market Value of the Shares on the day preceding the date of
exercise. If and while payment with Shares is permitted for the exercise of an
Option in accordance with the foregoing provision, the person then entitled to
exercise that Option may, in lieu of using previously outstanding Shares
therefor, use some of the Shares as to which the Option is then being
exercised. Payment of the Option Price by the "delivery" of previously owned
Shares may be made constructively so that the payment Shares are only
hypothetically transferred and only the net number of additional post-payment,
post-exercise Shares is actually issued by the Company.
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4.8 Termination of Employment. Except as may be determined otherwise by
the Committee with respect to individual awards, the following shall apply
with respect to options of employees whose employment is terminated:
(a) Termination by Reason of Death or Disability. If the
employment of a Participant is terminated by reason of death or Disability,
any outstanding Options granted to the Participant shall vest as of the date
of termination of employment and may be exercised, if at all, no more than one
(1) year following termination of employment, unless the Options, by their
terms, expire earlier.
(b) Termination by Retirement. If the employment is terminated by
reason of Retirement, any outstanding Options granted to the Participant that
are vested as of the date of termination of employment may be exercised, if at
all, no more than three (3) years following termination of employment, unless
the Options, by their terms, expire earlier. In the case of Incentive Stock
Options, any Option exercised more than three months after termination of
employment shall lose its status as an Incentive Stock Option.
(c) Termination of Employment for Other Reasons. If the
employment of a Participant shall terminate for any reason other than the
reasons set forth in (a) or (b), above, and other than for Cause, all
outstanding Options granted to the Participant which are vested as of the date
of termination of employment may be exercised by the Participant within the
period beginning on the effective date of termination of employment and ending
three (3) months after such date, unless the Options, by their terms, expire
earlier.
(d) Termination for Cause. If the employment of a Participant
shall terminate for Cause, all outstanding Options held by the Participant
shall immediately terminate and be forfeited to the Company at the date notice
of termination is given.
(e) Options Not Vested at Termination. Any outstanding Options
not vested as of the effective date of termination of employment shall expire
immediately and shall be forfeited to the Company.
4.9 Transfers. For purposes of the Plan, transfer of employment of a
Participant between the Company and any Subsidiary (or between two
Subsidiaries) shall not be deemed a termination of employment.
4.10 Nontransferability of Options. No Option granted pursuant to the
Plan shall be transferable otherwise than by the laws of descent and
distribution and as may be permitted by the Committee with respect to Options
which are not Incentive Stock Options. During the lifetime of a Participant,
the Option shall be exercisable only by the Participant personally (or
permitted transferee) or by the Participant's guardian or legal
representative. If a Participant shall die, the executor or administrator of
the Participant's estate or a transferee of the Option pursuant to a will or
the laws of descent and distribution shall have the right to exercise the
Option in lieu of the Participant.
ARTICLE V
Amendment, Modification, and Termination
5.1 Amendment, Modification, and Termination. The Board may at any time
and from time to time terminate, amend, or modify the Plan. However, no
amendment or modification of the Plan shall be made without the approval of
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the shareholders of the Company if such shareholder approval is required by
the Code, by applicable insider trading rules under Section 16 of the Exchange
Act, by any national securities exchange or system on which the Shares are
then listed or reported, or by a regulatory body having jurisdiction with
respect hereto.
5.2 Awards Previously Granted. No termination, amendment, or
modification of the Plan shall in any material manner adversely affect any
Option previously granted under the Plan without the written consent of the
Participant holding such Option.
ARTICLE VI
Withholding
6.1 Tax Withholding. The Company shall have the power and the right to
deduct or withhold an amount sufficient to satisfy Federal, state and local
taxes required by law to be withheld with respect to any grant, exercise, or
payment made under or as a result of the Plan. At the discretion of the
Committee, a Participant may be permitted to pay to the Company the
withholding amount in the form of cash or previously owned Shares in
accordance with Section 4.7 Payment. If payment of the withholding amount is
made by the delivery of Shares, the value of the Shares delivered shall equal
the Fair Market Value of the Shares on the day preceding the date of exercise
of the Option.
6.2 Share Withholding. With respect to tax withholding required upon
the exercise of Options, a Participant may elect, subject to the approval of
the Committee, to satisfy the withholding requirement, in whole or in part, by
having the Company withhold Shares having a Fair Market Value on the date the
tax is to be determined equal to an amount sufficient to satisfy Federal,
state and local taxes.
ARTICLE VII
Miscellaneous
7.1 Employment. Nothing in the Plan shall interfere with or limit in
any way the right of the Company or any Subsidiary to terminate any
Participant's employment at any time nor confer upon any Participant any right
to continue in the employment of the Company or any Subsidiary.
7.2 Participation. No Employee shall have the right to be selected to
receive an Option under the Plan, or, having been so selected, to receive a
future Option.
7.3 Successors. All obligations of the Company under the Plan shall be
binding on any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase, merger,
consolidation, business combination or otherwise, of all or substantially all
of the business and/or assets of the Company.
7.4 Holding Period. If a Participant shall have the right to require
the Company to repurchase any Shares acquired pursuant to the exercise of an
Option, that right shall be exercised only as to Shares which have been held
for not less than six months.
7.5 Distribution of Stock--Securities Restrictions. The Committee may
require Participants receiving Shares pursuant to any Option under the Plan to
represent to and agree with the Company in writing that the Participant is
acquiring the Shares for investment without a view to distribution thereof.
No Shares shall be issued or transferred pursuant to an Option unless such
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issuance or transfer complies with all relevant provisions of law, including
but not limited to, the (i) limitations, if any, imposed in the state of
issuance or transfer, (ii) restrictions, if any, imposed by the Securities Act
of 1993, as amended, the Exchange Act, and the rules and regulations
promulgated thereunder, and (iii) requirements of any stock exchange upon
which the Shares may then be listed. The certificates for such Shares may
include any legend which the Committee deems appropriate to reflect any
restrictions on transfer.
7.6 Governing Law. The Plan, and any and all agreements hereunder,
shall be construed in accordance with and governed by the internal laws of the
State of Colorado.
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