UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C INFORMATION
INFORMATION STATEMENT PURSUANT TO SECTION 14(c)
OF THE SECURITIES EXCHANGE ACT OF 1934
Check the appropriate box:
[x] Amended Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
[ ] Definitive Information Statement
CIROND CORPORATION
(Name of Registrant As Specified in its Charter)
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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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[ ] Fee paid previously with preliminary materials
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
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CIROND CORPORATION
100D ALBRIGHT WAY, LOS GATOS, CALIFORNIA 95032
INFORMATION STATEMENT
This information statement pursuant to Section 14 of the Securities
Exchange Act of 1934, as amended, and Regulation 14C and Schedule 14C thereunder
(the "INFORMATION STATEMENT") has been mailed on or about August 11, 2006 to the
stockholders of record as of June 30, 2006 (the "RECORD DATE") of Cirond
Corporation, a Nevada corporation (the "COMPANY") in connection with certain
actions to be taken pursuant to the written consents, dated as of July 10, 2006
and July 13, 2006, of the stockholders of the Company holding a majority of the
outstanding shares of common stock.
The actions to be taken pursuant to the written consent shall be
implemented on or about August 31, 2006, at least 20 days after the mailing of
this information statement.
THIS IS NOT A NOTICE OF A SPECIAL MEETING OF STOCKHOLDERS AND NO
STOCKHOLDER MEETING WILL BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN.
By Order of the Board of Directors,
/s/ Francis E. Wilde
Francis E. Wilde
CHIEF EXECUTIVE OFFICER
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
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NOTICE OF ACTIONS TO BE TAKEN PURSUANT TO THE WRITTEN CONSENTS OF
STOCKHOLDERS HOLDING A MAJORITY OF THE OUTSTANDING SHARES OF
COMMON STOCK OF THE COMPANY IN LIEU OF SPECIAL MEETINGS OF
THE STOCKHOLDERS, DATED JULY 10, 2006 AND JULY 13, 2006
To Our Stockholders:
NOTICE IS HEREBY GIVEN that the following actions will be taken
pursuant to the written consents of stockholders holding a majority of the
outstanding shares of common stock dated July 10, 2006 and July 13, 2006, in
lieu of special meetings of the stockholders. Such action will be effected on
or about August 31, 2006:
1. The articles of incorporation of the Company, as amended (the
"ARTICLES OF INCORPORATION"), will be amended and restated to change the
Company's name from "Cirond Corporation" to "Amarium Technologies, Inc.";
2. The Articles of Incorporation will be amended to effect a 1 for 65
reverse stock split, whereby, as of the Record Date, each stockholder shall
receive 1 share for every 65 shares then owned;
3. The Articles of Incorporation will be amended to increase the
authorized shares of common stock from 100,000,000 to 500,000,000;
4. The 2004 Stock Option Plan (the "Plan") will be adopted; and
5. The Plan will be amended to decrease the number of options
authorized for issuance pursuant to the Plan to the greater of 300,000 or
10% of the number of shares of the Company's stock outstanding at the end of
the Company's last completed fiscal quarter and such number shall be
automatically adjusted at the beginning of each fiscal quarter.
OUTSTANDING SHARES AND VOTING RIGHTS
As of the Record Date, the Company's authorized capitalization
consisted of 100,000,000 shares of common stock ("COMMON STOCK"), of which
96,110,000 shares were issued and outstanding, 24,994,000 shares of preferred
stock, none of which were issued and outstanding, and 6,000 shares of Series B
Non-voting 5% Convertible Preferred Stock ("Preferred Stock"), 450 shares of
which were issued and outstanding. Stockholders of the Company have a right to
receive 105,000,000 additional pre-split shares of common stock pursuant to
their conversion of Preferred Stock dated May 9, 2006.
Each share of Common Stock entitles its holder to one vote on each
matter submitted to the stockholders. However, no proxies or consents are being
solicited in connection with the matters described in this Information Statement
because the holders of a majority of the outstanding shares of Common Stock have
already voted in favor of such matters by executing and delivering to the
Company a majority written consent dated July 10, 2006. The shares represented
by the aforementioned written consent constituted sufficient voting power to
approve the matters described in this Information Statement.
Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934, as
amended, the proposals will not be adopted until a date at least 20 days after
the date on which this Information Statement has been mailed to the
stockholders. The Company anticipates that the actions contemplated herein will
be effected on or about the close of business on August 31, 2006.
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The Company has asked brokers and other custodians, nominees and
fiduciaries to forward this Information Statement to the beneficial owners of
the Common Stock held of record by such persons and will reimburse such persons
for out-of-pocket expenses incurred in forwarding such material.
AMENDMENTS TO THE ARTICLES OF INCORPORATION
On June 23, 2006, the board of directors of the Company (the "BOARD OF
DIRECTORS") and on July 10, 2006 and July 13, 2006 the stockholders of the
Company holding a majority of the outstanding shares of common stock of the
Company approved amendments to the Articles of Incorporation and actions:
o To change the Company's name from Cirond Corporation to Amarium
Technologies, Inc.;
o To effect a 1 for 65 reverse stock split, whereby, as of the record
date, each stockholder shall receive 1 share for every 65 shares then
owned;
o To increase the number of authorized common shares to 500,000,000;
o To adopt the 2004 Stock Option Plan; and
o To decrease the number of options authorized for issuance pursuant to
the 2004 Stock Option Plan.
THE CHANGE OF THE COMPANY'S NAME
The amendments to the Articles of Incorporation will change the
Company's name from Cirond Corporation to Amarium Technologies, Inc. The Company
is changing its name as part of its acquisition of the assets of Servgate.
THE REVERSE STOCK SPLIT
The Board of Directors and the stockholders of the Company holding a
majority of the outstanding shares of common stock of the Company have approved
an amendment to the Articles of Incorporation to effect a reverse stock split of
the Company's common stock.
The Company currently has 100,000,000 shares of Common Stock
authorized, and 96,110,000 shares of Common Stock are outstanding as of the
Record Date. By implementing a reverse split on the issued and outstanding
shares of Common Stock, more shares will then be available for issuance in the
future.
The Board of Directors believes that the price of the Common Stock is
too low to attract investors to buy the stock. To proportionally raise the per
share price of the Common Stock by reducing the number of outstanding shares,
the Board of Directors believes that it is in the best interests of the
Company's stockholders to implement a reverse stock split. In addition, the
Board of Directors believes that the share price of the Common Stock is a factor
in whether the Common Stock meets investing guidelines for certain institutional
investors and investment funds. The Board of Directors believes that the
Company's stockholders will benefit from relatively lower trading costs for a
higher priced stock. The combination of lower transaction costs and increased
interest from institutional investors and investment funds may ultimately
improve the trading liquidity of the Common Stock. The Board of Directors is not
implementing the reverse stock split in anticipation of any "going private"
transaction.
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MATERIAL EFFECTS OF THE REVERSE STOCK SPLIT
The reverse stock split will be effected simultaneously for all of the
Common Stock, and the ratio will be the same for all of the Common Stock. The
reverse stock split will affect all of the Company's stockholders uniformly and
will not affect any stockholder's percentage ownership interests in the Company,
except to the extent that the reverse stock split results in fractional share
ownership.
The principal effect of the reverse stock split will be to reduce the
number of shares of the Common Stock issued and outstanding from 96,110,000
shares as of June 30, 2006, to approximately 1,478,615 shares. In addition, the
reverse stock split will increase the number of stockholders who own odd lots
(less than 100 shares). Stockholders who hold odd lots may experience an
increase in the cost of selling their shares and may have greater difficulty in
effecting sales.
EFFECT ON FRACTIONAL STOCKHOLDERS
Stockholders will not receive fractional post-reverse stock split
shares in connection with the reverse stock split. Instead, affected
stockholders will receive a cash payment in an amount equal to $0.03 per
pre-split share which represents the current market price of the Corporation's
common stock specifically calculated as the volume weighted average price from
Bloomberg for the 20 trading days preceding June 23, 2006 (being the date the
Board of Directors approved the Reverse Stock Split). After the reverse stock
split, stockholders will have no further interest in the Company with respect to
any fractional share. The Company currently has approximately 173 record holders
of the Common Stock. The reverse stock split will reduce the number of record
holders of the Common Stock by approximately 76 record holders to approximately
97 record holders.
EFFECT ON REGISTERED AND BENEFICIAL STOCKHOLDERS
Upon the reverse stock split, the Company intends to treat stockholders
holding the Common Stock in "street name," through a bank, broker or other
nominee, in the same manner as registered stockholders whose shares are
registered in their names. Banks, brokers or other nominees will be instructed
to effect the reverse stock split for their beneficial holders holding the
Common Stock in "street name." However, such banks, brokers or other nominees
may have different procedures than registered stockholders for processing the
reverse stock split. Stockholders who hold their shares with such a bank, broker
or other nominee and who have any questions in this regard are encouraged to
contact their nominees.
EFFECT ON REGISTERED CERTIFICATED SHARES
Stockholders whose shares are held in certificate form will receive a
transmittal letter from our Transfer Agent, Signature Stock Transfer, Inc., as
soon as practicable after the effective date of the reverse stock split. The
letter of transmittal will contain instructions on how to surrender
certificate(s) representing pre-reverse stock split shares to the Transfer
Agent. No new shares will be issued until outstanding certificate(s) are
surrendered, together with properly completed and executed letter of
transmittal, to the Transfer Agent. Stockholders should not submit any
certificate(s) until requested to do so.
PROCEDURE FOR EFFECTING REVERSE STOCK SPLIT
The Company will promptly file a Certificate of Amendment to the
Articles of Incorporation with the Secretary of State of the State of Nevada to
amend its existing Articles of Incorporation. The reverse stock split will
become effective as of August 31, 2006, which is referred to as the "effective
date."
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Beginning on the effective date, each certificate representing pre-reverse stock
split shares will be deemed for all corporate purposes to evidence ownership of
post-reverse stock split shares. The text of the Certificate of Amendment is set
forth in APPENDIX A to this Information Statement. The text of the Certificate
of Amendment is subject to modification to include such changes as may be
required by the office of the Secretary of State of the State of Nevada and as
the Board of Directors deems necessary and advisable to effect the reverse stock
split.
CERTAIN RISK FACTORS ASSOCIATED WITH THE REVERSE STOCK SPLIT
Implementation of the reverse stock split entails various risks and
uncertainties, including but not limited to the following:
o There can be no assurance that the market price per share of
the Common Stock after the reverse stock split will remain
unchanged or increase in proportion to the reduction in the
number of shares of the Common Stock outstanding before the
reverse stock split. Accordingly, the total market
capitalization of the Company after the reverse stock split
may be lower than the total market capitalization before the
reverse stock split.
o After the reverse stock split is effected, if the market price
of the Common Stock declines, the percentage decline may be
greater than would occur in the absence of a reverse stock
split.
o There can be no assurance that the reverse stock split will
result in a per share price that will attract institutional
investors or investment funds or that such share price will
satisfy the investing guidelines of institutional investors or
investment funds. As a result, the trading liquidity of the
Common Stock may not necessarily improve.
o The reduced number of shares that would be outstanding after
the reverse stock split could adversely affect the liquidity
of the Common Stock.
AUTHORIZED SHARES
The reverse stock split will affect all issued and outstanding shares
of the Common Stock and outstanding rights to acquire the Common Stock. Upon the
effectiveness of the reverse stock split, the number of authorized shares of the
Common Stock that are not issued or outstanding would increase due to the
reduction in the number of shares of the Common Stock issued and outstanding and
due to the increase in authorized common shares from 100,000,000 to 500,000,000.
The Company currently has 100,000,000 shares of authorized Common Stock and
96,110,000 shares of Common Stock issued and outstanding as of June 30, 2006.
After the Reverse Stock Split and increase in authorized common shares,
500,000,000 common shares will be authorized and approximately 1,478,615 shares
will be outstanding with approximately 1,615,385 shares to be issued.
Approximately 496,906,000 shares will be available for issuance after the
Amendment and Reverse Stock Split. Authorized but unissued shares of Common
Stock will be available for issuance. The Company does not have any plans,
proposals or arrangements to issue any of the newly available authorized shares
of common stock for any purpose, including future acquisitions and/or
financings. The Company will consider issuing shares in the future, but at this
time the Company has no definite plans in this regard. If the Company issues
additional shares of Common Stock, the ownership interest of holders of the
Common Stock will be diluted.
The following table sets forth information regarding the Company's
current and anticipated number of authorized shares and issued and outstanding
shares of the Common Stock following implementation of the reverse stock split
and the reduction in authorized shares.
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SHARES OF SHARES OF
SHARES OF COMMON STOCK COMMON STOCK SHARES OF COMMON
COMMON STOCK ISSUED AND RESERVED FOR STOCK AVAILABLE
AUTHORIZED OUTSTANDING ISSUANCE FOR ISSUANCE
- ---------------------------------------------------------------------------------------------------------------------
As of June 30, 2006 100,000,000 96,110,000 105,000,000 -0-
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After Reverse Stock Split at the Ratio of
1-for-65 and reduction of authorized shares
500,000,000 1,478,615* 1,615,385* 496,906,000*
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* This number is approximate.
ACCOUNTING MATTERS
The reverse stock split will not affect the par value of the Common
Stock. As a result, as of the effective time of the reverse stock split, the
stated capital attributable to the Common Stock on the Company's balance sheet
will be reduced proportionately based on the reverse stock split ratio of
1-for-65, and the additional paid-in capital account will be credited with the
amount by which the stated capital is reduced. The per share net income or loss
and net book value of the Common Stock will be restated because there will be
fewer shares of the Common Stock outstanding.
POTENTIAL ANTI-TAKEOVER EFFECT
Although the increased proportion of unissued authorized shares to
issued shares could, under certain circumstances, have an anti-takeover effect
(for example, by permitting issuances that would dilute the stock ownership of a
person seeking to effect a change in the composition of the Board of Directors
or contemplating a tender offer or other transaction for the combination of the
Company with another company), the reverse stock split proposal is not being
undertaken in response to any effort of which the Board of Directors is aware to
accumulate shares of the Common Stock or obtain control of Company. Other than
the reverse stock split, the Board of Directors does not currently contemplate
the adoption of any other amendments to the Articles of Incorporation that could
be construed to affect the ability of third parties to take over or change the
control of the Company.
Release No. 34-15230 of the staff of the Securities and Exchange
Commission requires disclosure and discussion of the effects of any shareholder
proposal that may be used as an anti-takeover device. However, the purpose of
the reverse split is to raise the per share price of the Common Stock and to
attract potential institutional investors, and not to construct or enable any
anti-takeover defense or mechanism on behalf of the Company. While it is
possible that management could use the additional shares to resist or frustrate
a third-party transaction providing an above-market premium that is favored by a
majority of the independent stockholders, the Company has no intent or plan to
employ the additional unissued authorized shares as an anti-takeover device.
APPRAISAL RIGHTS
Under the Nevada Revised Statutes ("NRS"), a reverse stock split with a
mandatory redemption of fractional shares creates appraisal or dissenters'
rights. Stockholders who oppose the Reverse Stock Split and the right to receive
$0.03 per pre-split share in lieu of receiving a fractional share will have the
right to receive payment for the value of their shares as set forth in NRS
92A.300 ET SEQ. A copy of these sections is attached as APPENDIX B to this
Information Statement. The material requirements for a Stockholder to properly
exercise his or her rights are summarized below. However, these provisions are
very technical in nature, and the following summary is qualified in its entirety
by the actual statutory
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provisions that should be carefully reviewed by any Stockholder wishing to
assert such rights. If you are a Stockholder considering dissenting, you should
consult your own legal advisor.
To exercise dissenters' rights, you must comply with the provisions of
NRS 92A.300 through 92A.500, including the following conditions:
o You must be a Stockholder on the date the Reverse Stock Split is
approved by the Stockholders;
o You must not have executed a written consent in favor of the
Reverse Stock Split;
o You must demand payment in accordance with the terms of a
dissenters' notice, which is attached hereto as APPENDIX C; and
o You must deposit your certificates in accordance with the terms of
the dissenters' notice.
The following is a more detailed description of the conditions you must
satisfy to perfect appraisal or dissenters' rights:
1. MUST BE A STOCKHOLDER ON THE DATE THE REVERSE SPLIT IS APPROVED.
To be entitled to dissenters' rights, you must be the record holder of the
dissenting shares on the date the Reverse Stock Split is approved by the
Stockholders of the Company. If you have a beneficial interest in shares of
Common Stock that are held of record in the name of another person, you must act
promptly to cause the Stockholder of record to follow the steps described below.
2. NO APPROVAL OF THE REVERSE STOCK SPLIT. You must not have executed a
written consent in favor of the approval of the Reverse Stock Split. Execution
of the written consent approving the Reverse Stock Split is a waiver of
dissenters' rights. Failure to have executed a written consent does not
constitute a waiver of dissenters' rights.
3. DEMAND FOR PAYMENT. A dissenters' notice is being delivered as part
of this Information Statement. See Appendix C. The dissenters' notice states
that the Reverse Stock Split was authorized and the effective time or proposed
effective time of the Reverse Stock Split. In addition, the dissenters' notice
provides important instructions you must follow in order to demand alternate
payment for your shares. Specifically, the dissenters' notice sets forth the
following:
o The address to which you must send the payment demand;
o Where and when certificates for shares must be deposited and the
date by which the Company must receive the payment demand;
o A form for demanding payment which will request you to state the
address to which payment is to be made and which includes the date
of the first public announcement of the terms of the Reverse Stock
Split and requires to you certify whether you acquired beneficial
ownership of the shares before that date; and
o A copy of the sections of the Nevada Revised Statutes pertaining
to dissenters' rights.
4. DEPOSIT OF CERTIFICATES. Once you receive the dissenters' notice,
you must deposit your stock certificates in accordance with the terms of the
dissenters' notice. If you do not demand payment or you do not deposit your
certificates as required by the dissenters' notice, you will not be entitled to
a dissenters' right of payment for your shares.
Upon the consummation of the Reverse Stock Split or receipt of the
payment demand, the Company shall pay each Stockholder who has complied with the
requirements set forth above, and who, if the dissenters' notice so requires,
certifies that he acquired beneficial ownership of the shares before the date of
the first public announcement to the news media of the terms of the Reverse
Stock Split, the
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amount that the Company estimates to be the fair value of such shares, plus
accrued interest. The amount that the Board of Directors has determined to be
the fair market value of the shares is $0.03 per pre-split share.
If a Stockholder does not provide certification, as required by the
dissenters' notice, that he acquired beneficial ownership of the shares before
the date of the first public announcement of the terms of the Reverse Stock
Split, the Company may, in lieu of making payment, offer to make payment if the
dissenter agrees to accept such payment in full satisfaction of his demand. The
payment or offer to make payment will be accompanied by the latest available
financial statements of the Company, a statement of the estimate of the fair
value of the respective shares and the amount of interest payable with respect
to such shares, a statement of your rights if you are dissatisfied with the
payment, and a copy of the sections of the Nevada Revised Statutes pertaining to
dissenters' rights.
If you believe that $0.03 per pre-split share paid by the Company is
less than the fair value of your shares or that the interest due is incorrectly
calculated, you may notify the Company of your estimate of the fair value of
your shares and the amount of interest due and demand payment of your estimate,
less any payment previously received. You must notify the Company of your demand
in writing within 30 days after the Company made or offered payment for your
shares. If, within 60 days after receipt by the Company of a demand described in
this paragraph, the demand remains unsettled, the Company shall commence a
proceeding and shall petition the court to determine the fair value of the
shares and accrued interest thereon. If the Company does not bring the
proceeding within such 60-day period, it shall pay each dissenter whose demand
remains unsettled the amount demanded. If the proceeding is brought within the
60-day period, you will be entitled to judgment for the amount by which the
court finds the fair value of your shares plus interest exceeds the amount paid
by the Company.
FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT
The following is a summary of the material federal income tax
consequences of the proposed reverse stock split. This discussion is based on
the Internal Revenue Code, the Treasury Regulations promulgated thereunder,
judicial opinions, published positions of the Internal Revenue Service, and all
other applicable authorities as of the date of this document, all of which are
subject to change (possibly with retroactive effect). This discussion does not
describe all of the tax consequences that may be relevant to a holder in light
of his particular circumstances or to holders subject to special rules (such as
dealers in securities, financial institutions, insurance companies, tax-exempt
organizations, foreign individuals and entities, and persons who acquired their
Common Stock as compensation). In addition, this summary is limited to
stockholders that hold their Common Stock as capital assets. This discussion
also does not address any tax consequences arising under the laws of any state,
local or foreign jurisdiction.
ACCORDINGLY, EACH STOCKHOLDER IS STRONGLY URGED TO CONSULT WITH A TAX
ADVISER TO DETERMINE THE PARTICULAR FEDERAL, STATE, LOCAL OR FOREIGN INCOME OR
OTHER TAX CONSEQUENCES TO SUCH STOCKHOLDER OF THE REVERSE STOCK SPLIT.
Other than the cash payments for fractional shares discussed below, no
gain or loss should be recognized by a stockholder upon such stockholder's
exchange of pre-reverse stock split shares for post-reverse stock split shares
pursuant to the reverse stock split. The aggregate tax basis of the post-reverse
stock split shares received in the reverse stock split (including any fraction
of a post-reverse stock split share deemed to have been received) will be the
same as the stockholder's aggregate tax basis in the pre-reverse stock split
shares exchanged therefore. In general, stockholders who receive cash in
exchange for their fractional share interests in the post-reverse stock split
shares as a result of the reverse stock split
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will recognize gain or loss based on their adjusted basis in the fractional
share interests redeemed. The stockholder's holding period for the post-reverse
stock split shares will include the period during which the stockholder held the
pre-reverse stock split shares surrendered in the reverse stock split.
The receipt of cash instead of a fractional share of the Common Stock
by a United States holder of the Common Stock will result in a taxable gain or
loss to such holder for federal income tax purposes based upon the difference
between the amount of cash received by such holder and the adjusted tax basis in
the fractional shares as set forth above. The gain or loss will constitute a
capital gain or loss and will constitute long-term capital gain or loss if the
holder's holding period is greater than one year as of the effective date.
The tax treatment of each stockholder may vary depending upon the
particular facts and circumstances of such stockholder. Each stockholder is
urged to consult with such stockholder's own tax advisor with respect to the tax
consequences of the reverse stock split. Each stockholder should consult with
his or her own tax advisor with respect to all of the potential tax consequences
to him or her of the reverse stock split.
ADOPTION AND AMENDMENT OF THE 2004 STOCK OPTION PLAN
The Board of Directors recommends approval of a new stock plan to allow
the Company to attract and retain the best available employees and provide an
incentive for employees to use their best efforts on the Company's behalf. For
these reasons, the Board adopted resolutions approving the 2004 Stock Option
Plan (the "Plan", attached as APPENDIX D to this Information Statement) as of
September 20, 2004. The stockholders of the Company holding a majority of the
outstanding shares of common stock of the Company have approved the Plan as of
July 13, 2006 (a copy which may be obtained upon written request to the Company
at the address listed on the front page of this Information Statement). No stock
options have been effectively granted pursuant to the Plan.
DESCRIPTION OF THE PLAN
GENERAL. The purposes of this 2004 Stock Option Plan are to attract and
retain the best available individuals for positions of substantial
responsibility, to provide additional incentive to such individuals, and to
promote the success of the Company's business by aligning the financial
interests of employees and consultants providing personal services to the
Company or its affiliates with long-term shareholder value. Stock options
granted under the Plan may be either "incentive stock options," as defined in
Section 422 of the Internal Revenue Code ("Code") ("ISO"), or non-statutory
options ("NSO").
ADMINISTRATION. The Plan will be administered by the Board of Directors
or the Compensation Committee of the Board (the "Committee"), if one should be
established.
PLAN BENEFITS. Because benefits under the Plan will depend on the
Committee's actions and the fair market value of common stock at various future
dates, it is not possible to determine the benefits that will be received by
officers and other employees.
ELIGIBILITY. ISO may be granted only to employees of the Company or its
subsidiaries. NSO may be granted under the Plan to employees, advisors and
consultants of the Company, its affiliates and subsidiaries, as well as to
persons to whom offers of employment as employees have been granted. The
Committee, in its discretion, will select the individuals to whom options will
be granted, the time or times at which such options are granted, and the number
of shares subject to each grant.
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SHARES SUBJECT TO THE PLAN. The Company may grant optionees, from time
to time, options to purchase an aggregate of up to 5,281,000 or 15% of the
number of shares of the Company's stock outstanding at the end of the Company's
last completed fiscal quarter and such number shall be automatically adjusted at
the beginning of each fiscal quarter.
TERMS AND CONDITIONS OF OPTION GRANTS. Each option is to be evidenced
by an option agreement between the Company and the individual optionee and is
subject to the following additional terms and conditions:
EXERCISE PRICE. The Committee will determine the exercise
price for the shares of common stock underlying each option at the time
the option is granted. The exercise price for shares under an ISO may
not be less than 100% of the fair market value of the common stock at
the time and ISO is granted or less than 85% of the fair market at the
time an NSO is granted. The fair market value price for a share of
Company common stock underlying each option is the closing price per
share on the date the option is granted.
EXERCISE OF OPTION; FORM OF CONSIDERATION. The Committee will
determine when options become exercisable. The means of payment for
shares issued upon exercise of an option will be specified in each
option agreement. The Plan permits payment to be made by cash, check,
and by delivery of other shares of Company stock or by withholding
shares of Option Stock on the exercise date.
VESTING OF OPTION. Each option agreement exercised under the
Plan may specify the period or periods of time within which each option
or portion will become exercisable.
TERM OF OPTION. The term of an option may be no more than ten
(10) years from the date of grant. The term of an ISO option granted to
10% or more stockholder shall not exceed five (5) years from the date
of grant. No option may be exercised after the expiration of its term.
TERMINATION OF OPTION EXERCISE PERIOD. Unless otherwise
expressly provided in any option agreement, the unexercised portion of
any option granted to an optionee shall automatically terminate ninety
(90) days after the date on which the optionee's employment or service
is terminated for any reason, other than by reason of cause or the
optionee's death or disability. Options shall terminate immediately
upon the termination of an optionee's employment for cause or twelve
(12) months after the optionee's death or disability.
NONTRANSFERABILITY OF OPTIONS. Options granted under the Plan
are not transferable other than by will or the laws of descent and
distribution and may be exercised during the optionee's lifetime only
by the optionee, except that a non-statutory stock option may be
transferred to a family member or trust for the benefit of a family
member if the Committee's prior written consent is obtained.
OTHER PROVISIONS. An option agreement may contain other terms,
provisions, and conditions not inconsistent with the Plan, as may be
determined by the Committee.
REDEMPTION OF SHARES BY THE COMPANY. The Company has the right to
redeem any shares issued to any optionee upon exercise of the option granted to
him under the Plan immediately upon the termination of optionee's employment or
service arising from disability, the death of the optionee, the voluntary
termination of employment or services of the optionee, or the termination of
employment or services of the optionee for cause. The redemption price is the
fair market value of the shares on the date of the event of redemption.
10
ADJUSTMENTS AND EXERCISE RIGHTS UPON CHANGES IN CAPITALIZATION, MERGER
OR SALE OF ASSETS. In the event that the Company's stock changes by reason of
any stock split, dividend, combination, reclassification or other similar change
in the Company's capital structure effected without the receipt of
consideration, appropriate adjustments shall be made in the number and class of
shares of stock subject to the Plan, the number and class of shares of stock
subject to any option outstanding under the Plan, and the exercise price for
shares subject to any such outstanding option.
In the event of a sale of all or substantially all of the assets of the
Company, a merger or consolidation or other reorganization in which the Company
is not the surviving entity, the right to exercise all outstanding options will
immediately vest prior to such transaction and will terminate immediately after
such transaction.
AMENDMENT AND TERMINATION OF THE PLAN. The Board may amend, alter,
suspend, or terminate the Plan, or any part thereof, at any time and for any
reason. However, the Company shall obtain shareholder approval for any amendment
to the Plan to the extent necessary and desirable to comply with applicable
laws. No such action by the Board or shareholders may alter or impair any option
previously granted under the Plan without the written consent of the optionee.
The Plan shall remain in effect until terminated by action of the Board or
operation of law.
FEDERAL INCOME TAX CONSEQUENCES RELATING TO THE PLAN
The federal income tax consequences to the Company and its employees of
options granted under the Plan are complex and subject to change. The following
discussion is only a summary of the general rules applicable to the Plan.
Recipients of options granted under the Plan should consult their own tax
advisors since a taxpayer's particular situation may be such that some variation
of the rules described below will apply.
As noted above, options granted under the Plan may be either incentive
stock options ("ISO") or non-statutory stock options ("NSO"). ISO are options
which are designated as such by the Company and which meet certain requirements
under Section 422 of the Code and the related regulations. Any option that does
not satisfy these requirements will be treated as a NSO.
INCENTIVE STOCK OPTIONS. If an option granted under the Stock Plan is
treated as an ISO, the optionee will not recognize any income upon either the
grant or the exercise of the option, and the Company will not be allowed a
deduction for federal tax purposes. Upon a sale of the shares, the tax treatment
to the optionee and the Company will depend primarily upon whether the optionee
has met certain holding period requirements at the time he or she sells the
shares. In addition, as discussed below, the exercise of an ISO may subject the
optionee to alternative minimum tax liability.
If an optionee exercises an ISO and does not dispose of the shares
received within two years after the date such option was granted or within one
year after the transfer of the shares to him or her, any gain realized upon the
disposition will be characterized as long-term capital gain and, in such case,
the Company will not be entitled to a federal tax deduction.
If the optionee disposes of the shares either within two years after
the date the option is granted or within one year after the transfer of the
shares to him or her, such disposition will be treated as a disqualifying
disposition and an amount equal to the lesser of (1) the fair market value of
the shares on the date of exercise minus the exercise price, or (2) the amount
realized on the disposition minus the exercise price, will be taxed as ordinary
income to the optionee in the taxable year in which the disposition occurs.
(However, in the case of gifts, sales to related parties, and certain other
transactions, the full difference between the fair market value of the stock and
the purchase price will be treated as
11
compensation income.) The excess, if any, of the amount realized upon
disposition over the fair market value at the time of the exercise of the option
will be treated as long-term capital gain if the shares have been held for more
than one year following the exercise of the option. In the event of a
disqualifying disposition, the Company may withhold income taxes from the
optionee's compensation with respect to the ordinary income realized by the
optionee as a result of the disqualifying disposition.
The exercise of an ISO may subject an optionee to alternative minimum
tax liability. The excess of the fair market value of the shares at the time an
ISO is exercised over the purchase price of the shares is included in income for
purposes of the alternative minimum tax even though it is not included in
taxable income for purposes of determining the regular tax liability of an
employee. Consequently, an optionee may be obligated to pay alternative minimum
tax in the year he or she exercises an ISO.
In general, there will be no federal income tax deductions allowed to
the Company upon the grant, exercise, or termination of an ISO. However, in the
event an optionee sells or otherwise disposes of stock received on the exercise
of an ISO in a disqualifying disposition, the Company will be entitled to a
deduction for federal income tax purposes in an amount equal to the ordinary
income, if any, recognized by the optionee upon disposition of the shares,
provided that the deduction is not otherwise disallowed under the Code.
NON-STATUTORY STOCK OPTIONS. NSO granted under the Stock Plan do not
qualify as "ISO" and will not qualify for any special tax benefits to the
optionee. An optionee generally will not recognize any taxable income at the
time he or she is granted a nonqualified option. However, upon its exercise, the
optionee will recognize ordinary income for federal income tax purposes measured
by the excess of the then fair market value of the shares over the exercise
price. The income realized by the optionee will be subject to income and other
employee withholding taxes.
The optionee's basis for determination of gain or loss upon the
subsequent disposition of shares acquired upon the exercise of a NSO will be the
amount paid for such shares plus any ordinary income recognized as a result of
the exercise of such option. Upon disposition of any shares acquired pursuant to
the exercise of a NSO, the difference between the sale price and the optionee's
basis in the shares will be treated as a capital gain or loss and generally will
be characterized as long-term capital gain or loss if the shares have been held
for more than one year at their disposition.
In general, there will be no federal income tax deduction allowed to
the Company upon the grant or termination of a NSO or a sale or disposition of
the shares acquired upon the exercise of a NSO. However, upon the exercise of a
NSO, the Company will be entitled to a deduction for federal income tax purposes
equal to the amount of ordinary income that an optionee is required to recognize
as a result of the exercise, provided that the deduction is not otherwise
disallowed under the Code.
AMENDMENT TO PLAN
Upon the implementation of the Reverse Stock Split, the Company will
have fewer options authorized for issuance pursuant to the 2004 Stock Option
Plan (the "Plan"), pursuant to an amendment to the Plan. Section 5(a) of the
Plan will be amended to decrease the number of options authorized for issuance
to the greater of 300,000 or 10% of the number of shares of stock of the
Company's stock outstanding at the end of the Company's last completed fiscal
quarter and such number shall be automatically adjusted at the beginning of each
fiscal quarter. This amendment is made to correlate to the 1 for 65 reverse
stock split and the resulting lower number of shares issued and outstanding.
12
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information, as of June 30,
2006, concerning shares of common stock of the Company, the only class of its
securities that are issued and outstanding, held by (1) each stockholder known
by the Company to own beneficially more than five percent of the common stock,
(2) each director of the Company, (3) each executive officer of the Company, and
(4) all directors and executive officers of the Company as a group:
- -------------------------------------------------------------------------------------------------------------------
PERCENT OF CLASS
NAME AND ADDRESS OF BENEFICIAL AMOUNT AND NATURE OF PERCENT OF CLASS BENEFICIALLY
OWNERS (1)<F1> BENEFICIAL OWNERSHIP FOR VOTE (2)<F2> OWNED (3)<F3>
- -------------------------------------------------------------------------------------------------------------------
Bluegrass Growth Fund LP 6,451,612 6.7% (4)<F4> 9.9% (4)<F4>
122 East 42nd Street Suite 2606
New York, NY 10168
- -------------------------------------------------------------------------------------------------------------------
BSGL LLC 9,000,000 9.4% 4.5%
M Brownrigg
1524 Columbus Ave
Burlington, CA 94010
- -------------------------------------------------------------------------------------------------------------------
Meadowbrook Opportunity Fund LLC 8,064,516 8.4% 12.4%
520 Lake Cook Road Suite 690
Deerfield, IL 60015
- -------------------------------------------------------------------------------------------------------------------
Nicholas R. Miller 7,397,018 7.7% 3.7%
4812 Marine Drive
West Vancouver, BC V7W 292
Canada
- -------------------------------------------------------------------------------------------------------------------
Penn Footwear 4,838,710 5% 7.5%
Line & Grove Streets
PO BOX 87
Nanticoke, PA 18634
- -------------------------------------------------------------------------------------------------------------------
Bradley N. Rotter Self Employed Pension 8,064,516 8.4% 12.4%
Plan and Trust
850 Cornett Avenue Suite 6
San Francisco, CA 94131
- -------------------------------------------------------------------------------------------------------------------
Seaside Holdings Inc. 6,451,614 6.7% 9.9%
4185 Still Creek Drive Suite B101
Burnaby, BC V5C 6C9
Canada
- -------------------------------------------------------------------------------------------------------------------
Stonestreet Limited Partnership 8,064,516 8.4% 12.4%
33 Prince Arthur Avenue
Toronto, ON M5R 1B2
Canada
- -------------------------------------------------------------------------------------------------------------------
Whalehaven Capital Fund LTD 4,838,710 5% 7.5%
PO BOX HM 2257
Hamilton, AMJX
Bermuda
- -------------------------------------------------------------------------------------------------------------------
13
- -------------------------------------------------------------------------------------------------------------------
PERCENT OF CLASS
NAME AND ADDRESS OF BENEFICIAL AMOUNT AND NATURE OF PERCENT OF CLASS BENEFICIALLY
OWNERS (1)<F1> BENEFICIAL OWNERSHIP FOR VOTE (2)<F2> OWNED (3)<F3>
- -------------------------------------------------------------------------------------------------------------------
Francis E. Wilde -0- 0% 0%
- -------------------------------------------------------------------------------------------------------------------
J. Donald Herzog 2,000 0% 0%
- -------------------------------------------------------------------------------------------------------------------
Officers and directors as a group (2 2,000 0% 0%
persons)
- -------------------------------------------------------------------------------------------------------------------
- ------------------
<FN>
(1)<F1> To our knowledge, except as set forth in the footnotes to this table
and subject to applicable community property laws, each person named in
the table has sole voting and investment power with respect to the
shares set forth opposite such person's name.
(2)<F2> This column is based on 96,110,000 shares of Common Stock outstanding
as of June 30, 2006.
(3)<F3> This column is based on 201,110,000 shares of Common Stock beneficially
owned after the issuance of 105,000,000 additional pre-split shares
pursuant to the conversion of Preferred Stock agreed to on May 9, 2006.
(4)<F4> Includes the beneficially owned shares under the name Bluegrass Growth
Fund LTD.
</FN>
CHANGE IN CONTROL ARRANGEMENTS
None.
ADDITIONAL INFORMATION
The Company will provide, by first class mail or other equally prompt
means, a copy of the information that is incorporated by reference in this
Information Statement, without charge, to each person to whom an Information
Statement is delivered upon written or oral request within one day of receipt of
such request. Requests for such information may be directed to Amarium
Technologies, Inc. (formerly Cirond Corporation), Attention: Corporate
Secretary, 100D Albright Way, Los Gatos, California 95032, telephone (408)
385-3555. You are encouraged to review the information filed by the Company with
the Securities and Exchange Commission and other publicly available information.
By Order of the Board of Directors,
/s/ Francis E. Wilde
Francis E. Wilde
CHIEF EXECUTIVE OFFICER
14
APPENDIX A
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
DEAN HELLER
Secretary of State
204 North Carson Street, Suite 1
Carson City, Nevada 89701-4299
(775) 684 5708 Website: secretaryofstate.biz
CERTIFICATE OF AMENDMENT
PURSUANT TO NRS 78.385 and 78.390)
ABOVE SPACE IF FOR OFFICE USE ONLY
CERTIFICATE OF AMENDMENT TO ARTICLES OF INCORPORATION
FOR NEVADA PROFIT CORPORATIONS
(PURSUANT TO NRS 78.385 AND 78.390 - AFTER ISSUANCE OF STOCK)
1. Name of corporation:
Cirond Corporation
2. The articles have been amended as follows (provide article numbers, if
available):
I. NAME: The name of the corporation is Amarium Technologies, Inc.
IV. AUTHORIZATION OF CAPITAL STOCK: The total number of shares of capital stock
the Corporation is authorized to issue is Five Hundred Twenty-Five Million
(525,000,000), which is divided into two classes: (1) Five Hundred Million
(500,000,000) shares of Common Stock, par value $0.001 per share; and (2)
Twenty-Five Million (25,000,000) shares of Preferred Stock, par value $0.001 per
share. The class of preferred stock may be divided into such series as may be
established by the Board of Directors, as provided in sections 78.195, 78.1955
and 78.196 of the Nevada Revised Statutes. The Board of Directors shall have the
authority, by resolution, (1) to divide the Preferred Stock into more than one
class of stock or more than one series of any class; (2) to establish and fix
the distinguishing designation of each such series and the number of shares
thereof, which number, by like action of the Board of Directors, from time to
time thereafter, may be increased, except when otherwise provided by the Board
of Directors in creating such series, or may be decreased, but not below the
number of shares thereof then outstanding; and (3) within the limitations of
applicable law of the State of Nevada or as otherwise set forth in this Article,
to fix and determine the relative voting powers, designations, preferences,
limitations, restrictions and relative rights of the various classes of stock or
series thereof.
3. The vote by which the stockholders holding shares in the corporation
entitling them to exercise at least a majority of the voting power, or such
greater proportion of the voting power as may be required in the case of a vote
by classes or series, or as may be required by the provisions of the * articles
of incorporation have voted in favor of the amendment is: Approved by 50.6% vote
of shareholders
4. Effective date of filing (optional): 8/31/06
(must not be later than 90 days after the certificate is filed)
5. Officer Signature (required):
*If any proposed amendment would alter or change any preference or any relative
or other right given to any class or series of outstanding shares, then the
amendment must be approved by the vote, in addition to the affirmative vote
otherwise required, of the holders of shares representing a majority of the
voting power of each class or series affected by the amendment regardless of
limitations or restrictions on the voting power thereof.
IMPORTANT: Failure to include any of the above information and submit the proper
fees may cause this filing to be rejected.
THIS FORM MUST BE ACCOMPANIED BY APPROPRIATE FEES.
Nevada Secretary of State AM 78.385 Amend 2003
Revised on: 09/29/05
APPENDIX B
NEVADA REVISED STATUTES SECTIONS 92A.300 ET SEQ.
NEVADA REVISED STATUTES
SECTIONS 92A.300 THROUGH 92A.500
RIGHTS OF DISSENTING OWNERS
NRS 92A.300 DEFINITIONS. As used in NRS 92A.300 to 92A.500, inclusive, unless
the context otherwise requires, the words and terms defined in NRS 92A.305 to
92A.335, inclusive, have the meanings ascribed to them in those sections.
(Added to NRS by 1995, 2086)
NRS 92A.305 "BENEFICIAL STOCKHOLDER" DEFINED. "Beneficial stockholder" means a
person who is a beneficial owner of shares held in a voting trust or by a
nominee as the stockholder of record.
(Added to NRS by 1995, 2087)
NRS 92A.310 "CORPORATE ACTION" DEFINED. "Corporate action" means the action of a
domestic corporation.
(Added to NRS by 1995, 2087)
NRS 92A.315 "DISSENTER" DEFINED. "Dissenter" means a stockholder who is entitled
to dissent from a domestic corporation's action under NRS 92A.380 and who
exercises that right when and in the manner required by NRS 92A.400 to 92A.480,
inclusive.
(Added to NRS by 1995, 2087; A 1999, 1631)
NRS 92A.320 "FAIR VALUE" DEFINED. "Fair value," with respect to a dissenter's
shares, means the value of the shares immediately before the effectuation of the
corporate action to which he objects, excluding any appreciation or depreciation
in anticipation of the corporate action unless exclusion would be inequitable.
(Added to NRS by 1995, 2087)
NRS 92A.325 "STOCKHOLDER" DEFINED. "Stockholder" means a stockholder of record
or a beneficial stockholder of a domestic corporation.
(Added to NRS by 1995, 2087)
NRS 92A.330 "STOCKHOLDER OF RECORD" DEFINED. "Stockholder of record" means the
person in whose name shares are registered in the records of a domestic
corporation or the beneficial owner of shares to the extent of the rights
granted by a nominee's certificate on file with the domestic corporation.
(Added to NRS by 1995, 2087)
NRS 92A.335 "SUBJECT CORPORATION" DEFINED. "Subject corporation" means the
domestic corporation which is the issuer of the shares held by a dissenter
before the corporate action creating the dissenter's rights becomes effective or
the surviving or acquiring entity of that issuer after the corporate action
becomes effective.
(Added to NRS by 1995, 2087)
NRS 92A.340 COMPUTATION OF INTEREST. Interest payable pursuant to NRS 92A.300 to
92A.500, inclusive, must be computed from the effective date of the action until
the date of payment, at the average rate currently paid by the entity on its
principal bank loans or, if it has no bank loans, at a rate that is fair and
equitable under all of the circumstances.
(Added to NRS by 1995, 2087)
NRS 92A.350 RIGHTS OF DISSENTING PARTNER OF DOMESTIC LIMITED PARTNERSHIP. A
partnership agreement of a domestic limited partnership or, unless otherwise
provided in the partnership agreement, an agreement of merger or exchange, may
provide that contractual rights with respect to the partnership interest of a
dissenting general or limited partner of a domestic limited partnership are
available for any class or group of partnership interests in connection with any
merger or exchange in which the domestic limited partnership is a constituent
entity.
(Added to NRS by 1995, 2088)
NRS 92A.360 RIGHTS OF DISSENTING MEMBER OF DOMESTIC LIMITED-LIABILITY COMPANY.
The articles of organization or operating agreement of a domestic
limited-liability company or, unless otherwise provided in the articles of
organization or operating agreement, an agreement of merger or exchange, may
provide that contractual rights with
Page 1 of 5
respect to the interest of a dissenting member are available in connection with
any merger or exchange in which the domestic limited-liability company is a
constituent entity.
(Added to NRS by 1995, 2088)
NRS 92A.370 RIGHTS OF DISSENTING MEMBER OF DOMESTIC NONPROFIT CORPORATION.
1. Except as otherwise provided in subsection 2, and unless otherwise
provided in the articles or bylaws, any member of any constituent domestic
nonprofit corporation who voted against the merger may, without prior notice,
but within 30 days after the effective date of the merger, resign from
membership and is thereby excused from all contractual obligations to the
constituent or surviving corporations which did not occur before his resignation
and is thereby entitled to those rights, if any, which would have existed if
there had been no merger and the membership had been terminated or the member
had been expelled.
2. Unless otherwise provided in its articles of incorporation or bylaws,
no member of a domestic nonprofit corporation, including, but not limited to, a
cooperative corporation, which supplies services described in CHAPTER 704 of NRS
to its members only, and no person who is a member of a domestic nonprofit
corporation as a condition of or by reason of the ownership of an interest in
real property, may resign and dissent pursuant to subsection 1.
(Added to NRS by 1995, 2088)
NRS 92A.380 RIGHT OF STOCKHOLDER TO DISSENT FROM CERTAIN CORPORATE ACTIONS AND
TO OBTAIN PAYMENT FOR SHARES.
1. Except as otherwise provided in NRS 92A.370 and 92A.390, any
stockholder is entitled to dissent from, and obtain payment of the fair value of
his shares in the event of any of the following corporate actions:
(a) Consummation of a conversion or plan of merger to which the domestic
corporation is a constituent entity:
(1) If approval by the stockholders is required for the conversion
or merger by NRS 92A.120 to 92A.160, inclusive, or the articles of
incorporation, regardless of whether the stockholder is entitled to vote on the
conversion or plan of merger; or
(2) If the domestic corporation is a subsidiary and is merged with
its parent pursuant to NRS 92A.180.
(b) Consummation of a plan of exchange to which the domestic corporation
is a constituent entity as the corporation whose subject owner's interests will
be acquired, if his shares are to be acquired in the plan of exchange.
(c) Any corporate action taken pursuant to a vote of the stockholders to
the extent that the articles of incorporation, bylaws or a resolution of the
board of directors provides that voting or nonvoting stockholders are entitled
to dissent and obtain payment for their shares.
(d) Any corporate action not described in paragraph (a), (b) or (c) that
will result in the stockholder receiving money or scrip instead of fractional
shares.
2. A stockholder who is entitled to dissent and obtain payment pursuant to
NRS 92A.300 to 92A.500, inclusive, may not challenge the corporate action
creating his entitlement unless the action is unlawful or fraudulent with
respect to him or the domestic corporation.
(Added to NRS by 1995, 2087; A 2001, 1414, 3199; 2003, 3189; 2005, 2204)
NRS 92A.390 LIMITATIONS ON RIGHT OF DISSENT: STOCKHOLDERS OF CERTAIN CLASSES OR
SERIES; ACTION OF STOCKHOLDERS NOT REQUIRED FOR PLAN OF MERGER.
1. There is no right of dissent with respect to a plan of merger or
exchange in favor of stockholders of any class or series which, at the record
date fixed to determine the stockholders entitled to receive notice of and to
vote at the meeting at which the plan of merger or exchange is to be acted on,
were either listed on a national securities exchange, included in the national
market system by the National Association of Securities Dealers, Inc., or held
by at least 2,000 stockholders of record, unless:
(a) The articles of incorporation of the corporation issuing the shares
provide otherwise; or
(b) The holders of the class or series are required under the plan of
merger or exchange to accept for the shares anything except:
(1) Cash, owner's interests or owner's interests and cash in lieu of
fractional owner's interests of:
(I) The surviving or acquiring entity; or
(II) Any other entity which, at the effective date of the plan
of merger or exchange, were either listed on a national securities exchange,
included in the national market system by the National Association of Securities
Dealers, Inc., or held of record by a least 2,000 holders of owner's interests
of record; or
(2) A combination of cash and owner's interests of the kind described
in sub-subparagraphs (I) and (II) of subparagraph (1) of paragraph (b).
Page 2 of 5
2. There is no right of dissent for any holders of stock of the surviving
domestic corporation if the plan of merger does not require action of the
stockholders of the surviving domestic corporation under NRS 92A.130.
(Added to NRS by 1995, 2088)
NRS 92A.400 LIMITATIONS ON RIGHT OF DISSENT: ASSERTION AS TO PORTIONS ONLY TO
SHARES REGISTERED TO STOCKHOLDER; ASSERTION BY BENEFICIAL STOCKHOLDER.
1. A stockholder of record may assert dissenter's rights as to fewer than
all of the shares registered in his name only if he dissents with respect to all
shares beneficially owned by any one person and notifies the subject corporation
in writing of the name and address of each person on whose behalf he asserts
dissenter's rights. The rights of a partial dissenter under this subsection are
determined as if the shares as to which he dissents and his other shares were
registered in the names of different stockholders.
2. A beneficial stockholder may assert dissenter's rights as to shares
held on his behalf only if:
(a) He submits to the subject corporation the written consent of the
stockholder of record to the dissent not later than the time the beneficial
stockholder asserts dissenter's rights; and
(b) He does so with respect to all shares of which he is the beneficial
stockholder or over which he has power to direct the vote.
(Added to NRS by 1995, 2089)
NRS 92A.410 NOTIFICATION OF STOCKHOLDERS REGARDING RIGHT OF DISSENT.
1. If a proposed corporate action creating dissenters' rights is submitted
to a vote at a stockholders' meeting, the notice of the meeting must state that
stockholders are or may be entitled to assert dissenters' rights under NRS
92A.300 to 92A.500, inclusive, and be accompanied by a copy of those sections.
2. If the corporate action creating dissenters' rights is taken by written
consent of the stockholders or without a vote of the stockholders, the domestic
corporation shall notify in writing all stockholders entitled to assert
dissenters' rights that the action was taken and send them the dissenter's
notice described in NRS 92A.430.
(Added to NRS by 1995, 2089; A 1997, 730)
NRS 92A.420 PREREQUISITES TO DEMAND FOR PAYMENT FOR SHARES.
1. If a proposed corporate action creating dissenters' rights is submitted
to a vote at a stockholders' meeting, a stockholder who wishes to assert
dissenter's rights:
(a) Must deliver to the subject corporation, before the vote is taken,
written notice of his intent to demand payment for his shares if the proposed
action is effectuated; and
(b) Must not vote his shares in favor of the proposed action.
2. If a proposed corporate action creating dissenters' rights is taken by
written consent of the stockholders, a stockholder who wishes to assert
dissenters' rights must not consent to or approve the proposed corporate action.
3. A stockholder who does not satisfy the requirements of subsection 1 or
2 and NRS 92A.400 is not entitled to payment for his shares under this chapter.
(Added to NRS by 1995, 2089; A 1999, 1631; 2005, 2204)
NRS 92A.430 DISSENTER'S NOTICE: DELIVERY TO STOCKHOLDERS ENTITLED TO ASSERT
RIGHTS; CONTENTS.
1. The subject corporation shall deliver a written dissenter's notice to
all stockholders entitled to assert dissenters' rights.
2. The dissenter's notice must be sent no later than 10 days after the
effectuation of the corporate action, and must:
(a) State where the demand for payment must be sent and where and when
certificates, if any, for shares must be deposited;
(b) Inform the holders of shares not represented by certificates to what
extent the transfer of the shares will be restricted after the demand for
payment is received;
(c) Supply a form for demanding payment that includes the date of the
first announcement to the news media or to the stockholders of the terms of the
proposed action and requires that the person asserting dissenter's rights
certify whether or not he acquired beneficial ownership of the shares before
that date;
(d) Set a date by which the subject corporation must receive the demand
for payment, which may not be less than 30 nor more than 60 days after the date
the notice is delivered; and
(e) Be accompanied by a copy of NRS 92A.300 to 92A.500, inclusive.
(Added to NRS by 1995, 2089; A 2005, 2205)
Page 3 of 5
NRS 92A.440 DEMAND FOR PAYMENT AND DEPOSIT OF CERTIFICATES; RETENTION OF RIGHTS
OF STOCKHOLDER.
1. A stockholder to whom a dissenter's notice is sent must:
(a) Demand payment;
(b) Certify whether he or the beneficial owner on whose behalf he is
dissenting, as the case may be, acquired beneficial ownership of the shares
before the date required to be set forth in the dissenter's notice for this
certification; and
(c) Deposit his certificates, if any, in accordance with the terms of
the notice.
2. The stockholder who demands payment and deposits his certificates, if
any, before the proposed corporate action is taken retains all other rights of a
stockholder until those rights are cancelled or modified by the taking of the
proposed corporate action.
3. The stockholder who does not demand payment or deposit his certificates
where required, each by the date set forth in the dissenter's notice, is not
entitled to payment for his shares under this chapter.
(Added to NRS by 1995, 2090; A 1997, 730; 2003, 3189)
NRS 92A.450 UNCERTIFICATED SHARES: AUTHORITY TO RESTRICT TRANSFER AFTER DEMAND
FOR PAYMENT; RETENTION OF RIGHTS OF STOCKHOLDER.
1. The subject corporation may restrict the transfer of shares not
represented by a certificate from the date the demand for their payment is
received.
2. The person for whom dissenter's rights are asserted as to shares not
represented by a certificate retains all other rights of a stockholder until
those rights are cancelled or modified by the taking of the proposed corporate
action.
(Added to NRS by 1995, 2090)
NRS 92A.460 PAYMENT FOR SHARES: GENERAL REQUIREMENTS.
1. Except as otherwise provided in NRS 92A.470, within 30 days after
receipt of a demand for payment, the subject corporation shall pay each
dissenter who complied with NRS 92A.440 the amount the subject corporation
estimates to be the fair value of his shares, plus accrued interest. The
obligation of the subject corporation under this subsection may be enforced by
the district court:
(a) Of the county where the corporation's registered office is located; or
(b) At the election of any dissenter residing or having its registered
office in this State, of the county where the dissenter resides or has its
registered office. The court shall dispose of the complaint promptly.
2. The payment must be accompanied by:
(a) The subject corporation's balance sheet as of the end of a fiscal year
ending not more than 16 months before the date of payment, a statement of income
for that year, a statement of changes in the stockholders' equity for that year
and the latest available interim financial statements, if any;
(b) A statement of the subject corporation's estimate of the fair value of
the shares;
(c) An explanation of how the interest was calculated;
(d) A statement of the dissenter's rights to demand payment under
NRS 92A.480; and
(e) A copy of NRS 92A.300 to 92A.500, inclusive.
(Added to NRS by 1995, 2090)
NRS 92A.470 PAYMENT FOR SHARES: SHARES ACQUIRED ON OR AFTER DATE OF DISSENTER'S
NOTICE.
1. A subject corporation may elect to withhold payment from a dissenter
unless he was the beneficial owner of the shares before the date set forth in
the dissenter's notice as the date of the first announcement to the news media
or to the stockholders of the terms of the proposed action.
2. To the extent the subject corporation elects to withhold payment, after
taking the proposed action, it shall estimate the fair value of the shares, plus
accrued interest, and shall offer to pay this amount to each dissenter who
agrees to accept it in full satisfaction of his demand. The subject corporation
shall send with its offer a statement of its estimate of the fair value of the
shares, an explanation of how the interest was calculated, and a statement of
the dissenters' right to demand payment pursuant to NRS 92A.480.
(Added to NRS by 1995, 2091)
NRS 92A.480 DISSENTER'S ESTIMATE OF FAIR VALUE: NOTIFICATION OF SUBJECT
CORPORATION; DEMAND FOR PAYMENT OF ESTIMATE.
1. A dissenter may notify the subject corporation in writing of his own
estimate of the fair value of his shares and the amount of interest due, and
demand payment of his estimate, less any payment pursuant to NRS 92A.460, or
Page 4 of 5
reject the offer pursuant to NRS 92A.470 and demand payment of the fair value of
his shares and interest due, if he believes that the amount paid pursuant to NRS
92A.460 or offered pursuant to NRS 92A.470 is less than the fair value of his
shares or that the interest due is incorrectly calculated.
2. A dissenter waives his right to demand payment pursuant to this section
unless he notifies the subject corporation of his demand in writing within 30
days after the subject corporation made or offered payment for his shares.
(Added to NRS by 1995, 2091)
NRS 92A.490 LEGAL PROCEEDING TO DETERMINE FAIR VALUE: DUTIES OF SUBJECT
CORPORATION; POWERS OF COURT; RIGHTS OF DISSENTER.
1. If a demand for payment remains unsettled, the subject corporation
shall commence a proceeding within 60 days after receiving the demand and
petition the court to determine the fair value of the shares and accrued
interest. If the subject corporation does not commence the proceeding within the
60-day period, it shall pay each dissenter whose demand remains unsettled the
amount demanded.
2. A subject corporation shall commence the proceeding in the district
court of the county where its registered office is located. If the subject
corporation is a foreign entity without a resident agent in the State, it shall
commence the proceeding in the county where the registered office of the
domestic corporation merged with or whose shares were acquired by the foreign
entity was located.
3. The subject corporation shall make all dissenters, whether or not
residents of Nevada, whose demands remain unsettled, parties to the proceeding
as in an action against their shares. All parties must be served with a copy of
the petition. Nonresidents may be served by registered or certified mail or by
publication as provided by law.
4. The jurisdiction of the court in which the proceeding is commenced
under subsection 2 is plenary and exclusive. The court may appoint one or more
persons as appraisers to receive evidence and recommend a decision on the
question of fair value. The appraisers have the powers described in the order
appointing them, or any amendment thereto. The dissenters are entitled to the
same discovery rights as parties in other civil proceedings.
5. Each dissenter who is made a party to the proceeding is entitled to a
judgment:
(a) For the amount, if any, by which the court finds the fair value of his
shares, plus interest, exceeds the amount paid by the subject corporation; or
(b) For the fair value, plus accrued interest, of his after-acquired
shares for which the subject corporation elected to withhold payment pursuant to
NRS 92A.470.
(Added to NRS by 1995, 2091)
NRS 92A.500 LEGAL PROCEEDING TO DETERMINE FAIR VALUE: ASSESSMENT OF COSTS AND
FEES.
1. The court in a proceeding to determine fair value shall determine all
of the costs of the proceeding, including the reasonable compensation and
expenses of any appraisers appointed by the court. The court shall assess the
costs against the subject corporation, except that the court may assess costs
against all or some of the dissenters, in amounts the court finds equitable, to
the extent the court finds the dissenters acted arbitrarily, vexatiously or not
in good faith in demanding payment.
2. The court may also assess the fees and expenses of the counsel and
experts for the respective parties, in amounts the court finds equitable:
(a) Against the subject corporation and in favor of all dissenters if the
court finds the subject corporation did not substantially comply with the
requirements of NRS 92A.300 to 92A.500, inclusive; or
(b) Against either the subject corporation or a dissenter in favor of any
other party, if the court finds that the party against whom the fees and
expenses are assessed acted arbitrarily, vexatiously or not in good faith with
respect to the rights provided by NRS 92A.300 to 92A.500, inclusive.
3. If the court finds that the services of counsel for any dissenter were
of substantial benefit to other dissenters similarly situated, and that the fees
for those services should not be assessed against the subject corporation, the
court may award to those counsel reasonable fees to be paid out of the amounts
awarded to the dissenters who were benefited.
4. In a proceeding commenced pursuant to NRS 92A.460, the court may assess
the costs against the subject corporation, except that the court may assess
costs against all or some of the dissenters who are parties to the proceeding,
in amounts the court finds equitable, to the extent the court finds that such
parties did not act in good faith in instituting the proceeding.
5. This section does not preclude any party in a proceeding commenced
pursuant to NRS 92A.460 or 92A.490 from applying the provisions of N.R.C.P. 68
or NRS 17.115.
(Added to NRS by 1995, 2092)
Page 5 of 5
APPENDIX C
DISSENTERS' NOTICE
NOTICE OF DEMAND FOR PAYMENT AND
DEPOSIT OF CERTIFICATES
Amarium Technologies, Inc. (formerly Cirond Corporation)
c/o Dill Dill Carr Stonbraker & Hutchings, P.C.
455 Sherman Street, Suite 300
Denver, Colorado 80203
Notice is hereby given that the undersigned is the owner of
__________________________ (____________) shares of the common stock, $.001 par
value of Amarium Technologies, Inc. (formerly Cirond Corporation) (the "Common
Stock") and is hereby making a written demand for payment of the fair value of
the aforesaid shares of common stock.
The undersigned hereby tenders and deposits the certificates for the
Common Stock for purposes of processing the same in accordance with Section
92A.440 of the Nevada Revised Statutes.
The address shown below is the address to which payment is to be made.
Sincerely,
----------------------------------------
Signature Date
----------------------------------------
Name
----------------------------------------
Address
----------------------------------------
APPENDIX D
2004 STOCK OPTION PLAN
CIROND CORPORATION
2004 STOCK OPTION PLAN
1. PURPOSE; EFFECTIVENESS OF THE PLAN.
(a) The purpose of this Plan is to advance the interests of the
Company and its stockholders by helping the Company obtain and
retain the services of employees, officers, consultants, and
directors, upon whose judgment, initiative and efforts the
Company is substantially dependent, and to provide those
persons with further incentives to advance the interests of
the Company.
(b) This Plan will become effective on the date of its adoption
by the Board, provided the Plan is approved by the
stockholders of the Company (excluding holders of shares of
Stock issued by the Company pursuant to the exercise of
options granted under this Plan) within twelve months before
or after that date. If the Plan is not so approved by the
stockholders of the Company, any options granted under this
Plan will be rescinded and will be void. This Plan will remain
in effect until it is terminated by the Board or the Committee
(as defined hereafter) under section 9 hereof, except that no
ISO (as defined herein) will be granted after the tenth
anniversary of the date of this Plan's adoption by the Board.
This Plan will be governed by, and construed in accordance
with, the laws of the State of Nevada.
2. CERTAIN DEFINITIONS.
Unless the context otherwise requires, the following defined terms
(together with other capitalized terms defined elsewhere in this Plan)
will govern the construction of this Plan, and of any stock option
agreements entered into pursuant to this Plan:
(a) "10% Stockholder" means a person who owns, either directly or
indirectly by virtue of the ownership attribution provisions
set forth in Section 424(d) of the Code at the time he or she
is granted an Option, stock possessing more than ten percent
(10%) of the total combined voting power or value of all
classes of stock of the Company and/or of its subsidiaries;
(b) "1933 Act" means the federal Securities Act of 1933, as
amended;
(c) "Board" means the Board of Directors of the Company;
(d) "Called for under an Option," or words to similar effect,
means issuable pursuant to the exercise of an Option;
(e) "Code" means the Internal Revenue Code of 1986, as amended
(references herein to Sections of the Code are intended to
refer to Sections of the Code as enacted at the time of this
Plan's adoption by the Board and as subsequently amended, or
to any substantially similar successor provisions of the Code
resulting from recodification, renumbering or otherwise);
(f) "Committee" means a committee of two or more Disinterested
Directors, appointed by the Board, to administer and interpret
this Plan; provided that the term "Committee" will refer to
the Board during such times as no Committee is appointed by
the Board;
(g) "Company" means Cirond Corporation, a Nevada corporation;
(h) "Disability" has the same meaning as "permanent and total
disability," as defined in Section 22(e)(3) of the Code;
(i) "Disinterested Director" means a member of the Board who is
not during the period of one year prior to his or her service
as an administrator of the Plan, or during the period of such
service, granted or awarded Stock, options to acquire Stock,
or similar equity securities of the Company under this Plan or
any similar plan of the Company, other than the grant of a
Formula Option pursuant to section 6(m) of this Plan;
(j) "Eligible Participants" means persons who, at a particular
time, are employees, officers, consultants, or directors of
the Company or its subsidiaries;
(k) "Fair Market Value" means, with respect to the Stock and as of
the date an ISO or a Formula Option is granted hereunder, the
market price per share of such Stock determined by the
Committee, consistent with the requirements of Section 422 of
the Code and to the extent consistent therewith, as follows:
(i) If the Stock was traded on a stock exchange on the
date in question, then the Fair Market Value will be
equal to the closing price reported by the applicable
composite-transactions report for such date;
(ii) If the Stock was traded over-the-counter on the date
in question and was classified as a national market
issue, then the Fair Market Value will be equal to
the last-transaction price quoted by the NASDAQ
system for such date;
(iii) If the Stock was traded over-the-counter on the date
in question but was not classified as a national
market issue, then the Fair Market Value will be
equal to the average of the last reported
representative bid and asked prices quoted by the
NASDAQ system for such date; and
(iv) If none of the foregoing provisions is applicable,
then the Fair Market Value will be determined by the
Committee in good faith on such basis as it deems
appropriate.
(l) "Formula Option" means an NSO granted to members of the
Committee pursuant to section 6(m) hereof;
Cirond Corporation 2004 Stock Option Plan - Page 2
(m) "ISO" has the same meaning as "incentive stock option," as
defined in Section 422 of the Code;
(n) "Just Cause Termination" means a termination by the Company
of an Optionee's employment by and/or service to the Company
(or if the Optionee is a director, removal of the Optionee
from the Board by action of the stockholders or, if permitted
by applicable law and the By-laws of the Company, the other
directors), in connection with the good faith determination of
the Company's board of directors (or of the Company's
stockholders if the Optionee is a director and the removal of
the Optionee from the Board is by action of the stockholders,
but in either case excluding the vote of the Optionee if he or
she is a director or a stockholder) that the Optionee has
engaged in any acts involving dishonesty or moral turpitude or
in any acts that materially and adversely affect the business,
affairs or reputation of the Company or its subsidiaries;
(o) "NSO" means any option granted under this Plan whether
designated by the Committee as a "non-qualified stock option,"
a "non-statutory stock option" or otherwise, other than an
option designated by the Committee as an ISO, or any option so
designated but which, for any reason, fails to qualify as an
ISO pursuant to Section 422 of the Code and the rules and
regulations thereunder;
(p) "Option" means an option granted pursuant to this Plan
entitling the option holder to acquire shares of Stock issued
by the Company pursuant to the valid exercise of the option;
(q) "Option Agreement" means an agreement between the Company and
an Optionee, in form and substance satisfactory to the
Committee in its sole discretion, consistent with this Plan;
(r) "Option Price" with respect to any particular Option means the
exercise price at which the Optionee may acquire each share of
the Option Stock called for under such Option;
(s) "Option Stock" means Stock issued or issuable by the Company
pursuant to the valid exercise of an Option;
(t) "Optionee" means an Eligible Participant to whom Options are
granted hereunder, and any transferee thereof pursuant to a
Transfer authorized under this Plan;
(u) "Plan" means this 2004 Stock Option Plan of the Company;
(v) "QDRO" has the same meaning as "qualified domestic relations
order" as defined in Section 414(p) of the Code;
(w) "Stock" means shares of the Company's Common Stock, $0.001 par
value;
Cirond Corporation 2004 Stock Option Plan - Page 3
(x) "Subsidiary" has the same meaning as "Subsidiary Corporation"
as defined in Section 424(f) of the Code; and
(y) "Transfer," with respect to Option Stock, includes, without
limitation, a voluntary or involuntary sale, assignment,
transfer, conveyance, pledge, hypothecation, encumbrance,
disposal, loan, gift, attachment or levy of such Option Stock,
including without limitation an assignment for the benefit of
creditors of the Optionee, a transfer by operation of law,
such as a transfer by will or under the laws of descent and
distribution, an execution of judgment against the Option
Stock or the acquisition of record or beneficial ownership
thereof by a lender or creditor, a transfer pursuant to a
QDRO, or to any decree of divorce, dissolution or separate
maintenance, any property settlement, any separation agreement
or any other agreement with a spouse (except for estate
planning purposes) under which a part or all of the shares of
Option Stock are transferred or awarded to the spouse of the
Optionee or are required to be sold; or a transfer resulting
from the filing by the Optionee of a petition for relief, or
the filing of an involuntary petition against such Optionee,
under the bankruptcy laws of the United States or of any other
nation.
3. ELIGIBILITY.
The Company may grant Options under this Plan only to persons who are
Eligible Participants as of the time of such grant. Subject to the
provisions of sections 4(d), 5 and 6 hereof, there is no limitation on
the number of Options that may be granted to an Eligible Participant.
4. ADMINISTRATION.
(a) COMMITTEE. The Committee, if appointed by the Board, will
administer this Plan. If the Board, in its discretion, does
not appoint such a Committee, the Board itself will administer
this Plan and take such other actions as the Committee is
authorized to take hereunder; provided that the Board may take
such actions hereunder in the same manner as the Board may
take other actions under the Company's Articles of
Incorporation and By-laws generally.
(b) AUTHORITY AND DISCRETION OF COMMITTEE. The Committee will have
full and final authority in its discretion, at any time and
from time to time, subject only to the express terms,
conditions and other provisions of the Company's Articles of
Incorporation, By-laws and this Plan, and the specific
limitations on such discretion set forth herein:
(i) to select and approve the persons who will be granted
Options under this Plan from among the Eligible
Participants, and to grant to any person so selected
one or more Options to purchase such number of shares
of Option Stock as the Committee may determine;
Cirond Corporation 2004 Stock Option Plan - Page 4
(ii) to determine the period or periods of time during
which Options may be exercised, the Option Price and
the duration of such Options, and other matters to be
determined by the Committee in connection with
specific Option grants and Option Agreements as
specified under this Plan;
(iii) to interpret this Plan, to prescribe, amend and
rescind rules and regulations relating to this Plan,
and to make all other determinations necessary or
advisable for the operation and administration of
this Plan; and
(iv) to delegate all or a portion of its authority under
subsections (i) and (ii) of this section 4(b) to one
or more directors of the Company who are executive
officers of the Company, but only in connection with
Options granted to Eligible Participants who are not
subject to the reporting and liability provisions of
Section 16 of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder,
and subject to such restrictions and limitations
(such as the aggregate number of shares of Option
Stock called for by such Options that may be granted)
as the Committee may decide to impose on such
delegate directors.
(c) LIMITATION ON AUTHORITY. Notwithstanding the foregoing, or any
other provision of this Plan, the Committee will have no
authority:
(i) to grant Options to any of its members, whether or
not approved by the Board; and
(ii) to determine any matters, or exercise any discretion,
in connection with the Formula Options under section
6(m) hereof, to the extent that the power to make
such determinations or to exercise such discretion
would cause one or more members of the Committee no
longer to be "Disinterested Directors" within the
meaning of section 2(i) above.
(d) DESIGNATION OF OPTIONS. Except as otherwise provided herein,
the Committee will designate any Option granted hereunder
either as an ISO or as an NSO. To the extent that the Fair
Market Value (determined at the time the Option is granted) of
Stock with respect to which all ISOs are exercisable for the
first time by any individual during any calendar year
(pursuant to this Plan and all other plans of the Company
and/or its subsidiaries) exceeds $100,000, such option will be
treated as an NSO. Notwithstanding the general eligibility
provisions of section 3 hereof, the Committee may grant ISOs
only to persons who are employees of the Company and/or its
subsidiaries.
(e) OPTION AGREEMENTS. Options will be deemed granted hereunder
only upon the execution and delivery of an Option Agreement by
the Optionee and a duly
Cirond Corporation 2004 Stock Option Plan - Page 5
authorized officer of the Company. Options will not be deemed
granted hereunder merely upon the authorization of such grant
by the Committee.
5. SHARES RESERVED FOR OPTIONS.
(a) OPTION POOL. The aggregate number of shares of Option Stock
that may be issued pursuant to the exercise of Options granted
under this Plan initially will not exceed Five Million Two
Hundred Eighty-One Thousand Five Hundred (5,281,500) (the
"Option Pool"), provided that such number automatically shall
be adjusted quarterly on the beginning of the Company's fiscal
quarter to a number equal to 15% of the number of shares of
Stock of the Company outstanding at the end of the Company's
last completed fiscal quarter, or 5,281,500 shares, whichever
is greater, and provided further that such number will be
increased by the number of shares of Option Stock that the
Company subsequently may reacquire through repurchase or
otherwise. Shares of Option Stock that would have been
issuable pursuant to Options, but that are no longer issuable
because all or part of those Options have terminated or
expired, will be deemed not to have been issued for purposes
of computing the number of shares of Option Stock remaining in
the Option Pool and available for issuance.
(b) ADJUSTMENTS UPON CHANGES IN STOCK. In the event of any change
in the outstanding Stock of the Company as a result of a stock
split, reverse stock split, stock dividend, recapitalization,
combination or reclassification, appropriate proportionate
adjustments will be made in:
(i) the aggregate number of shares of Option Stock in the
Option Pool that may be issued pursuant to the
exercise of Options granted hereunder;
(ii) the Option Price and the number of shares of Option
Stock called for in each outstanding Option granted
hereunder; and
(iii) other rights and matters determined on a per share
basis under this Plan or any Option Agreement
hereunder. Any such adjustments will be made only by
the Board, and when so made will be effective,
conclusive and binding for all purposes with respect
to this Plan and all Options then outstanding. No
such adjustments will be required by reason of the
issuance or sale by the Company for cash or other
consideration of additional shares of its Stock or
securities convertible into or exchangeable for
shares of its Stock.
6. TERMS OF STOCK OPTION AGREEMENTS.
Each Option granted pursuant to this Plan will be evidenced by an
agreement (an "Option Agreement") between the Company and the person to
whom such Option is granted, in form and substance satisfactory to the
Committee in its sole discretion, consistent with this Plan.
Cirond Corporation 2004 Stock Option Plan - Page 6
Without limiting the foregoing, each Option Agreement (unless otherwise
stated therein) will be deemed to include the following terms and
conditions:
(a) COVENANTS OF OPTIONEE. At the discretion of the Committee, the
person to whom an Option is granted hereunder, as a condition
to the granting of the Option, must execute and deliver to the
Company a confidential information agreement approved by the
Committee. Nothing contained in this Plan, any Option
Agreement or in any other agreement executed in connection
with the granting of an Option under this Plan will confer
upon any Optionee any right with respect to the continuation
of his or her status as an employee of, consultant or
independent contractor to, or director of, the Company or its
subsidiaries.
(b) VESTING PERIODS. Except as otherwise provided herein, each
Option Agreement may specify the period or periods of time
within which each Option or portion thereof will first become
exercisable (the "Vesting Period") with respect to the total
number of shares of Option Stock called for thereunder (the
"Total Award Option Stock"). Such Vesting Periods will be
fixed by the Committee in its discretion, and may be
accelerated or shortened by the Committee in its discretion.
Unless the Option Agreement executed by an Optionee expressly
otherwise provides and except as set forth herein, the right
to exercise an Option granted hereunder will be subject to the
following Vesting Periods, subject to the Optionee continuing
to be an Eligible Participant and the occurrence of any other
event (including the passage of time) that would result in the
cancellation or termination of the Option:
(i) no portion of the Option will be exercisable prior to
four (4) months from the Grant Date set forth in the
Option Agreement;
(ii) upon and after the expiration of four (4) months from
the Grant Date, the Optionee may purchase up to
sixteen and two-thirds percent (approximately 16.67%)
of the Total Award Option Stock; and
(iii) the Option will become exercisable on a cumulative
basis as to sixteen and two-thirds percent
(approximately 16.67%) of the Total Award Option
Stock, at the end of every period of four (4) months
that elapses after such first four-month period, so
that the Option will have become fully exercisable,
subject to the Optionee's remaining an Eligible
Participant, on the second anniversary of such Grant
Date; and
(iv) such additional vesting periods as may be determined
by the Committee in its sole discretion.
(c) EXERCISE OF THE OPTION.
Cirond Corporation 2004 Stock Option Plan - Page 7
(i) MECHANICS AND NOTICE. An Option may be exercised to
the extent exercisable (1) by giving written notice
of exercise to the Company, specifying the number of
full shares of Option Stock to be purchased and
accompanied by full payment of the Option Price
thereof and the amount of withholding taxes pursuant
to subsection 6(c)(ii) below; and (2) by giving
assurances satisfactory to the Company that the
shares of Option Stock to be purchased upon such
exercise are being purchased for investment and not
with a view to resale in connection with any
distribution of such shares in violation of the 1933
Act; provided, however, that in the event the Option
Stock called for under the Option is registered under
the 1933 Act, or in the event resale of such Option
Stock without such registration would otherwise be
permissible, this second condition will be
inoperative if, in the opinion of counsel for the
Company, such condition is not required under the
1933 Act, or any other applicable law, regulation or
rule of any governmental agency.
(ii) WITHHOLDING TAXES. As a condition to the issuance of
the shares of Option Stock upon full or partial
exercise of an NSO granted under this Plan, the
Optionee will pay to the Company in cash, or in such
other form as the Committee may determine in its
discretion, the amount of the Company's tax
withholding liability required in connection with
such exercise. For purposes of this subsection
6(c)(ii), "tax withholding liability" will mean all
federal and state income taxes, social security tax,
and any other taxes applicable to the compensation
income arising from the transaction required by
applicable law to be withheld by the Company.
(d) PAYMENT OF OPTION PRICE. Each Option Agreement will specify
the Option Price with respect to the exercise of Option Stock
thereunder, to be fixed by the Committee in its discretion,
but in no event will the Option Price for an ISO granted
hereunder be less than the Fair Market Value (or, in case the
Optionee is a 10% Stockholder, one hundred ten percent (110%)
of such Fair Market Value) of the Option Stock at the time
such ISO is granted, and in no event will the Option Price for
an NSO granted hereunder be less than eighty-five percent
(85%) of Fair Market Value. The Option Price will be payable
to the Company in United States dollars in cash or by check
or, such other legal consideration as may be approved by the
Committee, in its discretion.
(i) For example, the Committee, in its discretion, may
permit a particular Optionee to pay all or a portion
of the Option Price, and/or the tax withholding
liability set forth in subsection 6(c)(ii) above,
with respect to the exercise of an Option either by
surrendering shares of Stock already owned by such
Optionee or by withholding shares of Option Stock,
provided that the Committee determines that the fair
market value of such surrendered Stock or withheld
Option Stock is equal to the corresponding portion of
such Option Price and/or tax withholding liability,
as the case may be, to be paid for therewith.
Cirond Corporation 2004 Stock Option Plan - Page 8
(ii) If the Committee permits an Optionee to pay any
portion of the Option Price and/or tax withholding
liability with shares of Stock with respect to the
exercise of an Option (the "Underlying Option") as
provided in subsection 6(d)(i) above, then the
Committee, in its discretion, may grant to such
Optionee (but only if Optionee remains an Eligible
Participant at that time) additional NSOs, the number
of shares of Option Stock called for thereunder to be
equal to all or a portion of the Stock so surrendered
or withheld (a "Replacement Option"). Each
Replacement Option will be evidenced by an Option
Agreement. Unless otherwise set forth therein, each
Replacement Option will be immediately exercisable
upon such grant (without any Vesting Period) and will
be coterminous with the Underlying Option. The
Committee, in its sole discretion, may establish such
other terms and conditions for Replacement Options as
it deems appropriate.
(e) TERMINATION OF THE OPTION. Except as otherwise provided
herein, each Option Agreement will specify the period of time,
to be fixed by the Committee in its discretion, during which
the Option granted therein will be exercisable, not to exceed
ten years from the date of grant in the case of an ISO (the
"Option Period"); provided that the Option Period will not
exceed five years from the date of grant in the case of an ISO
granted to a 10% Stockholder. To the extent not previously
exercised, each Option will terminate upon the expiration of
the Option Period specified in the Option Agreement; provided,
however, that each such Option will terminate, if earlier:
(i) ninety days after the date that the Optionee ceases
to be an Eligible Participant for any reason, other
than by reason of death or disability or a Just Cause
Termination;
(ii) twelve months after the date that the Optionee ceases
to be an Eligible Participant by reason of such
person's death or disability; or
(iii) immediately as of the date that the Optionee ceases
to be an Eligible Participant by reason of a Just
Cause Termination.
In the event of a sale or all or substantially all of the
assets of the Company, or a merger or consolidation or other
reorganization in which the Company is not the surviving
corporation, or in which the Company becomes a subsidiary of
another corporation (any of the foregoing events, a "Corporate
Transaction"), then notwithstanding anything else herein, the
right to exercise all then outstanding Options will vest
immediately prior to such Corporate Transaction and will
terminate immediately after such Corporate Transaction;
provided, however, that if the Board, in its sole discretion,
determines that such immediate vesting of the right to
exercise outstanding Options is not in the best interests of
the Company, then the successor corporation must agree to
assume the outstanding Options or substitute therefor
Cirond Corporation 2004 Stock Option Plan - Page 9
comparable options of such successor corporation or a parent
or subsidiary of such successor corporation.
(f) OPTIONS NONTRANSFERABLE. No Option will be transferable by the
Optionee otherwise than by will or the laws of descent and
distribution, or in the case of an NSO, pursuant to a QDRO.
During the lifetime of the Optionee, the Option will be
exercisable only by him or her, or the transferee of an NSO if
it was transferred pursuant to a QDRO.
(g) QUALIFICATION OF STOCK. The right to exercise an Option will
be further subject to the requirement that if at any time the
Board determines, in its discretion, that the listing,
registration or qualification of the shares of Option Stock
called for thereunder upon any securities exchange or under
any state or federal law, or the consent or approval of any
governmental regulatory authority, is necessary or desirable
as a condition of or in connection with the granting of such
Option or the purchase of shares of Option Stock thereunder,
the Option may not be exercised, in whole or in part, unless
and until such listing, registration, qualification, consent
or approval is effected or obtained free of any conditions not
acceptable to the Board, in its discretion.
(h) ADDITIONAL RESTRICTIONS ON TRANSFER. By accepting Options
and/or Option Stock under this Plan, the Optionee will be
deemed to represent, warrant and agree as follows:
(i) SECURITIES ACT OF 1933. The Optionee understands that
the shares of Option Stock have not been registered
under the 1933 Act, and that such shares are not
freely tradeable and must be held indefinitely unless
such shares are either registered under the 1933 Act
or an exemption from such registration is available.
The Optionee understands that the Company is under no
obligation to register the shares of Option Stock.
(ii) OTHER APPLICABLE LAWS. The Optionee further
understands that Transfer of the Option Stock
requires full compliance with the provisions of all
applicable laws.
(iii) INVESTMENT INTENT. Unless a registration statement is
in effect with respect to the sale of Option Stock
obtained through exercise of Options granted
hereunder: (1) upon exercise of any Option, the
Optionee will purchase the Option Stock for his or
her own account and not with a view to distribution
within the meaning of the 1933 Act, other than as may
be effected in compliance with the 1933 Act and the
rules and regulations promulgated thereunder; (2) no
one else will have any beneficial interest in the
Option Stock; and (3) he or she has no present
intention of disposing of the Option Stock at any
particular time.
Cirond Corporation 2004 Stock Option Plan - Page 10
(i) COMPLIANCE WITH LAW. Notwithstanding any other provision of
this Plan, Options may be granted pursuant to this Plan, and
Option Stock may be issued pursuant to the exercise thereof by
an Optionee, only after there has been compliance with all
applicable federal and state securities laws, and all of the
same will be subject to this overriding condition. The Company
will not be required to register or qualify Option Stock with
the Securities and Exchange Commission or any State agency,
except that the Company will register with, or as required by
local law, file for and secure an exemption from such
registration requirements from, the applicable securities
administrator and other officials of each jurisdiction in
which an Eligible Participant would be granted an Option
hereunder prior to such grant.
(j) STOCK CERTIFICATES. Certificates representing the Option Stock
issued pursuant to the exercise of Options will bear all
legends required by law and necessary to effectuate this
Plan's provisions. The Company may place a "stop transfer"
order against shares of the Option Stock until all
restrictions and conditions set forth in this Plan and in the
legends referred to in this section 6(j) have been complied
with.
(k) NOTICES. Any notice to be given to the Company under the terms
of an Option Agreement will be addressed to the Company at its
principal executive office, Attention: Corporate Secretary, or
at such other address as the Company may designate in writing.
Any notice to be given to an Optionee will be addressed to the
Optionee at the address provided to the Company by the
Optionee. Any such notice will be deemed to have been duly
given if and when enclosed in a properly sealed envelope,
addressed as aforesaid, registered and deposited, postage and
registry fee prepaid, in a post office or branch post office
regularly maintained.
(l) OTHER PROVISIONS. The Option Agreement may contain such other
terms, provisions and conditions, including such special
forfeiture conditions, rights of repurchase, rights of first
refusal and other restrictions on Transfer of Option Stock
issued upon exercise of any Options granted hereunder, not
inconsistent with this Plan, as may be determined by the
Committee in its sole discretion.
(m) FORMULA OPTIONS. [Reserved for future consideration]
7. PROCEEDS FROM SALE OF STOCK.
Cash proceeds from the sale of shares of Option Stock issued from time
to time upon the exercise of Options granted pursuant to this Plan will
be added to the general funds of the Company and as such will be used
from time to time for general corporate purposes.
8. MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS.
Subject to the terms and conditions and within the limitations of this
Plan, and except with respect to Formula Options, the Committee may
modify, extend or renew outstanding Options granted under this Plan, or
accept the surrender of outstanding Options (to the extent
Cirond Corporation 2004 Stock Option Plan - Page 11
not theretofore exercised) and authorize the granting of new Options in
substitution therefor (to the extent not theretofore exercised).
Notwithstanding the foregoing, however, no modification of any Option
will, without the consent of the holder of the Option, alter or impair
any rights or obligations under any Option theretofore granted under
this Plan.
9. AMENDMENT AND DISCONTINUANCE.
The Board may amend, suspend or discontinue this Plan at any time or
from time to time; provided that no action of the Board will cause ISOs
granted under this Plan not to comply with Section 422 of the Code
unless the Board specifically declares such action to be made for that
purpose and provided further that no such action may, without the
approval of the stockholders of the Company, materially increase (other
than by reason of an adjustment pursuant to section 5(b) hereof) the
maximum aggregate number of shares of Option Stock in the Option Pool
that may be issued under Options granted pursuant to this Plan or
materially increase the benefits accruing to Plan participants or
materially modify eligibility requirements for the participants.
Provided, further, that the provisions of section 6(m) hereof may not
be amended more often than once during any six (6) month period, other
than to comport with changes in the Code, the Employee Retirement
Income Security Act, or the rules and regulations thereunder. Moreover,
no such action may alter or impair any Option previously granted under
this Plan without the consent of the holder of such Option.
10. PLAN COMPLIANCE WITH RULE 16B-3.
With respect to persons subject to Section 16 of the Securities
Exchange Act of 1934, transactions under this plan are intended to
comply with all applicable conditions of Rule 16b-3 or its successors
under the 1934 Act. To the extent any provision of the plan or action
by the plan administrators fails so to comply, it shall be deemed null
and void, to the extent permitted by law and deemed advisable by the
plan administrators.
11. COPIES OF PLAN.
A copy of this Plan will be delivered to each Optionee at or before the
time he or she executes an Option Agreement.
***
Date Plan Adopted by Board of Directors: September 20, 2004
Date Plan Approved by Stockholders: September 21, 2004
Cirond Corporation 2004 Stock Option Plan - Page 12