EXHIBIT 10.11
INTEGRAL VISION, INC.
2004 EMPLOYEE STOCK OPTION PLAN
1. Purpose. This Employee Stock Option Plan (the "Plan") is intended
to further the growth and development of INTEGRAL VISION, INC. (the "Company")
by affording an opportunity to eligible officers and key employees of the
Company and its subsidiaries, as well as nonemployee directors, consultants or
advisors, who are in a position to contribute materially to the prosperity of
the Company, to purchase shares of its common stock. It is further intended that
options issued pursuant to the Plan may be either nonqualified stock options or
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended.
2. Stock Offering. The Board of Directors of the Company are
authorized to offer and sell stock pursuant to this Plan. The aggregate amount
of stock which may be sold and delivered under the Plan, against payment
therefor, shall not exceed one million (1,000,000) shares. In the event that any
outstanding option under the Plan expires or is terminated for any reason prior
to the end of the period during which options may be granted, the shares of
common stock allocable to the unexercised or canceled portion of such Plan may
again be subjected to an option under the Plan.
3. Designation of Participants and Administration of Plan. The Board
of Directors, or not less than two (2) Board Members appointed from time to time
by the Board of Directors, shall act as a Committee to administer the Plan. The
employees eligible to participate in the Plan shall be the officers and any
other key employees of the Company and its subsidiaries as the Board of
Directors may designate. Directors who are not also employees of the Company,
consultants and advisors are not eligible to receive incentive stock options,
but may be granted nonqualified stock options.
4. Unauthorized Employees. In no event shall an incentive stock
option be granted to any individual who,immediately before such option is
granted, owns (as defined in Section 422 and 425(d) of the Internal Revenue Code
of 1986, as amended) stock possessing more than ten percent (10%) of the total
combined voting power or value of all classes of stock of the Company or of its
parent or subsidiary corporation, unless the option price to such individual is
no less than 110% of the fair market value of the stock at the time the option
is granted and such option by its terms is not exercisable after the expiration
of five years from the date such option is granted.
5. Effective Date of Plan. The Plan is effective on the date of
ratification by a vote of the holders of a majority of the common stock of the
Company after adoption by the Board of Directors. The Company shall not be
required to issue any stock hereunder, however, until the approvals required by
the proper public authorities have been obtained, if any, and the Board of
Directors shall have been advised by counsel for the Company that all other
applicable legal requirements have been complied with.
6. Termination of Plan. The Plan shall remain in effect until and
shall terminate upon the expiration of ten (10) years from the date the Plan is
adopted. The Plan may be terminated at an earlier date by action of the Board of
Directors. Termination of the Plan shall not affect the rights of beneficiaries
under options granted to purchase common stock under the Plan prior to
termination or to complete payment for and to receive any pledged shares, and
all such options shall continue in force and operation after termination of the
Plan, except as they may be terminated in accordance with the terms of the Plan.
The Board of Directors of the Company may from time to time suspend or
discontinue the Plan with respect to any shares as to which options have not
been granted.
7. Offering to Designated Beneficiaries. Beneficiaries designated by
the committee shall be granted options to purchase stock. Option periods shall
be fixed by the committee (subject to the provisions of paragraph 4), but shall
not exceed ten (10) years.
8. Exercise of Options. Options may be exercised in whole or in part
from time to time, but in no event may any option be exercised after ten (10)
years from the date on which such option is granted (subject to the provisions
of paragraph 4).
9. Option Price. The option price shall be not less than 100% of the
fair market value of the stock at the time the option is granted (subject to the
provisions of paragraph 4). The fair market value per share shall be the closing
price of the common stock on the Over The Counter Market on the day the option
is granted, as reported by the National Association of Security Dealers,
Automatic Quotation System (NASDAQ), or if no sale of the Company's common stock
shall have been made on that day, on the next preceding day on which there was a
sale of such stock. If the stock is listed upon an established stock exchange or
exchanges, fair market value shall be deemed to be the highest closing price of
the common stock on such stock exchange or exchanges on the day the option is
granted. Subject to the foregoing, the Committee in fixing the option price
shall have full authority and discretion and be fully protected in doing so.
10. Non-Transferability. Beneficiaries' rights under the Plan are
wholly personal and no assignment or transfer of a beneficiary's rights and
interests in the Plan will be permitted or recognized other than at death. An
option is exercisable during the lifetime of the beneficiary to whom the option
was granted only by such beneficiary.
11. Limit on Annual Eligibility. A participant in the Plan shall not
be granted or be entitled to exercise, in any calendar year, incentive stock
options on which the aggregate fair market value of the stock (determined at the
date the option is granted) exceeds the annual limit established by Section 422
of the Internal Revenue Code of 1986, as amended.
12. Payment. Upon exercise of any option granted hereunder, payment
in full shall be made at the time of such exercise for all shares then being
purchased; except, however, that the committee may in its discretion permit the
issuance of stock upon such plan of partial payment as it deems reasonable.
13. Offset. The Company shall be authorized to apply the payment of
any amount due to it under this Plan, to any compensation or other amount due
from the Company or subsidiary to the beneficiary.
14. Termination of Employment. In the event that an optionee who has
been granted an incentive stock option shall cease to be employed by the
Company, his option shall terminate at the expiration of three (3) months from
such cessation. If any cessation of employment is due to permanent and total
disability the optionee shall have the right to exercise his option at any time
within twelve (12) months after leaving employment.
15. Stock Dividends or Recapitalization; Merger or Acquisition.
(a) If any stock dividend is declared upon the common stock, or if
there is any recapitalization of the Company with respect to
its common stock, resulting in a split-up or combination or
exchange or shares, the number and kind of shares then subject
to options granted to beneficiaries under the Plan shall be
proportionately and appropriately adjusted, without any change
in the aggregate purchase prices to be paid therefore. In the
alternative, in the discretion of the committee, the option
price may be appropriately adjusted without change in the
number of shares subject to such options.
(b) Subject to any required action by the stockholders, if the
Company shall be the surviving corporation in any merger or
consolidation, any option granted hereunder shall pertain to
and apply to the securities to which a holder of the number of
shares of common stock subject to the option would have been
entitled. However, a dissolution or liquidation of the Company
or a merger or consolidation in which the Company is not the
surviving corporation, shall cause every unexercised option
outstanding hereunder to terminate unless the surviving
corporation specifically agrees that the options shall apply to
shares in such surviving corporation or its parent or
subsidiary and the difference between the option price and the
fair market value of the new option shares immediately
following the transaction does not exceed the difference
between the option price and the fair market value of the old
option shares immediately before the transaction..
16. Fractional Shares. No fractional shares of stock shall be issued
upon the exercise of any option, and in case a participating beneficiary shall
become entitled to any interest in a fractional share, by reason of a stock
dividend or otherwise, the Company shall either (a) sell the same and credit the
proceeds of the sale to the beneficiary or (b) credit to the beneficiary a cash
sum equal to the market value of such fractional share interest on the date when
such stock dividend was paid for or such fractional share interest was otherwise
created.
17. Administration and Amendment of Plan. The Option Committee of
the Board of Directors shall have the power to interpret the provisions of the
Plan, to make regulations, and to formulate administrative provisions for
carrying it out, and to make such changes in the Plan and in the regulations and
administrative provisions as, from time to time, the committee deems proper and
in the best interest of the Company; provided, it may not increase the number of
shares authorized for the Plan, nor reduce the option price below the minimum
price provided in the Plan. Without limiting the generality of the foregoing,
the committee shall have the power in its discretion to make such changes in the
Plan as to termination of the options granted to designated beneficiaries as the
committee may deem advisable because of changes in the law while the Plan is in
effect or for any other reason; provided, further, no change in an option
already granted to an beneficiary shall be made without the written consent of
the beneficiary concerned. No member of the committee or the Board of Directors
shall be liable for any action or determination made in good faith. All actions
of the committee shall be final.
18. Other Provisions. The option agreements authorized under the
Plan shall contain such other provisions as the committee shall deem advisable.
19. Application of Funds. The proceeds received by the Company from
the sale of common stock pursuant to options, except as otherwise provided
herein, will be used for general corporate purposes.
20. Indemnification and Exculpation.
(a) Each person who is or shall have been a member of the Board of
Directors or the Option Committee shall be indemnified and held
harmless by the Company against and from any and all loss,
cost, liability, or expense that may be imposed upon or
reasonably incurred by him, in connection with or resulting
from any claim, action, suit, or proceeding to which he may be
or become a party or in which he may be or become involved by
reason of any action taken or failure to act under the Plan and
against and from any and all amount paid by him in settlement
thereof (with the Company's written approval) or paid by him in
satisfaction of a judgment in any such action, suit, or
proceeding, except a judgment in favor of the Company based
upon a finding of his lack of good faith; subject, however, to
the condition that upon the institution of any claim, action,
suit, or proceeding against him, he shall in writing give the
Company an opportunity, at its own expense, to handle and
defend the same before he undertakes to handle and defend it on
his own behalf. The foregoing right of indemnification shall
not be exclusive of any other right to which such person may be
entitled as a matter of law or otherwise, or any power that the
Company may have to indemnify him or hold him harmless.
(b) Each member of the Board, the Option Committee and each officer
and employee of the Company shall be fully justified in relying or acting in
good faith upon any information furnished in connection with the administration
of the Plan by any appropriate person or persons other than himself. In no event
shall any person who is or shall have been a member of the Board, the Option
Committee, or an officer or employee of the Company be held liable for any
determination made or other action taken or any omission to act in reliance upon
any such information, or for any action (including the furnishing of
information) taken or any failure to act, if in good faith.
Plan adopted by the Board of Directors on May 6, 2004
Plan approved by the Shareholders on May 6, 2004