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EXHIBIT 10.4
FIRST AMENDMENTENT OF
ALL AMERICAN FOOD GROUP, INC.
OMNIBUS STOCK PLAN
1. AMENDMENT AND RESTATEMENT, PURPOSE AND TYPES OF AWARDS
On June 6, 1996 the Board of Directors of All American Food Group,
Inc. adopted the ALL AMERICAN FOOD GROUP, INC. OMNIBUS STOCK PLAN (the "Plan").
Pursuant to resolutions duly adopted by the Board of Directors and in
accordance with Section 10 of the Plan, the Plan has been fully amended and
restated and is embodied in this document.
The purpose of the Plan is to promote the long-term growth and
profitability of All American Food Group, Inc. (the "Corporation") by (i)
providing key people with incentives to improve stockholder value and to
contribute to the growth and financial success of the Corporation, and (ii)
enabling the Corporation to attract, retain and reward the best available
persons for positions of substantial responsibility.
The Plan permits the granting of stock options, including nonqualified
stock options and incentive stock options qualifying under Section 422 of the
Code, in any combination (collectively, "Options").
2. DEFINITIONS
Under this Plan, except where the context otherwise indicates, the
following definitions apply:
(a) "Board" shall mean the Board of Directors of the Corporation.
(b) "Change in Control" shall mean (i) any sale, exchange or other
disposition of substantially all of the Corporation's assets; or (ii) any
merger, share exchange, consolidation or other reorganization or business
combination in which the Corporation is not the surviving or continuing
corporation, or in which the Corporation's stockholders become entitled to
receive cash, securities of the Corporation other than voting common stock, or
securities of another issuer.
(c) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and any regulations issued thereunder.
(d) "Committee" shall mean the Board or committee of Board members
appointed pursuant to Section 3 of the Plan to administer the Plan.
(e) "Common Stock" shall mean shares of the Corporation's common
stock, no par value.
(f) "Fair Market Value" of a share of the Corporation's Common
Stock for any purpose on a particular date shall be determined in a manner such
as the Committee shall in good faith determine to be appropriate; provided,
however, that if the Common Stock is publicly traded, then Fair Market Value
shall mean the last reported sale price per share of Common Stock, regular way,
or, in case no such sale takes place on such day, the average of the closing
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bid and asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on a national securities exchange or included for quotation
on a system established by the National Association of Securities Dealers, Inc.
("Nasdaq System"), or if the Common Stock is not so listed or admitted to
trading or included for quotation, the last quoted price, or if the Common
Stock is not so quoted, the average of the high bid and low asked prices,
regular way, in the over-the-counter market, as reported by the National
Association of Securities Dealers, Inc. Automated Quotation System or, if such
system is no longer in use, the principal other automated quotations system
that may then be in use or, if the Common Stock is not quoted by any such
organization, the average of the closing bid and asked prices, regular way, as
furnished by a professional market maker making a market in the Common Stock as
selected in good faith by the Committee or by such other source or sources as
shall be selected in good faith by the Committee; and, provided further, that
in the case of incentive stock options, the determination of Fair Market Value
shall be made by the Committee in good faith in conformance with the Treasury
Regulations under Section 422 of the Code. If, as the case may be, the
relevant date is not a trading day, the determination shall be made as of the
next preceding trading day. As used herein, the term "trading day" shall mean
a day on which public trading of securities occurs and is reported in the
principal consolidated reporting system referred to above, or if the Common
Stock is not listed or admitted to trading on a national securities exchange or
included for quotation on the Nasdaq System, any day other than a Saturday, a
Sunday or a day in which banking institutions in the State of New York are
closed.
(g) "Grant Agreement" shall mean a written agreement between the
Corporation and a grantee memorializing the terms and conditions of an Option
granted pursuant to the Plan.
(h) "Grant Date" shall mean the date on which the Committee
formally acts to grant an Option to a grantee or such other date as the
Committee shall so designate at the time of taking such formal action.
(i) "Parent" shall mean a corporation, whether now or hereafter
existing, within the meaning of the definition of "parent corporation" provided
in Section 424(e) of the Code, or any successor thereto of similar import.
(j) "Rule 16b-3" shall mean Rule 16b-3 as in effect under the
Exchange Act on the effective date of the Plan, or any successor provision
prescribing conditions necessary to exempt the issuance of securities under the
Plan (and further transactions in such securities) from Section 16(b) of the
Exchange Act.
(k) "Subsidiary" and "subsidiaries" shall mean only a corporation
or corporations, whether now or hereafter existing, within the meaning of the
definition of "subsidiary corporation" provided in Section 424(f) of the Code,
or any successor thereto of similar import.
3. ADMINISTRATION
(a) Procedure. The Plan shall be administered by the Board. In
the alternative, the Board may appoint a Committee consisting of not less than
two (2) members of the Board to administer the Plan on behalf of the Board,
subject to such terms and conditions as the Board may prescribe. Once
appointed, the Committee shall continue to serve until otherwise directed by
the Board. From time to time, the Board may increase the size of the Committee
and appoint
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additional members thereof, remove members (with or without cause) and appoint
new members in substitution therefor, fill vacancies, however caused, and
remove all members of the Committee and, thereafter, directly administer the
Plan. In the event that the Board is the administrator of the Plan in lieu of
a Committee, the term "Committee" as used herein shall be deemed to mean the
Board.
Members of the Board or Committee who are either eligible for
Options or have been granted Options may vote on any matters affecting the
administration of the Plan or the grant of Options pursuant to the Plan, except
that no such member shall act upon the granting of an Option to himself or
herself, but any such member may be counted in determining the existence of a
quorum at any meeting of the Board or the Committee during which action is
taken with respect to the granting of an Option to him or her.
The Committee shall meet at such times and places and upon
such notice as it may determine. A majority of the Committee shall constitute
a quorum. Any acts by the Committee may be taken at any meeting at which a
quorum is present and shall be by majority vote of those members entitled to
vote. Additionally, any acts reduced to writing or approved in writing by all
of the members of the Committee shall be valid acts of the Committee.
(b) Procedure After Registration of Common Stock. Notwithstanding
the provisions of subsection (a) above, in the event that the Common Stock or
any other capital stock of the Corporation becomes registered under Section 12
of the Exchange Act, the members of the Committee shall be both "non-employee
directors" within the meaning of Rule 16b-3, and "outside directors" within the
meaning of Section 162(m) of the Code. Upon and after the point in time that
the Common Stock or any other capital stock of the Corporation becomes
registered under Section 12 of the Exchange Act, the Board shall take all
action necessary to cause the Plan to be administered in accordance with the
then effective provisions of Rule 16b-3, provided that any amendment to the
Plan required for compliance with such provisions shall be made in accordance
with Section 10 of the Plan.
(c) Powers of the Committee. The Committee shall have all the
powers vested in it by the terms of the Plan, such powers to include authority,
in its sole and absolute discretion, to grant Options under the Plan, prescribe
Grant Agreements evidencing such Options and establish programs for granting
Options. The Committee shall have full power and authority to take all other
actions necessary to carry out the purpose and intent of the Plan, including,
but not limited to, the authority to:
(i) determine the eligible persons to whom, and the time or
times at which Options shall be granted,
(ii) determine the types of Options to be granted,
(iii) determine the number of shares to be covered by each
Option,
(iv) impose such terms, limitations, restrictions and
conditions upon any such Option as the Committee shall deem
appropriate,
(v) modify, extend or renew outstanding Options, accept the
surrender of outstanding Options and substitute new Options, provided
that no such action
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shall be taken with respect to any outstanding Option which would
adversely affect the grantee without the grantee's consent, and
(vi) accelerate or otherwise change the time in which an
Option may be exercised, in whole or in part, including, but not
limited to, any restriction or condition with respect to the vesting
or exercisability of an Option following termination of any grantee's
employment.
The Committee shall have full power and authority to administer and interpret
the Plan and to adopt such rules, regulations, agreements, guidelines and
instruments for the administration of the Plan and for the conduct of its
business as the Committee deems necessary or advisable and to interpret same,
all within the Committee's sole and absolute discretion.
(d) Limited Liability. To the maximum extent permitted by law, no
member of the Committee shall be liable for any action taken or decision made
in good faith relating to the Plan or any Option thereunder.
(e) Indemnification. To the maximum extent permitted by law, the
members of the Committee shall be indemnified by the Corporation in respect of
all their activities under the Plan.
(f) Effect of Committee's Decision. All actions taken and
decisions and determinations made by the Committee on all matters relating to
the Plan pursuant to the powers vested in it hereunder shall be in the
Committee's sole and absolute discretion and shall be conclusive and binding on
all parties concerned, including the Corporation, its stockholders, any
participants in the Plan and any other employee of the Corporation, and their
respective successors in interest.
4. SHARES AVAILABLE FOR THE PLAN; MAXIMUM AWARDS
Subject to adjustments as provided in Section 9 of the Plan, the
shares of stock that may be delivered or purchased under the Plan, including
with respect to incentive stock options intended to qualify under Section 422
of the Code, shall not exceed an aggregate of 350,000 shares of Common Stock of
the Corporation. The Corporation shall reserve said number of shares for
Options to be awarded under the Plan, subject to adjustments as provided in
Section 9 of the Plan. If any Option, or portion of an Option, under the Plan
expires or terminates unexercised, becomes unexercisable or is forfeited or
otherwise terminated, surrendered or canceled as to any shares, the shares
subject to such Option shall thereafter be available for further Options under
the Plan.
The maximum number of shares of Common Stock subject to Options of any
combination that may be granted during any 12 consecutive month period to any
one individual shall be limited to 120,000 shares. To the extent required by
Section 162(m) of the Code, if an option is terminated, surrendered or
canceled, the shares of Common Stock subject to such option shall continue to
be counted against the maximum number of shares for which options may be
granted for any one calendar year to any one individual.
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5. PARTICIPATION
Participation in the Plan shall be open to all employees, officers and
directors of the Corporation, or of any Parent or Subsidiary of the
Corporation, as may be selected by the Committee from time to time.
Notwithstanding the foregoing, participation in the Plan with respect to awards
of incentive stock options shall be limited to employees of the Corporation or
of any Parent or Subsidiary of the Corporation. To the extent necessary to
comply with Rule 16b-3 or to constitute an "outside director" within the
meaning of Section 162(m) of the Code, and only in the event that Rule 16b-3 or
Section 162(m) of the Code is applicable to the Plan or an Option awarded
thereunder, Committee members shall not be eligible to participate in the Plan
while members of the Committee.
Options may be granted to such eligible persons and for or with
respect to such number of shares of Common Stock as the Committee shall
determine, subject to the limitations in Section 4 of the Plan. A grant of any
type of Option made in any one year to an eligible person shall neither
guarantee nor preclude a further grant of that or any other type of Option to
such person in that year or subsequent years.
6. STOCK OPTIONS
Subject to the other applicable provisions of the Plan, the Committee
may from time to time grant to eligible participants nonqualified stock options
or incentive stock options as that term is defined in Section 422 of the Code.
The Options granted shall be subject to the following terms and conditions.
(a) Grant of Option. The grant of an Option shall be evidenced by
a Grant Agreement, executed by the Corporation and the grantee, stating the
number of shares of Common Stock subject to the Option evidenced thereby and
the terms and conditions of such Option, in such form as the Committee may from
time to time determine.
(b) Price. The price per share payable upon the exercise of each
Option ("exercise price") shall be determined by the Committee; provided,
however, that in the case of incentive stock options, the exercise price shall
not be less than 100% of the Fair Market Value of the shares on the date the
Option is granted.
(c) Payment. Options may be exercised in whole or in part by
payment of the exercise price of the shares to be acquired in accordance with
the provisions of the Grant Agreement, and/or such rules and regulations as the
Committee may have prescribed, and/or such determinations, orders, or decisions
as the Committee may have made. Payment of the exercise price shall be made in
cash (or cash equivalents acceptable to the Committee) or by such other means
as the Committee may prescribe. The Corporation may make or guarantee loans to
grantees to assist grantees in exercising Options.
If the Common Stock is registered under Section 12(b) or 12(g) of the
Exchange Act, the Committee, subject to such limitations as it may determine,
may authorize payment of the exercise price, in whole or in part, by delivery
of a properly executed exercise notice, together with irrevocable instructions,
to: (i) a brokerage firm designated by the Corporation to deliver promptly to
the Corporation the aggregate amount of sale or loan proceeds to pay the
exercise price and any withholding tax obligations that may arise in connection
with the exercise, and
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(ii) the Corporation to deliver the certificates for such purchased shares
directly to such brokerage firm.
(d) Terms of Options. The term during which each Option may be
exercised shall be determined by the Committee. In no event shall an Option be
exercisable less than six months nor more than ten years from the date it is
granted. Prior to the exercise of the Option and delivery of the shares
certificates represented thereby, the grantee shall have none of the rights of
a stockholder with respect to any shares represented by an outstanding Option.
(e) Restrictions on Incentive Stock Options. The aggregate Fair
Market Value (determined as of the Grant Date) of shares of Common Stock with
respect to which all incentive stock options first become exercisable by any
grantee in any calendar year under this or any other plan of the Corporation
and its Parent and Subsidiary corporations may not exceed $100,000 or such
other amount as may be permitted from time to time under Section 422 of the
Code. To the extent that such aggregate Fair Market Value shall exceed
$100,000, or other applicable amount, such Options (taking Options into account
in the order in which they were granted) shall be treated as nonqualified stock
options. In such case, the Corporation may designate the shares of Common
Stock that are to be treated as stock acquired pursuant to the exercise of an
incentive stock option by issuing a separate certificate for such shares and
identifying the certificate as incentive stock option shares in the stock
transfer records of the Corporation.
The exercise price of any incentive stock option granted to a grantee
who owns (within the meaning of Section 422(b)(6) of the Code, after the
application of the attribution rules in Section 424(d) of the Code) more than
10% of the total combined voting power of all classes of shares of the
Corporation or its Parent or Subsidiary corporations (within the meaning of
Sections 422 and 424 of the Code) shall be not less than 110% of the Fair
Market Value of the Common Stock on the grant date and the term of such Option
shall not exceed five years.
Incentive stock options shall only be issued to employees of the
Corporation or of a Parent or Subsidiary of the Corporation.
(f) Other Terms and Conditions. Options may contain such other
provisions, not inconsistent with the provisions of the Plan, as the Committee
shall determine appropriate from time to time. No Option shall be an incentive
stock option unless so designated by the Committee at the time of grant or in
the Grant Agreement evidencing such Option.
7. WITHHOLDING OF TAXES
The Corporation may require, as a condition to any exercise of an
Option under the Plan or a Grant Agreement (hereinafter referred to as a
"taxable event"), that the grantee pay to the Corporation, in cash, any
federal, state or local taxes of any kind required by law to be withheld with
respect to any taxable event under the Plan. The Corporation, to the extent
permitted or required by law, shall have the right to deduct from any payment
of any kind (including salary or bonus) otherwise due to a grantee any federal,
state or local taxes of any kind required by law to be withheld with respect to
any taxable event under the Plan, or to retain or sell without notice a
sufficient number of the shares to be issued to such grantee to cover any such
taxes.
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8. TRANSFERABILITY
To the extent required to comply with Rule 16b-3, and in any event in
the case of an incentive stock option, no Option granted under the Plan shall
be transferable by a grantee otherwise than by will or the laws of descent and
distribution. Unless otherwise determined by the Committee in accord with the
provisions of the immediately preceding sentence, an Option may be exercised
during the lifetime of the grantee, only by the grantee or, during the period
the grantee is under a legal disability, by the grantee's guardian or legal
representative.
9. ADJUSTMENTS; BUSINESS COMBINATIONS
In the event of a reclassification, recapitalization, stock split,
stock dividend, combination of shares, or other similar event, the maximum
number and kind of shares reserved for issuance or with respect to which
Options may be granted under the Plan as provided in Section 4 shall be
adjusted to reflect such event, and the Committee shall make such adjustments
as it deems appropriate and equitable in the number, kind and price of shares
covered by outstanding Options made under the Plan, and in any other matters
which relate to Options and which are affected by the changes in the Common
Stock referred to above.
In the event of any proposed Change in Control, the Committee shall
take such action as it deems appropriate to effectuate the purposes of this
Plan and to protect the grantees of Options, which action may include, but
without limitation, any one or more of the following: (i) acceleration or
change of the exercise dates of any Option; (ii) arrangements with grantees for
the payment of appropriate consideration to them for the cancellation and
surrender of any Option; and (iii) in any case where equity securities other
than Common Stock of the Corporation are proposed to be delivered in exchange
for or with respect to Common Stock of the Corporation, arrangements providing
that any Option shall become one or more Options with respect to such other
equity securities.
In the event the Corporation dissolves and liquidates (other than
pursuant to a plan of merger or reorganization), then notwithstanding any
restrictions on exercise set forth in this Plan or any Grant Agreement (i) each
grantee shall have the right to exercise his Option at any time up to ten (10)
days prior to the effective date of such liquidation and dissolution; and (ii)
the Committee may make arrangements with the grantees for the payment of
appropriate consideration to them for the cancellation and surrender of any
Option that is so canceled or surrendered at any time up to ten (10) days prior
to the effective date of such liquidation and dissolution. The Committee may
establish a different period (and different conditions) for such exercise,
cancellation, or surrender to avoid subjecting the grantee to liability under
Section 16(b) of the Exchange Act. Any Option not so exercised, canceled, or
surrendered shall terminate on the last day for exercise prior to such
effective date.
10. TERMINATION AND MODIFICATION OF THE PLAN
The Board, without further approval of the stockholders, may modify or
terminate the Plan or any portion thereof at any time, except that no
modification shall become effective without prior approval of the stockholders
of the Corporation if stockholder approval is necessary to comply with any tax
or regulatory requirement or rule of any exchange or Nasdaq System upon which
the Common Stock is listed or quoted; including for this purpose stockholder
approval that is required for continued compliance with Rule 16b-3 or
stockholder approval that is required to enable the Committee to grant
incentive stock options pursuant to the Plan.
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The Committee shall be authorized to make minor or administrative
modifications to the Plan as well as modifications to the Plan that may be
dictated by requirements of federal or state laws applicable to the Corporation
or that may be authorized or made desirable by such laws. The Committee may
amend or modify the grant of any outstanding Option in any manner to the extent
that the Committee would have had the authority to make such Option as so
modified or amended. No modification may be made that would materially
adversely affect any Option previously made under the Plan without the approval
of the grantee.
11. NON-GUARANTEE OF EMPLOYMENT
Nothing in the Plan or in any Grant Agreement thereunder shall confer
any right on an employee to continue in the employ of the Corporation or shall
interfere in any way with the right of the Corporation to terminate an employee
at any time.
12. TERMINATION OF EMPLOYMENT
For purposes of maintaining a grantee's continuous status as an
employee and accrual of rights under any Options, transfer of an employee among
the Corporation and the Corporation's Parent or Subsidiaries shall not be
considered a termination of employment. Nor shall it be considered a
termination of employment for such purposes if an employee is placed on
military or sick leave or such other leave of absence which is considered as
continuing intact the employment relationship; in such a case, the employment
relationship shall be continued until the date when an employee's right to
reemployment shall no longer be guaranteed either by law or contract.
13. WRITTEN AGREEMENT
Each Grant Agreement entered into between the Corporation and a
grantee with respect to an Option granted under the Plan shall incorporate the
terms of this Plan and shall contain such provisions, consistent with the
provisions of the Plan, as may be established by the Committee.
14. NON-UNIFORM DETERMINATIONS
The Committee's determinations under the Plan (including without
limitation determinations of the persons to receive Options, the form, amount
and timing of such Options, the terms and provisions of such Options and the
agreements evidencing same) need not be uniform and may be made by it
selectively among persons who receive, or are eligible to receive, Options
under the Plan, whether or not such persons are similarly situated.
15. LIMITATION ON BENEFITS
With respect to persons subject to Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3. To the extent any provision of the Plan or action by
the Committee fails to so comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Committee.
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16. LISTING AND REGISTRATION
If the Corporation determines that the listing, registration or
qualification upon any securities exchange or upon any Nasdaq System or under
any law, of shares subject to any Option is necessary or desirable as a
condition of, or in connection with, the granting of same or the issue or
purchase of shares thereunder, no such Option may be exercised in whole or in
part and no restrictions on such Option shall lapse, unless such listing,
registration or qualification is effected free of any conditions not acceptable
to the Corporation.
17. COMPLIANCE WITH SECURITIES LAWS
The Corporation may require that a grantee, as a condition to exercise
of an Option, and as a condition to the delivery of any share certificate,
provide to the Corporation, at the time of each such exercise and each such
delivery, a written representation that the shares of Common Stock being
acquired shall be acquired by the grantee solely for investment and will not be
sold or transferred without registration or the availability of an exemption
from registration under the Securities Act and applicable state securities
laws. The Corporation may also require that a grantee submit other written
representations which will permit the Corporation to comply with federal and
applicable state securities laws in connection with the issuance of the Common
Stock, including representations as to the knowledge and experience in
financial and business matters of the grantee and the grantee's ability to bear
the economic risk of the grantee's investment. The Corporation may require
that the grantee obtain a "purchaser representative" as that term is defined in
applicable federal and state securities laws. The stock certificates for any
shares of Common Stock issued pursuant to this Plan may bear a legend
restricting transferability of the shares of Common Stock unless such shares
are registered or an exemption from registration is available under the
Securities Act and applicable state securities laws. The Corporation may
notify its transfer agent to stop any transfer of shares of Common Stock not
made in compliance with these restrictions. Common Stock shall not be issued
with respect to an Option granted under the Plan unless the exercise of such
Option and the issuance and delivery of share certificates for such Common
Stock pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act, the Exchange Act, the rules
and regulations promulgated thereunder, and the requirements of any national
securities exchange or Nasdaq System upon which the Common Stock may then be
listed or quoted, and shall be further subject to the approval of counsel for
the Corporation with respect to such compliance to the extent such approval is
sought by the Committee.
18. GOVERNING LAW
The validity, construction and effect of the Plan, of Grant Agreements
entered into pursuant to the Plan, and of any rules, regulations,
determinations or decisions made by the Board or Committee relating to the Plan
or such Grant Agreements, and the rights of any and all persons having or
claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the
State of New Jersey, without regard to its conflict of laws rules and
principles.
19. PLAN SUBJECT TO CHARTER AND BY-LAWS
This Plan is subject to the Charter and By-Laws of the Corporation, as
they may be amended from time to time.
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20. EFFECTIVE DATE; TERMINATION DATE
The Plan is effective as of June 6, 1996, the date on which the Plan
was adopted by the Board, subject to approval of the stockholders within twelve
months of such date. Unless previously terminated, the Plan shall terminate on
the close of business on June 6, 2006, ten years from the effective date.
Subject to other applicable provisions of the Plan, all Options granted under
the Plan prior to termination of the Plan shall remain in effect until such
Options have been satisfied or terminated in accordance with the Plan and the
terms of such Options.
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