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EXHIBIT 10.7
SUPERTEL 1997 STOCK PLAN
SECTION 1
NAME AND PURPOSE
1.1 NAME. The name of the plan shall be the Supertel 1997 Stock
Plan (the "Plan").
1.2. PURPOSE OF PLAN. The purpose of the Plan is to foster and
promote the long-term financial success of the Company and increase
stockholder value by (a) motivating superior performance by means of stock
incentives, (b) encouraging and providing for the acquisition of an ownership
interest in the Company by Employees and (c) enabling the Company to
attract and retain the services of a management team responsible for the
long-term financial success of the Company.
SECTION 2
DEFINITIONS
2.1 DEFINITIONS. Whenever used herein, the following terms shall
have the respective meanings set forth below:
(a) "Act" means the Securities Exchange Act of 1934, as amended.
(b) "Award" means any Option, Stock Appreciation Right, Restricted
Stock, Stock Bonus, or any combination thereof, including Awards
combining two or more types of Awards in a single grant.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means the Compensation Committee of the Board, which
shall consist of two or more members, each of whom shall be a
"non-employee director" within the meaning of Rule 16b-3 as
promulgated under the Act.
(f) "Company" means Supertel Hospitality, Inc., a Delaware
corporation (and any successor thereto) and its Subsidiaries.
(g) "Director Award" means a grant of stock options granted to each
Eligible Director pursuant to Section 7.1 without any action by
the Board or the Committee.
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(h) "Eligible Director" means a person who is serving as a member
of the Board and who is not an Employee.
(i) "Employee" means any employee of the Company or any of its
Subsidiaries.
(j) "Fair Market Value" means, on any date, the average of the high
and low sales prices of the Stock as reported on the National
Association of Securities Dealers Automated Quotation system (or
on such other recognized market or quotation system on which the
trading prices of the Stock are traded or quoted at the relevant
time) on such date. In the event that there are no Stock
transactions reported on such system (or such other system) on
such date, Fair Market Value shall mean the average of the high
and low sale prices on the immediately preceding date on which
Stock transactions were so reported.
(k) "Option" means the right to purchase Stock at a stated price for
a specified period of time. For purposes of the Plan, an
Option may be either (i) an Incentive Stock Option within the
meaning of Section 422 of the Code or (ii) a Nonstatutory
Stock Option.
(l) "Participant" means any Employee designated by the Committee
to participate in the Plan.
(m) "Plan" means the Supertel 1997 Stock Plan, as in effect from
time to time.
(n) "Restricted Stock" shall mean a share of Stock granted to a
Participant subject to such restrictions as the Committee may
determine.
(o) "Stock" means the Common Stock of the Company, par value $.01
per share.
(p) "Stock Appreciation Right" means the right, subject to such terms
and conditions as the Committee may determine, to receive an
amount in cash or Stock, as determined by the Committee, equal
to the excess of (i) the Fair Market Value, as of the date such
Stock Appreciation Right is exercised, of the number shares of
Stock covered by the Stock Appreciation Right being exercised
over (ii) the aggregate exercise price of such Stock
Appreciation Right.
(q) "Stock Bonus" means the grant of Stock as compensation from the
Company, which may be in lieu of cash compensation otherwise
receivable by the Participant or in addition to such cash
compensation.
(r) "Subsidiary" means any corporation or partnership in which the
Company owns, directly or indirectly, 50% or more of the total
combined voting power of all classes of
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stock of such corporation or of the capital interest or profits
interest of such partnership.
2.2 GENDER AND NUMBER. Except when otherwise indicated by the context,
words in the masculine gender used in the Plan shall include the feminine
gender, the singular shall include the plural, and the plural shall include
the singular.
SECTION 3
ELIGIBILITY AND PARTICIPATION
Except as otherwise provided in Section 7.1, the only persons eligible
to participate in the Plan shall be those Employees selected by the Committee
as Participants.
SECTION 4
POWERS OF THE COMMITTEE
4.1 POWER TO GRANT. The Committee shall determine the Participants to
whom Awards shall be granted, the type or types of Awards to be granted, and
the terms and conditions of any and all such Awards. The Committee may
establish different terms and conditions for different types of Awards, for
different Participants receiving the same type of Awards, and for the same
Participant for each Award such Participant may receive, whether or not
granted at different times.
4.2 ADMINISTRATION. The Committee shall be responsible for the
administration of the Plan. The Committee, by majority action thereof,
is authorized to prescribe, amend, and rescind rules and regulations relating
to the Plan, to provide for conditions deemed necessary or advisable to protect
the interests of the Company, and to make all other determinations
necessary or advisable for the administration and interpretation of the
Plan in order to carry out its provisions and purposes. Determinations,
interpretations, or other actions made or taken by the Committee pursuant to
the provisions of the Plan shall be final, binding, and conclusive for all
purposes and upon all persons.
SECTION 5
STOCK SUBJECT TO PLAN
5.1 NUMBER. Subject to the provisions of Section 5.3, the number
of shares of Stock subject to Awards (including Director Awards) under the
Plan may not exceed 250,000 shares of Stock. The shares to be delivered under
the Plan may consist, in whole or in part, of treasury Stock or authorized
but unissued Stock, not reserved for any other purpose. The maximum number of
shares of Stock with respect to which Awards may be granted to any one
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Employee under the Plan is 20% of the aggregate number of shares of Stock
available for Awards under Section 5.1.
5.2 CANCELLED, TERMINATED OR FORFEITED AWARDS. Any shares of Stock
subject to an Award which for any reason are cancelled, terminated or
otherwise settled without the issuance of any Stock shall again be available
for Awards under the Plan.
5.3 ADJUSTMENT IN CAPITALIZATION. In the event of any Stock dividend or
Stock split, recapitalization (including, without limitation, the payment of
an extraordinary dividend), merger, consolidation, combination,
spin-off, distribution of assets to stockholders, exchange of shares, or
other similar corporate change, (i) the aggregate number of shares of Stock
available for Awards under Section 5.1 and (ii) the number of shares and
exercise price with respect to Options and the number, prices and dollar value
of other Awards, may be appropriately adjusted by the Committee, whose
determination shall be conclusive. If, pursuant to the preceding sentence, an
adjustment is made to the number of shares of Stock authorized for
issuance under the Plan, a corresponding adjustment shall be made with
respect to Director Awards granted pursuant to Section 7.1.
SECTION 6
STOCK OPTIONS
6.1 GRANT OF OPTIONS. Options may be granted to Participants at such
time or times as shall be determined by the Committee. Options granted under
the Plan may be of two types: (i) Incentive Stock Options and (ii)
Nonstatutory Stock Options. The Committee shall have complete discretion in
determining the number of Options, if any, to be granted to a Participant. Each
Option shall be evidenced by an Option agreement that shall specify the type of
Option granted, the exercise price, the duration of the Option, the number of
shares of Stock to which the Option pertains, the exercisability (if any)
of the Option in the event of death, retirement, disability or termination of
employment, and such other terms and conditions not inconsistent with the Plan
as the Committee shall determine.
6.2 OPTION PRICE. Nonstatutory Stock Options and Incentive Stock
Options granted pursuant to the Plan shall have an exercise price which is not
less than the Fair Market Value on the date the Option is granted.
6.3 EXERCISE OF OPTIONS. Options awarded to a Participant under the Plan
shall be exercisable at such times and shall be subject to such restrictions
and conditions as the Committee may impose, subject to the Committee's right
to accelerate the exercisability of such Option in its discretion.
Notwithstanding the foregoing, no Option shall be exercisable for more than
ten years after the date on which it is granted.
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6.4 PAYMENT. The Committee shall establish procedures governing the
exercise of Options, which shall require that written notice of exercise
be given and that the Option price be paid in full in cash or cash equivalents,
including by personal check, at the time of exercise or pursuant to any
arrangement that the Committee shall approve. The Committee may, in its
discretion, permit a Participant to make payment (i) in Stock already owned by
the Participant valued at its Fair Market Value on the date of exercise (if
such Stock has been owned by the Participant for at least six months) or (ii)
by electing to have the Company retain Stock which would otherwise be issued
on exercise of the Option, valued at its Fair Market Value on the date of
exercise. As soon as practicable after receipt of a written exercise notice
and full payment of the exercise price, the Company shall deliver to the
Participant a certificate or certificates representing the acquired shares of
Stock.
6.5 INCENTIVE STOCK OPTIONS. Notwithstanding anything in the Plan to the
contrary, no term of this Plan relating to Incentive Stock Options shall
be interpreted, amended or altered, nor shall any discretion or authority
granted under the Plan be so exercised, so as to disqualify the Plan under
Section 422 of the Code, or, without the consent of any Participant affected
thereby, to cause any Incentive Stock Option previously granted to fail to
qualify for the Federal income tax treatment afforded under Section 421 of
the Code.
SECTION 7
DIRECTOR AWARDS
7.1 AMOUNT OF AWARD. Each Eligible Director shall receive an annual
grant of a Nonstatutory Stock Option to acquire 1,500 shares of Stock
exercisable at the Fair Market Value of the Company's common stock on
the date of grant; such grant shall be made on the date of and immediately
following the annual meeting of stockholders (beginning with the 1998 Annual
Stockholders' Meeting). The Nonstatutory Stock Options awarded to a director
hereunder shall be appropriately adjusted in the event of any stock changes
as described in Section 5.3.
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SECTION 8
STOCK APPRECIATION RIGHTS
8.1 SAR'S IN TANDEM WITH OPTIONS. Stock Appreciation Rights may be
granted to Participants in tandem with any Option granted under the Plan,
either at or after the time of the grant of such Option, subject to such
terms and conditions, not inconsistent with the provisions of the Plan, as the
Committee shall determine. Each Stock Appreciation Right shall only be
exercisable to the extent that the corresponding Option is exercisable, and
shall terminate upon termination or exercise of the corresponding Option.
Upon the exercise of any Stock Appreciation Right, the corresponding Option
shall terminate.
8.2 OTHER STOCK APPRECIATION RIGHTS. Stock Appreciation Rights may also
be granted to Participants separately from any Option, subject to such terms
and conditions, not inconsistent with the provisions of the Plan, as the
Committee shall determine.
SECTION 9
RESTRICTED STOCK
9.1 GRANT OF RESTRICTED STOCK. The Committee may grant Restricted Stock
to Participants at such times and in such amounts, and subject to such
other terms and conditions not inconsistent with the Plan as it shall determine.
Each grant of Restricted Stock shall be subject to such restrictions, which may
relate to continued employment with the Company, performance of the Company, or
other restrictions, as the Committee may determine. Each grant of Restricted
Stock shall be evidenced by a written agreement setting forth the terms of
such Award.
9.2 REMOVAL OF RESTRICTIONS. The Committee may accelerate or waive
such restrictions in whole or in part at any time in its discretion.
SECTION 10
STOCK BONUSES
10.1 GRANT OF STOCK BONUSES. The Committee may grant a Stock Bonus to a
Participant at such times and in such amounts, and subject to such other terms
and conditions not inconsistent with the Plan, as it shall determine.
10.2 EFFECT ON COMPENSATION. The Committee may from time to time
determine to grant a Stock Bonus in lieu of salary or cash bonuses otherwise
payable to a Participant.
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SECTION 11
AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN
11.1 GENERAL. The Board may from time to time amend, modify or
terminate any or all of the provisions of the Plan, subject to the provisions
of this Section 11.1. The Board may not change the Plan in a manner which
would prevent outstanding Incentive Stock Options granted under the Plan from
being Incentive Stock Options without the consent of the optionees
concerned. Furthermore, the Board may not make any amendment which would (i)
materially modify the requirements for participation in the Plan or (ii)
increase the number of shares of Stock subject to Awards under the Plan
pursuant to Section 5.1, in each case without the consent and approval of the
holders of a majority of the outstanding shares of Stock entitled to vote
thereon. No amendment or modification shall affect the rights of any
Employee with respect to a previously granted Award, nor shall any
amendment or modification affect the rights of any Eligible Director pursuant
to a previously granted Director Award.
11.2 TERMINATION OF PLAN. No further Options shall be granted under the
Plan subsequent to December 31, 2006, or such earlier date as may be
determined by the Board.
SECTION 12
MISCELLANEOUS PROVISIONS
12.1 BENEFICIARY DESIGNATION. Each Participant under the Plan may
from time to time name any beneficiary or beneficiaries (who may be
named contingent or successively) to whom any benefit under the Plan is to be
paid or by whom any right under the Plan is to be exercised in case of his
death. Each designation will revoke all prior designations by the same
Participant shall be in a form prescribed by the Committee, and will be
effective only when filed in writing with the Committee. In the absence of
any such designation, Awards outstanding at death may be exercised by the
Participant's surviving spouse, if any, or otherwise by his estate, subject
to the terms and conditions of the Award.
12.2 NO GUARANTEE OF EMPLOYMENT OR PARTICIPATION. Nothing in the Plan
shall interfere with or limit in any way the right of the Company or any
Subsidiary to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continue in the employ of the Company or any
Subsidiary. No Employee shall have a right to be selected as a Participant, or,
having been so selected, to receive any future Awards.
12.3 TAX WITHHOLDING. The Company shall have the power to withhold,
or require a Participant or Eligible Director to remit to the Company, an
amount sufficient to satisfy federal, state, and local withholding tax
requirements on any Award under the Plan, and
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the Company may defer issuance of Stock until such requirements are
satisfied. The Committee may, in its discretion, permit a Participant to
elect, subject to such conditions as the Committee shall impose, (i) to have
shares of Stock otherwise issuable under the Plan withheld by the Company
or (ii) to deliver to the Company previously acquired shares of Stock, in
each case having a Fair Market Value sufficient to satisfy all or part of the
Participant's estimated total federal, state and local tax obligation
associated with the transaction.
12.4 CHANGE OF CONTROL. On the date of a Change of Control, all
outstanding options and stock appreciation rights shall become immediately
exercisable and all restrictions with respect to Restricted Stock shall lapse.
"Change of Control" shall mean:
(i) The acquisition (other than from the Company) by any person,
entity or "group", within the meaning of Section 13(d)(3) or
14(d)(2) of the Act (excluding any acquisition or holding by (i) the
Company or its subsidiaries or (ii) any employee benefit plan of
the Company or its subsidiaries which acquires beneficial ownership
of voting securities of the Company) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Act) of
50% or more of either the then outstanding shares of common stock
or the combined voting power of the Company's then outstanding
voting securities entitled to vote generally in the election of
directors; or
(ii) Individuals who, as of the date hereof, constitute the Board
(as of the date hereof the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board,
provided that any person becoming a director subsequent to the date
hereof whose election, or nomination for the election by the
Company's stockholders, was approved by a vote of at least a majority
of the directors then comprising the Incumbent Board shall be,
for purposes of this Plan, considered as though such person were
a member of the Incumbent Board; or
(iii) Approval by the stockholders of the Company of a reorganization,
merger or consolidation, in each case, with respect to
which persons who were the stockholders of the Company
immediately prior to such reorganization, merger or consolidation
do not, immediately thereafter, own more than 50% of the combined
voting power entitled to vote generally in the election of
directors of the reorganized, merged or consolidated company's
then outstanding voting securities, or a liquidation or
dissolution of the Company or of the sale of all or substantially
all of the assets of the Company.
12.5 COMPANY INTENT. The Company intends that the Plan comply in
all respects with Rule 16b-3 under the Act, and any ambiguities
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or inconsistencies in the construction of the Plan shall be interpreted to
give effect to such intention.
12.6 REQUIREMENTS OF LAW. The granting of Awards and the issuance
of shares of Stock shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or securities
exchanges as may be required.
12.7 EFFECTIVE DATE. The Plan shall be effective upon its adoption
by the Board subject to approval by the affirmative vote of the holders of a
majority of the shares of Stock present in person or by proxy at a stockholders'
meeting.
12.8 GOVERNING LAW. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of Delaware.
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