EXHIBIT A
DIMENSIONAL VISIONS, INC.
1999 STOCK OPTION PLAN
SECTION 1. PURPOSE
The purpose of Dimensional Visions, Inc.'s 1999 Stock Option Plan (the
"Plan") is to advance the interest of Dimensional Visions, Inc. (the "Company")
by encouraging and enabling the acquisition of a financial interest in the
Company by officers and other key employees of the Company. In addition, the
Plan is intended to aid the Company in attracting and retaining key employees,
to stimulate the efforts of such employees and to strengthen their desire to
remain in the employ of the Company.
SECTION 2. DEFINITIONS
"Business Day" means a day on which the NASDAQ is open for securities
trading.
"Change in Control" shall mean a change in control of a nature that would
be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A under the Securities Exchange Act of 1934 ("1934 Act") as in
effect on January 1, 1999, provided that such a change in control shall be
deemed to have occurred at such time as (i) any "person" (as that term is used
in Sections 13(d) and 14(d)(2) of the 1934 Act), is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the 1934 Act as in effect on January 1,
1999) directly or indirectly, of securities representing 20% or more of the
combined voting power for election of directors of the then outstanding
securities of the Company or any successor of the Company; (ii) during any
period of two (2) consecutive years or less, individuals who at the beginning of
such period constituted the Board of Directors of the Company cease, for any
reason, to constitute at least a majority of the Board of Directors, unless the
election or nomination for election of each new director was approved by a vote
of at least two-thirds of the directors then still in office who were directors
at the beginning of the period; (iii) the share owners of the Company approve
any merger or consolidation as a result of which the DVUI Common Stock (as
defined below) shall be changed, converted or exchanged (other than a merger
with a wholly owned subsidiary of the Company) or any liquidation of the Company
or any sale or other disposition of 50% or more of the assets or earning power
of the Company; or (iv) the share owners of the Company approve any merger or
consolidation to which the Company is a party as a result of which the persons
who were share owners of the Company immediately prior to the effective date of
the merger or consolidation shall have beneficial ownership of less than 50% of
the combined voting power for election of directors of the surviving corporation
following the effective date of such merger or consolidation; provided, however,
that no Change in Control shall be deemed to have occurred if, prior to such
times as a Change in Control would otherwise be deemed to have occurred, the
Board of Directors determines otherwise.
"ISO" means an incentive stock option within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended.
"DVUI Common Stock" means Dimensional Visions, Inc. Common Stock, par value
$.001 per share.
"NSO" means a stock option that does not constitute an ISO.
"Options" means ISOs and NSOs granted under this Plan.
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SECTION 3. OPTIONS
The Company may grant ISOs and NSOs to those persons meeting the
eligibility requirements in Section 6.
SECTION 4. ADMINISTRATION
The Plan shall be administered by the Board of Directors. No person, other
than members of the Board of Directors, shall have any discretion concerning
decisions regarding the Plan. The Board shall determine the key employees of the
Company (including officers, whether or not they are directors) to whom, and the
time or times at which, Options will be granted; the number of shares to be
subject to each Option; the duration of each Option; the time or times within
which the Option may be exercised; the cancellation of the Option (with the
consent of the holder thereof); and the other conditions of the grant of the
Option, at grant or while outstanding, pursuant to the terms of the Plan. The
provisions and conditions of the Options need not be the same with respect to
each optionee or with respect to each Option.
The Board may, subject to the provisions of the Plan, establish such rules
and regulations as it deems necessary or advisable for the proper administration
of the Plan, and may make determinations and may take such other action in
connection with or in relation to the Plan as it deems necessary or advisable.
Each determination or other action made or taken pursuant to the Plan, including
interpretation of the Plan and the specific conditions and provisions of the
Options granted hereunder by the Board, shall be final and conclusive for all
purposes and upon all persons including, but without limitation, the Company,
the Board, officers and the affected employees of the Company, optionees and the
respective successors in interest of any of the foregoing.
SECTION 5. STOCK
The DVUI Common Stock to be issued, transferred and/or sold under the Plan
shall be made available from authorized and unissued DVUI Common Stock or from
the Company's treasury shares. The total number of shares of DVUI Common Stock
that may be issued or transferred under the Plan pursuant to Options granted
thereunder may not exceed 1,500,000 shares (subject to adjustment as described
below). Such number of shares shall be subject to adjustment in accordance with
Section 5 and Section 11. DVUI Common Stock subject to any unexercised portion
of an Option which expires or is canceled, surrendered or terminated for any
reason may again be subject to Options granted under the Plan.
SECTION 6. ELIGIBILITY
Options may be granted to employees and directors of the Company.
SECTION 7. AWARDS OF OPTIONS
Except as otherwise specifically provided in this Plan, Options granted
pursuant to the Plan shall be subject to the following terms and conditions:
(a) Option Price. The option price will be 100% of the fair market value of
the DVUI Common Stock on the date of grant. The fair market value of a share of
DVUI Common Stock shall be the average of the high and low market prices at
which a share of DVUI Common Stock shall have been sold on the date of grant, or
on the next preceding trading day if such date was not a trading date, as
reported on the NASDAQ Transactions listing.
(b) Payment. The option price shall be paid in full at the time of
exercise. Payment must be in cash.
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(c) Exercise May Be Delayed Until Withholding is Satisfied. The Company may
refuse to exercise an Option if the optionee has not made arrangements
satisfactory to the Company to satisfy the tax withholding which the Company
determines is necessary to comply with applicable requirements.
(d) Duration of Options. The duration of Options shall be determined by the
Board, but in no event shall the duration of an ISO exceed ten (10) years from
the date of its grant or the duration of an NSO exceed fifteen (15) years from
the date of its grant.
(e) Other Terms and Conditions. Options may contain such other provisions,
not inconsistent with the provisions of the Plan, as the Board shall determine
appropriate from time to time, including vesting provisions; provided, however,
that, except in the event of a Change in Control or the disability or death of
the optionee, no Option shall be exercisable in whole or in part for a period of
twelve (12) months from the date on which the Option is granted. The grant of an
Option to any employee shall not affect in any way the right of the Company to
terminate the employment of the holder thereof.
(f) ISOs. The Board, with respect to each grant of an Option to an
optionee, shall determine whether such Option shall be an ISO, and, upon
determining that an Option shall be an ISO, shall designate it as such in the
written instrument evidencing such Option. If the written instrument evidencing
an Option does not contain a designation that it is an ISO, it shall not be an
ISO.
The aggregate fair market value (determined in each instance on the date on
which an ISO is granted) of the DVUI Common Stock with respect to which ISOs are
first exercisable by any optionee in any calendar year shall not exceed $250,000
for such optionee. If any subsidiary of the Company shall adopt a stock option
plan under which options constituting ISOs may be granted, the fair market value
of the stock on which any such incentive stock options are granted and the times
at which such incentive stock options will first become exercisable shall be
taken into account in determining the maximum amount of ISOs which may be
granted to the optionee under this Plan in any calendar year.
SECTION 8. NONTRANSFERABILITY OF OPTIONS
No Option granted pursuant to the Plan shall be transferable otherwise than
by will or by the laws of descent and distribution. During the lifetime of an
optionee, the Option shall be exercisable only by the optionee personally or by
the optionee's legal representative.
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SECTION 9. EFFECT OF TERMINATION OF EMPLOYMENT, OTHER CHANGES OF EMPLOYMENT OR
EMPLOYER STATUS, DEATH, RETIREMENT OR A CHANGE IN CONTROL
EVENT IMPACT ON VESTING IMPACT ON EXERCISE PERIOD
----- ----------------- -------------------------
Employment terminates All options become immediately Option expiration date provided
upon Disability vested in grant continues to apply
Employment terminates Option held at least 12 full Option expiration date provided
upon Retirement calendar months become in grant continues to apply
immediately vested; options held
less than 12 full calendar months
are forfeited
Employment terminates All options become immediately Right of executor, administrator
upon death vested of estate (or other transferee
permitted by Section 8)
terminates on earlier of (1) 12
months from the date of death,
or (2) the expiration date
provided in the Option
Employment terminates All options become immediately Option expiration date provided
upon Change in Control vested in grant continues to apply
Termination of employment Unvested options are forfeited Expires upon earlier of 6 months
for other reasons (Optionees from termination date or option
should be aware that the expiration date provided in grant
receipt of severance does
not extend their termination
date)
US military leave Vesting continues during leave Option expiration date provided
in grant continues to apply
US FMLA leave of Vesting continues during leave Option expiration date provided
absence in grant continues to apply
In the case of other leaves of absence not specified above, optionees will
be deemed to have terminated employment (so that options unvested will expire
and the option exercise period will end on the earlier of 6 months from the date
the leave began or the option expiration date provided in the grant), unless the
Board identifies a valid business interest in doing otherwise in which case it
may specify what provisions it deems appropriate in its sole discretion;
provided that the Board shall have no obligation to consider any such matters.
Notwithstanding the foregoing provisions, the Board may, in its sole
discretion, establish different terms and conditions pertaining to the effect of
an optionee's termination on the expiration or exercisability of Options at the
time of grant or (with the consent of the affected optionee) outstanding
Options. However, no Option can have a term of more than fifteen years.
SECTION 10. NO RIGHTS AS A SHARE OWNER
An optionee or a transferee of an optionee pursuant to Section 8 shall have
no right as a share owner with respect to any DVUI Common Stock covered by an
Option or receivable upon the exercise of an Option until the optionee or
transferee shall have become the holder of record of such DVUI Common Stock, and
no adjustments shall be made for dividends in cash or other property or other
distributions or rights in respect to such DVUI Common Stock for which the
record date is prior to the date on which the optionee or transferee shall have
in fact become the holder of record of the share of DVUI Common Stock acquired
pursuant to the Option.
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SECTION 11. ADJUSTMENT IN THE NUMBER OF SHARES AND IN OPTION PRICE
In the event there is any change in the shares of DVUI Common Stock through
the declaration of stock dividends, or stock splits or through recapitalization
or merger or consolidation or combination of shares or spin-offs or otherwise,
the Board shall make such adjustment, if any, as it may deem appropriate in the
number of shares of DVUI Common Stock available for Options as well as the
number of shares of DVUI Common Stock subject to any outstanding Option and the
option price thereof. Any such adjustment may provide for the elimination of any
fractional shares which might otherwise become subject to any Option without
payment therefor.
SECTION 12. AMENDMENTS, MODIFICATIONS AND TERMINATION OF THE PLAN
The Board may terminate the Plan at any time. From time to time, the Board
may suspend the Plan, in whole or in part. From time to time, the Board may
amend the Plan, in whole or in part, including the adoption of amendments deemed
necessary or desirable to qualify the Options under the laws of various
countries (including tax laws) and under rules and regulations promulgated by
the Securities and Exchange Commission with respect to employees who are subject
to the provisions of Section 16 of the 1934 Act, or to correct any defect or
supply an omission or reconcile any inconsistency in the Plan or in any Option
granted thereunder, or for any other purpose or to any effect permitted by
applicable laws and regulations, without the approval of the share owners of the
Company. However, in no event may additional shares of DVUI Common Stock be
allocated to the Plan or any outstanding option be repriced or replaced without
share-owner approval. Without limiting the foregoing, the Board of Directors may
make amendments applicable or inapplicable only to participants who are subject
to Section 16 of the 1934 Act.
No amendment or termination or modification of the Plan shall in any manner
affect any Option theretofore granted without the consent of the optionee,
except that the Board may amend or modify the Plan in a manner that does affect
Options theretofore granted upon a finding by the Board that such amendment or
modification is in the best interest of holders of outstanding Options affected
thereby. Grants of ISOs may be made under this Plan until November 15, 2009 or
such earlier date as this Plan is terminated, and grants of NSOs may be made
until all of the 1,500,000 shares of DVUI Common Stock authorized for issuance
hereunder (adjusted as provided in Sections 5 and 11) have been issued or until
this Plan is terminated, whichever first occurs. The Plan shall terminate when
there are no longer Options outstanding under the Plan, unless earlier
terminated by the Board.
SECTION 13. GOVERNING LAW
The Plan and all determinations made and actions taken pursuant thereto
shall be governed by the laws of the State of Arizona and construed in
accordance therewith.
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