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EXHIBIT 4.9
1996 HARISTON CORPORATION
STOCK OPTION PLAN NO. 2
(Effective as of August 16, 1996)
1. NAME, PURPOSE AND TERM OF PLAN
1.1 The stock option plan constituted hereby shall be known as the 1996
Hariston Corporation Stock Option Plan No. 2.
1.2 The purpose of the Plan is to provide an incentive to officers,
consultants, and employees for continuing beneficial service to the
Company and its affiliates by encouraging and facilitating the
acquisition and ownership of common shares of the Company.
1.3 The Plan shall become effective as of the date set forth above (the
"Effective Date"). Except with respect to options then outstanding,
if not sooner terminated under Section 16.1, the Plan shall
terminate upon, and no further options shall be granted after, the
expiration of ten years from the Effective Date.
2. INTERPRETATION
In this Plan, unless the context otherwise requires:
2.1 "Board of Directors" means the Board of Directors of the Company.
2.2 "Code" means the Internal Revenue Code of 1986, as amended.
2.2 "Committee" means a committee of the Board of Directors appointed by
the Board of Directors as contemplated in subsection 4.2.
2.3 "Company" means Hariston Corporation and any successor or continuing
company resulting from the amalgamation of the Company and any other
company or resulting from any other form of corporate
reorganization.
2.4 "Employee" means an individual who is an officer, director,
consultant, or a bona fide full-time salaried employee of the
Company or any of its Subsidiaries or of any partnership of such
corporations or companies.
2.5 "Incentive Stock Options" means "incentive stock options" as set
forth in Section 422(b) of the Code.
2.6 "ISO Expiration Date" means the date determined by the Committee
after which an Incentive Stock Option granted hereunder is no longer
exercisable.
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2.7 "Market Price" means the average price per Share computed on the
basis of the closing market price for board lots of the Shares
(which shall be deemed to be the mean of the closing bid and ask
prices of the Shares, on any day on which the Shares are not traded)
on the Nasdaq for the most recent twenty (20) trading days preceding
the date on which an Option is granted.
2.8 "Nonqualified Options" mean options granted hereunder, other than
Incentive Stock Options.
2.9 "Option" means any option granted pursuant to the Plan and evidenced
by an agreement in such form and not inconsistent with the Plan as
the President shall approve from time to time.
2.10 "Optionee" means an Employee who has been granted an Option.
2.11 "Option Price" means the price at which Optioned Shares may be
subscribed for pursuant to an Option as determined pursuant to
Section 6 (Option Price).
2.12 "Optioned Shares" means the Shares subject to an Option or Options
as the case may be.
2.13 "Plan" means the Stock Option Plan as embodied herein and as from
time to time amended in accordance with the provisions hereof, and
the guidelines, rules and regulations from time to time in effect
hereunder.
2.14 "Shares" means common shares without par value in the capital of the
Company, as constituted at the effective date hereof.
2.15 "Subsidiary" means any corporation or company of which outstanding
securities to which are attached more than 50% of the votes that may
be cast to elect directors thereof are held (provided that such
votes are sufficient to elect a majority of such directors), other
than by way of security only, by or for the benefit of the Company
and/or by or for the benefit of any other corporation or company in
like relation to the Company, and includes any corporation or
company in like relation to a Subsidiary.
2.16 "10% Eligible Employees" means an Employee who, at the time an
Incentive Stock Option is granted hereunder, owns more than 10% of
the total combined voting power of all classes of stock of the
Company or any subsidiary corporation, within the meaning of Section
422(b)(6) of the Code.
2.17 The masculine gender shall include the feminine gender and the
singular shall include the plural and vice versa.
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2.18 A reference to a section includes all subsections in that section.
3. SHARES SUBJECT TO THE PLAN
Subject to adjustment in accordance with the provisions of Section
15 (Changes in Capitalization or Number of Outstanding Shares), the
maximum number of Shares which may be reserved for issuance under
the Plan shall be Two Million (2,000,000).
4. GRANT OF OPTIONS AND ADMINISTRATION OF THE PLAN
4.1 Persons eligible to receive grants of Options under the Plan shall
be limited to Employees.
4.2 This Plan will be administered by the Board or a committee of the
Board duly appointed for this purpose by the Board and consisting of
not less than three directors, a majority of whom shall be
nonemployee directors of the Company within the meaning of Rule
16b-3. If a committee is appointed for this purpose, all references
to the term "Board of Directors," other than in this subsection 4.2
and subsection 4.3.6, will be deemed to be references to the
Committee.
4.3 Subject only to the express provisions of the Plan, the Board of
Directors shall have, and hereby is specifically granted, the sole
authority:
4.3.1 to grant Options to Employees and to determine the
terms of, and the limitations, restrictions and
conditions upon, such grants;
4.3.2 to specify whether Options granted hereunder are
Incentive Stock Options or Nonqualified Options;
4.3.3 to authorize any officer or officers to execute and
deliver any option agreement, notice or document and
to do any other act as contemplated by the terms of
the Plan for and on behalf of the Company;
4.3.4 to interpret the Plan and to adapt, amend and rescind
such administrative guidelines and other rules and
regulations relating to the Plan as it may from time
to time deem advisable;
4.3.5 to make all other determinations and perform all such
other actions as the Board of Directors deems
necessary or advisable to implement and administer the
Plan; and
4.3.6 to appoint a Committee to make recommendations to the
Board of Directors regarding the grant of Options to
specified Employees, and to delegate to
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such Committee on such terms as the Board of Directors
in its discretion determines all or any part of the
powers and authority of the Board of Directors
hereunder to implement and administer the Plan.
4.3.7 with the consent of the affected holders of options,
to reprice any outstanding options under the Plan,
and/or to cancel any outstanding options under the
Plan and to grant in substitution therefor new options
under the Plan pursuant to terms consistent therewith,
covering the same or different numbers of shares of
stock, provided, however, that no Incentive Stock
Option shall be repriced or regranted on terms that
would constitute a "modification" within the meaning
of Section 424(h)(3) of the Code which would
disqualify such option as an Incentive Stock Option
described in Section 422 of the Code unless the
Company and the holder of such option shall so agree.
4.4 The determinations of the Board of Directors under the Plan
(including, without limitation, determinations of the Employees who
are to receive grants of Options and the amount and timing of such
grants), need not be uniform and may be made by it selectively among
Employees who receive, or are eligible to receive, grants of Options
under the Plan, whether or not such Employees are similarly situated
as to office, length of service, salary or any other factor. The
Board of Directors may, in its discretion, authorize the granting of
additional Options to an Optionee before an existing Option has
terminated.
4.5 All guidelines, rules, regulations, decisions and interpretations of
the Board of Directors respecting the Plan or Options shall be
binding and conclusive on the Company and on all Optionees and their
respective legal personal representatives, heirs and legatees and on
all Employees.
5. TERM OF OPTIONS
Each Option shall be for the term determined by the Board of
Directors, but in no case shall an Option be granted by the Board of
Directors for a term of longer than seven years from the date of the
granting of the Option.
6. OPTION PRICE
The Option Price in any Option shall be determined from time to time
by the Board of Directors but shall not be less than 85% of the
Market Price on the date on which the Option is granted for
Nonqualified Options, and not less than the
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Market Price on the date on which the Option is granted, for
Incentive Stock Options.
7. EXERCISE OF OPTIONS
7.1 Subject to the provisions of subsection 7.5 and of Sections 11 (No
Fractional Shares), 12 (Death or Retirement of Optionee), 13
(Termination of Employment of Optionee) and 15 (Changes in
Capitalization or Number of Outstanding Shares), the terms for
exercise of each Option shall be determined by the Board of
Directors.
7.2 An Option may be exercised by the Optionee or his personal
representatives, heirs or legatees at the applicable times and in
the applicable amounts by giving to the Company at its principal
executive office written notice of exercise specifying the number of
Shares to be subscribed for. Such notice must be accompanied by
full payment for the Shares to be subscribed for. Upon any such
exercise of an Option, the Company shall forthwith cause the
transfer agent and the registrar of the Company for the time being
to deliver to the Optionee or his personal representatives, heirs or
legatees (or as the Optionee or his personal representatives, heirs
or legatees may otherwise direct in the written notice of exercise)
a certificate or certificates in the name of the Optionee or his
personal representatives, heirs or legatees (or as otherwise
directed in the written notice of exercise) representing in the
aggregate such number of Shares as the Optionee or his personal
representatives, heirs or legatees shall have then paid for.
7.3 All Shares subscribed for under an Option shall be paid for in full
at the time of subscription.
7.4 Except as provided in Sections 8.2, 10 (Non-Transferability of
Options), 12 (Death or Retirement of Optionee) and 13 (Termination
of Employment of Optionee), no Option may be exercised in whole or
in part at any time unless at the time of such exercise the Optionee
is an Employee.
7.5 Notwithstanding any other provision of the Plan, the Board of
Directors may at any time, by notice in writing to all Optionees
under the Plan in connection with (i) any proposed sale or
conveyance of all or substantially all of the property and assets of
the Company, (ii) any proposed consolidation, amalgamation or other
form of corporate reorganization of the Company, other than
emigration of the Company to a foreign jurisdiction in which the
options of the surviving company are not exchanged on a pro-rata
basis for options held, or (iii) any proposed offer by any person to
acquire or redeem all the outstanding voting or equity securities of
any class of the Company (in each case, a "Proposed Transaction"),
require each Optionee to elect
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either to, within such period as the Board of Directors shall
prescribe,
7.5.1 subscribe and pay for a part or the whole of the
Optioned Shares then remaining unsubscribed for under
his Option (whether or not such Option would otherwise
then be exercisable), or to accept termination of his
Option in the event of his failing within such period
to either subscribe and pay for all such remaining
Optional Shares to elect to accept payment under
subsection 7.5.2 or subsection 7.5.3, as the case may
be;
7.5.2 subject to subsection 7.6, accept payment in cash in
respect of a part or the whole of the Optioned Shares
then remaining unsubscribed for under his Option
(whether or not such Option would otherwise then be
exercisable) of an amount equal to the result obtained
by multiplying the excess, if any, of the higher of
(i) the Market Price of the Shares on the date notice
is given under this subsection 7.5 or (ii) the Market
Price of the Shares on the date of completion of the
Proposed Transaction, over the Option Price, by the
number of Optioned Shares then remaining unsubscribed
for under such Option (whether or not such Option
would otherwise then be exercisable), or
7.5.3 subject to subsection 7.6, if the Option Price for a
part or the whole of the Optioned Shares exceeds the
Market Price of the Shares on both the date notice is
given under this subsection 7.5 and on the date of
completion of the Proposed Transaction, accept payment
of a total of $1 in respect of all rights to such
Optioned Shares,
provided that if a Proposed Transaction in respect of which a notice
has been given under this subsection 7.5 has not been completed (in
the case of an offer, completed by taking up and paying for the
securities tendered) within six months after the date of such
notice, any rights in respect of Optioned Shares under such Options
which have not been exercised as contemplated in subsection 7.5.1
and in respect of which payment has not been made as contemplated in
subsections 7.5.2 or 7.5.3 shall continue in effect, exercisable in
accordance with the terms thereof as at the time immediately
preceding the giving of such notice.
For the purposes of this subsection 7.5, the term "date of
completion" means the date on which the sale, conveyance, corporate
reorganization, acquisition or redemption contemplated by the
subsection takes effect with respect to the Shares. In the event
that the Market Price of the Shares is not for any reason available
at the date of
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completion, the Board of Directors shall, in good faith and in such
manner as it considers appropriate, determine the current market
value of the Shares at that date, which shall be deemed to be the
Market Price of the Shares for the purpose of part (ii) of
subsection 7.5.2 and for subsection 7.5.3. If a Proposed
Transaction is completed, the Market Price for purposes of part (ii)
of subsection 7.5.2 and for subsection 7.5.3 shall be the same as
the value of the consideration paid for Shares under the Proposed
Transaction.
7.6 The Board of Directors may require that an Optionee who has elected
to accept payment in cash in accordance with subsection 7.5.2 or
subsection 7.5.3 in consideration for the cancellation of the
Optionee's rights in respect of the Optioned Shares remaining
unsubscribed for under his Option (whether or not such Option would
otherwise then be exercisable) shall accept such payment on a date
prior to the date of completion of the Proposed Transaction and
based on the Market Price on the date notice is given under
subsection 7.5, provided that the Company shall forthwith after
completion of the Proposed Transaction pay to each such Optionee an
amount equal to the result obtained by multiplying the excess, if
any, between (i) the Market Price of the Shares at the date of
completion of the Proposed Transaction by the number of Optioned
Shares in respect of which that Optionee previously received payment
under subsection 7.5.2 or 7.5.3 and (ii) the Market Price of the
Shares on the date notice is given under subsection 7.5.
7.7 The provisions of subsection 7.5 requiring Optionees to make an
election to exercise an Option or to accept payment in satisfaction
of an Option, shall only be invoked with respect to Optionees
generally and not with respect to one Optionee and not other
Optionees.
8. SPECIAL PROVISIONS RELATING TO INCENTIVE STOCK OPTIONS
8.1 The exercise price to be paid for each share of Common Stock
deliverable upon exercise of each Incentive Stock Option granted
hereunder shall be equal to the Market Price per share of Common
Stock at the time of grant as determined by the Committee; provided,
however, that in the case of a 10% Eligible Employee the exercise
price per share shall be at least 110% of the Market Price per share
of Common Stock at the time of grant. If there is no such reported
Market Price, the Market Price shall be deemed to be the fair market
value as determined by the Committee in its sole discretion.
8.2 Incentive Stock Options shall be in such form as the Committee may
from time to time approve, shall be subject to the following terms
and conditions and may contain such
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additional terms and conditions, not inconsistent with this Section
8, as the Committee shall deem desirable:
8.2.1 No Incentive Stock Option shall be exercisable with
respect to any of the shares subject to such Incentive
Stock Option later than the ISO Expiration Date, which
shall be no later than ten years after the date of
grant; provided, however, that in the case of any 10%
Eligible Employee, the ISO Expiration Date of any
Incentive Stock Option granted thereto shall not be
later than five years after the date of such grant.
To the extent not prohibited by other provisions of
the Plan, each Incentive Stock Option shall be
exercisable at such time or times as the Committee in
its discretion may determine at or prior to the time
such Incentive Stock Option is granted. In the event
the Committee makes no such determination, each
Incentive Stock Option shall be exercisable from time
to time, in whole or in part, subject to the monetary
limitations set forth in Section 8.3, at any time
prior to the ISO Expiration Date.
8.2.2 For purposes of this Section 8, and each Incentive
Stock Option granted hereunder, an Employee's
employment shall be deemed to have terminated at the
close of business on the day preceding the first date
on which such Employee is no longer for any reason
whatsoever (including the death of such Employee)
employed by the Company or a subsidiary of the
Company. An Employee shall be considered to be in the
employment of the Company or a subsidiary of the
Company as long as such Employee remains an employee
of the Company or a subsidiary of the Company, whether
active or on any authorized leave of absence. Any
question as to whether and when there has been a
termination of such employment, and the cause of such
termination, shall be determined by the Committee and
its determination shall be final and conclusive. If
an Employee's employment is terminated for any reason
whatsoever (including the death of such Employee),
each Incentive Stock Option thereunto granted
hereunder and all rights thereunder shall wholly and
completely terminate as follows:
(a) With respect to Incentive Stock
Options not then exercisable, at the time the
Employee's employment is terminated; and
(b) With respect to Incentive Stock
Options then exercisable:
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(1) At the time the Employee's
employment is terminated if his employment is
terminated because he is discharged for fraud, theft
or embezzlement committed against the Company or a
subsidiary, affiliated entity or customer of the
Company, or for conflict of interest (other than
legitimate competition); or
(2) At the expiration of a period
of one year after the Employee's death (but in no
event later than the ISO Expiration Date) if the
Employee's employment is terminated by reason of his
death. An Incentive Stock Option may be exercised by
the Employee's estate or by the person or persons who
acquire the right to exercise such Incentive Stock
Option by bequest or inheritance; or
(3) At the expiration of a period
of three years (but in no event later than the ISO
Expiration Date) after the Employee's employment is
terminated if the Employee's employment has terminated
because of retirement or disability ; or
(4) At the expiration of a period
of three months after the Employee's employment is
terminated (but in no event later than the ISO
Expiration Date) if the Employee's employment is
terminated for any reason other than the reasons
specified in subsections 8.2(b)(1)-(3).
In the event and to the extent that an Incentive Stock
Option granted under this Section 8 is not exercised
(i) within three months after the Employee's
employment is terminated because of retirement or
disability not within the meaning of Section 22(e)(3)
of the Code, or (ii) within one year after the
Employee's employment is terminated because of
disability within the meaning of Section 22(e)(3) of
the Code, such option shall be taxed as a Nonqualified
Option.
8.3 Notwithstanding any other provision of the Plan, the aggregate fair
market value (determined as of the time an Incentive Stock Option is
granted), based upon the calculation of the exercise price as
provided in Section 8.1 of the Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by an
Employee, under all Incentive Stock Option plans of the Company and
its subsidiaries, during any calendar year cannot exceed U.S.
$100,000 or such other maximum amount permitted under Section 422(d)
of the Code. If the date on which one or more of such Incentive
Stock Options could first be exercised would be accelerated pursuant
to any provision of the Plan or any option agreement, and the
acceleration of
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such exercise date would result in a violation of the monetary
restriction set forth in the preceding sentence, then,
notwithstanding any such provision, but subject to the provisions of
the next succeeding sentence, the exercise dates of such Incentive
Stock Options shall be accelerated only to the date or dates, if
any, that do not result in a violation of such restriction and, in
such event the exercise date of the Incentive Stock Options with the
lowest option prices shall be accelerated to the earliest such
dates. The Committee may, in its discretion, authorize the
acceleration of the exercise date of one or more Incentive Stock
Options even if such acceleration would violate the monetary
restriction set forth in the first sentence of this Section 8.3 and
even if such Incentive Stock Options were thereby converted in whole
or in part to Nonqualified Options.
9. RELATED RIGHTS AND OTHER BENEFIT PLANS
9.1 No Optionee shall have any of the rights of a shareholder of the
Company with respect to any Optioned Shares until such Optioned
Shares have been issued to him upon exercise of the Option and full
payment therefor has been made by him to the Company.
9.2 Participation in the Plan shall not affect an Employee's eligibility
to participate in any other benefit or incentive plan of the
Company, its Subsidiaries or any combination or partnership thereof.
9.3 Any Option granted pursuant to this Plan shall not obligate the
Company to make any benefit available to an Employee under any other
plan of the Company unless otherwise specifically provided therein.
9.4 Nothing contained in this Plan will prevent the Company, any
Subsidiary or any combination or partnership thereof from adopting
other or additional compensation arrangements for the benefit of any
Employee, subject to any required shareholder or regulatory
approval.
10. NON-TRANSFERABILITY OF OPTIONS
No Option granted under the Plan shall be transferable otherwise
than by will or by the laws of descent and distribution. During the
lifetime of the Optionee, an Option granted under the Plan shall be
exercisable only by the Optionee. Any attempt to transfer, assign,
pledge, hypothecate or otherwise dispose of, or to subject to
execution, attachment or similar process, any option granted under
the Plan, or any right thereunder, contrary to the provisions
hereof, shall be void and ineffective, shall give no right to the
purported transferee, and shall, at the sole
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discretion of the Committee, result in forfeiture of the option with
respect to the shares involved in such attempt.
11. NO FRACTIONAL SHARES
Under no circumstances shall the Company be obligated to issue any
fractional Shares upon the exercise of an Option. To the extent
that an Optionee would otherwise have been entitled to receive on
the exercise or partial exercise of an Option a fraction of a Share
in any year, that fraction of a Share shall be added to and become
available to the Optionee upon exercise of the Option in the next
succeeding year following the anniversary of the date of grant of
the Option. To the extent that an Optionee would otherwise have
been entitled to receive on an exercise or partial exercise of an
Option a fraction of a Share or any other kind of share or
obligation as a result of a change in capitalization or number of
outstanding Shares as described in Section 15 (Change in
Capitalization or Number of Outstanding Shares), the Company shall
pay to the Optionee the current market value of such fraction
computed in a manner which the Board of Directors considers
appropriate.
12. DEATH OR RETIREMENT OF OPTIONEE
12.1 Subject to Section 8 with respect to Incentive Stock Options, in the
event of the termination of employment of an Optionee by reason of
death at any time during the term of an Option, then within 90 days
of the date of death, the Option may be exercised by the Optionee's
legal personal representative or representatives up to such maximum
number of Optioned Shares which the Optionee was entitled to
exercise at the date of his death, but in no event shall the Option
be exercisable beyond the expiration date set forth in the Option at
the time of its grant.
12.2 Subject to Section 8 with respect to Incentive Stock Options, in the
event of the termination of employment of an Optionee at any time
during the term of an Option by reason of retirement at or after the
age of 60 or after 20 years of employment by the Company, the rights
to purchase Shares under the Option which have accrued to the
Optionee and remain unexercised at, or which accrue subsequent to,
the date of his retirement shall remain exercisable by the Optionee
(or by the Optionee's legal personal representative or
representatives if the Optionee dies before the last date for
exercise of the Option) beyond that date in accordance with the
terms of the Option as if the Optionee had not retired subject to
the following:
12.2.1 in no event shall rights under the Option be
exercisable beyond the expiration date set forth in
the Option at the time of its grant;
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12.2.2 if at or after the retirement of the Employee, such
Employee has attained the age of 65, the Employee may
elect by notice given within the period of 90 days
immediately following the later of his or her 65th
birthday and the date of retirement, to exercise the
rights to purchase Shares under the Option in respect
of all or any part of the Shares subject thereto
(including rights accruing in respect of Shares during
the remainder of the term of the Option); and
12.2.3 if no election as contemplated in subsection 12.2.2 is
made, the retired Employee may thereafter exercise
rights to purchase Shares under the Option which have
accrued and remain unexercised from time to time in
accordance with the terms of the Option as if the
Employee had not retired.
13. TERMINATION OF EMPLOYMENT OF OPTIONEE
13.1 Except as set forth in Section 8.2, in the event of the termination
of employment of an Optionee for any reason other than as specified
in Section 12 (Death or Retirement of Optionee), the rights to
purchase Shares under the Option which have accrued to the Optionee
and remain unexercised at the date of termination of his employment
shall be exercisable by the Optionee within a period of ninety days
from the date of such termination as to all or any part of such
Shares, but in no event later than the expiration date set forth in
the Option at the time of its grant, and thereafter all such rights
shall terminate.
13.2 Nothing contained in the Plan or any Option shall confer on any
Optionee any right to, or guarantee of, continued employment by the
Company or any Subsidiary or any combination or partnership thereof,
or in any way limit the right of the Company or a Subsidiary or any
combination or partnership thereof to terminate the employment of
the Optionee at any time.
14. SHARES RELEASED FROM OPTIONS
Any Shares released from an Option by the provisions of Sections 12
(Death or Retirement of Optionee) or 13 (Termination of Employment
of Optionee) may be made the subject of further Option or Options.
15. CHANGE IN CAPITALIZATION OR NUMBER OF OUTSTANDING SHARES
15.1 If, and whenever, prior to the issuance by the Company of all the
Optioned Shares under an Option, the Shares are from time to time
consolidated into a lesser number of Shares or subdivided into a
greater number of Shares, the number of Optioned Shares remaining
unissued under the Option shall be
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decreased or increased proportionately, as the case may be, and the
subscription price to be paid by the Optionee for each such Share
shall be adjusted accordingly.
15.2 Subject to subsection 7.5, if the Company enters into, and is
continued or survives as a result of, any amalgamation or merger
with one or more other companies or corporations whether by way of
arrangement, by the sale of its assets and undertaking or otherwise,
then and in each such case each Option shall extend to and cover the
number, class and kind of shares or other obligations to which the
Optionee would have been entitled had the Option been fully
exercised immediately prior to the date such amalgamation or merger
becomes effective (whether or not such Option would otherwise then
have been fully exercisable) and the then prevailing subscription
price of the shares or other obligations so covered shall be
correspondingly adjusted if and to the extent that the Board of
Directors considers it to be equitable and appropriate.
15.3 Except as expressly provided in this Section 15, the grant of any
Option shall not in any way limit or affect the rights or powers of
the Company or its directors or shareholders to make any changes or
deal in any manner with the authorized, issued or unissued shares or
any other securities of the Company and no such change or dealing
shall give any right or entitlement to the holder of any Option in
respect or as a result thereof.
16. AMENDMENT AND TERMINATION OF THE PLAN AND OPTIONS
16.1 Subject to applicable legislation, any required regulatory or
shareholder approval and the rules of any stock exchange on which
shares in the capital of the Company are listed, the Board of
Directors may at any time terminate the Plan or make such amendments
to the Plan as it shall deem advisable provided that, except as
otherwise specifically provided by Section 15 and subsection 7.5, no
such termination or amendment shall adversely affect the rights of
any Optionee under any Option previously granted except with the
consent of such Optionee. Each such amendment of the Plan (a)
extending the period within which options may be granted under the
Plan, (b) increasing the aggregate number of shares of Common Stock
to be optioned under the Plan except as provided in the adjustment
provisions hereof, (c) materially modifying the requirements as to
eligibility of employees or consultants receiving options under, or
changing the eligibility of employees or class of employees to whom
options may be granted hereunder, (d) materially increasing the
benefits to optionees under the Plan, shall, in each case, be
subject to approval by the shareholders of the Company. The
Committee may, with the consent of the person or persons entitled to
exercise any outstanding option granted under the Plan, amend such
option; provided,
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however, that any such amendment shall be subject to shareholder
approval when required as set forth above. The Committee may at any
time or from time to time, in its discretion, in the case of any
option previously granted under the Plan which is not then
immediately exercisable in full, accelerate the time or times at
which such option may be exercised to any earlier time or times.
Any adjustment of an Incentive Stock Option pursuant to this Section
16.1 shall be made in such manner as not to constitute a
"modification" within the meaning of Section 424(h)(3) of the Code.
16.2 If the Plan is terminated, the provisions of the Plan and any
administrative guidelines and other rules and regulations adopted by
the Board of Directors and in force on the date of termination will
continue in effect as long as any Option or any rights pursuant
thereto remain outstanding and, notwithstanding the termination of
the Plan, the Board of Directors shall remain able to make such
amendments to the Plan or the Options as they would have been
entitled to make if the Plan were still in effect.
17. GENERAL REQUIREMENTS
Each grant of an Option under the Plan shall be subject to the
requirement that if at any time the Board of Directors shall
determine that any agreement, undertaking or other action or
cooperation on the part of an Optionee, including in respect to a
disposition of the Shares, is necessary or desirable as a condition
of, or in connection with (i) the listing, registration or
qualification of the Shares subject to the Plan upon any stock
exchange or under the laws of any applicable jurisdiction, or (ii)
obtaining a consent or approval of any governmental or other
regulatory body, the exercise of such Option and the issue of Shares
thereunder may be deferred in whole or in part by the Board of
Directors until such time as the agreement, undertaking or other
action or cooperation shall have been obtained in a form and on
terms acceptable to the Board of Directors.
18. RIGHT TO OPTIONS
Nothing contained herein or in any resolution previously or
hereafter adopted by the Board of Directors shall vest the right in
any person whomsoever to receive any Option. No person shall
acquire any of the rights of any Optionee unless and until a written
option agreement, in form satisfactory to the President of the
Company, shall have been duly executed on behalf of the Company and
delivered to the Optionee and executed and delivered by the Optionee
to the Company. Any agreement purporting to be an Option shall, to
the extent it may be contrary to the express provisions of the Plan,
be unenforceable by the Optionee against the Company.
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19. WITHHOLDING
Whenever the Company proposes or is required to issue or transfer
Shares pursuant to an Option, the Company shall have the right to
withhold from salary payments or to require the recipient of such
Shares to remit to the Company an amount sufficient to satisfy any
federal, provincial, state and/or local withholding tax requirements
prior to the delivery of any certificate or certificates for such
Shares. Whenever under the Plan payments are to be made in cash
such payments shall be net of an amount sufficient to satisfy any
federal, provincial, state and/or local withholding tax
requirements.
20. INTERPRETATION
Any question or interpretation of the Plan or any Option shall be
determined by the Board of Directors and such determination shall be
final and binding upon all persons.
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