Exhibit 5.2
MESA AIR GROUP, INC.
2001 KEY OFFICER STOCK OPTION PLAN
1. PURPOSE OF THE PLAN; TYPE OF PLAN
(a) Establishment and General Purpose. Mesa Air Group, Inc. (the
"Company") hereby establishes the 2001 Key Officer Stock Option
Plan (the "Plan"). The purpose of the Plan is to compensate the
chief executive officer of the Company ("CEO") and the president and
chief operating officer of the Company ("COO," together with the
CEO, the "Key Officers") with stock options ("Options") to induce
their entry into employment agreements (as to each, their
"Employment Agreement") or otherwise to induce them to remain as
employees of the Company, and in either event to provide an
incentive for them to improve the Company's performance. Without the
Plan, the Board does not believe it can attract and retain the
caliber of officers necessary to operate the Company in today's
competitive environment. An extremely competitive market currently
exists for senior executive officers and valuable stock options
owned by senior management of competitors of the Company make a
generous stock option plan necessary to attract and retain officers.
(b) Designation of Stock Options as Non-Qualified Stock Options. Options
granted under the Plan shall not be treated as incentive stock
options under Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
2. ADMINISTRATION OF THE PLAN
(a) Creation of the Committee. This Plan will be administered by a
committee of persons (hereinafter, the "Committee") as chosen by the
Board of Directors of the Company (the "Board"). The Committee will
generally consist of one or more members of the Board. If a
Committee does not exist, or for any other reason determined by the
board, the Board may take any action under the Plan that otherwise
would be the responsibility of the Committee.
(b) Composition of Committee. With respect to Options granted to a
person subject to Rule 16b-3 of the Securities Exchange Act of 1934
or any successor rule ("Rule 16b-3"), unless otherwise determined by
the Board, the Committee granting such Options shall be the entire
Board or shall be comprised solely of two or more "non-employee
directors" as defined by Rule 16b-3. With respect to Options granted
to a "covered employee" under Section 162(m) of the Code ("Section
162(m)"), unless otherwise determined by the Board, the Committee
granting such Options shall be comprised solely of two or more
"outside directors" as defined by Section 162(m). With respect to
Options granted to a person subject to both Rule 16b-3 and Section
162(m), unless otherwise determined by the Board, all grants will be
made in a manner that complies with
both Rule 16b-3 and Section 162(m). The Committee shall be so
constituted at all times as to permit the Plan to comply with Rule
16b-3 or any successor rule.
(c) Power and Authority of Committee. The Committee will have authority
and discretion to interpret the Plan, to establish, amend, and
rescind any rules and regulations relating to the Plan, to decide
all questions and settle all controversies and disputes which may
arise in connection with the Plan, and to make all other
determinations that may be necessary or advisable for the
administration of the Plan.
3. STOCK AND MAXIMUM NUMBER OF SHARES SUBJECT TO PLAN
(a) Description of Stock and Maximum Shares Allocated. The stock subject
to the provisions of this Plan and issuable upon exercise of the
Options are shares of the Company's common stock ("Common Stock"),
no par value, which may be either unissued or treasury shares, as
the Board may from time to time determine. Subject to adjustment as
provided in Section 7, the aggregate number of shares of Common
Stock covered by the Plan issuable upon exercise of all Options
shall be 2,000,000 shares, which shares shall be reserved for
issuance upon the exercise of the Options. The maximum number of
shares that will be subject to Options granted under the Plan to any
Key Officer during any calendar year will be as set forth in Section
4(b)(i) and (ii), subject to adjustment as described in Section 7.
(The shares available for Options under this Plan and all other
shares of Common Stock of the Company shall be referred to herein as
the "Shares.") If the exercise price of any Option is satisfied by
tendering Shares to the Company, only that number of Shares issued
net of the Shares tendered shall be considered issued and delivered
for purposes of determining the maximum number of Shares available
for issuance under this Section.
(b) Restoration of Unpurchased Shares. If an Option expires or
terminates for any reason prior to its exercise in full before the
term of the Plan expires, the Shares subject to, but not issued
under, such Option shall again be available for other Options
hereafter granted.
4. OPERATION OF THE PLAN
(a) Plan Participants. Options shall be granted to the Key Officers.
(b) Date of Grants and Allotment.
(i) CEO. One hundred and fifty thousand (150,000) Options shall
be granted to the CEO on April 1, 2002, and on April 1 of each
successive calendar year in which the CEO's Employment
Agreement remains in effect. The
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grant of any Options to the CEO in excess of such number of
Options will require the approval of the Committee.
(ii) COO. One hundred thousand (100,000) Options shall be granted
to the COO on January 1, 2002, and on January 1 of each
successive calendar year in which the COO's Employment
Agreement remains in effect. The grant of any Options to the
COO in excess of such number of Options will require the
approval of the Committee.
(iii) If a scheduled Grant Date in any given year fall on a day on
which trading in the Shares is closed, the action which would
have taken place on such Grant Date shall be delayed until the
first day after the scheduled Grant Date that trading in the
Shares commences.
(iv) Each of the dates on which Options are granted under this
Section 4(b) shall be referred to herein as a "Grant Date."
(c) Price. The Option price per Share shall be equal to the fair market value
of the underlying Shares on the Grant Date, as determined under Section
4(d) below.
(d) Fair Market Value. The fair market value of Shares underlying Options
granted on any particular Grant Date shall be determined as follows:
(i) If the Shares are listed or admitted to trading on any securities
exchange, the fair market value shall be the average sales price on
such day on the New York Stock Exchange, or if the Shares have not
been listed or admitted to trading on the New York Stock Exchange,
on such other securities exchange on which such stock is then listed
or admitted to trading, or if no sale takes place on such day on any
such exchange, the average of the closing bid and asked price on
such day as officially quoted on any such exchange;
(ii) If the Shares are not then listed or admitted to trading on any
securities exchange, the fair market value shall be the average
sales price on such day or, if no sale takes place on such day, the
average of the reported closing bid and asked price on such date, in
the over-the-counter market as furnished by the National A-2 39
Association of Securities Dealers Automated Quotation ("NASDAQ"), or
if NASDAQ at the time is not engaged in the business of reporting
such prices, as furnished by any similar firm then engaged in such
business and selected by the Committee; or
(iii) If the Shares are not then listed or admitted to trading in the
over-the-counter market, the fair market value shall be the amount
determined by the Committee in a manner consistent with Treasury
Regulation Section
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20.203 l-2 promulgated under the Code or in such other manner
prescribed by the Secretary of the Treasury or the Internal Revenue
Service.
(e) Duration of Plan; Term of Options. The term of the Plan, unless
previously terminated by the Board, is five years. The Board may
suspend or terminate the Plan at any time. No Option shall be
granted under the Plan unless granted within five years after the
adoption of the Plan by the Board, but Options outstanding on the
date the Plan terminates shall not be terminated or otherwise
affected by virtue of the Plan's expiration. Except as otherwise
indicated in Section 6, all Options automatically expire ten years
from the Grant Date.
(f) Vesting of the Options. Subject to Section 6, one-third of the
Options granted on a Grant Date shall vest on the first
anniversary after the Grant Date; one-third of the Options granted
on a Grant Date shall vest on the second anniversary after the Grant
Date; and the remaining one-third of Options granted on a Grant Date
shall vest on the third anniversary after the Grant Date.
5. TERMS AND CONDITIONS OF OPTIONS
(a) Individual Agreements. Options granted under the Plan shall be
evidenced by agreements in such form as the Board or the Committee
from time to time approves, which agreements shall substantially
comply with and be subject to the terms of the Plan.
(b) Required Provisions. Each agreement shall state:
(i) the total number of Shares to which it pertains;
(ii) the exercise price for the Shares covered by the Option;
(iii) the time at which the Option becomes exercisable;
(iv) the scheduled expiration date of the Option; and
(v) the timing and conditions of issuance of any Option exercise.
(c) No Fractional Shares. Options shall be granted and shall be
exercisable only for whole Shares; no tractional Shares will be
issuable upon exercise of any Option granted under the Plan.
Fractional Options shall be rounded down to the nearest whole Share
number.
(d) Method of Exercising Options. Options shall be exercised by written
notice to the Company, addressed to the Company at its principal
place of business. Such notice shall state the election to exercise
the Option and the number of Shares
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with respect to which it is being exercised, and shall be signed by
the person exercising the Option. Such notice shall be accompanied
by payment in full of the exercise price for the number of Shares
being purchased. Payment may be by any of the following methods or
any combination of the following methods:
(i) in cash;
(ii) by bank cashier's check;
(iii) pursuant to a loan from the Company if the Board so determines
or if the Key Officer's Employment Agreement so provides;
(iv) by delivery to the Company of certificates representing the
number of Shares then owned by the Key Officer, the fair
market value of which (as determined under Section 4(d))
equals the purchase price of the Shares purchased pursuant to
the Option, properly endorsed for transfer to the Company, but
Shares used for this purpose must have been held by the Key
Officer for at least six months, or for such other minimum
period as may be established from time to time by the
Committee; or
(v) with the surrender of vested Options which have a "spread"
equal to the amount of payment (with the spread to be
determined by the difference between the fair market value of
the common stock that is subject to the Option that is being
surrendered, as determined in Section 3(d) of the Plan, and
the exercise price of the Option being surrendered).
The Company shall deliver a certificate or certificates representing
the Option Shares to the purchaser as soon as practicable after
payment for those Shares has been received. If an Option is
exercised by any person other than the Option holder, such notice
shall be accompanied by appropriate proof of the right of such
person to exercise the Option. All Shares that are purchased and
paid for in full upon the exercise of an Option shall be fully paid
and non-assessable.
(e) No Rights of a Shareholder. A Key Officer shall have no rights as
a shareholder with respect to Shares covered by an Option until such
Option is exercised and a certificate for the underlying Shares is
issued. Upon such exercise of an Option and issuance of a stock
certificate, the holder of the Shares of Common Stock so received
shall have all the rights of a shareholder of the Company. No
adjustment will be made for cash dividends for which the record date
is prior to the date a stock certificate is issued upon exercise of
an Option.
(f) Registration Rights. Each grant of Options pursuant to this Plan
shall be subject to the requirement that, if at any time counsel to
the Company shall determine that the listing, registration or
qualification of the Shares subject to such Option upon
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any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, is
necessary as a condition of, or in connection with, the issuance or
purchase of Shares thereunder, such Option may not be exercised in
whole or in part unless such listing, registration, qualification,
consent or approval have been effected or obtained on conditions
acceptable to the Committee. Notwithstanding the foregoing, the
Company agrees: (i) to keep in effect a registration statement under
the Securities Act of 1933, as amended (or any successor statute)
(the "1933 Act") with respect to the Shares underlying the Options
for as long as any of the Options remain unexercised; (ii) to keep
in effect a registration statement under the 1933 Act with respect
to the resale of any such Shares, to the extent necessary to permit
the Key Officer or any transferee of the Key Officer's Shares
(acquired pursuant to an Option) to resell such Shares without any
restrictions on the resale of such Shares under the 1933 Act; (iii)
to comply with any registration or similar requirements under the
laws of any state to the extent necessary to permit the Key Officer
or any transferee of the Key Officer with respect to such Shares to
resell such Shares without any restrictions on the resale of such
Shares under such laws and regulations; (iv) to comply with all
state and federal laws and regulations regarding disclosure, so as
to permit the Key Officer and any transferee of the Key Officer to
resell the Shares underlying the Options without liability under
such laws and regulations; and (v) to cause all Shares underlying
any Option to be listed or admitted to trading on any securities
exchange on which the Shares have been listed or admitted to
trading, at the time any Option is exercised.
6. TERMINATION OF EMPLOYMENT; ASSIGNABILITY; DEATH
(a) Termination of Employment. Except as more specifically provided in
Section 6(b), (c), (d) or (e), below, if any Key Officer ceases to
be an employee of the Company prior to March 14,2004 (in the case of
Ornstein) or January 1,2004 (in the case of Lotz), such Key Officer
may, within three months after the date of such Key Officer's
termination of employment (but not after the stated expiration date
of an Option), exercise any Option that has become vested prior to
the date of such termination. If any Key Officer is employed by the
Company for the period beginning with the date this Plan is approved
by the Board and ending on March 13,2004 (in the case of Ornstein)
or December 3 1,2003 (in the case of Lotz), and thereafter ceases to
be an employee of the Company, the expiration date for exercise of
the Options held by such Key Employee shall not be earlier than ten
years from the Grant Date.
(b) Disability. If the Key Officer is removed as an employee of the
Company due to Disability (as defined in such Key Officer's
Employment Agreement), any unvested Option shall become fully vested
and the Key Officer (or his representative) may exercise the
Options, in whole or in part, at any time prior to
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the stated expiration date of the Options, and if such removal
occurs prior to March 14, 2004 (in the case of Ornstein) or January
1, 2004 (in the case of Lotz), the expiration date for exercise of
the Options shall not be earlier than ten years from the Grant Date.
(c) Discharge for Cause. If a Key Officer is removed as an employee of
the Company for Cause (as such term is defined in such Key Officer's
Employment Agreement), the Options shall terminate upon the
effective date of the removal. Notwithstanding the foregoing, if
such Key Officer is employed by the Company for the period beginning
with the date this Plan is approved by the Board and ending on March
13, 2004 (in the case of Ornstein) or December 31, 2003 (in the
case of Lotz), such Key Officer may exercise the Options, in whole
or in part, to the extent they were exercisable on the date when the
Key Officer's removal was effective, at any time prior to the tenth
anniversary of the Grant Date of the Options.
(d) Termination Without Cause or For Good Reason. If a Key Officer
is terminated by the Company without Cause (as such term is defined
in such Key Officer's Employment Agreement) or if the Key Officer
terminates employment for Good Reason (as such term is defined in
such Key Officer's Employment Agreement), any unvested Option held
by such Key Officer shall vest immediately, and such Key Officer
shall have until the stated expiration date of any Options to
exercise them, but if such termination occurs prior to March 14,
2004 (in the case of Ornstein) or January 1, 2004 (in the case of
Lotz), the expiration date for exercise of the Options shall not be
earlier than ten years from the Grant Date.
(e) Death of Option Holder. If a Key Officer dies while serving as an
employee of the Company, any unvested Option held by such Key
Officer shall become fully vested and shall be exercisable until the
stated expiration date thereof by the person or persons
("successors") to whom such Key Officer's rights pass under will or
by the laws of descent and distribution, but if the Key Officer's
death occurs prior to March 14,2004 (in the case of Ornstein) or
January 1, 2004 (in the case of Lotz), the expiration date for
exercise of the Options shall not be earlier than ten years from the
Grant Date. An Option may be exercised (and payment of the Option
price made in full) by the successors only after written notice to
the Company, specifying the number of shares to be purchased. Such
notice shall comply with the provisions of Section 5(f).
(f) Assignability. No Option or the privileges conferred thereby shall
be assignable or transferable by a holder except:
(i) by will or the laws of descent and distribution;
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(ii) to an immediate family member (which for this purpose is
defined as a spouse, a child by blood or adoption, a
grandchild by blood or adoption, and any trust, partnership,
limited liability company, or other entity whose primary
beneficiaries include one or more of any such immediate family
members) of the Key Officer holding such Option; or
(iii) to an organization exempt from Federal income tax under
Section 501(c)(3) or Section 501(c)(4) of the Code.
(g) The provisions of this Section 6 shall be subject to call rights
with respect to the Options, if any, that are set forth in the Key
Officer's Employment Agreement or in any other agreement between the
Key Officer and the Company.
7. CERTAIN ADJUSTMENTS
The aggregate number of Shares subject to the Plan, the number of Shares
covered by outstanding Options, and the price per share stated in such Options
shall be proportionately adjusted for any increase or decrease in the number of
outstanding Shares of Common Stock of the Company resulting from a subdivision
or consolidation of Shares or any other capital adjustment or from the payment
of a stock dividend or from any other increase or decrease in the number of such
Shares effected without receipt by the Company of consideration therefor in
money, services or property.
8. COMPLIANCE WITH LEGAL REQUIREMENTS
(a) Registration Statement Preparation. The Key Officer hereby agrees to
supply the Company with such information and to cooperate with the
Company, as the Company may reasonably request, in connection with
the preparation and filing of the registration statements and
amendments thereto under the 1933 Act and applicable state statutes
and regulations applicable to the Option Shares.
(b) Additional Restrictions on Option Exercise. Notwithstanding any
provision to the contrary contained herein, a Key Officer may
exercise Options only so long as such exercise does not violate the
law or any rule or regulation adopted by any applicable governmental
authority.
9. MISCELLANEOUS
(a) No Funding. This Plan shall be unfunded. The Company shall not be
required to establish any special or separate fund or to make any
other segregation of assets to assure any payment under the Plan.
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(b) Nevada Law. The Plan and the Options granted thereunder shall be
governed by the laws of the State of Nevada.
(c) Withholding of Taxes. The Company's obligation to issue Shares upon
the exercise of an Option shall be subject to the Key Officer's
satisfaction of all applicable federal, state, and local income and
other tax withholding requirements. For these purposes, the Company
shall have the right to deduct from any other compensation of the
Key Officer any such taxes (including FICA taxes) required by law to
be withheld with respect to the granting or exercise of any Options.
At the time an Option is exercised by a Key Officer, the Committee,
in its sole discretion, may permit the Key Officer to satisfy such
withholding obligations by transferring previously-owned Shares to
the Company, or by directing the Company to withhold from Shares
otherwise issuable to such Key Officer upon the exercise of the
Option. For these purposes, the value of Shares would be determined
under Section 3(d) on the date that the amount of tax to be withheld
is to be determined.
(d) Other Employee Benefits. The amount of any compensation deemed to be
received by a Key Officer as a result of the exercise or grant of
any Options shall not constitute "earnings" with respect to which
any other employee benefits of such Key Officer are determined,
including without limitation benefits under any pension, profit
sharing, life insurance or salary continuation plan.
DATED to be effective as of October 30, 2001.
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MESA AIR GROUP, INC.
By: /s/ Jonathan Ornstein
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Jonathan Ornstein
Chairman of the Board
ATTESTED BY:
By: /s/ Brian S. Gillman
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Brian S. Gillman
Secretary
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