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EXHIBIT 10.11
SIMULA, INC.
1992 STOCK OPTION PLAN
1. Purposes of the Plan. The purposes of this Stock Option Plan are
to attract and retain the best available personnel for positions of
responsibility within the Company, to provide additional incentive to Employees
of the Company, and to promote the success of the Company's business through the
grant to Employees, directors, and others, of options to purchase shares of the
Company's Common Stock.
Options granted hereunder may be either Incentive Stock or
Non-Statutory Stock Options, at the discretion of the Committee. The type of
options granted shall be reflected in the terms of written Stock Option
agreements.
2. Definitions. As used herein, the following definitions shall
apply:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
(c) "Common Stock" shall mean the common stock of the Company
described in the Company's Certificate of Incorporation, as amended.
(d) "Company" shall mean SIMULA, INC., an Arizona corporation, and
shall include any parent or subsidiary corporation of the Company as
defined in Sections 424(e) and (f), respectively, of the Code.
(e) "Committee" shall mean the Compensation Committee appointed by
the Board in accordance with paragraph (a) of Section 4 below to
administer the Plan.
(f) "Employee" shall mean any person, including salaried officers
and directors, employed by the Company. The payment of a director's fee
by the Company shall not be sufficient to constitute "employment" by
the Company.
(g) "Exchange Act" shall mean the Securities and Exchange Act of
1934, as amended.
(h) "Fair Market Value" shall mean, with respect to the date a
given Option is granted or exercised, the closing price of Common Stock
as listed on any public securities exchange, or, in the event the
Common Stock is not listed on any public securities exchange, such
value as determined by the Committee consistent with applicable rules
under Section 422 of the Code.
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(i) "Incentive Stock Option" shall mean an Option which is
intended to qualify as an incentive stock option within the meaning of
Section 422 of the Code.
(j) "Option" shall mean a stock option granted under the Plan.
(k) "Optioned Stock" shall mean the Common Stock subject to an
Option.
(l) "Optionee" shall mean an Employee of the Company who has been
granted one or more Options.
(m) "Non-Statutory Stock Option" shall mean an Option which is not
an Incentive Stock Option.
(n) "Parent" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
(o) "Plan" shall mean this 1992 Stock Option Plan, as amended.
(p) "Reload Option" shall mean an Option granted pursuant to
Section 9(e) hereof.
(q) "Share" shall mean a share of the Common Stock, as adjusted in
accordance with Section 10 of the Plan.
(r) "Stock Option Agreement" shall mean the written agreement
between the Company and the Optionee relating to the grant of an
Option.
(s) "Subsidiary" shall mean a "subsidiary corporation," whether
now or hereafter existing, as defined in Section 424(f) of the Code.
(t) "Tax Date" shall mean the date an Optionee is required to pay
the Company an amount with respect to tax withholding obligations in
connection with the exercise of an option.
3. Common Stock Subject to the Plan. Subject to the provisions of
Section 10 of the Plan, the maximum aggregate number of Shares which may be
optioned and sold under the Plan is three hundred sixty thousand (360,000)
Shares, as adjusted from time to time pursuant to the terms of the Plan and
applicable law. The Shares may be authorized, but unissued, or previously issued
Shares acquired by the Company and held in treasury. No fractional Shares shall
be issued and the Committee or executive officers on behalf of the Committee
shall determine the manner in which fractional Share value shall be treated.
If an Option should expire or become unexercisable for any reason
without having been exercised in full, or if an exercise pursuant to Section
8(b)(iv) results in the issuance of a reduced number of Shares in satisfaction
of an Option exercise, the Shares not issued to the Optionee covered by such
Option shall, unless the Plan shall have been terminated, be available for
future grants of Options.
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Subject to the provisions of Section 10 of the Plan, no Employee shall
be granted within any fiscal year of the Company Options which in the aggregate
cover more than five hundred thousand (500,000) Shares (the "Section 162(m)
Grant Limit").
4. Administration of the Plan.
(a) Procedure.
i) The Plan shall be administered by a Committee of the
Board consisting solely of two or more outside directors (the
"Committee"). No member of the Committee shall, during service as
an administrator, be granted or awarded options, rights, or
equity securities under the Plan or under any other plan of the
Company or its affiliates except as permitted under Section 8(d)
of the Plan or Rule 16b-3 ("Rule 16b-3") under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). A quorum of
such Committee shall consist of a majority of the members of such
Committee, or as may be otherwise provided in the Company's
bylaws. The Plan shall be administered by the Committee in
accordance with Rule 16b-3.
ii) The Committee shall continue to serve until otherwise
directed by the Board. From time to time the Board may increase
the size of the Committee and appoint additional members thereof,
remove members (with or without cause), appoint new members in
substitution therefor, and fill vacancies however caused;
provided, however, that at no time may any person serve on the
Committee if that person's membership would cause the Committee
not to satisfy the "disinterested administration" requirements of
Rule 16b-3.
(b) Powers of the Committee. Subject to the provisions of the
Plan, the Committee shall have the authority, in its discretion: (i) to
grant Incentive Stock Options and Non-Statutory Stock Options in their
discretion, or pursuant to one or more formulae; (ii) to determine,
upon review of relevant information and in accordance with Section 2 of
the Plan, the Fair Market Value of the Common Stock; (iii) to determine
the exercise price per Share of Options to be granted, which exercise
price shall be determined in accordance with Section 8(a) of the Plan;
(iv) to determine the Employees and others to whom, and the time or
times at which, Options shall be granted and the number of Shares to be
represented by each Option; (v) to interpret the Plan; (vi) to amend
the Plan to the extent that such amendment does not require the
approval of Shareholders and to prescribe, amend and rescind rules and
regulations relating to the Plan, including modifications to conform
the Plan to the requirements of the Code and state and federal
securities laws, as the same may be amended from time to time; (vii) to
determine the terms and provisions of each Option granted (which need
not be identical), including pursuant to Section 8(d) and, with the
consent of the Optionee thereof, modify or amend each Option; (viii) to
accelerate or defer (with the consent of the Optionee) the exercise
date of any Option; (ix) to authorize any person to execute on behalf
of the Company any instrument required to effectuate the grant of an
Option previously granted by the Committee; (x) to accept or reject the
election made by an Optionee pursuant to Section
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16 of the Plan; and (xi) to make all other determinations deemed
necessary or advisable for the administration of the Plan.
(c) Effect of Committee's Decision. All decisions, determinations
and interpretations of the Committee shall be final and binding on all
Optionees and any other holders of any Options granted under the Plan.
5. Eligibility.
(a) Consistent with the Plan's purposes, Options may be granted
only to persons as determined by the Committee or executive officers of
the Company on behalf of the Committee. An individual who has been
granted an Option may, if he is otherwise eligible, be granted
additional Options. Incentive Stock Options may be granted only to
those Employees who meet the requirements applicable under Section 422
of the Code.
(b) Incentive Stock Options and Non-Statutory Stock Options
granted to Employees and Directors of the Company under the Plan,
unless specifically provided otherwise in the Stock Option Agreement,
will be subject to forfeiture until such time as the Optionee has been
continuously employed by the Company for one year after the date of the
grant of the Options (or in the case of a Director, served one year
thereafter), and may not be exercised prior to such time. Reload
Options will be subject to forfeiture until such time as the Optionee
has been continuously employed by the Company for six (6) months after
the date of the grant of the Reload Options, or such greater period
specified in the Stock Option Agreement, and may not be exercised prior
to such time. At such time as the Optionee has been continuously
employed or engaged by the Company for the applicable period, the
foregoing restrictions shall lapse and the Optionee may exercise the
Options at any time otherwise consistent with the Plan and the Stock
Option Agreement. Notwithstanding the foregoing, Employees or directors
of the Company who become disabled, as described in Section 9(c), or
who die while employed by the Company or within three (3) months
thereof, may exercise immediately upon such disability or death
themselves or through their estates or heirs.
(c) To the extent that the aggregate Fair Market Value of Shares
with respect to which Incentive Stock Options granted under the Plan
and all other plans of the Company and the Parents and Subsidiaries of
the Company are exercisable for the first time by an Optionee during
any calendar year exceeds one hundred thousand dollars ($100,000), such
Options shall be treated for federal income tax purposes as
Non-Statutory Stock Options.
6. Shareholder Approval and Effective Date. This Plan was adopted and
became effective on February 26,1992 and grants may be made hereunder as of the
adoption of the Plan. No Option may be granted under the Plan after February 26,
2002 (ten (10) years from the adoption of the Plan); provided, however that the
Plan and all outstanding Options shall remain in effect until such Options have
expired or until such Options are canceled.
7. Term of Option. Unless otherwise provided in the Stock Option
Agreement, the term of each Option shall be ten (10) years from the date of
grant thereof. In no case shall the
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term of any Option exceed ten (10) years from the date of grant thereof.
Notwithstanding the above, in the case of an Incentive Stock Option granted to
an Employee who, at the time the Incentive Stock Option is granted, owns ten
percent (10%) or more of the Common Stock as such amount is calculated under
Section 422(b)(6) of the Code ("Ten Percent Shareholder"), the term of the
Incentive Stock Option shall be five (5) years from the date of grant thereof or
such shorter time as may be provided in the Stock Option Agreement.
8. Terms and Conditions.
(a) Exercise Price. The per Share exercise price for
the Shares to be issued pursuant to exercise of an Option shall be
determined by the Committee, but in the case of an Incentive Stock
Option shall be no less than one hundred percent (100%) of the Fair
Market Value per share on the date of grant, and in the case of a
Non-Statutory Stock Option shall be no less than eighty-five percent
(85%) of the Fair Market Value per share on the date of grant.
Notwithstanding the foregoing, in the case of an Incentive Stock Option
granted to an Employee who, at the time of the grant of such Incentive
Stock Option, is a Ten Percent Shareholder, the per Share exercise
price shall be no less than one hundred ten percent (110%) of the Fair
Market Value per Share on the date of grant.
(b) Payment. The price of an exercised Option and the Employee's
portion of any taxes attributable to the delivery of Common Stock under
the Plan, or portion thereof, shall be paid:
i) In United States dollars in cash or by check, bank
draft or money order payable to the order of the Company; or
ii) At the discretion of the Committee, through the
delivery of shares of Common Stock with an aggregate Fair Market
Value equal to the option price and withholding taxes, if any; or
iii) In accordance with applicable Company procedures
regarding customary "broker" or "cashless" exercises, by directing
a third party to sell Shares acquired upon exercise of the Option
and to remit to the Company a sufficient portion of the sale
proceeds to pay the entire exercise price; or
iv) In accordance with applicable Company procedures, by
reducing the number of Shares issuable upon such exercise based on
the Fair Market Value on the date of exercise; or
v) At the election of the Optionee pursuant to Section 16
and with the consent of the Committee pursuant to Section 4(b)(x),
by the Company's retention of such number of shares of Common
Stock subject to the exercised Option which have an aggregate Fair
Market Value on the exercise date equal to the Employee's portion
of the Company's aggregate federal, state, local and foreign tax
withholding and FICA and FUTA obligations with respect to income
generated by the exercise of the Option by Optionee;
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vi) At the election of the Optionee and with the consent of
the Committee, by the Company's retention of such number of shares
of Common Stock subject to the exercised Option which have an
aggregate Fair Market Value on the exercise date equal to the
Optionee's expected aggregate federal, state, local and foreign
tax liability, as determined by the Optionee and approved by the
Committee, with respect to income generated by the exercise of the
Option by the Optionee;
vii) By a combination of (i), (ii), (iii), (iv), (v) and
(vi) above; or
viii) In the manner provided in subsection (c) below.
The Committee shall determine acceptable methods for tendering
Common Stock as payment upon exercise of an Option and may impose such
limitations and prohibitions on the use of Common Stock to exercise an
Option as it deems appropriate.
(c) Financial Assistance to Optionees. The Committee may assist
Optionees in paying the exercise price of Options granted under this
Plan in the following manner:
i) The extension of a loan to the Optionee by the Company;
or
ii) Payment by the Optionee of the exercise price in
installments; or
iii) A guaranty by the Company of a loan obtained by the
Optionee from a third party.
The terms of any loans, installment payments or guarantees,
including the interest rate and terms of repayment, and collateral
requirements, if any, shall be determined by the Committee, in its sole
discretion. Subject to applicable margin requirements, any loans,
installment payments or guarantees authorized by the Committee pursuant
to the Plan may be granted without security, but the maximum credit
available shall not exceed the exercise price for the Shares for which
the Option is to be exercised, plus any federal and state income tax
liability incurred in connection with the exercise of the Option.
(d) Outside Directors Options. Each outside director of the
Company (that is, each director who is not also an Employee of the
Company and is not affiliated with any entity directly or indirectly
owning five percent (5%) or more of any class of stock of the Company)
shall be automatically granted Non-Statutory Stock Options for (i)
fifteen thousand (15,000) Shares as of the effective date of this Plan
(or, as of the date of their appointment or election to the Board for
individuals that are not members as of the effective date of the Plan)
and, (ii) one thousand five hundred (1,500) Shares on or about the date
of each successive Annual Meeting of the Shareholders of the Company,
commencing with the Annual Meeting in 1996. Such initial and annually
awarded Options shall be granted on the terms and conditions and
limitations applicable generally to the grant of Non-Statutory Options
under this Plan. The exercise price of such Options shall be one
hundred percent (100%) of the Fair Market Value on the date of grant.
The provisions of this Plan regarding formula awards to outside
directors shall not be
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amended more than once every six (6) months, other then to comport with
changes in the Internal Revenue Code, the Employee Retirement Income
Security Act, or the rules thereunder.
9. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times and under such
conditions as determined by the Committee, including performance
criteria with respect to the Company and/or the Optionee, and as shall
be permissible under the terms of the Plan. Unless otherwise determined
by the Committee at the time of grant, an Option may be exercised in
whole or in part. An Option may not be exercised for a fraction of a
Share.
An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Company in accordance with the
terms of the Option by the person entitled to exercise the Option and
full payment for the Shares with respect to which the Option is
exercised has been received by the company. Full payment may, as
authorized by the Committee, consist of any consideration and method of
payment allowable under Section 8(b) of the Plan. Until the issuance
(as evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect
to the Optioned Stock, notwithstanding the exercise of the Option. No
adjustment will be made for a dividend or other right for which the
record date is prior to the date the stock certificate is issued,
except as provided in Section 10 of the Plan.
Except with respect to Shares not issued to an Optionee pursuant
to Section 8(b)(iv), the exercise of an Option in any manner shall
result in a decrease in the number of Shares which thereafter may be
available, both for purposes of the Plan and for sale under the Option,
by the number of Shares to which the Option is exercised.
(b) Termination of Status as an Employee. If an Employee's
employment by the Company is terminated for cause, then any Option held
by the Employee shall be immediately canceled upon termination of
employment and the Employee shall have no further rights with respect
to such Option. Unless otherwise provided in the Stock Option
Agreement, if an Employee's employment by the Company is terminated for
reasons other than cause, and does not occur due to death or
disability, then the Employee may exercise his Option at any time
during the term of the Option to the extent that he was entitled to
exercise it at the date of such termination, provided that any exercise
of an Incentive Stock Option after the period ending three (3) months
following an Employee's termination shall be treated as the exercise of
a Non-Statutory Stock Option. To the extent that he was not entitled to
exercise the Option at the date of such termination, or if he does not
exercise such Option (which he was entitled to exercise) within the
time specified in the Plan or the Stock Option Agreement, the Option
shall terminate.
(c) Disability. In the event an Employee is unable to continue his
employment with the Company as a result of his permanent and total
disability (as defined
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in Section 22(e)(3) of the Code), he may exercise his Option at any
time during the term of the Option to the extent he was entitled to
exercise it at the date of such termination, provided that any exercise
of an Incentive Stock Option after the period ending one (1) year
following an Employee's termination shall be treated as the exercise of
a Non-Statutory Stock Option. To the extent that he was not entitled to
exercise the Option at the date of termination, the Option shall
terminate.
(d) Death. If an Employee dies during the term of the Option and
is at the time of his death, or was within three months prior to his
death, an Employee of the Company who shall have been in continuous
status as an Employee since the date of grant of the Option, the Option
may be exercised at any time following the date of death during the
term of the Option by the Employee's estate or by a person who acquired
the right to exercise the Option by bequest or inheritance, but only to
the extent that an Employee was entitled to exercise the Option on the
date of death. To the extent the Employee was not entitled to exercise
the Option on the date of death, the Option shall terminate.
(e) Reload Options. Pursuant to applicable Company procedures, if
an Employee exercises an Option and pays all or a portion of the
exercise price pursuant to Section 8(b)(ii), (iii) or (iv), such
Employee (either pursuant to the terms of a Stock Option Agreement or
pursuant to the exercise of Committee discretion) may be granted a new
Option to purchase additional Shares equal to the number of Shares
retained by the Company or Shares not issued to the Optionee pursuant
to Section 8(b)(iii) in such payment. Such new Option: (i) shall have
an exercise price equal to the Fair Market Value per Share on the date
it is granted; (ii) shall first be exercisable six (6) months from its
date of grant; and (iii) shall terminate on the same date as the
termination date of the Options so exercised.
10. Adjustments Upon Changes in Capitalization or Merger. Subject to
any required action by the stockholders of the Company, the number of Shares
covered by each outstanding Option, the Section 162(m) Grant Limit, and the
number of Shares which have been authorized for issuance under the Plan but as
to which no Options have yet been granted or which have been returned to the
Plan upon cancellation or expiration of an Option, as well as the price per
Share covered by each such outstanding Option, shall be proportionately adjusted
for any increase or decrease in the number of issued Shares resulting from a
stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued Shares effected without receipt of consideration by the
Company; provided, however, that conversion of any convertible securities of the
Company shall not be deemed to have been "effected without receipt of
consideration." Such adjustment shall be made by the Committee, whose
determination in that respect shall be final, binding and conclusive. Except as
expressly provided herein, no issuance by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made, with respect to the
number or price of Shares subject to an Option.
In the event of the proposed dissolution or liquidation of the Company,
the Option will terminate immediately prior to the consummation of such proposed
action, unless otherwise provided by the Committee. The Committee may, in the
exercise of its sole discretion in such instances, declare that any Option shall
terminate as of a date fixed by the Committee and give
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each Optionee the right to exercise his Option as to all or any part of the
Optioned Stock, including Shares as to which the Option would not otherwise be
exercisable.
In the event of a proposed sale of all or substantially all of the
assets of the Company, or the merger of the Company with or into another
corporation, the Option shall be assumed or an equivalent option shall be
substituted by such successor corporation or a parent or subsidiary of such
successor corporation, unless the Committee determines, in the exercise of its
sole discretion and in lieu of such assumption or substitution, that the
Optionee shall have the right to exercise the option as to all of the Optioned
Stock, including Shares as to which the Option would not otherwise be
exercisable.
If the Committee makes an Option fully exercisable in lieu of
assumption or substitution in the event of a merger of sale of assets, the
Committee shall notify the Optionee that the Option shall be fully exercisable
for a period of sixty (60) days from the date of such notice (but not later than
the expiration of the term of the Option under the Option Agreement), and the
Option will terminate upon the expiration of such period.
11. Time of Granting Options. The date of grant of an Option shall,
for all purposes, be the date on which the Committee (or the executive office
administrator) makes the determination granting such Option. Notice of the
determination shall be given to each Employee to whom an Option is so granted
within a reasonable time after the date of such grant.
12. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Committee may amend or
terminate the Plan from time to time in such respects as the Committee
may deem advisable; provided, however, that without further shareholder
approval, the Committee's authority hereunder shall be subject to such
restrictions as may be required to comply with Section 16(b) of the
Exchange Act and Section 162(m) of the Code; provided further that the
following revisions or amendments shall require approval of the
Shareholders of the Company, to the extent required by law, rule or
regulation:
i) Any material increase in the number of Shares subject to
the Plan, other than in connection with an adjustment under
Section 10 of the Plan; or
ii) Any material change in the designation of the Employees
eligible to be granted Options.
(b) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall confer the terms and benefits of the
amendment on Options already granted; provided that any termination or
amendment adverse to holders of previously granted Options under the
Plan shall not affect such previously granted Options, and such Options
shall remain in full force and effect as if this Plan had not been
amended or terminated; provided further that any amendment constituting
a "modification" under Section 422 of the Code and the regulations
promulgated thereunder shall not apply to Incentive Stock Options
previously granted.
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13. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the company, such a representation is required by any of
the aforementioned relevant provisions of law.
Inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, shall relieve
the Company of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority shall not have been obtained.
In the case of an Incentive Stock Option, any Optionee who disposes of
Shares of Common Stock acquired upon the exercise of an Option by sale or
exchange (a) either within two (2) years after the date of the grant of the
Option under which the Common Stock was acquired or (b) within one (1) year
after the acquisition of such Shares of Common Stock shall notify the Company of
such disposition and of the amount realized upon such disposition.
14. Reservation of Shares. The Company will at all times reserve and
keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.
15. Option Agreement. Options shall be evidenced by Stock Option
Agreements in such form as the Committee shall approve.
16. Withholding Taxes. The Committee, or Company executives on behalf
of the Committee, may, in its discretion, condition an Optionee's exercise of an
Option on the Optionee's payment to the Company of the Company's federal, state,
local and foreign tax withholding obligations and FICA and FUTA obligations with
respect to the exercise of such Option by the Optionee (the "Company's
Withholding Obligations"). Subject to Section 4(b)(x) of the Plan and prior to
the Tax Date, the Optionee may make an irrevocable election to have the Company
withhold from those Shares that would otherwise be received upon the exercise of
any Option, a number of Shares having a Fair Market Value equal to the minimum
amount necessary to satisfy the Company's Withholding Obligations.
An Optionee who is also an officer of the Company must make the above
described election:
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(a) at least six months after the date of grant of the Option
(except in the event of death or disability); and
(b) either:
i) six months prior to the Tax Date, or
ii) prior to the Tax Date and during the period beginning on
the third business day following the date the Company releases its
quarterly or annual statement of sales and earnings and ending on
the twelfth business day following such date.
17. Miscellaneous Provisions.
(a) Plan Expense. Any expense of administering this Plan shall be
borne by the Company.
(b) Use of Exercise Proceeds. The payment received from Optionees
from the exercise of Options shall be used for the general corporate
purposes of the Company.
(c) Construction of Plan. The place of administration of the Plan
shall be in the State of Arizona, and the validity, construction,
interpretation, administration and effect of the Plan and of its rules
and regulations, and rights relating to the Plan, shall be determined
in accordance with the laws of the State of Arizona without regard to
conflict of law principles and, where applicable, in accordance with
the Code.
(d) Taxes. The Company shall be entitled if necessary or
desirable to pay or withhold the amount of any tax attributable to the
delivery of Common Stock under the Plan from other amounts payable to
the Employee after giving the person entitled to receive such Common
Stock notice as far in advance as practical, and the Company may defer
making delivery of such Common Stock if any such tax may be pending
unless and until indemnified to its satisfaction.
(e) Indemnification. In addition to such other rights of
indemnification as they may have as members of the Board, the members
of the Committee shall be indemnified by the Company against all costs
and expenses reasonably incurred by them in connection with any action,
suit or proceeding to which they or any of them may be party by reason
of any action taken or failure to act under or in connection with the
Plan or any Option, and against all amounts paid by them in settlement
thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a
judgment in any such action, suite or proceeding, except a judgment
based upon a finding of bad faith; provided that upon the institution
of any such action, suit or proceeding a Committee member shall, in
writing, give the Company notice thereof and an opportunity, at its own
expense, to handle and defend the same before such Committee member
undertakes to handle and defend it on her or his own behalf.
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(f) Gender. For purposes of this Plan, words used in the
masculine gender shall include the feminine and neuter, and the
singular shall include the plural and vice versa, as appropriate.
(g) No Employment Agreement. The Plan shall not confer upon any
Optionee any right with respect to continuation of employment with the
Company, nor shall it interfere in any way with his right or the
Company's right to terminate his employment at any time.
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