Exhibit 2.2
FANTOM TECHNOLOGIES INC.
AMENDED AND RESTATED
OUTSIDE DIRECTOR SHARE OPTION AND SHARE
APPRECIATION RIGHTS PLAN - July 1, 2000
Fantom Technologies Inc. (the "Corporation") has established a share
option plan known as the Outside Director Share Option Plan which was effective
as of September 9, 1993 and was amended on October 20, 1994, October 30, 1995
and May 3, 1996 and was further amended and restated effective as of October 24,
1996, as of January 15, 1998, as of October 22, 1998, and as of October 21,
1999. The Corporation hereby further amends and restates such Plan as the
Outside Director Share Option and Share Appreciation Rights Plan (the "Plan")
effective as of July 1, 2000.
1. Purposes of the Plan
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The principal purposes of the Plan are to promote a proprietary
interest in the Corporation among Outside Directors, to attract and retain
Outside Directors and to provide an incentive to Outside Directors who are in a
position to contribute to the long-term growth and success of the Corporation.
2. Definitions and Interpretation
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2.1 In and for the purposes of the Plan:
"Act" means the Securities Act (Ontario) and the regulations thereto, as
the same may be amended or re-enacted from time to time;
"associate" has the meaning ascribed in the Act;
"Award" has the meaning ascribed in section 5.1;
"Award Date" means the date on which an Award is made by the directors to a
Recipient;
"Common Shares" means the common shares in the capital of the Corporation
as constituted at the effective date of the Plan, or any shares or
securities into which such shares may have been changed, reclassified,
subdivided, consolidated or converted;
"Corporation" means Fantom Technologies Inc. and any continuing corporation
resulting from the amalgamation of it and any other corporation or
resulting from any other form of corporate reorganization;
"directors" means the board of directors of the Corporation, and reference
to any action by the directors means action taken by them by resolution as
a board;
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"insider" has the meaning ascribed in the Act;
"Nominee Corporation" has the meaning ascribed in section 9.2;
"Option" means an option to purchase Common Shares granted to a Recipient
pursuant to the Plan;
"Option Fair Market Value" of a Common Share on any date means the closing
board lot sale price per share of Common Shares on the Toronto Stock
Exchange on the trading day prior to such date, provided that if there was
not a board lot sale thereon on such day then the immediately preceding
board lot sale price per share on such Exchange, provided that if there has
not been a board lot sale on the Toronto Stock Exchange within a period of
two trading days prior thereto then the average of the mean between the bid
and ask prices per share for the Common Shares on such Exchange on each of
the five trading days prior to such date;
"Option Price" has the meaning ascribed in section 5.2;
"Outside Director" means an individual who is a member of the board of
directors but is not a full-time employee of the Corporation or any
subsidiary of the Corporation;
"Recipient" means an Outside Director to whom an Award has been made, or
the legal personal representative of such Outside Director, as the context
requires, provided that such Award continues to be held by such Outside
Director or by his Nominee Corporation pursuant to section 9.2;
"Release of Financial Results" means the initial release for publication of
quarterly or annual summary statements of earnings of the Corporation;
"SAR Fair Market Value" of a Common Share on any date means the average of
the high and low trading price per share of Common Shares on the Toronto
Stock Exchange on each of the five trading days prior to such date on which
the Common Shares traded on such Exchange;
"Share Appreciation Rights" has the meaning ascribed in section 5.3;
"Share Compensation Arrangement" means a share option, share option plan,
employee share purchase plan, or any other compensation or incentive
mechanisms involving the issuance or potential issuance of shares of the
Corporation to one or more service providers, including a share purchase
from treasury which is financially assisted by the Corporation by way of a
loan, guarantee or otherwise; and
"subsidiary" has the meaning ascribed in the Act.
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2.2 The masculine gender shall include the feminine gender and the
singular shall include the plural and vice versa, unless the context otherwise
requires.
3. Administration
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The Plan shall be administered by the directors who shall have full
authority to interpret the Plan, to establish, amend and rescind rules and
regulations with regard thereto, and to make all other determinations necessary
for its administration.
4. Common Shares Reserved for the Plan
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Subject to adjustment under the provisions of section 10.1, an
aggregate of 325,000 Common Shares continue to be reserved for issuance under
the Plan. If an Award expires without being exercised for all of the Common
Shares and/or the corresponding Share Appreciation Rights comprising the Award,
the remaining Common Shares shall again be made available for the purposes of
the Plan.
5. Grants of Options and Share Appreciation Rights
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5.1 The directors may, in their discretion, from time to time grant to an
Outside Director an award (the "Award") consisting of (i) an Option to purchase
a stated number of Common Shares from the Corporation, as may be determined by
the directors, and (ii) an equal number of Share Appreciation Rights. A
Recipient may hold more than one Award at any time. Upon the exercise of an
Option under an Award to purchase a number of Common Shares, an equal number of
Share Appreciation Rights granted as part of the Award shall automatically
terminate. Upon the exercise of a number of Share Appreciation Rights under an
Award, the Option granted as part of the Award shall automatically terminate as
to an equal number of Common Shares.
5.2 The subscription price ("Option Price") for each Common Share which
may be purchased on the exercise of an Option shall be an amount determined by
the directors in respect of the particular Award, which shall be not less than
the greater of $1.10 per Common Share and the Option Fair Market Value of a
Common Share on the Award Date.
5.3 Share Appreciation Rights under an Award are a right in the Recipient,
upon the exercise of a stated number of such rights, to surrender the Option
granted as part of the Award unexercised as to an equal number of Common Shares
and to receive, without payment to the Corporation, an amount equal to the
excess of (i) the aggregate SAR Fair Market Value, on the effective date of
exercise of such rights, of that number of Common Shares in respect of which the
Option is surrendered, over (ii) the aggregate Option Price of such Common
Shares.
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6. Limitations on Grant
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The aggregate number of Common Shares in respect of which Awards have
been granted and remain outstanding under the Plan shall not at any time:
(a) when taken together with all of the Corporation's Share Compensation
Arrangements then either in effect or proposed, be such as could
result, within a one-year period, in the issuance:
(i) to insiders of a number of Common Shares exceeding 10%; or
(ii) to any one insider and such insider's associates of a number of
Common Shares exceeding 5%;
of the number of issued and outstanding Common Shares (on a non-
diluted basis) as at the commencement of such one-year period;
(b) in the case of any one Outside Director, exceed 5% of the number of
issued and outstanding Common Shares (on a non-diluted basis) at that
time; or
(c) when taken together with all of the Corporation's Share Compensation
Arrangements then either in effect or proposed, exceed 10% of the
issued and outstanding Common Shares (on a non-diluted basis) at that
time.
7. Term of Awards
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7.1 An Award may be exercised, in whole or in part, at any time and from
time to time, to the extent vested and exercisable in accordance with section
8.1, during the period commencing on the Award Date of such Award and ending at
the close of business on the fifth anniversary of the Award Date of such Award;
provided that:
(a) if a Recipient ceases to be a member of the board of directors for any
reason other than by reason of his death, the Award held by him will
terminate at the close of business on the earlier of the fifth
anniversary of the Award Date and the 45th day following the first
Release of Financial Results after the date on which the Recipient
ceased to be a member of the board of directors; and
(b) if a Recipient ceases to be a member of the board of directors by
reason of his death, the Award held by him will terminate at the close
of business on the earlier of the fifth anniversary of the Award Date
and the 90th day following the first Release of Financial Results
after the date of his death.
7.2 Any Award that is unexercised at the expiry of the applicable period
for exercise shall automatically terminate.
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8. Exercise of Award
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8.1 An Award shall be exercisable only to the extent that the Award has
vested. Subject to article 7 and to the following provisions of this article 8,
each Award granted pursuant to section 5.1 shall become fully vested and
exercisable, provided the Recipient continues as a member of the board of
directors at the relevant time, on the first anniversary of the Award Date of
such Award. In the event of the death of a Recipient or his ceasing to be a
member of the board of directors for any other reason, the Award held by him
will only be vested and exercisable to the extent it was so vested and
exercisable on the date he ceased to be a member of the board of directors.
8.2 An Option shall be exercised by the Recipient (or, in the
circumstances contemplated by section 9.2, a Nominee Corporation) by written
notice given to the Vice President, Chief Financial Officer of the Corporation
specifying the number of Common Shares in respect of which the Option is being
exercised at such time, accompanied by a certified cheque (payable at par in
Welland, Canada) in payment for such Common Shares at the Option Price per share
specified in such Option, whereupon the purchase pursuant to such Option of the
Common Shares so specified shall be deemed for all purposes to have been
completed and such Option exercised to such extent. Upon receipt of a notice of
exercise of an Option and payment of the Option Price, the Corporation shall,
within 10 days thereafter, issue to the Recipient (or, in the circumstances
contemplated by section 9.2, to the Nominee Corporation) the number of Common
Shares in respect of which the Option is exercised.
8.3 Share Appreciation Rights shall be exercised by the Recipient (or, in
the circumstances contemplated by section 9.2, a Nominee Corporation) by written
notice given to the Vice President, Chief Financial Officer of the Corporation
specifying the number of Share Appreciation Rights being exercised at such time.
Upon receipt of a notice of exercise of Share Appreciation Rights, the
Corporation shall, within 10 days thereafter, pay to the Recipient (or, in the
circumstances contemplated by section 9.2, to the Nominee Corporation) an amount
equal to the excess of (i) the aggregate SAR Fair Market Value, on the effective
date of exercise of such rights, of that number of Common Shares in respect of
which the Option is surrendered over (ii) the aggregate Option Price of such
Common Shares in respect of which the Option is surrendered.
8.4 Any notice delivered under this article 8 may relate in part to the
exercise of an Option and in part to the exercise of Share Appreciation Rights.
9. Non-Assignability
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9.1 Except as provided in section 9.2:
(a) no Award shall be assignable, negotiable or otherwise transferable
other than by will or the laws relating to intestacy; and
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(b) an Award may be exercised during a Recipient's lifetime only by the
Recipient and, after his death, only by his legal personal
representative.
9.2 A Recipient may, with the prior consent of the directors and the
Toronto Stock Exchange, request that all but not less than all of his Award be
held by such corporation (the "Nominee Corporation") as may be designated by the
Recipient provided that:
(a) the Recipient delivers to each of the Corporation and the Toronto
Stock Exchange a written undertaking in form and substance
satisfactory to each of them that during his lifetime (i) the
Recipient shall retain all beneficial right and title to and interest
in the Award; and (ii) so long as he remains competent and able to act
as such, the Recipient shall remain the sole director, officer and
shareholder of the Nominee Corporation; and
(b) the Recipient, the Nominee Corporation and the Corporation enter into
an agreement in form and substance satisfactory to the Corporation
amending the agreement previously entered into between the Recipient
and the Corporation relating to the Award.
10. Miscellaneous
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10.1 In the event that there is any change in the Common Shares by way of
merger, amalgamation, reorganization, subdivision, consolidation or otherwise,
or in the event that a stock dividend or special dividend is declared on the
Common Shares, and the directors determine that an adjustment should be made,
the number of Common Shares subject to the Plan, the number of Common Shares to
which the Awards relate under the Plan and/or the Option Price per share, shall
be equitably adjusted as the directors may, in their sole discretion, determine.
10.2 The directors may, from time to time, without further approval of the
shareholders of the Corporation but subject to the approval of the Toronto Stock
Exchange, amend any of the provisions of the Plan, but no amendment shall divest
any Recipient of his rights under an Award or increase the number of Common
Shares reserved under the Plan, except as required by section 10.1.
10.3 The directors may terminate the Plan at any time, provided that all
rights and obligations created prior to such time shall not be affected thereby.
10.4 The Plan shall not be construed as giving any Recipient the right to
be or to continue to be a director of the Corporation.
10.5 Nothing contained herein shall restrict or limit or be deemed to
restrict or limit the rights or powers of the directors in connection with any
allotment and issuance of shares in the capital of the Corporation which are not
allotted and issued under the Plan.
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10.6 The Plan is established under the laws of the Province of Ontario and
the rights of all parties and the construction and effect of each and every
provision of the Plan shall be according to the laws of the Province of Ontario.
10.7 The Plan shall be binding upon the Corporation and its successors and
assigns and shall enure to the benefit of a Recipient and his personal
representative.
10.8 Upon the communication to a Recipient of the granting of an Award, he
shall be given a copy of the Plan as the same may have been amended to that
time.
10.9 Each Award shall be evidenced by a written agreement between the
Corporation and the Recipient, which agreement shall be consistent with the
terms of the Plan as the same may have been amended to that time.
11. Effective Date
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This Plan shall have an effective date of July 1, 2000.