SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
EXPLORE TECHNOLOGIES, INC.
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(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
Explore Technologies Inc.
#201-1166 Alberni Street Ph: (604) 689-7100
Vancouver BC Canada V6E 3Z3 Fax: (604) 689-8988
July 23, 2001
Dear Shareholder:
On behalf of the Board of Directors (the "Board") of Explore Technologies Inc.
(the "Company") I cordially invite you to the Annual General Meeting of
Shareholders (the "Annual Meeting") to be held on Monday, August 27, 2001 at
1:00 p.m., Pacific Standard Time (PST) at the Renaissance Madison Hotel, 515
Madison Street, Seattle, Washington, 98104. I hope that you will be able to
attend in person. Following the formal business of the Annual Meeting,
management will be available to respond to your questions.
At the Annual Meeting, shareholders will be asked to consider and vote upon the
following matters:
(i) To consider and vote for the election of Directors;
(ii) To approve the appointment of the firm Morgan & Company, independent
certified public accountants, as the Company's auditors; and
(iii) To ratify and approve the Company's 2000 Combined Incentive and
Nonqualified Stock Option Plan; and
(iv) To provide the Board of Directors authorization to Roll Back the Issued
and Outstanding shares of the Company Ten to One (10:1); and
(v) Any other business that may be lawfully brought before the Annual
Meeting.
The foregoing items of business are more fully described in the Proxy Statement
accompanying this letter.
Only Shareholders of record at the close of business on July 20, 2001 are
entitled to notice of the Annual Meeting and to vote at the Meeting or at any
continuance(s) or any adjournment(s) thereof. Each share of stock is entitled
to one vote per share at the meeting.
I hope you will attend the Annual Meeting. Whether or not you plan to attend
the Annual Meeting and regardless of the number of shares of stock you own,
please complete, date and sign the enclosed proxy form and return it by fax to
(604) 689-8988 or by mail to: #201-1166 Alberni Street, Vancouver, British
Columbia, Canada, V6E 3Z3, Attention: Rod Jao. You may, of course, attend the
Annual Meeting and vote in person, even if you have previously returned your
proxy form.
To assist the Company in making arrangements for the meeting, please notify Rod
Jao of the Company by telephone (604) 689-7100 or Fax (604) 689-8988 before
August 15, 2001 if you plan to attend the meeting in person.
By Order of the Board of Directors
/s/ Rod Jao
Rod Jao
Chief Executive Officer
EXPLORE TECHNOLOGIES INC.
#201-1166 Alberni Street
Vancouver BC V6E 3Z3 Canada
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS OF
EXPLORE TECHNOLOGIES INC.
- --------------------------------------------------------------------------------
To the Shareholders of Explore Technologies Inc.:
NOTICE IS HEREBY GIVEN that an Annual Meeting of the Shareholders of Explore
Technologies Inc. (the "Company") will be held on Monday, August 27, 2001 at
1:00 p.m. Pacific Standard Time, at the Renaissance Madison Hotel, 515 Madison
Street, Seattle, Washington, 98104.
At the Annual Meeting, the shareholders will be asked to: (i) To consider and
vote for the election of Directors; (ii) To approve the appointment of the firm
Morgan & Company, independent certified public accountants, as the Company's
auditors; (iii) To approve Company's 2000 Combined Incentive and Nonqualified
Stock Option Plan; (iv) To provide the Board of Directors authorization to Roll
Back the Issued and Outstanding shares of the Company Ten to One (10:1) without
further shareholder approval; (v) Any other business that may be lawfully
brought before the Annual Meeting.
The foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice.
Only Shareholders of record at the close of business on July 20, 2001 are
entitled to notice of and to vote at the Annual Meeting or at any continuance(s)
or any adjournment(s) thereof. Each share of stock is entitled to one vote per
share at the meeting.
The election of Directors will be determined by plurality vote. Approval of the
appointment of the Company's auditors and all other proposals will require the
affirmative votes of a majority of the voting shares of Explore Technologies
Inc., represented in person or by proxy, which are cast at the Annual Meeting.
To assist the Company in making arrangements for the meeting, please notify Rod
Jao of the Company by telephone (604) 689-7100 or Fax (604) 689-8988 before
August 15, 2001 if you plan to attend the meeting in person.
By Order of the Board of Directors
/s/ Rod Jao
Rod Jao
Chief Executive Officer
PLEASE NOTE: YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN. Even if
you plan to attend the Annual Meeting, please fill in, date, sign and mail
promptly the enclosed proxy to ensure that your shares are represented at the
Annual Meeting. If you attend the Annual Meeting in person, you may vote in
person if you wish to do so even though you have previously sent in your proxy.
PLEASE MAIL YOUR PROXY PROMPTLY AND SAVE THE COMPANY THE EXPENSE OF ADDITIONAL
REQUESTS FOR PROXIES.
EXPLORE TECHNOLOGIES INC.
#201-1166 Alberni Street
Vancouver BC V6E 3Z3 Canada
- --------------------------------------------------------------------------------
PROXY STATEMENT
----------------
General
This Proxy Statement is furnished to shareholders of Explore Technologies Inc.,
a Nevada Corporation (the "Company"), in connection with the solicitation of
proxies to be voted at the Company's next Annual Meeting of Shareholders. The
Annual Meeting will be held on Monday, August 27, 2001 at 1:00 p.m. Pacific
Standard Time, at the Renaissance Madison Hotel, 515 Madison Street, Seattle,
Washington, 98104. The accompanying proxy is being solicited on behalf of the
Board of Directors of the Company. This Proxy Statement was mailed to the
shareholders of Record of the Company as of July 20, 2001 accompanied by the
Company's 2000 Annual Report to Shareholders.
At the Meeting, the following matters will be considered and voted upon:
1. Proposal No. 1. Election of Keith Andrews, Rod Jao, and Cecil Morris as
Directors to hold office until the 2002 Annual Meeting of Shareholders
or until their successors shall have been duly elected and qualified.
(See "Proposal One- Election of Directors"); and
2. Proposal No. 2. Appointment of Morgan & Company as the Company's
independent certified public accountants for the 2001 fiscal year. (See
"Proposal Two -Independent Public Accountants"); and
3. Proposal No. 3. To ratify and approve the Company's 2000 Combined
Incentive and Nonqualified Stock Option Plan. (See "Proposal Three -
Approval of 2000 Combined Incentive and Nonqualified Stock Option
Plan"); and
4. Proposal No. 4. To provide the Board of Directors authorization to Roll
Back the Issued and Outstanding shares of the Company Ten to One (10:1)
at the Board's discretion without further Shareholder approval. (See
"Proposal Four -Approval to Roll Back the Issued and Outstanding Shares
of the Company"); and
5. General. Any other business that may be lawfully brought before the
Annual Meeting. (See "General").
The Board of Directors recommends that shareholders vote FOR all nominees for
Director listed in Proposal No. 1 and FOR Proposal Nos. 2, 3, 4 and 5.
1
INFORMATION CONCERNING PROXY SOLICITATION AND VOTING
Voting Rights
The Outstanding voting securities of the Company on July 20, 2001 was
15,250,000 shares of Common Stock, par value $0.001 per share ("Common Stock").
Holders of Common stock at the close of business on July 20, 2001 (the "Record
Date") will be entitled to one vote at the Annual Meeting for each share of
Common Stock held of Record by them.
Voting and Revocation of Proxies
- --------------------------------
By completing and returning the accompanying proxy form, the shareholder
authorizes Rod Jao, or in his place, Keith Andrews, as designated on the face of
the proxy form (the "Proxy Holder"), to vote all shares for the shareholder.
All proxies returned to the Company that are properly signed and dated will be
voted by the Proxy Holder as the shareholder directs.
If no direction is given, valid proxies will be voted by the Proxy Holder:
1. FOR the election of the persons nominated as directors; and
2. FOR the appointment of Morgan & Company as the Company's independent
certified public accountants for the 2001 fiscal year; and
3. FOR approval of the Company's 2000 Combined Incentive and Nonqualified
Stock Option Plan; and
4. FOR the Board of Directors to Roll Back the Issued and Outstanding Common
shares of the Company 10:1 without further shareholder approval; and
5. Additionally, the shares represented by a valid proxy will be voted by
the Proxy Holder in his discretion, on any other matters that may
properly come before the Annual Meeting and that the Company did not have
notice of as of June 15, 2001. The Board of Directors does not know of
any matters to be considered at the Annual Meeting other than the
proposals described above. In the event that any director nominee is
unable to serve, the Proxies will be voted for a substitute nominee, if
any, to be designated by the Board of Directors. The Board of Directors
currently has no reason to believe that any nominee will be unavailable
or unwilling to serve.
A proxy may be revoked by (i) delivering a written statement to the President of
the Company stating that the proxy is revoked, (ii) by delivering to the
President of the company or presenting at the Annual Meeting a new proxy
executed on a later date by or on behalf of the person or entity executing the
prior proxy, or (iii) by voting in person at the Annual Meeting. A revoked
proxy will not be voted.
2
Quorum and Voting Requirements
A quorum of the voting shares of the Company must be present at the Annual
Meeting for vote to be taken. Under Nevada law and the Company's certificate of
Incorporation and Bylaws, a quorum will be present if not less than one percent
(1%) of the outstanding shares of stock entitled to vote are present, in person
or by proxy duly authorized. Under Nevada law and the Company's Certificate of
Incorporation and Bylaws, abstensions and broker non-votes will be counted for
the purposes of determining whether a quorum is present at the Annual Meeting.
With regard to Proposal No. 1, directors are elected by a plurality of the
shares present in person or by proxy and voting at the Annual Meeting. With
regard to the election of directors, votes may be cast in favour or withheld;
votes that are withheld will be excluded entirely from the vote and will have no
effect.
The appointment of auditors under Proposal No. 2 requires the affirmative vote
of a majority of the votes cast at the Annual Meeting. With regard to Proposal
No. 2, abstentions and broker non-votes are not counted for purposes of
determining whether a proposal has been approved.
With regard to Proposal No. 3, the approval of the Company's 2000 Combined
Incentive and Nonqualified Stock Option Plan requires the affirmative vote of a
majority of the votes cast at the Annual Meeting. With regard to Proposal No.
3, abstentions and broker non-votes are not counted for purposes of determining
whether a proposal has been approved.
With regard to Proposal No. 4, to provide the Board of Directors authorization
to Roll Back the Issued and Outstanding shares of the Company Ten to One (10:1)
at the Board's discretion without further Shareholder approval requires the
affirmative vote of a majority of the votes cast at the Annual Meeting. With
regard to Proposal No. 4, abstentions and broker non-votes are not counted for
purposes of determining whether a proposal has been approved.
With regard to Proposal No. 5 any other business that may lawfully be brought
before the Meeting will be voted by the Proxy Holder in his discretion. With
regard to Proposal No. 5, abstentions and broker non-votes are not counted for
purposes of determining whether a proposal has been approved.
Adjournment of Annual Meeting
In the event that Proxies representing sufficient votes to constitute a quorum
are not received by the date of the Annual Meeting, the Proxy Holder may propose
one or more adjournments of the Annual Meeting to permit further solicitation of
proxies. At such adjournments the proxies will continue to be valid and, once a
quorum is present in person or by proxy, directors may be elected by plurality
vote and the Company will otherwise conduct the business of the Annual Meeting.
The Proxy Holder will vote in favour of any such proposed adjournments.
3
Solicitation
The solicitation of proxies pursuant to this Proxy Statement will be made
primarily by mail. In addition, officers, employees and representatives of the
Company may solicit proxies by telephone, mail or personal interviews and
arrangements will be made with banks, brokerage firms and others to forward
solicitation materials to the beneficial owners of shares held of record by
them.
The total cost of all such solicitation efforts, including reimbursement of
expenses of brokers and other nominees, will be borne by the Company.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information as of January 31, 2001 with
respect to (i) each person who is known to the Company to beneficially own more
than five percent of the outstanding shares of Common Stock of the Company, (ii)
the beneficial ownership of such securities by each executive officer and
director of the Company, and (iii) the beneficial ownership of all such
securities by all or the Company's directors and executive officers as a group.
Stock is considered "beneficially owned" by a person if such person, directly or
indirectly, through any contract, arrangement, understanding or otherwise, has
or shares: (i) voting power for the stock; and/or (ii) investment power for the
stock (including the power to dispose of the stock). Such "beneficial
ownership" also includes stock that a person has the right to acquire within 60
days of January 31, 2001. Unless otherwise indicated, the persons or entities
named in the table have sole voting and investment power with respect to all
shares of stock beneficially owned by them, subject to applicable community
property laws. The percentage ownership for each person is calculated assuming
that all the stock that could be acquired by that person within 60 days, by
option exercise or otherwise, has in fact been acquired and that no other
shareholder has exercised a similar right to acquire additional shares.
Class of Name and Address of Amount and Nature of Percent of
Shares Beneficial Owner Beneficial Ownership Class of
Shares
Common Antico Holdings AVV 1,000,000 6.55%
7 Abraham De Veerstraat,
P.O. Box 840, Curacao. N.A.
Common Tommy Calvert 1,000,000 6.55%
7 Abraham De Veerstraat,
P.O. Box 840, Curacao. N.A.
Common Weblink Marketing S.A. 1,000,000 6.55%
P.O. Box 25635, Miami FL 33102
Common Euro Capital Holdings AVV 780,625 5.11%
7 Abraham De Veerstraat,
P.O. Box 840, Curacao. N.A.
Common /1/Rod Jao Nil 0%
#201-1166 Alberni Street
Vancouver BC V6E 3Z3
Common /2/Keith Andrews Nil 0%
627 Moberly Road
No. 602
Vancouver BC V5Z 4B3
______________________________
/1/ CEO, President, Director. No shares held directly
/2/ Secretary, Director. No shares held directly
4
Common /3/Cecil Morris 690,625 4.53%
03 The Tides, Royal Road
Cape Town, South Africa
- --------------------------------------------------------------------------------
Common
Common All Directors and Executives 690,625 4.53%
as a Group
PROPOSAL ONE - ELECTION OF DIRECTORS
Nominees
Two current directors, Rod Jao and Cecil Morris are proposed to be elected at
the Annual Meeting. Mr. Charlo Barbosa is unable to serve as a Director for the
ensuing year. The Board of Directors is proposing Mr. Keith Andrews to act as a
third Director.
Directors and Executive Officers of the Company
The following table sets forth certain information concerning Directors and
Executive Officers of the Company and certain Officers/Directors of the wholly
owned subsidiaries of the Company.
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Began to Serve as
Name Age Positions Held an Officer or Director
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Rod Jao 29 CEO, President, Director 2000
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Keith Andrews 42 Secretary, Director 2001
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Cecil Morris 70 Director 2001
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No family relationships exist among any of the Directors or Officers. All
Directors hold office until the next Annual Meeting of Shareholders or until
their successors are duly elected and qualified. Officers serve at the pleasure
of the Board of Directors.
The principal occupations of the Executive Officers and Directors named above
for at least the past five (5) years are as follows:
Keith Andrews is currently the Vice President-Strategic Alliances for Verb
Exchange(TM), a Vancouver Unified Communications company, responsible for
negotiating partnership and alliance agreements. Prior to joining Verb Exchange
(TM), Mr. Andrews ran his own successful consulting firm for 10 years providing
services, strategies and contract negotiating skills to major corporations. He
has worked with AT&T, Spectra Group, IMG, and Keg Restaurants. Mr. Andrews has
been responsible for major sponsorship and alliance negotiations involving
renowned firms such as Molson Breweries, Labatt's, Nike, Coca Cola, Pepsi, JBL,
BOSE, and major sports affinity associations. Mr. Andrews also sits on the Board
of Codeworx a Vancouver, B.C. software application development firm.
______________________
/3/ Director. 690,625 shares held directly
5
Rod Jao has been employed as the President and Director of UWANTCASH.com, Inc.
Mr. Jao is an entrepreneur and is the principal of his own consulting company,
which offers project management services, private franchise business development
and advice on investment strategy. Mr. Jao is also a sought-after speaker in
the private franchise industry with extensive experience in the areas of
management, projects, administration, budgeting and design.
Cecil Morris is a freelance Internet business consultant based in Cape Town,
South Africa with expertise in software programming.
Significant Employees
There are presently no significant employees of the Company other than the
Directors and Officers of the Company.
Standing Audit Committee
The Company does not presently have an appointed Standing Audit Committee.
Accounting Fees
Audit Fees
Aggregate fees rendered for the audit of the Registrant's Annual Financial
Statements for the most recent fiscal year and the reviews of the Registrant's
Form 10KSB for that fiscal year totaled US$3,000.
Financial Information System Design and Implementation Fees
The Company incurred no aggregate fees billed for professional services rendered
for Financial Information System Design and Implementation.
All Other Fees
The Company incurred no aggregate fees billed for services rendered by the
Principal Accountants other than the services covered under "Audit Fees" in this
section.
Executive Compensation
Summary Compensation
6
The following table sets forth the compensation of the Chief Executive Officer
of the Company and certain other highly compensated Executive Officers of the
Company for each of the Company's last three fiscal years whose total salary and
bonus for the year ended January 31, 2001.
The Company and its subsidiaries have no pension or retirement plan for its
Executive Officers. The Company prefers to pay higher cash compensation in lieu
of making substantial pension plan contributions. The Company and its
subsidiaries have adopted informal, unwritten bonus plans for its employees and
executive officers. Under the plans, each Company's Board of Directors
typically evaluates the Company's productivity and allocates bonuses twice a
year based primarily on such productivity and the employee's performance.
Summary Compensation Table
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Name and Year Salary Bonus Other Annual Restricted Stock Options Pay All Other
Position Per Compensation Awards /SARs outs Compensation
Annum
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Rod Jao, Fiscal -0- -0- -0- -0- 150,000 -0- -0-
CEO 2000
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Keith Fiscal -0- -0- -0- -0- -0- -0- -0-
Andrews, 2000
Secretary
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Cecil Fiscal -0- -0- -0- -0- -0- -0- -0-
Morris, 2000
Director
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Rod Jao, Fiscal -0- -0- -0- -0- -0- -0- -0-
CEO 1999
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Keith Fiscal -0- -0- -0- -0- -0- -0- -0-
Andrews, 1999
Secretary
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Cecil Fiscal -0- -0- -0- -0- -0- -0- -0-
Morris, 1999
Director
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Rod Jao, Fiscal -0- -0- -0- -0- -0- -0- -0-
CEO 1998
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Keith Fiscal -0- -0- -0- -0- -0- -0- -0-
Andrews, 1998
Secretary
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Cecil Fiscal -0- -0- -0- -0- -0- -0- -0-
Morris, 1998
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Director
Stock Option Grants and Aggregated Stock Option/SAR Exercises
The Company granted no stock options or stock appreciation rights ("SARs") to
the named Executive Officers in the last fiscal year. The following table sets
forth the aggregated Common Stock Options exercised by the named Executive
Officers in the last fiscal year and the year-end value of unexercised options:
7
Aggregated Option/SAR Exercises in Fiscal Year Ended January 31, 2000
And Fiscal Year-End Option Values
- --------------------------------------------------------------------------------------------------------------------------
Name Shares Value realized Number of unexercised Value of Unexercised in-
acquired on ($) Options/SARs at Fiscal the-money Options/SARs
Exercise (#) Year-End (#) at Fiscal Year-End ($)
Exercisable/Unexercisable Exercisable/Unexercisable
- --------------------------------------------------------------------------------------------------------------------------
Keith Andrews -0- -0- -0-/ -0-
-0-
- --------------------------------------------------------------------------------------------------------------------------
Rod Jao -0- -0- 150,000/ -0-
-0-
- --------------------------------------------------------------------------------------------------------------------------
Cecil Morris -0- -0- -0-/ -0-
-0-
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Director Compensation
Cecil Morris
For his services as a non-employee Director of the Company, the Company will
compensate Cecil Morris $3,000 per annum. Under the agreement, for his services
as Director of the Company, Mr. Morris will also receive 150,000 options with an
immediate vesting date upon execution of the agreement to act as Director.
Employment Agreements
Rod Jao
On February 1, 2001 the Company entered into an employment agreement with Rod
Jao. The term of the agreement is one year, with the right of the Company to
terminate the agreement with thirty days written notice. Under the agreement,
for his services as CEO and President of the Company, Mr. Jao will receive a
base salary of $3,000 per annum.
For his services as a Director prior to February 1, 2001, Mr. Jao received
150,000 options with an immediate vesting date.
Keith Andrews
On February 1, 2001 the Company entered into an employment agreement with Keith
Andrews. The term of the agreement is one year, with the right of the Company
to terminate the agreement with thirty days written notice. Under the
agreement, for his services as Secretary of the Company, Mr. Andrews will
receive a base salary of $3,000 per annum.
Under his employment agreement, Mr. Andrews will receive 150,000 options with an
immediate vesting date upon execution of the employment agreement.
8
Certain Relationships and Related Transactions
None.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ELECTION OF ALL
NOMINEES TO THE BOARD OF DIRECTORS NAMED ON THE ACCOMPANYING PROXY FORM.
PROPOSAL TWO - APPOINTMENT OF AUDITORS
Morgan & Co. has been the Company's independent auditors since July 1994.
Proposal No. 2 is to reappoint Morgan & Co. as the Company's independent public
accountants for the fiscal year ending January 31, 2002. No representative of
Morgan & Co. is expected to be present at the Annual Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE APPOINTMENT OF
MORGAN & CO. AS THE COMPANY'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING
JANUARY 31, 2002
PROPOSAL THREE - APPROVAL OF THE COMPANY'S 2000 COMBINED
INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN
A complete copy of the Company's 2000 Combined Incentive and Nonqualified Stock
Option Plan is as follows:
EXPLORE TECHNOLOGIES INC.
2000 Combined Incentive and Nonqualified Stock Option Plan
1 Purpose. The purpose of the 2000 Combined Incentive and Nonqualified
-------
Stock Option Plan (the "Plan") is to provide a means by which Explore
Technologies Inc., a Nevada corporation (the "Company"), may attract,
reward and retain services or advice of current or future employees,
officers, directors and agents of the Company and to provide added
incentives to them by encouraging stock ownership in the Company.
2 Administration. This Plan shall be administered by the Board of
--------------
Directors of the Company (the "Board") or, if the Board shall authorize
a committee to administer this Plan, by such committee to the extent so
authorized; provided, however, that only the Board of Directors may
suspend, amend or terminate this Plan as provided in Section 13, and
provided further that a committee that includes officers of the Company
shall
9
not be permitted to grant options to persons who are officers of the
Company. The administrator of this Plan is referred to as the "Plan
Administrator".
2.1 Procedures. The Board of Directors shall designate one member of
----------
the Plan Administrator as chairman. The Plan Administrator may
hold meetings at such times and places as it shall determine. The
acts of a majority of the members of the Plan Administrator
present at meetings at which a quorum exists, or acts approved in
writing by all Plan Administrator members, shall constitute valid
acts of the Plan Administrator.
2.2 Powers. Subject to the specific provisions of this Plan, the Plan
------
Administrator shall have the authority, in its discretion: (a) to
grant the stock options described in Section 5, including
Incentive Stock Options and Non-Qualified Stock Options, and to
designate each option granted as an Incentive Stock Option or a
Non-Qualified Stock Option; (b) to determine, in accordance with
section 5.1 (f) of this Plan, the fair market value of the shares
of Common Stock subject to options; (c) to determine the exercise
price per share of options; (d) to determine the Optionees to
whom, and the time or times at which, options shall be granted
and the number of shares of common Stock to be represented by
each option; (e) to interpret this Plan; (f) the prescribe, amend
and rescind rules and regulations relating to this Plan; (g) to
determine the terms and provisions of each option granted (which
need not be identical) and, with the consent of the Optionee,
modify or amend each option; (h) to reduce the exercise price per
share of the outstanding and unexercised options; (i) to defer,
with the consent of the Optionee, or to accelerate the exercise
date of any option; (j) to waive or modify any term or provisions
contained in any option applicable to the underlying shares of
Common Stock; (k) 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 Plan Administrator; and (l) to
make all other determinations deemed necessary or advisable for
the administration of this Plan. The interpretation and
construction by the Plan Administrator of any terms or provisions
of this Plan, any option issued hereunder or of any rule or
regulation promulgated in connection herewith and all actions
taken by the Plan Administrator shall be conclusive and binding
on all interested parties. The Plan Administrator may delegate
administrative functions to individuals who are officers or
employees of the Company.
2.3 Limited Liability. No member of the Board of Directors or the
-----------------
Plan Administrator or officer of the Company shall be liable for
any action or inaction of the entity or body, or another person
or, except in circumstances involving bad faith, of himself or
herself. Subject only to compliance with the explicit provisions
hereof, the Board of Directors and Plan Administrator may act in
their absolute discretion in all matters related to the Plan.
2.4 Securities Exchange Act of 1934. At any time that the Company has
-------------------------------
a class of securities registered pursuant to Section 12 of the
Securities Exchange Act
10
of 1934, as amended (the "Exchange Act"), this Plan shall be
administered in accordance with Rule 16b-3 adopted under the
Exchange Act and Section 162(m) of the Internal Revenue Code of
1986, as amended, and the regulations, proposed and final,
thereunder, as all may be amended from time to time, and each
member of the Plan Administrator shall be a "disinterested
director" and an "outside director" with the meaning of such Rule
16b-3 and Section 162(m), respectively.
3 Stock Subject to This Plan. Subject to adjustment as provided below
--------------------------
and in Section 11 hereof, the stock subject to this Plan shall be the
Company's common stock (the "Common Stock") and the total number of
shares of Common Stock to be delivered on the exercise of all options
granted under this Plan shall not exceed 3,000,000 shares as such
Common Stock was constituted on the Effective Date of this Plan (as
defined in Section 15 hereof). If any option granted under this Plan
expires, is surrendered, exchanged for another option, canceled or
terminated for any reason without having been exercised in full, the
unpurchased shares subject thereto shall again be available for
purposes of this Plan, including for replacement options that may be
granted in exchange for such surrendered, canceled or terminated
options. Shares issued on exercise of options granted under this Plan
may be subject to restrictions on transfer, repurchase rights or other
restrictions as determined by the Plan Administrator.
4 Eligibility.
-----------
4.1 Optionees. The Plan Administrator may award options to any
---------
current or future employee, officer, agent, consultant or
director of the Company or its subsidiaries. Any party to whom an
option is granted under this Plan is referred to as an
"Optionee".
4.2 Subsidiaries. As used in this Plan, the term "subsidiary" of a
------------
company shall include any corporation in which such company owns,
directly or indirectly, at the time of the grant of an option
hereunder, stock having 50% or more of the total combined voting
power of all classes of stock thereof.
5 Awards. The Plan Administrator, from time to time, may take the
------
following actions, separately or in combination, under this Plan: (a)
grant Incentive Stock Options, as defined in Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code") to any employee
of the Company or its subsidiaries, as provided in Section 5.1 of this
Plan; (b) grant options other than Incentive Stock Options ("Non-
Qualified Stock Options") as provided in Section 5.2 of this Plan; (c)
grant options to officers, employees and others in foreign
jurisdictions, as provided in Section 7 of this Plan; and (d) grant
options in certain acquisition transactions, as provided in Section 8
of this Plan. No employee may be granted options to acquire more than
100,000 shares in any fiscal year of the Company.
11
5.1 Incentive Stock Options. Incentive Stock Options shall be subject
------------------------
to the following terms and conditions:
(a) Incentive Stock Options may be granted under this Plan only
to employees of the company or its subsidiaries, including
employees who are directors.
(b) No employee may be granted Incentive Stock Options under
this Plan to the extent that the aggregate fair market
value, on the date of grant, of the Common Stock with
respect to which Incentive Stock Options are exercisable for
the first time by that employee during any calendar year,
under this Plan and under any other incentive stock option
plan (within the meaning of Section 422 of the Code) of the
Company or any subsidiary, exceeds $250,000. To the extent
that any option designated as an Incentive Stock Option
exceeds the $250,000 limit, such option shall be treated as
a Non-Qualified Stock Option. In making this determination,
options shall be taken into account in the order in which
they were granted, and the fair market value of the shares
of Common Stock shall be determined as of the time that the
option with respect to such shares was granted.
(c) An Incentive Stock Option may be granted under this Plan to
an employee possessing more than 10% of the total combined
voting power of all classes of stock of the Company (as
determined pursuant to the attribution rules contained in
Section 424(d) of the Code) only if the exercise price is at
least 110% of the fair market value of the common Stock
subject to the option on the date the option is granted, as
described in Section 5.1(f) of this Plan, and only if the
option by its terms is not exercisable after the expiration
of five years from the date it is granted.
(d) Except as provided in sections 5.5 of this Plan, no
Incentive Stock Option granted under this Plan may be
exercised unless at the time of such exercise the Optionee
is employed by the Company or any subsidiary of the company
and the Optionee has been so employed continuously since the
date such option was granted.
(e) Subject to Sections 5.1(c) and 5.1(d) of this Plan,
Incentive Stock Options granted under this Plan shall
continue in effect for the period fixed by the Plan
Administrator, except that no Incentive Stock Option shall
be exercisable after ten years from the date it is granted.
(f) The exercise price shall not be less than 100% of the fair
market value of the shares of Common Stock covered by the
Incentive Stock Option at the date the option is granted.
The fair market value of shares shall be the closing price
per share of the Common Stock on the date of grant as
reported on a securities quotation system or stock exchange.
If such
12
shares are not so reported or listed, the Plan Administrator
shall determine the fair market value of the shares of
Common Stock in its discretion.
(g) The provisions of clauses (b) and (c) of this Section shall
not apply if either the applicable sections of the Code or
the regulations thereunder are amended so as to change or
eliminate such limitations or to permit appropriate
modifications of those requirements by the Plan
Administrator.
5.2 Non-Qualified Stock Options. Non-Qualified Stock Options shall
----------------------------
be subject to the following terms and conditions:
(a) The exercise price may be more or less than or equal to the
fair market value of the shares of Common Stock covered by
the Non-Qualified Stock Option on the date the option is
granted, and the exercise price may fluctuate based on
criteria determined by the Plan Administrator. The fair
market value of shares of Common Stock covered by a Non-
Qualified Stock Option shall be determined by the Plan
Administrator, as described in Section 5.1(f).
(b) Unless otherwise established by the Plan Administrator, any
Non-Qualified Stock Option shall terminate ten years after
the date it is granted.
5.3 Vesting. To ensure that the Company will achieve the purposes of
-------
and receive the benefits contemplated in this Plan, any option
granted to any Optionee hereunder shall be exercisable according
to a vesting schedule or no vesting schedule as established or
determined by the Plan Administrator.
5.4 Nontransferability. Options granted under this Plan and the
------------------
rights and privileges conferred hereby may not be transferred,
assigned, pledged or hypothecated in any manner (whether by
operation of law or otherwise) other than by will or by the
applicable laws of descent and distribution, shall not be subject
to execution, attachment or similar process, and shall be
exercisable during the Optionee's lifetime only by the Optionee.
Any purported transfer or assignment in violation of this
provision shall be void.
5.5 Termination of Options.
----------------------
(a) Generally. Unless otherwise determined by the Plan
---------
Administrator or specified in the Optionee's Option
Agreement, if the Optionee's employment or service with the
Company terminates for any reason other than for cause,
resignation, retirement, disability or death, and unless by
its terms the option sooner terminates or expires, then the
Optionee may exercise, for a three month period, that
portion of the Optionee's option that was exercisable at the
time of such termination of employment or
13
service (provided the conditions of Section 6.4 and any
other conditions specified in the Option Agreement shall
have been met by the date of exercise of such option.
(b) For Cause: Resignation.
-----------------------
(i) If an Optionee is terminated for cause or resigns in lieu of
dismissal, any option granted hereunder shall be deemed to
have terminated as of the time of the first act that led or
would have led to the termination for cause or resignation
in lieu of dismissal and such Optionee shall thereupon have
no right to purchase any shares of Common Stock pursuant to
the exercise of such option, and any such exercise shall be
null and void. Termination for "cause" shall include: (i)
the violation by the Optionee of any reasonable rule or
policy of the Board of Directors or the Optionee's superiors
or the chief executive officer or the chief operating
officer of the Company that results in damage to the Company
or which, after notice to do so, the Optionee fails to
correct within a reasonable time; (ii) any willful
misconduct or gross negligence by the Optionee in the
responsibilities assigned to him or her; (iii) any willful
failure to perform his or her job as required to meet the
objectives of the Company; (iv) any wrongful conduct of an
Optionee that has an adverse impact on the Company or that
constitutes a misappropriation of the assets of the Company;
(v) unauthorized disclosure of confidential information; or
(vi) the Optionee's performing services for any other
company or person that competes with the Company while he or
she is employed by or provides services to the Company,
without the written approval of the chief executive officer
of the Company. "Resignation in lieu of dismissal" shall
mean a resignation by an Optionee of the employment with or
service to the Company if: (i) the Company has given prior
notice to such Optionee of its intent to dismiss the
Optionee for circumstances that constitute cause; or (ii)
within two months of the Optionee's resignation, the chief
operating officer or the chief executive officer of the
Company or the Board of Directors determines, which
determination shall be final and binding, that such
resignation was related to an act that would have led to a
termination for cause.
(ii) If an Optionee resigns from the Company, the right of the
Optionee to exercise his or her option shall be suspended
for a period of two months from the date of the resignation,
unless the chief executive officer of the Company or the
Board of Directors determines otherwise in writing.
Thereafter, unless there is a determination that the
Optionee resigned in lieu of dismissal, the option may be
exercised at any time before the earlier of: (i) the
expiration date of the option (which shall have been
similarly suspended); or (ii) the expiration of three months
after the date of resignation, for that portion of the
Optionee's option that was exercisable at the time of such
resignation (provided the conditions of Section 6.4 and
14
any other conditions specified in the Option Agreement shall
have been met at the date of exercise of such option).
(c) Retirement. Unless otherwise determined by the Plan
----------
Administrator, if an Optionee's employment or service with
the Company is terminated with the Company's approval for
reasons of age, the Option may be exercised at any time
before the earlier of: (a) the expiration date of the
option; or (b) the expiration of three months after the date
of such termination of employment or service (provided the
conditions of Section 6.4 and any other conditions specified
in the Option Agreement shall have been met at the date of
exercise of such option).
(d) Disability. Unless otherwise determined by the Plan
----------
Administrator, if an Optionee's employment or relationship
with the Company terminates because of a permanent or total
disability (as defined in Sections 22(e)(3) of the Code),
the option may be exercised at any time before the earlier
of: (a) the expiration date of the option; or (b) the
expiration of 12 months after the date of such termination,
for up to the full number of shares of Common Stock covered
thereby, including any portion not yet vested (provided the
conditions of Section 6.4 and any other conditions specified
in the Option Agreement shall have been met be the date of
exercise of such option).
(e) Death. Unless otherwise determined by the Plan
-----
Administrator, in the event of the death of an Optionee
while employed by or providing service to the Company, the
option may be exercised at any time before the earlier of:
(a) the expiration date of the option; or (b) the expiration
of 12 months after the date of death by the person or
persons to whom such Optionee's rights under the option
shall pass by the Optionee's will or by the applicable laws
of descent and distribution, for up to the full number of
shares of Common Stock covered thereby, including any
portion not yet vested (provided the conditions of Section
6.4 and any other conditions specified in the Option
Agreement shall have been met be the date of exercise of
such option).
(f) Extension of Exercise Period Applicable to Termination. The
------------------------------------------------------
Plan Administrator, at the time of grant or at any time
thereafter, may extend the one month, three month and 12
month exercise periods to any length of time not longer than
the original expiration date of the option, and may increase
the portion of an option that is exercisable, subject to
such terms and conditions as the Plan Administrator may
determine; provided, that any extension of the exercise
period or other modification of an Incentive Stock Option
shall be subject to the written agreement and acknowledgment
by the Optionee that the extension of modification
disqualifies the option as an Incentive Stock Option.
15
(g) Failure to Exercise Option. To the extent that the option of
--------------------------
any deceased Optionee or of any Optionee whose employment or
service terminates is not exercised within the applicable
period, all rights to purchase shares of Common Stock
pursuant to such options shall cease and terminate.
(h) Transfers; Leaves. For purposes of this Section 5.5, a
-----------------
transfer of employment or other relationship between or
among the Company and/or any subsidiaries shall not be
deemed to constitute a termination of employment or other
cessation of relationship with the Company or any of its
subsidiaries. For purposes of this Section 5.5, with respect
to Incentive Stock Options, employment shall be deemed to
continue while the Optionee is on military leave, sick leave
or other bona fide leave of absence (as determined by the
Plan Administrator) in accordance with the policies of the
Company.
6 Exercise.
--------
6.1 Procedure. Subject to the provisions of Section 5.3 above, each
---------
option may be exercised in whole or in part; provided, however,
that no fewer than 100 shares (or the remaining shares then
purchasable under the option, if less than 100 shares) may be
purchased on any exercise of any option granted hereunder and
that only whole shares will be issued pursuant to the exercise of
any option (the number of 100 shares shall not be changed by any
transaction or action described in Section 8 or Section 11 unless
the Plan Administrator determines that such a change is
appropriate). Options shall be exercised by delivery to the
Secretary of the Company or his or her designated agent of notice
of the number of shares with respect to which the option is
exercised, together with payment in full of the exercise price
and any applicable withholding taxes.
6.2 Payment. Payment of the option exercise price shall be made in
-------
full when the notice of exercise of the option is delivered to
the Secretary of the Company, or his or her designated agent, and
shall be in cash or bank certified or cashier's check or through
irrevocable instructions to a stock broker to deliver the amount
of sales proceeds necessary to pay the appropriate exercise price
and withholding tax obligations, all in accordance with
applicable governmental regulations, for the shares of Common
Stock being purchased. The Plan Administrator may determine at
the time the option is granted for Incentive Stock Options, or at
an time before exercise for Non-Qualified Stock Options, that
additional forms of payment will be permitted.
6.3 Withholding. Before the issuance of shares of Common Stock on the
-----------
exercise of an option, the Optionee shall pay to the Company the
amount of any applicable federal, state or local tax withholding
obligations. The Company may withhold any distribution in whole
or in part until the Company is so paid. The Company shall have
the right to withhold such amount from any
16
other amounts due or to become due from the Company to the
Optionee, including salary (subject to applicable law) or to
retain and withhold a number of shares having a market value not
less than the amount of such taxes required to be withheld by the
Company to reimburse it for any such taxes and cancel (in whole
or in part) any such shares so withheld.
6.4 Conditions Precedent to Exercise. The Plan Administrator may
--------------------------------
establish conditions precedent to the exercise of any option,
which shall be described in the relevant Option Agreement.
7 Foreign Qualified Grants. Options under this Plan may be granted to
------------------------
officers and employees of the Company and other persons described in
Section 4 who reside in foreign jurisdictions as the Plan
Administrator may determine from time to time. The Board of Directors
may adopt supplements to the Plan as needed to comply with the
applicable laws of such foreign jurisdictions and to give Options
favorable treatment under such laws; provided however, that no award
shall be granted under any such supplement on terms more beneficial to
such Optionees than those permitted by this Plan.
8 Corporate Mergers, Acquisitions, Etc. The Plan Administrator may also
------------------------------------
grant options under this Plan having terms, conditions and provisions
that vary from those specified in this Plan provided that such options
granted in substitution for, or in connection with the assumption of,
existing options granted, awarded or issued by another corporation and
assumed or otherwise agreed to be provided for by the Company pursuant
to or by reason of a transaction involving a corporate merger,
consolidation, acquisition of property or stock, reorganization or
liquidation to which the Company is a party.
9 Holding Period. Unless otherwise determined by the Plan Administrator,
--------------
if a person subject to Section 16 of the Exchange Act exercises an
option within six months of the date of grant of the option, the
shares of Common Stock acquired on exercise of the option may not be
sold until six months after the date of grant of the option.
10 Option Agreements. Options granted under this Plan shall be evidenced
-----------------
by written stock option agreements (the " Option Agreements") that
shall contain such terms, conditions, limitations and restrictions as
the Plan Administrator shall deem advisable and that are consistent
with this Plan. All Option Agreements shall include or incorporate by
reference the applicable terms and conditions contained in this Plan.
11 Adjustments On Changes in Capitalization.
----------------------------------------
11.1 Stock Splits, Capital Stock Adjustments. The aggregate number and
---------------------------------------
class of shares for which options may be granted under this Plan,
the number and class of shares covered by each outstanding option
and the exercise price per share thereof (but not the total
price), and each such option, shall be proportionately adjusted
for any increase or decrease in the number of issued shares of
17
Common Stock of the Company resulting from a stock split,
stock dividend or consolidation of shares or any like capital
stock adjustment.
11.2 Effect of Merger, Sale of Assets, Liquidation or Dissolution.
------------------------------------------------------------
(a) Mergers, Sale of Assets, Other Transactions. In the event
-------------------------------------------
of a merger, consolidation or plan of exchange to which the
Company is a party or a sale of all or substantially all of
Company's assets (each, a "Transaction") the Board of
Directors, in its sole discretion and to the extent
possible under the structure of the Transaction, shall
select one of the following alternatives for treating
outstanding options under this Plan.
(i) Outstanding options shall remain in effect in accordance
with their terms;
(ii) Outstanding options shall be converted into options to
purchase stock in the corporation that is the surviving or
acquiring corporation in the Transaction. The amount, type
of securities subject thereto and exercise price of the
converted options shall be determined by the Board of
Directors of the Company, taking into account the relative
values of the companies involved in the Transaction and the
exchange rate, if any, used in determining shares of the
surviving corporation to be issued to holders of shares of
the Company. Unless otherwise determined by the Board of
Directors, the converted options shall be vested only to
the extent that the vesting requirements relating to
options granted hereunder have been satisfied;
(iii) The Board of Directors provides a period before the
consummation of the Transaction during which outstanding
options shall be exercisable to the extent vested and, on
the expiration of such period, all unexercised options
shall immediately terminate. The Board of Directors, in its
sole discretion, may accelerate the vesting of such options
so that they are exercisable in full during such period; or
(iv) The Board of Directors shall take such other action with
respect to outstanding options as the Board deems to be in
the best interests of the Company.
(b) Liquidation, Dissolution. If the Company is liquidated or
------------------------
dissolved, options shall be treated in accordance with
Section 11.2 (a) (iii).
11.3 Fractional Shares. If the number of shares covered by any
-----------------
option is adjusted, any fractional shares resulting from such
adjustment shall be disregarded and each such option shall
cover only the number of full shares resulting from such
adjustment.
18
11.4 Determination of Board to Be Final. All adjustments under this
----------------------------------
Section 11 shall be made by the Board of Directors, and its
determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive. Unless
an Optionee agrees otherwise, any change or adjustment to an
Incentive Stock Option shall be made, if possible, in such a
manner so as not to constitute a "modification", as defined in
Section 424(h) of the Code, and so as not to cause the
Optionee's Incentive Stock Option to fail to continue to
qualify as an Incentive Stock Option.
12 Securities Regulations. Shares of Common Stock shall not be issued
----------------------
with respect to an option granted under this Plan 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, any applicable state securities laws, the
Securities Act of 1933, as amended, the Exchange Act, the rules and
regulations promulgated thereunder, applicable laws of foreign
countries and other jurisdictions and the requirements of any
quotation service or stock exchange on 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, including the
availability of an exemption from registration for the issuance and
sale of any shares hereunder. The inability of the Company to obtain,
from any regulatory body having jurisdiction, the authority deemed by
the Company's counsel to be necessary for the lawful issuance and sale
of any shares hereunder or the unavailability of an exemption from
registration for the issuance and sale of any shares hereunder shall
relieve the Company of any liability with respect of the non-issuance
or sale of such shares as to which such requisite authority shall not
have been obtained.
As a condition to the exercise of an option, the Company may
require the Optionee to represent and warrant at the time of any such
exercise that the shares of Common Stock are being purchased only for
investment and without any present intention to sell or distribute
such shares if, in the option of counsel for the Company, such a
representation is required by any relevant provision of the
aforementioned laws. The Company may place a stop-transfer order
against any shares of Common Stock on the official stock books and the
records of the Company, and a legend may be stamped on stock
certificates to the effect that the shares of Common Stock may not be
pledged, sold or otherwise transferred unless an option of counsel is
provided (concurred in by counsel for the Company) stating that such
transfer is not in violation of any applicable law or regulation. The
Plan Administrator may also require such other action or agreement by
the Optionees as may from time to time be necessary to comply with the
federal and state securities laws. THE PROVISION SHALL NOT OBLIGATE
THE COMPANY TO UNDERTAKE REGISTRATION OF THE OPTIONS OR STOCK
THEREUNDER.
If any of the Company's capital stock of the same class as the
Common Stock subject to options is granted hereunder is listed on a
national securities exchange, all shares of Common Stock issued
hereunder if not previously listed on such exchange shall be
authorized by that exchange for listing thereon before the issuance
thereof.
19
13 Amendment and Termination.
-------------------------
13.1 Plan. The Board of Directors may at any time suspend, amend
----
or terminate this Plan, provided that, except as set forth
in Section 8, the approval of the Company's shareholders is
necessary within twelve months before or after the adoption
by the Board of Directors of any amendment that will:
(a) increase the number of shares of Common Stock to be reserved
for the issuance of options under this Plan;
(b) permit the granting of stock options to a class of persons
other than those now permitted to receive stock options
under this Plan; or
(c) require shareholder approval under applicable law, including
Section 16(b) of the Exchange Act.
13.2 Options. Subject to the requirements of Section 422 of the
-------
Code with respect to Incentive Stock Options and to the
terms and conditions and within the limitation of this Plan,
the Plan Administrator may modify or amend outstanding
options granted under this Plan. The modification or
amendment of an outstanding option shall not, without the
consent of the Optionee, impair or diminish any of his or
her rights or any of the obligations of the Company under
such option. Except as otherwise provided in this Plan, no
outstanding option shall be terminated without the consent
of the Optionee. Unless the Optionee agrees otherwise, any
changes or adjustments made to outstanding Incentive Stock
Options granted under this Plan shall be made in such a
manner so as not to constitute a "modification", as defined
in Section 425(h) of the Code, and so as not to cause any
Incentive Stock Option issued hereunder to fail to continue
to qualify as an Incentive Stock Option as defined in
Section 422(b) of the Code.
13.3 Automatic Termination. Unless sooner terminated by the Board
---------------------
of Directors, this Plan shall terminate ten years from the
date on which this Plan is adopted by the Board. No option
may be granted after such termination or during any
suspension of this Plan. The amendment or termination of
this Plan shall not, without the consent of the Optionee,
alter or impair any rights or obligations under any option
theretofore granted under this Plan.
14 Miscellaneous.
--------------
14.1 Time of Granting Options. The date of grant of an option
------------------------
shall, for all purposes, be the date on which the Company
completes the required corporate action relating to the
grant of an option; the execution of an Option Agreement and
the conditions to the exercise of an option shall not defer
the date of grant.
20
14.2 No Status as Shareholder. Neither the Optionee nor any party to
------------------------
which the Optionee's rights and privileges under the option may
pass shall be, or have any of the rights or privileges or, a
shareholder of the Company with respect to any of the shares of
Common Stock issueable on the exercise of any option granted
under this Plan unless and until such option has been exercised
and the issuance (as evidenced by the appropriate entry on the
books of the Company or duly authorized transfer agent of the
Company) of the stock certificate evidencing such shares.
14.3 Status as an Employee. Nothing in this Plan or any option
---------------------
granted pursuant to this Plan shall confer on any Optionee any
right to continue in the employ of the Company, or to interfere
in any way with the right of the Company to terminate his or
her employment or other relationship with the company at any
time.
14.4 Reservation of Shares. The Company, during the term of this
---------------------
Plan, at all times will reserve and keep available such number
of shares of Common Stock as shall be sufficient to satisfy the
requirements of this Plan.
15 Effectiveness of This Plan. This Plan shall become effective on the
---------------------------
date on which it is adopted by the Board of Directors of the Company
(the "Effective Date"). No option granted under this Plan to any
officer or director of the company shall become exercisable until the
Plan is approved by the shareholders, and any option granted before
such approval shall be conditioned on and is subject to such approval.
Adopted by the Board of Directors on February 1, 2001
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE APPROVAL OF THE
COMPANY'S 2000 COMBINED INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN
PROPOSAL FOUR - ROLL BACK THE ISSUED AND OUTSTANDING
SHARES OF THE COMPANY 10:1
After researching the market, the Board of Directors have established that the
Company has been unable to raise any capital due to the current share structure.
The Board of Directors believe that it would be in the best interest of the
Company to perform a Roll Back of the Issued and Outstanding shares of the
Company 10:1 without further Shareholder approval.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE APPROVAL OF THE
AUTHORIZATION TO ROLL BACK THE ISSUED AND OUTSTANDING SHARES OF THE COMPANY
10:1.
21
GENERAL
Any other business that may be lawfully brought before the Annual Meeting.
OTHER ITEMS
Annual Report to Shareholders
The Company is forwarding to each beneficial shareholder as of July 20, 2001 a
copy of the Company's Annual Report based on the Registration Statement filed by
the Company on Form 10-KSB as filed with the Securities and Exchange Commission
on April 30, 2001, except exhibits thereto. However, shareholders who wish to
obtain copies of the exhibits, may by written request to the Company obtain a
copy of such exhibits upon payment of a reasonable fee the Company may impose
for providing such exhibits. Requests for copies of the Exhibits to the
Company's Form 10KSB should be mailed to:
Explore Technologies Inc.
#201-1166 Alberni Street
Vancouver BC V6E 3Z3
Attention: Rod Jao
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities and Exchange Act of 1934 requires that the
Company's Executive Officers and Directors and persons who beneficially own more
than ten percent of the Company's Common Stock, file initial reports of stock
ownership and reports of changes in stock ownership with the Securities and
Exchange Commission. Officers, Directors and greater than ten-percent owners
are required by applicable regulations to furnish the Company with copies of all
section 16(a) forms that they file.
Shareholder Proposals
In order for a shareholder's proposal to be considered for inclusion in the
Company's proxy materials for the 2002 Annual Meeting of Shareholders, the
proposal must be received by the Company's Secretary at the above address no
later than February 1, 2002 and must otherwise comply with the requirements of
Rule 14a-8 of the Securities and Exchange Act of 1934 as amended.
Proposals of shareholders submitted for consideration at the Company's 2001
Annual Meeting other than those submitted for inclusion in the Company's proxy
material pursuant to Rule 14a-8, must be delivered to the Company's Secretary no
later than February 1, 2001. If such timely notice of a shareholder's proposal
is not given, the Company's Proxy Holder may exercise discretionary voting
authority to vote on the proposal when and if it is raised at the 2001 Annual
Meeting.
By Order of the Board of Directors
/s/ Rod Jao
Rod Jao
Chief Executive Officer
22
EXPLORE TECHNOLOGIES, INC. PROXY
#201-1166 Alberni Street
Vancouver BC Canada V6E 3Z3
ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD MONDAY, AUGUST 27, 2001
The undersigned shareholder hereby appoints Rod Jao or Keith Andrews as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them, or either of them, to represent and to vote, as designated below, all of
the shares of common stock of Explore Technologies Inc. held on July 20, 2001
(the Record Date) at the Company's Annual General Meeting to be held on August
27, 2001 at 1:00 pm (Pacific Standard Time) at the Renaissance Madison Hotel,
515 Madison Street, Seattle, Washington, 98104 and at any continuation(s) or
adjournment(s) thereof. The proposals listed below are made by the Board of
Directors.
1. ELECTION OF DIRECTORS
[_] FOR all nominees listed below [_] WITHHOLD AUTHORITY
(except as marked to the contrary below) to vote for all nominees listed
below
(To withhold authority to vote for any individual nominee, strike a line through
the nominee's name in the list below.)
Keith Andrews Rod Jao Cecil Morris
2. APPOINTMENT OF MORGAN & CO. AS INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS FOR
THE FISCAL YEAR ENDING JANUARY 31, 2002
[_] FOR [_] AGAINST [_] ABSTAIN
3. RATIFY AND APPROVE THE COMPANY'S 2000 COMBINED INCENTIVE AND NONQUALIFIED
STOCK OPTION PLAN
[_] FOR [_] AGAINST [_] ABSTAIN
4. AUTHORIZE THE BOARD OF DIRECTORS TO ROLL BACK THE ISSUED AND OUTSTANDING
SHARES OF THE COMPANY 10:1 AT THEIR DISCRETION WITHOUT FURTHER SHAREHOLDER
APPROVAL
[_] FOR [_] AGAINST [_] ABSTAIN
5. The Proxies are authorized to vote, in their discretion, upon such other
matters as may properly come before the meeting, provided the Company did
not have notice of such matter on or before June 15, 2001.
This Proxy, when properly executed, will be voted in the manner directed by
the undersigned shareholder. If no direction is given, then this Proxy will be
voted FOR all nominees for director listed in Proposal 1 and FOR Proposals 2, 3,
4 and 5.
Please sign exactly as your name appears on the records of the Company's
transfer agent. When shares are held jointly, each person should sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title as such. If a Corporation, please sign in the full corporate name by
the President or other authorized officer. If a partnership, please sign in the
partnership name by an authorized person.
DATED:_______________, 2001 ________________________________________________________________
Name of entity which owns the shares if other than an individual
__________________________________________ ________________________________________________________________
Signature (if signing individually) Signature of authorized signatory
__________________________________________ ________________________________________________________________
Additional Signature if held jointly Title of authorized signatory