Exhibit 10.13
CROWN PARTNERS, INC.
NON-EMPLOYEE DIRECTORS, ADVISORS AND CONSULTANTS RETAINER STOCK PLAN FOR 2004
1. Introduction. This Plan shall be known as the "CROWN PARTNERS, INC.
Non-Employee Directors and Consultants Retainer Stock Plan for the Year 2004"
and is hereinafter referred to as the "Plan." The purposes of this Plan are to
enable Crown Partners, Inc., a Nevada corporation (the "Company"), to promote
the interests of the Company and its stockholders by attracting and retaining
non-employee Directors, Advisors, and Consultants capable of furthering the
future success of the Company and by aligning their economic interests more
closely with those of the Company's stockholders, by paying their retainer or
fees in the form of shares of the Company's common stock, par value $0.001 per
share (the "Common Stock").
2. Definitions. The following terms shall have the meanings set forth
below:
"Board" means the Board of Directors of the Company.
"Change of Control" has the meaning set forth in Paragraph 12(d) hereof.
"Code" means the Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder. References to any provision of the Code or rule or
regulation thereunder shall be deemed to include any amended or successor
provision, rule or regulation.
"Committee" means the committee that administers this Plan, as more fully
defined in Paragraph 13 hereof.
"Common Stock" has the meaning set forth in Paragraph 1 hereof.
"Company" has the meaning set forth in Paragraph 1 hereof.
"Deferral Election" has the meaning set forth in Paragraph 6 hereof.
"Deferred Stock Account" means a bookkeeping account maintained by the Company
for a Participant representing the Participant's interest in the shares credited
to such Deferred Stock Account pursuant to Paragraph 7 hereof.
"Delivery Date" has the meaning set forth in Paragraph 6 hereof.
"Director" means an individual who is a member of the Board of Directors of the
Company.
"Dividend Equivalent" for a given dividend or other distribution means a number
of shares of the Common Stock having a Fair Market Value, as of the record date
for such dividend or distribution, equal to the amount of cash, plus the Fair
Market Value on the date of distribution of any property, that is distributed
with respect to one share of the Common Stock pursuant to such dividend or
distribution; such Fair Market Value to be determined by the Committee in good
faith.
"Effective Date" has the meaning set forth in Paragraph 3 hereof.
"Exchange Act" has the meaning set forth in Paragraph 13(b) hereof.
"Fair Market Value" means the mean between the highest and lowest reported sales
prices of the Common Stock on the New York Stock Exchange Composite Tape or, if
not listed on such exchange, on any other national securities exchange on which
the Common Stock is listed or on the Nasdaq Stock Market, or, if not so listed
on any other national securities exchange or the Nasdaq Stock Market, then the
average of the bid price of the Common Stock during the last five trading days
on the OTC Bulletin Board immediately preceding the last trading day prior to
the date with respect to which the Fair Market Value is to be determined. If the
Common Stock is not then publicly traded, then the Fair Market Value of the
Common Stock shall be the book value of the Company per share as determined on
the last day of March, June, September, or December in any year closest to the
date when the determination is to be made. For the purpose of determining book
value hereunder, book value shall be determined by adding as of the applicable
date called for herein the capital, surplus, and undivided profits of the
Company, and after having deducted any reserves theretofore established; the sum
of these items shall be divided by the number of shares of the Common Stock
outstanding as of said date, and the quotient thus obtained shall represent the
book value of each share of the Common Stock of the Company.
"Participant" has the meaning set forth in Paragraph 4 hereof.
"Payment Time" means the time when a Stock Retainer is payable to a Participant
pursuant to Paragraph 5 hereof (without regard to the effect of any Deferral
Election).
"Stock Retainer" has the meaning set forth in Paragraph 5 hereof.
"Third Anniversary" has the meaning set forth in Paragraph 6 hereof.
3. Effective Date of the Plan. This Plan was adopted by the Board
effective January 1, 2004 (the "Effective Date").
4. Eligibility. Each individual who is a Director, Advisor or
Consultant on the Effective Date and each individual who becomes a Director,
Advisor or Consultant thereafter during the term of this Plan, shall be a
participant (the "Participant") in this Plan, in each case during such period as
such individual remains a Director or Consultant and is not an employee of the
Company or any of its subsidiaries. Each credit of shares of the Common Stock
pursuant to this Plan shall be evidenced by a written agreement duly executed
and delivered by or on behalf of the Company and a Participant, if such an
agreement is required by the Company to assure compliance with all applicable
laws and regulations.
5. Grants of Shares. Commencing on the Effective Date, the amount of
compensation for service to directors, advisors or consultants shall be payable
in shares of the Common Stock (the "Stock Retainer") pursuant to this Plan at
the deemed issuance price of $0.05 per Share.
6. Deferral Option. From and after the Effective Date, a Participant
may make an election (a "Deferral Election") on an annual basis to defer
delivery of the Stock Retainer specifying which one of the following ways the
Stock Retainer is to be delivered (a) on the date which is three years after the
Effective Date for which it was originally payable (the "Third Anniversary"),
(b) on the date upon which the Participant ceases to be a Director or Consultant
for any reason (the "Departure Date") or (c) in five equal annual installments
commencing on the Departure Date (the "Third Anniversary" and "Departure Date"
each being referred to herein as a "Delivery Date"). Such Deferral Election
shall remain in effect for each Subsequent Year unless changed, provided that,
any Deferral Election with respect to a particular Year may not be changed less
than six months prior to the beginning of such Year, and provided, further, that
no more than one Deferral Election or change thereof may be made in any Year.
Any Deferral Election and any change or revocation thereof shall be
made by delivering written notice thereof to the Committee no later than six
months prior to the beginning of the Year in which it is to be effected;
provided that, with respect to the Year beginning on the Effective Date, any
Deferral Election or revocation thereof must be delivered no later than the
close of business on the 30th day after the Effective Date.
7. Deferred Stock Accounts. The Company shall maintain a Deferred Stock
Account for each Participant who makes a Deferral Election to which shall be
credited, as of the applicable Payment Time, the number of shares of the Common
Stock payable pursuant to the Stock Retainer to which the Deferral Election
relates. So long as any amounts in such Deferred Stock Account have not been
delivered to the Participant under Paragraph 8 hereof, each Deferred Stock
Account shall be credited as of the payment date for any dividend paid or other
distribution made with respect to the Common Stock, with a number of shares of
the Common Stock equal to (a) the number of shares of the Common Stock shown in
such Deferred Stock Account on the record date for such dividend or distribution
multiplied by (b) the Dividend Equivalent for such dividend or distribution.
8. Delivery of Shares. (a) The shares of the Common Stock in a
Participant's Deferred Stock Account with respect to any Stock Retainer for
which a Deferral Election has been made (together with dividends attributable to
such shares credited to such Deferred Stock Account) shall be delivered in
accordance with this Paragraph 8 as soon as practicable after the applicable
Delivery Date. Except with respect to a Deferral Election pursuant to Paragraph
6(c) hereof, or other agreement between the parties, such shares shall be
delivered at one time; provided that, if the number of shares so delivered
includes a fractional share, such number shall be rounded to the nearest whole
number of shares. If the Participant has in effect a Deferral Election pursuant
to Paragraph 6(c) hereof, then such shares shall be delivered in five equal
annual installments (together with dividends attributable to such shares
credited to such Deferred Stock Account), with the first such installment being
delivered on the first anniversary of the Delivery Date; provided that, if in
order to equalize such installments, fractional shares would have to be
delivered, such installments shall be adjusted by rounding to the nearest whole
share. If any such shares are to be delivered after the Participant has died or
become legally incompetent, they shall be delivered to the Participant's estate
or legal guardian, as the case may be, in accordance with the foregoing;
provided that, if the Participant dies with a Deferral Election pursuant to
Paragraph 6(c) hereof in effect, the Committee shall deliver all remaining
undelivered shares to the Participant's estate immediately. References to a
Participant in this Plan shall be deemed to refer to the Participant's estate or
legal guardian, where appropriate.
(b) The Company may, but shall not be required to, create a grantor
trust or utilize an existing grantor trust (in either case, "Trust") to assist
it in accumulating the shares of the Common Stock needed to fulfill its
obligations under this Paragraph 8. However, Participants shall have no
beneficial or other interest in the Trust and the assets thereof, and their
rights under this Plan shall be as general creditors of the Company, unaffected
by the existence or nonexistence of the Trust, except that deliveries of Stock
Retainers to Participants from the Trust shall, to the extent thereof, be
treated as satisfying the Company's obligations under this Paragraph 8.
9. Share Certificates; Voting and Other Rights. The certificates for
shares delivered to a Participant pursuant to Paragraph 8 above shall be issued
in the name of the Participant, and from and after the date of such issuance the
Participant shall be entitled to all rights of a stockholder with respect to the
Common Stock for all such shares issued in his name, including the right to vote
the shares, and the Participant shall receive all dividends and other
distributions paid or made with respect thereto.
10. General Restrictions.
(a) Notwithstanding any other provision of this Plan or agreements made
pursuant thereto, the Company shall not be required to issue or deliver any
certificate or certificates for shares of the Common Stock under this Plan prior
to fulfillment of all of the following conditions:
(i) Listing or approval for listing upon official notice of issuance of
such shares on the New York Stock Exchange, Inc., or such other
securities exchange as may at the time be a market for the Common
Stock;
(ii) Any registration or other qualification of such shares under any
state or federal law or regulation, or the maintaining in effect of any
such registration or other qualification which the Committee shall,
upon the advice of counsel, deem necessary or advisable; and
(iii) Obtaining any other consent, approval, or permit from any state
or federal governmental agency which the Committee shall, after
receiving the advice of counsel, determine to be necessary or
advisable.
(b) Nothing contained in this Plan shall prevent the Company from
adopting other or additional compensation arrangements for the Participants.
11. Shares Available. Subject to Paragraph 12 below, the maximum number
of shares of the Common Stock which may in the aggregate be paid as Stock
Retainers pursuant to this Plan is 1,000,000. Shares of the Common Stock
issuable under this Plan may be taken from treasury shares of the Company or
purchased on the open market.
12. Adjustments; Change of Control.
(a) In the event that there is, at any time after the Board adopts this
Plan, any change in corporate capitalization, such as a stock split, combination
of shares, exchange of shares, warrants or rights offering to purchase the
Common Stock at a price below its Fair Market Value, reclassification, or
recapitalization, or a corporate transaction, such as any merger, consolidation,
separation, including a spin-off, stock dividend, or other extraordinary
distribution of stock or property of the Company, any reorganization (whether or
not such reorganization comes within the definition of such term in Section 368
of the Code) or any partial or complete liquidation of the Company (each of the
foregoing a "Transaction"), in each case other than any such Transaction which
constitutes a Change of Control (as defined below), (i) the Deferred Stock
Accounts shall be credited with the amount and kind of shares or other property
which would have been received by a holder of the number of shares of the Common
Stock held in such Deferred Stock Account had such shares of the Common Stock
been outstanding as of the effectiveness of any such Transaction, (ii) the
number and kind of shares or other property subject to this Plan shall likewise
be appropriately adjusted to reflect the effectiveness of any such Transaction,
and (iii) the Committee shall appropriately adjust any other relevant provisions
of this Plan and any such modification by the Committee shall be binding and
conclusive on all persons.
(b) If the shares of the Common Stock credited to the Deferred Stock
Accounts are converted pursuant to Paragraph 12(a) into another form of
property, references in this Plan to the Common Stock shall be deemed, where
appropriate, to refer to such other form of property, with such other
modifications as may be required for this Plan to operate in accordance with its
purposes. Without limiting the generality of the foregoing, references to
delivery of certificates for shares of the Common Stock shall be deemed to refer
to delivery of cash and the incidents of ownership of any other property held in
the Deferred Stock Accounts.
(c) In lieu of the adjustment contemplated by Paragraph 12(a), in the
event of a Change of Control, the following shall occur on the date of the
Change of Control (i) the shares of the Common Stock held in each Participant's
Deferred Stock Account shall be deemed to be issued and outstanding as of the
Change of Control; (ii) the Company shall forthwith deliver to each Participant
who has a Deferred Stock Account all of the shares of the Common Stock or any
other property held in such Participant's Deferred Stock Account; and (iii) this
Plan shall be terminated.
(d) For purposes of this Plan, Change of Control shall mean any of the
following events:
(i) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20 percent or more of either (1) the then outstanding
shares of the Common Stock of the Company (the "Outstanding Company
Common Stock", or (2) the combined voting power of then outstanding
voting securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Company Voting Securities");
provided, however, that the following acquisitions shall not constitute
a Change of Control (A) any acquisition directly from the Company
(excluding an acquisition by virtue of the exercise of a conversion
privilege unless the security being so converted was itself acquired
directly from the Company), (B) any acquisition by the Company, (C) any
acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the
Company or (D) any acquisition by any corporation pursuant to a
reorganization, merger or consolidation, if, following such
reorganization, merger or consolidation, the conditions described in
clauses (A), (B) and (C) of paragraph (iii) of this Paragraph 12(d) are
satisfied; or
(ii) Individuals who, as of the date hereof, constitute the Board of
the Company (as of the date hereof, "Incumbent Board") cease for any
reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the date
hereof whose election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board; or
(iii) Approval by the stockholders of the Company of a reorganization,
merger, binding share exchange or consolidation, unless, following such
reorganization, merger, binding share exchange or consolidation (1)
more than 60 percent of, respectively, then outstanding shares of
common stock of the corporation resulting from such reorganization,
merger, binding share exchange or consolidation and the combined voting
power of then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all
of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such reorganization,
merger, binding share exchange or consolidation in substantially the
same proportions as their ownership, immediately prior to such
reorganization, merger, binding share exchange or consolidation, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, (2) no Person (excluding the Company,
any employee benefit plan (or related trust) of the Company or such
corporation resulting from such reorganization, merger, binding share
exchange or consolidation and any Person beneficially owning,
immediately prior to such reorganization, merger, binding share
exchange or consolidation, directly or indirectly, 20 percent or more
of the Outstanding Company Common Stock or Outstanding Company Voting
Securities, as the case may be) beneficially owns, directly or
indirectly, 20 percent or more of, respectively, then outstanding
shares of common stock of the corporation resulting from such
reorganization, merger, binding share exchange or consolidation or the
combined voting power of then outstanding voting securities of such
corporation entitled to vote generally in the election of directors,
and (3) at least a majority of the members of the board of directors of
the corporation resulting from such reorganization, merger, binding
share exchange or consolidation were members of the Incumbent Board at
the time of the execution of the initial agreement providing for such
reorganization, merger, binding share exchange or consolidation; or
(iv) Approval by the stockholders of the Company of (1) a complete
liquidation or dissolution of the Company, or (2) the sale or other
disposition of all or substantially all of the assets of the Company,
other than to a corporation, with respect to which following such sale
or other disposition, (A)more than 60 percent of, respectively, then
outstanding shares of common stock of such corporation and the combined
voting power of then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all
of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such sale or other
disposition in substantially the same proportion as their ownership,
immediately prior to such sale or other disposition, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the
case may be, (B) no Person (excluding the Company and any employee
benefit plan (or related trust) of the Company or such corporation and
any Person beneficially owning, immediately prior to such sale or other
disposition, directly or indirectly, 20 percent or more of the
Outstanding Company Common Stock or Outstanding Company Voting
Securities, as the case may be) beneficially owns, directly or
indirectly, 20 percent or more of, respectively, then outstanding
shares of common stock of such corporation and the combined voting
power of then outstanding voting securities of such corporation
entitled to vote generally in the election of directors, and (3) at
least a majority of the members of the board of directors of such
corporation were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for
such sale or other disposition of assets of the Company.
13. Administration; Amendment and Termination.
(a) This Plan shall be administered by a committee consisting of two
members who shall be the current directors of the Company or senior executive
officers or other directors who are not Participants as may be designated by the
Chief Executive Officer (the "Committee"), which shall have full authority to
construe and interpret this Plan, to establish, amend and rescind rules and
regulations relating to this Plan, and to take all such actions and make all
such determinations in connection with this Plan as it may deem necessary or
desirable.
(b) The Board may from time to time make such amendments to this Plan,
including to preserve or come within any exemption from liability under Section
16(b) of the Exchange Act, as it may deem proper and in the best interest of the
Company without further approval of the Company's stockholders, provided that,
to the extent required under Nevada law or to qualify transactions under this
Plan for exemption under Rule 16b-3 promulgated under the Exchange Act, no
amendment to this Plan shall be adopted without further approval of the
Company's stockholders and, provided, further, that if and to the extent
required for this Plan to comply with Rule 16b-3 promulgated under the Exchange
Act, no amendment to this Plan shall be made more than once in any six month
period that would change the amount, price or timing of the grants of the Common
Stock hereunder other than to comport with changes in the Code, the Employee
Retirement Income Security Act of 1974, as amended, or the regulations
thereunder. The Board may terminate this Plan at any time by a vote of a
majority of the members thereof.
14. Miscellaneous.
(a) Nothing in this Plan shall be deemed to create any obligation on
the part of the Board to nominate any Director for reelection by the Company's
stockholders or to limit the rights of the stockholders to remove any Director.
(b) The Company shall have the right to require, prior to the issuance
or delivery of any shares of the Common Stock pursuant to this Plan, that a
Participant make arrangements satisfactory to the Committee for the withholding
of any taxes required by law to be withheld with respect to the issuance or
delivery of such shares, including, without limitation, by the withholding of
shares that would otherwise be so issued or delivered, by withholding from any
other payment due to the Participant, or by a cash payment to the Company by the
Participant.
14.1 Governing Law. The Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Nevada.
14.2 Information to Shareholders. The Company shall furnish to each of
its stockholders financial statements of the Company at least annually.
IN WITNESS WHEREOF, this Plan has been executed effective as of January 1, 2004.
CROWN PARTNERS, INC.
By: /s/ John Bonaventura
-----------------------------------
John Bonaventura, President