Exhibit 4.1
UNITED TRADING.COM
EMPLOYEE STOCK INCENTIVE PLAN FOR THE YEAR 2002
1. General Provisions.
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1.1 Purpose. This United Trading.Com Employee Stock Incentive Plan for the Year
2002 (the "Plan") is intended to allow designated officers, employees and
certain non-employees (all of whom are sometimes collectively referred to herein
as the "Employees," or individually as the "Employee") of United Trading.Com, a
Nevada corporation ("United Trading.Com") and its Subsidiaries (as that term is
defined below) which they may have from time to time (United Trading.Com and
such Subsidiaries are referred to herein as the "Company") to receive certain
options (the "Stock Options") to purchase United Trading.Com common stock, par
value $0.001 per share (the "Common Stock"), and to receive grants of the Common
Stock subject to certain restrictions (the "Awards"). As used in this Plan, the
term "Subsidiary" shall mean each corporation which is a "subsidiary
corporation" of United Trading.Com within the meaning of Section 424(f) of the
Internal Revenue Code of 1986, as amended (the "Code"). The purpose of this Plan
is to provide the Employees with equity-based compensation incentives who make
significant and extraordinary contributions to the long-term growth and
performance of the Company, and to attract and retain the Employees.
1.2 Administration.
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1.2.1 The Plan shall be administered by the Compensation Committee (the
"Committee") of, or appointed by, the Board of Directors of United Trading.Com
(the "Board"). The Committee shall select one of its members as Chairman and
shall act by vote of a majority of a quorum, or by unanimous written consent. A
majority of its members shall constitute a quorum. The Committee shall be
governed by the provisions of United Trading.Com's Bylaws and of Nevada law
applicable to the Board, except as otherwise provided herein or determined by
the Board.
1.2.2 The Committee shall have full and complete authority, in its discretion,
but subject to the express provisions of this Plan (a) to approve the Employees
nominated by the management of the Company to be granted Awards or Stock
Options; (b) to determine the number of Awards or Stock Options to be granted to
an Employee; (c) to determine the time or times at which Awards or Stock Options
shall be granted; to establish the terms and conditions upon which Awards or
Stock Options may be exercised; (d) to remove or adjust any restrictions and
conditions upon Awards or Stock Options; (e) to specify, at the time of grant,
provisions relating to exercisability of Stock Options and to accelerate or
otherwise modify the exercisability of any Stock Options; and (f) to adopt such
rules and regulations and to make all other determinations deemed necessary or
desirable for the administration of this Plan. All interpretations and
constructions of this Plan by the Committee, and all of its actions hereunder,
shall be binding and conclusive on all persons for all purposes.
1.2.3 The Company hereby agrees to indemnify and hold harmless each Committee
member and each Employee, and the estate and heirs of such Committee member or
Employee, against all claims, liabilities, expenses, penalties, damages or other
pecuniary losses, including legal fees, which such Committee member or Employee,
his estate or heirs may suffer as a result of his responsibilities, obligations
or duties in connection with this Plan, to the extent that insurance, if any,
does not cover the payment of such items. No member of the Committee or the
Board shall be liable for any action or determination made in good faith with
respect to this Plan or any Award or Stock Option granted pursuant to this Plan.
1.3 Eligibility and Participation. The Employees eligible under this Plan shall
be approved by the Committee from those Employees who, in the opinion of the
management of the Company, are in positions which enable them to make
significant contributions to the long-term performance and growth of the
Company. In selecting the Employees to whom Award or Stock Options may be
granted, consideration shall be given to factors such as employment position,
duties and responsibilities, ability, productivity, length of service, morale,
interest in the Company and recommendations of supervisors.
1.4 Shares Subject to this Plan. The maximum number of shares of the Common
Stock that may be issued pursuant to this Plan shall be 1,000,000 subject to
adjustment pursuant to the provisions of Paragraph 4.1. If shares of the Common
Stock awarded or issued under this Plan are reacquired by the Company due to a
forfeiture or for any other reason, such shares shall be cancelled and
thereafter shall again be available for purposes of this Plan. If a Stock Option
expires, terminates or is cancelled for any reason without having been exercised
in full, the shares of the Common Stock not purchased thereunder shall again be
available for purposes of this Plan.
2. Provisions Relating to Stock Options.
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2.1 Grants of Stock Options. The Committee may grant Stock Options in such
amounts, at such times, and to the Employees nominated by the management of the
Company as the Committee, in its discretion, may determine. Stock Options
granted under this Plan shall constitute "incentive stock options" within the
meaning of Section 422 of the Code, if so designated by the Committee on the
date of grant. The Committee shall also have the discretion to grant Stock
Options which do not constitute incentive stock options, and any such Stock
Options shall be designated non-statutory stock options by the Committee on the
date of grant. The aggregate fair market value (determined as of the time an
incentive stock option is granted) of the Common Stock with respect to which
incentive stock options are exercisable for the first time by any Employee
during any one calendar year (under all plans of the Company and any parent or
subsidiary of the Company) may not exceed the maximum amount permitted under
Section 422 of the Code (currently, $100,000.00)). Non-statutory stock options
shall not be subject to the limitations relating to incentive stock options
contained in the preceding sentence. Each Stock Option shall be evidenced by a
written agreement (the "Option Agreement") in a form approved by the Committee,
which shall be executed on behalf of the Company and by the Employee to whom the
Stock Option is granted, and which shall be subject to the terms and conditions
of this Plan. In the discretion of the Committee, Stock Options may include
provisions (which need not be uniform), authorized by the Committee in its
discretion, that accelerate an Employee's rights to exercise Stock Options
following a "Change in Control," upon termination of the Employee's employment
by the Company without "Cause" or by the Employee for "Good Reason," as such
terms are defined in Paragraph 3.1 hereof. The holder of a Stock Option shall
not be entitled to the privileges of stock ownership as to any shares of the
Common Stock not actually issued to such holder.
2.2 Purchase Price. The purchase price (the "Exercise Price") of shares of the
Common Stock subject to each Stock Option (the "Option Shares") shall not be
less than 75 percent of the fair market value of the Common Stock on the date of
exercise. For an Employee holding greater than 10 percent of the total voting
power of all stock of the Company, either Common or Preferred, the Exercise
Price of an incentive stock option shall be at least 110 percent of the fair
market value of the Common Stock on the date of the grant of the option.
2.3 Option Period. The Stock Option period (the "Term") shall commence on the
date of grant of the Stock Option and shall be 10 years or such shorter period
as is determined by the Committee. Each Stock Option shall provide that it is
exercisable over its term in such periodic installments as the Committee in its
sole discretion may determine. Such provisions need not be uniform. Section
16(b) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
exempts persons normally subject to the reporting requirements of Section 16(a)
of the Exchange Act (the "Section 16 Reporting Persons") pursuant to a qualified
employee stock option plan from the normal requirement of not selling until at
least six months and one day from the date the Stock Option is granted.
2.4 Exercise of Options.
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2.4.1 Each Stock Option may be exercised in whole or in part (but not as to
fractional shares) by delivering it for surrender or endorsement to the Company,
attention of the Corporate Secretary, at the principal office of the Company,
together with payment of the Exercise Price and an executed Notice and Agreement
of Exercise in the form prescribed by Paragraph 2.4.2. Payment may be made (a)
in cash, (b) by cashier's or certified check, (c) by surrender of previously
owned shares of the Common Stock valued pursuant to Paragraph 2.2 (if the
Committee authorizes payment in stock in its discretion), (d) by withholding
from the Option Shares which would otherwise be issuable upon the exercise of
the Stock Option that number of Option Shares equal to the exercise price of the
Stock Option, if such withholding is authorized by the Committee in its
discretion, or (e) in the discretion of the Committee, by the delivery to the
Company of the optionee's promissory note secured by the Option Shares, bearing
interest at a rate sufficient to prevent the imputation of interest under
Sections 483 or 1274 of the Code, and having such other terms and conditions as
may be satisfactory to the Committee.
2.4.2 Exercise of each Stock Option is conditioned upon the agreement of the
Employee to the terms and conditions of this Plan and of such Stock Option as
evidenced by the Employee's execution and delivery of a Notice and Agreement of
Exercise in a form to be determined by the Committee in its discretion. Such
Notice and Agreement of Exercise shall set forth the agreement of the Employee
that (a) no Option Shares will be sold or otherwise distributed in violation of
the Securities Act of 1933, as amended (the "Securities Act") or any other
applicable federal or state securities laws, (b) each Option Share certificate
may be imprinted with legends reflecting any applicable federal and state
securities law restrictions and conditions, (c) the Company may comply with said
securities law restrictions and issue "stop transfer" instructions to its
Transfer Agent and Registrar without liability, (d) if the Employee is a Section
16 Reporting Person, the Employee will furnish to the Company a copy of each
Form 4 or Form 5 filed by said Employee and will timely file all reports
required under federal securities laws, and (e) the Employee will report all
sales of Option Shares to the Company in writing on a form prescribed by the
Company.
2.4.3 No Stock Option shall be exercisable unless and until any applicable
registration or qualification requirements of federal and state securities laws,
and all other legal requirements, have been fully complied with. The Company
will use reasonable efforts to maintain the effectiveness of a Registration
Statement under the Securities Act for the issuance of Stock Options and shares
acquired thereunder, but there may be times when no such Registration Statement
will be currently effective. The exercise of Stock Options may be temporarily
suspended without liability to the Company during times when no such
Registration Statement is currently effective, or during times when, in the
reasonable opinion of the Committee, such suspension is necessary to preclude
violation of any requirements of applicable law or regulatory bodies having
jurisdiction over the Company. If any Stock Option would expire for any reason
except the end of its term during such a suspension, then if exercise of such
Stock Option is duly tendered before its expiration, such Stock Option shall be
exercisable and exercised (unless the attempted exercise is withdrawn) as of the
first day after the end of such suspension. The Company shall have no obligation
to file any Registration Statement covering resales of Option Shares.
2.5 Continuous Employment. Except as provided in Paragraph 2.7 below, an
Employee may not exercise a Stock Option unless from the date of grant to the
date of exercise the Employee remains continuously in the employ of the Company.
For purposes of this Paragraph 2.5, the period of continuous employment of an
Employee with the Company shall be deemed to include (without extending the term
of the Stock Option) any period during which the Employee is on leave of absence
with the consent of the Company, provided that such leave of absence shall not
exceed three months and that the Employee returns to the employ of the Company
at the expiration of such leave of absence. If the Employee fails to return to
the employ of the Company at the expiration of such leave of absence, the
Employee's employment with the Company shall be deemed terminated as of the date
such leave of absence commenced. The continuous employment of an Employee with
the Company shall also be deemed to include any period during which the Employee
is a member of the Armed Forces of the United States, provided that the Employee
returns to the employ of the Company within 90 days (or such longer period as
may be prescribed by law) from the date the Employee first becomes entitled to a
discharge from military service. If an Employee does not return to the employ of
the Company within 90 days (or such longer period as may be prescribed by law)
from the date the Employee first becomes entitled to a discharge from military
service, the Employee's employment with the Company shall be deemed to have
terminated as of the date the Employee's military service ended.
2.6 Restrictions on Transfer. Each Stock Option granted under this Plan shall be
transferable only by will or the laws of descent and distribution. No interest
of any Employee under this Plan shall be subject to attachment, execution,
garnishment, sequestration, the laws of bankruptcy or any other legal or
equitable process. Each Stock Option granted under this Plan shall be
exercisable during an Employee's lifetime only by the Employee or by the
Employee's legal representative.
2.7 Termination of Employment.
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2.7.1 Upon an Employee's Retirement, Disability (both terms being defined below)
or death, (a) all Stock Options to the extent then presently exercisable shall
remain in full force and effect and may be exercised pursuant to the provisions
thereof, including expiration at the end of the fixed term thereof, and (b)
unless otherwise provided by the Committee, all Stock Options to the extent not
then presently exercisable by the Employee shall terminate as of the date of
such termination of employment and shall not be exercisable thereafter.
2.7.2 Upon the termination of the employment of an Employee with the Company for
any reason other than the reasons set forth in Paragraph 2.7.1 hereof, (a) all
Stock Options to the extent then presently exercisable by the Employee shall
remain exercisable only for a period of 90 days after the date of such
termination of employment (except that the 90 day period shall be extended to 12
months if the Employee shall die during such 90 day period), and may be
exercised pursuant to the provisions thereof, including expiration at the end of
the fixed term thereof, and (b) unless otherwise provided by the Committee, all
Stock Options to the extent not then presently exercisable by the Employee shall
terminate as of the date of such termination of employment and shall not be
exercisable thereafter.
2.7.3 For purposes of this Plan:
(a) "Retirement" shall mean an Employee's retirement from the employ of the
Company on or after the date on which the Employee attains the age of 65 years;
and
(b) "Disability" shall mean total and permanent incapacity of
an Employee, due to physical impairment or legally established mental
incompetence, to perform the usual duties of the Employee's employment with the
Company, which disability shall be determined (i) on medical evidence by a
licensed physician designated by the Committee, or (ii) on evidence that the
Employee has become entitled to receive primary benefits as a disabled employee
under the Social Security Act in effect on the date of such disability.
3. Provisions Relating to Awards.
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3.1 Grant of Awards. Subject to the provisions of this Plan, the Committee shall
have full and complete authority, in its discretion, but subject to the express
provisions of this Plan, to (1) grant Awards pursuant to this Plan, (2)
determine the number of shares of the Common Stock subject to each Award (the
"Award Shares"), (3) determine the terms and conditions (which need not be
identical) of each Award, including the consideration (if any) to be paid by the
Employee for such the Common Stock, which may, in the Committee's discretion,
consist of the delivery of the Employee's promissory note meeting the
requirements of Paragraph 2.4.1, (4) establish and modify performance criteria
for Awards, and (5) make all of the determinations necessary or advisable with
respect to Awards under this Plan. Each Award under this Plan shall consist of a
grant of shares of the Common Stock subject to a restriction period (after which
the restrictions shall lapse), which shall be a period commencing on the date
the Award is granted and ending on such date as the Committee shall determine
(the "Restriction Period"). The Committee may provide for the lapse of
restrictions in installments, for acceleration of the lapse of restrictions upon
the satisfaction of such performance or other criteria or upon the occurrence of
such events as the Committee shall determine, and for the early expiration of
the Restriction Period upon an Employee's death, Disability or Retirement as
defined in Paragraph 2.7.3, or, following a Change of Control, upon termination
of an Employee's employment by the Company without "Cause" or by the Employee
for "Good Reason," as those terms are defined herein. For purposes of this Plan:
"Change of Control" shall be deemed to occur (a) on the date the
Company first has actual knowledge that any person (as such term is used in
Sections 13(d) and 14(d)(2) of the Exchange Act) has become the beneficial owner
(as defined in Rule 13(d)-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 40 percent or more of the combined voting
power of the Company's then outstanding securities, or (b) on the date the
stockholders of the Company approve (i) a merger of the Company with or into any
other corporation in which the Company is not the surviving corporation or in
which the Company survives as a subsidiary of another corporation, (ii) a
consolidation of the Company with any other corporation, or (iii) the sale or
disposition of all or substantially all of the Company's assets or a plan of
complete liquidation.
"Cause," when used with reference to termination of the employment of
an Employee by the Company for "Cause," shall mean:
(a) The Employee's continuing willful and material breach of his duties to
the Company after he receives a demand from the Chief Executive of the Company
specifying the manner in which he has willfully and materially breached such
duties, other than any such failure resulting from Disability of the Employee or
his resignation for "Good Reason," as defined herein; or
(b) The conviction of the Employee of a felony; or
(c) The Employee's commission of fraud in the course of his employment with
the Company, such as embezzlement or other material and intentional violation of
law against the Company; or
(d) The Employee's gross misconduct causing material harm to the Company.
"Good Reason" shall mean any one or more of the following, occurring
following or in connection with a Change of Control and within 90 days prior to
the Employee's resignation, unless the Employee shall have consented thereto in
writing
(a) The assignment to the Employee of duties inconsistent with his
executive status prior to the Change of Control or a substantive change in the
officer or officers to whom he reports from the officer or officers to whom he
reported immediately prior to the Change of Control; or
(b) The elimination or reassignment of a majority of the duties and
responsibilities that were assigned to the Employee immediately prior to the
Change of Control; or
(c) A reduction by the Company in the Employee's annual base salary as in
effect immediately prior to the Change of Control; or
(d) The Company requiring the Employee to be based anywhere outside a
35-mile radius from his place of employment immediately prior to the Change of
Control, except for required travel on the Company's business to an extent
substantially consistent with the Employee's business travel obligations
immediately prior to the Change of Control; or
(f) The failure of the Company to grant the Employee a performance bonus
reasonably equivalent to the same percentage of salary the Employee normally
received prior to the Change of Control, given comparable performance by the
Company and the Employee; or
(g) The failure of the Company to obtain a satisfactory Assumption
Agreement (as defined in Paragraph 4.12 of this Plan) from a successor, or the
failure of such successor to perform such Assumption Agreement.
3.2 Incentive Agreements. Each Award granted under this Plan shall be evidenced
by a written agreement (an "Incentive Agreement") in a form approved by the
Committee and executed by the Company and the Employee to whom the Award is
granted. Each Incentive Agreement shall be subject to the terms and conditions
of this Plan and other such terms and conditions as the Committee may specify.
3.3 Waiver of Restrictions. The Committee may modify or amend any Award under
this Plan or waive any restrictions or conditions applicable to the Award;
provided, however, that the Committee may not undertake any such modifications,
amendments or waivers if the effect thereof materially increases the benefits to
any Employee, or adversely affects the rights of any Employee without his
consent.
3.4 Terms and Conditions of Awards. Upon receipt of an Award of shares of the
Common Stock under this Plan, even during the Restriction Period, an Employee
shall be the holder of record of the shares and shall have all the rights of a
stockholder with respect to such shares, subject to the terms and conditions of
this Plan and the Award.
3.4.1 Except as otherwise provided in this Paragraph 3.4, no shares of the
Common Stock received pursuant to this Plan shall be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of during the
Restriction Period applicable to such shares. Any purported disposition of such
the Common Stock in violation of this Paragraph 3.4.2 shall be null and void.
3.4.2 If an Employee's employment with the Company terminates prior to the
expiration of the Restriction Period for an Award, subject to any provisions of
the Award with respect to the Employee's death, Disability or Retirement, or
Change of Control, all shares of the Common Stock subject to the Award shall be
immediately forfeited by the Employee and reacquired by the Company, and the
Employee shall have no further rights with respect to the Award. In the
discretion of the Committee, an Incentive Agreement may provide that, upon the
forfeiture by an Employee of Award Shares, the Company shall repay to the
Employee the consideration (if any) which the Employee paid for the Award Shares
on the grant of the Award. In the discretion of the Committee, an Incentive
Agreement may also provide that such repayment shall include an interest factor
on such consideration from the date of the grant of the Award to the date of
such repayment.
3.4.3 The Committee may require under such terms and conditions as it deems
appropriate or desirable that (a) the certificates for the Common Stock
delivered under this Plan are to be held in custody by the Company or a person
or institution designated by the Company until the Restriction Period expires,
(b) such certificates shall bear a legend referring to the restrictions on the
Common Stock pursuant to this Plan, and (c) the Employee shall have delivered to
the Company a stock power endorsed in blank relating to the Common Stock.
4. Miscellaneous Provisions.
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4.1 Adjustments Upon Change in Capitalization.
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4.1.1 The number and class of shares subject to each outstanding Stock Option,
the Exercise Price thereof (but not the total price), the maximum number of
Stock Options that may be granted under this Plan, the minimum number of shares
as to which a Stock Option may be exercised at any one time, and the number and
class of shares subject to each outstanding Award, shall be proportionately
adjusted in the event of any increase or decrease in the number of the issued
shares of the Common Stock which results from a split-up or consolidation of
shares, payment of a stock dividend or dividends exceeding a total of five
percent for which the record dates occur in any one fiscal year, a
recapitalization (other than the conversion of convertible securities according
to their terms), a combination of shares or other like capital adjustment, so
that (a) upon exercise of the Stock Option, the Employee shall receive the
number and class of shares the Employee would have received had the Employee
been the holder of the number of shares of the Common Stock for which the Stock
Option is being exercised upon the date of such change or increase or decrease
in the number of issued shares of the Company, and (b) upon the lapse of
restrictions of the Award Shares, the Employee shall receive the number and
class of shares the Employee would have received if the restrictions on the
Award Shares had lapsed on the date of such change or increase or decrease in
the number of issued shares of the Company.
4.1.2 Upon a reorganization, merger or consolidation of the Company with one or
more corporations as a result of which United Trading.Com is not the surviving
corporation or in which United Trading.Com survives as a wholly-owned subsidiary
of another corporation, or upon a sale of all or substantially all of the
property of the Company to another corporation, or any dividend or distribution
to stockholders of more than 10 percent of the Company's assets, adequate
adjustment or other provisions shall be made by the Company or other party to
such transaction so that there shall remain and/or be substituted for the Option
Shares and Award Shares provided for herein, the shares, securities or assets
which would have been issuable or payable in respect of or in exchange for such
Option Shares and Award Shares then remaining, as if the Employee had been the
owner of such shares as of the applicable date. Any securities so substituted
shall be subject to similar successive adjustments.
4.2 Withholding Taxes. The Company shall have the right at the time of exercise
of any Stock Option, the grant of an Award, or the lapse of restrictions on
Award Shares, to make adequate provision for any federal, state, local or
foreign taxes which it believes are or may be required by law to be withheld
with respect to such exercise (the "Tax Liability"), to ensure the payment of
any such Tax Liability. The Company may provide for the payment of any Tax
Liability by any of the following means or a combination of such means, as
determined by the Committee in its sole and absolute discretion in the
particular case (1) by requiring the Employee to tender a cash payment to the
Company, (2) by withholding from the Employee's salary, (3) by withholding from
the Option Shares which would otherwise be issuable upon exercise of the Stock
Option, or from the Award Shares on their grant or date of lapse of
restrictions, that number of Option Shares or Award Shares having an aggregate
fair market value (determined in the manner prescribed by Paragraph 2.2) as of
the date the withholding tax obligation arises in an amount which is equal to
the Employee's Tax Liability or (4) by any other method deemed appropriate by
the Committee. Satisfaction of the Tax Liability of a Section 16 Reporting
Person may be made by the method of payment specified in clause (3) above only
if the following two conditions are satisfied:
(a) The withholding of Option Shares or Award Shares and the exercise of
the related Stock Option occur at least six months and one day following the
date of grant of such Stock Option or Award; and
(b) The withholding of Option Shares or Award Shares is made either (i)
pursuant to an irrevocable election (the "Withholding Election") made by the
Employee at least six months in advance of the withholding of Options Shares or
Award Shares, or (ii) on a day within a 10-day "window period" beginning on the
third business day following the date of release of the Company's quarterly or
annual summary statement of sales and earnings.
Anything herein to the contrary notwithstanding, a Withholding Election
may be disapproved by the Committee at any time.
4.3 Relationship to Other Employee Benefit Plans. Stock Options and Awards
granted hereunder shall not be deemed to be salary or other compensation to any
Employee for purposes of any pension, thrift, profit-sharing, stock purchase or
any other employee benefit plan now maintained or hereafter adopted by the
Company.
4.4 Amendments and Termination. The Board of Directors may at any time suspend,
amend or terminate this Plan. No amendment, except as provided in Paragraph 2.8,
or modification of this Plan may be adopted, except subject to stockholder
approval, which would (1) materially increase the benefits accruing to the
Employees under this Plan, (2) materially increase the number of securities
which may be issued under this Plan (except for adjustments pursuant to
Paragraph 4.1 hereof), or (3) materially modify the requirements as to
eligibility for participation in this Plan.
4.5 Successors in Interest. The provisions of this Plan and the actions of the
Committee shall be binding upon all heirs, successors and assigns of the Company
and of the Employees.
4.6 Other Documents. All documents prepared, executed or delivered in connection
with this Plan (including, without limitation, Option Agreements and Incentive
Agreements) shall be, in substance and form, as established and modified by the
Committee; provided, however, that all such documents shall be subject in every
respect to the provisions of this Plan, and in the event of any conflict between
the terms of any such document and this Plan, the provisions of this Plan shall
prevail.
4.7 No Obligation to Continue Employment. This Plan and the grants which might
be made hereunder shall not impose any obligation on the Company to continue to
employ any Employee. Moreover, no provision of this Plan or any document
executed or delivered pursuant to this Plan shall be deemed modified in any way
by any employment contract between an Employee (or other employee) and the
Company.
4.8 Misconduct of an Employee. Notwithstanding any other provision of this Plan,
if an Employee commits fraud or dishonesty toward the Company or wrongfully uses
or discloses any trade secret, confidential data or other information
proprietary to the Company, or intentionally takes any other action materially
inimical to the best interests of the Company, as determined by the Committee,
in its sole and absolute discretion, the Employee shall forfeit all rights and
benefits under this Plan.
4.9 Term of Plan. This Plan was adopted by the Board effective September 20,
2002. No Stock Options or Awards may be granted under this Plan after September
20, 2012.
4.10 Governing Law. This Plan shall be construed in accordance with, and
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governed by, the laws of the State of Nevada.
4.11 Approval. No Stock Option shall be exercisable, or Award granted, unless
and until the Directors of the Company have approved this Plan and all other
legal requirements have been met.
4.12 Assumption Agreements. The Company will require each successor, (direct or
indirect, whether by purchase, merger, consolidation or otherwise), to all or
substantially all of the business or assets of the Company, prior to the
consummation of each such transaction, to assume and agree to perform the terms
and provisions remaining to be performed by the Company under each Incentive
Agreement and Stock Option and to preserve the benefits to the Employees
thereunder. Such assumption and agreement shall be set forth in a written
agreement in form and substance satisfactory to the Committee (an "Assumption
Agreement"), and shall include such adjustments, if any, in the application of
the provisions of the Incentive Agreements and Stock Options and such additional
provisions, if any, as the Committee shall require and approve, in order to
preserve such benefits to the Employees. Without limiting the generality of the
foregoing, the Committee may require an Assumption Agreement to include
satisfactory undertakings by a successor:
(a) To provide liquidity to the Employees at the end of the Restriction
Period applicable to the Common Stock awarded to them under this Plan, or on the
exercise of Stock Options;
(b) If the succession occurs before the expiration of any period specified
in the Incentive Agreements for satisfaction of performance criteria applicable
to the Common Stock awarded thereunder, to refrain from interfering with the
Company's ability to satisfy such performance criteria or to agree to modify
such performance criteria and/or waive any criteria that cannot be satisfied as
a result of the succession;
(c) To require any future successor to enter into an Assumption Agreement;
and
(d) To take or refrain from taking such other actions as the Committee may
require and approve, in its discretion.
The Committee referred to in this Paragraph 4.12 is the Committee
appointed by a Board of Directors in office prior to the succession then under
consideration.
4.13 Compliance with Rule 16b-3. Transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3. To the extent that any
provision of this Plan or action by the Committee fails to so comply, it shall
be deemed null and void, to the extent permitted by law and deemed advisable by
the Committee.
IN WITNESS WHEREOF, this Plan has been executed effective as of
September 20, 2002.
UNITED TRADING.COM
By /s/ James G. Brewer
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James G. Brewer, President