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EXHIBIT 4.1
GEOGRAPHICS, INC. 1999 STOCK OPTION PLAN
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GEOGRAPHICS, INC.
1999 STOCK OPTION PLAN
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GEOGRAPHICS, INC.
1999 STOCK OPTION PLAN
TABLE OF CONTENTS
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ARTICLE 1. ESTABLISHMENT, PURPOSE, AND DURATION..................................................................1
1.1 Establishment of the Plan...........................................................................1
1.2 Purpose of the Plan..................................................................................1
1.3 Duration of the Plan.................................................................................1
ARTICLE 2. DEFINITIONS...........................................................................................1
ARTICLE 3. ADMINISTRATION........................................................................................4
3.1 The Committee........................................................................................4
3.2 Authority of the Committee...........................................................................4
3.3 Decisions Binding....................................................................................4
ARTICLE 4. SHARES SUBJECT TO THE PLAN............................................................................4
4.1 Number of Shares.....................................................................................4
4.2 Lapsed Awards........................................................................................4
4.3 Adjustments in Authorized Shares.....................................................................4
ARTICLE 5. ELIGIBILITY AND PARTICIPATION.........................................................................5
5.1 Eligibility..........................................................................................5
5.2 Actual Participation.................................................................................5
ARTICLE 6. STOCK OPTIONS.........................................................................................5
6.1 Grant of Options.....................................................................................5
6.2 Option Award Agreement...............................................................................5
6.3 Option Price.........................................................................................5
6.4 Duration of Options..................................................................................5
6.5 Exercise of Options..................................................................................5
6.6 Payment..............................................................................................5
6.7 Restrictions on Share Transferability................................................................6
6.8 Termination of Employment Due to Death, Disability or Retirement.....................................6
6.9 Termination of Employment for Other Reasons..........................................................6
6.10 Termination of Services as a Director................................................................7
6.11 Termination of Service as a Consultant...............................................................7
6.12 Transferability of Options...........................................................................7
ARTICLE 7. BENEFICIARY DESIGNATION...............................................................................8
ARTICLE 8. DEFERRALS.............................................................................................8
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ARTICLE 9. RIGHTS OF EMPLOYEES...................................................................................8
9.1 No Right to Employment...............................................................................8
9.2 Participation........................................................................................8
ARTICLE 10. CHANGE IN CONTROL....................................................................................8
ARTICLE 11. AMENDMENT, MODIFICATION, AND TERMINATION.............................................................8
11.1 Amendment, Modification, and Termination.............................................................8
11.2 Awards Previously Granted............................................................................8
ARTICLE 12. WITHHOLDING..........................................................................................8
12.1 Tax Withholding......................................................................................8
12.2 Share Withholding....................................................................................9
ARTICLE 13. SUCCESSORS...........................................................................................9
ARTICLE 14. LEGAL CONSTRUCTION...................................................................................9
14.1 Gender and Number....................................................................................9
14.2 Severability.........................................................................................9
14.3 Requirements of Law..................................................................................9
14.4 Securities Law Compliance............................................................................9
14.5 Governing Law........................................................................................9
14.6 Awards to Foreign Nationals and Employees Outside the United States..................................9
14.7 Unfunded Status of the Plan..........................................................................9
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GEOGRAPHICS, INC.
1999 STOCK OPTION PLAN
ARTICLE 1. ESTABLISHMENT, PURPOSE, AND DURATION
1.1 Establishment of the Plan. Geographics, Inc., a Wyoming
corporation (the "Company"), hereby establishes a stock option plan to be known
as the Geographics, Inc. 1999 Stock Option Plan (the "Plan"), as set forth in
this document. The Plan permits the grant of Nonqualified Stock Options and
Incentive Stock Options.
Upon approval by the Board of Directors of the Company, subject to
ratification by an affirmative vote of a majority of the Shares of the Company,
the Plan shall become effective as of April 16, 1999 (the "Effective Date"), and
shall remain in effect as provided in Section 1.3 herein.
1.2 Purpose of the Plan. The purpose of the Plan is to promote the
success, and enhance the value, of the Company by linking the personal interests
of Participants to those of Company shareholders, and by providing Participants
with an incentive for outstanding performance.
The Plan is further intended to provide flexibility to the Company in
its ability to motivate, attract, and retain the services of Participants upon
whose judgment, interest, and special effort the successful conduct of its
operation is dependent.
1.3 Duration of the Plan. Subject to approval by the Board of
Directors and ratification by the shareholders of the Company, the Plan shall
commence on the Effective Date, as described in Section 1.1 herein, and shall
remain in effect, subject to the right of the Board of Directors to terminate
the Plan at any time pursuant to Article 11 herein, until all Shares subject to
it have been purchased according to the Plan's provisions. However, in no event
may an Award be granted under the Plan more than ten years after the Effective
Date.
ARTICLE 2. DEFINITIONS
Whenever used in the Plan, the following terms shall have the meanings
set forth below and, when the meaning is intended, the initial letter of the
word is capitalized:
(a) "Award" means, individually or collectively, a grant under
this Plan of Nonqualified Stock Options or Incentive Stock
Options.
(b) "Award Agreement" means an agreement entered into by each
Participant and the Company, setting forth the terms and
provisions applicable to Awards granted to Participants
under this Plan.
(c) "Beneficial Owner" shall have the meaning ascribed to such
term in Rule 13d-3 of the General Rules and Regulations
under the Exchange Act.
(d) "Board" or "Board of Directors" means the board of
directors of the Company.
(e) "Cause" means, unless defined otherwise in the
Participant's employment agreement with the Company, (i)
willful and gross misconduct on the part of a Participant
that is materially and demonstrably detrimental to the
Company, (ii) the commission by a Participant of one or
more acts which constitute an indictable crime under
United States Federal, state, or local law, or (iii) the
willful and continued failure of a Participant to
substantially perform his or her duties with or for the
Company or a Subsidiary. "Cause" under either (i), (ii) or
(iii) shall be determined in good faith by the Committee.
(f) "Change in Control" of the Company shall be deemed to have
occurred, unless the Participant's employment agreement or
Award Agreement with the Company's states
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otherwise, as of the first day that any one or more of the
following conditions shall have been satisfied:
(i) The acquisition by a Person of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of 50% of more of either (A) the
then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or
(B) the combined voting power of the then
outstanding voting securities of the Company
entitled to vote generally in the election of
Directors (the "Outstanding Company Voting
Securities"); provided, however, that for purposes
of this subsection (i), the following acquisitions
shall not constitute a Change in Control: (X) any
acquisition by the Company, (Y) any acquisition by
any employee benefit plan (or related trust)
sponsored or maintained by the Company or any
corporation controlled by the Company or (Z) any
acquisition by any corporation pursuant to a
transaction that complies with clauses (A), (B) and
(C) of subsection (iii);
(ii) Individuals who, as of the date hereof, constitute
the Board (the "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 shareholders, was approved by a vote of
at least two-thirds (2/3) 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 an actual or
threatened election contest with respect to the
election or removal of Directors or any other
actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the
Board;
(iii) Consummation of a reorganization, merger or
consolidation or a sale or other disposition of all
or substantially all of the assets of the Company
(a "Business Combination") in each case, unless,
following such Business Combination, (A) 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 Business
Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the
then Outstanding Company Common Stock and the
combined voting power of the then Outstanding
Company Voting Securities after the Business
Combination, (B) no Person (excluding any
corporation resulting from such Business
Combination or any employee benefit plan (or
related trusts) of the Company or such corporation
resulting from such Business Combination)
beneficially owns, directly or indirectly, 40% or
more of either the Outstanding Company Common Stock
or the Outstanding Company Voting Securities except
to the extent that such ownership existed prior to
the Business Combination and (C) at least
two-thirds (2/3) of the members of the Board of
Directors of the corporation resulting from such
Business Combination were members of the Incumbent
Board at the time of the execution of the initial
agreement, or of the action of the Board, providing
for such Business Combination; or
(iv) Approval by the shareholders of the Company of a
complete liquidation or dissolution of the Company.
(g) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
(h) "Committee" means, as applicable, the Board or any
committee, as specified in Article 3, appointed by the
Board to administer the Plan with respect to grants of
Awards.
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(i) "Company" means Geographics, Inc., a corporation, or any
successor thereto as provided in Article 13 herein.
(j) "Consultant" means an individual who performs services for
the Company, but who is not an Employee or a Director.
(k) "Director" means any individual who is not an Employee but
is a member of the Board of Directors.
(l) "Disability" means, unless the Participant's employment
agreement or Award Agreement with the Company states
otherwise, a permanent and total disability, within the
meaning of Code Section 22(e)(3), as determined by the
Company in good faith, upon receipt of sufficient
competent medical advice from one or more individuals,
selected by the Company, who are qualified to give
professional medical advice.
(m) "Employee" means any full-time employee of the Company or
of the Company's Subsidiaries. Directors who are not
otherwise employed full-time by the Company shall not be
considered Employees under this Plan.
(n) "Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time, or any successor thereto.
(o) "Fair Market Value" means the closing price for Shares on
the relevant date, or (if there were no sales on such
date) the average of closing prices on the nearest day
before and the nearest day after the relevant date, on a
stock exchange or over the counter, or as determined by
the Committee.
(p) "Incentive Stock Option" or "ISO" means an option to
purchase Shares, granted under Article 6 herein, which is
designated as an Incentive Stock Option and is intended to
meet the requirements of Section 422 of the Code.
(q) "Insider" shall mean a Participant who is, on the relevant
date, an officer, Director or 10% shareholder of the
Company, subject to Section 16 of the Exchange Act.
(r) "Nonqualified Stock Option" or "NQSO" means an option to
purchase Shares, granted under Article 6 herein, which is
not intended to be an Incentive Stock Option.
(s) "Option" means an Incentive Stock Option or a Nonqualified
Stock Option.
(t) "Option Price" means the price at which a Share may be
purchased by a Participant pursuant to an Option, as
determined by the Committee.
(u) "Participant" means an Employee, a Director or a
Consultant who has outstanding an Award granted under the
Plan.
(v) "Person" shall have the meaning ascribed to such term in
Section 3(a)(9) of the Exchange Act and used in Sections
13(d) and 14(d) thereof, including a "group" as defined in
Section 13(d).
(w) "Retirement" shall mean termination of employment after
attaining age 70.
(x) "Shares" means the shares of common stock of the Company.
(y) "Subsidiary" means any corporation in which the Company
owns directly, or indirectly through subsidiaries, at
least fifty percent (50%) of the total combined voting
power of all classes of stock, or any other entity
(including, but not limited to, partnerships, limited
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liability companies, and joint ventures) in which the
Company owns at least fifty percent (50%) of the combined
equity thereof.
(z) "Window Period" means the period beginning on the third
business day following the date of public release of the
Company's quarterly sales and earnings information, and
ending on the sixtieth day following such date.
ARTICLE 3. ADMINISTRATION
3.1 The Committee. The Plan shall be administered by the Board or a
Committee established by the Board. The members of the Committee, if there be
one, shall be appointed from time to time by, and shall serve at the discretion
of, the Board of Directors.
3.2 Authority of the Committee. The Committee shall have full power
except as limited by law or by the Articles of Incorporation or Bylaws of the
Company, and subject to the provisions herein, to determine the following: the
size and types of Awards with respect to Employees and Consultants; to determine
the terms and conditions of such Employee and Consultant Awards in a manner
consistent with the Plan; to construe and interpret the Plan and any agreement
or instrument entered into under the Plan; to establish, amend, or waive rules
and regulations for the Plan's administration; and (subject to the provisions of
Article 11 herein) to amend the terms and conditions of any outstanding Award to
the extent such terms and conditions are within the discretion of the Committee
as provided in the Plan. Further, the Committee shall make all other
determinations that may be necessary or advisable for the administration of the
Plan. As permitted by law, the Committee may delegate its authority as
identified hereunder.
3.3 Decisions Binding. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan and all determinations,
decisions, related orders or resolutions of the Board pursuant to the provisions
of the Plan shall be final, conclusive, and binding on all persons, including
the Company, its stockholders, Employees, Directors, Consultants, Participants,
and their estates and beneficiaries.
ARTICLE 4. SHARES SUBJECT TO THE PLAN
4.1 Number of Shares. Subject to adjustment as provided in Section
4.3 herein, the total number of Shares available for grant under the Plan may
not exceed 4,500,000. These 4,500,000 Shares may be either authorized but
unissued or reacquired Shares.
The following rules will apply for purposes of the determination of the
number of Shares available for grant under the Plan:
(a) While an Award is outstanding, it shall be counted against
the authorized pool of Shares, regardless of its vested
status.
(b) The grant of an Option shall reduce the Shares available
for grant under the Plan by the number of Shares subject to
such Award.
(c) To the extent that an Award is settled in cash rather than
in Shares, the authorized Share pool shall be credited with
the appropriate number of Shares represented by the cash
settlement of the Award, as determined at the sole
discretion of the Committee (subject to the limitation set
forth in Section 4.2 herein).
4.2 Lapsed Awards. If any Award granted under this Plan is canceled,
terminates, expires, or lapses for any reason any Shares subject to such Award
again shall be available for the grant of an Award under the Plan.
4.3 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation, liquidation, stock
dividend, split-up, Share combination, or other change in the corporate
structure of the Company affecting the Shares, such adjustment shall be made in
the number and class of Shares which may be delivered under the Plan, and in the
number and class of and/or price of Shares subject to
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outstanding Options, granted under the Plan, as may be determined to be
appropriate and equitable by the Committee to prevent dilution or enlargement of
rights; and provided that the number of Shares subject to any Award shall always
be a whole number.
ARTICLE 5. ELIGIBILITY AND PARTICIPATION
5.1 Eligibility. Persons eligible to participate in the Plan include
all Employees, Directors, and
Consultants.
5.2 Actual Participation. Subject to the provisions of the Plan, the
Committee may, from time to time, select from all eligible Employees and
Consultants, those to whom Awards shall be granted and shall determine the
nature and amount of each Award. Subject to the provisions of the Plan, the
Board may from time to time, select from all Directors those to whom Awards
shall be granted and shall determine the nature and amount of such Award.
ARTICLE 6. STOCK OPTIONS
6.1 Grant of Options. Subject to the terms and provisions of the
Plan, Options may be granted to Employees, Directors and Consultants at any time
and from time to time as shall be determined by the Committee. The Committee
shall have discretion in determining the number of Shares subject to Options
granted to each Employee, Directors, and Consultant. The Committee may grant
ISOs, NQSOs, or a combination thereof to Employees.
6.2 Option Award Agreement. Each Option grant shall be evidenced by
an Award Agreement that shall specify the Option Price, the duration of the
Option, the number of Shares to which the Option pertains, and such other
provisions as the Committee shall determine. The Award Agreement also shall
specify whether the Option is intended to be an ISO within the meaning of
Section 422 of the Code, or a NQSO whose grant is intended not to fall under the
Code provisions of Section 422.
6.3 Option Price. The Option Price for each grant of an option to an
Employee, Director, or Consultant shall be determined by the Committee.
6.4 Duration of Options. Each Option granted shall expire at such
time as the Committee shall determine at the time of grant; provided, however,
that no ISO or NQSO shall be exercisable later than the tenth (10th) anniversary
date of its grant.
6.5 Exercise of Options. Options granted under the Plan shall be
exercisable at such times and be subject to such restrictions and conditions as
the Committee shall in each instance approve, which need not be the same for
each grant or for each Participant.
6.6 Payment. Options shall be exercised by the delivery of a written
notice of exercise to the Secretary of the Company, setting forth the number of
Shares with respect to which the Option is to be exercised, accompanied by full
payment for the Shares and any withholding tax relating to the Option.
The Option Price, and any related withholding taxes, upon exercise of
any Option shall be payable to the Company in full either (a) in cash or its
equivalent, or (b) at the discretion of the Committee at the time of such
exercise, by tendering previously acquired Shares having an aggregate Fair
Market Value at the time of exercise equal to the total Option Price or (c) by a
combination of (a) and (b).
The Committee (or the Board in the case of a Director) also may allow
cashless exercise as permitted under Federal Reserve Board's Regulation T,
subject to applicable securities law restrictions, or by any other means which
the Committee determines to be consistent with the Plan's purpose and applicable
law.
As soon as practicable after receipt of a written notification of
exercise and full payment, the Company shall deliver to the Participant, in the
Participant's name, Share certificates in an appropriate amount based upon the
number of Shares purchased under the Option(s).
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6.7 Restrictions on Share Transferability. The Committee may impose
such restrictions on any Shares acquired pursuant to the exercise of an Option
under the Plan, as it may deem advisable, including, without limitation,
restrictions under applicable Federal securities laws, under the requirements of
any stock exchange or market upon which such Shares are then listed and/or
traded, and under any Blue Sky or state securities laws applicable to such
Shares.
6.8 Termination of Employment Due to Death, Disability or Retirement.
Unless a Participant's employment agreement or Award Agreement with the Company
states otherwise, the following shall apply to each Participant:
(a) Termination by Death. In the event the employment of an
Employee is terminated by reason of death, all outstanding
Options granted to that Employee that are not vested shall
immediately be forfeited to the Company. However, the
vested Options shall remain exercisable at any time prior
to their expiration date, or for one (1) year after the
date of death, whichever period is shorter, by such person
or persons as shall have been named as the Employee's
beneficiary, or by such persons that have acquired the
Employee's rights under the Option by will or by the laws
of descent and distribution.
(b) Termination by Disability. In the event the employment of
an Employee is terminated by reason of Disability, all
outstanding Options granted to that Employee that are not
vested shall immediately be forfeited to the Company as of
the date the Committee determines the definition of
Disability to have been satisfied. However, the vested
Options shall remain exercisable at any time prior to
their expiration date, or for one (1) year after the date
that the Committee determines the definition of Disability
to have been satisfied, whichever period is shorter.
(c) Termination by Retirement. In the event the employment of
an Employee is terminated by reason of Retirement, all
outstanding Options granted to such Employee that are not
vested shall immediately be forfeited. However, the vested
Options shall remain exercisable at any time prior to
their expiration date, or for one (1) year after the
Retirement of Employee, whichever period is shorter.
(d) Employment Termination Followed by Death. In the event
that an Employee's employment terminates by reason of
Disability or Retirement, and within the exercise period
allowed by the Committee following such termination the
Employee dies, then the remaining exercise period under
outstanding Options shall equal the longer of the
following: (i) one (1) year following death; or (ii) the
remaining portion of the exercise period which was
triggered by the employment termination. Such Options
shall be exercisable by such person or persons who shall
have been named as the Employee's beneficiary, or by such
persons who have acquired the Employee's rights under the
Option by will or by the laws of descent and distribution.
(e) Exercise Limitations on ISOs. In the case of ISOs, the tax
treatment prescribed under Section 422 of the Code, may
not be available if the Options are not exercised within
the Section 422 prescribed time periods after each of the
various types of employment termination.
6.9 Termination of Employment for Other Reasons. Except as otherwise
provided in a Participant's employment agreement or Award Agreement with the
Company, if the employment of an Employee shall terminate for any reason other
than the reasons set forth in Section 6.8 (and other than for Cause), all
Options held by the Employee that are not vested as of the effective date of
employment termination immediately shall be forfeited to the Company (and shall
once again become available for grant under the Plan). However, the Committee,
in its sole discretion, shall have the right to immediately vest all or any
portion of such Options, subject to such terms as the Committee, in its sole
discretion, deems appropriate.
Options that are vested as of the effective date of employment
termination may be exercised by the
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Employee within the period beginning on the effective date of employment
termination, and ending ninety (90) days after such date or on such later date
as is approved by the Committee.
If the employment of an Employee shall be terminated by the Company for
Cause, all outstanding Options held by the Participant immediately shall be
forfeited to the Company and no additional exercise period shall be allowed,
regardless of the vested status of the Options.
6.10 Termination of Services as a Director. Except as provided in a
Director's Award Agreement, if a Director's tenure ends because of death,
Disability or following a Change in Control, such Director's Options that are
not vested shall be immediately forfeited to the Company. Following the date on
which the Director ceases to serve as a Director, other than as a result of
removal for Cause, all vested outstanding Options shall remain exercisable, to
the extent such Options may be exercised pursuant to this Plan, until the
earlier of the following: (i) one year from the date the Director ceases to
serve in such capacity; or (ii) the expiration of the original Option term. If a
Director is removed for Cause, all outstanding Options held by the Director
shall be immediately forfeited to the Company and no additional exercise period
shall be allowed regardless of the vested status of the Options.
6.11 Termination of Services as a Consultant. Except as provided in a
Consultant's Award Agreement, if a Consultant's tenure ends because of death or
Disability or following a Change in Control, such Consultant's Options shall be
immediately forfeited to the Company. Following the date on which the Consultant
ceases to serve as a Consultant, other than termination for Cause, all vested
outstanding Options shall remain exercisable, to the extent such Options may be
exercised pursuant to this Plan, until the earlier of the following: (i) six
months from the date the Consultant ceases to serve in such capacity; or (ii)
the expiration of the original Option term. If a Consultant is terminated for
Cause, all outstanding Options shall be immediately forfeited to the Company and
no additional exercise period shall be allowed regardless of the vested status
of the Options.
6.12 Transferability of Options. No ISO granted under the Plan may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution. Further, all ISOs
granted to a Participant under the Plan shall be exercisable during his or her
lifetime only by such Participant.
NQSOs granted hereunder may be exercised only during a Participant's
lifetime by the Participant, the Participant's guardian or legal representative
or by a permissible transferee. NQSOs shall be transferable by Participants
pursuant to the laws of descent and distribution upon a Participant's death, and
during a Participant's lifetime. NQSOs shall be transferable by Participants
only to members of their immediate family, trusts for the benefit of members of
their immediate family, and charitable institutions ("permissible transferees")
to the extent permitted under Section 16 of the Exchange Act and subject to
federal and state securities laws. The term "immediate family" shall mean any
child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling,
mother-in-law, father-in-law, son-in-law, daughter-in-law, sister-in-law, or
brother-in-law and shall include adoptive relationships.
NQSOs also shall be transferable by Participants other than to
permissible transferees with the prior approval of the Committee which shall
have the authority to approve such transfers of NQSOs on a case-by-case basis in
its sole discretion.
The Committee shall have the authority to establish rules and
regulations specifically governing the transfer of NQSOs granted under this Plan
as it deems necessary and advisable.
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ARTICLE 7. BENEFICIARY DESIGNATION
Each Participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of his or her death before
he or she receives any or all of such benefit. Each such designation shall
revoke all prior designations by the same Participant, shall be in a form
prescribed by the Company, and will be effective only when any necessary spousal
consent is obtained and filed by the Participant in writing with the Secretary
of the Company during the Participant's lifetime. In the absence of any such
designation, benefits remaining unpaid at the Participant's death shall be paid
to the Participant's estate.
ARTICLE 8. DEFERRALS
The Committee may permit a Participant to defer such Participant's
receipt of the payment of cash or the delivery of Shares that would otherwise be
due to such Participant by virtue of the exercise of an Option and applicable
withholding taxes related thereto. If any such deferral election is required or
permitted, the Committee shall, in its sole discretion, establish rules and
procedures for such payment deferrals.
ARTICLE 9. RIGHTS OF EMPLOYEES
9.1 No Right to Employment. Nothing in the Plan shall interfere with
or limit in any way the right of the Company to terminate any Employee's
employment at any time, nor confer upon any Employee any right to continue in
the employ of the Company.
For purposes of the Plan, transfer of employment of a Participant
between the Company and any one of its Subsidiaries (or between Subsidiaries)
shall not be deemed a termination of employment.
9.2 Participation. No Employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected to
receive a future Award.
ARTICLE 10. CHANGE IN CONTROL
Except as provided in a Participant's employment agreement or Award
Agreement with the Company, upon the occurrence of a Change in Control, unless
otherwise specifically prohibited by the terms of the Plan, the following shall
apply:
(a) Any and all Options granted hereunder that are not vested
shall be immediately forfeited; and
(b) Subject to Article 11 herein, the Committee shall have the
authority to make any modifications to the Awards as
determined by the Committee to be appropriate before the
effective date of the Change in Control.
ARTICLE 11. AMENDMENT, MODIFICATION, AND TERMINATION
11.1 Amendment, Modification, and Termination. The Board, at any time
and from time to time, may terminate, amend, or modify the Plan.
11.2 Awards Previously Granted. No termination, amendment, or
modification of the Plan shall adversely affect in any material way any Award
previously granted under the Plan, without the written consent of the
Participant holding such Award.
ARTICLE 12. WITHHOLDING
12.1 Tax Withholding. The Company shall have the power and the right
to deduct or withhold, or require a Participant to remit to the Company, an
amount sufficient to satisfy Federal, state, and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any taxable event
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arising or as a result of this Plan.
12.2 Share Withholding. With respect to withholding required upon the
exercise of Options or upon any other taxable event hereunder, Participants may
elect, subject to the approval of the Committee, to satisfy the withholding
requirement, in whole or in part, by having the Company withhold Shares having a
Fair Market Value on the date the tax is to be determined equal to the minimum
statutory total tax which could be imposed on the transaction. All elections
shall be irrevocable, made in writing, signed by the Participant.
ARTICLE 13. SUCCESSORS
All obligations of the Company under the Plan, with respect to Awards
granted hereunder, shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.
ARTICLE 14. LEGAL CONSTRUCTION
14.1 Gender and Number. Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine; the
plural shall include the singular and the singular shall include the plural.
14.2 Severability. In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be construed and
enforced in a manner so as to give the maximum valid and enforceable effect to
such provisions.
14.3 Requirements of Law. The granting of Awards and the issuance of
Shares under the Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.
14.4 Securities Law Compliance. With respect to Insiders, transactions
under this Plan are intended to comply with all applicable conditions or Rule
16b-3 or its successors under the 1934 Act. To the extent any provision of the
plan or action by the Board or 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.
14.5 Governing Law. To the extent not preempted by Federal law,
the Plan, and all agreements hereunder, shall be construed in accordance with
and governed by the laws of the State of Washington.
14.6 Awards to Foreign Nationals and Employees Outside the United
States. To the extent the Committee deems it necessary, appropriate or desirable
to comply with foreign law or practice and to further the purposes of this Plan,
the Committee may, without amending the Plan, (i) establish rules applicable to
Awards granted to Participants who are foreign nationals, are employed outside
the United States, or both, including rules that differ from those set forth in
this Plan, and (ii) grant Awards to such Participates in accordance with those
rules.
14.7 Unfunded Status of the Plan. The Plan is intended to constitute
an "unfunded" plan for incentive and deferred compensation. With respect to any
payments or deliveries of Shares not yet made to a Participate by the Company,
nothing contained herein shall give any rights that are greater than those of a
general creditor of the Company. The Committee may authorize the creation of
trusts or other arrangements to meet the obligations created under the Plan to
deliver Shares or payments hereunder consistent with the foregoing.
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