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Exhibit 99.1
The benefits, policies, practices, and procedures described herein are those
approved by TrueChat Inc. ("TrueChat").
No description of benefits, policies, practices, and procedures contained in
this Incentive Plan or communicated by a management representative constitutes a
contract that establishes terms and conditions of employment other than a
contract of employment at will. TrueChat retains the right to change, modify,
suspend, interpret, or eliminate any provision in this Incentive Plan,
retroactively or prospectively, at any time in accordance with applicable law.
THE TRUECHAT 2000 EQUITY INCENTIVE PLAN
1. DEFINED TERMS
Exhibit A, which is incorporated by reference, defines the terms used in
the Plan and sets forth certain operational rules related to those terms.
2. GENERAL
The Plan has been established to advance the interests of the Company by
giving selected Employees, directors and other persons (including both
individuals and entities) who provide services to the Company or its Affiliates
Stock-based incentives or incentives based on other performance measures
relating to the Company or its Affiliates.
3. ADMINISTRATION
The Administrator has discretionary authority, subject only to the express
provisions of the Plan, to interpret the Plan; determine eligibility for and
grant Awards; determine, modify or waive the terms and conditions of any Award;
prescribe forms, rules and procedures (which it may modify or waive): and
otherwise do all things necessary to carry out the purposes of the Plan. Once an
Award has been communicated in writing to a Participant, the Administrator may
not, without the Participant's consent, alter the terms of the Award so as to
affect adversely the Participant's rights under the Award, unless the
Administrator expressly reserved the right to do so in writing at the time of
such communication.
4. SHARES SUBJECT TO THE PLAN
a. A maximum of 4,320,000 shares of Stock may be delivered in
satisfaction of Awards under the Plan. For purposes of the preceding sentence,
the following shares shall not be considered to have been delivered under the
Plan: (i) shares remaining under an Award that terminates
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without having been exercised in full; (ii) shares subject to an Award, where
cash is delivered to a Participant in lieu of such shares; (iii) shares of
Restricted Stock that have been forfeited in accordance with the terms of the
applicable Award; and (iv) shares held back, in satisfaction of the exercise
price or tax withholding requirements, from shares that would otherwise have
been delivered pursuant to an Award. The number of shares of Stock delivered
under an Award shall be determined net of any previously acquired Shares
tendered by the Participant in payment of the exercise price, if any, or of
withholding taxes.
b. Stock delivered by the Company under the Plan may be authorized but
unissued Stock or previously issued Stock acquired by the Company and held in
treasury. No fractional shares of Stock will be delivered under the Plan.
5. ELIGIBILITY AND PARTICIPATION
The Administrator will select Participants from among those key Employees,
directors and other individuals or entities providing services to the Company or
its Affiliates who, in the opinion of the Administrator, are in a position to
make a significant contribution to the success of the Company and its
Affiliates. Eligibility for ISOs is further limited to those individuals whose
employment status would qualify them for the tax treatment described in Sections
421 and 422 of the Code.
6. RULES APPLICABLE TO AWARDS
a. ALL AWARDS
(1) Performance Objectives. Where rights under an Award depend in
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whole or in part on attainment of performance objectives, actions by the Company
that have an effect, however material, on such performance objectives or on the
likelihood that they will be achieved will not be deemed an amendment or
alteration of the Award unless accomplished by a change in the express terms of
the Award or other action that is without substantial consequence except as it
affects the Award.
(2) Alternative Settlement. The Company retains the right at any
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time to extinguish rights under an Award in exchange for payment in cash, Stock
(subject to the limitations of Section 4) or other property on such terms as the
Administrator determines, provided the holder of the Award consents to such
exchange.
(3) Transferability of Awards. Except as the Administrator otherwise
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expressly provides, Awards (other than an Award in the form of an outright
transfer of cash or Unrestricted Stock) may not be transferred other than by
will or by the laws of descent and distribution, and
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during a Participant's lifetime an Award requiring exercise may be exercised
only by the Participant (or in the event of the Participant's incapacity, the
person or persons legally appointed to act on the Participant's behalf).
(4) Vesting, etc. Without limiting the generality of Section 3 and
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subject to subsections (a) and (b) below, the Administrator may determine the
time or times at which an Award will vest (i.e., become free of forfeiture
restrictions) or become exercisable and the terms on which an Award requiring
exercise will remain exercisable.
(a) Death. Except as the Administrator may otherwise determine, if a
Participant dies, the following will apply:
(i) All Awards requiring exercise held by the Participant
immediately prior to death, to the extent then exercisable, may be exercised by
the Participant's executor or administrator or the person or persons to whom the
Award is transferred by will or the applicable laws of descent and distribution,
at any time within the one-year period ending with the first anniversary of the
Participant's death (or such shorter or longer period as the Administrator may
determine), and shall thereupon terminate. In no event, however, shall an Award
requiring exercise remain exercisable beyond the latest date on which it could
have been exercised without regard to this Section 6.a.(4)(a). Except as
otherwise determined by the Administrator, all Awards requiring exercise held by
a Participant immediately prior to death that are not then exercisable shall
terminate at death.
(ii) All Restricted Stock held by the Participant must be
transferred to the Company together with duly executed stock powers (and, in the
event the certificates representing such Restricted Stock are held by the
Company, such Restricted Stock will be so transferred without any further action
by the Participant, provided that the Participant deliver a duly executed stock
power at such time).
(iii) Any payment or benefit under a Performance Award to which
the Participant was not irrevocably entitled prior to death will be forfeited
and the Award canceled as of the time of death, except as otherwise determined
by the Administrator.
(b) Termination of Service (Other than by Death).
If a Participant who is an Employee ceases to be an Employee for any reason
other than death or retirement with consent of the Company after attainment of
age 65, or if there is a termination (other than by reason of death or
satisfactory completion of the project or service determined by the
Administrator) of the consulting, service or similar relationship in respect of
which a non-Employee Participant was granted an Award hereunder (such
termination of employment or other relationship being hereinafter referred to
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as a "Status Change"), then, except as the Administrator may otherwise
determine, the following will apply:
(i) All Awards requiring exercise held by the Participant that
were not exercisable immediately prior to the Status Change shall terminate at
the time of the Status Change. Any Awards requiring exercise that were
exercisable immediately prior to the Status Change will continue to be
exercisable for a period of three months (or such longer period as the
Administrator may determine), and shall thereupon terminate, unless the Award
provides by its terms for immediate termination in the event of a Status Change
(unless otherwise determined by the Administrator) or unless the Status Change
results from a discharge for cause which in the opinion of the Administrator
casts such discredit on the Participant as to justify immediate termination of
the Award. In no event, however, shall an Award requiring exercise remain
exercisable beyond the latest date on which it could have been exercised without
regard to this Section 6.a.(4)(b). For purposes of this paragraph, in the case
of a Participant who is an Employee, a Status Change shall not be deemed to have
resulted by reason of (i) a sick leave or other bona fide leave of absence
approved for purposes of the Plan by the Administrator, so long as the Employee
Participant's right to reemployment is guaranteed either by statute or by
contract, or (ii) a transfer of employment between the Company and a subsidiary
or between subsidiaries, or to the employment of a corporation (or a parent or
subsidiary corporation of such corporation) issuing or assuming an option in a
transaction to which Section 424(a) of the Code applies.
(ii) Except as otherwise determined by the Administrator, all
Restricted Stock held by the Participant at the time of the Status Change must
be transferred to the Company (and, in the event the certificates representing
such Restricted Stock are held by the Company, such Restricted Stock will be so
transferred without any further action by the Participant).
(iii) Any payment or benefit under a Performance Award to which
the Participant was not irrevocably entitled prior to the Status Change will be
forfeited and the Award canceled as of the date of such Status Change unless
otherwise determined by the Administrator.
(5) Taxes. The Administrator will make such provision for the
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withholding of taxes as it deems necessary. The Administrator may, but need not,
hold back shares of Stock from an Award or permit a Participant to tender
previously owned shares of Stock in satisfaction of tax-withholding
requirements.
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(6) Dividend Equivalents, etc. The Administrator may provide
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for the payment of amounts in lieu of cash dividends or other cash distributions
with respect to Stock subject to an Award.
(7) Rights Limited. Nothing in the Plan shall be construed as
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giving any person the right to continued employment or service with the Company
or its Affiliates, or any rights as a shareholder except as to shares of Stock
actually issued under the Plan. The loss of existing or potential profit in
Awards will not constitute an element of damages in the event of termination of
employment or service for any reason, even if the termination is in violation of
an obligation of the Company or Affiliate to the Participant.
b. AWARDS REQUIRING EXERCISE
(1) Time and Manner of Exercise. Unless the Administrator
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expressly provides otherwise, (a) an Award requiring exercise by the holder will
not be deemed to have been exercised until the Administrator receives a written
notice of exercise (in form acceptable to the Administrator) signed by the
appropriate person and accompanied by any payment required under the Award; and
(b) if the Award is exercised by any person other than the Participant, the
Administrator may require satisfactory evidence that the person exercising the
Award has the right to do so.
(2) Payment of Exercise Price, if Any. Where the exercise of an
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Award is to be accompanied by payment, the Administrator may determine the
required or permitted forms of payment either at or after the time of the Award,
subject to the following: (a) unless the Administrator expressly provides
otherwise, all payments will be by cash or check acceptable to the
Administrator, and (b) where shares of Stock issued under an Award are part of
an original issue of shares, the Award shall require an exercise price equal to
at least the par value of such shares.
(3) Reload Awards. The Administrator may provide that upon the
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exercise of an Award, either by payment of cash or (if permitted under Section
6.b.(2) above) through the tender of previously owned shares of Stock, the
Participant or other person exercising the Award will automatically receive a
new Award of like kind covering a number of shares of Stock equal to the number
of shares of Stock for which the first Award was exercised.
(4) ISOs. No ISO may be granted under the Plan after April 18,
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2010, but ISOs previously granted may extend beyond that date.
c. AWARDS NOT REQUIRING EXERCISE
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Awards of Restricted Stock and Unrestricted Stock may be made in return
for either services determined by the Administrator to have a value not less
than the par value of the awarded shares of Stock, or (ii) cash or other
property having a value not less than the par value of the awarded shares of
Stock plus such additional amounts (if any) as the Administrator may determine
payable in such combination and type of cash, other property (of any kind) or
services as the Administrator may determine.
7. EFFECT OF CERTAIN TRANSACTIONS
a. MERGERS. ETC.
In the event of (i) a consolidation or merger in which the Company is not
the surviving corporation or which results in the acquisition of all or
substantially all of the Company's then outstanding common stock by a single
person or entity or by a group of persons and/or entities acting in concert,
(ii) a sale or transfer of all or substantially all the Company's assets, or
(iii) a dissolution or liquidation of the Company (any of the foregoing, a
"covered transaction"), all outstanding Awards (other than shares of Stock that
are outstanding and fully vested) will be forfeited as of the effective time of
the covered transaction unless assumed by an acquiring or surviving entity or
its affiliate as provided in the following sentence. In connection with any
covered transaction in which there is an acquiring or surviving entity, the
Administrator may provide for substitute or replacement awards from, or the
assumption of Awards by, the acquiring or surviving entity or its affiliates,
any such substitution, replacement or assumption to be on such terms as the
Administrator determines; but if there is no acquiring or surviving entity, or
if the Administrator does not so provide for the substitution, replacement or
assumption of Awards in connection with the covered transaction, all outstanding
Awards shall vest and if relevant become exercisable and all deferrals, other
than deferrals of amounts that are neither measured by reference to nor payable
in shares of Stock, shall be accelerated, immediately prior to the covered
transaction.
b. CHANGES IN AND DISTRIBUTIONS WITH RESPECT TO THE STOCK
(1) Basic Adjustment Provisions. In the event of a stock dividend,
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stock split or combination of shares, recapitalization or other change in the
Company's capital structure, the Administrator will make appropriate adjustments
to the maximum number of shares that may be delivered under the Plan under
Section 4 and will also make appropriate adjustments to the number and kind of
shares of stock or securities subject to Awards then outstanding or subsequently
granted, any exercise prices relating to Awards and any other provision of
Awards affected by such change.
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(2) Certain Other Adjustments. The Administrator may also
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make adjustments of the type described in paragraph (1) above to take into
account distributions to common stockholders other than stock dividends or
normal cash dividends, mergers, consolidations, acquisitions, dispositions or
similar corporate transactions, or any other event, if the Administrator
determines that adjustments are appropriate to avoid distortion in the operation
of the Plan and to preserve the value of Awards made hereunder; provided, that
no such adjustment shall be made to ISOs except to the extent consistent with
their continued qualification under Section 422 of the Code.
(3) Continuing Application of Plan Terms. References in the
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Plan to shares of Stock shall be construed to include any stock or securities
resulting from an adjustment pursuant to Section 7.b.(1) or 7.b.(2) above.
8. CONDITIONS ON DELIVERY OF STOCK
Company will not be obligated to deliver any shares of Stock pursuant to
the Plan or to remove any restriction from shares of Stock previously delivered
under the Plan until the Company's counsel has approved all legal matters in
connection with the issuance and delivery of such shares; if the outstanding
Stock is at the time of delivery listed on any stock exchange or national market
system, the shares to be delivered have been listed or authorized to be listed
on such exchange or system upon official notice of issuance; and all conditions
of the Award have been satisfied or waived. If the sale of Stock has not been
registered under the Securities Act of 1933, as amended, the Company may
require, as a condition to exercise of the Award, such representations or
agreements as counsel for the Company may consider appropriate to avoid
violation of such Act. The Company may require that certificates evidencing
Stock issued under the Plan bear an appropriate legend reflecting any
restriction on transfer applicable to such Stock.
9. AMENDMENT AND TERMINATION
Subject to the last sentence of Section 3, the Administrator may at any
time or times amend the Plan or any outstanding Award for any purpose which may
at the time be permitted by law, or may at any time terminate the Plan as to any
further grants of Awards; provided, that (except to the extent expressly
required or permitted by the Plan) no such amendment will, without the approval
of the stockholders of the Company, effectuate a change for which stockholder
approval is required in order for the Plan to continue to qualify under Section
422 of the Code.
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10. NON-LIMITATION OF THE COMPANY'S RIGHTS
The existence of the Plan or the grant of any Award shall not in any way
affect the Company's right to award a person bonuses or other compensation in
addition to Awards under the Plan.
11. GOVERNING LAW
The Plan shall be construed in accordance with the laws of the State of
Colorado.
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EXHIBIT A
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Definition of Terms
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The following terms, when used in the Plan, shall have the meanings and
be subject to the provisions set forth below:
"Administrator": The Board or, if one has been appointed, the
Committee.
"Affiliate": Any corporation or other entity owning, directly or
indirectly, 50% or more of the outstanding Stock of the Company, or in which the
Company or any such corporation or other entity owns, directly or indirectly,
50% of the outstanding capital stock (determined by aggregate voting rights) or
other voting interests.
"Award": Any of the following:
(i) Options ("Stock Options") entitling the recipient to
acquire shares of Stock upon payment of the exercise price. Each Stock Option
(except as otherwise expressly provided by the Administrator) will have an
exercise price equal to the fair market value of the Stock subject to the
option, determined as of the date of grant, except that an ISO granted to an
Employee described in Section 422(b)(6) of the Code will have an exercise price
equal to 110% of such fair market value. The Administrator will determine the
medium in which the exercise price is to be paid, the duration of the option,
the time or times at which an option will become exercisable, provisions for
continuation (if any) of option rights following termination of the
Participant's employment with the Company and its Affiliates, and all other
terms of the Stock Option. No Stock Option awarded under the Plan will be an ISO
unless the Administrator expressly provides for ISO treatment.
(ii) Rights ("SARs") entitling the holder upon exercise to
receive cash or Stock, as the Administrator determines, equal to a function
(determined by the Administrator upon such factors as it deems appropriate) of
the amount by which the Stock has appreciated in value since the date of the
Award.
(iii) Stock subject to restrictions ("Restricted Stock") under
the Plan requiring that such Stock be redelivered to the Company if specified
conditions are not satisfied. The conditions to be satisfied in connection with
any Award of Restricted Stock, the terms on which such Stock must be redelivered
to the Company, the purchase price of such Stock, and all other terms shall be
determined by the Administrator.
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(iv) Stock not subject to any restrictions under the Plan
("Unrestricted Stock")
(v) A promise to deliver Stock or other securities in the
future on such terms and conditions as the Administrator determines.
(vi) Securities (other than Stock Options) that are convertible
into or exchangeable for Stock on such terms and conditions as the Administrator
determines.
(vii) Cash bonuses tied to performance criteria as described at
(viii) below ("Cash Performance Awards").
(viii) Awards described in any of (i) through (vii) above where
the right to exercisability, vesting or full enjoyment of the Award is
conditioned in whole or in part on the satisfaction of specified performance
criteria ("Performance Awards") .
(ix) Grants of cash, or loans, made in connection with other
Awards in order to help defray in whole or in part the economic cost (including
tax cost) of the Award to the Participant. The terms of any such grant or loan
shall be determined by the Administrator.
Awards may be combined in the Administrator's discretion.
"Board": The Board of Directors of the Company.
"Code": The U.S. Internal Revenue Code of 1986 as from time to time
amended and in effect, or any successor statute as from time to time in effect.
"Committee": A committee of the Board comprising solely two or more
outside directors within the meaning of Section 162(m) of the Code. The
Committee may delegate ministerial tasks to such persons (including Employees)
as it deems appropriate.
"Company" or "Corporation": Means TrueChat, Inc.
"Employee": Any person who is employed by the Company or an Affiliate.
"ISO": A Stock Option intended to be an "incentive stock option" within
the meaning of Section 422 of the Code.
"Participant": An Employee, director or other person providing services
to the Company or its Affiliates who is granted an Award under the Plan.
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"Plan": The Corporation 2000 Equity Incentive Plan as from time to time
amended and in effect.
"Stock": Common Stock of the Company, par value $.01 per share.
