AMENDED AND RESTATED
THE MAJESTIC COMPANIES, LTD.
RETAINER STOCK PLAN FOR
NON-EMPLOYEE DIRECTORS AND CONSULTANTS
1. Introduction.
This plan shall be known as Amended and Restated The Majestic Companies
Retainer Stock Plan For Non-Employee Directors and Consultants is hereinafter
referred to as the "Plan". The purposes of the Plan are to enable The Majestic
Companies, Ltd., a Nevada corporation ("Company"), to promote the interests of
the Company and its shareholders by attracting and retaining non-employee
Directors and Consultants capable of furthering the future success of the
Company and by aligning their economic interests more closely with those of the
Company's shareholders, by paying their retainer or fees in the form of shares
of the Company's common stock, par value one tenth of one cent ($0.001) per
share ("Common Stock").
2. Definitions.
The following terms shall have the meanings set forth below:
"Board" means the Board of Directors of the Company.
"Change of Control" has the meaning set forth in Section 12(d).
"Code" means the Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder. References to any provision of the Code or rule or
regulation thereunder shall be deemed to include any amended or successor
provision, rule or regulation.
"Committee" means the committee that administers the Plan, as more fully
defined in Section 13.
"Common Stock" has the meaning set forth in Section 1.
"Company" has the meaning set forth in Section 1.
"Deferral Election" has the meaning set forth in Section 6.
"Deferred Stock Account" means a bookkeeping account maintained by the Company
for a Participant representing the Participant's interest in the shares
credited to such Deferred Stock Account pursuant to Section 7.
"Delivery Date" has the meaning set forth in Section 6.
"Director" means an individual who is a member of the Board of Directors of the
Company.
"Dividend Equivalent" for a given dividend or other distribution means a number
of shares of Common Stock having a Fair Market Value, as of the record date for
such dividend or distribution, equal to the amount of cash, plus the fair market
value on the date of distribution of any property, that is distributed with
respect to one share of Common Stock pursuant to such dividend or
distribution; such fair market value to be determined by the Committee in good
faith.
"Effective Date" has the meaning set forth in Section 3.
"Exchange Act" has the meaning set forth in Section 13(b).
"Fair Market Value" means the mean between the highest and lowest reported
sales prices of the Common Stock on the NYSE Composite Tape or, if not listed
on such exchange, on any other national securities exchange on which the Common
Stock is listed or on NASDAQ on the last trading day prior to the date with
respect to which the Fair Market Value is to be determined.
"Participant" has the meaning set forth in Section 4.
"Payment Time" means the time when a Stock Retainer is payable to a
Participant pursuant to Section 5 (without regard to the effect of any Deferral
Election).
"Stock Retainer" has the meaning set forth in Section 5.
"Third Anniversary" has the meaning set forth in Section 6.
3. Effective Date of the Plan.
The Plan was adopted by the Board effective June 26, 2000 ("Effective Date").
4. Eligibility.
Each individual who is a Director or Consultant on the Effective Date and each
individual who becomes a Director or Consultant thereafter during the term of
the Plan, shall be a participant ("Participant") in the Plan, in each case
during such period as such individual remains a Director or Consultant and is
not an employee of the Company or any of its subsidiaries. Each credit of
shares of Common Stock pursuant to the Plan shall be evidenced by a written
agreement duly executed and delivered by or on behalf of the Company and a
Participant, if such an agreement is required by the Company to assure
compliance with all applicable laws and regulations.
5. Grants of Shares.
Commencing on the Effective Date, the amount for service to directors or
consultants shall instead be payable in shares of Common Stock ("Stock
Retainer") pursuant to this Plan at the deemed issuance price of one tenth of
one cent ($0.001) per Share.
6. Deferral Option.
From and after the Effective Date, a Participant may make an election (a
"Deferral Election") on an annual basis to defer delivery of the Stock Retainer
specifying which one of the following way the Stock Retainer is to be
delivered: (a) on the date which is three years after the Effective Date for
which it was originally payable ("Third Anniversary"), (b) on the date upon
which the Participant ceases to be a Director or Consultant for any reason
("Departure Date") or (c) in five equal annual installments commencing on the
Departure Date ("Third Anniversary" and "Departure Date" each being referred
to herein as a "Delivery Date"). Such Deferral Election shall remain in effect
for each Subsequent Year unless changed, provided that, any Deferral Election
with respect to a particular Year may not be changed less than six (6) months
prior to the beginning of such Year and provided, further, that no more than
one Deferral Election or change thereof may be made in any Year.
Any Deferral Election and any change or revocation thereof shall be made by
delivering written notice thereof to the Committee no later than six (6) months
prior to the beginning of the Year in which it is to be effected; provided that
with respect to the Year beginning on the Effective Date, any Deferral Election
or revocation thereof must be delivered no later than the close of business on
the thirtieth (30th) day after the Effective Date.
7. Deferred Stock Accounts.
The Company shall maintain a Deferred Stock Account for each Participant who
makes a Deferral Election to which shall be credited, as of the applicable
Payment Time, the number of shares of Common Stock payable pursuant to the
Stock Retainer to which the Deferral Election relates. So long as any amounts
in such Deferred Stock Account have not been delivered to the Participant
under Section 8, each Deferred Stock Account shall be credited as of the
payment date for any dividend paid or other distribution made with respect to
the Common Stock, with a number of shares of Common Stock equal to (a) the
number of shares of Common Stock shown in such Deferred Stock Account on the
record date for such dividend or distribution multiplied by (b) the Dividend
Equivalent for such dividend or distribution.
8. Delivery of Shares.
(a) The shares of Common Stock in a Participant's Deferred Stock Account with
respect to any Stock Retainer for which a Deferral Election has been made
(together with dividends attributable to such shares credited to such Deferred
Stock Account) shall be delivered in accordance with this Section 8 as soon as
practicable after the applicable Delivery Date. Except with respect to a
Deferral Election pursuant to Section 6(c), or other agreement between the
parties, such shares shall be delivered at one time; provided that, if the
number of shares so delivered includes a fractional share, such number shall be
rounded to the nearest whole number of shares. If the Participant has in
effect a Deferral Election pursuant to Section 6(c), then such shares shall be
delivered in five equal annual installments (together with dividends
attributable to such shares credited to such Deferred Stock Account), with the
first such installment being delivered on the first anniversary of the
Delivery Date; provided that, if in order to equalize such installments,
fractional shares would have to be delivered, such installments shall be
adjusted by rounding to the nearest whole share. If any such shares are to be
delivered after the Participant has died or become legally incompetent, they
shall be delivered to the Participant's estate or legal guardian, as the case
may be, in accordance with the foregoing; provided that, if the Participant
dies with a Deferral Election pursuant to Section 6(c) in effect, the Committee
shall deliver all remaining undelivered shares to the Participant's estate
immediately. References to a Participant in this Plan shall be deemed to refer
to the Participant's estate or legal guardian, where appropriate.
(b) The Company may, but shall not be required to, create a grantor trust or
utilize an existing grantor trust (in either case, "Trust") to assist it in
accumulating the shares of Common Stock needed to fulfill its obligations under
this Section 8. However, Participants shall have no beneficial or other
interest in the Trust and the assets thereof, and their rights under the Plan
shall be as general creditors of the Company, unaffected by the existence or
nonexistence of the Trust, except that
deliveries of Stock Retainers to Participants from the Trust shall, to the
extent thereof, be treated as satisfying the Company's obligations under this
Section 8.
9. Share Certificates; Voting and Other Rights.
The certificates for shares delivered to a Participant pursuant to Section 8
above shall be issued in the name of the Participant, and from and after the
date of such issuance the Participant shall be entitled to all rights of a
shareholder with respect to Common Stock for all such shares issued in his
or her name, including the right to vote the shares, and the Participant shall
receive all dividends and other distributions paid or made with respect
thereto.
10. General Restrictions.
(a) Notwithstanding any other provision of the Plan or agreements made
pursuant thereto, the Company shall not be required to issue or deliver any
certificate or certificates for shares of Common Stock under the Plan prior to
fulfillment of all of the following conditions:
(i) Listing or approval for listing upon official notice of issuance of such
shares on the New York Stock Exchange, Inc., or such other securities exchange
as may at the time be a market for the Common Stock;
(ii) Any registration or other qualification of such shares under any state
or federal law or regulation, or the maintaining in effect of any such
registration or other qualification which the Committee shall, upon the advice
of counsel, deem necessary or advisable; and
(iii) Obtaining any other consent, approval, or permit from any state or
federal governmental agency which the Committee shall, after receiving the
advice of counsel, determine to be necessary or advisable.
(b) Nothing contained in the Plan shall prevent the Company from adopting
other or additional compensation arrangements for the Participants.
11. Shares Available.
Subject to Section 12 below, the maximum number of shares of Common Stock which
may in the aggregate be paid as Stock Retainers pursuant to the Plan is Twenty
Million (20,000,000). Shares of Common Stock issueable under the Plan may be
taken from treasury shares of the Company or purchased on the open market.
12. Adjustments; Change of Control.
(a) In the event that there is, at any time after the Board adopts the Plan,
any change in corporate capitalization, such as a stock split, combination of
shares, exchange of shares, warrants or rights offering to purchase Common
Stock at a price below its fair market value, reclassification, or
recapitalization, or a corporate transaction, such as any merger,
consolidation, separation, including a spin-off, or other extraordinary
distribution of stock or property of the Company, any reorganization (whether
or not such reorganization comes within the definition of such term in
Section 368 of the Code) or any partial or complete liquidation of the Company
(each of the foregoing a "Transaction"), in each case other than any such
Transaction which constitutes a Change of Control (as defined below), (i) the
Deferred Stock Accounts shall be credited with the amount and kind of shares or
other property which would have been received by a holder of the number of
shares of Common Stock held in such Deferred Stock Account had such shares of
Common Stock been outstanding as of the effectiveness of any such Transaction,
(ii) the number and kind of shares or other property subject to the Plan shall
likewise be appropriately adjusted to reflect the effectiveness of any such
Transaction and (iii) the Committee shall appropriately adjust any other
elevant provisions of the Plan and any such modification by the Committee
shall be binding and conclusive on all persons.
(b) If the shares of Common Stock credited to the Deferred Stock Accounts are
converted pursuant to Section 12(a) into another form of property, references
in the Plan to the Common Stock shall be deemed, where appropriate, to refer
tosuch other form of property, with such other modifications as may be required
for the Plan to operate in accordance with its purposes. Without limiting the
generality of the foregoing, references to delivery of certificates for shares
of Common Stock shall be deemed to refer to delivery of cash and the incidents
of ownership of any other property held in the Deferred Stock Accounts.
(c) In lieu of the adjustment contemplated by Section 12(a), in the event of a
Change of Control, the following shall occur on the date of the Change of
Control: (i) the shares of Common Stock held in each Participant's Deferred
Stock Account shall be deemed to be issued and outstanding as of the
Change of Control; (ii) the Company shall forthwith deliver to each Participant
who has a Deferred Stock Account all of the shares of Common Stock or any other
property held in such Participant's Deferred Stock Account; and (iii) the Plan
shall be terminated.
(d) For purposes of this Plan, Change of Control shall mean any of the
following events:
(i) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or
more of either (a) the then outstanding shares of common stock of the Company
("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 ("Outstanding Company Voting
securities"); provided, however, that the following acquisitions shall not
constitute a Change of Control: (a) any acquisition directly from the
Company (excluding an acquisition by virtue of the exercise of a conversion
privilege unless the security being so converted was itself acquired directly
from the Company), (b) any acquisition by the Company, (c) any acquisition by
any employee benefit plan (or related trust) sponsored or maintained by the
Company or any corporation controlled by the Company or (d) any acquisition by
any corporation pursuant to a reorganization, merger or consolidation, if,
following such reorganization, merger or consolidation, the conditions
described in clauses (a), (b) and (c) of paragraph (iii) of this Section
12(d) are satisfied; or
(ii) Individuals who, as of the date hereof, constitute the Board of the
Company (as of the date hereof, "Incumbent Board") cease for any reason to
constitute at least a majority of the Board;
provided, however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or
other actual or threatened solicitation of proxies or consents by or on behalf
of a Person other than the Board; or
(iii) Approval by the shareholders of the Company of a reorganization,
merger, binding share exchange or consolidation, unless, following such
reorganization, merger, binding share exchange or consolidation (a) more than
sixty percent (60%) of, respectively, the then outstanding shares of
common stock of the corporation resulting from such reorganization, merger,
binding share exchange or consolidation and the combined voting power of the
then outstanding voting securities of such corporation entitled to vote
generally in the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately
prior to such reorganization, merger, binding share exchange or consolidation
in substantially the same proportions as their ownership, immediately
prior to such reorganization, merger, binding share exchange or consolidation,
of the Outstanding Company Common Stock and Outstanding Company Voting
securities, as the case may be, (b) no Person (excluding the Company, any
employee benefit plan (or related trust) of the Company or such corporation
resulting from such reorganization, merger, binding share exchange or
consolidation and any Person beneficially owning, immediately prior to such
reorganization, merger, binding share exchange or consolidation, directly or
indirectly, twenty percent (20%) or more of the Outstanding Company Common
Stock or Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, twenty percent (20%) or more of,
respectively, the then outstanding shares of common stock of the corporation
resulting from such reorganization, merger, binding share exchange or
consolidation or the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election
of directors and (c) at least a majority of the members of the board of
directors of the corporation resulting from such reorganization, merger,
binding share exchange or consolidation were members of the Incumbent
Board at the time of the execution of the initial agreement providing for such
reorganization, merger, binding share exchange or consolidation; or
(iv) Approval by the shareholders of the Company of (a) a complete
liquidation or dissolution of the Company or (b) the sale or other disposition
of all or substantially all of the assets of the Company, other than to a
corporation, with respect to which following such sale or other disposition,
(x) more than sixty percent (60%) of, respectively, the then outstanding shares
of common stock of such corporation and the combined voting power of the then
outstanding voting securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned, directly or indirectly,
by all or substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such sale or other
disposition in substantially the same proportion as their ownership,
immediately prior to such sale or other disposition, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the case
may be, (y) no Person (excluding the Company and any employee benefit plan (or
related trust) of the Company or such corporation and any Person beneficially
owning, immediately prior to such sale or other disposition, directly or
indirectly, twenty percent (20%) or more of the Outstanding Company
Common Stock or Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, twenty percent (20%) or more of,
respectively, the then outstanding shares of common stock of such corporation
and the combined voting power of the then outstanding voting securities of
such corporation entitled to vote generally in the election of directors and
(z) at least a majority of the members of the board of directors of such
corporation were members of the Incumbent Board at the time of the execution
of the initial agreement or action of the Board providing for such sale or
other disposition of assets of the Company.
13. Administration; Amendment and Termination.
(a) The Plan shall be administered by a committee consisting of three members
who shall be the current directors of the Company or senior executive officers
or other directors who are not Participants as may be designated by the Chief
Executive Officer ("Committee"), which shall have full authority to construe
and interpret the Plan, to establish, amend and rescind rules and
regulations relating to the Plan, and to take all such actions and make all
such determinations in connection with the Plan as it may deem necessary or
desirable. (b) The Board may from time to time make such amendments to the
Plan, including to preserve or come within any exemption from liability under
Section 16(b) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as it may deem proper and in the best interest of the Company without
further approval of the Company's stockholders, provided that, to the extent
required under New York law or to qualify transactions under the Plan for
exemption under Rule 16b-3 promulgated under the Exchange Act, no amendment to
the Plan shall be adopted without further approval of the Company's
stockholders and, provided, further, that if and to the extent required for the
Plan to comply with Rule 16b-3 promulgated under the Exchange Act, no amendment
to the Plan shall be made more than once in any six (6) month period that would
change the amount, price or timing of the grants of Common Stock hereunder other
than to comport with changes in the Internal Revenue Code of 1986, as
amended, the Employee Retirement Income Security Act of 1974, as amended, or
the regulations thereunder. (c) The Board may terminate the Plan at any time
by a vote of a majority of the members thereof.
14. Miscellaneous.
(a) Nothing in the Plan shall be deemed to create any obligation on the part
of the Board to nominate any Director for reelection by the Company's
shareholders or to limit the rights of the shareholders to remove any Director.
(b) The Company shall have the right to require, prior to the issuance or
delivery of any shares of Common Stock pursuant to the Plan, that a Participant
make arrangements satisfactory to the Committee for the withholding of any
taxes required by law to be withheld with respect to the issuance or delivery
of such shares, including without limitation by the withholding of shares that
would otherwise be so issued or delivered, by withholding from any other
payment due to the Participant, or by a cash payment to the Company by the
Participant.
15. Governing Law.
The Plan and all actions taken thereunder shall be governed by and construed in
accordance with the laws of the State of Nevada.
The Majestic Companies, Ltd.
By: /s/ Francis A. Zubrowski
Francis A. Zubrowski, President/Chief Executive Officer
