Exhibit 10.7
TSI HANDLING, INC.
2000 EQUITY INCENTIVE PLAN
ARTICLE 1 - PURPOSE
The purpose of this Plan is to promote the interests of the Company and to
motivate, attract, and retain the services of persons upon whose judgment,
efforts, and contributions the success of the Company's business depends. The
plan is further intended to align the personal interests of such persons with
the interests of the shareholders of the Company through equity participation in
the Company's growth and success. Capitalized terms not otherwise defined in the
text are defined in Article 2.
ARTICLE 2 - DEFINITIONS
The following words and phrases shall have the following meanings for purposes
of this Plan:
(a) "Award" means any Option, or any Restricted Stock Award or any other right
or interest relating to Stock, cash or property, granted to a Participant
under the Plan.
(b) "Award Agreement" means any written agreement, contract, or other
instrument or document evidencing an Award.
(c) "Board of Directors" means the Board of Directors of the Company or, if the
context so requires, a Committee thereof appointed pursuant to Article 6.
(d) "Cause" means (i) conviction of any crime involving fraud or gross
misconduct, (ii) noncompliance with reasonable directives of the Board or
its designees, (iii) violation of Company rules, policies or procedures or
of the Plan or any applicable Award Agreement.
(e) "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
(f) "Committee" means the committee of the Board described in Article 6.
(g) "Disability" means the following: a Participant shall be disabled if he or
she is unable to perform the duties of his customary position of employment
by reason of any medically determinable physical or mental impairment which
can be expected to result in death or which can be expected to last for a
continuous period of not less than 12 months. The Board may require such
medical or other evidence, as it deems necessary to judge the nature and
permanency of the Participant's condition.
(h) "Effective Date" shall mean June 14, 1999.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
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(j) "Fair Market Value" means with respect to Stock or any other property, the
fair market value of such Stock or other property determined by the Board
in good faith using such methods or procedures as may be established from
time to time by the Board. Unless otherwise determined by the Board, the
Fair Market Value of Stock as of any date shall be the mean between the bid
and asked quotations for the Stock on that date as reported by the National
Association of Securities Dealers Automated Quotation System (NASDAQ) or,
if there are no bid or asked quotations on such date, the mean between the
bid and asked quotations on the next preceding date for which quotations
are available. If the Stock is subsequently listed and traded upon a
recognized securities exchange or shall be quoted on a recognized national
market system, the Fair Market Value shall be the closing price on such
date or, if no closing price is so reported for that date, the closing
price on the next preceding date for which a closing price was reported.
(k) "Incentive Stock Option" means an Option that is intended to meet the
requirements of Section 422 of the Code or any successor provision thereto.
(l) "Non-Qualified Stock Option" means an Option that is not intended to be an
Incentive Stock Option.
(m) "Option" means a right granted to a Participant under Article 7 of the Plan
to purchase Stock at a specified price during specified time periods. An
Option may be either an Incentive Stock Option or a Non-Qualified Stock
Option.
(n) "Participant" means a person who, as an employee, officer, director,
consultant, independent contractor, or adviser of the Company or any
Subsidiary, has been granted an Award under the Plan.
(o) "Plan" means TSI Handling, Inc. 1999 Equity Incentive Plan, as amended from
time to time.
(p) "Restricted Stock Award" means Stock granted to a Participant or offered
for sale to a Participant under Article 8.
(q) "Retirement" means a Participant's termination of employment with the
Company after attaining any normal or early retirement age specified in any
pension, profit sharing, or other retirement program sponsored by the
Company, if any.
(r) "Securities Act" means the Securities Act of 1933, as amended.
(s) "Stock" means Common Stock of the Company.
(t) "Subsidiary" means any corporation of which a majority of the outstanding
voting stock or voting power is beneficially owned directly or indirectly
by the Company.
(u) "Ten Percent Owner" means any individual who, at the date of grant of an
Incentive Stock Option, owns stock possessing more than ten percent of the
total combined voting power of all classes of Stock of the Company or a
Subsidiary. For purposes of determining such percentage, the individual
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with respect to whom such percentage is being determined shall be
considered as owning the Stock owned, directly or indirectly, by or for his
brothers and sisters (whether by the whole or half blood), spouse,
ancestors, and lineal descendants; and Stock owned, directly or indirectly,
by or for a corporation, partnership, estate, or trust, shall be considered
as being owned proportionately by or for its shareholders, partners, or
beneficiaries.
(v) "Termination Date" means the date on which the employment (or other service
or relationship in the case of a Participant who is not an employee of the
Company) of a Participant terminates for any reason or no reason.
(w) "Transfer Agent" means American Securities Transfer & Trust, Inc. or its
successor or assigns.
ARTICLE 3 - EFFECTIVE DATE AND TERM
3.1 Effective Date. The Plan was approved by the Board of Directors and
stockholders of the Company as of the Effective Date.
3.2 Term. This Plan shall terminate on the tenth anniversary of the Effective
Date, subject to Article 12.
ARTICLE 4 - SHARES SUBJECT TO THE PLAN
4.1 Number of Shares. The aggregate number of shares of Stock reserved and
available for Awards shall initially be three million (3,000,000) shares of
Stock.
4.2 Lapsed Awards. To the extent that an Award terminates, expires or lapses for
any reason, any shares of Stock subject to the Award will again be available for
the grant of an Award under the Plan provided the Participant has not received
any benefits of ownership of the Shares subject to the terminated expired or
lapsed Award, in each case to the full extent available pursuant to the
applicable rules and interpretations of the Exchange Act and Code.
4.3 Payments in Stock. Any shares of Stock tendered to or withheld by the
Company in connection with payment for Stock purchased pursuant to the Plan or
withholding taxes thereon shall be added back to the aggregate number of shares
reserved and available for Awards under the Plan in each case to the fullest
extent permitted under the applicable rules and interpretations of the Exchange
Act and Code.
4.4 Stock Distributed. Any Stock distributed pursuant to an Award may consist,
in whole or in part, of authorized and unissued Stock, treasury Stock, or Stock
purchased on the open market subject to applicable rules and interpretation of
the Exchange Act.
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ARTICLE 5 - ELIGIBILITY
Awards may be granted only to an individual who is an employee (including an
employee who also is a director or officer), officer, director, consultant,
independent contractor, or adviser of the Company or a Subsidiary, as determined
by the Board.
ARTICLE 6 - ADMINISTRATION AND AUTHORITY
6.1 Administration. The Plan shall be administered by the Board or a Committee
appointed by the Board to administer the Plan at any time or from time to time.
Once appointed, the Committee shall continue to serve until otherwise directed
by the Board. From time to time, the Board may increase the size of the
Committee and appoint additional members thereof, remove members (with or
without cause), appoint new members in substitution therefor, and fill vacancies
however caused.
6.2 Authority. The Committee (or if authorized as Committee, the Board) has the
exclusive power, authority, and discretion to:
(a) designate Participants;
(b) determine the type or types of Awards to be granted to each Participant;
(c) determine the number of Awards to be granted and the number of shares of
Stock subject to an Award;
(d) prescribe the form of each Award Agreement, which need not be identical for
each Participant;
(e) determine the terms and conditions of any Award granted under the Plan,
including but not limited to, the exercise price, grant price, or purchase
price, any restrictions or limitations on the Award, any schedule for lapse
of forfeiture restrictions or restrictions on the exercisability of an
Award and accelerations or waivers thereof, and any modification or
amendment of any Award previously granted, based in each case on such
considerations as the Board in its sole discretion determines;
(f) determine whether, to what extent, and under what circumstances an Award
may be settled in, or the exercise price of an Award may be paid in, cash,
Stock, other Awards, or other property, or an Award may be canceled,
forfeited, or surrendered;
(g) determine whether, to what extent, and under what circumstances cash,
Stock, other Awards, other property, and other amounts payable with respect
to an Award shall be deferred either automatically or at the election of
the holder thereof or of the Board;
(h) decide all other matters that must be determined in connection with an
Award;
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(i) establish, adopt, or revise any rules and regulations as it may deem
necessary or advisable to administer the Plan;
(j) interpret the Plan, any Award, and any Award Agreement in its discretion;
and
(k) make all other decisions and determinations that may be required under the
Plan or as the Board deems necessary or advisable to administer the Plan.
6.3 Decisions Binding. All decisions, interpretations, and determinations by the
Board with respect to the Plan, any Award, and any Award Agreement are final,
binding, and conclusive on all parties.
ARTICLE 7 - STOCK OPTIONS
7.1 Terms and Conditions. The Board is authorized to grant Options to
Participants on the following terms and conditions:
(a) Exercise Price. The exercise price per share of Stock under an Option shall
be determined by the Board.
(b) Payment. Payment for Stock issued upon exercise of an Option shall be made
in accordance with Article 9 of the Plan.
(c) Time and Conditions of Exercise. The Board shall determine the time or
times at which an Option may be exercised in whole or in part, provided
that no Option may be exercisable prior to six months following the date of
the grant of such Option if and to the extent such limitation is necessary
or required under Rule 16b-3, or successor authority, under the Exchange
Act.
(d) Evidence of Option. All Options shall be evidenced by a written Award
Agreement between the Company and the Participant. The Award Agreement
shall include such provisions as may be specified by the Board.
7.2 Incentive Stock Options. The terms of any Incentive Stock Options granted
under the Plan must comply with the following additional rules:
(a) Employees Only. Incentive Stock Options may only be granted to employees
(including officers and directors who are also employees) of the Company or
a Subsidiary.
(b) Exercise Price. The exercise price per share of Stock shall be set by the
Board, provided that the exercise price for any Incentive Stock Option may
not be less than the Fair Market Value as of the date of the grant.
(c) Exercise. In no event may any Incentive Stock Option be exercisable for
more than ten years from the date of its grant.
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(d) Individual Dollar Limitation. The aggregate Fair Market Value (determined
as of the time an Award is made) of all shares of Stock with respect to
which Incentive Stock Options are first exercisable by any one Participant
in any calendar year may not exceed $100,000. Options granted in excess of
this limitation shall be deemed to be Non-Qualified Stock Options.
(e) Ten Percent Owners. An Incentive Stock Option may be granted to a Ten
Percent Owner, provided that at the time such option is granted the
exercise price per share of Stock shall not be less than 110% of the Fair
Market Value and such option by its terms is not exercisable after the
expiration of five years from the date of its grant.
(f) Expiration of Incentive Stock Options. No Award of an Incentive Stock
Option may be made pursuant to this Plan after the expiration of ten years
from the Effective Date.
(g) Right to Exercise. During a Participant's lifetime, an Incentive Stock
Option may be exercised only by the Participant.
(h) Tax-Qualified ISOP Options. All provisions of the Plan relating to
Incentive Stock Options shall be administered and interpreted in
accordance, and so as to comply, with the provisions of Section 422 of the
Code.
7.3 Termination of Participant. Notwithstanding the exercise periods set forth
in any Award Agreement, Options shall be subject to the following:
(a) An Option shall lapse ten years after it is granted, unless an earlier time
is set in the Award Agreement.
(b) If a Participant's employment is terminated due to Disability, Retirement,
or for any other reason other than for Cause, such Participant may exercise
his or her Incentive Stock Options only to the extent that such Incentive
Stock Options would have been exercisable on the Termination Date;
provided, that such exercise is made prior to the earlier of (i) the
expiration of three months (one year in the case of Disability) after the
Termination Date or (ii) the expiration date of the Option set forth in the
Award Agreement. If a Participant's employment is terminated due to Cause,
the Participant's Incentive Stock Options shall automatically lapse and not
be exercisable by the Participant, whether or not such Options were vested.
(c) Except as otherwise provided in the Award Agreement or thereafter
determined by the Board in writing, if a Participant's employment,
contractual or other relationship with the Company is terminated due to
Disability, Retirement, or for any other reason other than for Cause, such
Participant may exercise his or her Non-Qualified Stock Options, only to
the extent that such Options would have been exercisable on the Termination
Date; provided, that such exercise is made within six months after the
Termination Date, or such other time period as set forth in the Award
Agreement. If a Participant's employment, contractual or other relationship
is terminated due to Cause, the Participant's Non-Qualified Stock Options
shall automatically lapse and not be exercisable by the Participant,
whether or not such Options were vested.
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(d) If a Participant dies before his or her Options lapse pursuant to this
Section, then the Participant's Options may be exercised, only to the
extent that such Options would have been exercisable on the date of the
Participant's death; provided, that such exercise is made prior to the
earlier of (i) the first anniversary of such Participant's death or (ii)
the expiration date of the Option set forth in the Award Agreement. Upon
the Participant's death, any exercisable Options may be exercised by the
Participant's legal representative or representatives.
ARTICLE 8 - RESTRICTED STOCK AWARDS
8.1 Restricted Stock Awards. The Board is authorized to make Awards of
Restricted Stock to Participants either in the form of a grant of Stock or an
offer to sell Stock to a Participant, in such amounts and subject to such terms,
conditions and restrictions as may be selected by the Board. All Awards of
Restricted Stock shall be evidenced by an Award Agreement. An Award Agreement
may specify whether, and to what extent, holders of Restricted Stock Awards
shall have voting, dividend and other rights of holders of Stock.
8.2 Issuance and Restrictions. Restricted Stock shall be subject to such
restrictions on transferability and other restrictions, including without
limitation "vesting" or forfeiture restrictions, as the Board may impose. These
restrictions may lapse separately or in combination at such times, under such
circumstances, in such installments, or otherwise, as the Board determines at
the time of the grant of the Award or thereafter.
8.3 Forfeiture. Except as otherwise determined by the Board at the time of the
grant of the Award or thereafter, upon termination of employment during the
applicable restriction period, Restricted Stock that is at that time subject to
restrictions shall be forfeited and reacquired by the Company; provided,
however, that the Board may provide in any Award Agreement that restrictions or
forfeiture conditions relating to Restricted Stock will be waived in whole or in
part in specified circumstances, and the Board may in other cases waive in whole
or in part restrictions or forfeiture conditions relating to Restricted Stock.
8.4 Payment and Certificates for Restricted Stock. If a Restricted Stock Award
provides for the purchase of Stock by a Participant, payment shall be made
pursuant to Article 9 of the Plan. Restricted Stock granted under the Plan may
be evidenced in such manner as the Board shall determine. To the extent that an
Award is granted in the form of newly issued Restricted Stock, the Award
recipient, as a condition to the grant of such an Award, shall be required to
pay to the Company in cash, cash equivalents or other legal consideration an
amount equal to the par value of such Restricted Stock. To the extent that an
Award is granted in the form of Restricted Stock from the Company's treasury, no
such cash consideration shall be required of the Award recipients. If
certificates representing shares of Restricted Stock are registered in the name
of the Participant, certificates must bear an appropriate legend referring to
the terms, conditions, and restrictions applicable to such Restricted Stock, and
the Company shall retain physical possession of the certificate until such time
as all applicable restrictions lapse.
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ARTICLE 9 - PAYMENT FOR STOCK PURCHASES; WITHHOLDING TAXES; RELOAD OPTIONS
9.1 Payment. Payment for Stock purchased pursuant to the Plan may be made in
cash (by check) or, where expressly approved for the Participant by the Board in
an Award Agreement or otherwise in writing and where permitted by law:
(a) by cancellation of indebtedness of the Company to the Participant;
(b) by surrender of (or attestation to the ownership of) Stock valued at Fair
Market Value on the date new Stock is purchased under the Plan; provided,
however, that such surrender or attestation shall not be permitted if such
action would cause the Company to recognize compensation expense (or
additional compensation expense) with respect to the Award for financial
reporting purposes;
(c) by waiver of compensation due or accrued to Participant for services
rendered;
(d) by tender of property acceptable to the Board;
(e) with respect only to purchases upon exercise of an Option, and provided
that a public market for the Stock then exists:
(i) through a "same day sale" commitment from Participant and a
broker-dealer that is a member of the National Association of
Securities Dealers (a "NASD Dealer") whereby Participant irrevocably
elects to exercise the Option and to sell a portion of the Stock so
purchased to pay for the exercise price (and any applicable
withholding taxes), and whereby the NASD Dealer irrevocably commits
upon receipt of such Stock to forward the exercise price and any such
withholding taxes directly to the Company's Transfer Agent;
(ii) through a "margin" commitment from Participant and a NASD Dealer
whereby Participant irrevocably elects to exercise the Option and to
pledge the Stock so purchased to the NASD Dealer in a margin account
as security for a loan from the NASD Dealer in the amount of the
exercise price (and any applicable withholding taxes), and whereby
the NASD Dealer irrevocably commits upon receipt of such Stock to
forward the exercise price and any such withholding taxes directly to
the Company's Transfer Agent; or
(iii) through any other "cashless exercise" procedure approved by the
Board; or
(iv) by any combination of the foregoing, or any other method of payment
acceptable to the Board in its sole discretion.
9.2 Loan Guarantees. The Board may, in its discretion, help the Participant pay
for Shares purchased under the Plan by authorizing a guarantee by the Company of
a third-party loan to the Participant.
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9.3 Tax Withholding. The Company or any Subsidiary shall have the authority 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 arising as a result of this Plan. Whenever,
under the Plan, payments in satisfaction of Awards are to be made in cash, such
payment shall be net of an amount sufficient to satisfy federal, state, and
local withholding tax requirements. With respect to withholding required upon
any taxable event relating to the issuance of Stock under the Plan, Participants
may elect (the "Election"), on or prior to the date of such taxable event, to
satisfy the withholding requirement, in whole or in part, by having the Company
or any Subsidiary withhold shares of Stock having a Fair Market Value on the
date of withholding equal to the amount to be withheld for tax purposes. The
Board may disapprove any Election or may suspend or terminate the right to make
Elections. An Election is irrevocable. The Board may, at the time any Award is
granted, require that any and all applicable tax withholding requirements be
satisfied by the withholding of shares of Stock as set forth above.
9.4 Reload Options. Award Agreements may contain a provision pursuant to which a
Participant who pays all or a portion of the exercise price of an Option or the
tax required to be withheld pursuant to an exercise of an Option by surrendering
shares of Stock pursuant to Sections 9.1 or 9.3, respectively, shall be
automatically granted an Option for the purchase of Stock equal to the number of
shares surrendered (a "Reload Option"). The grant of the Reload Option shall be
effective on the date the Participant surrenders the shares of Stock in respect
of which the Reload Option is granted (the "Reload Date"). The Reload Option
shall have an exercise price equal to the Fair Market Value of the Stock on the
Reload Date, and shall have a term which is no longer, and which shall lapse no
later, than the original term of the underlying option. If Stock otherwise
available under an Incentive Stock Option is withheld pursuant to Section 9.3,
any Reload Option granted in connection with the withholding shall be treated as
a new Incentive Stock Option, subject to the rules set forth in Section 7.2.
ARTICLE 10 - PROVISIONS APPLICABLE TO AWARDS
10.1 Stand Alone, Tandem, and Substitute Awards. Awards granted under the Plan
may, in the discretion of the Board, be granted either alone or in addition to,
in tandem with, or in substitution for, any other Award granted under the Plan.
Awards granted in addition to or in tandem with other Awards may be granted
either at the same time as or at a different time from the grant of such other
Awards.
10.2 Modification or Assumption of Awards. Within the limitations of the Plan,
the Board may modify, extend or assume outstanding Awards or may accept the
cancellation of outstanding Awards (whether granted by the Company or by another
issuer) in return for the grant of new Awards for the same or a different number
of shares and at the same or a different exercise price. The foregoing
notwithstanding, no modification of an Award shall, without the consent of the
Participant, alter or impair his or her rights or obligations under such Award.
10.3 Exchange Provisions. The Board may at any time offer to exchange or buy out
any previously granted Award for a payment in cash, Stock, or another Award,
based on the terms and conditions the Board determines and communicates to the
Participant at the time the offer is made.
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10.4 Term of Award. The term of each Award shall be for the period as determined
by the Board, provided that in no event shall the term of any Incentive Stock
Option exceed a period of ten years from the date of its grant.
10.5 Form of Payment for Awards. Subject to the terms of the Plan and any
applicable law or Award Agreement, payments or transfers to be made by the
Company or a Subsidiary on the grant or exercise of an Award may be made in such
forms as the Board determines at or after the time of grant, including without
limitation, cash, Stock, other Awards, or other property, or any combination,
and may be made in a single payment or transfer, in installments, or on a
deferred basis, in each case determined in accordance with rules adopted by, and
at the discretion of, the Board.
10.6 Limits on Transfer. No right or interest of a Participant in any Award may
be pledged, encumbered, or hypothecated to or in favor of any party other than
the Company or a Subsidiary, or shall be subject to any lien, obligation, or
liability of such Participant to any other party other than the Company or a
Subsidiary. Except as otherwise provided below, no Award shall be assignable or
transferable by a Participant other than by will or the laws of descent and
distribution or, except in the case of an Incentive Stock Option, pursuant to a
"domestic relations order" as defined in the Code or Title I of the Employee
Retirement Income Security Act, or the rules thereunder. In the Award Agreement
for any Award other than an Award that includes an Incentive Stock Option, the
Board may allow a Participant to assign or otherwise transfer all or a portion
of the rights represented by the Award to specified individuals or classes of
individuals, or to a trust benefiting such individuals or classes of
individuals, subject to such restrictions, limitations, or conditions as the
Board deems appropriate. At the discretion of the Board, the Company may reserve
to itself or its assignees in any Award a right of first refusal to purchase any
Stock which a Participant may propose to transfer to a third party and/or a
right to repurchase any and all Stock held by a Participant upon the
Participant's termination of employment or other relationship with the Company
or its Parent or Subsidiary for any reason, including Death or Disability, at a
price for such Stock as determined by the Board.
10.7 Lock-up Agreement. In addition to any other restrictions on transfer, a
Participant shall not, without the prior written consent of the Board in its
discretion, offer or sell any Stock acquired pursuant to the Plan for at least
180 days after the closing of the initial public offering of securities of the
Company registered under the Securities Act, or in the event that subsequent to
such initial public offering the Stock is not listed and traded upon a
recognized securities exchange or quoted on a recognized national market system,
the closing of each offering of securities of the Company registered under the
Securities Act subsequent to such initial public offering through and including
the offering after which the Stock is listed and traded upon such exchange or
system.
10.8 Stock Certificates. All Stock certificates delivered under the Plan are
subject to any stop-transfer orders and other restrictions as the Board deems
necessary or advisable to comply with federal or state securities laws, rules,
and regulations and the rules of any national securities exchange or automated
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quotation system on which the Stock is listed, quoted, or traded. The Board may
place legends on any Stock certificate to reference restrictions applicable to
the Stock.
ARTICLE 11 - CHANGES IN CAPITAL STRUCTURE
11.1 General; Adjustments. In the event of a subdivision of the outstanding
Stock, a declaration of a dividend payable in Stock, a declaration of a dividend
payable in a form other than Stock in an amount that has a material effect on
the price of the Stock, a combination or consolidation of the outstanding Stock
(by classification or otherwise) into a lesser number of shares of Stock, a
recapitalization, a spin-off or a similar occurrence, the Board shall make such
adjustments as it, in its sole discretion, deems appropriate in one or more of
(a) the number of shares of Stock available for future Awards under Article 4,
(b) the limitations set forth in Article 4, (c) the number and kind of shares of
Stock covered by each outstanding Award or (d) the exercise price under each
outstanding Option and other Award in the nature of rights that may be
exercised. Except as provided in this Article 11, a Participant shall have no
rights by reason of any issue by the Company of stock of any class or securities
convertible into stock of any class, any subdivision or consolidation of shares
of stock of any class, the payment of any stock dividend or any other increase
or decrease in the number of shares of stock of any class.
11.2 Dissolution or Liquidation. To the extent not previously exercised, Awards
shall terminate immediately prior to the dissolution or liquidation of the
Company.
11.3 Reorganizations. In the event that the Company is a party to a merger,
consolidation or other reorganization, outstanding Awards shall be subject to
the agreement of merger, consolidation or reorganization. The Board may cause
such agreement to provide, without limitation, (a) for the continuation of
outstanding Awards by the Company (if the Company is a surviving corporation),
(b) for their assumption by the surviving corporation or its parent or
subsidiary, (c) for the substitution by the surviving corporation or its parent
or subsidiary of its own awards for such Awards, (d) for accelerated vesting,
accelerated expiration and/or lapse of restrictions, or (e) for settlement in
cash or cash equivalents. If the Board does not cause such agreement to provide
for one of the alternatives in (a), (b), (c), (d) or (e) above, then all
outstanding Options and other Awards in the nature of rights that may be
exercised shall become fully exercisable and all restrictions on other Awards
shall lapse, upon the effectiveness of the transactions contemplated by such
agreement.
ARTICLE 12 - AMENDMENT, MODIFICATION, AND TERMINATION
12.1 General. With the approval of the Board, at any time and from time to time,
the Board may terminate, amend, or modify the Plan. An amendment or modification
of the Plan shall be subject to the approval of the shareholders of the Company
only to the extent required by applicable laws, regulations and rules.
12.2 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.
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ARTICLE 13 - GENERAL PROVISIONS
13.1 No Rights to Awards. No Participant or employee shall have any claim to be
granted any Award under the Plan, and neither the Company nor the Board is
obligated to treat Participants and employees uniformly.
13.2 No Stockholder Rights. No Award gives the Participant any of the rights of
a shareholder of the Company unless and until shares of Stock are in fact issued
to such person in connection with such Award.
13.3 No Right to Employment. Nothing in the Plan or any Award Agreement shall
interfere with or limit in any way the "at will" nature of any Participant's
employment or other relationship with the Company or any Subsidiary, nor confer
upon any Participant any right to continue in the employment or any other
relationship of the Company or any Subsidiary, and the Company and each
Subsidiary reserve the right to terminate any Participant's employment or other
relationship at any time.
13.4 Unfunded Status of Awards. The Plan is intended to be an "unfunded" plan
for incentive and deferred compensation. With respect to any payments not yet
made to a Participant pursuant to an Award, nothing contained in the Plan or any
Award Agreement shall give the Participant any rights that are greater than
those of a general creditor of the Company or any Subsidiary.
13.5 Relationship to Other Benefits. No payment under the Plan shall be taken
into account in determining any benefits under any pension, retirement, savings,
profit sharing, group insurance, welfare or other benefit plan of the Company or
any Subsidiary.
13.6 Expenses. The expenses of administering the Plan shall be borne by the
Company and its Subsidiaries.
13.7 Titles and Headings. The titles and headings of the Articles and Sections
in the Plan are for convenience of reference only, and in the event of any
conflict, the text of the Plan, rather than such titles or headings, shall
control.
13.8 Fractional Shares. No fractional shares of stock shall be issued and the
Board shall determine, in its discretion, whether cash shall be given in lieu of
fractional shares or whether such fractional shares shall be eliminated by
rounding up to the next whole number of shares.
13.9 Securities Law Compliance. With respect to any person who is, on the
relevant date, obligated to file reports under Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable
conditions of Section 16 or its successors under the Exchange Act. To the extent
any provision of the Plan or any Award Agreement or any action by the Board
fails to so comply, it shall be void to the extent required by law and voidable
as deemed advisable by the Board.
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13.10 Government and Other Regulations. The obligation of the Company to make
payment of awards in Stock or otherwise shall be subject to all applicable laws,
rules, and regulations, and to such approvals by government agencies as may be
required. The Company shall be under no obligation to register under the
Securities Act, any of the shares of Stock paid under the Plan. If the shares of
Stock paid under the Plan may in certain circumstances be exempt from
registration under the Securities Act, the Company may restrict the transfer of
such shares in such manner as it deems advisable to ensure the availability of
any such exemption.
13.11 Governing Law. The Plan and all Award Agreements shall be construed in
accordance with and governed by the laws of the State of Arizona.
13.12 Nonexclusivity of the Plan. Neither the adoption of the Plan nor the
submission of the Plan to the shareholders of the Company for approval shall be
construed as creating any limitations upon the right and authority of the Board
to adopt such other incentive compensation arrangements (which arrangements may
be applicable either generally to a class or classes of individuals or
specifically to a particular individual or individuals) as the Board in its
discretion determines desirable, including, without limitation, the granting of
stock options or other rights otherwise than under the Plan.
DATED: June 14, 1999
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