<PAGE> 1
As filed with the Securities and Exchange Commission on July 24, 1997
SEC File No. 33-14065-D
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
DRY DAIRY INTERNATIONAL, INC.
- -----------------------------
(Exact name of registrant as specified in its charter)
UTAH 87-0476117
- ------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10105 Amberwood Road, Ft. Myers, Florida 33913
- ---------------------------------------- ---------
(Address of Principal Executive Offices) (Zip Code)
1997 Non-Qualified Stock Option Plan
- ------------------------------------
(Full title of the plan)
R. Lee Matzig, 10105 Amberwood Road, Ft. Myers, FL 33913
----------------------------------------------------------
(Name, address, including zip code of agent for service)
Telephone number, including area code, of agent for service: (941) 768-3555
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Per Offering Registration
Registered Registered (2) Share (1) Price Fee
- ---------- ---------- ---------- ---------- ------------
<C> <C> <C> <C> <C>
Common Stock,
$0.001 par
value 3,000,000 $ 0.075 $225,000 $100.00
</TABLE>
(1) Bona fide estimate of maximum offering price solely for the purpose of
calculating the registration fee, based on the average of the bid and ask
price of the Registrant's common stock on July 18, 1997, as reported on the
NASD's OTC Bulletin Board.
PAGE
<PAGE> 2
DRY DAIRY INTERNATIONAL, INC.
Cross Reference Sheet Pursuant to Rule 404(a)
Cross-reference between items of part I of form S-8 and the section 10(a)
prospectus which will be delivered to each employee, director or consultant
who participates in the stock option plan.
Registration Statement Item Numbers and Headings Prospects Headings
- ------------------------------------------------ ------------------
1) Plan Information Section 10(a) Prospectus
2) Registration Information and Employee
Plan Annual Information Section 10(a) Prospectus
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are hereby
incorporated by reference:
1) The Company's Annual Report on Form 10-KSB for the year ended
December 31, 1996.
2) All reports filed by the Company with the Commission pursuant to
section 13(a) or 15(d) of the Exchange Act December 31, 1996.
All reports and other documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 12, or 15(d) of the Exchange Act prior to the filing of
any post-effective amendment which indicates that all securities covered by
this Prospectus have been sold or which deregisters all such securities then
remaining unsold shall be deemed to be incorporated by reference herein and to
be a part hereof from the date of the filing of such reports and documents.
ITEM 4. DESCRIPTION OF SECURITIES
Common Stock
The Company is authorized to issue 50,000,000 shares of common stock, par
value $0.001 per share (the "Common Stock"). The holders of the Common Stock
are entitled to one vote per share on each matter submitted to a vote at any
meeting of shareholders. Shares of Common Stock do not carry cumulative
voting rights and, therefore, a majority of the shares of outstanding Common
Stock will be able to elect the entire board of directors and, if they do so,
minority shareholders would not be able to elect any persons to the board of
directors. The Company's articles of incorporation and bylaws provide that a
majority of the issued and outstanding shares of the Company shall constitute
a quorum for shareholders' meetings, except with respect to certain matters
for which a different percentage quorum is required by statute.
PAGE
<PAGE> 3
Shareholders of the Company have no preemptive rights to acquire
additional shares of Common Stock or other securities. The Common Stock is
not subject to redemption and carries no subscription or conversion rights. In
the event of liquidation of the Company, the shares of Common Stock are
entitled to share equally in corporate assets after satisfaction of all
liabilities and payment of any preferences on preferred stock.
Holders of Common Stock are entitled to receive such dividends as the
board of directors may from time to time declare out of funds legally
available for the payment of dividends.
The board of directors has the authority to issue the authorized but
unissued shares of Common Stock without action by the shareholders. The
issuance of such shares would reduce the percentage ownership held by persons
purchasing Common Stock in this offering and may dilute the book value of the
then existing shareholders.
Registrar and Transfer Agent
The registrar and transfer agent of the Company's securities is Colonial
Stock Transfer, 455 East 400 South, Salt Lake City, Utah 84111 (801)
355-5742.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
No expert or counsel for the Company named in this registration statement
as having prepared or certified any part hereof, or as giving an opinion as to
the validity of the securities being registered was employed on a contingency
basis, or has or is to receive, in connection with the offering, a substantial
interest in the Company or its subsidiaries. In addition no such expert or
counsel is connected with the Company or its subsidiaries as a promoter,
managing underwriter, voting trustee, director, officer, or employee.
PAGE
<PAGE> 4
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The following is a brief summary of certain indemnification provisions of
the Company's articles of incorporation and the Utah Revised Business
Corporation Act. This summary is qualified in its entirety by reference to
the text thereof.
Section 16-10a-901 through 909 of the Utah Revised Business Corporation
Act, as amended (the "Corporation Act"), permits a Utah corporation to
indemnify its directors and officers for certain of their acts. More
specifically, Sections 16-10a-902 and 16-10a-907 of the Corporation Act grant
authority to any corporation to indemnify directors and officers against any
judgments, fines, amounts paid in settlement and reasonable expenses,
including attorney's fees, by reason of his or her having been a corporate
director or officer. Such provision is limited to instances where the
director or officer acted in good faith and in a manner he or she reasonable
believed to be in or not opposed to the best interests of the corporation, or,
in criminal proceedings, he or she had no reasonable cause to believe his or
her conduct was unlawful. Such sections confer on the director or officer an
absolute right to indemnification for expenses, including attorney's fees,
actually and reasonably incurred by him or her to the extent he or she is
successful on the merits or otherwise defense of any claim, issue, or matter.
The corporation may not indemnify a director if the director is adjudged
liable to the corporation or deemed to have derived an improper personal
benefit in an action in which the director is adjudged liable. Section 16
10a-906 of the Corporation Act expressly makes indemnification contingent upon
a determination that indemnification is proper in the circumstances. Such
determination must be made by the board of directors acting through a quorum
of disinterested directors, or by the board of directors acting on the advice
of independent legal counsel, or by the shareholders. Further, Section 16-10a
904 of the Corporation Act permits a corporation to pay attorney's fees and
other litigation expenses on behalf of a director or office in advance of the
final disposition of the action upon receipt of an undertaking by or on behalf
of such director or officer to repay such expenses to the corporation if its
is ultimately determined that he or she is not entitled to be indemnified by
the corporation or to the extent the expenses so advanced by the corporation
exceed the indemnification to which he or she is entitled. Such
indemnification provisions do not exclude other indemnification rights to
which a director or officer may be entitled under the corporation's
certificate or articles of incorporation, bylaws, an agreement, a vote of
shareholders, or otherwise. The corporation may also purchase and maintain
insurance to provide indemnification.
The foregoing discussion of indemnification merely summarizes certain
aspects of the indemnification provisions of the Corporation Act and is
limited by reference to the above discussed section of the Corporation Act.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to members of the board of directors, officers,
employees, or persons controlling the Company pursuant to the foregoing
provisions, the Company has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
PAGE
<PAGE> 5
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
No restricted securities are being reoffered or resold pursuant to this
registration statement.
ITEM 8. EXHIBITS
Exhibits.
Copies of the following documents are included as exhibits to this
registration statement pursuant to item 601 of regulation S-K.
SEC
Exhibit Reference
No. No. Description Location
- ------- --------- ----------- --------
3.01 3 Articles of Incorporation Incorporated
by Reference*
3.02 3 Bylaws Incorporated
by Reference*
4.01 4 Specimen certificate
for Common Stock Incorporated
by Reference*
4.02 4 Dry Diary International, Inc.
1997 Non-Qualified Stock Option Plan This Filing
5.01 5 & 23 Letter opinion, including consent
of Taylor and Associates, Inc.
Attorneys and Counselors at Law,
regarding legality of Common Stock
to be issued pursuant to options
granted under the Plan. This Filing
23.01 23 Consent of Jones, Jensen & Company,
independent certified public
accountants This Filing
25.01 25 Powers of Attorney See Signature
Page
* Incorporated by reference from the Company's registration statement on
Form S-18 filed with the Commission, SEC file No. 33-14065-D.
PAGE
<PAGE> 6
ITEM 9. UNDERTAKINGS
REGULATION S-K
Post-Effective Amendments - Item 512(a)
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement, to include
any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to
such information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
Filings Incorporating Subsequent Exchange Act Documents by Reference - Item
512(b)
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended , each
filing of the Registrant's annual report pursuant to section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(a) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Filing of Registration Statement on Form S-8 - Item 512(h)
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer, or controlling person of the Registrant in the
successful defense of any action, suit, or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction, the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
<PAGE> 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of Ft. Myers, State of Florida, on the
21st day of July, 1997.
DRY DIARY INTERNATIONAL, INC.
By /S/ R. Lee Matzig, President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints R. Lee Matzig, with power of substitution, as
his attorney-in-fact for him, in all capacities, to sign any amendments to
this registration statement and to file the same, with exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that said attorney-in-fact or
his substitutes may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
- --------- ----- ----
/S/ Phillip R. Lacerte Chairman of the Board July 21, 1997
/S/ Rosemarie Drygala Director July 21, 1997
/S/ Rainer Drygala Director July 21, 1997
<PAGE>
EXHIBIT NO. 5 & 23
TAYLOR AND ASSOCIATES
3090 East 3300 South, Suite 400
Salt Lake City, UT 84109
July 21, 1997
Board of Directors
Dry Dairy International, Inc.
10105 Amberwood Road
Ft. Myers, Florida 33913
Re: Dry Dairy International, Inc.
Registration Statement on Form S-8
Ladies and Gentlemen:
We have been retained by Dry Dairy International, Inc. (the "Company") in
connection with the registration statement (the "Registration Statement") on
Form S-8 to be filed by the Company with the Securities and Exchange
Commission relating to the securities of the Company. You have requested that
we render our opinion as to whether or not the securities proposed to be
issued on the terms set forth in the Registration Statement will be validly
issued, fully paid, and nonassessable.
In connection with this request, we have examined the following:
1. Articles of Incorporation of the Company, and amendments thereto;
2. Bylaws of the Company;
3. Unanimous consent resolutions of the Company's board of directors;
4. The Registration Statement; and
5. The Company's 1997 Non-Qualified Stock Option Plan.
We have examined such other corporate records and documents and have
made such other examinations as we have deemed relevant.
Based on the above examination, we are of the opinion that the
securities of the Company to be issued pursuant to the Registration Statement
are validly authorized and, when issued in accordance with the terms set forth
in the Registration Statement, will be validly issued, fully paid, and
nonassessable under corporate laws of the state of Utah.
This opinion is limited in scope to the shares to be issued pursuant to
the Registration Statement and does not cover subsequent issuance of shares to
be made in the future. Such transactions are required to be included in
either a new registration statement or a post-effective amendment to the
Registration Statement, including updated opinions concerning the validity of
issuance of such shares.
Further, we consent to our name, Taylor and Associates, Inc. being
included in the Registration Statement as having rendered the foregoing
opinion and as having represented the Company in connection with the
Registration Statement.
Sincerely,
TAYLOR AND ASSOCIATES, INC.
/S/Elliott N. Taylor
<PAGE>
EXHIBIT NO. 23
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated February 6, 1997, accompanying the
financial statements of Dry Dairy International, Inc., included in its annual
report on Form 10-KSB for the fiscal year ended December 31, 1996, and hereby
consent to the incorporation by reference to such report in this Registration
Statement on Form S-8.
/S/ JONES, JENSEN & COMPANY
50 Main Street, Suite 1450
Salt Lake City, UT 84144
July 21, 1997
<PAGE> 1
EXHIBIT NO. 4
DRY DAIRY INTERNATIONAL, INC.
1997 Non-Qualified Stock Option Plan
DRY DAIRY INTERNATIONAL, INC., a Utah corporation (the "Company"), hereby
adopts this 1997 Non-Qualified Stock Option Plan (the "Plan"), this 17th day
of July, 1997, under which options to acquire stock of the Company may be
granted from time to time to employees and consultants of the Company or its
subsidiaries. In addition, at the discretion of the board of directors,
options to acquire stock of the Company may from time to time be granted under
this Plan to other individuals who contribute to the success of the Company or
its subsidiaries and are not employees of the Company, all on the terms and
conditions set forth herein.
1. PURPOSE OF THE PLAN. The Plan is intended to aid the Company in
maintaining and developing a management team, attracting qualified officers
and employees capable of assisting in the future success of the Company, and
rewarding those individuals who have contributed to the success of the
Company. It is designed to aid the Company in retaining the services of
executives and employees and in attracting new personnel when needed for
future operations and growth and to provide such personnel with an incentive
to remain employees of the Company, to use their best efforts to promote the
success of the Company's business, and to provide them with an opportunity to
obtain or increase a proprietary interest in the Company. It is also designed
to permit the Company to reward those individuals who are not employees of the
Company but who are perceived by management as having contributed to the
success of the Company or who are important to the continued business and
operations of the Company. The above aims will be effectuated through the
granting of options ("Options") to purchase shares of common stock of the
Company, par value $0.001 per share (the "Stock"), subject to the terms and
conditions of this Plan.
2. EFFECTIVE DATE. The Plan shall become effective immediately on
adoption by the board of directors of the Company (the "Board").
3. ADMINISTRATION OF THE PLAN. Administration of the Plan shall be
by the Board. Subject to compliance with applicable provisions of the
governing law, the Board may delegate administration of the Plan or specific
administrative duties with respect to the Plan, on such terms and to such
committees of the Board as it deems proper; provided however, that if less
than the entire Board is administering the Plan or grants under the Plan,
action may be taken only by a committee of two or more "disinterested
directors" as that term is defined in Rule 16b-3, and the regulations and
releases thereunder all as promulgated by the Securities and Exchange
Commission under authority of the Exchange Act of 1934, as amended. Any
Option approved by the Board shall be approved by a majority vote of those
members of the Board in attendance at a meeting at which a quorum is present.
Any Option approved by a committee designated by the Board shall be approved
as specified by the Board at the time of delegation. The interpretation and
construction of the terms of the Plan by the Board or a duly authorized
committee shall be final and binding on all participants in the Plan absent a
showing of demonstrable error. No member of the Board or duly authorized
committee shall be liable for any action taken or determination made in good
faith with respect to the Plan.
<PAGE> 2
4. SHARES OF STOCK SUBJECT TO THE PLAN. A total of three million
(3,000,000)shares of Stock may be subject to, or issued pursuant to, Options
granted under the terms of this Plan. Any shares subject to an Option under
the Plan, which Option for any reason expires or is forfeited, terminated, or
surrendered unexercised as to such shares, shall be added back to the total
number of shares reserved for issuance under the terms of this Plan, and if
any right to acquire Stock granted under the Plan is exercised by the delivery
of shares of Stock or the relinquishment of rights to shares of Stock, only
the net shares of Stock issued (the shares of Stock issued less the shares of
Stock surrendered) shall count against the total number of shares reserved for
issuance under the terms of this Plan.
5. RESERVATION OF STOCK ON GRANTING OF OPTION. At the time of
granting any Option under the terms of this Plan, there will be reserved for
issuance on the exercise of the Option the number of shares of Stock of the
Company subject to such Option. The Company may reserve either authorized but
unissued shares or issued shares that have been reacquired by the Company.
6. ELIGIBILITY. Options under the Plan may be granted to employees,
including officers, and directors of the Company or its subsidiaries, as may
be existing from time to time, and to other individuals who are not employees
of the Company, but performed bona fide services to the Company, as may be
deemed in the best interest of the Company by the Board or a duly authorized
committee. Such Options shall be in the amounts, and shall have the rights
and be subject to the restrictions, as may be determined by the Board or a
duly authorized committee, all as may be within the general provisions of this
Plan.
7. TERM OF OPTIONS AND CERTAIN LIMITATIONS ON RIGHT TO EXERCISE.
(a) Each Option shall have the term established by the Board or duly
authorized committee at the time the Option is granted but in no event may an
Option have a term in excess of five (5) years.
(b) The term of the Option, once it is granted, may be reduced only
as provided for in this Plan and under the written provisions of the Option.
(c) Unless otherwise specifically provided by the written provisions
of the Option, no holder or his or her legal representative, legatee, or
distributee will be, or shall be deemed to be, a holder of any shares subject
to an Option unless and until the holder exercises his or her right to acquire
all or a portion of the Stock subject to the Option and delivers the required
consideration to the Company in accordance with the terms of this Plan and
then only to the extent of the number of shares of Stock acquired. Except as
specifically provided in this Plan or as otherwise specifically provided by
the written provisions of the Option, no adjustment to the exercise price or
the number of shares of Stock subject to the Option shall be made for
dividends or other rights for which the record date is prior to the date the
Stock subject to the Option is acquired by the holder.
<PAGE> 3
(d) Options under the Plan shall vest and become exercisable at such
time or times and on such terms as the Board or a duly authorized committee
may determine at the time of the grant of the Option.
(e) Options granted under the Plan shall contain such other
provisions, including, without limitation, further restrictions on the vesting
and exercise of the Option, as the Board or a duly authorized committee shall
deem advisable.
(f) In no event may an Option be exercised after the expiration of
its term.
8. EXERCISE PRICE. The exercise price of each Option issued under
the Plan shall be determined by the Board or a duly authorized committee on
the date of grant.
9. PAYMENT OF EXERCISE PRICE. The exercise of any Option shall be
contingent on receipt by the Company of cash, certified bank check to its
order, or other consideration acceptable to the Company; provided, that at the
discretion of the Board or a duly authorized committee, the written provisions
of the Option may provide that payment can be made in whole or in part in
shares of Stock of the Company, which Stock shall be valued at its then fair
market value as determined by the Board or a duly authorized committee, or by
the surrender or cancellation of other rights to Stock of the Company. Any
consideration approved by the Board or a duly authorized committee, that calls
for the payment of the exercise price over a period of more than one year
shall provide for interest, which shall not be included as part of the
exercise price, that is equal to or exceeds the imputed interest provided for
in section 483 of the Internal Revenue Code of 1986, as amended (the "Code")
or any amendment or successor section of like tenor.
10. WITHHOLDING. If the grant or exercise of an Option pursuant to
this Plan is subject to withholding or other trust fund payment requirements
of the Code or applicable state or local laws, such requirements may, at the
discretion of the Board or a duly authorized committee and to the extent
permitted by the terms of the Option and the then governing provisions of the
Code and the Exchange Act, be met (i) by the holder of the Option either
delivering shares of Stock or canceling Options or other rights to acquire
Stock with a fair market value equal to such requirements; (ii) by the Company
withholding shares of Stock subject to the Option with a fair market value
equal to such requirements; or (iii) by the Company making such withholding or
other trust fund payment and the Option holder reimbursing the Company such
amount paid within 10 days after written demand therefor from the Company.
PAGE
<PAGE> 4
11. DILUTION OR OTHER ADJUSTMENT. In the event that the number of
shares of Stock of the Company from time to time issued and outstanding is
increased pursuant to a stock split or a stock dividend, the number of shares
of Stock then covered by each outstanding Option granted hereunder shall be
increased proportionately, with no increase in the total purchase price of the
shares then so covered, and the number of shares of Stock subject to the Plan
shall be increased by the same proportion. In the event that the number of
shares of Stock of the Company from time to time issued and outstanding is
reduced by a combination or consolidation of shares, the number of shares of
Stock then covered by each outstanding Option granted hereunder shall be
reduced proportionately, with no reduction in the total purchase price of the
shares then so covered, and the number of shares of Stock subject to the Plan
shall be reduced by the same proportion. In the event that the Company should
transfer assets to another corporation and distribute the stock of such other
corporation without the surrender of Stock of the Company, and if such
distribution is not taxable as a dividend and no gain or loss is recognized by
reason of section 355 of the Code or any amendment or successor statute of
like tenor, then the total purchase price of the Stock then covered by each
outstanding Option shall be reduced by an amount that bears the same ratio to
the total purchase price then in effect as the market value of the stock
distributed in respect of a share of the Stock of the Company, immediately
following the distribution, bears to the aggregate of the market value at such
time of a share of the Stock of the Company plus the stock distributed in
respect thereof. In the event that the Company distributes the stock of a
subsidiary to its shareholders, makes a distribution of a major portion of its
assets, or otherwise distributes significant portion of the value of its
issued and outstanding Stock to its shareholders, the number of shares then
subject to each outstanding Option and the Plan, or the exercise price of each
outstanding Option, may be adjusted in the reasonable discretion of the Board
or a duly authorized committee. All such adjustments shall be made by the
Board or duly authorized committee, whose determination upon the same, absent
demonstrable error, shall be final and binding on all participants under the
Plan. No fractional shares shall be issued, and any fractional shares
resulting from the computations pursuant to this section shall be eliminated
from the respective Option. No adjustment shall be made for cash dividends,
for the issuance of additional shares of Stock for consideration approved by
the Board, or for the issuance to stockholders of rights to subscribe for
additional Stock or other securities.
12. OPTIONS TO FOREIGN NATIONALS. The Board or a duly authorized
committee may, in order to fulfill the purposes of this Plan and without
amending the Plan, grant Options to foreign nationals or individuals residing
in foreign countries that contain provisions, restrictions, and limitations
different from those set forth in this Plan and the Options made to United
States residents in order to recognize differences among the countries in law,
tax policy, and custom. Such grants shall be made in an attempt to provide
such individuals with essentially the same benefits as contemplated by a grant
to United States residents under the terms of this Plan.
<PAGE> 5
13. ASSIGNMENT. No Option granted under this Plan shall be
transferable other than by will or the laws of descent and distribution.
Options transferred by will or by laws of descent and distribution may be
exercised for a period of three months after receipt. After the expiration of
the three month exercise period, all such Options so transferred and the
rights and privileges thereunder will be null and void. Except as permitted by
the foregoing, each Option granted under the Plan and the rights and
privileges thereby conferred shall not be transferred, assigned, pledged, or
hypothecated in any way (whether by operation of law or otherwise), and shall
not be subject to execution, attachment, or similar process. On any attempt
to transfer, assign, pledge, hypothecate, or otherwise dispose of the Option,
or of any right or privilege conferred thereby, contrary to the provisions
thereof, or on the levy of any attachment or similar process on such rights
and privileges, the Option and such rights and privileges shall immediately
become null and void.
14. EFFECT OF TERMINATION OF EMPLOYMENT. In the event that any
holder is terminated or resigns from his or her position with the Company or a
subsidiary within six months of the grant of an award, any unexercised portion
of such Option shall immediately become null and void and such holder shall
have no further rights thereunder. In the event that any officer or employee
of the Company or a subsidiary is terminated at any time for, in the
determination of the Board or a duly authorized committee, gross negligence in
the performance of his or her duties, substantial failure to meet written
standards established by the Company for the performance of his or her duties,
criminal misconduct, or willful or gross misconduct in the performance of his
or her duties, the Board or a duly authorized committee may cancel any and all
rights such individual may have in the unexercised portion of any Option held
at the time of termination. The Board or a duly authorized committee may, at
the time of the grant of the Option, establish any other restrictions on the
exercise of such Option subsequent to the termination or resignation of any
individual that it deems appropriate. The foregoing paragraph shall not apply
to consultants who are issued options.
15. LISTING AND REGISTRATION OF SHARES. Each Option shall be subject
to the requirement that if at any time the Board shall determine, in its sole
discretion, that it is necessary or desirable to list, register, or qualify
the shares covered thereby on any securities exchange or under any state or
federal law, or obtain the consent or approval of any governmental agency or
regulatory body as a condition of, or in connection with, the granting of such
Option or the issuance or purchase of shares thereunder, such Option may not
be exercised in whole or in part unless and until such listing, registration,
consent, or approval shall have been effected or obtained free of any
conditions not acceptable to the Board.
16. EXPIRATION AND TERMINATION OF THE PLAN. The Plan may be
abandoned or terminated at any time by the Board or a duly authorized
committee except with respect to any Options then outstanding under the Plan.
The Plan shall otherwise terminate on the earlier of the date that is: (i)
ten years after the date the Plan is adopted by the Board; or (ii) ten years
after the date the Plan is approved by the shareholders of the Company.
<PAGE> 6
17. FORM OF OPTIONS. Options granted under the Plan shall be
represented by a written agreement which shall be executed by the Company and
the holder and which shall contain such terms and conditions as may be
determined by the Board or a duly authorized committee and permitted under the
terms of this Plan.
18. NO RIGHT OF EMPLOYMENT. Nothing contained in this Plan or any
Option awarded pursuant to this Plan shall be construed as conferring on a
director, officer, or employee any right to continue or remain as a director,
officer, or employee of the Company or its subsidiaries.
19. AMENDMENT OF THE PLAN. This Plan may not be amended more than
once during any six month period, other than to comport with changes in the
Code or the rules and regulations promulgated thereunder. Subject to the
foregoing and the limitations, the Board or a duly authorized committee may
modify and amend the Plan in any respect.
DRY DAIRY INTERNATIONAL, INC.
By:/S/ R. Lee Matzig, President
ATTEST:
The undersigned hereby attests to this DRY DAIRY INTERNATIONAL, INC.,
1997 Non-Qualified Stock Option Plan.
DRY DAIRY INTERNATIONAL, INC.
By:/S/ Rosemarie Drygala, Secretary
