EXHIBIT 10.3

 

Fision Holdings, Inc.

 

STOCK OPTION AND COMPENSATION PLAN

 

Amended July 18, 2013

Second Amendment December 30, 2014

 

1. Purpose. The purpose of this 2011 Stock Option and Compensation Plan (the
"Plan") ofFision Holdings, Inc. (the "Company") is to increase stockholder value
and to advance the interests of the Company by furnishing a variety of economic
incentives ("Incentives") designed to attract, retain and motivate employees and
certain key consultants. Incentives may consist of opportunities to purchase or
receive shares of Common Stock, $.0001 par value, of the Company ("Common
Stock"), monetary payments, or both on terms determined under this Plan.

 

2. Administration. The Plan shall be administered by the Stock Option Committee
(the "Committee") of the Board of Directors of the Company, or the entire Board
of Directors, until such time as a stock option committee is formed. The
Committee shall consist of not less than two directors of the Company to be
appointed from time to time by the Board of Directors of the Company. Each
member of the Committee shall be a "disinterested person" within the meaning of
Rule 16b-3 of the Securities Exchange Act of 1934, and the regulations
promulgated thereunder (the "1934 Act"). The Board of Directors of the Company
may from time to time appoint members of the Committee in substitution for, or
in addition to, members previously appointed, and may fill vacancies, however
caused, in the Committee. The Committee shall select one of its members as its
chairman and shall hold its meetings at such times and places as it shall deem
advisable. A majority of the Committee's members shall constitute a quorum. All
action of the Committee shall be taken by the majority of its members. Any
action may be taken by a written instrument signed by majority of the members
and any action so taken shall be fully effective as if it had been made by a
majority vote at a meeting duly called and held. The Committee may appoint a
secretary, shall keep minutes of its meetings and shall make such rules and
regulations for the conduct of its business as it shall deem advisable. The
Committee shall have complete authority to award Incentives under the Plan, to
interpret the Plan, and to make any other determination which it believes
necessary and advisable for the proper administration of the Plan. The
Committee's decisions and matters relating to the Plan shall be final and
conclusive on the Company and its participants.

 

3. Eligible Participants. Employees of or consultants to the Company or its
subsidiaries or affiliates (including officers and directors, but excluding
directors who are not also employees of or consultants to the Company or its
subsidiaries or affiliates) shall become eligible to receive Incentives under
the Plan when designated by the Committee. Participants may be designated
individually or by groups or categories (for example, by pay grade) as the
Committee deems appropriate. Participation of officers of the Company or its
subsidiaries or affiliates and any performance objectives relating to such
officers' participation must be approved by the Committee. Participation by
others and any performance objectives relating to others may be approved by
groups or categories (for example, by pay grade) and authority to designate
participants who are not officers and to set or modify such targets may be
delegated.

 

4. Types of Incentives/Awards. Incentives under the Plan may be granted in
anyone or a combination of the following forms: (a) incentive stock options and
non-statutory stock options (section 6); (b) stock appreciation rights ("SARs")
(section 7); (c) stock awards (section 8); (d) restricted stock (section 8); (e)
performance shares (section 9); and (f) cash awards (section 10).

 

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5. Shares Subject to the Plan.

 

5.1. Number of Shares. Subject to adjustment as provided in Section 11.6, the
number of shares of Common Stock which may be issued under the Plan shall not
exceed 3,100,000 shares of $.0001 par value Common Stock.

 

5.2. Cancellation. To the extent that cash in lieu of shares of Common Stock is
delivered upon the exercise of a SAR pursuant to Section 7.4, the Company shall
be deemed, for purposes of applying the limitation on the number of shares, to
have issued the greater of the number of shares of Common Stock which it was
entitled to issue upon such exercise or on the exercise of any related option.
In the event that a stock option or SAR granted hereunder expires or is
terminated or canceled unexercised as to any shares of Common Stock, such shares
may again be issued under the Plan either pursuant to stock options, SARs or
otherwise. In the event that shares of Common Stock are issued as restricted
stock or pursuant to a stock award and thereafter are forfeited or reacquired by
the Company pursuant to rights reserved upon issuance thereof, such forfeited
and reacquired shares may again be issued under the Plan, either as restricted
stock, pursuant to stock awards or otherwise. The Committee may also determine
to cancel, and agree to the cancellation of, stock options in order to make a
participant eligible for the grant of a stock option at a lower price than the
option to be canceled.

 

5.3. Type of Common Stock. Common Stock issued under the Plan in connection with
stock options, SARS, performance shares, restricted stock or stock awards may be
in the form of authorized and unissued shares.

 

6. Stock Options. A stock option is a right to purchase shares of Common Stock
from the Company. Each stock option granted by the Committee under this Plan
shall be subject to the following terms and conditions:

 

6.1. Price. The option price per share shall be determined by the Committee
subject to adjustment under Section 11.6.

 

6.2. Number. The number of shares of Common Stock subject to the option shall be
determined by the Committee, subject to adjustment as provided in Section 11.6.
The number of shares of Common Stock subject to a stock option shall be reduced
in the same proportion that the holder thereof exercises a SAR if any SAR is
granted in conjunction with or related to the stock option.

 

6.3. Duration and Time for Exercise. Subject to earlier termination as provided
in Section 11.4, the term of each stock option shall be determined by the
Committee but shall not exceed ten years and one day from the date of grant.
Each stock option shall become exercisable at such time or times during its term
as shall be determined by the Committee at the time of grant. The Committee may
accelerate the exercisability of any stock option. Subject to the foregoing and
with the approval of the Committee, all or any part of the shares of Common
Stock with respect to which the right to purchase has accrued may be purchased
by the Company at the time of such accrual or at any time or times thereafter
during the term of the option.

 

6.4. Manner of Exercise. A stock option may be exercised, in whole or in part,
by giving written notice to the Company, specifying the number of shares of
Common Stock to be purchased and accompanied by the full purchase price for such
shares. The option price shall be payable in United States dollars upon exercise
of the option and may be paid by cash; uncertified or certified check; bank
draft; by delivery of shares of Common Stock in payment of all or any part of
the option price (cashless exercise) which shares shall be valued for this
purpose at the Fair Market Value on the date such option is exercised; by
instructing the Company to withhold from the shares of Common Stock issuable
upon exercise of the stock option shares of Common Stock in payment of all or
any part of the option price, which shares shall be valued for this purpose at
the Fair Market Value or in such other manner as may be authorized from time to
time by the Committee. Prior to the issuance of shares of Common Stock upon the
exercise of a stock option, a participant shall have no rights as a stockholder.

 

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6.5. Incentive Stock Options. Notwithstanding anything in the Plan to the
contrary, the following additional provisions shall apply to the grant of stock
options which are intended to qualify as Incentive Stock Options (as such term
is defined in Section 422A of the Internal Revenue Code of 1986, as amended):

 

(a) The aggregate Fair Market Value (determined as of the time the option is
granted) of the shares of Common Stock with respect to which Incentive Stock
Options are exercisable for the first time by any participant during any
calendar year (under all of the Company's plans) shall not exceed $100,000;

 

(b) Any Incentive Stock Option certificate authorized under the Plan shall
contain such other provisions as the Committee shall deem advisable, but shall
in all events be consistent with and contain all provisions required in order to
qualify the options as Incentive Stock Options;

 

(c) All Incentive Stock Options must be granted within ten years from the
earlier of the date on which this Plan was adopted by the Board of Directors or
the date this Plan was approved by the stockholders;

 

(d) Unless sooner exercised, all Incentive Stock Options shall expire no later
than 10 years after the date of grant; and

 

(e) The option price for Incentive Stock Options shall be not less than the Fair
Market Value of the Common Stock subject to the option on the date of grant; and

 

7. Stock Appreciation Rights. A SAR is a right to receive, without payment to
the Company, a number of shares of Common Stock, cash or any combination
thereof, the amount of which is determined pursuant to the formula set forth in
Section 7.4. A SAR may be granted (a) with respect to any stock option granted
under this Plan, either concurrently with the grant of such stock option or at
such later time as determined by the Committee (as to all or any portion of the
shares of Common Stock subject to the stock option), or (b) alone, without
reference to any related stock option. Each SAR granted by the Committee under
this Plan shall be subject to the following terms and conditions:

 

7.1. Number. Each SAR granted to any participant shall relate to such number of
shares of Common Stock as shall be determined by the Committee, subject to
adjustment as provided in Section 11.6. In the case of a SAR granted with
respect to a stock option, the number of shares of Common Stock to which the SAR
pertains shall be reduced in the same proportion that the holder of the option
exercises the related stock option.

 

7.2. Duration. Subject to earlier termination as provided in Section 11.4, the
term of each SAR shall be determined by the Committee but shall not exceed ten
years and one day from the date of grant. Unless otherwise provided by the
Committee, each SAR shall become exercisable at such time or times, to such
extent and upon such conditions as the stock option, if any, to which it
relates, is exercisable. The Committee may in its discretion accelerate the
exercisability of any SAR.

 

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7.3. Exercise. A SAR may be exercised, in whole or in part, by giving written
notice to the Company, specifying the number of SARs which the holder wishes to
exercise. Upon receipt of such written notice, the Company shall, within 90 days
thereafter, deliver to the exercising holder certificates for the shares of
Common Stock or cash or both, as determined by the Committee, to which the
holder is entitled pursuant to Section 7.4.

 

7.4. Payment. Subject to the right of the Committee to deliver cash in lieu of
shares of Common Stock (which, as it pertains to officers and directors of the
Company, shall comply with all requirements of the 1934 Act), the number of
shares of Common Stock which shall be issuable upon the exercise of a SAR shall
be determined by dividing the number of shares of Common Stock as to which the
SAR is exercised multiplied by the amount of the appreciation in such shares
(for this purpose, the "appreciation" shall be the amount by which the Fair
Market Value of the shares of Common Stock subject to the SAR on the exercise
date exceeds (1) in the case of a SAR related to a stock option, the purchase
price of the shares of Common Stock under the stock option or (2) in the case of
a SAR granted alone, without reference to a related stock option, an amount
which shall be determined by the Committee at the time of grant, subject to
adjustment under Section 11.6 by the Fair Market Value of a share of Common
Stock on the exercise date.

 

In lieu of issuing shares of Common Stock upon the exercise of a SAR, the
Committee may elect to pay the holder of the SAR cash equal to the Fair Market
Value on the exercise date of any or all of the shares which would otherwise be
issuable. No fractional shares of Common Stock shall be issued upon the exercise
of a SAR; instead, the holder of the SAR shall be entitled to receive a cash
adjustment equal to the same fraction of the Fair Market Value of a share of
Common Stock on the exercise date or to purchase the portion necessary to make a
whole share at its Fair Market Value on the date of exercise.

 

8. Stock Awards and Restricted Stock. A stock award consists of the transfer by
the Company to a participant of shares of Common Stock, without other payment
therefore, as additional compensation for services to the Company. A share of
restricted stock consists of shares of Common Stock which are sold or
transferred by the Company to a participant at a price determined by the
Committee (which price shall be at least equal to the minimum price required by
applicable law for the issuance of a share of Common Stock) and subject to
restrictions on their sale or other transfer by the participant. The transfer of
Common Stock pursuant to stock awards and the transfer and sale of restricted
stock shall be subject to the following terms and conditions:

 

8.1. Number of Shares. The number of shares to be transferred or sold by the
Company to a participant pursuant to a stock award or as restricted stock shall
be determined by the Committee.

 

8.2. Sale Price. The Committee shall determine the price, if any, at which
shares of restricted stock shall be sold to a participant, which may vary from
time to time and among participants and which may be below the Fair Market Value
of such shares of Common Stock at the date of sale.

 

8.3. Restrictions. All shares of restricted stock transferred or sold hereunder
shall be subject to such restrictions as the Committee may determine, including,
without limitation any or all of the following:

 

(a) a prohibition against the sale, transfer, pledge or other encumbrance of the
shares of restricted stock, such prohibition to lapse at such time or times as
the Committee shall determine (whether in annual or more frequent installments,
at the time of the death, disability or retirement of the holder of such shares,
or otherwise);

 

(b) a requirement that the holder of shares of restricted stock forfeit, or (in
the case of shares sold to a participant) resell back to the Company at his or
her cost, all or a part of such shares in the event of termination of his or her
employment or consulting engagement during any period in which such shares are
subject to restrictions; and

 

(c) such other conditions or restrictions as the Committee may deem advisable.

 

8.4. Escrow. In order to enforce the restrictions imposed by the Committee
pursuant to Section 8.3, the participant receiving restricted stock shall enter
into an agreement with the Company setting forth the conditions of the grant.
Shares of restricted stock shall be registered in the name of the participant
and deposited, together with a stock power endorsed in blank, with the Company.
Each such certificate shall bear a legend in substantially the following form:

 

"The transferability of this certificate and the shares of Common Stock
represented by it are subject to the terms and conditions (including conditions
of forfeiture) contained in the Stock Option and Compensation Plan of Fision
Holdings, Inc. (the "Company"), and an agreement entered into between the
registered owner and the Company. A copy of the Plan and the agreement is on
file in the office of the secretary of the Company."

 

8.5. End of Restrictions. Subject to Section 11.5, at the end of any time period
during which the shares of restricted stock are subject to forfeiture and
restrictions on transfer, such shares will be delivered free of all restrictions
to the participant or to the participant's legal representative, beneficiary or
heir.

 

8.6. Stockholder. Subject to the terms and conditions of the Plan, each
participant receiving restricted stock shall have all the rights of a
stockholder with respect to shares of stock during any period in which such
shares are subject to forfeiture and restrictions on transfer, including without
limitation, the right to vote such shares. Dividends paid in cash or property
other than Common Stock with respect to shares of restricted stock shall be paid
to the participant currently.

 

9. Performance Shares. A performance share consists of an award which shall be
paid in shares of Common Stock, as described below. The grant of performance
share shall be subject to such terms and conditions as the Committee deems
appropriate, including the following:

 

9.1. Performance Objectives. Each performance share will be subject to
performance objectives for the Company or one of its operating units to be
achieved by the end of a specified period. The number of performance shares
granted shall be determined by the Committee and may be subject to such terms
and conditions as the Committee shall determine. If the performance objectives
are achieved, each participant will be paid in shares of Common Stock or cash.
If such objectives are not met, each grant of performance shares may provide for
lesser payments in accordance with formulae established in the award.

 

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9.2. Not Stockholder. The grant of performance shares to a participant shall not
create any rights in such participant as-a stockholder of the Company until the
payment of shares of Common Stock with respect to an award.

 

9.3. No Adjustments. No adjustment shall be made in performance shares granted
on account of cash dividends which may be paid or other rights which may be
issued to the holders of Common Stock prior to the end of any period for which
performance objectives were established.

 

9.4. Expiration of Performance Share. If any participant's employment or
consulting engagement with the Company is terminated for any reason other than
normal retirement, death or disability prior to the achievement of the
participant's stated performance objectives, all the participant's rights on the
performance shares shall expire and terminate unless otherwise determined by the
Committee. In the event of termination by reason of death, disability, or normal
retirement, the Committee, in its own discretion, may determine what portions,
if any, of the performance shares should be' paid to the participant.

 

10. Cash Awards. A cash award consists of a monetary payment made by the Company
to a participant as additional compensation for his or her services to the
Company. Payment of a cash award will normally depend on achievement of
performance objectives by the Company or by individuals. The amount of any
monetary payment constituting a cash award shall be determined by the Committee
in its sole discretion. Cash awards may be subject to other terms and
conditions, which may vary from time to time and among participants, as the
Committee deems appropriate.

 

11. General.

 

11.1. Effective Date. The Plan will become effective upon its approval by the
shareholders with a majority of the outstanding shares of Common Stock of the
Company, pursuant to shareholder action on December 30, 2010, in accordance with
state law. Unless approved within one year after the date of the Plan's adoption
by the Committee, or by the Company's Board of Directors, the Plan shall not be
effective for any purpose.

 

11.2. Duration. The Plan shall remain in effect until all Incentives granted
under the Plan have either been satisfied by the issuance of shares of Common
Stock or the payment of cash or been terminated under the terms of the Plan and
all restrictions imposed on shares of Common Stock in connection with their
issuance under the Plan have lapsed. No Incentives may be granted under the Plan
after the tenth anniversary of the date the Plan is approved by the stockholders
of the Company.

 

11.3. Non-transferability of Incentives. No stock option, SAR, restricted stock
or performance award may be transferred, pledged or assigned by the holder
thereof except, in the event of the holder's death, by will or the laws of
descent and distribution or pursuant to a qualified domestic relations order as
defined by the Internal Revenue Code of 1986, as amended, per Title I of the
Employee Retirement Income Security Act, or the rules thereunder, and the
Company shall not be required to recognize any attempted assignment of such
rights by any participant. During a participant's lifetime, an Incentive may be
exercised only by him or her or by his or her guardian or legal representative.

 

11.4. Effect of Termination or Death. In the event that a participant ceases to
be an employee of or consultant to the Company for any reason, including death,
any Incentives may be exercised or shall expire at such times as may be
determined by the Committee.

 

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11.5. Additional Condition. Notwithstanding anything in this Plan to the
contrary:

 

(a) the Company may, if it shall determine it necessary or desirable for any
reason, at the time of award of any Incentive or the issuance of any shares of
Common Stock pursuant to any Incentive, require the recipient of the Incentive,
as a condition to the receipt thereof or to the receipt of shares of Common
Stock issued pursuant thereto, to deliver to the Company a written
representation of present intention to acquire the Incentive or the shares of
Common Stock issued pursuant thereto for his or her own account for investment
and not for distribution; and (b) if at any time the Company further determines,
in its sole discretion, that the listing, registration or qualification (or any
updating of any such document) of any Incentive or the shares of Common Stock
issuable pursuant thereto is necessary on any securities exchange or under any
federal or state securities or blue sky law, or that the consent or approval of
any governmental regulatory body is necessary or desirable as a condition of, or
in connection with the award of any Incentive, the issuance of shares of Common
Stock pursuant thereto, or the removal of any restrictions imposed on such
shares, such Incentive shall not be awarded or such shares of Common Stock shall
not be issued or such restrictions shall not be removed, as the case may be, in
whole or in part, unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Company.

 

11.6. Adjustment. In the event of any merger, consolidation or reorganization of
the Company with any other corporation or corporations, there shall be
substituted for each of the shares of Common Stock then subject to the Plan,
including shares subject to restrictions, options, or achievement of performance
share objectives, the number and kind of shares of stock or other securities to
which the holders of the shares of Common Stock will be entitled pursuant to the
transaction. In the event of any recapitalization, stock dividend, stock split,
combination of shares or other change in the Common Stock, the number of shares
of Common Stock then subject to the Plan, including shares subject to
restrictions, options or achievements of performance shares, shall be adjusted
in proportion to the change in outstanding shares of Common Stock. In the event
of any such adjustments, the purchase price of any option, the performance
objectives of any Incentive, and the shares of Common Stock issuable pursuant to
any Incentive shall be adjusted as and to the extent appropriate, in the
discretion of the Committee, to provide participants with the same relative
rights before and after such adjustment.

 

11.7. Incentive Plans and Agreements. Except in the case of stock awards or cash
awards, the terms of each Incentive shall be stated in a plan or agreement
approved by the Committee. The Committee may also determine to enter into
agreements with holders of options to reclassify or convert certain outstanding
options, within the terms of the Plan, as Incentive Stock Options, or as
non-statutory stock options and in order to eliminate SARs with respect to all
or part of such options and any other previously issued options.

 

11.8. Withholding.

 

(a) The Company shall have the right to withhold from any payments made under
the Plan or to collect as a condition of payment, any taxes required by law to
be withheld. At any time when a participant is required to pay to the Company an
amount required to be withheld under applicable income tax laws in connection
with a distribution of Common Stock or upon exercise of an option or SAR, the
participant may satisfy this obligation in whole or in part by electing (the
"Election") to have the Company withhold from the distribution shares of Common
Stock having a value up to the amount required to be withheld. The value of the
shares to be withheld shall be based on the Fair Market Value of the Common
Stock on the date that the amount of tax to be withheld shall be determined
("Tax Date").

 

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(b) Each Election must be made prior to the Tax Date. The Committee may
disapprove of any Election, may suspend or terminate the right to make
Elections, or may provide with respect to any Incentive that the right to make
Elections shall not apply to such Incentive. An Election is irrevocable.

 

(c) If a participant is an officer or director of the Company within the meaning
of Section 16 of the 1934 Act, then an Election must comply with all of the
requirements of the 1934 Act.

 

11.9. No Continued Employment, Engagement or Right to Corporate Assets. No
participant under the Plan shall have any right, because of his or her
participation, to continue in the employ of, or to continue his or her
consulting engagement for, the Company for any period of time or any right to
continue his or her present or any other rate of compensation. Nothing contained
in the Plan shall be construed as giving an employee, a consultant, such
persons' beneficiaries or any other person any equity or interests of any kind
in the assets of the Company or creating a trust of any kind or a fiduciary
relationship of any kind between the Company and any such person.

 

11.10. Deferral Permitted. Payment of cash or distribution of any shares of
Common Stock to which a participant is entitled under any Incentive shall be
made as provided in the Incentive. Payment may be deferred at the option of the
participant if provided in the Incentive.

 

11.11. Amendment of the Plan. The Committee or the Board of Directors may amend
or discontinue the Plan at any time. However, no such amendment or
discontinuance shall, subject to adjustment under Section 11.6: (a) change or
impair, without the consent of the recipient, an Incentive previously granted;
(b) materially increase the maximum number of shares of Common Stock which may
be issued to all participants under the Plan; (c) materially increase the
benefits which may be granted under the Plan; (d) materially modify the
requirements as to eligibility for participation in the Plan; or (e) materially
increase the benefits accruing to participants under the Plan.

 

11.12. Immediate Acceleration of Incentives. Notwithstanding any provision in
this Plan or in any Incentive to the contrary: (1) the restrictions on all
shares of restricted stock shall lapse immediately; (2) all outstanding options
and SARs will become exercisable immediately; and (3) all performance shares
shall be deemed to be met and payment made immediately, if subsequent to the
date that the Plan is approved by the Committee, or the Board of Directors of
the Company, any of the following events occur, unless otherwise determined by
the Board of Directors and a majority of the Continuing Directors (as defined
below):

 

(1) any person or group of persons becomes the beneficial owner of 40% or more
of any equity security of the Company entitled to vote for the election of
directors;

 

(2) a majority of the members of the Board of Directors of the Company is
replaced within the period of less than 24 months by directors not nominated and
approved by the then existing Board of Directors; or

 

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(3) the stockholders of the Company approve an agreement to merge or consolidate
with or into another corporation or an agreement to sell or otherwise dispose of
all or substantially all of the Company's assets (including a plan of
liquidation ).

 

For purposes of this Section 11.12, beneficial ownership by a person or group of
persons shall be determined in accordance with Regulation 13D (or any similar
successor regulation) promulgated by the Securities and Exchange Commission
pursuant to the 1934 Act. Beneficial ownership of more than 30% of an equity
security may be established by any reasonable method, but shall be presumed
conclusively as to any person who files a Schedule 13D report with the
Securities and Exchange Commission reporting such ownership. If the restrictions
and forfeitability periods are eliminated by reason of the provision in (1)
above, the limitations of this Plan shall not become applicable again should the
person cease to own 30% or more of any equity security of the Company.

 

For purposes of this Section 11.12, "Continuing Directors" are directors: (a)
who were in office prior to the time that any of the provisions in (1), (2) or
(3) above occurred or any person who has publicly announced an intention to
acquire 30% or more of any equity security of the Company; (b) directors in
office for a period of more than two years; and (c) directors nominated and
approved by the existing Continuing Directors.

 

11.13. Definition of Fair Market Value. Whenever "Fair Market Value" of Common
Stock shall be determined for purposes of this Plan, it shall be determined by
reference to the last sale price of a share of Common Stock on the principal
United States Securities Exchange registered under the 1934 Act on which the
Common Stock is listed (the "Exchange"), or, on the National Association of
Securities Dealers, Inc. Automatic Quotation System (including the National
Market system) ("NASDAQ") on the applicable date; however, if the Company's
Common Stock has not yet been listed on any Exchange, the Board of Directors may
determine any reasonable alternate methodology to determine "Fair Market Value."
If the Exchange or NASDAQ is closed for trading on such date, or if the Common
Stock does not trade on such date, then the last sale price used shall be the
one on the date the Common Stock last traded on the Exchange or NASDAQ.

 

 

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