Exhibit 10.1

 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
ABRAXAS PETROLEUM CORPORATION
 
 
2005 NON-EMPLOYEE DIRECTORS LONG-TERM EQUITY INCENTIVE PLAN
 
 
(As Amended March 17, 2009 and March 16, 2010)
 

 
 

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ABRAXAS PETROLEUM CORPORATION
 
 
2005 NON-EMPLOYEE DIRECTORS LONG-TERM EQUITY INCENTIVE PLAN
 
 
TABLE OF CONTENTS
 
PART I
     
PURPOSE, ADMINISTRATION AND RESERVATION OF SHARES
1
 
SECTION 1.
Purpose of this Plan
1
 
SECTION 2.
Definitions
1
 
SECTION 3.
Administration of this Plan
4
 
SECTION 4.
Shares Subject to this Plan
5
 
SECTION 5.
Adjustments to Shares Subject to this Plan.
6
       
PART II
     
SPECIFIC TERMS APPLICABLE TO OPTIONS AND STOCK AWARDS
7
 
SECTION 6.
General Eligibility; Maximum Annual Participant
Award and Formula Awards.
7
 
SECTION 7.
Procedure for Exercise of Awards; Rights as a Stockholder.
7
 
SECTION 8.
Expiration of Awards.
8
 
SECTION 9.
Effect of Change of Control
9
       
PART III
     
SPECIFIC TERMS APPLICABLE TO OPTIONS AND STOCK AWARDS
9
 
SECTION 10.
Grant, Terms and Conditions of Options
9
 
SECTION 11.
Grant, Terms and Conditions of Stock Awards.
10
       
PART IV
     
TERM OF PLAN AND STOCKHOLDER APPROVAL
10
 
SECTION 12.
Term of Plan
10
 
SECTION 13.
Amendment and Termination of this Plan.
10
 
SECTION 14.
Stockholder Approval
11
       
PART V
     
MISCELLANEOUS
11
 
SECTION 15.
Unfunded Plan
11
 
SECTION 16.
Representations and Legends
11
 
SECTION 17.
Assignment of Benefits
12
 
SECTION 18.
Governing Laws
12
 
SECTION 19.
Application of Funds
12
 
SECTION 20.
Right of Removal
12

 

 

 
 

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ABRAXAS PETROLEUM CORPORATION
 
 
2005 Non-Employee Directors Long-Term Equity Incentive Plan
 
PART I
 

 
PURPOSE, ADMINISTRATION AND RESERVATION OF SHARES
 
SECTION 1.                      Purpose of this Plan. The purposes of this Plan
are (a) to attract and retain members of the Board of Directors, and (b) to
promote the growth and success of the Company’s business, (i) by aligning the
long-term interests of the Company’s Directors with those of the Company’s
stockholders by providing an opportunity to acquire an interest in the Company
and (ii) by providing both rewards for exceptional performance and long term
incentives for future contributions to the success of the Company and its
Subsidiaries.
 
 
This Plan permits the grant of Nonqualified Stock Options or Restricted Stock,
at the discretion of the Committee and as reflected in the terms of the Award
Agreement.  Each Award will be subject to conditions specified in this Plan.
 
SECTION 2.                      Definitions. As used herein, the following
definitions shall apply:
 
(a)           “Active Status” shall mean that the Director has not been removed
from the Board for cause by the Company’s stockholders as provided in the
Company’s Articles of Incorporation, as amended, and Bylaws, as amended.
 
(b)            “Award” shall mean any award or benefits granted under this Plan,
including Options and Restricted Stock.
 
(c)           “Award Agreement” shall mean a written or electronic agreement
between the Company and the Participant setting forth the terms of the Award.
 
(d)           “Beneficial Ownership” shall have the meaning set forth in
Rule 13d-3 promulgated under the Exchange Act.
 
(e)           “Board” shall mean the Company’s Board of Directors.
 
(f)           “Change of Control” shall mean the first day that any one or more
of the following conditions shall have been satisfied:
 
(i)           the sale, transfer, or assignment to, or other acquisition by any
other entity or entities, of all or substantially all of the Company’s assets
and business in one or a series of related transactions;
 
(ii)           a third person, including a “group” as determined in accordance
with Section 13(d) or 14(d) of the Exchange Act, obtains the Beneficial
Ownership of Common Stock having thirty percent (30%) or more of the then total
number of votes that may be cast for the election of members of the Board; or
 
 
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(iii)           a cash tender or exchange offer, merger, consolidation,
reorganization or other business combination, sale of assets or contested
election, or any combination of the foregoing transactions (each a
“Transaction”) in connection with the Company, as a result of which the persons
who are then members of the Board before the Transaction shall cease to
constitute a majority of the Board of the Company or any successor to the
Company after the Transaction.
 
(g)           “Code” shall mean the Internal Revenue Code of 1986, as amended.
 
(h)           “Committee” shall mean the Compensation Committee appointed by the
Board.
 
(i)           “Common Stock” shall mean the common stock of the Company, par
value $0.01 per share.
 
(j)           “Company” shall mean Abraxas Petroleum Corporation, a Nevada
corporation, and any successor thereto.
 
(k)           “Director” shall mean a member of the Board and, except with
respect to the ability to vote on any issues before the Board or the delegation
of authority from the Board, shall also be deemed to include advisory directors.
 
(l)           “Effective Date” shall mean the date on which the Company’s
stockholders have approved this Plan in accordance with applicable NASDAQ rules.
 
(m)           “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended.
 
(n)           “Fair Market Value” shall mean the closing price per share of the
Common Stock on the NASDAQ as to the date specified (or the previous trading day
if the date specified is a day on which no trading occurred), or if NASDAQ shall
cease to be the principal exchange or quotation system upon which the shares of
Common Stock are listed or quoted, then such exchange or quotation system upon
which the Company elects to list or quote its shares of Common Stock.
 
(o)           “FLSA” shall mean the Fair Labor Standards Act of 1938, as
amended.
 
(p)           “Independent Director” shall mean a Director who: (i) meets the
independence requirements of the NASDAQ, or if the NASDAQ shall cease to be the
principal exchange or quotation system upon which the shares of Common Stock are
listed or quoted, then such exchange or quotation system upon which the Company
elects to list or quote its shares of Common Stock; (ii) qualifies as an
“outside director” under Section 162(m) of the Code; (iii) qualifies as a
“non-employee director” under Rule 16b-3 promulgated under the Exchange Act; and
(iv) satisfies independence criteria under any other applicable laws or
regulations relating to the issuance of Shares to Non-Employee Directors.
 
 
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(q)           “Maximum Annual Participant Award” shall have the meaning set
forth in Section 6(b).
 
(r)           “Misconduct” shall mean the removal from the Board for cause.
 
(s)           “NASDAQ” shall mean the NASDAQ Capital Market.
 
(t)           “Nominating and Corporate Governance Committee” shall mean the
Nominating and Corporate Governance Committee appointed by the Board.
 
(u)           “Non-Employee Director” shall mean a Director who is not a common
law employee of the Company or any Subsidiary of the Company.
 
(v)           “Option” shall mean a stock option granted pursuant to Section 10
of this Plan.
 
(w)           “Optionee” shall mean a Participant who has been granted an
Option.
 
(x)           “Participant” shall mean any Non-Employee Director granted an
Award.
 
(y)           “Plan” shall mean this Abraxas Petroleum Corporation 2005
Non-Employee Directors Long-Term Equity Incentive Plan, including any amendments
thereto.
 
(z)           “Reprice” shall mean the adjustment or amendment of the exercise
price of Options or previously awarded whether through amendment, cancellation,
replacement of grants or any other means.
 
(aa)           “Restricted Stock” shall mean a grant of Shares pursuant to
Section 11 of this Plan.
 
(bb)           “Retirement” shall mean ceasing to be a Director pursuant to
election by the Company’s stockholders or by voluntary resignation with the
approval of the Board’s chair after having served continuously on the Board for
at least six years.
 
(cc)           “SEC” shall mean the Securities and Exchange Commission.
 
(dd)           “Share” shall mean one share of Common Stock, as adjusted in
accordance with Section 5 of this Plan.
 
(ee)           “Subcommittee” shall have the meaning set forth in Section 3(d).
 
(ff)           “Subsidiary” shall mean a “subsidiary corporation,” whether now
or hereafter existing, as defined in Section 424(f) of the Code, a limited
liability company, partnership or other entity in which the Company controls
fifty percent (50%) or more of the voting power or equity interests, or an
entity with respect to which the Company possesses the power, directly or
indirectly, to direct or cause the direction of the management and policies of
that entity, whether through the Company’s ownership of voting securities, by
contract or otherwise.
 
 
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SECTION 3.                       Administration of this Plan.
 
(a)           Authority.  This Plan shall be administered by the Committee.  The
Committee shall have full and exclusive power to administer this Plan on behalf
of the Board,
 
subject to such terms and conditions as the Committee may
prescribe.  Notwithstanding anything herein to the contrary, the Committee’s
power to administer this Plan, and actions the Committee takes under this Plan,
shall be limited by the provisions set forth in the Committee’s charter, as such
charter may be amended from time to time, and the further limitation that
certain actions may be subject to review and approval by either the full Board
or a panel consisting of all of the Independent Directors of the Company.
 
(b)           Powers of the
Committee.                                           Subject to the other
provisions of this Plan, the Committee shall have the authority, in its
discretion:
 
(i)           to determine the Participants, to whom Awards, if any, will be
granted hereunder;
 
(ii)           to grant Options and Restricted Stock to Participants and to
determine the terms and conditions of such Awards, including the determination
of the Fair Market Value of the Shares, the number of Shares to be represented
by each Award and the vesting schedule, the exercise price, the timing of such
Awards, and to modify or amend each Award, with the consent of the Participant
when required;
 
(iii)           to construe and interpret this Plan and the Awards granted
hereunder;
 
(iv)           to prescribe, amend, and rescind rules and regulations relating
to this Plan, including the form of Award Agreement, and manner of acceptance of
an Award, such as correcting a defect or supplying any omission, or reconciling
any inconsistency so that this Plan or any Award Agreement complies with
applicable law, regulations and listing requirements and to avoid unanticipated
consequences deemed by the Committee to be inconsistent with the purposes of
this Plan or any Award Agreement;
 
(v)           to accelerate or defer (with the consent of the Participant) the
exercise or vested date of any Award;
 
(vi)           to authorize any person to execute on behalf of the Company any
instrument required to effectuate the grant of an Award previously granted by
the Committee; and
 
(vii)           to make all other determinations deemed necessary or advisable
for the administration of this Plan;
 
 
provided, that, no consent of a Participant is necessary under clauses (i) or
(v) if a modification, amendment, acceleration, or deferral, in the reasonable
judgment of the Committee confers a benefit on the Participant or is made
pursuant to an adjustment in accordance with Section 5.
 

 
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    (c)            Effect of Committee’s Decision. All decisions,
determinations, and interpretations of the Committee shall be final and binding
on all Participants, the Company (including its Subsidiaries), any stockholder
and all other persons.
 
(d)           Delegation. Consistent with the Committee’s charter, as such
charter may be amended from time to time, the Committee may delegate its
authority and duties under this Plan to one or more separate committees
consisting of members of the Committee or other Directors who are Independent
Directors (any such committee a “Subcommittee”), and such actions shall be
treated for all purposes as if taken by the Committee; provided that the grant
of Awards shall be made in accordance with parameters established by the
Committee.  Any action by any such Subcommittee within the scope of such
delegation shall be deemed for all purposes to have been taken by the Committee.
 
SECTION 4.                       Shares Subject to this Plan.
 
(a)           Reservation of Shares. The shares of Common Stock reserved under
this Plan shall be 1,500,000 shares of Common Stock.  If an Award expires, is
forfeited or becomes unexercisable for any reason without having been exercised
in full, the undelivered Shares which were subject thereto shall, unless this
Plan shall have been terminated, become available for future Awards under this
Plan.  Without limiting the foregoing, unless this Plan shall have been
terminated, Shares underlying an Award that has been exercised, either in part
or in full, including any Shares that would otherwise be issued to a Participant
that are used to satisfy any withholding tax obligations that arise with respect
to any Award, shall become available for future Awards under this Plan except to
the extent Shares were issued in settlement of the Award.  The Shares may be
authorized but unissued, or reacquired shares of Common Stock.  The Company,
during the term of this Plan, will at all times reserve and keep available such
number of Shares as shall be sufficient to satisfy the requirements of this
Plan.
 
(b)           Time of Granting Awards. The date of grant of an Award shall, for
all purposes, be the date on which the Company completes the corporate action
relating to the grant of such Award and all conditions to the grant have been
satisfied, provided that conditions to the exercise of an Award shall not defer
the date of grant.  Notice of a grant shall be given to each Participant to whom
an Award is so granted within a reasonable time after the determination has been
made.
 
(c)           Securities Law Compliance. Shares shall not be issued pursuant to
the exercise of an Award unless the exercise of such Award and the issuance and
delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated under either
such Acts, and the requirements of any stock exchange or quotation system upon
which the Shares may then be listed or quoted, and shall be further subject to
the approval of counsel for the Company with respect to such compliance.
 
 
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(d)           Substitutions and Assumptions. The Board or the Committee shall
have the right to substitute or assume Awards in connection with mergers,
reorganizations, separations, or other transactions to which Section 424(a) of
the Code applies, provided such substitutions and assumptions are permitted by
Section 424 of the Code and the regulations promulgated thereunder.  The number
of Shares reserved pursuant to Section 4(a) may be increased by the
corresponding number of Awards assumed and, in the case of a substitution, by
the net increase in the number of Shares subject to Awards before and after the
substitution.
 
SECTION 5.                       Adjustments to Shares Subject to this Plan.
 
(a)           Adjustments.  If the outstanding shares of Common Stock shall be
changed into or exchanged for a different number or kind of shares of stock or
other securities or property of the Company or of another corporation (whether
by reason of merger, consolidation, recapitalization, reclassification, split
up, combination of shares or otherwise), or if the number of such shares of
Common Stock shall be increased by a stock dividend or stock split, there shall
be substituted for or added to each share of Common Stock theretofore reserved
for the purposes of this Plan, whether or not such shares are at the time
subject to outstanding Awards, the number and kind of shares of stock or other
securities or property into which each outstanding share of Common Stock shall
be so changed or for which it shall be so exchanged, or to which each such share
shall be entitled, as the case may be.  Outstanding Awards shall also be
considered to be appropriately amended as to price and other terms as may be
necessary or appropriate to reflect the foregoing events.  If there shall be any
other change in the number or kind of the outstanding shares of Common Stock, or
of any stock or other securities or property into which such Common Stock shall
have been changed, or for which it shall have been exchanged, and if the
Committee shall in its sole discretion determine that such change equitably
requires an adjustment in the number or kind or price of the shares then
reserved for the purposes of this Plan, or in any Award theretofore granted or
which may be granted under this Plan, then such adjustment shall be made by the
Committee and shall be effective and binding for all purposes of the Plan.  In
making any such substitution or adjustment pursuant to this Section 5,
fractional shares may be ignored.
 
(b)           Amendments.  The Committee shall have the power, in the event of
any merger or consolidation of the Company with or into any other corporation,
or the merger or consolidation of any other corporation with or into the
Company, to amend all outstanding Awards to permit the exercise thereof in whole
or in part at anytime, or from time to time, prior to the effective date of any
such merger or consolidation and to terminate each such Award as of such
effective date.
 
(c)           No Other Adjustment.  Except as expressly provided herein, no
issuance by the Company of shares of any class, or securities convertible into
shares of any class, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares subject to an Award.
 
 
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PART II
 

 
TERMS APPLICABLE TO ALL AWARDS
 
SECTION 6.                       General Eligibility; Maximum Annual Participant
Award and Formula Awards.
 
        (a)           Awards. Awards may be granted only to Participants who are
Non-Employee Directors.
 
(b)           Maximum Annual Participant Award. The aggregate number of Shares
with respect to which an Award or Awards may be granted to any one Participant
in any one taxable year of the Company (the “Maximum Annual Participant Award”)
shall not exceed 100,000 shares of Common Stock (subject to adjustment as set
forth in Section 5(a)) pursuant to the Awards to be granted pursuant to Section
6(c) and Section 6(d).
 
(c)           Formula Awards.  Each year at the first regular meeting of the
Board of Directors immediately following the Company’s annual stockholders
meeting for that year, each Non-Employee Director at the time of such Board
meeting, shall be granted Awards of 10,000 shares of Common Stock (subject to
adjustment as set forth in Section 5(a)), unless the Committee shall decide
otherwise prior to or at such Board meeting.  The Awards granted pursuant to
this Section 6(c) are intended to compensate each Non-Employee Director for that
Non-Employee Director’s participation in Board and Committee meetings during the
Company’s previous calendar year.  Any Non-Employee Director who leaves the
Board (including ceasing to be an advisory Director) prior to the date of the
first regular meeting of the Board of Directors shall not be entitled to any
Awards under this Section 6(c).
 
(d)           Other Director Awards. For Non-Employee Directors who are
appointed to the Board after the Effective Date of the Plan, the Board may grant
an Award to the Non-Employee Director and the terms and conditions of that grant
shall be determined by the Committee.  In addition, at any other time, the Board
may grant an Award to a Non-Employee Director and the terms and conditions of
that grant shall be determined by the Committee.  The Awards granted pursuant to
this Section 6(d) are intended to compensate each Non-Employee Director for that
Non-Employee Director’s commitment to the Board of Directors by aligning the
long-term interests of the Company’s Directors with those of the Company’s
stockholders.
 
SECTION 7.                       Procedure for Exercise of Awards; Rights as a
Stockholder.
 
(a)           Procedure. An Award shall be exercised when written, electronic or
verbal notice of exercise has been given to the Company, or the brokerage firm
or firms approved by the Company to facilitate exercises and sales under this
Plan, in accordance with the terms of the Award by the person entitled to
exercise the Award and full payment for the Shares with respect to which the
Award is exercised has been received by the Company or the brokerage firm or
firms, as applicable.  The notification to the brokerage firm shall be made in
accordance with procedures of such brokerage firm approved by the Company.  Full
payment may, as authorized by the Committee, consist of any consideration and
method of payment allowable under Section 7(b) of this Plan.  The Company shall
issue (or
 
 
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cause to be issued) such share certificate promptly upon exercise of the
Award.  No adjustment will be made for a dividend or other right for which the
record date is prior to the date the share certificate is issued, except as
provided in Section 5 of this Plan.
 
(b)           Method of Payment. The consideration to be paid for any Shares to
be issued upon exercise or other required settlement of an Award, including the
method of payment, shall be determined by the Committee at the time of
settlement and which forms may include (without limitation): (i) with respect to
an Option, a request that the Company or the designated brokerage firm conduct a
cashless exercise of the Option; (ii) cash; and (iii) tender of shares of Common
Stock owned by the Participant in accordance with rules established by the
Committee from time to time.  Shares used to pay the exercise price shall be
valued at their Fair Market Value on the exercise date.  Payment of the
aggregate exercise price by means of tendering previously-owned shares of Common
Stock shall not be permitted when the same may, in the reasonable opinion of the
Company, cause the Company to record a loss or expense as a result thereof.
 
(c)           Withholding Obligations.  To the extent required by applicable
federal, state, local or foreign law, the Committee may and/or a Participant
shall make arrangements satisfactory to the Company for the satisfaction of any
withholding tax obligations that arise with respect to any Option or Restricted
Stock or any sale of Shares.  The Company shall not be required to issue Shares
or to recognize the disposition of such Shares until such obligations are
satisfied.  These obligations may be satisfied by having the Company withhold a
portion of the Shares that otherwise would be issued to a Participant under such
Award or by tendering Shares previously acquired by the Participant in
accordance with rules established by the Committee from time to time.
 
(d)           Stockholder Rights. Except as otherwise provided in this Plan,
until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the share
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Shares subject to
the Award, notwithstanding the exercise of the Award.
 
(e)           Non-Transferability of Awards. An Award may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in exchange for
consideration, except that an Award may be transferred by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Participant, only by the Participant; unless the Committee permits further
transferability, on a general or specific basis, in which case the Committee may
impose conditions and limitations on any permitted transferability.
 
SECTION 8.                       Expiration of Awards.
 
(a)           Expiration, Termination or Forfeiture of Awards. Unless otherwise
provided in the applicable Award Agreement or any severance agreement, vested
Awards granted under this Plan shall expire, terminate, or otherwise be
forfeited as follows:
 
 
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(i)           three (3) months after the date the Company delivers a notice of
termination of a Participant’s Active Status, other than in circumstances
covered by (ii), (iii) or (iv) below;
 
(ii)           immediately upon termination of a Participant’s Active Status for
Misconduct;
 
(iii)           twelve (12) months after the date of the death of a Participant
whose Active Status terminated as a result of his or her death; and
 

(iv)           thirty-six (36) months after the date on which the Participant
ceased performing services as a result of Retirement.
 
(b)           Extension of Term. Notwithstanding subsection (a) above, the
Committee shall have the authority to extend the expiration date of any
outstanding Option in circumstances in which it deems such action to be
appropriate (provided that no such extension shall extend the term of an Option
beyond the date on which the Option would have expired if no termination of the
Participant’s Active Status had occurred).
 
SECTION 9.                       Effect of Change of Control. Notwithstanding
any other provision in this Plan to the contrary, the following provisions shall
apply unless otherwise provided in the most recently executed agreement between
the Participant and the Company, or specifically prohibited under applicable
laws, or by the rules and regulations of any applicable governmental agencies or
national securities exchanges or quotation systems.
 
(a)           Acceleration. Awards of a Participant shall be Accelerated (as
defined in Section 9(b)) upon the occurrence of a Change of Control.
 
(b)           Definition. For purposes of this Section 9, Awards of a
Participant being “Accelerated” means, with respect to such Participant:
 
(i)           any and all Options shall become fully vested and immediately
exercisable, and shall remain exercisable throughout their entire term; and
 
(ii)           any restriction periods and restrictions imposed on Restricted
Stock shall lapse.
 
PART III
 

 
SPECIFIC TERMS APPLICABLE TO OPTIONS AND STOCK AWARDS
 
SECTION 10.                       Grant, Terms and Conditions of Options.
 
(a)           Term of Options. The term of Options shall be at the discretion of
the Committee.
 
(b)           Option Exercise Prices. The per Share exercise price under an
Option shall be no less than one hundred percent (100%) of the Fair Market Value
per Share on the date of grant.  In no event shall the Board or the Committee be
permitted to Reprice an Option after the date of grant without stockholder
approval.
 
 
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(c)           Vesting. Options granted pursuant to this section 10 shall vest
pursuant to the periods, terms and conditions determined by the Committee in its
sole discretion.  To the extent Options vest and become exercisable in
increments, such Options shall cease vesting as of the termination of such
Optionee’s Active Status for reasons other than Retirement or death, in each of
which cases such Options shall immediately vest in full.
 
         (d)           Exercise. Any Option granted hereunder shall be
exercisable at such times and under such conditions as determined by the
Committee at the time of grant, and as are permissible under the terms of this
Plan.  An Option may not be exercised for a fraction of a Share.
 
SECTION 11.                       Grant, Terms and Conditions of Stock Awards.
 
(a)           Designation. Restricted Stock may be granted either alone, in
addition to, or in tandem with other Awards granted under this Plan.  After the
Committee determines that it will offer Restricted Stock, it will advise the
Participant in writing or electronically, by means of an Award Agreement, of the
terms, conditions and restrictions, including vesting, if any, related to the
offer, including the number of Shares that the Participant shall be entitled to
receive or purchase, the price to be paid, if any, and, if applicable, the time
within which the Participant must accept the offer.  The offer shall be accepted
by execution of an Award Agreement or as otherwise directed by the
Committee.  The term of each award of Restricted Stock shall be at the
discretion of the Committee.
 
(b)           Vesting.   The Committee shall determine the time or times within
which an Award of shares of Restricted Stock may be subject to forfeiture, the
vesting schedule and the rights to acceleration thereof, and all other terms and
conditions of the Award.  Subject to the applicable provisions of the Award
Agreement and this Section 11, upon termination of a Participant’s Active Status
for any reason, all Restricted Stock subject to the Award Agreement may vest or
be forfeited in accordance with the terms and conditions established by the
Committee as specified in the Award Agreement.
 
PART IV
 

 
TERM OF PLAN AND STOCKHOLDER APPROVAL
 
SECTION 12.                       Term of Plan. This Plan shall become effective
as of the Effective Date.  It shall continue in effect until the tenth
anniversary of the Effective Date or until terminated under Section 14 of this
Plan or extended by an amendment approved by the stockholders of the Company
pursuant to Section 14(a).
 
SECTION 13.                       Amendment and Termination of this Plan.
 
(a)           Amendment and Termination. The Board or the Committee may amend or
terminate this Plan from time to time in such respects as the Board may deem
advisable (including, but not limited, to amendments which the Board deems
appropriate to enhance the Company’s ability to claim deductions related to
stock option exercises); provided, that to the extent required by the Code or
the
 
 
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rules of the NASDAQ, such other exchange upon which the Company’s Common Stock
is either quoted or traded, or the SEC, stockholder approval shall be required
for any material amendment of this Plan.  Subject to the foregoing, it is
specifically intended that the Board or Committee may amend this Plan without
stockholder approval to comply with legal, regulatory and listing requirements
and to avoid unanticipated consequences deemed by the Committee to be
inconsistent with the purpose of this Plan or any Award Agreement.

(b)           Effect of Amendment or Termination. Any amendment or termination
of this Plan shall not affect Awards already granted and such Awards shall
remain in full force and effect as if this Plan had not been amended or
terminated, unless mutually agreed otherwise between the Participant and the
Committee, which agreement must be in writing and signed by the Participant and
the Company.
 
SECTION 14.                       Stockholder Approval. The effectiveness of
this Plan is subject to approval by the stockholders of the Company in
accordance with applicable NASDAQ rules.
 
PART V
 
MISCELLANEOUS
 
SECTION 15.                       Unfunded Plan.  The adoption of this Plan and
any setting aside of amounts by the Company with which to discharge its
obligations hereunder shall not be deemed to create a trust.  The benefits
provided under this Plan shall be a general, unsecured obligation of the Company
payable solely from the general assets of the Company, and neither a Participant
nor the Participant’s beneficiaries or estate shall have any interest in any
assets of the Company by virtue of this Plan.  Nothing in this Section 15 shall
be construed to prevent the Company from implementing or setting aside funds in
a grantor trust subject to the claims of the Company’s creditors.  Legal and
equitable title to any funds set aside, other than any grantor trust subject to
the claims of the Company’s creditors, shall remain in the Company and any funds
so set aside shall remain subject to the general creditors of the Company,
present and future.  Any liability of the Company to any Participant with
respect to an Award shall be based solely upon contractual obligations created
by this Plan and the Award Agreements.
 
SECTION 16.                       Representations and Legends.  The Committee
may require each person purchasing shares pursuant to an Award under this Plan
to represent to and agree with the Company in writing that the purchaser is
acquiring the shares without a view to distribution thereof.  In addition to any
legend required by this Plan, the certificate for such shares may include any
legend which the Committee deems appropriate to reflect a restriction on
transfer.
 
All certificates for shares of Common Stock delivered under this Plan shall be
subject to such stock transfer orders and other restrictions as the Committee
may deem advisable under the rules, regulations and other requirements of the
SEC, any stock exchange upon which the Common Stock is listed, applicable
federal or state securities laws, and any applicable corporate law, and the
Committee may cause the legend or legends to be put on any such certificates to
make appropriate reference to such restriction.
 
 
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SECTION 17.                       Assignment of Benefits.  No Award or other
benefits payable under this Plan shall, except as otherwise provided under this
Plan or as specifically provided by law, be subject in any manner to
anticipation, alienation, attachment, sale, transfer, assignment, pledge,
encumbrance or charge.  Any attempt to anticipate, alienate, attach, sell,
transfer, assign, pledge, encumber or charge, any such benefit shall be void,
and any such benefit shall not in any manner be subject to the debts, contracts,
liabilities, engagements or torts of any person who shall be entitled to such
benefit, nor shall such benefit be subject to attachment or legal process for or
against that person.
 
SECTION 18.                                Governing Laws.  This Plan and
actions taken in connection herewith shall be governed, construed and enforced
in accordance with the laws of the State of Nevada.
 
SECTION 19.                       Application of Funds.  The proceeds received
by the Company from the sale of shares of Common Stock pursuant to Awards
granted under this Plan will be used for general corporate purposes.
 
SECTION 20.                       Right of Removal.  Nothing in this Plan or in
any Award or Award Agreement shall confer upon any Non-Employee Director or any
other individual the right to continue as a Director of the Company, or affect
any right the Company or the Company’s stockholders may have to remove the
Non-Employee Director as a Director at any time for any reason.
 

 

 
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