Exhibit 4.1



 





Exhibit 4.1




[1997 Stock Compensation Program]




 









 








HOLL TECHNOLOGIES COMPANY

1997 STOCK COMPENSATION PROGRAM




     
     1. Purpose. This Holl Technologies Company 1997 Stock
Compensation Program (the “Program”) is intended to secure for Holl Technologies Company (the “Company”) and its
subsidiaries, if any, and its stockholders the benefits arising from ownership of the Company’s
common stock (the “Common Stock”) by those selected key individuals of the Company and its
subsidiaries, if any, who will be responsible for the future growth of such corporations. The
Program is designed to help attract and retain superior personnel for positions of substantial
responsibility with the Company and its subsidiaries, if any, and to provide key individuals with
an additional incentive to contribute to the success of the corporations. Nothing contained herein
shall be construed to amend or terminate any existing options granted by the Company.




          2. Elements of the Program. In order to maintain flexibility in the award of stock
benefits, the Program is composed of seven parts. The first part is the Incentive Stock Option Plan
(the “Incentive Plan”) under which are granted incentive stock options (the “Incentive Options”).
The second part is the Compensatory Stock Option Plan (the “Nonqualified Plan”) under which are
granted nonqualified stock options (the “Nonqualified Options”). The third part is the Restricted
Shares Plan (the “Restricted Plan”) under which are granted restricted shares of Common Stock. The
fourth part is the Employee Stock Purchase Plan (the “Stock Purchase Plan”). The fifth part is the
Non-Employee Director Stock Option Plan (the “Directors Plan”) under which grants of options to
purchase shares of Common Stock may be made to non-employee directors of the Company. The sixth
part is the Stock Appreciation Rights Plan (the “SAR Plan”) under which SARs (as defined therein)
are granted. The seventh part is the Other Stock Rights Plan (the “Stock Rights Plan”) under which
(i) units representing the equivalent of shares of Common Stock (the “Performance Shares”) are
granted; (ii) payments of compensation in the form of shares of Common Stock pursuant to Section 6
of the Stock Rights Plan (the “Stock Payments”) are granted; and (iii) rights pursuant to Section 7
of the Stock Rights Plan to receive cash or shares of Common Stock based on the value of dividends
paid with respect to a share of Common Stock (the “Dividend Equivalent Rights” ) are granted. The
Incentive Plan, the Nonqualified Plan, the Restricted Plan, the Stock Purchase Plan, the Directors
Plan, the SAR Plan and the Stock Rights Plan are included herein as Part I, Part II, Part III, Part
IV, Part V, Part VI, and Part VII, respectively, and are collectively referred to herein as the
“Plans”. The grant of an option, SAR, or restricted share or rights to purchase shares under one of
the Plans shall not be construed to prohibit the grant of an option, SAR or restricted share or
rights to purchase shares under any of the other Plans.




          3. Applicability of General Provisions. Unless any Plan specifically indicates to
the contrary, all Plans shall be subject to the General Provisions of the Holl Technologies Company
Stock Compensation Program set forth below.




          4. Administration of the Plans. The Plans shall be administered, construed, governed,
and amended in accordance with their respective terms.




GENERAL PROVISIONS OF STOCK COMPENSATION PROGRAM




          Article 1. Administration. The Program shall be administered by the Company’s Board of
Directors (the “Board”) or by a committee appointed by the Board after the Company has been
registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), consisting
of not less than two directors who are “Non-Employee Directors” within the meaning of Rule 16b-3
promulgated pursuant to the




 









 









Exchange Act. Subject to the foregoing limitations, as applicable, the Board may from time to time
remove members from the committee, fill all vacancies on the committee, however caused, and may
select one of the members of the committee as its Chairman. The members of the Board or committee,
when acting to administer the Program, are herein collectively referred to as the “Program
Administrators.”




          The Program Administrators shall hold meetings at such times and places as they may determine
and as necessary to approve all grants and other transactions under the Program as required under
Rule 16b-3(d) of the Exchange Act, shall keep minutes of their meetings, and shall adopt, amend,
and revoke such rules and procedures as they may deem proper with respect to the Program. Any
action of the Program Administrators shall be taken by majority vote or the unanimous written
consent of the Program Administrators.




          Article 2. Authority of Program Administrators. Subject to the other provisions of
this Program, and with a view to effecting its purpose, the Program Administrators shall have sole
authority, in their absolute discretion, (a) to construe and interpret the Program; (b) to define
the terms used herein; (c) to determine the individuals to whom options and restricted shares and
rights to purchase shares shall be granted under the Program; (d) to determine the time or times at
which options and restricted shares or rights to purchase shares shall be granted under the
Program; (e) to determine the number of shares subject to each option, restricted share and
purchase right, the option price, the duration of each option granted under the Program, and the
price of any share purchase; (f) to determine all of the other terms and conditions of options and
restricted shares and purchase rights granted under the Program; and (g) to make all other
determinations necessary or advisable for the administration of the Program and to do everything
necessary or appropriate to administer the Program. All decisions, determinations, and
interpretations made by the Program Administrators shall be binding and conclusive on all
participants in the Program (the “Plan Participants”) and on their legal representatives, heirs,
and beneficiaries.




          Article 3. Maximum Number of Shares Subject to the Program. The maximum aggregate
number of shares of Common Stock subject to the Plans shall be 750,000 shares. The shares of Common
Stock to be issued upon exercise of an option, to the extent exercised for shares of Common Stock,
issued as restricted shares or issued upon stock purchases may be authorized but unissued shares,
shares issued and reacquired by the Company or shares purchased by the Company on the open market.
If any of the options granted under the Program expire or terminate for any reason before they have
been exercised in full, the unpurchased shares subject to those expired or terminated options shall
cease to reduce the number of shares available for purposes of the Program. If the conditions
associated with the grant of restricted shares are not achieved within the period specified for
satisfaction of the applicable conditions, or if the restricted share grant terminates for any
reason before the date on which the conditions must be satisfied, the shares of Common Stock
associated with such restricted shares shall cease to reduce the number of shares available for
purposes of the Program.




          The proceeds received by the Company from the sale of its Common Stock pursuant to the
exercise of options, transfer of restricted shares or issuance of stock purchased under the
Program, if in the form of cash, shall be added to the Company’s general funds and used for general
corporate purposes.




          Article 4. Eligibility and Participation. Officers, key employees, directors
(whether employee directors or nonemployee directors), and independent contractors or agents of the
Company or its subsidiaries who are responsible for or contribute to the management, growth, or profitability of the business
of the Company or its subsidiaries shall be eligible for selection by the Program Administrators to participate
in the Program. However, Incentive Options may be granted under the Incentive Plan only to a person who




          


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is an employee of the Company or its subsidiaries. An employee may be granted Nonqualified Options
under the Program; provided, however, that the grant of Nonqualified Options and Incentive Options
to an employee shall be the grant of separate options and each Nonqualified Option and each
Incentive Option shall be specifically designated as such in accordance with applicable provisions
of the Treasury Regulations.




          The term “subsidiary” as used herein means any Company, other than the Company, in an unbroken
chain of Companies, beginning with the Company if, at the time of any grant hereunder, each of the
companies , other than the last company in the unbroken chain, owns stock possessing more than 50%
of the total combined voting power of all classes of stock in one of the other companies in such
chain.




          Article 5. Effective Date and Term of Program. The Restricted Plan , the Nonqulaified
Plan and the Directors Plan shall become effective upon their adoption by the Board of Directors of
the Company or the Program Administrators. The Incentive Plan and the Stock Purchase Plan shall
become effective upon their adoption by the Board of Directors of the Company or the Program
Administrators subject to approval of the Program by a majority of the stockholders of the Company
voting in person or by proxy at a meeting of stockholders following adoption of the Program by the
Board of Directors, which vote shall be taken within 12 months of adoption of the Program by the
Company’s Board of Directors. The Program shall continue in effect for a term of 10 years unless
sooner terminated under Article 7 of these General Provisions.




          Article 6. Adjustments. If the outstanding shares of Common Stock are increased,
decreased, changed into, or exchanged for a different number or kind of shares or securities
through merger, consolidation, combination, exchange of shares, other reorganization,
recapitalization, reclassification, stock dividend, stock split or reverse stock split, an
appropriate and proportionate adjustment shall be made in the maximum number and kind of shares as
to which options and restricted shares may be granted under this Program. A corresponding
adjustment changing the number and kind of shares allocated to unexercised options, restricted
shares, or portions thereof, which shall have been granted prior to any such change, shall likewise
be made. Any such adjustment in outstanding options shall be made without change in the aggregate
purchase price applicable to the unexercised portion of the option, but with a corresponding
adjustment in the price for each share or other unit of any security covered by the option.




          Article 7. Termination and Amendment of Program. The Program shall terminate 10 years
from the date such program is adopted by the Board of Directors, or the date such program is
approved by the stockholders, whichever is earlier, or shall terminate at such earlier time as the
Board of Directors may so determine. No options or restricted shares shall be granted and no stock
shall be sold and purchased under the Program after that date. Subject to the limitation contained
in Article 8 of these General Provisions, the Program Administrators may at any time amend or
revise the terms of the Program, including the form and substance of the option, restricted share
and stock purchase agreements to be used hereunder; provided, however, that without approval by the
stockholders of the Company representing a majority of the voting power (as contained in Article 5
of these General Provisions) no amendment or revision shall (a) increase the maximum aggregate
number of shares that may be sold or distributed pursuant to options or restricted shares granted
or stock sold and purchased under this Program, except as permitted under Article 6 of these
General Provisions; (b) change the minimum purchase price for
shares under Section 4 of Plans I and
II or the Purchase Price for shares under Plan IV; (c) increase the maximum term established under the Plans for any
option or restricted share; (d) permit the granting of an option, restricted share or right to purchase shares
to anyone other than as provided in Article 4 of the General Provisions; (e) change the term of the Program
described in Article 5 of these General Provisions; or (f) materially increase the benefits accruing to Plan
Participants under the Program.




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          Article 8. Prior Rights and Obligations. No amendment, suspension, or termination of
the Program shall, without the consent of the individual who has received an option or restricted
share or who has purchased a specified share or shares under Plan IV, alter or impair any of that
person’s rights or obligations under any option or restricted share granted or shares sold and
purchased under the Program prior to that amendment, suspension, or termination.




          Article 9. Privileges of Stock Ownership. Notwithstanding the exercise of any option
granted pursuant to the terms of this Program, the achievement of any conditions specified in any
restricted share granted pursuant to the terms of this Program or the election to purchase any
shares pursuant to the terms of this Program, no individual shall have any of the rights or
privileges of a stockholder of the Company in respect of any shares of stock issuable upon the
exercise of his or her option, the satisfaction of his or her restricted share conditions or the
sale, purchase and issuance of such purchased shares until certificates representing the shares
have been issued and delivered. No shares shall be required to be issued and delivered upon
exercise of any option, satisfaction of any conditions with respect to a restricted share or a
purchaser under Plan IV unless and until all of the requirements of law and of all regulatory
agencies having jurisdiction over the issuance and delivery of the securities shall have been fully
complied with.




          Article 10. Reservation of Shares of Common Stock. The Company, during the term of
this Program, will at all times reserve and keep available such number of shares of its Common
Stock as shall be sufficient to satisfy the requirements of the Program. In addition, the Company
will from time to time, as is necessary to accomplish the purposes of this Program, seek or obtain
from any regulatory agency having jurisdiction any requisite authority in order to issue and sell
shares of Common Stock hereunder. The inability of the Company to obtain from any regulatory
agency having jurisdiction the authority deemed by the Company’s counsel to be necessary to the
lawful issuance and sale of any shares of its stock hereunder shall relieve the Company of any
liability in respect of the nonissuance or sale of the stock as to which the requisite authority
shall not have been obtained.




          Article 11. Tax Withholding. The exercise of any option or restricted share granted or
the sale and issuance of any shares to be purchased under this Program are subject to the condition
that if at any time the Company shall determine, in its discretion, that the satisfaction of
withholding tax or other withholding liabilities under any state or federal law is necessary or
desirable as a condition of, or in connection with, such exercise or the delivery or purchase of
shares pursuant thereto, then in such event, the exercise of the option or restricted share or the
sale and issuance of any shares to be purchased shall not be effective unless such withholding
shall have been effected or obtained in a manner acceptable to the Company. At the Company’s sole
and complete discretion, the Company may, from time to time, accept shares of the Company’s stock
subject to one of the Plans as the source of payment for such liabilities.




          Article 12. Rule 16b-3 Compliance. It is the express intent of the Company that this
Program comply in all respects with applicable provisions of the Rule 16b-3 or Rule 16a-1(c)(3)
under the Exchange Act in connection with any grant of awards to, or other transaction by, a Plan
Participant who is subject to Section 16 of the Exchange Act (except for transactions exempted
under alternative Exchange Act Rules). Accordingly, if any provision of the Program or any
agreement relating to any award thereunder does not comply with Rule 16b-3 or Rule 16a-1(c)(3) as
then applicable to any such transaction, such provision will be construed or deemed amended to the extent necessary to conform to the applicable requirements of
Rule 16b-3 or Rule 16a-1(c)(3) so that such Plan Participant shall avoid liability under Section 16(b).




PLAN I





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HOLL TECHNOLOGIES COMPANY

INCENTIVE STOCK OPTION PLAN




          Section 1. Purpose. The purpose of this Holl Technologies Company Incentive Stock
Option Plan (the “Incentive Plan”) is to promote the growth and general prosperity of the Company
by permitting the Company to grant options to purchase shares of its Common Stock. The Incentive
Plan is designed to help attract and retain superior personnel for positions of substantial
responsibility with the Company and its subsidiaries, and to provide key individuals with an
additional incentive to contribute to the success of the Company. The Company intends that options
granted pursuant to the provisions of the Incentive Plan will qualify as “incentive stock options”
within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).
This Incentive Plan is Part I of the Program. Unless any provision herein indicates to the
contrary, this Incentive Plan shall be subject to the General Provisions of the Program.




          Section 2. Option Terms and Conditions. The terms and conditions of options granted
under the Incentive Plan may differ from one another as the Program Administrators shall, in their
discretion, determine as long as all options granted under the Incentive Plan satisfy the
requirements of the Incentive Plan.




          Section 3. Duration of Options. Each option and all rights thereunder granted pursuant
to the terms of the Incentive Plan shall expire on the date determined by the Program
Administrators, but in no event shall any option granted under the Incentive Plan expire later than
ten (10) years from the date on which the option is granted. However, notwithstanding the above
portion of this Section 3, if at the time the option is granted the grantee (the
“Optionee”) owns or would be considered to own by reason of Code Section 424(d) more than 10% of
the total combined voting power of all classes of stock of the Company or its subsidiaries, such
option shall expire not more than 5 years from the date the option is granted. In addition, each
option shall be subject to early termination as provided in the Incentive Plan.




          Section 4. Purchase Price. The purchase price for shares acquired pursuant to the
exercise, in whole or in part, of any option shall not be less than the fair market value of the
shares at the time of the grant of the option. Fair market value (the “Fair Market Value”) shall
be determined by the Program Administrators on the basis of such factors as they deem appropriate;
provided, however, that Fair Market Value on any day shall be deemed to be, if the Common Stock is
traded on a national securities exchange, the closing price (or, if no reported sale takes place on
such day, the mean of the reported bid and asked prices) of the Common Stock on such day on the
principal such exchange, or, if the stock is included on the composite tape, the composite tape. In
each case, the Program Administrators’ determination of Fair Market Value shall be conclusive.




          Notwithstanding
the above portion of this Section 4, if at the time an option is granted the
Optionee owns or would be considered to own by reason of Code Section 424(d) more than 10% of the
total combined voting power of all classes of stock of the Company or its subsidiaries, the
purchase price of the shares covered by such option shall not be less than 110% of the Fair Market
Value of a share of Common Stock on the date the option is granted.




          Section 5. Maximum Amount Of Options Exercisable in Any Calendar Year.
Notwithstanding any other provision of this Incentive Plan, the aggregate Fair Market Value
(determined at the time any Incentive Stock Option is granted) of the Common Stock with respect to
which Incentive Stock




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Options become exercisable for the first time by any employee during any calendar year under all
stock option plans of the Company and its subsidiaries shall not exceed $100,000.




          Section 6. Exercise of Options. Each option shall be exercisable in one or more
installments during its term, and the right to exercise may be cumulative as determined by the
Program Administrators. No option may be exercised for a fraction of a share of Common Stock. The
purchase price of any shares purchased shall be paid in full in cash or by certified or cashier’s
check payable to the order of the Company or by shares of Common Stock, if permitted by the Program
Administrators, or by a combination of cash, check, or shares of Common Stock, at the time of
exercise of the option. If any portion of the purchase price is paid in shares of Common Stock,
those shares shall be tendered at their then Fair Market Value as determined by the Program
Administrators in accordance with Section 4 of this Incentive Plan. Payment in shares of Common
Stock includes the automatic application of shares of Common Stock received upon exercise of an
option to satisfy the exercise price for additional options.




          Section 7. Reorganization. In the event of the dissolution or liquidation of the
Company, any option granted under the Incentive Plan shall terminate as of a date to be fixed by
the Program Administrators; provided that not less than 30 days’ written notice of the date so
fixed shall be given to each Optionee and each such Optionee shall have the right during such
period (unless such option shall have previously expired) to exercise any option, including any
option that would not otherwise be exercisable by reason of an insufficient lapse of time.




          In the event of a Reorganization (as defined below) in which the Company is not the surviving
or acquiring company, or in which the Company is or becomes a subsidiary of another company after
the effective date of the Reorganization, then:





               (a) if there is no plan or agreement respecting the Reorganization (the
“Reorganization Agreement”) or if the Reorganization Agreement does not
specifically provide for the change, conversion or exchange of the outstanding
options for options of another corporation, then exercise and termination
provisions equivalent to those described in this Section 7 shall apply; or




               (b) if there is a Reorganization Agreement and if the Reorganization Agreement
specifically provides for the change, conversion, or exchange of the outstanding
options for options of another corporation, then the Program Administrators shall
adjust the outstanding unexercised options (and shall adjust the options remaining
under the Incentive Plan which have not yet been granted if the Reorganization
Agreement makes specific provision for such an adjustment) in a manner consistent
with the applicable provisions of the Reorganization Agreement.


The term “Reorganization” as used in this Section 7 shall mean any statutory merger,
statutory consolidation, sale of all or substantially all of the assets of the Company or a sale of
the Common Stock pursuant to which the Company is or becomes a subsidiary of another company after
the effective date of the Reorganization.




          Adjustments and determinations under this Section 7 shall be made by the Program
Administrators, whose decisions as to such adjustments or determinations shall be final, binding,
and conclusive.



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          Section 8. Written Notice Required. Any option granted pursuant to the terms of the
Incentive Plan shall be exercised when written notice of that exercise has been given to the
Company at its principal office by the person entitled to exercise the option and full payment for
the shares with respect to which the option is exercised has been received by the Company.




          Section 9. Compliance with Securities Laws. Shares of Common Stock shall not be issued
with respect to any option granted under the Incentive Plan, unless the exercise of that option and
the issuance and delivery of those shares pursuant to that exercise shall comply with all
applicable provisions of foreign, state and federal law including, without limitation, the
Securities Act of 1933, as amended, and the Exchange Act, and the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares may then be listed,
and shall be further subject to the approval of counsel for the Company with respect to such
compliance. The Program Administrators may also require an Optionee to furnish evidence
satisfactory to the Company, including a written and signed representation letter and consent to be
bound by any transfer restriction imposed by law, legend, condition, or otherwise, that the shares
are being purchased only for investment and without any present intention to sell or distribute the
shares in violation of any state or federal law, rule, or regulation. Further, each Optionee shall
consent to the imposition of a legend on the shares of Common Stock subject to his or her option
and the imposition of stop-transfer instructions restricting their transferability as required by
law or by this Section 9.




          Section 10. Employment of Optionee. Each Optionee, if requested by the Program
Administrators, must agree in writing as a condition of receiving his or her option, that he or she
will remain in the employment of the Company or its subsidiary corporations following the date of
the granting of that option for a period specified by the Program Administrators. Nothing in the
Incentive Plan or in any option granted hereunder shall confer upon any Optionee any right to
continued employment by the Company or its subsidiary corporations or limit in any way the right of
the Company or its subsidiary corporations at any time to terminate or alter the terms of that
employment.




          Section 11. Option Rights Upon Termination of Employment. If an Optionee ceases to be employed
by the Company or any subsidiary corporation for any reason other than death or disability, his or
her option shall immediately terminate; provided, however, that the Program Administrators may, in
their discretion, allow the option to be exercised (to the extent exercisable on the date of
termination of employment) at any time within three months after the date of termination of
employment, unless either the option or the Incentive Plan otherwise provides for earlier
termination.




          Section 12. Option Rights Upon Disability. If an Optionee becomes disabled within the
meaning of Code Section 422(e)(3) while employed by the Company or any subsidiary corporation, the
Program Administrators, in their discretion, may allow the option to be exercised, to the extent
exercisable on the date of termination of employment, at any time within one year after the date of
termination of employment due to disability, unless either the option or the Incentive Plan
otherwise provides for earlier termination.




          Section 13. Option Rights Upon Death of Optionee. Except as otherwise limited by the
Program Administrators at the time of the grant of an option, if an Optionee dies while employed by
the Company or any subsidiary corporation, or within three months after ceasing to be an employee
thereof, his or her option shall expire one year after the date of death unless by its terms it
expires sooner. During this one year or shorter period, the option may be exercised, to the extent
that it remains unexercised on the date of death, by the person or persons to whom the optionee’s
rights under the option shall pass by will or by the



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laws of descent and distribution, but only to the extent that the Optionee is entitled to exercise
the option at the date of death.




          Section 14. Options Not Transferable. Options granted pursuant to the terms of the
Incentive Plan may not be sold, pledged, assigned, or transferred in any manner otherwise than by
will or the laws of descent or distribution and may be exercised during the lifetime of an Optionee
only by that Optionee. No such options shall be pledged or hypothecated in any way nor shall they
be subject to execution, attachment, or similar process.




          Section 15. Adjustments to Number and Purchase Price of Optioned Shares. All options
granted pursuant to the terms of this Incentive Plan shall be adjusted in the manner prescribed by
Article 6 of the General Provisions of this Program.




PLAN II




HOLL TECHNOLOGIES COMPANY

COMPENSATORY STOCK OPTION PLAN




          Section 1. Purpose. The purpose of this Holl Technologies Company Compensatory Stock
Option Plan (the “Nonqualified Plan”) is to permit the Company to grant options to purchase shares
of its Common Stock. The Nonqualified Plan is designed to help attract and retain superior
personnel for positions of substantial responsibility with the Company and its subsidiaries, and to
provide key individuals with an additional incentive to contribute to the success of the Company.
Any option granted pursuant to the Nonqualified Plan shall be clearly and specifically designated
as not being an incentive stock option, as defined in Section 422 of the Code. This Nonqualified
Plan is Part II of the Program. Unless any provision herein indicates to the contrary, the
Nonqualified Plan shall be subject to the General Provisions of the Program.




          Section 2. Option Terms and Conditions. The terms and conditions of options granted
under the Nonqualified Plan may differ from one another as the Program Administrators shall in
their discretion determine as long as all options granted under the Nonqualified Plan satisfy the
requirements of the Nonqualified Plan.




          Section 3. Duration of Options. Each option and all rights thereunder granted pursuant
to the terms of the Nonqualified Plan shall expire on the date determined by the Program
Administrators, but in no event shall any option granted under the Nonqualified Plan expire later
than ten (10) years from the date on which the option is granted. In addition, each option shall be
subject to early termination as provided in the Nonqualified Plan.




          Section 4. Purchase Price. The purchase price for shares acquired pursuant to the
exercise, in whole or in part, of any option shall not be less than the fair market value of the
shares at the time of the grant of the option. Fair market value (the “Fair Market Value”) shall
be determined by the Program Administrators on the basis of such factors as they deem appropriate;
provided, however, that Fair Market Value on any day shall be deemed to be, if the Common Stock is
traded on a national securities exchange, the closing price (or, if no reported sale takes place on
such day, the mean of the reported bid and asked prices) of the Common Stock on such day on the
principal such exchange, or, if the stock is included on the



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composite tape, the composite tape. In each case, the Program Administrators’ determination of Fair
Market Value shall be conclusive.




          Section 5. Exercise of Options. Each option shall be exercisable in one or more
installments during its term and the right to exercise may be cumulative as determined by the
Program Administrators. No option may be exercised for a fraction of a share of Common Stock. The
purchase price of any shares purchased shall be paid in full in cash or by certified or cashier’s
check payable to the order of the Company or by shares of Common Stock, if permitted by the Program
Administrators, or by a combination of cash, check, or shares of Common Stock, at the time of
exercise of the option. If any portion of the purchase price is paid in shares of Common Stock,
those shares shall be tendered at their then Fair Market Value as determined by the Program
Administrators in accordance with Section 4 of the Nonqualified Plan. Payment in shares of Common
Stock includes the automatic application of shares of Common Stock received upon exercise of an
option to satisfy the exercise price for additional options.




          Section 6. Reorganization. In the event of the dissolution or liquidation of the
Company, any option granted under the Nonqualified Plan shall terminate as of a date to be fixed by
the Program Administrators; provided that not less than 30 days’ written notice of the date so
fixed shall be given to each Optionee and each such Optionee shall have the right during such
period (unless such option shall have previously expired) to exercise any option, including any
option that would not otherwise be exercisable by reason of an insufficient lapse of time.




          In the event of a Reorganization (as defined below) in which the Company is not the surviving
or acquiring company, or in which the Company is or becomes a subsidiary of another company after
the effective date of the Reorganization, then:





               (a) if there is no plan or agreement respecting the Reorganization
(“Reorganization Agreement”) or if the Reorganization Agreement does not
specifically provide for the change, conversion or exchange of the outstanding
options for options of another corporation, then exercise and termination
provisions equivalent to those described in this Section 6 shall apply; or




               (b) if there is a Reorganization Agreement and if the Reorganization Agreement
specifically provides for the change, conversion, or exchange of the outstanding
options for options of another corporation, then the Program Administrators shall
adjust the outstanding unexercised options (and shall adjust the options remaining
under the Nonqualified Plan which have not yet been granted if the Reorganization
Agreement makes specific provision for such an adjustment) in a manner consistent
with the applicable provisions of the Reorganization Agreement.


The term “Reorganization” as used in this Section 6 shall mean any statutory merger,
statutory consolidation, sale of all or substantially all of the assets of the Company or a sale of
the Common Stock pursuant to which the Company is or becomes a subsidiary of another company after
the effective date of the Reorganization.




          Adjustments and determinations under this Section 6 shall be made by the Program
Administrators, whose decisions as to such adjustments or determinations shall be final, binding,
and conclusive.




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          Section 7. Written Notice Required. Any option granted pursuant to the terms of this
Nonqualified Plan shall be exercised when written notice of that exercise has been given to the
Company at its principal office by the person entitled to exercise the option and full payment for
the shares with respect to which the option is exercised has been received by the Company.




          Section 8. Compliance with Securities Laws. Shares shall not be issued with respect to
any option granted under the Nonqualified Plan, unless the exercise of that option and the issuance
and delivery of the shares pursuant thereto shall comply with all applicable provisions of foreign,
state and federal law, including, without limitation, the Securities Act of 1933, as amended, and
the Exchange Act, and the rules and regulations promulgated thereunder, and the requirements of any
stock exchange upon which the shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance. The Program Administrators may
also require an Optionee to furnish evidence satisfactory to the Company, including a written and
signed representation letter and consent to be bound by any transfer restrictions imposed by law,
legend, condition, or otherwise, that the shares are being purchased only for investment purposes
and without any present intention to sell or distribute the shares in violation of any state or
federal law, rule, or regulation. Further, each Optionee shall consent to the imposition of a
legend on the shares of Common Stock subject to his or her option and the imposition of
stop-transfer instructions restricting their transferability as required by law or by this
Section 8.




          Section 9. Continued Employment or Service. Each Optionee, if requested by the Program
Administrators, must agree in writing as a condition of the granting of his or her option, to
remain in the employment of, or service to, the Company or any of its subsidiaries following the
date of the granting of that option for a period specified by the Program Administrators. Nothing
in this Nonqualified Plan or in any option granted hereunder shall confer upon any Optionee any
right to continued employment by, or service to, the Company or any of its subsidiaries, or limit
in any way the right of the Company or any subsidiary at any time to terminate or alter the terms
of that employment or service arrangement.




          Section 10. Option Rights Upon Termination of Employment or Service. If an Optionee
under this Nonqualified Plan ceases to be employed by, or provide services to, the Company or any
of its subsidiaries for any reason other than death or disability, his or her option shall
immediately terminate; provided, however, that the Program Administrators may, in their discretion,
allow the option to be exercised, to the extent exercisable on the date of termination of
employment or service, at any time within three months after the date of termination of employment
or service, unless either the option or this Nonqualified Plan otherwise provides for earlier
termination.




          Section 11. Option Rights Upon Disability. If an Optionee becomes disabled within the
meaning of Code Section 422 (e) (3) while employed by the Company or any subsidiary corporation,
the Program Administrators, in their discretion, may allow the option to be exercised, to the
extent exercisable on the date of termination of employment, at any time within one year after the
date of termination of employment due to disability, unless either the option or the Nonqualified
Plan otherwise provides for earlier termination.




          Section 12. Option Rights Upon Death of Optionee. Except as otherwise limited by the
Program Administrators at the time of the grant of an option, if an Optionee dies while employed
by, or providing services to, the Company or any of its subsidiaries, his or her option shall
expire one year after the date of death unless by its terms it expires sooner. During this one year
or shorter period, the option may be exercised, to the extent that it remains unexercised on the
date of death, by the person or persons to whom the



10









 






Optionee’s rights under the option shall pass by will or by the laws of descent and distribution,
but only to the extent that the Optionee is entitled to exercise the option at the date of death.




          Section 13. Options Not Transferable. Options granted pursuant to the terms of this
Nonqualified Plan may not be sold, pledged, assigned, or transferred in any manner otherwise than
by will or the laws of descent or distribution and may be exercised during the lifetime of an
Optionee only by that Optionee. No such options shall be pledged or hypothecated in any way nor
shall they be subject to execution, attachment, or similar process.




          Section 14. Adjustments to Number and Purchase Price of Optioned Shares. All options
granted pursuant to the terms of this Nonqualified Plan shall be adjusted in a manner prescribed by
Article 6 of the General Provisions of the Program.




PLAN III




HOLL TECHNOLOGIES COMPANY

RESTRICTED SHARE PLAN




          Section 1. Purpose. The purpose of this Holl Technologies Company Restricted Share
Plan (the “Restricted Plan”) is to promote the growth and general prosperity of the Company by
permitting the Company to grant restricted shares to help attract and retain superior personnel for
positions of substantial responsibility with the Company and its subsidiaries and to provide key
individuals with an additional incentive to contribute to the success of the Company. The
Restricted Plan is Part IV of the Program.




          Section 2. Terms and Conditions. The terms and conditions of restricted shares granted
under the Restricted Plan may differ from one another as the Program Administrators shall, in their
discretion, determine as long as all restricted shares granted under the Restricted Plan satisfy
the requirements of the Restricted Plan.




          Each restricted share grant shall provide to the recipient (the “Holder”) the transfer of a
specified number of shares of Common Stock of the Company that shall become nonforfeitable upon the
achievement of specified service or performance conditions within a specified period (the
“Restriction Period”) as determined by the Program Administrators. At the time that the restricted
share is granted, the Program Administrators shall specify the service or performance conditions
and the period of duration over which the conditions apply.




          The Holder of restricted shares shall not have any rights with respect to such award, unless
and until such Holder has executed an agreement evidencing the terms and conditions of the award
(the “Restricted Share Award Agreement”). Each individual who is awarded restricted shares shall be
issued a stock certificate in respect of such shares. Such certificate shall be registered in the
name of the Holder and shall bear an appropriate legend referring to the terms, conditions, and
restrictions applicable to such award, substantially in the following form:





The transferability of this certificate and the shares of stock represented hereby are
subject to the terms and conditions (including forfeiture) of the Holl Technologies Company
Restricted Share Plan and Restricted Share Award Agreement entered into between the
registered owner and Holl



11









 







Technologies Company. Copies of such Plan and Agreement are on file in the offices of Holl
Technologies Company.



          The Program Administrators shall require that the stock certificates evidencing such shares be
held in the custody of the Company until the restrictions thereon shall have lapsed, and that, as a
condition of any restricted share award, the Holder shall have delivered a stock power, endorsed in
blank, relating to the stock covered by such award. At the expiration of each Restriction Period,
the Company shall redeliver to the Holder certificates held by the Company representing the shares
with respect to which the applicable conditions have been satisfied.




          Section 3. Nontransferable. Subject to the provisions of the Restricted Plan and the
Restricted Share Award Agreements, during the Restriction Period as may be set by the Program
Administrators commencing on the grant date, the Holder shall not be permitted to sell, transfer,
pledge, or assign shares of restricted shares awarded under the Restricted Plan.




          Section 4.
Restricted Share Rights Upon Employment or Service. If a Holder terminates
employment or service with the company prior to the expiration of the Restriction Period, any
restricted shares granted to him subject to such Restriction Period shall be forfeited by the
Holder and shall be transferred to the Company. The Program Administrators may, in their sole
discretion, accelerate the lapsing of or waive such restrictions in whole or in part based upon
such factors and such circumstances as the Program Administrators may determine, in its sole
discretion, including, but not limited to, the Plan Participant’s retirement, death, or disability.




          Section 5. Stockholder Rights. The Holder shall have, with respect to the restricted
shares granted, all of the rights of a stockholder of the Company, including the right to vote the
shares, and the right to receive any dividends thereon. Certificates for shares of unrestricted
stock shall be delivered to the grantee promptly after, and only after, the Restriction Period
shall expire without forfeiture in respect of such restricted shares.




          Section 6. Compliance with Securities Laws. Shares shall not be issued under the
Restricted Plan unless the issuance and delivery of the shares pursuant thereto shall comply with
all relevant provisions of foreign, state and federal law, including, without limitation, the
Securities Act of 1933, as amended, and the Exchange Act, and the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares may then be listed,
and shall be further subject to the approval of counsel for the Company with respect to such
compliance. The Program Administrators may also require a Holder to furnish evidence satisfactory
to the Company, including a written and signed representation letter and consent to be bound by any
transfer restrictions imposed by law, legend, condition, or otherwise, that the shares are being
purchased only for investment purposes and without any present intention to sell or distribute the
shares in violation of any state or federal law, rule, or regulation. Further, each Holder shall
consent to the imposition of a legend on the shares of Common Stock issued pursuant to the
Restricted Share Plan and the imposition of stop-transfer instructions restricting their
transferability as required by law or by this Section 6.




          Section 7. Continued Employment or Service. Each Holder, if requested by the Program
Administrators, must agree in writing as a condition of the granting of his or her restricted
shares, to remain in the employment of, or service to, the Company or any of its subsidiaries
following the date of the granting of that restricted share for a period specified by the Program
Administrators. Nothing in the Restricted Plan or in any restricted share granted hereunder shall
confer upon any Holder any right to continued employment



12









 






by, or service to, the Company or any of its subsidiaries, or limit in any way the right of the
Company or any subsidiary at any time to terminate or alter the terms of that employment or service
arrangement.




          Section 8. Adjustments to Number and Purchase Price of Optioned Shares. All options
granted pursuant to the terms of the Restricted Plan shall be adjusted in a manner prescribed by
Article 6 of the General Provisions of the Program.




PLAN IV




HOLL TECHNOLOGIES COMPANY

STOCK PURCHASE PLAN




          Section 1. Purpose. The purpose of the Holl Technologies Company Stock Purchase Plan
(the “Stock Purchase Plan”) is to promote the growth and general prosperity of the Company by
permitting the Company to sell to employees of the Company and its subsidiaries shares of the
Company’s stock in accordance with Section 423 of the Code (“Section 423”), and it is the intention
of the Company to have the Stock Purchase Plan qualify as an Employee Stock Purchase Plan in
accordance with Section 423. Accordingly, the Stock Purchase Plan shall be construed to extend and
limit participation consistent with the requirements of Section 423.




          Section 2. Terms and Conditions. The terms and conditions of shares to be offered to
be sold to employees of the Company and its subsidiaries under the Stock Purchase Plan shall comply
with Section 423.




          Section 3. Offering Periods and Participation. The Stock Purchase Plan shall be
implemented through a series of consecutive and overlapping Offering Periods. An Eligible Employee
may enroll in an Offering Period by delivering an agreement evidencing the terms and conditions of
the stock subscription in a form prescribed by the Program Administrators (the “Subscription
Agreement”) to the Company’s payroll office at least five (5) business days prior to the Enrollment
Date for that Offering Period (or such lesser number of business days as the Program
Administrators, in their sole discretion, may permit). Eligible Employees shall participate in
only one Offering Period at a time, and a Subscription Agreement in effect for a Plan Participant
for a particular Offering Period shall continue in effect for subsequent Offering Periods if the
Plan Participant remains an Eligible Employee and has not withdrawn
pursuant to Section 7.




          Section 4. Options.





                    (a) Grants. On the Enrollment Date for each
Offering Period, each Eligible Employee
participating in such Offering Period shall be granted an option to purchase on each
Exercise Date during such Offering Period (at the Purchase Price) up to the lesser of: (i)
                                        
 (                    ) shares or (ii) that number of shares of Common Stock
determined by dividing $                     by the Fair Market Value of a share of Common Stock on
the Enrollment Date (such number of shares under clause (i) or (ii) being the “Periodic
Exercise Limit”). The option shall expire immediately after the last Exercise Date of the
Offering Period.



13









 






   
             
    (b) Grant Limitations. Any provisions of the Stock Purchase Plan to the
contrary notwithstanding, no Plan Participant shall be granted an option under the Stock
Purchase Plan:




                         (i) if, immediately
after the grant, such Plan Participant would own stock possessing
five percent (5%) or more of the total combined voting power or value of all classes of
stock of the Company or of any subsidiary (applying the constructive ownership rules of
Section 424(d) of the Code and treating stock that a Plan Participant may acquire under
outstanding options as stock owned by the Plan Participant); or




                         (ii) that permits such
Plan Participant’s rights to purchase stock under all employee
stock purchase plans of the Company and its subsidiaries to accrue at a rate that exceeds
Twenty Five Thousand Dollars ($25,000) worth of stock (determined at the Fair Market Value
of the shares at the time such option is granted) in any calendar year (computed utilizing
the rules of Section 423(b)(8) of the Code).




               (c) No Rights in Respect of Underlying Stock. The Plan Participant will have
no
interest or voting right in shares covered by an option until such option has been
exercised.




               (d) Common Stock Account. As a condition of participation in the Stock
Purchase Plan,
each Plan Participant shall be required to receive shares purchased under the Stock
Purchase Plan in a common stock account (the “Common Stock Account”) maintained by an agent
selected by the Company to hold the Common Stock purchased under the Stock Purchase Plan
(the “Custodian”) and such Plan Participant’s decision to participate in the Stock Purchase
Plan shall constitute the appointment of the Custodian as custodial agent for purpose of
holding such shares. The Common Stock Account will be governed by, and subject to, the
terms and conditions of a written agreement with the Custodian in a form approved by the
Program Administrators.




               (e) Dividends on Shares. Subject to the limitations of
Section 4(a) hereof and Section
423(b)(8) of the Code, all cash dividends, if any, paid with respect to shares of Common
Stock purchased under the Stock Purchase Plan and held in a Plan Participant’s Common Stock
Account shall be automatically invested in shares of Common Stock purchased at 100% of Fair
Market Value on the next Exercise Date. All non-cash distributions on Common Stock
purchased under the Stock Purchase Plan and held in a Plan Participant’s Common Stock
Account shall be paid to the Plan Participant as soon as practical.




               (f) Withdrawal of Shares From Common Stock Account. Prior to the Plan
Participant’s
termination of employment with the Company and its subsidiaries, a Plan Participant may
withdraw some or all of the whole shares held in the Plan Participant’s Common Stock
Account, provided that at least twelve (12) months have expired following the Exercise Date
on which such shares of Common Stock were purchased under the Stock Purchase Plan, and
provided, further, that the Plan Participant provides prior written notice to the Company
of such withdrawal if such withdrawal is prior to the expiration of twenty-four (24) months
following the Expiration Date on which shares of Common Stock were purchased under the
Stock Purchase Plan.



               Section 5. Payroll Deductions.



14









 







               (a) Plan Participant Designations. The Subscription Agreement applicable to
an Offering Period
shall designate payroll deductions to be made on each payday during the Offering Period as a whole
number percentage not exceeding twenty percent (20%) of such Eligible Employee’s compensation for
the pay period preceding such payday, provided that the aggregate of such payroll deductions during
the Offering Period shall not exceed twenty percent (20%) of the Plan Participant’s compensation
during said offering period.




               (b) Plan Account Balances. The Company shall make payroll deductions as
specified in each Plan
Participant’s Subscription Agreement on each payday during the offering period and credit such
payroll deductions to such Plan Participant’s Plan Account. A Plan Participant may not make any
additional payments into such Plan Account. No interest will accrue on any payroll deductions. All
payroll deductions received or held by the Company under the Stock Purchase Plan may be used by the
Company for any corporate purpose, and the Company shall not be obligated to segregate such payroll
deductions.




               (c) Plan Participant Changes. A Plan Participant may discontinue his or her
participation in
the Stock Purchase Plan as provided in Section 7, or may increase or decrease (subject to
such limits as the Program Administrator may impose) the rate of his or her payroll deductions
during any Purchase Period by filing with the Company a new Subscription Agreement authorizing such
a change in the payroll deduction rate. The change in rate shall be effective with the first full
payroll period following five (5) business days after the Company’s receipt of the new Subscription
Agreement, unless the Company elects to process a given change in participation more quickly.




               (d) Decreases. Notwithstanding the foregoing, to the extent necessary to
comply with Section
423(b)(8) of the Code and Section 4(b) herein, a Plan Participant’s payroll deductions
shall be decreased to zero percent at such time during any Purchase Period that is scheduled to end
during a calendar year (the “Current Purchase Period”) when the aggregate of all payroll deductions
previously used to purchase stock under the Stock Purchase Plan in a prior Purchase Period which
ended during that calendar year plus all payroll deductions accumulated with respect to the Current
Purchase Period equal $21,250 (based on the 85% discount). Payroll deductions shall recommence at
the rate provided in such Plan Participant’s Subscription Agreement at the beginning of the first
Purchase Period that is scheduled to end in the following calendar year, unless terminated by the
Plan Participant as provided in Section 7. 




               (e) Tax Obligations. At the time of each exercise of a Plan
Participant’s option, and at the
time any Common Stock issued under the Stock Purchase Plan to a Plan Participant is disposed of,
the Plan Participant must adequately provide for the Company’s federal, state or other tax
withholding obligations, if any, that arise upon the exercise of the option or the disposition of
the Common Stock. At any time, the Company may, but will not be obligated to, withhold from the
Plan Participant’s compensation the amount necessary for the Company to meet applicable withholding
obligations, including, but not limited to, any withholding required to make available to the
Company any tax deductions or benefit attributable to sale or early disposition of Common Stock by
the eligible employee.




               (f) Statements of Account. The Company shall maintain each Plan
Participant’s Plan Account
and shall give each Plan Participant a statement of account at least annually. Such statements
will set forth the amounts of payroll deductions, the Purchase Price




15












 






applicable to the Common Stock purchased, the number of shares purchased, the remaining cash
balance and the dividends received, if any, for the period covered.



          Section 6. Exercise of Options.





          (a) Automatic Exercise on Exercise Dates. Unless a Plan Participant withdraws as provided in
Section 7 below, his or her option for the purchase of shares will be exercised
automatically on each Exercise Date within the Offering Period in which such Plan Participant is
enrolled for the maximum whole number of shares of Common Stock as can then be purchased at the
applicable Purchase Price with the payroll deductions accumulated in such Plan Participant’s Plan
Account and not yet applied to the purchase of shares under the Stock Purchase Plan, subject to the
Periodic Exercise Limit. All such shares purchased under the Stock Purchase Plan shall be credited
to the Plan Participant’s Common Stock Account. During a Plan Participant’s lifetime, a Plan
Participant’s options to purchase shares under the Stock Purchase Plan shall be exercisable only by
the Plan Participant.




          (b) Compliance With Law. Shares of Common Stock shall not be issued with respect to any option
granted under the Stock Purchase Plan, unless the exercise of that option and the issuance and
delivery of those shares pursuant to that exercise comply with all applicable provisions of
foreign, state and federal law including, without limitation, the Securities Act of 1933, as
amended and the Exchange Act, and the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the shares may then be listed, and shall be further
subject to the approval of counsel for the Company with respect to such compliance. The Program
Administrators may also require a Plan Participant to furnish evidence satisfactory to the Company,
including a written and signed representation letter and consent to be bound by any transfer
restriction imposed by law, legend, condition, or otherwise, that the shares are being purchased
only for investment and without any present intention to sell or distribute the shares in violation
of any state or federal law, rule, or regulation. Further, each Plan Participant shall consent to
the imposition of a legend on the shares of Common Stock subject to his or her option and the
imposition of stop-transfer instructions restricting their transferability as required by law or by
this Section 6.




          (c) Excess Plan Account Balances. If, due to application of the Periodic Exercise Limit or
otherwise, there remains in a Plan Participant’s Plan Account immediately following exercise of
such Plan Participant’s option on an Exercise Date any cash accumulated during the Purchase Period
immediately preceding such Exercise Date and not applied to the purchase of shares under the Stock
Purchase Plan, such cash shall promptly be returned to the Plan Participant; provided, however,
that if the next Purchase Period (including, without limitation, by not withdrawing pursuant to
Section 7), such cash shall be contributed to the Plan Participant’s Plan Account for such
next Purchase Period.



          7. Withdrawal; Termination of Employment.





          (a) Voluntary Withdrawal. A Plan Participant may withdraw from an Offering Period
by giving written notice to the Company’s payroll office at least five (5) business
days prior to the next Exercise Date. Such withdrawal shall be effective beginning
five (5) business days after receipt by the Company’s payroll office of notice
thereof. On or promptly following the effective date of any withdrawal, all (but not
less than all) of the withdrawing Plan Participant’s payroll deductions credited to
his or her Plan Account and not yet applied to the purchase of shares under the



16









 






Stock Purchase Plan will be paid to such Plan Participant, and on the effective date of
such withdrawal such Plan Participant’s option for the Offering Period will be
automatically terminated and no further payroll deductions for the purchase of shares will
be made during the Offering Period. If a Plan Participant withdraws from an Offering
Period, payroll deductions will not resume at the beginning of any succeeding Offering
Period, unless the Plan Participant delivers to the Company a new Subscription Agreement
with respect thereto.




          (b) Termination of Employment. Promptly after a Plan Participant’s ceasing to be an
employee for any reason all shares of Common Stock held in a Plan Participant’s Common
Stock Account and the payroll deductions credited to such Plan Participant’s Plan Account
and not yet applied to the purchase of shares under the Stock Purchase Plan will be
returned to such Plan Participant or, in the case of his or her death, to the person or
persons entitled thereto, and such Plan Participant’s option will be automatically
terminated, provided that, if the Company does not learn of such death more than five (5)
business days prior to an Exercise Date, payroll deductions credited to such Plan
Participant’s Plan Account may be applied to the purchase of shares under the Stock
Purchase Plan on such Exercise Date.



          8. Transferability. Neither payroll deductions credited to a Plan Participant’s Plan
Account nor any rights with regard to the exercise of an option or to receive shares under the
Stock Purchase Plan may be assigned, transferred, pledged or otherwise disposed of by the Plan
Participant in any way other than by will or the laws of descent and distribution, and any option
granted to a Plan Participant shall, during such Plan Participant’s lifetime, be exercisable only
by such Plan Participant. Any such attempt at assignment, transfer, pledge or other disposition
shall be without effect, except that the Program Administrator may treat such act as an election to
withdraw from an offering period in accordance with
Section 7.




          9. Definitions. Capitalized terms used in the Stock Purchase Plan and not otherwise
defined in the Program have the meanings set forth below:




          “Compensation” means the gross base salary or hourly compensation and the gross amount
of any cash bonus paid to a Plan Participant, without reduction for contributions to any 401(k)
plan sponsored by the Company.




          “Eligible Employee” means an Employee who has been an Employee for least [up to two
years].




          “Employee” means any individual who is an employee of the Company for purposes of tax
withholding under the Code other than any employee of the Company described in Section
423(b)(4)(A), (B), (C) or (D) of the Code. For purposes of the Stock Purchase Plan, the employment
relationship shall be treated as continuing while the individual is on sick leave or other leave of
absence approved by the Company, except that when the period of leave exceeds 90 days and the
individual’s right to re-employment is not guaranteed either by statute or by contract, the
employment relationship will be deemed to have terminated on the 91st day of such leave.




          “Enrollment Date” means the last business day of the first payroll period of the
Company ending in                      and
                     of each Offering Period during the duration of
the Stock Purchase Plan, commencing with the payroll periods the first business days of which are
the           
           of    
              
   , 199         
            and the   
                
   of             
        , 199      
           
   , respectively.




17









 





          “Exercise Date” means the last business day of
                     (or in the first week of
                    ) or
                     (or in the first week of
                    ), as the case may be, of each
Purchase Period that corresponds with the end of a payroll period of the Company commencing with
the               
       of        
          
   , 199         
            for the Purchase Period
commencing with the             
     
    of      
               , 199                    ,
and the                      of
                    ,
199                     for the Purchase Period commencing with the            
          day of                     ,
199                    .




          “Offering Period” means each period of twenty-four (24) months, either (i) commencing
on the first business day of each                      that corresponds to the beginning of a payroll period
of the Company in                      (commencing with
                    ,
199                    ), and terminating on the last
business day of                      (or in the first week of
                    ) twenty-four (24) months later
that corresponds with the end of a payroll of the Company or (ii) commencing on the first business
day of each                      that corresponds to the beginning of a payroll period of the Company in
                     (commencing with
                    ,
199                    ), and terminating on the last business day of
                     (or in the first week of
                    ) twenty-four (24) months later that corresponds
with the end of a payroll period of the Company. The Program Administrators shall have the power to
change the duration of Offering Periods without stockholder approval in connection with any
adjustment required under Article 6 of the General Provisions, or if such change is announced at
least fifteen (15) days prior to the scheduled beginning of the first Offering Period to be
affected.




          “Plan Account” means the account maintained by the Company for the Plan Participants
in the Stock Purchase Plan, to which are credited the payroll deductions made for such Plan
Participant pursuant to Section 5 and from which are debited amounts paid for the purchase of
shares upon exercise of such Plan Participant’s option pursuant to Section 6.




          “Purchase Price” as of any Exercise Date means an amount equal to eighty-five percent
(85%) of the Fair Market Value of a share of Common Stock on the Exercise Date [or on the
Enrollment Date for the Offering Period in which such Exercise Date occurs, whichever is lower].




     
     “Purchase Period” means each six-month period within an Offering Period, commencing on
the first business day of each          
        
    that corresponds to the beginning of a payroll period
of the Company in           
           (commencing with   
                
  , 199            
        ), and     
          
      
(commencing with             
        , 199     
            
   ) that corresponds to the beginning of a payroll period for the
Company therein and ending on the last business day of each    
              
    (or in the first week of
            
              
           
   ) and          
       
     (or in the first week of      
           
    ), respectively, therein.




PLAN V




HOLL TECHNOLOGIES COMPANY

NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN




          Section 1. Purpose; Plan. The purpose of this Holl Technologies Company Non-Employee
Director Stock Option Plan (the “Directors Plan”) is to permit the Company to grant options to
purchase shares of its Common Stock to non-employee directors of the Company. Any option granted
pursuant to the Directors Plan shall be clearly and specifically designated as not being an
incentive stock option, as defined in Section 422 of the Code. This Directors Plan is Part V of the
Program. Unless any provision herein indicates to the contrary, the Nonqualified Plan shall be
subject to the General Provisions of the Program. On the next to last business day of each fiscal
year of the Company, the Company shall grant to each non-employee director of the Company options
to purchase
                     shares of Common Stock. The terms and conditions of options granted under the
Directors Plan shall be in duration, form and substance as the




18









 




Program Administrators shall in their discretion determine, but in no event shall any option
granted under the Directors Plan expire later than ten (10) years from the date on which the option
is granted.




          Section 2. Compliance with Securities Laws. Shares shall not be issued with respect to
any option granted under the Directors Plan, unless the exercise of that option and the issuance
and delivery of the shares pursuant thereto shall comply with all applicable provisions of foreign,
state and federal law, including, without limitation, the Securities Act of 1933, as amended, and
the Exchange Act, and the rules and regulations promulgated thereunder, and the requirements of any
stock exchange upon which the shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance. The Program Administrators may
also require an Optionee to furnish evidence satisfactory to the Company, including a written and
signed representation letter and consent to be bound by any transfer restrictions imposed by law,
legend, condition, or otherwise, that the shares are being purchased only for investment purposes
and without any present intention to sell or distribute the shares in violation of any state or
federal law, rule, or regulation. Further, each Optionee shall consent to the imposition of a
legend on the shares of Common Stock subject to his or her option and the imposition of
stop-transfer instructions restricting their transferability as required by law or by this
Section 2.




          Section 3. Adjustments to Number and Purchase Price of Optioned Shares. All options
granted pursuant to the terms of this Directors Plan shall be adjusted in a manner prescribed by
Article 6 of the General Provisions of the Program.




PLAN VI

STOCK APPRECIATION RIGHTS PROGRAM




     Section 1. SAR Terms and Conditions. The terms and conditions of SARs granted under
the Stock Appreciation Rights Plan (the “SAR Plan”) may differ from one another as the Plan
Administrators shall, in their discretion, determine in each SAR agreement (the “SAR Agreement”).
Unless any provision herein indicates to the contrary, this SAR Plan shall be subject to the
General Provisions of the Program.



     Section 2. Duration of Options. Each SAR and all rights thereunder granted pursuant to
the terms of the SAR Plan shall expire on the date determined by the Plan Administrators as
evidenced by the SAR Agreement, but in no event shall any SAR expire later than ten (10) years from
the date on which the SAR is granted. In addition, each SAR shall be subject to early termination
as provided in the SAR Plan.



     Section 3. Grant. Subject to the terms and conditions of the SAR Agreement, the Plan
Administrators may grant the right to receive a payment upon the exercise of an SAR which reflects
the appreciation in the Fair Market Value of the number of shares of Common Stock for which such
SAR was granted to any person who is eligible to receive Awards either: (i) in tandem with the
grant of an Incentive Option; (ii) in tandem with the grant of a Nonqualified Option; or (iii)
independent of the grant of an Incentive Option or Nonqualified Option. Each grant of an SAR which
is in tandem with the grant of an Incentive Option or Nonqualified Option shall be evidenced by the
same agreement as the Incentive Option or Nonqualified Option which is granted in tandem with such
SAR and such SAR shall relate to the same number of shares of Common Stock to which such SAR shall
relate and such other terms and conditions as the Plan Administrators, in their sole discretion,
deem are not inconsistent with the terms the SAR Plan, including conditions on the exercise of such
SAR which relate to the employment the Plan Participant or requirement that the Plan Participant
exchange a prior outstanding option and/or SAR.



19









 





     Section 4. Payment at Exercise. Upon the settlement of an SAR in accordance with the
terms of the SAR Agreement, the Plan Participant shall (subject to the terms and conditions of the
SAR Plan and SAR Agreement) receive a payment equal to the excess, if any, of the SAR Exercise
Price defined below) for the number of shares of the SAR being exercised at that time over the SAR
Grant Price (as defined below) for such shares. Such payment may be paid in cash or in shares of
the Company’s Common Stock or by a combination of the foregoing, at the time of exercise of the
SAR, specified by the Plan Administrators in the SAR Agreement. If any portion of the payment is
paid shares of the Company’s Common Stock, such shares shall be valued for this purpose at the SAR
Exercise Price on the date the SAR is exercised and any payment in shares which calls for a payment
in fractional share shall automatically be paid in cash based on such valuation. As used herein,
“SAR Exercise Date” shall mean the date on which the exercise of an SAR occurs under the SAR
Agreement, “SAR Exercise Price” shall mean the Fair Market Value of a shares of Common Stock on a
SAR Exercise Date and “SAR Grant Price” shall mean the price which would have been the option
exercise price for one share of Common Stock if the SAR had been granted as an option, or if the
SAR granted in tandem with an option, the option exercise price per share for the related option.



     Section 5. Special Terms and Conditions. Each SAR Agreement which evidences the grant
of an SAR shall incorporate such terms and conditions as the Plan Administrators in their solute
discretion deem are not inconsistent with the terms of the SAR Plan and the agreement for Incentive
Option or Nonqualified Option, if any, granted in tandem with such SAR except that: (i) if an SAR
is granted in tandem with an Incentive Option or Nonqualified Option, the SAR shall be exercisable
only when the related Incentive Option or Nonqualified Option is exercisable; and (ii) the Plan
Participant’s right to exercise an SAR granted in tandem with an Incentive Option or Nonqualified
Option shall be forfeited to the extent that he or she exercises the related Incentive Option or
Nonqualified Option and his or her right to exercise the Incentive Option or Nonqualified Option
shall be forfeited to the extent he or she exercises the related SAR, but any such forfeiture shall
not count as a forfeiture for purposes of making the shares subject to such option or SAR again
available for use under the General Provisions of the Plan.



20









 





PLAN VII

OTHER STOCK RIGHTS PROGRAM




     Section 1. Terms and Conditions. The terms and conditions of Performance Shares, Stock
Payments or Dividend Equivalent Rights granted under the Other Stock Rights Program (the “Stock
Rights Plan”) may differ from one another as the Plan Administrators shall, in their discretion,
determine in each stock rights agreement (the “Stock Rights Agreement”). Unless any provision
herein indicates to the contrary, this Stock Rights Plan shall be subject to the General Provisions
of the Program.



     Section 2. Duration. Each Performance Share or Dividend Equivalent Right and all
rights thereunder granted pursuant to the terms of the Stock Rights Plan shall expire on the date
determined by the Plan Administrators as evidenced by the Stock Rights Agreement, but in no event
shall any Performance Shares or Dividend Equivalent Rights expire later than ten (10) years from
the date on which the Performance Shares or Dividend Equivalent Rights are granted. In addition,
each Performance Share, Stock Payment or Dividend Equivalent Right shall be subject to early
termination as provided in the Stock Rights Plan.



     Section 3. Grant. Subject to the terms and conditions of the Stock Rights Agreement,
the Plan Administrators may grant Performance Shares, Stock Payments or Dividend Equivalent Rights
as provided under the Stock Rights Plant. Each grant of Performance Shares, Dividend Equivalent
Rights and Stock Payments shall be evidenced by a Stock Rights Agreement, which shall state the
terms and conditions of each as the Plan Administrators, in their sole discretion, deem are not
inconsistent with the terms of the Stock Rights Plan.



     Section 4. Performance Shares. Performance Shares shall become payable to a Plan
Participant based upon the achievement of specified Performance Objectives and upon such other
terms and conditions as the Plan Administrators may determine and specify in the Stock Rights
Agreement evidencing such Performance Shares. Each grant shall satisfy the conditions for
performance-based awards hereunder and under the General Provisions. A grant may provide for the
forfeiture of Performance Shares in the event of termination of employment or other events, subject
to exceptions for death, disability, retirement or other events, all as the Plan Administrators may
determine and specify in the Stock Rights Agreement for such grant. Payment may be made for the
Performance Shares at such time and in such form as the Plan Administrators shall determine and
specify in the Stock Rights Agreement and payment for any Performance Shares may be made in full in
cash or by certified cashier’s check payable to the order of the Company or, if permitted by the
Plan Administrators, by shares of the Company’s Common Stock or by the surrender of all or part of
an Award, or in other property, rights or credits deemed acceptable by the Plan Administrators or,
if permitted by the Plan Administrators, by a combination of the foregoing. If any portion of the
purchase price is paid in shares of the Company’s Common Stock, those shares shall be tendered at
their then Fair Market Value as determined by the Plan Administrators in accordance herewith.
Payment in shares of Common Stock includes the automatic application of shares of Common Stock
received upon the exercise or settlement of Performance Shares or other option or Award to satisfy
the exercise or settlement price.



21









 





     Section 5. Stock Payments. The Plan Administrators may grant Stock Payments to a
person eligible to receive the same as a bonus or additional compensation or in lieu of the
obligation of the Company or a subsidiary to pay cash compensation under other compensatory
arrangements, with or without the election of the eligible person, provided that the Plan
Participant will be required to pay an amount equal to the aggregate par value of any newly issued
Stock Payments. A Plan Participant shall have all the voting, dividend, liquidation and other
rights with respect to shares of Common Stock issued to the Plan Participant as a Stock Payment
upon the Plan Participant becoming holder of record of such shares of Common Stock; provided,
however, the Plan Administrators may impose such restrictions on the assignment or transfer of such
shares of Common Stock as they deem appropriate and as are evidenced in the Stock Rights Agreement
for such Stock Payment.



     Section 6. Dividend Equivalent Rights. The Plan Administrators may grant Dividend
Equivalent Rights in tandem with the grant of Incentive Option or Nonqualified Option, SARS,
Restricted Shares or Performance Shares that otherwise do not provide for the payment of dividends
on the shares of Common Stock subject to such awards for the period of time to which such Dividend
Equivalent Rights apply, or may grant Dividend Equivalent Rights that are independent of any other
such award. A Dividend Equivalent Right granted in tandem with another award may be evidenced by
the agreement for such other award; otherwise, a Dividend Equivalent Right shall be evidenced by a
separate Stock Rights Agreement. Payment may be made by the Company in cash or by shares of the
Company’s Common Stock or by a combination of the foregoing, may be immediate or deferred and may
be subject to such employment, performance objectives or other conditions as the Plan
Administrators may determine and specify in the Stock Rights Agreement for such Dividend Equivalent
Rights. The total payment attributable to a share of Common Stock subject to a Dividend Equivalent
Right shall not exceed one hundred percent (100%) of the equivalent dividends payable with respect
to an outstanding share of Common Stock during the term of such Dividend Equivalent Right, taking
into account any assumed investment (including assumed reinvestment in shares of Common Stock) or
interest earnings on ch equivalent dividends as determined under the Stock Rights Agreement in the
case of a deferred payment, provided that such percentage may increase to a maximum of two hundred
percent (200%) if the Dividend Equivalent Right is subject to a performance objective.



22









 





HOLL TECHNOLOGIES COMPANY

COMPENSATORY STOCK OPTION PLAN

GRANT OF OPTION




Date of Grant:                     ,
                    




     THIS GRANT, dated as of the date of grant first stated above (the “Date of Grant”), is
delivered by Holl Technologies Company, a California corporation (the “Company”) to
                                        

(the “Grantee”), who is a key employee or key non-employee of the Company or
one of its subsidiaries (the Grantee’s employer is sometimes referred to herein as the
(“Employer”).



     WHEREAS, the Board of Directors of the Company (the “Board”) on
                                        
, adopted the Holl Technologies Company Compensatory Stock Option
Plan (the “Plan”);



     WHEREAS, the Plan provides for the granting of stock options by a committee to be appointed by
the Board (the “Committee”) to key employees or key non-employees of the Company or any subsidiary
of the Company to purchase, or to exercise certain rights with respect to, shares of the Common
Stock of the Company, par value $.001 per share (the “Stock”), in accordance with the terms and
provisions thereof; and



     WHEREAS, the Committee considers the Grantee to be a person who is eligible for a grant of
compensatory stock options under the Plan, and has determined that it would be in the best interest
of the Company to grant the compensatory stock options documented herein.



     NOW, THEREFORE, the parties hereto, intending to be legally bound hereby, agree as follows:



1 Grant of Option.




     Subject to the terms and conditions hereinafter set forth, the Company, with the approval
and at the direction of the Committee, hereby grants to the Grantee, as of the Date of
Grant, an option to purchase up to shares of Stock at a price of $                     per share, the
fair market value. Such option is hereinafter referred to as the “Option” and the shares of
stock purchasable upon exercise of the Option are hereinafter sometimes referred to as the
“Option Shares.” The Option is intended by the parties hereto to be, and shall be treated
as, an option not qualified as an incentive stock option (as such term is defined under
section 422 of the Internal Revenue Code of 1986).



2 Installment Exercise.




     Subject to such further limitations as are provided herein, the option shall become
exercisable in                      installments, the Grantee having the right hereunder to purchase from the
Company the following number of Option Shares upon exercise of the Option, on and after the
following dates, in cumulative fashion:



     (a) on and after the                     
anniversary of the Date of Grant, up to                     
(ignoring fractional shares) of the total number of Option Shares;



23









 





     (b) on and after the                     
anniversary of the Date of Grant, up to an additional                     
(ignoring fractional shares) of the total number of Option Shares;



     (c) on and after the                     
anniversary of the Date of Grant, up to an additional                     
(ignoring fractional shares) of the total number of Option Shares;



     (d) on and after the                     
anniversary of the Date of Grant, up to an additional                     
(ignoring fractional shares) of the total number of Option Shares; and



     (e) on and after the                     
anniversary of the Date of Grant, the remaining Option Shares.



3 Termination of Option.




     (a) The Option and all rights hereunder with respect thereto, to the extent such rights shall
not have been exercised, shall terminate and become null and void after the expiration of
                     years from the Date of Grant (the “Option Term” [no more than 10 years from Date of
Grant].



     (b) Upon the occurrence of the Grantee’s ceasing for any reason to be employed by the Employer
(such occurrence being a “termination of the Grantee’s employment”), the Option, to the extent not
previously exercised, shall terminate and become null and void immediately upon such termination of
the Grantee’s employment, except in a case where the Committee may otherwise determine. As
determined by the Committee, upon a termination of the Grantee’s employment by reason of disability
or death, the Option may be exercised, but only to the extent that the Option was outstanding and
exercisable on such date of disability or death, up to a one-year period following the date of such
termination of the Grantee’s employment. As determined by the Committee, upon termination of the
Grantee’s employment by reason other than disability or death, the Option may be exercised, but
only to the extent the option was outstanding and exercisable on any such date of termination, up
to a three month period following the date of such termination of the Grantee’s employment.



     (c) In the event of the death of the Grantee, the Option may be exercised by the Grantee’s
legal representative, but only to the extent that the Option would otherwise have been exercisable
by the Grantee.



     (d) A transfer of the Grantee’s employment between the Company and any subsidiary of the
Company, or between any subsidiaries of the Company, shall not be deemed to be a termination of the
Grantee’s employment.



4 Exercise of Options.




     (a) The Grantee may exercise the Option with respect to all or any part of the number of
Option Shares then exercisable hereunder by giving the Secretary of the Company written notice of
intent to exercise. The notice of exercise shall specify the number of Option Shares as to which
the Option is to be exercised and the date of exercise thereof.



     (b) Full payment (in U.S. dollars) by the Grantee of the option price for the Option Shares
purchased shall be made on or before the exercise date specified in the notice of exercise in cash,
or, with the



24









 




prior written consent of the Committee, in whole or in part through the surrender of shares of
Stock at their fair market value on the exercise date.




     (c) On the exercise date specified in the Grantee’s notice or as soon thereafter as is
practicable, the Company shall cause to be delivered to the Grantee, a certificate or certificates
for the Option Shares then being purchased (out of theretofore unissued Stock or reacquired Stock,
as the Company may elect) upon full payment for such Option Shares. However, if (i) the Grantee is
subject to Section 16 of the Securities Exchange Act of 1934 and (ii) the Grantee exercises the
Option before six months have passed from the Date of Grant, the Company shall hold in its custody
any stock certificate arising from such exercise until six months has passed from the Date of
Grant. The obligation of the Company to deliver Stock shall, however, be subject to the condition
that if at any time the Committee shall determine in its discretion that the listing, registration
or qualification of the Option or the Option Shares upon any securities exchange or under any state
or federal law, or the consent or approval of any governmental regulatory body, is necessary or
desirable as a condition of, or in connection with, the Option or the issuance or purchase of Stock
thereunder, the Option may not be exercised 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 Committee.



     (d) If the Grantee fails to pay for any of the Option Shares specified in such notice or fails
to accept delivery thereof, the Grantee’s right to purchase such Option Shares may be terminated by
the Company. The date specified in the Grantee’s notice as the date of exercise shall be deemed the
date of exercise of the Option, provided that payment in full for the Option shares to be purchased
upon such exercise shall have been received by such date.



5 Adjustment of and Changes in Stock of the Company.




     In the event of a reorganization, recapitalization, change of shares, stock split, spin-off,
stock dividend, reclassification, subdivision or combination of shares, merger, consolidation,
rights offering, or any other change in the corporate structure or shares of capital stock of the
Company, the Committee shall make such adjustment as may be required under the applicable
reorganization agreement in the number and kind of shares of Stock subject to the Option or in the
option price; provided, however, that no such adjustment shall give the Grantee any additional
benefits under the Option. If there is no provision for the treatment of the Option under an
applicable reorganization agreement, the Option may terminate on a date determined by the Committee
following at least 30 days written notice to the Grantee.



6 Fair Market Value.




     As used herein, the “fair market value” of a share of Stock shall be determined by the
Committee. However, if the Stock is publicly-traded, fair market value of a share of Stock shall be
based upon the closing price per share of Stock on a national securities exchange.



7 No Rights of Stockholders.




     Neither the Grantee nor any personal representative shall be, or shall have any of the rights
and privileges of, a stockholder of the Company with respect to any shares of Stock purchasable or
issuable upon the exercise of the Option, in whole or in part, prior to the date of exercise of the
Option.



8 Non-Transferability of Option.




25









 





     During the Grantee’s lifetime, the option hereunder shall be exercisable only by the Grantee
or any guardian or legal representative of the Grantee, and the Option shall not be transferable
except, in case of the death of the Grantee, by will or the laws of descent and distribution, nor
shall the Option be subject to attachment, execution or other similar process. In the event of (a)
any attempt by the Grantee to alienate, assign, pledge, hypothecate or otherwise dispose of the
Option, except as provided for herein, or (b) the levy of any attachment, execution or similar
process upon the rights or interest hereby conferred, the Company may terminate the option by
notice to the Grantee and it shall thereupon become null and void.



9 Restriction on Exercise.




     The Option may not be exercised if the issuance of the Option Shares upon such exercise would
constitute a violation of any applicable federal or State securities or other law or valid
regulation. As a condition to the exercise of the Option, the Company may require the Grantee
exercising the Option to make any representation or warranty to the Company as may be required by
any applicable law or regulation and, specifically, may require the Grantee to provide evidence
satisfactory to the Company that the Option Shares are being acquired only for investment purposes
and without any present intention to sell or distribute the shares in violation of any federal or
State securities or other law or valid regulation.



10. Employment of Service Not Affected.




     The granting of the option or its exercise shall not be construed as granting to the Grantee
any right with respect to continuance of employment or service relationship with the Employer.
Except as may otherwise be limited by a written agreement between the Employer and the Grantee, the
right of the Employer to terminate at will the Grantee’s employment or service relationship with it
at any time (whether by dismissal, discharge, retirement or otherwise) is specifically reserved by
the Company, as the Employer or on behalf of the Employer (whichever the case may be), and
acknowledged by the Grantee.



11. Amendment of Option.




     The Option may be amended by the Committee at any time (i) if the Committee determines, in its
sole discretion, that amendment is necessary or advisable in the light of any addition to or change
in the Internal Revenue Code of 1986 or in the regulations issued thereunder, or any federal or
state securities law or other law or regulation, which change occurs after the Date of Grant and by
its terms applies to the option; or (ii) other than in the circumstances described in clause (i),
with the consent of the Grantee.



12. Notice.




     All notices, requests, demands, and other communications hereunder shall be in writing and
shall be deemed to have been duly given if delivered personally or by certified mail, return
receipt requested, as follows:



26









 





	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	To Employer:
	 	Holl Technologies Company	 	 
	 

	 	 	 	1884 Eastman Avenue, Suite 101	 	 
	 

	 	 	 	Ventura, CA 93003	 	 
	 
	 	 	 	 	 	 
	 

	 	To Grantee:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 





13. Incorporation of Plan by Reference.




     The Option is granted pursuant to the terms of the Plan, the terms of which are incorporated
herein by reference, and the Option shall in all respects be interpreted in accordance with the
Plan. The Committee shall interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on the parties hereto and any
other person claiming an interest hereunder, with respect to any issue arising hereunder or
thereunder.



14. Governing Law.




     The validity, construction, interpretation and effect of this instrument shall exclusively be
governed by and determined in accordance with the law of the State of California, except to the
extent preempted by federal law, which shall to the extent govern.



     IN WITNESS WHEREOF, the Company has caused its duly authorized officers to execute this Grant
of Option, and to apply the corporate seal hereto, and the Grantee has placed his or her signature
hereon, effective as of the Date of Grant.



	 	 	 	 	 
	HOLL TECHNOLOGIES COMPANY	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	ACCEPTED AND AGREED TO:	 	 
	 
	 	 	 	 
	 	 	 
	[Grantee]
	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 







27












 





HOLL TECHNOLOGIES COMPANY

RESTRICTED SHARES PLAN

RESTRICTED SHARE AWARD AGREEMENT




     THIS AGREEMENT is made as of
                                        
,                 
    , by and between Holl Technologies Company (the
“Company”) and   
             
             
              
               
   (“Grantee”):



     WHEREAS, the Company maintains the Holl Technologies Company Restricted Shares Plan
(“Restricted Shares Plan”) under which the Plan’s committee (“Committee”) may award shares
of the Company’s common stock of par value $.001 per share (“Common Stock”) to key
employees and key non-employees as the Committee may determine, subject to terms,
conditions, or restrictions as it may deem appropriate; and



     WHEREAS, pursuant to the Restricted Shares Plan, the Committee has awarded to Grantee a
restricted stock award conditioned upon the execution by the Company and Grantee of a Restricted
Share Award Agreement setting forth all the terms and conditions applicable to such award;



     NOW, THEREFORE, in consideration of the mutual promise and covenant contained herein, it is
hereby agreed as follows:




	1.	 	Award of Shares.
	 
	 	 	Under the terms of the Restricted Shares Plan, the Committee hereby awards and
transfers to Grantee a restricted stock award on
                                        
 (“Grant Date”),
covering shares of Common Stock (“Shares”) subject to the terms, conditions, and
restrictions set forth in this Agreement. This transfer of Shares shall constitute a
transfer of such property in connection with Grantee’s performance of service to the
Company (which transfer is intended to constitute a “transfer” for purposes of Section 83
of the Internal Revenue Code).
	 
	2.	 	Share Restrictions.
	 
	 	 	During the period beginning on the Grant Date and ending on (the “Restriction
Period”), Grantee’s ownership of the Shares shall be subject to a risk of forfeiture (which
risk is intended to constitute a “substantial risk of forfeiture” for purposes of Section
83 of the Internal Revenue Code). Specifically, if Grantee’s employment or service with
the Company is terminated for any reason, including Grantee’s death, disability, or
retirement at any time before the Restriction Period ends, Grantee shall forfeit his or her
ownership in the Shares. However, in the event of Grantee’s termination of employment or
service, the Committee may, in its sole discretion, based upon relevant circumstances such
as the Grantee’s death, disability, or retirement, waive the minimum employment or service
requirement and provide Grantee with a nonforfeitable right to the Shares as of the date of
such termination of employment or service.
	 
	3.	 	Stock Certificates.
	 
	 	 	A stock certificate evidencing the Shares shall be issued in the name of Grantee as of
the Grant Date. Grantee shall thereupon be the shareholder of all the Shares represented
by the stock certificate. As




1









 






	 	 	such, Grantee shall be entitled to all rights of a stockholder of the Company, including
the right to vote the Shares and receive dividends and/or other distributions declared on
such Shares.
	 
	 	 	Physical possession or custody of the stock certificate shall be retained by the
Company until such time as the Restriction Period lapses without the occurrence of any
forfeiture of the Shares in a manner described in the above Paragraph 2. Upon the
expiration of the Restriction Period without the occurrence of such a forfeiture, the
Company shall cause the stock certificate covering the Shares to be delivered to Grantee.
In the event that Grantee’s employment or service with the Company is terminated prior to
the lapse of the Restriction Period and there occurs a forfeiture of the Shares, the stock
certificate representing such Shares shall be then reverted to the Company.






	4.	 	Nontransferable.
	 
	 	 	During the Restriction Period, the Shares covered by the restricted stock award shall
not be transferable by Grantee by means of sale, assignment, sale, pledge, encumbrance, or
otherwise. During the Restriction Period, the Company shall place a legend on the stock
certificate restricting the transferability of such certificate and referring to the terms
and conditions applicable to the Shares pursuant to the Restricted Shares Plan and this
Agreement.
	 
	 	 	Upon the lapse of the Restriction Period, the Shares shall not be delivered to Grantee
if such delivery would constitute a violation of any applicable federal or State securities
or other law or valid regulation. As a condition to the delivery of the Shares to Grantee,
the Company may require Grantee to make any representation or warranty as may be required
by any applicable law or regulation and, specifically, may require Grantee to provide
evidence satisfactory to the Company that the Shares are being acquired only for investment
purposes and without any present intention to sell or distribute the shares in violation of
any federal or State securities or other law or valid regulation.
	 
	5.	 	Administration.
	 
	 	 	The Committee shall have full authority and discretion (subject only to the express
provisions of the Restricted Shares Plan) to decide all matters relating to the
administration and interpretation of the Restricted Shares Plan and this Agreement. All
such Committee determinations shall be final, conclusive, and binding upon the Company,
Grantee, and any and all interested parties.
	 
	6.	 	Right to Continued Employment or Service.
	 
	 	 	Nothing in the Restricted Shares Plan or this Agreement shall confer on a Grantee any
right to continue in the employ of or service to the Company or, except as may otherwise be
limited by a written agreement between the Company and the Grantee, in any way affect the
Company’s right to terminate Grantee’s employment or service without prior notice at any
time for any or no reason.
	 
	7.	 	Amendment.
	 
	 	 	This Agreement shall be subject to the terms of the Restricted Shares Plan as amended,
the terms of which are incorporated herein by reference. However, the restricted stock
award that is the subject




2









 








	 	 	of this Agreement may not in any way be restricted or limited by any Restricted Shares Plan
amendment or termination approved after the date of the award without Grantee’s written
consent.
	 
	8.	 	Force and Effect.
	 
	 	 	The various provisions of this Agreement are severable in their entirety. Any
determination of invalidity or unenforceability of any one provision shall have no effect
on the continuing force and effect of the remaining provisions.
	 
	9.	 	Governing Law.
	 
	 	 	This Agreement shall be construed and enforced in accordance with and governed by the
laws of the State of California.
	 
	10.	 	Successors.
	 
	 	 	This Agreement shall be binding upon and inure to the benefit of the successors,
assigns, and heirs of the respective parties.
	 
	11.	 	Notice.
	 
	 	 	All notices, requests, demands, and other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered personally or by certified mail,
return receipt requested, as follows:





	 	 	 	 	 	 	 
	 

	 	To Employer:
	 	     Holl Technologies Company
	 	 
	 

	 	 	 	1884 Eastman Avenue, Suite 101	 	 
	 

	 	 	 	Ventura, CA 93003	 	 
	 
	 	 	 	 	 	 
	 

	 	To Grantee:	 	 	 	 
	 

	 	 	 	 


	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 







	12.	 	Entire Agreement.
	 
	 	 	This Agreement contains the entire understanding of the parties and shall not be
modified or amended except in writing and duly signed by the parties. No waiver by either
party of any default under this Agreement shall be deemed a waiver of any later default.




3









 







	 	 	 	 	 	 	 
	 

	IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date hereof.
	 
	 

	HOLL TECHNOLOGIES COMPANY
	 
	 

	 	 	 	[Grantee]	 	 
	 
	By:   	 	 	 	 	 
	 

	 	 

Name:
	 	 
        Name:
	 	 
	 

	 	Title:
	 	          Title:
	 	 






4









 






HOLL TECHNOLOGIES COMPANY INCENTIVE STOCK OPTION PLAN

GRANT OF OPTION



Date of Grant:    
               
              
              
           
   ,                     




     THIS GRANT, dated as of the date of grant first stated above (the “Date of Grant”) , is
delivered by, a California corporation (the “Company”) to
                                        
(the “Grantee”),
who is an employee of the Company or one of its subsidiaries (the Grantee’s employer is sometimes
referred to herein as the “Employer”).



     WHEREAS, the Board of Directors of the Company (the “Board”) on
                                        
, adopted,
with subsequent stockholder approval, the Holl Technologies Company Incentive Stock Option Plan
(the “Plan”);



     WHEREAS, the Plan provides for the granting of incentive stock options by a committee to be
appointed by the Board (the “Committee”) to key employees of the Company or any subsidiary of the
Company to purchase, or to exercise certain rights with respect to, shares of the Common Stock of
the Company, par value $.001 per share (the “Stock”), in accordance with the terms and provisions
thereof; and



     WHEREAS, the Committee considers the Grantee to be a person who is eligible for a grant of
incentive stock options under the Plan, and has determined that it would be in the best interest of
the Company to grant the incentive stock options documented herein.



     NOW, THEREFORE, the parties hereto, intending to be legally bound hereby, agree as follows:






	1.	 	Grant of Option.





     Subject to the terms and conditions hereinafter set forth, the Company, with the approval and
at the direction of the Committee, hereby grants to the Grantee, as of the Date of Grant, an option
to purchase up to
                     shares of Stock at a price of
$                     per share, the fair market value [or,
with respect to 10% stockholders, 110% of fair market value]. Such option is hereinafter referred
to as the “Option” and the shares of stock purchasable upon exercise of the Option are hereinafter
sometimes referred to as the “Option Shares.” The Option is intended by the parties hereto to be,
and shall be treated as, an incentive stock option (as such term is defined under section 422 of
the Internal Revenue Code of 1986).




	2.	 	Installment Exercise.





     Subject to such further limitations as are provided herein, the option shall become
exercisable in                      installments, the Grantee having the right hereunder to purchase from the
Company the following number of option Shares upon exercise of the Option, on and after the
following dates, in cumulative fashion:



     (a) on and after the                     
anniversary of the Date of Grant, up to                      (ignoring
fractional shares) of the total number of Option Shares;



1









 





     (b) on and after the                     
anniversary of the Date of Grant, up to an additional
                    
(ignoring fractional shares) of the total number of Option Shares;



     (c) on and after the                     
anniversary of the Date of Grant, up to an additional
                    
(ignoring fractional shares) of the total number of Option Shares;



     (d) on and after the                     
anniversary of the Date of Grant, up to an additional
                    
(ignoring fractional shares) of the total number of Option Shares; and



     (e) on and after the                     
anniversary of the Date of Grant, the remaining Option
Shares.




	3.	 	Termination of Option.





     (a) The Option and all rights hereunder with respect thereto, to the extent such rights shall
not have been exercised, shall terminate and become null and void after the expiration of ___
years from the Date of Grant (the “Option Term” [no more than 10 years from Date of Grant or, in
the case of a 10% owner, no more than 5 years from Date of Grant]).



     (b) Upon the occurrence of the Grantee’s ceasing for any reason to be employed by the Employer
(such occurrence being a “termination of the Grantee’s employment”), the Option, to the extent not
previously exercised, shall terminate and become null and void immediately upon such termination of
the Grantee’s employment, except in a case where the Committee may otherwise determine. As
determined by the Committee, upon a termination of the Grantee’s employment by reason of disability
or death, the Option may be exercised, but only to the extent that the Option was outstanding and
exercisable on such date of disability or death, up to a one-year period following the date of such
termination of the Grantee’s employment. As determined by the Committee, upon termination of the
Grantee’s employment by reason other than death or disability, the Option may be exercised, but
only to the extent the option was outstanding and exercisable on any such date of termination, up
to a three-month period following the date of such termination of the Grantee’s employment.



     (c) In the event of the death of the Grantee, the Option may be exercised by the Grantee’s
legal representative, but only to the extent that the option would otherwise have been exercisable
by the Grantee.



     (d) A transfer of the Grantee’s employment between the Company and any subsidiary of the
Company, or between any subsidiaries of the Company, shall not be deemed to be a termination of the
Grantee’s employment.




	4.	 	Exercise of options.





     (a) The Grantee may exercise the option with respect to all or any part of the number of
option Shares then exercisable hereunder by giving the Secretary of the Company written notice of
intent to exercise. The notice of exercise shall specify the number of Option Shares as to which
the Option is to be exercised and the date of exercise thereof.



     (b) Full payment (in U.S. dollars) by the Grantee of the option price for the Option Shares
purchased shall be made on or before the exercise date specified in the notice of exercise in cash,
or, with the



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prior written consent of the Committee, in whole or in part through the surrender of shares of
Stock at their fair market value on the exercise date.




     (c) On the exercise date specified in the Grantee’s notice or as soon thereafter as is
practicable, the Company shall cause to be delivered to the Grantee, a certificate or certificates
for the option Shares then being purchased (out of theretofore unissued stock or reacquired Stock,
as the Company may elect) upon full payment for such option Shares. However, if (i) the Grantee is
subject to Section 16 of the Securities Exchange Act of 1934 and (ii) the Grantee exercises the
Option before six months have passed from the Date of Grant, the Company shall hold in its custody
any stock certificate arising from such exercise until six months has passed from the Date of
Grant. The obligation of the Company to deliver Stock shall, however, be subject to the condition
that if at any time the Committee shall determine in its discretion that the listing, registration
or qualification of the Option or the Option Shares upon any securities exchange or under any state
or federal law, or the consent or approval of any governmental regulatory body, is necessary or
desirable as a condition of, or in connection with, the Option or the issuance or purchase of Stock
thereunder, the Option may not be exercised 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 Committee.



     (d) If the Grantee fails to pay for any of the Option Shares specified in such notice or fails
to accept delivery thereof, the Grantee’s right to purchase such Option Shares may be terminated by
the Company. The date specified in the Grantee’s notice as the date of exercise shall be deemed the
date of exercise of the Option, provided that payment in full for the Option Shares to be purchased
upon such exercise shall have been received by such date.




	5.	 	Adjustment of and changes in Stock of the Company.





     In the event of a reorganization, recapitalization, change of shares, stock split, spin-off,
stock dividend, reclassification, subdivision or combination of shares, merger, consolidation,
rights offering, or any other change in the corporate structure or shares of capital stock of the
Company, the Committee shall make such adjustment as may be required under the applicable
reorganization agreement in the number and kind of shares of Stock subject to the option or in the
option price; provided, however, that no such adjustment shall give the Grantee any additional
benefits under the Option. If there is no provision for the treatment of the Option under an
applicable reorganization agreement, the Option may terminate on a date determined by the Committee
following at least 30 days written notice to the Grantee.




	6.	 	Fair Market Value.





     As used herein, the “fair market value” of a share of Stock shall be determined by the
Committee. However, if the Stock is publicly-traded, fair market value of a share of Stock shall be
based upon the closing price per share of Stock on a national securities exchange.




	7.	 	No Rights of Stockholders.





     Neither the Grantee nor any personal representative shall be, or shall have any of the rights
and privileges of, a stockholder of the Company with respect to any shares of Stock purchasable or
issuable upon the exercise of the Option, in whole or in part, prior to the date of exercise of the
Option.




	8.	 	Non-Transferability of Option.




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     During the Grantee’s lifetime, the Option hereunder shall be exercisable only by the Grantee
or any guardian or legal representative of the Grantee, and the option shall not be transferable
except, in case of the death of the Grantee, by will or the laws of descent and distribution, nor
shall the Option be subject to attachment, execution or other similar process. In the event of (a)
any attempt by the Grantee to alienate, assign, pledge, hypothecate or otherwise dispose of the
option, except as provided for herein, or (b) the levy of any attachment, execution or similar
process upon the rights or interest hereby conferred, the Company may terminate the Option by
notice to the Grantee and it shall thereupon become null and void.




	9.	 	Restriction on Exercise.





     The Option may not be exercised if the issuance of the Option Shares upon such exercise would
constitute a violation of any applicable federal or State securities or other law or valid
regulation. As a condition to the exercise of the Option, the Company may require the Grantee
exercising the Option to make any representation or warranty to the Company as may be required by
any applicable law or regulation and, specifically, may require the Grantee to provide evidence
satisfactory to the Company that the Option Shares are being acquired only for investment purposes
and without any present intention to sell or distribute the shares in violation of any federal or
State securities or other law or valid regulation.




	10.	 	Employment Not Affected.





     The granting of the option or its exercise shall not be construed as granting to the Grantee
any right with respect to continuance of employment of the Employer. Except as may otherwise be
limited by a written agreement between the Employer and the Grantee, the right of the Employer to
terminate at will the Grantee’s employment with it at any time (whether by dismissal, discharge,
retirement or otherwise) is specifically reserved by the Company, as the Employer or on behalf of
the Employer (whichever the case may be), and acknowledged by the Grantee.




	11.	 	Amendment of option.





     The Option may be amended by the Committee at any time (i) if the Committee determines, in its
sole discretion, that amendment is necessary or advisable in the light of any addition to or change
in the Internal Revenue Code of 1986 or in the regulations issued thereunder, or any federal or
state securities law or other law or regulation, which change occurs after the Date of Grant and by
its terms applies to the Option; or (ii) other than in the circumstances described in clause (i),
with the consent of the Grantee.




	12.	 	Notice.





     All notices, requests, demands, and other communications hereunder shall be in writing and
shall be deemed to have been duly given if delivered personally or by certified mail, return
receipt requested, as follows:



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	 	To Employer:
	 	     Holl Technologies Company
	 	 
	 

	 	 	 	1884 Eastman Avenue, Suite 101	 	 
	 

	 	 	 	Ventura, CA 93003	 	 
	 
	 	 	 	 	 	 
	 

	 	To Grantee:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 







	13.	 	Incorporation of Plan by Reference.





        The Option is granted pursuant to the terms of the Plan, the terms of which are incorporated
herein by reference, and the option shall in all respects be interpreted in accordance with the
Plan. The Committee shall interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on the parties hereto and any
other person claiming an interest hereunder, with respect to any issue arising hereunder or
thereunder.




	14.	 	Governing Law.





        The validity, construction, interpretation and effect of this instrument shall exclusively be
governed by and determined in accordance with the law of the State of California, except to the
extent preempted by federal law, which shall to the extent govern.



        IN WITNESS WHEREOF, the Company has caused its duly authorized officers to execute this Grant
of Option, and to apply the corporate seal hereto, and the Grantee has placed his or her signature
hereon, effective as of the Date of Grant.


HOLL TECHNOLOGIES COMPANY




	 	 	 	 	 
	 	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	ACCEPTED AND AGREED TO:	 	 
	 
	 	 	 	 
	[Grantee]	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 







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