Exhibit 10.35


 


URANIUM RESOURCES, INC.


 


 


2004 STOCK INCENTIVE PLAN


 


General.  This
Stock Incentive Plan (the “Plan”) provides eligible employees of Uranium
Resources, Inc., (the “Company”) with the opportunity to acquire or expand
their equity interest in the Company by making available for purchase Common
Shares, par value $.001 per share, of the Company (“Common Shares”), through
the granting of nontransferable options to purchase Common Shares (“Stock
Options”).  It is intended that key
employees may be granted, simultaneously or from time to time, Stock Options
that qualify as incentive stock options (“Incentive Stock Options”) under
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) or
Stock Options that do not so qualify (“Non-qualified Stock Options”).  No provision of the Plan is intended or shall
be construed to grant employees alternative rights in any Incentive Stock
Option granted under the Plan so as to prevent such Option from qualifying
under Section 422 of the Code.


 


1.                                       Purpose of the Plan.  The
purpose of the Plan is to provide continuing incentives to key employees of the
Company and of any subsidiary corporation of the Company, by encouraging such
key employees to acquire new or additional share ownership in the Company,
thereby increasing their proprietary interest in the Company’s business and
enhancing their personal interest in the Company’s success.


 


For purposes of the Plan, a “subsidiary
corporation” consists of any corporation at least fifty percent (50%) of the
voting power of all classes of the stock of which is directly or indirectly
owned by the Company.


 


2.                                       Effective Date of the Plan.  The Plan
shall become effective upon its adoption by the Board of Directors, subject to
approval by holders of a majority of the outstanding shares of voting capital
stock of the Company.  If the Plan is not
so approved within twelve (12) months after the date the Plan is adopted by the
Board of Directors, the Plan and any grants made hereunder shall be null and
void.  However, if the Plan is so
approved, no further stockholder approval shall be required with respect to the
making of grants pursuant to the Plan, except as provided in Section 10 hereof.


 


3.                                       Administration of the Plan.  The Plan
shall be administered by the Compensation Committee of the Board of Directors
of the Company, or by any other committee selected by such Board of Directors
by majority vote, which Compensation Committee or other committee shall be
composed solely of no fewer than two (2) members of such Board of Directors who
are “outside directors” as defined in Section 162(m) of the Code and the
Regulations thereunder (the “Committee”). 
No person shall be appointed to the Committee who, during the one-year
period immediately preceding such person’s appointment to the Committee, has
received any grants of Stock Options under the Plan or any similar stock option
or stock incentive plan, other than a formula-based plan, maintained by the
Company or any subsidiary corporation.  A
member of the Committee shall not be eligible to participate in this Plan while
serving on the Committee.


 


A majority of the Committee shall constitute
a quorum.  The acts of a majority of the
members present at any meeting at which a quorum is present (or acts
unanimously approved in writing by the members of the Committee) shall
constitute binding acts of the Committee.


 


Subject to the terms and conditions of the
Plan, the Committee shall be authorized and empowered:


 


(a)                                  To select the key employees to whom grants may be
made;


 


(b)                                 To determine the number of Common Shares to be
covered by any Grant;


 


(c)                                  To prescribe the terms and conditions of any
grants made under the Plan, and the form(s) and agreement(s) used in connection
with such grants, which shall include agreements governing the granting of
Stock Options;


 


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(d)                                 To determine the time or times when Stock Options
will be granted and when they will terminate in whole or in part;


 


(e)                                  To determine the time or times when Stock Options
that are granted may be exercised;


 


(f)                                    To determine, at the time a Stock Option is
granted under the Plan, whether such Option is an Incentive Stock Option
entitled to the benefits of Section 422 of the Code; and


 


(g)                                 To establish any other Stock Option agreement
provisions not inconsistent with the terms and conditions of the Plan or, where
the Stock Option is an Incentive Stock Option, with the terms and conditions of
Section 422 of the Code.


 


4.                                       Employees Eligible for Grants.  Grants
may be made from time to time to those key employees of the Company or a
subsidiary corporation, who are designated by the Committee in its sole and
exclusive discretion.  Key employees may
include, but shall not necessarily be limited to, members of the Board of Directors
(excluding members of the Committee), and officers, of the Company and any
subsidiary corporation; however, Stock Options intended to qualify as Incentive
Stock Options shall only be granted to key employees while actually employed by
the Company or a subsidiary corporation. 
The Committee may grant more than one Stock Option to the same key
employee.  No Stock Option shall be
granted to any key employee during any period of time when such key employee is
on a leave of absence.


 


5.                                       Shares Subject to the Plan.  The
shares to be issued pursuant to any Stock Option granted under the Plan shall
be Common Shares.  Either Common Shares
held as treasury stock, or authorized and unissued Common Shares, or both, may
be so issued, in such amount or amounts within the maximum limits of the Plan
as the Board of Directors shall from time to time determine.


 


Subject to the provisions of the next
succeeding paragraph of this Section 6 and the provisions of Section 7(h),
the aggregate number of Common Shares that can be actually issued under the
Plan shall be seven million (7,000,000) Common Shares.  The number of shares with respect to which
options may be granted to any key employee in any calendar year may not exceed
2,000,000 shares.


 


If, at any time subsequent to the date of
adoption of the Plan by the Board of Directors, the number of Common Shares are
increased or decreased, or changed into or exchanged for a different number or
kind of shares of stock or other securities of the Company or of another
corporation (whether as a result of a stock split, stock dividend, combination
or exchange of shares, exchange for other securities, reclassification,
reorganization, redesignation, merger, consolidation, recapitalization or
otherwise):  (i) there shall
automatically be substituted for each Common Share subject to an unexercised
Stock Option (in whole or in part) granted under the Plan, the number and kind
of shares of stock or other securities into which each outstanding Common Share
shall be changed or for which each such Common Share shall be exchanged; and
(ii) the option price per Common Share or unit of securities shall be increased
or decreased proportionately so that the aggregate purchase price for the
securities subject to a Stock Option shall remain the same as immediately prior
to such event.  In addition to the
foregoing, the Committee shall be entitled in the event of any such increase,
decrease or exchange of Common Shares to make other adjustments to the
securities subject to a Stock Option, the provisions of the Plan, and to any
related Stock Option agreements (including adjustments which may provide for
the elimination of fractional shares), where necessary to preserve the terms
and conditions of any grants hereunder.


 


6.                                       Stock Option Provisions.


 


(a)                                  General.  The Committee may grant to key
employees (also referred to as “optionees”) nontransferable Stock Options that
either qualify as Incentive Stock Options under Section 422 of the Code or do
not so qualify.  However, any Stock
Option which is an Incentive Stock Option shall only be granted within 10 years
from the earlier of (i) the date this Plan is adopted by the Board of Directors
of the Company; or (ii) the date this Plan is approved by the stockholders of
the Company.


 


(b)                                 Stock Option Price.  The option
price per Common Share which may be purchased under an Incentive Stock Option
under the Plan shall be determined by the Committee at the time of Grant, but
shall not be less than one hundred percent (100%) of the fair market value of a
Common Share, determined as of the date


 


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such Option is granted; however, if a key
employee to whom an Incentive Stock Option is granted, at the time of the grant
of such Option, owns more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or any subsidiary corporation
within the meaning of Section 422(b)(6) of the Code (a “Substantial Shareholder”),
the option price per Common Share of such Option, as determined by the Committee,
shall not be less than one hundred ten percent (110%) of the fair market value
of a Common Share on the date such Option is granted.  The option price per Common Share under each
Stock Option granted pursuant to the Plan which is not an Incentive Stock
Option shall be determined by the Committee at the time of Grant.  Except as specifically provided above, the
fair market value of a Common Share shall be determined in accordance with
procedures to be established by the Committee. 
The day on which the Committee approves the granting of a Stock Option
shall be considered the date on which such Option is granted.


 


(c)                                  Period of Stock Option.  The
Committee shall determine when each Stock Option is to expire.  However, no Stock Option shall be exercisable
by its terms for a period of more than ten (10) years from the date upon which
such Option is granted.  Further, no
Incentive Stock Option granted to an employee who is a Substantial Shareholder
at the time of the grant of such Option shall be exercisable by its terms after
the expiration of (5) years from the date of grant of such Option.


 


(d)                                 Limitation on Exercise and Transfer of Stock
Options.  Only the key employee to whom a Stock Option
is granted may exercise such Option, except where a guardian or other legal
representative has been duly appointed for such employee, and except as
otherwise provided in the case of such employee’s death.  No Stock Option granted hereunder shall be
transferable by an optionee other than by will or the laws of descent and
distribution.  No Stock Option granted
hereunder may be pledged or hypothecated, nor shall any such Option be subject
to execution, attachment or similar process.


 


(e)                                  Employment, Holding Period Requirements For
Certain Options.  The Committee may condition any Stock Option
granted hereunder upon the continued employment of the optionee by the Company
or by a subsidiary corporation, and may make any such Stock Option immediately
exercisable.  However, the Committee will
require that, from and after the date of grant of any Incentive Stock Option
granted hereunder until the day three (3) months prior to the date such Option
is exercised, such optionee must be an employee of the Company or of a
subsidiary corporation, but always subject to the right of the Company or any
such subsidiary corporation to terminate such optionee’s employment during such
period.  Each Stock Option shall be
subject to such additional restrictions as to the time and method of exercise
as shall be prescribed by the Committee. 
Upon completion of such requirements, if any, a Stock Option or the
appropriate portion thereof may be exercised in whole or in part from time to
time during the option period; however, such exercise right(s) shall be limited
to whole shares.


 


(f)                                    Payment for Stock Option Price.  A Stock
Option shall be exercised by an optionee giving written notice to the Company
of his intention to exercise the same, accompanied by full payment of the
purchase price in cash or by check.  The
Committee may, in its sole discretion, approve other methods of exercise for a
Stock Option or payment of the option price, provided that no such method shall
cause any option granted under the Plan as an Incentive Stock Option to not
qualify under Section 422 of the Code, or cause any Common Share issued in
connection with the exercise of an option not to be a fully paid and
non-assessable Common Share.


 


(g)                                 Certain Reissuances of Stock Options.  To the
extent Common Shares are surrendered by an optionee in connection with the
exercise of a Stock Option in accordance with Section 7(f), the Committee may
in its sole discretion grant new Stock Options to such optionee (to the extent
Common Shares remain available for grants), subject to the following terms and
conditions:


 


(i)                                     The number of Common Shares shall be equal to the
number of Common Shares being surrendered by the optionee;


 


(ii)                                  The option price per Common Share shall be equal
to the fair market value of Common Shares, determined on the date of exercise
of the Stock Options whose exercise caused such Grant; and


 


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(iii)                               The terms and conditions of such Stock Options
shall in all other respects replicate such terms and conditions of the Stock
Options whose exercise caused such Grant, except to the extent such terms and
conditions are determined to not be wholly consistent with the general
provisions of this Section 7, or in conflict with the remaining provisions of
this Plan.


 


(h)                                 Limitation on Exercisable Incentive Stock Options.  The
aggregate fair market value of the Common Shares first becoming subject to
exercise as Incentive Stock Options by a key employee during any given calendar
year shall not exceed the sum of One Hundred Thousand Dollars ($100,000).  Such aggregate fair market value shall be
determined as of the date such Option is granted, taking into account, in the
order in which granted, any other incentive stock options granted by the
Company, or by a parent or subsidiary thereof.


 


7.                                       Termination of Employment.  If a key
employee ceases to be an employee of the Company and every subsidiary
corporation, for a reason other than death, retirement, or permanent and total
disability, his Stock Options shall, unless extended by the Committee on or
before his date of termination of employment, terminate on the effective date
of such termination of employment. 
Neither the key employee nor any other person shall have any right after
such date to exercise all or any part of his Stock Options.


 


If termination of employment is due to death
or permanent and total disability, then outstanding Stock Options may be
exercised within the one (1) year period ending on the anniversary of such
death or permanent and total disability. 
In the case of death, such outstanding Stock Options shall be exercised
by such key employee’s estate, or the person designated by such key employee by
will, or as otherwise designated by the laws of descent and distribution.   Notwithstanding the foregoing, in no event
shall any Stock Option be exercisable after the expiration of the option
period, and in the case of exercises made after a key employee’s death, not to
any greater extent than the key employee would have been entitled to exercise
such Option at the time of his death.


 


Subject to the discretion of the Committee,
in the event a key employee terminates employment with the Company and all
subsidiary corporations because of normal or early retirement, any
then-outstanding Stock Options held by such key employee shall lapse at the
earlier of the end of the term of such Stock Option or three (3) months after
such retirement or permanent and total disability.


 


  In
the event an employee of the Company or one of its subsidiary corporations is
granted a leave of absence by the Company or such subsidiary corporation to
enter military service or because of sickness, his employment with the Company
or such subsidiary corporation shall not be considered terminated, and he shall
be deemed an employee of the Company or such subsidiary corporation during such
leave of absence or any extension thereof granted by the Company or such
subsidiary corporation.


 


8.                                       Change of Control.  Upon the
occurrence of a Change of Control (as defined below), notwithstanding any other
provisions hereof or of any agreement to the contrary, all Stock Options
granted under this Plan shall become immediately exercisable in full.


 


For purposes of this Plan, a Change of
Control shall be deemed to have occurred if: 
(i) a tender offer shall be made and consummated for the ownership of
25% or more of the outstanding voting securities of the Company; (ii) the
Company shall be merged or consolidated with another corporation and, as a
result of such merger or consolidation, less than 75% of the outstanding voting
securities of the surviving or resulting corporation shall be owned in the
aggregate by the former stockholders of the Company as the same shall have
existed immediately prior to such merger or consolidation; or (iii) the Company
shall sell substantially all of its assets to another corporation which is not
a wholly owned subsidiary; or (iv) a person, within the meaning of Section
3(a)(9) or of Section 13(d)(3) (as in effect on the date hereof) of the
Exchange Act, shall acquire, other than by reason of inheritance, fifty-one
percent (51%) or more of the outstanding voting securities of the Company
(whether directly, indirectly, beneficially or of record).  In making any such determination, transfers
made by a person to an affiliate of such person (as determined by the Board of
Directors of the Company), whether by gift, devise or otherwise, shall not be
taken into account.  For purposes of this
Plan, ownership of voting securities shall take into account and shall include
ownership as determined by applying the provisions of Rule 13d-3(d)(1)(i)
as in effect on the date hereof pursuant to the Exchange Act.


 


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Notwithstanding the provisions of
subparagraph (iv) of this Section 8, “person” is used in that subparagraph
shall not include any holder who was the beneficial owner of more than ten
percent (10%) of the voting securities of the Company on the date the Plan was
adopted by the Board of Directors.


 


9.                                       Amendments to Plan.  The
Committee is authorized to interpret this Plan and from time to time adopt any
rules and regulations for carrying out this Plan that it may deem
advisable.  Subject to the approval of
the Board of Directors of the Company, the Committee may at any time amend,
modify, suspend or terminate this Plan. 
In no event, however, without the approval of stockholders, shall any
action of the Committee or the Board of Directors result in:


 


(a)                                  Materially amending, modifying or altering the
eligibility requirements provided in Section 4 hereof; or


 


(b)                                 Materially increasing, except as provided in
Section 5 and 6 hereof, the maximum number of shares subject to Stock Options;


 


except to conform this Plan and any
agreements made hereunder to changes in the Code or governing law.


 


10.                                 Investment Representation, Approvals and Listing.  The Committee
may, if it deems appropriate, condition its grant of any Stock Option hereunder
upon receipt of the following investment representation from the optionee:


 


“I agree that any Common Shares of Uranium
Resources, Inc., which I may acquire by virtue of this Stock Option shall be
acquired for investment purposes only and not with a view to distribution or
resale, and may not be transferred, sold, assigned, pledged, hypothecated or
otherwise disposed of by me unless (i) a registration statement or post-effective
amendment to a registration statement under the Securities Act of 1933, as
amended, with respect to said Common Shares has become effective so as to
permit the sale or other disposition of said shares by me; or (ii) there is
presented to Uranium Resources, Inc., an opinion of counsel satisfactory to
Uranium Resources, Inc., to the effect that the sale or other proposed
disposition of said Common Shares by me may lawfully be made otherwise than
pursuant to an effective registration statement or post-effective amendment to
a registration statement relating to the said shares under the Securities Act
of 1933, as amended.”


 


The Company shall not be required to issue
any certificate or certificates for Common Shares upon the exercise of any
Stock Option granted under this Plan prior to (i) the obtaining of any approval
from any governmental agency which the Committee shall, in its sole discretion,
determine to be necessary or advisable; (ii) the admission of such shares to
listing on any national securities exchange on which the Common Shares may be
listed; (iii) the completion of any registration or other qualifications of the
Common Shares under any state or federal law or ruling or regulations of any
governmental body which the Committee shall, in its sole discretion, determine
to be necessary or advisable or the determination by the Committee, in its sole
discretion, that any registration or other qualification of the Common Shares
is not necessary or advisable; and (iv) the obtaining of an investment representation
from the optionee in the form stated above or in such other form as the
Committee, in its sole discretion, shall determine to be adequate.


 


11.                                 General Provisions.  The form
and substance of Stock Option agreements made hereunder, whether granted at the
same or different times, need not be identical. 
Nothing in this Plan or in any agreement shall confer upon any employee
any right to continue in the employ of the Company or any of its subsidiary
corporations, to be entitled to any remuneration or benefits not set forth in
this Plan or such Grant, or to interfere with or limit the right of the Company
or any subsidiary corporation to terminate his employment at any time, with or
without cause.  Nothing contained in this
Plan or in any Stock Option agreement shall be construed as entitling any
optionee to any rights of a stockholder as a result of the grant of a Stock
Option, until such time as Common Shares are actually issued to such optionee
pursuant to the exercise of such Option. 
This Plan may be assumed by the successors and assigns of the
Company.  The liability of the Company
under this Plan and any sale made hereunder is limited to the obligations set
forth herein with respect to such sale and no term or provision of this Plan
shall be construed to impose any liability on the Company in favor of any
employee with respect to any loss, cost or expense which the employee may incur
in connection with or arising out of any transaction in connection with this
Plan.  The cash proceeds received by the
Company from the issuance of Common Shares pursuant to this Plan will be used
for general corporate purposes.  The
expense of administering this Plan shall be borne by the Company.  The captions and section numbers


 


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appearing in this Plan are inserted only as a
matter of convenience.  They do not
define, limit, construe or describe the scope or intent of the provisions of
this Plan.


 


12.                                 Termination of This Plan.  This
Plan shall terminate on November 11, 2014 and thereafter no Stock Options shall
be granted hereunder.  All Stock Options
outstanding at the time of termination of this Plan shall continue in full
force and effect according to their terms and the terms and conditions of this
Plan.


 


As adopted on November 12, 2004 by the Board of Directors and approved
by the stockholders on               ,
2005.


 


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