Document:

tckm_ex103.htm

Exhibit 10.3

 

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”).

 

NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.  IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT.  “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.

STOCK OPTION AGREEMENT

(Non U.S. Persons)

 

This AGREEMENT is entered into as of the _____ day of __________, 20__ (the “Date of Grant”).

 

	BETWEEN:	TECKMINE INDUSTRIES, INC., a company incorporated pursuant to the laws of the State of Nevada, with an office at 1880 Airport Drive, Ball Ground, Georgia  30107	 
	 	 	 
	 	(the “Company”)	 
	 	 	 
	AND:	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	(the “Optionee”)	 
	 	 	 
	WHEREAS:	 	 
	 	 	 
	A. 	The Company’s board of directors (the “Board”) has approved and adopted a 2013 Stock Option Plan (the “Plan”) whereby the Board is authorized to grant stock options to purchase shares of common stock of the Company to the directors, officers, employees and consultants of the Company and its subsidiaries;
	 	 	 
	B.	The Optionee is a director, officer, employee or consultant of the Company or subsidiary of the Company; and
	 	 	 
	C.	The Company wishes to grant stock options to purchase a total of __________ Optioned Shares (as defined herein) to the Optionee, as follows:

 

	  	
 Incentive Stock Options

	
X

	
 Non Qualified Stock Options

 

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

  

1

  

 

	
1.  

	
DEFINITIONS

 

1.1 In this Agreement, the following terms shall have the following meanings:

 

	
(a)  

	
“Common Stock” means the shares of common stock of the Company;

 

	
(b)  

	
“Exercise Price” means $_____ per share;

 

	
(c)  

	
“Expiry Date” means _______________, 201__;

 

	
(d)  

	
“Notice of Exercise” means a notice in writing addressed to the Company at its address first recited hereto (or such other address of which the Company may from time to time notify the Optionee in writing), substantially in the form attached as Schedule “B” hereto, which notice shall specify therein the number of Optioned Shares in respect of which the Options are being exercised;

 

	
(e)  

	
“Options” means the irrevocable right and option to purchase, from time to time, all, or any part of the Optioned Shares granted to the Optionee by the Company pursuant to Section 2.1 of this Agreement;

 

	
(f)  

	
“Optioned Shares” means the shares of Common Stock that are issued pursuant to the exercise of the Options;

 

	
(g)  

	
“Securities” means, collectively, the Options and the Optioned Shares;

 

	
(h)  

	
“Shareholders” means holders of record of the shares of Common Stock;

 

	
(i)  

	
“U.S. Person” shall have the meaning ascribed thereto in Regulation S under the 1933 Act, and for the purpose of the Agreement includes any person in the United States; and

 

	
(j)  

	
“Vested Options” means the Options that have vested in accordance with Section 2.2 of this Agreement.

 

1.2 Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Plan.

 

	
2.  

	
THE OPTIONS

 

2.1 The Company hereby grants to the Optionee, on the terms and conditions set out in this Agreement and in the Plan, Options to purchase a total of __________ Optioned Shares at the Exercise Price.

 

2.2 The Options vest in accordance with Schedule “A” to this Agreement.  The Options may be exercised immediately after vesting.

 

2.3 The Options shall, at 5:00 p.m. (Pacific time) on the Expiry Date, expire and be of no further force or effect whatsoever.

 

2.4 The Company shall not be obligated to cause the issuance, transfer or delivery of a certificate or certificates representing Optioned Shares to the Optionee, until provision has been made by the Optionee, to the satisfaction of the Company, for the payment of the aggregate Exercise Price for all Optioned Shares for which the Options shall have been exercised, and for satisfaction of any tax withholding obligations associated with such exercise.

 

  

2

  

2.5 The Optionee shall have no rights whatsoever as a shareholder in respect of any of the Optioned Shares (including any right to receive dividends or other distribution therefrom or thereon) except in respect of which the Options have been properly exercised in accordance with the terms of this Agreement.

 

2.6 The Options will terminate in accordance with the provisions of the Plan.

 

2.7 Subject to the provisions of this Agreement and the Plan and subject to compliance with any applicable securities laws, the Options shall be exercisable, in full or in part, at any time after vesting, until termination; provided, however, that if the Optionee is subject to the reporting and liability provisions of Section 16 of the Securities Exchange Act of 1934 with respect to the Common Stock, the Optionee shall be precluded from selling, transferring or otherwise disposing of any Common Stock underlying any of the Options during the six months immediately following the grant of the Options.  If less than all of the shares included in the vested portion of any Options are purchased, the remainder may be purchased at any subsequent time prior to the Expiry Date.  Only whole shares may be issued pursuant to the exercise of any Options, and to the extent that any Option covers less than one (1) share, it is not exercisable.

 

2.8 Each exercise of the Options shall be by means of delivery of a Notice of Exercise (which may be in the form attached hereto as Schedule “B”) to the President of the Company at its principal executive office, specifying the number of Optioned Shares to be purchased and accompanied by payment in cash or by certified check or cashier’s check in the amount of the full Exercise Price for the Common Stock to be purchased.  In addition to payment in cash or by certified check or cashier’s check and if agreed to in advance by the Company, the Optionee or transferee of the Options may pay for all or any portion of the aggregate Exercise Price by complying with one or more of the following alternatives:

 

	
(a)  

	
by delivering to the Company shares of Common Stock previously held by the Optionee, or by the Company withholding shares of Common Stock otherwise deliverable pursuant to the exercise of the Options, which shares of Common Stock received or withheld shall have a fair market value at the date of exercise (as determined by the Board) equal to the aggregate exercise price to be paid by the Optionee upon such exercise; or

 

	
(a)  

	
by complying with any other payment mechanism approved by the Board at the time of exercise.

 

2.9 It is a condition precedent to the issuance of Optioned Shares that the Optionee execute and/or deliver to the Company all documents and withholding taxes required in accordance with applicable laws.

 

2.10 Nothing in this Agreement shall obligate the Optionee to purchase any Optioned Shares except those Optioned Shares in respect of which the Optionee shall have exercised the Options in the manner provided in this Agreement or the Plan.

 

2.11 Reference is made to the Plan for particulars of the rights and obligations of the Optionee and the Company in respect of:

 

	
(a)  

	
the terms and conditions on which the Options are granted; and,

 

	
(b)  

	
a consolidation or subdivision of the Company’s share capital or an amalgamation or merger;

 

all to the same effect as if the provisions of the Plan were set out in this Agreement and to all of which the Optionee assents.

 

2.12 By accepting the Options, the Optionee represents and agrees that none of the Optioned Shares purchased upon exercise of the Options will be distributed in violation of applicable federal and state laws and regulations.  The Optionee further represents and agrees to provide the Company with any other document reasonably requested by the Company or the Company’s Counsel.

 

	
3.  

	
DOCUMENTS REQUIRED FROM OPTIONEE

 

3.1 The Optionee must complete, sign and return an executed copy of this Agreement to the Company, including a duly signed Canadian Accredited Investor Certificate attached hereto as Schedule “C”.

 

3.2 The Optionee shall complete, sign and return to the Company as soon as possible, on request by the Company, any documents, questionnaires, notices and undertakings as may be required by regulatory authorities, and applicable law.

 

	
4.  

	
SUBJECT TO STOCK OPTION PLAN

 

The terms of the Options will be subject to the Plan, as may from time to time be amended, and any inconsistencies between this Agreement and the Plan, as the same may be from time to time amended, shall be governed by the provisions of the Plan.  A copy of the Plan will be delivered to the Optionee, and will be available for inspection at the principal offices of the Company.

 

  

3

  

	
5.  

	
ACKNOWLEDGEMENTS OF THE OPTIONEE

 

The Optionee acknowledges and agrees that:

 

	
(a)  

	
none of the Options or the Optioned Shares have been registered under the 1933 Act or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons, except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case only in accordance with applicable state securities laws;

 

	
(b)  

	
the Company has not undertaken, and will have no obligation, to register any of the Securities under the 1933 Act;

 

	
(c)  

	
the decision to execute this Agreement and acquire the Securities hereunder has not been based upon any oral or written representation as to fact or otherwise made by or on behalf of the Company and such decision is based solely upon a review of publicly available information regarding the Company that is available on the website of the United States Securities and Exchange Commission (the “SEC”) at www.sec.gov (the “Company Information”);

 

	
(d)  

	
no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities;

 

	
(e)  

	
there is no government or other insurance covering the Securities;

 

	
(f)  

	
there are risks associated with an investment in the Securities;

 

	
(g)  

	
the Optionee and the Optionee’s advisor(s) (if applicable) have had a reasonable opportunity to ask questions of and receive answers from the Company in connection with the distribution of the Securities hereunder, and to obtain additional information, to the extent possessed or obtainable without unreasonable effort or expense, necessary to verify the accuracy of the information about the Company;

 

	
(h)  

	
the books and records of the Company were available upon reasonable notice for inspection, subject to certain confidentiality restrictions, by the Optionee during reasonable business hours at its principal place of business, and all documents, records and books in connection with the distribution of the Securities hereunder have been made available for inspection by the Optionee, the Optionee’s attorney and/or advisor(s) (if applicable);

 

	
(i)  

	
the Company and others are entitled to rely upon the truth and accuracy of the acknowledgements, representations, warranties, statements, covenants and agreements contained in this Agreement and agrees that if any of such acknowledgements, representations, warranties, statements, covenants, and agreements are no longer accurate or have been breached, the Optionee shall promptly notify the Company, and the Optionee will hold harmless the Company from any loss or damage it may suffer as a result of the Optionee’s failure to correctly complete this Agreement;

 

	
(j)  

	
the Company has advised the Optionee that the Company is relying on an exemption from the registration and prospectus requirements of applicable securities laws and, as a consequence of acquiring the Securities pursuant to this exemption, certain protections, rights and remedies provided by the applicable securities laws, including statutory rights of rescission or damages, will not be available to the Optionee;

 

	
(k)  

	
the Optionee will indemnify and hold harmless the Company and, where applicable, its directors, officers, employees, agents, advisors and shareholders, from and against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all fees, costs and expenses whatsoever reasonably incurred in investigating, preparing or defending against any claim, lawsuit, administrative proceeding or investigation whether commenced or threatened) arising out of or based upon any representation or warranty of the Optionee contained herein or in any document furnished by the Optionee to the Company in connection herewith being untrue in any material respect or any breach or failure by the Optionee to comply with any covenant or agreement made by the Optionee to the Company in connection therewith;

 

	
(l)  

	
none of the Securities are listed on any stock exchange or automated dealer quotation system and no representation has been made to the Optionee that any of the Securities will become listed on any stock exchange or automated dealer quotation system; except that currently certain market makers make market in the Common Stock on the OTC Bulletin Board;

 

	
(m)  

	
in addition to resale restrictions imposed under U.S. securities laws, there are additional restrictions on the Optionee’s ability to resell the Securities under Canadian securities laws and National Instrument 45-106 as adopted by the Canadian Securities Administrators;

 

	
(n)  

	
the Company will refuse to register any transfer of the Securities not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act and in accordance with applicable state and provincial securities laws;

 

  

4

  

	
(o)  

	
the statutory and regulatory basis for the exemption claimed for the offer of the Securities, although in technical compliance with Regulation S, would not be available if the offering is part of a plan or scheme to evade the registration provisions of the 1933 Act or any applicable state and provincial securities laws;

 

	
(p)  

	
the Optionee has been advised to consult the Optionee’s own legal, tax and other advisors with respect to the merits and risks of an investment in the Securities and with respect to applicable resale restrictions, and it is solely responsible (and the Company is not in any way responsible) for compliance with:

 

	
(i)  

	
any applicable laws of the jurisdiction in which the Optionee is resident in connection with the distribution of the Securities hereunder, and

 

	
(ii)  

	
applicable resale restrictions; and

 

	
(q)  

	
this Agreement is not enforceable by the Optionee unless it has been accepted by the Company.

 

	
6.  

	
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE OPTIONEE

 

The Optionee hereby represents and warrants to and covenants with the Company (which representations, warranties and covenants shall survive the closing) that:

 

	
(a)  

	
the Optionee is a director, officer, employee or consultant of the Company or subsidiary of the Company;

 

	
(b)  

	
if an employee or consultant of the Company or subsidiary of the Company, the Optionee is a bona fide employee or consultant of the Company or subsidiary of the Company;

 

	
(c)  

	
the Optionee has the legal capacity and competence to enter into and execute this Agreement and to take all actions required pursuant hereto;

 

	
(d)  

	
the Optionee has received and carefully read this Agreement and the Company Information;

 

	
(e)  

	
the Optionee has duly executed and delivered this Agreement and it constitutes a valid and binding agreement of the Optionee enforceable against the Optionee in accordance with its terms;

 

	
(f)  

	
the Optionee is not acquiring the Securities for the account or benefit of, directly or indirectly, any U.S. Person;

 

	
(g)  

	
the Optionee is not a U.S. Person;

 

	
(h)  

	
the Optionee is resident in the jurisdiction set out on page 1 of this Agreement;

 

	
(i)  

	
the Optionee:

 

	
(i)  

	
is knowledgeable of, or has been independently advised as to, the applicable securities laws of the securities regulators having application in the jurisdiction in which the Optionee is resident (the “International Jurisdiction”) which would apply to the granting of the Option;

 

	
(ii)  

	
the Optionee is acquiring the Option pursuant to exemptions from prospectus or equivalent requirements under applicable securities laws or, if such is not applicable, the Optionee is permitted to acquiring the Option under the applicable securities laws of the securities regulators in the International Jurisdiction without the need to rely on any exemptions;

 

  

5

  

	
(iii)  

	
the applicable securities laws of the authorities in the International Jurisdiction do not require the Company to make any filings or seek any approvals of any kind whatsoever from any securities regulator of any kind whatsoever in the International Jurisdiction in connection with the granting of the Option; and

 

	
(iv)  

	
the granting of the Option by the Company does not trigger:

 

	
A.  

	
any obligation to prepare and file a prospectus or similar document, or any other report with respect to such purchase in the International Jurisdiction; or

 

	
B.  

	
any continuous disclosure reporting obligation of the Optionee or the Company in the International Jurisdiction; and

 

	
(v)  

	
the Optionee will, if requested by the Company, deliver to the Company a certificate or opinion of local counsel from the International Jurisdiction which will confirm the matters referred to in subparagraphs (ii), (iii) and (iv) above to the satisfaction of the Company, acting reasonably;

 

	
(j)  

	
the acquisition of the Securities by the Optionee as contemplated in this Agreement complies with or is exempt from the applicable securities legislation of the jurisdiction of residence of the Optionee;

 

	
(k)  

	
the Optionee has not acquired the Securities as a result of, and will not itself engage in, any “directed selling efforts” (as defined in Regulation S under the 1933 Act) in the United States in respect of the Securities which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of the Securities; provided, however, that the Optionee may sell or otherwise dispose of the Securities pursuant to registration thereof under the 1933 Act and any applicable state and provincial securities laws or under an exemption from such registration requirements;

 

	
(l)  

	
the Optionee is outside the United States when receiving and executing this Agreement and is acquiring the Securities as principal for the Optionee’s own account, for investment purposes only, and not with a view to, or for, resale, distribution or fractionalisation thereof, in whole or in part, and, in particular, it has no intention to distribute either directly or indirectly any of the Securities in the United States or to U.S. Persons, and no other person has a direct or indirect beneficial interest in such Securities;

 

	
(m)  

	
the Optionee is not an underwriter of, or dealer in, the Common Stock, nor is the Optionee participating, pursuant to a contractual agreement or otherwise, in the distribution of the Securities;

 

	
(n)  

	
the Optionee (i) has adequate net worth and means of providing for his/her/its current financial needs and possible personal contingencies, (ii) has no need for liquidity in this investment, and (iii) is able to bear the economic risks of an investment in the Securities for an indefinite period of time, and can afford the complete loss of such investment;

 

	
(o)  

	
the Optionee is aware that an investment in the Company is speculative and involves certain risks, including the possible loss of the investment, and the Optionee has carefully read and considered the matters set forth under the caption “Risk Factors” appearing in the Company’s various disclosure documents, filed with the SEC;

 

	
(p)  

	
the Optionee has the requisite knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the investment in the Securities and the Company;

 

	
(q)  

	
the Optionee understands and agrees that the Company and others will rely upon the truth and accuracy of the acknowledgements, representations and agreements contained in this Agreement, and agrees that if any of such acknowledgements, representations and agreements are no longer accurate or have been breached, the Optionee shall promptly notify the Company;

 

	
(r)  

	
the Optionee has made an independent examination and investigation of an investment in the Securities and the Company and has depended on the advice of its legal and financial advisors and agrees that the Company will not be responsible in anyway whatsoever for the Optionee’s decision to invest in the Securities and the Company;

 

	
(s)  

	
the Optionee understands and agrees that none of the Options or the Optioned Shares have been or will be registered under the 1933 Act, or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case only in accordance with applicable state securities laws;

 

  

6

  

	
(t)  

	
the Optionee understands and agrees that the Company will refuse to register any transfer of the Optioned Shares not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act;

 

	
(u)  

	
the Optionee is not aware of any advertisement of any of the Securities and is not acquiring the Securities as a result of any form of general solicitation or general advertising including advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or broadcast over radio or television, or any seminar or meeting whose attendees have been invited by general solicitation or general advertising;

 

	
(v)  

	
no person has made to the Optionee any written or oral representations:

 

	
(i)  

	
that any person will resell or repurchase any of the Securities;

 

	
(ii)  

	
that any person will refund the purchase price of any of the Securities; or

 

	
(iii)  

	
as to the future price or value of any of the Securities; and

 

	
(w)  

	
if the Optionee is a consultant of the Company, the Optionee has entered into a written consulting agreement with the Company or a related entity of the Company and spends or will spend a significant amount of time and attention on the affairs and business of the Company or such related entity.

 

	
7.  

	
ACKNOWLEDGEMENT AND WAIVER

 

The Optionee has acknowledged that the decision to purchase the Securities was solely made on the basis of publicly available information contained in the Company Information.  The Optionee hereby waives, to the fullest extent permitted by law, any rights of withdrawal, rescission or compensation for damages to which the Optionee might be entitled in connection with the distribution of any of the Securities.

 

	
8.  

	
PROFESSIONAL ADVICE

 

The acceptance of the Options and the sale of Common Stock issued pursuant to the exercise of Options may have consequences under federal, state and foreign tax and securities laws which may vary depending upon the individual circumstances of the Optionee.  Accordingly, the Optionee acknowledges that he or she has been advised to consult his or her personal legal and tax advisor in connection with this Agreement and his or her dealings with respect to Options.  Without limiting other matters to be considered with the assistance of the Optionee’s professional advisors, the Optionee should consider: (a) the merits and risks of an investment in the underlying Optioned Shares; and (b) any resale restrictions that might apply under applicable securities laws.

 

	
9.  

	
LEGENDING OF SUBJECT SECURITIES

 

9.1 The Optionee hereby acknowledges that that upon the issuance thereof, and until such time as the same is no longer required under the applicable securities laws and regulations, the certificates representing any of the Securities will bear any legends required under applicable Canadian securities laws and regulations and a legend in substantially the following form:

 

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”).

 

NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.  IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.

 

9.2 The Optionee hereby acknowledges and agrees to the Company making a notation on its records or giving instructions to the registrar and transfer agent of the Company in order to implement the restrictions on transfer set forth and described in this Agreement.

 

  

7

  

	
10.  

	
CANADIAN RESALE RESTRICTION

 

10.1 The Optioneee acknowledges that the Optioned Shares are subject to resale restrictions in Canada and may not be traded in Canada except as permitted by the applicable securities act and the rules made thereunder.

 

10.2 Pursuant to National Instrument 45-102, a subsequent trade in the Optioned Shares will be a distribution subject to the prospectus and registration requirements of applicable Canadian securities legislation unless certain conditions are met, which conditions include a hold period (the “Canadian Hold Period”) that shall have elapsed from the date on which the Optioned Shares were issued to the Optionee and, during the currency of the Canadian Hold Period, any certificate representing the Optioned Shares is to be imprinted with a restrictive legend (the “Canadian Legend”).

 

10.3 By executing and delivering this Option Agreement, the Optionee will have directed the Company not to include the Canadian Legend on any certificates representing the Optioned Shares to be issued to the Optionee.

 

10.4 As a consequence, the Optionee will not be able to rely on the resale provisions of National Instrument 45-102, and any subsequent trade in any of the Optioned Shares during or after the Canadian Hold Period will be a distribution subject to the prospectus and registration requirements of Canadian securities legislation, to the extent that the trade is at that time subject to any such Canadian securities legislation.

 

	
11.  

	
GENERAL RESALE RESTRICTIONS

 

11.1 The Optionee acknowledges that any resale of any of the Optioned Shares will be subject to resale restrictions contained in the securities legislation applicable to the Optionee or proposed transferee.  The Optionee acknowledges that none of the Optioned Shares have been registered under the 1933 Act or the securities laws of any state of the United States.  The Optioned Shares may not be offered or sold in the United States unless registered in accordance with federal securities laws and all applicable state securities laws or exemptions from such registration requirements are available.

 

11.2 The Optionee acknowledges and agrees that the Optionee is solely responsible (and the Company is not in any way responsible) for compliance with applicable resale restrictions.

 

11.3 The Optionee acknowledges that the Optioned Shares are subject to resale restrictions in Canada and may not be traded in Canada except as permitted by the applicable provincial securities laws and the rules made thereunder.

 

	
12.  

	
NO EMPLOYMENT RELATIONSHIP

 

The grant of an Option shall in no way constitute any form of agreement or understanding binding on the Company or any related company, express or implied, that the Company or any related company will employ or contract with an Optionee, for any length of time, nor shall it interfere in any way with the Company’s or, where applicable, a related company’s right to terminate Optionee’s employment at any time, which right is hereby reserved.

 

	
13.  

	
GOVERNING LAW

 

This Agreement is governed by the laws of the State of Nevada and the federal laws of the United States of America as applicable therein.

 

	
14.  

	
COSTS

 

The Optionee acknowledges and agrees that all costs and expenses incurred by the Optionee (including any fees and disbursements of any special counsel retained by the Optionee) relating to the acquisition of the Securities shall be borne by the Optionee.

 

	
15.  

	
SURVIVAL

 

This Agreement, including without limitation the representations, warranties and covenants contained herein, shall survive and continue in full force and effect and be binding upon the parties hereto notwithstanding the completion of the purchase of the shares underlying the Options by the Optionee pursuant hereto.

 

  

8

  

	
16.  

	
ASSIGNMENT

 

This Agreement is not transferable or assignable.

 

	
17.  

	
CURRENCY

 

Unless explicitly stated otherwise, all funds in this Agreement are stated in United States dollars.

 

	
18.  

	
SEVERABILITY

 

The invalidity or unenforceability of any particular provision of this Agreement shall not affect or limit the validity or enforceability of the remaining provisions of this Agreement.

 

	
19.  

	
COUNTERPARTS AND ELECTRONIC MEANS

 

This Agreement may be executed in several counterparts, each of which will be deemed to be an original and all of which will together constitute one and the same instrument.  Delivery of an executed copy of this Agreement by electronic facsimile transmission or other means of electronic communication capable of producing a printed copy will be deemed to be execution and delivery of this Agreement as of the date first above written.

 

	
20.  

	
ENTIRE AGREEMENT

 

This Agreement is the only agreement between the Optionee and the Company with respect to the Options, and this Agreement and the Plan, once approved, supersede all prior and contemporaneous oral and written statements and representations and contain the entire agreement between the parties with respect to the Options.

 

  

9

  

 

IN WITNESS WHEREOF the parties hereto have duly executed this Agreement as of the date first above written.

 

TECKMINE INDUSTRIES, INC.

 

	Per: 	 	 
	 	Authorized Signatory	 

 

	

WITNESSED BY:

	)	 	 
	 	)	 	 
	 	)	 	 
	 	)	 	 
	Name	)	 	 
	 	)	

OPTIONEE

	 
	Address	)	 	 
	 	)	 	 
	 	)	 	 
	 	)	 	 
	Occupation	)	 	 

 

 

 

  

10

  

SCHEDULE “A”

 

VESTING SCHEDULE

 

 

  

11

  

 

SCHEDULE “B”

NOTICE OF EXERCISE

 

TO:          Teckmine Industries, Inc.

1880 Airport Drive

Ball Ground, Georgia  30107

 

This Notice of Exercise shall constitute a proper Notice of Exercise pursuant to section 2.8 of the Stock Option Agreement dated June 25, 2013 (the “Agreement”), between Teckmine Industries, Inc. (the “Company”) and the undersigned.  The undersigned hereby elects to exercise the Optionee’s options to purchase ____________________ shares of the common stock of the Company at a price of US $_____ per share, for aggregate consideration of US $____________, on the terms and conditions set forth in the Agreement.  Such aggregate consideration, in the form specified in section 2.8 of the Agreement, accompanies this notice.

 

The Optionee represents and warrants to the Company that all representations and warranties set out in the Agreement are true as of the date of the exercise of the options under the Agreement.

 

The Optionee hereby directs the Company to issue, register and deliver the certificates representing the shares as follows:

	
Registration Information:

	  	
Delivery Instructions:

	  	  	  
	
Name to appear on certificates

	  	
Name

	  	  	  
	
Address

	  	
Address

	  	  	  
	
City, State, and Zip Code

	  	  
	  	  	  
	  	  	
Telephone Number

 

DATED at _____________________________, the _______ day of______________, _______.

 

	
X

	
Signature

	  
	
(Name and, if applicable, Office)

	  
	
(Address)

	  
	
(City, State, and Zip Code)

	  
	
Fax Number or E-mail Address

	  
	
Social Security/Insurance No.:

  

12

  

 

SCHEDULE “C”

CANADIAN ACCREDITED INVESTOR CERTIFICATE

In connection with the grant of the Options in accordance with the Stock Option Agreement dated __________, 20__ between Teckmine Industries, Inc. and the undersigned, the undersigned represents and warrants to Teckmine Industries, Inc. that the undersigned satisfies one or more of the categories indicated below (please place an “X” on the appropriate lines):

	
______Category 1

	
a Canadian financial institution, or a Schedule III bank

	
______Category 2

	
the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada)

	
______Category 3

	
a subsidiary of any person referred to in Category 1 or 2, if the person owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary

	
______Category 4

	
a person registered under the securities legislation of a jurisdiction of Canada as an adviser or dealer, other than a person registered solely as a limited market dealer under one or both of the Securities Act (Ontario) or the Securities Act (Newfoundland and Labrador)

	
______Category 5

	
an individual registered or formerly registered under the securities legislation of a jurisdiction of Canada as a representative of a person referred to in Category 4

	
______Category 6

	
the Government of Canada or a jurisdiction of Canada, or any crown corporation, agency or wholly owned entity of the Government of Canada or a jurisdiction of Canada

	
______Category 7

	
a municipality, public board or commission in Canada and a metropolitan community, school board, the Comité de gestion de la taxe scolaire de l’ile de Montreal or an intermunicipal management board in Québec

	
______Category 8

	
any national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency of that government

	
______Category 9

	
a pension fund that is regulated by the Office of the Superintendent of Financial Institutions (Canada) a pension commission or similar regulatory authority of a jurisdiction of Canada

	
_____Category 10

	
an individual who, either alone or with a spouse, beneficially owns financial assets having an aggregate realizable value that before taxes, but net of any related liabilities, exceeds $1,000,000

	
_____Category 11

	
an individual whose net income before taxes exceeded $200,000 in each of the two (2) most recent calendar years or whose net income before taxes combined with that of a spouse exceeded $__________ in each of the two (2) most recent calendar years and who, in either case, reasonably expects to exceed that net income level in the current calendar year

	
_____Category 12

	
an individual who, either alone or with a spouse, has net assets of at least $5,000,000

	
_____Category 13

	
a person, other than an individual or investment fund, that has net assets of at least $5,000,000 as shown on its most recently prepared financial statements

	
_____Category 14

	
an investment fund that distributes or has distributed its securities only to

	  	
(a)           a person that is or was an accredited investor at the time of the distribution;

	  	
(b)a person that acquires or acquired securities in the circumstances referred to in sections 2.10 of National Instrument 45-106 [Minimum amount investment] or 2.19 of National Instrument 45-106 [Additional investment in investment funds]; or

	  	
(c)a person described in paragraph (a) or (b) that acquires or acquired securities under section 2.18 of National Instrument 45-106 [Investment fund reinvestment]

	
_____Category 15

	
an investment fund that distributes or has distributed securities under a prospectus in a jurisdiction of Canada for which the regulator or, in Quebec, the securities regulatory authority, has issued a receipt

	
_____Category 16

	
a trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a fully managed account managed by the trust company or trust corporation, as the case may be

	
_____Category 17

	
a person acting on behalf of a fully managed account managed by that person, if that person

	  	
(a)is registered or authorized to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada or a foreign jurisdiction; and

	  	
(b)in Ontario, is purchasing a security that is not a security of an investment fund

	
_____Category 18

	
a registered charity under the Income Tax Act (Canada) that, in regard to the trade, has obtained advice from an eligibility adviser or an adviser registered under the securities legislation of the jurisdiction of the registered charity to give advice on the securities being traded

	
_____Category 19

	
an entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in Categories 1 to 4 or Category 9 in form and function

	
_____Category 20

	
a person in respect of which all of the owners of interests, direct, indirect or beneficial, except the voting securities required by law to be owned by directors, are persons that are accredited investors

	
_____Category 21

	
an investment fund that is advised by a person registered as an adviser or a person that is exempt from registration as an adviser

	
_____Category 22

	
a person that is recognized or designated by the securities regulatory authority or, except in Ontario and Québec, the regulator as an accredited investor.

 

Dated _______________, 20__.

 

	  	
If an Individual:                                               

	 
	 	 	 
	 	X 	 
	 	Signature	 
	 	 	 
	 	Print Name	 
	 	 	 
	 	Jurisdiction of Residence	 

 

  

13

  

For the purposes hereof:

 

  

 

	 	(a)	“accredited investor” means a person who meets the criteria in any of the above categories;
	 	 	 	 	 
	 	(b)	“Canadian financial institution” means:
	 	 	 	 	 
	 	 	(i)	an association governed by the Cooperative Credit Associations Act (Canada) or a central cooperative credit society for which an order has been made under section 473(1) of that Act; or
	 	 	 	 	 
	 	 	(ii)	a bank, loan corporation, trust company, trust corporation, insurance company, treasury branch, credit union, caisse populaire, financial services cooperative, or league that, in each case, is authorized by an enactment of Canada or a jurisdiction of Canada to carry on business in Canada or a jurisdiction of Canada;
	 	 	 	 	 
	 	(c)	“eligibility adviser” means
	 	 	 	 	 
	 	 	(i)	a person that is registered as an investment dealer and authorized to give advice with respect to the type of security being distributed; and
	 	 	 	 	 
	 	 	(ii)	in Saskatchewan or Manitoba, also means a lawyer who is a practicing member in good standing with a law society of a jurisdiction of Canada or a public accountant who is a member in good standing of an institute or association of chartered accountants, certified general accountants or certified management accountants in a jurisdiction of Canada provided that the lawyer or public accountant must not:
	 	 	 	 	 
	 	 	 	(A)	have a professional, business or personal relationship with the issuer, or any of its directors, executive officers, founders or control persons, and
	 	 	 	 	 
	 	 	 	
(B)

	have acted for or been retained personally or otherwise as an employee, executive officer, director, associate or partner of a person that has acted for or been retained by the issuer or any of its directors, executive officers, founders or control persons within the previous 12 months;
	 	 	 	 	 
	 	(d)	“financial assets” means
	 	 	 	 	 
	 	 	(i)	cash,
	 	 	 	 	 
	 	 	(ii)	securities, or
	 	 	 	 	 
	 	 	(iii)	a contract of insurance, a deposit or an evidence of a deposit that is not a security for the purposes of securities legislation;
	 	 	 	 	 
	 	(e)	“fully managed account” means an account of a client for which a person makes the investment decisions if that person has full discretion to trade in securities for the account without requiring the client’s express consent to a transaction;
	 	 	 	 	 
	 	(f)	“investment fund” means a mutual fund or a non-redeemable investment fund, and, for great certainty in British Columbia, includes an employee venture capital corporation and a venture capital corporation as such terms are defined in National Instrument 81-106 Investment Fund Continuous Disclosure;
	 	 	 	 	 
	 	(g)	“non-redeemable investment fund” means an issuer:
	 	 	 	 	 
	 	 	(i)	whose primary purpose is to invest money provided by its securityholders;
	 	 	 	 	 
	 	 	(ii)	that does not invest

 

 

14

 

	 	 	 	 	 
	 	 	 	(A)	for the purpose of exercising or seeking to exercise control of an issuer, other than an issuer that is a mutual fund or a non-redeemable investment fund, or
	 	 	 	 	 
	 	 	 	(B)	for the purpose of being actively involved in the management of any issuer in which it invests, other than an issuer that is a mutual fund or a non-redeemable investment fund, and
	 	 	 	 	 
	 	 	(iii)	that is not a mutual fund;
	 	 	 	 	 
	 	(h)	“person” includes
	 	 	 	 	 
	 	 	(i)	an individual;
	 	 	 	 	 
	 	 	(ii)	a corporation;
	 	 	 	 	 
	 	 	(iii)	a partnership, trust, fund and an association, syndicate, organization or other organized group of persons, whether incorporated or not; and
	 	 	 	 	 
	 	 	(iv)	an individual or other person in that person’s capacity as a trustee, executor, administrator or personal or other legal representative;
	 	 	 	 	 
	 	(i)	“related liabilities” means
	 	 	 	 	 
	 	 	(i)	liabilities incurred or assumed for the purpose of financing the acquisition or ownership of financial assets, or
	 	 	 	 	 
	 	 	(ii)	liabilities that are secured by financial assets;
	 	 	 	 	 
	 	(j)	“Schedule III bank” means an authorized foreign bank named in Schedule III of the Bank Act (Canada);
	 	 	 	 	 
	 	(k)	“spouse” means, an individual who,
	 	 	 	 	 
	 	 	(i)	is married to another individual and is not living separate and apart within the meaning of the Divorce Act (Canada), from the other individual,
	 	 	 	 	 
	 	 	(ii)	is living with another individual in a marriage-like relationship, including a marriage-like relationship between individuals of the same gender, or
	 	 	 	 	 
	 	 	(iii)	in Alberta, is an individual referred to in paragraph (i) or (ii), or is an adult interdependent partner within the meaning of the Adult Interdependent Relationships Act (Alberta); and
	 	 	 	 	 
	 	(l)	“subsidiary” means an issuer that is controlled directly or indirectly by another issuer and includes a subsidiary of that subsidiary.

 

15fp0007631_ex101.htm

 

PARKERVISION, INC.

 

PERFORMANCE BONUS PLAN

 

1.      Background and Purpose.  The ParkerVision, Inc. Performance Bonus Plan (the “Plan”) is designed to motivate and reward employees of ParkerVision, Inc., a Florida corporation (the “Company”) and to further link an employee’s interests with those of the Company's by creating a direct relationship between key company performance measurements and individual bonus payouts.

 

2.      Definitions. The following terms shall have the following meanings:

 

2.1        “Affiliate” means any Person Controlling, Controlled by or under common Control with another, wherein "Control" means direct or indirect (a) ownership of more than fifty percent (50%) of the outstanding equity interests representing (i) the right to vote for members of the board of directors or other similar managing authority of a corporation, partnership, limited liability company or other entity or (ii) the right to make management decisions for such entity, or (b) power to direct or cause the direction of the management and policies of a Person through the exercise of authority as an officer, director, manager, member, partner, trustee or person performing corresponding functions.

 

2.2        "Award" means the incentive compensation granted to a Participant pursuant to and in accordance with the terms and conditions of the Plan.

 

2.3        “Board” means the board of directors of the Company.

 

2.4        “Bonus Pool” means the maximum total Award that can be paid under the Plan, contingent upon the attainment of Performance Goals with respect to a Performance Period, as determined by the Committee.

 

2.5        "Code" means the U.S. Internal Revenue Code of 1986, as amended from time to time, including any regulations or authoritative guidance promulgated thereunder and successor provisions thereto.

 

2.6        "Committee" means the Compensation Committee of the Board, or such other committee as may be appointed by the Board, which shall consist of two or more Directors, each of whom constitutes an “outside director” within the meaning of Code Section 162(m).

 

2.7        "Determination Date" means the earlier of: (a) the 90th day of the Performance Period or (b) the date as of which 25% of the Performance Period has elapsed. The Determination Date shall be a date on which the outcome of the Performance Goals is substantially uncertain.

 

  

  

  

 

2.8        “Eligible Individuals” means all employees of the Company.

 

2.9        "Participant" means as to any Performance Period, any Eligible Individual selected by the Committee to be granted an Award.

 

2.10      "Performance Goals" shall have the meaning set forth in Section 3.2 hereof.

 

2.11      "Performance Period" means the period for which performance is calculated, which unless otherwise indicated by the Committee, shall be the Plan Year.

 

2.12      “Person” means any corporation, company, group, partnership, joint venture, limited liability company, enterprise, entity or individual.

 

2.13      "Plan Year" means the Company's fiscal year, which commences on January 1st and ends on December 31st.

 

2.14      "Shares" means the shares of the Company's common stock.

 

2.15      "Target Award" means the target award potentially payable under the Plan to a Participant for a particular Performance Period.

 

3.      Terms of Awards.

 

3.1        Determination of Bonus Pool.  Prior to the Determination Date, the Committee, in its sole discretion, shall establish the formula for determining the Bonus Pool which shall be payable based upon the level of attainment of the Performance Goals for the Performance Period.

 

3.2        Determination of Performance Goals. Prior to the Determination Date, the Committee, in its sole discretion, shall establish, the Performance Goals for the Performance Period.   The Performance Goals shall be based on one or more of the following business criteria (if appropriate, as reported in the Company’s financial statements), any of which may be measured either in absolute terms, or as compared to an incremental increase, or as compared to the results of a peer group, or market performance indicators or indices:

 

	
  

	
·

	
revenue

 

	
  

	
·

	
cash flow

 

	
  

	
·

	
earnings or earnings per Share (including earnings before any one or more of the following (i) interest, (ii) taxes, (iii) depreciation, (iv) amortization, or (v) share based compensation

 

  

2

  

 

	
  

	
·

	
price per Share

 

	
  

	
·

	
completion of acquisitions, dispositions or partnerships or other corporate transactions

 

	
  

	
·

	
completion of settlements related to, money judgments, verdicts or awards related to and/or licensing arrangements for, the Company’s intellectual property

 

The Committee, in its discretion, may specify different Performance Goals for each Award.  The Performance Goals may include a threshold level of performance below which no Bonus Pool shall be calculated and no Award will be paid.  The Performance Goal may also include a maximum level of performance above which no additional Award amount will be paid.

 

3.3        Target Awards.  Prior to the Determination Date, the Committee, in its sole discretion, shall establish the Target Award for each Participant, expressed as a percentage of the Bonus Pool or as a percentage of the Participant’s base salary as of the first day of the Performance Period.   In establishing the Target Award, the Committee may consider the Participant’s length of employment and employment level, among other factors.

 

3.4        Adjustments.  To preserve the intended incentives and benefits of an Award, the Committee, in its sole discretion, may, at the time of the grant of an Award specify that:

 

(a)        one or more objectively determinable adjustments shall be made to one or more of the Performance Goals established in Section 3.2 hereof.  Such adjustments may include or exclude one or more of the following:

 

	
  

	
(i)

	
items that are extraordinary or unusual in nature or infrequent in occurrence, including one-time or non-recurring items;

 

	
  

	
(ii)

	
the effect of changes in tax laws, accounting standards or principles, or other laws or regulatory rules affecting reporting results;

 

	
  

	
(iii)

	
any reorganization and restructuring programs;

 

	
  

	
(iv)

	
acquisitions or divestitures;

 

	
  

	
(v)

	
any other items of significant income or expense which are determined to be appropriate adjustments; and/or

 

(b)        in determining the amount payable to a Participant with respect to the Participant’s Award, the Committee shall have the right, in its sole discretion, to reduce (but not increase) the amount otherwise payable under the Target Award to take into account the recommendation of the Chief Executive Officer of the Company and such additional factors, if any, that the Committee may deem relevant to the assessment of individual or corporate performance for the Performance Period.

 

  

3

  

 

No adjustment shall be made if the effect would be to cause an Award to fail to qualify as performance-based compensation under Code Section 162(m).

 

3.5        Award Limit.  The maximum aggregate amount of all Awards granted to a Participant with regard to any Plan Year shall not exceed the greater of (i) fifteen percent (15%) of the Bonus Pool or (ii) $2,000,000.

 

3.6        Other Incentive Awards.   The Plan is not the exclusive means for the Committee to award incentive compensation to employees and does not limit the Committee from making additional discretionary incentive awards.  No employee of the Company has a guaranteed right to any discretionary bonus as a substitute for a Target Award if Performance Goals are not met or if the Company’s shareholders fail to approve or reapprove the Plan.

 

4.      Payment of Awards.

 

4.1        Certification and Award Determination.  As soon as practical following the completion of each Performance Period, the Committee shall certify in writing, in accordance with the requirements of Section 162(m) of the Code, whether the specified Performance Goals were achieved for the Performance Period to which the Award relates.  The Committee shall then determine, in accordance with the prescribed formula, the amount of the Bonus Pool and/or the amount of each Participant’s Award.  In no event shall the amount of any Award for any Plan Year exceed the award limit set forth in Section 3.5.

 

4.2        Form and Timing of Payment.  Except as otherwise provided herein, as soon as practicable following the Committee's certification for the applicable Performance Period pursuant to Section 4.1, each Participant shall receive a cash payment of his or her Award, less required withholding.  Unless otherwise determined by the Committee in its sole discretion at the time of certification, such payment shall be made paid in a lump sum within 2 1/2 months following the date the Committee certifies that the Performance Goals have been achieved.

 

4.3        Employment Requirement. Except as otherwise provided for in Section 5 or Section 6 or the terms of an Award, no Award shall be paid to any Participant who is not actively employed by the Company on the date an Award is to be paid.

 

4.4        Leaves of Absence. If a Participant is on an approved leave of absence for a portion of a Performance Period, the Participant will be eligible to receive a pro-rated Award reflecting participation for the period during which he or she was actively employed and not any period when he or she was on leave.

 

  

4

  

 

5.      Termination of Employment.

 

5.1        Termination of Employment Due to Death or Disability. If a Participant's employment is terminated by reason of his or her death or Disability during a Performance Period or following a Performance Period but before the date that Awards are paid, the Participant or his or her beneficiary will be paid the Award that would otherwise be payable if the Participant remained employed through the date that Awards are paid.  Payment of such Award will be made at the same time and in the same manner as Awards are paid to other Participants.  "Disability" means, unless otherwise defined in an employment agreement between the Participant and the Company (in which case the definition in the employment agreement controls):

 

(a)         total and permanent disability in accordance with the Company's long-term disability plan, as determined by the Committee, or

 

(b)         permanent and total disability within the meaning of Code Section 22(e)(3).

 

5.2        Termination of Employment Without Cause or for Good Reason.  If (a) the Company terminates the Participant’s employment without Cause or (b) the Participant resigns his or her employment for Good Reason pursuant to an employment agreement between the Participant and the Company, in each case during a Performance Period or following a Performance Period but before the date that Awards are paid, unless otherwise provided for in the employment agreement between the Participant and the Company (in which case the provisions of the employment agreement control), the Participant will be paid the Award, pro-rated by the number of weeks the Participant worked during the Performance Period divided by the number of weeks in a Performance Period.  Payment of such pro-rated Award will be made at the same time and in the same manner as Awards are paid to other Participants.  “Cause” means, unless otherwise defined in an employment agreement between the Participant and the Company (in which case the definition in the employment agreement controls):  (i) willful and continued failure by the Participant to perform his or her job duties, (ii) the Participant performing an act of dishonesty, fraud, theft, embezzlement, or misappropriation involving the Participant’s employment with the Company, (iii) a material violation of established Company policies and procedures by the Participant, or (iv) the Participant performing any act resulting in a criminal felony charge brought against the Participant or a criminal conviction of the Participant (other than a conviction of a minor traffic violation). “Good Reason” has the meaning set forth in an employment agreement between the Participant and the Company.

 

  

5

  

 

6.      Change in Control.  If a Change in Control occurs during a Performance Period, Awards under the Plan will be calculated based on the achievement of Performance Goals on or prior to the date of the Change in Control. If the minimum Performance Goals are achieved and certified by the Committee pursuant to Section 4.1, each Participant will receive an Award calculated based on the prescribed formula. Awards paid in connection with a Change in Control will be paid no later than 2 1/2 months following the date the Committee certifies that the Performance Goals have been achieved.  "Change in Control" means, unless otherwise defined in an employment agreement between the Participant and the Company (in which case the definition in the employment agreement controls):

 

(a)             The direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company, taken as a whole, to any person that is not an Affiliate of the Company;

 

(b)             The Incumbent Directors cease for any reason to constitute at least a majority of the Board;

 

(i)           “Incumbent Directors" means the individuals who, as of the date the Plan is adopted, are directors of the Company and any individual who becomes a director subsequent to such date whose election, nomination for election, or appointment, was approved by a vote of at least two-thirds of the then-Incumbent Directors (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination).

 

(c)             The acquisition by any person of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended), of 50% or more (on a fully diluted basis) of either (i) the then outstanding Shares of the Company, taking into account as outstanding for this purpose such Shares issuable upon the exercise of options or warrants, the conversion of convertible stock or debt, and the exercise of any similar right to acquire such Shares or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities") provided, however, that for purposes of this Plan, the following acquisitions shall not constitute a Change in Control: (A) any acquisition by the Company or any Affiliate, (B) any acquisition by any employee benefit plan sponsored or maintained by the Company or any subsidiary, or (C) any acquisition which complies with clauses (i), (ii) and (iii) of subsection (d) of this definition; or

 

  

6

  

 

(d)             The consummation of a reorganization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company that requires the approval of the Company's shareholders, whether for such transaction or the issuance of securities in the transaction (a "Business Combination"), unless immediately following such Business Combination: (i) more than 50% of the total voting power of (A) the entity resulting from such Business Combination (the "Surviving Company"), or (B) if applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of sufficient voting securities eligible to elect a majority of the members of the board of directors (or the analogous governing body) of the Surviving Company (the "Parent Company"), is represented by the Outstanding Company Voting Securities that were outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which the Outstanding Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the voting power of the Outstanding Company Voting Securities among the holders thereof immediately prior to the Business Combination; (ii) no person (other than any employee benefit plan sponsored or maintained by the Surviving Company or the Parent Company) is or becomes the beneficial owner, directly or indirectly, of 50% or more of the total voting power of the outstanding voting securities eligible to elect members of the board of directors of the Parent Company (or the analogous governing body) (or, if there is no Parent Company, the Surviving Company); and (iii) at least a majority of the members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) following the consummation of the Business Combination were Board members at the time of the Board's approval of the execution of the initial agreement providing for such Business Combination.

 

7.      Administration.

 

7.1        Administration By the Committee. The Plan shall be administered by the Committee.  Members of the Committee shall be appointed by the Board.

 

7.2        Duties and Powers of the Committee. It shall be the duty of the Committee to conduct the general administration of the Plan in accordance with its provisions.  The Committee shall have the power to interpret the Plan, and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules.  In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under the Plan except with respect to matters which under Code Section 162(m) are required to be determined in the sole and absolute discretion of the Committee.

 

7.3        Decisions Binding. All determinations and decisions made by the Committee, the Board, and any delegate of the Committee pursuant to the provisions of the Plan shall be final, conclusive and binding on all persons, and shall be given the maximum deference permitted by law.

 

  

7

  

 

8.      Other Provisions.

 

8.1        Effective Date.   This Plan shall be effective as of January 1, 2013, subject to shareholder approval.  The Committee may grant Awards at any time on or after the Effective Date, provided that no amount shall be paid with respect to any Award unless and until the Plan is approved by the Company’s shareholders in accordance with Section 8.3.

 

8.2        Amendment or Termination of the Plan. The Board or the Committee may, at any time, amend, suspend or terminate the Plan in whole or in part; provided that, no amendment that requires shareholder approval in order for the Plan to continue to comply with Code Section 162(m) shall be effective unless approved by the requisite vote of the shareholders of the Company. Notwithstanding the foregoing, no amendment shall adversely affect the rights of any Participant to Awards allocated prior to such amendment, suspension or termination.

 

8.3        Approval of Plan by Shareholders.

 

(a)        This Plan shall be submitted for approval of the Company’s shareholders at the first annual meeting of shareholders to occur after the Effective Date.  If this Plan is not so approved, the Plan shall cease to be effective and no payment shall be made with respect to any Award.

 

(b)        The Plan shall be subject to reapproval by the shareholders of the Company not later than the first shareholder meeting that occurs in the fifth year following the year in which the shareholders last approved the Plan, if and as required under the Treasury Regulations pursuant to Code Section 162(m).  If the Plan is not so reapproved, no further Awards shall be granted under the Plan on or after the date of such shareholder meeting and any outstanding Award shall be paid in accordance with the terms and conditions of the Plan and such Award.

 

8.4        Withholding. The Company shall have the right to withhold from any Award, any federal, state or local income and/or payroll taxes required by law to be withheld and to take such other action as the Committee may deem advisable to enable the Company and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to an Award.

 

8.5        Clawback.   Awards under the Plan shall be subject to any claw-back provisions provided for in an employment agreement between the Participant and the Company.  For Participants who are not a party to an employment agreement with the Company that includes claw-back provisions, the Committee may provide that any Awards paid under the Plan shall be subject to any claw-back policy implemented by the Company, including, without limitation, any claw-back policy adopted to comply with the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder, to the extent set forth in such claw-back policy.

 

  

8

  

 

8.6        Qualified Performance-Based Compensation.  The Committee shall take such actions as it may deem necessary to ensure that Awards qualify as performance-based compensation as described in Code Section 162(m)(4)(C).  Any such Award shall be subject to any additional limitations set forth in Code Section 162(m) (including any amendment to Code Section 162(m)) that are requirements for qualifications as performance-based compensation as described in Code Section 162(m)(4)(C), and the Plan shall be deemed amended to the extent necessary to conform to such requirements.

 

8.7        Section 409A of the Code. It is intended that payments under the Plan qualify as short-term deferrals exempt from the requirements of Code Section 409A. In the event that any Award does not qualify for treatment as an exempt short-term deferral, it is intended that such amount will be paid in a manner that satisfies the requirements of Code Section 409A. The Plan shall be interpreted and construed accordingly.

 

9.      Miscellaneous.

 

(a)        The Plan and the granting of Awards shall be subject to all applicable federal and state laws, rules and regulations, and to such approvals by any regulatory or governmental agency as may be required.

 

(b)        A person's rights and interests under the Plan, including any Award previously made to such person or any amounts payable under the Plan may not be assigned, pledged, or transferred, except in the event of the Participant's death, to a designated beneficiary in accordance with the Plan, or in the absence of such designation, by will or the laws of descent or distribution.

 

(c)        Nothing in the Plan or in any notice of Award shall confer upon any person the right to continue in the employment of the Company or affect the right of the Company to terminate the employment of any Participant.

 

(d)        A Participant shall not have any right to any Award under the Plan until such Award has been certified by the Committee (such right being subject to the provisions of the Plan, including, without limitation, Section 4.3), and participation in the Plan in one Performance Period Year does not connote any right to become a Participant in the Plan in any future Performance Period.

 

(e)        The rights of Participants under the Plan shall be unfunded and unsecured.  Amounts payable under the Plan are not and will not be transferred into a trust or otherwise set aside.  The Company shall not be required to establish any special or separate fund or to make any other segregation of assets to assure the payment of any Award under the Plan.

 

  

9

  

 

(f)        All costs and expenses in connection with the administration of the Plan shall be paid by the Company.

 

(g)        If any provision of the Plan shall be considered illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of the Plan, but shall be fully severable, and the Plan shall be construed and enforced as if such illegal or invalid provision had never been contained therein.

 

(h)        Nothing in the Plan shall limit the authority of the Company, the Board or the Committee to adopt such other compensation arrangements, as it may deem desirable for any Participant.

 

(i)         All obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding upon any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation or otherwise, of all or substantially all of the assets of the Company.

 

(j)         The Plan shall be construed, administered and enforced in accordance with the laws of Florida without regard to conflicts of law.

 

 

10

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