Document:

CONFERENCE PLUS, INC. 2002 NONQUALIFIED STOCK PLAN

 

1.  Purpose.  The Conference Plus, Inc. 2002 Nonqualified Stock Plan (the "Plan") is intended to provide incentives which will attract and retain highly competent persons as employees of, Conference Plus, Inc. (the "Company"), by providing them opportunities to acquire shares of Class A common stock of the Company  ("Class A Common Shares"). 

 

2.  Administration.  The Plan will be administered by the full Board of Directors of the Company.   The Board is authorized, subject to the provisions of the Plan, to establish such rules and regulations as it deems necessary for the proper administration of the Plan and to make such determinations and interpretations and to take such action in connection with the Plan and any Awards granted hereunder as it deems necessary or advisable.  All determinations and interpretations made by the Board shall be binding and conclusive on all participants and their legal representatives.  No member of the Board  and no employee of the Company shall be liable for any act or failure to act hereunder, by himself or any other member or employee or by any agent to whom duties in connection with the administration of
this Plan have been delegated or, except in circumstances involving his bad faith, gross negligence or fraud, for any act or failure to act by the member or employee.  

 

3.  Participants.  Participants will consist of employees of the Company, as the Board in its sole discretion determines to be significantly responsible for the success and future growth and profitability of the Company and whom the Board may designate from time to time to receive Awards under the Plan.  Designation of a participant in any year shall not require the Board to designate such person to receive an Award in any other year or, once designated, to receive the same type or amount of Awards as granted to the participant in any year.  The Board shall consider such factors as it deems pertinent in selecting participants and in determining the type and amount of their respective Awards.  

 

4.  Types of Awards.  Awards under the Plan may be granted solely as options that are not intended to qualify as "incentive stock options" within the meaning of Section 422 of the Internal Revenue Code ("Nonqualified Stock Options").  The Board will have the authority to grant to any participant one or more Nonqualified Stock Options.  Each Stock Option shall be subject to such terms and conditions consistent with the Plan as the Board may impose from time to time.   The recipient of a Stock Option shall not be deemed for any purpose to be a shareholder of the Company with respect to any of the shares subject thereto except to the extent that the Stock Option shall have been exercised and, in addition, a certificate shall have been issued and delivered to the participant.

 

5.  Shares Reserved under the Plan.  There is hereby reserved for issuance under the Plan an aggregate of  1,500,000 Class A Common Shares,  which may 

 

 

be authorized but unissued shares or treasury shares.  In addition, all presently outstanding employee options granted by the Company shall be administered and subject to this Plan. Any shares subject to any form of Award hereunder may thereafter be subject to new Awards under this Plan if there is a lapse, expiration or termination of any such Awards prior to issuance of the shares.  In addition, in the event that any of the 1,179,245 Company employee stock options outstanding immediately prior to the adoption of this Plan shall lapse, expire or terminate prior to issuance of shares thereunder, the number of shares represented thereby may also become subject to new Awards under this Plan.

 

6.  Stock Options.  Stock Options will consist of awards from the Company, in the form of agreements, which will enable the holder to purchase a specific number of Class A Common Shares, at set terms and at a fixed purchase price. 

 

7.   Other Provisions.  Awards under the Plan may also be subject to such other provisions (whether or not applicable to any other Awards under the Plan) as the Board determines appropriate.

 

8.  Tenure.  A participant's right, if any, to continue to serve the Company as an officer, employee, or otherwise, shall not be enlarged or otherwise affected by his designation as a participant under the Plan, nor shall this Plan in any way interfere with the right of the Company, subject to the terms of any separate employment agreement to the contrary, at any time to terminate such employment or to increase or decrease the compensation of the participant from the rate in existence at the time of the grant of an Award.

 

9. Splits, etc. If the outstanding shares of the Company shall at any time be changed or exchanged by declaration of a stock dividend, stock split, combination or exchange of shares, recapitalization, or any other like event by or of the Company, and as often as the same shall occur, then the number  of  shares subject to the Plan or subject to any Stock Options therefore granted, and the exercise prices, shall be appropriately and equitably adjusted so as to maintain the proportionate number of shares without changing the aggregate purchase price.  Upon the occurrence of any of the foregoing, the class and aggregate number of shares issuable pursuant to the Plan in respect of which Options have not yet been exercised, shall be appropriately adjusted, all as will be determined by the Board of Directors, whose determination shall be final.

 

10.  Approval.  The Plan was adopted by the Board of Directors on  _________, 2002.CPI NON-QUALIFIED STOCK OPTION
 

 

 

THIS NON-QUALIFIED STOCK OPTION dated the _____ day of _______________, ____ (the "Date of Grant") is granted by Conference Plus, Inc., a Delaware corporation (the "Company"), to                                        ,  a key employee of the Company (the "Employee").

 

	
            1.
 	
            OPTION GRANT
 

The Company hereby grants to the Employee an option to purchase a total of ______ shares of Class A Common Stock of the Company (the “Common Stock”) at an option price of $ ____ per share, being not less than 100% of the fair market value of the stock on the Date of Grant based on an independent appraisal authorized by the Board of Directors of the Company.  This option is not intended to qualify as an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended. 

 

	
            2.
 	
            TIME OF EXERCISE
 

This option may be exercised (in the manner described in paragraph 3 hereof) in whole or in part, at any time and from time to time, subject to the following limitations:

(a)            This option shall not be exercisable to any extent until the earliest to occur of the following:

	
             
	
            (i)
 	
            Six (6) months after an initial public offering ("IPO") of the Company's Common Stock; or
 
	
            (ii)
 	
            A spin-off, split-off or other divisive reorganization of the Company ("Spin-Off");
 
				

provided that the IPO or Spin-Off results in the registration of the Common Stock under the Securities Exchange Act of 

 

 

1934 and the trading of the Common Stock on a national securities exchange or the NASDAQ market system; or

(iii)         A Change in Control of the Company, as defined in Paragraph 6 below; or

	
            (iv)
 	
            The fifth anniversary of the date hereof.
 

(b)           (i)In the event of an IPO (subject to the six month delay on exercisability described above)  or Spin-Off, this option shall be exercisable to the following cumulative extent:

	
            (A)
 	
            0% after the date hereof,
 	
             

	
            (B)
 	
            20% after the first anniversary of  the date hereof,
 	
             

	
            (C)
 	
            40% after the second anniversary of the date hereof,
 	
             

	
            (D)
 	
            60% after the third anniversary of the date hereof,
 	
             

	
            (E)
 	
            80% after the fourth anniversary of the date hereof, and
 
	
            (F)
 	
            100% after the fifth anniversary of the date hereof.
 	
             

						

 

(ii)           In the event of a Change in Control of the Company, this option shall be 100% exercisable immediately prior to closing of the transaction effecting such Change in Control, provided that if requested by the Company Employee must exercise such option in connection with the Change the Control and Employee must sell the stock issued in connection with the exercise hereof in the transaction effecting the Change in Control (or vote in favor of the same, as applicable) on the same terms as other holders of Common Stock.

 

(iii)              If there is no IPO or Spin-Off prior to the fifth anniversary of the Date of Grant, then subject to the other provisions of this Option, this Option shall become fully exercisable on the fifth anniversary of the Date of Grant.

 

(c)         If the Employee’s employment with the Company is terminated by either the Employee or the Company with or without cause or reason prior to the earlier of an IPO, a Spin-Off or the fifth anniversary of the date hereof, then 

 

 

regardless of the circumstances of termination and notwithstanding any other provision of this option (other than a termination upon a Change in Control of the Company in which event paragraph (b)(ii) above shall apply), this option shall immediately terminate without right of exercise and without any liability of the Company. 

 

(d)           If and to the extent this option has become exercisable pursuant to paragraph (a) and (b) above and it has not earlier terminated pursuant to paragraph (c) above, this option may not be exercised in any event:

	
             
	
            (i)
 	
            more than sixty (60) days after the termination of the Employee's employment with the Company for any reason other than retirement, total disability or death; or
 
	
            (ii)
 	
            more than twelve months after termination of employment by reason of retirement, total disability or death;           or
 
				

	
            (iii)
 	
            following termination for cause;  or
 	
             

	
             
	
            (iv)
 	
            more than ten years from the Date of Grant;
 
				

.

For these purposes “cause” shall mean termination of Employee’s employment by the Company because of: (i) the continued failure of the Employee to comply timely (when action is required in the interest of the Company or their commitments), with specific directions of the Board of Directors (“Board”) after a cure period determined by the Board, as communicated in a written notice from the Board or appropriate senior officer, which includes the specific failure to comply; or the taking of any action contrary to specific direction of the Board, or (ii) engaging by the Employee in willful, reckless or grossly negligent misconduct which, in the good faith determination of the Board, is materially injurious to the Company, its clients or their reputations, monetarily or otherwise, or (iii) aiding or abetting a competitor or other breach by the Employee of his 

 

 

fiduciary duty of loyalty to the Company; or (iv) a breach (other than an immaterial and inadvertent breach) by Employee of his/her obligations of confidentiality or nondisclosure or (if applicable) any breach of his/her obligations of noncompetition or nonsolicitation under any written agreement in effect between Employee and the Company; or (v) unlawful use or possession of illegal drugs on the Company’s premises; or (vi) conviction of Employee or pleading guilty or no contest to any felony or crime involving moral turpitude.

 

For these purposes retirement and total disability shall be determined in accordance with the established policies of the Company.  This option may be exercised during the indicated periods following termination of employment only to the extent permitted pursuant to paragraphs 2(a), (b) (c) and (d) hereof.

	
            3.
 	
            METHOD OF EXERCISE
 

This option may be exercised only by appropriate notice in writing delivered to the Secretary of the Company and accompanied by:

(a)            a check payable to the order of the Company for the full purchase price of the shares purchased and any required tax withholding, and 

(b)           unless there has been an IPO, Spin-Off  of Change in Control of the Company prior to the date of exercise, a duly executed agreement with the Company imposing certain restrictions and conditions on the ownership of the stock obtained upon exercise of this option in the form attached hereto as Exhibit A (unless the Employee has previously executed such agreement), and

(c)            such other documents or representations as the Company may reasonably request in order to comply with securities, tax or other laws then applicable to the exercise of the option.

With the Company's consent, payment of the purchase price may be made in whole or in part by the delivery of shares of Common Stock owned by the Employee for at least six months (or by certification of the Employee's ownership of such shares), valued at 

 

 

fair market value on the date of exercise.  At the option of the Company, the Employee may satisfy any tax withholding obligation in whole or in part by electing to have the Company retain option shares, having a fair market value on the date of exercise equal to the amount required to be withheld.  Fair market value as used herein means the amount per share of stock last established by annual (or more frequent) resolution of the Board of Directors. Valuation may be by independent appraisal at the election of the Board of Directors.

 

	
            4.
 	
            NON-TRANSFERABILITY; DEATH
 

This option is not transferable by the Employee otherwise than by will or the laws of descent and distribution and is exercisable during the Employee's lifetime only by the Employee.  If the Employee dies during the option period, this option may be exercised, to the extent indicated in paragraphs 2(a), (b) and (c), in whole or in part and from time to time, in the manner described in paragraph 3 hereof, by the Employee's estate or the person to whom the option passes by will or the laws of descent and distribution, but only within a period of (a) twelve months after the Employee's death or (b) ten years from the Date of Grant, whichever period is shorter.  At the discretion of the Board of Directors, after the IPO or Spin-Off, this option may be transferred to members of the Employee's immediate family or trusts or family partnerships for the benefit of such
persons, subject to terms and conditions established by the Committee.

 

	
            5.
 	
            ADJUSTMENTS
 

(a)         If the Company shall at any time change the number of shares of its Class A Common Stock without new consideration to the Company (such as by stock dividend, stock split or similar transaction), the total number of shares then remaining subject to purchase hereunder shall be changed in proportion to the change in issued shares and the option price per share shall be adjusted so that the total consideration payable to the Company upon the purchase of all shares not theretofore purchased shall not be changed.  

 

 

 

 

This option is granted by the Board of Directors of the Company pursuant to the 2002 Nonqualified Stock Plan.  The Board reserves the right to establish such rules and regulations as it deems necessary for the proper administration of its option grants and to make such determinations and interpretations, and to take such actions in connection with the options as it deems necessary or advisable.  All determinations and interpretations made by the Board shall be binding and conclusive on all participants and their legal representatives.

 

6.         DEFINITION. For purposes of this Option, a “Change in Control” of the Company is deemed to have occurred as of the first day that any one or more of the following conditions shall have been satisfied:

(i)       the consummation of the purchase by any person, entity or group of persons, within the meaning of Section 13(d) or 14(d) of the United States Securities Exchange Act of 1934, as amended, of ownership of fifty percent (50%) or more of either the total number of outstanding shares of common stock of the Company of all classes of or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally  (but a change of control of Westell Technologies, Inc. shall not itself constitute a Change in Control of the Company).;

(ii)      a reorganization, merger or consolidation of the Company, in each case, with respect to which persons who were shareholders of the Company immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power entitled to vote generally of the Company or the surviving or resulting entity (as the case may be);

	
            (iii)
 	
            a sale of all or substantially all of the Company’s assets.
 

 

 

 

 

IN WITNESS WHEREOF, the Company has caused the execution hereof by its duly authorized officer and Employee has agreed to the terms and conditions of this option all as of the date first above written.

 

	
            Conference Plus, Inc.
 

 

 

	
            By:______________________________
 

 

 

 

	
            _________________________________
 
	
            EMPLOYEE

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