Document:

ex4_1.htm

Exhibit 4.1

 

BANK OF MARIN BANCORP

 

2010 DIRECTOR STOCK PLAN

 

1.         PURPOSES OF THE PLAN

 

The 2010 Director Stock Plan (“Plan”) is intended to promote the interests of the Bank of Marin Bancorp and its subsidiary (“Company”) by providing for payment of director fees in shares of the Company’s authorized but unissued or re-acquired common stock (“Shares”) rather than by payment of a comparable value in cash.  The Plan is also intended to provide a convenient way for participants to purchase Shares from the Company at fair market value.

 

2.         ADMINISTRATION OF THE PLAN

 

(a)           The Board of Directors (the "Board") of the Company or any committee (the "Committee") of the Board that will satisfy Rule 16b-3 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and any regulations promulgated thereunder, as from time to time in effect, including any successor rule ("Rule 16b-3"), shall supervise and administer the Plan.  The Board may also at any time terminate the functions of the Committee under the Plan and reassume all powers and authority previously delegated to the Committee.

 

(b)           Any reference to the Board in one or more provisions of the Plan shall mean the Committee, if the Committee is at the time responsible for the administration of either the Plan or those particular provisions of the Plan.  The Board, or Committee, as the case may be, is authorized (subject to the provisions of the Plan) to establish such rules and regulations as it may deem appropriate for the proper administration of the Plan and to make such determinations under, and issue such interpretations of, the Plan as it may deem necessary or advisable.  Decisions of the Board or the Committee, as the case may be, shall be final and binding on all parties who have an interest in the Plan.

 

(c)           Notwithstanding anything hereinafter set forth, the Plan shall be administered, operated and effectuated in such a manner so that the Plan shall be compliant with Rule 16b-3 and other provisions of the Exchange Act, as applicable, so as to assure the transactions contemplated herein are exempt from Section 16(b) of the Exchange Act.

  

  

  

3.         ELIGIBILITY FOR ISSUANCE OF SHARES

 

(a)           The individuals who shall be eligible to receive Shares pursuant to the Plan shall be members of the Board (whether or not they are also employees of the Company).

 

(b)           Subject to subsection (a) above, the Board shall have full authority to determine the individuals who are granted Shares under “Part A of the Plan” (as said term is defined herein) and, subject to section 4(a) below, the number of Shares to be granted.

 

(c)           The directors intending to participate in “Part B of the Plan” (as said term is defined herein) shall comply with the participation requirements of Section 6 of the Plan.

 

4.         STOCK SUBJECT TO THE PLAN

 

(a)           The stock issuable under the Plan shall be the Shares.  The aggregate number of issuable Shares shall not exceed 150,000 subject to adjustment from time to time in accordance with subsection 4(b).

 

(b)           In the event any change is made to the Company’s common stock (whether by reason of merger, consolidation, reorganization, recapitalization, stock dividend, stock split, combination of shares, exchange of shares, or other change in corporate or capital structure effected without receipt of consideration), then the maximum number of Shares still available for issuance under the Plan shall be automatically adjusted to reflect the effect of such change upon the Company’s capital structure.  Any adjustment by the Board pursuant to this section shall be conclusive.

 

5.         PART A OF THE PLAN: DIRECTOR FEES

 

Each person serving as a director of the Company may be granted and issued Shares, each July and January from and after July 1, 2010 and during the term of the Plan.  The Board, as administrator of the Plan, will determine the actual number of Shares to be issued at any one time giving consideration to the fair market value of the Company’s common stock as of the date of issuance and their judgment as to the appropriate level of director fees to be paid by issuance of Shares.

 

6.         PART B OF THE PLAN: STOCK PURCHASE

 

It is anticipated that each person serving as a director of the Company may be granted the rights to purchase Shares, each July and January from and after January 1, 2010, and during the term of the Plan.  Each six month offering period (the “Offering Period”) will end on each respective June 30 and December 31st of each year with the first such Offering Period ending on June 30, 2010.

  

  

  

Each Offering Period will begin on the first day of that period described (the “Beginning Date”) and end on the last day of that period (the “Ending Date”).  For each Offering Period, the Company will make available to each director an election form (the “Election Form”) which must be completed to effect his or her right to commence active participation in Part B of the Plan.  The Election Form will provide each participating director with instructions to purchase the Shares, including instructions for the timing and preferred method of delivery of payment, for the respective Offering Period.  The Election Form shall also include delivery instructions relating to the Shares, including instructions to the Company’s transfer agent.  Each director may become an active participant for an Offering Period by completing the Election Form and delivering the same to the Company at least ten business days prior to the appropriate Ending Date.

 

Irrespective of participation in prior Offering Periods, a separate Election Form must be completed for each Offering Period that a director intends to participate in.  No reliance on Election Forms from prior Offering Periods shall be permitted.

 

A director’s failure to complete an Election Form before ten business days prior to the appropriate Ending Date shall result in the director’s de facto rejection of participation in the respective Offering Period.  Following a director’s lack of participation in an Offering Period, the nonparticipating director is free to complete an Election Form for the next successive Offering Period.

 

The purchase price for a Share during each respective Offering Period will be the fair market value of a share of the Company’s common stock on the Ending Date for such Offering Period.

 

At no time during the term of this Plan will the number of Shares available for purchase by a director pursuant to Part B of the Plan during any six month period to any individual director exceed an amount equal to 100% of their immediate prior period issued amount granted and issued under section 5.

 

7.         FAIR MARKET VALUE

 

For the purposes of this Plan, “fair market value” of a Share as of a specific date shall be defined as follows: (i) if the Shares are traded on a national securities exchange, the consolidated closing bid price for the company’s shares on that date or the immediately preceding trade date if such date is not a trading date; (ii) if the Shares are not traded on any such exchange, the closing sale price for such date as reported by Nasdaq; (iii) if no such closing price information is available on the national securities exchange or Nasdaq, the closing sale price as reported by the national securities exchange or Nasdaq within a reasonable period prior to such date; or (iv) if there is no such closing sale price within a reasonable period, the determination of fair market value shall be determined by the Board, taking into account material facts and circumstances pertinent to such determination.  In the event that the definition of “fair market value” as set forth above conflicts with the definition of “fair market value” as provided by the rules governing Nasdaq, the definition set forth in the rules governing the Nasdaq stock market shall govern.

  

  

  

8.         EFFECTIVE DATE AND TERM OF PLAN

 

(a)           The Plan shall become effective on the day after the Plan shall have been approved by the shareholders of the Company holding not less than a majority of the outstanding shares of the Company’s common stock present at a duly called meeting.

 

(b)           Unless the Plan is sooner terminated at the election of the Company, no Shares may be issued pursuant to the Plan after the earlier of (i) the tenth anniversary of the effective date of the Plan or (ii) the date on which all Shares available for issuance under the Plan shall have been issued.

 

9.         PROCEEDS FROM ISSUANCE OF SHARES

 

(a)           The Shares issued as director fees are to be issued in lieu of payment of cash fees to directors and no proceeds will be received by the Company from the issuance of these Shares.

 

(b)           The proceeds from the purchase of Shares issued as a result of a stock purchase pursuant to Part B of the Plan shall be received by the Company and shall be commingled with the general assets of the Company and no separate fund shall be established.  The proceeds from Shares purchased by the directors with cash shall be used for general corporate purposes.

 

10.       WITHHOLDING

 

(a)           In the event that a director is required to pay to the Company an amount with respect to federal, state or local income and employment tax withholding obligations in connection with the issuance of Shares, the Board may, in its discretion and subject to such rules as it may adopt, permit such director to satisfy the obligations, in whole or in part, by either (i) making an irrevocable election that a portion of the total value of the Shares to be issued to such director be paid in the form of cash in lieu of the issuance of Shares and that such cash payment be applied to the satisfaction of the withholding obligations or (ii) tendering Shares previously held by the director in a number sufficient to satisfy such obligations.

  

  

  

(b)           The Company’s obligation to deliver Shares under the Plan shall be subject to the director’s satisfaction of all applicable federal, state and local income and employment tax withholding requirements.

 

11.       NO EMPLOYMENT OR SERVICE OBLIGATION

 

Neither the action of the Company in establishing the Plan, nor any action taken by the Board or the Committee hereunder, nor any provision of the Plan itself shall be construed so as to grant any individual the right to remain as a director of the Company or otherwise be in the employ or service of the Company or its parent corporation or any of its subsidiaries for any period of specific duration.

 

12.       SECURITIES LAWS RESTRICTIONS

 

Shares shall not be issued under the Plan unless (a) the exercise of the related purchase rights and the issuance and delivery of the Shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act of 1933, as amended, and any rules and regulations promulgated pursuant to such laws and with the requirements of any stock exchange upon which the Shares may then be listed; and (b) the express approval of counsel for the Company with respect to such compliance is first obtained.  The Company reserves the right to place an appropriate legend on any certificate representing Shares issuable under the Plan with any such legend reflecting restrictions on the transfer of the Shares as may be necessary to assure the availability of applicable exemptions under federal and state securities laws.

 

13.       TRANSFERABILITY

 

Neither payroll deductions credit to a participant’s account nor any rights with regard to the exercise or purchase rights or to receive any Shares under the Plan may be assigned, transferred, pledged or otherwise disposed of in any way by a participant.  Any attempted assignment, transfer, pledge or other disposition shall be without effect.

 

14.       AMENDMENT AND TERMINATION

 

The Board may at any time amend, alter, suspend, or discontinue the Plan, but no amendment, alteration, suspension, or discontinuation shall be made which would impair the awards granted to any Participant theretofore made, without his or her consent. In addition, to the extent necessary and desirable to comply with any applicable law, regulation or stock exchange rule, the Company shall obtain shareholder approval of any Plan amendment in such a manner and to such a degree as required. The Board may terminate the Plan at any time without shareholder approval.

  

  

  

15.       REGULATORY APPROVALS

 

The implementation of the Plan and the issuance of stock shall be subject to the Company’s procurement of all approvals and permits required by regulatory authorities having jurisdiction over the Plan and the stock issued pursuant to it.

 

16.       GOVERNING LAW

 

To the extent not otherwise governed by federal law, the Plan and its implementation shall be governed by and construed in accordance with the laws of the State of California.ex10_5.htm

Exhibit 10.5

 

AMENDMENT AGREEMENT

This Amendment Agreement (this “Agreement”), dated as of April 21, 2010 is entered into by and among Axis Technologies Group, Inc., a Delaware corporation (the “Company”), Axis Technologies, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Guarantor”), GEMINI STRATEGIES, LLC, a Delaware limited liability company (the “Collateral Agent”), and GEMINI MASTER FUND, LTD., a Cayman Islands corporation (the “Investor”).  The Company and the Guarantor are sometimes referred to herein individually as an “Axis Entity” and collectively as the “Axis Entities”.

R E C I T A L S:

WHEREAS, the Investor holds that certain Amended and Restated 10% Senior Secured Convertible Note restated as of December 30, 2009 with a principal amount as of such date equal to $1,884,097.22 (the “Note”), which Note was amended and restated on such date pursuant to that certain Amendment Agreement entered into by the parties hereto on December 30, 2009 (“Amendment”);

WHEREAS, on or about the date hereof, the Axis Entities are entering into that certain Axis Joint Venture Agreement with IRC – Interstate Realty Corporation (“IRC”) and DHAB, LLC (“JV Agreement”);

WHEREAS, on or about the date hereof, Investor, the Collateral Agent and IRC are entering into that certain Intercreditor Agreement (“Intercreditor Agreement”); and

WHEREAS, the Company and Investor wish to extend the Maturity Date on the terms and conditions set forth herein;

A G R E E M E N T:

NOW, THEREFORE, in consideration of the foregoing and subject to the terms and conditions herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.             DEFINITIONS.

1.1           Certain Defined Terms.  As used in this Agreement, the following terms shall have the meanings set forth below:

“Existing Transaction Documents” means the Purchase Agreement, the Note, the Security Documents, the Guarantee, the Amendment and all other agreements, instruments and other documents executed and delivered by or on behalf of the Axis Entities or any of their officers in connection with any of the foregoing agreements.

“Transaction Documents” means the Existing Transaction Documents (as amended by this Agreement), this Agreement and all other agreements, instruments and other documents executed and delivered by or on behalf of the Axis Entities or any of their officers in connection with this Agreement.

  

  

  

“Purchase Agreement” means that certain Securities Purchase Agreement between the Company and the Investor, dated as of April 25, 2008, pursuant to which the Company originally issued the Note to the Investor.

1.2           Terms Defined in the Existing Transaction Documents.  Capitalized terms used in this Agreement and not otherwise defined herein shall have the respective meanings ascribed to them in the Existing Transaction Documents.

2.             AMENDMENT OF NOTE.  Effective upon the full execution of the JV Agreement, the Maturity Date under the Note is hereby amended to be July 1, 2010, provided that upon any Axis Entity directly or indirectly receiving any funding as contemplated in the JV Agreement (other than the purchase order financing to be provided by IRC thereunder), the Note shall be repaid with the proceeds from such financing.

3.             ADDITONAL AMENDMENTS AND OTHER AGREEMENTS.

3.1           Repayment from Inventory Proceeds.  The Axis Entities agree that 10% of any and all proceeds received from the sale of any inventory of the Axis Entities (including without limitation the IRC Inventory, as defined in the JV Agreement) shall be promptly paid to Investor in partial repayment of the Note.  The Axis Entities shall pay or cause such amount to be paid to Investor within three (3) business days following receipt thereof.

3.2           Consent to JV Agreement.  Subject to the execution of the Intercreditor Agreement by the parties thereto, to the extent the transactions contemplated by the JV Agreement (in such form as presented to Investor) are prohibited under the terms of the Gemini Financing Documents (as defined in the Intercreditor Agreement), Investor hereby consents to the consummation of such transactions.

3.3           No Novation; Rule 144.  The Note as amended hereby shall not constitute a novation or satisfaction and accord of the Note.  The Company hereby acknowledges and agrees that the Note is merely amended hereby and that Investor has not given any consideration to the Company in connection with such amendment, and this Agreement shall not extinguish or release the Company or Guarantor under any Transaction Document or otherwise constitute a novation of their obligations thereunder.  For purposes of Rule 144 promulgated under the Securities Act, the holding period of the Note shall not be affected by this Agreement.  Without limiting the foregoing, if at any time it is determined that such holding period does not so tack, the Company will promptly, but no later than 30 days thereafter, cause the registration of all such Underlying Shares under the Securities Act (without regard to any beneficial ownership or issuance limitations contained in the Note).  In connection with any registration of Underlying Shares pursuant to this Section, the Company and the Investor shall enter into a registration rights agreement containing customary and reasonable provisions regarding the registration of securities under the Securities Act.

  

  

  

3.4           Security Continued.  The Axis Entities’ obligations under all the Transaction Documents shall be secured by all the assets of the Axis Entities pursuant to the Security Documents (and guaranteed by the Guarantor under the Guarantee) as if this Agreement and the Note as amended hereby were each in effect at the time of execution of such Security Documents and referenced therein.  The Company shall execute such other agreements, documents and financing statements reasonably requested by Investor, which will be filed at the Company’s expense with the applicable jurisdictions and authorities.

3.5           Disclosure.  To the extent the transactions contemplated hereby or in the JV Agreement constitute material non-public information concerning the Axis Entities, the Company shall, by 8:30 a.m. (New York City time) on third business day following the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby and thereby.  The Company and the Investor shall consult with each other in issuing such press release and any other press releases with respect to the transactions contemplated hereby.

4.             MISCELLANEOUS.

4.1           Severability.  In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision; provided that in such case the parties shall negotiate in good faith to replace such provision with a new provision which is not illegal, unenforceable or void, as long as such new provision does not materially change the economic benefits of this Agreement to the parties.

4.2           Successors and Assigns.  The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties.  Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement. The Investor may assign its rights and obligations hereunder, as long as, as a condition precedent to such transfer, the transferee executes an acknowledgment agreeing to be bound by the applicable provisions of this Agreement, in which case the term “Investor” shall be deemed to refer to such transferee as though such transferee were an original signatory hereto.  None of the Axis Entities may assign its rights or obligations under this Agreement.

4.3           Injunctive Relief.  Each of the Axis Entities acknowledges and agrees that a breach by it of its obligations hereunder will cause irreparable harm to the Investor and that the remedy or remedies at law for any such breach will be inadequate and agrees, in the event of any such breach, in addition to all other available remedies, the Investor shall be entitled to an injunction restraining any breach and requiring immediate and specific performance of such obligations without the necessity of showing economic loss or the posting of any bond.

4.4           Governing Law; Jurisdiction; Waiver of Jury Trial.  (a)  This Agreement shall be governed by and construed under the laws of the State of New York applicable to contracts made and to be performed entirely within the State of New York.  Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City and County of New York for the adjudication of any dispute hereunder or any other Transaction Document or in connection herewith or therewith or with any transaction contemplated hereby or thereby, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.

  

  

  

(b) EACH PARTY TO THIS AGREEMENT ACKNOWLEDGES AND AGREES THAT ANY DISPUTE OR CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE BREACH, TERMINATION OR VALIDITY OF THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

4.5           Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.  This Agreement may be executed and delivered by facsimile transmission or by email of a digital image format file.

4.6           Headings.  The headings used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

4.7           Entire Agreement; Amendments.  This Agreement and the other Transaction Documents constitute the entire agreement between the parties with regard to the subject matter hereof and thereof, superseding all prior agreements or understandings, whether written or oral, between or among the parties.

4.8           Full Force and Effect.  Except as specifically waived and amended hereby and for the purposes described herein, the Existing Transaction Documents shall remain in full force and effect in accordance with their respective terms.  Except for the waiver and amendment contained herein, this Agreement shall not in any way waive or prejudice any of the rights of the Investor or obligations of the Company under the Transaction Documents, or under any law, in equity or otherwise, and such waiver and amendment shall not constitute a waiver or amendment of any other provision of the Transaction Documents nor a waiver or amendment of any subsequent default or breach of any obligation of the Company or of any subsequent right of the Investor.

[Signature Page to Follow]

  

  

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on the day and year first above written.

	
AXIS TECHNOLOGIES GROUP, INC.

	  	
GEMINI MASTER FUND, LTD.

	  	  	  	
By:

	
GEMINI STRATEGIES, LLC, as investment manager

	  	  	  	  	  
	
By:

	
/s/ Jim Erickson

	  	  	  
	
Name:

	
Jim Erickson

	  	
By:

	
/s/ Steven Winters

	
Title:

	
President

	  	
Name:

	
Steven Winters

	  	  	  	
Title:

	
President

	  	  	  	  	  
	  	  	  	  	  
	
AXIS TECHNOLOGIES, INC.

	  	
GEMINI STRATEGIES, LLC

	  	  	  	  	  
	  	  	  	  	  
	
By:

	
/s/ Jim Erickson

	  	
By:

	
/s/ Steven Winters

	
Name:

	
Jim Erickson

	  	
Name:

	
Steven Winters

	
Title:

	
President

	  	
Title:

	
President

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