EXHIBIT 4.1
THE BLACKHAWK FUND
EMPLOYEE STOCK INCENTIVE PLAN FOR THE YEAR 2005
1. General
Provisions.
-------------------
1.1 Purpose.
This Stock Incentive Plan (the "Plan") is intended to
-------
allow designated officers and employees
(all of whom are sometimes collectively
referred to herein as the "Employees," or
individually as the "Employee") of The
BlackHawk Fund, a Nevada corporation, formerly known as USA Telcom
Internationale and Zannwell, Inc., (the
"Company") and its Subsidiaries (as that
term is defined below) which they may have from
time to time (the Company and
such Subsidiaries are referred to herein as the
"Company") to receive certain
options (the "Stock Options") to purchase
common stock of the Company, par value
$0.001 per share (the "Common Stock"), and
to receive grants of the Common Stock
subject to certain restrictions (the
"Awards"). As used in this Plan, the term
"Subsidiary" shall mean each corporation which
is a "subsidiary corporation" of
the Company within the meaning of Section
424(f) of the Internal Revenue Code of
1986, as amended (the "Code"). The purpose of this Plan is to provide the
Employees, who make significant and
extraordinary contributions to the long-term
growth and performance of the Company, with equity-based compensation
incentives, and to attract and retain the Employees.
1.2
Administration.
--------------
1.2.1
The Plan shall be administered by the
Compensation Committee (the
"Committee") of, or appointed by, the Board of Directors of the
Company (the
"Board"). The Committee shall select one of its members as
Chairman and shall
act by vote of a majority of a quorum, or by unanimous
written consent. A
majority of its members shall constitute a quorum. The Committee shall be
governed by the provisions of the Company's
Bylaws and of Nevada law applicable
to the Board, except as otherwise provided
herein or determined by the Board.
1.2.2
The Committee shall have full and complete authority, in its
discretion, but subject to the express provisions of this
Plan (a) to approve
the Employees nominated by the management
of the Company to be granted Awards or
Stock Options; (b) to determine the number of Awards or Stock
Options to be
granted to an Employee; (c) to determine the
time or times at which Awards or
Stock Options shall be granted; (d) to establish
the terms and conditions upon
which Awards or Stock Options may be exercised; (e) to remove or
adjust any
restrictions and conditions upon Awards or
Stock Options; (f) to specify, at the
time of grant, provisions relating to exercisability of
Stock Options and to
accelerate or otherwise modify the
exercisability of any Stock Options; and (g)
to adopt such rules and regulations
and to make all other determinations deemed
necessary or desirable for the
administration of this Plan. All interpretations
and constructions of this Plan by the Committee, and all of its actions
hereunder, shall be binding and conclusive
on all persons for all purposes.
1.2.3
The Company hereby agrees to indemnify and hold harmless each
Committee member and each Employee, and the estate
and heirs of such Committee
member or Employee, against all claims, liabilities, expenses, penalties,
damages or other pecuniary losses, including legal
fees, which such Committee
member or Employee, his estate or heirs may suffer as a result of his
responsibilities, obligations or duties in connection with this Plan, to
the
extent that insurance, if any, does not cover the payment of
such items. No
member of the Committee or the Board shall be liable for any action or
determination made in good faith with
respect to this Plan or any Award or Stock
Option granted pursuant to this Plan.
1.3 Eligibility
and Participation. The Employees eligible under
this
-------------------------------
Plan shall be approved by the Committee
from those Employees who, in the opinion
of the management of the Company, are in positions
which enable them to make
significant contributions to the long-term performance and growth of the
Company. In selecting the Employees to whom Award or Stock Options may be
granted, consideration shall be given to factors such as
employment position,
duties and responsibilities, ability,
productivity, length of service, morale,
interest in the Company and recommendations of supervisors.
1.4 Shares
Subject to this Plan. The maximum number of shares of
the
-----------------------------
Common Stock that may be issued pursuant to this Plan shall be
700,000,000
subject to the provisions of Paragraph 4.1. If shares of the Common Stock
awarded or issued under this Plan are reacquired by the Company due to a
forfeiture or for any other
1
<PAGE>
reason, such shares shall be cancelled and
thereafter shall again be available
for purposes of this Plan. If a Stock Option expires, terminates or is
cancelled for any reason without having been
exercised in full, the shares of
the Common Stock not purchased
thereunder shall again be available for purposes
of this Plan. In the event that any outstanding Stock
Option or Award under
this Plan for any reason expires or is
terminated, the shares of Common Stock
allocable to the unexercised portion of the Stock Option or Award shall
be
available for issuance under the The BlackHawk
Fund Non-Employee Directors and
Consultants Retainer Stock Plan for the Year 2005.
The Compensation
Committee
may, in its discretion, increase the number of shares
available for issuance
under this Plan, while correspondingly
decreasing the number of shares available
for issuance under The BlackHawk Fund Non-Employee
Directors and Consultants
Retainer Stock Plan for the Year 2005.
2. Provisions
Relating to Stock Options.
----------------------------------------
2.1 Grants
of Stock Options.
The Committee may
grant Stock Options in
------------------------
such amounts, at such times, and to the
Employees nominated by the management of
the Company as the Committee, in its
discretion, may determine. Stock Options
granted under this Plan shall constitute "incentive
stock options" within the
meaning of Section 422 of the Code, if so designated by
the Committee on the
date of grant. The Committee shall also have the discretion to grant
Stock
Options which do not constitute incentive stock options, and any
such Stock
Options shall be designated non-statutory
stock options by the Committee on the
date of grant. The aggregate Fair Market Value
(determined as of the time an
incentive stock option is granted) of the Common Stock with
respect to which
incentive stock options are exercisable for the first time by any Employee
during any one calendar year (under all plans
of the Company and any parent or
subsidiary of the Company) may not exceed the maximum amount
permitted under
Section 422 of the Code (currently,
$100,000.00).
Non-statutory stock options
shall not be subject to the limitations relating to
incentive stock options
contained in the preceding sentence.
Each Stock Option
shall be evidenced by a
written agreement (the "Option Agreement")
in a form approved by the Committee,
which shall be executed on behalf of the
Company and by the Employee to whom the
Stock Option is granted, and which shall
be subject to the terms and conditions
of this Plan. In the discretion of the Committee, Stock
Options may include
provisions (which need not be uniform), authorized by the Committee in
its
discretion, that accelerate an Employee's rights to exercise Stock Options
following a "Change in Control," upon
termination of the Employee's employment
by the Company without "Cause" or by the Employee for
"Good Reason," as such
terms are defined in Paragraph 3.1 hereof.
The holder of a Stock
Option shall
not be entitled to the privileges of stock ownership
as to any shares of the
Common Stock not actually issued to such holder.
The exercise price per share for the
Stock covered by a Stock Option shall
be determined by the Committee at the time
of grant but in the case of Incentive
Stock Options shall not be less than 100% of the
Fair Market Value on the date
of grant. If an employee owns or is deemed
to own (by reason of the attribution
rules applicable under Section 424(d) of
the Code) more than 10% of the combined
voting power of all classes of stock of
the Company or any parent or subsidiary
corporation and an Incentive Stock Option is granted to such employee,
the
option price of such Incentive Stock Option
shall be not less than 110% of the
Fair Market Value on the grant date.
2.2 Purchase
Price. The purchase price (the "Exercise Price") of
---------------
shares of the Common Stock subject to each Stock
Option (the "Option Shares")
shall not be less than 85 percent of the
Fair Market Value of the Common Stock
on the date of the grant of the option.
For an Employee
holding greater than 10
percent of the total voting power of all
stock of the Company, either Common or
Preferred, the Exercise Price of an
incentive stock option shall be at least 110
percent of the Fair Market Value of the
Common Stock on the date of the grant of
the option. As used herein, "Fair Market Value" means the mean
between the
highest and lowest reported sales prices of the Common Stock
on the New York
Stock Exchange Composite Tape or, if not listed
on such exchange, on any other
national securities exchange on which the Common Stock is listed or on
The
Nasdaq Stock Market, or, if not so listed on any other national
securities
exchange or The Nasdaq Stock Market, then the
average of the bid price of the
Common Stock during the last five trading days on the OTC Bulletin Board
immediately preceding the last trading day prior to the date with
respect to
which the Fair Market Value is to be determined.
If the Common Stock is
not
then publicly traded, then the Fair Market Value of the
Common Stock shall be
the book value of the Company per
share as determined on the last day of March,
June, September, or December in any year closest to the date when the
determination is to be made. For the purpose of determining book value
hereunder, book value shall be determined by adding as
of the applicable date
called for herein the capital, surplus, and
undivided profits of the Company,
and after having deducted any reserves
theretofore established; the sum of these
items shall be divided by
2
<PAGE>
the number of shares of the Common Stock
outstanding as of said date, and the
quotient thus obtained shall represent the book value of each share of
the
Common Stock of the Company.
2.3 Option Period.
The Stock Option
period (the "Term") shall commence
-------------
on the date of grant of the Stock Option
and shall be 10 years or such shorter
period as is determined by the Committee.
Each Stock Option
shall provide that
it is exercisable over its term in such
periodic installments as the Committee
may determine, subject to the provisions of
Paragraph 2.4.1.
Section 16(b) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act") exempts
persons normally subject to the reporting
requirements of Section 16(a) of the
Exchange Act (the "Section 16 Reporting Persons") pursuant to a qualified
employee stock option plan from the normal
requirement of not selling until at
least six months and one day from the date
the Stock Option is granted.
2.4 Exercise
of Options.
---------------------
2.4.1
Each
Stock Option may be exercised in whole
or in part (but not
as to fractional shares) by delivering it for
surrender or endorsement to the
Company, attention of the Corporate Secretary, at the
principal office of the
Company, together with payment of the
Exercise Price and an executed Notice and
Agreement of Exercise in the form
prescribed by Paragraph 2.4.2. Payment may be
made (a) in cash, (b) by cashier's or certified check, (c)
by surrender of
previously owned shares of the Common Stock
valued pursuant to Paragraph 2.2 (if
the Committee authorizes payment in stock
in its discretion), (d) by withholding
from the Option Shares which would otherwise be
issuable upon the exercise of
the Stock Option that number of Option
Shares equal to the exercise price of the
Stock Option, if such withholding is authorized by the Committee in its
discretion, (e) in the discretion of the Committee, by the delivery to
the
Company of the optionee's promissory note
secured by the Option Shares, bearing
interest at a rate sufficient to prevent the imputation of interest
under
Sections 483 or 1274 of the Code, and
having such other terms and conditions as
may be satisfactory to the Committee., or
(f) if the Employee and the Company so
agree, deliver to the Optionee's NASD
licensed broker-dealer and to the Company
an irrevocable notice of exercise of the option, together with
irrevocable
instructions from the Optionee to the Company to deliver
the Option Shares to
the broker-dealer. Upon receipt of such notice, the
Company shall immediately
deliver to the Employee's broker-dealer the share
certificate(s) representing
the Option Shares so purchased, and upon receipt of
such certificate(s), the
broker shall sell the Option Shares and
remit the purchase price for all Option
Shares then being purchased, and any
withholding taxes to the Corporation.
2.4.2
Exercise of
each Stock Option is
conditioned upon the agreement
of the Employee to the terms and conditions of this Plan and of
such Stock
Option as evidenced by the Employee's execution and
delivery of a Notice and
Agreement of Exercise in a form to be determined by the Committee in
its
discretion. Such Notice and Agreement of
Exercise shall set forth the agreement
of the Employee that (a) no Option
Shares will be sold or otherwise distributed
in violation of the Securities Act of 1933,
as amended (the "Securities Act") or
any other applicable federal or state securities laws, (b) each
Option Share
certificate may be imprinted with legends
reflecting any applicable federal and
state securities law restrictions and conditions, (c) the Company
may comply
with said securities law restrictions
and issue "stop transfer" instructions to
its Transfer Agent and Registrar without liability, (d)
if the Employee is a
Section 16 Reporting Person, the Employee
will furnish to the Company a copy of
each Form 4 or Form 5 filed by said Employee
and will timely file all reports
required under federal securities laws, and (e) the Employee will
report all
sales of Option Shares to the Company in writing on a
form prescribed by the
Company.
2.4.3
No
Stock Option shall be exercisable unless and until any
applicable registration or qualification requirements of federal and state
securities laws, and all other legal requirements, have been
fully complied
with. The Company will use reasonable
efforts to maintain the effectiveness of a
registration statement under the Securities
Act (a "Registration Statement") for
the issuance of Stock Options and shares
acquired thereunder, but there may be
times when no such Registration Statement will be currently
effective. The
exercise of Stock Options may be
temporarily suspended without liability to the
Company during times when no such
Registration Statement is currently effective,
or during times when, in the reasonable opinion of the Committee, such
suspension is necessary to preclude violation
of any requirements of applicable
law or regulatory bodies having jurisdiction over the Company. If
any Stock
Option would expire for any reason except the end of its term
during such a
suspension, then if exercise of such Stock Option is
duly tendered before its
expiration, such Stock Option shall be
