This GAIN
Capital Holdings, Inc. 2006 Equity Compensation Plan (the
“Plan”) was initially adopted by GAIN Capital, Inc., a
Delaware corporation, on October 1, 1999, and was assumed on
August 1, 2003 by GAIN Capital Group, Inc. In connection with
that certain merger arrangement by and among GAIN Capital Holdings,
Inc., a Delaware corporation (the “Company”), GAIN
Capital Group, Inc., a Delaware limited liability company, and GH
Formation, Inc., a Delaware corporation and an indirect wholly
owned subsidiary of the Company, the Company now assumes the Plan,
and all outstanding options issued thereunder, effective
March 27, 2006 to read, in its entirety, as
follows:
GAIN CAPITAL HOLDINGS,
INC.
2006 EQUITY COMPENSATION
PLAN
The purpose of the
GAIN Capital Holdings, Inc. 2006 Equity Compensation Plan (the
“Plan”) is to provide (i) designated employees of
GAIN Capital Holdings, Inc. (the “Company”) and its
subsidiaries, (ii) certain consultants and advisors who
perform services for the Company or its subsidiaries and
(iii) non-employee members of the Board of Directors of the
Company (the “Board”) with the opportunity to receive
grants of incentive stock options, nonqualified stock options and
stock awards. The Company believes that the Plan will encourage the
participants to contribute materially to the growth of the Company,
thereby benefiting the Company’s stockholders, and will align
the economic interests of the participants with those of the
stockholders.
(a)
Committee . The Plan shall be administered and interpreted
by the Board or by a committee consisting of members of the Board,
which shall be appointed by the Board. However, the Board may
ratify or approve any grants as it deems appropriate, and the Board
shall approve and administer all grants made to non-employee
directors. If a committee is appointed, the committee may delegate
authority to one or more subcommittees, as it deems appropriate. If
a committee or subcommittee administers the Plan, references in the
Plan to the “Board,” as they relate to Plan
administration, shall be deemed to refer to the committee or
subcommittee.
(b)
Board Authority . The Board shall have the sole authority to
(i) determine the individuals to whom grants shall be made under
the Plan, (ii) determine the type, size and terms of the grants to
be made to each such individual, (iii) determine the time when the
grants will be made and the duration of any applicable exercise or
restriction period, including the criteria for exercisability and
the acceleration of exercisability, (iv) amend the terms of
any previously issued grant, and (v) deal with any other matters
arising under the Plan.
(c)
Board Determinations . The Board shall have full power and
authority to administer and interpret the Plan, to make factual
determinations and to adopt
or amend such
rules, regulations, agreements and instruments for implementing the
Plan and for the conduct of its business as it deems necessary or
advisable, in its sole discretion. The Board’s
interpretations of the Plan and all determinations made by the
Board pursuant to the powers vested in it hereunder shall be
conclusive and binding on all persons having any interest in the
Plan or in any awards granted hereunder. All powers of the Board
shall be executed in its sole discretion, in the best interest of
the Company, not as a fiduciary, and in keeping with the objectives
of the Plan and need not be uniform as to similarly situated
individuals.
Awards
under the Plan may consist of grants of incentive stock options as
described in Section 5 (“Incentive Stock
Options”), nonqualified stock options as described in
Section 5 (“Nonqualified Stock Options”)
(Incentive Stock Options and Nonqualified Stock Options are
collectively referred to as “Options”) and stock awards
as described in Section 6 (“Stock Awards”)
(hereinafter collectively referred to as “Grants”). All
Grants shall be subject to the terms and conditions set forth
herein and to such other terms and conditions consistent with this
Plan as the Board deems appropriate and as are specified in writing
by the Board to the individual in a grant instrument or an
amendment to the grant instrument (the “Grant
Instrument”). The Board shall approve the form and provisions
of each Grant Instrument. All Grants shall be made conditional upon
the Grantee’s acknowledgement, in writing or by acceptance of
the Grant, that all decisions and determinations of the Board shall
be final and binding on the Grantee, his beneficiaries and any
other person having or claiming an interest under such Grant.
Grants under a particular Section of the Plan need not be uniform
as among the Grantees.
3. Shares
Subject to the Plan
(a)
Shares Authorized . Subject to adjustment as described
below, the aggregate number of shares of common stock of the
Company (“Company Stock”) that may be issued or
transferred under the Plan is 3,600,000 shares. The shares may be
authorized but unissued shares of Company Stock or reacquired
shares of Company Stock, including shares purchased by the Company
on the open market for purposes of the Plan. If and to the extent
Options granted under the Plan terminate, expire, or are canceled,
forfeited, exchanged or surrendered without having been exercised
or if any Stock Awards are forfeited, the shares subject to such
Grants shall again be available for purposes of the Plan. Shares of
Company Stock surrendered in payment of the exercise price of an
Option shall again be available for issuance or transfer under the
Plan.
(b)
Adjustments . If there is any change in the number or kind
of shares of Company Stock outstanding (i) by reason of a
stock dividend, spinoff, recapitalization, stock split, or
combination or exchange of shares, (ii) by reason of a merger,
reorganization or consolidation, (iii) by reason of a
reclassification or change in par value, or (iv) by reason of
any other extraordinary or unusual event affecting the outstanding
Company Stock as a class without the Company’s receipt of
consideration, or if the value of outstanding shares of Company
Stock is substantially reduced as a result of a spinoff or the
Company’s payment of an extraordinary dividend or
distribution, the
maximum number
of shares of Company Stock available for Grants, the number and
kind of shares covered by outstanding Grants, the kind of shares to
be issued or transferred under the Plan, and the price per share or
applicable market value of such Grants may be appropriately
adjusted by the Board to reflect any increase or decrease in the
number of, or change in the kind or value of, issued shares of
Company Stock to preclude, to the extent practicable, the
enlargement or dilution of rights and benefits under such Grants;
provided, however, that any fractional shares resulting from such
adjustment shall be eliminated. Any adjustments determined by the
Board shall be final, binding and conclusive.
4.
Eligibility for Participation
(a)
Eligible Persons . All employees of the Company and its
subsidiaries (“Employees”), including Employees who are
officers or members of the Board, and members of the Board who are
not Employees (“Non-Employee Directors”) shall be
eligible to participate in the Plan. Consultants and advisors who
perform services for the Company or any of its subsidiaries
(“Key Advisors”) shall be eligible to participate in
the Plan if the Key Advisors render bona fide services to the
Company or its subsidiaries, the services are not in connection
with the offer and sale of securities in a capital-raising
transaction, and the Key Advisors do not directly or indirectly
promote or maintain a market for the Company’s
securities.
(b)
Selection of Grantees . The Board shall select the
Employees, Non- Employee Directors and Key Advisors to receive
Grants and shall determine the number of shares of Company Stock
subject to a particular Grant in such manner as the Board
determines. Employees, Key Advisors and Non-Employee Directors who
receive Grants under this Plan shall hereinafter be referred to as
“Grantees”.
The
Board may grant Options to an Employee, Non-Employee Director or
Key Advisor, upon such terms as the Board deems appropriate. The
following provisions are applicable to Options:
(a)
Number of Shares . The Board shall determine the number of
shares of Company Stock that will be subject to each Grant of
Options to Employees, Non-Employee Directors and Key
Advisors,
(b)
Type of Option and Price .
(i) The
Board may grant Incentive Stock Options that are intended to
qualify as “incentive stock options” within the meaning
of section 422 of the Internal Revenue Code of 1986, as amended
(the “Code”) or Nonqualified Stock Options that are not
intended so to qualify or any combination of Incentive Stock
Options and Nonqualified Stock Options, all in accordance with the
terms and conditions set forth herein. Incentive Stock Options may
be granted only to Employees. Nonqualified Stock Options may be
granted to Employees, Non-Employee Directors and Key
Advisors.
(ii) The
purchase price (the “Exercise Price”) of Company Stock
subject to an Option shall be determined by the Board and may be
equal to or greater than the Fair Market Value (as defined below)
of a share of Company Stock on the date the Option is granted;
provided, however, that an Incentive Stock Option may not be
granted to an Employee who, at the time of grant, owns stock
possessing more than ten percent of the total combined voting power
of all classes of stock of the Company or subsidiary of the
Company, unless the Exercise Price per share is not less than 110%
of the Fair Market Value of Company Stock on the date of
grant.
(iii) If
the Company Stock is publicly traded, then the Fair Market Value
per share shall be determined as follows: (A) if the principal
trading market for the Company Stock is a national securities
exchange or the NASDAQ National Market, the last reported sale
price thereof on the relevant date (or if there were no trades on
that date the latest preceding date upon which a sale was
reported), or (B) if the Company Stock is not principally
traded on such exchange or market, the mean between the last
reported “bid” and “asked” prices of
Company Stock on the relevant date, as reported on Nasdaq or, if
not so reported, as reported by the National Daily Quotation
Bureau, Inc. or as reported in a customary financial reporting
service, as applicable and as the Board determines. If the Company
Stock is not publicly traded or, if publicly traded, is not subject
to reported transactions or “bid” or
“asked” quotations as set forth above, the Fair Market
Value per share shall be as determined by the Board through any
reasonable valuation method authorized under the Code.
(c)
Option Term . The Board shall determine the term of each
Option. The term of any Option shall not exceed ten years from the
date of grant. However, an Incentive Stock Option that is granted
to an Employee who, at the time of grant, owns stock possessing
more than ten percent of the total combined voting power of all
classes of stock of the Company, or any parent or subsidiary of the
Company, may not have a term that exceeds five years from the date
of grant.
(d)
Exercisability of Options . Options shall become exercisable
in accordance with such terms and conditions, consistent with the
Plan, as may be determined by the Board and specified in the Grant
Instrument. The Board may accelerate the exercisability of any or
all outstanding Options at any time for any reason.
(e)
Grants to Non-Exempt Employees . Notwithstanding the
foregoing, Options granted to persons who are non-exempt employees
under the Fair Labor Standards Act of 1938, as amended, may not be
exercisable for at least six months after the date of grant (except
that such Options may become exercisable, as determined by the
Board, upon the Grantee’s death, Disability or retirement, or
upon a Change of Control or other circumstances permitted by
applicable regulations).
(f)
Termination of Employment, Disability or Death .
(i) Except
as provided below, an Option may only be exercised while the
Grantee is employed by, or providing service to, the Company as an
Employee, Key Advisor or member of the Board.
(ii) In
the event that a Grantee ceases to be employed by, or provide
service to, the Company for any reason other than Disability (as
defined below), death, or termination for Cause (as defined below),
any Option which is otherwise exercisable by the Grantee shall
terminate unless exercised within 90 days after the date on
which the Grantee ceases to be employed by, or provide service to,
the Company (or within such other period of time as may be
specified by the Board), but in any event no later than the date of
expiration of the Option term. Except as otherwise provided by the
Board, any of the Grantee’s Options that are not otherwise
exercisable as of the date on which the Grantee ceases to be
employed by, or provide service to, the Company shall terminate as
of such date.
(iii) In
the event the Grantee ceases to be employed by, or provide service
to, the Company on account of a termination for Cause by the
Company, any Option held by the Grantee shall terminate as of the
date the Grantee ceases to be employed by, or provide service to,
the Company. In addition, notwithstanding any other provisions of
this Section 5, if the Board determines that the Grantee has
engaged in conduct that constitutes Cause at any time while the
Grantee is employed by, or providing service to, the Company or
after the Grantee’s termination of employment or service, any
Option held by the Grantee shall immediately terminate, and the
Grantee shall automatically forfeit all shares underlying any
exercised portion of an Option for which the Company has not yet
delivered the share certificates, upon refund by the Company of the
Exercise Price paid by the Grantee for such shares. Upon any
exercise of an Option, the Company may withhold delivery of share
certificates pending resolution of an inquiry that could lead to a
finding resulting in a forfeiture.
(iv) In
the event the Grantee ceases to be employed by, or provide service
to, the Company because the Grantee is Disabled, any Option which
is otherwise exercisable by the Grantee shall terminate unless
exercised within one year after the date on which the Grantee
ceases to be employed by, or provide service to, the Company (or
within such other period of time as may be specified by the Board),
but in any event no later than the date of expiration of the Option
term. Except as otherwise provided by the Board, any of the
Grantee’s Options which are not otherwise exercisable as of
the date on which the Grantee ceases to be employed by, or provide
service to, the Company shall terminate as of such date.
(v) If
the Grantee dies while employed by, or providing service to, the
Company or within 90 days after the date on which the Grantee
ceases to be employed or provide service on account of a
termination specified in Section 5(e)(i) above (or within such
other period of time as may be specified by the Board), any Option
that is otherwise exercisable by the Grantee shall terminate unless
exercised within one year after the date on which the Grantee
ceases to be employed by, or provide service to, the Company (or
within such other period of time as may be specified by the Board),
but in any event no later than the date of expiration of the Option
term. Except as otherwise provided by the Board, any of the
Grantee’s Options that are not otherwise exercisable as of
the date on
which the
Grantee ceases to be employed by, or provide service to, the
Company shall terminate as of such date.
(vi) For
purposes of this Section 5(f) and 6:
(A) The
term “Company” shall mean the Company and its
subsidiaries, as determined by the Board.
(B) “Employed
by, or provide service to, the Company” shall mean employment
or service as an Employee, Key Advisor or member of the Board (so
that, for purposes of exercising Options and satisfying conditions
with respect to Stock Awards, a Grantee shall not be considered to
have terminated employment or service until the Grantee ceases to
be an Employee, Key Advisor and member of the Board), unless the
Board determines otherwise.
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