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BDC CAPITAL,
INC.
2006 EMPLOYEE STOCK AND OPTION PLAN
I. PURPOSES
BDC CAPITAL, INC., a Minnesota corporation (the
"Company") desires to afford certain of its directors, officers,
key employees, certain non-employees (including consultants) and
certain directors of any subsidiary corporation or parent
corporation of the Company now existing or hereafter formed or
acquired (collectively referred to herein as "Employees") an
opportunity to acquire a proprietary interest in the Company, and
thus to create in such Employees an increased interest in and a
greater concern for the welfare of the Company and its
subsidiaries.
The Company seeks to retain the services of
certain persons now serving as directors and key employees and
consultants to secure the services of persons capable of filling
such positions.
The stock and stock options ("Grant" or
"Options") offered pursuant to the Plan are a matter of separate
inducement and are not in lieu of any salary or other compensation
for the services of any director. The services that shall be
compensated for with such Options and Grants shall be bone fide
services to be performed for the Company, which such services shall
neither be in connection with a capital raising function for the
Company nor in connection with making a market in the Common
Stock.
The Options granted under the Plan are intended
to be options that do not meet the requirements for incentive stock
options within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code").
II. AMOUNT OF STOCK SUBJECT TO THE PLAN
The total number of shares of common stock of
the Company which may be issued pursuant to the exercise of Options
or shares of common stock granted under the Plan shall not exceed,
in the aggregate, 5,000,000 shares of the authorized common stock,
$.001 par value per share, of the Company (the "Shares"), such
number subject to adjustment as provided in Article XIII hereof.
Shares that are the subject of Options shall be counted only once
in determining whether the maximum number of Shares that may be
issued under the Plan has been exceeded.
Shares acquired under the Plan may be either
authorized but unissued Shares or Shares of issued stock held in
the Company's treasury, or both, at the discretion of the Company.
If and to the extent that Options granted under the Plan expire or
terminate without having been exercised, the Shares covered by such
expired or terminated Options shall again become available for
award under the Plan. If shares of Common Stock Granted or issued
under the Plan are reacquired by the Company due to a forfeiture or
for any other reason, such shares shall be cancelled and thereafter
shall again be available for purposes of the Plan.
Except as provided in Article XVIII and subject
to Article II, the Company may, from time to time, grant to certain
officers, directors key employees, and certain non-employees,
including consultants of the Company, or of any subsidiary
corporation or parent corporation of the Company now existing or
hereafter formed or acquired, Options or Grants under the terms
hereinafter set forth.
As used in the Plan, the term "subsidiary
corporation" and "parent corporation" shall mean, respectively, a
corporation coming within the definition of such terms contained in
Sections 424(f) and 424(e) of the Code.
III. ADMINISTRATION
The board of directors of the Company (the
"Board") may designate from among its members a director grant and
stock option committee (the "Committee"), to administer the Plan.
The Committee shall consist of no fewer than two members of the
Board. A majority of the members of the Committee shall constitute
a quorum, and the act of a majority of the members of the Committee
shall be the act of the Committee. Any member of the Committee may
be removed at any time either with or without cause by resolution
adopted by the Board, and any vacancy on the Committee at any time
may be filled by resolution adopted by the Board.
Subject to the express provisions of the Plan,
the Board and the Committee shall have authority, in their
discretion, to determine the Employees to whom Grants or Options
shall be granted, the time when such Grants or Options shall be
granted, the number of Shares which shall be subject to each Grant
or Option, the purchase price or exercise price of each Grant or
Option, the period(s) during which such Options shall become
exercisable (whether in whole or in part) and the other terms and
provisions thereof (which need not be identical).
Subject to the express provisions of the Plan,
the Board and the Committee also shall have authority to construe
the Plan and the Grant and Options granted thereunder, to amend the
Plan and the Grant or Options granted thereunder, to prescribe,
amend and rescind rules and regulations relating to the Plan, to
determine the terms and provisions of the Grants and Options (which
need not be identical) granted thereunder and to make all other
determinations necessary or advisable for administering the Plan.
The Board and the Committee also shall have the authority to
require, in its discretion, as a condition of the granting of any
such Grant or Option, that the Employee agree (i) not to sell or
otherwise dispose of Shares acquired pursuant to a Grant or the
exercise of such Option for a period of six (6) months following
the date of the acquisition of such Grant or Option and (ii) that
in the event of termination of service of such Employee, other than
as a result of removal without cause, such Employee will not, for a
period to be fixed at the time of the grant of the Option or Grant,
enter into any other employment or participate directly or
indirectly in any other business or enterprise which is competitive
with the business of the Company or any subsidiary corporation or
parent corporation of the Company, or enter into any employment in
which such director or key employee will be called upon to utilize
special knowledge obtained through service as an Employee of the
Company or any subsidiary corporation or parent corporation
thereof. In no event will an Employee who is subject to the
reporting requirements of Section 16(a) of the Exchange Act be
entitled to sell or otherwise dispose of any Shares acquired
pursuant to a Grant or exercise of any such Options for a period of
six (6) months from the date of the acquisition of such Grant or
Options.
The determination of the Board or Committee on
matters referred to in this Article III shall be conclusive.
The Board or Committee may employ such legal
counsel, consultants and agents as it may deem desirable for the
administration of the Plan and may rely upon any opinion or
computation received from any such legal counsel, consultant or
agent. Expenses incurred in the engagement of such counsel,
consultant or agent shall be paid by the Company. No member or
former member of the Board or Committee shall be liable for any
action or determination made in good faith with respect to the Plan
or any award of Options granted hereunder.
IV. ELIGIBILITY
The Plan does not create a right in any Employee
to participate in the Plan, nor does it create a right in any
director Employee to have any Grants or Options granted to him or
her.
V. OPTION PRICE AND PAYMENT
The price for each Share purchasable under any
Option granted hereunder shall be such amount as the Committee
shall deem appropriate. If the Committee elects not to set a
specific price for the Option, then the price per share shall be
determined as follows:
If the Shares are listed on a national
securities quotation medium and exchange in the United States
(which, for purposes of this Article V, shall be deemed to include
any last sale reported over-the-counter market), on any date on
which the fair market value per Share shall be deemed to be the
average of the high and low quotations at which such Shares are
sold on such national securities exchange or over-the-counter
market on the date such Option is granted. If the Shares are listed
on a national securities exchange or over-the-counter market in the
United States on such date, but the Shares are not traded on such
date, or such national securities exchange or over-the-counter
market is not open for business on such date, the fair market value
per Share shall be determined as of the closest preceding date on
which such exchange or over-the-counter market shall have been open
for business and the Shares shall have been traded.
If a public market exists for the Shares on any
date on which the fair market value per Share is to be determined
but the Shares are not listed on a national securities exchange in
the United States, the fair market value per Share shall be deemed
to be the mean between the closing bid and asked quotations in the
over-the-counter market for the Shares on such date. If there are
no bid and asked quotations for the Shares on such date, the fair
market value per Share shall be deemed to be the mean between the
closing bid and asked quotations in the over-the-counter market for
the Shares on the closest date preceding such date for which such
quotations are available.
For purposes of this Plan, the determination by
the Committee of the fair market value of a Share shall be
conclusive.
Upon the exercise of an Option granted
hereunder, the Company shall cause the purchased Shares to be
issued only when it shall have received the full purchase price for
the Shares in cash or by certified check; provided, however, that
in lieu of cash, the holder of an Option may, if and to the extent
the terms of such Option so provide and to the extent permitted by
applicable law, exercise an Option (a) in whole or in part, by
delivering to the Company shares of common stock of the Company (in
proper form for transfer and accompanied by all requisite stock
transfer tax stamps or cash in lieu thereof) owned by such holder
having a fair market value equal to the exercise price applicable
to that portion of the Option being exercised by the delivery of
such Shares or (b) in part, by delivering to the Company an
executed promissory note on such terms and conditions as the
Committee shall determine, at the time of grant, in its sole
discretion; provided, however, that the principal amount of such
note shall not exceed eighty percent (80%) (or such lesser
percentage as would be permitted by applicable margin regulations)
of the aggregate purchase price of the Shares then being purchased
pursuant to the exercise of such Option. The fair market value of
the stock so delivered shall be determined as of the date
immediately preceding the date on which the Option is exercised, or
as may be required in order to comply with or to conform to the
requirements of any applicable laws or regulations.
VI. TERM OF OPTIONS AND LIMITATIONS ON THE RIGHT
OF EXERCISE
Any Option shall be exercisable at such times,
in such amounts and during such period or periods as the Board or
Committee shall determine at the date of the grant of such
Option.
Subject to the provisions of Article XIX, the
Board or Committee shall have the right to accelerate, in whole or
in part, from time to time, conditionally or unconditionally,
rights to exercise any Option granted hereunder.
To the extent that an Option is not exercised
within the period of exercisability specified therein, it shall
expire as to the then unexercised part.
In no event shall an Option granted hereunder be
exercised for a fraction of a Share.
VII. EXERCISE OF OPTIONS
Options granted under the Plan shall be
exercised by the optionee as to all or part of the Shares covered
thereby by the giving of written notice of the exercise thereof to
the Corporate Secretary of the Company at the principal business
office of the Company, specifying the number of Shares to be
purchased and specifying a business day not more than fifteen (15)
days from the date such notice is given for the payment of the
purchase price against delivery of the Shares being purchased.
Subject to the terms of Articles XIV, XVI, and XVII, the Company
shall c
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