CANYON COPPER
CORP.
2009 STOCK OPTION PLAN
Established August 21, 2009
ARTICLE 1.
THE PLAN
1.1 Title
This plan is entitled the "2009
Stock Option Plan" (the "Plan") of Canyon Copper Corp., a Nevada
corporation (the "Company").
1.2
Purpose
The purpose of the Plan is to
enhance the long-term stockholder value of the Company by offering
opportunities to directors, officers, employees and eligible
consultants of the Company and any Related Company, as defined
below, to acquire and maintain stock ownership in the Company in
order to give these persons the opportunity to participate in the
Company's growth and success, and to encourage them to remain in
the service of the Company or a Related Company.
ARTICLE 2.
DEFINITIONS
2.1
Definitions
The following terms will have the
following meanings in the Plan:
"Award"
means any Option granted under this
Plan.
"Board"
means the Board of Directors of the
Company.
"Cause , " unless otherwise defined in the
instrument evidencing the award or in an employment or services
agreement between the Company or a Related Company and a
Participant, means a material breach of the employment or services
agreement, dishonesty, fraud, misconduct, unauthorized use or
disclosure of confidential information or trade secrets, or
conviction or confession of a crime punishable by law (except minor
violations), in each case as determined by the Plan Administrator,
and its determination shall be conclusive and binding.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time.
"Common Stock"
means the shares of common stock,
par value $0.00001 per share, of the Company.
“Consultant” means any consultant, agent, advisor or
independent contractor who provides services to the Company or a
Related Company, but does not include an officer or director of the
Company.
"Consultant
Participant" means a
Participant who is defined as a Consultant Participant in Article
5.
"Corporate
Transaction," unless
otherwise defined in the instrument evidencing the Award or in a
written employment or services agreement between the Company or a
Related Company and a Participant, means consummation of
either:
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(a)
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a merger or consolidation of the
Company with or into any other corporation, entity or person
or
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(b)
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a sale, lease, exchange or other
transfer in one transaction or a series of related transactions of
all or substantially all the Company's outstanding securities or
all or substantially all the Company's assets; provided, however,
that a Corporate Transaction shall not include a Related Party
Transaction.
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"Disability
, " unless otherwise defined
by the Plan Administrator, means a mental or physical impairment of
the Participant that is expected to result in death or that has
lasted or is expected to last for a continuous period of twelve
(12) months or more and that causes the Participant to be unable,
in the opinion of the Company, to perform his or her duties for the
Company or a Related Company and to be engaged in any substantial
gainful activity.
"Employment Termination
Date" means, with respect
to a Participant, the first day upon which the Participant no
longer has an employment or service relationship with the Company
or any Related Company.
"Exchange Act"
means the Securities Exchange Act of
1934, as amended.
"Fair Market Value"
means the per share value of the
Common Stock determined as follows:
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(a)
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if the Common Stock is listed on
an established stock exchange or exchanges or the NASDAQ National
Market, the lesser of (i) the closing price per share on the date
immediately preceding the date of the granting of the options; or
(ii) the average closing price per share during the ten (10)
trading days immediately preceding such date on the principal
exchange on which it is traded or as reported by NASDAQ;
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(b)
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if the Common Stock is not then
listed on an exchange or the NASDAQ National Market, but is quoted
on the NASDAQ Capital Market, the OTC Bulletin Board service or the
Pink Sheets electronic quotation service, the lesser of (i) the
closing price per share on the date immediately preceding the date
of the granting of the options; or (ii) the average of the closing
bid and ask prices per share for the Common Stock as quoted by
FINRA, the OTC Bulletin Board or the Pink Sheets, as the case may
be, during the ten (10) trading days immediately preceding such
date; or
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(c)
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if there is no such reported
market for the Common Stock for the date in question, then an
amount determined in good faith by the Plan
Administrator.
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"Grant Date"
means the date on which the Plan
Administrator completes the corporate action relating to the grant
of an Award or such later date specified by the Plan Administrator,
and on which all conditions precedent to the grant have been
satisfied, provided that conditions to the exercisability or
vesting of Awards shall not defer the Grant Date.
"Incentive Stock
Option" means an Option
granted with the intention, as reflected in the instrument
evidencing the Option, that it qualify as an "incentive stock
option" as that term is defined in Section 422 of the
Code.
"Non-Qualified Stock
Option" means an Option
other than an Incentive Stock Option.
"Option"
means the right to purchase Common
Stock granted under Article 7.
"Option Expiration
Date" has the meaning set
forth in Article 7.6.
"Option Term"
has the meaning set forth in Article
7.3.
"Participant"
means the person to whom an Award is
granted and who meets the eligibility requirements imposed by
Article 5, including Consultant Participants, as defined in Article
5.
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"Plan
Administrator" has the
meaning set forth in Article 3.1.
"Related Company"
means any entity that, directly or
indirectly, is in control of or is controlled by the
Company.
"Related Party
Transaction" means: (a) a
merger or consolidation of the Company in which the holders of
shares of Common Stock immediately prior to the merger hold at
least a majority of the shares of Common Stock in the Successor
Corporation immediately after the merger; (b) a sale, lease,
exchange or other transaction in one transaction or a series of
related transactions of all or substantially all the Company's
assets to a wholly-owned subsidiary corporation; (c) a mere
reincorporation of the Company; or (d) a transaction undertaken for
the sole purpose of creating a holding company that will be owned
in substantially the same proportion by the persons who held the
Company's securities immediately before such
transaction.
"Securities Act"
means the Securities Act of 1933, as
amended.
"Successor
Corporation" has the
meaning set forth in Article 11.3(a) .
"Vesting Commencement
Date" means the Grant
Date or such other date selected by the Plan Administrator as the
date from which the Option begins to vest for purposes of Article
7.4.
ARTICLE 3.
ADMINISTRATION
3.1 Plan
Administrator
The Plan shall be administered by
the Board or a committee appointed by, and consisting of two or
more members of, the Board (the "Plan Administrator"). If and so
long as the Common Stock is registered under Section 12(b) or 12(g)
of the Exchange Act, the Board shall consider in selecting the
members of any committee acting as Plan Administrator, with respect
to any persons subject or likely to become subject to Section 16 of
the Exchange Act, the provisions regarding (a) "outside directors"
as contemplated by Section 162(m) of the Code and (b) "non-employee
directors" as contemplated by Rule 16b-3 under the Exchange Act.
Committee members shall serve for such term as the Board may
determine, subject to removal by the Board at any time. At any time
when no committee has been appointed to administer the Plan, then
the Board will be the Plan Administrator.
3.2 Administration
and Interpretation by Plan Administrator
Except for the terms and
conditions explicitly set forth in the Plan, the Plan Administrator
shall have exclusive authority, in its discretion, to determine all
matters relating to Awards under the Plan, including the selection
of individuals to be granted Awards, the type of Awards, the number
of shares of Common Stock subject to an Award, all terms,
conditions, restrictions and limitations, if any, of an Award and
the terms of any instrument that evidences the Award. The Plan
Administrator shall also have exclusive authority to interpret the
Plan and the terms of any instrument evidencing the Award and may
from time to time adopt and change rules and regulations of general
application for the Plan's administration. The Plan Administrator's
interpretation of the Plan and its rules and regulations, and all
actions taken and determinations made by the Plan Administrator
pursuant to the Plan, shall be conclusive and binding on all
parties involved or affected. The Plan Administrator may delegate
administrative duties to such of the Company's officers as it so
determines.
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ARTICLE 4.
STOCK SUBJECT TO THE PLAN
4.1 Authorized
Number of Shares
Subject to adjustment from time
to time as provided in this Article 4.1 and in Article 11.1, the
maximum aggregate number of shares of Common Stock available for
issuance under the Plan shall be Seven Million Eight Hundred
Thousand (7,800,000) shares. At any time after October 1, 2009,
and from time to time thereafter, the Board may increase the
maximum aggregate number of shares of the Company’s Common
Stock that may be optioned and sold under the Plan, provided that
the maximum aggregate number of shares of the Company’s
Common Stock that may be optioned and sold under the Plan shall at
no time be greater than 10% of the total number of shares of Common
Stock outstanding.
4.2 Reuse
of Shares
Any shares of Common Stock that
have been made subject to an Award that cease to be subject to the
Award (other than by reason of exercise or settlement of the Award
to the extent it is exercised for or settled in shares) shall again
be available for issuance in connection with future grants of
Awards under the Plan. In the event shares issued under the Plan
are reacquired by the Company pursuant to any forfeiture provision
or right of repurchase, such shares shall again be available for
the purposes of the Plan; provided, however, that the maximum
number of shares that may be issued upon the exercise of Incentive
Stock Options shall equal the share number stated in Article 4.1,
subject to adjustment from time to time as provided in Article
11.1; and provided, further, that for purposes of Article 4.3, any
such shares shall be counted in accordance with the requirements of
Section 162(m) of the Code.
ARTICLE 5.
ELIGIBILITY
5.1 Plan
Eligibility
An Award may be granted to any
officer, director or employee of the Company or a Related Company
that the Plan Administrator from time to time selects. Subject to
the limitations on the grant of Incentive Stock Options under
Article 8 below, an Award may also be granted to any consultant,
agent, advisor or independent contractor who provides services to
the Company or any Related Company (a “Consultant
Participant”), so long as such Consultant Participant: (a) is
a natural person; (b) renders bona fide services that are not in
connection with the offer and sale of the Company's securities in a
capital-raising transaction; and (c) does not directly or
indirectly promote or maintain a market for the Company's
securities.
ARTICLE 6.
AWARDS
6.1
Form and Grant of Awards
The Plan Administrator shall have
the authority, in its sole discretion, to determine the type or
types of Awards to be granted under the Plan. Awards may be granted
singly or in combination.
6.2 Settlement
of Awards
The Company may settle Awards
through the delivery of shares of Common Stock, the granting of
replacement Awards or any combination thereof as the Plan
Administrator shall determine. Any Award settlement, including
payment deferrals, may be subject to such conditions, restrictions
and contingencies as the Plan Administrator shall determine. The
Plan Administrator may permit or require
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the
deferral of any Award payment, subject to such rules and procedures
as it may establish, which may include provisions for the payment
or crediting of interest, or dividend equivalents, including
converting such credits into deferred stock equivalents.
ARTICLE 7.
AWARDS OF OPTIONS
7.1 Grant
of Options
The Plan Administrator shall have
the authority, in its sole discretion, to grant Options to
Participants as Incentive Stock Options or as Non-Qualified Stock
Options, which shall be appropriately designated.
7.2 Option
Exercise Price
The exercise price for shares
purchased under an Option shall be as determined by the Plan
Administrator, provided that:
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(a)
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the exercise price for Options
granted to Participants other than Consultant Participants shall
not be less than the minimum exercise price required by Article 8.3
with respect to Incentive Stock Options and shall not be less than
75% of the Fair Market Value of the Common Stock on the Grant Date
with respect to Non-Qualified Stock Options;
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(b)
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the exercise price for Options
granted to Consultant Participants shall not be less than 75% of
the Fair Market Value of the Common Stock on the Grant
Date.
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7.3 Term
of Options
Subject to earlier termination in
accordance with the terms of the Plan and the instrument evidencing
the Option, the maximum term of an Option (the "Option Term") shall
be as established for that Option by the Plan Administrator or, if
not so established, shall be ten (10) years from the Grant
Date.
7.4 Exercise
of Options
The Plan Administrator shall
establish and set forth in each instrument that evidences an Option
the time at which, or the installments in which, the Option shall
vest and become exercisable, any of which provisions may be waived
or modified by the Plan Administrator at any time.
The Plan Administrator, in its
sole discretion, may adjust the vesting schedule of an Option held
by a Participant who works less than "full-time" as that term is
defined by the Plan Administrator or who takes a Company-approved
leave of absence.
To the extent an Option has
vested and become exercisable, the Option may be exercised in whole
or from time to time in part by delivery to the Company of a
written stock option exercise agreement or notice, in a form and in
accordance with procedures established by the Plan Administrator,
setting forth the number of shares with respect to which the Option
is being exercised, the restrictions imposed on the shares
purchased under such exercise agreement, if any, and such
representations and agreements as may be required by the Plan
Administrator, accompanied by payment in full as described in
Article 7.5. An Option may be exercised only for whole shares and
may not be exercised for less than a reasonable number of shares at
any one time, as determined by the Plan Administrator.
7.5 Payment
of Exercise Price
The exercise price for shares
purchased under an Option shall be paid in full to the Company by
the delivery of consideration equal to the product of the Option
exercise price and the number of shares purchased. Such
consideration must be paid before the Company will issue the shares
being purchased
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and must be
delivered in the form of a check or bank draft or other method of
payment or some combination thereof as may be acceptable
to
