AMENDED AND RESTATED
FGX INTERNATIONAL HOLDINGS LIMITED
2004 KEY EXECUTIVE STOCK OPTION PLAN
1.
ESTABLISHMENT, EFFECTIVE DATE AND TERM
FGX International
Holdings Limited, a British Virgin Islands international business
company (the “Company”), hereby establishes the
“FGX International Holdings Limited 2004 Key Executive Stock
Option Plan” (f/k/a the Envision Worldwide Holdings Limited
2004 Key Executive Stock Option Plan) (the “Plan”). The
effective date of the Plan shall be September 29, 2004 (the
“Effective Date”), which is the date that the Plan was
originally approved and adopted by the Board of Directors (the
“Board”) and shareholders of the Company. The Amended
and Restated Plan was approved and adopted by the Board and
Shareholders of the Company on December 15, 2005. Unless
earlier terminated pursuant to Section 17 hereof, the Plan
shall terminate on the tenth anniversary of the Effective
Date.
The purpose of the
Plan is to advance the interests of the Company by providing
Eligible Individuals (as defined in Section 6 below) with an
opportunity to acquire or increase a proprietary interest in the
Company, which will thereby create a stronger incentive to expend
maximum effort for the growth and success of the Company, and will
encourage such individuals to remain in the employ of or maintain
their relationship with the Company.
Each stock option
granted under the Plan (an “Option”) may be designated
by the Board, in its sole discretion, either as (i) an
“incentive stock option” (“Incentive Stock
Options”) within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended from time to time (the
“Code”), or (ii) as a non-qualified stock option
(“Non-Qualified Stock Option”) which is not intended to
meet the requirements of Section 422 of the Code; provided,
however , that Incentive Stock Options may only be granted to
employees of the Company, any “subsidiary corporation”
as defined in Section 424 of the Code (a
“Subsidiary”) or any “parent corporation”
as defined in Section 424 of the Code (a
“Parent”). In the absence of any designation, Options
granted under the Plan will be deemed to be Non-Qualified Stock
Options. The Plan shall be administered and interpreted so that all
Incentive Stock Options granted under the Plan will qualify as
incentive stock options under Section 422 of the Code. Options
designated as Incentive Stock Options that fail to continue to meet
the requirements of Section 422 of the Code (including,
without limitation, as a result of the acceleration of the vesting
of any of any Options) shall be redesignated as Non-Qualified Stock
Options automatically on the date of such failure to continue to
meet such requirements without further action by the
Board.
(a) Board .
The Plan shall be administered by the Board, which shall have the
full power and authority to take all actions, and to make all
determinations required or provided for under the Plan or any
Option granted or Option Agreement (as defined in Section 9
below)
entered into
under the Plan and all such other actions and determinations not
inconsistent with the specific terms and provisions of the Plan
deemed by the Board to be necessary or appropriate to the
administration of the Plan or any Option granted or Option
Agreement entered into hereunder. The Board may correct any defect
or supply any omission or reconcile any inconsistency in the Plan
or in any Option Agreement in the manner and to the extent it shall
deem expedient to carry the Plan into effect and shall be the sole
and final judge of such expediency. All such actions and
determinations shall be by the affirmative vote of a majority of
the members of the Board present at a meeting at which any issue
relating to the Plan is properly raised for consideration or
without a meeting by written consent of the Board executed in
accordance with the Company’s Memorandum of Association and
Articles of Association and applicable law. The interpretation and
construction by the Board of any provision of the Plan or of any
Option granted or Option Agreement entered into hereunder shall be
final and conclusive.
(b)
Committee . The Board may, in its discretion, from time to
time appoint a Compensation Committee and/or Stock Option Committee
(each of which is referred to as the “Committee”). In
the event that the Company is a “publicly held
corporation” as defined in Section 162(m)(2) of the Code, the
Board shall appoint a Committee consisting of not less than two
members of the Board, none of whom shall be an officer or other
salaried employee of the Company or any Parent or Subsidiary, and
each of whom shall qualify in all respects as a “non-employee
director” as defined in Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and an “outside director” for purposes of
Section 162(m) of the Code (the “Outside Director
Committee”). The Board, in its sole discretion, may provide
that the role of the Committee shall be limited to making
recommendations to the Board concerning any determinations to be
made and actions to be taken by the Board pursuant to or with
respect to the Plan, or the Board may delegate to the Committee
such powers and authorities related to the administration of the
Plan, as set forth in Section 4(a) above, as the Board shall
determine, consistent with the Memorandum of Association and
Articles of Association of the Company and applicable law. The
Board may remove members, add members and fill vacancies on the
Committee from time to time, all in accordance with the
Company’s Memorandum of Association and Articles of
Association and applicable law. The majority vote of the Committee,
or acts reduced to or approved in writing by a majority of the
members of the Committee, shall be the valid acts of the
Committee.
(c) No
Liability . No member of the Board or of the Committee shall be
liable for any action or determination made in good faith with
respect to the Plan or any Option granted or Option Agreement
entered into hereunder.
(d) Delegation
to the Committee . In the event that the Plan or any Option
granted or Option Agreement entered into hereunder provides for any
action to be taken by or determination to be made by the Board,
such action may be taken by or such determination may be made by
the Committee if the power and authority to do so has been
delegated to the Committee by the Board as provided for in Section
4(b) above. Unless otherwise expressly determined by the Board, any
such action or determination by the Committee shall be final and
conclusive. If the Company is a “publicly held
corporation” as defined in Section 162(m)(2) of the
Code, Options granted to a “covered employee” as
defined in Section 162(m)(3) of the Code (a “Covered
Employee”) shall be made by the Outside Director Committee
and the maximum number of Ordinary Shares (as
2
defined below)
subject to Options that may be granted during any calendar year
under the Plan to any Covered Employee shall be 3.33, unless
otherwise determined by the Board in writing.
The capital stock
of the Company that may be issued pursuant to Options granted under
the Plan shall be ordinary shares, $1.00 par value per share, of
the Company (the “Ordinary Shares”), which shares may
be treasury shares or authorized but unissued shares. The total
number of Ordinary Shares that may be issued pursuant to Options
granted under the Plan shall be 6.8935875 shares, subject to
adjustment as provided in Section 19 below. If any Option
expires, terminates or is terminated or canceled for any reason
prior to exercise in full, the Ordinary Shares that were subject to
the unexercised portion of such Option shall be available for
future Options granted under the Plan.
Options may be
granted under the Plan to senior executives of the Company
(collectively, “Eligible Individuals”). An individual
may hold more than one Option, subject to such restrictions as are
provided herein.
Subject to the
terms and conditions of the Plan, the Board may, at any time and
from time to time, prior to the date of termination of the Plan,
grant to such Eligible Individuals as the Board may determine
(“Optionees”), Options to purchase such number of
Ordinary Shares on such terms and conditions as the Board may
determine. The date on which the Board approves the grant of an
Option (or such later date as is specified by the Board) shall be
considered the date on which such Option is granted.
8.
LIMITATION ON INCENTIVE STOCK OPTIONS
(a) Ten
Percent Shareholder . Notwithstanding any other provision of
this Plan to the contrary, no individual may receive an Incentive
Stock Option under the Plan if such individual, at the time the
award is granted, owns (after application of the rules contained in
Section 424(d) of the Code) stock possessing more than ten percent
(10%) of the total combined voting power of all classes of stock of
the Company, unless (i) the purchase price for each Ordinary
Share subject to such Incentive Stock Option is at least one
hundred and ten percent (110%) of the fair market value of an
Ordinary Share on the date of grant (as determined in good faith by
the Board) and (ii) such Incentive Stock Option is not
exercisable after the date which is five (5) years from the
date of grant.
(b) Limitation
on Grants . The aggregate fair market value (determined with
respect to each Incentive Stock Option at the time such Incentive
Stock Option is granted) of the Ordinary Shares with respect to
which Incentive Stock Options are exercisable for the first time by
an individual during any calendar year (under this Plan or any
other plan of the Company or a Parent or Subsidiary) shall not
exceed $100,000. If an Incentive Stock Option is granted pursuant
to which the aggregate fair market value of shares with respect to
which it first becomes exercisable in any calendar year by an
individual exceeds such $100,000 limitation, the portion
3
of such Option
which is in excess of the $100,000 limitation, and any Options
issued subsequently in the same calendar year, shall be treated as
a non-qualified stock option pursuant to Section 422(d)(1) of
the Code. In the event that an individual is eligible to
participate in any other stock option plan of the Company or any
Parent or Subsidiary which is also intended to comply with the
provisions of Section 422 of the Code, such $100,000
limitation shall apply to the aggregate number of shares for which
Incentive Stock Options may be granted under this Plan and all such
other plans.
All Options
granted pursuant to the Plan shall be evidenced by written
agreements (“Option Agreements”), with shall be
executed by the Company and by the Optionee, in such form or forms
and containing such terms and conditions not inconsistent with the
terms of the Plan as the Board shall from time to time determine.
Option Agreements covering Options granted from time to time or at
the same time need not contain similar provisions; provided,
however , that all such Option Agreements shall comply with all
terms of the Plan.
The purchase price
of each Ordinary Share subject to an Option (the “Option
Price”) shall be fixed by the Board and stated in each Option
Agreement, and subject to the provisions of Section 8(a) above,
shall be not less than one hundred percent (100%) of the fair
market value of an Ordinary Share on the date the Option is
granted. If the Ordinary Shares are then listed on any national
securities exchange, the fair market value shall be the closing
price of an Ordinary Share on such exchange on the last trading day
immediately prior to the date of grant; provided, however ,
that when granting Incentive Stock Options, the B
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