Exhibit 4.8
DIRECTOR STOCK OPTION
AGREEMENT
(NON-QUALIFIED STOCK
OPTION)
THIS DIRECTOR STOCK OPTION AGREEMENT
(the “Agreement”) is entered into and effective
January 10, 2006 (the “Date of Grant”), by and
between Southwest Casino Corporation (the “Company”)
and
(the “Optionee”).
A.
The Company has adopted its 2004
Stock Incentive Plan (the “Plan”) which authorizes the
Board of Directors of the Company, or a committee as provided for
in the Plan (the Board or this committee are referred to as the
“Committee” in this Agreement), to grant incentive
stock options to directors of the Company (as defined in the
Plan).
B.
The Company desires to give the
Optionee an inducement to acquire a proprietary interest in the
Company and an added incentive to advance the interests of the
Company by granting to the Optionee an option to purchase shares of
common stock of the Company under the Plan.
C.
Terms stated but not otherwise
defined in this Agreement have the meanings assigned to those terms
in the Plan.
Accordingly, the parties agree as
follows:
1.
Grant of Option.
The Company hereby grants to the Optionee the
right, privilege, and option (the “Option”) to purchase
150,000 shares (the “Option Shares”) of the
Company’s common stock, $.001 par value (the “Common
Stock”), according to the terms and subject to the conditions
stated in this Agreement and as stated in the Plan. This Option is
not intended to be an “incentive stock option,”
as that term is used in Section 422 of the Internal Revenue
Code of 1986, as amended (the “Code”).
2.
Option Exercise
Price.
The per share price to be paid by
Optionee upon exercise of this Option will be $0.65.
3.
Duration of Option and Time of
Exercise.
3.1
Initial Period
of Exercisability . Subject to Sections 3.2 and
3.3 below, this Option will become exercisable with respect to the
Option Shares in 12 quarterly installments beginning on
December 31, 2005 and continuing on the last day of each
fiscal quarter of the Company, as provided in the table below. The
table below states the initial dates of exercisability of each
installment and the number of Option Shares as to which this Option
will become exercisable on those dates:
|
Initial Date of
Exercisability
|
|
Number of Option Shares
Available for
Exercise at each Date
|
|
Mar. 31, June 30, Sept. 30,
Dec. 31, 2006
|
|
12,500
|
|
Mar. 31, June 30, Sept. 30,
Dec. 31, 2007
|
|
12,500
|
|
Mar. 31, June 30, Sept. 30,
Dec. 31, 2008
|
|
12,500
|
The right to exercise this Option is cumulative
with respect to the Option Shares becoming exercisable on the dates
stated above; provided, however, that in no event will this Option
be
exercisable after, and this Option will become
void and expire as to all unexercised Option Shares at,
5:00 p.m. (Minnesota time) on January 9, 2016 (the
“Time of Termination”).
3.2
Termination of
Service .
(a)
Termination
Due to Mandatory Retirement . If Optionee’s service
with the Board of Directors of the Company is terminated by reason
of the Optionee’s mandatory retirement in accordance with the
policies of the Company and its Board of Directors, this Option
will continue to become exercisable and remain exercisable as if
the Optionee continued to serve as a Director of the Company (but
not after the Time of Termination).
(b)
Termination
Due to Death or Disability . If Optionee’s service
with the Board of Directors of the Company is terminated by reason
of the Optionee’s death or Disability, this Option will
become immediately exercisable in full as of the date of death or
Disability and remain exercisable for a period of 12 months after
such termination (but not after the Time of
Termination).
(c)
Termination
for Reasons Other Than Death, Disability or Retirement
. Except as
provided in Section 3.3, if Optionee’s service with the
Board of Directors is terminated for any reason other than death,
Disability or mandatory retirement, this Option will remain
exercisable to the extent exercisable on the date of termination of
Optionee’s service on the Board of Directors and remain
exercisable for a period of 90 days after such
termination.
3.3
Change in
Control .
(a)
Impact of
Change in Control . If a Change in Control of
the Company occurs whereby the acquiring entity or successor to the
Company does not assume this Option or replace it with a
substantially equivalent incentive award, then, as of the date of
the Change of Control, this Option will vest as to all shares and
become immediately exercisable in full and will remain exercisable
until the Time of Termination, regardless of whether the Optionee
remains in the service of the Company. In addition, if a change in
control occurs, the Committee, in its sole discretion and without
consent of the Optionee, may determine that the Optionee will
receive, with respect to some or all of the Option Shares, cash in
the amount of the excess of the Fair Market Value (as defined in
the Plan) of those Option Shares immediately before the effective
date of the Change in Control over the per share exercise price of
this Option.
(b)
Limitation on
Change in Control Payments . Notwithstanding anything
in this Section 3.3 to the contrary, if, with respect to the
Optionee, the acceleration of the vesting of this Option as
provided above (which acceleration could be deemed a
“payment” within the meaning of
Section 280G(b)(2) of the Code), together with any other
payments that the Optionee has the right to receive from the
Company or any corporation which is a member of an
“affiliated group” (as defined in
Section 1504(a) of the Code without regard to
Section 1504(b) of the Code) of which the Company is a
member, would constitute a “parachute payment” (as
defined in Section 280G(b)(2) of the Code), the payments
to the Optionee stated herein will be reduced to the largest amount
that will result in no portion of the payments being subject to the
excise tax imposed by Section 4999 of the Code; provided,
however, that if the Optionee is subject to a separate agreement
with the Company that expressly addresses the potential
2
application of
Sections 280G or 4999 of the Code (i
|
