Exhibit 10.1
NETWORK CN INC.
2007 STOCK OPTION/STOCK
ISSUANCE PLAN
ARTICLE ONE
GENERAL
PROVISIONS
I. PURPOSE
OF THE PLAN
This Plan is intended to promote the
interests of Network CN Inc. (the “Corporation”), by
providing eligible persons employed by or serving the Corporation
or any Subsidiary or Parent with the opportunity to acquire a
proprietary interest, or otherwise increase their proprietary
interest, in the Corporation as an incentive for them to continue
in such employ or service.
Capitalized terms herein shall have
the meanings assigned to such terms in the attached
Appendix.
II. STRUCTURE OF
THE PLAN
A. The Plan shall be divided into
two separate equity programs:
(1) the Option Grant Program under
which eligible persons may, at the discretion of the Plan
Administrator, be granted options to purchase shares of Common
Stock, and
(2) the Stock Issuance Program under
which eligible persons may, at the discretion of the Plan
Administrator, be issued shares of Common Stock directly, either
through the immediate purchase of such shares or as a bonus for
services rendered the Corporation (or any Parent or
Subsidiary).
B. The provisions of Articles One
and Four shall apply to both equity programs under the Plan and
shall accordingly govern the interests of all persons under the
Plan.
III. ADMINISTRATION OF
THE PLAN
A. The Board shall
administer the Plan. However, any or all administrative functions
otherwise exercisable by the Board may be delegated to the
Committee. Members of the Committee shall serve for such period of
time as the Board may determine and shall be subject to removal by
the Board at any time. The Board may also at any time terminate the
functions of the Committee and reassume all powers and authority
previously delegated to the Committee. The initial Committee and
Plan Administrator shall be the Chief Executive Officer of the
Corporation; provided that he/she remains a director of the
Corporation.
B. The Plan
Administrator shall have full power and authority (subject to the
provisions of the Plan) to establish such rules and procedures as
it may deem appropriate for proper administration of the Plan and
to make such determinations under, and issue such interpretations
of, the Plan and any outstanding options or stock issued under the
Plan as it may deem necessary or advisable. Decisions of the Plan
Administrator shall be final and binding on all parties who have an
interest in the Plan or any option grant or stock issued under the
Plan.
C. The Plan
Administrator shall have full authority to determine, (1) with
respect to the grants made under the Option Grant Program, which
eligible persons are to receive such grants, the time or times when
those grants are to be made, the number of shares to be covered by
each such grant, the status of the granted option as either an
Incentive Option or a Non-Statutory Option, the time or times when
each option is to become exercisable, the vesting schedule (if any)
applicable to the option shares and the maximum term for which the
option is to remain outstanding, and (2) with respect to stock
issuances made under the Stock Issuance Program, which eligible
persons are to receive such issuances, the time or times when those
issuances are to be made, the number of shares to be issued to each
Participant, the vesting schedule (if any) applicable to the issued
shares and the consideration to be paid by the Participant for such
shares. Each option grant or stock issuance approved by the Plan
Administrator shall be evidenced by the appropriate
documentation.
IV. ELIGIBILITY
A.
The persons eligible to participate in the Plan are as
follows:
(1) employees;
(2) members of the Board and the
members of the board of directors of any Parent or Subsidiary;
and
(3) independent contractors who
provide services to the Corporation (or any Parent or
Subsidiary).
V. STOCK SUBJECT TO
THE PLAN
A. The shares
issuable under the Plan shall be shares of authorized but unissued
or reacquired shares of Common Stock. The maximum number of shares
of Common Stock that may be issued and outstanding or subject to
options outstanding under the Plan shall not exceed seven million
five hundred thousand (7,500,000) shares.
B. Shares of
Common Stock subject to outstanding options shall be available for
subsequent issuance under the Plan to the extent (1) the options
expire or terminate for any reason prior to exercise in full or (2)
the options are cancelled in accordance with the cancellation and
re-grant provisions of Article Two. Unvested Shares issued under
the Plan and subsequently repurchased by the Corporation, at a
price per share not greater than the option exercise or direct
issue price paid per share, pursuant to the Corporation’s
repurchase rights under the Plan shall be added back to the number
of shares of Common Stock reserved for issuance under the Plan and
shall accordingly be available for reissuance through one or more
subsequent option grants or direct stock issuances under the
Plan.
C. Should
any change be made to the Common Stock by reason of any stock
split, stock dividend, reverse stock split, recapitalization,
combination of shares, exchange of shares or other change affecting
the outstanding Common Stock as a class without the
Corporation’s receipt of consideration, appropriate
adjustments shall be made to (1) the maximum number and/or class of
securities issuable under the Plan and (2) the number and/or class
of securities and the exercise price per share in effect under each
outstanding option in order to prevent the dilution or enlargement
of benefits thereunder. The adjustments determined by the Plan
Administrator shall be final and binding. In no event shall any
such adjustments be made in connection with the conversion of one
or more outstanding shares of the Corporation’s preferred
stock into shares of Common Stock.
D. The grant
of options or the issuance of shares of Common Stock under the Plan
shall in no way affect the right of the Corporation to adjust,
reclassify, reorganize or otherwise change its capital or business
structure or to merge, consolidate, dissolve, liquidate or sell or
transfer all or any part of its business or assets.
ARTICLE TWO
OPTION GRANT
PROGRAM
I OPTION
TERM
A.
Agreement
Each option shall be in such form
and shall contain such terms and conditions as the Board or
Committee shall deem appropriate. All Options shall be separately
designated Incentive Stock Options or Non-Statutory Stock Options
at the time of grant, and, if certificates are issued, a separate
certificate or certificates will be issued for shares of Common
Stock purchased on exercise of each type of Option. The provisions
of separate Options need not be identical, but each Option shall be
subject to the terms and conditions of the Plan:
B.
Exercise Price .
(1) The Plan Administrator shall fix
the exercise price per share, subject to any requirements of U.S.
federal and state securities laws. However, with respect to
Incentive Stock Options, (a) if the option is granted to a 10%
Stockholder, the exercise price per share must not be less than
110% of the Fair Market Value per share of Common Stock on the date
the option is granted, and (b) if the option is granted to an
Optionee who is not a 10% Stockholder, the exercise price per share
shall not be less than 100% of the Fair Market Value per share of
Common Stock on the date the option is granted. Notwithstanding the
foregoing, options may be granted with a per share exercise price
other than as required above pursuant to a merger or other
corporate transaction.
(2) The exercise price shall become
immediately due upon exercise of the option and shall, subject to
the provisions of Section I of Article Four and the documents
evidencing the option, be payable in cash or check made payable to
the Corporation. Should the Common Stock be registered under
Section 12 of the 1934 Act at the time the option is exercised,
then the exercise price (and any applicable withholding taxes) may
also be paid as follows:
(a) in shares of Common Stock held
for the requisite period, if any, necessary to avoid a charge to
the Corporation’s earnings for financial reporting purposes
and valued at Fair Market Value on the Exercise Date, or
(b) to the extent the option is
exercised for Vested Shares, through a special sale and remittance
procedure pursuant to which the Optionee shall concurrently provide
irrevocable instructions (i) to a Corporation-designated brokerage
firm to effect the immediate sale of the purchased shares and remit
to the Corporation, out of the sale proceeds available on the
settlement date, sufficient funds to cover the aggregate exercise
price payable for the purchased shares plus all applicable income
and employment taxes required to be withheld by the Corporation by
reason of such exercise and (ii) to the Corporation to deliver the
certificates for the purchased shares directly to such brokerage
firm in order to complete the sale.
Except to the extent such sale and
remittance procedure is utilized, payment of the exercise price for
the purchased shares must be made on the Exercise Date.
C.
Exercise and Term of Options . Each option shall be
exercisable at such time or times, during such period and for such
number of shares as shall be determined by the Plan Administrator
and set forth in the documents evidencing the option grant.
However, no Incentive Stock Option shall have a term in excess of
ten years measured from the option grant date.
D.
Effect of Termination of Service .
(1) The following provisions shall
govern the exercise of any options granted to the Optionee that
remain outstanding at the time the Optionee’s Service
ceases:
(a) Should the Optionee cease to
remain in Service for any reason other than death, Disability or
Misconduct, then each option shall be exercisable for the number of
shares subject to the option that were Vested Shares at the time
the Optionee’s Service ceased and shall remain exercisable
until the close of business on the earlier of (i) the three
month anniversary of the date Optionee’s Service ceased or
(ii) the expiration date of the option.
(b) Should the Optionee cease to
remain in Service by reason of death or Disability, then each
option shall be exercisable for the number of shares subject to the
option which were Vested Shares at the time of the Optionee’s
Service ceased and shall remain exercisable until the close of
business on the earlier of (i) the twelve month anniversary
of the date Optionee’s Service ceased or (ii) expiration date
of the option.
(c) No additional vesting will occur
after the date the Optionee’s Service ceases, and the option
shall immediately terminate with respect to the Unvested Shares.
Upon the expiration of any post-Service exercise period or (if
earlier) upon the expiration date of the term of the option, the
option shall terminate with respect to the Vested
Shares.
(d) Should the Optionee’s
Service be terminated for Misconduct or should the Optionee
otherwise engage in Misconduct, then each outstanding option
granted to the Optionee shall terminate immediately with respect to
all shares.
(2) Understanding that there may be
adverse tax and accounting consequences to doing so, the Plan
Administrator shall have the discretion, exercisable either at the
time an option is granted or at any time while the option remains
outstanding, to:
(a) extend the period of time for
which the option is to remain exercisable following the
Optionee’s cessation of Service for such period of time as
the Plan Administrator shall deem appropriate, but in no event
beyond the expiration of the option, and/or
(b) permit the option to be
exercised, during the applicable post-Service exercise period, not
only with respect to the number of Vested Shares for which such
option is exercisable at the time of the Optionee’s cessation
of Service but also with respect to one or more additional
installments in which the Optionee would have vested under the
option had the Optionee continued in Service.
E. Stockholder Rights . The
holder of an option shall have no stockholder rights with respect
to the shares subject to the option until such person shall have
exercised the option, paid the exercise price and become the
recordholder of the purchased shares.
F. Unvested Shares . The Plan
Administrator shall have the discretion to grant options that are
exercisable for Unvested Shares. Should the Optionee’s
Service cease while the shares issued upon the early exercise of
the Optionee’s option are still unvested, the Corporation
shall have the right to repurchase, any or all of those Unvested
Shares at the lower of (1) the exercise price paid per
share, or (2) the Fair Market Value per share on the date the
Optionee’s Service ceased. Once the Corporation exercises its
repurchase right, the Optionee shall have no further stockholder
rights with respect to those shares. The terms upon which such
repurchase right shall be exercisable (including the period and
procedure for exercise and the appropriate vesting schedule for the
purchased shares) shall be established by the Plan Administrator
and set forth in the document evidencing such repurchase right. Any
such repurchase must be made in accordance with applicable
corporate law. The Plan Administrator may set the vesting schedule,
subject to applicable U.S. federal and state securities
laws.
G. Limited Transferability of
Options . An Incentive Option shall be exercisable only by
the Optionee during his or her lifetime and shall not be assignable
or transferable other than by will or by the laws of inheritance
following the Optionee’s death. A Non-Statutory Option may be
assigned in whole or in part during the Optionee’s lifetime
to one or more members of the Optionee’s family (as defined
in Rule 701 promulgated by the Securities and Exchange Commission)
or to a trust established exclusively for one or more such family
members or to the Optionee’s former spouse, to the extent
such assignment is in connection with the Optionee’s estate
plan or pursuant to a domestic relations order. The terms
applicable to the assigned portion
shall be the same as those in effect for
the option immediately prior to such assignment and shall be set
forth in such documents issued to the assignee as the Plan
Administrator may deem appropriate.
II. INCENTIVE
OPTIONS
The terms specified below shall be
applicable to all Incentive Options. Except as modified by the
provisions of this Section II, all the provisions of Articles One,
Two and Four shall be applicable to Incentive Options. Options that
are specifically designated as Non-Statutory Options shall not be
subject to the terms of this Section II.
A. Eligibility .
Incentive Options may only be granted to Employees.
B. Dollar Limitation .
The aggregate Fair Market Value of the shares of Common Stock
(determined as of the respective date or dates of grant) for which
one or more options granted to any Employee under the Plan (or any
other option plan of the Corporation or any Parent or Subsidiary)
may for the first time become exercisable as Incentive Options
during any one calendar year shall not exceed $100,000.
C. Term of Option Granted to a
10% Stockholder . If any Employee to whom an Incentive
Option is granted is a 10% Stockholder, then the option term shall
not exceed five years measured from the date the option is
granted.
III. CHANGE IN
CONTROL
A. The shares subject to each option
outstanding under the Plan at the time of a Change in Control shall
automatically become Vested Shares, and each such option shall,
immediately prior to the effective date of the Change in Control,
become exercisable for all of the shares of Common Stock at the
time subject to that option. However, the shares subject to an
outstanding option shall not become Vested Shares on an
accelerated basis if and to the extent: (1) such option is assumed
by the successor corporation (or parent thereof) or otherwise
continued in full force and effect pursuant to the terms of the
Change in Control transaction or (2) such option is to be replaced
with a cash incentive program of the Corporation or any successor
corporation which preserves the spread existing on the Unvested
Shares at the time of the Change in Control and provides for
subsequent payout of that spread no later than the time the
Optionee would vest in those Unvested Shares or (3) the
acceleration of such option is subject to other limitations imposed
by the Plan Administrator.
B. All outstanding repurchase rights
under the Option Grant Program shall also terminate automatically,
and the shares of Common Sto
