Beneficial Ownership of Common Stock
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Name and Address
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|
|
|
|
|
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Directors and Named Executive
Officers:
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|
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S. James Miller, Jr., Chair of the
Board (3)
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2,805,784
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2.2%
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David Carey, Director (4)
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274,856
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*
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John Cronin, Director (5)
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235,356
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*
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Neal Goldman, Director (6)
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42,349,724
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31.9%
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G. Steve Hamm, Director (7)
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274,942
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*
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Dana W. Kammersgard, Director (8)
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233,170
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*
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David Loesch, Director (9)
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303,064
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*
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Kristin
Taylor, Chief Executive Officer
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0
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*
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Wayne Wetherell, Chief Financial Officer and
Secretary (10)
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828,101
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*
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David Harding, Chief Technical Officer
(11)
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1,180,025
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*%
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|
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Total beneficial ownership of directors and Named Executive
Officers as a group (11 persons):
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48,485,021
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32.6%
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* less than 1%
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(1)
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All entries exclude beneficial ownership of shares issuable
pursuant to options that have not vested or that are not otherwise
exercisable as of the date hereof, or which will not become vested
or exercisable within 60 days of the Record Date.
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|
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(2)
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Percentages are rounded to nearest one-tenth of one percent.
Percentages are based on 123,571,472 shares of Common Stock
outstanding as of the Record Date. Options that are presently
exercisable or exercisable within 60 days of the Record Date are
deemed to be beneficially owned by the stockholder holding the
options for the purpose of computing the percentage ownership of
that stockholder, but are not treated as outstanding for the
purpose of computing the percentage of any other
stockholder.
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(3)
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Includes 75,201 shares held jointly with spouse,
1,708,002 shares issuable upon exercise of stock options, each
exercisable within 60 days of the Record Date, and 90,411 shares
issuable upon the conversion of Series A Preferred, and 3,987
shares issuable upon the exercise of warrants.
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|
|
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(4)
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Includes 168,170 shares issuable upon exercise of stock options
exercisable within 60 days of the Record Date.
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|
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(5)
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Includes 195,670 shares issuable upon exercise of stock options
exercisable within 60 days of the Record Date.
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|
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(6)
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Includes 8,529,370 shares issuable upon the conversion of Series A
Preferred and 145,670 shares issuable upon exercise of stock
options, each exercisable within 60 days of the Record Date. Mr.
Goldman exercises sole voting and dispositive power over 33,298,556
shares, and shared voting and dispositive power over 3,147,700
reported shares, of which 3,000,000 shares are owned by the Goldman
Family 2012 GST Trust and 147,700 shares are owed by The Neal and
Marlene Goldman Foundation, and 376,128 shares issuable upon the
exercise of warrants.
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|
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(7)
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Includes 170,670 shares issuable upon exercise of stock options
exercisable within 60 days of the Record Date.
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|
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(8)
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Includes 147,670 shares issuable upon exercise of stock options
exercisable within 60 days of the Record Date.
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|
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(9)
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Includes 168,170 shares issuable upon exercise of stock options,
each exercisable within 60 days of the Record Date.
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(10)
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Includes
500,874 shares issuable upon exercise of stock options exercisable
within 60 days of the Record Date.
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(11)
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Includes 1,130,025 shares issuable upon exercise of stock options
exercisable within 60 days of the Record Date.
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ADDITIONAL INFORMATION
We file
annual, quarterly and current reports, proxy statements and other
documents with the SEC under the Securities Exchange Act of 1934.
The public may read and copy any materials that we file with the
SEC at the SEC’s Public Reference Room at 100 F Street NE.,
Washington, DC 20549. The public may obtain information on the
operation of the Public Reference Room by calling the SEC at
1-800-SEC-0330. Also, the SEC maintains an Internet website that
contains reports, proxy and information statements, and other
information regarding issuers, including us, that file
electronically with the SEC. The public can obtain any documents
that we file with the SEC at www.sec.gov.
Householding of Proxy Materials
The SEC
has adopted rules that permit companies and intermediaries (e.g.,
brokers) to satisfy the delivery requirements for proxy statements
and annual reports with respect to two or more stockholders sharing
the same address by delivering a single proxy statement and annual
report addressed to those stockholders. This process, which is
commonly referred to as “householding,” potentially
means extra convenience for stockholders and cost savings for
companies.
A
number of brokers with account holders who are stockholders of the
Company will be “householding” the Company’s
proxy materials. A single set of the Company’s proxy
materials will be delivered to multiple stockholders sharing an
address unless contrary instructions have been received from the
affected stockholders. Once you have received notice from your
broker that they will be “householding” communications
to your address, “householding” will continue until you
are notified otherwise or until you revoke your consent. If, at any
time, you no longer wish to participate in
“householding” and would prefer to receive a separate
set of the Company’s proxy materials, please notify your
broker or direct a written request to the Company at 13500 Evening Creek Drive N., Suite 550, San
Diego, CA 92128, or contact us at (858) 673-8600. The
Company undertakes to deliver promptly, upon any such oral or
written request, a separate copy of its proxy materials to a
stockholder at a shared address to which a single copy of these
documents was delivered. Stockholders who currently receive
multiple copies of the Company’s proxy materials at their
address and would like to request “householding” of
their communications should contact their broker, bank or other
nominee, or contact the Company at the above address or phone
number.
Deadline for Receipt of Stockholder Proposals
Pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934, as amended, stockholder proposals to be
included in our next proxy statement must be received by us at our
principal executive offices at 13500 Evening Creek Drive N., Suite
550, San Diego, CA 92128, addressed to our Corporate Secretary, no
later than [●]. These proposals must comply with applicable
Delaware law, the rules and regulations promulgated by the SEC and
the procedures set forth in our Bylaws.
We
reserve the right to reject, rule out of order, or take other
appropriate action with respect to any proposal that does not
comply with these and all other applicable
requirements.
Stockholder Communications with the Board of Directors
Our
Board of Directors provides stockholders with the ability to send
communications to the Board of Directors, and stockholders may do
so at their convenience. In particular, stockholders may send their
communications to: ImageWare Systems, Inc., c/o Corporate
Secretary, 13500 Evening Creek Drive N., Suite 550, San Diego, CA
92128. All communications received by the Corporate Secretary are
relayed to the Board.
APPENDIX A
CERTIFICATE OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
OF
IMAGEWARE SYSTEMS, INC.
ImageWare
System, Inc., a Delaware corporation (the "Corporation"), does hereby certify that:
FIRST:
This Certificate of Amendment amends
the provisions of the Corporation's Certificate of Incorporation,
as amended (the "Certificate of
Incorporation").
SECOND:
The terms and provisions of this
Certificate of Amendment have been duly adopted in accordance with
Sections 228 and 242 of the General Corporation Law of the State of
Delaware, and shall become effective at 9:00 A.M., Eastern Time, on
April [●], 2020.
THIRD:
Article 4.a) of the Certificate of
Incorporation is hereby amended by deleting such Article in its
entirety and replacing it with the following:
“a) The total number of shares of all classes of stock
that the Corporation is authorized to issue is Three Hundred and
Fifty Million (350,000,000) shares, consisting of Three Hundred and
Forty Five Million (345,000,000) shares of Common Stock with a
par value of $0.01 per share (“Common
Stock”), and Five Million
(5,000,000) shares of Preferred Stock with a par value of $0.01 per
share (“Preferred
Stock”).”
IN
WITNESS WHEREOF, the
Corporation has caused this Certificate of Amendment to be signed
by its officers thereunto duly authorized this ___ day
of [●], 2020.
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/s/
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Wayne Wetherell
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Chief Financial Officer and Corporate Secretary
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APPENDIX B
IMAGEWARE SYSTEMS, INC.
2019 OMNIBUS EQUITY INCENTIVE PLAN
IMAGEWARE SYSTEMS, INC.
2020 OMNIBUS EQUITY INCENTIVE PLAN
ImageWare
Systems, Inc., a Nevada corporation, sets forth herein the terms of
its 2020 Omnibus Equity Incentive Plan, as follows:
The
Plan is intended to enhance the Company’s and its
Affiliates’ (as defined herein) ability to attract and retain
highly qualified officers, Non-Employee Directors (as defined
herein), key employees, consultants and advisors, and to motivate
such officers, Non-Employee Directors, key employees, consultants
and advisors to serve the Company and its Affiliates and to expend
maximum effort to improve the business operations, prospects and
results of the Company, by providing to such persons an opportunity
to acquire or increase a direct proprietary interest in the
operations and future success of the Company. To this end,
the Plan provides for the grant of stock options, stock
appreciation rights, restricted stock, restricted stock units,
other stock-based awards and cash awards. Any of these awards may,
but need not, be made as performance incentives to reward
attainment of performance goals in accordance with the terms
hereof. Stock options granted under the Plan may be non-qualified
stock options or incentive stock options, as provided herein.
Upon becoming effective, the Plan replaces, and no further awards
shall be made under, the Predecessor Plans (as defined
herein).
For
purposes of interpreting the Plan and related documents (including
Award Agreements), the following definitions shall
apply:
2.1 “Affiliate” means
any company or other trade or business that “controls,”
is “controlled by” or is “under common
control” with the Company within the meaning of Rule 405 of
Regulation C under the Securities Act, including, without
limitation, any Subsidiary.
2.2 “Award”
means a grant of an Option, Stock Appreciation Right, Restricted
Stock, Restricted Stock Unit, or Other Stock-based Award under the
Plan.
2.3 “Award
Agreement” means a
written agreement between the Company and a Grantee, or notice from
the Company or an Affiliate to a Grantee that evidences and sets
forth the terms and conditions of an Award.
2.4 “Beneficial
Owner” means
“Beneficial Owner” as defined in Rule 13d-3 and Rule
13d-5 under the Exchange Act; except that, in calculating the
beneficial ownership of any particular Person, such Person shall be
deemed to have beneficial ownership of all securities that such
Person has the right to acquire by conversion or exercise of other
securities, whether such right is currently exercisable or is
exercisable only after the passage of time. The term
“Beneficial Ownership” has a corresponding
meaning.
2.5 “Board”
means the Board of Directors of the Company.
2.6 “Change
in Control” shall have
the meaning set forth in Section 14.3.2.
2.7 “Code”
means the Internal Revenue Code of 1986, as now in effect or as
hereafter amended. References to the Code shall include the valid
and binding governmental regulations, court decisions and other
regulatory and judicial authority issued or rendered
thereunder.
2.8 “Committee”
means the Compensation Committee of the Board or any committee or
other person or persons designated by the Board to administer the
Plan. The Board will cause the Committee to satisfy the
applicable requirements of any stock exchange on which the Common
Stock may then be listed. For purposes of Awards to Grantees
who are subject to Section 16 of the Exchange Act, Committee means
all of the members of the Committee who are “non-employee
directors” within the meaning of Rule 16b-3 adopted under the
Exchange Act. All references in the Plan to the Board shall
mean such Committee or the Board.
2.9 “Company”
means ImageWare Systems, Inc., a Delaware corporation, or any
successor corporation.
2.10
“Common
Stock” or
“Stock” means a share of common stock of the
Company, par value $0.01 per share.
2.11 “Corporate
Transaction” means a
reorganization, merger, statutory share exchange, consolidation,
sale of all or substantially all of the Company’s assets, or
the acquisition of assets or stock of another entity by the
Company, or other corporate transaction involving the Company or
any of its Subsidiaries.
2.12
“Effective
Date” means March 19,
2020, the date the Plan was approved by the
Board.
2.13 “Exchange
Act” means the Securities
Exchange Act of 1934, as now in effect or as hereafter
amended.
2.14 “Fair Market
Value” of a share of
Common Stock as of a particular date means (i) if the Common Stock
is listed on a national securities exchange, the closing or last
price of the Common Stock on the composite tape or other comparable
reporting system for the applicable date, or if the applicable date
is not a trading day, the trading day immediately preceding the
applicable date, or (ii) if the shares of Common Stock are not then
listed on a national securities exchange, the closing or last price
of the Common Stock quoted by an established quotation service for
over-the-counter securities, or (iii) if the shares of Common Stock
are not then listed on a national securities exchange or quoted by
an established quotation service for over-the-counter securities,
or the value of such shares is not otherwise determinable, such
value as determined by the Board in good faith in its sole
discretion.
2.15 “Family
Member” means a person
who is a spouse, former spouse, child, stepchild, grandchild,
parent, stepparent, grandparent, niece, nephew, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother, sister,
brother-in-law, or sister-in-law, including adoptive relationships,
of the applicable individual, any person sharing the applicable
individual’s household (other than a tenant or employee), a
trust in which any one or more of these persons have more than
fifty percent of the beneficial interest, a foundation in which any
one or more of these persons (or the applicable individual) control
the management of assets, and any other entity in which one or more
of these persons (or the applicable individual) own more than fifty
percent of the voting interests.
2.16 “Grant Date” means, as determined by the Board, the
latest to occur of (i) the date as of which the Board approves an
Award, (ii) the date on which the recipient of an Award first
becomes eligible to receive an Award under Section 6 hereof, or
(iii) such other date as may be specified by the Board in the Award
Agreement.
2.17 “Grantee” means a person who receives or holds an
Award under the Plan.
2.18 “Incentive Stock
Option” means an
“incentive stock option” within the meaning of Section
422 of the Code, or the corresponding provision of any subsequently
enacted tax statute, as amended from time to
time.
2.19 “Non-Employee
Director” means a member
of the Board who is not an officer or employee of the Company or
any Subsidiary.
2.20 “Non-qualified Stock
Option” means an Option
that is not an Incentive Stock Option.
2.21 “Option” means an option to purchase one or more
shares of Stock pursuant to the Plan.
2.22
“Option
Price” means the exercise
price for each share of Stock subject to an
Option.
2.23 “Other Stock-based
Awards” means Awards
consisting of Stock units, or other Awards, valued in whole or in
part by reference to, or otherwise based on, Common Stock, other
than Options, Stock Appreciation Rights, Restricted Stock, and
Restricted Stock Units.
2.24 “Person” means an individual, entity or group
within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange
Act.
2.25 “Plan” means this ImageWare Systems, Inc. 2020
Omnibus Equity Incentive Plan, as amended from time to
time.
2.26 “Predecessor
Plans” means the
ImageWare Systems, Inc. Amended and Restated 1999 Stock Award Plan
and the 2001 Equity Incentive Plan.
2.27 “Purchase
Price” means the purchase
price for each share of Stock pursuant to a grant of Restricted
Stock.
2.28 “Restricted
Period” shall have the
meaning set forth in Section 10.1 hereof.
2.29 “Restricted
Stock” means shares of
Stock, awarded to a Grantee pursuant to Section 10
hereof.
2.30 “Restricted Stock
Unit” means a bookkeeping
entry representing the equivalent of shares of Stock, awarded to a
Grantee pursuant to Section 10 hereof.
2.31 “SAR Exercise
Price” means the per
share exercise price of a SAR granted to a Grantee under Section 9
hereof.
2.32 “SEC” means the United States Securities and
Exchange Commission.
2.33 “Section
409A” means Section 409A
of the Code.
2.34 “Securities
Act” means the Securities
Act of 1933, as now in effect or as hereafter
amended.
2.35 “Separation from
Service” means a
termination of Service by a Service Provider, as determined by the
Board, which determination shall be final, binding and conclusive;
provided if any Award governed by Section 409A is to be distributed
on a Separation from Service, then the definition of Separation
from Service for such purposes shall comply with the definition
provided in Section 409A.
2.36 “Service” means service as a Service Provider to the
Company or an Affiliate. Unless otherwise stated in the applicable
Award Agreement, a Grantee’s change in position or duties
shall not result in interrupted or terminated Service, so long as
such Grantee continues to be a Service Provider to the Company or
an Affiliate.
2.37
“Service
Provider” means an
employee, officer, Non-Employee Director, consultant or advisor of
the Company or an Affiliate.
2.38 “Stock Appreciation
Right” or
“SAR” means a right granted to a Grantee under
Section 9 hereof.
2.39 “Subsidiary” means any “subsidiary
corporation” of the Company within the meaning of Section
424(f) of the Code.
2.40 “Substitute
Award” means any Award
granted in assumption of or in substitution for an award of a
company or business acquired by the Company or a Subsidiary or with
which the Company or an Affiliate combines.
2.41 “Ten Percent
Stockholder” means an
individual who owns more than ten percent (10%) of the total
combined voting power of all classes of outstanding stock of the
Company, its parent or any of its Subsidiaries. In determining
stock ownership, the attribution rules of Section 424(d) of the
Code shall be applied.
2.42 “Termination
Date” means the date that
is ten (10) years after the Effective Date, unless the Plan is
earlier terminated by the Board under Section 5.2
hereof.
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3.
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ADMINISTRATION OF THE PLAN
|
3.1
General.
The
Board shall have such powers and authorities related to the
administration of the Plan as are consistent with the
Company’s articles of incorporation and bylaws and applicable
law. The Board shall have the power and authority to delegate its
responsibilities hereunder to the Committee, which shall have full
authority to act in accordance with its charter, and with respect
to the authority of the Board to act hereunder, all references to
the Board shall be deemed to include a reference to the Committee,
to the extent such power or responsibilities have been
delegated. Except as otherwise may be required by applicable
law, regulatory requirement or the articles of incorporation or the
bylaws of the Company, the Board shall have full power and
authority to take all actions and to make all determinations
required or provided for under the Plan, any Award or any Award
Agreement, and shall have full power and authority to take all such
other actions and make all such other determinations not
inconsistent with the specific terms and provisions of the Plan
that the Board deems to be necessary or appropriate to the
administration of the Plan. The Committee shall administer
the Plan; provided that, the Board shall retain the right to
exercise the authority of the Committee to the extent consistent
with applicable law and the applicable requirements of any
securities exchange on which the Common Stock may then be
listed. The interpretation and construction by the Board of
any provision of the Plan, any Award or any Award Agreement shall
be final, binding and conclusive. Without limitation, the Board
shall have full and final authority, subject to the other terms and
conditions of the Plan, to:
(i)
designate Grantees;
(ii)
determine the type or types of Awards to be made to a
Grantee;
(iii)
determine the number of shares of Stock to be subject to an
Award;
(iv)
establish the terms and conditions of each Award (including, but
not limited to, the Option Price of any Option, the nature and
duration of any restriction or condition (or provision for lapse
thereof) relating to the vesting, exercise, transfer, or forfeiture
of an Award or the shares of Stock subject thereto, and any terms
or conditions that may be necessary to qualify Options as Incentive
Stock Options);
(v)
prescribe the form of each Award Agreement; and
(vi)
amend, modify, or supplement the terms of any outstanding Award
including the authority, in order to effectuate the purposes of the
Plan, to modify Awards to foreign nationals or individuals who are
employed outside the United States to recognize differences in
local law, tax policy, or custom.
3.2
Clawbacks.
Awards
shall be subject to the requirements of (i) Section 954 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act
(regarding recovery of erroneously awarded compensation) and any
implementing rules and regulations thereunder, (ii) similar rules
under the laws of any other jurisdiction, (iii) any compensation
recovery policies adopted by the Company to implement any such
requirements or (iv) any other compensation recovery policies as
may be adopted from time to time by the Company, all to the extent
determined by the Committee in its discretion to be applicable to a
Grantee.
3.3
Minimum Vesting Conditions.
Notwithstanding
any other provision of the Plan to the contrary, no more than 25%
of any equity-based Awards granted under the Plan shall vest on the
date the Award is granted, excluding, for this purpose, any (i)
Substitute Awards and (ii) shares delivered in lieu of fully vested
cash incentive compensation under any applicable plan or program of
the Company;and, provided, however, for the avoidance of doubt,
that the foregoing restriction does not apply to the Board’s
discretion to provide for accelerated exercisability or vesting of
any Award, including in cases of retirement, death, disability or a
Change in Control, in the terms of the Award or
otherwise.
3.4
Deferral Arrangement.
The
Board may permit or require the deferral of any Award payment into
a deferred compensation arrangement, subject to such rules and
procedures as it may establish and in accordance with Section 409A,
which may include provisions for the payment or crediting of
interest or dividend equivalents, including converting such credits
into deferred Stock units.
3.5
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, any Award or Award Agreement.
3.6
Book Entry.
Notwithstanding
any other provision of this Plan to the contrary, the Company may
elect to satisfy any requirement under this Plan for the delivery
of stock certificates through the use of book-entry.
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4.
|
STOCK SUBJECT TO THE PLAN
|
4.1
Authorized Number of Shares
Subject
to adjustment under Section 14, the total number of shares of
Common Stock authorized to be awarded under the Plan shall not
exceed 25.0 million. In addition, shares of Common Stock
authorized and/or underlying any outstanding award granted under
the Predecessor Plans that, following the Effective Date, expires,
or is terminated, surrendered or forfeited for any reason without
issuance of such shares shall be available for the grant of new
Awards under this Plan. As provided in Section 1, no new
awards shall be granted under the Predecessor Plans following the
Effective Date. Shares issued under the Plan may consist in
whole or in part of authorized but unissued shares, treasury
shares, or shares purchased on the open market or otherwise, all as
determined by the Company from time to time.
4.2
Share Counting
4.2.1 General
Each
share of Common Stock granted in connection with an Award shall be
counted as one share against the limit in Section 4.1, subject to
the provisions of this Section 4.2.
4.2.2 Cash-Settled
Awards
Any
Award settled in cash shall not be counted as shares of Common
Stock for any purpose under this Plan.
4.2.3 Expired
or Terminated Awards
If
any Award under the Plan expires, or is terminated, surrendered or
forfeited, in whole or in part, without issuance or delivery of
vested shares, the unissued or surrendered Common Stock covered by
such Award shall again be available for the grant of Awards under
the Plan.
4.2.4 Payment
of Option Price or Tax Withholding in Shares
The
full number of shares of Common Stock with respect to which an
Option or SAR is granted shall count against the aggregate number
of shares available for grant under the Plan. Accordingly, if
in accordance with the terms of the Plan, a Grantee pays the Option
Price for an Option by either tendering previously owned shares or
having the Company withhold shares, then such shares surrendered to
pay the Option Price shall continue to count against the aggregate
number of shares available for grant under the Plan set forth in
Section 4.1 above. In addition, if in accordance with the
terms of the Plan, a Grantee satisfies any tax withholding
requirement with respect to any taxable event arising as a result
of this Plan for any Award (including Restricted Stock and
Restricted Stock Units) by either tendering previously owned shares
or having the Company withhold shares, then such shares surrendered
to satisfy such tax withholding requirements shall continue to
count against the aggregate number of shares available for grant
under the Plan set forth in Section 4.1 above. Any shares of
Common Stock repurchased by the Company with cash proceeds from the
exercise of Options shall not be added back to the pool of shares
available for grant under the Plan set forth in Section 4.1
above.
4.2.5 Substitute
Awards
In
the case of any Substitute Award, such Substitute Award shall not
be counted against the number of shares reserved under the
Plan.
|
5.
|
EFFECTIVE DATE, DURATION, AND AMENDMENTS
|
5.1
Term.
The
Plan shall be effective as of the Effective Date, provided that it
has been approved by the Company’s stockholders. The
Plan shall terminate automatically on the ten (10) year anniversary
of the Effective Date and may be terminated on any earlier date as
provided in Section 5.2.
5.2
Amendment and Termination of the Plan.
The
Board may, at any time and from time to time, amend, suspend, or
terminate the Plan as to any Awards which have not been made. An
amendment shall be contingent on approval of the Company’s
stockholders to the extent stated by the Board, required by
applicable law or required by applicable stock exchange listing
requirements. No Awards shall be made after the Termination
Date. The applicable terms of the Plan, and any terms and
conditions applicable to Awards granted prior to the Termination
Date shall survive the termination of the Plan and continue to
apply to such Awards. No amendment, suspension, or
termination of the Plan shall, without the consent of the Grantee,
materially impair rights or obligations under any Award theretofore
awarded.
|
6.
|
AWARD ELIGIBILITY AND LIMITATIONS
|
6.1
Service Providers.
Subject
to this Section 6.1, Awards may be made to any Service Provider,
including any Service Provider who is an officer, Non-Employee
Director, consultant or advisor of the Company or of any Affiliate,
as the Board shall determine and designate from time to time in its
discretion.
6.2
Successive Awards.
An
eligible person may receive more than one Award, subject to such
restrictions as are provided herein.
6.3 Stand-Alone,
Additional, Tandem, and Substitute Awards.
Awards
may, in the discretion of the Board, be granted either alone or in
addition to, in tandem with, or in substitution or exchange for,
any other Award or any award granted under another plan of the
Company, any Affiliate, or any business entity to be acquired by
the Company or an Affiliate, or any other right of a Grantee to
receive payment from the Company or any Affiliate. Such additional,
tandem, and substitute or exchange Awards may be granted at any
time. If an Award is granted in substitution or exchange for
another Award, the Board shall have the right to require the
surrender of such other Award in consideration for the grant of the
new Award. The Board shall have the right, in its discretion, to
make Awards in substitution or exchange for any other award under
another plan of the Company, any Affiliate, or any business entity
to be acquired by the Company or an Affiliate. In addition, Awards
may be granted in lieu of cash compensation, including in lieu of
cash amounts payable under other plans of the Company or any
Affiliate, in which the value of Stock subject to the Award is
equivalent in value to the cash compensation (for example,
Restricted Stock Units or Restricted Stock).
Each
Award shall be evidenced by an Award Agreement, in such form or
forms as the Board shall from time to time determine, consistent
with the terms of the Plan. Without limiting the foregoing,
an Award Agreement may be provided in the form of a notice which
provides that acceptance of the Award constitutes acceptance of all
terms of the Plan and the notice. Award Agreements granted
from time to time or at the same time need not contain similar
provisions but shall be consistent with the terms of the
Plan. Each Award Agreement evidencing an Award of Options
shall specify whether such Options are intended to be Non-qualified
Stock Options or Incentive Stock Options, and in the absence of
such specification such options shall be deemed Non-qualified Stock
Options.
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8.
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TERMS AND CONDITIONS OF OPTIONS
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8.1
Option Price.
The Option Price of each Option shall be fixed by
the Board and stated in the related Award Agreement. The Option
Price of each Option (except those that constitute Substitute
Awards) shall be at least the Fair Market Value on the Grant Date
of a share of Stock;provided, however, that in the event that a Grantee is a Ten
Percent Stockholder as of the Grant Date, the Option Price of an
Option granted to such Grantee that is intended to be an Incentive
Stock Option shall be not less than 110 percent of the Fair Market
Value of a share of Stock on the Grant Date. In no case shall
the Option Price of any Option be less than the par value of a
share of Stock.
8.2
Vesting.
Subject
to Section 8.3 hereof, each Option shall become exercisable at
such times and under such conditions (including, without
limitation, performance requirements) as shall be determined by the
Board and stated in the Award Agreement.
8.3
Term.
Each Option shall terminate, and all rights to
purchase shares of Stock thereunder shall cease, upon the
expiration of ten (10) years from the Grant Date, or
under such circumstances and on such date prior thereto as is set
forth in the Plan or as may be fixed by the Board and stated in the
related Award Agreement;provided, however, that in the event that the Grantee is a Ten
Percent Stockholder, an Option granted to such Grantee that is
intended to be an Incentive Stock Option at the Grant Date shall
not be exercisable after the expiration of five (5) years from its
Grant Date.
8.4
Limitations on Exercise of Option.
Notwithstanding
any other provision of the Plan, in no event may any Option be
exercised, in whole or in part, (i) prior to the date the Plan is
approved by the stockholders of the Company as provided herein or
(ii) after the occurrence of an event which results in termination
of the Option.
8.5
Method of Exercise.
An
Option that is exercisable may be exercised by the Grantee’s
delivery of a notice of exercise to the Company, setting forth the
number of shares of Stock with respect to which the Option is to be
exercised, accompanied by full payment for the shares. To be
effective, notice of exercise must be made in accordance with
procedures established by the Company from time to
time.
8.6
Rights of Holders of Options.
Unless
otherwise stated in the related Award Agreement, an individual
holding or exercising an Option shall have none of the rights of a
stockholder (for example, the right to receive cash or dividend
payments or distributions attributable to the subject shares of
Stock or to direct the voting of the subject shares of Stock) until
the shares of Stock covered thereby are fully paid and issued to
her/him. Except as provided in Section 14 hereof or the related
Award Agreement, no adjustment shall be made for dividends,
distributions or other rights for which the record date is prior to
the date of such issuance.
8.7
Delivery of Stock Certificates.
Promptly
after the exercise of an Option by a Grantee and the payment in
full of the Option Price, such Grantee shall be entitled, subject
to any transaction fees, as required, to the issuance of a stock
certificate or certificates evidencing his or her ownership of the
shares of Stock subject to the Option.
8.8
Limitations on Incentive Stock
Options.
An
Option shall constitute an Incentive Stock Option only (i) if the
Grantee of such Option is an employee of the Company or any
Subsidiary of the Company; (ii) to the extent specifically provided
in the related Award Agreement; and (iii) to the extent that the
aggregate Fair Market Value (determined at the time the Option is
granted) of the shares of Stock with respect to which all Incentive
Stock Options held by such Grantee become exercisable for the first
time during any calendar year (under the Plan and all other plans
of the Grantee’s employer and its Affiliates) does not exceed
$100,000. This limitation shall be applied by taking Options into
account in the order in which they were granted.
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9.
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TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS
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9.1
Right to Payment.
A SAR shall confer on the Grantee a right to
receive, upon exercise thereof, the excess of (i) the Fair Market
Value of one share of Stock on the date of exercise over (ii) the
SAR Exercise Price, as determined by the Board. The Award Agreement
for a SAR (except those that constitute Substitute Awards) shall
specify the SAR Exercise Price, which shall be fixed on the Grant
Date as not less than the Fair Market Value of a share of Stock on
that date. SARs may be granted alone or in conjunction with
all or part of an Option or at any subsequent time during the term
of such Option or in conjunction with all or part of any other
Award. A SAR granted in tandem with an outstanding Option following
the Grant Date of such Option shall have a grant price that is
equal to the Option Price;provided, however, that the SAR’s grant price may not be less
than the Fair Market Value of a share of Stock on the Grant Date of
the SAR to the extent required by Section 409A.
9.2
Other Terms.
The
Board shall determine at the Grant Date, the time or times at which
and the circumstances under which a SAR may be exercised in whole
or in part (including based on achievement of performance goals
and/or future service requirements), the time or times at which
SARs shall cease to be or become exercisable following Separation
from Service or upon other conditions, the method of exercise,
whether or not a SAR shall be in tandem or in combination with any
other Award, and any other terms and conditions of any
SAR.
9.3 Term
of SARs.
The term of a SAR granted under the Plan shall be
determined by the Board, in its sole discretion;provided, however, that such term shall not exceed ten
(10) years.
9.4
Payment of SAR Amount.
Upon
exercise of a SAR, a Grantee shall be entitled to receive payment
from the Company (in cash or Stock, as determined by the Board) in
an amount determined by multiplying:
(i)
the difference between the Fair Market Value of a
share of Stock on the date of exercise over the SAR Exercise Price;
by
(ii)
the number of shares of Stock with respect to which the SAR is
exercised.
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10.
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TERMS AND CONDITIONS OF RESTRICTED STOCK AND RESTRICTED STOCK
UNITS
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10.1
Restrictions.
At
the time of grant, the Board may, in its sole discretion, establish
a period of time (a “Restricted Period”) and any
additional restrictions including the satisfaction of corporate or
individual performance objectives applicable to an Award of
Restricted Stock or Restricted Stock Units as determined by the
Board. Each Award of Restricted Stock or Restricted Stock Units may
be subject to a different Restricted Period and additional
restrictions. Neither Restricted Stock nor Restricted Stock Units
may be sold, transferred, assigned, pledged or otherwise encumbered
or disposed of during the Restricted Period or prior to the
satisfaction of any other applicable restrictions.
10.2
Restricted Stock Certificates.
The Company shall issue stock, in the name of each
Grantee to whom Restricted Stock has been granted, stock
certificates or other evidence of ownership representing the total
number of shares of Restricted Stock granted to the Grantee, as
soon as reasonably practicable after the Grant Date. The Board may
provide in an Award Agreement that either (i) the Secretary of the
Company shall hold such certificates for the Grantee’s
benefit until such time as the Restricted Stock is forfeited to the
Company or the restrictions lapse, or (ii) such certificates shall
be delivered to the Grantee;provided, however, that such certificates shall bear a legend or
legends that comply with the applicable securities laws and
regulations and make appropriate reference to the restrictions
imposed under the Plan and the Award Agreement.
10.3
Rights of Holders of Restricted Stock.
Unless
the Board otherwise provides in an Award Agreement and subject
to Section 16.12, holders of Restricted Stock shall have
rights as stockholders of the Company, including voting and
dividend rights.
10.4
Rights of Holders of Restricted Stock Units.
10.4.1
Settlement of Restricted Stock Units.
Restricted
Stock Units may be settled in cash or Stock, as determined by the
Board and set forth in the Award Agreement. The Award Agreement
shall also set forth whether the Restricted Stock Units shall be
settled (i) within the time period specified for “short term
deferrals” under Section 409A or (ii) otherwise within the
requirements of Section 409A, in which case the Award Agreement
shall specify upon which events such Restricted Stock Units shall
be settled.
10.4.2
Voting and Dividend Rights.
Unless
otherwise stated in the applicable Award Agreement and subject to
Section 16.12, holders of Restricted Stock Units shall not have
rights as stockholders of the Company, including no voting or
dividend or dividend equivalents rights.
10.4.3
Creditor’s Rights.
A
holder of Restricted Stock Units shall have no rights other than
those of a general creditor of the Company. Restricted Stock Units
represent an unfunded and unsecured obligation of the Company,
subject to the terms and conditions of the applicable Award
Agreement.
10.5
Purchase of Restricted Stock.
The
Grantee shall be required, to the extent required by applicable
law, to purchase the Restricted Stock from the Company at a
Purchase Price equal to the greater of (i) the aggregate par value
of the shares of Stock represented by such Restricted Stock or (ii)
the Purchase Price, if any, specified in the related Award
Agreement. If specified in the Award Agreement, the Purchase Price
may be deemed paid by Services already rendered. The Purchase Price
shall be payable in a form described in Section 11 or, in the
discretion of the Board, in consideration for past Services
rendered.
10.6
Delivery of Stock.
Upon
the expiration or termination of any Restricted Period and the
satisfaction of any other conditions prescribed by the Board, the
restrictions applicable to shares of Restricted Stock or Restricted
Stock Units settled in Stock shall lapse, and, unless otherwise
provided in the Award Agreement, a stock certificate for such
shares shall be delivered, free of all such restrictions, to the
Grantee or the Grantee’s beneficiary or estate, as the case
may be.
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11.
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FORM OF PAYMENT FOR OPTIONS AND RESTRICTED STOCK
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11.1
General Rule.
Payment
of the Option Price for the shares purchased pursuant to the
exercise of an Option or the Purchase Price for Restricted Stock
shall be made in cash or in cash equivalents acceptable to the
Company, except as provided in this Section 11.
11.2
Surrender of Stock.
To
the extent the Award Agreement so provides, payment of the Option
Price for shares purchased pursuant to the exercise of an Option or
the Purchase Price for Restricted Stock may be made all or in part
through the tender to the Company of shares of Stock, which shares
shall be valued, for purposes of determining the extent to which
the Option Price or Purchase Price for Restricted Stock has been
paid thereby, at their Fair Market Value on the date of exercise or
surrender. Notwithstanding the foregoing, in the case of an
Incentive Stock Option, the right to make payment in the form of
already owned shares of Stock may be authorized only at the time of
grant.
11.3
Cashless Exercise.
With
respect to an Option only (and not with respect to Restricted
Stock), to the extent permitted by law and to the extent the Award
Agreement so provides, payment of the Option Price may be made all
or in part by delivery (on a form acceptable to the Company) of an
irrevocable direction to a licensed securities broker acceptable to
the Company to sell shares of Stock and to deliver all or part of
the sales proceeds to the Company in payment of the Option Price
and any withholding taxes described in Section
16.3.
11.4
Other Forms of Payment.
To
the extent the Award Agreement so provides, payment of the Option
Price or the Purchase Price for Restricted Stock may be made in any
other form that is consistent with applicable laws, regulations and
rules, including, but not limited to, the Company’s
withholding
of shares of Stock otherwise due to the exercising
Grantee.
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12.
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OTHER STOCK-BASED AWARDS
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12.1
Grant of Other Stock-based Awards.
Other
Stock-based Awards may be granted either alone or in addition to or
in conjunction with other Awards under the Plan. Other
Stock-based Awards may be granted in lieu of other cash or other
compensation to which a Service Provider is entitled from the
Company or may be used in the settlement of amounts payable in
shares of Common Stock under any other compensation plan or
arrangement of the Company. Subject to the provisions of the
Plan, the Committee shall have the sole and complete authority to
determine the persons to whom and the time or times at which such
Awards shall be made, the number of shares of Common Stock to be
granted pursuant to such Awards, and all other conditions of such
Awards. Unless the Committee determines otherwise, any such
Award shall be confirmed by an Award Agreement, which shall contain
such provisions as the Committee determines to be necessary or
appropriate to carry out the intent of this Plan with respect to
such Award.
12.2
Terms of Other Stock-based Awards.
Any
Common Stock subject to Awards made under this Section 12 may not
be sold, assigned, transferred, pledged or otherwise encumbered
prior to the date on which the shares are issued, or, if later, the
date on which any applicable restriction, performance or deferral
period lapses.
13.1
General.
The
Company shall not be required to sell or issue any shares of Stock
under any Award if the sale or issuance of such shares would
constitute a violation by the Grantee, any other individual
exercising an Option, or the Company of any provision of any law or
regulation of any governmental authority, including without
limitation any federal or state securities laws or regulations. If
at any time the Company shall determine, in its discretion, that
the listing, registration or qualification of any shares subject to
an Award upon any securities exchange or under any governmental
regulatory body is necessary or desirable as a condition of, or in
connection with, the issuance or purchase of shares hereunder, no
shares of Stock may be issued or sold to the Grantee or any other
individual exercising an Option pursuant to such Award unless such
listing, registration, qualification, consent or approval shall
have been effected or obtained free of any conditions not
acceptable to the Company, and any delay caused thereby shall in no
way affect the date of termination of the Award. Specifically, in
connection with the Securities Act, upon the exercise of any Option
or the delivery of any shares of Stock underlying an Award, unless
a registration statement under such Act is in effect with respect
to the shares of Stock covered by such Award, the Company shall not
be required to sell or issue such shares unless the Board has
received evidence satisfactory to it that the Grantee or any other
individual exercising an Option may acquire such shares pursuant to
an exemption from registration under the Securities Act. Any
determination in this connection by the Board shall be final,
binding, and conclusive. The Company may, but shall in no event be
obligated to, register any securities covered hereby pursuant to
the Securities Act. The Company shall not be obligated to take any
affirmative action in order to cause the exercise of an Option or
the issuance of shares of Stock pursuant to the Plan to comply with
any law or regulation of any governmental authority. As to any
jurisdiction that expressly imposes the requirement that an Option
shall not be exercisable until the shares of Stock covered by such
Option are registered or are exempt from registration, the exercise
of such Option (under circumstances in which the laws of such
jurisdiction apply) shall be deemed conditioned upon the
effectiveness of such registration or the availability of such an
exemption.
13.2
Rule 16b-3.
During
any time when the Company has a class of equity security registered
under Section 12 of the Exchange Act, it is the intent of the
Company that Awards and the exercise of Options granted to officers
and directors hereunder will qualify for the exemption provided by
Rule 16b-3 under the Exchange Act. To the extent that any provision
of the Plan or action by the Board or Committee does not comply
with the requirements of Rule 16b-3, it shall be deemed inoperative
to the extent permitted by law and deemed advisable by the Board,
and shall not affect the validity of the Plan. In the event that
Rule 16b-3 is revised or replaced, the Board may exercise its
discretion to modify this Plan in any respect necessary to satisfy
the requirements of, or to take advantage of any features of, the
revised exemption or its replacement.
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14.
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EFFECT OF CHANGES IN CAPITALIZATION
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14.1
Changes in Stock.
If
(i) the number of outstanding shares of Stock is increased or
decreased or the shares of Stock are changed into or exchanged for
a different number or kind of shares or other securities of the
Company on account of any recapitalization, reclassification, stock
split, reverse split, combination of shares, exchange of shares,
stock dividend or other distribution payable in capital stock, or
other increase or decrease in such shares effected without receipt
of consideration by the Company occurring after the Effective Date
or (ii) there occurs any spin-off, split-up, extraordinary cash
dividend or other distribution of assets by the Company, the number
and kinds of shares for which grants of Awards may be made under
the Plan (including the per-Grantee maximums set forth in Section
4) shall be equitably adjusted by the Company; provided that any
such adjustment shall comply with Section 409A. In addition, in the
event of any such increase or decease in the number of outstanding
shares or other transaction described in clause (ii) above, the
number and kind of shares for which Awards are outstanding and the
Option Price per share of outstanding Options and SAR Exercise
Price per share of outstanding SARs shall be equitably adjusted;
provided that any such adjustment shall comply with Section
409A.
14.2
Effect of Certain Transactions.
Except as otherwise provided in an Award Agreement
and subject to the provisions of Section 14.3, in the event of a
Corporate Transaction, the Plan and the Awards issued hereunder
shall continue in effect in accordance with their respective terms,
except that following a Corporate Transaction either (i) each
outstanding Award shall be treated as provided for in the agreement
entered into in connection with the Corporate Transaction or (ii)
if not so provided in such agreement, each Grantee shall be
entitled to receive in respect of each share of Common Stock
subject to any outstanding Awards, upon exercise or payment or
transfer in respect of any Award, the same number and kind of
stock, securities, cash, property or other consideration that each
holder of a share of Common Stock was entitled to receive in the
Corporate Transaction in respect of a share of Common
stock;provided, however, that, unless otherwise determined by the
Committee, such stock, securities, cash, property or other
consideration shall remain subject to all of the conditions,
restrictions and performance criteria which were applicable to the
Awards prior to such Corporate Transaction. Without limiting
the generality of the foregoing, the treatment of outstanding
Options and SARs pursuant to this Section 14.2 in connection with a
Corporate Transaction in which the consideration paid or
distributed to the Company’s stockholders is not entirely
shares of common stock of the acquiring or resulting corporation
may include the cancellation of outstanding Options and SARs upon
consummation of the Corporate Transaction as long as, at the
election of the Committee, (i) the holders of affected Options and
SARs have been given a period of at least fifteen days prior to the
date of the consummation of the Corporate Transaction to exercise
the Options or SARs (to the extent otherwise exercisable) or (ii)
the holders of the affected Options and SARs are paid (in cash or
cash equivalents) in respect of each Share covered by the Option or
SAR being canceled an amount equal to the excess, if any, of the
per share price paid or distributed to stockholders in the
Corporate Transaction (the value of any non-cash consideration to
be determined by the Committee in its sole discretion) over the
Option Price or SAR Exercise Price, as applicable. For
avoidance of doubt, (1) the cancellation of Options and SARs
pursuant to clause (ii) of the preceding sentence may be effected
notwithstanding anything to the contrary contained in this Plan or
any Award Agreement and (2) if the amount determined pursuant to
clause (ii) of the preceding sentence is zero or less, the affected
Option or SAR may be cancelled without any payment therefore.
The treatment of any Award as provided in this Section 14.2 shall
be conclusively presumed to be appropriate for purposes of Section
14.1.
14.3
Change in Control
14.3.1
Consequences of a Change in Control
In
the event of a Change in Control of the Company, the Board, in its
discretion, may, at any time an Award is granted, or at any time
thereafter, (i) accelerate the time period relating to the exercise
or vesting of the Award; or (ii) take one or more of the following
actions, which may vary among individual Grantees: (A) provide for
the purchase of the Award for an amount of cash or other property
that could have been received upon the exercise or vesting of the
Award (less any applicable Option Price or SAR Exercise Price in
the cash of Options and SARs); (B) adjust the terms of the Awards
in a manner determined by the Board to reflect the Change in
Control; (C) cause the Awards to be assumed, or new rights
substituted therefor, by another entity, through the continuance of
the Plan and the assumption of outstanding Awards, or the
substitution for such Awards of comparable value covering shares of
a successor corporation, with appropriate adjustments as to the
number and kind of shares and exercise prices, in which event the
Plan and such Awards, or the new options and rights substituted
therefor, shall continue in the manner and under the terms so
provided; (D) accelerate the time at which Options or SARs then
outstanding may be exercised so that such Options and SARs may be
exercised for a limited period of time on or before a specified
date fixed by the Board, after which specified date, all
unexercised Options and SARs shall terminate; or (E) make such
other provision as the Board may consider equitable.
14.3.2
Change in Control Defined
Except as may otherwise be defined in an Award
Agreement, a “Change in
Control” shall mean the
occurrence of any of the following events: (i) the acquisition,
directly or indirectly, by any Person or group (within the meaning
of Section 13(d)(3) of the Exchange Act) of the Beneficial
Ownership of more than fifty percent of the outstanding securities
of the Company; (ii) a merger or consolidation in which the Company
is not the surviving entity, except for a transaction the principal
purpose of which is to change the state in which the Company is
incorporated; (iii) the sale, transfer or other disposition of all
or substantially all of the assets of the Company; (i) a complete
liquidation or dissolution of the Company; or (v) any reverse
merger in which the Company is the surviving entity but in which
securities possessing more than fifty percent of the total combined
voting power of the Company’s outstanding securities are
transferred to a Person or Persons different from the Persons
holding those securities immediately prior to such
merger.
Notwithstanding
the foregoing, if it is determined that an Award hereunder is
subject to the requirements of Section 409A and payable upon a
Change in Control, the Company will not be deemed to have undergone
a Change in Control unless the Company is deemed to have undergone
a “change in control event” pursuant to the definition
of such term in Section 409A.
14.4
Adjustments
Adjustments
under this Section 14 related to shares of Stock or securities of
the Company shall be made by the Board, whose determination in that
respect shall be final, binding and conclusive. No fractional
shares or other securities shall be issued pursuant to any such
adjustment, and any fractions resulting from any such adjustment
shall be eliminated in each case by rounding downward to the
nearest whole share.
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15.
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NO LIMITATIONS ON COMPANY
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The
making of Awards pursuant to the Plan shall not affect or limit in
any way the right or power of the Company to make adjustments,
reclassifications, reorganizations, or changes of its capital or
business structure or to merge, consolidate, dissolve, or
liquidate, or to sell or transfer all or any part of its business
or assets.
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16.
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TERMS APPLICABLE GENERALLY TO AWARDS GRANTED UNDER THE
PLAN
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16.1
Disclaimer of Rights.
No
provision in the Plan or in any Award Agreement shall be construed
to confer upon any individual the right to remain in the employ or
service of the Company or any Affiliate, or to interfere in any way
with any contractual or other right or authority of the Company
either to increase or decrease the compensation or other payments
to any individual at any time, or to terminate any employment or
other relationship between any individual and the Company. In
addition, notwithstanding anything contained in the Plan to the
contrary, unless otherwise stated in the applicable Award
Agreement, no Award granted under the Plan shall be affected by any
change of duties or position of the Grantee, so long as such
Grantee continues to be a Service Provider. The obligation of the
Company to pay any benefits pursuant to this Plan shall be
interpreted as a contractual obligation to pay only those amounts
described herein, in the manner and under the conditions prescribed
herein. The Plan shall in no way be interpreted to require the
Company to transfer any amounts to a third party trustee or
otherwise hold any amounts in trust or escrow for payment to any
Grantee or beneficiary under the terms of the Plan.
16.2
Nonexclusivity of the Plan.
Neither
the adoption of the Plan nor the submission of the Plan to the
stockholders of the Company for approval shall be construed as
creating any limitations upon the right and authority of the Board
to adopt such other incentive compensation arrangements (which
arrangements may be applicable either generally to a class or
classes of individuals or specifically to a particular individual
or particular individuals), including, without limitation, the
granting of stock options as the Board in its discretion determines
desirable.
16.3
Withholding Taxes.
The
Company or an Affiliate, as the case may be, shall have the right
to deduct from payments of any kind otherwise due to a Grantee any
federal, state, or local taxes of any kind required by law to be
withheld (i) with respect to the vesting of or other lapse of
restrictions applicable to an Award, (ii) upon the issuance of any
shares of Stock upon the exercise of an Option or SAR, or (iii)
otherwise due in connection with an Award. At the time of
such vesting, lapse, or exercise, the Grantee shall pay to the
Company or the Affiliate, as the case may be, any amount that the
Company or the Affiliate may reasonably determine to be necessary
to satisfy such withholding obligation. Subject to the prior
approval of the Company or the Affiliate, which may be withheld by
the Company or the Affiliate, as the case may be, in its sole
discretion, the Grantee may elect to satisfy such obligations, or
the Company may require such obligations (up to maximum statutory
rates) to be satisfied, in whole or in part, (i) by causing the
Company or the Affiliate to withhold the number of shares of Stock
otherwise issuable to the Grantee as may be necessary to satisfy
such withholding obligation or (ii) by delivering to the Company or
the Affiliate shares of Stock already owned by the Grantee. The
shares of Stock so delivered or withheld shall have an aggregate
Fair Market Value equal to such withholding obligations (up to
maximum statutory rates). The Fair Market Value of the shares
of Stock used to satisfy such withholding obligation shall be
determined by the Company or the Affiliate as of the date that the
amount of tax to be withheld is to be determined. A Grantee who has
made an election pursuant to this Section 16.3 may satisfy his or
her withholding obligation only with shares of Stock that are not
subject to any repurchase, forfeiture, unfulfilled vesting, or
other similar requirements.
16.4
Captions.
The
use of captions in this Plan or any Award Agreement is for the
convenience of reference only and shall not affect the meaning of
any provision of the Plan or any Award Agreement.
16.5
Other Provisions.
Each
Award Agreement may contain such other terms and conditions not
inconsistent with the Plan as may be determined by the Board, in
its sole discretion. In the event of any conflict between the
terms of an employment agreement and the Plan, the terms of the
employment agreement govern.
16.6
Number and Gender.
With
respect to words used in this Plan, the singular form shall include
the plural form, the masculine gender shall include the feminine
gender, etc., as the context requires.
16.7
Severability.
If
any provision of the Plan or any Award Agreement shall be
determined to be illegal or unenforceable by any court of law in
any jurisdiction, the remaining provisions hereof and thereof shall
be severable and enforceable in accordance with their terms, and
all provisions shall remain enforceable in any other
jurisdiction.
16.8
Governing Law.
The
Plan shall be governed by and construed in accordance with the laws
of the State of Nevada without giving effect to the principles of
conflicts of law, and applicable Federal law.
16.9
Section 409A.
The
Plan is intended to comply with Section 409A to the extent subject
thereto, and, accordingly, to the maximum extent permitted, the
Plan shall be interpreted and administered to be in compliance
therewith. Any payments described in the Plan that are due within
the “short-term deferral period” as defined in Section
409A shall not be treated as deferred compensation unless
applicable laws require otherwise. Notwithstanding anything to the
contrary in the Plan, to the extent required to avoid accelerated
taxation and tax penalties under Section 409A, amounts that would
otherwise be payable and benefits that would otherwise be provided
pursuant to the Plan during the six (6) month period immediately
following the Grantee’s Separation from Service shall instead
be paid on the first payroll date after the six-month anniversary
of the Grantee’s Separation from Service (or the
Grantee’s death, if earlier). Notwithstanding the foregoing,
neither the Company nor the Committee shall have any obligation to
take any action to prevent the assessment of any excise tax or
penalty on any Grantee under Section 409A and neither the Company
nor the Committee will have any liability to any Grantee for such
tax or penalty.
16.10
Separation from Service.
The
Board shall determine the effect of a Separation from Service upon
Awards, and such effect shall be set forth in the appropriate Award
Agreement. Without limiting the foregoing, the Board may
provide in the Award Agreements at the time of grant, or any time
thereafter with the consent of the Grantee, the actions that will
be taken upon the occurrence of a Separation from Service,
including, but not limited to, accelerated vesting or termination,
depending upon the circumstances surrounding the Separation from
Service.
16.11
Transferability of Awards.
16.11.1
Transfers in General.
Except
as provided in Section 16.11.2, no Award shall be assignable or
transferable by the Grantee to whom it is granted, other than by
will or the laws of descent and distribution, and, during the
lifetime of the Grantee, only the Grantee personally (or the
Grantee’s personal representative) may exercise rights under
the Plan.
16.11.2 Family
Transfers.
If
authorized in the applicable Award Agreement, a Grantee may
transfer, not for value, all or part of an Award (other than
Incentive Stock Options) to any Family Member. For the
purpose of this Section 16.11.2, a “not for value”
transfer is a transfer which is (i) a gift, (ii) a transfer under a
domestic relations order in settlement of marital property rights;
or (iii) a transfer to an entity in which more than fifty percent
of the voting interests are owned by Family Members (or the
Grantee) in exchange for an interest in that entity.
Following a transfer under this Section 16.11.2, any such Award
shall continue to be subject to the same terms and conditions as
were applicable immediately prior to transfer. Subsequent transfers
of transferred Awards are prohibited except to Family Members of
the original Grantee in accordance with this Section 16.11.2 or by
will or the laws of descent and distribution.
16.12
Dividends and Dividend Equivalent Rights.
If
specified in the Award Agreement, the recipient of an Award (other
than Options or SARs) may be entitled to receive dividends or
dividend equivalents with respect to the Common Stock or other
securities covered by an Award. The terms and conditions of a
dividend equivalent right may be set forth in the Award
Agreement. Dividend equivalents credited to a Grantee may be
reinvested in additional shares of Stock or other securities of the
Company at a price per unit equal to the Fair Market Value of a
share of Stock on the date that such dividend was paid to
stockholders, as determined in the sole discretion of the
Committee. Notwithstanding any provision herein to the
contrary, in no event will dividends or dividend equivalents vest
or otherwise be paid out prior to the time that the underlying
Award (or portion thereof) has vested and, accordingly, will be
subject to cancellation and forfeiture if such Award does not vest
(including both time-based and performance-based
Awards).
The Plan was adopted by the Board of Directors on March 19,
2020.
IMAGEWARE SYSTEMS, INC.
WRITTEN CONSENT SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF IMAGEWARE SYSTEMS, INC.
The
undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Consent Solicitation and the Consent
Solicitation Statement of ImageWare Systems, Inc. (the
“Company”)
dated April [●], 2020 and hereby revokes any consent or
consents heretofore given. This consent may be revoked at any time
before 5:00 P.M., Pacific Time, on [●], unless the
solicitation period is shortened or extended by the Company in its
sole discretion (“Expiration
Date”). The undersigned, as holder of shares of the
Company’s common stock, par value $0.01 per share, CUSIP No.
45245S108 (“Common
Stock”), hereby takes the following action with
respect to all shares of Common Stock held by him, her or it as
follows:
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[X] Please mark your votes as indicated in this
example.
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FOR
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AGAINST
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ABSTAIN
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APPROVAL
OF AN AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION
TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE COMPANY’S
COMMON STOCK, $0.01 PAR VALUE PER SHARE, FROM 179,000,000 TO
254,000,000 AND TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE
COMPANY’S PREFERRED STOCK, $0.01 PAR VALUE PER SHARE, FROM
4,000,000 TO 5,000,000.
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[ ]
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[ ]
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[ ]
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APPROVAL
OF THE COMPANY’S 2020 OMNIBUS EQUITY INCENTIVE
PLAN.
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[ ]
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[ ]
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[ ]
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This Written Consent, when properly executed and returned to the
Company, will be voted in the manner directed herein by the
undersigned. IF NO DIRECTION IS MADE FOR THE PROPOSALS, THIS
CONSENT, IF SO EXECUTED AND RETURNED, WILL BE VOTED FOR EACH
PROPOSAL. When shares of Common Stock are held by joint tenants,
both should sign. When signing as attorney, executor,
administrator, trustee or guardian, give full legal title as such.
If a corporation, sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership
name by authorized person.
ALL CONSENTS MUST BE RECEIVED BY 5:00 P.M., PACIFIC TIME, ON THE
EXPIRATION DATE.
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IMPORTANT: This Consent Card must be signed exactly as
your name appears hereon. If more than one name appears, all
persons so designated should sign. Attorneys, executors,
administrators, trustees and guardians should indicate their
capacities. If the signer is a corporation, please print full
corporate name and indicate capacity of duly authorized officer
executing on behalf of the corporation. If the signer is a
partnership, please print full partnership name and indicate
capacity of duly authorized person executing on behalf of the
partnership.
Dated:
________________________, ______
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(Print
Name of Stockholder)
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(Signature
of Stockholder)
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(Second
Signature if held jointly)
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IMPORTANT: PLEASE COMPLETE, SIGN, AND DATE YOUR WRITTEN CONSENT
PROMPTLY
AND FAX IT TO (858) 673-1770, OR RETURN IT IN THE ENVELOPE PROVIDED
TO:
ImageWare Systems, Inc.
Attn: Wayne Wetherell, Corporate Secretary
13500 Evening Creek Drive N, Suite 550
San Diego, California 92128
Your executed written consent can also be sent via email in PDF
form to wgw@iwsinc.com.
Your Written Consent should be received by the Company on or before
[●].
IMAGEWARE SYSTEMS, INC.
WRITTEN CONSENT SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF IMAGEWARE SYSTEMS, INC.
The
undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Consent Solicitation Statement and the
Consent Solicitation Statement of ImageWare Systems, Inc. (the
“Company”)
dated April [●], 2020 and hereby revokes any consent or
consents heretofore given. This consent may be revoked at any time
before 5:00 P.M., Pacific Time, on [●], unless the
solicitation period is shortened or extended by the Company in its
sole discretion (“Expiration
Date”). The undersigned, as holder of shares of the
Company’s Series A Preferred Stock (“Series A Preferred”), hereby
takes the following action with respect to all shares of Series A
Preferred held by him, her or it as follows:
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[X] Please mark your votes as indicated in this
example.
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FOR
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AGAINST
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ABSTAIN
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|
|
APPROVAL
OF AN AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION
TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE COMPANY’S
COMMON STOCK, $0.01 PAR VALUE PER SHARE, FROM 179,000,000 TO
254,000,000 AND TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE
COMPANY’S PREFERRED STOCK, $0.01 PAR VALUE PER SHARE, FROM
4,000,000 TO 5,000,000.
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[ ]
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[ ]
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[ ]
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APPROVAL
OF THE COMPANY’S 2020 OMNIBUS EQUITY INCENTIVE
PLAN.
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[ ]
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[ ]
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[ ]
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This Written Consent, when properly executed and returned to the
Company, will be voted in the manner directed herein by the
undersigned. IF NO DIRECTION IS MADE FOR THE PROPOSALS, THIS
CONSENT, IF SO EXECUTED AND RETURNED, WILL BE VOTED FOR EACH
PROPOSAL. When shares of Common Stock are held by joint tenants,
both should sign. When signing as attorney, executor,
administrator, trustee or guardian, give full legal title as such.
If a corporation, sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership
name by authorized person.
ALL CONSENTS MUST BE RECEIVED BY 5:00 P.M., PACIFIC TIME, ON THE
EXPIRATION DATE.
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IMPORTANT: This Consent Card must be signed exactly as
your name appears hereon. If more than one name appears, all
persons so designated should sign. Attorneys, executors,
administrators, trustees and guardians should indicate their
capacities. If the signer is a corporation, please print full
corporate name and indicate capacity of duly authorized officer
executing on behalf of the corporation. If the signer is a
partnership, please print full partnership name and indicate
capacity of duly authorized person executing on behalf of the
partnership.
Dated:
________________________, ______
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(Print
Name of Stockholder)
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|
|
(Signature
of Stockholder)
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|
|
(Second
Signature if held jointly)
|
IMPORTANT: PLEASE COMPLETE, SIGN, AND DATE YOUR WRITTEN CONSENT
PROMPTLY
AND FAX IT TO (858) 673-1770, OR RETURN IT IN THE ENVELOPE PROVIDED
TO:
ImageWare
Systems, Inc.
Attn:
Wayne Wetherell, Corporate Secretary
13500
Evening Creek Drive N, Suite 550
San
Diego, California 92128
Your
executed written consent can also be sent via email in PDF form to
wgw@iwsinc.com.
Your Written Consent should be received by the Company on or before
[●].
IMAGEWARE SYSTEMS, INC.
WRITTEN CONSENT SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF IMAGEWARE SYSTEMS, INC.
The
undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Consent Solicitation Statement and the
Consent Solicitation Statement of ImageWare Systems, Inc. (the
“Company”)
dated April [●], 2020 and hereby revokes any consent or
consents heretofore given. This consent may be revoked at any time
before 5:00 P.M., Pacific Time, on [●], unless the
solicitation period is shortened or extended by the Company in its
sole discretion (“Expiration
Date”). The undersigned, as holder of shares of the
Company’s Series B Convertible Redeemable Preferred Stock
(“Series B
Preferred”), hereby takes the following action with
respect to all shares of Series B Preferred held by him, her or it
as follows:
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[X] Please mark your votes as indicated in this
example.
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FOR
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AGAINST
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ABSTAIN
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|
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APPROVAL
OF AN AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION
TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE COMPANY’S
COMMON STOCK, $0.01 PAR VALUE PER SHARE, FROM 179,000,000 TO
254,000,000 AND TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE
COMPANY’S PREFERRED STOCK, $0.01 PAR VALUE PER SHARE, FROM
4,000,000 TO 5,000,000.
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[ ]
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[ ]
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[ ]
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|
|
APPROVAL
OF THE COMPANY’S 2020 OMNIBUS EQUITY INCENTIVE
PLAN.
|
|
[ ]
|
|
[ ]
|
|
[ ]
|
|
|
This Written Consent, when properly executed and returned to the
Company, will be voted in the manner directed herein by the
undersigned. IF NO DIRECTION IS MADE FOR THE PROPOSALS, THIS
CONSENT, IF SO EXECUTED AND RETURNED, WILL BE VOTED FOR EACH
PROPOSAL. When shares of Common Stock are held by joint tenants,
both should sign. When signing as attorney, executor,
administrator, trustee or guardian, give full legal title as such.
If a corporation, sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership
name by authorized person.
ALL CONSENTS MUST BE RECEIVED BY 5:00 P.M., PACIFIC TIME, ON THE
EXPIRATION DATE.
|
|
IMPORTANT: This Consent Card must be signed exactly as
your name appears hereon. If more than one name appears, all
persons so designated should sign. Attorneys, executors,
administrators, trustees and guardians should indicate their
capacities. If the signer is a corporation, please print full
corporate name and indicate capacity of duly authorized officer
executing on behalf of the corporation. If the signer is a
partnership, please print full partnership name and indicate
capacity of duly authorized person executing on behalf of the
partnership.
Dated:
________________________, ______
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|
|
|
(Print
Name of Stockholder)
|
|
|
|
(Signature
of Stockholder)
|
|
|
|
(Second
Signature if held jointly)
|
IMPORTANT: PLEASE COMPLETE, SIGN, AND DATE YOUR WRITTEN CONSENT
PROMPTLY
AND FAX IT TO (858) 673-1770, OR RETURN IT IN THE ENVELOPE PROVIDED
TO:
ImageWare
Systems, Inc.
Attn:
Wayne Wetherell, Corporate Secretary
13500
Evening Creek Drive N, Suite 550
San
Diego, California 92128
Your
executed written consent can also be sent via email in PDF form to
wgw@iwsinc.com.
Your Written Consent should be received by the Company on or before
[●].
IMAGEWARE SYSTEMS, INC.
WRITTEN CONSENT SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF IMAGEWARE SYSTEMS, INC.
The
undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Consent Solicitation Statement and the
Consent Solicitation Statement of ImageWare Systems, Inc. (the
“Company”)
dated April [●], 2020 and hereby revokes any consent or
consents heretofore given. This consent may be revoked at any time
before 5:00 P.M., Pacific Time, on [●], unless the
solicitation period is shortened or extended by the Company in its
sole discretion (“Expiration
Date”). The undersigned, as holder of shares of the
Company’s Series C Convertible Preferred Stock
(“Series C
Preferred”), hereby takes the following action with
respect to all shares of Series C Preferred held by him, her or it
as follows:
|
|
[X] Please mark your votes as indicated in this
example.
|
|
|
|
|
|
|
|
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|
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FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
APPROVAL
OF AN AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION
TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE COMPANY’S
COMMON STOCK, $0.01 PAR VALUE PER SHARE, FROM 179,000,000 TO
254,000,000 AND TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF THE
COMPANY’S PREFERRED STOCK, $0.01 PAR VALUE PER SHARE, FROM
4,000,000 TO 5,000,000.
|
|
[ ]
|
|
[ ]
|
|
[ ]
|
|
|
|
|
|
|
|
|
|
|
|
|
|
APPROVAL
OF THE COMPANY’S 2020 OMNIBUS EQUITY INCENTIVE
PLAN.
|
|
[ ]
|
|
[ ]
|
|
[ ]
|
|
|
This Written Consent, when properly executed and returned to the
Company, will be voted in the manner directed herein by the
undersigned. IF NO DIRECTION IS MADE FOR THE PROPOSALS, THIS
CONSENT, IF SO EXECUTED AND RETURNED, WILL BE VOTED FOR EACH
PROPOSAL. When shares of Common Stock are held by joint tenants,
both should sign. When signing as attorney, executor,
administrator, trustee or guardian, give full legal title as such.
If a corporation, sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership
name by authorized person.
ALL CONSENTS MUST BE RECEIVED BY 5:00 P.M., PACIFIC TIME, ON THE
EXPIRATION DATE.
|
|
IMPORTANT: This Consent Card must be signed exactly as
your name appears hereon. If more than one name appears, all
persons so designated should sign. Attorneys, executors,
administrators, trustees and guardians should indicate their
capacities. If the signer is a corporation, please print full
corporate name and indicate capacity of duly authorized officer
executing on behalf of the corporation. If the signer is a
partnership, please print full partnership name and indicate
capacity of duly authorized person executing on behalf of the
partnership.
Dated:
________________________, ______
|
|
|
|
|
(Print
Name of Stockholder)
|
|
|
|
(Signature
of Stockholder)
|
|
|
|
(Second
Signature if held jointly)
|
IMPORTANT: PLEASE COMPLETE, SIGN, AND DATE YOUR WRITTEN CONSENT
PROMPTLY
AND FAX IT TO (858) 673-1770, OR RETURN IT IN THE ENVELOPE PROVIDED
TO:
ImageWare
Systems, Inc.
Attn:
Wayne Wetherell, Corporate Secretary
13500
Evening Creek Drive N, Suite 550
San
Diego, California 92128
Your
executed written consent can also be sent via email in PDF form to
wgw@iwsinc.com.
Your Written Consent should be received by the Company on or before
[●].