________________________________________________________________________________
DATASCENSION, INC.
EMPLOYMENT AGREEMENT WITH XXXXX X. XXXXXX
________________________________________________________________________________
Page 1 of 63
TABLE OF CONTENTS
1. Employment
2. Performance of Duties
3. Compensation
(a) Base Salary
(b) Initial Restricted Stock Award
(c) Initial Option Award
(d) Subsequent Restricted Stock Option Award
(f) Employee Benefits, Fringe Benefits and Perquisites
(g) Change In Control
(h) Expense Reimbursement
(i) Stock Splits
(j) Spin Offs
(k) Stock Award and Options Datascension International, Inc
4. Indemnification
5. Termination of Employment
(a) Death
(b) Termination for Cause or Voluntary Resignation
(c) Termination Without Cause
(d) Constructive Discharge
(e) Termination Due to Employment Order
(f) Non-renewal of Agreement by the Company
(g) No Mitigation; No Offset
(h) Nature of Payments
(i) Effect of Termination on Other Positions
(j) Benefit Plans
(k) Other Severance Arrangements
(l) Return of Company Property
(m) Adverse Actions
(n) Mutual Nondisparagement
(o) Loans to Company
(p) Personal Guarantees
6. Confidential Information
7. Nonsolicitation
8. Noncompetition
9. Equitable Remedies
10. Assistance with Claims
11. Assignability, Binding Nature
12. Amendment
13. Applicable Law
14. Severability
15. Waiver of Breach
16. Compliance with Law
17. Notices
18. Executive's Representations
19. Company's Representations
20. Survivorship
21. Entire Agreement
22. Counterparts
EXHIBIT A
STOCK COMPENSATION PLAN
I. GENERAL PROVISIONS
1.01 PURPOSE
1.02 PARTICIPANTS
1.03 DEFINITIONS
1.04 ADMINISTRATION
1.05 STOCK
II. STOCK OPTIONS
2.01 GRANT OF OPTIONS
2.02 INCENTIVE STOCK OPTIONS
2.03 OPTION PRICE
2.04 PAYMENT FOR OPTION SHARES
2.05 ACCELERATION
III. RESTRICTED STOCK AWARDS AND UNITS
3.01 TERMS OF RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNITS
3.02 TRANSFERABILITY
3.03 OTHER RESTRICTIONS
3.04 CERTIFICATE LEGEND
3.05 REMOVAL OF RESTRICTIONS
3.06 VOTING AND DIVIDEND RIGHTS
IV. PERFORMANCE AWARDS
4.01 PERFORMANCE AWARDS
V. TERMINATION OF EMPLOYMENT AND SERVICES
5.01. OPTIONS
5.02 RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNITS
5.03 PERFORMANCE AWARDS
5.04 OTHER PROVISIONS
VI. ADJUSTMENTS AND CHANGE IN CONTROL
6.01 ADJUSTMENTS
6.02 CHANGE IN CONTROL
6.03 MERGER
VII. MISCELLANEOUS
7.01 PARTIAL EXERCISE/FRACTIONAL SHARES
7.02 RULE 16B-3 REQUIREMENTS
7.03 RIGHTS PRIOR TO ISSUANCE OF SHARES
7.04 NON-ASSIGNABILITY
7.05 SECURITIES LAWS
7.06 WITHHOLDING AND TAXES
7.07 TERMINATION AND AMENDMENT
7.08 EFFECT ON EMPLOYMENT OR SERVICES
7.09 USE OF PROCEEDS
7.10 APPROVAL OF PLAN
7.11 GOVERNING LAW
EXHIBIT B
RESTRICTED STOCK AWARD AGREEMENT
1. GRANT OF RESTRICTED STOCK AWARD
2. RESTRICTIONS ON TRANSFER OF SHARES SUBJECT TO AWARD
3. NON-ASSIGNABILITY OF AWARD
4. ADJUSTMENTS
5. RIGHTS AS SHAREHOLDER
6. WITHHOLDING
7. NOTICES
8. GOVERNING LAW
9. PROVISIONS OF PLAN CONTROLLING
EXHIBIT C
NONQUALIFIED STOCK OPTION AGREEMENT
1. EXERCISE PRICE
2. OPTION EXERCISE
(a) Vesting
(b) Notice
(c) Payment Terms
3. TERMINATION OF EMPLOYMENT
4. OPTIONEE'S AGREEMENT
5. WITHHOLDING
6. RIGHTS AS SHAREHOLDER
7. NON-TRANSFERABILITY OF OPTION
8. ADJUSTMENTS
9. NO RIGHT TO EMPLOYMENT
10. AMENDMENT AND TERMINATION OF OPTION
11. NOTICES
12. APPLICABLE LAW
NOTICE OF EXERCISE
SCHEDULE A
VESTING SCHEDULE*
EXHIBIT D
MANAGEMENT INCENTIVE PLAN
I. PURPOSE:
II. ELIGIBILITY:
III. PERFORMANCE MEASUREMENT FACTORS:
IV. AWARD LIMITATIONS:
V. AWARD PAYMENTS:
VI. ADDITIONAL PROVISIONS:
VII. DISCRETIONARY GUIDELINES:
EXHIBIT E
CHANGE IN CONTROL AGREEMENT
EXHIBIT F
INDEMNIFICATION AGREEMENT
1. Definitions
2. Services by Director
3. Indemnification
4. Expenses
5. Right of the Director to Bring Suit
6. Assumption of Claim
7. Establishment of Trust
8. Non-Exclusivity of Rights
9. Settlement
10. Notice of Claim
11. Severability
12. Choice of Law
13. Successors and Assigns
14. Amendment
EXHIBIT G
DATASCENSION INTERNATIONAL STOCK COMPENSATION PLAN
I. GENERAL PROVISIONS
1.01 PURPOSE
1.02 STOCK
1.03 Restricted Stock Award
II. RESTRICTED STOCK AWARDS AND UNITS
2.01 TERMS OF RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNITS
2.02 OTHER RESTRICTIONS
2.03 CERTIFICATE LEGEND
2.04 REMOVAL OF RESTRICTIONS
III. ADJUSTMENTS AND CHANGE IN CONTROL
3.01 ADJUSTMENTS
3.02 CHANGE IN CONTROL
IV. MISCELLANEOUS
4.01 PARTIAL EXERCISE/FRACTIONAL SHARES
4.02 RULE 16B-3 REQUIREMENTS
4.03 RIGHTS PRIOR TO ISSUANCE OF SHARES
4.04 NON-ASSIGNABILITY
4.05 SECURITIES LAWS
4.06 WITHHOLDING AND TAXES
4.07 TERMINATION AND AMENDMENT
4.08 EFFECT ON EMPLOYMENT OR SERVICES
4.09 USE OF PROCEEDS
4.10 APPROVAL OF PLAN
4.11 GOVERNING LAW
EXHIBIT H
RESTRICTED STOCK AWARD AGREEMENT
1. GRANT OF RESTRICTED STOCK AWARD
2. RESTRICTIONS ON TRANSFER OF SHARES SUBJECT TO AWARD
3. NON-ASSIGNABILITY OF AWARD
4. ADJUSTMENTS
5. RIGHTS AS SHAREHOLDER
6. WITHHOLDING
7. NOTICES
8. GOVERNING LAW
9. PROVISIONS OF PLAN CONTROLLING
Page 1 of 63
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into as of November 1, 2004 and shall
be effective as of January 1, 2004, by and between Xxxxx X. Xxxxxx (the
"Executive") and Datascension Inc. f/k/a Nutek Inc, a Nevada corporation (the
"Company"),
WITNESSETH THAT:
WHEREAS, the Board of Directors of the Company has determined that it is
in the best interests of the Company's shareholders to encourage the continued
executive leadership of the Employee; and
WHEREAS, the Board of Directors has determined that it is in the best
interests of the shareholders to bring the contractual employment arrangements
of the Employee and the Board of Directors into greater conformity; and
WHEREAS, the employee is willing for his current employment agreement with
the Company to terminate simultaneously with the commencement of the term of
this Agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual provisions
contained herein, and for other good and valuable consideration, the parties
agree to enter into this Agreement and to agree with each other as follows:
1. Employment. Subject to the terms of this Agreement, the Company
hereby agrees to employ the Executive as its Chief Operating Officer of
Datascension, Inc and President of Datascension International, Inc (a wholly
owned subsidiary) during the Agreement Term (as defined below), with such
authority, power, responsibilities and duties customarily exercised by a person
holding such positions in a company of the size and nature of the Company.
Executive shall hold the titles of Chief Operating Officer and Director of
Datascension Inc., and Chairman, and President of Datascension International
Inc. (the "Company"). In his positions with the Company, the Executive shall
only report directly to the Board of Directors of the Company (the "Board").
This contract shall take effect on January 1, 2004 (the "Effective Date"). The
"Agreement Term" shall be the period beginning on the Effective Date and ending
on the fifth anniversary of the Effective Date; provided, however, the
Agreement Term will be automatically extended by twelve months on the first
anniversary of the Effective Date and on each anniversary thereof, unless one
party to this Agreement provides written notice of non-renewal to the other
party within 30 days prior to the date of such automatic extension.
2. Performance of Duties. The Executive agrees that during his
employment with the Company, he shall devote his full business time, energies
and talents to serving in the positions described in Section 1 and that he
shall perform his duties faithfully and efficiently subject to the directions
of the Board. Notwithstanding the foregoing provisions of this Section 2, the
Executive may (i) serve as a director, trustee or officer or otherwise
participate in not-for-profit educational, welfare, social, religious and civic
organizations; (ii) serve as a director of any for-profit business, with the
prior consent of the Board (which consent shall not be unreasonably withheld);
and (iii) acquire passive investment interests in one or more entities, to the
extent that such other activities do not inhibit or interfere with the
performance of the Executive's duties under this Agreement, or to the knowledge
of the Executive conflict in any material way with the business or policies of
the Company or any subsidiary or affiliate thereof.
3. Compensation. Subject to the terms of this Agreement, during the
Agreement Term, while the Executive is employed by the Company, the Company
shall compensate him for his services as follows:
(a) Base Salary. The Executive shall receive an annual base salary of
$150,000 payable in monthly or more frequent installments in accordance with
the Company's payroll policies (such annual base salary as adjusted pursuant to
this Section 3(a) shall hereinafter be referred to as "Base Salary"). The
Executive's Base Salary shall be reviewed, and may be increased but not
decreased, annually, by the Board pursuant to its normal performance review
policies for senior executives, with the first such review occurring not later
than December 2004.
Should the Company for any reason be unable to pay the Executive monthly or
more frequent installments in accordance with the Company's payroll policies,
the Executive may elect either of the following alternatives, or a combination
thereof;
(i) Executive may elect to treat the unpaid compensation as a loan
payable on demand that accrues an annual interest of ten (10) percent,
(ii) Executive may elect to receive common stock of the Company
issued under an S-8 registration statement which will provide the Executive
common stock at fair market value based on the average closing price for the
five (5) trading days preceding the request for issuance of stock for the
effective pay period. Executive may also elect to receive common stock of the
Company issued under an S-8 registration statement which will provide the
Executive common stock at fair market value based on the average closing price
of the five (5) trading days preceding the request for issuance of stock for
the loan payable on demand pursuant to subsection 3(a)(i).
(b) Initial Restricted Stock Award. The Company shall make an initial
signing award to the Executive as of the Effective Date of 100,000 restricted
shares of the Company's common stock under and subject to the terms and
conditions of the Stock Compensation Plan (the "Stock Plan"), a copy of which
is attached hereto as Exhibit A. The Executive shall vest in 50% of such shares
on the 90th day following the Effective Date and 50% on the six month
anniversary of the Effective Date. The foregoing award of restricted stock
shall be evidenced by a restricted stock award agreement, which is attached
hereto as Exhibit B and made a part of this Agreement.
(c) Initial Option Award. The Company shall make an award to the
Executive under the Stock Plan within 90 days of the Effective Date of a
nonqualified option to purchase 540,000 shares of the Company's common stock at
a per share price equal to the fair market value of the common stock on the
grant date (which will be the Effective Date) and an exercise period equal to
five (5) years (the "Initial Option"), subject to the following:
(i) For purposes of Section 162(m) of the Internal Revenue Code of 1986,
as amended (the "Code") shareholders of the Company voted and approved the
Board of Directors to provide the Executives with new employment packages at
the annual meeting.
(ii) Subject to the foregoing subsection 3(c)(i), the Initial Option shall
vest and become exercisable based upon the Company's performance, in accordance
with the option vesting formula utilized for other Company executives under the
Stock Plan as provided in the Executive's stock option agreement.
(iii) The foregoing award of the Initial Option shall be evidenced by a
stock option agreement which is attached hereto as Exhibit C and made a part of
this Agreement.
(d) Subsequent Restricted Stock Option Award. The Company shall make
an additional award to the Executive of restricted shares of the Company's
common stock under and subject to the terms and conditions of the Stock
Compensation Plan (the "Stock Plan") as follows:
(i) The Company shall make an award to the Executive as on the Effective
Date of a spin off the Datascension International, Inc subsidiary of 50,000
restricted shares of the Company's common stock under and subject to the terms
and conditions of the Stock Compensation Plan (the "Stock Plan"), a copy of
which is attached hereto as Exhibit A.
(ii) The Company shall make a further award to the Executive as on the
Effective Date of the spin off subsidiary trading on a recognized exchange of
100,000 restricted shares of the Company's common stock or 50,000 restricted
shares of the Company's common stock if traded on the OTCBB (Over the Counter
Bulletin Board), under and subject to the terms and conditions of the Stock
Compensation Plan (the "Stock Plan"), a copy of which is attached hereto as
Exhibit A.
The foregoing awards of restricted stock shall be evidenced by a restricted
stock award agreement, which is attached hereto as Exhibit B and made a part of
this Agreement.
(e) Annual Incentive Payments. The Executive shall be eligible to
receive an annual incentive payment (the "Incentive Payment") as determined in
accordance with the Company's Management Incentive Plan or any successor
thereto (the "Incentive Plan"), a copy of which is attached hereto as Exhibit
D. The Executive's target Incentive Payment for 2005 shall be 30% of his salary
range for such year, such target percentage for 2006 to be reviewed by the
Board not later than January 2006.
(f) Employee Benefits, Fringe Benefits and Perquisites. The Executive
shall be provided with employee benefits, fringe benefits and perquisites on a
basis no less favorable than such benefits and perquisites are provided by the
Company from time to time to the Company's other senior executives, including,
but not limited to, five weeks vacation and health, vision and dental
insurance. Notwithstanding any provision contained herein, at the time that the
Executive is eligible to participate in the Company's group health plan;
neither he nor any of his dependents will be subject to any pre-existing
condition provision contained in such plan.
(g) Change In Control. Upon the execution of this Agreement, the
Executive and the Company shall also execute a Change in Control Agreement
which is attached hereto as Exhibit E (the "Change in Control Agreement") and
made a part of this Agreement.
(h) Expense Reimbursement. The Company will reimburse the Executive
for all reasonable expenses incurred by him in the performance of his duties in
accordance with the Company's policies applicable to senior executives. Any
expenses not reimbursed within 30 calendar days of submission will be treated
similar to unpaid compensation as discussed in subsection 3(a)(i) at the option
of the Executive.
(i) Stock Splits. Any amounts to be issued in stock under this
Agreement will be adjusted for any stock splits unless issuance has already
been made to Executive.
(j) Spin Offs. In the event a subsidiary company is spun off and the
Executive is employed in the subsidiary on a full time basis, compensation will
then be paid by the subsidiary and not the parent. A new compensation
agreement will be executed for the Executive with the subsidiary, derived by
its Board of Directors with terms not to be less than those currently
effective. This agreement will then immediately terminate under the conditions
in subsection 5 (b).
In the event a subsidiary company is spun off and the executive is not employed
in the subsidiary, the Executive will be entitled to participate in an option
plan of that subsidiary that will be constructed prior to the completion of the
spin off in the same percentage ratios as those used for the Executive in the
parent company option plans.
(k) Stock Award and Options Datascension International, Inc. The Company
shall make an award and grant options to the Executive as of November 1, 2004
of 137,400 restricted shares of the Datascension International's common stock
under and subject to the terms and conditions of the Datascension International
Stock Compensation Plan (the "Stock Plan"), a copy of which is attached hereto
as Exhibit G. The Executive shall vest in 50% of such shares on the 90th day
following the Issue Date, 75% on the six month anniversary of the Issue Date
and 100% on the twelve month anniversary of the Issue Date. The foregoing award
of restricted stock shall be evidenced by a restricted stock award agreement,
which is attached hereto as Exhibit H and made a part of this Agreement.
4. Indemnification. Upon the execution of this Agreement, the
Executive and the Company shall also execute an Indemnification Agreement,
which is attached hereto as Exhibit F and made a part of this Agreement.
5. Termination of Employment. Upon termination of the Executive's
employment for any reason, the Executive or, in the event of death, the
Executive's estate shall be entitled to the Executive's Base Salary pro rated
through the date of termination. Any annual Incentive Payment earned by the
Executive for a prior award period, but not yet paid to the Executive, and any
employee benefits to which the Executive is entitled by reason of his
employment shall be paid to the Executive or his estate at such time as is
provided by the terms of the applicable Company plan or policy. If the
Executive's employment is terminated during the Agreement Term, the Executive's
right to additional payments and benefits under this Agreement for periods
after his date of termination shall be determined in accordance with the
following provisions of this Section 5.
(a) Death. If Executive's employment is terminated by reason of his
death, the Executive's spouse and eligible dependents, shall be eligible for
continued participation in all medical, dental, vision and hospitalization
insurance plans in which they were participating at the time of the Executive's
death for 18 months after the Executive's date of death, which shall run
concurrently with their COBRA rights. For the 18-month period described in this
Section 5(a), the Executive's spouse and eligible dependents shall pay no
portion of the premium or cost for such coverage.
(b) Termination for Cause or Voluntary Resignation. If the Executive's
employment is terminated by the Company for Cause or if the Executive
voluntarily resigns from the employ of the Company, other than pursuant to a
Constructive Discharge (as described in paragraph (d) of this Section 5), all
payments and benefits to which the Executive would otherwise be entitled under
this Agreement shall immediately cease, except as otherwise specifically
provided above in this Section 5 with respect to his pro rated Base Salary
through the date of termination, his annual Incentive Payment, if any, earned
for a prior award period and his previously earned employee benefits. For
purposes of this Agreement, the term "Cause" shall mean:
(i) the Executive is convicted of (i) a felony or (ii) any crime involving
moral turpitude resulting in reputational harm causing material injury
to the Company; or
(ii) a reasonable determination by a majority vote of directors at a
meeting
at which a quorum was present, that, in carrying out his duties, the
Executive has engaged in gross neglect or gross misconduct, resulting
in economic harm to the Company;
(iii) theft or embezzlement from the Company or any subsidiary; or
(iv) repeated violations of material Company policies, as may be adopted by
the Board from time to time, provided that the Company has given the
Executive written notice of each such violation and the Executive
fails to cure or is unable to cure each such violation within 10 days
after such respective notice.
(c) Termination Without Cause. If the Company terminates the Executive
without Cause:
(i) The Executive shall be entitled to a lump sum payment, within 60 days
following termination of his employment, of (A) two times his then
current Base Salary, plus (B) two times the average annual Incentive
Bonus paid to or earned by the Executive (whichever is larger) during
the three previous fiscal years during the Agreement Term or, if there
have not been three previous fiscal years during the Agreement Term,
such fewer number of fiscal years as shall have occurred during the
Agreement Term;
(ii) The Executive and his eligible dependents shall be entitled to
continued participation, at no cost to the Executive or his eligible
dependents, in all medical, dental, vision and hospitalization
insurance coverage, until the earlier of 18 months following
termination of employment or the date on which he receives equivalent
coverage and benefits from a subsequent employer. The time period
described in this Section 5(c)(ii) shall run concurrently with the
COBRA rights of the Executive and his eligible dependents.
(iii) All outstanding unvested stock options granted to the Executive prior
to his termination of employment shall vest, become immediately
exercisable and shall expire, if not exercised, at the earlier of the
third anniversary of such termination of employment or the "expiration
date" set forth in the applicable stock option agreement.
(iv) All outstanding unvested restricted shares of the Company's stock
awarded to the Executive prior to his termination of employment shall
vest immediately upon the Executive's termination of employment.
(d) Constructive Discharge. A Constructive Discharge by the Company
shall be treated for all purposes of this Agreement as a termination by the
Company without Cause. If (x) the Executive provides written notice to the
Company of the occurrence of Good Reason (as defined below) within a reasonable
time after the Executive has knowledge of the circumstances constituting Good
Reason, which notice shall specifically identify the circumstances which the
Executive believes constitute Good Reason; (y) the Company fails to correct the
circumstances within 30 days after such notice; and (z) the Executive resigns
within ninety days after the date of delivery of the notice referred to in
clause (x) above, then the Executive shall be considered to have been subject
to a Constructive Discharge by the Company. For purposes of this Agreement,
"Good Reason" shall mean, without the Executive's express written consent (and
except in consequence of a prior termination of the Executive's employment),
the occurrence of any of the following circumstances:
(i) A reduction by the Company in the Executive's Base Salary to an amount
that is less than required under Section 3(a).
(ii) The failure of the Executive to be elected or reelected to any of the
positions described in Section 1 or his removal from any such
position.
(iii) A material diminution in the Executive's duties. In the event of a
Change of Control (as defined in the Change in Control Agreement), the
mere fact that the Company ceases to be publicly traded or is a
subsidiary of another corporation shall not constitute Good Reason
under this clause (iii).
(iv) A change in the Executive's reporting relationship such that the
Executive no longer reports directly to the Board.
(v) A breach by the company of any of its material obligations to the
Executive under this Agreement.
The Executive shall be entitled to severance compensation under sections 5 (c)
and (d) based on the following formula:
Employed 5 years or more, then 100% of 5(c)(i)
Employed 4 years or more, but less than 5 years; then 75% of 5(c)(i)
Employed 3 years or more, but less than 4 years; then 50% of 5(c)(i)
Employed 2 years or more, but less than 3 years; then 25% of 5(c)(i)
Employed 1 year or more, but less than 2 years; then 10% of 5(c)(i)
Employed less than 1 year, only what is currently due
The terms of Sections 5 (c)(ii), (iii) and (iv) will not be affected by length
of employment of Executive. Employment with Company will be defined as the
period Executive has been employed by Company or its subsidiaries.
(e) Termination Due to Employment Order. It shall be grounds for
termination of this Agreement by the Company if the Executive is prohibited
from substantially fulfilling his obligations under this Agreement as a result
of an injunction or other order that (i) was obtained from a court of competent
jurisdiction by any former employer of the Executive, and (ii) has been or will
be in effect for a period of at least 60 days (an "Employment Order"). If the
Company terminates the Executive due to an Employment Order:
(i) The Executive shall be entitled to a lump sum payment, within 60 days
following termination of his employment, of (A) 0.5 times his then
current Base Salary, plus (B) 0.5 times the average annual Incentive
Bonus paid to or earned by the Executive (whichever is larger) during
the three previous fiscal years during the Agreement Term or, if there
have not been three previous fiscal years during the Agreement Term,
such fewer number of fiscal years as shall have occurred during the
Agreement Term;
(ii) The Executive and his eligible dependents shall be entitled to
continued participation, at no cost to the Executive or his eligible
dependents, in all medical, dental, vision and hospitalization
insurance coverage, until the earlier of 18 months following
termination of employment or the date on which he receives equivalent
coverage and benefits from a subsequent employer. The time period
described in this Section 5(e)(ii) shall run concurrently with the
COBRA rights of the Executive and his eligible dependents.
(iii) One-eighth of all outstanding unvested stock options granted to the
Executive prior to his termination of employment shall vest, become
immediately exercisable and shall expire, if not exercised, at the
earlier of the third anniversary of such termination of employment or
the "expiration date" set forth in the applicable stock option
agreement. The remaining one-half of such stock options shall
terminate.
(iv) One-eighth of all outstanding unvested restricted shares of the
Company's
stock awarded to the Executive prior to his termination of employment
shall vest immediately upon the Executive's termination of employment.
The remaining one-half of such restricted shares shall be forfeited.
(f) Non-renewal of Agreement by the Company. The normal expiration of
this Agreement at the end of the Agreement Term shall be treated for all
purposes of this Agreement as a termination by the Company without Cause, if:
(i) The Company provides written notice to the Executive of non-renewal of
the Agreement Term in accordance with Section 1;
(ii) The Executive continues to serve the Company in accordance with this
Agreement for the remainder of the Agreement Term; and
(iii) The Executive's employment with the Company is terminated after the
expiration of this Agreement and prior to age 65 for any reason other
than disability.
(g) No Mitigation; No Offset. In the event of any termination of
employment under this Section 5, the Executive shall be under no obligation to
seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration received by the
Executive from any subsequent employer, except as provided in Sections 5(c)(ii)
or 5(e)(ii).
(h) Nature of Payments. Any amounts due under this Section 5 are in
the nature of severance payments considered to be reasonable by the Company and
are not in the nature of a penalty.
(i) Effect of Termination on Other Positions. If, on the date of
termination of employment with the Company, the Executive is a member of the
Board of Directors of the Company or any of the Company's direct subsidiaries,
(a direct subsidiary shall be defined as any subsidiary in which the Company
owns a majority interest) or holds any other position with the Company, or
other direct subsidiaries of the Company, the Executive shall be deemed to have
resigned from all such positions as of the date of his termination of
employment with the Company. Executive agrees to execute such documents and
take such other actions as the Company may request to reflect such resignation.
(j) Benefit Plans. If, for any period during which the Executive is
entitled to continued benefits under this Agreement, the Company reasonably
determines that the Executive cannot participate in any benefit plan because he
is not actively performing services for the Company, then, in lieu of providing
benefits under any such plan, the Company shall provide comparable benefits or
the cash equivalent of the cost thereof (after taking into account all tax
consequences thereof to the Executive and the Executive's dependents as the
case may be) to the Executive and, if applicable, the Executive's dependents
through other arrangements.
(k) Other Severance Arrangements. Except as may be otherwise
specifically provided in the Change In Control Agreement, the Executive's
rights under this Section 5 shall be in lieu of any benefits that may be
otherwise payable to or on behalf of the Executive pursuant to the terms of any
severance pay arrangement of the Company or any subsidiary or any other similar
arrangement of the Company or any subsidiary providing benefits upon
involuntary termination of employment (including, without limitation, any
executive management separation plan). In the event of a change in control as
defined under the Change In Control Agreement, the benefits provided under the
Change In Control Agreement shall be in lieu of any severance benefits that may
be otherwise payable under this Agreement.
(l) Return of Company Property. Upon termination of employment with
the Company for any reason, the Executive shall promptly return to the Company
any keys, credit cards, passes, confidential documents or material, or other
property belonging to the Company, and the Executive shall also return all
writings, files, records, correspondence, notebooks, notes and other documents
and things (including any copies thereof) containing confidential information
or relating to the business or proposed business of the Company or its
subsidiaries or affiliates or containing any trade secrets relating to the
Company or its subsidiaries or affiliates except any personal diaries,
calendars, rolodexes or personal notes or correspondence. For purposes of the
preceding sentence, the term "trade secrets" shall have the meaning ascribed to
it under the Uniform Trade Secrets Act. The Executive agrees to represent in
writing to the Company upon termination of employment that he has complied with
the foregoing provisions of this Section 5(l).
(m) Adverse Actions. Executive agrees that following his termination
of employment with the Company for any reason until the second anniversary of
such termination of employment without the prior written consent of the Company
the Executive shall not, in any manner, solicit, request, advise or assist any
other person or entity to (a) undertake any action that would be reasonably
likely to, or is intended to, result in a Change in Control (as defined in the
Change in Control Agreement), or (b) seek to control in any material manner the
Board.
(n) Mutual Nondisparagement. Each party agrees that, following the
Executive's termination of employment; such party will not make any public
statements, which materially disparage the other party. Notwithstanding the
foregoing, nothing in this Section 5(n) shall prohibit any person from making
truthful statements when required by order of a court or other governmental or
regulatory body having jurisdiction.
(o) Loans to Company. Company agrees that following the termination of
employment, any and all loans outstanding on the books of the Company which are
due to the Executive shall be reimbursed within 15 business days.
(p) Personal Guarantees. Company agrees that following the termination
of employment, any and all personal guarantees provided by Executive for the
Company shall be removed or replaced by the Company within 15 business days.
6. Confidential Information. The Executive agrees that, during his
employment by the Company and at all times thereafter, he shall hold in a
fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or any of its
subsidiaries or affiliates, and their respective businesses, which shall have
been obtained by the Executive during the Executive's employment by the Company
or during his consultation with the Company after his termination of
employment, and which shall not be or become public knowledge (other than by
acts by the Executive or representatives of the Executive in violation of this
Agreement). Except in the good faith performance of his duties for the Company,
the Executive shall not, without the prior written consent of the Company or as
may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Company and those
designated by it.
7. Nonsolicitation. For the three year period following his
termination of employment with the Company, the Executive shall not solicit any
individual who is, on the date of his termination of employment, employed by
the Company or its subsidiaries or affiliates to terminate or refrain from
renewing or extending such employment or to become employed by or become a
consultant to any other individual or entity other than the Company or its
subsidiaries or affiliates, and the Executive shall not initiate discussion
with any such employee for any such purpose or authorize or knowingly cooperate
with the taking of any such actions by any other individual or entity on behalf
of the Executive's employer.
8. Noncompetition. The Executive agrees that he will not engage in
Competition (as defined below) while he is employed by the Company. In the
event that the Executive engages in Competition within the three-year period
immediately following the termination of his employment with the Company for
any reason, (i) his Initial Option shall be immediately forfeited to the extent
not previously exercised and (ii) he shall forfeit (or, in the case of prior
payment to the Executive, shall repay together with interest at the Applicable
Federal Rate, determined in accordance with Section 1274(d) of the Internal
Revenue Code or any successor provision thereto) a pro rata portion of the
severance payment provided for in Section 5(c)(i). Such pro rata portion shall
be based upon (x) the number of days remaining between the first day on which
the Executive engages in Competition and the third anniversary of his last day
of employment by the Company, divided by (y) 1095. The Company's sole remedy
for the breach of this Section following his termination of employment shall be
as set forth in the preceding two sentences. The Executive shall be deemed to
be engaging in "Competition" if he directly or indirectly, owns, manages,
operates, controls or participates in the ownership, management, operation or
control of or is connected as an officer, employee, partner, director,
consultant or otherwise with, or has any financial interest in, any business
engaged in the financial services business (a "Competing Business") in any
state in which the Company or its subsidiaries or affiliates now or hereafter
operate a commercial banking or other material financial services business
which is a material part of such business and is in material competition with
the business conducted by the Company at the time of the termination of his
employment with the Company or its subsidiaries or affiliates. Notwithstanding
the foregoing sentence, the Executive shall not be deemed to be engaging in
Competition under the circumstances described in the foregoing sentence if the
Executive (i) does not own or control the Competing Business, (ii) does not
serve as a director or a consultant to the Competing Business, and (iii) does
not have any management or operational responsibility for the Competing
Business in any such state. Ownership for personal investment purposes only of
less than 2% of the voting stock of any publicly held corporation shall not
constitute a violation hereof.
9. Equitable Remedies. The Executive acknowledges that the Company
would be irreparably injured by a violation of Section 5(m), 6 or 7 or the
first sentence of Section 8 (Competition while employed by the Company) and he
agrees that the Company, in addition to any other remedies available to it for
such breach or threatened breach, shall be entitled to a preliminary
injunction, temporary restraining order, or other equivalent relief,
restraining the Executive from any actual or threatened breach of Section 5(m),
6 or 7 or the first sentence of Section 8. If a bond is required to be posted
in order for the Company to secure an injunction or other equitable remedy, the
parties agree that said bond need not be more than a nominal sum.
10. Assistance with Claims. Executive agrees that, consistent with the
Executive's business and personal affairs, during and after his employment by
the Company, he will assist the Company and its subsidiaries and affiliates in
the defense of any claims, or potential claims that may be made or threatened
to be made against any of them in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "Proceeding"), and will
assist the Company and its affiliates in the prosecution of any claims that may
be made by the Company or any subsidiary or affiliate in any Proceeding, to the
extent that such claims may relate to the Executive's employment or the period
of Executive's employment by the Company. Executive agrees, unless precluded by
law, to promptly inform the Company if Executive is asked to participate (or
otherwise become involved) in any Proceeding involving such claims or potential
claims. Executive also agrees, unless precluded by law, to promptly inform the
Company if Executive is asked to assist in any investigation (whether
governmental or private) of the Company or any subsidiary or affiliate (or
their actions), regardless of whether a lawsuit has then been filed against the
Company or any subsidiary or affiliate with respect to such investigation. The
Company agrees to reimburse Executive for all of Executive's reasonable out-of-
pocket expenses associated with such assistance, including travel expenses and
any attorneys' fees and shall pay a reasonable per diem fee for Executive's
services.
11. Assignability, Binding Nature. This Agreement shall be binding
upon and inure to the benefit of the Parties and their respective successors,
heirs (in the case of the Executive) and assigns. No rights or obligations of
the Company under this Agreement may be assigned or transferred by the Company
except that such rights or obligations may be assigned or transferred pursuant
to a merger or consolidation in which the Company is not the continuing entity,
or the sale or liquidation of all or substantially all of the assets of the
Company, provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and such assignee or transferee
assumes the liabilities, obligations and duties of the Company, as contained in
this Agreement, either contractually or as a matter of law. The Company further
agrees that, in the event of a sale of assets or liquidation as described in
the preceding sentence, it shall take whatever action it legally can in order
to cause such assignee or transferee to expressly assume the liabilities,
obligations and duties of the Company hereunder. No rights or obligations of
the Executive under this Agreement may be assigned or transferred by the
Executive other than his rights to compensation and benefits, which may be
transferred only by will or operation of law.
12. Amendment. This Agreement, including any Exhibit made a part
hereof, may be amended or canceled only by mutual agreement of the parties in
writing without the consent of any other person. So long as the Executive
lives, no person, other than the parties hereto, shall have any rights under or
interest in this Agreement or the subject matter hereof except that in the
event of the Executive's disability so as to render him incapable of such
action, his legal representative may be substituted for purposes of such
amendment.
13. Applicable Law. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Nevada, without
regard to the conflict of law provisions of any state. Any action to enforce
this Agreement shall be brought within the State of Nevada, in a court of
competent jurisdiction.
14. Severability. The invalidity or unenforceability of any provision
of this Agreement will not affect the validity or enforceability of any other
provision of this Agreement, and this Agreement will be construed as if such
invalid or unenforceable provision were omitted (but only to the extent that
such provision cannot be appropriately reformed or modified).
15. Waiver of Breach. No waiver by any party hereto of a breach of any
provision of this Agreement by any other party, or of compliance with any
condition or provision of this Agreement to be performed by such other party,
will operate or be construed as a waiver of any subsequent breach by such other
party of any similar or dissimilar provisions and conditions at the same or any
prior or subsequent time. The failure of any party hereto to take any action by
reason of such breach will not deprive such party of the right to take action
at any time while such breach continues.
16. Compliance with Law. Notwithstanding any provision contained in
this Agreement to the contrary, in the event a regulatory authority commences
an appropriate proceeding, action or order challenging the payment to Executive
of any benefit hereunder, or in the event any such payment hereunder is
otherwise prohibited by law, such benefit payment shall be suspended until such
time as the challenge is fully and finally resolved and the applicable
regulatory authority does not object to the payments or until such payments are
otherwise permitted by law. In the event that any challenge to the payments
required by this Agreement is initiated by a regulatory authority or other
person, the Company shall notify Executive of such challenge and shall promptly
proceed to attempt to resolve such challenge in a manner that enables the
Company to make to Executive all payments required hereunder.
17. Notices. Notices and all other communications provided for in this
Agreement shall be in writing and shall be delivered personally or sent by
registered or certified mail, return receipt requested, postage prepaid, or
prepaid overnight courier to the parties at the addresses set forth below (or
such other addresses as shall be specified by the parties by like notice):
to the Company:
Datascension, Inc.
0000 XxXxxx Xxxxx, Xxxxx 0
Xxx Xxxxx, XX 00000
Attention: General Counsel and Secretary
or to the Executive:
At the most recent address maintained
by the Company in its personnel records
Each party, by written notice furnished to the other party, may modify the
applicable delivery address, except that notice of change of address shall be
effective only upon receipt. Such notices, demands, claims and other
communications shall be deemed given in the case of delivery by overnight
service with guaranteed next day delivery, the next day or the day designated
for delivery; or in the case of certified or registered U.S. mail, five days
after deposit in the U.S. mail; provided, however, that in no event shall any
such communications be deemed to be given later than the date they are actually
received.
18. Executive's Representations. Executive hereby represents and
warrants to the Company that (i) except to the extent previously disclosed to
the Company in writing, the execution delivery and performance of this
Agreement by Executive does not and shall not conflict with, breach, violate or
cause a default under any contract, agreement, instrument, order, judgment or
decree to which Executive is a party or by which he is bound; (ii) except to
the extent previously disclosed to the Company in writing, Executive is not a
party to or bound by an employment agreement, non-compete agreement or
confidentiality agreement with any other person or entity which would interfere
in any material respect with the performance of his duties hereunder; and (iii)
Executive shall not use any confidential information or trade secrets in
connection with the performance of his duties hereunder.
19. Company's Representations. The Company represents and warrants
that it is fully authorized and empowered to enter into this Agreement, that
the Agreement has been duly authorized by all necessary corporate action, that
the performance of its obligations under this Agreement will not violate any
agreement between it and any other person, firm or organization or any
applicable law or regulation and that this Agreement is enforceable in
accordance with its terms.
20. Survivorship. Upon the expiration or other termination of this
Agreement, the respective rights and obligations of the parties hereto shall
survive such expiration or other termination to the extent necessary to carry
out the intentions of the parties under this Agreement.
21. Entire Agreement. Except as otherwise noted herein, this
Agreement, including the Exhibits thereto, constitutes the entire agreement
between the parties concerning the subject matter hereof and supersedes all
prior and contemporaneous agreements, if any, between the parties relating to
the subject matter hereof.
22. Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
IN WITNESS THEREOF, the Executive has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its behalf,
all as of the day and year first above written.
XXXXX X. XXXXXX DATASCENSION, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------- -----------------------------------
Executive Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
EXHIBIT A
STOCK COMPENSATION PLAN
Page 1 of 63
DATASCENSION INC.
STOCK COMPENSATION PLAN
EFFECTIVE JANUARY 1, 2004
I. GENERAL PROVISIONS
1.01 PURPOSE. The Plan, which was adopted by the Company's Board on
the Effective Date, is intended to attract and retain highly competent,
effective and loyal Employees and Non-Employee Directors so as to further the
growth and profitable operation of the Company and its Affiliates by
encouraging Employees and Non-Employee Directors of the Company and its
Affiliates to acquire an ownership interest in the Company through Options,
Restricted Stock Awards, Restricted Stock Units and Performance Awards, thus
identifying their interests with those of shareholders and encouraging them to
make greater efforts on behalf of the Company and its Affiliates to achieve the
Company's long-term business plans and objectives.
1.02 PARTICIPANTS. Participants in the Plan shall be such Employees
(including Employees who are directors) and Non-Employee Directors of the
Company and its Affiliates as the Committee may select from time to time. The
Committee may grant Options, Restricted Stock Awards, Restricted Stock Units
and Performance Awards to an individual upon the condition that the individual
become an Employee or Non-Employee Director of the Company or of an Affiliate,
provided that the Option, Restricted Stock Award, Restricted Stock Unit or
Performance Award shall be deemed to be granted only on the date that the
individual becomes an Employee or Non-Employee Director.
1.03 DEFINITIONS. As used in this Plan, the following terms have the
meaning described below:
(a) "AFFILIATE" OR "AFFILIATES" means a corporation or other
entity that is affiliated with the Company and includes any parent or
subsidiary of the Company, as defined in Code Sections 424(e) and (f),
respectively.
(b) AGREEMENT" means the written agreement that sets forth
the terms of a Participant's Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award.
(c) "BOARD" means the Board of Directors of the Company.
(d) "BUSINESS COMBINATION" means (1) any reorganization,
merger, share exchange or consolidation of the Company, or (2) any sale, lease,
exchange or other transfer of all or substantially all of the assets of the
Company.
(e) "CASHLESS EXERCISE PROCEDURE" means delivery to the
Company by a Participant exercising an Option of a properly executed exercise
notice, acceptable to the Company, together with irrevocable instructions to
the Participant's broker to deliver to the Company sufficient cash to pay the
exercise price and any applicable income and employment withholding taxes, in
accordance with a written agreement between the Company and the brokerage firm.
(f) "CAUSE" means (1) with respect to any Participant who is
a party to a written employment agreement with the Company or any Affiliate,
"Cause" as defined in such employment agreement, or (2) with respect to any
Participant who is not a party to a written employment agreement with the
Company or any Affiliate, personal dishonesty, willful misconduct, any breach
of fiduciary duty involving personal profit, intentional failure to perform
stated duties, willful violation of any law, rule or regulation (other than
traffic violations or similar offenses) or receipt of a final cease-and-desist
order. In determining willfulness, no act or failure to act on a Participant's
part shall be considered "willful" unless done or omitted to be done by the
Participant not in good faith and without reasonable belief that the
Participant's action or omission was in the best interests of the Company.
(g) "CHANGE IN CONTROL" means the occurrence of any of the
following events:
(1) If any "person" (as such term is used in
Sections 13(d) and 14(d) under the Exchange Act in effect on the date hereof),
or group of persons acting in concert, other than the Company or any Affiliate
or any employee benefit plan of the Company or an Affiliate becomes the
"beneficial owner" (as such term is defined in Rule 13d-3 of the Exchange Act),
directly or indirectly, of securities of the Company representing 20% or more
of either the Common Stock or the combined voting power of all classes of the
Company's Voting Stock. Notwithstanding the immediately preceding sentence,
(A) the beneficial ownership condition in this Section 1.03(g)(1) shall not be
deemed satisfied if the attainment of the applicable percentage of beneficial
ownership is the result of an acquisition of Common Stock or Voting Stock by
the Company which, by reducing the number of shares outstanding increases the
proportionate number of shares beneficially owned by any person; provided,
however, that if a person shall become the beneficial owner of 20% or more of
the outstanding Common Stock or Voting Stock then outstanding by reason of
share purchases by the Company and shall, after such share purchases become the
beneficial owner of any additional Common Stock or Voting Stock other than by a
purchase from the Company, then the beneficial ownership condition in this
Section 1.03(g)(1) shall be deemed to have been satisfied; (B) the following
acquisitions shall not constitute a Change in Control: (i) any acquisition
directly from the Corporation, or (ii) any acquisition by any corporation
pursuant to a transaction which complies with clauses (i), (ii) and (iii) of
Section 1.03(g)(3)(B).
(2) If the Incumbent Directors cease for any reason
to constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date hereof whose election or
nomination for election by the Company's shareholders was approved by a vote of
at least a majority of the directors then comprising the Incumbent Directors
(either by a specific vote or by approval of the proxy statement of the
Corporation in which such person is named as a nominee for director, without
written objection to such nomination) shall be considered to be an Incumbent
Director; provided further, that any such individual whose initial assumption
of office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies by or on behalf of a person other than the Board shall
not be considered an Incumbent Director.
(3) If there shall be consummated a Business
Combination, other than (A) a merger or consolidation effected to implement a
reorganization of the Company's ownership wherein the Company shall become a
wholly-owned subsidiary of another corporation and the shareholders of the
Company shall become shareholders of such other corporation without any
material change in each shareholder's proportionate ownership of such other
corporation from that owned in the Company prior to such merger or
consolidation; and (B) a Business Combination following which: (i) all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the outstanding Common Stock and outstanding Voting
Stock immediately prior to such Business Combination beneficially own, directly
or indirectly, more than 65% of, respectively, the then outstanding shares of
common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the Surviving Corporation in substantially the same proportions as
their ownership, immediately prior to such Business Combination, of the
outstanding Common Stock and Voting Stock, as the case may be; (ii) no person
or entity beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of the Surviving
Corporation or the combined voting power of the then outstanding voting
securities of the Surviving Corporation (excluding any person or entity who
beneficially owned 20% or more of the outstanding Common Stock or Voting Stock
prior to such Business Combination, the Surviving Corporation and any employee
benefit plan (or related trust) of the Company or the Surviving Corporation);
and (iii) at least a majority of the members of the board of directors of the
Surviving Corporation were Incumbent Directors immediately prior to the time of
the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination.
(4) Approval by the shareholders of the Company of
any plan or proposal for the liquidation or dissolution of the Company.
(h) "CODE" means the Internal Revenue Code of 1986, as
amended.
(i) "COMMITTEE" means the Board acting as a whole, or a
committee of two or more "non-employee directors" (as defined in Rule 16b-3
under the Exchange Act) who also constitute "outside directors" (as defined
under Code Section 162(m) if applicable at the time) if designated by the Board
to administer the Plan. The fact that a Committee member shall fail to qualify
under Rule 16b-3 under the Exchange Act or Code Section 162(m) shall not
invalidate any grant or award made by the Committee, if the grant or award is
otherwise validly granted under the Plan.
(j) "COMMON STOCK" means shares of the Company's authorized
and unissued common stock, or reacquired shares of such common stock.
(k) "COMPANY" means Datascension Inc., and any successor
thereto.
(l) "DISABILITY" means disability as defined in Section 22(e)
of the Code.
(m) "EFFECTIVE DATE" means January 1, 2004, the date on which
the Board adopted the Plan.
(n) "EMPLOYEE" means an employee of the Company or Affiliate,
who has an "employment relationship" with the Company or an Affiliate, as
defined in Treasury Regulation 1.421-7(h); and the term "employment" means
employment with the Company, or an Affiliate of the Company.
(o) "EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended from time to time and any successor thereto.
(p) "FAIR MARKET VALUE" means, with respect to a share of
Common Stock on the Grant Date, the average of the high and low sale prices of
Common Stock. In the event that there were no Common Stock transactions on such
date, the Fair Market Value shall be determined as of the immediately preceding
date on which there were Common Stock transactions. Unless otherwise specified
in the Plan, "Fair Market Value" for purposes of determining the value of
Common Stock on the date of exercise means the average of the high and low sale
prices of such Common Stock on the last five days preceding the exercise on
which there were Common Stock transactions.
(q) "GRANT DATE" means the date on which the Committee
authorizes an individual Option, Restricted Stock Award, Restricted Stock Unit
or Performance Award, or such later date as shall be designated by the
Committee.
(r) "INCENTIVE STOCK OPTION" means an Option that is intended
to meet the requirements of Section 422 of the Code and is designated as such
in the Agreement evidencing the grant.
(s) "INCUMBENT DIRECTORS" means the members of the Board on
the Effective Date.
(t) "NON-EMPLOYEE DIRECTOR" means a director of the Company
or an Affiliate who is not an Employee.
(u) "NONQUALIFIED STOCK OPTION" means an Option that is not
an Incentive Stock Option.
(v) "OPTION" means either an Incentive Stock Option or a
Nonqualified Stock Option.
(w) "PARTICIPANT" means the individuals described in Section
1.02.
(x) "PERFORMANCE AWARD" means a performance award granted
pursuant to Article IV.
(y) "PLAN" means the Datascension Inc., Stock Compensation
Plan, the terms of which are set forth herein, as amended from time to time.
(z) "RESTRICTED PERIOD" means the period of time during which
Common Stock subject to a Restricted Stock Award or Restricted Stock Unit is
subject to transfer restrictions that make it nontransferable.
(aa) "RESTRICTED STOCK" means Common Stock that is subject to
a Restricted Period, pursuant to Article III.
(bb) "RESTRICTED STOCK AWARD" means an award of Common Stock
that is subject to a Restricted Period, granted pursuant to Article III.
(cc) "RESTRICTED STOCK UNIT" means a right granted pursuant
to Article III to receive Restricted Stock or an equivalent value in cash
pursuant to the terms of the Plan and the related Agreement.
(dd) "RETIREMENT" means a Participant's voluntary cessation
of employment or status as a Non-Employee Director following the Participant's
65th birthday.
(ee) "SURVIVING CORPORATION" means the corporation resulting
from a Business Combination referred to in Section 1.03(g)(3)(B) of the Plan,
including, without limitation, the surviving corporation in a merger involving
the Company and a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either directly or
through one or more subsidiaries.
(ff) "VOTING STOCK" means the securities ordinarily having
the right to vote in the election of directors to the Board.
1.04 ADMINISTRATION. (a) The Plan shall be administered by the Board
of Directors, in accordance with Rule 16b-3 under the Exchange Act and Code
Section 162(m), if applicable. The Board, at any time and from time to time,
subject to Sections 2.02 and 7.07, may grant Options, Restricted Stock Awards,
Restricted Stock Units and Performance Awards to such Employees and Non-
Employee Directors and for such number of shares of Common Stock as it shall
designate. The Board shall interpret the Plan, prescribe, amend, and rescind
rules and regulations relating to the Plan, and make all other determinations
necessary or advisable for its administration. The decision of the Board on any
question concerning the interpretation of the Plan or its administration with
respect to any Option, Restricted Stock Award, Restricted Stock Unit or
Performance Award granted under the Plan shall be final and binding upon all
Participants.
(b) The Board may delegate to one or more officers or
managers of the Company, the authority, subject to such terms and limitations
as the Board shall determine, to grant Options, Restricted Stock Awards,
Restricted Stock Units and Performance Awards to, or to cancel, modify, waive
rights with respect to, alter, discontinue or terminate Options, Restricted
Stock Awards, Restricted Stock Units or Performance Awards held by Participants
who are not officers or directors of the Company for purposes of Section 16 of
the Exchange Act.
1.05 STOCK. The total number of shares of Company Common Stock
available for grants and awards under this Plan shall be 3,000,000; provided,
however, that the number of shares subject to Restricted Stock Awards,
Restricted Stock Units and Performance Awards under this Plan shall not exceed
2,500,000. The maximum number of shares of Common Stock that may be subject to
Option grants under the Plan to any salaried employee during any one-year
period shall not exceed 500,000 shares. Shares subject to any portion of a
terminated, forfeited, cancelled or expired Option, Restricted Stock Award,
Restricted Stock Unit or Performance Award granted hereunder may again be
subjected to grants and awards under the Plan as of the date of such
termination, forfeiture, cancellation or expiration. All amounts in this
Section 1.05 shall be adjusted, as applicable, in accordance with Article VI.
II. STOCK OPTIONS
2.01 GRANT OF OPTIONS. The Board may grant Options to Participants
and, to the extent Options are granted, shall determine the general terms and
conditions of exercise, including any applicable vesting or performance
requirements, which shall be set forth in a Participant's Agreement. The Board
may designate any Option granted as either an Incentive Stock Option or a
Nonqualified Stock Option, or the Board may designate a portion of an Option as
an Incentive Stock Option and the remainder as a Nonqualified Stock Option. No
Option shall have an exercise period that extends beyond 5 years from the Grant
Date. Any Participant may hold more than one Option, Restricted Stock Award,
Restricted Stock Unit or Performance Award under the Plan and any other plan of
the Company or Affiliate.
2.02 INCENTIVE STOCK OPTIONS. Any Option intended to constitute an
Incentive Stock Option shall comply with the requirements of this Section 2.02
and shall only be granted to an Employee. No Incentive Stock Option shall be
granted with an exercise price below its Fair Market Value on the Grant Date.
An Incentive Stock Option shall not be granted to any Participant who owns
(within the meaning of Code Section 424(d)) stock of the Company or any
Affiliate possessing more than 15% of the total combined voting power of all
classes of stock of the Company or an Affiliate unless, at the Grant Date, the
exercise price for the Option is at least 110% of the Fair Market Value of the
shares subject to the Option and the Option, by its terms, is not exercisable
more than one (1) year after the Grant Date. The aggregate Fair Market Value of
the underlying Common Stock (determined at the Grant Date) as to which
Incentive Stock Options granted under the Plan (including a plan of an
Affiliate) may first be exercised by a Participant in any one calendar year
shall not exceed $100,000. To the extent that an Option intended to constitute
an Incentive Stock Option shall violate the foregoing $100,000 limitation (or
any other limitation set forth in Code Section 422), the portion of the Option
that exceeds the $100,000 limitation (or fails any other Code Section 422
requirement) shall be deemed to constitute a Nonqualified Stock Option.
2.03 OPTION PRICE. The Board shall determine the per share exercise
price for each Option granted under the Plan, but no Option shall be granted
with an exercise price below 100% of the Fair Market Value of Common Stock on
the Grant Date.
2.04 PAYMENT FOR OPTION SHARES. The purchase price for shares of
Common Stock to be acquired upon exercise of an Option granted hereunder shall
be paid in full in cash or by personal check, bank draft or money order at the
time of exercise; provided, however, that in lieu of such form of payment, the
Committee may permit a Participant to pay such purchase price in whole or in
part by tendering shares of Common Stock that have been held at least six
months, which are freely owned and held by the Participant independent of any
restrictions, hypothecations or other encumbrances, duly endorsed for transfer
(or with duly executed stock powers attached), or in any combination of the
above. If shares of Common Stock are tendered in payment of all or part of the
exercise price, they shall be valued for such purpose at their Fair Market
Value on the date of exercise.
2.05 ACCELERATION. The Board may, in its discretion, accelerate a
Participant's right to exercise an Option.
III. RESTRICTED STOCK AWARDS AND UNITS
3.01 TERMS OF RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNITS. The
Board shall have the authority to grant Restricted Stock Awards and Restricted
Stock Units to such Participants and for such number of shares of Common Stock
as it shall designate. Such Awards and Units shall be evidenced by an Agreement
that shall specify the terms thereof, including the Restricted Period, the
number of shares of Common Stock subject to the Award or Unit, and such other
provisions, which may include, among other things, vesting and performance
goals, as the Board shall determine.
3.02 TRANSFERABILITY. Except as provided in this Article III of the
Plan, the shares of Common Stock subject to a Restricted Stock Award or
Restricted Stock Unit may not be transferred, pledged, assigned, or otherwise
alienated or hypothecated until the termination of (a) the applicable
Restricted Period or for such period of time as shall be established by the
Board and specified in the applicable Agreement, or (b) upon the earlier
satisfaction of other conditions as specified by the Board and set forth in the
applicable Agreement. Prior to the end of the Restricted Period, all rights
with respect to the Common Stock subject to a Restricted Stock Award or
Restricted Stock Unit granted to a Participant shall be exercisable during the
Participant's lifetime only by the Participant or the Participant's legal
representative.
3.03 OTHER RESTRICTIONS. The Board shall impose such other
restrictions on any shares of Common Stock subject to a Restricted Stock Award
or Restricted Stock Unit as it may deem advisable including, without
limitation, restrictions under applicable federal or state securities laws, and
shall legend any certificates representing such shares to give appropriate
notice of such restrictions.
3.04 CERTIFICATE LEGEND. In addition to any legends placed on
certificates pursuant to Section 3.03, any certificate representing shares of
Common Stock subject to a Restricted Stock Award or Restricted Stock Unit shall
bear the following legend:
The sale or other transfer of the shares of stock represented by this
certificate, whether voluntary, involuntary or by operation of law, is
subject to certain restrictions on transfer set forth in the
Datascension Inc., Stock Compensation Plan (the "Plan"), rules and
administrative guidelines adopted pursuant to such Plan and an
Agreement dated ___________,____. A copy of the Plan, such rules and
such
Agreement may be obtained from the Secretary of the Company.
3.05 REMOVAL OF RESTRICTIONS. Except as otherwise provided under the
Plan, if the Restricted Period has elapsed or been waived by the Board with
respect to all or a portion of the Restricted Shares represented by a
certificate, the holder thereof shall be entitled to have the legend required
by Section 3.04 removed from such stock certificate with respect to the shares
as to which the Restricted Period has elapsed. Any certificate evidencing the
remaining shares shall bear the legend required by Section 3.04. The Board
shall have the discretion to waive the applicable Restricted Period with
respect to all or any part of the Common Stock subject to a Restricted Stock
Award or Restricted Stock Unit. The Company shall have the right to retain any
certificate representing shares of Common Stock subject to a Restricted Stock
Award or Restricted Stock Unit until such time as all conditions and/or
restrictions applicable to such shares of Common Stock have been satisfied.
3.06 VOTING AND DIVIDEND RIGHTS. During the Restricted Period,
Participants shall be considered record owners of any shares of Common Stock
subject to any Restricted Stock Award or Restricted Stock Unit held by them for
purposes of determining who is entitled to vote or receive dividends with
respect to such shares. If any dividends or distributions are paid in shares of
Common Stock during the Restricted Period, the dividend or other distribution
shares shall be subject to the same restrictions on transferability as the
shares of Common Stock with respect to which they were paid.
IV. PERFORMANCE AWARDS
4.01 PERFORMANCE AWARDS. The Board is authorized to grant Performance
Awards to eligible Participants. Subject to the terms of the Plan, a
Performance Award granted under the Plan (a) may be denominated or payable in
cash or shares of Common Stock (including, without limitation, Restricted
Stock), and (b) shall confer on the holder thereof rights valued as determined
by the Board and payable to, or exercisable by, the holder of the Performance
Award, in whole or in part, upon the achievement of such performance goals
during such performance period, as the Board shall establish. Subject to the
terms of the Plan, the performance goals to be achieved during any performance
period, the length of any performance period, the amount of any Performance
Award granted, the amount of any payment or transfer to be made pursuant to any
Performance Award, and the other terms and conditions of any Performance Award,
including the effect upon such Award of termination of the Participant's
employment and/or directorship, shall be determined by the Committee.
V. TERMINATION OF EMPLOYMENT AND SERVICES
5.01. OPTIONS.
(a) Unless otherwise provided in the applicable Agreement,
if, prior to the date that an Option first becomes exercisable, a Participant's
status as an Employee and Non-Employee Director is terminated for any reason,
the Participant's right to exercise the Option shall terminate and all rights
thereunder shall cease as of the close of business on the date of such
termination.
(b) For any Nonqualified Stock Option unless otherwise
provided in the applicable Agreement and for any Incentive Stock Option, if, on
or after the date that the Option first becomes exercisable, a Participant's
status as an Employee and Non-Employee Director is terminated (1) for Cause,
any unexercised portion of the Option (whether then exercisable or not) shall,
as of the time of the Cause determination, immediately terminate, (2) due to
death or Disability, then the Option, to the extent that it is exercisable on
the date of termination, shall be exercisable only until the earlier of the one
year anniversary of such termination or the "expiration date" set forth in the
applicable Agreement, (3) for any other reason (except as provided in the next
sentence), then the Option, to the extent that it is exercisable on the date of
termination, shall be exercisable only until the earlier of the three month
anniversary of such termination or the "expiration date" set forth in the
applicable Agreement. For any Nonqualified Stock Option, unless otherwise
provided in the applicable Agreement, if, on or after the date that the Option
first becomes exercisable, a Participant's status as an Employee and Non-
Employee Director is terminated due to Retirement, or if a Participant is a
party to a Change in Control Agreement with the Company and such Participant's
status as an Employee and Non-Employee Director is terminated involuntarily or
constructively in accordance with paragraph 3 thereof, then the Option, to the
extent that it is exercisable on the date of termination, shall be exercisable
until the "expiration date" set forth in the applicable Agreement. The Board,
at its discretion, may designate in the applicable Agreement a different post-
termination period for exercise of a Nonqualified Stock Option and may extend
the exercise period of any Option, but in no event may the post-termination
exercise period exceed the tenth anniversary of the Grant Date; it being
understood that the extension of the exercise term for an Incentive Stock
Option may cause such Option to become a Nonqualified Stock Option.
(c) Shares subject to Options that are not exercised within
the time allotted for exercise shall expire and be forfeited by the Participant
as of the close of business on the date they are no longer exercisable.
5.02 RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNITS. Unless
otherwise provided in the applicable Agreement, if the status as an Employee
and Non-Employee Director of a Participant holding a Restricted Stock Award or
Restricted Stock Unit terminates for any reason other than Retirement, death or
Disability prior to the lapse of the Restricted Period, any shares of Common
Stock subject to a Restricted Stock Award or Restricted Stock Unit as to which
the Restricted Period has not yet lapsed or been waived shall be forfeited by
the Participant; provided, however, that the Board, in its sole discretion, may
waive or change the remaining restrictions or add additional restrictions with
respect to any Restricted Stock Award or Restricted Stock Unit that would
otherwise be forfeited, as it deems appropriate. Unless otherwise provided in
the applicable Agreement, if the status as an Employee and Non-Employee
Director of a Participant holding a Restricted Stock Award or Restricted Stock
Unit terminates due to Retirement, death or Disability, any remaining
Restricted Period with respect to Restricted Stock Awards or Restricted Stock
Units held by such Participant shall lapse as of the date of such termination.
5.03 PERFORMANCE AWARDS. Unless otherwise provided in the applicable
Agreement, if the status as an Employee and Non-Employee Director of a
Participant holding a Performance Award terminates for any reason other than
Retirement, death or Disability prior to satisfaction of the performance
requirements of such Award, such Award automatically shall be forfeited by the
Participant to the extent such requirements are not satisfied; provided,
however, that the Board, in its sole discretion, may waive or change the
remaining requirements or add additional requirements with respect to any
Performance Award or portion thereof that would otherwise be forfeited, as it
deems appropriate. Unless otherwise provided in the applicable Agreement, if
the status as an Employee and Non-Employee Director of a Participant holding a
Performance Award terminates due to Retirement, death or Disability, the
performance requirements of such Award shall be deemed to have been fully
satisfied.
5.04 OTHER PROVISIONS. Neither the transfer of a Participant from one
corporation or division to another corporation or division among the Company
and any of its Affiliates nor a leave of absence under the Company's leave
policy shall be deemed to constitute a termination of status as a Participant
for purposes of the Plan, except that no new awards or grants may be made to a
Participant during a leave of absence.
VI. ADJUSTMENTS AND CHANGE IN CONTROL
6.01 ADJUSTMENTS.
(a) If the Board shall determine that any dividend or other
distribution (whether in the form of cash, Common Stock, other securities, or
other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Common Stock or other securities of the Company,
issuance of warrants or other rights to purchase Common Stock or other
securities of the Company, or other corporate transaction or event affects the
Common Stock such that an adjustment is appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan, then the Board shall, in such manner as it may
deem equitable, adjust any or all of (1) the number and type of shares of
Common Stock which thereafter may be made the subject of Options, Restricted
Stock Awards, Restricted Stock Units and Performance Awards, (2) the number and
type of shares of Common Stock subject to outstanding Options, Restricted Stock
Awards, Restricted Stock Units and Performance Awards, and (3) the exercise
price with respect to any Option; provided, however, in each case, that with
respect to Incentive Stock Options any such adjustment shall be made in
accordance with Section 422 of the Code or any successor provision thereto to
the extent that such Option is intended to remain an Incentive Stock Option.
(b) The foregoing adjustments shall be made by the Board. Any
such adjustment shall provide for the elimination of any fractional share that
might otherwise become subject to an Option, Restricted Stock Award, Restricted
Stock Unit or Performance Award.
6.02 CHANGE IN CONTROL. Upon the occurrence of a Change in Control, or
if the Board determines in its sole discretion that a Change in Control has
occurred, then (a) any Option granted hereunder immediately shall become
exercisable in full, regardless of any installment provision applicable to such
Option; (b) any remaining Restricted Period on any shares of Common Stock
subject to a Restricted Stock Award or Restricted Stock Unit granted hereunder
immediately shall lapse; and (c) the performance requirements for a Performance
Award granted hereunder shall be deemed to have been satisfied in full.
6.03 MERGER. If the Company is a party to any merger, consolidation,
reorganization, or sale of substantially all of its assets, each holder of
outstanding Option, Restricted Stock Award, Restricted Stock Unit or
Performance Award, to the extent that such Option, Award or Unit remains
outstanding thereafter, shall be entitled to receive, in lieu of the shares of
Common Stock to which such holder would otherwise be entitled, upon the
exercise of such Option or the lapse of the Restricted Period on shares of
Common Stock subject to a Restricted Stock Award or Restricted Stock Unit or
the satisfaction of the performance requirements for a Performance Award, the
securities and/or property which a shareholder owning the number of shares
subject to the holder's Option, Restricted Stock Award, Restricted Stock Unit
or Performance Award would be entitled to receive pursuant to such merger,
consolidation, reorganization or sale of assets.
VII. MISCELLANEOUS
7.01 PARTIAL EXERCISE/FRACTIONAL SHARES. The Board may permit, and
shall establish procedures for, the partial exercise of Options granted under
the Plan. No fractional shares shall be issued in connection with the exercise
or payment of a grant or award under the Plan; instead, the Fair Market Value
of the fractional shares shall be paid in cash, or at the discretion of the
Board, the number of shares shall be rounded down to the nearest whole number
of shares, and any fractional shares shall be disregarded.
7.02 RULE 16B-3 REQUIREMENTS. Notwithstanding any other provision of
the Plan, the Board may impose such conditions on a Restricted Stock Award,
Restricted Stock Unit, Performance Award or the exercise of an Option
(including, without limitation, the right of the Committee to limit the time of
exercise to specified periods) as may be required to satisfy the requirements
of Rule 16b-3 of the Exchange Act (as such rule may be in effect at such time).
7.03 RIGHTS PRIOR TO ISSUANCE OF SHARES. No Participant shall have any
rights as a shareholder with respect to shares covered by an Option, Restricted
Stock Award, Restricted Stock Unit or Performance Award until the issuance of
such shares. No adjustment shall be made for dividends or other rights with
respect to such shares for which the record date is prior to the date the
shares are issued.
7.04 NON-ASSIGNABILITY. No Option, Restricted Stock Award, Restricted
Stock Unit or Performance Award shall be transferable by a Participant except
by will or the laws of descent and distribution. During the lifetime of a
Participant, an Incentive Stock Option shall be exercised only by the
Participant. No transfer of an Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and a copy of the
will or such evidence as the Company may deem necessary to establish the
validity of the transfer and the acceptance by the transferee of the terms and
conditions of the Option, Restricted Stock Grant Award, Restricted Stock Unit
or Performance Award.
7.05 SECURITIES LAWS.
(a) Anything to the contrary herein notwithstanding, the
Company's obligation to sell and deliver Common Stock pursuant to the exercise
of an Option, or deliver Common Stock pursuant to a Restricted Stock Award,
Restricted Stock Unit or Performance Award is subject to such compliance with
federal and state laws, rules and regulations applying to the authorization,
issuance or sale of securities as the Company deems necessary or advisable. The
Company shall not be required to sell or deliver Common Stock unless and until
it receives satisfactory assurance that the issuance or transfer of such shares
shall not violate any of the provisions of the Securities Act of 1933, the
Exchange Act, any other applicable federal laws, or the rules and regulations
of the Securities and Exchange Commission promulgated thereunder or those of
any stock exchange or stock market on which the Common Stock may be listed or
traded, the provisions of any state laws governing the sale of securities, or
that there has been compliance with the provisions of such acts, rules,
regulations and laws.
(b) The Board may impose such restrictions on any shares of
Common Stock subject to or underlying an Option, Restricted Stock Award,
Restricted Stock Unit or Performance Award as it may deem advisable, including,
without limitation, restrictions (i) under applicable federal securities laws,
(ii) under the requirements of any stock exchange or other recognized trading
market upon which such shares of Common Stock are then listed or traded, or
(iii) under any blue sky or state securities laws applicable to such shares. No
shares shall be issued until the Company has determined that the Company has
complied with all requirements under appropriate securities laws.
7.06 WITHHOLDING AND TAXES. The Company shall have the right to
withhold from a Participant's compensation or require a Participant to remit
sufficient funds to satisfy applicable withholding for income and employment
taxes upon the exercise of an Option, the lapse of a Restriction Period or the
satisfaction of the performance requirements relating to a Performance Award. A
Participant may tender previously acquired shares of Common Stock that have
been held at least six months to satisfy the withholding obligation in whole or
in part, such shares being valued for such purpose at Fair Market Value;
provided that the Company shall not withhold from exercise more shares than are
necessary to satisfy the established requirements of federal, state and local
tax withholding obligations.
7.07 TERMINATION AND AMENDMENT.
(a) The Board may terminate the Plan, or the granting of
Options, Restricted Stock Awards, Restricted Stock Units or Performance Awards
under the Plan, at any time. No new grants or awards shall be made under the
Plan after the tenth anniversary of the Effective Date.
(b) The Board may amend or modify the Plan at any time and
from time to time.
(c) No amendment, modification or termination of the Plan
shall adversely affect any Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award previously granted under the Plan in any material way
without the consent of the Participant holding the Option, Restricted Stock
Award, Restricted Stock Unit or Performance Award.
(d) An Agreement relating to an Option shall not be amended
to change the exercise price of the Option evidenced by such Agreement, other
than pursuant to Article VI.
7.08 EFFECT ON EMPLOYMENT OR SERVICES. Neither the adoption of the
Plan nor the granting of any Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award pursuant to the Plan shall be deemed to create any
right in any individual to be retained or continued in the employment or
services of the Company or an Affiliate.
7.09 USE OF PROCEEDS. The proceeds received from the sale of Common
Stock pursuant to the Plan shall be used for general corporate purposes of the
Company.
7.10 APPROVAL OF PLAN. The Plan has been subject to the approval of
the holders of at least a majority of the Common Stock of the Company present
and entitled to vote at a meeting of shareholders of the Company.
7.11 GOVERNING LAW. The Plan and all actions taken under the Plan
shall be governed and construed in accordance with Nevada law.
THIS PLAN is hereby adopted as of January 1, 2004 in accordance with
the Board resolutions adopted at the annual shareholder meeting.
DATASCENSION, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
Page 1 of 63
EXHIBIT B
RESTRICTED STOCK AWARD AGREEMENT
Page 1 of 63
RESTRICTED STOCK AGREEMENT
(EMPLOYEE VERSION)
THIS RESTRICTED STOCK AGREEMENT is made the 1st day of January 2004,
by and between Datascension Inc ("Company") and the undersigned ("Grantee"),
pursuant to the Datascension Inc Stock Compensation Plan ("Plan"). Capitalized
terms not defined in this Agreement shall have the meanings respectively
ascribed to them in the Plan.
WHEREAS, the Company desires to encourage the Grantee to make greater
efforts on behalf of the Company and its Affiliates to achieve the Company's
long-term business plans and objectives and to further identify the interests
of Grantee with the interests of the Company's shareholders;
WHEREAS, the Company desires to grant this restricted stock award to
the Grantee pursuant to the Plan, a copy of which is attached hereto;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is agreed between the parties
as follows:
1. GRANT OF RESTRICTED STOCK AWARD. Subject to the terms and
conditions hereof, including without limitation the restrictions set forth in
Section 2(a) of this Agreement, the Company hereby grants to the Grantee a
total of 250,000 shares of the Company's Common Stock as follows:
(i) The Company shall make an initial signing award to the Executive as of the
Effective Date of 100,000 restricted shares of the Company's common stock under
and subject to the terms and conditions of the Stock Compensation Plan (the
"Stock Plan")
(ii) The Company shall make an award to the Executive as on the Effective Date
of a spin off a subsidiary of 50,000 restricted shares of the Company's common
stock under and subject to the terms and conditions of the Stock Compensation
Plan (the "Stock Plan").
(iii)The Company shall make a further award to the Executive as on the
Effective Date of the spin off subsidiary trading on a recognized exchange of
100,000 restricted shares of the Company's common stock or 50,000 restricted
shares of the Company's common stock if traded on the OTCBB (Over the Counter
Bulletin Board), under and subject to the terms and conditions of the Stock
Compensation Plan (the "Stock Plan".
The foregoing awards of restricted stock shall be evidenced by a restricted
stock award agreement, which is attached hereto as Exhibit B and made a part of
this Agreement.
2. RESTRICTIONS ON TRANSFER OF SHARES SUBJECT TO AWARD.
(a) The shares under the awards shall not be transferred,
pledged, assigned, or otherwise alienated or hypothecated until the occurrence
of the events set forth in this Section 2, at which time such restrictions
shall lapse. Except as set forth below, the restrictions on such shares shall
lapse as follows, if the Grantee is still employed with the Company or an
Affiliate on such dates:
Percentage of Award
Period After Grant Date As to Which
Restrictions Lapse
----------------------- -----------
-------------------
90 days
50%
Six months
100%
Restrictions shall be deemed to lapse at the close of business on such date.
Notwithstanding the foregoing, the restrictions set forth above also shall
lapse as follows: (1) the restrictions set forth above shall immediately lapse
upon the Grantee's death or termination of employment due to Disability or
Retirement; (2) the restrictions set forth above shall immediately lapse upon a
Change in Control of the Company; (3) the restrictions set forth above shall
immediately lapse as to one-half of all outstanding unvested restricted stock
subject to this award in the event of a termination of employment by the
Company due to an Employment Order, as such term is defined in the Employment
Agreement between Company and Grantee dated January 1, 2004 ("Employment
Agreement") and whether or not that employment agreement is in effect when
employment terminates under this subsection, the remaining one-half of such
outstanding unvested restricted stock being forfeited, (4) the restrictions set
forth above shall immediately lapse upon the termination of the Grantee by the
Company for any reason other than Cause (including Constructive Discharge but
excluding termination due to an Employment Order) as such terms are defined in
the Employment Agreement, whether or not that employment agreement is in effect
when employment terminates under this subsection, or (5) action by the Board to
waive the remaining restricted period in its sole discretion. Upon the lapse of
such restrictions, the shares under the restricted stock award granted
hereunder shall be freely transferable. If the Grantee's employment with the
Company or its Affiliates terminates other than under the circumstances
described in the next preceding sentence, any portion of the restricted stock
award as to which such restrictions have not lapsed at the time of such
termination shall be forfeited.
(b) Until the lapse of all restrictions provided in Section 2(a) on
the shares subject to this restricted stock award, any certificate evidencing
the shares subject to the award shall carry the following restrictive legend:
The sale or other transfer of the shares of stock represented
by this certificate, whether voluntary, involuntary or by
operation of law, is subject to certain restrictions on
transfer set forth in the Datascension Inc Stock
Compensation Plan (the "Plan"), rules and administrative
guidelines adopted pursuant to such Plan and an Agreement
dated ___________, ___. A copy of the Plan, such rules and
such Agreement may be obtained from the Secretary of the
Company.
The Company shall also have the right to place stop transfer instructions on
shares which are subject to the restrictions described in Section 2(a). Grantee
shall be entitled to removal of such legend and stop transfer instructions at
the time or times provided by, and in accordance with, Section 3.05 of the
Plan.
3. NON-ASSIGNABILITY OF AWARD. The award hereby granted shall not be
transferable. No purported assignment or transfer of this award, or of the
rights represented thereby, whether voluntary or involuntary, by operation of
law or otherwise, shall vest in the purported assignee or transferee any
interest or right whatsoever. For the avoidance of doubt, the parties
acknowledge that this Section 3 applies to the award itself, not to the shares
subject to the award, and that the transferability of the shares subject to the
award shall be governed by Section 2 of this Agreement.
4. ADJUSTMENTS. In the event of any stock dividend, reclassification,
subdivision or combination, or similar transaction affecting the shares covered
by this award, the rights of the Grantee are subject to adjustment as provided
in Section 6.01 of the Plan to the extent deemed necessary by the Board.
5. RIGHTS AS SHAREHOLDER. Subject to the restrictions and risk of
forfeiture set forth in Section 2, the Grantee shall have all rights of a
shareholder (including voting and dividend rights) with respect to the shares
subject to the award commencing on the date on which the shares subject to the
award are issued.
6. WITHHOLDING. The Grantee authorizes the Company to withhold from
his or her compensation to satisfy any income and employment tax withholding
obligations in connection with the award. If the Grantee is no longer employed
by the Company at the time any applicable taxes are due and must be remitted by
the Company, the Grantee agrees to pay applicable taxes to the Company, and the
Company may delay removal of the restrictive legend until proper payment of
such taxes has been made by the Grantee. The Grantee may satisfy such
obligations under this Section 6 by any method authorized under Section 7.06 of
the Plan.
7. NOTICES. Every notice relating to this Agreement shall be in
writing and if given by mail shall be given by registered or certified mail
with return receipt requested. All notices to the Company shall be delivered to
the President of the Company at the Company's headquarters. All notices by the
Company to the Grantee shall be delivered to the Grantee personally or
addressed to the Grantee at the Grantee's last residence address as then
contained in the records of the Company or such other address as the Grantee
may designate. Either party by notice to the other may designate a different
address to which notices shall be addressed. Any notice given by the Company to
the Grantee at the Grantee's last designated address shall be effective to bind
any other person who shall acquire rights hereunder.
8. GOVERNING LAW. This Agreement (a) shall be governed by and
construed in accordance with the laws of the State of Nevada without giving
effect to conflict of laws, and (b) is not valid unless it has been manually
signed by the Grantee and the Company.
9. PROVISIONS OF PLAN CONTROLLING. The provisions hereof are subject
to the terms and provisions of the Plan. In the event of any conflict between
the provisions of this Agreement and the provisions of the Plan, the provisions
of the Plan shall control.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
GRANTEE DATASCENSION, INC
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------- -----------------------------------
Executive Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
Page 1 of 63
EXHIBIT C
NONQUALIFIED STOCK OPTION AGREEMENT
Page 1 of 63
NONQUALIFIED STOCK OPTION AGREEMENT
(EMPLOYEE VERSION)
THIS AGREEMENT is entered into as of January 1, 2004 ("Grant Date"),
by and between Datascension Inc ("Company") and the undersigned ("Optionee"),
pursuant to the Datascension Inc Stock Compensation Plan ("Plan"). The Company
hereby grants to the Optionee a Nonqualified Stock Option to purchase 540,000
shares of Common Stock, subject to the terms and conditions contained in the
Plan and as hereinafter provided (the "Option"). Capitalized terms not defined
in this Agreement shall have the meanings respectively ascribed to them in the
Plan.
1. EXERCISE PRICE. The Option shall be exercisable at $0.30 per share.
2. OPTION EXERCISE.
(a) Vesting. The Option shall become exercisable in full at the close of
business on the first anniversary of the Grant Date. Notwithstanding the
foregoing, the Option also shall become exercisable as follows: (1) the Option
shall become exercisable to the extent provided in the attached SCHEDULE A, if
the performance goals specified therein are met, (2) the Option shall become
exercisable in full upon a Change in Control of the Company (as defined in the
Change in Control Agreement between the Company and the Optionee dated January
1, 2004); (3) one-half of the Option shall become exercisable upon termination
of the Optionee by the Company due to an Employment Order, as such term is
defined in the Employment Agreement between Company and Optionee dated January
1, 2004 ("Employment Agreement"), whether or not that employment agreement is
in effect when employment terminates under this subsection, and (4) the Option
shall become exercisable in full upon termination of the Optionee by the
Company for any reason other than Cause (including Constructive Discharge but
excluding termination due to an Employment Order), as such terms are defined in
the Employment Agreement, whether or not that employment agreement is in effect
when employment terminates under this subsection.
If the Company is a party to any merger, consolidation, reorganization, or sale
of substantially all of its assets, Optionee shall, in connection with such
transaction, to the extent that the Option is not cancelled, cashed-out or
previously exercised, be entitled to receive upon exercise of the Option, in
lieu of shares of Common Stock to which the Optionee would otherwise be
entitled, the securities or property which a shareholder owning the number of
shares of Common Stock for which the Option is then exercisable would be
entitled to receive pursuant to such transaction. Any provision of this
Agreement to the contrary notwithstanding, the Option shall expire and no
longer be exercisable after close of business on the date which is the fifth
anniversary of the Grant Date (the "Expiration Date").
(b) Notice. The Option may be exercised only by delivery to the President of
the Company of a written and duly executed notice in the form attached hereto
accompanied by payment in the form or forms permitted by Section 2(c) below.
(c) Payment Terms. The purchase price for shares of Common Stock to be acquired
upon exercise of the Option shall be paid in full at the time of exercise (1)
in cash; (2) by personal check, bank draft or money order; (3) by tendering
shares of Common Stock that have been held at least six months and which are
freely owned and held by the Optionee independent of any restrictions,
hypothecations or other encumbrances, duly endorsed for transfer (or with duly
executed stock powers attached); or (4) any combination of the above.
3. TERMINATION OF EMPLOYMENT.
(a) If, prior to the date that the Option first becomes exercisable,
Optionee' s employment is terminated for any reason, Optionee's right to
exercise the Option shall terminate and all rights thereunder shall cease as of
the close of business on the date of such termination.
(b) If, on or after the date that the Option first becomes exercisable,
Optionee's employment is terminated (1) for Cause (as defined in the Employment
Agreement), any unexercised portion of the Option (whether then exercisable or
not) shall, as of the time of the Cause determination, immediately terminate,
(2) due to death or Disability, then the Option, to the extent that it is
exercisable on the date of termination, shall be exercisable only until the
earlier of the one year anniversary of such termination or the Expiration Date,
(3) due to Retirement, or if Optionee is a party to a Change in Control
Agreement with the Company (dated January 1, 2004) and Optionee's employment is
terminated involuntarily or constructively in accordance with paragraph 3
thereof, then the Option, to the extent that it is exercisable on the date of
termination, shall be exercisable until the Expiration Date, or (4) for any
other reason, then the Option, to the extent that it is exercisable on the date
of employment termination, shall be exercisable only until the earlier of the
thirty six month anniversary of such termination or the Expiration Date.
4. OPTIONEE'S AGREEMENT. The Optionee agrees to all the terms stated
in this Agreement, as well as to the terms of the Plan, a copy of which is
attached hereto and of which the Optionee acknowledges receipt. To the extent
any provision of this Agreement conflicts with the terms of the Plan, the terms
of the Plan shall control. Pursuant to the Plan, the Board is vested with
conclusive authority to administer the Plan (which includes, among other
things, the authority to determine the terms and conditions of this Agreement
and the Option).
5. WITHHOLDING. The Optionee consents to withholding from his or her
compensation of all applicable payroll and income taxes with respect to the
Option. If the Optionee is no longer employed by the Company at the time any
applicable taxes with respect to the Option are due and must be remitted by the
Company, the Optionee agrees to pay applicable taxes to the Company, and the
Company may delay issuance of a certificate until proper payment of such taxes
has been made by the Optionee. The Optionee may satisfy such obligations under
this Section 5 by any method authorized under Section 7.06 of the Plan.
6. RIGHTS AS SHAREHOLDER. The Optionee shall have no rights as a
shareholder of the Company with respect to any of the shares covered by the
Option until the issuance of such shares. No adjustment shall be made for
dividends or other rights with respect to such shares for which the record date
is prior to the date such shares are issued.
7. NON-TRANSFERABILITY OF OPTION. The Option shall not be transferred
in any manner other than by will, the laws of descent and distribution or any
other manner permitted by the Plan at the time of such purported transfer. No
transfer of the Option shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and such evidence
as the Company may deem necessary to establish the validity of the transfer and
the acceptance by the transferee of the terms and conditions of the Option.
8. ADJUSTMENTS. The number of shares of Common Stock to which the
Option is subject and the exercise price are subject to adjustment in
accordance with Section 6.01 of the Plan. Such adjustment will be determined by
the Committee, in its sole discretion.
9. NO RIGHT TO EMPLOYMENT. The granting of the Option does not confer
upon the Optionee any right to be retained as an Employee.
10. AMENDMENT AND TERMINATION OF OPTION. Except as otherwise provided
in this Agreement or in the Plan, the Company may not, without the consent of
the Optionee, amend, modify or terminate this Agreement if such amendment,
modification or termination would adversely affect the Option in any material
way.
11. NOTICES. Every notice relating to this Agreement shall be in
writing and if given by mail shall be given by registered or certified mail
with return receipt requested. All notices to the Company or the Board shall be
sent or delivered to the President of the Company at the Company's
headquarters. All notices by the Company to the Optionee shall be delivered to
the Optionee personally or addressed to the Optionee at the Optionee's last
residence address as then contained in the records of the Company or such other
address as the Optionee may designate. Either party by notice to the other may
designate a different address to which notices shall be addressed. Any notice
given by the Company to the Optionee at the Optionee's last designated address
shall be effective to bind any other person who shall acquire rights hereunder.
12. APPLICABLE LAW. This Agreement (a) shall be governed by and
construed in accordance with the laws of the State of Nevada without giving
effect to conflict of laws, and (b) is not valid unless it has been manually
signed by the Optionee and the Company.
IN WITNESS WHEREOF, this Agreement has been executed as of November 1,
2004, by the parties set forth below.
OPTIONEE: DATASCENSION, INC
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------- -----------------------------------
Executive Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
Page 1 of 63
NOTICE OF EXERCISE
President
Datascension, Inc
0000 XxXxxx Xxxxx, Xxxxx 0
Xxx Xxxxx, XX 00000
An Option was granted to me on ___________,____ to purchase_________
shares of Datascension Inc common stock at a price of $______per share (the
"Option"). I hereby elect to exercise the Option with respect
to_____________shares. Payment of the exercise price is being made as follows
(check all that apply):
- Cash delivered with this notice.
- Certified check, bank draft or money order delivered with
this
notice.
- I am tendering shares of Common Stock that I currently own. I
certify that I have owned such shares for at least the six
months prior to the date of this notice.
The stock certificate for the shares acquired upon exercise should be issued
to:
(name)
-------------------------------------
-
(address)
-------------------------------------
-
(Social Security No.)
-------------------------------------
-
Dated: , (signature)
--------------------------
-
(print name)
-------------------------
-
Page 1 of 63
DATASCENSION, INC
SCHEDULE A
OPTION GRANT
VESTING SCHEDULE*
------------------------------- ----------------------------
Annual Revenue % Vesting
------------------------------- ----------------------------
------------------------------- ----------------------------
$10,000,000 20%
------------------------------- ----------------------------
$12,500,000 40%
------------------------------- ----------------------------
$15,000,000 60%
------------------------------- ----------------------------
$17,500,000 80%
------------------------------- ----------------------------
$20,000,000 100%
------------------------------- ----------------------------
*The options will become 100% vested on the fifth (5th) anniversary of the five
year option grant, or earlier as outlined in the above Option vesting schedule
upon the revenue targets set forth therein being met. In determining vesting
under the above schedule, the "% vesting" shall be based upon the highest
rolling four quarter average revenue for Datascension, Inc for each consecutive
four quarter period completed. For this purpose, the highest attained revenue
shall be at the discretion of the Board of Directors.
If the Net Profit percentage for the Annual Revenue outlined in the above
Option vesting schedule is equal to, or greater than 10% annually, 25% of the
option granted will be received as an additional performance award by the
Executive and will not be required to be purchased by Executive.
Net Profit percentage will be defined as the net operating profit after all
deductions and expenses in the ordinary course of business and will exclude
extraordinary items.
Page 1 of 63
EXHIBIT D
MANAGEMENT INCENTIVE PLAN
Page 1 of 63
DATASCENSION INC.
MANAGEMENT INCENTIVE PLAN
I. PURPOSE:
1. Ensure achievement of strategic goals.
2. Strengthen links between pay and performance.
3. Align management more closely with shareholder.
II. ELIGIBILITY:
Senior Vice Presidents and above and certain other officers based upon
corporate responsibility who are not participants in another established
incentive plan with payment amounts determined by performance in relation to
goal. Awards will be pro-rated based on months served for staff members with
less than 12 months of service in a Plan Year. Staff members become eligible to
participate in the plan by virtue of promotion or new hire. A staff member who
terminates employment before the Plan Year is not eligible to receive an award.
III. PERFORMANCE MEASUREMENT FACTORS:
Individual bonus awards will be based on corporate and individual
performance.
- Upon reaching $10,000,000 in revenue, the factor will pay out at
20%.
- Upon reaching $12,500,000 in revenue, the factor will pay out at
40%.
- Upon reaching $15,000,000 in revenue, the factor will pay out at
60%.
- Upon reaching $17,500,000 in revenue, the factor will pay out at
80%.
- Upon reaching $20,000,000 in revenue, the factor will pay out at
100%.
- Achievement over 100% of plan will result in a factor pay out
multiplier prorated at 10% for every $1,000,000 by which revenue
exceeds the Plan Goal with a maximum pay out percent of 150%
For example:
-
PERCENT OF TARGET PAYOUT PERCENT REVENUE
FACTOR*
----------------- -------------- -----------
100% 100% 60%
101% 110% X 60%
102% 120% 60%
- Direct Contribution, Key Success Factors and Special Initiatives
should be achieved at 100% for pay out and may be multiplied by a
performance factor of 100% to 150% at the discretion of the Board
of Directors.
- Special initiatives are defined as producing revenue enhancement
or expense reduction.
Page 1 of 63
IV. AWARD LIMITATIONS:
No awards will be made unless the corporation meets or exceeds 96.5% of
the Revenue Goal.
V. AWARD PAYMENTS:
All awards earned under Management Incentive Plan will be paid as soon as
practical following approval by the Board of Directors.
VI. ADDITIONAL PROVISIONS:
The Management Incentive Plan shall be administered by the Board of
Directors of the Corporation.
Participation in the Management Incentive Plan shall not be construed as
giving any employee the right to continued employment with the corporation for
the full or for any subsequent period.
VII. DISCRETIONARY GUIDELINES:
OBJECTIVES: Recognize and promote exemplary individual performance or
initiative.
GUIDELINES: Discretionary awards should be given in recognition for one or
more of the following performance criteria:
Earnings:
- Expense reduction
- Revenue enhancement
Innovation:
- Continuous improvement efforts
- Innovative delivery alternatives
- Foresight and planning to prevent crises
Achievement:
- Unique/specialized skills or knowledge of value to the
company, i.e., Key Performers
- Sustained high performance
- Exemplary performance during unusual circumstances or
specific events
- Special projects completed in an exceptional manner or
ahead of schedule
Page 1 of 63
EXHIBIT E
CHANGE IN CONTROL AGREEMENT
Page 1 of 63
CHANGE IN CONTROL AGREEMENT
This Change in Control Agreement ("Agreement") is made by and between
Datascension Inc, a Nevada corporation ("Corporation"), and Xxxxx X. Xxxxxx
("Executive") and is entered into as of January 1, 2004.
The Corporation anticipates the valuable services that the Executive
will render on behalf of the Corporation and its subsidiaries and is desirous
of having some assurance that the Executive will continue as an employee and
that, in the event of a possible Change in Control of the Corporation, the
Executive will be able to perform his duties without undue concern for the
Executive's personal financial well-being; and
The Executive is willing to serve as an employee of the Corporation
but desires assurance that in the event of a Change in Control of the
Corporation, he will continue to have the responsibility and status he has
earned.
Accordingly, the Corporation and the Executive agree as follows:
1. In order to protect the Executive against the possible consequences
of a Change in Control of the Corporation, as defined in paragraph 2 of this
Agreement, and thereby to induce the Executive to serve as an officer of the
Corporation or a subsidiary the Corporation agrees that if (a) there is such a
Change in Control of the Corporation and (b) the Executive's employment with
the Corporation or a subsidiary company is terminated under the circumstances
described in paragraph 3 of this Agreement, then:
A. The Corporation shall pay the Executive a lump sum amount in cash
equal to the sum of (i) two times the Executive's annual base salary
immediately prior to the Change in Control (or if higher, the annual base
salary on the date the Executive's employment is terminated) and (ii) two times
the greater of (x) the anticipated bonus amount under the Datascension Inc
Management Incentive Plan to be earned in accordance with the plan in the year
in which the termination occurs or (y) the highest bonus paid to the Executive
in the last three full calendar years of such employment. The applicable amount
shall be payable within 60 days following the date of the Executive's
termination of employment.
B. The Executive shall continue to be covered, at the Corporation's
cost, by the medical, dental and vision insurance benefit plans that are in
effect on the date of his termination and that cover executive employees, for a
period of eighteen (18) months after his termination of employment; provided,
however, that if during such time period the Executive should enter into other
employment providing comparable benefits, his participation in such plans of
the Corporation shall cease to the extent of his coverage by his new employer's
plans. Any such non-cash benefit that is tied to compensation shall be based on
the Executive's annual compensation averaged over the same period as applicable
under paragraph A of this Agreement.
C. If the Executive has been furnished with an automobile for business
or personal use at the Corporation's expense within the previous 12 months
prior to the Change in Control, then the Corporation shall offer that
automobile (or one of comparable value) for sale to the Executive at a price
equal to the residual lease value or so-called "book value" in the case of a
vehicle owned by the Corporation.
D. All stock options and restricted stock previously granted by the
Corporation to the Executive, whether or not then exercisable, shall become
immediately vested and exercisable.
E. For a period of one year following termination of the Executive's
employment, the Executive shall be entitled to outplacement services provided
by an outplacement service provider designated by the Corporation. The cost of
providing the outplacement services shall be borne solely by the Corporation.
F. If the payment of any of the foregoing amounts or benefits (when
added to any other payments or benefits provided to the Executive in the nature
of compensation) will result in the payment of an excess parachute payment as
that term is defined in Section 280G of the Internal Revenue Code of 1986
("Code"), then in such event, the Corporation shall pay the Executive an
additional amount for each calendar year in which an excess parachute payment
is received by the Executive (the "Gross-Up Payment"). The Gross-Up Payment is
intended to cover the Executive's liability for any parachute tax under Code
Section 4999 on such excess parachute payment, as well as federal and state
income taxes and parachute tax on the additional amount, and shall be computed
as follows:
A=Pt/(1 - T - t), where -
A is the additional amount for any calendar year;
P is the amount of the excess parachute payment for
the
calendar year in excess of the allocable base amount
as defined in Code Section 28OG(b)(3);
T is the effective marginal rate of federal and state
income tax applicable to the Executive for the
calendar year; and
T is the rate of parachute tax under Code Section
4999.
The effective marginal rate of federal and state income tax
shall be computed as follows:
T = F + S(l - 0.8F) + m, where -
F is the highest marginal rate of federal income tax
applicable to the Executive for the calendar year;
and
S is the highest aggregate marginal rate of state
income tax applicable to the Executive for the
calendar year in the state or states and
municipalities to which he is then required to pay
income taxes as a result of his employment by the
Corporation; and
m is the employee's portion of the Medicare tax,
currently 1.45%.
Payment of the Gross-Up Payment shall be made to the
Executive on or before December 31 of each calendar year for which an excess
parachute payment is received by the Executive.
G. Subject to the provisions of paragraph G, all determinations
required to be made under these paragraphs E, F and G, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by Ernst & Young, LLP or such other certified public accounting firm reasonably
acceptable to the Corporation as may be designated by the Executive (the
"Accounting Firm") which shall provide detailed supporting calculations both to
the Corporation and the Executive within 15 business days of the receipt of
notice from the Executive that there has been an excess parachute payment, or
such earlier time as is requested by the Corporation. All fees and expenses of
the Accounting Firm shall be borne solely by the Corporation. Any determination
by the Accounting Firm shall be binding upon the Corporation and the Executive.
As a result of the uncertainty in the application of Section 4999 of the Code
at the time of the initial determination by the Accounting Firm hereunder, it
is possible that Gross-Up Payments which will not have been made by the
Corporation should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that the Corporation
exhausts its remedies pursuant to paragraph G and the Executive thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Corporation to or for the benefit of
the Executive.
H. The Executive shall notify the Corporation in writing of any claim
by the Internal Revenue Service that, if successful, would require the payment
by the Corporation of the Gross-Up Payment. Such notification shall be given as
soon as practicable but no later than ten business days after the Executive is
informed in writing of such claim and shall apprise the Corporation of the
nature of such claim and the date on which such claim is requested to be paid.
The Executive shall not pay such claim prior to the expiration of the 30-day
period following the date on which it gives such notice to the Corporation (or
such shorter period ending on the date that any payment of taxes with respect
to such claim is due). If the Corporation notifies the Executive in writing
prior to the expiration of such period that it desires to contest such claim,
the Executive shall: (i) give the Corporation any information reasonably
requested by the Corporation relating to such claim, (ii) take such action in
connection with contesting such claim as the Corporation shall reasonably
request in writing from time to time, including, without limitation, accepting
legal representation with respect to such claim by an attorney reasonably
selected by the Corporation, (iii) cooperate with the Corporation in good faith
in order effectively to contest such claim, and (iv) permit the Corporation to
participate in any proceedings relating to such claim; provided, however, that
the Corporation shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any
Excise Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of costs and
expenses. Without limitation on the foregoing provisions of this subparagraph
H, the Corporation shall control all proceedings taken in connection with such
contest and, at its sole option, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option, either direct the Executive
to pay the tax claimed and xxx for a refund or contest the claim in any
permissible manner, and the Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Corporation shall
determine; provided, however, that if the Corporation directs the Executive to
pay such claim and xxx for a refund, the Corporation shall advance the amount
of such payment to the Executive, on an interest-free basis, and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
Excise Tax and income tax (including interest or penalties with respect
thereto) imposed with respect to such advance or with respect to any imputed
income with respect to such advance calculated as described in subparagraph F
of this section; and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Corporation's control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority. If, after the receipt by the Executive
of an amount advanced by the Corporation pursuant to this subparagraph H, the
Executive becomes entitled to receive any refund with respect to such claim,
the Executive shall (subject to the Corporation's complying with the
requirements of this subparagraph H) promptly pay to the Corporation the amount
of such refund (together with any interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the Executive of an amount
advanced by the Corporation pursuant to this subparagraph H, a determination is
made that the Executive shall not be entitled to any refund with respect to
such claim and the Corporation does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the
extent thereof, the amount of Gross-Up Payment required to be paid.
2. For purposes of this Agreement, a "Change in Control" shall mean:
A. The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
the meaning of Rule l3d-3 promulgated under the Exchange Act) of 20% or more of
either (1) the then outstanding shares of common stock of the Corporation (the
"Outstanding Corporation Common Stock") or (2) the combined voting power of the
then outstanding voting securities of the Corporation entitled to vote
generally in the election of directors (the "Outstanding Corporation Voting
Securities"); provided, however, that for purposes of this subparagraph A, the
following acquisitions shall not constitute a Change in Control: (i) any
acquisition directly from the Corporation, (H) any acquisition by the
Corporation, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Corporation or any corporation controlled
by the Corporation, or.(iv) any acquisition by any corporation pursuant to a
transaction which complies with clauses (1), (2) and (3) of subparagraph C of
this paragraph 2; or
B. Individuals who, as of the date hereof, constitute the Board of
Directors of the Corporation (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board of Directors; provided, however,
that any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Corporation's shareholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board (either by a specific vote or by approval of the proxy
statement of the Corporation in which such person is named as a nominee for
director, without written objection to such nomination) shall be considered as
though such individual were a member of the Incumbent Board, but excluding, for
this purpose, any such individual whose initial assumption of office occurs as
a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of
proxies or contests by or on behalf of a person other than the Board of
Directors of the
Corporation; or
C. Consummation of a reorganization, merger, share exchange or
consolidation or sale of other disposition of all or substantially all of the
assets of the Corporation (a "Business Combination"), in each case, unless,
following such Business Combination: (1) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Corporation Common Stock and Outstanding Corporation Voting
Securities immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 65% of, respectively, the then outstanding
shares of common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a result of such
transaction owns the Corporation or all or substantially all of the
Corporation's assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination of the Outstanding Corporation Common Stock and
Outstanding Corporation Voting Securities, as the case may be; (2) no Person
(excluding any corporation resulting from such Business Combination or any
employee benefit plan (or related trust) of the Corporation or such corporation
resulting from the Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination; and (3) at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination were
members of the Incumbent Board immediately prior to the time of the execution
of the initial agreement, or of the action of the Board of Directors of the
Corporation, providing for such Business Combination; or
D. Approval by the stockholders of the Corporation of a complete
liquidation or dissolution of the Corporation.
3. Termination of the Executive's employment shall mean the
Executive's termination of employment at any time within 3 months prior to, on
the date of, or within 24 months after a Change in Control of the Corporation
as defined in paragraph 2 of this Agreement either by (a) involuntary dismissal
by the Corporation; or (b) the Executive's Constructive Discharge as defined in
(and subject to the procedures described therein) Section 5(d) of the
Employment Agreement.
4. The specific arrangements referred to above are not intended to
exclude the Executive's participation in other benefits available to executive
personnel of the Corporation generally or to preclude other compensation or
benefits as may be authorized by the Corporation's Board of Directors from time
to time.
5. As partial consideration for the above, the Executive agrees not to
disclose any confidential information about the Corporation and its operation
to which the Executive was privy during the course of his employment by the
Corporation. Further, the Executive agrees not to accept employment or consult
for or otherwise assist any competitor of the Corporation for a period of 24
months following his termination of employment. For purposes of the foregoing,
"competitor" means any financial institution that conducts business from any
location within 50 miles of any location at which the Corporation or any
subsidiary bank had an office on the day immediately prior to the day on which
the Change of Control of the Corporation occurred.
6. This Agreement shall be binding upon and shall inure to the benefit
of the respective successors, assigns, legal representatives and heirs to the
parties.
7. Any payment or delivery required under this agreement shall be
subject to all requirements of the law with regard to withholding, filing,
making of reports and the like, and the Corporation shall use its best efforts
to satisfy promptly all such requirements.
8. Notwithstanding anything contained herein to the contrary, this
Agreement shall be terminated and no benefits to the Executive shall be payable
if, at any time, the Executive shall resign voluntarily (other than as provided
in Section 3) , retire at or after normal retirement age, become incapacitated,
voluntarily take another position requiring a substantial portion of his time,
or die. This Agreement also shall terminate upon termination for cause of the
Executive's employment as an officer of the Corporation or any subsidiary bank
by the Incumbent Board. For purposes of the foregoing, "Cause" has the meaning
given in the Employment Agreement between the Corporation and Executive
effective January 1, 2004.
9. Any and all disputes, controversies or claims arising out of or in
connection with or relating to this Agreement or any breach or alleged breach
thereof shall, upon the request of either party, be submitted to and settled by
arbitration in the State of Nevada pursuant to the Voluntary Labor Arbitration
Rules, then in effect, of the American Arbitration Association (or at any other
place or under any other form of arbitration mutually acceptable to the parties
involved). The parties hereto specifically agree to arbitrate with the other
party in a proceeding with regard to all issues and disputes, and to permit
pre-hearing discovery in the time and manner provided by the then applicable
Federal Rules of Civil Procedure. This agreement to arbitrate shall be
specifically enforceable under the prevailing arbitration law. Notice of the
demand for arbitration shall be filed, in writing, with the other party to this
Agreement and with the American Arbitration Association. The demand for
arbitration shall be made within a reasonable time after the claim, dispute, or
other matter in question arose where the party asserting the claim should
reasonably have been aware of the same, but in no event later than the
applicable Nevada or federal statute of limitations. The arbitrator shall have
no power to add to, subtract from, or alter the terms of this Agreement, and
shall render a written decision setting forth findings and conclusions only as
to the claims or disputes at issue. Any award by the arbitrator shall be final
and conclusive upon the parties, and a judgment thereon may be entered in the
highest court for the forum, state or federal, having jurisdiction. All
expenses of the arbitration process shall be borne by the Corporation. The
Corporation shall reimburse the Executive for the reasonable fees of legal
counsel as incurred in connection with arbitrating the enforcement of any of
the Executive's rights under this Agreement. However, in no event shall the
Executive be entitled to retain any fees so reimbursed if the claim brought by
the Executive against the Corporation is in the arbitrator's sole determination
frivolous or was brought in bad faith, and the Corporation will be entitled to
seek repayment from the Executive for such fees after such determination by the
arbitrator.
10. The invalidity or unenforceability of any provision of this
Agreement shall not affect the enforceability or validity of any other
provision hereof.
11. This Agreement constitutes the entire agreement of the parties
with respect to the subject matter addressed in this Agreement. This Agreement
may be amended only in a written document signed by both the Corporation and
the Executive.
12. This Agreement shall be governed by the laws of the State of
Nevada. This Agreement has been executed by the parties on November 1, 2004.
EXECUTIVE DATASCENSION, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------- -----------------------------------
Executive Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
Page 1 of 63
EXHIBIT F
INDEMNIFICATION AGREEMENT
Page 1 of 63
DIRECTOR INDEMNIFICATION AGREEMENT
This Indemnification Agreement (the "Agreement") is made as of the 1st
day of January, 2004, by and between DATASCENSION, INC, a holding company
organized under the laws of the State of Nevada (the Company"), and Xxxxx X.
Xxxxxx (the "Director").
W I T N E S S E T H
WHEREAS, it is essential to the Company to retain and attract as
directors the most capable persons available; and
WHEREAS, the substantial increase in corporate litigation subjects
directors to expensive litigation risks; and
WHEREAS, it is reasonable, prudent and necessary for the Company to
contractually obligate itself to indemnify directors to the fullest extent
permitted by the Nevada Statutes so that capable persons will serve or continue
to serve the Company; and
WHEREAS, the Director is willing to serve, continue to serve and to
take on additional service for or on behalf of the Company on the condition
that the Director be so indemnified.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, the Company and the Director do hereby agree as follows:
1. Definitions. The following terms as used in this Agreement shall
have the following respective meanings:
"Expenses" means all expenses, liabilities and losses, including
attorneys' fees, judgments, fines, and amounts paid or to be paid in settlement
of a Proceeding.
"Proceeding" means any action, suit or proceeding (or part thereof),
whether civil, criminal, administrative or investigative.
2. Services by Director. The Director agrees to serve as a director of
the Company for so long as the Director is duly elected or appointed or until
the tender of the Director's written resignation.
3. Indemnification. Subject to the terms and conditions of this
Agreement, the Company shall indemnify and hold harmless the Director to the
fullest extent authorized by the Nevada Revised Statutes, as the same exists or
may hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Company to provide broader
indemnification rights than said law permitted the Company to provide prior to
such change), against all Expenses reasonably incurred or suffered by the
Director in connection with any Proceeding in which the Director is or was a
party or is threatened to be made a party or is involved by reason of the fact
that the Director is or was a director, officer or employee of the Company or
is or was serving at the request of the Company as a director, officer,
partner, trustee, administrator, employee or agent of another corporation or of
a partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of the Proceeding is
alleged action in an official capacity as a director, officer, partner,
trustee, administrator, employee or agent or in any other capacity while
serving as a director, officer, partner, trustee, administrator, employee or
agent; provided however, that, except as provided in Section 5 hereof with
respect to Proceedings to enforce rights to indemnification, the Company shall
indemnify the Director seeking indemnification in connection with a Proceeding
(or part thereof) initiated by the Director only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Company.
4. Expenses. The right to indemnification conferred under Section 3
hereof shall include the right to be paid by the Company Expenses incurred in
defending any such Proceeding in advance of its final disposition; provided
however, that the payment of such Expenses incurred by the Director in advance
of the final disposition of a Proceeding shall be made only upon (i) delivery
to the Company of (A) a written affirmation by the Director of the Director's
good faith belief that the Director has met the standard of conduct set forth
in Section 561 of the Nevada Business Corporation Act, and (B) an undertaking,
by or on behalf of the Director, to repay all advances if it shall ultimately
be determined by final judicial decision that the Director did not meet such
standard of conduct and (ii) a determination that the facts then known to those
making the determination to advance payment of such Expenses would not preclude
indemnification under the Nevada Business Corporation Act.
5. Right of the Director to Bring Suit. (a) If a claim under Section 3
hereof is not paid in full by the Company within thirty (30) days after notice
to the Company as provided in Section 10 hereof, the Director may at any time
thereafter bring suit against the Company in any court of competent
jurisdiction to recover the unpaid amount of the claim, and if successful in
whole or in part, the Director shall be entitled to be paid also the expense of
prosecuting such claim.
(b) It shall be a defense to any such action seeking indemnification
under Section 3 hereof (other than an action brought to enforce a claim for
Expenses incurred in defending any Proceeding in advance of its final
disposition where the required affirmation and undertaking have been tendered
to the Company in accordance with Section 4 hereof) that the Director has not
met the applicable standard of conduct set forth in the Nevada Business
Corporation Act. Further, in any action brought by the Company to recover
advances the Company shall be entitled to recover such advances if the Director
has not met the applicable standard of conduct set forth in the Nevada Business
Corporation Act. Neither the failure of the Company (including its Board of
Directors, independent legal counsel, or its shareholders) to have made a
determination prior to the commencement of such action that indemnification of
the Director is proper in the circumstances because the Director has met the
applicable standard of conduct set forth in the Nevada Business Corporation
Act, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its shareholders) that the Director
has not met such applicable standard of conduct, shall be a defense to an
action brought by the Director or create a presumption that the Director has
not met the applicable standard of conduct. In any action brought by the
Director to enforce a right hereunder, or by the Company to recover payments by
the Company of advances, the burden of proof shall be on the Company.
6. Assumption of Claim. The Company shall be entitled, but not
obligated, to assume the defense of any Proceeding with respect to which
indemnification is sought, with counsel satisfactory to the Director, upon the
delivery to the Director of written notice of the Company's election to do so.
After delivery of such notice, the Company will not be liable to the Director
under this Agreement for any expenses (including legal expenses) subsequently
incurred by the Director in defending such Proceeding; provided however, that
the Director shall have the right to employ his or her own counsel in any
Proceeding but the fees and expenses of such counsel incurred after delivery of
notice from the Company of its assumption of such defense shall be at the
Director's expense; and provided however that if (i) the employment of such
counsel by the Director has been previously authorized by the Company, (ii) the
Director shall have reasonably concluded that there may be a conflict of
interest between the Company and the Director in the conduct of any such
defense or (iii) the Company shall not, in fact, have employed counsel to
assume the defense of such action, the fees and expenses of such counsel shall
be at the expense of the Company.
7. Establishment of Trust. In the event of a Potential Change in
Control of the Company, as hereinafter defined, the Company shall, upon written
request by the Director, create a trust for the benefit of the Director and
from time to time upon written request of the Director shall fund such trust in
an amount sufficient to satisfy any and all Expenses that may properly be
subject to indemnification under Section 3 above anticipated at the time of
each such request. The amount or amounts to be deposited in the trust pursuant
to this funding obligation shall be determined by a majority vote of a quorum
consisting of directors who are not parties to such Proceeding, if any, the
executive committee of the Board of Directors or the President of the
Corporation. If all such individuals are parties to the Proceeding, if any, the
amount or amounts to be deposited in the trust shall be determined by
independent legal counsel. The terms of the trust shall provide that upon a
Change in Control (i) the trust shall not be revoked or the principal thereof
invaded, without the written consent of the Director; (ii) the trustee shall
advance, within two (2) business days of a request by the Director, any amount
properly payable to the director under Section 3 of this Agreement; (iii) the
trust shall continue to be funded by the Company in accordance with the funding
obligation set forth above; (iv) the trustee shall promptly pay to the Director
all amounts for which the Director shall be entitled to indemnification
pursuant to this Agreement or otherwise; and (v) all expended funds in such
trust shall revert to the Company upon a final determination by a court of
competent jurisdiction that the Director has been fully indemnified under the
terms of this Agreement. The trustee shall be chosen by the Director and shall
be a national or state chartered commercial bank. Nothing in this Section shall
relieve the Company of any of its obligations under this Agreement. At the time
of each draw from the trust fund, the Director shall provide the trustee with a
written request providing that the Director undertakes to repay such amount to
the extent that it is ultimately determined that the Director is not entitled
to such indemnification. Any funds, including interest or investment earnings
thereon, remaining in the trust shall revert and be paid to the Company if (i)
a Change in Control has not occurred and (ii) the Board of Directors, the
executive committee of the Board of Directors or the President of the Company
determines that the circumstances giving rise to that particular funding of the
trust no longer exists.
For purposes of this Section and Section 9 hereof, a "Change in
Control" shall mean a change in control of a nature that would be required to
be reported in response to Item 6(e) of Schedule 14A of Regulation 14a
promulgated under the Securities Exchange Act of 1934, as amended, provided
that, without limitation, such a change in control shall be deemed to have
occurred if (i) during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board of Directors of the Company
and any new director whose election by the Board of Directors or nomination for
election by the Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either were directors at
the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof;
(ii) the shareholders of the Company approve a merger or consolidation of the
Company with any other corporation, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least 80% of
the total voting power represented by the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation; or (iii) the shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company's assets.
For purposes of this Section, a "Potential Change in Control" shall be
deemed to have occurred if (i) the Company enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control;
(ii) any person (including the Company) publicly announces an intention to take
or to consider taking actions which once consummated would constitute a Change
in Control; or (iii) the Board of Directors adopts a resolution to the effect
that, for purposes of this Agreement, a Potential Change in Control has
occurred.
8. Non-Exclusivity of Rights. The rights provided hereunder shall not
be deemed exclusive of any other rights which the Director may be entitled
under any statute, agreement, provision of the Articles of Incorporation or
Bylaws of the Company, vote of shareholders or disinterested directors of the
Company, or otherwise, and such rights shall continue after the Director ceases
to serve the Company as a director.
9. Settlement. Unless and until a Change in Control has occurred, the
Company shall have no obligation to indemnify the Director under this Agreement
for any amounts paid in settlement of any Proceeding effected without the
Company's prior written consent. The Company shall not settle any claim in any
manner which would impose any obligation on the Director without the Director's
written consent. Neither the Company nor the Director shall unreasonably
withhold their consent to any proposed settlement.
10. Notice of Claim. The Director, as a condition precedent to his
right to be indemnified under this Agreement, shall give to the Company notice
in writing as soon as practicable of any claim made against him for which
indemnity will or could be sought under the Agreement. Notice to the Company
shall be directed to DATASCENSION INC, Attention: President (or such other
address as the Company shall designate in writing to the Director). Notice
shall be deemed received if sent by prepaid mail properly addressed, the date
of such notice being the date postmarked. In addition, the Director shall give
the Company such information and cooperation as it may reasonably request.
11. Severability. In the event that any provision of this Agreement is
determined by a court to require the Company to do or to fail to do an act
which is in violation of applicable law, such provision shall be limited or
modified in its application to the minimum extent necessary to avoid a
violation of law, and, as so limited or modified, such provision and the
balance of this Agreement shall be enforceable in accordance with their terms.
12. Choice of Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Nevada.
13. Successors and Assigns. This Agreement shall be (i) binding upon
all successors and assigns of the Company (including any transferee of all or
substantially all of its assets and any successor by merger or otherwise by
operation of law) and (ii) shall be binding on and inure to the benefit of the
heirs, personal representatives, executors and administrators of the Director.
14. Amendment. No amendment, modification, termination or cancellation
of this Agreement shall be effective unless made in writing and signed by each
of the parties hereto.
Page 1 of 63
IN WITNESS WHEREOF, the Company and the Director have executed this Agreement
as of the day and year first above written.
DIRECTOR DATASCENSION, INC
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------- -----------------------------------
Executive Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
Page 1 of 63
EXHIBIT G
DATASCENSION INTERNATIONAL STOCK COMPENSATION PLAN
Page 1 of 63
DATASCENSION INTERNATIONAL, INC.
STOCK COMPENSATION PLAN
EFFECTIVE NOVEMBER 1, 2004
I. GENERAL PROVISIONS
1.01 PURPOSE. The Plan, which was adopted by Datascension, Inc's Board on
the Effective Date, is intended to attract and retain highly competent,
effective and loyal Employees and Non-Employee Directors so as to further the
growth and profitable operation of the Company and its Affiliates by
encouraging Employees and Non-Employee Directors of the Company and its
Affiliates to be rewarded and acquire an ownership interest in the Company
through Options, Restricted Stock Awards, Restricted Stock Units and
Performance Awards, thus identifying their interests with those of shareholders
and encouraging them to make greater efforts on behalf of the Company and its
Affiliates to achieve the Company's long-term business plans and objectives.
1.02 STOCK. The total number of shares of Company Common Stock available
for grants and awards under this Plan shall be 405,800;
1.03 Restricted Stock Award. The Company shall make an award to the
Executive as of the Effective Date of 137,400 restricted shares of the
Company's common stock. foregoing award of restricted stock shall be evidenced
by a restricted stock award agreement, which is attached hereto as Exhibit H
and made a part of this Agreement.
II. RESTRICTED STOCK AWARDS AND UNITS
2.01 TERMS OF RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNITS. The
Board shall have the authority to grant Restricted Stock Awards and Restricted
Stock Units to such Participants and for such number of shares of Common Stock
as it shall designate. Such Awards and Units shall be evidenced by an Agreement
that shall specify the terms thereof, including the Restricted Period, the
number of shares of Common Stock subject to the Award or Unit, and such other
provisions, which may include, among other things, vesting and performance
goals, as the Board shall determine.
2.02 OTHER RESTRICTIONS. The Board shall impose such other restrictions
on any shares of Common Stock subject to a Restricted Stock Award or Restricted
Stock Unit as it may deem advisable including, without limitation, restrictions
under applicable federal or state securities laws, and shall legend any
certificates representing such shares to give appropriate notice of such
restrictions.
2.03 CERTIFICATE LEGEND. In addition to any legends placed on
certificates pursuant to Section 2.02, any certificate representing shares of
Common Stock subject to a Restricted Stock Award or Restricted Stock Unit shall
bear the following legend:
The sale or other transfer of the shares of stock represented by this
certificate, whether voluntary, involuntary or by operation of law, is
subject to certain restrictions on transfer set forth in the
Datascension Inc., Stock Compensation Plan (the "Plan"), rules and
administrative guidelines adopted pursuant to such Plan and an
Agreement dated ___________,____. A copy of the Plan, such rules and
such
Agreement may be obtained from the Secretary of the Company.
2.04 REMOVAL OF RESTRICTIONS. Except as otherwise provided under the Plan,
if the Restricted Period has elapsed or been waived by the Board with respect
to all or a portion of the Restricted Shares represented by a certificate, the
holder thereof shall be entitled to have the legend required by Section 2.03
removed from such stock certificate with respect to the shares as to which the
Restricted Period has elapsed. Any certificate evidencing the remaining shares
shall bear the legend required by Section 2.03. The Board shall have the
discretion to waive the applicable Restricted Period with respect to all or any
part of the Common Stock subject to a Restricted Stock Award or Restricted
Stock Unit. The Company shall have the right to retain any certificate
representing shares of Common Stock subject to a Restricted Stock Award or
Restricted Stock Unit until such time as all conditions and/or restrictions
applicable to such shares of Common Stock have been satisfied.
2.05 VOTING AND DIVIDEND RIGHTS. During the Restricted Period,
Participants shall be considered record owners of any shares of Common Stock
subject to any Restricted Stock Award or Restricted Stock Unit held by them for
purposes of determining who is entitled to vote or receive dividends with
respect to such shares. If any dividends or distributions are paid in shares of
Common Stock during the Restricted Period, the dividend or other distribution
shares shall be subject to the same restrictions on transferability as the
shares of Common Stock with respect to which they were paid.
III. ADJUSTMENTS AND CHANGE IN CONTROL
3.01 ADJUSTMENTS.
(a) If the Board shall determine that any dividend or other
distribution (whether in the form of cash, Common Stock, other securities, or
other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Common Stock or other securities of the Company,
issuance of warrants or other rights to purchase Common Stock or other
securities of the Company, or other corporate transaction or event affects the
Common Stock such that an adjustment is appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan, then the Board shall, in such manner as it may
deem equitable, adjust any or all of (1) the number and type of shares of
Common Stock which thereafter may be made the subject of Options, Restricted
Stock Awards, Restricted Stock Units and Performance Awards, (2) the number and
type of shares of Common Stock subject to outstanding Options, Restricted Stock
Awards, Restricted Stock Units and Performance Awards, and (3) the exercise
price with respect to any Option; provided, however, in each case, that with
respect to Incentive Stock Options any such adjustment shall be made in
accordance with Section 422 of the Code or any successor provision thereto to
the extent that such Option is intended to remain an Incentive Stock Option.
(b) The foregoing adjustments shall be made by the Board. Any
such adjustment shall provide for the elimination of any fractional share that
might otherwise become subject to an Option, Restricted Stock Award, Restricted
Stock Unit or Performance Award.
3.02 CHANGE IN CONTROL. Upon the occurrence of a Change in Control, or
if the Board determines in its sole discretion that a Change in Control has
occurred, then (a) any Option granted hereunder immediately shall become
exercisable in full, regardless of any installment provision applicable to such
Option; (b) any remaining Restricted Period on any shares of Common Stock
subject to a Restricted Stock Award or Restricted Stock Unit granted hereunder
immediately shall lapse; and (c) the performance requirements for a Performance
Award granted hereunder shall be deemed to have been satisfied in full.
IV. MISCELLANEOUS
4.01 PARTIAL EXERCISE/FRACTIONAL SHARES. The Board may permit, and
shall establish procedures for, the partial exercise of Options granted under
the Plan. No fractional shares shall be issued in connection with the exercise
or payment of a grant or award under the Plan; instead, the Fair Market Value
of the fractional shares shall be paid in cash, or at the discretion of the
Board, the number of shares shall be rounded down to the nearest whole number
of shares, and any fractional shares shall be disregarded.
4.02 RULE 16B-3 REQUIREMENTS. Notwithstanding any other provision of
the Plan, the Board may impose such conditions on a Restricted Stock Award,
Restricted Stock Unit, Performance Award or the exercise of an Option
(including, without limitation, the right of the Committee to limit the time of
exercise to specified periods) as may be required to satisfy the requirements
of Rule 16b-3 of the Exchange Act (as such rule may be in effect at such time).
4.03 RIGHTS PRIOR TO ISSUANCE OF SHARES. No Participant shall have any
rights as a shareholder with respect to shares covered by an Option, Restricted
Stock Award, Restricted Stock Unit or Performance Award until the issuance of
such shares. No adjustment shall be made for dividends or other rights with
respect to such shares for which the record date is prior to the date the
shares are issued.
4.04 NON-ASSIGNABILITY. No Option, Restricted Stock Award, Restricted
Stock Unit or Performance Award shall be transferable by a Participant except
by will or the laws of descent and distribution. During the lifetime of a
Participant, an Incentive Stock Option shall be exercised only by the
Participant. No transfer of an Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and a copy of the
will or such evidence as the Company may deem necessary to establish the
validity of the transfer and the acceptance by the transferee of the terms and
conditions of the Option, Restricted Stock Grant Award, Restricted Stock Unit
or Performance Award.
4.05 SECURITIES LAWS.
(a) Anything to the contrary herein notwithstanding, the
Company's obligation to sell and deliver Common Stock pursuant to the exercise
of an Option, or deliver Common Stock pursuant to a Restricted Stock Award,
Restricted Stock Unit or Performance Award is subject to such compliance with
federal and state laws, rules and regulations applying to the authorization,
issuance or sale of securities as the Company deems necessary or advisable. The
Company shall not be required to sell or deliver Common Stock unless and until
it receives satisfactory assurance that the issuance or transfer of such shares
shall not violate any of the provisions of the Securities Act of 1933, the
Exchange Act, any other applicable federal laws, or the rules and regulations
of the Securities and Exchange Commission promulgated thereunder or those of
any stock exchange or stock market on which the Common Stock may be listed or
traded, the provisions of any state laws governing the sale of securities, or
that there has been compliance with the provisions of such acts, rules,
regulations and laws.
(b) The Board may impose such restrictions on any shares of
Common Stock subject to or underlying an Option, Restricted Stock Award,
Restricted Stock Unit or Performance Award as it may deem advisable, including,
without limitation, restrictions (i) under applicable federal securities laws,
(ii) under the requirements of any stock exchange or other recognized trading
market upon which such shares of Common Stock are then listed or traded, or
(iii) under any blue sky or state securities laws applicable to such shares. No
shares shall be issued until the Company has determined that the Company has
complied with all requirements under appropriate securities laws.
4.06 WITHHOLDING AND TAXES. The Company shall have the right to
withhold from a Participant's compensation or require a Participant to remit
sufficient funds to satisfy applicable withholding for income and employment
taxes upon the exercise of an Option, the lapse of a Restriction Period or the
satisfaction of the performance requirements relating to a Performance Award. A
Participant may tender previously acquired shares of Common Stock that have
been held at least six months to satisfy the withholding obligation in whole or
in part, such shares being valued for such purpose at Fair Market Value;
provided that the Company shall not withhold from exercise more shares than are
necessary to satisfy the established requirements of federal, state and local
tax withholding obligations.
4.07 TERMINATION AND AMENDMENT.
(a) The Board may terminate the Plan, or the granting of
Options, Restricted Stock Awards, Restricted Stock Units or Performance Awards
under the Plan, at any time. No new grants or awards shall be made under the
Plan after the tenth anniversary of the Effective Date.
(b) The Board may amend or modify the Plan at any time and
from time to time.
(c) No amendment, modification or termination of the Plan
shall adversely affect any Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award previously granted under the Plan in any material way
without the consent of the Participant holding the Option, Restricted Stock
Award, Restricted Stock Unit or Performance Award.
(d) An Agreement relating to an Option shall not be amended
to change the exercise price of the Option evidenced by such Agreement, other
than pursuant to Article VI.
4.08 EFFECT ON EMPLOYMENT OR SERVICES. Neither the adoption of the
Plan nor the granting of any Option, Restricted Stock Award, Restricted Stock
Unit or Performance Award pursuant to the Plan shall be deemed to create any
right in any individual to be retained or continued in the employment or
services of the Company or an Affiliate.
4.09 USE OF PROCEEDS. The proceeds received from the sale of Common
Stock pursuant to the Plan shall be used for general corporate purposes of the
Company.
4.10 APPROVAL OF PLAN. The Plan has been subject to the approval of
the holders of at least a majority of the Common Stock of the Company present
and entitled to vote at a meeting of shareholders of the Company.
4.11 GOVERNING LAW. The Plan and all actions taken under the Plan
shall be governed and construed in accordance with Nevada law.
THIS PLAN is hereby adopted as of November 1, 2004 in accordance with
the Board resolutions adopted at the annual shareholder meeting.
DATASCENSION, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
Page 1 of 63
EXHIBIT H
RESTRICTED STOCK AWARD AGREEMENT
Page 1 of 63
RESTRICTED STOCK AGREEMENT
(EMPLOYEE VERSION)
THIS RESTRICTED STOCK AGREEMENT is made the 1st day of November, 2004,
by and between Datascension International, Inc ("Company") and the undersigned
("Grantee"), pursuant to the Datascension International, Inc Stock Compensation
Plan ("Plan"). Capitalized terms not defined in this Agreement shall have the
meanings respectively ascribed to them in the Plan.
WHEREAS, the Company desires to encourage the Grantee to make greater
efforts on behalf of the Company and its Affiliates to achieve the Company's
long-term business plans and objectives and to further identify the interests
of Grantee with the interests of the Company's shareholders;
WHEREAS, the Company desires to grant this restricted stock award to
the Grantee pursuant to the Plan, a copy of which is attached hereto;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is agreed between the parties
as follows:
1. GRANT OF RESTRICTED STOCK AWARD. Subject to the terms and
conditions hereof, including without limitation the restrictions set forth in
Section 2(a) of this Agreement, the Company hereby grants to the Grantee a
total of 137,400 shares of the Company's Common Stock.
2. RESTRICTIONS ON TRANSFER OF SHARES SUBJECT TO AWARD.
(a) The shares under the award shall not be transferred,
pledged, assigned, or otherwise alienated or hypothecated until the occurrence
of the events set forth in this Section 2, at which time such restrictions
shall lapse. Except as set forth below, the restrictions on such shares shall
lapse as follows, if the Grantee is still employed with the Company or an
Affiliate on such dates:
Percentage of Award
Period After Grant Date As to Which
Restrictions Lapse
----------------------- -----------
-------------------
90 days
50%
6 months
75%
12 months
100%
Restrictions shall be deemed to lapse at the close of business on such date.
Notwithstanding the foregoing, the restrictions set forth above also shall
lapse as follows: (1) the restrictions set forth above shall immediately lapse
upon the Grantee's death or termination of employment due to Disability or
Retirement; (2) the restrictions set forth above shall immediately lapse upon a
Change in Control of the Company; (3) the restrictions set forth above shall
immediately lapse as to one-half of all outstanding unvested restricted stock
subject to this award in the event of a termination of employment by the
Company due to an Employment Order, as such term is defined in the Employment
Agreement between Datascension, Inc and Grantee dated January 1, 2004
("Employment Agreement") and whether or not that employment agreement is in
effect when employment terminates under this subsection, the remaining one-half
of such outstanding unvested restricted stock being forfeited, (4) the
restrictions set forth above shall immediately lapse upon the termination of
the Grantee by the Company for any reason other than Cause (including
Constructive Discharge but excluding termination due to an Employment Order) as
such terms are defined in the Employment Agreement, whether or not that
employment agreement is in effect when employment terminates under this
subsection, or (5) action by the Board to waive the remaining restricted period
in its sole discretion. Upon the lapse of such restrictions, the shares under
the restricted stock award granted hereunder shall be freely transferable. If
the Grantee's employment with the Company or its Affiliates terminates other
than under the circumstances described in the next preceding sentence, any
portion of the restricted stock award as to which such restrictions have not
lapsed at the time of such termination shall be forfeited.
(b) Until the lapse of all restrictions provided in Section 2(a) on
the shares subject to this restricted stock award, any certificate evidencing
the shares subject to the award shall carry the following restrictive legend:
The sale or other transfer of the shares of stock represented
by this certificate, whether voluntary, involuntary or by
operation of law, is subject to certain restrictions on
transfer set forth in the Datascension Inc Stock
Compensation Plan (the "Plan"), rules and administrative
guidelines adopted pursuant to such Plan and an Agreement
dated ___________, ___. A copy of the Plan, such rules and
such Agreement may be obtained from the Secretary of the
Company.
The Company shall also have the right to place stop transfer instructions on
shares which are subject to the restrictions described in Section 2(a). Grantee
shall be entitled to removal of such legend and stop transfer instructions at
the time or times provided by, and in accordance with, Section 2.04 of the
Plan.
3. NON-ASSIGNABILITY OF AWARD. The award hereby granted shall not be
transferable. No purported assignment or transfer of this award, or of the
rights represented thereby, whether voluntary or involuntary, by operation of
law or otherwise, shall vest in the purported assignee or transferee any
interest or right whatsoever. For the avoidance of doubt, the parties
acknowledge that this Section 3 applies to the award itself, not to the shares
subject to the award, and that the transferability of the shares subject to the
award shall be governed by Section 2 of this Agreement.
4. ADJUSTMENTS. In the event of any stock dividend, reclassification,
subdivision or combination, or similar transaction affecting the shares covered
by this award, the rights of the Grantee are subject to adjustment as provided
in Section 3.01 of the Plan to the extent deemed necessary by the Board.
5. RIGHTS AS SHAREHOLDER. Subject to the restrictions and risk of
forfeiture set forth in Section 2, the Grantee shall have all rights of a
shareholder (including voting and dividend rights) with respect to the shares
subject to the award commencing on the date on which the shares subject to the
award are issued.
6. WITHHOLDING. The Grantee authorizes the Company to withhold from
his or her compensation to satisfy any income and employment tax withholding
obligations in connection with the award. If the Grantee is no longer employed
by the Company at the time any applicable taxes are due and must be remitted by
the Company, the Grantee agrees to pay applicable taxes to the Company, and the
Company may delay removal of the restrictive legend until proper payment of
such taxes has been made by the Grantee. The Grantee may satisfy such
obligations under this Section 6 by any method authorized under Section 4.06 of
the Plan.
7. NOTICES. Every notice relating to this Agreement shall be in
writing and if given by mail shall be given by registered or certified mail
with return receipt requested. All notices to the Company shall be delivered to
the President of the Company at the Company's headquarters. All notices by the
Company to the Grantee shall be delivered to the Grantee personally or
addressed to the Grantee at the Grantee's last residence address as then
contained in the records of the Company or such other address as the Grantee
may designate. Either party by notice to the other may designate a different
address to which notices shall be addressed. Any notice given by the Company to
the Grantee at the Grantee's last designated address shall be effective to bind
any other person who shall acquire rights hereunder.
8. GOVERNING LAW. This Agreement (a) shall be governed by and
construed in accordance with the laws of the State of Nevada without giving
effect to conflict of laws, and (b) is not valid unless it has been manually
signed by the Grantee and the Company.
9. PROVISIONS OF PLAN CONTROLLING. The provisions hereof are subject
to the terms and provisions of the Plan. In the event of any conflict between
the provisions of this Agreement and the provisions of the Plan, the provisions
of the Plan shall control.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
GRANTEE DATASCENSION, INC
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------- -----------------------------------
Executive Xxxxxx X. Xxxxxxxx, Director
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Xxxxxx Xxxxxx, Director
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxxx, Director
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