§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
EXHIBIT F
GOLF-TECHNOLOGY HOLDING, INC.
1997 STOCK OPTION AND LONG-TERM INCENTIVE PLAN
1. Purpose.
This Golf-Technology Holding, Inc. 1997 Stock Option and Long-Term Incentive
Plan is intended to promote the interests of Golf-Technology Holding, Inc. and its
shareholders by providing key employees of the Company and its subsidiaries, on whose
judgment, initiative, and efforts the successful conduct of the business of the Company
depends, and who are responsible for the management, growth, and protection of the
business, as well as directors of the Company and consultants to the Company and its
subsidiaries with appropriate incentives and rewards to encourage employees to continue in
the employ of the Company and to maximize their performance and to encourage dire ctors
and consultants to maximize their efforts on behalf of the Company.
2. Definitions.
As used in the Plan, the following definitions apply to the terms indicated
below:
(a) Board
"Board" shall mean the Board of Directors of the Company.
(b) Cause
"Cause" shall mean, when used in connection with the termination of a
Participant's employment, the termination of the Participant's employment on account of: (i)
the willful and continued failure by the Participant substantially to perform his or he r duties
and obligations to the Company (other than any such failure resulting from incapacit y due to
physical or mental illness), (ii) the willful violation by the Participant of (A) any federal or
state law or (B) any rule of the Company, which violation would materially reflec t on the
Participant's character, competence, or integrity, (iii) a breach by a Participant of the
Participant's duty of loyalty to the Company such as Participant's solicitation of cust omers or
employees of the Company on behalf of any other person, (iv) the Participant's unauthorized
removal from the Company's premises of any document (in any medium or form) relating to
the Company, its business, or its customers, provided, however, that no such removal shall be
deemed "unauthorized" if it is in furtherance of an individual's duties and obligations to the
Company and such removal is a common practice at the Company, (v) the Participa nt's
unauthorized disclosure to any person of any confidential information regarding the
Company, (vi) the willful engaging by the Participant in any other misconduct which i s
materially injurious to the Company or (vii) any event that constitutes "cause" (or any similar
term that constitutes the basis on which the Company may terminate the empl oyee's
employment with the Company) for purposes of an employment agreement between the
Participant and the Company. For purposes of this Paragraph 2(b) 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 in bad faith and without reasonable belief that the action or omission was in the
best interests of the Company. Any rights the Company may have hereunder in respect of the
events giving rise to Cause shall be in addition to the rights the Company may
have under any other agreement with the Participant or at law or in equity. If, subsequent to
the termination of a Participant's employment without Cause, it is determined by the Board
that the Participant's employment could have been terminated for Cause, such Part icipant's
employment shall, at the election of the Committee in its sole discreti on, be deemed to have
been terminated for Cause.
(c) Code
"Code" shall mean the Internal Revenue Code of 1986, as amended.
(d) Committee
"Committee" shall mean the Option Committee of the Board as provided in
Paragraph 3.
(e) Company
"Company" shall mean Golf-Technology Holding, Inc., an Idaho
corporation.
(f) Common Stock
"Common Stock" shall mean the common stock, par value $.001 per share,
of the Company.
(g) Disability
"Disability" shall mean any physical or mental condition as a result of
which a Participant is disabled as described in Section 422(c)(6) of the Code.
(h) Exchange Act
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(i) Incentive Award
"Incentive Award" shall mean an Option or a Restricted Stock award
granted pursuant to the terms of the Plan.
(j) Incentive Stock Option
"Incentive Stock Option" shall mean an Option that is an "incentive stock
option" within the meaning of Section 422 of the Code and that is identified as a n Incentive
Stock Option in the grant agreement by which it is evidenced.
(k) Issue Date
"Issue Date" shall mean the date established by the Committee on which
certificates representing shares of Restricted Stock shall be issued by the Company pursuant
to the terms of Paragraph 15(d) hereof.
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
(l) Non-Qualified Stock Option
"Non-Qualified Stock Option" shall mean an Option that is not an Incentive
Stock Option.
(m) Option
"Option" shall mean an option to purchase shares of Common Stock
granted pursuant to Paragraph 6 hereof. Each Option, or portion thereof, shall be identified as
either an Incentive Stock Option or a Non-Qualified Stock Option in the grant agreem ent by
which such Option is evidenced.
(n) Participant
"Participant" shall mean an employee, officer, director or outside director of
the Company or any subsidiary of the Company or a consultant to the Company or any
subsidiary of the Company selected to participate in the Plan and to whom an Incentive
Award is granted pursuant to the Plan, and, upon his or her death, that person's successors,
heirs, executors, and administrators, as the case may be.
(o) Plan
"Plan" shall mean this Golf-Technology Holding, Inc. 1997 Stock Option
and Long-Term Incentive Plan, as it may be amended from time to time.
(p) Restricted Stock
"Restricted Stock" shall mean a share of Common Stock that is granted
pursuant to the terms of Paragraph 15 hereof and that is subject to the restrictions se t forth in
Paragraph 15(c) hereof for as long as such restrictions continue to apply to such share.
(q) Retirement
"Retirement" shall mean a Participant's termination of employment (other
than by reason of death or Disability and other than a termination that is (or is deem ed to
have been) for Cause) on or after the later of (i) the date the Participant at tains age 65 and (ii)
the date the Participant has completed five years of service with the Company.
(r) Securities Act
"Securities Act" shall mean the Securities Act of 1933, as amended.
(s) Vesting Date
"Vesting Date" shall mean the date and/or dates established by the
Committee on which Restricted Stock may vest.
3. Administration of the Plan.
(a) Board or Committee Administration.
The Plan shall be administered by the Board. The Board may appoint an
Option Committee (the "Committee") of two or more of its members to administer this Plan,
provided however, the Committee shall not take any action under the Plan unless it is at a ll
times composed solely of not less than two "Non-Employee Directors" within the meaning of
Rule 16b-3, as promulgated under the Exchange Act. Hereinafter, all references in this Pl an
to the "Committee" shall mean the Board if the Committee is not compose d of two Non-
Employee Directors when the Company is subject to the Securities Act, or, if the C ommittee
is unable to act or no Committee has been appointed and the Board shall take any and all
actions required or permitted to be taken by the Committee under the Plan and shall serve as
the Committee.
Subject to ratification of the grant or authorization of each Incentive Award
by the Board (if so required by applicable state law), and subject to the te rms of the Plan, the
Committee shall have the authority to:
(i) designate the employees, officers, directors or outside directors of the Company or any subsidiary or consultants to
the Company or any subsidiary to whom Incentive Awards
may be granted and the amount and type of such Incentive
Awards;
(ii) determine the time or times at which Incentive Awards may be granted;
(iii) determine the price of shares subject to each Option, which price shall not be less than the minimum prices specified in
Paragraphs 7 and 13 with respect to Non-Qualified and
Incentive Stock Options;
(iv) determine whether each Option granted shall be an Incentive Stock Option or a Non-Qualified Stock Option;
(v) determine, subject to Paragraph 8, the time or times when each Option shall become exercisable and the duration of the
exercise period;
(vi) determine whether restrictions such as repurchase options are to be imposed on shares subject to Options, and the
nature of such restrictions, if any;
(vi) in its absolute discretion and without amendment to the Plan, (i) accelerate the date on which any Option granted under the
Plan becomes exercisable, (ii) accelerate the Issue Date or
Vesting Date of any share of Restricted Stock issued under
the Plan or waive any condition imposed thereunder, or (iii)
otherwise adjust any of the terms of any Incentive Award
(except that no such adjustment shall, without the consent of
a Participant, reduce the Participant's rights under any
previously granted and outstanding Incentive Award);
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
(vii) grant, in its absolute discretion and without amendment
to the Plan, Incentive Awards on the condition that such
Participants surrender to the Committee for cancellation such
other Incentive Awards (including without limitation,
Options with higher exercise prices and values) as the
Committee specifies. Notwithstanding Paragraph 5 herein,
prior to the surrender of such other Incentive Awards,
Incentive Awards granted pursuant to the preceding sentence
of this Paragraph 3(a) shall not count against the limit set
forth in such Paragraph 5; and
(viii) interpret and construe any provision of the Plan and prescribe and rescind rules and regulations for administering
the Plan as it may deem necessary or appropriate.
The interpretation and construction by the Committee of any provisions of the Plan or of any
Incentive Award granted under it shall be final and binding on all parties.
(b) Committee Actions.
The Committee may select one of its members as its chairman, and shall
hold meetings at such time and places as it may determine. Acts by a ma jority of the
Committee, or acts reduced to or approved in writing by a majority of the members of the
Committee, shall be the valid acts of the Committee. From time to t ime the Board may
increase the size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill vacancie s
however caused, or remove all members of the Committee and thereafter directly administer
the Plan.
No member of the Committee shall be liable for any action, omission or
determination relating to the Plan, and the Company (and any affiliate that may adopt the
Plan), jointly and severally, shall indemnify and hold harmless each member of the
Committee and each other director or employee of the Company (or affiliate) to whom any
duty or power relating to the administration or interpretation of the Plan has been dele gated
against any cost or expense (including counsel fees) or liability (including any sum paid in
settlement of a claim with the approval of the Committee) arising out of any a ction, omission
or determination unless such action, omission or determination was taken or made by such
member, director or employee in bad faith and without reasonable belief that it was in the
best interests of the Company and its affiliates, as the case may be.
(c) Grant of Options to Directors.
All grants of Options to directors shall in all respects be made in accordance
with the provisions of this Plan applicable to other eligible persons. Directors who are either
(i) eligible for Options pursuant to the Plan or (ii) have been granted Options may vote on any
matters affecting the administration of the Plan or the grant of any Options pursuant to the
Plan, except that no such director shall act upon the granting to himself of Options, but any
such member may be counted in determining the existence of a quorum at any mee ting of the
Board during which action is taken with respect to the granting to him of Options.
4. Eligible Employees and Others.
The persons who shall be eligible to receive Incentive Awards pursuant to the Plan
shall be those employees, officers, directors and outside directors of the Company or
consultants to the Company who are responsible for the management, growth, and protection
of the business of the Company; provided, however, that Incentive Stock Options may only
be granted to employees of the Company or its subsidiaries. Those officers and directors of
the Company who are not employees may not be granted Incentive Stock Options under the
Plan. Non-qualified Stock Options or Restricted Stock may be granted to any employee,
officer or director (whether or not also an employee) or consultant of the Company or its
subsidiaries. The Committee may take into consideration a recipient's individual
circumstances in determining whether to grant an Incentive Stock Option, Non-Qualified
Stock Option or Restricted Stock. Granting of any Incentive Award to any individual or entity
shall neither entitle that individual or entity to, nor disqualify him from, partic ipation in any
other grant of Incentive Awards.
5. Stock.
The stock subject to Incentive Awards shall be authorized but unissued shares of
Common Stock or shares of Common Stock reacquired by the Company in any manner. The
aggregate number or shares which may be issued by the Committee in its sole and absol ute
discretion pursuant to which Incentive Awards may be granted under the Plan is one million
two hundred and fifty thousand (1,250,000) shares. The aggregate number or shares which
may be issued pursuant to this Plan may be adjusted as provided in Paragraph 16. If any
Incentive Award granted under the Plan shall expire or terminate for any reason without
having been exercised in full or shall cease for any reason to be exercisable in whol e or in
pan, the underlying shares covered by such Incentive Awards shall again be available for
future grants of Incentive Awards under the Plan.
6. Granting of Orations or Restricted Stock.
(a) Plan Awards.
Under the Plan, the Committee may, in its sole and absolute discretion, grant
either or both of the following types of Incentive Awards to a Participant: an Option or
Restricted Stock.
Incentive Awards may be granted by the Committee pursuant to the Plan at
any time on or after the adoption of the Plan by the Board, effective as of November 3, 1997,
and prior to November 3, 2007; provided however, that any Incentive Stock Options granted
hereunder shall be subject to the ratification and approval of the Plan by the consent of the
shareholders within twelve (12) months of the effective date; further provided, that failure t o
obtain shareholder approval shall not affect the validity of this Plan and the Incent ive Awards
granted hereunder except that all previous grants of Incentive Stock Options shall
automatically become grants of Non-Qualified Stock Options and no further Incentive Stock
Options shall be granted under the Plan.
The date of grant of an Incentive Award under the Plan will be the date
specified by the Committee at the time it grants the Incentive Award; provided however, that
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
such date shall not be prior to the date on which the Committee acts to approve the Incentive
Award. The Committee shall have the right, with the consent of the Participant, to convert an
Incentive Stock Option granted under the Plan to a Non-Qualified Stock Option pursuant to
Paragraph 18.
(b) Individual Awards.
Incentive Awards granted under the Plan may be made up entirely of one
type of Incentive Award or any combination of both Options and Restricted Stock, in the
Committee's sole discretion.
7. Option Price
(a) Price.
The exercise price per share as specified in the grant agreement relating to
each Option granted under the Plan shall be determined by the Committee, provided,
however, that the exercise price per share of each Incentive Stock Option granted under the
Plan shall not be less than the exercise prices set forth in Paragraph 13 hereof. T he exercise
price per share of each Non-Qualified Stock Option granted under the Plan may be less t han
or equal to the fair market value on the date of such grant but not less than eighty-fi ve percent
(85%) of fair market value on the date of such grant.
(b) Determination or Fair Market Value.
If, at the time an Option is granted under the Plan, the Company's Common
Stock is publicly traded, "fair market value" shall be determined as of the l ast business day
for which the prices or quotes discussed in this sentence are available prior to the date such
Option is granted and shall mean (i) the closing selling price per share on that date of the
Common Stock on the principal national securities exchange on which the Common Stock is
traded, if the Common Stock is then traded on a national securities exchange; or (ii) the
closing selling price per share on that date of the Common Stock on the NASDAQ National
Market List, if the Common Stock is not then traded on a national securities exc hange; or (iii)
the closing bid price per share last quoted on that date by an established quotati on service for
over-the-counter securities, if the Common Stock is not reported on the NASDAQ National
Market List. However, if the Common Stock is not publicly traded at the time an Option is
granted under the Plan, "fair market value" shall be deemed to be the fair val ue of the
Common Stock as determined by the Committee after taking into consideration all factors
which it deems appropriate, including, without limitation, recent sale and offer pric es of the
Common Stock in private transactions negotiated at arm's length.
8. Option Duration.
Subject to earlier termination as provided in Paragraph 10 and the Incentive Stock
Option limitations as provided in Paragraph 13, each Option shall expire on the date speci fied
by the Committee which shall be no later than ten years from the date of grant.
9. Exercise or Option.
Subject to the provisions of Paragraph 10, each Option granted under the Plan shall be
exercisable as follows:(i) Vesting. The Option shall either be fully exercisable on the date of
grant or shall become exercisable thereafter in such installments as the Comm ittee may
specify. In the absence of provisions is an individual grant agreement or employment
agreement to the contrary, Options shall vest ratably over a five (5) year period c ommencing
on the first anniversary of the date of grant.
(ii) Full Vesting or Installments. Once an installment becomes
exercisable it shall remain exercisable until expiration or termination of the Option, unless
otherwise specified by the Committee.
(iii) Partial Exercise. Each Option or installment may be exercised at any
time or from time to time, in whole or in part, for up to the total number of sha res with
respect to which it is then exercisable. Upon partial exercise of an Option, the grant
agreement evidencing such Option, marked with such notations as the Committee m ay deem
appropriate to evidence such partial exercise, shall be returned to the Participa nt exercising
such Option together with the delivery of the certificates described in Paragraph 12 hereof.
(iv) Acceleration of Vesting. The Committee shall have the right to
accelerate the date of exercise of any installment of any Option; provided that the Committee
shall not, without the consent of a Participant, accelerate the exercise date of any installment
of any Option granted to any employee as an Incentive Stock Option (and not previously
converted into a Non-Qualified Option pursuant to Paragraph 18) if such acceleration would
violate the annual vesting limitation contained in Section 422 of the Code, as desc ribed in
Paragraph 13.
10. Termination of Employment.
Unless otherwise provided in the Participant's grant agreement or employment
agreement, the following provisions shall apply upon the termination of a Participant's
employment:
(a) Termination other than for Cause, Retirement, Death or
Disability
If a Participant who has been granted an Option ceases to be employed by
the Company and all its subsidiaries other than for Cause or by reason of Retireme nt, death or
Disability, no further installments of his Options shall become exercisable, and his Opti ons
shall terminate after the passage of ninety (90) days from the date of termination of his
employment, but in no event later than on their specified expiration dates. Options gra nted to
such Participant, to the extent they were not exercisable at the time of such termination, shall
expire at the close of business on the date of such termination.
Employment shall be considered as continuing uninterrupted during any
bona fide leave of absence (such as those attributable to illness, military obliga tions or
governmental service) provided that the period of such leave does not exceed ninety (90)
days or, if longer, any period during which such Participant's right to reemployment is
guaranteed by statute. A bona fide leave of absence with the written approval of the
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
Committee shall not be considered an interruption of employment under the Plan, provided
that such written approval contractually obligates the Company or any subsidiary to continue
the employee of the Participant after the approved period of absence. Incentive Stock Options
granted under the Plan shall not be affected by any change of employment within or among
the Company and its subsidiaries, so long as the Participant continues to be an employee of
the Company or any subsidiary.
(b) Termination for Cause
If a Participant who has been granted an Option ceases to employed by the
Company and all its subsidiaries for Cause, all outstanding Options granted to such
Participant shall automatically expire at the commencement of the business as of the date of
such termination.
(c) Death / Disability / Retirement.
If a Participant who has been granted an Option ceases to be employed by
the Company and all subsidiaries by reason of his death, Disability or Retirement, he or his
personal representative or estate or beneficiary who has acquired the Option by will or by t he
laws of decent and distribution, shall have the right to exercise any Options held by him on
the date of termination of employment, to the extent of the number of shares with re spect to
which he could have exercised it on that date, at any time prior to the spe cified expiration
date of the Option. Options granted to such Participant, to the extent they were not
exercisable at the time of such termination, shall expire at the close of busi ness on the date of
such termination. The effect of exercising any Incentive Stock Option on a day that is more
than ninety (90) days after the date of termination (or, in the case of a termina tion of
employment on account of death or Disability, on a day that is more than one year after the
date of such termination) will be to cause such Incentive Stock Option to be tre ated as a Non-
Qualified Stock Option.
11. Assignability/Transfers.
(a) Assignability
No Option shall be assignable or transferable by the Participant except by
will or by the laws of descent and distribution and during the lifetime of the Partic ipant each
Option shall be exercisable only by the Participant.
(b) Upon Death.
Upon the death of a Participant, outstanding Options granted to such
Participant may be exercised only by the executors or administrators of the Participant 's estate
or by any person or persons who shall have acquired such right to exercise by will or by the
laws of descent and distribution. No transfer by will or the laws of descent and distribution of
any Option, or the right to exercise any Option, shall be effective to bind the Company unl ess
the Committee shall have been furnished with (a) written notice thereof and wi th a copy of
the will and/or such evidence as the Committee may deem necessary to est ablish the validity
of the transfer and (b) an agreement by the transferee to comply with all the terms and
conditions of the Options that are or would have been applicable to the Participant and to be
bound by the acknowledgments made by the Participant in connection with the grant of t he
Option.
12. Means of Exercising Options.
(a) Notice and Payment of Exercise Price
An Option (or any part or installment thereof) shall be exercised by giving
written notice to the Company at its principal office to the attention of i ts Secretary. Such
notice shall identify the Option being exercised and specify the number of shares as to which
such Option is being exercised, shall be signed by the Participant and shall be a ccompanied
by the grant agreement(s) evidencing the Option. Such written request shall be accompani ed
by full payment of the purchase price therefore either (a) in United States dollars i n cash or
by certified check, bank cashier's check or wire transfer; (b) subject to the approval of t he
Committee, through delivery of shares of Common Stock having a fair market value equa l as
of the date of the exercise to the cash exercise price of the Option; (c) subjec t to the approval
of the Committee, by delivery of the Participant's personal recourse note bearing intere st
payable not less than annually at no less than one hundred percent (100%) of the lowest
applicable Federal rate, as defined in Section 1274(d) of the Code, or (d) subject to the
approval of the Committee, pursuant to procedures adopted by the Committee whereby the
Participant, by a properly written notice, directs (x) an immediate market sale or margin loan
respecting all or a part of the share of Common Stock to which the Participant i s entitled
upon exercise pursuant to an extension of credit by the Company to the Participant of the
exercise price, (y) the delivery of the shares of Common Stock from the Company directl y to
the brokerage firm, and (z) the delivery of the exercise price form the sale Or ma rgin loan
proceeds from the brokerage directly to the Company; or (e) subject to the approval of t he
Committee, by any combination of (a), (b), (c) and (d) above or such other method as the
Committee may approve from time to time.
Any payment in shares of Common Stock shall be effected by the delivery
of such shares to the Secretary of the Company, duly endorsed in blank or accompanied by
stock powers duly executed in blank, together with any other documents and evidences as the
Secretary of the Company shall require from time to time.
(b) Certificates
Certificates for shares of Common Stock purchased upon the exercise of an
Option shall be issued in the name of the Participant or his or her beneficiary, as the case may
be, and delivered to the Participant or his or her beneficiary, as the case may be, as soon as
practicable following the date on which the Option is exercised.
(c) Fractional Shares
No fractional shares shall be issued under the Plan and the Participant shall
receive from the Company cash in lieu of such fractional shares.
13. Incentive Stock Option Limitations.
(a) $100,000 Annual Limitation on Incentive Stock Options.
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
Each eligible employee may be granted Incentive Stock Options only to the
extent that, in the aggregate under this Plan and all Incentive Stock Option pl ans of the
Company and any subsidiary, such Incentive Stock Options do not become exercisable for
the first time by such employee during any calendar year in a manner which would enti tle the
employee to purchase more than $100,000 in fair market value (determined at the tim e the
Incentive Stock Options were granted) of Common Stock in that year. Any Options granted
to an employee in excess of such amount will be granted as Non-Qualified Stock Options.
(b) Ten (10%) Owners
In the case of an Incentive Stock Option to be granted to an employee
owning stock possessing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or its subsidiaries, the price per share specified in the
agreement relating to such Incentive Stock Option shall not be less than one hundred ten
percent (110%) of the fair market value per share of Common Stock on the date of grant and
the Incentive Stock Option shall expire five years from the date of grant.
(c) Employee Status / Price
No Incentive Stock Option may be granted to an individual if, at the time of
the proposed grant, such individual is not an employee of the Company. In addition all
Incentive Stock Options shall be granted at no less than 100% of fair market value.
(d) Notice to Company of Disqualifying' Position.
Each employee who receives an Incentive Stock Option must agree to notify
the Company in writing immediately after the employee makes a Disqualifying Di sposition
of any Common Stock acquired pursuant to the exercise of an Incentive Stock Option. A
Disqualifying Disposition is any disposition (including any sale) of such Common Stock
before the later of (a) two years after the date the employee was granted the Incentive Stock
Option, or (b) one year after the date the employee acquired Common Stock by exercising the
Incentive Stock Option. If the employee has died before such stock is sold, these holding
period requirements do not apply and no Disqualifying Disposition can occur thereafter.
(e)
In the event an Incentive Stock Option granted hereunder does not meet the
requirements set forth in this Paragraph 13, such Incentive Stock Option shall automatical ly
be deemed to be a Non-Qualified Stock Option, but all other terms and provisions of such
Incentive Stock Option shall remain unchanged.
14. Grant Agreement / Terms and Conditions of Options.
Options shall be evidenced by grant agreements (which need not be identical) in such
form as the Committee may from time to time approve. Such grant agreements shall conform
to the terms and conditions set forth in Paragraphs 6 through 13 hereof and may contain suc h
other provisions as the Committee deems advisable. In granting any Non-Qualified Stock
Option, the Committee may specify that such Non-Qualified Stock Option shall be subject to
the restrictions set forth herein with respect to Incentive Stock Options, or to such other
termination and cancellation provisions as the Committee may determine. T he Committee
may from time to time confer authority and responsibility on one or more of its own members
and/or one or more officers of the Company to execute and deliver such instruments. The
proper officers of the Company are authorized and directed to take any and all action
necessary or advisable from time to time to carry out the terms of such instruments.
In the event of any conflict between the terms of the Plan, and a grant agreement
pursuant to which Options have been granted hereunder or the terms of an employment
agreement pursuant to which an employee of the Company who is a Participant has been
granted Options hereunder, the terms of the applicable employment agreement or relate d
grant agreement shall control. Notwithstanding the foregoing, no change in any employment
agreement or grant agreement shall cause any Incentive Stock Option granted hereunder to be
considered a Non-Qualified Stock Option.
15. Restricted Stock.
The Committee may grant shares of Restricted Stock pursuant to the Plan. Each grant
of shares of Restricted Stock shall be evidenced by an agreement in such form as t he
Committee shall from time to time approve. Each grant of shares of Restricted Stock shall
comply with and be subject to the following terms and conditions:
(a) Issue Date and Vesting Date.
At the time of the grant of shares of Restricted Stock, the Committee shall
establish an Issue Date or Issue Dates and a Vesting Date or Vesting Dates with respec t to
such shares. The Committee may divide such shares into classes and assign a different Issue
Date and/or Vesting Date for each class. Except as provided in Paragraphs 15(c) and 15(f)
hereof, upon the occurrence of the Issue Date with respect to a share of Restricted Stock, a
share of Restricted Stock shall be issued in accordance with the provisions of Paragraph 15(d)
hereof. Provided that all conditions to the vesting of a share of Restricted Stock imposed
pursuant to Paragraph 15(b) hereof are satisfied, and except as provided in Paragraphs 15(c)
and 15(f) hereof, upon the occurrence of the Vesting Date with respect to a share of
Restricted Stock, such share shall vest and the restrictions of Paragraph 15(c) hereof sha ll
cease to apply to such share.
(b) Conditions to Vesting.
At the time of the grant of shares of Restricted Stock, the Committee may
impose such restrictions or conditions, not inconsistent with the provisions hereof, to the
vesting of such shares as it, in its absolute discretion, deems appropriate. By way of example
and not by way of limitation, the Committee may require, as a condition to the vesting of any
shares of Restricted Stock, that the Participant or the Company achieve such performance
criteria as the Committee may specify at the time of the grant of such shares.
(c) Restrictions on Transfer Prior to Vesting.
Prior to the vesting of a share of Restricted Stock, no transfer of a
Participant's rights to such share, whether Voluntary or involuntary, by operation of law or
otherwise, shall vest the transferee with any interest, or right in, or with respect to, such share,
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
but immediately upon any attempt to transfer such rights, such share, and all the right s related
thereto, shall be forfeited by the Participant and the transfer shall be of no force or effect.
(d) Issuance of Certificates.
(i) Except as provided in Paragraphs 15(c) or 15(f) hereof, reasonably
promptly after the Issue Date with respect to shares of Restricted Stock, the Company sha ll
cause to be issued a stock certificate, registered in the name of the Participa nt to whom such
shares were granted, evidencing such shares, provided, that the Company shall not cause to
be issued such stock certificate unless it has received a stock power duly endorsed in blank
with respect to such shares. Each such stock certificate shall bear the following legend:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE
SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT
TO THE RESTRICTIONS, TERMS, AND CONDITIONS
(INCLUDING FORFEITURE PROVISIONS AND
RESTRICTIONS AGAINST TRANSFER) CONTAINED IN THE
GOLF-TECHNOLOGIES HOLDING, INC. 1997 STOCK
OPTION AND LONG-TERM INCENTIVE PLAN AND
RESTRICTED STOCK AWARD AGREEMENT ENTERED
INTO BETWEEN THE REGISTERED OWNER OF SUCH
SHARES AND GOLF-TECHNOLOGY HOLDING, INC. A
COPY OF THE PLAN AND AGREEMENT IS ON FILE IN THE
OFFICE OF THE SECRETARY OF GOLF-TECHNOLOGY
HOLDING, INC. GOLF-TECHNOLOGY, INC., 13000
C
O
SAWGRASS VILLAGE CIRCLE, SUITE 30, PONTE VEDRA
BEACH, FLORIDA 32082.
Such legend shall not be removed from the certificate evidencing such shares until such
shares vest pursuant to the terms hereof. (ii) Each certificate issued pursuant to Paragraph 15(d)(i) hereof, together
with the stock powers relating to the shares of Restricted Stock evidenced by such c ertificate,
shall be deposited by the Company with a custodian designated by the Company. The
Company shall cause such custodian to issue to the Participant a receipt evidenci ng the
certificates held by it which are registered in the name of the Participant.
(e) Consequences Upon Vesting.
Upon the vesting of a share of Restricted Stock pursuant to the terms hereof,
the restrictions of Paragraph 15(c) hereof shall cease to apply to such share. Reasonably
promptly after a share of Restricted Stock vests pursuant to the terms hereof, the Company
shall cause to be issued and delivered to the Participant to whom such shares were gra nted, a
certificate evidencing such share, free of the legend set forth in Paragraph 15(d)(i) here of,
together with any other property of the Participant held by the custodian pursuant to
Paragraph 15(d)(ii) hereof.
(f) Effect of Termination of Employment.
(i) In the event that the employment of a Participant with the Company shall
terminate for any reason other than Cause prior to the vesting of shares of Restricted Stoc k
granted to such Participant, the shares of Restricted Stock shall be forfeited on t he date of
such termination, provided however, that the Committee may, in its sole and absolute
discretion, vest the Participant in all or any portion of shares of Restricted Stock whi ch would
otherwise be forfeited pursuant to the provisions of this Paragraph.
(ii) In the event of the termination of a Participant's employment for
Cause, all shares of Restricted Stock granted to such Participant which have not ve sted as of
the date of such termination shall immediately be forfeited.
16. Adjustments.
Upon the occurrence of any of the following events, a Participant's rights with respect
to Incentive Awards granted to him hereunder shall be adjusted as hereinafter provided,
unless otherwise specifically provided in the grant agreement between the Participa nt and the
Company relating to such Incentive Award:
(a) Options - Stock Dividends and Stock Splits.
Subject to any required action by the shareholders of the Company, if the
shares of Common Stock shall be subdivided or combined into a greater or smaller number of
shares or if the Company shall issue any shares of Common Stock as a stock dividend on i ts
outstanding Common Stock or there shall be any other increase or decrease in the numbe r of
such shares effected without receipt of consideration by the Company, the number of shares
of Common Stock deliverable upon the exercise of Options shall be appropriately increased
or decreased proportionately, and appropriate adjustments shall be made in the exerci se price
per share to reflect such subdivision, combination or stock dividend.
(b) Options - Consolidations, Mergers, Sale, Dissolution or
Liquidation.
Subject to any required action by the shareholders of the Company, if the
Company is to be consolidated with or acquired by another entity in a merger, sal e of all or
substantially all of the Company's assets or otherwise (an "Acquisition"), dissolution or
liquidation of the Company, the Committee shall, as to outstanding Options, either (i) make
appropriate provision for the continuation of such Options by substituting immediately prior
to Such event (whether or not then exercisable) on an equitable basis for the shares t hen
subject to such Options the consideration payable with respect to the outstanding sha res of
Common Stock in connection with the Acquisition; (ii) upon written notice to the
Participants, provide that all Options must be exercised, to the extent then exerci sable, within
a specified number of days of the date of such notice, at the end of which period the Options
shall terminate; (iii) terminate all Options in exchange for a cash payme nt equal to the excess
of the fair market value of the shares subject to such Options (to the extent the n exercisable)
over the exercise price thereof, or (iv) any combination of (i), (ii) and (iii).
Subject to any required action by the shareholders of the Company, in the
event that the Company shall be the surviving corporation in any merger or consolidati on
(except a merger or consolidation as a result of which the holders of shares of Common St ock
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
receive securities of another corporation), each Option outstanding on the date of such merger
or consolidation shall pertain to and apply to the securities which a holder of the number of
shares of Common Stock subject to such Option would have received in such merger or
consolidation.
(c) Options - Recapitalization or Reorganization.
In the event of a recapitalization or reorganization of the Company (other
than a transaction described in subparagraph (b) above) pursuant to which securities of the
Company or of another corporation are issued with respect to the outstanding shares of
Common Stock, a Participant upon exercising an Option shall be entitled to recei ve for the
purchase price paid upon such exercise the new securities of equivalent value as he woul d
have received if he had exercised his Option prior to such recapitalization or reorganization.
(d) Modification of Incentive Stock Options.
Notwithstanding the foregoing, any adjustments made pursuant to
subparagraphs (a), (b) or (c) with respect to Incentive Stock Options shall be made only after
the Committee, after consulting with counsel for the Company, determines whether such
adjustments would constitute a "modification" of such Incentive Stock Options (as that te rm
is defined in Paragraph 424 of the Code) or would cause any adverse tax consequences for
the holders of such Incentive Stock Options. If the Committee determines that such
adjustments made with respect to Incentive Stock Options would constitute a modificat ion of
such Incentive Stock Options, it may refrain from making such adjustments.
(e) Outstanding Restricted Stock.
Unless the Committee in its absolute discretion otherwise determines, any
securities or other property (including dividends paid in cash) received by a Participa nt with
respect to a share of Restricted Stock, the Issue Date with respect to which occ urs prior to
such event, but which has not vested as of the date of such event, as a result of any di vidend,
stock split, reverse stock split, recapitalization, merger, consolidation, combination, exchange
of shares or similar corporate exchange will not vest until such share of Restricted St ock vests
and shall be promptly deposited with the custodian designated pursuant to Paragraph 15(d)(ii)
hereof.
The Committee may, in its absolute discretion, adjust any grant of shares of
Restricted Stock, the Issue Date with respect to which has not occurred as of the date of the
occurrence of any of the following events, to reflect any dividend, stock split, reverse st ock
split, recapitalization, merger, consolidation, combination, exchange of shares or simila r
corporate change as the Committee may deem appropriate to prevent the enla rgement or
dilution of rights of Participants under the grant.
(f) Issuance of Securities.
Except as expressly provided herein, no issuance by the Company of shares
or stock of any class, or securities convertible into shares of stock of any class, shall affect,
and no adjustment by reason thereof shall be made with respect to, the number or pric e of
shares subject to Incentive Awards. No adjustments shall be made to Options for dividends
paid in cash or in property other than securities of the Company.
(g) Adjustments.
Upon the happening of any of the events described in subparagraphs (a), (b)
or (c) above, the class and aggregate number of shares set forth in Paragraph 5 hereof tha t are
subject to Options which previously have been or subsequently may be granted under the
Plan shall also be appropriately adjusted to reflect the events described in such
subparagraphs. The Committee shall determine the specific adjustments to be made under this
Paragraph 16 and its determination shall be conclusive.
If any person or entity owning restricted Common Stock obtained by
exercise of an Option made hereunder receives shares or securities or cash in connecti on with
a corporate transaction described in subparagraphs (a), (b) or (c) above as a result of owning
such restricted Common Stock, such shares or securities or cash shall be subject to a ll of the
conditions and restrictions applicable to the restricted Common Stock with respect to which
such shares or securities or cash were issued, unless otherwise determined by the Committee.
17. Term and Amendment of Plan.
This Plan was adopted by the Board on November 3, 1997, subject to the approval by
the shareholders of the Company of the Plan. The Plan shall expire at the end of the day on
November 3, 2007 (except as to Options outstanding on that date). Subject to the provisions
of Paragraph 6 above, Incentive Awards may be granted under the Plan prior to the date of
stockholder approval of the Plan.
The Board may at any time, or from time to time, suspend or terminate the Pl an in
whole or in part, or amend it in such respects as the Board may deem appropriate. No
amendment, suspension or termination of the Plan shall, without the Participant's consent,
alter or impair any of the rights or obligations under any Option granted to an Parti cipant
under the Plan. The Board may amend the Plan, subject to the limitations cit ed above, in such
manner as it deems necessary to permit the granting of Incentive Awards meeting the
requirements of future amendments or issued regulations, if any, to the Code or to the
Exchange Act. If the Plan becomes qualified under Section 16b-3 of the Exchange Act, an
amendment would require shareholder approval under such Rule 16b-3 to retain the Plan's
qualification, then such amendment shall be presented to shareholders for ratification,
provided however, that the failure to obtain shareholder ratification shall not affect t he
validity of the Plan if so amended and the Incentive Awards granted hereunder. In addition, if
the rules of NASDAQ or such other exchange on which the securities of the Company are
traded would require shareholder approval of any amendment to the Plan, the amendment
shall be presented to shareholders for ratification.
18. Conversion / Termination of Incentive Stock Options.
The Committee, at the written request of any Participant may in its discreti on take
such actions as may be necessary to convert such Participant's Incentive Stock Options (or
any installments or portions or installments thereof) that have not been exercised on t he date
of conversion into Non-Qualified Stock Options at any time prior to the expiration of such
Incentive Stock Options, regardless of whether the Participant is an employee of the
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
Company or a subsidiary at the time of such conversion. Such actions may include, but not be
limited to, extending the exercise period or reducing the exercise price of the appropria te
installments of such Incentive Stock Options. At the time of such conversion, the Committ ee
(with the consent of the Participant) may impose such conditions on the exercise of the
resulting Non-Qualified Stock Options as the Committee in its discretion may determi ne,
provided that such conditions shall not be inconsistent with this Plan. Nothing in the Pla n
shall be deemed to give any Participant the right to have such Participant's Incent ive Stock
Options converted into Non-Qualified Stock Options, and no such conversion shall occur
until and unless the Committee takes appropriate action. The Committee, wi th the consent of
the Participant, may also terminate any portion of any Incentive Stock Option that has not
been exercised at the time of such termination.
19. Expenses/Application of Funds.
The expenses of the Plan shall be paid by the Company. Any proceeds received by the
Company from the sale of shares pursuant to Options granted under the Plan shall be used for
general corporate purposes.
20. Governmental Regulation.
The Company's obligation to sell and deliver shares of the Common Stock under this
Plan is subject to the approval of any governmental authority required in connection wit h the
authorization, issuance or sale of such shares. The Company shall be under no obligation to
effect the registration pursuant to the Securities Act of any interests in the Pla n or any shares
of Common Stock to be issued hereunder or to effect similar compliance under any state
laws. Notwithstanding anything herein to the contrary, the Company shall not be obligated to
cause to be issued or delivered any certificates evidencing shares of Common Stock pursuant
to the Plan unless and until the Company is advised by its counsel that the issuance and
delivery of such certificates is in compliance with all applicable laws, re gulations of
governmental authority, and the requirements of NASDAQ and any other securities exchange
on which shares of Common Stock are traded. The Committee may require, as a conditi on of
the issuance and delivery of certificates evidencing shares of Common Stock pursuant to t he
terms hereof, that the recipient of such shares make such covenants, agreements, and
representations, and that such certificates bear such legends, as the Committee , in its sole
discretion, deems necessary or desirable.
The exercise of any Option granted hereunder shall be effective only at such time a s
counsel to the Company shall have determined that the issuance and delivery of share s of
Common Stock pursuant to such exercise is in compliance with all applicable la ws,
regulations of governmental authority, and the requirements of NASDAQ and any other
securities exchange on which shares of Common Stock are traded. The Committee may, in its
sole discretion, defer the effectiveness of any exercise of an Option granted hereunder i n
order to allow the issuance of shares of Common Stock pursuant thereto to be made pursuant
to registration or an exemption from registration or other methods for compliance avai lable
under federal or state securities laws. The Committee shall inform the Partici pant in writing
of its decision to defer the effectiveness of the exercise of an Option granted hereunder.
During the period that the effectiveness of the exercise of an Option has been deferred, the
Participant may, by written notice, withdraw such exercise and obtain a refund of any a mount
paid with respect thereto.
All Common Stock issued pursuant to the terms of the Plan shall constitute "restricte d
securities," as that term is defined in Rule 144 promulgated pursuant to the Securit ies Act,
and may not be transferred except in compliance with the registration requirements of t he
Securities Act or an exemption therefrom.
Certificates for shares of Common Stock, when issued, may have substantially the
following legend, or statements of other applicable restrictions, endorsed thereon, and may
not be immediately transferable:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE
DAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THE
SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED,
TRANSFERRED OR OTHERWISE DISPOSED OF UNTIL THE
BOLDER HEREOF PROVIDES EVIDENCE STATISFACTORY TO
THE ISSUER (WHICH, IN THE DISCRETION OF THE ISSUER, MAY
INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER) THAT SUCH OFFER SALE, PLEDGE, TRANSFER OR
OTHER DISPOSITION WILL NOT VIOLATE APPLICATE FEDERAL
OR STATE LAWS.
This legend shall not be required for shares of Common Stock issued pursuant to an effective
registration statement under the Securities Act and in accordance with applica ble state
securities laws.
21. Withholding of Additional Income Taxes.
(a) Cash Remittance.
Whenever shares of Common Stock are to be issued upon the exercise of an
Option, the occurrence of the Issue Date or the Vesting Date with respect to a share of
Restricted Stock, the Company shall have the right to require the Participant to remit to the
Company in cash an amount sufficient to satisfy federal, state, and local withholdi ng tax
requirements, if any, attributable to such exercise, occurrence or payment prior to the delivery
of any certificate or certificates for such shares.
(b) Stock Remittance.
Subject to Paragraph 21(c) hereof, at the election of the Participant, subject
to the approval of the Committee, when shares of Common Stock are to be issued upon t he
exercise of an Option, the occurrence of the Issue Date or the Vesting Date with respect to a
share of Restricted Stock, in lieu of the remittance required by Paragraph 21(a) hereof, t he
Participant may tender to the Company a number of shares of Common Stock determined by
§18.254 PROXY STATEMENTS: STRATEGY & FORMS
1998 Jefren Publishing Company, Inc. 18-216G
such Participant, the fair market value of which at the tender date the Comm ittee determines
to be sufficient to satisfy the minimum federal, state and local withholding ta x requirements,
if any, attributable to such exercise, occurrence or grant and not greater than the Pa rticipant's
estimated total federal, state and local tax obligations associated wit h such exercise,
occurrence or grant.
(c) Stock Withholding.
The Company shall have the right, when shares of Common Stock are to be
issued upon the exercise of an Option, the occurrence of the Issue Date or the Vesting Date
with respect to a share of Restricted Stock, in lieu of requiring the remittance required by
Paragraph 21(a) hereof, to withhold a number of such shares, the fair market value of which
at the exercise date the Committee determines to
23. Failure to Comply.
In addition to the remedies of the Company elsewhere provided for herein, a failure
by a Participant (or beneficiary) to comply with any of the terms and conditions of the Plan or
the agreement executed by such Participant (or beneficiary) evidencing an Incentive Awa rd,
unless such failure is remedied by such Participant (or beneficiary) within ten (10) days afte r
having been notified of such failure by the Committee, shall be grounds for the cancella tion
and forfeiture of such Incentive Award, in whole or in part, as the Committee, in its absolute
discretion may determine.
24. Governing Law; Construction.
The validity and construction of the Plan and the instruments evidencing Options shall
be governed by the laws of the State of Delaware, or the laws of any jurisdiction in which the
Company or its successors in interest maybe organized. In construing this Plan, the singular
shall include the plural, and the masculine gender shall include the feminine a nd neuter,
unless the context otherwise requires.
Golf-Technology Holding, Inc. 11/13/97
