EXHIBIT 10.7
INTEGRAL TECHNOLOGIES, INC.
EMPLOYEE BENEFIT AND CONSULTING SERVICES
COMPENSATION PLAN
(AS RESTATED JANUARY 10, 1999)
SECTION 1. INTRODUCTION
1.1 Establishment. Effective as provided in Section 17, Integral
Technologies, Inc., a Nevada corporation (the "Company"), hereby establishes a
restated plan of long-term stock-based compensation incentives for selected
Eligible Participants of the Company and its affiliated corporations. Such a
plan was originally adopted on December 30, 1996. The plan as restated herein
and adopted by the Board of Directors on January 10, 1999, shall be known as
the Integral Technologies, Inc. Employee Benefit and Consulting Services
Compensation Plan (the "Plan").
1.2 Purpose. The purpose of the Plan is to promote the best interest
of the Company, and its stockholders by providing a means of non-cash
remuneration to selected Eligible Participants who contribute most to the
operating progress and earning power of the Company.
SECTION 2. DEFINITIONS
The following definitions shall be applicable to the terms used in the
Plan:
2.1 "Affiliated Corporation" means any corporation that is either a
parent corporation with respect to the Company or a subsidiary corporation with
respect to the Company (within the meaning of Sections 424(e) and (f),
respectively, of the Internal Revenue Code).
2.2 "Code" means the Internal Revenue Code of 1986, as it may be
amended from time to time.
2.3 "Committee" means a committee designated by the Board of Directors
to administer the Plan or, if no committee is so designated, the Board of
Directors. Any Committee Member who is also an Eligible Participant may receive
a grant only if he abstains from voting in favor of a grant to himself, and the
grant is determined and approved by the remaining Committee Members. The Board
of Directors, in its sole discretion, may at any time remove any member of the
Committee and appoint another Director to fill any vacancy on the Committee.
2.4 "Common Stock" means the Company's $.001 par value voting common
stock.
2.5 "Company" means Integral Technologies, Inc., a Nevada corporation
and its subsidiaries.
2.6 "Effective Date" means the effective date of the Plan, as set
forth in Section 17 hereof.
2.7 "Eligible Participant" or "Participant" means any employee,
director, officer, consultant, or advisor of the Company who is determined (in
accordance with the provisions of Section 4 hereof) to be eligible to receive
stock and exercise stock options hereunder.
2.8 "Fair Market Value" means with respect to Common Stock, as of any
date, the closing price of a share of Common Stock as reported on such exchange
on which the Company's Common Stock may be listed.
PAGE 1 OF 6
2.9 "Option" means the grant to an Eligible Participant of a right to
acquire shares of Restricted Stock of the Company, unless said shares are duly
registered or exempt pursuant to Rule 701 of the Securities Act of 1933, as
amended (the "Securities Act"), and thus freely tradable, pursuant to a Grant
of Option approved by the Committee and executed and delivered by the Company.
2.10 "Plan" means this Integral Technologies, Inc. Employee Benefit
and Consulting Services Compensation Plan as restated on January 10, 1999.
2.11 "Unrestricted Stock" means shares of common stock, $.001 par
value, of the Company underlying an Option which, if specified in the written
Option are, upon issuance, freely tradable by virtue of having been registered
with the Securities and Exchange Commission ("SEC") under cover of Form S-8, or
another appropriate registration statement, or become freely tradable by virtue
of Rule 701, and which shares have been issued subject to the "blue sky"
provisions of any appropriate state jurisdiction. Special resale restrictions
may, however, apply to officers, directors, control shareholders and affiliates
of the Company and such individuals or entities will be required to obtain an
opinion of counsel as regards their ability to resell shares received pursuant
to this Plan. The Company is not obligated by this Plan to obtain any required
opinions of counsel, or to file any type of registration statement with the SEC
on any state of other jurisdiction.
2.12 "Stock" or "Restricted Stock" means shares of common stock, $.001
par value, of the Company issuable directly under the Plan or underlying a
Grant of Option, which shall, upon issuance, be subject to the restrictions set
forth in Section 11 hereof.
Wherever appropriate, words used in the Plan in the singular may mean
the plural, the plural may mean the singular, and the masculine may mean the
feminine.
SECTION 3. ADOPTION AND ADMINISTRATION OF THE PLAN
This plan of long-term stock-based compensation incentives for
selected Eligible Participants of the Company and its affiliated corporations
was originally adopted on December 30, 1996 (the "Plan"). In the absence of
contrary action by the Board of Directors, and except for action taken by the
Committee pursuant to Section 4 in connection with the determination of
Eligible Participants, any action taken by the Committee or by the Board of
Directors with respect to the implementation, interpretation or administration
of the Plan shall be final, conclusive and binding.
SECTION 4. ELIGIBILITY AND AWARDS
The Committee shall determine at any time and from time to time after
the effective date of the Plan: (i) the Eligible Participants; (ii) the number
of shares of Common Stock issuable directly or to be granted pursuant to the
Option which an Eligible Participant may exercise; (iii) the price per share at
which each option may be exercised, in cash or cancellation of fees for
services for which the Company is liable, if applicable, or the value per share
if a direct issue of stock; and (iv) the terms on which each option may be
granted. Such determination, as may from time to time be amended or altered at
the sole discretion of the Committee. Notwithstanding the provisions of Section
3 hereof, no such determination by the Committee shall be final, conclusive and
binding upon the Company unless and until the Board of Directors has approved
the same; provided, however, that if the Committee is composed of a majority of
the persons then comprising the Board of Directors of the Company, such
approval by the Board of Directors shall not be necessary.
SECTION 5. GRANT OF OPTION
Subject to the terms and provisions of this Plan, the terms and
conditions under which the Option may be granted to an Eligible Participant
shall be set forth in a written agreement (i.e., a Consulting Agreement,
Services Agreement, Fee Agreement, or Employment Agreement) or a written Grant
of Option
PAGE 2 OF 6
in the form attached hereto as Exhibit A and made a part hereof and containing
such modifications thereto and such other provisions as the Committee, in its
sole discretion, may determine. Notwithstanding the foregoing provisions of
this Section 5, each Grant of Option shall incorporate the provisions of this
Plan by reference.
SECTION 6. TOTAL NUMBER OF SHARES OF COMMON STOCK
The total number of shares of Common Stock reserved for issuance by
the Company either directly or underlying Options granted under this Plan shall
not, on any given date, exceed 15% of the outstanding shares of Common Stock of
the Company. The total number of shares of Common Stock reserved for such
issuance may be increased only by a resolution adopted by the Board of
Directors and amendment of the Plan. Such Common Stock may be authorized and
unissued or reacquired Common Stock of the Company.
SECTION 7. PURCHASE OF SHARES OF COMMON STOCK
7.1 As soon as practicable after the determination by the Committee
and approval by the Board of Directors (if necessary, pursuant to Section 4
hereof) of the Eligible Participants and the number of shares an Eligible
Participant may be issued directly or granted pursuant to an Option, the
Committee shall give notice (written or oral) thereof to each Eligible
Participant, which notice may be accompanied by the Grant of Option, if
appropriate, to be executed by such Eligible Participant. Upon receipt, an
Eligible Participant may exercise his right to an Option to purchase Common
Stock by providing written notice as specified in the Grant of Option.
7.2 The negotiated cost basis of stock issued directly or the exercise
price for each option to purchase shares of Common Stock pursuant to paragraph
7.1 shall be as determined by the Committee, it being understood that the price
so determined by the Committee may vary from one Eligible Participant to
another. In computing the negotiated direct issue price or the Option exercise
price of a share of Common Stock, the Committee shall take into consideration,
among other factors, the restrictions set forth in Section 11 hereof.
SECTION 8. PAYMENT UPON EXERCISE OF OPTION OR DIRECT ISSUANCE
The Committee shall determine the terms of the Grant of Option and the
exercise price or direct issue price for payment by each Participant for his
shares of Common Stock granted thereunder. Such terms shall be set forth or
referred to in the Grant of Option or Board Resolution authorizing the share
issuance. The terms and/or exercise price so set by the Committee may vary from
one Participant to another. In the event that all the Committee approves an
Option grant permitting deferred payments, the Participant's obligation to pay
for such Common Stock shall be evidenced by a Promissory Note executed by such
Participant and containing such modifications thereto and such other provisions
as the Committee, in its sole discretion, may determine.
SECTION 9. DELIVERY OF SHARES OF COMMON STOCK UPON EXERCISE
The Company shall deliver to or on behalf of each Participant such
number of shares of Common Stock as such Participant elects to purchase upon
direct issuance or upon exercise of the Option. Such shares, which shall be
fully paid and nonassessable upon the issuance thereof (unless a portion or all
of the purchase price shall be paid on a deferred basis) shall be represented
by a certificate or certificates registered in the name of the Participant and
stamped with an appropriate legend referring to the restrictions thereon, if
any, as may be set forth in the Grant of Option. Subject to the terms and
provisions of the Nevada Business Corporation Act and the Grant of Option to
which he is a party, a Participant shall have all the rights of a stockholder
with respect to such shares, including the right to vote the shares and to
receive all dividends or other distributions paid or made with respect thereto
(except to the extent such Participant defaults under the promissory note, if
any, evidencing the deferred purchase price for such
PAGE 3 OF 6
shares), provided that such shares shall be subject to the restrictions
hereinafter set forth. In the event of a merger or consolidation to which the
Company is a party, or of any other acquisition of a majority of the issued and
outstanding shares of common stock of the Company involving an exchange or a
substitution of stock of an acquiring corporation for common stock of the
Company, or of any transfer of all or substantially all of the assets of the
Company in exchange for stock of an acquiring corporation, a determination as
to whether the stock of the acquiring corporation so received shall be subject
to the restrictions set forth in Section 11 shall be made solely by the
acquiring corporation.
SECTION 10. RIGHTS OF EMPLOYEES; PARTICIPANTS
10.1 Employment. Nothing contained in the Plan or in any Stock Option,
Restricted Stock award or other Common Stock award granted under the Plan shall
confer upon any Participant any right with respect to the continuation of his
or her employment by the Company or any Affiliated Corporation, or interfere in
any way with the right of the Company or any Affiliated Corporation, subject to
the terms of any separate employment agreement to the contrary, at any time to
terminate such employment or to increase or decrease the compensation of the
Participant from the rate in existence at the time of the grant of a Stock
Option or other Common Stock award. Whether an authorized leave of absence, or
absence in military or government service, shall constitute termination of
employment shall be determined by the Committee at the time.
10.2 Non-transferability. No right or interest of any Participant in a
Stock Option award shall be assignable or transferable during the lifetime of
the Participant, either voluntarily or involuntarily, or subjected to any lien,
directly or indirectly, by operation of law, or otherwise, including execution,
levy, garnishment, attachment, pledge or bankruptcy. In the event of a
Participant's death, a Participant's rights and interest in Stock Option awards
shall be transferable by testamentary will or the laws of descent and
distribution, and payment of any amounts due under the Plan shall be made to,
and exercise of any Stock Options may be made by, the Participant's legal
representatives, heirs or legatees. If in the opinion of the Committee a person
entitled to payments or to exercise rights with respect to the Plan is unable
to care for his or her affairs because of mental condition, physical condition,
or age, payment due such person may be made to, and such rights shall be
exercised by, such person's guardian, conservator or other legal personal
representative upon furnishing the Committee with evidence satisfactory to the
Committee of such status.
SECTION 11. GENERAL RESTRICTIONS
11.1 Restrictive Legend. All shares of Common Stock issued or issuable
under this plan, unless qualified as Unrestricted Stock as defined in Section 2
hereinabove, shall be restricted, and certificates representing the shares
shall bear the following restrictive legend:
The shares represented by this certificate have not been registered
under the Securities Act of 1933 ("the Act") and are "restricted
securities" as that term is defined in Rule 144 under the Act. the
shares may not be offered for sale, sold or otherwise transferred
except pursuant to an effective registration statement under the Act
or pursuant to an exemption from registration under the Act, the
availability of which is to be established to the satisfaction of the
Company.
11.2 Investment Representations. The Company may require any person to
whom a Stock Option, Restricted Stock award, or other Common Stock award is
granted, as a condition of exercising such Stock Option, or receiving such
Restricted Stock award, or other Common Stock award, to give written assurances
in substance and form satisfactory to the Company and its counsel to the effect
that such person is acquiring the Common Stock subject to the Stock Option,
Restricted Stock award, or other Common Stock award for his or her own account
for investment and not with any present intention of selling or otherwise
distributing the same, and to such other effects as the Company deems necessary
or appropriate in order to comply with federal and applicable state securities
laws.
PAGE 4 OF 6
11.3 Compliance with Securities Laws. Each Stock Option shall be
subject to the requirement that if at any time counsel to the Company shall
determine that the listing, registration or qualification of the shares subject
to such Stock Option upon any securities exchange or under any state or federal
law, or the consent or approval of any governmental or regulatory body, is
necessary as a condition of, or in connection with, the issuance or purchase of
shares thereunder, such Stock Option may not be accepted or exercised in whole
or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained on conditions acceptable to the
Committee. Nothing herein shall be deemed to require the Company to apply for
or to obtain such listing, registration or qualification.
11.4 Changes in Accounting Rules. Notwithstanding any other provision
of the Plan to the contrary, if, during the term of the Plan, any changes in
the financial or tax accounting rules applicable to Stock Options, Restricted
Stock awards or other Common Stock awards shall occur that, in the sole
judgment of the Committee, may have a material adverse effect on the reported
earnings, assets or liabilities of the Company, the Committee shall have the
right and power to modify as necessary, or cancel, any then outstanding and
unexercised Stock Options, any then outstanding Restricted Stock awards as to
which the applicable employment restriction has not been satisfied and any
other Common Stock awards.
SECTION 12. WITHHOLDING REQUIREMENT
The Company's obligations to deliver shares of Common Stock upon the
exercise of any Stock Option granted under the Plan or pursuant to any other
Common Stock award, shall be subject to the Participant's satisfaction of all
applicable federal, state and local income and other tax withholding
requirements. The Company may, in its sole discretion, withhold the appropriate
number of shares of Common Stock from Participant's option exercise to satisfy
such tax requirements.
SECTION 13. PLAN BINDING UPON ASSIGNS OR TRANSFEREES
In the event that, at any time or from time to time, any shares of
Common Stock are sold, exchanged, assigned or transferred to any party (other
than the Company) pursuant to the provisions of Section 10.2 hereof, such party
shall take such shares of Common Stock pursuant to all provisions and
conditions of this Plan, and, as a condition precedent to the transfer of such
shares of Common Stock, such party shall agree (for and on behalf of himself or
itself, his or its legal representatives and his or its transferees and
assigns) in writing to be bound by all provisions of this Plan.
SECTION 14. COSTS AND EXPENSES
All costs and expenses with respect to the adoption, implementation,
interpretation and administration of the Plan shall be borne by the Company.
SECTION 15. CHANGES IN CAPITAL STRUCTURE OF THE COMPANY
Unless otherwise consented to by the Company in writing or unless
otherwise required by law, the shares of Restricted Stock issuable upon
exercise of the Option which are held by a Participant shall not be adjusted in
any manner for: (i) a subdivision or combination of any of the shares of
capital stock of the Company; (ii) a dividend payable in shares of capital
stock of the Company; (iii) a reclassification of any shares of capital stock
of the Company; or (iv) any other change in the capital structure of the
Company.
SECTION 16. PLAN AMENDMENT, MODIFICATION AND TERMINATION
The Board, upon recommendation of the Committee or at its own
initiative, at any time may terminate and at any time and from time to time and
in any respect, may amend or modify the Plan, including:
PAGE 5 OF 6
(a) Increase the total amount of Common Stock that may be
awarded under the Plan, except as provided in Section 15 of the Plan;
(b) Change the classes of Eligible Employees from which
Participants may be selected or materially modify the requirements as
to eligibility for participation in the Plan;
(c) Increase the benefits accruing to Participants; or
(d) Extend the duration of the Plan.
Any Stock Option or other Common Stock award granted to a Participant
prior to the date the Plan is amended, modified or terminated will remain in
effect according to its terms unless otherwise agreed upon by the Participant;
provided, however, that this sentence shall not impair the right of the
Committee to take whatever action it deems appropriate under Section 11 or
Section 15. The termination or any modification or amendment of the Plan shall
not, without the consent of a Participant, affect his rights under a Stock
Option, Restricted Stock Award or other Common Stock award previously granted
to him. With the consent of the Participant, the Committee may amend
outstanding option agreements in a manner not inconsistent with the Plan. The
Board shall have the right to amend or modify the terms and provisions of the
Plan and of any outstanding Stock Options granted under the Plan.
SECTION 17. EFFECTIVE DATE OF THE PLAN
17.1 Effective Date. The Plan as restated herein is effective as of
January 10, 1999.
17.2 Duration of the Plan. The Plan shall terminate at midnight on
December 29, 2001, which is the day before the fifth anniversary of the
original Effective Date, and may be terminated prior thereto by action of the
Board of Directors; and no Stock Option, Restricted Stock Award or other Common
Stock award shall be granted after such termination. Stock Options, Restricted
Stock Awards and other Common Stock awards outstanding at the time of the Plan
termination may continue to be exercised, or become free of restrictions, in
accordance with their terms.
SECTION 18. BURDEN AND BENEFIT
The terms and provisions of this Plan shall be binding upon, and shall
inure to the benefit of, each Participant, his executives or administrators,
heirs, and personal and legal representatives.
Executed as a sealed instrument as of the 10th day of January, 1999.
INTEGRAL TECHNOLOGIES, INC.
By: /s/ William S. Robinson
-----------------------------------
William S. Robinson, Chairman
ATTEST:
William A. Ince
- --------------------------------
William A. Ince, Secretary
PAGE 6 OF 6
EXHIBIT A
FORM OF
GRANT OF OPTION PURSUANT TO THE
INTEGRAL TECHNOLOGIES, INC.
EMPLOYEE BENEFIT AND CONSULTING SERVICES COMPENSATION PLAN
Integral Technologies, Inc., a Nevada corporation (the "Company"),
hereby grants to ________________________________ ("Optionee") an option to
purchase _________ shares of common stock, $.001 par value (the "Shares") of
the Company at the purchase price of US$______ per share (the "Purchase Price")
in accordance with and subject to the terms of the Company's Employee Benefit
and Consulting Services Compensation Plan. This Grant of Option is exercisable
in whole or in part, and upon payment in cash or cancellation of fees, or other
form of payment acceptable to the Company, to the offices of the Company at
Suite #3, 1070 West Pender Street, Vancouver, British Columbia, Canada V6E 2N7.
In the event that Optionee's employee or consultant status with the
Company or any of its subsidiaries ceases or terminates for any reason
whatsoever, including, but not limited to, death, disability, or voluntary or
involuntary cessation or termination, this Grant of Option shall terminate with
respect to any portion of this Grant of Option that has not been validly
exercised prior to the date of cessation or termination of employee or
consultant status, as determined in the sole discretion of the Company, and no
rights hereunder may be exercised after said date.
Subject to the preceding paragraph, this Grant of Option, or any
portion hereof, may be exercised only to the extent vested per the attached
schedule, and must be exercised by Optionee no later than
____________________________ (the "Expiration Date") by (i) notice in writing,
sent by facsimile copy to the Company at its address set forth above; and (ii)
payment of the Purchase Price pursuant to the terms of this Grant of Option and
the Company's Employee Benefit and Consulting Services Compensation Plan. Any
portion of this Grant of Option that is not exercised on or before to the
Expiration Date shall lapse. The notice must refer to this Grant of Option, and
it must specify the number of shares being purchased, and recite the
consideration being paid therefor. Notice shall be deemed given on the date on
which the notice is delivered to the Company by facsimile transmission bearing
an authorized signature of Optionee.
This Grant of Option shall be considered validly exercised once
payment therefor has cleared the banking system or the Company has issued a
credit memo for services in the appropriate amount, or receives a duly executed
acceptable promissory note, if this Grant of Option is granted with deferred
payment, and the Company has received written notice of such exercise.
If Optionee fails to exercise this Grant of Option in accordance with
this Agreement, then this Agreement shall terminate and have no force and
effect, in which event Optionor and Optionee shall have no liability to each
other with respect to this Grant of Option.
This Grant of Option may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Execution and delivery
of this Grant of Option by exchange of facsimile copies bearing the facsimile
signature of a party hereto shall constitute a valid and binding execution and
delivery of this Grant of Option by such party. Such facsimile copies shall
constitute enforceable original documents.
The validity, construction and enforceability of this Grant of Option
shall be construed under and governed by the laws of the State of Nevada,
without regard to its rules concerning conflicts of laws, and
PAGE A-1
any action brought to enforce this Grant of Option or resolve any controversy,
breach or disagreement relative hereto shall be brought only in a court of
competent jurisdiction in Vancouver, British Columbia, Canada.
The shares of stock issued upon exercise of this Grant of Option (the
"Underlying Shares") are not subject to adjustment due to any changes in the
capital structure of the Company as set forth in Section 15 of the Plan.
Further, the Underlying Shares may not be sold, exchanged, assigned,
transferred or permitted to be transferred, whether voluntarily, involuntarily
or by operation of law, delivered, encumbered, discounted, pledged,
hypothecated or otherwise disposed of until (i) the Underlying Shares have been
registered with the Securities and Exchange Commission pursuant to an effective
registration statement on Form S-8, or such other form as may be appropriate,
in the discretion of the Company; or (ii) an Opinion of Counsel, satisfactory
to the Company, has been received, which opinion sets forth the basis and
availability of any exemption for resale or transfer from federal and/or state
securities registration requirements, such as federal Rules 144 or 701.
IN WITNESS WHEREOF, this Grant of Option has been executed effective
as of ____________________, 19___.
INTEGRAL TECHNOLOGIES, INC.
BY THE BOARD OF DIRECTORS
OR A SPECIAL COMMITTEE THEREOF
NOT FOR EXECUTION
By:
-------------------------------
NOT FOR EXECUTION
By:
-------------------------------
NOT FOR EXECUTION
By:
-------------------------------
OPTIONEE:
NOT FOR EXECUTION
- -------------------------------
PAGE A-2
GRANT OF OPTION PURSUANT TO THE INTEGRAL TECHNOLOGIES, INC. EMPLOYEE
BENEFIT AND CONSULTING SERVICES COMPENSATION PLAN, RESTATED JANUARY
10, 1999
OPTIONEE: ___________________
OPTION GRANTED: _____________ Shares
PURCHASE PRICE: US$_______ per Share
DATE OF GRANT: ___________________
EXPIRATION DATE: ___________________
VESTING SCHEDULE: OPTION ON
#SHARES DATE VESTED (ASSUMING CONTINUED
------- ----------- EMPLOYEE OR CONSULTANT
STATUS, ETC.)
---------- -----------
---------- -----------
---------- -----------
---------- -----------
---------- -----------
VESTED OPTIONS EXERCISED TO DATE: _________ (INCLUDING THIS EXERCISE)
BALANCE OF VESTED OPTIONS TO BE EXERCISED: _________
===============================================================================
NOTICE OF EXERCISE
(TO BE SIGNED ONLY UPON EXERCISE OF THE OPTION)
TO: Integral Technologies, Inc. ("Optionor")
The undersigned, the holder of the Option described above, hereby
irrevocably elects to exercise the purchase rights represented by such Option
for, and to purchase thereunder, _________ shares of the Common Stock of
Integral Technologies, Inc., and herewith makes payment of
_______________________ therefor. Optionee requests that the certificates for
such shares be issued in the name of Optionee and be delivered to Optionee at
the address of __________________________________________________, and if such
shares shall not be all of the shares purchasable hereunder, represents that a
new Subscription of like tenor for the appropriate balance of the shares, or a
portion thereof, purchasable under the Grant of Option pursuant to the Integral
Technologies, Inc. Employee Benefit and Consulting Services Compensation Plan
restated January 10, 1999, be delivered to Optionor when and as appropriate.
OPTIONEE:
Dated:
-------------------------- -----------------------------------
PAGE A-3
GRANT OF OPTION PURSUANT TO THE
INTEGRAL TECHNOLOGIES, INC.
EMPLOYEE BENEFIT AND CONSULTING SERVICES COMPENSATION PLAN
Integral Technologies, Inc., a Nevada corporation (the "Company"),
hereby grants to ________________________________ ("Optionee") an option to
purchase _________ shares of common stock, $.001 par value (the "Shares") of
the Company at the purchase price of US$______ per share (the "Purchase Price")
in accordance with and subject to the terms of the Company's Employee Benefit
and Consulting Services Compensation Plan. This Grant of Option is exercisable
in whole or in part, and upon payment in cash or cancellation of fees, or other
form of payment acceptable to the Company, to the offices of the Company at
Suite #3, 1070 West Pender Street, Vancouver, British Columbia, Canada V6E 2N7.
In the event that Optionee's employee or consultant status with the
Company or any of its subsidiaries ceases or terminates for any reason
whatsoever, including, but not limited to, death, disability, or voluntary or
involuntary cessation or termination, this Grant of Option shall terminate with
respect to any portion of this Grant of Option that has not been validly
exercised prior to the date of cessation or termination of employee or
consultant status, as determined in the sole discretion of the Company, and no
rights hereunder may be exercised after said date.
Subject to the preceding paragraph, this Grant of Option, or any
portion hereof, may be exercised only to the extent vested per the attached
schedule, and must be exercised by Optionee no later than
____________________________ (the "Expiration Date") by (i) notice in writing,
sent by facsimile copy to the Company at its address set forth above; and (ii)
payment of the Purchase Price pursuant to the terms of this Grant of Option and
the Company's Employee Benefit and Consulting Services Compensation Plan. Any
portion of this Grant of Option that is not exercised on or before to the
Expiration Date shall lapse. The notice must refer to this Grant of Option, and
it must specify the number of shares being purchased, and recite the
consideration being paid therefor. Notice shall be deemed given on the date on
which the notice is delivered to the Company by facsimile transmission bearing
an authorized signature of Optionee.
This Grant of Option shall be considered validly exercised once
payment therefor has cleared the banking system or the Company has issued a
credit memo for services in the appropriate amount, or receives a duly executed
acceptable promissory note, if this Grant of Option is granted with deferred
payment, and the Company has received written notice of such exercise.
If Optionee fails to exercise this Grant of Option in accordance with
this Agreement, then this Agreement shall terminate and have no force and
effect, in which event Optionor and Optionee shall have no liability to each
other with respect to this Grant of Option.
This Grant of Option may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Execution and delivery
of this Grant of Option by exchange of facsimile copies bearing the facsimile
signature of a party hereto shall constitute a valid and binding execution and
delivery of this Grant of Option by such party. Such facsimile copies shall
constitute enforceable original documents.
The validity, construction and enforceability of this Grant of Option
shall be construed under and governed by the laws of the State of Nevada,
without regard to its rules concerning conflicts of laws, and any action
brought to enforce this Grant of Option or resolve any controversy, breach or
disagreement relative hereto shall be brought only in a court of competent
jurisdiction in Vancouver, British Columbia, Canada.
The shares of stock issued upon exercise of this Grant of Option (the
"Underlying Shares") are not subject to adjustment due to any changes in the
capital structure of the Company as set forth in Section 15 of the Plan.
Further, the Underlying Shares may not be sold, exchanged, assigned,
transferred or permitted to be transferred, whether voluntarily, involuntarily
or by operation of law, delivered, encumbered, discounted, pledged,
hypothecated or otherwise disposed of until (i) the Underlying Shares have been
registered with the Securities and Exchange Commission pursuant to an effective
registration statement on Form S-8, or such other form as may be appropriate,
in the discretion of the Company; or (ii) an Opinion of Counsel, satisfactory
to the Company, has been received, which opinion sets forth the basis and
availability of any exemption for resale or transfer from federal and/or state
securities registration requirements, such as federal Rules 144 or 701.
IN WITNESS WHEREOF, this Grant of Option has been executed effective
as of ____________________, 19___.
INTEGRAL TECHNOLOGIES, INC.
BY THE BOARD OF DIRECTORS
OR A SPECIAL COMMITTEE THEREOF
By:
-----------------------------------
WILLIAM S. ROBINSON
By:
-----------------------------------
WILLIAM A. INCE
OPTIONEE:
- -----------------------------------
GRANT OF OPTION PURSUANT TO THE INTEGRAL TECHNOLOGIES, INC. EMPLOYEE
BENEFIT AND CONSULTING SERVICES COMPENSATION PLAN, RESTATED JANUARY
10, 1999
OPTIONEE: ___________________
OPTION GRANTED: _____________ Shares
PURCHASE PRICE: US$_______ per Share
DATE OF GRANT: ___________________
EXPIRATION DATE: ___________________
VESTING SCHEDULE: OPTION ON
#SHARES DATE VESTED (ASSUMING CONTINUED
------- ----------- EMPLOYEE OR CONSULTANT
STATUS, ETC.)
---------- -----------
---------- -----------
---------- -----------
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VESTED OPTIONS EXERCISED TO DATE: _________ (INCLUDING THIS EXERCISE)
BALANCE OF VESTED OPTIONS TO BE EXERCISED: _________
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NOTICE OF EXERCISE
(TO BE SIGNED ONLY UPON EXERCISE OF THE OPTION)
TO: Integral Technologies, Inc. ("Optionor")
The undersigned, the holder of the Option described above, hereby
irrevocably elects to exercise the purchase rights represented by such Option
for, and to purchase thereunder, _________ shares of the Common Stock of
Integral Technologies, Inc., and herewith makes payment of
_______________________ therefor. Optionee requests that the certificates for
such shares be issued in the name of Optionee and be delivered to Optionee at
the address of __________________________________________________, and if such
shares shall not be all of the shares purchasable hereunder, represents that a
new Subscription of like tenor for the appropriate balance of the shares, or a
portion thereof, purchasable under the Grant of Option pursuant to the Integral
Technologies, Inc. Employee Benefit and Consulting Services Compensation Plan
restated January 10, 1999, be delivered to Optionor when and as appropriate.
OPTIONEE:
Dated:
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