Registration of Securities by a Small-Business Issuer — Form SB-2
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SB-2 Registration Statement 110 527K
2: EX-1.1 Underwriting Agreement 39 132K
3: EX-1.2 Dealers Agreement 7 24K
4: EX-3.1 Articles of Incorporation 7 31K
5: EX-3.2 By-Laws 12 52K
6: EX-4.3 Warrant Agreement 34 102K
7: EX-4.4 Purchase Option 16 48K
8: EX-10.1 1996 Non-Employee Director Stock Option Plan 7 31K
11: EX-10.16 Lease Agreement 16 57K
12: EX-10.17 Lease Agreement 15 55K
13: EX-10.18 Lease Agreement 15 55K
9: EX-10.2 1996 Employee and Consultant Stock Option Plan 10 40K
14: EX-10.29 Agency and Sales Agreement 9 31K
15: EX-10.30 Requirments Agreement 9 22K
10: EX-10.5 Executive Employment Agreement Re: Benson Zinbarg 11 48K
16: EX-23.1 Consent of Independent Certified Public 1 8K
Accountants
17: EX-23.2 Consent of Law Offices of David Gordon 1 7K
EX-10.2 — 1996 Employee and Consultant Stock Option Plan
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SUN HILL INDUSTRIES, INC.
1996 EMPLOYEE AND CONSULTANT STOCK OPTION PLAN
* * * *
SECTION 1
PURPOSES.
SUN HILL INDUSTRIES, INC. (the "Company") desires to afford certain of its
key employees, officers and consultants who are responsible for the continued
growth of the Company an opportunity to acquire a proprietary interest in the
Company, and thus to create in such individuals an increased in and greater
concern for the welfare of the Company and its subsidiaries.
The Company, by means of this Employee and Consultant Stock Option Plan
(the "Plan"), seeks to retain the services of persons now holding key positions
and to secure the services of persons capable of filling such positions.
The stock options offered pursuant to the Plan are a matter of separate
inducement and are not in lieu of any salary or other compensation for the
services of any key employee or consultant.
The stock options granted under the Plan are intended to be either
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, or options that do not meet the requirements
for incentive stock options.
SECTION 2
DEFINITIONS.
As used in the Plan, the following terms shall have the meanings set forth
below:
(a) "Affiliate" shall mean (i) any entity that, directly or
indirectly through one or more intermediaries, is controlled by the Company and
(ii) any entity in which the Company has a significant equity interest.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, and any regulations promulgated thereunder.
(c) "Committee" shall mean a committee of the Board of Directors of
the Company designated by such Board to administer the Plan, which shall consist
of not less than two (2) "Non-Employee Directors," as such term is defined in
Rule 16b-3(b)(3)(i) promulgated under the Securities Exchange Act of 1934, as
amended, each having the requisite qualifications thereunder to satisfy the
requirements of Rule 16b-3.
(d) "Company" shall mean "SUN HILL INDUSTRIES, INC., a Delaware
corporation.
(e) "Eligible Person" shall mean any employee, officer or consultant
providing services to the Company or any Affiliate who the Committee determines
to be an Eligible Person. A director of the Company who is not also an employee
of the Company or an Affiliate shall not be an Eligible Person.
(f) "Fair Market Value" shall mean the closing "bid" price of the
Company's Shares on the date in question as quoted on the National Association
of Securities Dealers Automated Quotation System ("NASDAQ") or on any successor
national stock exchange on which the Common Stock is then traded, provided,
however, that if on the date in question there is no public market for the
Company's Shares and they are neither quoted on "NASDAQ" nor traded on a
national securities exchange, then the Committee shall, in its sole discretion
and best judgment, determine the Fair Market Value.
(g) "Incentive Stock Option" shall mean an option granted under the
Plan that is intended to meet the requirements of Section 422 of the Code or any
successor provision.
(h) "Non-Qualified Stock Option" shall mean an option granted under
the Plan that is not intended to be an Incentive Stock Option.
(i) "Option" shall mean an Incentive Stock Option or a Non-Qualified
Stock Option.
(j) "Option Agreement" shall mean any written agreement, contract or
document evidencing any Option granted under the Plan.
(k) "Participant" shall mean an Eligible Person designated to be
granted an Option under the Plan.
(l) "Person" shall mean any individual, corporation, partnership,
association, limited liability company, association or trust.
(m) "Plan" shall mean this 1996 Employee and Consultant Stock Option
Plan, as amended from time to time.
(n) "Rule 16b-3" shall mean Rule 16b-3 promulgated by the Securities
and Exchange Commission under the Securities Exchange Act of 1934, as amended,
or any successor rule or regulation.
(o) "Shares" shall mean shares of Common Stock, $.001 par value, of
the Company.
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SECTION 3
ADMINISTRATION.
(a) Power and Authority of the Committee. The Plan shall be
administered by the Committee. Subject to the express provisions of the Plan and
to applicable law, the Committee shall have full power and authority to: (i)
designate Participants; (ii) determine the types of Options (e.g., whether
Incentive Stock Options or Non-Qualified Stock Options) to be granted to each
Participant under the Plan; (iii) determine the number of Shares to be covered
by each Option; (iv) determine the terms and conditions of any Option Agreement;
(v) amend the terms and conditions of any Option Agreement and accelerate the
exercisability of Options covered thereunder; (vi) determine whether, to what
extent and under what circumstances Options may be exercised in cash, Shares or
other property, or canceled, forfeited or suspended; (vii) determine whether, to
what extent and under what circumstances Options shall be deferred either
automatically or at the election of the holder thereof or the Committee; (viii)
interpret and administer the Plan and any instrument or Option Agreement
relating to, or Option granted under the Plan; (ix) establish, amend, suspend or
waive such rules and regulations and appoint such agents as it shall deem
appropriate for the proper administration of the Plan; and (x) make any other
determination and take any other action that the Committee deems necessary or
desirable for the administration of the Plan. Unless otherwise expressly
provided in the Plan, all designations, determinations, interpretations and
other decisions under or with respect to the Plan or any Option shall be within
the sole discretion of the Committee, may be made at any time and shall be
final, conclusive and binding upon any Participant, any holder or beneficiary of
any Option granted under the Plan and any employee of the Company or any
Affiliate.
SECTION 4
AVAILABLE SHARES SUBJECT TO OPTION.
(a) Shares Available. The total number of Shares for which Options may be
granted pursuant to the Plan shall be 950,000 Shares of the Common Stock in the
aggregate, subject to adjustment as provided in Section 4(c). If any Shares
covered by an Option or to which an Option relates are not purchased or are
forfeited, or if an Option otherwise expires, then the number of Shares counted
against the aggregate number of Shares available under the Plan with respect to
such Option, to the extent of any such forfeiture or termination, shall again be
available for Options under the Plan.
(b) Accounting for Shares Covered by an Option. For purposes of this
Section 4, the number of Shares covered by an Option shall be counted on the
date of grant of such Option against the aggregate number of Shares available
for granting Options under the Plan.
(c) Adjustments. In the event that the Committee shall determine that any
dividend or other distribution (whether in the form of cash, Shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase or exchange of Shares or other securities of the Company, issuance of
warrants or other rights to purchase Shares or other securities of the Company
or other similar rights to purchase Shares or other securities of the Company or
other similar
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corporation transaction or event affects the Shares subject to Option grants
under the Plan such that an adjustment is determined by the Committee to be
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan, then the
Committee shall, in such manner as it may deem equitable, adjust any or all of
(i) the number of Shares which may thereafter be made the subject of Options;
(ii) the number of Shares subject to outstanding Option awards; (iii) the
purchase or exercise price with respect to any Option, provided, however, that
the number of Shares covered by an Option or to which such Option relates shall
always be a whole number.
(d) Incentive Stock Options. Notwithstanding the foregoing, the number of
Shares available for granting Incentive Stock Options under the Plan shall not
exceed 950,000, subject to adjustment as provided in the Plan and Section 422 or
424 of the Code or any successor provisions.
SECTION 5
ELIGIBILITY.
Any Eligible Person shall be eligible to be designated a Participant. In
determining which Eligible Persons shall receive an Option and the terms of any
Option, the Committee may take into account the nature of the services rendered
by the respective Eligible Persons, their present and potential contributions to
the success of the Company or such other factors as the Committee, in its
discretion, shall deem relevant. Notwithstanding the foregoing, an Incentive
Stock Option may only be granted to full or part-time employees (which term as
used herein includes, without limitation, officers and directors who are also
employees) and an Incentive Stock Option shall not be granted to an employee of
an Affiliate unless such Affiliate is also a "subsidiary corporation" of the
Company within the meaning of Section 424(f) of the Code or any successor
provision.
SECTION 6
OPTION AWARDS.
The Committee is hereby authorized to grant Options to Participants with
the following terms and conditions and with such additional terms and conditions
not inconsistent with the provisions of the Plan as the Committee shall
determine:
(i) Exercise Price. The purchase price per Share purchasable under
an Option shall be determined by the Committee, provided, however, that
such purchase price shall not be less than 100% of the Fair Market Value
of a Share on the date of grant of such Option, provided further, however,
that in the case of an Incentive Stock Option granted to a Participant
who, at the time such Option is granted, owns Shares of the Company or
shares of any subsidiary corporation or parent corporation of the Company
which possesses more than ten percent (10%) of the total combined voting
power of all classes of shares of the Company or of any subsidiary
corporation or parent corporation of the Company (hereinafter, a "10%
Shareholder), the purchase price for each Share shall be such amount as
the Committee in its best judgment shall determine to be not less than one
4
hundred ten percent (110%) of the Fair Market Value per Share at the date
the Incentive Stock Option is granted. In determining stock ownership of a
Participant for any purposes under the Plan, the rules of Section 424(d)
of the Code shall be applied, and the Committee may rely on
representations of fact made to it by Participant and believed by it to be
true.
(ii) Option Term. The term of each Option shall be fixed by the
Committee which in any event shall not exceed a term of ten (10) years
from the date of the grant, provided, however, that the term of any
Incentive Stock Option granted to any 10% Shareholder shall not be
exercisable after the expiration of five (5) years from the date such
Incentive Stock option was granted.
(iii) Maximum Grant of Incentive Stock Options. The aggregate Fair
Market Value (determined on the date the Incentive Stock Option is
granted) of Shares subject to an Incentive Stock Option (when first
exercisable) granted to a Participant by the Committee in any calendar
year shall not exceed $100,000.
(iv) Time and Method of Exercise. Subject to the provisions of the
Plan, the Committee shall determine the time or times at which an Option
may be exercised in whole or in part and the method or methods by which,
and the form or forms (including, without limitation, cash, Shares,
promissory notes, other securities, other property, or any combination
thereof, having a Fair Market Value on the exercise date equal to the
relevant exercise price) in which, payment of the exercise price with
respect thereto may be made or deemed to have been made.
(v) Limits on Transfer of Options. No Option shall be transferable
by a Participant otherwise than by will or by the laws of descent and
distribution; provided, however, that, if so determined by the Committee,
a Participant may, in the manner established by the Committee, designate a
beneficiary or beneficiaries to exercise the rights of the Participant and
receive any Shares purchased with respect to any Option upon the death of
the Participant. Each Option shall be exercisable during the Participant's
lifetime only by the Participant or, if permissible under applicable law,
by the Participant's guardian or legal representative. No Option or Shares
underlying any Option shall be pledged, alienated, attached or otherwise
encumbered, and any purported pledge, alienation, attachment or
encumbrance thereof shall be void and unenforceable against the Company or
any Affiliate.
(vi) Restrictions; Securities Exchange Listing. All certificates for
Shares delivered upon the exercise of Options under the Plan shall be
subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the Plan or the rules, regulations and
other requirements of the Securities and Exchange Commission and any
applicable federal or state securities laws, and the Committee may cause a
legend or legends to be placed on such certificates to make appropriate
reference to such restrictions. If the Shares or other securities are
traded on a national securities exchange, the Company shall not be
required to deliver any Shares covered by an Option unless and until such
Shares have been admitted for trading on such securities exchange.
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(vi) Termination of Employment. (A) Upon termination of the
employment or consultancy, as the case may be, of any Participant, an
Option previously granted to the Participant, unless otherwise specified
by the Committee in the Option, shall, to the extent not theretofore
exercised, terminate and become null and void, provided that:
(a) if the Participant shall die while in the employ of the
Company or during either the three (3) month or one (1) year period,
whichever is applicable, specified in clause (b) below and at a time
when such Participant was entitled to exercise an Option as herein
provided, the legal representative of such Participant, or such
Person who acquired such Option by bequest or inheritance or by
reason of the death of the Participant, may, not later than one (1)
year from the date of death, exercise such Option, to the extent not
theretofore exercised, in respect of any or all of such number of
Shares as specified by the Committee in such Option; and
(b) with respect to Participants who are employees, if the
employment of any employee to whom such Option shall have been
granted shall terminate by reason of the Employee's retirement (at
such age or upon such conditions as shall be specified by the Board
of Directors), disability (as described in Section 22(e)(3) of the
Code) or dismissal by the employer other than for cause (as defined
below), and while such employee Participants entitled to exercise
such option as herein provided, such employee Participant shall have
the right to exercise such Option so granted, to the extent not
theretofore exercised, in respect of any or all of such number of
Shares as specified by the Committee in such Option, at any time up
to and including (i) three (3) months after the date of such
termination of employment in the case of termination by reason of
retirement or dismissal other than for cause and (ii) one (1) year
after the date of termination of employment in the case of
termination by reason of disability.
(B) If a Participant voluntarily terminates his or her
employment or consultancy, as the case may be, or is discharged for cause,
any Option granted hereunder shall, unless otherwise specified by the
Committee in the Option, forthwith terminate with respect to any
unexercised portion thereof.
(C) If an Option granted hereunder shall be exercised by
the legal representative of a deceased or disabled Participant, or by a
person who acquired an Option granted hereunder by bequest or inheritance
or by reason of death of any such person, written notice of such exercise
shall be accompanied by a certified copy of letters testamentary or
equivalent proof of the right of such legal representative or other person
to exercise such Option.
(D) For all purposes of the Plan, the term "for cause"
shall mean, (i) with respect to a Participant who is a party to a written
employment or consultancy agreement
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with the Company, as the case may be, which contains a definition of "for
cause" or "cause" (or words of like import) for purposes of termination of
employment or consultancy thereunder by the Company, "for cause" or "cause"
as defined in the most recent of such agreements, or (ii) in all other
cases, as determined by the Committee, in its sole discretion, that one or
more of the following has occurred: (W) any failure by a Participant to
substantially perform his or her employment or consultancy duties, as the
case may be, which shall not have been corrected within thirty (30) days
following written notice thereof, (X) any engaging by such Participant in
misconduct or, in the case of an officer Participant, any failure or
refusal by such officer Participant to follow the directions of the
Company's Board of Directors or Chief Executive Officer of the Company
which, in either case, is injurious to the Company or any Affiliate, (Y)
any breach by a Participant of any covenant contained in the instrument
pursuant to which an Option is granted, or (Z) such Participant's
conviction of or entry of a plea of nolo contendere in respect of any
felony, or of a misdemeanor which results in or is reasonably expected to
result in economic or reputational injury to the Company or any of its
Affiliates.
SECTION 7
AMENDMENT AND TERMINATION; ADJUSTMENTS.
Except to the extent prohibited by applicable law and unless otherwise
expressly provided in an Option Agreement or in the Plan:
(a) Amendments to the Plan. The Board of Directors of the Company may
amend, alter, suspend, discontinue or terminate the Plan; provided, however,
that, notwithstanding any other provision of the Plan or any Option Agreement,
without the approval of the stockholders of the Company, no such amendment,
alteration, suspension, discontinuation or termination shall be made that,
absent such approval:
(i) would cause Rule 16b-3 to become unavailable with respect to the
Plan;
(ii) would violate the rules or regulations of any national
securities exchange on which the Shares of the Company are traded or the
rules or regulations of the National Association of Securities Dealers,
Inc. that are applicable to the Company; or
(iii) would cause the Company to be unable, under the Code, to grant
Incentive Stock Options under the Plan.
(b) Amendments to Option Grants. The Committee may waive any conditions or
rights of the Company under any outstanding Option grant, prospectively or
retroactively. The Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Option grant, prospectively or retroactively, without
the consent of the Participant or holder or beneficiary thereof, except as
otherwise herein provided.
7
(c) Correction of Defects, Omissions and Inconsistencies. The Committees
may correct any defect, supply any omission or reconcile any inconsistency in
the Plan or any Option in the manner and to the extent it shall deem desirable
to carry the Plan into effect.
SECTION 8
INCOME TAX WITHHOLDING; TAX BONUSES.
(a) Withholding. In order to comply with all applicable federal or state
income tax laws or regulations, the Company may take such action as it deems
appropriate to ensure that all applicable federal or state payroll, withholding,
income or other taxes, which are the sole and absolute responsibility of a
Participant, are withheld or collected from such Participant. In order to assist
a Participant in paying all or a portion of the federal and state taxes to be
withheld or collected upon exercise of any Option, the Committee, in its
discretion and subject to such additional terms and conditions as it may adopt,
may permit the Participant to satisfy such tax obligation by (i) electing to
have the Company withhold a portion of the Shares otherwise to be delivered upon
exercise of any Option with a Fair Market Value equal to the amount of such
taxes or (ii) delivering to the Company Shares other than the Shares issuable
upon exercise of the applicable Option with a Fair Market Value equal to the
amount of such taxes. The election, if any, must be made on or before the date
that the amount of tax to be withheld is determined.
(b) Tax Bonuses. The Committee, in its discretion, shall have the
authority, at the time of grant of any Option under this Plan or at any time
thereafter, to approve cash bonuses to designated Participants to be paid upon
their exercise in order to provide funds to pay all or a portion of federal and
sate taxes due as a result of such exercise. The Committee shall have full
authority in its discretion to determine the amount of any such tax bonus.
SECTION 9
GENERAL PROVISIONS.
(a) No Rights to Option Grants. No Eligible Person, Participant or other
Person shall have any claim to be granted an Option under the Plan, and there is
no obligation for uniformity of treatment of Eligible Persons, Participants or
holders or beneficiaries of Options granted under the Plan. The terms and
conditions of Options need not be the same with respect to any Participant or
with respect to different Participants.
(b) Option Agreements. No Participant will have rights under an Option
granted to such Participant unless and until an Option Agreement shall have been
duly executed on behalf of the Company. Each Option Agreement shall set forth
the terms and conditions of any Option granted to a Participant consistent with
the provisions of this Plan.
(c) No Limit on Other Compensation Arrangements. Nothing contained in the
Plan shall prevent the Company or any Affiliate from adopting or continuing in
effect other or additional compensation arrangements, and such arrangements may
be either generally applicable or applicable only in specific cases.
8
(d) No Right to Employment. The grant of an Option shall not be construed
as giving a Participant the right to be retained in the employ of the Company or
any Affiliate, nor will it affect in any way the right of the Company or an
Affiliate to terminate such employment at any time, with or without cause. In
addition, the Company or an Affiliate may at any time dismiss a Participant from
employment free from any liability or any claim under the Plan, unless otherwise
expressly provided in the Plan or in any Option Agreement.
(e) Governing Law. The validity, construction and effect of the Plan or
any Option granted hereunder, and any rules and regulations relating to the Plan
or any Option granted hereunder, shall be determined in accordance with the laws
of the State of Connecticut except to the extent preempted by Federal law.
(f) Severability. If any provision of the Plan or any Option is or becomes
or is deemed to be invalid, illegal or unenforceable in any jurisdiction or
would disqualify the Plan or any Option under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in
the determination of the Committee, materially altering the purpose or intent of
the Plan or the Option, such provision shall be stricken as to such jurisdiction
or Option, and the remainder of the Plan or any Option shall remain in full
force and effect.
(g) Section Headings. The section headings included herein are only for
convenience, and they shall have no effect on the interpretation of the Plan.
SECTION 10
EFFECTIVE DATE OF THE PLAN.
The Plan shall be effective on November 1, 1996 (the "Plan Effective
Date"), subject to approval by the Company's stockholders within one (1) year
thereafter.
SECTION 11
TERM OF THE PLAN.
Unless the Plan shall have been discontinued or terminated as provided in
Section 7(a), the Plan shall terminate on October 31, 2006. No Option shall be
granted after the termination of the Plan. However, unless otherwise expressly
provided in the Plan or in an applicable Option Agreement, any Option
theretofore granted may extend beyond the termination of the Plan, and the
authority of the Committee provided for hereunder with respect to the Plan and
any Option grants, and the authority of the Board of Directors of the Company to
amend the Plan, shall extend beyond the termination of the Plan.
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IN WITNESS WHEREOF, this Plan has been executed at Stamford, Connecticut
on this 7th day of November, 1996.
SUN HILL INDUSTRIES, INC.
By /s/ Benson Zinbarg
-----------------------------
Benson Zinbarg, President and
Chief Executive Officer
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Dates Referenced Herein
| Referenced-On Page |
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| This ‘SB-2’ Filing | | Date | | First | | Last | | | Other Filings |
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| |  |
| | 10/31/06 | | 9 | | | | | None on these Dates |
| Filed on: | | 11/25/96 |
| | 11/1/96 | | 9 |
| List all Filings |
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