1999 Non-Employee Directors' Stock Option Plan - Quokka Sports Inc.
QUOKKA SPORTS, INC.
1999 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
ADOPTED BY THE BOARD OF DIRECTORS APRIL 2, 1999
APPROVED BY STOCKHOLDERS _______________, 1999
EFFECTIVE DATE: _______________, 1999
TERMINATION DATE: APRIL __, 2009
1. PURPOSES.
(a) ELIGIBLE OPTION RECIPIENTS. The persons eligible to receive
Options are the Non-Employee Directors of the Company.
(b) AVAILABLE OPTIONS. The purpose of the Plan is to provide a means
by which Non-Employee Directors may be given an opportunity to
benefit from increases in value of the Common Stock through the
granting of Nonstatutory Stock Options.
(c) GENERAL PURPOSE. The Company, by means of the Plan, seeks to
retain the services of its Non-Employee Directors, to secure and
retain the services of new Non-Employee Directors and to provide
incentives for such persons to exert maximum efforts for the
success of the Company and its Affiliates.
2. DEFINITIONS.
(a) "AFFILIATE" means any parent corporation or subsidiary
corporation of the Company, whether now or hereafter existing,
as those terms are defined in Sections 424(e) and (f),
respectively, of the Code.
(b) "ANNUAL GRANT" means an Option granted to a Non-Employee
Director who meets the specified criteria pursuant to subsection
6(b) of the Plan.
(c) "ANNUAL MEETING" means the annual meeting of the stockholders of
the Company.
(d) "BOARD" means the Board of Directors of the Company.
(e) "CODE" means the Internal Revenue Code of 1986, as amended.
(f) "COMMON STOCK" means the common stock of the Company.
(g) "COMPANY" means Quokka Sports, Inc., a Delaware corporation.
(h) "CONSULTANT" means any person, including an advisor, (i) engaged
by the Company or an Affiliate to render consulting or advisory
services and who is compensated for such services or (ii) who is
a member of the Board of Directors
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of an Affiliate. However, the term "Consultant" shall not
include either Directors of the Company who are not compensated
by the Company for their services as Directors or Directors of
the Company who are merely paid a director's fee by the Company
for their services as Directors.
(i) "CONTINUOUS SERVICE" means that the Optionholder's service with
the Company or an Affiliate, whether as an Employee, Director or
Consultant, is not interrupted or terminated. The Optionholder's
Continuous Service shall not be deemed to have terminated merely
because of a change in the capacity in which the Optionholder
renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the
Optionholder renders such service, provided that there is no
interruption or termination of the Optionholder's Continuous
Service. For example, a change in status from a Non-Employee
Director of the Company to a Consultant of an Affiliate or an
Employee of the Company will not constitute an interruption of
Continuous Service. The Board or the chief executive officer of
the Company, in that party's sole discretion, may determine
whether Continuous Service shall be considered interrupted in
the case of any leave of absence approved by that party,
including sick leave, military leave or any other personal
leave.
(j) "DIRECTOR" means a member of the Board of Directors of the
Company.
(k) "DISABILITY" means the inability of a person, in the opinion of
a qualified physician acceptable to the Company, to perform the
major duties of that person's position with the Company or an
Affiliate of the Company because of the sickness or injury of
the person.] [the permanent and total disability of a person
within the meaning of Section 22(e)(3) of the Code].
(l) "EMPLOYEE" means any person employed by the Company or an
Affiliate. Mere service as a Director or payment of a director's
fee by the Company or an Affiliate shall not be sufficient to
constitute "employment" by the Company or an Affiliate.
(m) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
(n) "FAIR MARKET VALUE" means, as of any date, the value of the
Common Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or traded on the Nasdaq National Market or the
Nasdaq SmallCap Market, the Fair Market Value of a share
of Common Stock shall be the closing sales price for such
stock (or the closing bid, if no sales were reported) as
quoted on such exchange or market (or the exchange or
market with the greatest volume of trading in the Common
Stock) on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or
such other source as the Board deems reliable.
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(ii) In the absence of such markets for the Common Stock, the
Fair Market Value shall be determined in good faith by the
Board.
(o) "INITIAL GRANT" means an Option granted to a Non-Employee
Director who meets the specified criteria pursuant to subsection
6(a) of the Plan.
(p) "IPO DATE" means the effective date of the initial public
offering of the Common Stock.
(q) "NON-EMPLOYEE DIRECTOR" means a Director who is not an Employee.
(r) "NONSTATUTORY STOCK OPTION" means an Option not intended to
qualify as an incentive stock option within the meaning of
Section 422 of the Code and the regulations promulgated
thereunder.
(s) "OFFICER" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(t) "OPTION" means a Nonstatutory Stock Option granted pursuant to
the Plan.
(u) "OPTION AGREEMENT" means a written agreement between the Company
and an Optionholder evidencing the terms and conditions of an
individual Option grant. Each Option Agreement shall be subject
to the terms and conditions of the Plan.
(v) "OPTIONHOLDER" means a person to whom an Option is granted
pursuant to the Plan or, if applicable, such other person who
holds an outstanding Option.
(w) "PLAN" means this Quokka Sports, Inc. 1999 Non-Employee
Directors' Stock Option Plan.
(x) "RULE 16B-3" means Rule 16b-3 promulgated under the Exchange Act
or any successor to Rule 16b-3, as in effect from time to time.
(y) "SECURITIES ACT" means the Securities Act of 1933, as amended.
3. ADMINISTRATION.
(a) ADMINISTRATION BY BOARD. The Board shall administer the Plan
unless and until the Board delegates administration of the Plan
to a committee.
(b) POWERS OF BOARD. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:
(i) To determine the provisions of each Option to the extent
not specified in the Plan.
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(ii) To construe and interpret the Plan and Options granted
under it, and to establish, amend and revoke rules and
regulations for its administration. The Board, in the
exercise of this power, may correct any defect, omission
or inconsistency in the Plan or in any Option Agreement,
in a manner and to the extent it shall deem necessary or
expedient to make the Plan fully effective.
(iii) To amend the Plan or an Option as provided in Section 12.
(iv) Generally, to exercise such powers and to perform such
acts as the Board deems necessary or expedient to promote
the best interests of the Company which are not in
conflict with the provisions of the Plan.
4. SHARES SUBJECT TO THE PLAN.
(a) SHARE RESERVE. Subject to the provisions of Section 11 relating
to adjustments upon changes in stock, the stock that may be
issued pursuant to Options shall not exceed in the aggregate Four
Hundred Fifty Thousand (450,000) shares of Common Stock.
(b) REVERSION OF SHARES TO THE SHARE RESERVE. If any Option shall for
any reason expire or otherwise terminate, in whole or in part,
without having been exercised in full, the stock not acquired
under such Option shall revert to and again become available for
issuance under the Plan.
(c) SOURCE OF SHARES. The stock subject to the Plan may be unissued
shares or reacquired shares, bought on the market or otherwise.
5. ELIGIBILITY.
Nondiscretionary Options as set forth in section 6 shall be granted
under the Plan to all Non-Employee Directors.
6. NON-DISCRETIONARY GRANTS.
(a) INITIAL GRANTS. Without any further action of the Board, each
Non-Employee Director shall be granted the following Options:
(i) On IPO Date, each person who is then a Non-Employee
Director automatically shall be granted an Initial Grant
to purchase Twenty Five Thousand (25,000) shares of
Common Stock on the terms and conditions set forth
herein.
(ii) After the IPO Date, each person who is elected or
appointed for the first time to be a Non-Employee
Director automatically shall, upon the date of his or
her initial election or appointment to be a Non-Employee
Director by the Board or stockholders of the Company, be
granted an Initial Grant
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to purchase Twenty Five Thousand (25,000) shares of
Common Stock on the terms and conditions set forth
herein.
(b) ANNUAL GRANTS. On June 1 of each year commencing with
June 1, 2000, each person who is then a Non-Employee Director
automatically shall be granted an Annual Grant to purchase Twenty
Five Thousand (25,000) shares of Common Stock on the terms and
conditions set forth herein; provided however, that if the person
has not been serving as a Non-Employee Director for the entire
period since the preceding June 1, then the number of shares
subject to the Annual Grant shall be reduced pro rata for each
full quarter prior to the date of grant during which such person
did not serve as a Non-Employee Director.
7. OPTION PROVISIONS.
Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:
(a) TERM. No Option shall be exercisable after the expiration of
three (3) years from the date it was granted.
(b) EXERCISE PRICE. The exercise price of each Option shall be one
hundred percent (100%) of the Fair Market Value of the stock
subject to the Option on the date the Option is granted.
Notwithstanding the foregoing, an Option may be granted with an
exercise price lower than that set forth in the preceding
sentence if such Option is granted pursuant to an assumption or
substitution for another option in a manner satisfying the
provisions of Section 424(a) of the Code.
(c) CONSIDERATION. The purchase price of stock acquired pursuant to
an Option may be paid, to the extent permitted by applicable
statutes and regulations, in any combination of (i) cash or
check, (ii) delivery to the Company of other Common Stock, (ii)
deferred payment or (iv) any other form of legal consideration
that may be acceptable to the Board and provided in the Option
Agreement; provided, however, that at any time that the Company
is incorporated in Delaware, payment of the Common Stock's "par
value," as defined in the Delaware General Corporation Law,
shall not be made by deferred payment.
In the case of any deferred payment arrangement, interest shall be
compounded at least annually and shall be charged at the minimum rate of
interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement.
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(d) TRANSFERABILITY. An Option shall not be transferable except by
will or by the laws of descent and distribution and shall be
exercisable during the lifetime of the Optionholder only by the
Optionholder. Notwithstanding the foregoing, the Optionholder
may, by delivering written notice to the Company, in a form
satisfactory to the Company, designate a third party who, in the
event of the death of the Optionholder, shall thereafter be
entitled to exercise the Option.
(e) VESTING GENERALLY. Options shall vest and become exercisable
immediately upon grant.
(f) TERMINATION OF CONTINUOUS SERVICE. In the event an
Optionholder's Continuous Service terminates (other than upon
the Optionholder's death or Disability), the Optionholder may
exercise his or her Option (to the extent that the Optionholder
was entitled to exercise it as of the date of termination) but
only within such period of time ending on the earlier of (i) the
date three (3) months following the termination of the
Optionholder's Continuous Service, or (ii) the expiration of the
term of the Option as set forth in the Option Agreement. If,
after termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the
Option shall terminate.
(g) EXTENSION OF TERMINATION DATE. If the exercise of the Option
following the termination of the Optionholder's Continuous
Service (other than upon the Optionholder's death or Disability)
would be prohibited at any time solely because the issuance of
shares would violate the registration requirements under the
Securities Act, then the Option shall terminate on the earlier
of (i) the expiration of the term of the Option set forth in
subsection 7(a) or (ii) the expiration of a period of three (3)
months after the termination of the Optionholder's Continuous
Service during which the exercise of the Option would not be in
violation of such registration requirements.
(h) DISABILITY OF OPTIONHOLDER. In the event an Optionholder's
Continuous Service terminates as a result of the Optionholder's
Disability, the Optionholder may exercise his or her Option (to
the extent that the Optionholder was entitled to exercise it as
of the date of termination), but only within such period of time
ending on the earlier of (i) the date twelve (12) months
following such termination or (ii) the expiration of the term of
the Option as set forth in the Option Agreement. If, after
termination, the Optionholder does not exercise his or her
Option within the time specified herein, the Option shall
terminate.
(i) DEATH OF OPTIONHOLDER. In the event (i) an Optionholder's
Continuous Service terminates as a result of the Optionholder's
death or (ii) the Optionholder dies within the three-month
period after the termination of the Optionholder's Continuous
Service for a reason other than death, then the Option may be
exercised (to the extent the Optionholder was entitled to
exercise the Option as of the date of death) by the
Optionholder's estate, by a person who acquired the right
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to exercise the Option by bequest or inheritance or by a person
designated to exercise the Option upon the Optionholder's death,
but only within the period ending on the earlier of (1) the date
eighteen (18) months following the date of death or (2) the
expiration of the term of such Option as set forth in the Option
Agreement. If, after death, the Option is not exercised within
the time specified herein, the Option shall terminate.
8. COVENANTS OF THE COMPANY.
(a) AVAILABILITY OF SHARES. During the terms of the Options, the
Company shall keep available at all times the number of shares
of Common Stock required to satisfy such Options.
(b) SECURITIES LAW COMPLIANCE. The Company shall seek to obtain from
each regulatory commission or agency having jurisdiction over
the Plan such authority as may be required to grant Options and
to issue and sell shares of Common Stock upon exercise of the
Options; provided, however, that this undertaking shall not
require the Company to register under the Securities Act the
Plan, any Option or any stock issued or issuable pursuant to any
such Option. If, after reasonable efforts, the Company is unable
to obtain from any such regulatory commission or agency the
authority which counsel for the Company deems necessary for the
lawful issuance and sale of stock under the Plan, the Company
shall be relieved from any liability for failure to issue and
sell stock upon exercise of such Options unless and until such
authority is obtained.
9. USE OF PROCEEDS FROM STOCK.
Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.
10. MISCELLANEOUS.
(a) STOCKHOLDER RIGHTS. No Optionholder shall be deemed to be the
holder of, or to have any of the rights of a holder with respect
to, any shares subject to such Option unless and until such
Optionholder has satisfied all requirements for exercise of the
Option pursuant to its terms.
(b) NO SERVICE RIGHTS. Nothing in the Plan or any instrument
executed or Option granted pursuant thereto shall confer upon
any Optionholder any right to continue to serve the Company as a
Non-Employee Director or shall affect the right of the Company
or an Affiliate to terminate (i) the employment of an Employee
with or without notice and with or without cause, (ii) the
service of a Consultant pursuant to the terms of such
Consultant's agreement with the Company or an Affiliate or (iii)
the service of a Director pursuant to the Bylaws of the Company
or an Affiliate, and any applicable provisions of the corporate
law of the state in which the Company or the Affiliate is
incorporated, as the case may be.
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(c) INVESTMENT ASSURANCES. The Company may require an Optionholder,
as a condition of exercising or acquiring stock under any
Option, (i) to give written assurances satisfactory to the
Company as to the Optionholder's knowledge and experience in
financial and business matters and/or to employ a purchaser
representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters
and that he or she is capable of evaluating, alone or together
with the purchaser representative, the merits and risks of
exercising the Option; and (ii) to give written assurances
satisfactory to the Company stating that the Optionholder is
acquiring the stock subject to the Option for the Optionholder's
own account and not with any present intention of selling or
otherwise distributing the stock. The foregoing requirements,
and any assurances given pursuant to such requirements, shall be
inoperative if (iii) the issuance of the shares upon the
exercise or acquisition of stock under the Option has been
registered under a then currently effective registration
statement under the Securities Act or (iv) as to any particular
requirement, a determination is made by counsel for the Company
that such requirement need not be met in the circumstances under
the then applicable securities laws. The Company may, upon
advice of counsel to the Company, place legends on stock
certificates issued under the Plan as such counsel deems
necessary or appropriate in order to comply with applicable
securities laws, including, but not limited to, legends
restricting the transfer of the stock.
(d) WITHHOLDING OBLIGATIONS. The Optionholder may satisfy any
federal, state or local tax withholding obligation relating to
the exercise or acquisition of stock under an Option by any of
the following means (in addition to the Company's right to
withhold from any compensation paid to the Optionholder by the
Company) or by a combination of such means: (i) tendering a cash
payment; (ii) authorizing the Company to withhold shares from
the shares of the Common Stock otherwise issuable to the
Optionholder as a result of the exercise or acquisition of stock
under the Option; or (iii) delivering to the Company owned and
unencumbered shares of the Common Stock.
11. ADJUSTMENTS UPON CHANGES IN STOCK.
(a) CAPITALIZATION ADJUSTMENTS. If any change is made in the stock
subject to the Plan, or subject to any Option, without the
receipt of consideration by the Company (through merger,
consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than
cash, stock split, liquidating dividend, combination of shares,
exchange of shares, change in corporate structure or other
transaction not involving the receipt of consideration by the
Company), the Plan will be appropriately adjusted in the
class(es) and maximum number of securities subject both to the
Plan pursuant to subsection 4(a) and to the nondiscretionary
Options specified in Section 5, and the outstanding Options will
be appropriately adjusted in the class(es) and number of
securities and price per share of stock subject to such
outstanding Options. The
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Board shall make such adjustments, and its determination shall
be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a
transaction "without receipt of consideration" by the Company.)
12. AMENDMENT OF THE PLAN AND OPTIONS.
(a) AMENDMENT OF PLAN. The Board at any time, and from time to time,
may amend the Plan. However, except as provided in Section 11
relating to adjustments upon changes in stock, no amendment
shall be effective unless approved by the stockholders of the
Company to the extent stockholder approval is necessary to
satisfy the requirements of Rule 16b-3 or any Nasdaq or
securities exchange listing requirements.
(b) STOCKHOLDER APPROVAL. The Board may, in its sole discretion,
submit any other amendment to the Plan for stockholder approval.
(c) NO IMPAIRMENT OF RIGHTS. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of
the Plan unless (i) the Company requests the consent of the
Optionholder and (ii) the Optionholder consents in writing.
(d) AMENDMENT OF OPTIONS. The Board at any time, and from time to
time, may amend the terms of any one or more Options; provided,
however, that the rights under any Option shall not be impaired
by any such amendment unless (i) the Company requests the
consent of the Optionholder and (ii) the Optionholder consents
in writing.
13. TERMINATION OR SUSPENSION OF THE PLAN.
(a) PLAN TERM. The Board may suspend or terminate the Plan at any
time. Unless sooner terminated, the Plan shall terminate on the
day before the tenth (10th) anniversary of the date the Plan is
adopted by the Board or approved by the stockholders of the
Company, whichever is earlier. No Options may be granted under
the Plan while the Plan is suspended or after it is terminated.
(b) NO IMPAIRMENT OF RIGHTS. Suspension or termination of the Plan
shall not impair rights and obligations under any Option granted
while the Plan is in effect except with the written consent of
the Optionholder.
14. EFFECTIVE DATE OF PLAN.
The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the stockholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.
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15. CHOICE OF LAW.
All questions concerning the construction, validity and interpretation
of this Plan shall be governed by the law of the State of California, without
regard to such state's conflict of laws rules.
10.