DIY Legal Forms

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Adopting Stock Option Plan

WHEREAS, Adoption of an employee stock option plan will enable key employees to acquire stock in the corporation (Corporation) and thereby increase their involvement in Corporation's financial success and the plan will provide an incentive for key employees to remain in Corporation's employ, all to the benefit of Corporation, it is resolved that:

1. Adoption of Plan. An Employee Stock Option Plan (Plan) for the benefit of Corporation's key employees be, and hereby is, adopted.

2. Administration by Board. The Plan shall be administered by the Board of Directors. The Board shall be the sole determinant of which key employees may participate in the Plan, how many shares each participant may purchase, the price to be paid for the shares, the terms of payment, the option period, and any interpretations of the Plan's intent and operation. In administering the Plan, the vote of a majority of the Directors voting, provided they constitute a quorum under Corporation's Bylaws, shall be conclusive.

3. Availability of Shares. A total of [number] shares of Corporation's common stock shall be available to the Plan. These shares may come from authorized but unissued shares and from issued and reacquired shares, including shares issued in accordance with the Plan and reacquired by Corporation subject to any restrictions placed on them by the Board of Directors in accordance with the terms of the Plan or the Stock Option Agreement described below. The total number of shares available for Plan purposes shall be adjusted to account for stock splits, stock dividends, reverse stock splits, granting of warrants, and the like.

4. Stock Option Agreement. Any stock option granted in accordance with the Plan shall be granted only upon the execution of the Stock Option Agreement [omitted] attached to this Resolution, by both the key employee and Corporation. The terms and conditions of the Agreement may be changed by the Board of Directors at any time, but these changes shall not affect Agreements in force at the time the changes are made.

5. Directors Not Eligible. None of the members of the Board of Directors may participate in the Plan unless the Director is also an employee of Corporation. A member of the Board cannot take part in any discussion or vote to determine whether the member should be invited to participate in the Plan.

6. Restrictions on Shares. The Board may place any restrictions it chooses on the ability of the holder of any shares issued under the Plan to sell or otherwise transfer them including those restrictions that it may deem necessary to comply with the Securities and Exchange Commission, and any applicable state securities law.

7. Amendments to Plan. Except for the total number of shares available to the Plan, the Board of Directors may amend the terms and conditions of the Plan at any time.

8. Plan Termination. The Board of Directors may determine the date on which the Plan shall end. The Plan's termination shall not affect any Stock Option Agreements in force on the termination date or any restrictions placed on shares issued in accordance with the Plan.