Crown Jewel Resurces Corp. Stock Incentive Plan

CROWN JEWEL RESOURCES CORP.
STOCK INCENTIVE PLAN


Section 1.


PURPOSE


The purpose of this Plan is to promote the interests of the Company by providing the opportunity to purchase Shares or to receive compensation which is based upon appreciation in the value of Shares to Employees and Key Persons in order to attract and retain Employees and Key Persons by providing an incentive to work to increase the value of Shares and a stake in the future of the Company which corresponds to the stake of each of the Company's shareholders. The Plan provides for the grant of Incentive Stock Options, Non-Qualified Stock Options, Stock Awards and Stock Appreciation Rights to aid the Company in obtaining these goals.


Section 2.


DEFINITIONS


Each term set forth in this Section shall have the meaning set forth opposite such term for purposes of this Plan and, for purposes of such definitions, the singular shall include the plural and the plural shall include the singular, and reference to one gender shall include the other gender.


2.1 Board means the Board of Directors of the Company.


2.2 Code means the Internal Revenue Code of 1986, as amended.


2.3 Committee means the Compensation Committee of the Board.


2.4 Common Stock means the $.00005 par value per share common stock of the Company.


2.5 Company means Crown Jewel Resources Corp., a Delaware corporation, and any successor to such organization.


2.6 Director means a member of the Board.


2.7 Employee means an employee of the Company, a Subsidiary or a Parent.


2.8 Exchange Act means the Securities Exchange Act of 1934, as amended.


2.9 Exercise Price means the price which shall be paid to purchase one (1) Share upon the exercise of an Option granted under this Plan.


2.10 Fair Market Value of each Share on any date means the price determined below on the last business day immediately preceding the date of valuation:


(a) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the National


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Market of the National Association of Securities Dealers, Inc. Automated Quotation ("NASDAQ") System, its Fair Market Value per share shall be the closing sale price for the Common Stock (or the mean of the closing bid and asked prices, if no sales were reported), as quoted on such exchange or system on the date of such determination, as reported in The Wall Street Journal or such other source as the Board deems reliable; or


(b) If the Common Stock is not listed on any established stock exchange or a national market system, its Fair Market Value per share shall be the average of the closing dealer "bid" and "ask" prices of a share of the Common Stock as reflected on the NASDAQ interdealer quotation system of the National Association of Securities Dealers, Inc. on the date of such determination; or


(c) In the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the Board.


2.11 Insider means an individual who is, on the relevant date, an officer, director or ten percent (10%) beneficial owner of any class of the Company's equity securities that is registered pursuant to Section 12 of the Exchange Act, all as defined under Section 16 of the Exchange Act.


2.12 ISO means an option granted under this Plan to purchase Shares which is intended by the Company to satisfy the requirements of Code ss.422 as an incentive stock option.


2.13 Key Person means (i) a member of the Board who is not an Employee, (ii) a consultant, distributor or other person who has rendered or committed to render valuable services to the Company, a Subsidiary or a Parent, (iii) a person who has incurred, or is willing to incur, financial risk in the form of guaranteeing or acting as co-obligor with respect to debts or other obligations of the Company, or (iv) a person who has extended credit to the Company. Key Persons are not limited to individuals and, subject to the preceding definition, may include corporations, partnerships, associations and other entities.


2.14 Non-ISO means an option granted under this Plan to purchase Shares which is not intended by the Company to satisfy the requirements of Code ss.422.


2.15 Option means an ISO or a Non-ISO.


2.16 Outside Director means a member of the Board who is not an Employee and who qualifies as (1) "non-employee director" under Rule 16b-3(b)(3) under the 1934 Act, as amended from time to time, and (2) an "outside director" under Code ss.162(m) and the regulations promulgated thereunder.


2.17 Parent means any corporation which is a parent of the Company (within the meaning of Codess.424).


2.18 Participant means an individual who receives a Stock Incentive hereunder.


2.19 Performance-Based Exception means the performance-based exception from the tax deductibility limitations of Code ss.162(m).


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2.20 Plan means the Crown Jewel Resources Corp. Stock Incentive Plan, as amended from time to time.


2.21 Share means a share of the Common Stock of the Company.


2.22 Stock Incentive means an ISO, a Non-ISO, a Stock Award or a Stock Appreciation Right.


2.23 Stock Incentive Agreement means an agreement between the Company and a Participant evidencing an award of a Stock Incentive.


2.24 Subsidiary means any corporation which is a subsidiary of the Company (within the meaning of Codess.424(f)).


2.25 Surrendered Shares means the Shares described in Section 8.2 which (in lieu of being purchased) are surrendered for cash or Shares, or for a combination of cash and Shares, in accordance with Section 8.


2.26 Ten Percent Shareholder means a person who owns (after taking into account the attribution rules of Code ss.424(d)) more than ten percent (10%) of the total combined voting power of all classes of shares of either the Company, a Subsidiary or a Parent.


Section 3.


SHARES SUBJECT TO STOCK INCENTIVES


The total number of Shares that may be issued pursuant to Stock Incentives under this Plan shall not exceed Ten Million (10,000,000), as adjusted pursuant to Section 11. Such Shares shall be reserved, to the extent that the Company deems appropriate, from authorized but unissued Shares, and from Shares which have been reacquired by the Company. Furthermore, any Shares subject to a Stock Incentive which remain after the cancellation, expiration or exchange of such Stock Incentive thereafter shall again become available for use under this Plan, but any Surrendered Shares which remain after the surrender of an ISO or a Non-ISO under Section 8 shall not again become available for use under this Plan. Notwithstanding anything herein to the contrary, no Participant may be granted Options or Stock Appreciation Rights covering an aggregate number of Shares in excess of Five Million (5,000,000) in any calendar year.


Section 4.


EFFECTIVE DATE


The effective date of this Plan, as amended and restated herein, shall be the date it is adopted by the Board, provided the shareholders of the Company approve this Plan within twelve (12) months after such effective date. If such effective date comes before such shareholder approval, any Stock Incentives granted under this Plan before the date of such approval automatically shall be granted subject to such approval.


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Section 5.


ADMINISTRATION


5.1 General Administration. This Plan shall be administered by the Board. The Board, acting in its absolute discretion, shall exercise such powers and take such action as expressly called for under this Plan. The Board shall have the power to interpret this Plan and, subject to Section 13 to take such other action in the administration and operation of the Plan as it deems equitable under the circumstances. The Board's actions shall be binding on the Company, on each affected Employee or Key Person, and on each other person directly or indirectly affected by such actions.


5.2 Delegation of Authority. The Board may delegate its authority under the Plan, in whole or in part, to a Committee appointed by the Board consisting of not less than two (2) directors. The members of the Committee shall serve at the discretion of the Board. The Committee (if appointed) shall act according to the policies and procedures set forth in the Plan and to those policies and procedures established by the Board, and the Committee shall have such powers and responsibilities as are set forth by the Board. Reference to the Board in this Plan shall specifically include reference to the Committee where the Board has delegated it authority to the Committee, and any action by the Committee pursuant to a delegation of authority by the Board shall be deemed an action by the Board under the Plan. Notwithstanding the above, the Board may assume the powers and responsibilities granted to the Committee at any time, in whole or in part. With respect to Committee appointments and composition, only a Committee comprised solely of two (2) or more Outside Directors may grant Stock Incentives which will meet the Performance-Based Exception, and only a Committee comprised solely of Outside Directors may grant Stock Incentives to Insiders.


5.3 Decisions Binding. All determinations and decisions made by the Board (or its delegate) pursuant to the provisions of this Plan and all related orders and resolutions of the Board shall be final, conclusive and binding on all persons, including the Company, its stockholders, Directors, Employees, Key Persons, Participants, and their estates and beneficiaries.


Section 6.


ELIGIBILITY


Employees and Key Persons shall be eligible for the grant of Stock Incentives under this Plan, but no Employee shall have the right to be granted a Stock Incentive under this Plan merely as a result of his or her status as an Employee.


Section 7


TERMS OF STOCK INCENTIVES


7.1 Terms and Conditions of All Stock Incentives


(a) The Committee, in its absolute discretion, shall grant Stock Incentives under this Plan from time to time and shall have the right to grant new Stock Incentives in exchange for outstanding Stock Incentives. Stock Incentives shall be granted to Employees or Key Persons selected by the


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Committee, and the Committee shall be under no obligation whatsoever to grant Stock Incentives to all Employees or Key Persons, or to grant all Stock Incentives subject to the same terms and conditions.


(b) The number of Shares as to which a Stock Incentive shall be granted shall be determined by the Committee in its sole discretion, subject to the provisions of Section 3 as to the total number of shares available for grants under the Plan.


(c) Each Stock Incentive shall be evidenced by a Stock Incentive Agreement executed by the Company and the Participant, which shall be in such form and contain such terms and conditions as the Committee in its discretion may, subject to the provisions of the Plan, from time to time determine.


(d) The date a Stock Incentive is granted shall be the date on which the Committee has approved the terms and conditions of the Stock Incentive Agreement and has determined the recipient of the Stock Incentive and the number of Shares covered by the Stock Incentive and has taken all such other action necessary to complete the grant of the Stock Incentive. ...