AERA 8-K
AI Era Corp. (AERA)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event
reported):
(Exact name of registrant as specified in its charter)
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Registrant’s telephone number, including area code:
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______________________ (Former name or former address, if changed since last report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act: None
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Resignation of Chief Executive Officer
On March 1, 2026, the Board of Directors (the “Board”) of AI Era Corp. (the “Company”) accepted the resignation of Chiyuan Deng (also known as Fred Deng) as Chief Executive Officer of the Company, effective as of the close of business on March 1, 2026.
Mr. Deng’s resignation was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies, or practices. Mr. Deng will continue to serve as President and Chief Financial Officer (or in such other capacity as determined by the Board) and remains a director.
Appointment of New Chief Executive Officer
Effective March 1, 2026, the Board appointed Ahmad Moradi as Chief Executive Officer of the Company, to serve until his successor is appointed or until his earlier resignation or removal. There are no family relationships between Mr. Moradi and any director or executive officer of the Company, and, aside from the below Employment Agreement, there are no transactions involving Mr. Moradi that would require disclosure under Item 404(a) of Regulation S-K.
Mr. Moradi has extensive experience in AI technologies, strategic partnerships, and business development, as evidenced by his background (including but not limited to information available at amoradi.com). Over more than 25 years, Mr. Moradi has held leadership roles including Chairman, President, and/or CEO in the following entities:
| • | MAXWELL RAND (FL C Corp): Chairman, President, CEO (1996 MN – 2001 FL; Private, 100% owned by Mr. Moradi); | ||
| • | G4 Inc. (FL C Corp): Chairman, President, CEO (1992; Private, 90% owned by Mr. Moradi); | ||
| • | NETSTAIRS.COM, INC. (FL C Corp): Chairman, President, CEO (March 2005 – present; Private, 100% owned by Mr. Moradi); | ||
| • | VYPA Corporation (FL C Corp): Chairman, Chief Science Officer (March 2005 – present; Private, approximately 650 shareholders); | ||
| • | AITV Technologies INC. (Delaware C Corp): Chairman, Interim CEO, Treasurer, Secretary (February 2025 – present; Private, 5 stockholders); | ||
| • | INVESTROOM.AI (FL C Corp): Chairman, President, CEO (2021 – present; Private, 100% owned by Mr. Moradi); | ||
| • | WEBDOCTOR.AI (FL C Corp): Chairman, President, CEO (2018 – present; Private, 100% owned by Mr. Moradi); | ||
| • | MAXWELL RAND of Puerto Rico Inc. (Puerto Rico): Chairman, President, CEO (2018 – present; Private, 100% owned by Mr. Moradi); | ||
| • | NETSTAIRS INC. (Puerto Rico): Chairman, President, CEO (2018 – present; Private, 100% owned by Mr. Moradi); and | ||
| • | METAXCHNAGE.AI INC. (FL C Corp): Chairman, President, CEO (2018 – present; 38% control, approximately 660 shareholders) |
Mr. Moradi currently serves on boards and is engaged with a Nasdaq Private Market-listed company.
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Employment Agreement with Ahmad Moradi
In connection with Mr. Moradi’s appointment, the Company entered into an Employment Agreement dated March 1, 2026 (the “Employment Agreement”) with Mr. Moradi. The Employment Agreement has an initial three-year term (with automatic one-year renewals unless notice of non-renewal is given 90 days prior) and provides for the following material terms (among others):
| • | A one-time sign-on bonus of $500,000 payable in shares of the Company's Common Stock (calculated based on a per-share price of $0.80 to $1.00, mutually agreed at execution). | ||
| • | An annual base salary of $144,000 (payable quarterly, at least 50% in cash), plus a $30,000 annual remote work stipend. | ||
| • | A grant of 2,000,000 stock options under the Company's 2026 equity incentive plan, vesting over three years (25%/35%/40%) subject to continued employment and performance milestones, with full acceleration upon a change of control or termination without cause. | ||
| • | Eligibility for performance-based incentives of up to 1,250,000+ additional shares tied to revenue growth, partnerships, and KPIs (to be set within 90 days). | ||
| • | Standard executive benefits and expense reimbursements. | ||
| • | Customary restrictive covenants including confidentiality (indefinite), 12-month non-competition and non-solicitation in the AI-driven media and entertainment sector (U.S.-wide), and mutual non-disparagement; excludes pre-existing activities and includes a right of first refusal/acceptance on certain AI media-related opportunities. | ||
| • | Severance protections (150% of remaining base salary, full option vesting, benefits continuation, IP royalties, and consulting payments) upon termination without cause, for good reason, or change of control. |
The foregoing description of the Employment Agreement is qualified in its entirety by reference to the full text of the Employment Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Appointment of President and Employment Agreement with Chiyuan Deng
Effective March 1, 2026, in connection with the CEO transition and to formalize his ongoing executive role, the Board appointed (or re-designated) Chiyuan Deng as President of the Company.
In connection therewith, the Company entered into an Employment Agreement dated March 1, 2026 (the “Deng Employment Agreement”) with Mr. Deng. The Deng Employment Agreement has an initial three-year term (with automatic one-year renewals unless notice of non-renewal is given 90 days prior) and provides for the following material terms (among others):
| • | A one-time sign-on bonus of $300,000 payable in shares of the Company's Common Stock (calculated based on a per-share price of $0.80 to $1.00, mutually agreed at execution). | ||
| • | An annual base salary of $144,000 (payable quarterly, at least 50% in cash), plus a $30,000 annual remote work stipend. | ||
| • | A grant of 1,500,000 stock options under the Company's equity incentive plan, vesting over three years (25%/35%/40%) subject to continued employment and performance milestones, with full acceleration upon a change of control or termination without cause. | ||
| • | Eligibility for performance-based incentives of up to 750,000+ additional shares tied to revenue growth, partnerships, and KPIs (to be set within 90 days). | ||
| • | Standard executive benefits and expense reimbursements. | ||
| • | Customary restrictive covenants including confidentiality (indefinite), 12-month non-competition and non-solicitation in the AI-driven media and entertainment sector (U.S.-wide), and mutual non-disparagement; excludes pre-existing activities. | ||
| • | Severance protections (125% of remaining base salary, full option vesting, benefits continuation, and consulting payments) upon termination without cause, for good reason, or change of control. |
The foregoing description of the Deng Employment Agreement is qualified in its entirety by reference to the full text of the Deng Employment Agreement, which is filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
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Adoption of 2026 Incentive Plan
On March 1, 2026, the Board adopted the AI Era Corp. 2026 Incentive Plan (the “2026 Incentive Plan”), which provides for the grant of stock options, restricted stock, restricted stock units, performance shares, stock appreciation rights, and other equity-based awards to eligible employees, officers, directors, consultants, and other service providers of the Company and its Related Companies. The 2026 Incentive Plan reserves a maximum of 10,000,000 shares of Common Stock for issuance thereunder (subject to adjustment as provided in the Plan). The adoption of the 2026 Incentive Plan is intended to support the Company’s executive and employee compensation arrangements (including those referenced in the Moradi Employment Agreement and Deng Employment Agreement), future hiring, and long-term growth objectives while managing dilution consistent with best practices for micro-cap public companies.
The foregoing description of the 2026 Incentive Plan is qualified in its entirety by reference to the full text of the 2026 Incentive Plan, which is filed as Exhibit 10.3 to this Current Report on Form 8-K and incorporated herein by reference.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description |
| 10.1 | Employment Agreement dated March 1, 2026, between AI Era Corp. and Ahmad Moradi |
| 10.2 | Employment Agreement dated March 1, 2026, between AI Era Corp. and Chiyuan Deng |
| 10.3 | AI Era Corp. 2026 Equity Incentive Plan |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
AI Era Corp.
/s/ Chiyuan Deng
Chiyuan Deng
President
Date: March 2, 2026
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AI ERA CORP EMPLOYMENT AGREEMENT
This Employment Agreement (this “Agreement”) is entered into as of March 1, 2026 (the “Effective Date”), by and between AI Era Corp., a Nevada corporation (the “Company”), and Ahmad Moradi, an individual (the “Executive”).
RECITALS
WHEREAS, the Company desires to employ the Executive as its Chief Executive Officer, and the Executive desires to accept such employment, on the terms and conditions set forth herein;
WHEREAS, the Executive possesses extensive experience in AI technologies, strategic partnerships, and business development, as evidenced by his background (including but not limited to information available at amoradi.com); and
WHEREAS, the parties intend for this Agreement to govern the terms of the Executive’s employment for a period of three years, subject to renewal, with a focus on U.S. operations, growth, and integration of the Executive's expertise.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Employment and Duties
1.1 Position. The Company hereby employs the Executive as its Chief Executive Officer (the “CEO”), and the Executive hereby accepts such employment. The Executive shall report directly to the Company’s Chairman, Chiyuan Deng.
1.2 Duties. During the Term (as defined below), the Executive shall devote the necessary time, attention, and best efforts to the performance of his duties hereunder (except for permitted outside activities as set forth in Section 1.4), which shall include, but not be limited to:
- Providing strategic leadership and execution of the Company's Global growth initiatives;
- Driving licensing revenue agreements, partnerships, and technology monetization strategies within the Global market;
- Leading investor relations, strategic funding, and revenue optimization plans;
- Building and leading a U.S.-based operational team, including recruiting at least 3-5 key personnel in the first year (e.g., in operations and business development);
- Reporting quarterly to the Chairman on performance, key milestones, and progress; and
- Such other duties as may be reasonably assigned by the Chairman or the Board of Directors of the Company (the “Board”) consistent with the Executive's position as a senior executive officer.
This is a results-oriented position and shall not be construed as full-time employment requiring exclusive devotion of the Executive’s business time. The Executive’s performance shall be measured by results achieved rather than hours worked.
Immediately upon the Effective Date, the Executive shall assume a key role in AERA’s NASDAQ Global Market uplisting/IPO efforts, including leading strategic funding initiatives and investor relations activities to support the Company’s transition to a national exchange listing.
1.3 Location. The Executive's primary place of employment shall be remote, with travel as reasonably necessary for business purposes. The Company shall provide a remote work stipend as set forth in Section 3.2.2.
1.4 Outside Activities. The Executive has, for over 45 years, been engaged in outside activities, including serving as CEO of public and private companies, managing an investment banking portfolio firm, running and innovating technology-based companies and new startups, and serving on several companies’ boards or performing charitable work. The Executive is currently serving a Nasdaq Private Market-listed company and has been engaged in such activities prior to this Agreement. The Executive may continue these existing activities and engage in future outside activities (including new commitments), provided that such activities do not create an actual or apparent conflict of interest with the Company's business (including but not limited to competing with the Company's AI-driven media and entertainment sector), materially interfere with the Executive's performance of duties under this Agreement, or violate any applicable Company policy. For any new or materially changed commitments after the Effective Date, the Executive shall provide prior written notice to the Board at the Executive's discretion as to timing and detail. Such notice shall enable the Board to assess potential conflicts; however, approval shall not be unreasonably withheld unless a direct, material conflict exists (as reasonably determined by the Board in writing).
2. Term
The term of the Executive’s employment hereunder shall commence on the Effective Date and continue for a period of three (3) years (the “Initial Term”), unless earlier terminated pursuant to Section 5. The Initial Term shall automatically renew for successive one (1) year periods unless either party provides written notice of non-renewal at least ninety (90) days before the expiration of the then-current term. The Initial Term and any renewal periods are collectively referred to as the “Term.”
3. Compensation and Benefits
3.1 Sign-On Bonus. Upon execution of this Agreement, the Executive shall receive a one-time sign-on bonus of $500,000, payable in shares of the Company's Common Stock (the “Sign-On Shares”). The number of Sign-On Shares shall be calculated by dividing $500,000 by a fixed per-share price in the range of $0.80 to $1.00 (determined at the Effective Date by mutual agreement of the parties within that range, with a target midpoint of $0.90 per share for illustrative purposes). Such shares shall be issued pursuant to a Form S-8 registration statement filed by the Company or another applicable exemption from registration.
The Sign-On Shares shall be subject to clawback (in whole or in part, as determined by the Board) if the Executive is terminated for Cause (as defined in Section 5.2) within the first twelve (12) months of the Term. Prior to any clawback, the Company shall provide written notice specifying the grounds for Cause in reasonable detail. If the grounds are curable (e.g., material breach or repeated failure to perform), the Executive shall have sixty (60) days from receipt of notice to cure the issue to the reasonable satisfaction of the Board. If not cured (or if non-curable, such as felony conviction or willful gross misconduct), clawback may be enforced.
Within ninety (90) days of the Effective Date, the parties shall negotiate in good faith to supplement this Agreement with a detailed schedule of clawback triggers and amounts (the “Clawback Schedule”), which shall be mutually agreed and attached hereto as Exhibit A. If no such schedule is agreed upon, the clawback provisions in Section 3.1 shall remain in full force and effect as written.
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3.2 Base Salary. The Executive shall receive a fixed annual base salary of $144,000 (the “Base Salary”), payable quarterly in arrears in a mix of cash and shares of Common Stock, at the Company’s discretion (provided that at least 50% shall be in cash unless otherwise agreed in writing). The Base Salary shall be subject to annual review by the Board for potential increases but not decreases (except for across-the-board reductions of no more than 10% affecting all senior executives). In addition, the Executive shall receive an annual remote work stipend of $30,000, payable quarterly, to cover home office expenses and related costs, subject to submission of reasonable documentation.
3.3 Stock Options. The Executive shall be granted 2,000,000 stock options to purchase shares of Common Stock (the “Options”) under the Company's equity incentive plan (the "Plan"), with an exercise price equal to the fair market value on the grant date and a term of seven years. The Options shall vest as follows: 25% after the first year of the Term, 35% after the second year, and 40% after the third year, subject to the Executive's continued employment and achievement of performance milestones as determined by the Board. Vesting shall accelerate in full upon a Change of Control (as defined in Section 5.4) or termination without Cause (as defined in Section 5.2), but unvested Options shall forfeit upon termination for Cause. All Options are subject to the terms of the Plan, including any clawback provisions required by applicable law (e.g., Dodd-Frank Act).
3.4 Performance Incentives. The Executive shall be eligible for additional performance-based bonuses in the form of shares of Common Stock, as follows:
- 500,000 shares upon achievement of specified revenue growth targets (percentage growth year-over-year, as determined by the Board);
- 500,000 shares upon achievement of strategic partnerships or licensing revenue thresholds (as determined by the Board);
- Up to 250,000 shares per quarter upon achievement of Board-approved key performance indicators (KPIs), including but not limited to U.S. team building.
The specific targets and KPIs shall be established by the Board in consultation with the Executive within ninety (90) days of the Effective Date and reviewed annually. All performance incentives are subject to clawback if based on materially inaccurate financial statements or in cases of Executive misconduct (including but not limited to fraud, gross negligence, willful violation of law, or material breach of this Agreement), per Company policy and applicable law.
3.5 Annual Bonuses. he Executive shall be eligible for annual bonuses based on earnings per share (EPS) and share price growth, with targets and amounts determined by the Board in its sole discretion. Bonuses shall be paid no later than 2.5 months after fiscal year-end, subject to the Executive's continued employment through the payment date (except in cases of termination without Cause or for Good Reason).
3.6 Benefits. The Executive shall be entitled to participate in all employee benefit plans maintained by the Company for its executive employees on terms no less favorable than those provided to other senior executives, including but not limited to health insurance (with a stipend provided if not Company-sponsored) and retirement contribution matching (up to 5% of Base Salary, to be determined by the Board). The Executive shall also be entitled to reimbursement of pre-approved business expenses in accordance with Company policy, up to an annual allowance of $60,000 via a corporate credit card, subject to documentation and audit. All benefits are subject to the terms of the applicable plans and may be modified by the Company for all participants.
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4. Confidentiality, Non-Competition, and Non-Solicitation
4.1 Confidentiality. During the Term and indefinitely thereafter, the Executive shall not disclose, use, or permit others to use any Confidential Information except as required for the performance of his duties or as required by law (with prior notice to the Company). “Confidential Information” includes all non-public information regarding the Company's business, operations, IP, finances, or strategies. Upon termination, the Executive shall promptly return or destroy all Confidential Information and certify compliance.
4.2 Intellectual Property.
(a) Assignment of Intellectual Property. The Executive hereby assigns to the Company all right, title, and interest in and to any inventions, discoveries, improvements, works of authorship, software, know-how, trade secrets, and other intellectual property (collectively, “Inventions”) that are created, conceived, developed, or reduced to practice by the Executive, solely or jointly with others, (i) during the Term, (ii) in connection with the Executive’s duties or employment hereunder, or (iii) using the Company’s resources, facilities, equipment, or Confidential Information. This assignment excludes any pre-existing intellectual property or Inventions of the Executive developed prior to the Effective Date or independently outside the scope of this Agreement, including but not limited to those associated with NETSTAIRS.COM, Inc. and its iCDN platform.
(b) Right of First Refusal for AI Media Opportunities. In recognition of the Executive’s extensive experience in AI technologies, interactive streaming, content delivery networks, and related media/entertainment solutions (including through NETSTAIRS and its Interactive Content Delivery Network (“iCDN”)), the Executive agrees that, during the Term, if the Executive identifies, develops, or has presented to him any new business opportunity, project, technology development, partnership, licensing deal, or work-in-progress (each, an “AI Media Opportunity”) that is directly related to AI-driven media, streaming, interactive video, content delivery, real-time communications (e.g., WebRTC integration), or AI-enhanced entertainment/media delivery (collectively, “AI Media Field”), and such AI Media Opportunity could reasonably be pursued by or benefit the Company, then: (i) The Executive shall promptly disclose such AI Media Opportunity in reasonable detail to the Company (via written notice to the Chairman or Board); and (ii) The Company shall have a right of first refusal to pursue or participate in such AI Media Opportunity on terms no less favorable than those offered to or available from any third party. The Company shall have thirty (30) days from receipt of such notice to elect in writing to exercise this right (or such longer period as mutually agreed if diligence is required). If the Company declines or fails to respond within the period, the Executive may pursue the AI Media Opportunity independently or through his other entities (including NETSTAIRS), provided it does not materially interfere with his duties hereunder or create an actual conflict under Section 1.4.
4.3 Non-Competition. During the Term and for twelve (12) months thereafter (or the maximum enforceable period under applicable law), the Executive shall not, directly or indirectly, engage in, own, or provide services to any business that competes with the Company's AI-driven media and entertainment sector within the United States. The Company may enforce this through injunctive relief.
4.4 Non-Solicitation and Non-Disparagement. During the Term and for twelve (12) months thereafter, the Executive shall not solicit any Company employees, customers, or business partners for competitive purposes, nor make any disparaging statements about the Company, its officers, directors, or affiliates. The Company shall reciprocate non-disparagement.
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4.5 Return of Property. Upon termination, the Executive shall immediately return all Company property, including documents, devices, and access credentials.
4.6 Enforceability. If any restrictive covenant is held unenforceable, it shall be reformed to the maximum enforceable extent. The Executive acknowledges these restrictions are reasonable to protect the Company's legitimate interests.
5. Termination
5.1 Termination Events. The Executive's employment may be terminated as follows:
§ By mutual written agreement;
§ By the Company for Cause upon written notice;
§ By the Company without Cause upon thirty (30) days' written notice;
§ By the Executive for Good Reason upon thirty (30) days' written notice;
§ By the Executive without Good Reason upon sixty (60) days' written notice;
§ Upon the Executive's death or Disability.
5.2 Cause. “Cause” means: (i) conviction of (or plea of guilty or no contest to) a felony or crime involving moral turpitude; (ii) willful gross misconduct or fraud materially injurious to the Company (financially or reputationally); (iii) material breach of this Agreement (including willful violation of Sections 4.1, 4.3, or 4.4); or (iv) repeated and material failure to perform duties after written notice from the Company (or Board) specifying the deficiencies in reasonable detail and, for curable failures, a sixty (60) day cure period following such notice, during which the Executive fails to cure to the reasonable satisfaction of the Board. Termination for Cause shall require approval by a majority of the Board (excluding the Executive if a member), after providing the Executive a reasonable opportunity to be heard (in person or via representative). Non-curable acts (e.g., felony conviction, willful fraud) require no cure period.
5.3 Good Reason. “Good Reason” means: (i) material reduction in duties or compensation without consent; (ii) relocation of primary work location by more than 50 miles; or (iii) material breach by the Company, subject to notice and cure.
5.4 Severance Clause. If terminated without Cause or for Good Reason, or upon a Change of Control (defined as a sale of all or substantially all assets, a merger resulting in loss of control, or acquisition of 50%+ voting power), the Executive shall receive:
- Severance equals to 150% of remaining Base Salary for the Term.
- Immediate vesting of all unvested Options;
- Continuation of benefits for six (6) months;
- Ongoing royalties from the Executive's licensed IP for the remainder of the Term plus two (2) years (terms as per IP Licensing Agreement);
- Six (6) months of consulting at $25,000 per month.
5.5 Payments Upon Termination. Upon termination for Cause, death, or Disability, the Executive shall receive accrued but unpaid Base Salary and vested benefits only.
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6. Miscellaneous
6.1 Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the internal laws of the State of Nevada, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. The parties irrevocably submit to the exclusive jurisdiction of the state and federal courts located in Clark County, Nevada (or, if no federal jurisdiction exists, the state courts of Nevada in Clark County), for any action or proceeding arising out of or relating to this Agreement (except for arbitration proceedings as provided in Section 6.2), and hereby waive any objection to venue in such courts based on forum non conveniens or any other ground. Each party hereby waives any right to a jury trial in connection with any such action or proceeding.
6.2 Arbitration. Any dispute, controversy, or claim arising out of or relating to this Agreement, including its formation, validity, breach, termination, or interpretation, or the Executive’s employment relationship with the Company (each, a “Claim”), shall be finally settled by binding arbitration administered by the American Arbitration Association (“AAA”) in accordance with its Employment Arbitration Rules then in effect (the “Rules”). The arbitration shall be conducted in Las Vegas, Nevada (or, if mutually agreed in writing by the parties, New York, New York), by a single arbitrator selected in accordance with the Rules. The arbitrator shall be a licensed attorney with at least ten (10) years of experience in employment law, executive compensation, and corporate governance matters. The language of the arbitration shall be English. The arbitrator shall have the authority to grant any equitable relief (including preliminary and permanent injunctive relief) that a court could award, and the award shall be final and binding, with no right of appeal except as provided by applicable law. The prevailing party in any arbitration or related court proceeding shall be entitled to recover its reasonable attorneys’ fees, costs, and expenses incurred in connection therewith. Judgment on the award may be entered in any court having jurisdiction thereof. Notwithstanding the foregoing, either party may seek provisional injunctive relief (including temporary restraining orders or preliminary injunctions) in any court of competent jurisdiction to prevent irreparable harm pending the outcome of arbitration, without waiving the right to arbitration on the merits. The parties agree that any such injunctive relief action shall be brought exclusively in the state or federal courts located in Clark County, Nevada.
6.3 Entire Agreement. This Agreement, together with the Intellectual Property Licensing Agreement executed concurrently herewith and any exhibits, schedules, or appendices attached hereto or thereto, constitutes the entire understanding and agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous understandings, agreements, representations, warranties, and negotiations, whether oral or written, relating to such subject matter. Each party acknowledges that, in entering into this Agreement, it has not relied on any statement, representation, warranty, or understanding not expressly set forth herein.
6.4 Amendments; Waivers. No amendment, modification, supplement, or waiver of any provision of this Agreement shall be effective unless in writing and signed by an authorized representative of each party. No waiver by either party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. No course of dealing or failure to insist upon strict adherence to any term of this Agreement shall constitute a waiver of such term.
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6.5 Assignment. Neither party may assign, delegate, or otherwise transfer this Agreement or any of its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld, conditioned, or delayed; provided, however, that the Company may assign this Agreement without the Executive’s consent (i) to any Affiliate, or (ii) in connection with a merger, consolidation, reorganization, sale of all or substantially all of its assets, or other similar transaction involving the Company or its business, provided that the assignee assumes in writing all of the Company’s obligations hereunder and provides written notice to the Executive within ten (10) business days after such assignment. Any purported assignment in violation of this Section shall be null and void ab initio.
6.6 Severability. If any provision of this Agreement is held to be illegal, invalid, or unenforceable under present or future laws effective during the Term, such provision shall be fully severable. The remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid, or unenforceable provision, there shall be added automatically as part of this Agreement a provision as similar in terms to such illegal, invalid, or unenforceable provision as may be possible and be legal, valid, and enforceable.
6.7 Waiver. No waiver of any term or condition of this Agreement shall be valid unless in writing and signed by the waiving party. The failure or delay of either party to exercise or enforce any right, power, or remedy under this Agreement shall not constitute a waiver thereof, nor shall any single or partial exercise preclude any other or further exercise of such right, power, or remedy or the exercise of any other right, power, or remedy.6.8 Notices. All notices, requests, consents, claims, demands, waivers, and other communications hereunder (each, a “Notice”) shall be in writing and addressed to the parties at the addresses set forth below (or to such other address that may be designated by the receiving party from time to time in accordance with this Section). All Notices shall be delivered by personal delivery, nationally recognized overnight courier (with all fees prepaid), facsimile or email (with confirmation of transmission) or certified or registered mail (in each case, return receipt requested, postage prepaid). Notice is effective upon receipt by the receiving party, and if the party giving the Notice has complied with the requirements of this Section. Notwithstanding the foregoing, routine business communications (not constituting formal Notices under this Agreement) may be sent by email without confirmation of receipt.
If to the Company:
AI Era Corp.
144 Main Street
Mt. Kisco, NY 10549
Attention: Chiyuan Deng
Email: [email protected]
If to the Executive:
Ahmad Moradi
3032 East Commercial Blvd.
No 82
Fort Lauderdale, FL. 333308 USA
Email: [email protected]
6.9 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile, email (including pdf or other electronic format), or other electronic means shall be effective as delivery of a manually executed counterpart of this Agreement. This Agreement shall be deemed executed when each party has delivered a signed counterpart (whether original, facsimile, or electronic) to the other party.
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6.10 Force Majeure. Neither party shall be liable or responsible to the other party, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement (except for any obligations to make payments hereunder), when and to the extent such failure or delay is caused by or results from acts beyond the impacted party’s reasonable control, including, without limitation, the following force majeure events (“Force Majeure Event(s)”): acts of God; flood, fire, earthquake, explosion, or other natural disaster; war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; government order, law, or action; embargoes or blockades in effect on or after the date of this Agreement; action by any governmental authority; national or regional emergency; strikes, labor stoppages or slowdowns, or other industrial disturbances; shortage of adequate power or transportation facilities; and other similar events beyond the reasonable control of the impacted party. The impacted party shall give notice within five (5) business days of the Force Majeure Event to the other party, describing the Force Majeure Event and its impact, and shall use commercially reasonable efforts to end the failure or delay and ensure the effects of such Force Majeure Event are minimized. If a Force Majeure Event prevents performance for a continuous period of more than ninety (90) days, either party may terminate this Agreement upon written notice to the other party.
6.11 Further Assurances. Each party agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be reasonably necessary or appropriate to effectuate, carry out, and perform all of the terms, provisions, and conditions of this Agreement and all transactions contemplated hereby.
6.12 No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.
6.13 Interpretation. The parties acknowledge that this Agreement was negotiated at arm’s length with the benefit of legal counsel for each party. Accordingly, no rule of strict construction or interpretation against the drafter shall apply to this Agreement or any provision hereof.
6.14 Headings. The headings in this Agreement are for convenience only and shall not be used in the interpretation of this Agreement.
6.15 Independent Contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture, or other form of joint enterprise, employment relationship beyond that expressly set forth herein, or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever.
6.16 Publicity. Neither party shall issue any press release or make any other public announcement or disclosure regarding this Agreement or the transactions contemplated hereby without the prior written consent of the other party (not to be unreasonably withheld), except as required by applicable law, regulation, or stock exchange rules, in which case the disclosing party shall provide the other party with a reasonable opportunity to review and comment on the disclosure prior to issuance.
6.17 Survival. The provisions of Sections 4 (Confidentiality, Intellectual Property, Non-Competition, and Non-Solicitation), 5.5 (Payments Upon Termination), 6.1 (Governing Law), 6.2 (Arbitration), 6.3 (Entire Agreement), 6.6 (Severability), 6.7 (Waiver), 6.8 (Notices), and 6.16 (Publicity) shall survive any termination or expiration of this Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.
AI Era Corp.
(the Company)
By: /s/ Chiyuan Deng
Chiyuan Deng
President
/s/ Ahmad Moradi
Ahmad Moradi
(the Executive)
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AI ERA CORP EMPLOYMENT AGREEMENT
This Employment Agreement (this “Agreement”) is entered into as of March 1, 2026 (the “Effective Date”), by and between AI Era Corp., a Nevada corporation (the “Company”), and Chiyuan Deng, an individual (the “Executive”).
RECITALS
WHEREAS, the Company desires to employ the Executive as its President, and the Executive desires to accept such employment, on the terms and conditions set forth herein;
WHEREAS, the Executive possesses extensive experience in financial management, corporate finance, compliance, and strategic operations, as evidenced by his background; and
WHEREAS, the parties intend for this Agreement to govern the terms of the Executive’s employment for a period of three years, subject to renewal, with a focus on operations, financial oversight, and integration of the Executive's expertise.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Employment and Duties
1.1 Position. The Company hereby employs the Executive as its President, and the Executive hereby accepts such employment. The Executive shall also serve as a member of the Board of Directors of the Company (the “Board”) during the Term, subject to election and applicable governance requirements.
1.2 Duties. During the Term (as defined below), the Executive shall devote the necessary time, attention, and best efforts to the performance of his duties hereunder (except for permitted outside activities as set forth in Section 1.4), which shall include, but not be limited to:
§ Providing financial leadership and oversight of the Company's global financial operations, including budgeting, forecasting, and compliance;
§ Managing SEC filings, financial reporting, and audit processes to support regulatory compliance and transparency;
§ Driving financial strategies for growth, including capital raising, investor relations, and optimization of revenue streams;
§ Overseeing U.S.-based financial and operational teams, including recruiting key personnel in finance and operations;
§ Reporting quarterly to the Board on financial performance, key milestones, and progress; and
§ Such other duties as may be reasonably assigned by the Chairman, or the Board consistent with the Executive's position as a senior executive officer.
This is a results-oriented position and shall not be construed as full-time employment requiring exclusive devotion of the Executive’s business time. The Executive’s performance shall be measured by results achieved rather than hours worked.
Immediately upon the Effective Date, the Executive shall assume a key role in AERA’s NASDAQ Global Market uplisting/IPO efforts, including leading strategic funding initiatives and investor relations activities to support the Company’s transition to a national exchange listing.
1.3 Location. The Executive's primary place of employment shall be remote, with travel as reasonably necessary for business purposes. The Company shall provide a remote work stipend as set forth in Section 3.2.2.
1.4 Outside Activities. The Executive may engage in outside activities (including new commitments), provided that such activities do not create an actual or apparent conflict of interest with the Company's business (including but not limited to competing with the Company's AI-driven media and entertainment sector), materially interfere with the Executive's performance of duties under this Agreement, or violate any applicable Company policy. For any new or materially changed commitments after the Effective Date, the Executive shall provide prior written notice to the Board at the Executive's discretion as to timing and detail. Such notice shall enable the Board to assess potential conflicts; however, approval shall not be unreasonably withheld unless a direct, material conflict exists (as reasonably determined by the Board in writing).
2. Term
The term of the Executive’s employment hereunder shall commence on the Effective Date and continue for a period of three (3) years (the “Initial Term”), unless earlier terminated pursuant to Section 5. The Initial Term shall automatically renew for successive one (1) year periods unless either party provides written notice of non-renewal at least ninety (90) days before the expiration of the then-current term. The Initial Term and any renewal periods are collectively referred to as the “Term.”
3. Compensation and Benefits
3.1 Sign-On Bonus. Upon execution of this Agreement, the Executive shall receive a one-time sign-on bonus of $300,000, payable in shares of the Company's Common Stock (the “Sign-On Shares”). The number of Sign-On Shares shall be calculated by dividing $300,000 by a fixed per-share price in the range of $0.80 to $1.00 (determined at the Effective Date by mutual agreement of the parties within that range, with a target midpoint of $0.90 per share for illustrative purposes). Such shares shall be issued pursuant to a Form S-8 registration statement filed by the Company or another applicable exemption from registration.
The Sign-On Shares shall be subject to clawback (in whole or in part, as determined by the Board) if the Executive is terminated for Cause (as defined in Section 5.2) within the first twelve (12) months of the Term. Prior to any clawback, the Company shall provide written notice specifying the grounds for Cause in reasonable detail. If the grounds are curable (e.g., material breach or repeated failure to perform), the Executive shall have sixty (60) days from receipt of notice to cure the issue to the reasonable satisfaction of the Board. If not cured (or if non-curable, such as felony conviction or willful gross misconduct), clawback may be enforced.
Within ninety (90) days of the Effective Date, the parties shall negotiate in good faith to supplement this Agreement with a detailed schedule of clawback triggers and amounts (the “Clawback Schedule”), which shall be mutually agreed and attached hereto as Exhibit A. If no such schedule is agreed upon, the clawback provisions in Section 3.1 shall remain in full force and effect as written.
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3.2 Base Salary. The Executive shall receive a fixed annual base salary of $144,000 (the “Base Salary”), payable quarterly in arrears in a mix of cash and shares of Common Stock, at the Company’s discretion (provided that at least 50% shall be in cash unless otherwise agreed in writing). The Base Salary shall be subject to annual review by the Board for potential increases but not decreases (except for across-the-board reductions of no more than 10% affecting all senior executives). In addition, the Executive shall receive an annual remote work stipend of $30,000, payable quarterly, to cover home office expenses and related costs, subject to submission of reasonable documentation.
3.3 Stock Options. The Executive shall be granted 1,500,000 stock options to purchase shares of Common Stock (the “Options”) under the Company's equity incentive plan (the "Plan"), with an exercise price equal to the fair market value on the grant date and a term of seven years. The Options shall vest as follows: 25% after the first year of the Term, 35% after the second year, and 40% after the third year, subject to the Executive's continued employment and achievement of performance milestones as determined by the Board. Vesting shall accelerate in full upon a Change of Control (as defined in Section 5.4) or termination without Cause (as defined in Section 5.2), but unvested Options shall forfeit upon termination for Cause. All Options are subject to the terms of the Plan, including any clawback provisions required by applicable law (e.g., Dodd-Frank Act).
3.4 Performance Incentives. The Executive shall be eligible for additional performance-based bonuses in the form of shares of Common Stock, as follows:
- 300,000 shares upon achievement of specified revenue growth targets (percentage growth year-over-year, as determined by the Board);
- 300,000 shares upon achievement of strategic partnerships or licensing revenue thresholds (as determined by the Board);
- Up to 150,000 shares per quarter upon achievement of Board-approved key performance indicators (KPIs), including but not limited to financial compliance and operational support.
The specific targets and KPIs shall be established by the Board in consultation with the Executive within ninety (90) days of the Effective Date and reviewed annually. All performance incentives are subject to clawback if based on materially inaccurate financial statements or in cases of Executive misconduct (including but not limited to fraud, gross negligence, willful violation of law, or material breach of this Agreement), per Company policy and applicable law.
3.5 Annual Bonuses. he Executive shall be eligible for annual bonuses based on earnings per share (EPS) and share price growth, with targets and amounts determined by the Board in its sole discretion. Bonuses shall be paid no later than 2.5 months after fiscal year-end, subject to the Executive's continued employment through the payment date (except in cases of termination without Cause or for Good Reason).
3.6 Benefits. The Executive shall be entitled to participate in all employee benefit plans maintained by the Company for its executive employees on terms no less favorable than those provided to other senior executives, including but not limited to health insurance (with a stipend provided if not Company-sponsored) and retirement contribution matching (up to 5% of Base Salary, to be determined by the Board). The Executive shall also be entitled to reimbursement of pre-approved business expenses in accordance with Company policy, up to an annual allowance of $60,000 via a corporate credit card, subject to documentation and audit. All benefits are subject to the terms of the applicable plans and may be modified by the Company for all participants.
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4. Confidentiality, Non-Competition, and Non-Solicitation
4.1 Confidentiality. During the Term and indefinitely thereafter, the Executive shall not disclose, use, or permit others to use any Confidential Information except as required for the performance of his duties or as required by law (with prior notice to the Company). “Confidential Information” includes all non-public information regarding the Company's business, operations, IP, finances, or strategies. Upon termination, the Executive shall promptly return or destroy all Confidential Information and certify compliance.
4.2 Intellectual Property. The Executive hereby assigns to the Company all right, title, and interest in and to any inventions, discoveries, improvements, works of authorship, software, know-how, trade secrets, and other intellectual property (collectively, “Inventions”) that are created, conceived, developed, or reduced to practice by the Executive, solely or jointly with others, (i) during the Term, (ii) in connection with the Executive’s duties or employment hereunder, or (iii) using the Company’s resources, facilities, equipment, or Confidential Information. This assignment excludes any pre-existing intellectual property or Inventions of the Executive developed prior to the Effective Date or independently outside the scope of this Agreement.
4.3 Non-Competition. During the Term and for twelve (12) months thereafter (or the maximum enforceable period under applicable law), the Executive shall not, directly or indirectly, engage in, own, or provide services to any business that competes with the Company's AI-driven media and entertainment sector within the United States. The Company may enforce this through injunctive relief.
4.4 Non-Solicitation and Non-Disparagement. During the Term and for twelve (12) months thereafter, the Executive shall not solicit any Company employees, customers, or business partners for competitive purposes, nor make any disparaging statements about the Company, its officers, directors, or affiliates. The Company shall reciprocate non-disparagement.
4.5 Return of Property. Upon termination, the Executive shall immediately return all Company property, including documents, devices, and access credentials.
4.6 Enforceability. If any restrictive covenant is held unenforceable, it shall be reformed to the maximum enforceable extent. The Executive acknowledges these restrictions are reasonable to protect the Company's legitimate interests.
5. Termination
5.1 Termination Events. The Executive's employment may be terminated as follows:
§ By mutual written agreement;
§ By the Company for Cause upon written notice;
§ By the Company without Cause upon thirty (30) days' written notice;
§ By the Executive for Good Reason upon thirty (30) days' written notice;
§ By the Executive without Good Reason upon sixty (60) days' written notice;
§ Upon the Executive's death or Disability.
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5.2 Cause. “Cause” means: (i) conviction of (or plea of guilty or no contest to) a felony or crime involving moral turpitude; (ii) willful gross misconduct or fraud materially injurious to the Company (financially or reputationally); (iii) material breach of this Agreement (including willful violation of Sections 4.1, 4.3, or 4.4); or (iv) repeated and material failure to perform duties after written notice from the Company (or Board) specifying the deficiencies in reasonable detail and, for curable failures, a sixty (60) day cure period following such notice, during which the Executive fails to cure to the reasonable satisfaction of the Board. Termination for Cause shall require approval by a majority of the Board (excluding the Executive if a member), after providing the Executive a reasonable opportunity to be heard (in person or via representative). Non-curable acts (e.g., felony conviction, willful fraud) require no cure period.
5.3 Good Reason. “Good Reason” means: (i) material reduction in duties or compensation without consent; (ii) relocation of primary work location by more than 50 miles; or (iii) material breach by the Company, subject to notice and cure.
5.4 Severance Clause. If terminated without Cause or for Good Reason, or upon a Change of Control (defined as a sale of all or substantially all assets, a merger resulting in loss of control, or acquisition of 50%+ voting power), the Executive shall receive:
- Severance equals to 125% of remaining Base Salary for the Term.
- Immediate vesting of all unvested Options;
- Continuation of benefits for six (6) months;
- Ongoing royalties from the Executive's licensed IP for the remainder of the Term plus two (2) years (terms as per IP Licensing Agreement);
- Six (6) months of consulting at $20,000 per month.
5.5 Payments Upon Termination. Upon termination for Cause, death, or Disability, the Executive shall receive accrued but unpaid Base Salary and vested benefits only.
6. Miscellaneous
6.1 Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the internal laws of the State of Nevada, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. The parties irrevocably submit to the exclusive jurisdiction of the state and federal courts located in Clark County, Nevada (or, if no federal jurisdiction exists, the state courts of Nevada in Clark County), for any action or proceeding arising out of or relating to this Agreement (except for arbitration proceedings as provided in Section 6.2), and hereby waive any objection to venue in such courts based on forum non conveniens or any other ground. Each party hereby waives any right to a jury trial in connection with any such action or proceeding.
6.2 Arbitration. Any dispute, controversy, or claim arising out of or relating to this Agreement, including its formation, validity, breach, termination, or interpretation, or the Executive’s employment relationship with the Company (each, a “Claim”), shall be finally settled by binding arbitration administered by the American Arbitration Association (“AAA”) in accordance with its Employment Arbitration Rules then in effect (the “Rules”). The arbitration shall be conducted in Las Vegas, Nevada (or, if mutually agreed in writing by the parties, New York, New York), by a single arbitrator selected in accordance with the Rules. The arbitrator shall be a licensed attorney with at least ten (10) years of experience in employment law, executive compensation, and corporate governance matters. The language of the arbitration shall be English. The arbitrator shall have the authority to grant any equitable relief (including preliminary and permanent injunctive relief) that a court could award, and the award shall be final and binding, with no right of appeal except as provided by applicable law. The prevailing party in any arbitration or related court proceeding shall be entitled to recover its reasonable attorneys’ fees, costs, and expenses incurred in connection therewith. Judgment on the award may be entered in any court having jurisdiction thereof. Notwithstanding the foregoing, either party may seek provisional injunctive relief (including temporary restraining orders or preliminary injunctions) in any court of competent jurisdiction to prevent irreparable harm pending the outcome of arbitration, without waiving the right to arbitration on the merits. The parties agree that any such injunctive relief action shall be brought exclusively in the state or federal courts located in Clark County, Nevada.
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6.3 Entire Agreement. This Agreement, together with the Intellectual Property Licensing Agreement executed concurrently herewith and any exhibits, schedules, or appendices attached hereto or thereto, constitutes the entire understanding and agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous understandings, agreements, representations, warranties, and negotiations, whether oral or written, relating to such subject matter. Each party acknowledges that, in entering into this Agreement, it has not relied on any statement, representation, warranty, or understanding not expressly set forth herein.
6.4 Amendments; Waivers. No amendment, modification, supplement, or waiver of any provision of this Agreement shall be effective unless in writing and signed by an authorized representative of each party. No waiver by either party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence. No course of dealing or failure to insist upon strict adherence to any term of this Agreement shall constitute a waiver of such term.
6.5 Assignment. Neither party may assign, delegate, or otherwise transfer this Agreement or any of its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld, conditioned, or delayed; provided, however, that the Company may assign this Agreement without the Executive’s consent (i) to any Affiliate, or (ii) in connection with a merger, consolidation, reorganization, sale of all or substantially all of its assets, or other similar transaction involving the Company or its business, provided that the assignee assumes in writing all of the Company’s obligations hereunder and provides written notice to the Executive within ten (10) business days after such assignment. Any purported assignment in violation of this Section shall be null and void ab initio.
6.6 Severability. If any provision of this Agreement is held to be illegal, invalid, or unenforceable under present or future laws effective during the Term, such provision shall be fully severable. The remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid, or unenforceable provision, there shall be added automatically as part of this Agreement a provision as similar in terms to such illegal, invalid, or unenforceable provision as may be possible and be legal, valid, and enforceable.
6.7 Waiver. No waiver of any term or condition of this Agreement shall be valid unless in writing and signed by the waiving party. The failure or delay of either party to exercise or enforce any right, power, or remedy under this Agreement shall not constitute a waiver thereof, nor shall any single or partial exercise preclude any other or further exercise of such right, power, or remedy or the exercise of any other right, power, or remedy.6.8 Notices. All notices, requests, consents, claims, demands, waivers, and other communications hereunder (each, a “Notice”) shall be in writing and addressed to the parties at the addresses set forth below (or to such other address that may be designated by the receiving party from time to time in accordance with this Section). All Notices shall be delivered by personal delivery, nationally recognized overnight courier (with all fees prepaid), facsimile or email (with confirmation of transmission) or certified or registered mail (in each case, return receipt requested, postage prepaid). Notice is effective upon receipt by the receiving party, and if the party giving the Notice has complied with the requirements of this Section. Notwithstanding the foregoing, routine business communications (not constituting formal Notices under this Agreement) may be sent by email without confirmation of receipt.
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If to the Company:
AI Era Corp.
144 Main Street
Mt. Kisco, NY 10549
Attention: Chiyuan Deng
Email: [email protected]
If to the Executive:
Chiyuan Deng
144 Main Street
Mt. Kisco, NY 10549
6.9 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile, email (including pdf or other electronic format), or other electronic means shall be effective as delivery of a manually executed counterpart of this Agreement. This Agreement shall be deemed executed when each party has delivered a signed counterpart (whether original, facsimile, or electronic) to the other party.
6.10 Force Majeure. Neither party shall be liable or responsible to the other party, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement (except for any obligations to make payments hereunder), when and to the extent such failure or delay is caused by or results from acts beyond the impacted party’s reasonable control, including, without limitation, the following force majeure events (“Force Majeure Event(s)”): acts of God; flood, fire, earthquake, explosion, or other natural disaster; war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; government order, law, or action; embargoes or blockades in effect on or after the date of this Agreement; action by any governmental authority; national or regional emergency; strikes, labor stoppages or slowdowns, or other industrial disturbances; shortage of adequate power or transportation facilities; and other similar events beyond the reasonable control of the impacted party. The impacted party shall give notice within five (5) business days of the Force Majeure Event to the other party, describing the Force Majeure Event and its impact, and shall use commercially reasonable efforts to end the failure or delay and ensure the effects of such Force Majeure Event are minimized. If a Force Majeure Event prevents performance for a continuous period of more than ninety (90) days, either party may terminate this Agreement upon written notice to the other party.
6.11 Further Assurances. Each party agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be reasonably necessary or appropriate to effectuate, carry out, and perform all of the terms, provisions, and conditions of this Agreement and all transactions contemplated hereby.
6.12 No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.
6.13 Interpretation. The parties acknowledge that this Agreement was negotiated at arm’s length with the benefit of legal counsel for each party. Accordingly, no rule of strict construction or interpretation against the drafter shall apply to this Agreement or any provision hereof.
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6.14 Headings. The headings in this Agreement are for convenience only and shall not be used in the interpretation of this Agreement.
6.15 Independent Contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture, or other form of joint enterprise, employment relationship beyond that expressly set forth herein, or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever.
6.16 Publicity. Neither party shall issue any press release or make any other public announcement or disclosure regarding this Agreement or the transactions contemplated hereby without the prior written consent of the other party (not to be unreasonably withheld), except as required by applicable law, regulation, or stock exchange rules, in which case the disclosing party shall provide the other party with a reasonable opportunity to review and comment on the disclosure prior to issuance.
6.17 Survival. The provisions of Sections 4 (Confidentiality, Intellectual Property, Non-Competition, and Non-Solicitation), 5.5 (Payments Upon Termination), 6.1 (Governing Law), 6.2 (Arbitration), 6.3 (Entire Agreement), 6.6 (Severability), 6.7 (Waiver), 6.8 (Notices), and 6.16 (Publicity) shall survive any termination or expiration of this Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.
AI Era Corp.
(the Company)
By: /s/ Ahmad Moradi
Ahmad Moradi
Chief Executive Officer
/s/ Chiyuan Deng
Chiyuan Deng
(the Executive)
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AI ERA CORP.
(the “Company”)
2026 INCENTIVE PLAN
Section 1. PURPOSE
The purpose of the AI Era Corp. 2026 Incentive Plan is to attract, retain and motivate employees, officers, directors, consultants, agents, advisors and independent contractors of the Company and its Related Companies by providing them the opportunity to acquire a proprietary interest in the Company and to align their interests and efforts to the long-term interests of the Company’s stockholders.
Section 2. DEFINITIONS
Certain capitalized terms used in the Plan have the meanings set forth in Appendix A.
Section 3. ADMINISTRATION
3.1 Administration of the Plan
The Plan shall be administered by the Board or its Compensation Committee. The Compensation Committee shall be composed of two or more directors, each of whom is a “non-employee director” within the meaning of Rule 16b-3(b)(3) promulgated under the Exchange Act, or any successor definition adopted by the Securities and Exchange Commission. As used in this Plan, the term “Compensation Committee” shall be construed as if followed by the words “(if any)”; nothing in this Plan requires the Board to have a Compensation Committee.
3.2 Delegation
Notwithstanding the foregoing, the Board may delegate responsibility for administering the Plan with respect to designated classes of Eligible Persons to different committees consisting of one or more members of the Board, subject to such limitations as the Board deems appropriate, except with respect to Awards to any Participants who are then subject to Section 16 of the Exchange Act. Members of any committee shall serve for such term as the Board may determine, subject to removal by the Board at any time. To the extent consistent with applicable law, the Board or the Compensation Committee may authorize one or more officers of the Company to grant Awards to designated classes of Eligible Persons, within limits specifically prescribed by the Board or the Compensation Committee; provided, however, that no such officer shall have or obtain authority to grant Awards to himself or herself or to any person then subject to Section 16 of the Exchange Act. All references in the Plan to the “Committee” shall be, as applicable, to the Board, the Compensation Committee or any other committee or any officer to whom the Board or the Compensation Committee has delegated authority to administer the Plan.
3.3 Administration and Interpretation by Committee
(a) Except for the terms and conditions explicitly set forth in the Plan and to the extent permitted by applicable law, the Committee shall have full power and exclusive authority, subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the Board, to
(i) select the Eligible Persons to whom Awards may from time to time be granted under the Plan;
(ii) determine the type or types of Awards to be granted to each Participant under the Plan;
(iii) determine the number of shares of Common Stock, if any, to be covered by each Award granted under the Plan;
(iv) determine the terms and conditions of any Award granted under the Plan;
(v) approve the forms of notice or agreement for use under the Plan;
(vi) determine whether, to what extent and under what circumstances Awards may be settled in cash, shares of Common Stock or other property or canceled or suspended;
(vii) determine whether, to what extent and under what circumstances cash, shares of Common Stock, other property and other amounts payable with respect to an Award shall be deferred either automatically or at the election of the Participant;
(viii) interpret and administer the Plan and any instrument evidencing an Award, notice or agreement executed or entered into under the Plan;
(ix) establish such rules and regulations as it shall deem appropriate for the proper administration of the Plan;
(x) delegate ministerial duties to such of the Company’s employees as it so determines; and
(xi) make any other determination and take any other action that the Committee deems necessary or desirable for administration of the Plan.
(b) The Committee shall have the right, without stockholder approval, to cancel or amend outstanding Options or SARs for the purpose of repricing, replacing or regranting such Options or SARs with Options or SARs that have a purchase or grant price that is less than the purchase or grant price for the original Options or SARs except in connection with adjustments provided in Section 15.
(c) The effect on the vesting of an Award of a Company-approved leave of absence or a Participant’s working less than full-time shall be determined by the Company’s chief human resources officer or other person performing that function or, with respect to directors or executive officers, by the Committee, whose determination shall be final.
(d) Decisions of the Committee shall be final, conclusive and binding on all persons, including the Company, any Participant, any stockholder and any Eligible Person. A majority of the members of the Committee may determine its actions.
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Section 4. SHARES SUBJECT TO THE PLAN
4.1 Authorized Number of Shares
Subject to adjustment from time to time as provided in subsection 15.1, a maximum of 10,000,000 shares of Common Stock shall be available for issuance under the Plan. Shares issued under the Plan shall be drawn from authorized and unissued shares or shares now held or subsequently acquired by the Company as treasury shares.
4.2 Share Usage
(a) Shares of Common Stock covered by an Award shall not be counted as used unless and until they are actually issued and delivered to a Participant. If any Award lapses, expires, terminates or is canceled prior to the issuance of shares thereunder or if shares of Common Stock are issued under the Plan to a Participant and thereafter are forfeited to or otherwise reacquired by the Company, the shares subject to such Awards and the forfeited or reacquired shares shall again be available for issuance under the Plan. Any shares of Common Stock
(i) tendered by a Participant or retained by the Company as full or partial payment to the Company for the purchase price of an Award or to satisfy tax withholding obligations in connection with an Award, or
(ii) covered by an Award that is settled in cash, or in a manner such that some or all of the shares of Common Stock covered by the Award are not issued,
shall be available for Awards under the Plan. The number of shares of Common Stock available for issuance under the Plan shall not be reduced to reflect any dividends or dividend equivalents that are reinvested into additional shares of Common Stock or credited as additional shares of Common Stock subject or paid with respect to an Award.
(b) The Committee shall also, without limitation, have the authority to grant Awards as an alternative to or as the form of payment for grants or rights earned or due under other compensation plans or arrangements of the Company.
(c) Notwithstanding anything in the Plan to the contrary, the Committee may grant Substitute Awards under the Plan. Substitute Awards shall not reduce the number of shares authorized for issuance under the Plan. In the event that an Acquired Entity has shares available for awards or grants under one or more preexisting plans not adopted in contemplation of such acquisition or combination, then, to the extent determined by the Committee, the shares available for grant pursuant to the terms of such preexisting plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to holders of common stock of the entities that are parties to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the number of shares of Common Stock authorized for issuance under the Plan; provided, however, that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of such preexisting plans, absent the acquisition or combination, and shall only be made to individuals who were not employees or directors of the Company or a Related Company prior to such acquisition or combination. In the event that a written agreement between the Company and an Acquired Entity pursuant to which a merger or consolidation is completed is approved by the Board and that agreement sets forth the terms and conditions of the substitution for or assumption of outstanding awards of the Acquired Entity, those terms and conditions shall be deemed to be the action of the Committee without any further action by the Committee, except as may be required for compliance with Rule 16b-3 under the Exchange Act, and the persons holding such awards shall be deemed to be Participants.
(d) Notwithstanding the other provisions in this subsection, the maximum number of shares that may be issued upon the exercise of Incentive Stock Options shall equal the aggregate share number stated in subsection 4.1, subject to adjustment as provided in subsection 15.1.
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Section 5. ELIGIBILITY
An Award may be granted to any employee, officer or director of the Company or a Related Company whom the Committee from time to time selects. An Award may also be granted to any consultant, agent, advisor or independent contractor for bona fide services rendered to the Company or any Related Company that:
(a) are not in connection with the offer and sale of the Company’s securities in a capital-raising transaction, and
(b) do not directly or indirectly promote or maintain a market for the Company’s securities.
Section 6. AWARDS
6.1 Form, Grant and Settlement of Awards
The Committee shall have the authority, in its sole discretion, to determine the type or types of Awards to be granted under the Plan. Such Awards may be granted either alone or in addition to or in tandem with any other type of Award. Any Award settlement may be subject to such conditions, restrictions and contingencies as the Committee shall determine.
6.2 Evidence of Awards
Awards granted under the Plan shall be evidenced by a written, including an electronic, notice or agreement that shall contain such terms, conditions, limitations and restrictions as the Committee shall deem advisable and that are not inconsistent with the Plan.
6.3 Deferrals
The Committee may permit or require a Participant to defer receipt of the payment of any Award if and to the extent set forth in the instrument evidencing the Award at the time of grant. If any such deferral election is permitted or required, the Committee, in its sole discretion, shall establish rules and procedures for such payment deferrals, which may include the grant of additional Awards or provisions for the payment or crediting of interest or dividend equivalents, including converting such credits to deferred stock unit equivalents; provided, however, that the terms of any deferrals under this subsection shall comply with all applicable law, rules and regulations, including, without limitation, Section 409A of the Code.
6.4 Dividends and Distributions
Participants may, if and to the extent the Committee so determines and sets forth in the instrument evidencing the Award at the time of grant, be credited with dividends paid with respect to shares of Common Stock underlying an Award in a manner determined by the Committee in its sole discretion. The Committee may apply any restrictions to the dividends or dividend equivalents that the Committee deems appropriate. The Committee, in its sole discretion, may determine the form of payment of dividends or dividend equivalents, including cash, shares of Common Stock, Restricted Stock or Stock Units.
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Section 7. OPTIONS
7.1 Grant of Options
The Committee may grant Options designated as Incentive Stock Options or Nonqualified Stock Options.
7.2 Option Exercise Price
The exercise price for shares purchased under an Option shall be at least 100% of the Fair Market Value on the Grant Date (and shall not be less than the minimum exercise price required by Section 422 of the Code with respect to Incentive Stock Options), except in the case of Substitute Awards.
7.3 Term of Options
Subject to earlier termination in accordance with the terms of the Plan and the instrument evidencing the Option, the maximum term of a Nonqualified Stock Option shall be ten years from the Grant Date.
7.4 Exercise of Options
The Committee shall establish and set forth in each instrument that evidences an Option the time at which, or the installments in which, the Option shall vest and become exercisable, any of which provisions may be waived or modified by the Committee at any time.
To the extent an Option has vested and become exercisable, the Option may be exercised in whole or from time to time in part by delivery to or as directed or approved by the Company of a properly executed stock option exercise agreement or notice, in a form and in accordance with procedures established by the Committee, setting forth the number of shares with respect to which the Option is being exercised, the restrictions imposed on the shares purchased under such exercise agreement, if any, and such representations and agreements as may be required by the Committee, accompanied by payment in full as described in subsection 7.5 and Section 13. An Option may be exercised only for whole shares and may not be exercised for less than a reasonable number of shares at any one time, as determined by the Committee.
7.5 Payment of Exercise Price
The exercise price for shares purchased under an Option shall be paid in full to the Company by delivery of consideration equal to the product of the Option exercise price and the number of shares purchased. Such consideration must be paid before the Company will issue the shares being purchased and must be in a form or a combination of forms acceptable to the Committee for that purchase, which forms may include:
(a) cash;
(b) check or wire transfer;
(c) having the Company withhold shares of Common Stock that would otherwise be issued on exercise of the Option that have an aggregate Fair Market Value equal to the aggregate exercise price of the shares being purchased under the Option;
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(d) tendering (either actually or, so long as the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act, by attestation) shares of Common Stock owned by the Participant that have an aggregate Fair Market Value equal to the aggregate exercise price of the shares being purchased under the Option;
(e) so long as the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act, and to the extent permitted by law, delivery of a properly executed exercise notice, together with irrevocable instructions to a brokerage firm designated or approved by the Company to deliver promptly to the Company the aggregate amount of proceeds to pay the Option exercise price and any withholding tax obligations that may arise in connection with the exercise, all in accordance with the regulations of the Federal Reserve Board; or
(f) such other consideration as the Committee may permit.
7.6 Effect of Termination of Service
The Committee shall establish and set forth in each instrument that evidences an Option whether the Option shall continue to be exercisable, and the terms and conditions of such exercise, after a Termination of Service, any of which provisions may be waived or modified by the Committee at any time. If not so established in the instrument evidencing the Option, the Option shall be exercisable according to the following terms and conditions, which may be waived or modified by the Committee at any time:
(a) Any portion of an Option that is not vested and exercisable on the date of a Participant’s Termination of Service shall expire on such date.
(b) Any portion of an Option that is vested and exercisable on the date of a Participant’s Termination of Service shall expire on the earliest to occur of:
(i) if the Participant’s Termination of Service occurs for reasons other than Cause, Retirement, Disability or death, the date that is three months after such Termination of Service;
(ii) if the Participant’s Termination of Service occurs by reason of Retirement, Disability or death, the one-year anniversary of such Termination of Service; and
(iii) the Option Expiration Date.
Notwithstanding the foregoing, if a Participant dies after his or her Termination of Service but while an Option is otherwise exercisable, the portion of the Option that is vested and exercisable on the date of such Termination of Service shall expire upon the earlier to occur of (y) the Option Expiration Date and (z) the one-year anniversary of the date of death, unless the Committee determines otherwise. Also notwithstanding the foregoing, in case a Participant’s Termination of Service occurs for Cause, all Options granted to the Participant shall automatically expire upon first notification to the Participant of such termination, unless the Committee determines otherwise. If a Participant’s employment or service relationship with the Company is suspended pending an investigation of whether the Participant shall be terminated for Cause, all the Participant’s rights under any Option shall likewise be suspended during the period of investigation. If any facts that would constitute termination for Cause are discovered after a Participant’s Termination of Service, any Option then held by the Participant may be immediately terminated by the Committee, in its sole discretion.
(c) If the exercise of the Option following a Participant’s Termination of Service, but while the Option is otherwise exercisable, would be prohibited solely because the issuance of Common Stock would violate either the registration requirements under the Securities Act or the Company’s insider trading policy, then the Option shall remain exercisable until the earlier of (i) the Option Expiration Date and (ii) the expiration of a period of three months (or such longer period of time as determined by the Committee in its sole discretion) after the Participant’s Termination of Service during which the exercise of the Option would not be in violation of such Securities Act or insider trading policy requirements.
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Section 8. INCENTIVE STOCK OPTION LIMITATIONS
Notwithstanding any other provisions of the Plan, the terms and conditions of any Incentive Stock Options shall also comply in all respects with Section 422 of the Code, or any successor provision, and any applicable regulations thereunder, including, to the extent required thereunder, the following:
8.1 Dollar Limitation
To the extent the aggregate Fair Market Value (determined as of the Grant Date) of Common Stock with respect to which a Participant’s Incentive Stock Options become exercisable for the first time during any calendar year (under the Plan and all other stock option plans of the Company and its parent and subsidiary corporations) exceeds $100,000, such portion in excess of $100,000 shall be treated as a Nonqualified Stock Option. In the event the Participant holds two or more such Options that become exercisable for the first time in the same calendar year, such limitation shall be applied on the basis of the order in which such Options are granted.
8.2 Eligible Employees.
Individuals who are not employees of the Company or one of its parent or subsidiary corporations may not be granted Incentive Stock Options.
8.3 Exercise Price
The exercise price of an Incentive Stock Option shall be at least 100% of the Fair Market Value of the Common Stock on the Grant Date, and in the case of an Incentive Stock Option granted to a Participant who owns more than 10% of the total combined voting power of all classes of the stock of the Company or of its parent or subsidiary corporations (a “Ten Percent Stockholder”), shall not be less than 110% of the Fair Market Value of the Common Stock on the Grant Date. The determination of more than 10% ownership shall be made in accordance with Section 422 of the Code.
8.4 Option Term
Subject to earlier termination in accordance with the terms of the Plan and the instrument evidencing the Option, the maximum term of an Incentive Stock Option shall not exceed ten years, and in the case of an Incentive Stock Option granted to a Ten Percent Stockholder, shall not exceed five years.
8.5 Exercisability
An Option designated as an Incentive Stock Option shall cease to qualify for favorable tax treatment as an Incentive Stock Option to the extent it is exercised (if permitted by the terms of the Option) (a) more than three months after the date of a Participant’s Termination of Service if termination was for reasons other than death or disability, (b) more than one year after the date of a Participant’s Termination of Service if termination was by reason of disability, or (c) after the Participant has been on leave of absence for more than 90 days, unless the Participant’s reemployment rights are guaranteed by statute or contract.
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8.6 Taxation of Incentive Stock Options
In order to obtain certain tax benefits afforded to Incentive Stock Options under Section 422 of the Code, the Participant must hold the shares acquired upon the exercise of an Incentive Stock Option for two years after the Grant Date and one year after the date of exercise.
A Participant may be subject to the alternative minimum tax at the time of exercise of an Incentive Stock Option. The Participant shall give the Company prompt notice of any disposition of shares acquired on the exercise of an Incentive Stock Option prior to the expiration of such holding periods.
8.7 Code Definitions
For the purposes of this Section, “disability” “parent corporation” and “subsidiary corporation” shall have the meanings attributed to those terms for purposes of Section 422 of the Code.
Section 9. STOCK APPRECIATION RIGHTS
9.1 Grant of Stock Appreciation Rights
The Committee may grant Stock Appreciation Rights to Participants at any time on such terms and conditions as the Committee shall determine in its sole discretion. An SAR may be granted in tandem with an Option or alone (“freestanding”). The grant price of a tandem SAR shall be equal to the exercise price of the related Option. The grant price of a freestanding SAR shall be established in accordance with procedures for Options set forth in subsection 7.2. An SAR may be exercised upon such terms and conditions and for the term as the Committee determines in its sole discretion; provided, however, that, subject to earlier termination in accordance with the terms of the Plan and the instrument evidencing the SAR, the maximum term of a freestanding SAR shall be ten years, and in the case of a tandem SAR, (a) the term shall not exceed the term of the related Option and (b) the tandem SAR may be exercised for all or part of the shares subject to the related Option upon the surrender of the right to exercise the equivalent portion of the related Option, except that the tandem SAR may be exercised only with respect to the shares for which its related Option is then exercisable.
9.2 Payment of SAR Amount
Upon the exercise of an SAR, a Participant shall be entitled to receive payment in an amount determined by multiplying:
(a) the difference between the Fair Market Value of the Common Stock on the date of exercise over the grant price of the SAR by
(b) the number of shares with respect to which the SAR is exercised.
At the discretion of the Committee as set forth in the instrument evidencing the Award, the payment upon exercise of an SAR may be in cash, in shares, in some combination thereof or in any other manner approved by the Committee in its sole discretion.
9.3 Waiver of Restrictions
Subject to subsection 18.5, the Committee, in its sole discretion, may waive any other terms, conditions or restrictions on any SAR under such circumstances and subject to such terms and conditions as the Committee shall deem appropriate.
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Section 10. STOCK AWARDS, RESTRICTED STOCK AND STOCK UNITS
10.1 Grant of Stock Awards, Restricted Stock and Stock Units
The Committee may grant Stock Awards, Restricted Stock and Stock Units on such terms and conditions and subject to such repurchase or forfeiture restrictions, if any, which may be based on continuous service with the Company or a Related Company or the achievement of any performance goals, as the Committee shall determine in its sole discretion, which terms, conditions and restrictions shall be set forth in the instrument evidencing the Award.
10.2 Vesting of Restricted Stock and Stock Units
Upon the satisfaction of any terms, conditions and restrictions prescribed with respect to Restricted Stock or Stock Units, or upon a Participant’s release from any terms, conditions and restrictions of Restricted Stock or Stock Units, as determined by the Committee, and subject to the provisions of Section 13:
(a) the shares of Restricted Stock covered by each Award of Restricted Stock shall become freely transferable by the Participant, and
(b) Stock Units shall be paid in shares of Common Stock or, if set forth in the instrument evidencing the Awards, in cash or a combination of cash and shares of Common Stock.
Any fractional shares subject to such Awards shall be paid to the Participant in cash.
10.3 Waiver of Restrictions
Subject to subsection 18.5, the Committee, in its sole discretion, may waive the repurchase or forfeiture period and any other terms, conditions or restrictions on any Restricted Stock or Stock Unit under such circumstances and subject to such terms and conditions as the Committee shall deem appropriate.
Section 11. PERFORMANCE AWARDS
11.1 Performance Shares
The Committee may grant Awards of Performance Shares, designate the Participants to whom Performance Shares are to be awarded and determine the number of Performance Shares and the terms and conditions of each such Award. Performance Shares shall consist of a unit valued by reference to a designated number of shares of Common Stock, the value of which may be paid to the Participant by delivery of shares of Common Stock or, if set forth in the instrument evidencing the Award, of such property as the Committee shall determine, including, without limitation, cash, shares of Common Stock, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. Subject to subsection 18.5, the amount to be paid under an Award of Performance Shares may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.
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11.2 Performance Units
The Committee may grant Awards of Performance Units, designate the Participants to whom Performance Units are to be awarded and determine the number of Performance Units and the terms and conditions of each such Award. Performance Units shall consist of a unit valued by reference to a designated amount of property other than shares of Common Stock, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including, without limitation, cash, shares of Common Stock, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. Subject to subsection 18.5, the amount to be paid under an Award of Performance Units may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.
Section 12. OTHER STOCK OR CASH-BASED AWARDS
Subject to the terms of the Plan and such other terms and conditions as the Committee deems appropriate, the Committee may grant other incentives payable in cash or in shares of Common Stock under the Plan.
Section 13. WITHHOLDING
The Company may require the Participant to pay to the Company the amount of:
(a) any taxes that the Company is required by applicable federal, state, local or foreign law to withhold with respect to the grant, vesting or exercise of an Award (“tax withholding obligations”); and
(b) any amounts due from the Participant to the Company or to any Related Company (“other obligations”).
The Company shall not be required to issue any shares of Common Stock or otherwise settle an Award under the Plan until such tax withholding obligations and other obligations are satisfied. The Committee may permit or require a Participant to satisfy all or part of the Participant’s tax withholding obligations and other obligations by:
(i) paying cash to the Company,
(ii) having the Company withhold an amount from any cash amounts otherwise due or to become due from the Company to the Participant,
(iii) having the Company withhold a number of shares of Common Stock that would otherwise be issued to the Participant (or become vested, in the case of Restricted Stock) having a Fair Market Value equal to the tax withholding obligations and other obligations, or
(iv) surrendering a number of shares of Common Stock the Participant already owns having a value equal to the tax withholding obligations and other obligations.
The value of the shares so withheld or tendered may not exceed the employer’s minimum required tax withholding rate.
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Section 14. ASSIGNABILITY
No Award or interest in an Award may be sold, assigned, pledged (as collateral for a loan or as security for the performance of an obligation or for any other purpose) or transferred by a Participant or made subject to attachment or similar proceedings otherwise than by will or by the applicable laws of descent and distribution, except to the extent the Participant designates one or more beneficiaries on a Company-approved form who may exercise the Award or receive payment under the Award after the Participant’s death. During a Participant’s lifetime, an Award may be exercised only by the Participant. Notwithstanding the foregoing and to the extent permitted by Section 422 of the Code, the Committee, in its sole discretion, may permit a Participant to assign or transfer an Award subject to such terms and conditions as the Committee shall specify.
Section 15. ADJUSTMENTS
15.1 Adjustment of Shares
In the event, at any time or from time to time, a stock dividend, stock split, spin-off, combination or exchange of shares, recapitalization, merger, consolidation, distribution to stockholders other than a normal cash dividend, or other change in the Company’s corporate or capital structure results in
(a) the outstanding shares of Common Stock, or any securities exchanged therefor or received in their place, being exchanged for a different number or kind of securities of the Company or
(b) new, different or additional securities of the Company or any other company being received by the holders of shares of Common Stock,
then the Committee shall make proportional adjustments in
(i) the maximum number and kind of securities available for issuance under the Plan;
(ii) the maximum number and kind of securities issuable as Incentive Stock Options as set forth in subsection 4.2; and
(iii) the number and kind of securities that are subject to any outstanding Award and the per share price of such securities, without any change in the aggregate price to be paid therefor.
The determination by the Committee, as to the terms of any of the foregoing adjustments shall be conclusive and binding. Notwithstanding the foregoing, the issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services rendered, either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, outstanding Awards. Also notwithstanding the foregoing, a dissolution or liquidation of the Company or a Company Transaction shall not be governed by this subsection but shall be governed by subsections 15.2 and 15.3, respectively.
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15.2 Dissolution or Liquidation
To the extent not previously exercised or settled, and unless otherwise determined by the Committee in its sole discretion, Awards shall terminate immediately prior to the dissolution or liquidation of the Company. To the extent a vesting condition, forfeiture provision or repurchase right applicable to an Award has not been waived by the Committee, the Award shall be forfeited immediately prior to the consummation of the dissolution or liquidation.
15.3 Change in Control
Notwithstanding any other provision of the Plan to the contrary, unless the Committee shall determine otherwise in the instrument evidencing the Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, in the event of a Change in Control:
(a) All outstanding Awards, other than Performance Shares and Performance Units, shall become fully and immediately exercisable, and all applicable deferral and restriction limitations or forfeiture provisions shall lapse, immediately prior to the Change in Control and shall terminate at the effective time of the Change in Control; provided, however, that with respect to a Change in Control that is a Company Transaction, such Awards shall become fully and immediately exercisable, and all applicable deferral and restriction limitations or forfeiture provisions shall lapse, only if and to the extent such Awards are not converted, assumed or replaced by the Successor Company. For the purposes of this paragraph, an Award shall be considered converted, assumed or replaced by the Successor Company if following the Company Transaction the option or right confers the right to purchase or receive, for each share of Common Stock subject to the Award immediately prior to the Company Transaction, the consideration (whether stock, cash or other securities or property) received in the Company Transaction by holders of Common Stock for each share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares); provided, however, that if such consideration received in the Company Transaction is not solely common stock of the Successor Company, the Committee may, with the consent of the Successor Company, provide for the consideration to be received upon the exercise of the Option, for each share of Common Stock subject thereto, to be solely common stock of the Successor Company substantially equal in fair market value to the per share consideration received by holders of Common Stock in the Company Transaction. The determination of such substantial equality of value of consideration shall be made by the Committee, and its determination shall be conclusive and binding.
(b) All Performance Shares or Performance Units earned and outstanding as of the date the Change in Control is determined to have occurred shall be payable in full at the target level in accordance with the payout schedule pursuant to the instrument evidencing the Award. Any remaining Performance Shares or Performance Units (including any applicable performance period) for which the payout level has not been determined shall be prorated at the target payout level up to and including the date of such Change in Control and shall be payable in full at the target level in accordance with the payout schedule pursuant to the instrument evidencing the Award. Any existing deferrals or other restrictions not waived by the Committee in its sole discretion shall remain in effect.
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(c) Notwithstanding paragraphs 15.3(a) and 15.3(b), the Committee, in its sole discretion, may (unless otherwise provided in the instrument evidencing the Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company) instead provide in the event of a Change in Control that is a Company Transaction
(i) for adjustments to the Plan and outstanding Awards as contemplated by subsection 15.1 or
(ii) that a Participant’s outstanding Awards shall terminate upon or immediately prior to such Company Transaction and that such Participant shall receive, in exchange therefor, a cash payment equal to the amount (if any) by which (x) the value of the per share consideration received by holders of Common Stock in the Company Transaction, or, if the Company Transaction is a sale of assets or otherwise does not result in direct receipt of consideration by holders of Common Stock, the value of the deemed per share consideration received, in each case as determined by the Committee in its sole discretion, multiplied by the number of shares of Common Stock subject to such outstanding Awards (to the extent then vested and exercisable or whether or not then vested and exercisable, as determined by the Committee in its sole discretion) exceeds (y) if applicable, the respective aggregate exercise price or grant price for such Awards.
15.4 Further Adjustment of Awards
Subject to subsections 15.2 and 15.3, the Committee shall have the discretion, exercisable at any time before a sale, merger, consolidation, reorganization, liquidation, dissolution or change in control of the Company, as defined by the Committee, to take such further action as it determines to be necessary or advisable with respect to Awards. Such authorized action may include (but shall not be limited to) establishing, amending or waiving the type, terms, conditions or duration of, or restrictions on, Awards so as to provide for earlier, later, extended or additional time for exercise, lifting restrictions and other modifications, and the Committee may take such actions with respect to all Participants, to certain categories of Participants or only to individual Participants. The Committee may take such action before or after granting Awards to which the action relates and before or after any public announcement with respect to such sale, merger, consolidation, reorganization, liquidation, dissolution or change in control that is the reason for such action.
15.5 No Limitations
The grant of Awards shall in no way affect the Company’s right to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.
15.6 Fractional Shares
In the event of any adjustment in the number of shares covered by any Award, each such Award shall cover only the number of full shares resulting from such adjustment.
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15.7 Section 409A of the Code
Notwithstanding anything in this Plan to the contrary,
(a) any adjustments made pursuant to this Section 15 or any other amendments to Awards that are considered “deferred compensation” within the meaning of Section 409A of the Code shall be made in compliance with the requirements of Section 409A of the Code and
(b) any adjustments made pursuant to this Section 15 or any other amendments to Awards that are not considered “deferred compensation” subject to Section 409A of the Code
shall be made in such a manner as to ensure that after such adjustment or amendment the Awards either
(i) continue not to be subject to Section 409A of the Code or
(ii) comply with the requirements of Section 409A of the Code.
Section 16. MARKET STANDOFF
In the event of an underwritten public offering by the Company of its equity securities pursuant to an effective registration statement filed under the Securities Act, no person may sell, make any short sale of, loan, hypothecate, pledge, grant any option for the purchase of, or otherwise dispose of or transfer for value or otherwise agree to engage in any of the foregoing transactions with respect to any shares issued pursuant to an Award granted under the Plan without the prior written consent of the Company or its underwriters. Such limitations shall be in effect for such period of time as may be requested by the Company or such underwriters; provided, however, that in no event shall such period exceed
(a) 180 days after the effective date of the registration statement for such public offering or
(b) such longer period requested by the underwriter as is necessary to comply with regulatory restrictions on the publication of research reports (including, but not limited to, NYSE Rule 472 or NASD Conduct Rule 2711).
In the event of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the Company’s outstanding Common Stock effected as a class without the Company’s receipt of consideration, any new, substituted or additional securities distributed with respect to any shares issued as or pursuant to an Award under the Plan shall be immediately subject to the provisions of this Section 16, to the same extent such shares are at such time covered by such provisions. In order to enforce the limitations of this Section 16, the Company may impose stop-transfer instructions with respect to the purchased shares until the end of the applicable standoff period.
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Section 17. AMENDMENT AND TERMINATION
17.1 Amendment, Suspension or Termination
The Board or the Compensation Committee may amend, suspend or terminate the Plan or any portion of the Plan at any time and in such respects as it shall deem advisable; provided, however, that, to the extent required by applicable law, regulation or stock exchange rule, stockholder approval shall be required for any amendment to the Plan; and provided, further, that any amendment that requires stockholder approval may be made only by the Board and not by the Compensation Committee. Subject to subsection 17.3, the Committee may amend the terms of any outstanding Award, prospectively or retroactively.
17.2 Term of the Plan
Unless sooner terminated as provided herein, the Plan shall terminate 10 years from the Effective Date. After the Plan is terminated, no future Awards may be granted, but Awards previously granted shall remain outstanding in accordance with their applicable terms and conditions and the Plan’s terms and conditions. Notwithstanding the foregoing, no Incentive Stock Options may be granted more than 10 years after the later of:
(a) the adoption of the Plan by the Board and
(b) the adoption by the Board of any amendment to the Plan that constitutes the adoption of a new plan for purposes of Section 422 of the Code.
17.3 Consent of Participant
The amendment, suspension or termination of the Plan or a portion thereof or the amendment of an outstanding Award shall not, without the Participant’s consent, materially adversely affect any rights under any Award theretofore granted to a Participant under the Plan. Any change or adjustment to an outstanding Incentive Stock Option shall not, without the consent of the Participant, be made in a manner so as to constitute a “modification” that would cause such Incentive Stock Option to fail to continue to qualify as an Incentive Stock Option. Notwithstanding the foregoing, any adjustments made pursuant to Section 15 shall not be subject to these restrictions.
Section 18. GENERAL
18.1 No Individual Rights
No individual or Eligible Person shall have any claim to be granted any Award under the Plan, and the Company has no obligation for uniformity of treatment of Eligible Persons or Participants under the Plan. Furthermore, nothing in the Plan or any Award granted under the Plan shall be deemed to constitute an employment contract or confer or be deemed to confer on any Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Related Company or limit in any way the right of the Company or any Related Company to terminate a Participant’s employment or other relationship at any time, with or without cause.
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18.2 Issuance of Shares
Notwithstanding any other provision of the Plan, the Company shall have no obligation to issue or deliver any shares of Common Stock under the Plan or make any other distribution of benefits under the Plan unless, in the opinion of the Company’s counsel, such issuance, delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act or the laws of any state or foreign jurisdiction) and the applicable requirements of any securities exchange or similar entity. The Company shall be under no obligation to any Participant to register for offering or resale or to qualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, any shares of Common Stock, security or interest in a security paid or issued under, or created by, the Plan, or to continue in effect any such registrations or qualifications if made. As a condition to the exercise of an Option or any other receipt of Common Stock pursuant to an Award under the Plan, the Company may require:
(a) the Participant to represent and warrant at the time of any such exercise or receipt that such shares are being purchased or received only for the Participant’s own account and without any present intention to sell or distribute such shares and
(b) such other action or agreement by the Participant as may from time to time be necessary to comply with the federal, state and foreign securities laws.
At the option of the Company, a stop-transfer order against any such shares may be placed on the official stock books and records of the Company, and a legend indicating that such shares may not be pledged, sold or otherwise transferred, unless an opinion of counsel (satisfactory to the Company, in its sole discretion) is provided stating that such transfer is not in violation of any applicable law or regulation, may be stamped on stock certificates to ensure exemption from registration. The Committee may also require the Participant to execute and deliver to the Company a purchase agreement or such other agreement as may be in use by the Company at such time that describes certain terms and conditions applicable to the shares. To the extent the Plan or any instrument evidencing an Award provides for issuance of stock certificates to reflect the issuance of shares of Common Stock, the issuance may be effected on a noncertificated basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange.
18.3 Indemnification
Each person who is or shall have been a member of the Board, or a committee appointed by the Board, or an officer of the Company to whom authority was delegated in accordance with Section 3, shall be indemnified and held harmless by the Company against and from any loss, cost, liability or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit or proceeding to which such person may be a party or in which such person may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by such person in settlement thereof, with the Company’s approval, or paid by such person in satisfaction of any judgment in any such claim, action, suit or proceeding against such person; provided, however, that such person shall give the Company an opportunity, at its own expense, to handle and defend the same before such person undertakes to handle and defend it on such person’s own behalf. This duty to indemnify shall not apply to the extent that:
(a) such loss, cost, liability or expense is a result of such person’s own willful misconduct or
(b) such indemnification is expressly prohibited by statute.
The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such person may be entitled under the Company’s certificate of incorporation or bylaws, as a matter of law, or otherwise, or of any power that the Company may have to indemnify or hold harmless.
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18.4 No Rights as a Stockholder
Unless otherwise provided by the Committee or in the instrument evidencing the Award or in a written employment, services or other agreement, no Award, other than a Stock Award, shall entitle the Participant to any cash dividend, voting or other right of a stockholder unless and until the date of issuance under the Plan of the shares that are the subject of such Award.
18.5 Compliance with Laws and Regulations
In interpreting and applying the provisions of the Plan, any Option granted as an Incentive Stock Option pursuant to the Plan shall, to the extent permitted by law, be construed as an “incentive stock option” within the meaning of Section 422 of the Code. Any Award granted pursuant to the Plan is intended to comply with the requirements of Section 409A of the Code, including any applicable regulations and guidance issued thereunder, and including transition guidance, to the extent Section 409A of the Code is applicable thereto, and the terms of the Plan and any Award granted under the Plan shall be interpreted, operated and administered in a manner consistent with this intention to the extent the Committee deems necessary or advisable to comply with Section 409A of the Code and any official guidance issued thereunder. Any payment or distribution that is to be made under the Plan (or pursuant to an Award under the Plan) to a Participant who is a “specified employee” of the Company within the meaning of that term under Section 409A of the Code and as determined by the Committee, on account of a “separation from service” within the meaning of that term under Section 409A of the Code, may not be made before the date which is six months after the date of such “separation from service” unless the payment or distribution is exempt from the application of Section 409A of the Code by reason of the short-term deferral exemption or otherwise. Notwithstanding any other provision in the Plan, the Committee, to the extent it deems necessary or advisable in its sole discretion, reserves the right, but shall not be required, to unilaterally amend or modify the Plan and any Award granted under the Plan so that the Award qualifies for exemption from or complies with Section 409A of the Code; provided, however, that the Committee makes no representations that Awards granted under the Plan shall be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude Section 409A of the Code from applying to Awards granted under the Plan.
18.6 Participants in Other Countries or Jurisdictions
Without amending the Plan, the Committee may grant Awards to Eligible Persons who are foreign nationals on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable to foster and promote achievement of the purposes of the Plan and shall have the authority to adopt such modifications, procedures, subplans and the like as may be necessary or desirable to comply with provisions of the laws or regulations of other countries or jurisdictions in which the Company or any Related Company may operate or have employees to ensure the viability of the benefits from Awards granted to Participants employed in such countries or jurisdictions, meet the requirements that permit the Plan to operate in a qualified or tax-efficient manner, comply with applicable foreign laws or regulations and meet the objectives of the Plan.
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18.7 No Trust or Fund
The Plan is intended to constitute an “unfunded” plan. Nothing contained herein shall require the Company to segregate any monies or other property, or shares of Common Stock, or to create any trusts, or to make any special deposits for any immediate or deferred amounts payable to any Participant, and no Participant shall have any rights that are greater than those of a general unsecured creditor of the Company.
18.8 Successors
All obligations of the Company under the Plan with respect to Awards shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all the business and/or assets of the Company.
18.9 Severability
If any provision of the Plan or any Award is determined to be invalid, illegal or unenforceable in any jurisdiction, or as to any person, or would disqualify the Plan or any Award 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 Committee’s determination, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, person or Award, and the remainder of the Plan and any such Award shall remain in full force and effect.
18.10 Choice of Law and Venue
The Plan, all Awards granted thereunder and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Nevada without giving effect to principles of conflicts of law. Participants irrevocably consent to the nonexclusive jurisdiction and venue of the state and federal courts located in the State of Nevada.
18.11 Legal Requirements
The granting of Awards and the issuance of shares of Common Stock under the Plan are subject to all applicable laws, rules and regulations and to such approvals by any governmental agencies or national securities exchanges as may be required.
Section 19. EFFECTIVE DATE
The effective date (the “Effective Date”)
is the date on which the Plan is adopted by the Board. If the stockholders of the Company do not approve the Plan within 12 months after
the Board’s adoption of the Plan, any Incentive Stock Options granted under the Plan will be treated as Nonqualified Stock Options.
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APPENDIX A
DEFINITIONS
“Acquired Entity” means any entity acquired by the Company or a Related Company or with which the Company or a Related Company merges or combines.
“Award” means any Option, Stock Appreciation Right, Stock Award, Restricted Stock, Stock Unit, Performance Share, Performance Unit, or other incentive payable in shares of Common Stock as may be designated by the Committee from time to time.
“Board” means the Board of Directors of the Company.
“Cause” means, unless otherwise defined in the instrument evidencing an Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, dishonesty, fraud, serious or willful misconduct, unauthorized use or disclosure of confidential information or trade secrets, or conduct prohibited by law (except minor violations), in each case as determined by the Company’s chief human resources officer or other person performing that function or, in the case of directors and executive officers, the Committee, whose determination shall be conclusive and binding.
“Change in Control” means, unless the Committee determines otherwise with respect to an Award at the time the Award is granted or unless otherwise defined for purposes of an Award in a written employment, services or other agreement between the Participant and the Company or a Related Company, the occurrence of any of the following events:
(a) An acquisition by any individual, entity or group, within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act, (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than fifty percent (50%) of either:
(i) the then outstanding shares of Common Stock of the Company (the “Outstanding Common Stock”) or
(ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Voting Securities”);
excluding, however, the following:
(iii) any acquisition directly from the Company, other than an acquisition by virtue of the exercise, exchange or conversion of any Convertible Securities unless such securities were themselves acquired directly from the Company,
(iv) any acquisition by the Company;
(v) any acquisition by any Person pursuant to a transaction which complies with clauses (b)(i), (b)(ii) and (b)(iii) of the definition of Company Transaction; or
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(b) Within any period of 24 consecutive months, a change in the composition of the Board such that the individuals who, immediately prior to such period, constituted the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, for purposes hereof, that any individual who becomes a member of the Board during such period, whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; but, provided further, that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board shall not be so considered as a member of the Incumbent Board; or
(c) A Company Transaction; or
(d) The approval by the stockholders of the Company of a complete liquidation or dissolution of the Company, other than to an entity pursuant to a transaction which would comply with clauses (1), (2) and (3) of the definition of “Company Transaction”, assuming for this purpose that such transaction were a Company Transaction.
For purposes of the definition of “Change of Control” and “Company Transaction”, a series of transactions undertaken with a common purpose shall be treated as a single transaction that begins at the consummation of the first transaction in the series and ends at the consummation of the last transaction in the series.
“Company Transaction” means the consummation of
(a) a reorganization, merger or consolidation of the Company or
(b) the sale or other disposition of all or substantially all of the assets of the Company and its direct and indirect subsidiaries taken as a whole, except in each case a transaction pursuant to which
(i) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Common Stock and Outstanding Voting Securities immediately prior to such transaction will beneficially own, directly or indirectly, more than sixty percent (60%) of, respectively, the outstanding shares of common stock, and the combined voting power of the outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such transaction (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of the Company’s assets, either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such transaction, of the Outstanding Common Stock and Outstanding Voting Securities, as the case may be,
(ii) no person (other than the Company) will beneficially own, directly or indirectly, more than twenty-five percent (25%) of, respectively, the outstanding shares of common stock of the Company resulting from such transaction or the combined voting power of the outstanding voting securities of such Company entitled to vote generally in the election of directors, except to the extent that such ownership existed with respect to the Company prior to the transaction, and
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(iii) individuals who were members of the Board immediately prior to the approval by the stockholders of the Company of such transaction will constitute at least a majority of the members of the board of directors of the Company resulting from such transaction.
“Convertible Security” means any security convertible into or exchangeable for shares of Common Stock of the Company, or any option, warrant or other right to acquire shares of Common Stock of the Company.
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Committee” has the meaning set forth in subsection 3.2.
“Common Stock” means the common stock of the Company.
“Company” means AI Era Corp., a Nevada corporation
“Compensation Committee” means the Compensation Committee (if any) of the Board.
“Disability” means, unless otherwise defined by the Committee for purposes of the Plan or in the instrument evidencing an Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, a mental or physical impairment of the Participant that is expected to result in death or that has lasted or is expected to last for a continuous period of 12 months or more and that causes the Participant to be unable to perform his or her material duties for the Company or a Related Company and to be engaged in any substantial gainful activity, in each case as determined by the Company’s chief human resources officer or other person performing that function or, in the case of directors and executive officers, the Committee, whose determination shall be conclusive and binding.
“Effective Date” has the meaning set forth in Section 19.
“Eligible Person” means any person eligible to receive an Award as set forth in Section 5.
“Entity” means any individual, entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act).
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.
“Fair Market Value” means the closing price for the Common Stock on any given date during regular trading, or if not trading on that date, such price on the last preceding date on which the Common Stock was traded, unless determined otherwise by the Committee using such methods or procedures as it may establish.
“Grant Date” means the later of:
(c) the date on which the Committee completes the corporate action authorizing the grant of an Award or such later date specified by the Committee and
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(d) the date on which all conditions precedent to an Award have been satisfied, provided that conditions to the exercisability or vesting of Awards shall not defer the Grant Date.
“Incentive Stock Option” means an Option granted with the intention that it qualify as an “incentive stock option” as that term is defined for purposes of Section 422 of the Code or any successor provision.
“including”, “include”, “includes” and words of similar import shall be construed broadly as if followed by the phrase “without limitation”.
“Nonqualified Stock Option” means an Option other than an Incentive Stock Option.
“Option” means a right to purchase Common Stock granted under Section 7. .
“Option Expiration Date” means the last day of the maximum term of an Option.
“Outstanding Company Common Stock” has the meaning set forth in the definition of “Change in Control.”
“Outstanding Company Voting Securities” has the meaning set forth in the definition of “Change in Control.”
“Parent Company” means a company or other entity which as a result of a Company Transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries.
“Participant” means any Eligible Person to whom an Award is granted.
“Performance Award” means an Award of Performance Shares or Performance Units granted under Section 11.
“Performance Share” means an Award of units denominated in shares of Common Stock granted under subsection 11.1.
“Performance Unit” means an Award of units denominated in cash or property other than shares of Common Stock granted under subsection 11.2.
“Plan” means this AI Era Corp. 2026 Incentive Plan.
‘‘Related Company” means any entity that is directly or indirectly controlled by, in control of or under common control with the Company.
“Restricted Stock” means an Award of shares of Common Stock granted under Section 10. , the rights of ownership of which are subject to restrictions prescribed by the Committee.
“Retirement” means, unless otherwise defined in the instrument evidencing the Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, retirement as defined for purposes of the Plan by the Committee or the Company’s chief human resources officer or other person performing that function or, if not so defined, means Termination of Service on or after the date the Participant reaches “normal retirement age” as that term is defined in Section 411(a)(8) of the Code.
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“Securities Act” means the Securities Act of 1933, as amended from time to time.
“Stock Appreciation Right” or “SAR” means a right granted under subsection 9.1 to receive the excess of the Fair Market Value of a specified number of shares of Common Stock over the grant price.
“Stock Award” means an Award of shares of Common Stock granted under Section 10, the rights of ownership of which are not subject to restrictions prescribed by the Committee.
“Stock Unit” means an Award denominated in units of Common Stock granted under Section 10.
“Substitute Awards” means Awards granted or shares of Common Stock issued by the Company in substitution or exchange for awards previously granted by an Acquired Entity.
“Successor Company” means the surviving company, the successor company or Parent Company, as applicable, in connection with a Company Transaction.
“Termination of Service” means a termination of employment or service relationship with the Company or a Related Company for any reason, whether voluntary or involuntary, including by reason of death, Disability or Retirement. Any question as to whether and when there has been a Termination of Service for the purposes of an Award and the cause of such Termination of Service shall be determined by the Company’s chief human resources officer or other person performing that function or, with respect to directors and executive officers, by the Committee, whose determination shall be conclusive and binding. Transfer of a Participant’s employment or service relationship between the Company and any Related Company shall not be considered a Termination of Service for purposes of an Award. Unless the Committee determines otherwise, a Termination of Service shall be deemed to occur if the Participant’s employment or service relationship is with an entity that has ceased to be a Related Company. A Participant’s change in status from an employee of the Company or a Related Company to a consultant, advisor or independent contractor of the Company or a Related Company or a change in status from a consultant, advisor or independent contractor of the Company or a Related Company to an employee of the Company or a Related Company, shall not be considered a Termination of Service.
“Vesting Commencement Date” means the Grant Date or such other date selected by the Committee as the date from which an Award begins to vest.
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PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS
SUMMARY PAGE
Date of Board Action |
Action | Section/Effect of Amendment |
Date of Shareholder Approval |
| , 2026 | Initial Plan Adoption | , 2026 |
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