The Colorado Proposed Stock Option and Award Plan of Fresco, Inc. is a comprehensive compensation program designed to attract, retain, and motivate talented employees within the organization. This plan offers various types of stock options and awards to eligible participants, providing them with equity ownership and aligning their interests with those of the company. One of the key types of stock options available under this plan is the incentive stock option (ISO). SOS provide qualifying employees with the opportunity to purchase company stock at a predetermined price, known as the exercise price. These options typically have certain tax advantages, as the difference between the exercise price and the fair market value of the stock upon exercise is taxed at a favorable long-term capital gains rate. Another type of stock option offered is the non-qualified stock option (NO). SOS are more flexible than SOS and can be granted to both employees and non-employee directors. Unlike SOS, the income derived from SOS is subject to ordinary income tax rates upon exercise, based on the difference between the exercise price and the fair market value of the stock at that time. In addition to stock options, the Colorado Proposed Stock Option and Award Plan may include other types of awards such as restricted stock units (RSS). RSS are grants of company stock that vest over a specific time period, providing participants with ownership rights in the company. Upon vesting, RSS usually convert into shares of common stock, allowing participants to benefit from any appreciation in the stock price. Performance-based awards may also be a part of the plan. These awards are contingent upon achieving predetermined performance goals and are typically granted in the form of stock options, restricted stock, or performance shares. They serve as incentives for employees to work towards specific objectives, driving the company's growth and value creation. The Colorado Proposed Stock Option and Award Plan of Fresco, Inc. ensures that eligible participants are provided with opportunities for long-term wealth accumulation through equity ownership in the company. By offering various types of stock options and awards, the plan aims to attract and retain talented individuals, motivating them to contribute to the company's success while aligning their interests with those of the shareholders.