The Missouri Stock Option Agreement is a legal contract of Quantum Effect Devices, Inc. (QED) that outlines the terms and conditions governing the granting and exercise of stock options to its employees. This agreement enables employees to purchase a specific number of shares of QED's stock at a predetermined price (the exercise price) within a designated timeframe. The Missouri Stock Option Agreement plays a crucial role in incentivizing and rewarding employees, aligning their interests with the company's growth. It is designed to attract and retain talent by offering them the opportunity to participate in QED's financial success and potential upside through stock ownership. There are several types of Missouri Stock Option Agreements available at Quantum Effect Devices, Inc., ensuring flexibility and catering to different employee needs. These may include: 1. Non-Qualified Stock Options (Nests): These stock options do not qualify for certain tax benefits and are typically granted to key employees, executives, or consultants. Nests offer employees the ability to purchase shares at a set price and may be exercised at any time during the specified vesting period. 2. Incentive Stock Options (SOS): SOS are a specialized type of stock option that confer various tax advantages upon exercise. They must adhere to specific requirements laid out by the Internal Revenue Service (IRS), such as limited exercise price, holding periods, and employee eligibility. SOS are often granted to employees in higher positions to encourage long-term commitment and align their interests with the company's success. 3. Restricted Stock Units (RSS): While not strictly categorized as stock options, RSS are another type of equity-based compensation offered by QED. RSS grant employees a specific number of company shares once vesting requirements are met. These shares are typically subject to a vesting schedule and various conditions, ensuring that employees stay with the company to receive the full benefit of their RSS. It is essential to consult legal and financial experts for a comprehensive understanding of the Missouri Stock Option Agreement, as it may vary in specific provisions and legal compliance requirements. The terms, exercise price, vesting, and other conditions will be negotiated and agreed upon between QED and the eligible employees.