The Houston Texas Stock Option Plan of Sunrise Assisted Living, Inc., is a compensation program that offers both Incentive Stock Options (SOS) and Nonqualified Stock Options (SOS) to eligible employees, consultants, and advisers of the company. This plan serves as a valuable tool to attract and retain talented individuals who contribute to the success of Sunrise Assisted Living. Incentive Stock Options (SOS) are a type of stock option granted to employees that provide certain tax advantages. These options are typically offered at a discounted exercise price compared to the fair market value of the company's stock at the time of grant. SOS come with specific eligibility criteria and must adhere to certain rules set by the Internal Revenue Service (IRS). Nonqualified Stock Options (SOS), on the other hand, are stock options that do not qualify for the same tax advantages as SOS. These options may be granted to employees, consultants, and advisers, providing them with the opportunity to purchase company stock at a predetermined exercise price. SOS may be granted at the fair market value of the stock on the date of grant or at a discounted price, depending on the discretion of Sunrise Assisted Living. The Houston Texas Stock Option Plan is designed to incentivize and reward eligible individuals for their contributions to the growth and success of the company. By offering stock options, Sunrise Assisted Living aims to align the interests of employees, consultants, and advisers with those of the shareholders, fostering a sense of ownership and motivation. The plan considers various factors, including job performance, seniority, and contribution to the company's objectives, when determining the number and type of stock options to be granted. The specific terms and conditions of the plan, including vesting schedules and exercise periods, are outlined in the stock option agreements provided to each participant. As with any stock option plan, participants are encouraged to consult with their financial or tax advisers to understand the potential implications and tax consequences associated with exercising their stock options. In summary, the Houston Texas Stock Option Plan of Sunrise Assisted Living, Inc., encompasses both Incentive Stock Options (SOS) and Nonqualified Stock Options (SOS) to provide eligible employees, consultants, and advisers with an opportunity to share in the company's success and align their interests with those of the shareholders. It is designed to attract, retain, and motivate key individuals who contribute to the growth and achievements of Sunrise Assisted Living.