The Lima Arizona Stock Option and Award Plan is a comprehensive program introduced by Fresco, Inc. It is designed to incentivize and reward employees by granting them certain benefits in the form of stock options and awards. This plan aims to align the interests of employees with the long-term growth and success of the company. Now, let's explore the different types of stock options and awards available under this plan. 1. Stock Options: One of the primary components of the Lima Arizona Stock Option and Award Plan is stock options. These options provide employees with the right to purchase a specific number of company shares at a predetermined price within a specified period. 2. Incentive Stock Option (ISO): The Lima Arizona Stock Option and Award Plan may offer Incentive Stock Options (SOS) to eligible employees. SOS have favorable tax treatment, as any potential gain from exercising the option is taxed as a capital gain rather than ordinary income. 3. Non-Qualified Stock Option (NO): Another type of stock option available under this plan is the Non-Qualified Stock Option (NO). SOS do not qualify for the same tax advantages as SOS. The gain realized upon exercising the option is treated as ordinary income and subject to employment taxes. 4. Restricted Stock Units (RSS): In addition to stock options, the Lima Arizona Stock Option and Award Plan may also include Restricted Stock Units (RSS). RSS represents a promise to provide employees with company shares at a future date, subject to specific vesting conditions. 5. Performance Awards: To reward exceptional performance and achievements, the Lima Arizona Stock Option and Award Plan may include Performance Awards. These awards are granted based on predetermined performance goals, metrics, or targets set by the company. If employees meet or exceed these targets, they may receive additional company shares or cash equivalents. 6. Stock Appreciation Rights (SARS): The plan might also incorporate Stock Appreciation Rights (SARS). SARS provide employees with the opportunity to benefit from the increase in the company's stock price between the date of grant and exercise. Similar to stock options, SARS have a specific exercise price and expiration period. It is important for employees to familiarize themselves with the specific terms, conditions, and restrictions associated with each type of stock option and award under the Lima Arizona Stock Option and Award Plan. These details can be found in the official plan documents provided by Fresco, Inc. It is advisable to consult with a professional financial advisor or the company's HR department for complete information.