This excerpt taken from the LTEC DEF 14A filed Apr 21, 2006.
APPROVAL OF EQUITY COMPENSATION ARRANGEMENTS
We are seeking shareholder approval of the LOUD Technologies Inc. 2003 Stock Option Plan (the New Plan), formerly known as the Mackie Designs 2003 Stock Option Plan. The New Plan was adopted by the Board of Directors in 2003 without shareholder approval; however, in connection with the listing of our common stock on the Nasdaq Capital Market beginning March 1, 2006, future grants under the New Plan require that our shareholders approve the plan pursuant to NASD Rule 4350(i)(1)(A). Approval of this Proposal also constitutes ratification of all outstanding options granted under the New Plan prior to March 1, 2006. As of April 10, 2006 we had granted and there were outstanding options under the New Plan for the purchase of 284,000 shares of our common stock.
Shareholder approval had not previously been required under our corporate governance policies or under applicable tax laws and regulations because, (i) the New Plan provides only for the award of nonqualified stock options and (ii) at the time the New Plan was adopted , our stock was not listed on the Nasdaq and thus those rules did not apply. Awards previously awarded under the New Plan, as well as options granted under the Mackie Designs 1995 Stock Option Plan (the Prior Plan) will remain outstanding until exercised or terminated in accordance with their terms.