THIS DOCUMENT CONTAINS PART OF A PROSPECTUS COVERING SECRUITIES THAT HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933.
Boston Communications Group, Inc.
2000 STOCK OPTION PLAN
1. Purpose
The purpose of this 2000 Stock Option Plan (the "Plan") of Boston
Communications Group, Inc., a Massachusetts corporation (the "Company"), is to
advance the interests of the Company's stockholders by enhancing the Company's
ability to attract, retain and motivate persons who make (or are expected to
make) important contributions to the Company by providing such persons with
equity ownership opportunities and performance-based incentives and thereby
better aligning the interests of such persons with those of the Company's
stockholders. Except where the context otherwise requires, the term "Company"
shall include any of the Company's present or future subsidiary corporations as
defined in Section 424(f) of the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder (the "Code") and any other business
venture (including, without limitation, joint venture or limited liability
company) in which the Company has a significant interest, as determined by the
Board of Directors of the Company (the "Board").
2. Eligibility
All of the Company's employees, officers, directors, consultants and
advisors (and any individuals who have accepted an offer for employment) are
eligible to be granted options (each, an "Option") under the Plan. Each person
who has been granted an Option under the Plan shall be deemed a "Participant".
3. Administration, Delegation
(a) Administration by Board of Directors. The Plan will be administered by
the Board of Directors of the Company (the "Board"). The Board shall
have authority to grant Options and to adopt, amend and repeal such
administrative rules, guidelines and practices relating to the Plan as
it shall deem advisable. The Board may correct any defect, supply any
omission or reconcile any inconsistency in the Plan or any Option in
the manner and to the extent it shall deem expedient to carry the Plan
into effect and it shall be the sole and final judge of such
expediency. All decisions by the Board shall be made in the Board's
sole discretion and shall be final and binding on all persons having
or claiming any interest in the Plan or in any Option. No director or
person acting pursuant to the authority delegated by the Board shall
be liable for any action or determination relating to or under the
Plan made in good faith.
(b) Delegation to Committees. To the extent permitted by applicable law,
the Board may delegate any or all of its powers under the Plan to one
or more committees or subcommittees of the Board (a "Committee"), each
member of which shall be an "outside director" within the meaning of
Section 162(m) of the Code and a "non-employee director" as defined in
Rule 16b-3 promulgated under the Securities Exchange Act of 1934 (the
"Exchange Act"). All references in the Plan to the "Board" shall mean
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the Board or a Committee of the Board to the extent that the Board's
powers or authority under the Plan have been delegated to such
Committee.
4. Stock Available for Options
(a) Number of Shares. Subject to adjustment under Section 8, Options
may be made under the Plan for up to 500,000 shares of common
stock, $.01 par value per share, of the Company (the "Common
Stock"). If any Option expires or is terminated, surrendered or
canceled without having been fully exercised or is forfeited in
whole or in part or results in any Common Stock not being issued,
the unused Common Stock covered by such Option shall again be
available for the grant of Options under the Plan, subject,
however, in the case of Incentive Stock Options (as hereinafter
defined), to any limitation required under the Code. Shares
issued under the Plan may consist in whole or in part of
authorized but unissued shares or treasury shares.
(b) Per-Participant Limit. Subject to adjustment under Section 8, the
maximum number of shares of Common Stock with respect to which
Options may be granted to any Participant under the Plan shall be
100,000 per calendar year. The per-Participant limit described in
this Section 4(b) shall be construed and applied consistently
with Section 162(m) of the Code ("Section 162(m)").
5. Stock Options
(a) General. The Board may grant options to purchase Common Stock
(each, an "Option") and determine the number of shares of Common
Stock to be covered by each Option, the exercise price of each
Option and the conditions and limitations applicable to the
exercise of each Option, including conditions relating to
applicable federal or state securities laws, as it considers
necessary or advisable. An Option which is not intended to be an
Incentive Stock Option (as hereinafter defined) shall be
designated a "Nonstatutory Stock Option".
(b) Incentive Stock Options. An Option that the Board intends to be
an "incentive stock option" as defined in Section 422 of the Code
(an "Incentive Stock Option") shall only be granted to employees
of the Company and shall be subject to and shall be construed
consistently with the requirements of Section 422 of the Code.
The Company shall have no liability to a Participant, or any
other party, if an Option (or any part thereof) which is intended
to be an Incentive Stock Option is not an Incentive Stock Option.
(c) Exercise Price. The Board shall establish the exercise price at
the time each Option is granted and specify it in the applicable
option agreement, provided, however, that the exercise price
shall be not less than 100% of the fair market value of the
Common Stock, as determined by the Board, at the time the Option
is granted. An option may not be repriced following its grant.
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(d) Duration of Options. Each Option shall be exercisable at such
times and subject to such terms and conditions as the Board may
specify in the applicable option agreement, provided, however,
that no Option will be granted for a term in excess of ten (10)
years.
(e) Exercise of Option. Options may be exercised by delivery to the
Company of a written notice of exercise signed by the proper
person or by any other form of notice (including electronic
notice) approved by the Board together with payment in full as
specified in Section 5(f) for the number of shares for which the
Option is exercised.
(f) Payment Upon Exercise. Common Stock purchased upon the exercise
of an Option granted under the Plan shall be paid
---------------------- for as follows:
i) in cash or by check, payable to the order of the Company;
ii) except as the Board may, in its sole discretion, otherwise
provide in an option agreement, by (i) delivery of an irrevocable
and unconditional undertaking by a creditworthy broker to deliver
promptly to the Company sufficient funds to pay the exercise
price or (ii) delivery by the Participant to the Company of a
copy of irrevocable and unconditional instructions to a
creditworthy broker to deliver promptly to the Company cash or a
check sufficient to pay the exercise price;
iii) by delivery of shares of Common Stock owned by the Participant
valued at their fair market value as determined by (or in a
manner approved by) the Board in good faith ("Fair Market
Value"), provided (i) such method of payment is then permitted
under applicable law and (ii) such Common Stock was owned by the
Participant at least six months prior to such delivery;
iv) to the extent permitted by the Board, in its sole discretion by
(i) delivery of a promissory note of the Participant to the
Company on terms determined by the Board, or (ii) payment of such
other lawful consideration as the Board may determine; or
v) by any combination of the above permitted forms of payment.
(g) Substitute Options. In connection with a merger or consolidation
of an entity with the Company or the acquisition by the Company
of property or stock of an entity, the Board may grant Options in
substitution for any options or other stock or stock-based awards
granted by such entity or an affiliate thereof. Substitute
Options may be granted on such terms as the Board deems
appropriate in the circumstances, notwithstanding any limitations
on Options contained in the other sections of this Section 5.
6. Adjustments for Changes in Common Stock and Certain Other Events
(a) Changes in Capitalization. In the event of any stock split,
reverse stock split, stock dividend, recapitalization,
combination of shares, reclassification of shares, spin-off or
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othersimilar change in capitalization or event, or any
distribution to holders of Common Stock other than a normal
cash dividend, (i) the number and class of securities
available under this Plan, (ii) the per-Participant limit
set forth in Section 4(b), and (iii) the number and class of
securities and exercise price per share subject to each
outstanding Option, shall be appropriately adjusted by the
Company (or substituted Options may be made, if applicable)
to the extent the Board shall determine, in good faith, that
such an adjustment (or substitution) is necessary and
appropriate. If this Section 6(a) applies and Section 6(c)
also applies to any event, Section 6(c) shall be applicable
to such event, and this Section 6a) shall not be applicable.
(b) Liquidation or Dissolution. In the event of a proposed
liquidation or dissolution of the Company, the Board shall upon
written notice to the Participants provide that all then
unexercised Options will (i) become exercisable in full as of a
specified time at least 10 business days prior to the effective
date of such liquidation or dissolution and (ii) terminate
effective upon such liquidation or dissolution, except to the
extent exercised before such effective date.
(c) Acquisition Events
(i) Definition. An "Acquisition Event" shall mean: (a) any merger or
consolidation of the Company with or into another entity as a
result of which the Common Stock is converted into or exchanged
for the right to receive cash, securities or other property or
(b) any exchange of shares of the Company for cash, securities or
other property pursuant to a statutory share exchange
transaction.
(ii) Consequences of an Acquisition Event on Options. Upon the
occurrence of an Acquisition Event, or the execution by the
Company of any agreement with respect to an Acquisition Event,
the Board shall provide that all outstanding Options shall be
assumed, or equivalent options shall be substituted, by the
acquiring or succeeding corporation (or an affiliate thereof).
For purposes hereof, an Option shall be considered to be assumed
if, following consummation of the Acquisition Event, the Option
confers the right to purchase, for each share of Common Stock
subject to the Option immediately prior to the consummation of
the Acquisition Event, the consideration (whether cash,
securities or other property) received as a result of the
Acquisition Event by holders of Common Stock for each share of
Common Stock held immediately prior to the consummation of the
Acquisition Event (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of
a majority of the outstanding shares of Common Stock); provided,
however, that if the consideration received as a result of the
Acquisition Event is not solely common stock of the acquiring or
succeeding corporation (or an affiliate thereof), the Company
may, with the consent of the acquiring or succeeding corporation,
provide for the consideration to be received upon the exercise of
Options to consist solely of common stock of the acquiring or
succeeding corporation (or an affiliate thereof) equivalent in
fair market value to the per share consideration received by
holders of outstanding shares of Common Stock as a result of the
Acquisition Event.
Notwithstanding the foregoing, if the acquiring or succeeding
corporation (or an affiliate thereof) does not agreeto assume, or
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substitute for, such Options, then the Board shall, upon written
notice to the Participants, provide that all then unexercised Options
will become exercisable in full as of a specified time prior to the
Acquisition Event and will terminate immediately prior to the
consummation of such Acquisition Event, except to the extent exercised
by the Participants before the consummation of such Acquisition Event;
provided, however, that in the event of an Acquisition Event under the
terms of which holders of Common Stock will receive upon consummation
thereof a cash payment for each share of Common Stock surrendered
pursuant to such Acquisition Event(the "Acquisition Price"), then the
Board may instead provide that all outstanding Options shall terminate
upon consummation of such Acquisition Event and that each Participant
shall receive, in exchange therefor, a cash payment equal to the
amount (if any) by which (A) the Acquisition Price multiplied by the
number of shares of Common Stock subject to such outstanding Options
(whether or not then exercisable), exceeds (B) the aggregate exercise
price of such Options.
7. General Provisions Applicable to Options
(a) Transferability of Options. Except as the Board may otherwise
determine or provide in an Option, Options shall not be sold,
assigned, transferred, pledged or otherwise encumbered by the
person to whom they are granted, either voluntarily or by
operation of law, except by will or the laws of descent and
distribution, and, during the life of the Participant, shall be
exercisable only by the Participant. References to a Participant,
to the extent relevant in the context, shall include references
to authorized transferees. (b) Documentation. Each Option shall
be evidenced by a written instrument in such form as the Board
shall determine, such written instrument may be in the form of an
agreement signed by the Company and the Participant or a written
confirming memorandum to the Participant from the Company. Each
Option may contain terms and conditions in addition to those set
forth in the Plan.
(c) Board Discretion. Except as otherwise provided by the Plan, each
Option may be made alone or in addition or in ----------------
relation to any other Option. The terms of each Option need not
be identical, and the Board need not treat Participants
uniformly.
(d) Termination of Status. The Board shall determine the effect on an
Option of the disability, death, retirement, authorized leave of
absence or other change in the employment or other status of a
Participant and the extent to which, and the period during which,
the Participant, the Participant's legal representative,
conservator, guardian or Designated Beneficiary may exercise
rights under the Option.
(e) Withholding. Each Participant shall pay to the Company, or make
provision satisfactory to the Board for payment of, any taxes
required by law to be withheld in connection with Options to such
Participant no later than the date of the event creating the tax
liability. Except as the Board may otherwise provide in an
Option, when the Common Stock is registered under the Exchange
Act, Participants may, to the extent then permitted under
applicable law, satisfy such tax obligations in whole or in part
by delivery of shares of Common Stock, including shares retained
from the Option creating the tax obligation, valued at their Fair
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Market Value. The Company may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind
otherwise due to a Participant.
(f) Amendment of Option. The Board may amend, modify or terminate any
outstanding Option, including but not limited to, substituting
therefor another Option of the same or a different type, changing
the date of exercise or realization, and converting an Incentive
Stock Option to a Nonstatutory Stock Option, provided that the
Participant's consent to such action shall be required unless the
Board determines that the action, taking into account any related
action, would not materially and adversely affect the
Participant.
(g) Conditions on Delivery of Stock. The Company will not be
obligated to deliver any shares of Common Stock pursuant to the
Plan or to remove restrictions from shares previously delivered
under the Plan until (i) all conditions of the Option have been
met or removed to the satisfaction of the Company, (ii) in the
opinion of the Company's counsel, all other legal matters in
connection with the issuance and delivery of such shares have
been satisfied, including any applicable securities laws and any
applicable stock exchange or stock market rules and regulations,
and (iii) the Participant has executed and delivered to the
Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any
applicable laws, rules or regulations.
(h) Acceleration. The Board may at any time provide that any Options
shall become immediately exercisable in full or in ------------
part.
8. Miscellaneous
(a) No Right To Employment or Other Status. No person shall have any
claim or right to be granted an Option, and the grant of an
Option shall not be construed as giving a Participant the right
to continued employment or any other relationship with the
Company. The Company expressly reserves the right at any time to
dismiss or otherwise terminate its relationship with a
Participant free from any liability or claim under the Plan,
except as expressly provided in the applicable Option.
(b) No Rights As Stockholder. Subject to the provisions of the
applicable Option, no Participant or Designated Beneficiary shall
have any rights as a stockholder with respect to any shares of
Common Stock to be distributed with respect to an Option until
becoming the record holder of such shares. Notwithstanding the
foregoing, in the event the Company effects a split of the Common
Stock by means of a stock dividend and the exercise price of and
the number of shares subject to such Option are adjusted as of
the date of the distribution of the dividend (rather than as of
the record date for such dividend), then an optionee who
exercises an Option between the record date and the distribution
date for such stock dividend shall be entitled to receive, on the
distribution date, the stock dividend with respect to the shares
of Common Stock acquired upon such Option exercise,
notwithstanding the fact that such shares were not outstanding as
of the close of business on the record date for such stock
dividend.
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(c) Effective Date and Term of Plan. The Plan shall become effective
on the date on which it is adopted by the Board, but no Option
granted to a Participant that is intended to comply with Section
162(m) shall become exercisable, vested or realizable, as
applicable to such Option, unless and until the Plan has been
approved by the Company's stockholders to the extent stockholder
approval is required by Section 162(m) in the manner required
under Section 162(m) (including the vote required under Section
162(m)). No Options shall be granted under the Plan after the
completion of ten years from the earlier of (i) the date on which
the Plan was adopted by the Board or (ii) the date the Plan was
approved by the Company's stockholders, but Options previously
granted may extend beyond that date.
(d) Amendment of Plan. The Board may amend, suspend or terminate the
Plan or any portion thereof at any time, provided that to the
extent required by Section 162(m), no Option granted to a
Participant that is intended to comply with Section 162(m) after
the date of such amendment shall become exercisable, realizable
or vested, as applicable to such Option, unless and until such
amendment shall have been approved by the Company's stockholders
as required by Section 162(m) (including the vote required under
Section 162(m)).
(e) Governing Law. The provisions of the Plan and all Options made
hereunder shall be governed by and interpreted in accordance with
the laws of the Commonwealth of Massachusetts, without regard to
any applicable conflicts of law.
