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EXHIBIT 99.1
autobytel.com inc.
2000 STOCK OPTION PLAN
SECTION 1
DEFINITIONS
As used herein, the following terms have the meanings hereinafter
set forth unless the context clearly indicates to the contrary:
(a) "Administrator" means the Board or the Committee;
whichever shall be administering the Plan from time to
time in the discretion of the Board, as described in
Section 3 of this Plan.
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as
amended.
(d) "Committee" means the committee appointed by the Board in
accordance with Section 3 of this Plan.
(e) "Company" means autobytel.com inc., a Delaware
corporation.
(f) "Director" means a member of the Board of Directors of the
Company.
(g) "Employee" means an individual who is employed (within the
meaning of Section 3401 of the Code and the regulations
thereunder) by the Company or any future Parent
Corporation or Subsidiary Corporation of the Company.
(h) "Employer Company" means a company, whether (i) the
Company or a Parent Corporation or Subsidiary Corporation
of the Company, which employs the Employee; or (ii) the
Company or a Parent Corporation or Subsidiary Corporation
of the Company, to which the Service Provider is providing
services or with which Service Provider engages in
business.
(i) "Fair Market Value of Shares" shall mean (i) if the Shares
are not publicly traded on the day in question, the fair
market value of the Shares on the day in question as
determined and set forth in writing by the Administrator
(which, in making such determination, shall make a good
faith effort to establish the true fair market value of
the Shares as of such date using such
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methods as it deems appropriate, including independent
appraisals, and taking into consideration any requirements
set forth in the Code or the regulations thereunder), or
(ii) if the Shares are publicly traded on the day in
question, the closing price of the Shares on the day in
question. The closing price shall be the average of the
highest and lowest quoted selling prices on the New York
Stock Exchange or, if the Shares are not listed or
admitted to trading on such Exchange, on the principal
national securities exchange on which the Shares are
listed or admitted to trading or, if not listed or
admitted to trading on any national securities exchange,
as reported by the Nasdaq Stock Market's National Market
on the day in question, or if the Shares are not listed or
admitted to trading on any national securities exchange or
reported by the Nasdaq Stock Market's National Market, the
closing price of the Shares shall be the average of the
highest and lowest quoted selling prices as reported by
The Wall Street Journal for the over-the-counter market on
the day in question.
(j) "Incentive Stock Option" means an Option for Shares that
is intended to be, designated in writing as, and qualifies
as an Incentive Stock Option within the meaning of Section
422 of the Code.
(k) "Nonstatutory Stock Option" means an Option which is not
an Incentive Stock Option and which is designated as a
Nonstatutory Stock Option by the Administrator.
(l) "Option" means an option to purchase a Share pursuant to
the provisions of this Plan.
(m) "Optionee" means an Employee, Service Provider or Director
to whom an Option has been granted hereunder.
(n) "Option Price" means the price per share of the Shares
subject to each Option as provided in Section 6.4 below.
(o) "Option Term" means the maximum period of time during
which an Option may be exercised as set forth in Section
6.5 below.
(p) "Outside Director" means a Director who is not an
Employee.
(q) "Parent Corporation" shall have the meaning assigned to
that term under Section 424 of the Code.
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(r) "Plan" means the autobytel.com inc. 2000 Stock Option
Plan, the terms of which are set forth herein.
(s) "Service Provider" means any individual who follows an
independent trade, business or profession in which he/she
provides his/her services to the Company or any future
Parent Corporation or Subsidiary Corporation of the
Company, including, without limitation, consultants,
independent contractors and suppliers to the Company.
(t) "Share" or "Shares" means Common Stock of the Company, par
value $.001 per share, or, in the event that the
outstanding Shares are hereafter changed into or exchanged
for different shares or securities of the Company or some
other corporation or other entity, such other shares or
securities.
(u) "Special Committee" means the committee of one or more
members of the Board that may be delegated the authority
to grant options to eligible persons not described in
Section 16 of the Securities Exchange Act of 1934 (the
"Exchange Act").
(v) "Stock Option Agreement" means the agreement described in
Section 6.1 between the Company and the Optionee under
which the Optionee may purchase Shares hereunder.
(w) "Subsidiary Corporation" shall have the meaning assigned
to that term under Section 424 of the Code.
(x) "Total and Permanent Disability," unless otherwise
specified in the applicable Stock Option Agreement, means
the inability of an Employee, Service Provider or Outside
Director to engage in any substantial gainful activity by
reason of any medically determinable physical or mental
impairment which can be expected to result in death or
which has lasted or can be expected to last for a
continuous period of not less than twelve months.
SECTION 2
THE PLAN
2.1. Name. This Plan shall be known as "autobytel.com inc. 2000
Stock Option Plan."
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2.2. Purpose. The purpose of this Plan is to advance the
interests of the Company and its stockholders by affording Employees and Service
Providers of the Employer Company and Outside Directors an opportunity to
acquire or increase their proprietary interest in the Company by the grant to
such individuals of Options under the terms set forth herein.
2.3. Intention.
(a) It is intended that Options (if any) issued as Incentive
Stock Options under this Plan will qualify as incentive stock options under
Section 422 of the Code and the terms of this Plan shall be interpreted in
accordance with such intention.
(b) It is intended that all Options issued to Service Providers
and Outside Directors shall be Nonstatutory Stock Options and that any Options
issued to Employees may be Nonstatutory Stock Options.
SECTION 3
ADMINISTRATION
3.1. Administration. This Plan shall be administered, in the
discretion of the Board from time to time, by the Board or by the Committee
acting as the Administrator. The Committee shall be appointed by the Board, in a
manner consistent with the Company's By-laws, and shall consist of two (2) or
more members, each of whom is an outside director (within the meaning of Code
Section 162(m) and the Treasury Regulations thereunder) as well as a
non-employee director (within the meaning of Rule 16(b)-3 under the Exchange
Act, as amended). The Board may from time to time remove members from, or add
members to, the Committee. The Board shall fill vacancies on the Committee
however caused. The Board may appoint one (1) of the members of the Committee as
Chairman. The Administrator shall hold meetings at such times and places as it
may determine. Acts of a majority of the Administrator at which a quorum is
present, or acts reduced to or approved in writing by the unanimous consent of
the members of the Administrator, shall be the valid acts of the Administrator.
Additionally, and notwithstanding anything to the contrary contained in this
Plan, the Board or Committee may delegate to a committee of one or more members
of the Board the authority to grant options and to specify the terms and
conditions thereof to certain eligible persons who are not subject to the
requirements of Section 16 of the Exchange Act, as amended, in accordance with
guidelines approved by the Board or Committee.
3.2. Duties. The Administrator (or the Special Committee) shall
from time to time at its discretion select the Employees, Service Providers and
Outside Directors who are to be granted Options, determine the number of Shares
to be subject to Options to be granted to each
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Optionee and designate such Options as Incentive Stock Options or Nonstatutory
Stock Options. The interpretation and construction by the Administrator of any
provisions of this Plan or of any Option granted thereunder shall be final. No
member of the Administrator shall be liable for any action or determination made
in good faith with respect to this Plan or any Option granted hereunder.
SECTION 4
PARTICIPATION
4.1. Eligibility. The Optionees shall be such persons
(collectively, "Participants"; individually a "Participant") as the
Administrator (or the Special Committee) may select from among the following
classes of persons, subject to the terms and conditions of Section 4.2 below:
(a) Employees of the Company;
(b) Employees of the Company's Parent Corporations or
Subsidiary Corporations;
(c) Service Providers of the Company and any Parent
Corporation or Subsidiary Corporation; and
(d) Outside Directors, who shall automatically be
eligible to participate in the Plan in accordance
with Section 6.12 below and be eligible to receive
discretionary grants.
4.2. Ten-Percent Stockholders. A Participant who beneficially
owns more than ten percent (10%) of the total combined voting power of all
classes of outstanding stock of the Company, as determined under Sections 422
and 424 of the Code, shall not be eligible to receive an Incentive Stock Option
unless (i) the Option Price of the Shares subject to such Option is at least one
hundred ten percent (110%) of the Fair Market Value of such Shares on the date
of grant and (ii) such Option by its terms is not exercisable after the
expiration of five (5) years from the date of grant.
4.3. Stock Ownership. For purposes of Section 4.2 above, in
determining stock ownership, a Participant's beneficial ownership of any class
of outstanding stock of the Company shall be determined as provided in Rule
16a-1(a) of the Securities and Exchange Commission adopted under the Exchange
Act, and in any event (i) such Participant shall be considered as owning the
stock owned, directly or indirectly, by or for his or her brothers and sisters,
spouse, ancestors and lineal descendants; (ii) stock owned, directly or
indirectly, by or for a corporation, partnership, estate or trust shall be
considered as being owned proportionately by or for its stockholders, partners
or beneficiaries; and (iii) stock with respect to which such Participant holds
an Option shall not be counted.
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4.4. Outstanding Stock. For purposes of Section 4.2 above,
"outstanding stock" shall include all stock actually issued and outstanding
immediately after the grant of the Option to the Optionee. "Outstanding stock"
shall not include shares authorized for issue under outstanding Options held by
the Optionee or by any other person.
SECTION 5
SHARES SUBJECT TO PLAN
5.1. Shares Available for Options. Subject to adjustment pursuant
to the provisions of Section 5.2 hereof, the total number of Shares, which may
be issued upon the exercise of all Options, shall not exceed 3,000,000 Shares.
Such Shares may be either authorized and unissued Shares or issued Shares which
have been reacquired by the Company (pursuant to Section 6.7(d) or otherwise).
If any Option shall expire or terminate for any reason without having been
exercised in full, new Options may be granted covering Shares originally set
aside for the unexercised portion of such expired or terminated Option.
5.2. Adjustments.
(a) Stock Splits and Dividends. Subject to any required
action by the Board, the number of Shares covered by this Plan as provided in
Section 5.1 hereof, the number of Shares covered by each outstanding Option and
the Option Price thereof shall be proportionately adjusted for any increase or
decrease in the number of issued Shares resulting from a recapitalization,
reclassification, subdivision or consolidation of Shares or the payment of a
stock dividend (but only if paid in Shares), a stock split or any other increase
or decrease in the number of issued Shares effected without receipt of
consideration by the Company.
(b) Mergers. Subject to any required action by the Board
and/or stockholders, if the Company shall merge with another corporation and the
Company is the surviving corporation in such merger and under the terms of such
merger the Shares outstanding immediately prior to the merger remain outstanding
and unchanged, each outstanding Option shall continue to apply to the Shares
subject thereto and shall also pertain and apply to any additional securities
and other property, if any, to which a holder of the number of Shares subject to
the Option would have been entitled as a result of the merger.
(c) Adjustment Determination. To the extent that the
foregoing adjustments relate to securities of the Company, such adjustments
shall be made by the Administrator, whose determination shall be conclusive and
binding on all persons. In computing any adjustment under this Section 5.2, any
fractional Share which might otherwise become subject to an Option shall be
eliminated.
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(d) Special Dividends. Subject to any required action by
the Board, the Administrator shall be entitled to determine whether any
adjustment shall be made with respect to the number of Shares covered by this
Plan as provided in Section 5.1 hereof, the number of Shares covered by each
outstanding Option and the Option Price thereof if the Company pays a special or
extraordinary dividend.
SECTION 6
OPTIONS
6.1. Option Grant and Agreement.
(a) The Administrator may from time to time, subject to
the terms of this Plan, grant to any Participant (other than a person who is an
Outside Director) one or more Options but in no event may any such Participant
receive Options under this Plan of more than 500,000 Shares during any one
calendar year; provided, however, that the Special Committee may from time to
time grant Options to eligible persons not described in Section 16 of the
Exchange Act. Each Option grant shall be evidenced by a written Stock Option
Agreement, dated as of the date of grant and executed by the Company and the
Optionee, which Stock Option Agreement shall set forth the number of Options
granted, whether the Options are Incentive Stock Options or Nonstatutory Stock
Options, the Option Price, the Option Term and such other terms and conditions
as may be determined appropriate by the Administrator (or the Special
Committee), provided that such terms and conditions are not inconsistent with
this Plan. The Stock Option Agreement shall incorporate this Plan by reference
and provide that any inconsistencies or disputes shall be resolved in favor of
this Plan language.
(b) Except as provided in Section 6.12 below, grants under
this Plan shall be made by the Administrator or Special Committee selectively
among the Participants and the terms and provisions of such grants and the
agreements evidencing the same (including, without limitation, the form, the
amount, the timing, the exercisability and the vesting schedule of such grants)
need not be uniform, whether or not the Optionees are similarly situated.
Moreover, the Administrator shall be entitled to modify the vesting terms and
provisions of any outstanding Option at any time provided that the Optionee
shall so consent to the modification.
6.2. Conditions with Respect to Non-Statutory Stock Options.
Certain Non-Statutory Stock Options ("Performance Grants") shall be subject to
the following conditions, which conditions shall be stated within the applicable
Stock Option Agreement.
(a) At the time of grant, the Administrator may, in its
discretion, place additional restrictions on Performance Grants requiring that
the Option will vest only if and
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when, or on an accelerated basis if and when, the Common Stock price exceeds a
specific amount. Generally, Performance Grants will be subject to the same
requirements described herein, unless the Administrator decides otherwise.
(b) At the time of grant, the Administrator may, in its
discretion, place additional restrictions on the Performance Grants requiring
that on the exercise of such a grant an Employee will purchase Shares that will
be forfeited if the Optionee terminates employment within a certain number of
years. Additional transferability restrictions may be imposed in connection with
Performance Grants.
6.3. Conditions with Respect to Incentive Stock Options. Each
Incentive Stock Option shall be subject to the following conditions, which
conditions shall be stated within the applicable Stock Option Agreement. Any
Incentive Stock Option which does not comply with these provisions shall not be
considered an Incentive Stock Option and instead shall be considered a
Nonstatutory Option issued under the Plan:
(a) To the extent that the aggregate Fair Market Value of
Shares (determined as of the time an Option is granted) exercisable for the
first time by an Optionee during any calendar year under such Incentive Stock
Option and any other Incentive Stock Option issued by the Company or any
Subsidiary Corporation or Parent Corporation exceeds $100,000, such excess
Incentive Stock Options shall be deemed Nonstatutory Stock Options.
(b) No Incentive Stock Option may be assigned or
transferred by an Optionee other than by will or by the laws of descent and
distribution. During the lifetime of an Incentive Stock Optionee, the Option may
be exercisable only by the Optionee. Transfer of an Incentive Stock Option by
will or by the laws of descent and distribution shall not be effective to bind
the Company unless the Company shall have been furnished with written notice
thereof and an authenticated copy of the will or such other evidence as the
Administrator may deem necessary to establish the validity of the transfer and
the acceptance by the transferee of the terms and conditions of such Incentive
Stock Option. In no event may any incentive stock option become exercisable
later than the date preceding the tenth anniversary date of the grant thereof.
6.4. Option Price. The Option Price shall be determined by the
Administrator (or the Special Committee), subject to any limitations imposed by
this Plan and, in any event, shall not be less than the Fair Market Value on the
date of grant in the case of Incentive Stock Options, and shall not be less than
eighty-five percent (85%) of the Fair Market Value in the case of Nonstatutory
Stock Options. The Option Price for Incentive Stock Options shall not be less
than the Fair Market Value of Shares on the date such Incentive Stock Options
are granted and, in the case of Incentive Stock Options granted to an Optionee
described in Section 4.2 hereof, the Option Price shall not be less than one
hundred ten percent (110%) of the Fair Market Value of Shares on the date of
grant.
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6.5. Option Term. The Option Term shall be determined by the
Administrator (or the Special Committee) at the time of grant, subject to any
limitations imposed by this Plan, but in any event shall not be more than ten
years from the date such Option is granted, and, in the case of an Incentive
Stock Option granted to an Optionee described in Section 4.2 hereof, shall not
be more than five years from the date such Option is granted. Options may be
subject to earlier termination as provided in this Plan.
6.6 Limitations on Exercise of Options. Notwithstanding anything
contained in this Plan to the contrary:
(a) Options may not be exercised until the Plan has been
approved by the stockholders as provided in Section 9.8.
(b) Options shall be exercisable in full or in such equal
or unequal instalments as the Administrator shall determine; provided that if an
Optionee does not purchase all of the Shares which the Optionee is entitled to
purchase on a certain date or within an established instalment period, the
Optionee's right to purchase any unpurchased Shares shall continue during the
Option Term (taking into account any early termination of such Option Term which
may be provided for under the Plan); provided, further that an Optionee who is
not an officer, director or consultant shall have the right to exercise at least
20% of the options granted per year over five (5) years from the grant date.
6.7. Method of Exercising Options; Withholding Tax.
(a) Options shall be exercised by a written notice,
delivered to the Company at its principal office located at 18872 MacArthur
Blvd., Second Floor, Irvine, California, 92612-1400, Attn: Legal Department or
such other address that may be designated by the Company, specifying the number
of Shares to be purchased and tendering payment in full for such Shares. Payment
may be tendered in cash or by certified, bank cashier's or teller's check or by
Shares (valued at Fair Market Value as of the date of tender), or some
combination of the foregoing or such other form of consideration which has been
approved by the Board or the Committee, including any approved cashless exercise
mechanism or a promissory note given by the Optionee. The right to deliver in
full or partial payment of such Option Price any consideration other than cash
shall be limited to such frequency as the Board or the Committee shall determine
in its absolute discretion from time to time. In the event all or part of the
Option Price is paid in Shares, any excess of the value of such Shares over the
Option Price will be returned to the Optionee as follows: (i) any whole Share
remaining in excess of the Option Price will be returned in kind, and may be
represented by one or more share certificates; and (ii) any partial Shares
remaining in excess of the Option Price will be returned in cash.
(b) In the event an Optionee pays all or part of the
Option Price in Shares, the Administrator shall be entitled as it deems
appropriate to award to the Optionee
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additional Options equal to the number of Shares tendered to exercise, provided
such Option has an Option Price equal to Fair Market Value.
(c) In the event the Company determines that it is
required to withhold income tax as a result of the exercise of an Option, as a
condition to the exercise thereof, the Optionee may be required to make
arrangements satisfactory to the Company to enable it to satisfy such
withholding requirements. Payment of such withholding requirements may be made,
in the discretion of the Administrator, (i) in cash, (ii) by delivery of Shares
registered in the name of the Optionee having a Fair Market Value at the time of
exercise equal to the amount to be withheld, (iii) by the Company retaining or
not issuing such number of Shares subject to the Option as have a Fair Market
Value at the time of exercising equal to the amount to be withheld or (iv) any
combination of (i), (ii) and (iii) above.
(d) The Administrator shall be entitled as it deems
appropriate to make available for issuance under this Plan Shares tendered by an
Optionee as payment of the Option Price or Shares used to satisfy the Company's
withholding requirements.
6.8. Rights in the Event of Sale, Merger or Other Reorganization.
Except as expressly provided in Section 5.2 and this Section 6.8, the Optionee
shall have no rights by reason of any subdivision or consolidation of shares of
stock of any class, the payment of any stock dividend or any other increase or
decrease in the number of shares of stock of any class or by reason of any
dissolution, liquidation, merger or consolidation or spin-off of assets or stock
of another corporation, and any issue by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall not
affect, and no adjustment by reason thereof shall be made with respect to, the
number or Option Price of Shares subject to an Option. The grant of an Option
pursuant to this Plan shall not affect in any way the right or power of the
Company to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure, to merge or consolidate or to dissolve,
liquidate, sell or transfer all or any part of its business or assets. In any
such event:
(a) Unless otherwise provided in the Stock Option
Agreement for any given Option, and except as otherwise provided in Section 6.12
as to Outside Directors, upon any such merger (other than a merger in which the
Company is the surviving corporation as described in Section 5.2(b) and under
the terms of which the shares of Common Stock outstanding immediately prior to
the merger remain outstanding and unchanged), consolidation, or sale or transfer
of assets, all rights of the Optionee with respect to the unexercised portion of
any Option shall become immediately vested and may be exercised immediately,
except to the extent that any agreement or undertaking of any party to any such
merger, consolidation, or sale or transfer of assets, shall make specific
provision for the assumption of the obligations of the Company with respect to
this Plan and the rights of Optionees with respect to Options granted
thereunder.
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(b) Unless otherwise provided in the Stock Option
Agreement for any given Option, upon any such liquidation or dissolution, all
rights of the Optionee with respect to the unexercised portion of any Option
shall wholly and completely terminate and all Options shall be canceled at the
time of any such liquidation or dissolution, except to the extent that any plan
pursuant to which such liquidation or dissolution is effected, shall make
specific provision with respect to this Plan and the rights of Optionees with
respect to Options granted thereunder.
(c) Notwithstanding anything to the contrary herein, to
the extent provided in the Stock Option Agreement for any given Option, upon a
change of control (as defined in such Stock Option Agreement), all rights of the
Optionee with respect to the unexercised portion of any Option shall vest and
become exercisable as provided in such Stock Option Agreement upon the effective
date of any such change of control.
Notwithstanding the foregoing, the holder of any such Option or right
theretofore granted and still outstanding shall have the right immediately prior
to the effective date of such merger, consolidation, sale or transfer of assets,
liquidation or dissolution to exercise such Option in whole or in part without
regard to any installment provision that may have been made part of the terms
and conditions of such Option or right; provided, that any conditions precedent
to such exercise set forth in the Stock Option Agreement other than the passage
of time, have occurred or been waived. In no event, however, may any Incentive
Stock Option that becomes exercisable pursuant to this Section 6.8 be exercised,
in whole or in part, later than the date preceding the tenth anniversary date of
the grant thereof.
6.9. Rights in the Event of Death. Unless otherwise provided in
the Stock Option Agreement for any given Option, if an Optionee's employment or
business relationship with or service to the Employer Company or service as a
member of the Board is terminated on account of death, the person or persons who
shall have acquired the right, by will or the laws of descent and distribution,
to exercise the Optionee's Options shall continue to have (subject to Sections
6.3 and 6.6 above) the right, for a period of at least six (6) months from the
date of termination by death or such longer period (if any) as may be specified
in the applicable Stock Option Agreement, to exercise any Options which such
Optionee would have been entitled to exercise on the Optionee's death or during
the first year thereafter. At the expiration of such period any such Options
which remain unexercised shall expire. Unless the Administrator provides
otherwise in the Stock Option Agreement, any Options that could not have been
exercised by an Optionee as of the Optionee's death may not be exercised.
6.10. Rights in the Event of Total and Permanent Disability.
Unless otherwise provided in the Stock Option Agreement for any given Option, if
an Optionee's employment or business relationship with or service to the
Employer Company or service as a member of the Board is terminated on account of
Total and Permanent Disability, the Optionee shall have (subject to Sections 6.3
and 6.6 above) the right, for a period of at least six (6) months from the date
of termination by disability or such longer period (if any) as may be specified
in the
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applicable Stock Option Agreement, to exercise any Options which such Optionee
would have been entitled to exercise on the date of such Optionee's Total and
Permanent Disability. At the expiration of such period any such Options which
remain unexercised shall expire. Unless the Administrator provides otherwise in
the Stock Option Agreement, any Options that could not have been exercised by an
Optionee on the date of such Optionee's Total and Permanent Disability may not
be exercised.
6.11. Rights in the Event of Termination of Employment or
Service. Unless otherwise provided in the Stock Option Agreement for any given
Option, in the event that an Optionee's employment or business relationship with
or service to the Employer Company or service as a member of the Board
terminates, other than by reason of death or Total and Permanent Disability and
other than due to termination for "Cause," the Optionee shall have (subject to
Sections 6.3 and 6.6 above) the right, for a period of at least thirty (30) days
from the date of such termination or such longer period (if any) as may be
specified in the applicable Stock Option Agreement, to exercise any Options
which such Optionee would have been entitled to exercise on the date of such
Optionee's termination. At the expiration of such period any such Options which
remain unexercised shall expire. Unless the Administrator provides otherwise in
the Stock Option Agreement, any Options that could not have been exercised by an
Optionee on the date of such Optionee's termination of employment or service as
a member of the Board or business relationship may not be exercised.
Notwithstanding the foregoing, if the employment or service of or business
relationship with an Optionee is terminated for "Cause" by the Employer Company,
the Company may notify the Optionee that any Options not exercised prior to the
termination are cancelled. For purposes hereof and unless the Administrator
provides otherwise in the Stock Option Agreement, a termination of service or
business relationship for "Cause" shall include dismissal as a result of (1)
Optionee's conviction of any crime or offense involving money or other property
of the Company or its subsidiaries or which constitutes a felony in the
jurisdiction involved; (2) Optionee's gross negligence, gross incompetence or
wilful gross misconduct in the performance of his or her duties; or (3)
Optionee's wilful failure or refusal to perform his or her duties.
6.12. Automatic Option Grants to Outside Directors.
This Section 6.12 shall become effective only after there are no
longer any options that may be granted under the autobytel.com inc. 1999 Stock
Option Plan (the "1999 Stock Option Plan").
(a) First Option. Each person who becomes an Outside Director
after January 1, 2000 shall be automatically granted an Option to purchase
twenty thousand (20,000) Shares (the "First Option") on the date on which such
person first becomes an Outside Director, whether through election by the
stockholders of the Company or appointment by the Board to fill a vacancy;
provided, however, that a Director who is also an Employee ceases to be an
Employee but remains a member of the Board shall not receive the grant of a
First Option.
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(b) Subsequent Option. Each Outside Director shall be
automatically granted an Option to purchase five thousand (5,000) Shares (a
"Subsequent Option") on November 1 of each year; provided that he or she is then
an Outside Director and, provided further, that as of such date, he or she shall
have served on the Board for at least the preceding six (6) months.
(c) Terms of Options. The terms of First Options and Subsequent
Options granted hereunder shall be as follows:
(i) Term. The term of the Option shall be ten (10) years.
(ii) Exercise Price. The exercise price per Share shall be
one hundred percent (100%) of the Fair Market Value on the date of grant. In the
event that the date of grant is not a trading day, the exercise price per Share
shall be the Fair Market Value on the next trading day immediately following the
date of grant.
(iii) Vesting Schedule. Each grant of Shares subject to
the Option shall vest in its entirety and become exercisable on the first
anniversary of the grant date, subject to the Optionee remaining an Outside
Director as of the applicable vesting date.
(iv) Changes in Control of Company. In the event there
occurs a Change in Control of the Company (as hereafter defined) one half (1/2)
of all Shares subject to the Option shall vest and become exercisable upon the
effective date of any such Change in Control.
(v) Definition of "Change in Control." For purposes of the
Plan, "Change in Control" shall be defined as:
A. When any "person" as defined in Section 3(a)(9)
of the Exchange Act and as used in Sections 13(d) and 14(d) thereof (including a
"group" as defined in Section 13(d) of the Exchange Act, but excluding the
Company, any Subsidiary or any employee benefit plan sponsored or maintained by
the Company or any Subsidiary (including any trustee of such plan acting as
trustee), and also excluding Peter R. Ellis or John C. Bedrosian) directly or
indirectly, becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act, as amended from time to time), of securities of the Company
representing 50% or more of the combined voting power of the Company's then
outstanding securities.
B. The individuals who, as of January 1, 2000,
constitute the Board (the "Incumbent Board"), cease for any reason to constitute
at least a majority of the Board; provided however, that any individual becoming
a director subsequent to such date, whose election, or nomination for election
by the Company's stockholders, was approved by a vote of at
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least a majority of the directors then comprising the Incumbent Board shall not,
for purposes of this section, be counted in determining whether the Incumbent
Board constitutes a majority of the Board.
C. Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company or the acquisition of assets of another corporation (a
"Business Combination"), in each case, unless, following such Business
Combination:
i. all or substantially all of the
individuals and entities who were the beneficial owners of the then outstanding
shares of common stock of the Company and the beneficial owners of the combined
voting power of the then outstanding voting securities of the Company entitled
to vote generally in the election of directors immediately prior to such
Business Combination beneficially own, directly or indirectly, more than fifty
percent (50%) of the then outstanding shares of common stock and the combined
voting power of the then outstanding securities entitled to vote generally in
the election of directors, respectively, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or indirectly or
through one or more subsidiaries); and
ii. no person (excluding any employee
benefit plan or related trust of the Company or such corporation resulting from
such Business Combination) beneficially owns, directly or indirectly, fifty
percent (50%) or more of the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined voting
power of the corporation except to the extent that such ownership existed prior
to the Business Combination; or
D. Approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company.
(vi) Stock Option Agreement. Each Option granted to
Outside Directors shall be evidenced by a Stock Option Agreement, which shall
contain such other provisions as may be applicable to such Options under this
Plan.
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SECTION 7
SHARES ISSUED PURSUANT TO AN OPTION
7.1. Issuance of Certificates. The Company shall not be required
to issue or deliver any certificate for Shares purchased upon the exercise of
any Option, or any portion thereof, prior to fulfilment of all of the following
applicable conditions:
(a) The admission of such Shares to listing on all stock
exchanges or markets on which the Shares are then listed to the extent such
admission is necessary;
(b) The completion of any registration or other
qualification of such Shares under any federal or state securities laws or under
the rulings or regulations of the Securities and Exchange Commission or any
other governmental regulatory body, which the Board shall in its sole discretion
deem necessary or advisable, or the determination by the Board in its sole
discretion that no such registration or qualification is required;
(c) The obtaining of any approval or other clearance from
any federal or state governmental agency which the Board shall, in its sole
discretion, determine to be necessary or advisable; and
(d) The lapse of such reasonable period of time following
the exercise of the Option as the Board or Committee from time to time may
establish for reasons of administrative convenience.
7.2. Compliance with Securities and Other Laws. In no event shall
the Company be required to sell, issue or deliver Shares pursuant to Options if
in the opinion of the Company the issuance thereof would constitute a violation
by either the Optionee or the Company of any provision of any law or regulation
of any governmental authority or any securities exchange. As a condition of any
sale or issuance of Shares pursuant to Options, the Company may place legends on
the Shares, issue stop-transfer orders and require such agreements or
undertakings from the Optionee as the Company may deem necessary or advisable to
assure compliance with any such law or regulation, including if the Company or
its counsel deems it appropriate, representations from the Optionee that the
Optionee is acquiring the Shares solely for investment and not with a view to
distribution and that no distribution of the Shares acquired by the Optionee
will be made unless registered pursuant to applicable federal and state
securities laws or unless, in the opinion of counsel to the Company, such
registration is unnecessary.
7.3. Requirements in the Event of a Disposition of Shares. Any
Optionee, or person representing such Optionee, who sells, exchanges, transfers
or otherwise disposes of any Shares acquired pursuant to the exercise of an
Incentive Stock Option within two (2) years
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following the grant of such Incentive Stock Option or within one (1) year
following the actual transfer of such Shares to the Optionee, shall be obligated
to notify the Company in writing of the date of disposition, the number of
Shares so disposed and the amount of consideration received as a result of such
disposition. The Company shall have the right to take whatever reasonable action
it deems appropriate against an Optionee, including early termination of any
Options which remain outstanding, in order to recover any additional taxes the
Company incurs as a result of such Optionee's failure to so notify the Company.
7.4. Legend. All certificates for Shares purchased upon the
exercise of an Incentive Stock Option shall bear a legend indicating that such
Shares were issued pursuant to an Incentive Stock Option grant.
SECTION 8
TERMINATION, AMENDMENT AND MODIFICATION OF PLAN
8.1. Board Termination, Amendment and Modification of Plan. The
Board may at any time amend or modify the Plan; provided, however, that no such
action of the Board, without approval of the stockholders of the Company (in the
same manner as provided in Section 9.8), may:
(a) Increase the number of Shares, which may be issued
under the Plan;
(b) Modify the requirements as to eligibility for
participation in the Plan;
(c) Change the Option Price provisions in Sections 1.(n)
or 6.4 other than to change the manner of determining the Fair Market Value of
the Shares to conform with any then applicable provisions of the Code or
regulations or rulings thereunder, unless such change does not have a materially
adverse effect on the Company; or
(d) Amend this Section 8.1 to defeat its purpose.
Notwithstanding anything above to contrary, the Board shall be entitled adjust
the Option Price with respect to any outstanding Option at any time provided
that the Optionee shall so consent.
8.2. Plan Termination. Unless terminated earlier as provided in
Section 8.1, this Plan shall terminate ten (10) years from the date it is
adopted by the Board and no Option shall be granted under this Plan after such
expiration date. Termination of this Plan shall not alter or impair any of the
rights or obligations under any Option theretofore granted under this Plan
unless the Optionee shall so consent.
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8.3. Effect of Termination, Amendment or Modification of Plan.
Notwithstanding Sections 8.1 and 8.2, no termination, amendment or modification
of this Plan shall in any manner affect any Option theretofore granted under
this Plan without the written consent of the Optionee or a person who shall have
acquired the right to exercise the Option by will or the laws of descent and
distribution.
SECTION 9
MISCELLANEOUS
9.1. Non-assignability of Options. No Option shall be assignable
or transferable by the Optionee except by will or by the laws of descent and
distribution. During the lifetime of the Optionee, the Option shall be
exercisable only by the Optionee.
9.2. Leaves of Absence. Unless the Administrator determines
otherwise, the vesting of an Option granted under this Plan shall not be tolled
during any unpaid leave of absence taken by an Optionee.
9.3. No Rights to Employment or Provide Service. Nothing in this
Plan or in any Option granted hereunder or in any Stock Option Agreement
relating thereto shall confer upon any individual the right to continue
employment with or to provide service to the Employer Company or service as a
member of the Board.
9.4. Purchase Offer. The Administrator may offer to purchase, for
cash or Shares, any Option granted hereunder and such offer to purchase any
Option shall be on such terms and conditions as the Administrator establishes
and communicates to the Optionee at the time the offer is extended to the
Optionee.
9.5. Binding Effect. This Plan shall be binding upon the
successors and assigns of the Company.
9.6. Singular, Plural, Gender. Whenever used herein, except where
the context clearly indicates to the contrary, nouns in the singular shall
include the plural, and the masculine pronoun shall include the feminine gender.
9.7. Headings. Headings of the Sections hereof are inserted for
convenience and reference and constitute no part of this Plan.
9.8. Effective Date; Ratification by Stockholders. This Plan
shall become effective upon its adoption by the Board but is subject to the
approval of the stockholders of the Company within 12 months following such
adoption. If this Plan is not approved by the stock-
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holders this Plan shall become null and void and of no force or effect. Any
Options granted pursuant to the Plan may not be exercised until the Plan shall
have been approved by the stockholders pursuant to this Section.
9.9. Rights as Stockholder. An Optionee or transferee of an
Option shall have no rights as a stockholder with respect to any Shares subject
to such Option prior to the purchase of such Shares by exercise of such Option
as provided herein.
9.10. Applicable Law. This Plan and the Options granted hereunder
shall be interpreted, administered and otherwise subject to the laws of the
State of California, without giving effect to the principles of conflict of laws
thereof.
9.11. Reports. The Company will comply with all applicable
reporting requirements applicable to Incentive Stock Options under the Code.
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