================================================================
MERCHANTONLINE.COM, INC.
2000 EQUITY INCENTIVE PLAN
================================================================
AS APPROVED BY THE BOARD OF DIRECTORS ON FEBRUARY 21, 2000
1. PURPOSE. The purpose of the MerchantOnline.com, Inc. 2000 Equity
Incentive Plan (the "Plan") is to advance the interests of MerchantOnline.com,
Inc., a Florida corporation and its subsidiaries (the "Company"), by providing
an additional incentive to attract, retain and motivate highly qualified and
competent persons who are key to the Company, and upon whose efforts and
judgment the success of the Company and its subsidiaries is largely dependent,
including key employees, consultants, independent contractors, advisory board
members, officers and directors, by authorizing the grant of awards of Common
Stock and options to purchase Common Stock of the Company to persons who are
eligible to participate hereunder, thereby encouraging stock ownership in the
Company by such persons, all upon and subject to the terms and conditions of
this Plan.
2. DEFINITIONS. As used herein, the following terms shall have the
meanings indicated:
(a) "Award" means any grant or sale pursuant to the Plan of
Options, Restricted Stock, or Stock Grants.
(b) "Award Agreement" means an agreement between the Company and
the recipient of an Award, setting forth the terms and conditions of the Award.
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Cause" shall mean any of the following:
(i) a determination by the Company that there has been a
willful, reckless or grossly negligent failure by the Participant to perform his
or her duties as an employee of the Company;
(ii) a determination by the Company that there has been a
willful breach by the Optionee of any of the material terms or provisions of any
employment agreement between such Optionee and the Company;
(iii) any conduct by the Optionee that either results in
his or her conviction of a felony under the laws of the United States of America
or any state thereof;
(iv) a determination by the Company that the Optionee has
committed an act or acts involving fraud, embezzlement, misappropriation, theft,
breach of fiduciary duty or material dishonesty against the Company, its
properties or its personnel;
(v) a determination by the Company that there has been a
willful, reckless or grossly negligent failure by the Optionee to comply with
any rules, regulations, policies or procedures of the Company, or that the
Optionee has engaged in any act, behavior or conduct demonstrating a deliberate
<PAGE>
and material violation or disregard of standards of behavior that the Company
has a right to expect of its employees; or
(vi) if the Optionee, while employed by the Company and
for two years thereafter (or such shorter period as may be stated in any
employment, confidentiality or noncompete agreement with the Optionee), violates
a confidentiality and/or noncompete agreement with the Company, or fails to
safeguard, divulges, communicates, uses to the detriment of the Company or for
the benefit of any person or persons, or misuses in any way, any Confidential
Information;
provided, however, that, if the Optionee has entered into a written employment
agreement with the Company which remains effective and which expressly provides
for a termination of such Optionee's employment for "cause," the term "Cause"
for purposes of this Plan shall have the meaning as set forth in the Optionee's
employment agreement in lieu of the definition of "Cause" set forth in this
Section 2(d).
(e) "Change of Control" shall mean the acquisition by any person
or group (as that term is defined in the Securities Exchange Act of 1934 (the
"Exchange Act"), and the rules promulgated pursuant to that act) in a single
transaction or a series of transactions of 40% or more in voting power of the
outstanding stock of the Company and a change of the composition of the Board of
Directors so that, within one year after the acquisition took place, a majority
of the members of the Board of Directors of the Company, or of any corporation
with which the Company may be consolidated or merged, are persons who were not
directors or officers of the Company or one of its Subsidiaries immediately
prior to the acquisition, or to the first of a series of transactions which
resulted in the acquisition of 40% or more in voting power of the outstanding
stock of the Company.
(f) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(g) "Committee" shall mean the stock option or compensation
committee appointed by the Board or, if not appointed, the Board.
(h) "Common Stock" shall mean the Company's Common Stock, par
value $.001 per share.
(i) "Confidential Information" shall mean any and all information
pertaining to the Company's financial condition, clients, customers, prospects,
sources of prospects, customer lists, trademarks, trade names, service marks,
service names, "know-how," trade secrets, products, services, details of client
or consulting contracts, management agreements, pricing policies, operational
methods, site selection, results of operations, costs and methods of doing
business, owners and ownership structure, marketing practices, marketing plans
or strategies, product development techniques or plans, procurement and sales
activities, promotion and pricing techniques, credit and financial data
concerning customers and business acquisition plans, that is not generally
available to the public.
(j) "Director" shall mean a member of the Board.
2
<PAGE>
(k) "Employee" shall mean any person, including Officers,
Directors, consultants and independent contractors, who is either employed or
engaged by the Company or any parent or Subsidiary of the Company within the
meaning of Code Section 3401(c) or the regulations promulgated thereunder. For
purposes of any Non-Qualified Option only, any Officer or Director of the
Company shall be considered an Employee even if he or she is not an employee
with the meaning of the first sentence of this section.
(l) "Fair Market Value" of a Share on any date of reference shall
be the Closing Price of a share of Common Stock on the business day immediately
preceding such date, unless the Committee in its sole discretion shall determine
otherwise in a fair and uniform manner. For this purpose, the "Closing Price" of
the Common Stock on any business day shall be (i) if the Common Stock is listed
or admitted for trading on any United States national securities exchange, the
last reported sale price of the Common Stock on such exchange or reporting
system, as reported in any newspaper of general circulation, (ii) if the Common
Stock is quoted on Nasdaq or any similar system of automated dissemination of
quotations of securities prices in common use, the closing sales price or, if
not available the mean between the closing high bid and low asked quotations for
such day of the Common Stock on such system, or (iii) if neither clause (i) nor
(ii) is applicable, the mean between the high bid and low asked quotations for
the Common Stock as reported by the National Quotation Bureau, Incorporated if
at least two securities dealers have inserted both bid and asked quotations for
the Common Stock on at least five of the 10 preceding days. If the information
set forth in clauses (i) through (iii) above is unavailable or inapplicable to
the Company (e.g., if the Company's Common Stock is not then publicly traded or
quoted), then the "Fair Market Value" of a Share shall be the fair market value
(i.e., the price at which a willing seller would sell a Share to a willing buyer
when neither is acting under compulsion and when both have reasonable knowledge
of all relevant facts) of a share of the Common Stock on the business day
immediately preceding such date as the Committee in its sole and absolute
discretion shall determine in a fair and uniform manner.
(m) "Grant Date" means the date as of which an Option is granted,
as determined under Section 4(a)(i).
(n) "Incentive Stock Option" shall mean an incentive stock option
as defined in Section 422 of the Code.
(o) "Non-Employee Directors" shall have the meaning set forth in
Rule 16b-3(b)(3)(i) under the Securities Exchange Act of 1934, as amended.
(p) "Non-Statutory Stock Option" or "Nonqualified Stock Option"
shall mean an Option which is not an Incentive Stock Option.
(q) "Officer" shall mean the Company's chairman, chief executive
officer, president, principal financial officer, principal accounting officer
(or, if there is no such accounting officer, the controller), any vice-president
of the Company in charge of a principal business unit, division or function
(such as sales, administration or finance), any other officer who performs a
policy-making function, or any other person who performs similar policy-making
functions for the Company. Officers of Subsidiaries shall be deemed Officers of
the Company if they perform such policy-making functions for the Company. As
used in this paragraph, the phrase "policy-making function" does not include
3
<PAGE>
policy-making functions that are not significant. Unless specified otherwise in
a resolution by the Board, an "executive officer" pursuant to Item 401(b) of
Regulation S-K (17 C.F.R. ss.229.401(b)) shall be only such person designated as
an "Officer" pursuant to the foregoing provisions of this paragraph.
(r) "Option" (when capitalized) shall mean any stock option
granted under this Plan.
(s) "Optionee" shall mean a Participant to whom an Option is
granted under this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
(t) Participant means any holder of an outstanding Award under
the Plan.
(u) "Plan" shall mean this 2000 Equity Incentive Plan of the
Company, which Plan shall be effective upon approval by the Board, subject to
approval, within 12 months of the date thereof by holders of a majority of the
Company's issued and outstanding Common Stock of the Company.
(v) "Restricted Stock" means a grant or sale of shares of Common
Stock to the Participant subject to a Risk of Forfeiture.
(w) "Restriction Period" means the period of time during which
any grant of Restricted Stock remains at Risk of Forfeiture as described in
Section 4(d) and the applicable Award Agreement.
(x) "Risk of Forfeiture" means a limitation on the right of the
Participant to retain an Award of Restricted Stock, including a right in the
Company to reacquire the Shares at less than their then Fair Market Value,
arising because of the occurrence or non-occurrence of specified events or
conditions.
(y) Stock Grant means the grant of shares of Common Stock not
subject to restrictions or other forfeiture conditions.
(z) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(aa) "Securities Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended.
(bb) "Share" or "Shares" shall mean a share or shares, as the case
may be, of the Common Stock, as adjusted in accordance with Section 10 of this
Plan.
(cc) "Subsidiary" shall mean any corporation (other than the
Company) in any unbroken chain of corporations beginning with the Company if, at
the time of the granting of the Option, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
4
<PAGE>
(dd) Ten Percent Owner means a person who owns, or is deemed
within the meaning of Section 422(b)(6) of the Code to own, stock possessing
more than 10% of the total combined voting power of all classes of stock of the
Company. Whether a person is a Ten Percent Owner shall be determined with
respect to each Option based on the facts existing immediately prior to the
grant date of such Option.
3. SHARES AND OPTIONS. At no time shall the number of shares of Common
Stock issued pursuant to or subject to outstanding Awards granted under the Plan
exceed 5,000,000 shares of Common Stock; subject, however, to the provisions of
Section 10 of the Plan. Shares of Common Stock issued pursuant to the Plan may
be either authorized but unissued shares or shares held by the Company in its
treasury. For purposes of applying the foregoing limitation, if any Option
expires, terminates, or is cancelled for any reason without having been
exercised in full, or any Award of Restricted Stock should be forfeited by the
recipient thereof, the shares not purchased by the Optionee or forfeited by such
a recipient shall again be available for Awards thereafter to be granted under
the Plan. If any Option granted under this Plan shall terminate, expire, or be
canceled, forfeited or surrendered as to any Shares, the Shares relating to such
lapsed Option shall be available for issuance pursuant to new Options
subsequently granted under this Plan. Upon the grant of any Option hereunder,
the authorized and unissued Shares to which such Option relates shall be
reserved for issuance to permit exercise under this Plan. An Option granted
hereunder shall be either an Incentive Stock Option or a Non-Statutory Stock
Option as determined by the Committee at the time of grant of such Option and
shall clearly state whether it is an Incentive Stock Option or Non-Statutory
Stock Option. All Incentive Stock Options shall be granted within 10 years from
the effective date of this Plan. Awards of Incentive Options granted prior to
shareholder approval of the Plan are hereby expressly conditioned upon such
approval, but in the event of the failure of the shareholders to approve the
Plan shall thereafter and for all purposes be deemed to constitute Non-Statutory
Options.
4. SPECIFIC TERMS OF AWARDS.
(a) OPTIONS.
(i) DATE OF GRANT. The granting of an Option shall take
place at the time specified in the Award Agreement. Only if expressly so
provided in the applicable Award Agreement shall the Grant Date be the date on
which the Award Agreement shall have been duly executed and delivered by the
Company and the Optionee.
(ii) EXERCISE PRICE. The price at which shares may be
acquired under each Incentive Option shall be not less than 100% of the Fair
Market Value of Common Stock on the Grant Date, or not less than 110% of the
Fair Market Value of Common Stock on the Grant Date if the Optionee is a Ten
Percent Owner. The price at which shares may be acquired under each
Non-Statutory Option shall not be so limited solely by reason of this Section.
(iii) OPTION PERIOD. No Incentive Option may be exercised
on or after the tenth anniversary of the Grant Date, or on or after the fifth
anniversary of the Grant Date if the Optionee is a Ten Percent Owner. The Option
period under each Non-Statutory Option shall not be so limited solely by reason
of this Section.
5
<PAGE>
(iv) EXERCISABILITY. An Option may be immediately
exercisable or become exercisable in such installments, cumulative or
non-cumulative, as the Committee may determine. In the case of an Option not
otherwise immediately exercisable in full, the Committee may accelerate the
exercisability of such Option in whole or in part at any time, provided the
acceleration of the exercisability of any Incentive Option would not cause the
Option to fail to comply with the provisions of Section 422 of the Code.
(v) TERMINATION OF ASSOCIATION WITH THE COMPANY. Unless
the Committee shall provide otherwise in the grant of a particular Option under
the Plan, if the Optionee's employment or other association with the Company and
its Affiliates is terminated, whether voluntarily or otherwise, any outstanding
Option of the Optionee shall cease to be exercisable in any respect not later
than ninety (90) days following such termination and, for the period it remains
exercisable following termination, shall be exercisable only to the extent
exercisable at the date of termination, provided that if the termination is for
Cause, then the Option shall terminate on the date of termination. Military,
sick or other bona fide leave shall not be deemed a termination of employment or
other association, provided that it does not exceed the longer of ninety (90)
days or the period during which the absent Optionee's reemployment rights, if
any, are guaranteed by statute or by contract. The Committee in its sole
discretion may, by giving written notice ("cancellation notice"), cancel
effective upon the date of the consummation of any corporate transaction
described in Subsection 5(c) hereof, any Option that remains unexercised on such
date. Such cancellation notice shall be given a reasonable period of time prior
to the proposed date of such cancellation and may be given either before or
after approval of such corporate transaction.
(vi) EXERCISE OF OPTION. An Option may be exercised by the
Optionee giving written notice, to the Company, specifying the number of shares
with respect to which the Option is then being exercised. The notice shall be
accompanied by payment in the form of cash, or certified or bank check payable
to the order of the Company in an amount equal to the exercise price of the
shares to be purchased or, if the Committee had so authorized on the grant of
any particular Option hereunder (and subject such conditions, if any, as the
Committee may deem necessary to avoid adverse accounting effects to the Company)
by delivery of shares of Common Stock held at least six (6) months which have a
Fair Market Value equal to the exercise price of the shares to be purchased.
Payment of any exercise price may also be made through and under the terms and
conditions of any formal cashless exercise program maintained by the Company if
the Stock becomes traded on an established market. Receipt by the Company of
such notice and payment shall constitute the exercise of the Option. Within 30
days thereafter but subject to the remaining provisions of the Plan, the Company
shall deliver or cause to be delivered to the Optionee or his agent a
certificate or certificates for the number of shares then being purchased. Such
shares shall be fully paid and nonassessable.
(vii) LIMIT ON INCENTIVE OPTION CHARACTERIZATION. An
Incentive Option shall be considered to be an Incentive Option only to the
extent that the number of shares of Common Stock for which the Option first
becomes exercisable in a calendar year do not have an aggregate Fair Market
Value (as of the date of the grant of the Option) in excess of the "current
limit". The current limit for any Optionee for any calendar year shall be
$100,000 minus the aggregate Fair Market Value at the date of grant of the
number of shares of Common Stock available for purchase for the first time in
the same year under each other Incentive Option previously granted to the
Optionee under the Plan, and under each other incentive stock option previously
6
<PAGE>
granted to the Optionee under any other incentive stock option plan of the
Company and its Affiliates. Any shares of Common Stock which would cause the
foregoing limit to be violated shall be deemed to have been granted under a
separate Non-Statutory Option, otherwise identical in its terms to those of the
Incentive Option.
(viii) NOTIFICATION OF DISPOSITION. Each person exercising
any Incentive Option granted under the Plan shall be deemed to have covenanted
with the Company to report to the Company any disposition of such shares prior
to the expiration of the holding periods specified by Section 422(a)(1) of the
Code and, if and to the extent that the realization of income in such a
disposition imposes upon the Company federal, state, local or other withholding
tax requirements, or any such withholding is required to secure for the Company
an otherwise available tax deduction, to remit to the Company an amount in cash
sufficient to satisfy those requirements.
(ix) OTHER CONDITIONS. In granting Options, the Committee
shall take into consideration the contribution the person has made, or is
expected to make, to the success of the Company or its Subsidiaries and such
other factors as the Committee shall determine. The Committee shall also have
the authority to consult with and receive recommendations from Officers and
other personnel of the Company and its Subsidiaries with regard to these
matters. The Committee may from time to time in granting Options under this Plan
prescribe such terms and conditions concerning such Options as it deems
appropriate, including, without limitation, (i) the exercise price or prices of
the Option or any installments thereof, (ii) prescribing the date or dates on
which the Option becomes and/or remains exercisable, (iii) providing that the
Option vests or becomes exercisable in installments over a period of time,
and/or upon the attainment of certain stated standards, specifications or goals,
(iv) relating an Option to the continued employment of the Optionee for a
specified period of time, or (v) conditions or termination events with respect
to the exercisability of any Option, provided that such terms and conditions are
not more favorable to an Optionee than those expressly permitted herein;
provided, however, that to the extent not canceled pursuant to Section 4(a)(v)
hereof, upon a Change of Control, any Options that have not yet vested shall
vest upon such Change of Control. The Options granted to employees under this
Plan shall be in addition to regular salaries, pension, life insurance or other
benefits related to their employment with the Company or its Subsidiaries.
Neither this Plan nor any Option granted under this Plan shall confer upon any
person any right to employment or continuance of employment (or related salary
and benefits) by the Company or its Subsidiaries.
(b) RESTRICTED STOCK.
(i) PURCHASE PRICE. Shares of Restricted Stock shall be
issued under the Plan for such consideration, in cash, other property or
services, as is determined by the Committee.
(ii) ISSUANCE OF CERTIFICATES. Each Participant receiving
a Restricted Stock Award, subject to subsection (iii) below, shall be issued a
stock certificate in respect of such shares of Restricted Stock. Such
certificate shall be registered in the name of such Participant, and, if
applicable, shall bear an appropriate legend referring to the terms, conditions,
and restrictions applicable to such Award substantially in the following form:
7
<PAGE>
"The transferability of this certificate and the shares represented by
this certificate are subject to the terms and conditions of
MerchantOnline.com, Inc. 2000 Equity Incentive Plan and an Award
Agreement entered into by the registered owner and MerchantOnline.com,
Inc. Copies of such Plan and Agreement are on file in the offices of
MerchantOnline.com, Inc."
(iii) ESCROW OF SHARES. The Committee may require that the
stock certificates evidencing shares of Restricted Stock be held in custody by a
designated escrow agent (which may but need not be the Company) until the
restrictions thereon shall have lapsed, and that the Participant deliver a stock
power, endorsed in blank, relating to the Stock covered by such Award.
(iv) Restrictions and Restriction Period. During the
period established by the Committee and set forth in the Award Agreement, i.e.,
the Restriction Period, Restricted Stock shall be subject to limitations on
transferability and a Risk of Forfeiture (which may take the form of a right of
the Company to repurchase the Restricted Stock for such consideration, if any,
as the Committee shall have determined at grant) arising on the basis of such
conditions, related to the performance of services, Company or Affiliate
performance or otherwise, as the Committee may determine. Any such Risk of
Forfeiture may be waived, or the Restriction Period shortened, at any time by
the Committee on such basis as it deems appropriate.
(v) RIGHTS PENDING LAPSE OF RISK OF FORFEITURE OR
FORFEITURE OF AWARD. Except as otherwise provided in the Plan, at all times
prior to lapse of any Risk of Forfeiture applicable to, or forfeiture of, an
Award of Restricted Stock, the Participant shall have all of the rights of a
stockholder of the Company, including the right to vote the shares, and the
right to receive any dividends with respect to the shares of Restricted Stock.
The Committee, as determined at the time of Award, may permit or require the
payment of cash dividends to be deferred and, if the Committee so determines,
reinvested in additional Restricted Stock to the extent shares are available
under Section 3.
(vi) EFFECT OF TERMINATION OF EMPLOYMENT OR ASSOCIATION.
Unless otherwise determined by the Committee at or after grant and subject to
the applicable provisions of the Award Agreement, upon termination of a
Participant's employment or other association with the Company and its
Affiliates for any reason during the Restriction Period, all shares of
Restricted Stock still subject to Risk of Forfeiture shall be forfeited or
subject to the Company's right of repurchase (as determined from the form of the
Risk of Forfeiture); provided, however, that military, sick or other bona fide
leave shall not be deemed a termination of employment or other association, if
it does not exceed the longer of ninety (90) days or the period during which the
absent Participant's reemployment rights, if any, are guaranteed by statute or
by contract.
(vii) LAPSE OF RESTRICTIONS. If and when the Restriction
Period expires without a prior forfeiture of the Restricted Stock, the
certificates for such shares shall be delivered to the Participant promptly if
not theretofore so delivered.
(c) STOCK GRANTS. Stock Grants shall be awarded solely in
recognition of significant contributions to the success of the Company or its
8
<PAGE>
Affiliates, in lieu of compensation otherwise already due and in such other
limited circumstances as the Committee deems appropriate. Stock Grants shall be
made without forfeiture conditions of any kind.
5. ADJUSTMENT OF SHARES.
(a) STOCK DIVIDEND, ETC. In the event of any distribution on
Stock payable in Stock or any split-up or contraction in the number of shares of
Stock after the date of an Award Agreement evidencing an Award, the remaining
number of shares of Stock subject to such Award and the price to be paid for any
share subject to the Award, if any, shall be proportionately adjusted.
(b) STOCK RECLASSIFICATION. In the event of any reclassification
or change of outstanding shares of Stock, immediately thereafter (and subject to
further adjustment for subsequent events) any outstanding Award shall thereafter
relate to shares of stock or other securities equivalent in kind and value to
those shares which the Participant would have received if he or she had held of
record the full remaining number of shares of Stock subject to the Award
immediately prior to such reclassification or change.
(c) CONSOLIDATION OR MERGER. Subject to the remainder of this
Section 5(c), in the event of any consolidation or merger of the Company with or
into another company or in case of any sale or conveyance to another company or
entity of the property of the Company as a whole or substantially as a whole,
immediately thereafter (and subject to further adjustment for subsequent events)
any outstanding Award shall thereafter relate to shares of stock or other
securities equivalent in kind and value to those shares and other securities the
Participant would have received if he or she had held of record the full
remaining number of shares of Stock subject to the Award immediately prior to
such consolidation, merger, sale or conveyance. However, unless any Award
Agreement evidencing the grant of an Option shall provide different or
additional terms, in any such transaction the Committee, in its discretion, may
provide instead that any outstanding Option shall terminate, to the extent not
exercised by the Optionee prior to termination, either (a) at the close of a
period of not less than ten (10) days specified by the Committee and commencing
on the Committee's delivery of written notice to the Optionee of its decision to
terminate such Option without payment of consideration as provided in the
following clause or (b) as of the date of the transaction, in consideration of
the Company's payment to the Optionee of an amount of cash equal to difference
between the aggregate Fair Market Value of the shares of Stock for which the
Option is then exercisable and the aggregate exercise price for such shares
under the Option.
(d) OTHER. In the event of any corporate action not specifically
covered by the preceding Sections, including but not limited to an extraordinary
cash distribution on Stock, a corporate separation or other reorganization or
liquidation, the Committee may make such adjustment of outstanding Awards and
their terms, if any, as it, in its sole discretion, may deem equitable and
appropriate in the circumstances.
(e) RELATED MATTERS. Any adjustment in Awards made pursuant to
this Section 5 shall be determined and made, if at all, by the Committee and
shall include any correlative modification of terms, including of option
exercise prices, Risks of Forfeiture and applicable repurchase prices for
9
<PAGE>
Restricted Stock, which the Committee may deem necessary or appropriate so as to
ensure the rights of the Participants in their respective Awards are not
substantially diminished nor enlarged as a result of the adjustment and
corporate action. No fraction of a share shall be purchasable or deliverable
upon exercise, but in the event any adjustment hereunder of the number of shares
covered by an Award shall cause such number to include a fraction of a share,
such number of shares shall be adjusted to the nearest smaller whole number of
shares. In the event of changes in the outstanding Stock by reason of any stock
dividend, split-up, contraction, reclassification, or change of outstanding
shares of Stock of the nature contemplated by this Section 5, the number and
kind of shares of Stock available for the purposes of the Plan as stated in
Section 3 shall be correspondingly adjusted.
(f) Except as otherwise expressly provided herein, the issuance
by the Company of shares of its capital stock of any class, or securities
convertible into or exchangeable for shares of its capital stock of any class,
either in connection with a direct or underwritten sale or upon the exercise of
rights or warrants to subscribe therefor or purchase such Shares, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with respect to, the number of or exercise price of Shares then subject
to outstanding Options granted under this Plan.
(g) Without limiting the generality of the foregoing, the
existence of outstanding Awards granted under this Plan shall not affect in any
manner the right or power of the Company to make, authorize or consummate (i)
any or all adjustments, reclassifications, recapitalizations, reorganizations or
other changes in the Company's capital structure or its business; (ii) any
merger or consolidation of the Company or to which the Company is a party; (iii)
any issuance by the Company of debt securities, or preferred or preference stock
that would rank senior to or above the Shares subject to outstanding Awards;
(iv) any purchase or issuance by the Company of Shares or other classes of
Common Stock or common equity securities; (v) the dissolution or liquidation of
the Company; (vi) any sale, transfer, encumbrance, pledge or assignment of all
or any part of the assets or business of the Company; or (vii) any other
corporate act or proceeding, whether of a similar character or otherwise.
(h) The Participant shall receive written notice within a
reasonable time prior to the consummation of such action advising the
Participant of any of the foregoing. The Committee may, in the exercise of its
sole discretion, in such instances declare that any Option shall terminate as of
a date fixed by the Board and give each Optionee the right to exercise his or
her Option.
6. NONTRANSFERABILITY OF AWARDS. Except as otherwise provided in this
Section, Awards shall not be transferable, and no Award or interest therein may
be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution. All of a
Participant's rights in any Award may be exercised during the life of the
Participant only by the Participant or the Participant's legal representative.
However, the Committee may, at or after the grant of an Award of a Non-Statutory
Option or shares of Restricted Stock, provide that such Award may be transferred
by the recipient to an immediate family member; provided, however, that any such
transfer is without payment of any consideration whatsoever, that no transfer of
an Option shall be valid unless first approved by the Committee, acting in its
sole discretion, and that any Restricted Stock so transferred shall remain
subject to any applicable restriction on transfer and Risk of Forfeiture. For
10
<PAGE>
this purpose, "immediate family member" means an individual's parents, siblings,
spouse and issue, spouses of such issue and any trust for the benefit of, or the
legal representative of, any of the preceding persons, or any partnership
substantially all of the partners of which are one or more of such persons or
the Participant.
7. ISSUANCE OF SHARES. As a condition of any sale or issuance of
Shares upon exercise of any Award, the Committee may require such agreements or
undertakings, if any, as the Committee may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:
(i) a representation and warranty by the Participant to the
Company, at the time any Option is exercised or other Award granted, that he is
acquiring the Shares to be issued to him for investment and not with a view to,
or for sale in connection with, the distribution of any such Shares; and
(ii) (A) an agreement and undertaking to comply with all of
the terms, restrictions and provisions set forth in any then applicable
shareholders' or other agreement relating to the Shares, including, without
limitation, any restrictions on sale or transferability, any rights of first
refusal and any option of the Company to "call" or purchase such Shares under
then applicable agreements; and
(B) any restrictive legend or legends, to be embossed
or imprinted on Share certificates, that are, in the discretion of the
Committee, necessary or appropriate to comply with the provisions of any
securities law or other restriction applicable to the issuance of the Shares.
8. ADMINISTRATION OF THIS PLAN.
(a) This Plan shall be administered by a Committee which shall
consist of not less than two Directors. In the event the Common Stock is listed
or admitted for trading on any United States national securities exchange or as
otherwise required by or advisable under any applicable laws, rules or
regulations, the Plan shall be administered by a Committee consisting of not
less than two Non-Employee Directors. The Committee shall have all of the powers
of the Board with respect to this Plan. Any member of the Committee may be
removed at any time, with or without cause, by resolution of the Board and any
vacancy occurring in the membership of the Committee may be filled by
appointment by the Board. In making such determinations, the Committee may take
into account the nature of the services rendered by the respective employees,
consultants, and directors, their present and potential contributions to the
success of the Company and its subsidiaries, and such other factors as the
Committee in its discretion shall deem relevant.
(b) Subject to the provisions of this Plan, the Committee shall
have the authority, in its sole discretion, to: (i) grant Awards, (ii) determine
the terms, conditions and provisions of each Award granted (which need not be
identical) and, with the consent of the holder thereof, modify or amend each
Award, (iii) determine the Participants to whom, and time or times at which,
Awards shall be granted, (iv) determine the number of Shares to be represented
11
<PAGE>
by each Award, (v) defer (with the consent of the Optionee) or accelerate the
exercise date of any Option or vesting date of any Stock Grant, and (vi) make
all other determinations deemed necessary or advisable for the administration of
this Plan, including repricing, canceling and regranting Awards.
(c) The Committee, from time to time, may adopt rules and
regulations for carrying out the purposes of this Plan. The Committee's
determinations and its interpretation and construction of any provision of this
Plan shall be final, conclusive and binding upon all Participants and any
holders of any Awards granted under this Plan.
(d) Any and all decisions or determinations of the Committee
shall be made either (i) by a majority vote of the members of the Committee at a
meeting of the Committee or (ii) without a meeting by the unanimous written
approval of the members of the Committee.
(e) No member of the Committee, or any Officer or Director of the
Company or its Subsidiaries, shall be personally liable for any act or omission
made in good faith in connection with this Plan.
9. INTERPRETATION.
(a) This Plan shall be administered and interpreted so that all
Incentive Stock Options granted under this Plan will qualify as Incentive Stock
Options under Section 422 of the Code. If any provision of this Plan should be
held invalid for the granting of Incentive Stock Options or illegal for any
reason, such determination shall not affect the remaining provisions hereof, and
this Plan shall be construed and enforced as if such provision had never been
included in this Plan.
(b) This Plan shall be governed by the laws of the State of
Florida.
(c) Headings contained in this Plan are for convenience only and
shall in no manner be construed as part of this Plan or affect the meaning or
interpretation of any part of this Plan.
(d) Any reference to the masculine, feminine, or neuter gender
shall be a reference to such other gender as is appropriate.
(e) Time shall be of the essence with respect to all time periods
specified for the giving of notices to the Company hereunder, as well as all
time periods for the expiration and termination of Options in accordance with
Section 9 hereof (or as otherwise set forth in an option agreement).
(f) It is intended that this Plan shall be administered in
accordance with the disinterested administration requirements of Rule 16b-3
promulgated by the Securities and Exchange Commission ("Rule 16b-3"), or any
successor rule thereto. To the extent any provision of this Plan or action by
the Committee fails to so comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Committee. Notwithstanding
the above, it shall be the responsibility of each Optionee, not of the Company
or the Committee, to comply with the requirements of Section 16 of the
Securities Exchange Act; and neither the Company nor the Committee shall be
liable if this Plan or any transaction under this Plan fails to comply with the
12
<PAGE>
applicable conditions of Rule 16b-3 or any successor rule thereto, or if any
such person incurs any liability under Section 16 of the Securities Exchange
Act.
10. MARKET STANDOFF OR LOCK-UP AGREEMENTS. Each Participant, if so
requested by the Company or any representative of the underwriters in connection
with any registration of the offering of any securities of the Company under the
Securities Act, shall not sell or otherwise transfer any shares of Common Stock
acquired pursuant to this Plan during the period as may be agreed to by the
Company and such underwriters (the "Lock-Up Period") following the effective
date of such registration. The Company may impose stop-transfer instructions
with respect to securities subject to the foregoing restriction until the end of
such Lock-Up Period.
11. AMENDMENT AND DISCONTINUATION OF THIS PLAN. Either the Board or
the Committee may from time to time amend this Plan or any Award without the
consent or approval of the shareholders of the Company; provided, however, that,
except to the extent provided in Section 9, no amendment or suspension of this
Plan or any Award issued hereunder shall substantially impair any Award
previously granted to any Participant without the consent of such Optionee.
12. TERMINATION DATE. This Plan shall terminate 10 years after the
date of adoption by the Board of Directors.
13
