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EXHIBIT 10.10
CHILES OFFSHORE INC.
2000 STOCK OPTION PLAN
I. PURPOSE. The Chiles Offshore Inc. 2000 Stock Option Plan (the "Plan") is
intended to provide incentives which will attract, retain and motivate
select officers, key employees and other persons providing services to
Chiles Offshore Inc. (the "Company") and its subsidiaries and affiliates,
by providing them opportunities to acquire shares of the Company's common
stock, par value $.01 per share ("Common Stock"), or to receive monetary
payments based on the value of such shares pursuant to the Benefits (as
defined below) described herein. Furthermore, the Plan is intended to
assist in aligning the interests of the Company's officers, key employees
and other persons providing services to those of the Company's
stockholders.
II. ADMINISTRATION.
A. The Plan will be administered by a committee (the "Committee")
appointed by the Board of Directors of the Company from among its
members (which may be the Compensation Committee) and shall be
comprised, unless otherwise determined by the Board of Directors, of
not less than two members who shall be (i) "Non-Employee Directors"
within the meaning of Rule 16b-3(b)(3) (or any successor rule)
promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") and (ii) "outside directors" within the Treasury
Regulation Section 1.162-27(e)(3) under Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"). The Committee is
authorized, subject to the provisions of the Plan, to establish such
rules and regulations as it deems necessary for the proper
administration of the Plan and to make such determinations and
interpretations and to take such action in connection with the Plan
and any Benefits granted hereunder as it deems necessary or advisable.
In particular, the Committee may establish or waive the terms and
conditions applicable to any Benefit awarded under the Plan and may
waive any or all of such terms and conditions. All determinations and
interpretations made by the Committee shall be binding and conclusive
on all participants and their legal representatives. No member of the
Board of the Directors, no member of the Committee and no employee of
the Company shall be liable for any act or failure to act hereunder,
except in circumstances involving his or her bad faith, gross
negligence or willful misconduct, or for any act or failure to act
hereunder by any other member or employee or by any agent to whom
duties in connection with the administration of this Plan have been
delegated. The Company shall indemnify members of the Committee and
any agent of the Committee who is an employee of the Company, a
subsidiary or an affiliate against any and all liabilities or expenses
to which they may be subjected by reason of any act or failure to act
with respect to their duties
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on behalf of the Plan, except in circumstances involving such person's
bad faith, gross negligence or willful misconduct.
B. The Committee may delegate to one or more of its members, or to one or
more agents, such administrative duties as it may deem advisable, and
the Committee, or any person to whom it has delegated duties as
aforesaid, may employ one or more persons to render advice with
respect to any responsibility the Committee or such person may have
under the Plan. The Committee may employ such legal or other counsel,
consultants and agents as it may deem desirable for the administration
of the Plan and may rely upon any opinion or computation received from
any such counsel, consultant or agent. Expenses incurred by the
Committee in the engagement of such counsel, consultant or agent shall
be paid by the Company, or the subsidiary or affiliate whose employees
have benefited from the Plan, as determined by the Committee.
III. PARTICIPANTS. Participants will consist of such officers, key employees and
other persons providing services to the Company and its subsidiaries and
affiliates as the Committee in its sole discretion determines to be
significantly responsible for the success and future growth and
profitability of the Company and whom the Committee may designate from time
to time to receive Benefits under the Plan. Designation of a participant in
any year shall not require the Committee to designate such person to
receive a Benefit in any other year or, once designated, to receive the
same type or amount of Benefit as granted to the participant in any other
year. The Committee shall consider such factors as it deems pertinent in
selecting participants and in determining the type and amount of their
respective Benefits.
IV. TYPE OF BENEFITS. Benefits under the Plan may be granted in any one or a
combination of (a) Stock Options, (b) Stock Appreciation Rights, (c) Stock
Awards, (d) Performance Awards and (e) Stock Units (each as described
below, and collectively, the "Benefits"). Benefits shall be evidenced by
agreements (which need not be identical) in such forms as the Committee may
from time to time approve; provided, however, that in the event of any
conflict between the provisions of the Plan and any such agreements, the
provisions of the Plan shall prevail. The maximum number of shares of
Common Stock with respect to which Benefits may be granted or measured to
any individual participant under the Plan during any two calendar years
shall not exceed 200,000, subject to any adjustments made in accordance
with Section 12.
V. COMMON STOCK AVAILABLE UNDER THE PLAN. The aggregate number of shares of
Common Stock that may be subject to Benefits, including Stock Options,
granted under this Plan shall be the lesser of 1.1 million shares of
Common Stock or five percent (5%) of the outstanding Common Stock on a
fully diluted basis as of the date of the completion of an initial public
offering of Common Stock, subject to any adjustments made in accordance
with Section 12
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hereof. Shares of Common Stock subject to the Plan may be authorized and
unissued shares or treasury shares. Any shares of Common Stock subject to a
Stock Option or Stock Appreciation Right which for any reason is canceled
or terminated without having been exercised, any shares subject to Stock
Awards, Performance Awards or Stock Units which are forfeited, any shares
subject to Benefits settled in cash or any shares delivered to the Company
as part or full payment for the exercise of a Benefit shall again be
available for Benefits under the Plan. The preceding sentence shall apply
only for purposes of determining the aggregate number of shares of Common
Stock subject to Benefits but shall not apply for purposes of determining
the maximum number of shares of Common Stock with respect to which Benefits
(including the maximum number of shares of Common Stock subject to Stock
Options and Stock Appreciation Rights) that may be grated to any individual
participant under the Plan.
VI. STOCK OPTIONS. Stock Options will consist of awards from the Company that
will enable the holder to purchase a specific number of shares of Common
Stock, at set terms and at a fixed purchase price. Stock Options may be
"incentive stock options" ("Incentive Stock Options"), within the meaning
of Section 422 of the Code, or Stock Options which do not constitute
Incentive Stock Options ("Nonqualified Stock Options"). The Committee will
have the authority to grant to any participant one or more Incentive Stock
Options, Nonqualified Stock Options, or both types of Stock Options (in
each case with or without Stock Appreciation Rights); provided that Stock
Options granted to any person who is not an employee of the Company or any
parent or subsidiary corporation thereof (as defined in Section 424 of the
Code) shall not be traded as Incentive Stock Options. Each Stock Option
shall be subject to such terms and conditions consistent with the Plan as
the Committee may impose from time to time, subject to the following
limitations:
A. EXERCISE PRICE. Each Stock Option granted hereunder shall have such
per-share exercise price as the Committee may determine at the date of
grant; provided, however, subject to subsection (d) below that the
per-share exercise price shall not be less than 90% of the Fair Market
Value (as defined below) of the Common Stock on the date the Stock
Option is granted.
B. PAYMENT OF EXERCISE PRICE. The option exercise price may be paid in
cash or, in the discretion of the Committee, by the delivery of shares
of Common Stock then owned by the participant, or by a combination of
these methods. In the discretion of the Committee, payment may also be
made by delivering a properly executed exercise notice to the Company
together with a copy of irrevocable instructions to a broker to
deliver promptly to the Company the amount of sale or loan proceeds to
pay the exercise price. To facilitate the foregoing, the Company may
enter into agreements for coordinated procedures with one or more
brokerage firms. The Committee may prescribe any other method
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of paying the exercise price that it determines to be consistent with
applicable law and the purpose of the Plan, including, without
limitation, in lieu of the exercise of a Stock Option by delivery of
shares of Common Stock of the Company then owned by a participant,
providing the Company with a notarized statement attesting to the
number of shares owned, where upon verification by the Company, the
Company would issue to the participant only the number of incremental
shares to which the participant is entitled upon exercise of the Stock
Option. The Committee may, at the time of grant, provide for the grant
of a subsequent Restoration Stock Option if the exercise price is paid
for by delivering previously owned shares of Common Stock of the
Company. Restoration Stock Options (i) may be granted in respect of no
more than the number of shares of Common Stock tendered in exercising
the predecessor Stock Option, (ii) shall have an exercise price equal
to the Fair Market Value on the date the Restoration Stock Option is
granted, and (iii) may have an exercise period that does not extend
beyond the remaining term of the predecessor Stock Option. In
determining which methods a participant may utilize to pay the
exercise price, the Committee may consider such factors as it
determines are appropriate.
C. EXERCISE PERIOD. Stock Options granted under the Plan shall be
exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Committee; provided, however,
that no Stock Option shall be exercisable later than ten years after
the date it is granted except in the event of a participant's death,
in which case, the exercise period of such participant's Stock Options
may be extended beyond such period but no later than one year after
the participant's death. All Stock Options shall terminate at such
earlier times and upon such conditions or circumstances as the
Committee shall in its discretion set forth in such option agreement
at the date of grant; PROVIDED, HOWEVER, the Committee may, in its
sole, discretion, later wave any such condition.
D. LIMITATIONS ON INCENTIVE STOCK OPTIONS. Incentive Stock Options may be
granted only to participants who are employees of the Company or one
of its subsidiaries (within the meaning of Section 424(f) of the Code)
at the date of grant. The per share exercise price of an Incentive
Stock Option shall not be less than the Fair Market Value (determined
as of the date of grant of such option) of a share of Common Stock .
The aggregate Fair Market Value (determined as of the time the option
is granted) of the Common Stock with respect to which Incentive Stock
Options are exercisable for the first time by a participant during any
calendar year (under all option plans of the Company and of any parent
corporation or subsidiary corporation (as defined in Sections 424(e)
and (f) of the Code, respectively)) shall not exceed $100,000. For
purposes of the preceding sentence, Incentive Stock Options will be
taken into account
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in the order in which they are granted. Incentive Stock Options may
not be granted to any participant who, at the time of grant, owns
stock possessing (after the application of the attribution rules of
Section 424(d) of the Code) more than 10% of the total combined voting
power of all classes of stock of the Company or any parent or
subsidiary corporation of the Company, unless the option price is
fixed at not less than 110% of the Fair Market Value of the Common
Stock on the date of grant and the exercise of such option is
prohibited by its terms after the expiration of five years from the
date of grant of such option. Notwithstanding anything to the contrary
contained herein, no Incentive Stock Option may be exercised later
than ten years after the date it is granted.
E. POST-EMPLOYMENT EXERCISES. The exercise of any Stock Option after
termination of employment shall be in accordance with the terms and
subject to the conditions established by the Committee pursuant to
Section 6(c) hereof and, in any case, shall be further subject to
satisfaction of the conditions precedent that the Participant neither
(i) competes with, or takes other employment with or renders services
to a competitor of, the Company, its subsidiaries or affiliates
without the written consent of the Company, nor (ii) conducts himself
or herself in a manner adversely affecting the Corporation; provided,
however, that the Committee, in its sole discretion, may wave any
conditions imposed in the grant letter or as set forth in (i) and (ii)
above relating to the exercise of options after the date of
termination of employment during the terms of the option.
VII. STOCK APPRECIATION RIGHTS.
A. The Committee may, in its discretion, grant Stock Appreciation Rights
to the holders of any Stock Options granted hereunder. In addition,
Stock Appreciation Rights may be granted independently of, and without
relation to, Stock Options. A Stock Appreciation Right means a right
to receive a payment, in cash, Common Stock or a combination thereof,
in an amount equal to the excess of (x) the Fair Market Value, or
other specified valuation, of a specified number of shares of Common
Stock on the date the right is exercised over (y) the Fair Market
Value, or other specified valuation (which shall be no less than the
Fair Market Value), of such shares of Common Stock on the date the
right is granted, all as determined by the Committee; provided,
however, that if a Stock Appreciation Right is granted retroactively
in tandem with or in substitution for a Stock Option, the designated
Fair Market Value in the award agreement may be the Fair Market Value
on the date such Stock Option was granted. Each Stock Appreciation
Right shall be subject to such terms and conditions as the Committee
shall impose from time to time.
B. Stock Appreciation Rights granted under the Plan shall be exercisable
at such time or times and subject to such terms and conditions as
shall be
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determined by the Committee; provided, however, that no Stock
Appreciation Rights shall be exercisable later than ten years after
the date it is granted except in the event of a participant's death,
in which case, the exercise period of such participant's Stock
Appreciation Rights may be extended beyond such period but no later
than one year after the participant's death. All Stock Appreciation
Rights shall terminate at such earlier times and upon such conditions
or circumstances as the Committee shall in its discretion set forth in
such option at the date of grant.
C. The exercise of any Stock Appreciation Right after termination of
employment shall be subject to satisfaction of the conditions
precedent that the Participant neither (i) competes with, or takes
other employment with or renders services to a competitor of, the
Company, its subsidiaries or affiliates without the written consent of
the Company, nor (ii) conducts himself or herself in a manner
adversely affecting the Corporation; provided, however, that the
Committee, in its sole discretion, may wave any conditions imposed in
the grant letter or as set forth in (i) and (ii) above relating to the
exercise of options after the date of termination of employment during
the terms of the option.
VIII. STOCK AWARDS. The Committee may, in its discretion, grant Stock Awards
(which may include mandatory payment of bonus incentive compensation in
stock) consisting of Common Stock issued or transferred to participants
with or without other payments therefor. Stock Awards may be subject to
such terms and conditions as the Committee determines appropriate,
including, without limitation, restrictions on the sale or other
disposition of such shares, the right of the Company to reacquire such
shares for no consideration upon termination of the participant's
employment within specified periods, and conditions requiring that the
shares be earned in whole or in part upon the achievement of performance
goals established by the Committee over a designated period of time. The
Committee may require the participant to deliver a duly signed stock power,
endorsed in blank, relating to the Common Stock covered by such an Award.
The Committee may also require that the stock certificates evidencing such
shares be held in custody or bear restrictive legends until the
restrictions thereon shall have lapsed. The Stock Award shall specify
whether the participant shall have, with respect to the shares of Common
Stock subject to a Stock Award, all of the rights of a holder of shares of
Common Stock of the Company, including the right to receive dividends and
to vote the shares.
IX. PERFORMANCE AWARDS.
A. Performance Awards may be granted to participants at any time and from
time to time, as shall be determined by the Committee. The Committee
shall have complete discretion in determining the number, amount and
timing of awards granted to each participant. Such Performance Awards
may be in the form of shares of Common Stock or Stock Units.
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Performance Awards may be awarded as short-term or long-term
incentives. The Committee shall set performance targets at its
discretion which, depending on the extent to which they are met, will
determine the number and/or value of Performance Awards that will be
paid out to the participants, and may attach to such Performance
Awards one or more restrictions. Performance targets may be based
upon, without limitation, Company-wide, divisional and/or individual
performance.
B. The Committee shall have the authority at any time to make adjustments
to performance targets for any outstanding Performance Awards which
the Committee deems necessary or desirable unless at the time of
establishment of such targets the Committee shall have precluded its
authority to make such adjustments.
C. Payment of earned Performance Awards shall be made in accordance with
terms and conditions prescribed or authorized by the Committee. The
participant may elect to defer, or the Committee may require or permit
the deferral of, the receipt of Performance Awards upon such terms as
the Committee deems appropriate.
X. STOCK UNITS.
A. The Committee may, in its discretion, grant Stock Units to
participants hereunder. The Committee shall determine the criteria for
the vesting of Stock Units. A Stock Unit granted by the Committee
shall provide payment in shares of Common Stock at such time as the
award agreement shall specify. Shares of Common Stock issued pursuant
to this Section 10 may be issued with or without other payments
therefor as may be required by applicable law or such other
consideration as may be determined by the Committee. The Committee
shall determine whether a participant granted a Stock Unit shall be
entitled to a Dividend Equivalent Right (as defined below).
B. Upon vesting of a Stock Unit, unless the Committee has determined to
defer payment with respect to such unit or a participant has elected
to defer payment under subsection (c) below, shares of Common Stock
representing the Stock Units shall be distributed to the participant
unless the Committee provides for the payment of the Stock Units in
cash or partly in cash and partly in shares of Common Stock equal to
the value of the shares of Common Stock which would otherwise be
distributed to the participant.
C. Prior to the year with respect to which a Stock Unit may vest, the
participant may elect not to receive a distribution upon the vesting
of such Stock Unit and for the Company to continue to maintain the
Stock Unit on
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its books of account. In such event, the value of a Stock Unit shall
be payable in shares of Common Stock pursuant to the agreement of
deferral.
D. A "Stock Unit" means a notional account representing one share of
Common Stock. A "Dividend Equivalent Right" means the right to receive
the amount of any dividend paid on the share of Common Stock
underlying a Stock Unit, which shall be payable in cash or in the form
of additional Stock Units.
XI. FOREIGN OPTIONS AND RIGHTS.
A. The Committee may grant Benefits to individual participants who are
subject to the tax laws of nations other than the United States, which
Benefits may have terms and conditions as determined by the Committee
as necessary to comply with applicable foreign laws. The Committee may
take any action which it deems advisable to obtain approval of such
Benefits by the appropriate foreign governmental entity; PROVIDED,
HOWEVER, that no such Benefits may be granted pursuant to this Section
11 and no action may be taken which would result in a violation of the
Exchange Act, the Code or any other applicable law.
XII. ADJUSTMENT PROVISIONS; CHANGE IN CONTROL.
A. If there shall be any change in the Common Stock of the Company, or
the capitalization of the Company through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split, reverse
stock split, split up, spinoff, combination of shares, exchange of
shares, dividend in kind or other like change in capital structure or
distribution (other than normal cash dividends) to stockholders of the
Company, an adjustment shall be made to each outstanding Stock Option
and Stock Appreciation Right such that each such Stock Option and
Stock Appreciation Right shall thereafter be exercisable for such
securities, cash and/or other property as would have been received in
respect of the Common Stock subject to such Stock Option or Stock
Appreciation Right had such Stock Option or Stock Appreciation Right
been exercised in full immediately prior to such change or
distribution, and such an adjustment shall be made successively each
time any such change shall occur. In addition, in the event of any
such change or distribution, in order to prevent dilution or
enlargement of participants' rights under the Plan, the Committee will
have authority to adjust, in an equitable manner, the number and kind
of shares that may be issued under the Plan, the number and kind of
shares subject to outstanding Benefits, the exercise price applicable
to outstanding Benefits, and the Fair Market Value of the Common Stock
and other value determinations applicable to outstanding Benefits.
Appropriate adjustments may also be made by the Committee in the terms
of any Benefits under the Plan to reflect such changes or
distributions and
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to modify any other terms of outstanding Benefits on an equitable
basis, including modifications of performance targets and changes in
the length of performance periods. In addition, the Committee is
authorized to make adjustments to the terms and conditions of, and the
criteria included in, Benefits in recognition of unusual or
nonrecurring events affecting the Company or the financial statements
of the Company, or in response to changes in applicable laws,
regulations, or accounting principles. Notwithstanding the foregoing,
(i) each such adjustment with respect to an Incentive Stock Option
shall comply with the rules of Section 424(a) of the Code, and (ii) in
no event shall any adjustment be made which would render any Incentive
Stock Option granted hereunder other than an incentive stock option
for purposes of Section 422 of the Code.
B. Notwithstanding any other provision of this Plan, if there is a Change
in Control of the Company, all then outstanding Stock Options and
Stock Appreciation Rights shall immediately become exercisable. For
purposes of this Section 12(b), a "Change in Control" of the Company
shall be deemed to have occurred upon any of the following events:
1. A change in control of the Company that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Exchange Act; or
2. During any period of two (2) consecutive years, the individuals
who at the beginning of such period constitute the Company's
Board of Directors or any individuals who would be "Continuing
Directors" (as hereinafter defined) cease for any reason to
constitute at least a majority thereof; or
3. The Company's Common Stock shall cease to be publicly traded; or
4. The Company's Board of Directors shall approve a sale of all or
substantially all of the assets of the Company, and such
transaction shall have been consummated; or
5. The Company's Board of Directors shall approve any merger,
consolidation, or like business combination or reorganization of
the Company, the consummation of which would result in the
occurrence of any event described in Section 12(b)(ii) or (iii)
above, and such transaction shall have been consummated.
Notwithstanding the foregoing, (A) any spin-off of a division or subsidiary
of the Company to its stockholders and (B) any event listed in (i) through (v)
above that the Board of Directors determines not to be a Change in Control of
the Company, shall not constitute a Change in Control of the Company.
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For purposes of this Section 12(b), "Continuing Directors" shall mean (x)
the directors of the Company in office on the Effective Date (as defined below)
and (y) any successor to any such director and any additional director who after
the Effective Date was nominated or selected by a majority of the Continuing
Directors in office at the time of his or her nomination or selection.
The Committee, in its discretion, may determine that, upon the occurrence
of a Change in Control of the Company, each Stock Option and Stock Appreciation
Right outstanding hereunder shall terminate within a specified number of days
after notice to the holder, and such holder shall receive, with respect to each
share of Common Stock subject to such Stock Option or Stock Appreciation Right,
an amount equal to the excess of the Fair Market Value of such shares of Common
Stock immediately prior to the occurrence of such Change in Control over the
exercise price per share of such Stock Option or Stock Appreciation Right; such
amount to be payable in cash, in one or more kinds of property (including the
property, if any, payable in the transaction) or in a combination thereof, as
the Committee, in its discretion, shall determine. The provisions contained in
the preceding sentence shall be inapplicable to a Stock Option or Stock
Appreciation Right granted within six (6) months before the occurrence of a
Change in Control if the holder of such Stock Option or Stock Appreciation Right
is subject to the reporting requirements of Section 16(a) of the Exchange Act
and no exception from liability under Section 16(b) of the Exchange Act is
otherwise available to such holder.
XIII. NONTRANSFERABILITY. Each Benefit granted under the Plan to a participant
shall not be transferable otherwise than by will or the laws of descent and
distribution, and shall be exercisable, during the participant's lifetime,
only by the participant. In the event of the death of a participant, each
Stock Option or Stock Appreciation Right theretofore granted to him or her
shall be exercisable during such period after his or her death as the
Committee shall in its discretion set forth in such option or right at the
date of grant and then only by the executor or administrator of the estate
of the deceased participant or the person or persons to whom the deceased
participant's rights under the Stock Option or Stock Appreciation Right
shall pass by will or the laws of descent and distribution.
XIV. OTHER PROVISIONS. The award of any Benefit under the Plan may also be
subject to such other provisions (whether or not applicable to the Benefit
awarded to any other participant) as the Committee determines appropriate,
including, without limitation, for the installment purchase of Common Stock
under Stock Options, for the installment exercise of Stock Appreciation
Rights, to assist the participant in financing the acquisition of Common
Stock, for the forfeiture of, or restrictions on resale or other
disposition of, Common Stock acquired under any form of Benefit, for the
acceleration of exercisability or vesting of Benefits in the event of a
change in control of the Company, for the payment of the value of Benefits
to participants in the event of a change in control of the Company, or to
comply with federal and state securities laws, or understandings or
conditions as to the participant's employment in addition to those
specifically provided for under the Plan.
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XV. FAIR MARKET VALUE. For purposes of this Plan and any Benefits awarded
hereunder, Fair Market Value shall be the closing price of the Common Stock
on the date of calculation (or on the last preceding trading date if Common
Stock was not traded on such date) if the Common Stock is readily tradeable
on a national securities exchange or other market system, and if the Common
Stock is not readily tradeable, Fair Market Value shall mean the amount
determined in good faith by the Committee as the fair market value of the
Common Stock.
XVI. WITHHOLDING. All payments or distributions of Benefits made pursuant to the
Plan shall be net of any amounts required to be withheld pursuant to
applicable federal, state and local tax withholding requirements. If the
Company proposes or is required to distribute Common Stock pursuant to the
Plan, it may require the recipient to remit to it or to the corporation
that employs such recipient an amount sufficient to satisfy such tax
withholding requirements prior to the delivery of any certificates for such
Common Stock. In lieu thereof, the Company or the employing corporation
shall have the right to withhold the amount of such taxes from any other
sums due or to become due from such corporation to the recipient as the
Committee shall prescribe. The Committee may, in its discretion and subject
to such rules as it may adopt (including any as may be required to satisfy
applicable tax and/or non-tax regulatory requirements), permit an optionee
or award or right holder to pay all or a portion of the federal, state and
local withholding taxes arising in connection with any Benefit consisting
of shares of Common Stock by electing to have the Company withhold shares
of Common Stock having a Fair Market Value equal to the amount of tax to be
withheld, such tax calculated at rates required by statute or regulation.
XVII. TENURE. A participant's right, if any, to continue to serve the Company or
any of its subsidiaries or affiliates as an officer, employee, or
otherwise, shall not be enlarged or otherwise affected by his or her
designation as a participant under the Plan.
XVIII. UNFUNDED PLAN. Participants shall have no right, title, or interest
whatsoever in or to any investments which the Company may make to aid it in
meeting its obligations under the Plan. Nothing contained in the Plan, and
no action taken pursuant to its provisions, shall create or be construed to
create a trust of any kind, or a fiduciary relationship between the Company
and any participant, beneficiary, legal representative or any other person.
To the extent that any person acquires a right to receive payments from the
Company under the Plan, such right shall be no greater than the right of an
unsecured general creditor of the Company. All payments to be made
hereunder shall be paid from the general funds of the Company and no
special or separate fund shall be established and no segregation of assets
shall be made to assure payment of such amounts except as expressly set
forth in the Plan. The Plan is not intended to be subject to the Employee
Retirement Income Security Act of 1974, as amended.
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XIX. NO FRACTIONAL SHARES. No fractional shares of Common Stock shall be issued
or delivered pursuant to the Plan or any Benefit. The Committee shall
determine whether cash, or Benefits, or other property shall be issued or
paid in lieu of fractional shares or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.
XX. DURATION, AMENDMENT AND TERMINATION. No Benefit shall be granted more
than ten years after the Effective Date; PROVIDED, HOWEVER, that the
terms and conditions applicable to any Benefit granted prior to such
date may thereafter be amended or modified by mutual agreement between
the Company and the participant or such other persons as may then have
an interest therein. Also, by mutual agreement between the Company and a
participant hereunder, under this Plan or under any other present or
future plan of the Company, Benefits may be granted to such participant
in substitution and exchange for, and in cancellation of, any Benefits
previously granted such participant under this Plan, or any other
present or future plan of the Company. The Board of Directors may amend
the Plan from time to time or suspend or terminate the Plan at any time.
However, no action authorized by this Section 20 shall reduce the amount
of any existing Benefit or change the terms and conditions thereof
without the participant's consent. No amendment of the Plan shall,
without approval of the stockholders of the Company, (i) materially
increase the total number of shares which may be issued under the Plan;
(ii) materially increase the amount or type of Benefits that may be
granted under the Plan; or (iii) materially modify the requirements as
to eligibility for Benefits under the Plan.
XXI. GOVERNING LAW. This Plan, Benefits granted hereunder and actions taken in
connection herewith shall be governed and construed in accordance with the
laws of the State of New York (regardless of the law that might otherwise
govern under applicable New York principles of conflict of laws).
XXII. EFFECTIVE DATE.
A. The Plan was adopted by the Board of Directors and approved by the
stockholders of the Company as of June 22, 2000, but shall be effective
immediately prior to the date of completion of an initial public offering
of Common Stock (the "Effective Date").
B. This Plan shall terminate on June 21, 2010 (unless sooner terminated by the
Board of Directors).
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