EXHIBIT 4.1
PAWNBROKER.COM, INC.
AMENDED AND RESTATED
1999 STOCK OPTION PLAN
This 1999 Stock Option Plan (the "Plan") provides for the grant of options to
acquire shares of common stock, $0.0001 par value (the "Common Stock"), of
Pawnbroker.com, Inc., a Delaware corporation (the "Company"). Stock options
granted under this Plan that qualify under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code"), are referred to in this Plan as
"Incentive Stock Options." Incentive Stock Options and stock options that do not
qualify under Section 422 of the Code ("Non-Qualified Stock Options") granted
under this Plan are referred to collectively as "Options."
1. PURPOSES.
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The purposes of this Plan are to retain the services of valued key employees and
consultants of the Company and such other persons as the Plan Administrator
shall select in accordance with Section 3 below, to encourage such persons to
acquire a greater proprietary interest in the Company, thereby strengthening
their incentive to achieve the objectives of the shareholders of the Company,
and to serve as an aid and inducement in the hiring of new employees and to
provide an equity incentive to consultants and other persons selected by the
Plan Administrator.
2. ADMINISTRATION.
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This Plan shall be administered initially by the Board of Directors of the
Company (the "Board"), except that the Board may, in its discretion, establish a
committee composed of two (2) or more members of the Board or two (2) or more
other persons to administer the Plan, which committee (the "Committee") may be
an executive, compensation or other committee, including a separate committee
especially created for this purpose. The Committee shall have the powers and
authority vested in the Board hereunder (including the power and authority to
interpret any provision of the Plan or of any Option). The members of any such
Committee shall serve at the pleasure of the Board. A majority of the members of
the Committee shall constitute a quorum, and all actions of the Committee shall
be taken by a majority of the members present. Any action may be taken by a
written instrument signed by all of the members of the Committee and any action
so taken shall be fully effective as if it had been taken at a meeting. The
Board or, if applicable, the Committee is referred to herein as the "Plan
Administrator."
The Plan shall be administered by the Board or by the Committee which, for the
purposes hereof, shall be composed of two (2) or more members of the Board who
are "Non-Employee Directors" (as defined below), and, as applicable, outside
directors. The term "outside director" shall have the meaning assigned to it
under Section 162(m) of the Code (as amended from time to time) and the
regulations (or any successor regulations) promulgated thereunder ("Section
162(m) of the Code"). The term "Non-Employee Director" shall have the meaning
assigned to it under Rule 16b-3 (as amended from time to time) promulgated under
the Securities Exchange Act of 1934, as amended (the "Exchange Act") or any
successor rule or regulatory requirement.
Subject to the provisions of this Plan, and with a view to effecting its
purpose, the Plan Administrator shall have sole authority, in its absolute
discretion, to (i) construe and interpret this Plan; (ii) define the terms used
in the Plan; (iii) prescribe, amend and rescind the rules and regulations
relating to this Plan; (iv) correct any defect, supply any omission or reconcile
any inconsistency in this Plan; (v) grant Options under this Plan; (vi)
determine the individuals to whom Options shall be granted under this Plan and
whether the Option is an Incentive Stock Option or a Non-Qualified Stock Option;
(vii) determine the time or times at which Options shall be granted
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under this Plan; (viii) determine the number of shares of Common Stock subject
to each Option, the exercise price of each Option, the duration of each Option
and the times at which each Option shall become exercisable; (ix) determine all
other terms and conditions of the Options; and (x) make all other determinations
and interpretations necessary and advisable for the administration of the Plan.
All decisions, determinations and interpretations made by the Plan Administrator
shall be binding and conclusive on all participants in the Plan and on their
legal representatives, heirs and beneficiaries.
The Board or, if applicable, the Committee may delegate to one or more executive
officers of the Company the authority to grant Options under this Plan to
employees of the Company who, on the Date of Grant, are not subject to Section
16 of the Exchange Act with respect to the Common Stock ("Non-Insiders"), and
are not "covered employees" as such term is defined for purposes of Section
162(m) of the Code ("Non-Covered Employees"), and in connection therewith the
authority to determine: (i) the number of shares of Common Stock subject to such
Options; (ii) the duration of the Option; (iii) the vesting schedule for
determining the times at which such Option shall become exercisable; and (iv)
all other terms and conditions of such Options. The exercise price for any
Option granted by action of an executive officer or officers pursuant to such
delegation of authority shall not be less than the fair market value per share
of the Common Stock on the Date of Grant. Unless expressly approved in advance
by the Board or the Committee, such delegation of authority shall not include
the authority to accelerate vesting, extend the period for exercise or otherwise
alter the terms of outstanding Options. The term "Plan Administrator" when used
in any provision of this Plan other than Sections 2, 5(f), 5(m), and 11 shall be
deemed to refer to the Board or the Committee, as the case may be, and an
executive officer who has been authorized to grant Options pursuant thereto,
insofar as such provisions may be applied to persons that are Non-Insiders and
Non-Covered Employees and Options granted to such persons.
3. ELIGIBILITY.
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Incentive Stock Options may be granted to any individual who, at the time the
Option is granted, is an employee of the Company or any Related Corporation (as
defined below) ("Employees"). Non-Qualified Stock Options may be granted to
Employees and to such other persons other than directors who are not Employees
as the Plan Administrator shall select. Options may be granted in substitution
for outstanding Options of another corporation in connection with the merger,
consolidation, acquisition of property or stock or other reorganization between
such other corporation and the Company or any subsidiary of the Company. Options
also may be granted in exchange for outstanding Options. Any person to whom an
Option is granted under this Plan is referred to as an "Optionee." Any person
who is the owner of an Option is referred to as a "Holder."
As used in this Plan, the term "Related Corporation" shall mean any corporation
(other than the Company) that is a "Parent Corporation" of the Company or
"Subsidiary Corporation" of the Company, as those terms are defined in Sections
424(e) and 424(f), respectively, of the Code (or any successor provisions) and
the regulations thereunder (as amended from time to time).
4. STOCK.
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The Plan Administrator is authorized to grant Options to acquire up to a total
of eight million (8,000,000) shares of the Company's authorized but unissued, or
reacquired, Common Stock. The number of shares with respect to which Options may
be granted hereunder is subject to adjustment as set forth in Section 5(m)
hereof. In the event that any outstanding Option expires or is terminated for
any reason, the shares of Common Stock allocable to the unexercised portion of
such Option may again be subject to an Option granted to the same Optionee or to
a different person eligible under Section 3 of this Plan; provided however, that
any canceled Options will be
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counted against the maximum number of shares with respect to which Options may
be granted to any particular person as set forth in Section 3 hereof.
5. TERMS AND CONDITIONS OF OPTIONS.
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Each Option granted under this Plan shall be evidenced by a written agreement
approved by the Plan Administrator (the "Agreement"). Agreements may contain
such provisions, not inconsistent with this Plan, as the Plan Administrator in
its discretion may deem advisable. All Options also shall comply with the
following requirements:
(a) Number of Shares and Type of Option.
Each Agreement shall state the number of shares of Common Stock to
which it pertains and whether the Option is intended to be an
Incentive Stock Option or a Non-Qualified Stock Option. In the absence
of action to the contrary by the Plan Administrator in connection with
the grant of an Option, all Options shall be Non-Qualified Stock
Options. The aggregate fair market value (determined at the Date of
Grant, as defined below) of the stock with respect to which Incentive
Stock Options are exercisable for the first time by the Optionee
during any calendar year (granted under this Plan and all other
Incentive Stock Option plans of the Company, a Related Corporation or
a predecessor corporation) shall not exceed $100,000, or such other
limit as may be prescribed by the Code as it may be amended from time
to time. Any portion of an Option which exceeds the annual limit shall
not be void but rather shall be a Non-Qualified Stock Option.
(b) Date of Grant.
Each Agreement shall state the date the Plan Administrator has deemed
to be the effective date of the Option for purposes of this Plan (the
"Date of Grant").
(c) Option Price.
Each Agreement shall state the price per share of Common Stock at
which it is exercisable. The exercise price shall be fixed by the Plan
Administrator at whatever price the Plan Administrator may determine
in the exercise of its sole discretion; provided that the per share
exercise price for an Incentive Stock Option or any Option granted to
a "covered employee" as such term is defined for purposes of Section
162(m) of the Code ("Covered Employee") shall not be less than the
fair market value per share of the Common Stock at the Date of Grant
as determined by the Plan Administrator in good faith; provided
further, that with respect to Incentive Stock Options granted to
greater-than-ten percent (> 10%) shareholders of the Company (as
determined with reference to Section 424(d) of the Code), the exercise
price per share shall not be less than one hundred ten percent (110%)
of the fair market value per share of the Common Stock at the Date of
Grant as determined by the Plan Administrator in good faith; and,
provided further, that Options granted in substitution for outstanding
options of another corporation in connection with the merger,
consolidation, acquisition of property or stock or other
reorganization involving such other corporation and the Company or any
subsidiary of the Company may be granted with an exercise price equal
to the exercise price for the substituted option of the other
corporation, subject to any
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adjustment consistent with the terms of the transaction pursuant to
which the substitution is to occur.
(d) Duration of Options.
At the time of the grant of the Option, the Plan Administrator shall
designate, subject to paragraph 5(g) below, the expiration date of the
Option, which date shall not be later than ten (10) years from the
Date of Grant in the case of Incentive Stock Options; provided, that
the expiration date of any Incentive Stock Option granted to a
greater-than-ten percent ( > 10%) shareholder of the Company (as
determined with reference to Section 424(d) of the Code) shall not be
later than five (5) years from the Date of Grant. In the absence of
action to the contrary by the Plan Administrator in connection with
the grant of a particular Option, and except in the case of Incentive
Stock Options as described above, all Options granted under this
Section 5 shall expire ten (10) years from the Date of Grant.
(e) Vesting Schedule.
No Option shall be exercisable until it has vested. The vesting
schedule for each Option shall be specified by the Plan Administrator
at the time of grant of the Option prior to the provision of services
with respect to which such Option is granted; provided, that if no
vesting schedule is specified at the time of grant, the Option shall
vest according to the following schedule:
Number of Years Percentage of Total
Following Date of Grant Option Vested
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One 20%
Two 40%
Three 60%
Four 80%
Five 100%
The Plan Administrator may specify a vesting schedule for all or any
portion of an Option based on the achievement of performance
objectives established in advance of the commencement by the Optionee
of services related to the achievement of the performance objectives.
Performance objectives shall be expressed in terms of one or more of
the following: return on equity, return on assets, share price, market
share, sales, earnings per share, costs, net earnings, net worth,
inventories, cash and cash equivalents, gross margin or the Company's
performance relative to its internal business plan. Performance
objectives may be in respect of the performance of the Company as a
whole (whether on a consolidated or unconsolidated basis), a Related
Corporation, or a subdivision, operating unit, product or product line
of either of the foregoing. Performance objectives may be absolute or
relative and may be expressed in terms of a progression or a range. An
Option that is exercisable (in full or in part) upon the achievement
of one or more performance objectives may be exercised only following
written notice to the Optionee and the Company by the Plan
Administrator that the performance objective has been achieved.
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(f) Acceleration of Vesting.
The vesting of one or more outstanding Options may be accelerated by
the Plan Administrator at such times and in such amounts as it shall
determine in its sole discretion.
(g) Term of Option.
Vested Options shall terminate, to the extent not previously
exercised, upon the occurrence of the first of the following events:
(i) the expiration of the Option, as designated by the Plan
Administrator in accordance with Section 5(d) above; (ii) the date of
an Optionee's termination of employment or contractual relationship
with the Company or any Related Corporation for cause (as determined
in the sole discretion of the Plan Administrator); (iii) the
expiration of three (3) months from the date of an Optionee's
termination of employment or contractual relationship with the Company
or any Related Corporation for any reason whatsoever other than cause,
death or Disability (as defined below) unless, in the case of a
Non-Qualified Stock Option, the exercise period is extended by the
Plan Administrator until a date not later than the expiration date of
the Option; or (iv) the expiration of one year from termination of an
Optionee's employment or contractual relationship by reason of death
or Disability (as defined below) unless, in the case of a
Non-Qualified Stock Option, the exercise period is extended by the
Plan Administrator until a date not later than the expiration date of
the Option. Upon the death of an Optionee, any vested Options held by
the Optionee shall be exercisable only by the person or persons to
whom such Optionee's rights under such Option shall pass by the
Optionee's will or by the laws of descent and distribution of the
state or county of the Optionee's domicile at the time of death and
only until such Options terminate as provided above. For purposes of
the Plan, unless otherwise defined in the Agreement, "Disability"
shall mean medically determinable physical or mental impairment which
has lasted or can be expected to last for a continuous period of not
less than twelve (12) months or that can be expected to result in
death (within the meaning of Section 22(e)(3) of the Code). The Plan
Administrator shall determine whether an Optionee has incurred a
Disability on the basis of medical evidence acceptable to the Plan
Administrator. Upon making a determination of Disability, the Plan
Administrator shall, for purposes of the Plan, determine the date of
an Optionee's termination of employment or contractual relationship.
Unless accelerated in accordance with Section 5(f) above, unvested
Options shall terminate immediately upon termination of employment of
the Optionee by the Company for any reason whatsoever, including death
or Disability. For purposes of this Plan, transfer of employment
between or among the Company and/or any Related Corporation shall not
be deemed to constitute a termination of employment with the Company
or any Related Corporation. For purposes of this subsection,
employment shall be deemed to continue while the Optionee is on
military leave, sick leave or other bona fide leave of absence (as
determined by the Plan Administrator). The foregoing notwithstanding,
employment shall not be deemed to continue beyond the first ninety
(90) days of such leave, unless the Optionee's re-employment rights
are guaranteed by statute or by contract.
(h) Exercise of Options.
Options shall be exercisable, in full or in part, at any time after
vesting, until termination. If less than all of the shares included in
the vested portion of any Option are purchased, the remainder may be
purchased at any subsequent time prior to the expiration of the Option
term. No portion of any Option for less than One Hundred (100) shares
(as adjusted pursuant to Section 5(m) below) may be exercised;
provided, that if the vested portion of any Option is less than One
Hundred (100) shares, it may be exercised with respect to all shares
for which it is vested. Only whole shares may be issued pursuant to an
Option, and to the extent that an Option covers less than one (1)
share, it is unexercisable.
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Options or portions thereof may be exercised by giving written notice
to the Company, which notice shall specify the number of shares to be
purchased, and be accompanied by payment in the amount of the
aggregate exercise price for the Common Stock so purchased, which
payment shall be in the form specified in Section 5(i) below. The
Company shall not be obligated to issue, transfer or deliver a
certificate of Common Stock to the Holder of any Option, until
provision has been made by the Holder, to the satisfaction of the
Company, for the payment of the aggregate exercise price for all
shares for which the Option shall have been exercised and for
satisfaction of any tax withholding obligations associated with such
exercise. During the lifetime of an Optionee, Options are exercisable
only by the Optionee or in the case of a Non-Qualified Stock Option,
transferee who takes title to such Option in the manner permitted by
subsection 5(k) hereof.
(i) Payment upon Exercise of Option.
Upon the exercise of any Option, the aggregate exercise price shall be
paid to the Company in cash or by certified or cashier's check. In
addition, the Holder may pay for all or any portion of the aggregate
exercise price by complying with one or more of the following
alternatives:
(1) by delivering to the Company shares of Common Stock previously
held by such Holder, or by the Company withholding shares of Common
Stock otherwise deliverable pursuant to exercise of the Option, which
shares of Common Stock received or withheld shall have a fair market
value at the date of exercise (as determined by the Plan
Administrator) equal to the aggregate exercise price to be paid by the
Optionee upon such exercise;
(2) by delivering a properly executed exercise notice together with
irrevocable instructions to a broker promptly to sell or margin a
sufficient portion of the shares and deliver directly to the Company
the amount of sale or margin loan proceeds to pay the exercise price;
or
(3) by complying with any other payment mechanism approved by the Plan
Administrator at the time of exercise. Notwithstanding the foregoing,
without the prior written consent of the Plan Administrator, a Holder
shall not surrender, or attest to the ownership of, shares of Common
Stock in payment of the exercise price if such action would cause the
Company to recognize compensation expense (or additional compensation
expense) with respect to any option for financial reporting purposes.
(j) Rights as a Shareholder.
A Holder shall have no rights as a shareholder with respect to any
shares covered by an Option until such Holder becomes a record holder
of such shares, irrespective of whether such Holder has given notice
of exercise. No rights shall accrue to a Holder and no adjustments
shall be made on account of dividends (ordinary or extraordinary,
whether in cash, securities or other property) or distributions or
other rights declared on, or created in, the Common Stock for which
the record date is prior to the date the Holder becomes a record
holder of the shares of Common Stock covered by the Option,
irrespective of whether such Holder has given notice of exercise.
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(k) Transfer of Option.
Options granted under this Plan and the rights and privileges
conferred by this Plan may not be transferred, assigned, pledged or
hypothecated in any manner (whether by operation of law or otherwise)
other than by will, by applicable laws of descent and distribution or
(except in the case of an Incentive Stock Option) pursuant to a
qualified domestic relations order, and shall not be subject to
execution, attachment or similar process; provided however, that any
Agreement may provide or be amended to provide that a Non-Qualified
Stock Option to which it relates is transferable without payment of
consideration to immediate family members of the Optionee or to trusts
or partnerships or limited liability companies established exclusively
for the benefit of the Optionee and the Optionee's immediate family
members. Upon any attempt to transfer, assign, pledge, hypothecate or
otherwise dispose of any Option or of any right or privilege conferred
by this Plan contrary to the provisions hereof, or upon the sale, levy
or any attachment or similar process upon the rights and privileges
conferred by this Plan, such Option shall thereupon terminate and
become null and void.
(l) Securities Regulation and Tax Withholding.
(1) Shares shall not be issued with respect to an Option unless the
exercise of such Option and the issuance and delivery of such shares
shall comply with all relevant provisions of law, including, without
limitation, Section 162(m) of the Code, any applicable state
securities laws, the Securities Act of 1933, as amended, the Exchange
Act, the rules and regulations thereunder and the requirements of any
stock exchange or automated inter-dealer quotation system of a
registered national securities association upon which such shares may
then be listed, and such issuance shall be further subject to the
approval of counsel for the Company with respect to such compliance,
including the availability of an exemption from registration for the
issuance and sale of such shares. The inability of the Company to
obtain from any regulatory body the authority deemed by the Company to
be necessary for the lawful issuance and sale of any shares under this
Plan, or the unavailability of an exemption from registration for the
issuance and sale of any shares under this Plan, shall relieve the
Company of any liability with respect to the non-issuance or sale of
such shares.
As a condition to the exercise of an Option, the Plan
Administrator may require the Holder to represent and warrant in
writing at the time of such exercise that the shares are being
purchased only for investment and without any then-present intention
to sell or distribute such shares. At the option of the Plan
Administrator, a stop-transfer order against such shares may be placed
on the stock books and records of the Company, and a legend indicating
that the stock may not be pledged, sold or otherwise transferred
unless an opinion of counsel is provided stating that such transfer is
not in violation of any applicable law or regulation, may be stamped
on the certificates representing such shares in order to assure an
exemption from registration. The Plan Administrator also may require
such other documentation as may from time to time be necessary to
comply with federal and state securities laws.
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(2) The Holder shall pay to the Company by certified or cashier's
check, promptly upon exercise of an Option or, if later, the date that
the amount of such obligations becomes determinable, all applicable
federal, state, local and foreign withholding taxes that the Plan
Administrator, in its discretion, determines to result upon exercise
of an Option or from a transfer or other disposition of shares of
Common Stock acquired upon exercise of an Option or otherwise related
to an Option or shares of Common Stock acquired in connection with an
Option. Upon approval of the Plan Administrator, a Holder may satisfy
such obligation by complying with one or more of the following
alternatives selected by the Plan Administrator:
(A) by delivering to the Company shares of Common Stock
previously held by such Holder or by the Company withholding
shares of Common Stock otherwise deliverable pursuant to the
exercise of the Option, which shares of Common Stock received or
withheld shall have a fair market value at the date of exercise
(as determined by the Plan Administrator) equal to any
withholding tax obligations arising as a result of such exercise,
transfer or other disposition;
(B) by executing appropriate loan documents approved by the Plan
Administrator by which the Holder borrows funds from the Company
to pay any withholding taxes due under this Paragraph 2, with
such repayment terms as the Plan Administrator shall select; or
(C) by complying with any other payment mechanism approved by the
Plan Administrator from time to time.
Notwithstanding the foregoing, without the prior written consent of
the Plan Administrator, a Holder shall not surrender, or attest to the
ownership of, shares of Common Stock in payment of the exercise price
if such action would cause the Company to recognize compensation
expense (or additional compensation expense) with respect to any
option for financial reporting purposes.
(3) The issuance, transfer or delivery of certificates of Common Stock
pursuant to the exercise of Options may be delayed, at the discretion
of the Plan Administrator, until the Plan Administrator is satisfied
that the applicable requirements of the federal and state securities
laws and the withholding provisions of the Code have been met and that
the Holder has paid or otherwise satisfied any withholding tax
obligation as described in (2) above.
(m) Stock Dividend or Reorganization.
(1) If (i) the Company shall at any time be involved in a transaction
described in Section 424(a) of the Code (or any successor provision)
or any "corporate transaction" described in the regulations
thereunder; (ii) the Company shall declare a dividend payable in, or
shall subdivide or combine, its Common Stock or (iii) any other event
with substantially the same effect shall occur, the Plan Administrator
shall, subject to applicable law, with respect to each outstanding
Option, proportionately adjust the number of shares of Common Stock
subject to such Option and/or the exercise price per share so as to
preserve the rights of the Holder substantially proportionate to the
rights of the Holder prior to such event, and to the extent that such
action shall include an increase or decrease in the number of shares
of Common Stock subject to outstanding Options, the number of shares
available under Section 4 of this Plan shall automatically be
increased or decreased, as the case may be, proportionately, without
further action on the part of the Plan Administrator, the Company, the
Company's shareholders, or any Holder.
(2) In the event that the presently authorized capital stock of the
Company is changed into the same number of shares with a different par
value, or without par value, the stock resulting from any such change
shall be deemed to be Common Stock within the meaning of the Plan, and
each Option shall apply to the same number of shares of such new stock
as it applied to old shares immediately prior to such change.
(3) If the Company shall at any time declare an extraordinary dividend
with respect to the Common Stock, whether payable in cash or other
property, the Plan Administrator may, subject to applicable law, in
the exercise of its sole discretion and with respect to each
outstanding Option, proportionately adjust the number of shares of
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Common Stock subject to such Option and/or adjust the exercise price
per share so as to preserve the rights of the Holder substantially
proportionate to the rights of the Holder prior to such event, and to
the extent that such action shall include an increase or decrease in
the number of shares of Common Stock subject to outstanding Options,
the number of shares available under Section 4 of this Plan shall
automatically be increased or decreased, as the case may be,
proportionately, without further action on the part of the Plan
Administrator, the Company, the Company's shareholders, or any Holder.
(4) The foregoing adjustments in the shares subject to Options shall
be made by the Plan Administrator, or by any successor administrator
of this Plan, or by the applicable terms of any assumption or
substitution document.
(5) The grant of an Option 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, consolidate or dissolve, to liquidate or to sell or transfer
all or any part of its business or assets.
6. EFFECTIVE DATE; TERM.
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Incentive Stock Options may be granted by the Plan Administrator from time to
time on or after the date on which this Plan is adopted (the "Effective Date")
through the day immediately preceding the tenth anniversary of the Effective
Date. Non-Qualified Stock Options may be granted by the Plan Administrator on or
after the Effective Date and until this Plan is terminated by the Board in its
sole discretion. Termination of this Plan shall not terminate any Option granted
prior to such termination. Any Incentive Stock Options granted by the Plan
Administrator prior to the approval of this Plan by the shareholders of the
Company in accordance with Section 422 of the Code shall be granted subject to
ratification of this Plan by the shareholders of the Company within twelve (12)
months before or after the Effective Date. Any Option granted by the Plan
Administrator to any Covered Employee prior to the approval of this Plan by the
shareholders of the Company in accordance with such Code provision shall be
granted subject to ratification of this Plan by the shareholders of the Company
within twelve (12) months before or after the Effective Date. If such
shareholder ratification is sought and not obtained, all Options granted prior
thereto and thereafter shall be considered Non-Qualified Stock Options and any
Options granted to Covered Employees will not be eligible for the exclusion set
forth in Section 162(m) of the Code with respect to the deductibility by the
Company of certain compensation.
7. NO OBLIGATIONS TO EXERCISE OPTION.
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The grant of an Option shall impose no obligation upon the Optionee to exercise
such Option.
8. NO RIGHT TO OPTIONS OR TO EMPLOYMENT.
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Whether or not any Options are to be granted under this Plan shall be
exclusively within the discretion of the Plan Administrator, and nothing
contained in this Plan shall be construed as giving any person any right to
participate under this Plan. The grant of an Option shall in no way constitute
any form of agreement or understanding binding on the Company or any Related
Company, express or implied, that the Company or any Related Company will employ
or contract with an Optionee for any length of time, nor shall it interfere in
any way with the Company's or, where applicable, a Related Company's right to
terminate Optionee's employment at any time, which right is hereby reserved.
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9. APPLICATION OF FUNDS.
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The proceeds received by the Company from the sale of Common Stock issued upon
the exercise of Options shall be used for general corporate purposes, unless
otherwise directed by the Board.
10. INDEMNIFICATION OF PLAN ADMINISTRATOR.
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In addition to all other rights of indemnification they may have as members of
the Board, members of the Plan Administrator shall be indemnified by the Company
for all reasonable expenses and liabilities of any type or nature, including
attorneys' fees, incurred in connection with any action, suit or proceeding to
which they or any of them are a party by reason of, or in connection with, this
Plan or any Option granted under this Plan, and against all amounts paid by them
in settlement thereof (provided that such settlement is approved by independent
legal counsel selected by the Company), except to the extent that such expenses
relate to matters for which it is adjudged that such Plan Administrator member
is liable for willful misconduct; provided, that within fifteen (15) days after
the institution of any such action, suit or proceeding, the Plan Administrator
member involved therein shall, in writing, notify the Company of such action,
suit or proceeding, so that the Company may have the opportunity to make
appropriate arrangements to prosecute or defend the same.
11. AMENDMENT OF PLAN.
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The Plan Administrator may, at any time, modify, amend or terminate this Plan or
modify or amend Options granted under this Plan, including, without limitation,
such modifications or amendments as are necessary to maintain compliance with
applicable statutes, rules or regulations; provided however, no amendment with
respect to an outstanding Option which has the effect of reducing the benefits
afforded to the Holder thereof shall be made over the objection of such Holder;
further provided, that the events triggering acceleration of vesting of
outstanding Options may be modified, expanded or eliminated without the consent
of Holders. The Plan Administrator may condition the effectiveness of any such
amendment on the receipt of shareholder approval at such time and in such manner
as the Plan Administrator may consider necessary for the Company to comply with
or to avail the Company and/or the Optionees of the benefits of any securities,
tax, market listing or other administrative or regulatory requirement. Without
limiting the generality of the foregoing, the Plan Administrator may modify
grants to persons who are eligible to receive Options under this Plan who are
foreign nationals or employed outside the United States to recognize differences
in local law, tax policy or custom.
Effective Date: May 3, 2000 (as amended).
PAWNBROKER.COM, INC.
/s/ William Galine
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Secretary
10
