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EXHIBIT 99.1
GLOWBUG.COM, INC.
2000 STOCK OPTION/STOCK ISSUANCE PLAN
ARTICLE 1. GENERAL PROVISIONS.
1.1 PURPOSE OF THE PLAN. This 2000 Stock Option/Stock Issuance Plan is
intended to promote the interests of Glowbug.com, Inc., a Delaware corporation,
by providing eligible persons in the Corporation's employ or service with the
opportunity to acquire a proprietary interest, or otherwise increase their
proprietary interest, in the Corporation as an incentive for them to continue in
such employ or service.
Capitalized terms shall have the meanings assigned to such terms in the
attached Appendix.
1.2 STRUCTURE OF THE PLAN.
(a) The Plan shall be divided into two separate equity programs:
(i) the Option Grant Program under which eligible persons may, at
the discretion of the Plan Administrator, be granted options to purchase
shares of Common Stock, and
(ii) the Stock Issuance Program under which eligible persons may, at
the discretion of the Plan Administrator, be issued shares of Common Stock
directly, either through the immediate purchase of such shares or as a
bonus for services rendered the Corporation (or any Parent or Subsidiary).
(b) The provisions of Articles 1 and 4 shall apply to both equity programs
under the Plan and shall accordingly govern the interests of all persons under
the Plan.
1.3 ADMINISTRATION OF THE PLAN.
(a) The Plan shall be administered by the Board. However, any or all
administrative functions otherwise exercisable by the Board may be delegated to
the Committee. Members of the Committee shall serve for such period of time as
the Board may determine and shall be subject to removal by the Board at any
time. The Board may also at any time terminate the functions of the Committee
and reassume all powers and authority previously delegated to the Committee.
(b) The Plan Administrator shall have full power and authority (subject to
the provisions of the Plan) to establish such rules and regulations as it may
deem appropriate for proper administration of the Plan and to make such
determinations under, and issue such interpretations of, the Plan and any
outstanding options or stock issuances thereunder as it may deem necessary or
advisable. Decisions of the Plan Administrator shall be final and binding on all
parties who have an interest in the Plan or any option or stock issuance
thereunder.
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1.4 ELIGIBILITY.
(a) The persons eligible to participate in the Plan are as follows:
(i) Employees,
(ii) non-employee members of the Board or the non-employee members
of the board of directors of any Parent or Subsidiary, and
(iii) consultants and other independent advisors who provide
services to the Corporation (or any Parent or Subsidiary).
(b) The Plan Administrator shall have full authority to determine, (i)
with respect to the grants made under the Option Grant Program, which eligible
persons are to receive the option grants, the time or times when those grants
are to be made, the number of shares to be covered by each such grant, the
status of the granted option as either an Incentive Option or a Non-Statutory
Option, the time or times when each option is to become exercisable, the vesting
schedule (if any) applicable to the option shares and the maximum term for which
the option is to remain outstanding and (ii) with respect to stock issuances
made under the Stock Issuance Program, which eligible persons are to receive
stock issuances, the time or times when those issuances are to be made, the
number of shares to be issued to each Participant, the vesting schedule (if any)
applicable to the issued shares and the consideration to be paid by the
Participant for such shares.
(c) The Plan Administrator shall have the absolute discretion either to
grant options in accordance with the Option Grant Program or to effect stock
issuances in accordance with the Stock Issuance Program.
1.5 STOCK SUBJECT TO THE PLAN.
(a) The stock issuable under the Plan shall be shares of authorized but
unissued or reacquired Common Stock. The maximum number of shares of Common
Stock that may be issued over the term of the Plan shall not exceed 5,000,000
shares.
(b) Shares of Common Stock subject to outstanding options shall be
available for subsequent issuance under the Plan to the extent (i) the options
expire or terminate for any reason prior to exercise in full or (ii) the options
are canceled in accordance with the cancellation-regrant provisions of Article
2. Unvested shares issued under the Plan and subsequently repurchased by the
Corporation, at the option exercise or direct issue price paid per share,
pursuant to the Corporation's repurchase rights under the Plan shall be added
back to the number of shares of Common Stock reserved for issuance under the
Plan and shall accordingly be available for reissuance through one or more
subsequent option grants or direct stock issuances under the Plan.
(c) Should any change be made to the Common Stock by reason of any stock
split, stock dividend, recapitalization, combination of shares, exchange of
shares or other change affecting the outstanding Common Stock as a class without
the Corporation's receipt of consideration, appropriate adjustments shall be
made to (i) the maximum number and/or class of securities issuable under the
Plan and (ii) the number and/or class of securities and the exercise price per
share in effect under each outstanding option to prevent the dilution or
enlargement of benefits thereunder. The adjustments determined by the Plan
Administrator shall be final, binding and conclusive. In no event shall any such
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adjustments be made in connection with the conversion of one or more outstanding
shares of the Corporation's preferred stock into shares of Common Stock.
ARTICLE 2. OPTION GRANT PROGRAM.
2.1 OPTION TERMS. Each option shall be evidenced by one or more documents
in the form approved by the Plan Administrator; PROVIDED, HOWEVER, that each
such document shall comply with the terms specified below. Each document
evidencing an Incentive Option shall, in addition, be subject to the provisions
of the Plan applicable to such options.
(a) EXERCISE PRICE.
(i) The exercise price per share shall be fixed by the Plan
Administrator and may be less than, equal to or greater than the Fair
Market Value on the option grant date.
(ii) The exercise price shall become immediately due upon exercise
of the option and shall, subject to the provisions of Section 4.1 and the
documents evidencing the option, be payable in cash or check made payable
to the Corporation. Should the Common Stock be registered under Section 12
of the 1934 Act at the time the option is exercised, then the exercise
price may also be paid as follows:
a) in shares of Common Stock held for the requisite period
necessary to avoid a charge to the Corporation's
earnings for financial reporting purposes and valued at
the Fair Market Value on the Exercise Date, or
b) to the extent the option is exercised for vested shares,
through a special sale and remittance procedure pursuant
to which the Optionee shall concurrently provide
irrevocable instructions (a) to a Corporation-designated
brokerage firm to effect the immediate sale of the
purchased shares and remit to the Corporation, out of
the sale proceeds available on the settlement date,
sufficient funds to cover the aggregate exercise price
payable for the purchased shares plus all applicable
Federal, state and local income and employment taxes
required to be withheld by the Corporation by reason of
such exercise and (b) to the Corporation to deliver the
certificates for the purchased shares directly to such
brokerage firm to complete the sale.
Except to the extent such sale and remittance procedure is utilized, payment
of the exercise price for the purchased shares must be made on the Exercise
Date.
(b) EXERCISE AND TERM OF OPTIONS. Each option shall be exercisable at such
time or times, during such period and for such number of shares as shall be
determined by the Plan Administrator and set forth in the documents evidencing
the option grant. However, no option shall have a term in excess of ten years
measured from the option grant date.
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(c) EFFECT OF TERMINATION OF SERVICE.
(i) The following provisions shall govern the exercise of any
options held by the Optionee at the time of cessation of Service or death:
a) Should the Optionee cease to remain in Service for any
reason other than death, Permanent Disability or
Misconduct, then the Optionee shall have a period of
three months following the date of such cessation of
Service during which to exercise each outstanding option
held by such Optionee.
b) Should Optionee's Service terminate by reason of
Permanent Disability, then the Optionee shall have a
period of 12 months following the date of such cessation
of Service during which to exercise each outstanding
option held by such Optionee.
c) If the Optionee dies while holding an outstanding
option, then the personal representative of his or her
estate or the person or persons to whom the option is
transferred pursuant to the Optionee's will or the laws
of inheritance shall have a 12-month period following
the date of the Optionee's death to exercise such
option.
d) Under no circumstances, however, shall any such option
be exercisable after the specified expiration of the
option term.
e) During the applicable post-Service exercise period, the
option may not be exercised in the aggregate for more
than the number of vested shares for which the option is
exercisable on the date of the Optionee's cessation of
Service. Upon the expiration of the applicable exercise
period or (if earlier) upon the expiration of the option
term, the option shall terminate and cease to be
outstanding for any vested shares for which the option
has not been exercised. However, the option shall,
immediately upon the Optionee's cessation of Service,
terminate and cease to be outstanding with respect to
any and all option shares for which the option is not
otherwise at the time exercisable or in which the
Optionee is not otherwise at that time vested.
f) Should Optionee's Service be terminated for Misconduct,
then all outstanding options held by the Optionee shall
terminate immediately and cease to remain outstanding.
(ii) The Plan Administrator shall have the discretion, exercisable
either at the time an option is granted or at any time while the option
remains outstanding, to:
a) extend the period of time for which the option is to
remain exercisable following the Optionee's cessation of
Service or death from the limited period otherwise in
effect for that option to such greater period of time as
the Plan Administrator shall deem
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appropriate, but in no event beyond the expiration of
the option term, and/or
b) permit the option to be exercised, during the applicable
post-Service exercise period, not only with respect to
the number of vested shares of Common Stock for which
such option is exercisable at the time of the Optionee's
cessation of Service but also with respect to one or
more additional installments in which the Optionee would
have vested under the option had the Optionee continued
in Service.
(d) STOCKHOLDER RIGHTS. The holder of an option shall have no stockholder
rights with respect to the shares subject to the option until such person shall
have exercised the option, paid the exercise price and become the recordholder
of the purchased shares.
(e) REPURCHASE RIGHTS. The Plan Administrator shall have the discretion to
grant options that are exercisable for unvested shares of Common Stock. Should
the Optionee cease Service while holding such unvested shares, the Corporation
shall have the right to repurchase, at the exercise price paid per share, any or
all of those unvested shares. The terms upon which such repurchase right shall
be exercisable (including the period and procedure for exercise and the
appropriate vesting schedule for the purchased shares) shall be established by
the Plan Administrator and set forth in the document evidencing such repurchase
right.
(f) FIRST REFUSAL RIGHTS. Until such time as the Common Stock is first
registered under Section 12 of the 1934 Act, the Corporation shall have the
right of first refusal with respect to any proposed disposition by the Optionee
(or any successor in interest) of any shares of Common Stock issued under the
Option Grant Program. Such right of first refusal shall be exercisable in
accordance with the terms established by the Plan Administrator and set forth in
the document evidencing such right.
(g) LIMITED TRANSFERABILITY OF OPTIONS. During the lifetime of the
Optionee, Incentive Options shall be exercisable only by the Optionee and shall
not be assignable or transferable other than by will or by the laws of descent
and distribution following the Optionee's death. Non-Statutory Options shall be
subject to the same restrictions, except that a Non-Statutory Option may, to the
extent permitted by the Plan Administrator, be assigned in whole or in part
during the Optionee's lifetime (i) as a gift to one or more members of the
Optionee's immediate family, to a trust in which Optionee and/or one or more
such family members hold more than 50% of the beneficial interest or to an
entity in which more than 50% of the voting interests are owned by one or more
such family members or (ii) pursuant to a domestic relations order. The terms
applicable to the assigned portion shall be the same as those in effect for the
option immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Plan Administrator may deem appropriate.
(h) WITHHOLDING. The Corporation's obligation to deliver shares of Common
Stock upon the exercise of any options granted under the Plan shall be subject
to the satisfaction of all applicable Federal, state and local income and
employment tax withholding requirements.
2.2 INCENTIVE OPTIONS. The terms specified below shall be applicable to
all Incentive Options. Except as modified by the provisions of this Section 2.2,
all the provisions of Articles 1, 2 and 4 shall be applicable to Incentive
Options. Options that are specifically designated as Non-Statutory Options shall
not be subject to the terms of this Section 2.2.
(a) ELIGIBILITY. Incentive Options may only be granted to Employees.
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(b) EXERCISE PRICE. The exercise price per share shall not be less than
100% of the Fair Market Value on the option grant date.
(c) DOLLAR LIMITATION. The aggregate Fair Market Value (determined as of
the respective date or dates of grant) for which one or more options granted to
any Employee under the Plan (or any other option plan of the Corporation or any
Parent or Subsidiary) may for the first time become exercisable as Incentive
Options during any one calendar year shall not exceed the sum of $100,000. To
the extent the Employee holds two or more such options that become exercisable
for the first time in the same calendar year, the foregoing limitation on the
exercisability of such options as Incentive Options shall be applied on the
basis of the order in which such options are granted.
(d) 10% STOCKHOLDER. If any Employee to whom an Incentive Option is
granted is a 10% Stockholder, then the exercise price per share shall not be
less than 110% of the Fair Market Value on the option grant date and the option
term shall not exceed five years measured from the option grant date.
2.3 CORPORATE TRANSACTION.
(a) The shares subject to each option outstanding under the Plan at the
time of a Corporate Transaction shall automatically vest in full so that each
such option shall, immediately prior to the effective date of the Corporate
Transaction, become fully exercisable for all of the shares of Common Stock at
the time subject to that option and may be exercised for any or all of those
shares as fully-vested shares of Common Stock. However, the shares subject to an
outstanding option shall NOT vest on such an accelerated basis if and to the
extent: (i) such option is assumed by the successor corporation (or parent
thereof) in the Corporate Transaction and the Corporation's repurchase rights
with respect to the unvested option shares are concurrently assigned to such
successor corporation (or parent thereof) or (ii) such option is to be replaced
with a cash incentive program of the successor corporation that preserves the
spread existing on the unvested option shares at the time of the Corporate
Transaction and provides for subsequent payout in accordance with the same
vesting schedule applicable to those unvested option shares or (iii) the
acceleration of such option is subject to other limitations imposed by the Plan
Administrator at the time of the option grant.
(b) All outstanding repurchase rights shall also terminate automatically,
and the shares of Common Stock subject to those terminated rights shall
immediately vest in full, in the event of any Corporate Transaction, except to
the extent: (i) those repurchase rights are assigned to the successor
corporation (or parent thereof) in connection with such Corporate Transaction or
(ii) such accelerated vesting is precluded by other limitations imposed by the
Plan Administrator at the time the repurchase right is issued.
(c) Immediately following the consummation of the Corporate Transaction,
all outstanding options shall terminate and cease to be outstanding, except to
the extent assumed by the successor corporation (or parent thereof).
(d) Each option that is assumed in connection with a Corporate Transaction
shall be appropriately adjusted, immediately after such Corporate Transaction,
to apply to the number and class of securities that would have been issuable to
the Optionee in consummation of such Corporate Transaction, had the option been
exercised immediately prior to such Corporate Transaction. Appropriate
adjustments shall also be made to (i) the number and class of securities
available for issuance under the Plan following the consummation of such
Corporate Transaction and (ii) the exercise price payable per share under each
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outstanding option, provided the aggregate exercise price payable for such
securities shall remain the same.
(e) The Plan Administrator shall have the discretion, exercisable either
at the time the option is granted or at any time while the option remains
outstanding, to provide for the automatic acceleration (in whole or in part) of
one or more outstanding options (and the immediate termination of the
Corporation's repurchase rights with respect to the shares subject to those
options) upon the occurrence of a Corporate Transaction, whether or not those
options are to be assumed in the Corporate Transaction.
(f) The Plan Administrator shall also have full power and authority,
exercisable either at the time the option is granted or at any time while the
option remains outstanding, to structure such option so that the shares subject
to that option will automatically vest on an accelerated basis should the
Optionee's Service terminate by reason of an Involuntary Termination within a
designated period (not to exceed 18 months) following the effective date of any
Corporate Transaction in which the option is assumed and the repurchase rights
applicable to those shares do not otherwise terminate. Any option so accelerated
shall remain exercisable for the fully-vested option shares until the earlier of
(i) the expiration of the option term or (ii) the expiration of the one-year
period measured from the effective date of the Involuntary Termination. In
addition, the Plan Administrator may provide that one or more of the
Corporation's outstanding repurchase rights with respect to shares held by the
Optionee at the time of such Involuntary Termination shall immediately terminate
on an accelerated basis, and the shares subject to those terminated rights shall
accordingly vest at that time.
(g) The portion of any Incentive Option accelerated in connection with a
Corporate Transaction shall remain exercisable as an Incentive Option only to
the extent the applicable $100,000 limitation is not exceeded. To the extent
such dollar limitation is exceeded, the accelerated portion of such option shall
be exercisable as a Non-Statutory Option under the Federal tax laws.
(h) The grant of options under the Plan shall in no way affect the right
of the Corporation to adjust, reclassify, reorganize or otherwise change its
capital or business structure or to merge, consolidate, dissolve, liquidate or
sell or transfer all or any part of its business or assets.
2.4 CANCELLATION AND REGRANT OF OPTIONS. The Plan Administrator shall have
the authority to effect, at any time and from time to time, with the consent of
the affected option holders, the cancellation of any or all outstanding options
under the Option Grant Program and to grant in substitution new options covering
the same or different number of shares of Common Stock but with an exercise
price per share based on the Fair Market Value on the new grant date.
ARTICLE 3. STOCK ISSUANCE PROGRAM.
3.1 STOCK ISSUANCE TERMS. Shares of Common Stock may be issued under the
Stock Issuance Program through direct and immediate issuances without any
intervening option grants. Each such stock issuance shall be evidenced by a
Stock Issuance Agreement that complies with the terms specified below.
(a) PURCHASE PRICE.
(i) The purchase price per share shall be fixed by the Plan
Administrator and may be less than, equal to or greater than the Fair
Market Value on the issue date.
(ii) Subject to the provisions of Section 4.1, shares of Common
Stock may be issued under the Stock Issuance Program for any of the
following items of
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consideration that the Plan Administrator may deem appropriate in each
individual instance:
a) cash or check made payable to the Corporation, or
b) past services rendered to the Corporation (or any Parent
or Subsidiary).
(b) VESTING PROVISIONS.
(i) Shares of Common Stock issued under the Stock Issuance Program
may, in the discretion of the Plan Administrator, be fully and immediately
vested upon issuance or may vest in one or more installments over the
Participant's period of Service or upon attainment of specified
performance objectives.
(ii) Any new, substituted or additional securities or other property
(including money paid other than as a regular cash dividend) that the
Participant may have the right to receive with respect to the
Participant's unvested shares of Common Stock by reason of any stock
dividend, stock split, recapitalization, combination of shares, exchange
of shares or other change affecting the outstanding Common Stock as a
class without the Corporation's receipt of consideration shall be issued
subject to (i) the same vesting requirements applicable to the
Participant's unvested shares of Common Stock and (ii) such escrow
arrangements as the Plan Administrator shall deem appropriate.
(iii) The Participant shall have full stockholder rights with
respect to any shares of Common Stock issued to the Participant under the
Stock Issuance Program, even if the Participant's interest in those shares
is not vested. Accordingly, the Participant shall have the right to vote
such shares and to receive any regular cash dividends paid on such shares.
(iv) Should the Participant cease to remain in Service while holding
unvested shares of Common Stock issued under the Stock Issuance Program or
should the performance objectives not be attained with respect to such
unvested shares of Common Stock, then those shares shall be immediately
surrendered to the Corporation for cancellation, and the Participant shall
have no further stockholder rights with respect to those shares. To the
extent the surrendered shares were previously issued to the Participant
for consideration paid in cash or cash equivalent (including the
Participant's purchase-money indebtedness), the Corporation shall repay to
the Participant the cash consideration paid for the surrendered shares and
shall cancel the unpaid principal balance of any outstanding
purchase-money note of the Participant attributable to the surrendered
shares.
(v) The Plan Administrator may in its discretion waive the surrender
and cancellation of one or more unvested shares of Common Stock (or other
assets attributable thereto) that would otherwise occur upon the
non-completion of the vesting schedule applicable to such shares. Such
waiver shall result in the immediate vesting of the Participant's interest
in the shares of Common Stock as to which the waiver applies. Such waiver
may be effected at any time, whether before or after the Participant's
cessation of Service or the attainment or non-attainment of the applicable
performance objectives.
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(c) FIRST REFUSAL RIGHTS. Until such time as the Common Stock is first
registered under Section 12 of the 1934 Act, the Corporation shall have the
right of first refusal with respect to any proposed disposition by the
Participant (or any successor in interest) of any shares of Common Stock issued
under the Stock Issuance Program. Such right of first refusal shall be
exercisable in accordance with the terms established by the Plan Administrator
and set forth in the document evidencing such right.
3.2 CORPORATE TRANSACTION.
(a) All of the outstanding repurchase rights under the Stock Issuance
Program shall terminate automatically, and all the shares of Common Stock
subject to those terminated rights shall immediately vest in full, in the event
of any Corporate Transaction, except to the extent: (i) those repurchase rights
are assigned to the successor corporation (or parent thereof) in connection with
such Corporate Transaction or (ii) such accelerated vesting is precluded by
other limitations imposed by the Plan Administrator at the time the repurchase
right is issued.
(b) The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time while
the Corporation's repurchase rights with respect to those shares remain
outstanding, to provide that those rights shall automatically terminate on an
accelerated basis, and the shares of Common Stock subject to those terminated
rights shall immediately vest, in the event the Participant's Service should
subsequently terminate by reason of an Involuntary Termination within a
designated period (not to exceed 18 months) following the effective date of any
Corporate Transaction in which those repurchase rights are assigned to the
successor corporation (or parent thereof).
3.3 SHARE ESCROW/LEGENDS. Unvested shares may, in the Plan Administrator's
discretion, be held in escrow by the Corporation until the Participant's
interest in such shares vests or may be issued directly to the Participant with
restrictive legends on the certificates evidencing those unvested shares.
ARTICLE 4. MISCELLANEOUS.
4.1 FINANCING. The Plan Administrator may permit any Optionee or
Participant to pay the option exercise price under the Option Grant Program or
the purchase price for shares issued under the Stock Issuance program by
delivering a full recourse, interest bearing promissory note payable in one or
more installments and secured by the purchased shares. The terms of any such
promissory note (including the interest rate and the terms of repayment) shall
be established by the Plan Administrator in its sole discretion. In no event
shall the maximum credit available to the Optionee or Participant exceed the sum
of (i) the aggregate option exercise price or purchase price payable for the
purchased shares plus (ii) any Federal, state and local income and employment
tax liability incurred by the Optionee or the Participant in connection with the
option exercise or share purchase.
4.2 EFFECTIVE DATE AND TERM OF THE PLAN.
(a) The Plan shall become effective when adopted by the Board, but no
option granted under the Plan may be exercised, and no shares shall be issued
under the Plan, until the Plan is approved by the Corporation's stockholders. If
such stockholder approval is not obtained within 12 months after the date of the
Board's adoption of the Plan, then all options previously granted under the Plan
shall terminate and cease to be outstanding, and no further options shall be
granted and no shares shall be issued under the Plan. Subject to such
limitation, the Plan Administrator may grant options and issue shares under the
Plan at any time after the effective date of the Plan and before the date fixed
herein for termination of the Plan.
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(b) The Plan shall terminate upon the earliest of (i) the expiration of
the ten-year period measured from the date the Plan is adopted by the Board,
(ii) the date on which all shares available for issuance under the Plan shall
have been issued as fully-vested shares or (iii) the termination of all
outstanding options in connection with an Corporate Transaction. All options and
unvested stock issuances outstanding at the time of a clause (i) termination
event shall continue to have full force and effect in accordance with the
provisions of the documents evidencing such options or issuances.
4.3 AMENDMENT OF THE PLAN.
(a) The Board shall have complete and exclusive power and authority to
amend or modify the Plan in any or all respects. However, no such amendment or
modification shall adversely affect any rights and obligations with respect to
options or unvested stock issuances at the time outstanding under the Plan,
unless the Optionee or the Participant consents to such amendment or
modification. In addition, certain amendments may require stockholder approval
pursuant to applicable laws or regulations.
(b) Options to purchase shares of Common Stock may be granted under the
Option Grant Program and shares of Common Stock may be issued under the Stock
Issuance Program that are in each instance in excess of the number of shares
then available for issuance under the Plan, provided any excess shares actually
issued under those programs shall be held in escrow until there is obtained
stockholder approval of an amendment sufficiently increasing the number of
shares of Common Stock available for issuance under the Plan. If such
stockholder approval is not obtained within 12 months after the date the first
such excess grants or issuances are made, then (i) any unexercised options
granted on the basis of such excess shares shall terminate and cease to be
outstanding and (ii) the Corporation shall promptly refund to the Optionees and
the Participants the exercise or purchase price paid for any excess shares
issued under the Plan and held in escrow, together with interest (at the
applicable short-term federal rate) for the period the shares were held in
escrow, and such shares shall thereupon be automatically canceled and cease to
be outstanding.
4.4 USE OF PROCEEDS. Any cash proceeds received by the Corporation from
the sale of shares of Common Stock under the Plan shall be used for general
corporate purposes.
4.5 WITHHOLDING. The Corporation's obligation to deliver shares of Common
Stock upon the exercise of any options or upon the issuance or vesting of any
shares issued under the Plan shall be subject to the satisfaction of all
applicable Federal, state and local income and employment tax withholding
requirements.
4.6 GOVERNING LAW. This Plan and the administration thereof shall be
governed by and construed in accordance with the laws of the State of Texas.
4.7 REGULATORY APPROVALS. The implementation of the Plan, the granting of
any option under the Plan and the issuance of any shares of Common Stock (i)
upon the exercise of any option or (ii) under the Stock Issuance Program shall
be subject to the Corporation's procurement of all approvals and permits
required by regulatory authorities having jurisdiction over the Plan, the
options granted under it and the shares of Common Stock issued pursuant to it.
4.8 NO EMPLOYMENT OR SERVICE RIGHTS. Nothing in the Plan shall confer upon
the Optionee or the Participant any right to continue in Service for any period
of specific duration or interfere with or otherwise restrict in any way the
rights of the Corporation (or any Parent or Subsidiary employing or
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retaining such person) or of the Optionee or the Participant, which rights are
hereby expressly reserved by each, to terminate such person's Service at any
time for any reason, with or without cause.
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APPENDIX
The following definitions shall be in effect under the Plan:
"Board" means the Corporation's Board of Directors.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means a committee of one or more Board members appointed by the
Board to exercise one or more administrative functions under the Plan.
"Common Stock" means the common stock, $.01 par value, of the Corporation.
"Corporate Transaction" means either of the following stockholder-approved
transactions to which the Corporation is a party:
(a) a merger or consolidation in which securities possessing more than
50% of the total combined voting power of the Corporation's
outstanding securities are transferred to a person or persons
different from the persons holding those securities immediately
prior to such transaction, or
(b) the sale, transfer or other disposition of all or substantially all
of the Corporation's assets in complete liquidation or dissolution
of the Corporation.
"Corporation" means Glowbug.com, Inc., a Delaware corporation, and any successor
corporation to all or substantially all of the assets or voting stock of
Glowbug.com, Inc. that shall by appropriate action adopt the Plan.
"Employee" means an individual who is in the employ of the Corporation (or any
Parent or Subsidiary), subject to the control and direction of the employer
entity as to both the work to be performed and the manner and method of
performance.
"Exercise Date" means the date on which the Corporation shall have received
written notice of the option exercise.
"Fair Market Value" means the fair market value per share of Common Stock on any
relevant date as determined in accordance with the following provisions:
(a) If the Common Stock is at the time traded on the Nasdaq National
Market, then the Fair Market Value shall be the closing selling
price per share of Common Stock on the date in question, as such
price is reported by the National Association of Securities Dealers
on the Nasdaq National Market. If there is no closing selling price
for the Common Stock on the date in question, then the Fair Market
Value shall be the closing selling price on the last preceding date
for which such quotation exists.
(b) If the Common Stock is at the time listed on any Stock Exchange,
then the Fair Market Value shall be the closing selling price per
share of Common Stock on the date in question on the Stock Exchange
determined by the Plan Administrator to be the primary market for
the Common Stock, as such price is officially quoted in the
composite tape of
<PAGE>
transactions on such exchange. If there is no closing selling price
for the Common Stock on the date in question, then the Fair Market
Value shall be the closing selling price on the last preceding date
for which such quotation exists.
(c) If the Common Stock is at the time neither listed on any Stock
Exchange nor traded on the Nasdaq National Market, then the Fair
Market Value shall be determined by the Plan Administrator after
taking into account such factors as the Plan Administrator shall
deem appropriate.
"Incentive Option" means an option that satisfies the requirements of Section
422 of the Code.
"Involuntary Termination" means the termination of the Service of any individual
that occurs by reason of:
(a) such individual's involuntary dismissal or discharge by the
Corporation for reasons other than Misconduct, or
(b) such individual's voluntary resignation following (A) a change in
his or her position with the Corporation that materially reduces his
or her duties and responsibilities or the level of management to
which he or she reports or (B) a reduction in his or her level of
compensation (including base salary, fringe benefits and target
bonuses under any corporate-performance based bonus or incentive
programs) by more than 20%, provided and only if such change or
reduction is effected without the individual's consent.
"Misconduct" means (i) the Optionee or Participant having been convicted of, or
plea of guilty or NOLO CONTENDERE to, any felony or a crime that involves moral
turpitude (excluding minor traffic violations), (ii) the commission of any act
of fraud, embezzlement or dishonesty by such person, (iii) any unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Corporation (or any Parent or Subsidiary) or (iv) any other intentional
misconduct by such person adversely affecting the business or affairs of the
Corporation (or any Parent or Subsidiary) in a material manner. The foregoing
definition shall not be deemed to be inclusive of all the acts or omissions that
the Corporation (or any Parent or Subsidiary) may consider as grounds for the
dismissal or discharge of any Optionee, Participant or other person in the
Service of the Corporation (or any Parent or Subsidiary).
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"Non-Statutory Option" means an option not intended to satisfy the requirements
of Section 422 of the Code.
"Option Grant Program" means the option grant program in effect under the Plan.
"Optionee" means any person to whom an option is granted under the Option Grant
Program.
"Parent" means any corporation (other than the Corporation) in an unbroken chain
of corporations ending with the Corporation, provided each corporation in the
unbroken chain (other than the Corporation) owns, at the time of the
determination, 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.
"Participant" means any person who is issued shares of Common Stock under the
Stock Issuance Program.
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"Permanent Disability" means the inability of the Optionee or the Participant to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that is expected to result in such
person's death or to continue for a period of 12 consecutive months or more.
"Plan" means the Corporation's 2000 Stock Option/Stock Issuance Plan, as set
forth in this document.
"Plan Administrator" means either the Board or the Committee acting in its
capacity as administrator of the Plan.
"Service" means the provision of services to the Corporation (or any Parent or
Subsidiary) by a person in the capacity of an Employee, a non-employee member of
the board of directors or a consultant or independent advisor, except to the
extent otherwise specifically provided in the documents evidencing the option
grant or stock issuance.
"Stock Exchange" means either the American Stock Exchange or the New York Stock
Exchange.
"Stock Issuance Agreement" means the agreement entered into by the Corporation
and the Participant at the time of issuance of shares of Common Stock under the
Stock Issuance Program.
"Stock Issuance Program" means the stock issuance program in effect under the
Plan.
"Subsidiary" means any corporation (other than the Corporation) in an unbroken
chain of corporations beginning with the Corporation, provided each corporation
(other than the last corporation) in the unbroken chain owns, at the time of the
determination, 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.
"10% Stockholder" means the owner of stock (as determined under Section 424(d)
of the Code) possessing more than 10% of the total combined voting power of all
classes of stock of the Corporation (or any Parent or Subsidiary).
