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SOFTQUAD SOFTWARE LTD.
2000 STOCK OPTION PLAN
INTRODUCTION
SoftQuad Software Ltd., a Delaware corporation (the
"Corporation"), hereby establishes an incentive compensation plan to be known as
the "SOFTQUAD SOFTWARE LTD. 2000 STOCK OPTION PLAN" (the "Plan"), as set forth
in this document. The Plan permits the grant of Non-Qualified Stock Options and
Incentive Stock Options.
The Plan shall become effective on February 25, 2000. However,
it shall be rendered null and void and have no effect, and any and all Options
granted hereunder shall be canceled, if the Plan is not approved by a majority
vote of the Corporation's stockholders within twelve (12) months of the date the
Plan is adopted by the Corporation's Board of Directors.
The purpose of the Plan is to promote the success and enhance
the value of the Corporation by linking the personal interests of Optionees to
those of the Corporation's stockholders by providing Optionees with an incentive
for outstanding performance. The Plan is further intended to assist the
Corporation in its ability to motivate, and retain the services of, Optionees
upon whose judgment, interest and special effort the successful conduct of its
and its subsidiaries' operations is largely dependent.
ARTICLE I
DEFINITIONS
For purposes of the Plan, the following terms shall be defined
as follows unless the context clearly indicates otherwise:
(a) "Award Agreement" shall mean the written agreement, executed
by an appropriate officer of the Corporation, pursuant to
which an Option is granted.
(b) "Board of Directors" shall mean the Board of Directors of the
Corporation.
(c) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations thereunder.
(d) "Committee" shall mean the Board of Directors or any committee
of two or more persons designated by the Board of Directors to
perform the functions of the Committee hereunder.
(e) "Common Stock" shall mean the common stock $0.001 par value of
the Corporation as authorized from time to time.
(f) "Consultant" shall mean an individual who provides bona-fide
consulting services to the Corporation or any Parent or
Subsidiary.
(g) "Corporation" shall mean SoftQuad Software Ltd., a Delaware
corporation.
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(h) "Disability" shall have the same meaning as the term
"permanent and total disability" under Section 22(e)(3) of the
Code.
(i) "Employee" shall mean a common law employee of the Corporation
or of any Parent or Subsidiary.
(j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder.
(k) "Fair Market Value" of the Corporation's Common Stock on a
Trading Day shall mean the last reported sale price for Common
Stock or, in case no such reported sale takes place on such
Trading Day, the average of the closing bid and asked prices
for the Common Stock for such Trading Day, in either case on
the principal national securities exchange on which the Common
Stock is listed or admitted to trading, or if the Common Stock
is not listed or admitted to trading on any national
securities exchange, but is traded in the over-the-counter
market, the closing sale price of the Common Stock or, if no
sale is publicly reported, the average of the closing bid and
asked quotations for the Common Stock, as reported by the
National Association of Securities Dealers Automated Quotation
System ("NASDAQ") or any comparable system or, if the Common
Stock is not listed on NASDAQ or a comparable system, the
closing sale price of the Common Stock or, if no sale is
publicly reported, the average of the closing bid and asked
prices, as furnished by two members of the National
Association of Securities Dealers, Inc. who make a market in
the Common Stock selected from time to time by the Corporation
for that purpose provided that, if the Committee determines
that "Fair Market Value" as determined in accordance with the
foregoing is not reflective of the fair value of the Common
Stock the Committee may, in its discretion fix "Fair Market
Value" based on its good faith determination of same. In
addition, for purposes of this definition, a "Trading Day"
shall mean, if the Common Stock is listed on any national
securities exchange, a business day during which such exchange
was open for trading and at least one trade of Common Stock
was effected on such exchange on such business day, or, if the
Common Stock is not listed on any national securities exchange
but is traded in the over-the-counter market, a business day
during which the over-the-counter market was open for trading
and at least one "eligible dealer" quoted both a bid and asked
price for the Common Stock. An "eligible dealer" for any day
shall include any broker-dealer who quoted both a bid and
asked price for such day, but shall not include any
broker-dealer who quoted only a bid or only an asked price for
such day. In the event the Corporation's Common Stock is not
publicly traded, the Fair Market Value of such Common Stock
shall be determined by the Committee in good faith.
(l) "Incentive Stock Option" shall mean a stock option satisfying
the requirements for tax-favored treatment under Section 422
of the Code.
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(m) "Non-Qualified Option" shall mean a stock option which does
not satisfy the requirements for, or which is not intended to
be eligible for, tax-favored treatment under Section 422 of
the Code.
(n) "Option" shall mean an Incentive Stock Option or a
Non-Qualified Stock Option granted pursuant to the provisions
of Section VI hereof.
(o) "Optionee" shall mean an individual who is granted an Option
under the terms of the Plan.
(p) "Outside Directors" shall mean members of the Board of
Directors of the Corporation who are "outside directors"
within the meaning of Section 162(m) of the Code.
(q) "Parent" shall mean a parent corporation of the Corporation
within the meaning of Section 424(e) of the Code.
(r) "Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations thereunder.
(s) "Subsidiary" shall mean a subsidiary corporation of the
Corporation within the meaning of Section 424(f) of the Code.
ARTICLE II
ADMINISTRATION
Unless otherwise determined by the Board of Directors, the
Plan shall be administered by the Committee, which shall be composed of two or
more Non-Employee Directors, as defined in Rule 16b-3(b)(3) promulgated under
the Exchange Act (to the extent Section 16 of the Exchange Act is applicable to
Options granted hereunder) and who also qualify as "Outside Directors" (but only
with respect to the period during which compensation attributable to Options
granted hereunder is subject to the deduction limitation of Section 162(m) of
the Code). Subject to the provisions of the Plan, the Committee may establish
from time to time such regulations, provisions, proceedings and conditions of
awards which, in its sole opinion, may be advisable in the administration of the
Plan. A majority of the Committee shall constitute a quorum, and, subject to the
provisions of Section V of the Plan, the acts of a majority of the members
present at any meeting at which a quorum is present, or acts approved in writing
by all of the members of the Committee, shall be the acts of the Committee as a
whole. If for any reason the Committee does not meet the requirements of Rule
16b-3 or Section 162(m) of the Code, such noncompliance shall not affect the
validity of the awards, grants, interpretations or other actions of the
Committee
ARTICLE III
SHARES AVAILABLE
Subject to the adjustments provided in Section VII of the
Plan, the aggregate number of shares which may be issued under the Plan shall
not exceed 4,899,500 shares. Shares of Common Stock underlying awards of
securities (derivative or not) shall be counted against the limitation set forth
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in the immediately preceding sentence and may be reused to the extent that the
related Option to any individual is settled in cash, expires, is terminated
unexercised, or is forfeited. Common Stock granted to satisfy Options under the
Plan may be authorized and unissued shares of the Common Stock, issued shares of
such Common Stock held in the Corporation's treasury or shares of Common Stock
acquired on the open market. No fractional shares of Common Stock may be issued
under the Plan.
ARTICLE IV
ELIGIBILITY
Officers and Employees of the Corporation or of any Parent or
Subsidiary and Consultants and directors of the Corporation or of any Parent or
Subsidiary who are not Employees, shall be eligible to participate in the Plan.
ARTICLE V
AUTHORITY OF COMMITTEE
The Plan shall be administered by, or under the direction of,
the Committee, which shall administer the Plan so as to comply at all times with
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder, to the extent such compliance is required, and with Section 162(m)
of the Code, to the extent that the Corporation is subject to the deduction
limitation thereunder, and shall otherwise have plenary authority to interpret
the Plan and to make all determinations specified in or permitted by the Plan or
deemed necessary or desirable for its administration or for the conduct of the
Committee's business. All interpretations and determinations of the Committee
may be made on an individual or group basis and shall be final, conclusive and
binding on all interested parties. Subject to the express provisions of the
Plan, the Committee shall have authority, in its discretion, to determine the
persons to whom Options shall be granted, the times when such Options shall be
granted, the number of Options, the exercise price of each Option, the period(s)
during which an Option shall be exercisable (whether in whole or in part), the
restrictions to be applicable to Options and the other terms and provisions
thereof (which need not be identical). In addition, the authority of the
Committee shall include, without limitation, the following:
Procedures for Exercise of Option. The establishment of
procedures for an Optionee (i) to exercise an Option by payment of cash, (ii) to
have withheld from the total number of shares of Common Stock to be acquired
upon the exercise of an Option that number of shares having a Fair Market Value,
which, together with such cash as shall be paid in respect of fractional shares,
shall equal the Option exercise price of the total number of shares of Common
Stock to be acquired, (iii) to exercise all or a portion of an Option by
delivering that number of shares of Common Stock already owned by him having a
Fair Market Value which shall equal the Option exercise price for the portion
exercised and, in cases where an Option is not exercised in its entirety, and
subject to the requirements of the Code, to permit the Optionee to deliver the
shares of Common Stock thus acquired by him in payment of shares of Common Stock
to be received pursuant to the exercise of additional portions of such Option,
and (iv) to engage in any form of "cashless" exercise. The Committee may, in its
sole discretion, require that an exercise described under any one or more or the
methods described under clauses (ii), (iii) or (iv) of the immediately preceding
sentence (to the extent such exercise is, or is deemed to constitute, an
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exercise effected by the tendering of Common Stock) be consummated with Common
Stock (i) held by the Optionee for at least six (6) months or (ii) acquired by
the Optionee other than under the Plan or a similar program.
Withholding. The establishment of a procedure whereby a number
of shares of Common Stock may be withheld from the total number of shares of
Common Stock to be issued upon exercise of an Option or for the tender of shares
of Common Stock owned by any Optionee to meet any obligation of withholding for
taxes incurred by the Optionee upon such exercise. Such withholding shall not
exceed any minimum withholding rates required by applicable law. The Committee
may, in its sole discretion, require that if any such withholding is effected by
the tendering of Common Stock, such withholding shall be consummated with Common
Stock (i) held by the Optionee for at least six (6) months and/or (ii) acquired
by the Optionee other than under the Plan or a similar program.
ARTICLE VI
STOCK OPTIONS
The Committee shall have the authority, in its discretion, to
grant Incentive Stock Options or to grant Non-Qualified Stock Options or to
grant both types of Options. Notwithstanding anything contained herein to the
contrary, an Incentive Stock Option may be granted only to Employees of the
Corporation or of any Parent or Subsidiary now existing or hereafter formed or
acquired, and not to any director or Consultant who is not also such an
Employee. Subject to the adjustment provided in Section VII of the Plan, the
maximum number of shares of Common Stock with respect to which Options may be
granted during any calendar year to any Optionee shall not exceed the maximum
amount permitted by applicable law or regulation for grants to employees. The
terms and conditions of the Options shall be determined from time to time by the
Committee; provided, however, that the Options granted under the Plan shall be
subject to the following limitations:
(a) Exercise Price. The Committee shall establish the exercise
price at the time any Option is granted at such amount as the
Committee shall determine; provided, however, that the
exercise price for each share of Common Stock purchasable
under any Option which is intended to satisfy the
performance-based compensation exemption to the deduction
limitation under Section 162(m) of the Code or any Incentive
Stock Option granted hereunder shall be such amount as the
Committee shall, in its best judgment, determine to be not
less than one hundred percent (100%) of the Fair Market Value
per share of Common Stock at the date the Option is granted;
and provided, further, that in the case of an Incentive Stock
Option granted to a person who, at the time such Incentive
Stock Option is granted, owns shares of stock of the
Corporation or of any Parent or Subsidiary which possess more
than ten percent (10%) of the total combined voting power of
all classes of shares of stock of the Corporation or of any
Parent or Subsidiary, the exercise price for each share of
Common Stock shall be such amount as the Committee, in its
best judgment, shall determine to be not less than one hundred
ten percent (110%) of the Fair Market Value per share of
Common Stock at the date the Option is granted. The exercise
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price will be subject to adjustment in accordance with the
provisions of Section VII of the Plan.
(b) Payment of Exercise Price. The exercise price per share of
Common Stock with respect to each Option shall be payable at
the time the Option is exercised. Such price shall be payable
in cash or pursuant to any of the other methods set forth in
Sections V(a) or (b) hereof, as permitted by the Committee
from time to time. Shares of Common Stock delivered to the
Corporation in payment of the exercise price shall be valued
at the Fair Market Value of the Common Stock on the date
preceding the date of the exercise of the Option.
(c) Exercisability of Options. Except as provided in Section VI(e)
hereof, each Option shall be exercisable in whole or in
installments, and at such time(s), and subject to the
fulfillment of any conditions on, and to any limitations on,
exercisability as may be determined by the Committee at the
time of the grant of such Options or thereafter. The right to
purchase shares of Common Stock shall be cumulative so that
when the right to purchase any shares of Common Stock has
accrued such shares of Common Stock or any part thereof may be
purchased at any time thereafter until the expiration or
termination of the Option.
(d) Expiration of Options. No Option by its terms shall be
exercisable after the expiration of ten (10) years from the
date of grant of the Option; provided, however, in the case of
an Incentive Stock Option granted to a person who, at the time
such Option is granted, owns shares of stock of the
Corporation or of any Parent or Subsidiary possessing more
than ten percent (10%) of the total combined voting power of
all classes of shares of stock of the Corporation or of any
Parent or Subsidiary, such Option shall not be exercisable
after the expiration of five (5) years from the date such
Option is granted.
(e) Exercise Upon Optionee's Termination of Employment or Service.
Unless otherwise determined by the Committee at the time of
grant or, if the Optionee's rights are not reduced thereafter,
upon the termination of the employment or services of an
Optionee by the Corporation or by any Parent or Subsidiary for
any reason, any Stock Option granted to such Optionee shall
remain exercisable (but solely to the extent exercisable on
the termination date) for ninety (90) days (one (1) year in
the case of termination due to death or Disability) after the
date of such termination of employment or service. For
purposes of determining whether any Optionee has incurred a
termination of employment or service, an Optionee who is both
an Employee (or a Consultant) and a director of the
Corporation and/or any Parent or Subsidiary shall be
considered to have incurred a termination of employment or
service only upon his termination of service both as an
Employee (or as a Consultant) and as a director.
(f) Maximum Amount of Incentive Stock Options. Except as otherwise
required by applicable law, each Option under which Incentive
Stock Options are granted shall provide that to the extent the
sum of (i) the Fair Market Value of the shares of Common Stock
(determined as of the time of the grant of the Option) subject
to such Incentive Stock Option plus (ii) the fair market
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values (determined as of the date(s) of grant of the
option(s)) of all other shares of Common Stock subject to
incentive stock options granted to an Optionee by the
Corporation or any Parent or Subsidiary, which are exercisable
for the first time by any person during any calendar year,
exceed(s) U.S. One Hundred Thousand Dollars (U.S.$100,000),
such excess shares of Common Stock shall not be deemed to be
purchasable pursuant to Incentive Stock Options, but shall be
deemed to be purchasable pursuant to Non-Qualified Options
(with such Non-Qualified Options being the last-issued of the
subject Options). The terms of the immediately preceding
sentence shall be applied by taking all options, whether or
not granted under the Plan, into account in the order in which
they are granted.
(g) Reload Options. (i) Concurrently with the award of an Option
(for these purposes, the "Primary Option") to an Optionee, the
Committee may, in its sole discretion, authorize the award of
an additional Option or Options (hereinafter referred to as
"Reload Options") to such Optionee providing for the purchase
of shares of Common Stock in an amount equal to the sum of:
(A) the number of shares of Common Stock, if any, used to
pay the exercise price of the Primary Option; and
(B) to the extent authorized by the Committee, the number
of shares of Common Stock used to satisfy any tax
withholding requirement related to the exercise of
the Primary Option.
For purposes of this subsection (g), upon its exercise a Reload Option
shall be treated as a Primary Option.
(i) The grant of a Reload Option will become effective
upon the exercise of the Primary Option. At the
discretion of the Committee, a Reload Option may be
an Incentive Stock Option.
(ii) To the extent that the exercise of any Option will
result in the award of a Reload Option, the Award
Agreement under which such Option is granted must
provide that the exercise of such Primary Option will
result in the award of a related Reload Option, which
will be evidenced under a separate Award Agreement.
The terms of such Award Agreement shall include,
among other items, provisions providing that (A) the
exercise price per share of Common Stock available
for purchase under the Reload Option shall, unless
otherwise determined by the Committee, be no less
than one hundred (100%) of the Fair Market Value of
such Common Stock on the date the Reload Option is
granted and (B) the term of the Reload Option shall
not extend beyond the remaining term of the Primary
Option.
(iii) Notwithstanding the above, no Reload Option will be
granted pursuant to the exercise of a Primary Option
if such exercise occurs after the termination of the
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Optionee's employment or service with the Corporation
and each Parent or Subsidiary.
ARTICLE VII
ADJUSTMENT OF SHARES; MERGER OR
CONSOLIDATION, ETC. OF THE CORPORATION
(a) Recapitalization, Etc. In the event there is any change in the
outstanding Common Stock of the Corporation by reason of any
reorganization, recapitalization, stock split, reverse stock
split, stock dividend, combination of shares or otherwise,
there shall be substituted for or added to each share of
Common Stock theretofore appropriated or thereafter subject,
or which may become subject, to any Option, the number and
kind of shares of stock or other securities into which each
outstanding share of Common Stock shall be so changed or for
which each such share shall be exchanged, or to which each
such share shall be entitled, as the case may be, and the per
share price thereof also shall be appropriately adjusted.
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 to be other than an incentive stock
option for purposes of Section 422 of the Code.
(b) Merger, Consolidation or Change in Control of Corporation.
Upon (i) the merger or consolidation of the Corporation with
or into another entity (pursuant to which the stockholders of
the Corporation immediately prior to such merger or
consolidation will not, as of the date of such merger or
consolidation, own a beneficial interest in shares of voting
securities of the entity surviving such merger or
consolidation having at least a majority of the combined
voting power of such corporation's then outstanding
securities) if, unless otherwise provided in the subject Award
Agreement, the agreement of merger or consolidation does not
provide for (1) the continuance of the Options granted
hereunder or (2) the substitution of new options for Options
granted hereunder, or for the assumption of such Options by
the surviving entity, (ii) the dissolution, liquidation, or
sale or other disposition of all or substantially all the
assets of the Corporation to a person unrelated to the
Corporation or to a direct or indirect owner of a majority of
the voting power of the Corporation's then outstanding voting
securities (such sale or other disposition of assets being
referred to as an "Asset Sale") or (iii) the Change in Control
of the Corporation, then the holder of any such Option
theretofore granted and still outstanding (and not otherwise
expired) shall have the right immediately prior to the
effective date of such merger, consolidation, dissolution,
liquidation, Asset Sale or Change in Control of the
Corporation to exercise such Option(s) in whole or in part
without regard to any installment provision that may have been
made part of the terms and conditions of such Option(s);
provided that, unless otherwise provided in the subject Award
Agreement, all conditions precedent to the exercise of such
Option(s), other than the passage of time, have occurred. The
Corporation, to the extent practicable, shall give advance
notice to affected Optionees of such merger, consolidation,
dissolution, liquidation, Asset Sale or Change in Control of
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the Corporation. Unless otherwise provided in the subject
Award Agreement or merger, consolidation or Asset Sale
agreement, all such Options which are not so exercised shall
be forfeited as of the effective time of such merger,
consolidation, dissolution, liquidation or Asset Sale (but not
in the case of a Change in Control of the Corporation). In the
event the Corporation becomes a subsidiary of another
corporation or entity (the "New Parent Corporation") with
respect to which the stockholders of the Corporation (as
determined immediately before such transaction) own,
immediately after such transaction, a beneficial interest in
shares of voting securities of the New Parent Corporation
having at least a majority of the combined voting power of
such New Parent Corporation's then outstanding securities,
there shall be substituted for Options granted hereunder,
options to purchase common stock of the New Parent
Corporation. The substitution described in the immediately
preceding sentence shall be effected in a manner such that any
option granted by the New Parent Corporation to replace an
Incentive Stock Option granted hereunder shall satisfy the
requirements of Section 422 of the Code.
(c) Definition of Change in Control of the Corporation. As used
herein, a "Change in Control of the Corporation" shall be
deemed to have occurred if any person (including any
individual, firm, partnership or other entity) together with
all Affiliates and Associates (as defined under Rule 12b-2 of
the General Rules and Regulations promulgated under the
Exchange Act) of such person (but excluding (i) a trustee or
other fiduciary holding securities under an employee benefit
plan of the Corporation or any Subsidiary of the Corporation,
(ii) a corporation owned, directly or indirectly, by the
stockholders of the Corporation in substantially the same
proportions as their ownership of the Corporation, (iii) the
Corporation or any Subsidiary of the Corporation or (iv) a
person who is a ten percent (10%) or greater stockholder of
the Corporation or an Affiliate or Associate of a ten percent
(10%) stockholder of the Corporation on the date of
stockholder approval of the Plan is or becomes the Beneficial
Owner (as defined in Rule 13d-3 promulgated under the Exchange
Act), directly or indirectly, of securities of the Corporation
representing fifty percent (50%) or more of the combined
voting power of the Corporation's then outstanding securities.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
(a) Administrative Procedures. The Committee may establish any
procedures determined by it to be appropriate in discharging
its responsibilities under the Plan. All actions and decisions
of the Committee shall be final.
(b) Assignment or Transfer. No grant or award of any Option or any
rights or interests therein shall be assignable or
transferable by an Optionee except by will or the laws of
descent and distribution. During the lifetime of an Optionee,
Options granted hereunder shall be exercisable only by the
Optionee. Notwithstanding the foregoing, the Committee may
permit an Optionee to transfer a Non-Qualified Option subject
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to such terms and conditions as it deems appropriate from time
to time.
(c) Investment Representation. With respect to shares of Common
Stock received pursuant to the exercise of an Option, the
Committee may require, as a condition of receiving such
securities, that the Optionee furnish to the Corporation such
written representations and information as the Committee deems
appropriate to permit the Corporation, in light of the
existence or nonexistence of an effective registration
statement under the Securities Act, to deliver such securities
in compliance with the provisions of the Securities Act.
(d) Withholding Taxes. In the case of the issuance or distribution
of Common Stock or other securities hereunder upon the
exercise of any Option, the Corporation, as a condition of
such issuance or distribution, may require the payment
(through withholding from the Optionee's salary, reduction of
the number of shares of Common Stock or other securities to be
issued, or otherwise) of any federal, state, local or foreign
taxes required to be withheld. Each Optionee may satisfy the
withholding obligations by paying to the Corporation (or the
appropriate Parent or Subsidiary) a cash amount equal to the
amount required to be withheld or, subject to the Committee's
consent thereto, by tendering to the Corporation (or to the
appropriate Parent or Subsidiary) a number of shares of Common
Stock having a value equivalent to such cash amount, or by use
of any available procedure approved by the Committee as
described under Section V(c) hereof.
(e) Costs and Expenses. The costs and expenses of administering
the Plan shall be borne by the Corporation and shall not be
charged against any award nor to any individual receiving an
Option.
(f) Funding of Plan. The Plan shall be unfunded. The Corporation
shall not be required to segregate any of its assets to assure
the payment of any Option under the Plan. Neither the
Optionees nor any other persons shall have any interest in any
fund or in any specific asset or assets of the Corporation or
any other entity by reason of any Option, except to the extent
expressly provided hereunder.
(g) Other Incentive Plans. The adoption of the Plan does not
preclude the adoption by appropriate means of any other
incentive plan for employees.
(h) Plurals and Gender. Where appearing in the Plan, the masculine
gender shall include the feminine and neuter genders, and the
singular shall include the plural, and vice versa, unless the
context clearly indicates a different meaning.
(i) Headings. The headings and sub-headings in the Plan are
inserted for the convenience of reference only and are to be
ignored in any construction of the provisions hereof.
(j) Severability. In case any provision of the Plan shall be held
illegal or void, such illegality or invalidity shall not
affect the remaining provisions of the Plan, but shall be
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fully severable, and the Plan shall be construed and enforced
as if said illegal or invalid provisions had never been
inserted herein.
(k) Liability and Indemnification.
(i) Neither the Corporation nor any Parent or Subsidiary
shall be responsible in any way for any action or
omission of the Committee, or any other fiduciaries
in the performance of their duties and obligations as
set forth in the Plan. Furthermore, neither the
Corporation nor any Parent or Subsidiary shall be
responsible for any act or omission of any of their
agents, or with respect to reliance upon advice of
their counsel, provided that the Corporation and/or
the appropriate Parent or Subsidiary relied in good
faith upon the action of such agent or the advice of
such counsel.
(ii) Neither the Corporation, any Parent or Subsidiary,
the Committee, nor any agents, employees, officers,
directors or stockholders of any of them, nor any
other person shall have any liability or
responsibility with respect to the Plan, except as
expressly provided herein.
(l) Incapacity. If the Committee shall receive evidence
satisfactory to it that a person entitled to exercise any
Option is, at the time when such Option becomes exercisable, a
minor, or is physically or mentally incompetent to receive
such Option and to give a valid release thereof, and that
another person or an institution is then maintaining or has
custody of such person and that no guardian, committee or
other representative of the estate of such person shall have
been duly appointed, the Committee may permit such Option to
be exercised by such other person or institution, including a
custodian under a Uniform Gifts to Minors Act or corresponding
legislation (who shall be an adult, a guardian of the minor or
a trust company), and the release by such other person or
institution shall be a valid and complete discharge for the
exercise of such Option.
(m) Cooperation of Parties. All parties to the Plan and any person
claiming any interest hereunder agree to perform any and all
acts and execute any and all documents and papers which are
necessary or desirable for carrying out the Plan or any of its
provisions.
(n) Governing Law. All questions pertaining to the validity,
construction and administration of the Plan shall be
determined in accordance with the laws of the State of
Delaware, without regard to its principles of conflicts of
law.
(o) Non-guarantee of Employment, Directorship or Consultancy.
Nothing contained in the Plan shall be construed as a contract
of employment (or as a consulting contract) between the
Corporation (or any Parent or Subsidiary), and any Optionee,
or to confer upon any Optionee the right to be continued in
the employment of, or service with, the Corporation (or any
Parent or Subsidiary), or as a limitation on the right of the
Corporation or any Parent or Subsidiary to discharge any of
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its Employees, Consultants or directors, at any time, with or
without cause.
(p) Notices. Each notice relating to the Plan shall be in writing
and delivered in person, by recognized overnight courier or by
certified mail to the proper address. Except as otherwise
provided in any Award Agreement with respect to the exercise
thereunder, all notices to the Corporation or the Committee
shall be addressed to it at 161 Eglinton Avenue East, Suite
400 Toronto, Ontario M4P 1J5 Attn: Chief Executive Officer or
to such other address as may be designated for such purpose by
the Corporation from time to time by notice given in the
manner herein provided. All notices to Optionees,
beneficiaries or other persons acting for or on behalf of such
persons shall be addressed to such person at the last address
for such person maintained in the Committee's records.
(q) Written Agreements. Each Option shall be evidenced by a signed
written agreement between the Corporation and the Optionee
containing the terms and conditions of the award.
(r) Limitation. No Incentive Stock Options may be granted
hereunder more than ten (10) years after the date of
effectiveness of the Plan.
ARTICLE IX
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors of the Corporation shall have the right to amend, suspend
or terminate the Plan at any time, provided that, to the extent required by
applicable law, rule or regulation, no amendment shall be made unless such
amendment is made by or with the approval of the stockholders of the Corporation
in accordance with applicable law. Except as otherwise provided herein, no
amendment, suspension or termination of the Plan or Award Agreement shall
adversely affect or impair the rights of any Optionee without his consent.
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SOFTQUAD SOFTWARE LTD.
2000 STOCK OPTION PLAN
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EFFECTIVE AS OF FEBRUARY 25, 2000
