Securities and Exchange Commission
Washington, D.C. 20549
Form 8-KSB
Current Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported): August 23, 1999
AmeriNet Group.com, Inc. formerly known as Equity Growth Systems, inc. (Exact
name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation
0-3718 (Commission File Number)
11-2050317 (IRS Employer Identification No.)
902 Clint Moore Road, Suite 136: Boca Raton, Florida 33487
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (561) 998-3435
Equity Growth System, inc., 8001 DeSoto Woods Drive; Sarasota, Florida 34243
(Former name or former address, if changed since last report)
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TABLE OF CONTENTS
Item Number Description Page Number
Item 5. Other Events
Item 6. Resignations of Registrant's Directors
Item 7. Financial Statements and Exhibits
Sources of Materials Incorporated by Reference
This report includes materials incorporated by reference from the
following previously filed reports or registration statements, as permitted by
Exchange Act Rule 12b-23: Reports on Form 8-KSB filed on August 17, 1998 and
Form 10-KSB for year ended December 31, 1998.
FORWARD LOOKING STATEMENTS
This Form 8-KSB contains certain "forward-looking statements" relating to
the Registrant which represent the Registrant's current expectations or beliefs,
including, but not limited to, statements concerning the Registrant's
operations, performance, financial condition and growth. For this purpose, any
statements contained in this Form 8-KSB that are not statements of historical
fact are forward-looking statements. Without limiting the generality of the
foregoing, words such as "may", "will", "expect", "believe", "anticipate",
"intend", "could", "estimate", or "continue", or the negative or other variation
thereof or comparable terminology are intended to identify forward-looking
statements. These statements by their nature involve substantial risks and
uncertainties, such as credit losses, dependence on management and key personnel
and variability of quarterly results, ability of the Registrant to continue its
growth strategy and competition, certain of which are beyond the Registrant's
control. Should one or more of these risks or uncertainties materialize or
should the underlying assumptions prove incorrect, actual outcomes and results
could differ materially from those indicated in the forward looking statements.
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ITEM 5 OTHER EVENTS
CONSIDERATION OF STOCK PLAN
At the request of the Registrant's board of directors and The Yankee
Companies, Inc., a Florida corporation that serves as a strategic consultant to
the Registrant ("Yankees"), has developed a proposed non-qualified stock option
and incentive stock option plan for use by the Registrant (the "Proposed Plan").
A copy of the Proposed Plan is included as an exhibit to this current report,
see "Item 7(c), Exhibit Index." The following summary of the Proposed Plan is
qualified in its entirety by reference to such exhibit.
The purpose of the Proposed Plan would be to attract and retain quality
personnel and to make association with the Registrant more attractive to
potential acquisition candidates. As currently contemplated, a maximum of
1,000,000 shares of the Registrant's common stock would be allocated for use in
conjunction with award of options under the Proposed Plan, and such common stock
could either be issued from treasury shares, authorized but theretofore unissued
shares, or shares purchased from current stockholders for such purpose.
The Proposed Plan would be administered by a committee of the Registrant's
board of directors comprised exclusively of outside directors (the "Committee"),
as that term is defined in the Internal Revenue Code of 1996, as amended (the
"Code") and potential recipients would include the Registrant's directors,
officers, key employees and consultants (other than consultant's that would be
ineligible for receipt of securities registered on Commission Form S-8 based on
then applicable rules adopted by the Commission). Options issuable would be
incentive stock options meeting the requirements of Section 422, et. seq. of the
Code, or non-qualified stock options, with the attributes determined by the
Committee. The adoption of the Proposed Plan, as currently contemplated, would
not restrict the ability of the Registrant's board of directors to authorize the
issuance of securities, including stock options, outside the parameters of the
Proposed Plan, on a case by case basis.
Initial recipients under the Proposed Plan are expected to be employees of
the Registrant's subsidiary, American Internet Technical Center, Inc., a Florida
corporation, (hereinafter referred to "American Internet")who meet designated
competitive sales targets and the Registrant's new president described below.
The Proposed Plan is in the review and discussion stage and no assurances
can be provided that it will be adopted as currently proposed, or at all. In the
event that the Proposed Plan is not adopted, the options called for in the
employment agreement for Michael Harris Jordan described below would still be
issued.
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MICHAEL HARRIS JORDAN
In conjunction with the resignation of Charles J. Scimeca ("Mr.
Scimeca"),effective August 6, 1999, the Registrant's acting president and a
member of the Registrant's board of directors, described in Item 6 below; on
August 5, 1999, the Registrant's board of directors elected Michael Harris
Jordan as its president and as a member of its board of directors, effective as
of August 6, 1999. Mr. Jordan's term as a director will expire following the
election and installation of his successor (assuming Mr. Jordan is not
re-elected) at the next annual meeting of the Registrant's stockholders. His
term as an officer is at the pleasure of the Registrant's board of directors,
subject to his contractual rights under the employment agreement summarized
below.
In light of his experience with the financial markets and the regulatory
requirements and limitations involved in corporate communications, Mr. Jordan
will also replace Ms. Piccolo as the Registrant's spokesperson.
BIOGRAPHY.
Michael Harris Jordan, President and Director
Michael Harris Jordan, 46 years old, is a resident and native of Miami,
Florida. From 1972 until 1973 he attended the University of Miami where he
studied English literature. In 1979, Mr. Jordan obtained a Series 7 and a Series
63 license from the NASD and in 1982 he obtained a Series 24 license from the
NASD (general securities principal). In conjunction with his activities as an
individual licensed to engage in securities transactions by the NASD, he was
also licensed by the securities regulatory authorities of a number of states.
Since 1985, Mr. Jordan has been engaged in business as a private investor.In
1992, Mr. Jordan incorporated Securities Counseling and Management, Inc., a
private consulting firm headquartered in Miami, Florida, for which he serves as
president and sole director. In January of 1996, Mr. Jordan became secretary,
treasurer and a member of the board of directors of Zagreus, Inc., a publicly
held Delaware corporation then headquartered in Miami, Florida ("Zagreus").
Zagreus is an inactive public company in the process of reorganization. In 1998,
Mr. Jordan became an independent consultant for The Southeast Companies, inc., a
Florida corporation engaged in providing business and political consulting
services and consumer financial services as a licensed mortgage brokerage
company and during 1998, became president of a division thereof operating in
compliance with Florida fictitious name laws as Southeast Counseling &
Management. In 1999, Mr. Jordan became a registered principal (NASD Series 24
license) of Sunshine Securities, Inc., an NASD member firm located in Orlando,
Florida. On August 6, 1999, Mr. Jordan became a member of the Registrant's board
of directors and was elected as the Registrant's President.
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FAMILY RELATIONSHIPS.
Mr. Jordan is not related to any current or former employees, officers,
directors or principal stockholders of the Registrant.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS.
Based on information provided in response to a questionnaire filed as an
exhibit to this report (see "Item 7(c), Exhibit Index"), during the past five
years Mr. Jordan has not been a party to or the subject of:
(a) Any bankruptcy petition filed by or against any business of which such
person was a general partner or executive officer either at the time of the
bankruptcy or within two years prior to that time;
(b) Any conviction in a criminal proceeding or has been subject to a
pending criminal proceeding (excluding traffic violations and other minor
offenses);
(c) Any order, judgment, or decree, not subsequently reversed, suspended
or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his involvement
in any type of business, securities or banking activities; or
(d) Been found by a court of competent jurisdiction (in a civil action),
the Commission or the Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, and the judgment has not been
reversed, suspended, or vacated.
COMPENSATION.
The terms of Mr. Jordan's compensation for services to the Registrant are
set forth in his employment agreement with the Registrant (the "Jordan
Agreement"), a copy of which is included as an exhibit to this current report,
see "Item 7(c), Exhibit Index," and are summarized below.
TERMS OF EMPLOYMENT
The following summary information extracted from the Jordan Agreement is
qualified in its entirety by reference to the Jordan Agreement.
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Duties: Mr. Jordan will:
Serveas the principal point of contact between the Registrant and the
media (print, electronic, voice and picture), the investment community
and the Registrant's security holders;
Be responsible for supervision of all of the Registrant's other officers;
Be responsible for the Registrant's compliance with all applicable laws,
including federal, state and local securities laws and tax laws;
Be responsible for supervision of the Registrant's subsidiaries; and,
Perform such other duties as are assigned to him by the Registrant's board
of directors, subject to compliance with all applicable laws and fiduciary
obligations.
Other Activities
Mr. Jordan has agreed to perform his employment duties in good faith and,
subject to the exceptions specified below, to devote substantially all of his
business time, energies and abilities to the proper and efficient management and
execution of such duties. In amplification of the foregoing, unless otherwise
authorized by the Registrant's board of directors, on a case by case basis, Mr.
Jordan is required to devote his business time exclusively to the affairs of the
Registrant; provided, however, that the Registrant has recognized that Mr.
Jordan is a party to an agreement with the Southeast Companies, Inc., which has
been assigned thereby to Yankees, calling for him to provide services thereto;
serves as president of Southeast Counseling & Management, a division of the
Southeast Companies, Inc.; serves as president of Securities Counseling &
Management, Inc., a Florida corporation; serves as an officer of Zagreus, Inc.,
a currently inactive public company in the process of reorganization; and, is a
registered representative and registered principal with Sunshine Securities
Corporation (which has consented in writing to Mr. Jordan's service as president
of the Registrant); and the Registrant has consented to Mr. Jordan's
continuation in such roles, provided that his role as the Registrant's president
takes priority in allocation of time and resources to any activities pertaining
to such roles, and that he will resolve any actual conflicts of interest
resulting from such roles in favor of the Registrant.
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Status:
Mr. Jordan will serve as an employee of the Registrant but shall have no
authority to act as an agent thereof or to bind the Registrant or its
subsidiaries as a principal or agent thereof without the specific consent of the
Registrant's board of directors, all such functions being reserved to the board
of directors in compliance with the requirements of its constituent documents
Limitations:
Mr. Jordan has agreed that he will not:
Release any financial or other material information or data about the
Registrant without the prior written consent and approval of the Registrant's
General Counsel; or, conduct any meetings with financial analysts without
informing the Registrant's General Counsel and board of directors in advance of
the proposed meeting and the format or agenda of such meeting.
Disclose to any third party any confidential non-public information
furnished by the Registrant except on a need to know basis, and in such case,
subject to appropriate assurances that such information shall not be used,
directly or indirectly, in any manner that would violate state or federal
prohibitions on insider trading of the Registrant's securities.
Take any action which would in any way adversely affect the reputation,
standing or prospects of the Registrant or which would cause the Registrant to
be in violation of applicable laws.
In any circumstances where Mr. Jordan is describing the securities of the
Registrant to a third party, Mr. Jordan has agreed to disclose to such person
any compensation received from the Registrant to the extent required under any
applicable laws, including, without limitation, Section 17(b) of the Securities
Act of 1933, as amended.
Term:
The Jordan Agreement is for a term of one year, subject to automatic annual
renewal thereafter unless the Party deciding not to renew provides the other
with written notice of intention not to renew prior to the 60th day before
termination of the then effective term or renewal thereof.
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Compensation:
A. An option to purchase up to 100,000 shares of the Registrant's common stock
during the 36 month period commencing at the end of the 365th day following
commencement of the initial term of the Jordan Agreement, at an exercise
price equal to the last reported price paid therefor on the effective date
of the employment agreement, as reported on the over the counter electronic
bulletin board operated by the NASD (i.e., $0.69 per share), provided that:
(1) He remains in the employ of the Registrant for a period of not less
than 365 consecutive days;
(2) He has not been discharged by the Registrant for cause;
(3) He fully complies with the provisions of the Jordan Agreement,
including, without limitation, the confidentiality and non-competition
sections hereof;
B. In the event that Mr. Jordan arranges or provides funding for the
Registrant on terms more beneficial than those reflected in the
Registrant's current principal financing agreements, copies of which are
included among the Registrant's records available through the SEC's EDGAR
web site, Mr. Jordan shall be entitled, at its election, to either:
(1) A fee equal to 5% of such savings, on a continuing basis; or
(2) If equity funding is provided through Mr. Jordan or any affiliates
thereof, a discount of 5% from the bid price for the subject equity securities,
if they are issuable as free trading securities, or, a discount of 25% from the
bid price for the subject equity securities, if they are issuable as restricted
securities (as the term restricted is used for purposes of SEC Rule 144); and
(3) If equity funding is arranged for the Registrant by Mr. Jordan and
the Registrant is not obligated to pay any other source compensation in
conjunction therewith, other than the normal commissions charged by broker
dealers in securities in compliance with the compensation guidelines of the
NASD, the Mr. Jordan shall be entitled to a bonus in a sum equal to 5% of the
net proceeds of such funding.
C. In the event that Mr.Jordan generates business for the Registrant, then, on
any sales resulting therefrom, Mr. Jordan shall be entitled to a commission
equal to 5% of the net income derived by the Registrant therefrom, on a
continuing basis.
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Benefits:
Mr. Jordan is entitled to any benefits generally made available to all
other employees (rather than to a specified employee or group of employees) of
the Registrant or its subsidiaries.
Indemnification:
The Registrant will defend, indemnify and hold Mr. Jordan harmless from all
liabilities, suits, judgments, fines, penalties or disabilities, including
expenses associated directly, therewith (e.g. legal fees, court costs,
investigative costs, witness fees, etc.) resulting from any reasonable actions
taken by him in good faith on behalf of the Registrant, its affiliates or for
other persons or entities at the request of the board of directors of the
Registrant, to the fullest extent legally permitted, and in conjunction
therewith, shall assure that all required expenditures are made in a manner
making it unnecessary for Mr. Jordan to incur any out of pocket expenses;
provided, however, that Mr. Jordan permits the Registrant to select and
supervise all personnel involved in such defense and that Mr. Jordan waives any
conflicts of interest that such personnel may have as a result of also
representing the Registrant, their stockholders or other personnel and agrees to
hold them harmless from any matters involving such representation, except such
as involve fraud or bad faith.
Early termination:
The Registrant can terminate the employment agreements severally, as to the
terminating entity only, for cause (e.g., the inability through sickness or
other incapacity to discharge duties for 21 or more consecutive days or for a
total of 45 or more days in a period of twelve consecutive months; refusal to
follow directions of the board of directors; dishonesty; theft; or conviction of
a crime involving moral turpitude; material default in the performance of
obligations, services or duties required under the employment agreement (other
than for illness or incapacity) or materially breach of any provision of the
employment agreement, which continues for 5 days after written notice if it
resulted in material damage); discontinuance of business; and death. In the
event of a dispute concerning termination due to breach or default, compensation
will be continued until resolution of such dispute by a tribunal of competent
jurisdiction, subject to repayment upon final determination that such
compensation was not called for.
The Jordan Agreement contains broad non-disparagement, confidentiality and
non-competition covenants subject to judicial restructuring if found to be
legally unenforceable which provide for both injunctive relief and liquidated
damages.
COMPENSATION UNDER PLANS
The Registrant's board of directors is considering adoption of a
non-qualified stock option and stock incentive plan, a copy of which is filed as
an exhibit to this current report [see "Item 7(c), Exhibit Index], and the board
of directors may in the future, if such plan is adopted, grant Mr. Jordan or
other officers, employees or directors of the Registrant stock options pursuant
to the provisions of such plan.
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ITEM 6 RESIGNATIONS OF REGISTRANT'S DIRECTORS
EDWARD GRANVILLE-SMITH
In accordance with the terms of a settlement agreement between the
Registrant and Edward Granville-Smith, Jr. (who served as the Registrants
principal officer and sole director from 1995 until November of 1998), the
Registrant elected his son, Mark Granville-Smith as a member of the Registrant's
board of directors, effective July 1, 1999. Details of the settlement agreement
were disclosed in the Registrant's report on Form 10-KSB for the year ended
December 31, 1998 and such agreement was filed as an exhibit thereto.
Mr. Edward Granville-Smith's replacement as a member of the Registrant's
board of directors did not involve any disagreements with the Registrant on any
matters and consequently, did not involve any disagreement relating to the
Registrant's operations, policies or practices. Rather, it was based on personal
problems involving his health described in detail in the Registrant's report on
Form 10-KSB for the year ended December 31, 1998.
CHARLES J. SCIMECA
On or about July 28, 1999, Charles J. Scimeca ("Mr. Scimeca"), the
Registrant's acting president and a member of the Registrant's board of
directors advised it that in light of the change in the Registrant's business,
it would be better served by a president with material experience in the
securities business, and more familiar with the regulatory obligations attendant
on engaging in capital raising and acquisition activities. Mr. Scimeca
instructed the Registrant's strategic consultant, The Yankee Companies, Inc.
("Yankees"), to commence a search for a suitable replacement, and on or about
August 2, 1999, Yankees recommended Michael Harris Jordan ("Mr. Jordan"). On
August 5, 1999, after interviews with management of the Registrant's subsidiary
and with the Registrant's board of directors, Mr. Jordan was offered the
position of president for a one year term and elected as a member of the
Registrant's board of directors replacing Mr. Scimeca, whose resignation was
accepted effective as of August 6, 1999. Required information concerning Mr.
Jordan's background, responsibilities and compensation is set forth in Item 5
above.
Mr. Scimeca's resignation did not involve any disagreements with the
Registrant on any matters and consequently, did not involve any disagreement
relating to the Registrant's operations, policies or practices. A copy of Mr.
Scimeca's letter of resignation is filed as an exhibit to this current report
(see Item 7(c), Exhibit Index").
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ITEM 7.FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
Item Page Description
Number Number
10.38 Proposed Stock Plan
10.39 Michael Harris Jordan employment agreement
99.44 Michael Harris Jordan questionnaire
99.45 Charles J. Scimeca letter of resignation
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AmeriNet Group.com, Inc.
A Delaware corporation
(Registrant)
Date: August 23, 1999
By: /s/Michael H. Jordan/s/
Michael H. Jordan, President
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AmeriNet Group.com, Inc.
Non-Qualified Stock Option & Stock Incentive Plan
Effective as of January 1 , 2000
AmeriNet Group.com, Inc.
Non-Qualified Stock Option & Stock Incentive Plan Indenture
State of Florida}
County of Palm Beach} ss.:
Pursuant to a duly adopted resolution of the Board of Directors, currently
in effect, and as authorized by the certificate of incorporation, bylaws and all
applicable federal and state laws, AmeriNet Group.com, Inc., a publicly held
Delaware corporation with a class of securities registered under Section 12(g)
of the Securities Exchange Act of 1934, as amended (hereinafter referred to as
the "Corporation"), intending to be legally bound, hereby establishes and
publishes an incentive compensation plan to be known as the "AmeriNet Group.com,
Inc. Non-Qualified Stock Option & Stock Incentive Plan" (hereinafter referred to
as the "Plan"), as follows:
Witnesseth:
ARTICLE ONE
INTRODUCTION
(a)Pursuant to the provisions, conditions and requirements set forth below, this
Plan hereby authorizes the grant of Non-Qualified Stock Options and Incentive
Stock Options, as such terms are defined in the Code and the rules and
regulations promulgated thereunder.
(b)This Plan shall become effective on January 1, 2000.
(c)The purpose of this Plan is to promote the success and enhance the value of
the Corporation by linking the personal interests of Participants to those of
the Corporation's stockholders by providing Participants with an incentive for
outstanding performance.
(d)This Plan is further intended to assist the Corporation in its ability to
acquire compatible businesses and to retain the services of, Participants upon
whose judgment, interest and special effort the successful conduct of the
Corporation's operations is largely dependent, and to align their personal
interests with those of the Corporation and its stockholders.
ARTICLE TWO
DEFINITIONS
For purposes of this 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 a Plan Award is
granted.
(b)"Board of Directors" shall mean the Board of Directors of the Corporation.
(c)"Commission" shall mean the United States Securities and Exchange
Commission.
(d)"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
rules and regulations thereunder.
(e)"Committee" shall mean all Outside Directors of the Corporation or all
Outside Directors appointed by the Board of Directors to serve as the Committee;
provided that the Committee must always be comprised of not less than three
members.
(f)"Common Stock" shall mean the common stock, par value $.001 per share, of the
Corporation.
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(g)"Consultant" shall mean an individual who is in a Consulting Relationship
with the Corporation or any Parent or Subsidiary, other than one principally
engaged in promoting the securities of the Corporation, as defined by applicable
rules of the Commission excluding persons so engaged from eligibility to
participate in registration of securities on Commission Form S-8.
(h)"Consulting Relationship" shall mean the relationship that exists between an
individual and the Corporation (or any Parent or Subsidiary) if such individual
or any entity of which such individual is an executive officer or owns a
substantial equity interest has entered into a written consulting contract with
the Corporation or any Parent or Subsidiary.
(i)"Corporation" shall mean AmeriNet Group.com, Inc., a Delaware corporation.
(j)"Disability" shall have the same meaning as the term "permanent and total
disability" under Section 22(e)(3) of the Code.
(k)"Employee" shall mean a common-law employee of the Corporation or of any
Parent or Subsidiary.
(l)"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder.
(m)"Executive" means an employee of the Corporation or of any Parent or
Subsidiary whose compensation is subject to the deduction limitations set forth
under Code Section 162(m).
(n)(1)"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, Inc., a Delaware corporation registered as a self regulatory
organization by the Commission (the "NASD"), through its NASDAQ Stock Market,
Inc., subsidiary's 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.
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(2) 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.
(3) 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.
(o)"Good Cause" shall mean:
(1) A Participant's willful or gross misconduct or willful or gross
negligence in the performance of his duties for the Corporation or for any
Parent or Subsidiary after prior written notice of such misconduct or
negligence and the continuance thereof for a period of 30 days after receipt by
such Participant of such notice;
(2) A Participant's intentional or habitual neglect of his duties for the
Corporation or for any Parent or Subsidiary after prior written notice of such
neglect;
(3) A Participant's theft or misappropriation of funds of the Corporation
or of any Parent or Subsidiary or commission of a felony; or
(4) The direct or indirect breach by the Participant of the terms of a
related consulting contract with the Corporation or any Parent or Subsidiary.
(p)"Incentive Stock Option" shall mean a stock option satisfying the
requirements for tax-favored treatment under Section 422 of the Code.
(q)"NASD" shall, unless the context requires otherwise, mean the National
Association of Securities Dealers, Inc., a Delaware corporation registered as a
self regulatory organization by the Commission, and its controlled subsidiaries.
(r)"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.
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(s)"Option" shall mean an Incentive Stock Option or a Non-Qualified Stock Option
granted pursuant to the provisions of Article Seven hereof, as such terms are
defined in the Code and the rules and regulations promulgated thereund er.
(t)"Option Holder" shall mean a Participant who is granted an Option under the
terms of this Plan.
(u)"Outside Directors" shall mean all members of the Board of Directors of the
Corporation other than those who also serve as officers, employees or
consultants of the Corporation or who hold more than 10% of the Corporation's
capital stock ("Inside Directors"), or who are related by marriage or
consanguinity to Inside Directors, and, who are classified as "outside
directors" under Section 162(m) of the Code.
(v)"Parent" shall mean a parent corporation of the Corporation within the
meaning of Section 424(e) of the Code.
(w)"Participant" shall mean any Employee or other person participating under
this Plan.
(x)"Plan Award" shall mean an Option granted pursuant to the terms of this Plan.
(y)"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations thereunder.
(z)"Service" shall mean the United States Internal Revenue Service.
(aa)"Subsidiary" shall mean a subsidiary corporation of the Corporation within
the meaning of Section 424(f) of the Code.
(bb)"Termination of Consulting Relationship" shall mean the cessation,
abridgement or termination of a Consultant's Consulting Relationship with the
Corporation or any Parent or Subsidiary as a result of:
(1) The Consultant's death or Disability;
(2) The disqualification of the Consultant from participation as a
recipient of securities of the Corporation on Commission Form S-8.
(3) The cancellation, annulment, expiration, termination or breach of the
written consulting contract between the Corporation(or any Parent or
Subsidiary) and the Consultant (or any other entity) giving rise to
the Consulting Relationship; or
(4) If the written consulting contract is not directly between the
Corporation (or any Parent or Subsidiary) and the Consultant, the
Consultant's termination of service with, or sale of all or
substantially all of his equity interest in, the entity which has
entered into the written consulting contract with the Corporation,
Parent or Subsidiary.
ARTICLE THREE
ADMINISTRATION
(a) (1) This Plan shall be administered by the Committee, which shall be
composed solely of at least two Non-Employee Directors, as defined in
Rule 16b-3(b)(3) promulgated under the Exchange Act, and who also
qualify as "Outside Directors".
(2) Subject to the provisions of this 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 this Plan.
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(b) A majority of the Committee shall constitute a quorum, and, subject to the
provisions of Article Six of this 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 a majority of the Committee, shall be the acts of the Committee as a whole.
ARTICLE FOUR
SHARES AVAILABLE
(a)Subject to the adjustments provided in Article Eight of this Plan, the
aggregate number of shares of the Common Stock which may be granted for all
purposes under this Plan shall be 1,000,000 shares.
(b)Shares of Common Stock underlying awards of securities (derivative or not)
and shares of Common Stock awarded hereunder (whether or not on a restricted
basis) shall be counted against the limitation set forth in the immediately
preceding sentence and may be reused to the extent that the related Plan Award
to any individual is settled in cash, expires, is terminated unexercised, or is
forfeited.
(c)Common Stock granted to satisfy Plan Awards under this 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.
(d)Notwithstanding the foregoing, the Corporation's transfer agent and its
general counsel shall:
(1) Retain a copy of this Plan, and any amendments or supplements thereof,
in its records of the Corporation's affairs;
(2) Be provided with and retain copies of all instruments effecting Plan
Awards;
(3) Assure that shares adequate to meet the Corporation's obligations
under the Plan are reserved for issuance in compliance therewith;
(4) Immediately notify the Corporation and any Participants effected,
in the event that shares adequate to meet the Corporation's
obligations under the Plan are not authorized;
(5) Assure that, in conjunction with the issuance or transfer of any
securities under the Plan, the holder complies with all reporting
and registration requirements imposed under the Securities Act, the
Exchange Act, comparable provisions of applicable state laws, policies
of the Corporation implemented to assure compliance with all such laws
and the regulations and rules promulgated thereunder, or the legally
available exemptions therefrom.
ARTICLE FIVE
ELIGIBILITY
(a)Officers and key employees of the Corporation, or of any Parent or
Subsidiary, who are regularly employed on a salaried basis as common law
employees, and Consultants and directors of the Corporation or of any Parent or
Subsidiary who are not Employees, shall be eligible to participate in this Plan.
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(b)Where appropriate under this Plan, directors who are not Employees shall be
referred to as "employees" and their service as directors as "employment".
ARTICLE SIX
AUTHORITY OF COMMITTEE
(a)This Plan shall be administered by, or under the direction of, the Committee,
which shall administer this 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 shall otherwise have plenary authority
to interpret this Plan and to make all determinations specified in or permitted
by this Plan or deemed necessary or desirable for its administration or for the
conduct of the Committee's business.
(b)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.
(c)Subject to the express provisions of this Plan, the Committee shall have
authority, in its discretion, to determine the persons to whom Plan Awards shall
be granted, the times when such Plan Awards shall be granted, the number of Plan
Awards, the purchase price or exercise price of each Plan Award (if applicable),
the period(s) during which a Plan Award shall be exercisable (whether in whole
or in part), the restrictions to be applicable to Plan Awards and the other
terms and provisions thereof (which need not be identical).
(d)In addition, the authority of the Committee shall include, without
limitation, the following:
(1)Financing.
The arrangement of temporary financing for an Option Holder by registered
broker-dealers, under the rules and regulations of the Federal Reserve Board,
for the purpose of assisting an Option Holder in the exercise of an Option, such
authority to include the payment by the Corporation of the commissions of the
broker-dealer;
(2)Procedures for Exercise of Option.
The establishment of procedures for an Option Holder to:
(A) Exercise an Option by payment of cash;
(B) 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;
(C) 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 Option Holder 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, the effect of which shall be that an Option Holder can
in sequence utilize such newly acquired shares of Common Stock
in payment of the exercise price of the entire Option, together
with such cash as shall be paid in respect of fractional shares;
and
(D) Engage in any form of "cashless" exercise.
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(3)Withholding.
The establishment of a procedure whereby a number of shares of Common Stock
or other securities may be withheld from the total number of shares of Common
Stock or other securities to be issued upon exercise of an Option or for the
tender of shares of Common Stock owned by any Participant to meet any obligation
of withholding for taxes incurred by the Participant upon such exercise.
ARTICLE SEVEN
STOCK OPTIONS
(a)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.
(b)Notwithstanding anything contained herein to the contrary, an Incentive Stock
Option may be granted only to common law employees of the Corporation or of any
Parent or Subsidiary now existing or hereafter formed or acquired, and not to
any director or officer who is not also such a common law employee.
(c)The terms and conditions of the Options shall be determined from time to time
by the Committee; provided, however, that the Options granted under this Plan
shall be subject to the following:
(1) Exercise Price.
(A) 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
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.
(B)The exercise price will be subject to adjustment in accordance with the
provisions of Article Eight of this Plan.
(2) Payment of Exercise Price.
(A)The price per share of Common Stock with respect to each Option shall be
payable at the time the Option is exercised.
(B)Such price shall be payable in cash or pursuant to any of the methods
set forth in Articles Six (d)(2) hereof.
(C)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.
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(3) Exercisability of Options.
(A)Except as provided in Article Seven (c)(1)(5) 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.
(B)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.
(4) Expiration of Options.
No Incentive Stock 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.
(5) Exercise Upon Option Holder's Termination of Employment or Termination
of Consulting Relationship.
(A)If the employment of an Option Holder by the Corporation or by any
Parent or Subsidiary is terminated for any reason other than death, any
Incentive Stock Option granted to such Option Holder may not be exercised later
than three months (one year in the case of termination due to Disability) after
the date of such termination of employment.
(B)For purposes of determining whether any Option Holder has incurred a
termination of employment (or a Termination of Consulting Relationship), an
Option Holder who is both an employee (or a Consultant) and a director of the
Corporation and/or any Parent or Subsidiary shall (with respect to any
Non-Qualified Option that may have been granted to him) be considered to have
incurred a termination of employment (or a Termination of Consulting
Relationship) only upon his termination of service both as an employee (or as a
Consultant) and as a director.
(C)Furthermore, if an Option Holder's employment (or Consulting
Relationship) is terminated by the Corporation or by any Parent or Subsidiary
for Good Cause or if an Option Holder voluntarily terminates his employment
other than for Disability (or incurs a voluntary Termination of Consulting
Relationship other than for Disability) with the Corporation or with any Parent
or Subsidiary without the written consent of the Committee, regardless of
whether such Option Holder continues to serve as a director of the Corporation
or of any Parent or Subsidiary, then the Option Holder shall, at the time of
such termination of employment (or Termination of Consulting Relationship),
forfeit his rights to exercise any and all of the outstanding Option(s)
theretofore granted to him.
(6) Maximum Amount of Incentive Stock Options.
(A)Each Plan Award under which Incentive Stock Options are granted shall
provide that to the extent the aggregate of 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 and the fair market 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 Option Holder by the Corporation or any
Parent or Subsidiary, which are exercisable for the first time by any person
during any calendar year, exceed(s) one hundred thousand dollars ($100,000),
such excess shares of Common Stock shall not be deemed to be purchased pursuant
to Incentive Stock Options.
(B)The terms of the immediately preceding sentence shall be applied by
taking all options, whether or not granted under this Plan, into account in the
order in which they are granted.
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ARTICLE EIGHT
ADJUSTMENT OF SHARES
(a) Recapitalization, etc.
(1)In the event there is any change in the Common Stock of the Corporation
by reason of any reorganization, recapitalization, stock split, stock dividend
or otherwise, they 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 be
entitled, as the case may be, and the per share price thereof also shall be
appropriately adjusted.
(2)Notwithstanding the foregoing:
(A)Each such adjustment with respect to an Incentive Stock Option shall
comply with the rules of Section 424(a) of the Code; and
(B)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.
(1) Upon:
(A)The merger or consolidation of the Corporation with or into another
corporation (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
corporation surviving such merger or consolidation having at least a majority of
the combined voting power of such corporation's then outstanding securities), if
the agreement of merger or consolidation does not provide for the continuance of
the Options, Stock Appreciation Rights and shares of Restricted Stock granted
hereunder or the substitution of new options for Options granted hereunder, or
for the assumption of such Options by the surviving corporation;
(B)The dissolution, liquidation, or sale 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 of assets being referred to as an
"Asset Sale"); or
(C)The Change in Control of the Corporation;
(1) 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) and all restrictions
regarding transferability and forfeiture on shares of Restricted Stock shall be
removed immediately prior to the effective date of such merger, consolidation,
dissolution, liquidation, Asset Sale or Change in Control of the Corporation;
provided that any conditions precedent to the exercise of such Option(s), other
than the passage of time, have occurred.
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(2) The Corporation, to the extent practicable, shall give advance notice
to affected Option Holders of such merger, consolidation, dissolution,
liquidation, Asset Sale or Change in Control of the Corporation.
(3) 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).
(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, directly or indirectly is or becomes the Beneficial Owner (as
defined in Rule 13d-3 promulgated under the Exchange Act), of securities of the
Corporation representing 40% of more of the combined voting power of the
Corporation's then outstanding securities, except:
(1) A trustee or other fiduciary holding securities under an employee
benefit plan of the Corporation or any subsidiary of the Corporation;
(2) A corporation owned, directly or indirectly, by the stockholders of the
Corporation in substantially the same proportions as their ownership of the
Corporation;
(3) The Corporation or any subsidiary of the Corporation; or
(4) A Participant together with all Affiliates and Associates of the
Participant, but only with respect to the Option(s) held by the Participant who,
together with his Affiliates or Associates, if any, is or becomes the direct or
indirect Beneficial Owner of the percentage of such securities.
ARTICLE NINE
MISCELLANEOUS PROVISIONS
(a)Administrative Procedures.
The Committee may establish any procedures determined by it to be
appropriate in discharging its responsibilities under this Plan. All actions and
decisions of the Committee shall be final.
(b)Assignment or Transfer.
(1) No grant or award of any Plan Award (other than a Non-Qualified Option)
or any rights or interests therein shall be assignable or transferable by a
Participant except by will or the laws of descent and distribution or pursuant
to a domestic relations order.
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(2)During the lifetime of a Participant, Incentive Stock Options granted
hereunder shall be exercisable only by the Participant.
(c)Investment Representation.
In the case of Plan Awards paid in shares of Common Stock or other
securities, or, 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 Participant 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 and any applicable provisions of
state laws, to deliver such securities in compliance with the provisions of the
Securities Act and any applicable provisions of state laws, or of the provisions
of any exemptions from such requirements.
(d)Withholding Taxes.
(1)The Corporation shall have the right to deduct from all cash payments
owed to a Participant for any reason, any federal, state, local or foreign taxes
required by law to be withheld with respect to any Plan Awards.
(2)In the case of the issuance or distribution of Common Stock or other
securities hereunder, either directly or upon the exercise of or payment upon
any Plan Award, the Corporation, as a condition of such issuance or
distribution, may require the payment (through withholding from the
Participant's salary, reduction of the number of shares of Common Stock or other
securities to be issued, or otherwise) of any such taxes.
(3)Each Participant may satisfy the withholding obligations by paying to
the Corporation a cash amount equal to the amount required to be withheld or by
tendering to the Corporation a number of shares of Common Stock having a value
equivalent to such cash amount, or by use of any available procedure as
described under Article Six (d)(3) hereof.
(e)Costs and Expenses.
The costs and expenses of administering this Plan shall be borne by the
Corporation and shall not be charged against any award nor to any employee
receiving a Plan Award.
(f)Funding of Plan.
(1)This Plan shall be unfunded.
(2)The Corporation shall not be required to segregate any of its assets to
assure the payment of any Plan Award under this Plan.
(3)Neither the Participants 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 Plan Award, except to the extent expressly provided
hereunder.
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(4)The interests of each Participant and former Participant hereunder are
unsecured and shall be subject to the general creditors of the Corporation.
(g)Other Incentive Plans.
The adoption of this Plan does not preclude the adoption by appropriate
means of any other incentive plan for employees, or the grant of any benefits or
compensation, including, without limitation, securities of the Corporation,
under any employment, consulting or acquisition agreements.
(h)Plurals and Gender.
Where appearing in this Plan, 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 this 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 this Plan shall be held illegal or void, such
illegality or invalidity shall not affect the remaining provisions of this Plan,
but shall be fully severable, and this Plan shall be construed and enforced as
if said illegal or invalid provisions had never been inserted herein.
(k)Payments Due Missing Persons.
(1)The Corporation shall make a reasonable effort to locate all persons
entitled to benefits under this Plan; however, notwithstanding any provisions of
this Plan to the contrary, if, after a period of one year from the date such
benefits shall be due, any such persons entitled to benefits have not been
located, their rights under this Plan shall stand suspended.
(2)Before this provision becomes operative, the Corporation shall send a
certified letter to all such persons at their last known addresses advising them
that their rights under this Plan shall be suspended.
(3)Subject to all applicable state escheat laws, any such suspended amounts
shall be held by the Corporation for a period of one additional year and
thereafter such amounts shall be forfeited and thereafter remain the property of
the Corporation.
(l)Liability and Indemnification.
(1) (A) 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 this Plan.
(B) 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.
(2) (A) Except for their own gross negligence or willful misconduct
regarding the performance of the duties specifically assigned to them
under, or their willful breach of the terms of, this Plan, the Corporation,
each Parent and Subsidiary and the Committee shall be held harmless by the
Participants, former Participants, beneficiaries and their representatives
against liability or losses occurring by reason of any act or omission.
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(B) Neither the Corporation, any Parent or Subsidiary, the Committee,
nor any agents, employees, officers, directors or shareholders of any of
them, nor any other person shall have any liability or responsibility with
respect to this Plan, except as expressly provided herein.
(m) Incapacity.
If the Committee shall receive evidence satisfactory to it that a person
entitled to receive payment of any Plan Award is, at the time when such benefit
becomes payable, a minor, or is physically or mentally incompetent to receive
such Plan Award 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 make payment of such Plan Award
otherwise payable to such person to 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 payment of such Plan Award.
(n)Cooperation of Parties.
All parties to this 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 this Plan or any of its
provisions.
(o)Governing Law.
All questions pertaining to the validity, construction and administration
of this Plan shall be determined in accordance with the laws of the State of
Delaware, exclusive of any choice of law provisions thereof which would result
in the application of substantive laws other than those of the State of
Delaware.
(p)Non-guarantee of Employment or Consulting Relationship.
Nothing contained in this Plan shall be construed as a contract of
employment (or as a consulting contract) between the Corporation (or any Parent
or Subsidiary), and any employee or Participant, as a right of any employee or
Participant to be continued in the employment of (or in a Consulting
Relationship 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 its employees (or Consultants), at any time, with or without
cause.
(q)Notices.
(1)Each notice relating to this Plan shall be in writing and delivered
in person or by certified mail to the proper address. All notices to the
Corporation or the Committee shall be addressed to it at the Corporation's
address last set forth in a document filed by the Corporation with the
Commission and posted on the Commission's Internet web site at www.sec.gov,
in conjunction with the Commission's current electronic data gathering and
retrieval system ("EDGAR"), or any successors thereto.
(2)All notices to Participants, former Participants, 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.
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(R)Written Agreements.
Each Plan Award shall be evidenced by a signed written agreement (the
"Award Agreements") between the Corporation and the Participant containing the
terms and conditions of the award.
ARTICLE TEN
AMENDMENT OR TERMINATION OF PLAN
(a)The Board of Directors of the Corporation shall have the right to amend,
suspend or terminate this Plan at any time, provided that no amendment shall be
made which shall increase the total number of shares of the Common Stock of the
Corporation which may be issued and sold pursuant to Incentive Stock Options,
reduce the minimum exercise price in the case of an Incentive Stock Option or
modify the provisions of this Plan relating to eligibility with respect to
Incentive Stock Options unless such amendment is made by or with the approval of
the stockholders within 12 months of the effective date of such amendment, but
only if such approval is required by any applicable provision of law.
(b)The Board of Directors of the Corporation shall also be authorized to amend
this Plan and the Options granted thereunder to maintain qualification as
"incentive stock options" within the meaning of Section 422 of the Code, if
applicable.
(c)Except as otherwise provided herein, no amendment, suspension or termination
of this Plan shall alter or impair any Plan Awards previously granted under this
Plan without the consent of the holder thereof, except as required to comply
with applicable conditions or requirements of the Code, the Securities Act, the
Exchange Act or any other applicable law of the United States, or of any states
in which a Participant is domiciled or under which the Corporation is subject to
in personam jurisdiction and regulation.
(d)This Plan shall automatically terminate on the day immediately preceding the
tenth anniversary of the date this Plan was adopted by the Board of Directors of
the Corporation, unless sooner terminated by such Board of Directors.
(e)No Plan Awards may be granted under this Plan subsequent to the termination
of this Plan.
In Witness Whereof, pursuant to a duly adopted resolution of the
Corporation's Board of Directors, currently in effect, the undersigned have
executed this Indenture, by and on behalf of the Corporation.
AmeriNet Group.com, Inc.
Dated:August ___, 1999
By:_____________________
Michael Harris Jordan
President
{Corporate Seal}
Attest: ______________________
G. Richard Chamberlin, Esquire
Secretary & General Counsel
Before me, an officer duly authorized to administer oaths by the State of
Florida, did personally appear Michael Harris Jordan and G. Richard Chamberlin,
known to me, who being duly sworn, did certify to me, in my presence, that they
executed this Indenture, in the capacities indicated, on the date set forth
above, as the act of AmeriNet Group.com, Inc., a publicly held Delaware
corporation with a class of securities registered under Section 12(g) of the
Securities Exchange Act of 1934, as amended (the "Corporation"), pursuant to
authority of a duly promulgated and currently effective resolution of its duly
elected and serving Board of Directors, and that by such action, the Corporation
has become bound by the terms thereof.
Witness my hand and seal, this ___ day of August, 1999. My commission
expires:
{Notarial Seal}
----------------------
Vanessa H. Mitchem
Notary Public
25
Employment Agreement
This Employment Agreement (the "Agreement") is entered into by and among
Michael Harris Jordan, an individual residing in the State of Florida ("Mr.
Jordan"); AmeriNet Group.com, Inc., a Delaware publicly held corporation with a
class of securities registered under Section 12(g) of the Securities Exchange
Act of 1934, as amended ("AmeriNet" and the "Exchange Act," respectively,
AmeriNet and all of its subsidiaries, whether current or subsequently formed or
acquired, being collectively hereinafter referred to as the "Consolidated
Corporation," and AmeriNet and Mr. Jordan being sometimes hereinafter
collectively to as the "Parties" or generically as a "Party".
Preamble:
WHEREAS, Charles J. Scimeca, AmeriNet's president has advised its board of
directors that in light of its currently increased activities in the public
sector, AmeriNet should consider retaining a president more experienced in
matters involving the securities industry, public finance and securities
regulatory requirements; and
WHEREAS, AmeriNet has directed the Yankee Companies, Inc., a Florida
corporation which serves as AmeriNet's strategic consultant ("Yankees") to
recommend and individual meeting the parameters established by Mr. Scimeca, to
serve as its president for the next fiscal year; and
WHEREAS, Yankees has conducted an executive recruitment search and
recommended Mr. Jordan to AmeriNet's board of directors based on the expectation
that during the next twelve months AmeriNet's development as a diversified
Internet group of companies will require substantial additional capital and
consequently, a president familiar with the investment community and the
practical and regulatory aspects of capital formation; and
WHEREAS, after interviewing Mr. Jordan, AmeriNet's board of directors has
determined that he is experienced and well known in the financial community and
is thoroughly knowledgeable with the obligations and restriction imposed on
public companies by the Exchange Act and the Securities Act of 1933, as amended
(the "Securities Act") and has requested that he serve as AmeriNet's president
during the next fiscal year; and
WHEREAS, Mr. Jordan is agreeable to serving as AmeriNet's president on the
terms and conditions hereinafter set forth:
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements hereby exchanged, as well as of the sum of Ten ($10.00) Dollars and
other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, the Parties, intending to be legally bound, hereby agree as
follows:
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Witnesseth:
Article One
Term, Renewals, Earlier Termination
1.1 Term.
Subject to the provisions set forth herein, the term of Mr. Jordan's
employment hereunder shall be deemed to commence on first business day of the
first week following the last date appearing on the signature page of this
Agreement and continue until August 30, 2000, unless extended or earlier
terminated by AmeriNet as hereinafter set forth.
1.2 Renewals.
This Agreement shall be renewed automatically, after expiration of the
original term, on a continuing annual basis, unless the Party wishing not to
renew this Agreement provides the other Party with written notice of its
election not to renew ("Termination Election Notice") on or before the 60th day
prior to termination of the then current term.
1.3 Earlier Termination.
AmeriNet shall have the right to terminate this Agreement prior to the
expiration of its Term or of any renewals thereof, subject to the provisions of
Section 1.4, for the following reasons:
(a) For Cause:
(1)AmeriNet may terminate the President's employment under this
Agreement at any time for cause.
(2)Such termination shall be evidenced by written notice thereof to
Mr. Jordan, which notice shall specify the cause for termination.
(3)For purposes hereof, the term "cause" shall mean:
(a)The inability of Mr. Jordan, through sickness or other incapacity,
to discharge his duties under this Agreement for 21 or more consecutive
days or for a total of 45 or more days in a period of twelve consecutive
months;
(b)The refusal of Mr. Jordan to follow the directions of AmeriNet's
board of directors;
(c)Dishonesty; theft; or conviction of a crime involving moral
turpitude;
(d)Material default in the performance of his obligations, services or
duties required under this Agreement or materially breach of any provision
of this Agreement, which default or breach has continued for five days
after written notice of such default or breach.
(b) Discontinuance of Business:
In the event that AmeriNet discontinues operating its business, this
Agreement shall terminate as of the last day of the month on which it
ceases operation with the same force and effect as if such last day of the
month were originally set as the termination date hereof; provided,
however, that a reorganization of AmeriNet shall not be deemed a
termination of its business.
(c) Death:
This Agreement shall terminate immediately on Mr. Jordan's death;
however, all accrued compensation at such time shall be promptly paid to
Mr. Jordan's estate.
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1.4 Final Settlement.
Upon termination of this Agreement and payment to Mr. Jordan of all amounts
due him hereunder, Mr. Jordan or his representative shall execute and deliver to
the terminating entity on a form prepared by the terminating entity, a receipt
for such sums and a release of all claims, except such claims as may have been
submitted pursuant to the terms of this Agreement and which remain unpaid, and,
shall forthwith tender to AmeriNet all records, manuals and written procedures,
as may be desired by it for the continued conduct of its business.
Article Two
Scope of Employment
2.1 Retention.
AmeriNet hereby hires Mr. Jordan and Mr. Jordan hereby accepts such
employment, in accordance with the terms, provisions and conditions of this
Agreement.
2.2 General Description of Duties.
(a) Mr. Jordan shall be employed as the president of AmeriNet and
shall perform the duties associated with the position of president by
AmeriNet's bylaws.
(b) Without limiting the generality of the foregoing, Mr. Jordan
shall:
(1) Serve as the principal point of contact between AmeriNet
and:
(A)The media (print, electronic, voice and picture);
(B)The investment community;
(C)AmeriNet's security holders;
(2) Be responsible for supervision of all of AmeriNet's other
officers;
(3) Be responsible for AmeriNet's compliance with all
applicable laws, including federal, state and local
securities laws and tax laws;
(4) Be responsible for supervision of AmeriNet's
subsidiaries; and
(5) Perform such other duties as are assigned to him by
AmeriNet's board of directors, subject to compliance with all
applicable laws and fiduciary obligations.
(c) Mr. Jordan covenants and agrees to perform his employment duties
in good faith and, subject to the exceptions specified in Section 2.4, to
devote substantially all of his business time, energies and abilities to
the proper and efficient management and execution of such duties. 2.3
Status.
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2.3 Status
(a)Mr. Jordan shall serve as an employee of AmeriNet but shall have no
authority to act as an agent thereof, or to bind AmeriNet or its
subsidiaries as a principal or agent thereof, all such functions being
reserved to its board of directors in compliance with the requirements of
its constituent documents.
(b)Mr. Jordan hereby covenants and agrees that he shall not hold
himself out as an authorized agent of AmeriNet unless such authority is
specifically assigned to him, on a case by case basis, by its board of
directors pursuant to a duly adopted resolution which remains in effect.
(c)Mr. Jordan hereby represents and warrants to AmeriNet that he is
subject to no legal, self regulatory organization (e.g., National
Association of Securities Dealers, Inc.'s bylaws) or regulatory impediments
to the provision of the services called for by this Agreement, or to
receipt of the compensation called for under this Agreement or any
supplements thereto; and, Mr. Jordan hereby irrevocably covenants and
agrees to immediately bring to the attention of AmeriNet any facts required
to make the foregoing representation and warranty continuingly accurate
throughout the term of this Agreement, or any supplements or extensions
thereof.
(d)Annexed hereto and made a part hereof as exhibit 2.3(d) is a letter
from Sunshine Securities Corporation, an NASD member firm, consenting to
Mr. Jordan's entry into this agreement.
2.4 Exclusivity.
Mr. Jordan shall, unless specifically otherwise authorized by AmeriNet's
board of directors, on a case by case basis, devote his business time
exclusively to the affairs of AmeriNet; provided, however, that AmeriNet hereby
recognizes that Mr. Jordan is:
(a)A party to an agreement with the Southeast Companies, Inc., which
has been assigned thereby to Yankees, calling for him to provide services
thereto;
(b)The president of Southeast Counseling & Management, a division of
the Southeast Companies, Inc.
(c)The president of Securities Counseling & Management, Inc., a
Florida corporation;
(d)An officer of Zagreus, Inc., a currently inactive public company in
the process of reorganization; and
(e)A registered representative and registered principal with Sunshine
Securities Corporation; and hereby consents to his continuation in such
roles, provided that his role as AmeriNet's president shall take priority
in allocation of time and resources to any activities pertaining to such
roles, and that he will resolve any actual conflicts of interest resulting
from such roles in favor of AmeriNet.
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2.5 Limitations on Services
(a)The Parties recognize that certain responsibilities and obligations
are imposed by federal and state securities laws and by the applicable
rules and regulations of stock exchanges, the National Association of
Securities Dealers, Inc., in-house "due diligence" or "compliance"
departments of Licensed Securities Firms, etc.; accordingly, Mr. Jordan
agrees that he will not:
(1)Release any financial or other material information or data
about AmeriNet without the prior written consent and approval of
AmeriNet's General Counsel;
(2)Conduct any meetings with financial analysts without informing
AmeriNet's General Counsel and board of directors in advance of the
proposed meeting and the format or agenda of such meeting.
(b)In any circumstances where Mr. Jordan is describing the securities
of AmeriNet to a third party, Mr. Jordan shall disclose to such person any
compensation received from AmeriNet to the extent required under any
applicable laws, including, without limitation, Section 17(b) of the
Securities Act of 1933, as amended.
(c)In rendering his services, Mr. Jordan shall not disclose to any
third party any confidential non-public information furnished by AmeriNet
or American Internet or otherwise obtained by it with respect to AmeriNet,
except on a need to know basis, and in such case, subject to appropriate
assurances that such information shall not be used, directly or indirectly,
in any manner that would violate state or federal prohibitions on insider
trading of AmeriNet's securities.
(d)Mr. Jordan shall not take any action which would in any way
adversely affect the reputation, standing or prospects of AmeriNet or
AmeriNet or which would cause AmeriNet to be in violation of applicable
laws.
Article Three
Compensation
3.1 Compensation.
As consideration for Mr. Jordan's services to AmeriNet Mr. Jordan shall
be entitled to:
(a) (1)An option to purchase up to 100,000 shares of AmeriNet's common
stock during the 36 month period commencing at the end of the 365th day
following commencement of the initial term of this Agreement, at an
exercise price equal to the last reported price paid therefor reported on
the over the counter electronic bulletin board operated by the National
Association of Securities Dealers, Inc., a Delaware corporation and self
regulatory organization registered with the Commission under the Exchange
Act (the "OTC Bulletin Board" and the "NASD," respectively), provided that:
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(a)He remains in the employ of AmeriNet for a period of not less
than 365 consecutive days;
(b)He has not been discharged by AmeriNet for cause;
(c)He fully complies with the provisions of this Agreement,
including, without limitation, the confidentiality and non-competition
sections hereof;
(2)Mr. Jordan hereby represents, warrants, covenants and acknowledges
that:
(A)The securities being issued as compensation under this
Agreement (the "Securities") will be issued without registration under
the provisions of Section 5 of the Securities Act or the securities
regulatory laws and regulations of the State of Florida (the "Florida
Act") pursuant to exemptions provided pursuant to Section 4(6) of the
Act and comparable provisions of the Florida Act;
(B)Mr. Jordan shall be responsible for preparing and filing any
reports concerning this transaction with the Commission and with
Florida Division of Securities, and payment of any required filing
fees (none being expected);
(C)All of the Securities will bear legends restricting their
transfer, sale, conveyance or hypothecation unless such Securities are
either registered under the provisions of Section 5 of the Act and
under the Florida Act, or an opinion of legal counsel, in form and
substance satisfactory to legal counsel to AmeriNet is provided to
AmeriNet's General Counsel to the effect that such registration is not
required as a result of applicable exemptions therefrom;
(D)AmeriNet's transfer agent shall be instructed not to transfer
any of the Securities unless the General Counsel for AmeriNet advises
it that such transfer is in compliance with all applicable laws;
(E)Mr. Jordan is acquiring the Securities for his own account,
for investment purposes only, and not with a view to further sale or
distribution; and
(F)Mr. Jordan or his advisors have examined AmeriNet's books and
records and questioned its officers and directors as to such matters
involving AmeriNet as he deemed appropriate.
(3)In the event that AmeriNet files a registration or notification
statement with the Commission or any state securities regulatory
authorities registering or qualifying any of its securities for sale or
resale to the public as free trading securities, it will notify Mr. Jordan
of such intent at least 15 business days prior to such filing, and shall,
if requested by him, include any shares theretofore issued upon exercise of
the Options in such registration or notification statement, provided that
Mr. Jordan cooperates in a timely manner with any requirements for such
registration or qualification by notification, including, without
limitation, the obligation to provide complete and accurate information
therefor.
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(b)In addition to the compensation described above:
(1)In the event that Mr. Jordan arranges or provides funding for the
Consolidated Corporation on terms more beneficial than those reflected in
the Consolidated Corporation's current principal financing agreements,
copies of which are included among the Consolidated Corporation's records
available through the SEC's EDGAR web site, Mr. Jordan shall be entitled,
at its election, to either:
(A)A fee equal to 5% of such savings, on a continuing basis; or
(B)If equity funding is provided through Mr. Jordan or any
affiliates thereof, a discount of 5% from the bid price for the
subject equity securities, if they are issuable as free trading
securities, or, a discount of 25% from the bid price for the subject
equity securities, if they are issuable as restricted securities (as
the term restricted is used for purposes of SEC Rule 144); and
(C)If equity funding is arranged for the Consolidated Corporation
by Mr. Jordan and AmeriNet is not obligated to pay any other source
compensation in conjunction therewith, other than the normal
commissions charged by broker dealers in securities in compliance with
the compensation guidelines of the NASD, the Mr. Jordan shall be
entitled to a bonus in a sum equal to 5% of the net proceeds of such
funding.
(2)In the event that Mr. Jordan generates business for the
Consolidated Corporation, then, on any sales resulting therefrom, Mr.
Jordan shall be entitled to a commission equal to 5% of the net income
derived by the Consolidated Corporation therefrom, on a continuing basis.
3.2 Benefits
Mr. Jordan shall be entitled to any benefits generally made available to
all other employees (rather than to a specified employee or group of
employees).
3.3 Indemnification.
AmeriNet will defend, indemnify and hold Mr. Jordan harmless from all
liabilities, suits, judgments, fines, penalties or disabilities, including
expenses associated directly, therewith (e.g. legal fees, court costs,
investigative costs, witness fees, etc.) resulting from any reasonable actions
taken by him in good faith on behalf of the Consolidated Corporation, its
affiliates or for other persons or entities at the request of the board of
directors of AmeriNet, to the fullest extent legally permitted, and in
conjunction therewith, shall assure that all required expenditures are made in a
manner making it unnecessary for Mr. Jordan to incur any out of pocket expenses;
provided, however, that Mr. Jordan permits AmeriNet to select and supervise all
personnel involved in such defense and that Mr. Jordan waives any conflicts of
interest that such personnel may have as a result of also representing AmeriNet,
their stockholders or other personnel and agrees to hold them harmless from any
matters involving such representation, except such as involve fraud or bad
faith.
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Article Four
Special Covenants
4.1 Confidentiality.
(a)Mr. Jordan acknowledges that, in and as a result of his employment
hereunder, he will be developing for AmeriNet, making use of, acquiring
and/or adding to, confidential information of special and unique nature and
value relating to such matters as AmeriNet's trade secrets, systems,
procedures, manuals, confidential reports, personnel resources, strategic
and tactical plans, advisors, clients, investors and funders; consequently,
as material inducement to the entry into this Agreement by AmeriNet, Mr.
Jordan hereby covenants and agrees that he shall not, at anytime during or
following the terms of his employment hereunder, directly or indirectly,
personally use, divulge or disclose, for any purpose whatsoever, any of
such confidential information which has been obtained by or disclosed to
him as a result of his employment by AmeriNet, or AmeriNet's affiliates.
(b)In the event of a breach or threatened breach by Mr. Jordan of any
of the provisions of this Section 4.1, AmeriNet, in addition to and not in
limitation of any other rights, remedies or damages available to AmeriNet,
whether at law or in equity, shall be entitled to a permanent injunction in
order to prevent or to restrain any such breach by Mr. Jordan, or by Mr.
Jordan's partners, agents, representatives, servants, employers, employees,
affiliates and/or any and all persons directly or indirectly acting for or
with him.
4.2 Special Remedies.
In view of the irreparable harm and damage which would undoubtedly occur to
AmeriNet as a result of a breach by Mr. Jordan of the covenants or agreements
contained in this Article Four, and in view of the lack of an adequate remedy at
law to protect AmeriNet's interests, Mr. Jordan hereby covenants and agrees that
AmeriNet shall have the following additional rights and remedies in the event of
a breach hereof:
(a)Mr. Jordan hereby consents to the issuance of a permanent
injunction enjoining him from any violations of the covenants set forth in
Section 4.1 hereof; and
(b)Because it is impossible to ascertain or estimate the entire or
exact cost, damage or injury which AmeriNet may sustain prior to the
effective enforcement of such injunction, Mr. Jordan hereby covenants and
agrees to pay over to AmeriNet, in the event he violates the covenants and
agreements contained in Section 4.2 hereof, the greater of:
(i)Any payment or compensation of any kind received by him
because of such violation before the issuance of such injunction, or
(ii)The sum of One Thousand ($1,000.00) Dollars per violation,
which sum shall be liquidated damages, and not a penalty, for the
injuries suffered by AmeriNet as a result of such violation, the
Parties hereto agreeing that such liquidated damages are not intended
as the exclusive remedy available to AmeriNet for any breach of the
covenants and agreements contained in this Article Four, prior to the
issuance of such injunction, the Parties recognizing that the only
adequate remedy to protect AmeriNet from the injury caused by such
breaches would be injunctive relief.
4.3 Cumulative Remedies.
Mr. Jordan hereby irrevocably agrees that the remedies described in Section
4.3 hereof shall be in addition to, and not in limitation of, any of the rights
or remedies to which AmeriNet is or may be entitled to, whether at law or in
equity, under or pursuant to this Agreement.
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<PAGE>
4.4 Acknowledgment of Reasonableness.
Mr. Jordan hereby represents, warrants and acknowledges that he has
carefully read and considered the provisions of this Article Four and, having
done so, agrees that the restrictions set forth herein are fair and reasonable
and are reasonably required for the protection of the interests of AmeriNet, its
officers, directors and other employees; consequently, in the event that any of
the above-described restrictions shall be held unenforceable by any court of
competent jurisdiction, Mr. Jordan hereby covenants, agrees and directs such
court to substitute a reasonable judicially enforceable limitation in place of
any limitation deemed unenforceable and, Mr. Jordan hereby covenants and agrees
that if so modified, the covenants contained in this Article Four shall be as
fully enforceable as if they had been set forth herein directly by the Parties.
In determining the nature of this limitation, Mr. Jordan hereby acknowledges,
covenants and agrees that it is the intent of the Parties that a court
adjudicating a dispute arising hereunder recognize that the Parties desire that
this covenant not to compete be imposed and maintained to the greatest extent
possible.
4.5 Unauthorized Acts.
Mr. Jordan hereby covenants and agrees that he will not do any act or incur
any obligation on behalf of AmeriNet or American Internet of any kind
whatsoever, except as authorized by its board of directors or by its
stockholders pursuant to duly adopted stockholder action.
4.6Covenant not to Disparage
Mr. Jordan hereby irrevocably covenants and agrees that during the term of
this Agreement and after its termination, he will refrain from making any
remarks that could be construed by anyone, under any circumstances, as
disparaging, directly or indirectly, specifically, through innuendo or by
inference, whether or not true, about the Consolidated Company, its constituent
members, or their officers, directors, stockholders, employees, agent or
affiliates, whether related to the business of the Consolidated Company, to
other business or financial matters or to personal matters.
Article Five
Miscellaneous
5.1 Notices.
(a)All notices, demands or other communications hereunder shall
be in writing, and unless otherwise provided, shall be deemed to have
been duly given on the first business day after mailing by registered
or certified mail, return receipt requested, postage prepaid,
addressed as follows:
To Mr. Jordan:
Michael Harris Jordan: 21131 Northeast 24th Court; Miami, Florida 33180;
Telephone (305) 932-0245; Facsimile (305) 932-0645; e-mail
[email protected]
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To AmeriNet:
AmeriNet Group.com, Inc.
902 Clint Moore Road, Suite 136; Boca Raton, Florida 33487 Telephone (561)
998-2025, Fax (561) 998-3425; and, e-mail [email protected]; Attention:
Senior Vice President; with a copy to
G. Richard Chamberlin, Esquire; General Counsel
AmeriNet Group.com, Inc.
14950 South Highway 441; Summerfield, Florida 34491
Telephone (352) 694-6714, Fax (352) 694-9178; and, e-mail, [email protected];
and to
The Yankee Companies, Inc.
902 Clint Moore Road, Suite 136; Boca Raton, Florida 33487
Telephone (561) 998-2025, Fax (561) 998-3425; and, e-mail
[email protected];
Attention: Leonard Miles Tucker, President
or such other address or to such other person as any Party shall designate to
the other for such purpose in the manner hereinafter set forth.
(b)(1)The Parties acknowledge that Yankees serves as a strategic
consultant to AmeriNet and has acted as scrivener for the Parties in
this transaction but that Yankees is neither a law firm nor an agency
subject to any professional regulation or oversight.
(2)Because of the inherent conflict of interests involved,
Yankees has advised all of the Parties to retain independent
legal and accounting counsel to review this Agreement and its
exhibits and incorporated materials on their behalf.
(c)The decision by any Party not to use the services of legal
counsel in conjunction with this transaction shall be solely at their
own risk, each Party acknowledging that applicable rules of the
Florida Bar prevent AmeriNet's general counsel, who has reviewed,
approved and caused modifications on behalf of AmeriNet, from
representing anyone other than AmeriNet in this transaction.
5.2 Amendment.
(a)No modification, waiver, amendment, discharge or change of
this Agreement shall be valid unless the same is in writing and signed
by the Party against which the enforcement of said modification,
waiver, amendment, discharge or change is sought.
(b)This Agreement may not be modified without the consent of a
majority in interest of AmeriNet's stockholders.
5.3 Merger.
(a)This instrument contains all of the understandings and
agreements of the Parties with respect to the subject matter discussed
herein.
(b)All prior agreements whether written or oral, are merged
herein and shall be of no force or effect.
5.4 Survival.
The several representations, warranties and covenants of the Parties
contained herein shall survive the execution hereof and shall be effective
regardless of any investigation that may have been made or may be made by or on
behalf of any Party.
5.5 Severability.
If any provision or any portion of any provision of this Agreement, or the
application of such provision or any portion thereof to any person or
circumstance shall be held invalid or unenforceable, the remaining portions of
such provision and the remaining provisions of this Agreement or the application
of such provision or portion of such provision as is held invalid or
unenforceable to persons or circumstances other than those to which it is held
invalid or unenforceable, shall not be effected thereby.
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<PAGE>
5.6 Governing Law and Venue.
This Agreement shall be construed in accordance with the laws of the State
of Florida but any proceeding arising between the Parties in any matter
pertaining or related to this Agreement shall, to the extent permitted by law,
be held in Broward County, Florida.
5.7 Litigation.
(a)In any action between the Parties to enforce any of the terms of this
Agreement or any other matter arising from this Agreement, the prevailing Party
shall be entitled to recover its costs and expenses, including reasonable
attorneys' fees up to and including all negotiations, trials and appeals,
whether or not litigation is initiated.
(b)In the event of any dispute arising under this Agreement, or the
negotiation thereof or inducements to enter into the Agreement, the dispute
shall, at the request of any Party, be exclusively resolved through the
following procedures:
(1)(A)First, the issue shall be submitted to mediation before a
mediation service in Broward County, Florida, to be selected by lot
from six alternatives to be provided, three by AmeriNet and three by
Mr. Jordan.
(B)The mediation efforts shall be concluded within ten business
days after their initiation unless the Parties unanimously agree to an
extended mediation period;
(2)In the event that mediation does not lead to a resolution of
the dispute then at the request of any Party, the Parties shall submit
the dispute to binding arbitration before an arbitration service
located in Broward County, Florida to be selected by lot, from six
alternatives to be provided, three by AmeriNet and three by Mr.
Jordan.
(3)(A)Expenses of mediation shall be borne by AmeriNet, if
successful.
(B)Expenses of mediation, if unsuccessful and of arbitration
shall be borne by the Party or Parties against whom the arbitration
decision is rendered.
(C)If the terms of the arbitral award do not establish a
prevailing Party, then the expenses of unsuccessful mediation and
arbitration shall be borne equally by the Parties.
5.8 Benefit of Agreement.
(a)This Agreement may not be assigned by Mr. Jordan without the
prior written consent of AmeriNet.
(b)Subject to the restrictions on transferability and assignment
contained herein, the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of the Parties, their
successors, assigns, personal representative, estate, heirs and
legatees.
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5.9 Captions.
The captions in this Agreement are for convenience and reference only and
in no way define, describe, extend or limit the scope of this Agreement or the
intent of any provisions hereof.
5.10 Number and Gender.
All pronouns and any variations thereof shall be deemed to refer to the
masculine, feminine, neuter, singular or plural, as the identity of the Party or
Parties, or their personal representatives, successors and assigns may require.
5.11 Further Assurances.
The Parties hereby agree to do, execute, acknowledge and deliver or cause
to be done, executed or acknowledged or delivered and to perform all such acts
and deliver all such deeds, assignments, transfers, conveyances, powers of
attorney, assurances, recipes, records and other documents, as may, from time to
time, be required herein to effect the intent and purposes of this Agreement.
5.12 Status.
Nothing in this Agreement shall be construed or shall constitute a
partnership, joint venture, agency, or lessor-lessee relationship; but, rather,
the relationship established hereby is that of employer-employee in AmeriNet.
5.13 Counterparts.
(a) This Agreement may be executed in any number of counterparts.
(b)Execution by exchange of facsimile transmission shall be
deemed legally sufficient to bind the signatory; however, the Parties
shall, for aesthetic purposes, prepare a fully executed original
version of this Agreement, which shall be the document filed with the
Securities and Exchange Commission.
5.14 License.
(a)This Agreement is the property of Yankees and the use hereof
by the Parties is authorized hereby solely for purposes of this
transaction.
(b)The use of this form of agreement or of any derivation thereof
without Yankees' prior written permission is prohibited.
(c)This Agreement shall not be more strictly interpreted against
any Party as a result of its authorship.
In Witness Whereof, the Parties have executed this Agreement, effective as
of the last date set forth below.
Signed, Sealed & Delivered
In Our Presence
Mr. Jordan
- --------------------------
- --------------------------
---------------------------
Michael Harris Jordan
Dated:August ___, 1999
AmeriNet Group.com, Inc.
a Delaware corporation
- --------------------------
__________________________ By: ___________________________
Anthony Q. Joffe
Director Specifically authorized
to act as the agent of AmeriNet for
purposes of executing this Agreement
(CORPORATE SEAL)
Attest:________________________
G. Richard Chamberlin, Esquire
General Counsel & Secretary
Dated:August ___, 1999
37
Chamberlin Law Office, P.A.
G. Richard Chamberlin, attorney*
Florida & Georgia Bars only
Ocala Office:
1941 Southeast 51st Terrace
Ocala, Florida 34471
352-694-6714 (voice)
352-694-9178 (fax)
Mail to:
1941 Southeast 51st Terrace
Ocala, Florida 34471
DIRECTOR/OFFICER QUESTIONNAIRE
(Please Print or Type Responses)
TO: Michael H. Jordan
FROM: Vanessa Lindsey
DATE: August 2, 1999
SUBJECT: Due Diligence Disclosures for AmeriNet Group.com, Inc.
Dear Mr. Jordan:
Please provide us with the following information, as soon as possible.
1. Name: Michael H. Jordan
2. (a) Home Address: 21131 NE 24 CT
Miami, Florida 33180
(b) Business Address: same as above
3. (a) Home Phone: 305-933-3183
(b) Business Phone: 305-932-0245
4. Age: 46
5. State positions and offices held or to be held with the juridical entity or
entities disclosed above (each being hereinafter generically referred to as the
"Juridical Entity"), and your term of office for each: * Sunshine
Securities-Series #7 and 24
Zagreus, Inc. formerly Americare Health Group, Inc. as Secretary/Treasurer
and Securities Counseling and Management, Inc. as President
6. State periods during which you have served in such position(s) and
office(s):
January 1996- Present
Since Inception in 1992
7. Is there any arrangement or understanding between you and any other person
pursuant to which you were or will be selected as a director or nominee? yes
____ no X (If "yes," briefly describe such arrangement or understanding, and
name such person. Do not include arrangements with directors and officers acting
solely in their capacities as such.)
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8. State the nature of any family relationship ( by blood, marriage, or
adoption, not more remote than first cousin) between yourself and any
director, executive officer, or person nominated or chosen by the Juridical
Entity to become a director or executive officer.
Not Applicable
9. List all places of employment, their principal business, and your principal
occupation(s) during the last five years, staring with your current positions
and working back in time. Include all positions as an officer, director,
partner, consultant or sole proprietor:
Principal
Dates Location Name of Business Principal Purpose
Occupation
See Number 5
10. State whether any of the businesses listed are parents, subsidiaries, or
affiliates of the Juridical Entity.
Not Applicable
11. State, in detail, the nature of responsibility undertaken by you in the
prior positions listed above. (Answer should include specific principal duties
which relate to the level of your professional competence.)
12. Have you ever held a directorship in any company with a class of securities
registered pursuant to Section 12 of the Securities Exchange Act of 1934 or
subject to the reporting requirements of Section 15(d) of such Act, or of any
company registered as an investment company under the Investment Company Act of
1940? yes ____ no X (if "yes" list all such companies below):
13. During the past five years, has a petition under the federal bankruptcy laws
or under any state insolvency law been filed by or against you, or any
partnership in which you were a general partner within two years before such
filing, or any corporation or business association of which you were an
executive officer within two years before such filing? yes ______ no X. If yes,
please provide specific details and, under separate cover, please provide copies
of any pleadings, orders or judgments associated therewith:
14. During the past five years, has a receiver, fiscal agent, or similar officer
been appointed by a court for your business or property, or any partnership in
which you were a general partner within two years before such appointment, or
any corporation or business association of which you were an executive officer
within two years before such appointment? yes ____ no X. If yes, please provide
specific details and, under separate cover, please provide copies of any
pleadings, orders or judgments associated therewith:
15. During the past five years, have you been convicted in a criminal proceeding
or named the subject of a pending criminal proceeding (excluding minor traffic
violations)? yes ____ no X. If yes, please provide specific details and, under
separate cover, please provide copies of any pleadings, orders or judgments
associated therewith:
16. During the past five years, have you been the subject of any order, judgment
or decree, not subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining you from, or
otherwise limiting your involvement in, the following activities:
(1) Acting as an investment adviser, underwriter, broker or dealer in
securities, or as an affiliated person, director or employee of any investment
company, bank, savings and loan association or insurance company, engaging in or
continuing conduct or practice in connection with such activity? yes ______ no
X. If yes, please provide specific details and, under separate cover, please
provide copies of any pleadings, orders or judgments associated therewith:
(2) Engaging in any type of business practice? yes ______ no X. If yes,
please provide specific details and, under separate cover, please provide copies
of any pleadings, orders or judgments associated therewith:
(3) Engaging in any activity in connection with the purchase or sale of any
security or in connection with any violation of federal or state securities
laws? yes ______ no X. If yes, please provide specific details and, under
separate cover, please provide copies of any pleadings, orders or judgments
associated therewith:
39
<PAGE>
17. During the past five years, have you been the subject of any order, judgment
or decree, not subsequently reversed, suspended or vacated, on any federal or
state authority barring, suspending or otherwise limiting for more than 60 days
the right of such person to act as an underwriter, investment adviser, broker or
dealer in securities, or as an affiliated person, director or employee of any
investment company, bank, savings and loan association or insurance company, or
engaging in or continuing any conduct or practice in connection with such
activity? yes ______ no X. If yes, please provide specific details and, under
separate cover, please provide copies of any pleadings, orders or judgments
associated therewith:
18. Have you ever been disbarred by any agency of the United States from
contracting with the United States? yes ______ no X. If yes, please provide
specific details and, under separate cover, please provide copies of any
pleadings, orders or judgments associated therewith:
19. Has it ever been the finding of any court of competent jurisdiction, the
Commodity Futures Trading Commission or the Securities and Exchange Commission,
or have you, by agreement or settlement with the foregoing, admitted or
consented to without admitting or denying, to charges that you:
(1) Have violated any provision(s) of the Commodity Exchange Act, the
Securities Act of 1933, the Securities Exchange Act of 1934, the Public Utility
Holding Company Act of 1935, the Trust Indenture Act of 1939, the Investment
Company Act of 1940, the Investment Advisors Act of 1940, the Securities
Investors Act of 1970, the Foreign Corrupt Practices Act of 1977, or any similar
statute of a state or foreign jurisdiction, or any rule or regulation under such
statutes? yes ______ no X. If yes, please provide specific details and, under
separate cover, please provide copies of any pleadings, orders or judgments
associated therewith:
(2) Have aided, abetted, counseled, commanded, induced, or procured the
violation by any other person of such statutes or rules or regulations? yes
______ no X. If yes, please provide specific details and, under separate cover,
please provide copies of any pleadings, orders or judgments associated
therewith:
You should be aware that the Juridical Entity is currently preparing
materials to be filed with the Securities and Exchange Commission in accordance
with rules and regulations of the Securities and Exchange Commission. The
information provided by you on this questionnaire may be used, in whole or in
part, as needed to comply with these rules and regulations. Please also include
with this completed questionnaire a current resume detailing your educational
background (including schools or universities attended, dates of graduation and
degrees received); and listing your work experience during the last five years
(including name of firm, dates of employment, principal positions held and
specific duties involved in those positions, and the nature of business and
location of such firms).
The answers and information which I have given above, including all
supplemental information attached hereto on separate sheets, each of which I
have signed, are true and accurate to the best of my knowledge. I have read and
understand the foregoing and I consent to the use of all or part of the
information provided in this questionnaire in the Registration Statement. I
further certify that the attached resume is a complete and accurate account of
my education, and work experience for the last five years, and that there are no
material facts required to be included therein in order to make the information
therein not misleading, which are not so included therein.
Dated: August 2, 1999
/s/ Michael H. Jordan
-------------------------------
Signature
Please return this completed form to us at the address listed on the letterhead
of this questionnaire!
Very truly yours,
/s/ Vanessa H. Lindsey
Vanessa H. Lindsey
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Charles J. Scimeca
1748 Independence Blvd, Suite D-1
Sarasota. Florida 34234
July 28, 1999
Dear Board Members, Yankee Companies and Stockholders:
Due to personal reasons I will be resigning as President, Chief Executive
Officer and Director of AmeriNet Group.com, Inc. effective August 6, 1999.
Sincerely,
/s/ Charles J. Scimeca
Charles J. Scimeca
President, AmeriNet Group.com, Inc.
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