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EXHIBIT 4.1
WORLDPORT COMMUNICATIONS, INC.
2000 LONG-TERM STOCK INCENTIVE PLAN
SECTION 1. Purpose of the Plan
The purpose of the WorldPort Communications, Inc. 2000 Long-Term Stock
Incentive Plan (the "Plan") is to promote the success, and enhance the value, of
WorldPort Communications, Inc. (the "Company") by linking the personal interests
of its directors, officers, employees and key consultants to those of Company
shareholders and by providing such individuals with an incentive for outstanding
performance. The Plan is further intended to provide flexibility to the Company
in its ability to motivate, attract, and retain the services of individuals upon
whose judgment, interest, and special effort the successful conduct of the
Company's operation is largely dependent.
SECTION 2. Definitions
For purposes of the Plan, the following terms shall have the meanings as
set forth below:
(a) "Award" means any Option, SAR (including a Limited SAR),
Restricted Stock, Performance Units, Stock granted as a bonus or in lieu of
other awards, other Stock-Based Award or other cash payments granted to a
Participant under the Plan.
(b) "Award Agreement" shall mean the written agreement, instrument
or document evidencing an Award.
(c) "Change of Control" means and includes each of the following:
(i) the acquisition, in one or more transactions, of beneficial
ownership (within the meaning of Rule 13d-3 under the
Exchange Act) by any person or entity or any group of
persons or entities who constitute a group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act)
(collectively, a "Person"), other than a trustee or other
fiduciary holding securities under an employee benefit plan
of the Company or a Subsidiary, of any securities of the
Company such that, as a result of such acquisition, such
Person (other than a Person covered under paragraph (c)(iv)
below) beneficially owns (within the meaning of Rule l3d-3
under the Exchange Act), directly or indirectly, voting
securities of the Company representing more than 50% of the
total voting power of the Company's then outstanding voting
securities entitled to vote on a regular basis for a
majority of the members of the Board of Directors of the
Company; provided that for this purpose, a Change in Control
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will not be deemed to have occurred if the acquisition does
not result, directly or indirectly, in a change in the
composition of the Board of Directors of the Company
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such that a majority of the members of the Board of
Directors of the Company are not Continuing Directors;
(ii) the merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which
would result in (x) the voting securities of the Company
outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at
least 50% of the total voting power represented by the
voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation
(including, without limitation, an entity that as a result
of that transaction owns the Company or all or substantially
all of the Company's assets either directly or through one
or more subsidiaries) in substantially the same proportions
relative to each other as their ownership, immediately prior
to that merger or consolidation, of the voting securities of
the Company, (y) no person (other than the Company, that
entity resulting from that merger or consolidation, or any
employee benefit plan (or related trust) sponsored or
maintained by the Company, any Subsidiary 80% or more of
whose outstanding voting stock is directly or indirectly
beneficially owned by the Company or that entity resulting
from that merger or consolidation) beneficially owning,
directly or indirectly, 30% or more of the then outstanding
shares of common stock of the entity resulting from that
merger or consolidation or the combined voting power of the
then outstanding voting securities entitled to vote
generally in the election of directors of that entity, and
(z) at least a majority of the members of the Board of
Directors of the entity resulting from that merger or
consolidation being Continuing Directors;
(iii) the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or
disposition by the Company of (in one or more transactions)
all or substantially all of the Company's assets; or
(iv) with respect to a Person who beneficially owns, as of the
date this Plan is adopted by the Company shareholders,
directly or indirectly, more than 25% of the total voting
power of the Company's then outstanding voting securities
entitled to vote on a regular basis for a majority of the
members of the Board of Directors of the Company, the
consummation by such Person of a transaction which results
in the Company no longer having any securities registered
pursuant to Section 12 of the Exchange Act.
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(d) "Exchange Act" means the Securities Exchange Act of 1934,
including amendments or successor statutes or similar intent.
(e) "Code" means the Internal Revenue Code of 1986, as amended from
time to time.
(f) A "Continuing Director" means, as of any date of determination,
any member of the Board of Directors of the Company who (i) was a member of such
Board on January 1, 2000, or (ii) was nominated for election or elected to such
Board with the affirmative vote of at least two-thirds (2/3) of the Continuing
Directors who were members of such Board at the time of such nomination or
election (either by a specific vote or by approval of the proxy statement of the
Company in which that person is named as a nominee for director, without
objection to that nomination), but excluding, for that purpose, any individual
whose initial assumption of office occurs as a result of an actual or threatened
election contest (within the meaning of Rule 14a-11 of the Exchange Act) with
respect to the election or removal of directors or other actual or threatened
solicitation or proxies or consents by or on behalf of a person other than the
Board of Directors.
(g) "Fair Market Value" means, with respect to Stock, Awards, or other
property, the fair market value of such Stock, Awards, or other property
determined by such methods or procedures as shall be established from time to
time by the Committee in good faith and in accordance with applicable law.
Unless otherwise determined by the Committee, the Fair Market Value of Stock
shall mean the closing sales price of Stock on the relevant date as reported on
the stock exchange or market on which the Stock is primarily traded, or if no
sale is made on such date, then the Fair Market Value is the weighted average of
the mean of the closing sales prices of the Stock on the next preceding day and
the next succeeding day on which such sales were made, as reported on the stock
exchange or market on which the Stock is primarily traded.
(h) "ISO" means any Option designated as an "incentive stock option"
within the meaning of Section 422 of the Code.
(i) "Limited SAR" means an SAR exercisable only for cash upon a Change
of Control or other event, as specified by the Committee.
(j) "Option" means a right granted to a Participant pursuant to
Section 6(b) to purchase Stock at a specified price during specified time
periods. An Option may be either an ISO or a nonstatutory Option (an Option not
designated as an ISO).
(k) "Performance Unit" means a right granted to a Participant pursuant
to Section 6(c) to receive a payment in cash equal to the increase in the book
value of the Company during specified time periods if specified performance
goals are met.
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(l) "Restricted Stock" means Stock awarded to a Participant pursuant
to Section 6(d) that may be subject to certain restrictions and to a risk of
forfeiture.
(m) "Stock" means the common stock, $.0001 par value per share, of the
Company.
(n) "Stock-Based Award" means a right that may be denominated or
payable in, or valued in whole or in part by reference to the market value of,
Stock, including, but not limited to, any Option, SAR (including a Limited SAR),
Restricted Stock, Stock granted as a bonus or Awards in lieu of cash
obligations.
(o) "SAR" or "Stock Appreciation Right" means the right granted to a
Participant pursuant to Section 6(e) to be paid an amount measured by the
appreciation in the Fair Market Value of Stock from the date of grant to the
date of exercise of the right, with payment to be made in cash, Stock or as
specified in the Award, as determined by the Committee.
(p) "Subsidiary" shall mean any corporation, during any period in
which it is a "subsidiary corporation" (as that term is defined in Section
424(f) of the Code) with respect to the Company.
SECTION 3. Administration of the Plan
The Plan shall be administered by a committee of the Board of Directors of
the Company consisting of two or more directors appointed, from time to time, by
the Board or, at the discretion of the Board from time to time, the Plan may be
administered by the Board (the "Committee"). Any action of the Committee in
administering the Plan shall be final, conclusive and binding on all persons,
including the Company, its Subsidiaries, employees, Participants, persons
claiming rights from or through Participants and shareholders of the Company;
provided that the terms and conditions of any Award under the Plan shall be
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subject to the ratification and approval by the Board of Directors of the
Company.
Subject to the provisions of the Plan (including the provisions of the
preceding paragraph), the Committee shall have full and final authority in its
discretion (a) to select the persons from among those eligible under Section 4
to participate in the Plan ("Participants") who will receive Awards pursuant to
the Plan; (b) to determine the type or types of Awards to be granted to each
Participant; (c) to determine the number of shares of Stock to which an Award
will relate, the terms and conditions of any Award granted under the Plan
(including, but not limited to, restrictions as to transferability or
forfeiture, exercisability or settlement of an Award and waivers or
accelerations thereof, and waivers of or modifications to performance conditions
relating to an Award, based in each case on such considerations as the Committee
shall determine) and all other matters to be determined in connection with an
Award; (d) to determine whether, to what extent, and under what circumstances an
Award may be settled, or the exercise price of an Award may be paid, in cash,
Stock, other Awards or other property, or an Award may be canceled, forfeited,
or surrendered; (e)
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to determine whether, and to certify that, performance goals to which the
settlement of an Award is subject are satisfied; (f) to correct any defect or
supply any omission or reconcile any inconsistency in the Plan, and to adopt,
amend and rescind such rules and regulations as, in its opinion, may be
advisable in the administration of the Plan; and (g) to make all other
determinations as it may deem necessary or advisable for the administration of
the Plan. The Committee may delegate to officers of the Company or any
Subsidiary the authority, subject to such terms as the Committee shall
determine, to perform administrative functions and to perform such other
functions as the Committee may determine, to the extent permitted under Rule
16b-3 under the Exchange Act, Section 162(m) of the Code and applicable law.
SECTION 4. Participation in the Plan
Participants in the Plan shall be selected by the Committee from among the
employees of the Company and its Subsidiaries, any consultant or other person
providing key services to the Company or a Subsidiary, and any member of the
Board of Directors of the Company or a Subsidiary; provided, however, that only
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persons who are key employees of the Company or any Subsidiary may be granted
Options which are intended to constitute ISOs.
SECTION 5. Plan Limitations; Shares Subject to the Plan
(a) Subject to the provisions of Section 8(a) hereof, the aggregate number
of shares of Stock available for issuance as Awards under the Plan shall not
exceed 15,000,000 shares of Stock plus, commencing on January 1, 2001, and on
each January 1 thereafter ending with January 1, 2007, the number of shares of
Stock shall be increased by the number of whole shares of Stock as is equal to
1% of the number of shares of Stock issued and outstanding on each such
January 1.
(b) Notwithstanding anything in the Plan to the contrary (subject to
adjustment as provided in Section 8(a) of the Plan), the aggregate number of
shares (i) available for issuance as Awards constituting ISOs shall not exceed
5,000,000 shares of Stock; (ii) that may be covered by Awards granted to any one
individual during any calendar year as Options and SARs shall be 2,500,000; or
(iii) that may be covered by Awards granted to any non-employee director in any
calendar year as an Option, SAR, and Restricted Stock shall be 250,000 shares of
Stock.
(c) No Award may be granted if the number of shares to which such Award
relates, when added to the number of shares previously issued under the Plan and
the number of shares which may then be acquired pursuant to other outstanding,
unexercised Awards, exceeds the number of shares available for issuance pursuant
to the Plan. If any shares subject to an Award are forfeited or such Award is
settled in cash or otherwise terminates for any reason whatsoever without an
actual distribution of shares to the Participant, any shares counted against the
number of shares available for issuance pursuant to the Plan with respect to
such Award shall, to the extent of any such forfeiture, settlement, or
termination, again be available for Awards under the Plan; provided, however,
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that the Committee may adopt procedures for the counting of shares relating to
any Award to ensure appropriate counting, avoid double counting, and provide for
adjustments in any case in which the
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number of shares actually distributed differs from the number of shares
previously counted in connection with such Award.
SECTION 6. Awards
(a) General. Subject to Section 3, Awards may be granted on the terms and
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conditions set forth in this Section 6. In addition, the Committee may impose
on any Award or the exercise thereof, at the date of grant or thereafter
(subject to Section 8(a)), such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the Committee shall determine,
including terms requiring forfeiture of Awards in the event of termination of
employment by the Participant; provided, however, that the Committee shall
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retain full power to accelerate or waive any such additional term or condition
as it may have previously imposed. All Awards shall be evidenced by an Award
Agreement.
(b) Options. Subject to Section 3, the Committee may grant Options to
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Participants on the following terms and conditions:
(i) Exercise Price. The exercise price of each Option shall be
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determined by the Committee at the time the Option is granted,
but (except as provided in Section 7(a)) the exercise price of
any Option shall not be less than the Fair Market Value of the
shares covered thereby at the time the Option is granted.
(ii) Time and Method of Exercise. The Committee shall determine the
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time or times at which an Option may be exercised in whole or
in part, whether the exercise price shall be paid in cash or by
the surrender at Fair Market Value of Stock, or by any
combination of cash and shares of Stock, including, without
limitation, cash, Stock, other Awards, or other property
(including notes or other contractual obligations of
Participants to make payment on a deferred basis, such as
through "cashless exercise" arrangements, to the extent
permitted by applicable law), and the methods by which Stock
will be delivered or deemed to be delivered to Participants.
(iii) Incentive Stock Options. The terms of any Option granted under
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the Plan as an ISO shall comply in all respects with the
provisions of Section 422 of the Code, including, but not
limited to, the requirement that no ISO shall be granted more
than ten years after the effective date of the Plan.
(c) Performance Units. Subject to Section 3, the Committee is authorized
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to grant Performance Units to Participants on the following terms and
conditions:
(i) Performance Criteria and Period. At the time it makes an award
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of Performance Units, the Committee shall establish both the
performance goal or goals and the performance period or periods
applicable to the Performance
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Units so awarded. A performance goal shall be a goal, expressed
in terms of growth in book value, earnings per share, return on
equity or any other financial or other measurement deemed
appropriate by the Committee, or may relate to the results of
operations or other measurable progress of either the Company
as a whole or the Participant's Subsidiary, division or
department. The performance period will be the period of time
over which one or more of the performance goals must be
achieved, which may be of such length as the Committee, in its
discretion, shall select. Neither the performance goals nor the
performance periods need be identical for all Performance Units
awarded at any time or from time to time. The Committee shall
have the authority, in its discretion, to accelerate the time
at which any performance period will expire or waive or modify
the performance goals of any Participant or Participants. The
Committee may also make such adjustments, to the extent it
deems appropriate, to the performance goals for any Performance
Units awarded to compensate for, or to reflect, any material
changes which may have occurred in accounting practices, tax
laws, other laws or regulations, the financial structure of the
Company, acquisitions or dispositions of business or
Subsidiaries or any unusual circumstances outside of
management's control which, in the sole judgment of the
Committee, alters or affects the computation of such
performance goals or the performance of the Company or any
relevant Subsidiary, division or department.
(ii) Value of Performance Units. The value of each Performance Unit
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at any time shall equal the book value per share of the Stock,
as such value appears on the consolidated balance sheet of the
Company as of the end of the fiscal quarter immediately
preceding the date of valuation.
(d) Restricted Stock. Subject to Section 3, the Committee is authorized
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to grant Restricted Stock to Participants on the following terms and conditions:
(i) Restricted Period. Restricted Stock awarded to a Participant
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shall be subject to such restrictions on transferability and
other restrictions for such periods as shall be established by
the Committee, in its discretion, at the time of such Award,
which restrictions may lapse separately or in combination at
such times, under such circumstances, or otherwise, as the
Committee may determine.
(ii) Forfeiture. Restricted Stock shall be forfeitable to the
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Company upon termination of employment during the applicable
restricted periods. The Committee, in its discretion, whether
in an Award Agreement or anytime after an Award is made, may
accelerate the time at which restrictions or forfeiture
conditions will lapse or remove any such restrictions,
including upon death,
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disability or retirement, whenever the Committee determines
that such action is in the best interests of the Company.
(iii) Certificates for Stock. Restricted Stock granted under the
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Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Stock are
registered in the name of the Participant, such certificates
may bear an appropriate legend referring to the terms,
conditions and restrictions applicable to such Restricted
Stock.
(iv) Rights as a Shareholder. Subject to the terms and conditions
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of the Award Agreement, the Participant shall have all the
rights of a shareholder with respect to shares of Restricted
Stock awarded to him or her, including, without limitation, the
right to vote such shares and the right to receive all
dividends or other distributions made with respect to such
shares. If any such dividends or distributions are paid in
Stock, the Stock shall be subject to restrictions and a risk of
forfeiture to the same extent as the Restricted Stock with
respect to which the Stock has been distributed.
(e) Stock Appreciation Rights. Subject to Section 3, the Committee is
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authorized to grant SARs to Participants on the following terms and conditions:
(i) Right to Payment. An SAR shall confer on the Participant to
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whom it is granted a right to receive, upon exercise thereof,
the excess of (x) the Fair Market Value of one share of Stock
on the date of exercise over (y) the grant price of the SAR as
determined by the Committee as of the date of grant of the SAR,
which grant price (except as provided in Section 7(a)) shall
not be less than the Fair Market Value of one share of Stock on
the date of grant.
(ii) Other Terms. The Committee shall determine the time or times
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at which an SAR may be exercised in whole or in part, the
method of exercise, method of settlement, form of consideration
payable in settlement, method by which Stock will be delivered
or deemed to be delivered to Participants, whether or not an
SAR shall be in tandem with any other Award, and any other
terms and conditions of any SAR. Limited SARs may be granted on
such terms, not inconsistent with this Section 6(e), as the
Committee may determine. Limited SARs may be either
freestanding or in tandem with other Awards.
(f) Bonus Stock and Awards in Lieu of Cash Obligations. Subject to
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Section 3, the Committee is authorized to grant Stock as a bonus, or to grant
Stock or other Awards in lieu of Company or Subsidiary obligations to pay cash
or deliver other property under other plans or compensatory arrangements;
provided that, in the case of Participants subject to Section 16 of the Exchange
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Act, such cash amounts are determined under such other plans in a manner that
complies with applicable requirements of Rule 16b-3 under the Exchange Act so
that the acquisition of Stock
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or Awards hereunder shall be exempt from Section 16(b) liability. Subject to
Section 3, Stock or Awards granted hereunder shall be subject to such other
terms as shall be determined by the Committee.
(g) Other Stock-Based Awards. Subject to Section 3, the Committee is
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authorized, subject to limitations under applicable law, to grant to
Participants such other Stock-Based Awards in addition to those provided in
Sections 6(b), (d) and (e) hereof, as deemed by the Committee to be consistent
with the purposes of the Plan. Subject to Section 3, the Committee shall
determine the terms and conditions of such Awards. Stock delivered pursuant to
an Award in the nature of a purchase right granted under this Section 6(g) shall
be purchased for such consideration and paid for at such times, by such methods,
and in such forms, including, without limitation, cash, Stock, other Awards, or
other property, as the Committee shall determine.
(h) Cash Payments. Subject to Section 3, the Committee is authorized,
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subject to limitations under applicable law, to grant to Participants cash
payments, whether awarded separately or as a supplement to any Stock-Based
Award. Subject to Section 3, the Committee shall determine the terms and
conditions of such Awards.
(i) Dividends and Dividend Equivalents. An Award (including without
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limitation an Option or SAR Award) may provide the Participant with the right to
receive dividend payments or dividend equivalent payments with respect to Stock
subject to the Award (both before and after the Stock subject to the Award is
earned, vested, or acquired), which payments may be either made currently or
credited to an account for the Participant, and may be settled in cash or Stock
as determined by the Committee. Any such settlements, and any such crediting of
dividends or dividend equivalents or reinvestment in shares of Stock, may be
subject to such conditions, restrictions and contingencies as the Committee
shall establish, including the reinvestment of such credited amounts in Stock
equivalents.
SECTION 7. Additional Provisions Applicable to Awards
(a) Stand-Alone, Additional, Tandem, and Substitute Awards. Awards granted
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under the Plan may, in the discretion of the Committee, be granted either alone
or in addition to, in tandem with, or in substitution for, any other Award
granted under the Plan or any award granted under any other plan of the Company
or any Subsidiary, or any business entity acquired by the Company or any
Subsidiary, or any other right of a Participant to receive payment from the
Company or any Subsidiary. If an Award is granted in substitution for another
Award or award, the Committee shall require the surrender of such other Award or
award in consideration for the grant of the new Award. Awards granted in
addition to, or in tandem with other Awards or awards may be granted either as
of the same time as, or a different time from, the grant of such other Awards or
awards. The per share exercise price of any Option, grant price of any SAR, or
purchase price of any other Award conferring a right to purchase Stock:
(i)granted in substitution for an outstanding Award or award, shall be not less
than the lesser of (x) the Fair Market Value of a share of Stock at the date
such substitute Award is granted or (y) such Fair Market Value at that date,
reduced to reflect the Fair
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Market Value at that date of the Award or award required to be surrendered by
the Participant as a condition to receipt of the substitute Award; or (ii)
retroactively granted in tandem with an outstanding Award or award, shall not be
less than the lesser of the Fair Market Value of a share of Stock at the date of
grant of the later Award or at the date of grant of the earlier Award or award.
(b) Exchange and Buy Out Provisions. The Committee may at any time offer
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to exchange or buy out any previously granted Award for a payment in cash,
Stock, other Awards (subject to Section 7(a)), or other property based on such
terms and conditions as the Committee shall determine and communicate to a
Participant at the time that such offer is made.
(c) Performance Conditions. The right of a Participant to exercise or
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receive a grant or settlement of any Award, and the timing thereof, may be
subject to such performance conditions as may be specified by the Committee.
(d) Term of Awards. The term of each Award shall, except as provided
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herein, be for such period as may be determined by the Committee; provided,
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however, that in no event shall the term of any ISO, or any SAR granted in
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tandem therewith, exceed a period of ten years from the date of its grant (or
such shorter period as may be applicable under Section 422 of the Code).
(e) Form of Payment. Subject to the terms of the Plan and any applicable
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Award Agreement, payments or transfers to be made by the Company or a Subsidiary
upon the grant or exercise of an Award may be made in such forms as the
Committee shall determine, including, without limitation, cash, Stock, other
Awards, or other property (and may be made in a single payment or transfer, in
installments, or on a deferred basis), in each case determined in accordance
with rules adopted by, and at the discretion of, the Committee. (Such payments
may include, without limitation, provisions for the payment or crediting of
reasonable interest on installments or deferred payments.) The Committee, in
its discretion, may accelerate any payment or transfer upon a change in control
as defined by the Committee. The Committee may also authorize payment upon the
exercise of an Option by net issuance or other cashless exercise methods.
(f) Awards to Comply with Section 162(m). The Committee may (but is not
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required to) grant an Award pursuant to the Plan to any key employee which is
intended to qualify as "performance-based compensation" under Section 162(m) of
the Code (a "Performance-Based Award"). The right to receive a Performance-
Based Award, other than Options and SARs granted at not less than Fair Market
Value, shall be conditional upon the achievement of performance goals
established by the Committee in writing at the time such Performance-Based Award
is granted. Such performance goals, which may vary from Participant to
Participant and Performance-Based Award to Performance-Based Award, shall be
based upon the attainment by the Company or any Subsidiary, division or
department of specific amounts of, or increases in, one or more of the
following, any of which may be measured either in absolute terms or as compared
to another company or companies: revenues, earnings, cash flow, net worth, book
value, shareholders' equity, financial return ratios, market performance or
total shareholder return, and/or the completion of certain business or capital
transactions. Before any compensation pursuant to a Performance-Based Award is
paid, the
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Committee shall certify in writing that the performance goals applicable to the
Performance-Based Award were in fact satisfied.
The maximum amount which may be granted as Performance-Based Awards to
any Participant in any calendar year shall not exceed (i) Stock-Based Awards for
2,500,000 shares of Stock (whether payable in cash or Stock), subject to
adjustment as provided in Section 8(a) hereof, (ii) 1,000,000 Performance Units,
and (iii) cash payments of $1,000,000.
(g) Change of Control. In the event of a Change of Control of the Company,
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all Awards granted under the Plan (including Performance-Based Awards) that are
still outstanding and not yet vested or exercisable or which are subject to
restrictions, subject to such additional conditions (whether occurring at the
time of such Change in Control or thereafter) as the Committee shall determine
and as shall be set forth in the Award Agreement with the Participant, may
become immediately 100% vested in each Participant or may be free of any
restrictions, as of the first date that the definition of Change of Control has
been fulfilled, and shall be exercisable for such period (but not in excess of
the remaining duration of the Award) as is provided in such Award Agreement.
SECTION 8. Adjustments upon Changes in Capitalization; Acceleration in Certain
Events
(a) In the event that the Committee shall determine that any stock
dividend, recapitalization, forward split or reverse split, reorganization,
merger, consolidation, spin-off, combination, repurchase or share exchange, or
other similar corporate transaction or event, affects the Stock or the book
value of the Company such that an adjustment is appropriate in order to prevent
dilution or enlargement of the rights of Participants under the Plan, then the
Committee shall, in such manner as it may deem equitable, adjust any or all of
(i) the number and kind of shares of Stock which may thereafter be issued in
connection with Awards; (ii) the number and kind of shares of Stock issuable in
respect of outstanding Awards; (iii) the aggregate number and kind of shares of
Stock available under the Plan; (iv) the number of Performance Units which may
thereafter be granted and the book value of the Company with respect to
outstanding Performance Units; and (v) the exercise price, grant price, or
purchase price relating to any Award or, if deemed appropriate, make provision
for a cash payment with respect to any outstanding Award; provided, however, in
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each case, that no adjustment shall be made which would cause the Plan to
violate Section 422(b)(1) of the Code with respect to ISOs or would adversely
affect the status of a Performance-Based Award as "performance-based
compensation" under Section 162(m) of the Code.
(b) In addition, the Committee is authorized to make adjustments in the
terms and conditions of, and the criteria included in, Awards in recognition of
unusual or nonrecurring events (including, without limitation, events described
in the preceding paragraph) affecting the Company or any Subsidiary, or in
response to changes in applicable laws, regulations, or accounting principles.
Notwithstanding the foregoing, no adjustment shall be made in any outstanding
Performance-Based Awards to the extent that such adjustment would adversely
affect the status of that Performance-Based Award as "performance-based
compensation" under Section 162(m) of the Code.
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SECTION 9. General Provisions
(a) Changes to the Plan and Awards. The Board of Directors of the Company
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may amend, alter, suspend, discontinue, or terminate the Plan or the Committee's
authority to grant Awards under the Plan without the consent of the Company's
shareholders or Participants, except that any such amendment, alteration,
suspension, discontinuation, or termination shall be subject to the approval of
the Company's shareholders within one year after such Board action if such
shareholder approval is required by any federal or state law or regulation or
the rules of any stock exchange or automated quotation system on which the Stock
may then be listed or quoted, and the Board may otherwise, in its discretion,
determine to submit other such changes to the Plan to the shareholders for
approval; provided, however, that without the consent of an affected
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Participant, no amendment, alteration, suspension, discontinuation, or
termination of the Plan may materially and adversely affect the rights of such
Participant under any Award theretofore granted and any Award Agreement relating
thereto. The Committee may waive any conditions or rights under, or amend,
alter, suspend, discontinue, or terminate, any Award theretofore granted and any
Award Agreement relating thereto; provided, however, that without the consent of
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an affected Participant, no such amendment, alteration, suspension,
discontinuation, or termination of any Award may materially and adversely affect
the rights of such Participant under such Award.
The foregoing notwithstanding, any performance condition specified in
connection with an Award shall not be deemed a fixed contractual term, but shall
remain subject to adjustment by the Committee, in its discretion at any time in
view of the Committee's assessment of the Company's strategy, performance of
comparable companies, and other circumstances, except to the extent that any
such adjustment to a performance condition would adversely affect the status of
a Performance-Based Award as "performance-based compensation" under Section
162(m) of the Code.
(b) No Right to Award or Employment. No Participant or other person shall
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have any claim or right to receive an Award under the Plan. Neither the Plan
nor any action taken hereunder shall be construed as giving any employee any
right to be retained in the employ of the Company or any Subsidiary.
(c) Taxes. The Company or any Subsidiary is authorized to withhold from
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any Award granted, any payment relating to an Award under the Plan, including
from a distribution of Stock or any payroll or other payment to a Participant
amounts of withholding and other taxes due in connection with any transaction
involving an Award, and to take such other action as the Committee may deem
advisable to enable the Company and Participants to satisfy obligations for the
payment of withholding taxes and other tax obligations relating to any Award.
This authority shall include authority to withhold or receive Stock or other
property and to make cash payments in respect thereof in satisfaction of a
Participant's tax obligations.
(d) Limits on Transferability; Beneficiaries. No Award or other right or
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interest of a Participant under the Plan shall be pledged, encumbered, or
hypothecated to, or in favor of, or subject to any lien, obligation, or
liability of such Participants to, any party, other than the Company or any
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<PAGE>
Subsidiary, or assigned or transferred by such Participant otherwise than by
will or the laws of descent and distribution, and such Awards and rights shall
be exercisable during the lifetime of the Participant only by the Participant or
his or her guardian or legal representative. Notwithstanding the foregoing, the
Committee may, in its discretion, provide that Awards or other rights or
interests of a Participant granted pursuant to the Plan (other than an ISO) be
transferable, without consideration, to such persons as may be permitted by the
Committee. The Committee may attach to such transferability feature such terms
and conditions as it deems advisable. In addition, a Participant may, in the
manner established by the Committee, designate a beneficiary (which may be a
person or a trust) to exercise the rights of the Participant, and to receive any
distribution, with respect to any Award upon the death of the Participant. A
beneficiary, guardian, legal representative or other person claiming any rights
under the Plan from or through any Participant shall be subject to all terms and
conditions of the Plan and any Award Agreement applicable to such Participant,
except as otherwise determined by the Committee, and to any additional
restrictions deemed necessary or appropriate by the Committee.
(e) No Rights to Awards; No Shareholder Rights. No Participant shall have
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any claim to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of Participants. No Award shall confer on any
Participant any of the rights of a shareholder of the Company unless and until
Stock is duly issued or transferred to the Participant in accordance with the
terms of the Award.
(f) Discretion. In exercising, or declining to exercise, any grant of
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authority or discretion hereunder, the Committee may consider or ignore such
factors or circumstances and may accord such weight to such factors and
circumstances as the Committee alone and in its sole judgment deems appropriate
and without regard to the affect such exercise, or declining to exercise such
grant of authority or discretion, would have upon the affected Participant, any
other Participant, any employee, the Company, any Subsidiary, any shareholder or
any other person.
(g) Effective Date; Shareholder Approval. Subject to the approval of the
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shareholders of the Company at the Company's 2000 annual meeting of its
shareholders, the Plan shall be effective as of March 15, 2000; provided,
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however, that to the extent that Awards are granted under the Plan prior to its
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approval by shareholders, the Awards shall be contingent on approval of the Plan
by the shareholders of the Company at such annual meeting.
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