EXHIBIT D
SITI-SITES.COM, INC.
1999 STOCK OPTION PLAN
1. Name and Effective Date
The name of this plan is the Siti-Sites.com, Inc. 1999 Stock Option
Plan (the "Plan"). The Plan shall be effective upon approval by the stockholders
of the Company.
2. Purpose
The purpose of the Plan is to permit the Company and its Affiliates
(as defined below) to attract and retain the best available personnel for
positions of substantial responsibility, to provide additional incentives to
employees and consultants of the Company and its Affiliates, and to promote the
success of the business of the Company and its Affiliates.
3. Definitions
As used in the Plan, the following terms shall have the meanings set
forth below:
(a) "Administrator" shall have the meaning given such term in Section
4 below.
(b) "Affiliate" shall mean any entity that, directly or through one
or more intermediaries, is controlled by, controls or is under common control
with the Company.
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Change of Control shall mean (i) the consummation of a sale,
transfer or other disposition of all or substantially all of the Company's
assets; (ii) approval by the stockholders of the Company of a merger or
consolidation in which securities possessing more than 50% of the total combined
voting power of the Company's outstanding securities are transferred to a Person
or Persons different from the Persons holding those immediately prior to such
transaction; (iii) a change in the composition of the Board over a period of
twenty-four (24) months or less such that a majority of the Board members ceases
to be comprised of individuals who have either been Board members continuously
since the beginning of such period or have been elected or nominated for
selection as Board members by a majority of the continuing Board members; (iv)
approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company; or (v) the acquisition by any Person or related
group of Persons (other than the Company or a Person that directly or indirectly
controls, is controlled by, or is under common control with, the Company) of
beneficial ownership of more than 50% of the Company's outstanding voting stock
without the Board's recommendation.
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
(f) "Company" shall mean Siti-Sites.com, Inc., a Delaware
corporation.
(g) "Consultant" shall mean any Person who contracts to provide
services to the Company or any Affiliate as an independent contractor.
(h) "Director" shall mean a member of the Board, or the board of
directors of any Affiliate.
(i) "Employee" shall mean any person, including officers and
Directors, who is an employee of the Company or any Affiliate.
(j) "Fair Market Value" shall mean, with respect to Shares or other
securities (i) the closing price per Share of the Shares on the principal
exchange on which the Shares are then trading, if any, on such date, or, if the
Shares were not traded on such date, then on the next preceding trading day
during which a sale occurred; or (ii) if the Shares are not traded on an
exchange but are quoted on NASDAQ or a successor quotation system, (A) the last
sales price (if the Shares are then listed as a National Market Issue under the
NASDAQ National Market System) or (B) the mean between the closing
representative bid and asked prices (in all other cases) for the Shares on such
date as reported by NASDAQ or such successor quotation system; or (iii) if the
Shares are not publicly traded on an exchange and not quoted on NASDAQ or a
successor quotation system, the mean between the closing bid and asked prices
for the Shares on such date as determined in good faith by the Administrator; or
(iv) if the provisions of clauses (i), (ii) and (iii) shall not be applicable,
the fair market value established by the Administrator acting in good faith.
(k) "ISO" shall mean an Option intended to qualify as an incentive
stock option within the meaning of Section 422 of the Code, as designated in the
option agreement relating thereto.
(l) "Non-Employee Director" shall mean each Director who is not an
Employee or Consultant and who otherwise is considered a "non-employee" director
for purposes of Rule 16b-3.
(m) "NQSO" shall mean an Option that is not intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code, as
designated in the option agreement relating thereto.
(n) "Option" means an ISO or a NQSO granted pursuant to the Plan.
(o) "Optionee" shall mean an Employee, Consultant or Non-Employee
Director who receives an Option.
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(p) "Person" shall mean any individual, corporation, partnership,
association, joint- stock company, trust, unincorporated organization, or
government or political subdivision thereof.
(q) "Rule 16b-3" shall mean Rule 16b-3 promulgated by the Securities
and Exchange Commission under the Securities Exchange Act of 1934, as amended,
or any successor rule or regulation thereto.
(r) "Shares" shall mean the common stock of the Company, par value
$0.001 per share, and such other securities or property as may become the
subject of Options pursuant to Subsection 7(j) below.
(s) "10% Shareholder" shall mean a Person, who together with his or
her spouse, children and trusts and custodial accounts for their benefit,
immediately at the time of the grant of an Option and assuming its immediate
exercise, would beneficially own, within the meaning of Section 424(d) of the
Code, Shares possessing more than ten percent (10%) of the total combined voting
power of all of the outstanding capital stock of the Company or any of its
Affiliates.
4. Shares Subject to the Plan
Subject to Subsection 7(j) below, the maximum aggregate number of Shares
which may be issued to Employees, Consultants and Non-Employee Directors under
the Plan is one million eight hundred thousand (1,800,000). The Shares issued
upon exercise of Options may be authorized and unissued shares, or Shares held
by the Company in its treasury. If any Option shall terminate or expire without
having been exercised in full, the unpurchased Shares that were subject thereto
shall, unless the Plan shall have been terminated, become available for future
grant under the Plan.
5. Administration of the Plan
The Plan shall be administered by the Board, or, at the election of such
Board, by a committee thereof appointed by the Board (the Board or such
committee being hereafter referred to in such capacity as the "Administrator")
composed of not less than two directors, each of whom is a "non-employee
director" as defined in Rule 16b-3, and an "outside director" as defined for
purposes of Section 162(m) of the Code. If such a committee is appointed by the
Board, (a) such committee shall continue to serve in its designated capacity
until otherwise directed by the Board, and (b) from time to time the Board may
increase the size of such committee and appoint additional members thereof,
remove members (with or without cause) and appoint new members in substitution
therefor, fill vacancies, however caused, and remove all members of such
committee and thereafter directly administer the Plan, all to the extent
permitted by the applicable law. The Administrator shall interpret the Plan,
prescribe, amend and rescind any rules and regulations necessary or appropriate
for the administration of the Plan, and make such other determinations and take
such other actions as it deems necessary or advisable to cause the Plan to
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operate in an effective manner. Any interpretation, determination or other
action made or taken by the Administrator shall be final, binding and
conclusive.
The Administrator may employ attorneys, consultants, accountants or other
persons and the Administrator, the Company and its officers and directors shall
be entitled to rely upon the advice, opinions or valuations of any such persons.
No member of the Administrator shall be personally liable for any action,
determination or interpretation taken or made in good faith with respect to the
Plan or any Option, and all members of the Administrator shall be fully
indemnified and protected by the Company in respect of any such action,
determination or interpretation.
6. Eligibility; Grant of Options
Under the Plan, Options may be granted to Employees, Consultants and
Non-Employee Directors; provided, that ISOs may be granted only to Employees.
From time to time as it may determine, the Administrator shall designate those
Employees, Consultants and Non-Employee Directors to whom an Option is to be
granted and the number of Shares to be covered by such Option. In determining
the persons to whom Options shall be granted and the number of Shares to be
covered by each Option, the Administrator shall take into account the nature of
such person's duties, such person's present and potential contributions to the
success of the Company and the Affiliates and such other factors as it shall
deem relevant in connection with accomplishing the purposes of the Plan. A
person who has been granted an Option or Options under the Plan may, if he or
she is otherwise eligible, be granted an additional Option or Options.
7. Terms and Conditions of Options
Each Option granted under the Plan shall be evidenced by a written
agreement, in a form approved by the Administrator. Each Option shall be
designated in such option written agreement as an ISO or a NQSO. However,
notwithstanding such designations, to the extent that the aggregate Fair Market
Value of Shares with respect to which Options designated as ISOs are exercisable
for the first time by any Optionee during any calendar year (under all plans of
the Company or any Affiliate) exceeds $100,000, such excess options shall be
treated as NQSOs. In addition, each Option shall be subject to the following
terms and conditions and to such other terms and conditions as the Administrator
shall deem appropriate:
(a) Option Term
The term of each NQSO shall be fixed by the Administrator. The term of
each ISO shall in no event be more than ten (10) years from the date of
grant, or, in the case of ISOs granted to 10% Percent Shareholders, five
(5) years from the date of grant.
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(b) Exercise Price
The purchase price per Share purchasable under each Option shall be
specified by the Administrator at the time such Option is granted. The
purchase price per Share purchasable under each NQSO shall be the price
determined by the Administrator. The purchase price per Share purchasable
under each ISO shall not be less than 100% of the Fair Market Value of a
Share on the date of grant, or, in the case of ISOs granted to 10% Percent
Shareholders, 110% of the Fair Market Value of a Share on the date of
grant.
(c) Time and Method of Exercise
The Administrator shall establish the time or times at which each
Option, or any part thereof, may be exercised. Such date may be immediately
upon the grant of such Option, or may be delayed until the participant has
remained in the employ of the Company or an Affiliate for a continuous
period after the date of grant as shall be determined by the Administrator.
The Administrator shall also establish the form or forms in which, payment
of the option price with respect thereto may be made or deemed to have been
made (including, (i) cash or Shares, or other consideration, or any
combination thereof, having a Fair Market Value on the exercise date equal
to the relevant option price and (ii) a broker-assisted cashless exercise
program established by the Administrator), provided in each case that such
methods avoid "short-swing" profits to Plan participants under Section
16(b) of the Securities Exchange Act of 1934, as amended. An Option shall
be deemed to be exercised when written notice of such exercise has been
given to the Company in accordance with the terms of the option agreement
by the person entitled to exercise the Option and the Company has received
full payment for the Shares with respect to which the Option is exercised.
(d) Termination of Directorship or Employment or Consulting Relationship
Subject to Subsection 7(e) below, in the event of termination of an
Optionee's status as a Director, Employee or Consultant, such Optionee may,
but only within three (3) months (or such other period of time not less
than thirty (30) days and not more than twelve (12) months as is determined
by the Administrator, with such determination in the case of an ISO being
made at the time of grant of the Option and not exceeding three (3)
months), with such determination in the case of an ISO being made at the
time of grant of the Option and not exceeding three (3) months after the
date of such termination (but in no event later than the expiration date of
the term of his or her Option), exercise his or her Option to the extent
that such Optionee was entitled to exercise it at the date of such
termination. To the extent that such Optionee was not entitled to exercise
his or her Option at the date of such termination, or if such Optionee does
not exercise such Option to the extent so entitled within the time
specified herein, such Option shall terminate. No termination shall be
deemed to occur and this Subsection 7(d) shall not apply if (i) the
Optionee is a Non- Employee Director who becomes an Employee or a
Consultant, or (ii) the Optionee is an Employee who becomes a Non-Employee
Director or a Consultant, or (iii) the Optionee is a Consultant who becomes
a Non-Employee Director or an Employee.
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(e) Exercise in the Event of Disability
Notwithstanding Subsection 7(d) above, in the event of termination of
an Optionee's status as a Director, Employee or Consultant as a result of
his or her total and permanent disability (within the meaning of Section
22(e)(3) of the Code), such Optionee may, but only within twelve (12)
months from the date of such termination (but in no event later than the
expiration date of the term of such Optionee's Option), exercise his or her
Option to the extent that such Optionee was entitled to exercise it at the
date of such termination. To the extent that such Optionee was not entitled
to exercise such Option at the date of termination, or if such Optionee
does not exercise such Option to the extent so entitled within the time
specified herein, such Option shall terminate.
(f) Exercise in the Event of Death
In the event of the death of an Optionee while he or she was a
Director, Employee or Consultant, or within thirty (30) days following the
termination of such person's status as a Director, Employee or Consultant,
such Optionee's Option may be exercised, at any time within twelve (12)
months following the date of death (but in no event later than the
expiration date of the term of such Optionee's Option) by such Optionee's
estate or by a person who acquired the right to exercise such Optionee's
Option by bequest or inheritance, but only to the extent such Optionee was
entitled to exercise the option at the date of death or, if earlier, the
date of termination of such person's status as a Director, Employee or
Consultant. To the extent that such Optionee was not entitled to exercise
his or her Option at the date of death or termination, as the case may be,
or if such Optionee (or another person referred to above) does not exercise
such Option to the extent so entitled within the time specified herein,
such Option shall terminate.
(g) Buyout Provisions
The Administrator may at any time offer to buy out any previously
granted Option for a payment in cash, Shares, or other Options, based on
such terms and conditions as the Administrator shall establish and
communicate to the Optionee at the time that such offer is made.
(h) Nontransferability
Options may not be sold, pledged, assigned, hypothecated, transferred
or disposed of in any manner other than by will or by the laws of descent
or distribution; provided, however, that the Administrator may in its
discretion grant transferable NQSOs pursuant to option agreements
specifying (i) the manner in which such NQSOs are transferable and (ii)
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that any such transfer shall be subject to applicable law. Options may be
exercised, sold, pledged, assigned, hypothecated, transferred or disposed
of during the lifetime of the Optionee only by the Optionee or a transferee
permitted by this Subsection 7(h), or, with respect to NQSOs, by the
guardian or legal representative of such Optionee or transferee if
permitted by applicable law.
(i) Conditions Upon Issuance of Shares
Shares shall not be issued pursuant to the exercise of an Option
unless such exercise and the delivery of such Shares shall comply with all
applicable laws, including, without limitation, the Securities Act of 1933,
as amended, and the rules and regulations promulgated thereunder. Each
Option may provide that, as a condition to the exercise of such Option, the
Optionee thereof shall deliver to the Administrator at the time of such
exercise (in whole or in part) a written representation that the Shares
being acquired upon such exercise are to be acquired for investment and not
for resale or with a view to the distribution thereof. The Company may
place legends on stock certificates issued under the Plan as the
Administrator deems necessary or appropriate in order to comply with
applicable securities laws, including, but not limited to, legends
restricting the transfer of such stock.
(j) Adjustments
In the event of a change in the common stock of the Company by reason
of any stock dividend, recapitalization, reorganization, merger,
consolidation, split-up, spin-off, combination or exchange of shares or
similar event, the number and kind of Shares which shall be covered by the
Plan, and the number and kind of Shares subject to outstanding Options,
along with the option price attaching to such Shares, may be appropriately
adjusted consistent with such change in a manner to be determined by the
Administrator to prevent substantial dilution or enlargement of the rights
granted or available participants in the Plan; provided, however, in 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 any Option as "performance-based
compensation" under Section 162(m) of the Code.
(k) Change of Control
In the event of a Change of Control of the Company, each Option
granted under the Plan that is still outstanding and not yet vested or
exercisable shall immediately become 100% vested in the Optionee thereof,
as of the first date that the definition of Change of Control has been
fulfilled, and shall be exercisable for the remaining duration of such
Option. Each Option that is exercisable as of the effective date of the
Change of Control will remain exercisable for the remaining duration of
such Option.
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8. No Rights as Stockholders; No Right to Continued Service; No Fractional
Shares
No Optionee shall have any rights as a stockholder with respect to any
Shares subject to an Option held by him or her prior to the date of issuance to
him or her of a certificate or certificates for such Shares. Neither the
existence of the Plan, nor any Option held under the Plan shall grant to any
person any right with respect to continued service with the Company or any
Affiliate, nor shall they interfere in any way with the right of the Company or
any Affiliate to terminate such service at any time. No fractional Shares shall
be delivered, nor shall any cash in lieu of fractional shares be paid under the
Plan.
9. Legal Compliance
The Plan and the grant of Options thereunder, and the obligation of the
Company to deliver shares upon exercise of Options, shall be subject to approval
of the Plan by the stockholders of the Company and to all applicable federal,
state or local laws, regulations and rules, and to such approvals of competent
government agencies as may, in the opinion of the Administrator, be required.
10. Amendment and Termination
The Board may amend, terminate or modify the Plan at any time and for any
reason. Amendments require the approval of the Company's stockholders only to
the extent provided by Section 422 of the Code, Rule 16b-3, or any other
applicable law, rule or regulation. No amendment, termination or modification of
the Plan shall alter or amend any rights or obligations under any Option
theretofore granted without the consent of the holder of such Option.
11. Term of Plan
Options may be granted pursuant to the Plan until the tenth anniversary of
the date that the Plan is approved by the stockholders of the Company.
12. Withholding
The Company and the Affiliates are authorized to withhold from any payment
relating to the exercise of an Option under the Plan, including from any payroll
or other payment to an Optionee, amounts of withholding and other taxes due in
connection with any transaction involving an Option, and to take such other
action as the Administrator may deem advisable to enable the Company and the
Optionees to satisfy obligations for the payment of withholding taxes and other
tax obligations relating to any Option. This authority shall include authority
to withhold or receive Shares or other property and to make cash payments in
respect thereof in satisfaction of an Optionee's tax obligations.
13. Governing Law
The provisions of the Plan shall be governed by and construed in accordance
with the laws of the State of New York and applicable Federal law.
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SPECTRUM INFORMATION TECHNOLOGIES, INC.
PROXY
(SOLICITED BY THE BOARD OF DIRECTORS)
The undersigned appoints _____________________ and ______________, or either of
them, proxies with full power of substitution, to represent and vote all shares
of Common Stock of Spectrum Information Technologies, Inc. held by the
undersigned, at the Annual Meeting of Stockholders to be held November ____,
1999, or any adjournment thereof.
1. Election of four Directors.
Class I Nominees: JONATHAN BLANK and BARCLAY POWERS
Class II Nominee: ROBERT INGENITO
Class III Nominee: LAWRENCE M. POWERS
Check only one of the following two boxes:
[CHECK BOX] VOTE FOR all nominees listed above, except vote withheld as
to the following nominees (if any):
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[CHECK BOX] VOTE WITHHELD from all nominees
2. TO APPROVE THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO, AMONG OTHER THINGS, (A) CHANGE THE NAME OF THE
COMPANY TO "SITI-SITES.COM, INC.", (B) INCREASE THE NUMBER OF
AUTHORIZED SHARES OF COMMON STOCK FROM 10,000,000 TO 35,000,000,
AND THE NUMBER OF AUTHORIZED SHARES OF PREFERRED STOCK FROM
2,000,000 TO 5,000,000, (C) DELETE THE AUTHORIZATION FOR AND ALL
REFERENCES TO CLASS A STOCK, WHICH WAS AUTOMATICALLY CONVERTED TO
COMMON STOCK ON MARCH 31, 1999, (D) DELETE CERTAIN LIMITATIONS ON
TRANSFERS OF COMMON STOCK WHICH WERE ORIGINALLY DESIGNED TO
PRESERVE NET OPERATING LOSS CARRY FORWARDS OF THE COMPANY, BUT
ARE NOW IRRELEVANT, AND HAVE BEEN LOST AS A RESULT OF THE CHANGE
OF CONTROL TRANSACTION IN DECEMBER, 1998, AND (E) FURTHER
INDEMNIFY THE COMPANY'S DIRECTORS, OFFICERS AND EMPLOYEES AGAINST
COSTS AND EXPENSES RELATING TO THE PERFORMANCE OF THEIR DUTIES.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. TO APPROVE A PLAN OF FINANCING TO RAISE ADDITIONAL FUNDS THROUGH
A PRIVATE PLACEMENT WITH LAWRENCE M. POWERS, THE CHAIRMAN OF THE
BOARD, CHIEF EXECUTIVE OFFICER AND A MAJOR STOCKHOLDER OF THE
COMPANY.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. TO RATIFY THE COMPANY'S 1999 STOCK OPTION PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. TO RATIFY THE APPOINTMENT OF EDWARD ISAACS & COMPANY LLP AS THE
COMPANY'S INDEPENDENT PUBLIC ACCOUNTANT FOR THE COMPANY'S FISCAL
YEAR ENDING MARCH 31, 2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. TO TRANSACT SUCH OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE
ANNUAL MEETING.
This proxy, when properly executed, will be voted in the manner directed hereby
by the undersigned shareholder. Where no direction is made, this proxy will be
voted FOR Proposals 1, 2, 3, 4 and 5. The undersigned hereby revokes any proxy
previously given and acknowledges receipt of the Notice of, and Proxy Statement
for, the aforesaid Meeting.
Dated: ________________________, 1999
_____________________________________
Signature
_____________________________________
Signature
NOTE: Personal representatives, custodians, trustees, partners, corporate
officers, and attorneys-in-fact should add their titles as such.
PLEASE VOTE AND DATE THIS PROXY, SIGNING IT AS YOUR NAME APPEARS ON YOUR STOCK
CERTIFICATES AND RETURN THE PROXY IN THE ENVELOPE PROVIDED.