EXHIBIT 10.1A
COMPUTER TELEPHONE CORP.
1993 STOCK OPTION PLAN
I. Purposes of the Plan. The purposes of this Stock Option Plan are to
attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to the Employees and
Consultants of the Company and to promote the success of the Company's
business.
Options granted hereunder may be either "incentive stock options," as
defined in Section 422 of the Internal Revenue Code of 1986, as amended, or
"nonqualified stock options," at the discretion of the Board and as reflected
in the terms of the written option agreement. In addition, shares of the
Company's Common Stock may be Sold hereunder independent of any Option grant.
II. Definitions. As used herein, the following definitions shall apply:
A. "Board" shall mean the Committee, if one has been appointed, or the
Board of Directors of the Company, if no Committee is appointed.
B. "Code" shall mean the Internal Revenue Code of 1986, as amended.
C. "Common Stock" shall mean the Common Stock of the Company.
D. "Company" shall mean COMPUTER TELEPHONE CORP., a Massachusetts
corporation.
E. "Committee" shall mean the Committee appointed by the Board of
Directors in accordance with Section IV, Paragraph A1 of the Plan, if one is
appointed.
F. "Consultant" shall mean any person who is engaged by the Company
or any Subsidiary to render consulting services and is compensated for such
consulting services and any director of the Company whether compensated for
such services or not.
G. "Continuous Status as an Employee or Consultant" shall mean the
absence of any interruption or termination of service as an Employee or
Consultant. Continuous Status as an Employee or Consultant shall not be
considered interrupted in the case of sick leave, military leave, or any other
leave of absence approved by the Board; provided, however, that such leave is
for a period of not more than ninety (90) days or reemployment upon the
expiration of such leave is guaranteed by contract or statute.
H. "Employee" shall mean any person, including officers and directors,
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a director's fee by the Company shall not be sufficient to constitute
"employment" by the Company.
I. "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
J. "Incentive Stock Option" shall mean an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.
K. "Nonqualified Stock Option" shall mean an Option not intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.
L. "Option" shall mean a stock option granted pursuant to the Plan.
M. "Optioned Stock" shall mean the Common Stock subject to an Option.
N. "Optionee" shall mean an Employee or Consultant who receives an
Option.
O. "Parent" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
P. "Plan" shall mean this Stock Option Plan.
Q. "Sale" or "Sold" shall include, with respect to the sale of Shares
under the Plan, the sale of Shares for consideration in the form of cash or
notes, as well as a grant of Shares without consideration, except past or
future services.
R. "Share" shall mean a share of the Common Stock, as adjusted in
accordance with Section XI of the Plan.
S. "Subsidiary" shall mean a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
III. Stock Subject to the Plan. Subject to the provisions of Section XI of
the Plan, the maximum aggregate number of Shares which may be optioned and/or
Sold under the Plan is 750,000 shares of Common Stock. The Shares may be
authorized, but unissued, or reacquired Common Stock.
If an Option should expire or become unexercisable for any reason without
having been exercised in full, the unpurchased Shares which were subject
thereto shall, unless the Plan shall have been terminated, become available for
future Option grants and/or Sales under the Plan. If Shares Sold under the Plan
or purchased upon the exercise of an Option are repurchased by the Company
pursuant to restrictions applicable to such Shares, the number of Shares
repurchased shall, unless the Plan shall have been terminated, become available
for future Option grants and/or Sales under the Plan.
IV. Administration of the Plan.
A. Procedure. The Plan shall be administered by the Board of
Directors of the Company.
1. Subject to Paragraph A2 of this Section IV, the Board of
Directors may appoint a Committee consisting of not less than two (2) members
of the Board of Directors to administer the Plan on behalf of the Board of
Directors, subject to such terms and conditions as the Board of Directors may
prescribe. Once appointed, the Committee shall continue to serve until
otherwise directed by the Board of Directors. From time to time the Board of
Directors may increase the size of the Committee and appoint additional members
thereof, remove members (with or without cause) and appoint new members in
substitution therefor, fill vacancies however caused, or remove all members of
the Committee and thereafter directly administer the Plan.
Members of the Board who are either eligible for Options
and/or Sales or have been granted Options or Sold Shares may vote on any
matters affecting the administration of the Plan or the grant of any Options
or Sale of any Shares pursuant to the Plan, except that no such member shall
act upon the granting of an Option or Sale of Shares to himself, but any such
member may be counted in determining the existence of a quorum at any meeting
of the Board during which action is taken with respect to the granting of
Options or Sale of Shares to him.
2. Notwithstanding the foregoing Paragraph A1 of this Section
IV, if and in any event the Company registers any class of any equity security
pursuant to Section 12 of the Securities Exchange Act of 1934, from the
effective date of such registration until six (6) months after the termination
of such registration, any grants of Options to officers or directors shall only
be made by the Board if each member of the Board is a disinterested person, or
if every member of the Board is not a disinterested person, by a committee of
two or more directors, each of whom is a disinterested person. A "disinterested
person" is a director who has not, during the one year period prior to service
as an administrator of the Plan, or during such service, been granted or
awarded equity securities pursuant to the Plan or any other plan of the Company
or any of its affiliates, with these qualifications:
a. participation in a formula plan meeting the conditions
in paragraph (c)(2)(ii) of SEC Rule 16b-3 shall not
disqualify a director from being a disinterested person;
b. participation in an ongoing securities acquisition plan
meeting the conditions in paragraph (d)(2)(i) of SEC Rule
16b-3 shall not disqualify a director from being a
disinterested person;
c. an election to receive an annual retainer fee in either
cash or an equivalent amount of securities, or partly in cash
and partly in securities, shall not disqualify a director
from being a disinterested person; and
d. participation in a plan shall not disqualify a director
from being a disinterested person for the purpose of
administering another plan that does not permit participation
by directors.
B. Powers of the Board. Subject to the provisions of the Plan, the
Board shall have the authority, in its discretion:
1. to grant Incentive Stock Options in accordance with Section
422 of the Code, or Nonqualified Stock Options;
2. to authorize Sales of Shares of Common Stock hereunder;
3. to determine, upon review of relevant information and in
accordance with Section VIII, Paragraph B of the Plan, the fair market value
of the Common Stock;
4. to determine the exercise/purchase price per Share of Options
to be granted or Shares to be Sold, which exercise/purchase price shall be
determined in accordance with Section VIII, Paragraph A of the Plan;
5. to determine the Employees or Consultants to whom, and the
time or times at which, Options shall be granted and the number of Shares to
be represented by each Option;
6. to determine the Employees or Consultants to whom, and the
time or times at which, Shares shall be Sold and the number of Shares to be
Sold;
7. to interpret the Plan;
8. to prescribe, amend and rescind rules and regulations
relating to the Plan;
9. to determine the terms and provisions of each Option granted
(which need not be identical) and, with the consent of the holder thereof,
modify or amend each Option;
10. to determine the terms and provisions of each Sale of Shares
(which need not be identical) and, with the consent of the purchaser thereof,
modify or amend each Sale;
11. to accelerate or defer (with the consent of the Optionee) the
exercise date of any Option;
12. to accelerate or defer (with the consent of the Optionee or
purchaser of Shares) the vesting restrictions applicable to Shares Sold under
the Plan or pursuant to Options granted under the Plan;
13. to authorize any person to execute on behalf of the Company
any instrument required to effectuate the grant of an Option or Sale of Shares
previously granted or authorized by the Board;
14. to determine the restrictions on transfer, vesting
restrictions, repurchase rights, or other restrictions applicable to Shares
issued under the Plan;
15. to effect, at any time and from time to time, with the
consent of the affected Optionees, the cancellation of any or all outstanding
Options under the Plan and to grant in substitution therefor new Options under
the Plan covering the same or different numbers of Shares, but having an Option
price per Share consistent with the provisions of Section VIII of this Plan as
of the date of the new Option grant;
16. to establish, on a case-by-case basis, different terms and
conditions pertaining to exercise or vesting rights upon termination of
employment, whether at the time of an Option grant or Sale of Shares, or
thereafter; and
17. to make all other determinations deemed necessary or
advisable for the administration of the Plan.
C. Effect of Board's Decision. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees and
any other holders of any Options granted under the Plan or Shares Sold under
the Plan.
V. Eligibility.
A. Persons Eligible. Options may be granted and/or Shares Sold only
to Employees and Consultants. Incentive Stock Options may be granted only to
Employees. An Employee or Consultant who has been granted an Option or Sold
Shares may, if he is otherwise eligible, be granted an additional Option or
Options or Sold additional Shares.
B. $100,000 Limitation. No Incentive Stock Option may be granted to
an Employee which, when aggregated with all other Incentive Stock Options
granted to such Employee by the Company or any Parent or Subsidiary, would
result in Shares having an aggregate fair market value (determined for each
Share as of the date of grant of the Option covering such Share) in excess of
$100,000 becoming first available for purchase upon exercise of one or more
Incentive Stock Options during any calendar year.
C. Section V, Paragraph B Limitations. Section V, Paragraph B of the
Plan shall apply only to an Incentive Stock Option evidenced by an "Incentive
Stock Option Agreement" which sets forth the intention of the Company and the
Optionee that such Option shall qualify as an Incentive Stock Option. Section
V, Paragraph B of the Plan shall not apply to any Option evidenced by a
"Nonqualified Stock Option Agreement" which sets forth the intention of the
Company and the Optionee that such Option shall be a Nonqualified Stock Option.
D. No Right to Continued Employment. The Plan shall not confer upon
any Optionee any right with respect to continuation of employment or consulting
relationship with the Company, nor shall it interfere in any way with his right
or the Company's right to terminate his employment or consulting relationship
at any time.
VI Term of Plan. The Plan shall become effective upon the earlier to occur
of its adoption by the Board of Directors or its approval by the stockholders
of the Company as described in Section XVII of the Plan. It shall continue in
effect for a term of ten (10) years, unless sooner terminated under Section
XIII of the Plan.
VII. Term of Option. The term of each Incentive Stock Option shall be ten
(10) years from the date of grant thereof or such shorter term as may be
provided in the Stock Option Agreement. The term of each Nonqualified Stock
Option shall be ten (10) years and one (1) day from the date of grant thereof
or such other term as may be provided in the Stock Option Agreement. However,
in the case of an Option granted to an Optionee who, at the time the Option is
granted, owns stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Company or any Parent or Subsidiary, (a)
if the Option is an Incentive Stock Option, the term of the Option shall be
five (5) years from the date of grant thereof or such shorter time as may be
provided in the Stock Option Agreement, or (b) if the Option is a Nonqualified
Stock Option, the term of the Option shall be five (5) years and one (1) day
from the date of grant thereof or such other term as may be provided in the
Stock Option Agreement.
VIII. Exercise/Purchase Price and Consideration.
A. Exercise/Purchase Price. The per-Share exercise/purchase price for
the Shares to be issued pursuant to exercise of an Option or a Sale (other than
a Sale which is a grant for which no purchase price is payable) shall be such
price as is determined by the Board, but shall be subject to the following:
1. In the case of an Incentive Stock Option
a. granted to an Employee who, at the time of the grant
of such Incentive Stock Option, owns stock representing more
than ten percent (10%) of the voting power of all classes of
stock of the Company or any Parent or Subsidiary, the per
Share exercise price shall be no less than one hundred ten
percent (110%) of the fair market value per Share on the date
of the grant.
b. granted to any other Employee, the per Share exercise
price shall be no less than one hundred percent (100%) of the
fair market value per Share on the date of grant.
2. In the case of a Nonqualified Stock Option or Sale
a. granted or Sold to a person who, at the time of the
grant of such Option or authorization of such Sale, owns
stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise/purchase price shall
be no less than one hundred ten percent (110%) of the fair
market value per Share on the date of the grant or
authorization of Sale, unless otherwise expressly determined
by the Board of Directors.
b. granted or sold to any other person, the per Share
exercise/purchase price shall be no less than eighty-five
percent (85%) of the fair market value per Share on the date
of grant or authorization of Sale, unless otherwise expressly
determined by the Board of Directors.
c. Any determination to sell stock at less than fair
market value on the date of the grant or authorization of
Sale shall be accompanied by an express finding by the Board
of Directors specifying that the sale is in the best interest
of the Company, and specifying both the fair market value and
the grant or sale price of the stock.
3. In the case of an Option granted or Sale authorized on or
after the effective date of registration of any class of equity security of the
Company pursuant to Section 12 of the Exchange Act and prior to six (6) months
after the termination of such registration, the per Share exercise/purchase
price shall be no less than one hundred percent (100%) of the fair market value
per Share on the date of grant or authorization of Sale.
B. Fair Market Value. The fair market value per Share shall be
determined by the Board in its discretion, said fair market value to be
determined in good faith at the time of the grant of such Option by the Board;
provided, however, that where there is a public market for the Common Stock,
the fair market value per Share shall be the closing price of the Common Stock
for the date of grant or authorization of Sale, as reported in The Wall Street
Journal (or, if not so reported, as otherwise reported by the National
Association of Securities Dealers Automated Quotation (NASDAQ) System) or, in
the event the Common Stock is listed on a stock exchange, the fair market value
per Share shall be the closing price on such exchange on the date of grant of
the Option or authorization of Sale, as reported in The Wall Street Journal.
C. Consideration. The consideration to be paid for the Shares to be
issued upon exercise of an Option or pursuant to a Sale, including the method
of payment, shall be determined by the Board and may consist in whole or part
of:
1. cash;
2. check;
3. promissory note;
4. transfer to the Company of Shares having a Fair Market Value
at the time of such exercise equal to the Option exercise price; or
5. delivery of instructions to the Compa4.any to withhold from
the Shares that would otherwise be issued on the exercise that number of Shares
having a Fair Market Value at the time of such exercise equal to the Option
exercise price.
If the Fair Market Value of the number of whole Shares transferred
or the number of whole Shares surrendered is less than the total exercise price
of the Option, the shortfall must be made up in cash or by check.
IX. Exercise of Option.
A. Procedure for Exercise: Rights as a Stockholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Board, including performance criteria with respect to the
Company and/or the Optionee, and as shall be permissible under the terms of the
Plan.
An Option may not be exercised for a fraction of a Share.
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 by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Board, consist of any
consideration and method of payment allowable under Section VIII, Paragraph C
of the Plan. Each Optionee who exercises an Option shall, upon notification of
the amount due (if any) and prior to or concurrent with delivery of the
certificate representing the Shares, pay to the Company amounts necessary to
satisfy applicable federal, state and local tax withholding requirements. An
Optionee must also provide a duly executed copy of any stock transfer agreement
then in effect and determined to be applicable by the Board. Until the issuance
(as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. No adjustment will be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section XI of the Plan.
Exercise of an Option in any manner shall result in a decrease in
the number of Shares which thereafter may be available, both for purposes of
the Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
B. Termination of Status as an Employee or Consultant. If an Employee
or Consultant ceases to serve as an Employee or Consultant (as the case may
be), he may, but only within three (3) months (or such other period of time not
exceeding the limitations of Section VII above as is determined by the Board
at the time of grant of an Option or thereafter) after the date he ceases to
be an Employee or Consultant (as the case may be) of the Company, exercise his
Option to the extent that he was entitled to exercise it at the date of such
termination. To the extent that he was not entitled to exercise the Option at
the date of such termination, or if he does not exercise such Option (which he
was entitled to exercise) within the time specified herein, the Option shall
terminate.
C. Disability of Optionee. Notwithstanding the provisions of
Paragraph B of this Section IX above, in the event an Employee or Consultant
is unable to continue his employment or consulting relationship (as the case
may be) with the Company as a result of his total and permanent disability (as
defined in Section 22(e)(3) of the Code), he may, but only within twelve (12)
months (or such other period of time not exceeding the limitations of Section
VII above as is determined by the Board at the time of grant of an Option or
thereafter) from the date of termination, exercise his Option to the extent he
was entitled to exercise it at the date of such termination. To the extent that
he was not entitled to exercise the Option at the date of termination, or if
he does not exercise such Option (which he was entitled to exercise) within the
time specified herein, the Option shall terminate.
D. Death of Optionee. In the event of the death of an Optionee during
the term of the Option who is at the time of his death an Employee or
Consultant of the Company and who shall have been in Continuous Status as an
Employee or Consultant since the date of grant of the Option, the Option may
be exercised, at any time within twelve (12) months (or such other period of
time not exceeding the limitations of Section VII above as is determined by the
Board at the time of grant of an Option or thereafter) following the date of
death, by the Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent of the
right to exercise as of the date of death.
X. Nontransferability of Options. An Option may not be sold, pledged,
assigned, hypothecated, transferred or disposed of in any manner other than by
will, or by the laws of descent and distribution, and may be exercised during
the lifetime of the Optionee only by the Optionee or, if incapacitated, by his
or her legal guardian or legal representative.
XI. Adjustments Upon Changes in Capitalization or Merger. Subject to any
required action by the stockholders of the Company, the number of shares of
Common Stock covered by each outstanding Option and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options have yet been granted or Sales made or which have been
returned to the Plan upon cancellation or expiration of an Option, as well as
the price per share of Common Stock covered by each such outstanding Option,
shall be proportionately adjusted for any increase or decrease in the number
of issued shares of Common Stock resulting from a stock split, reverse stock
split, stock dividend, combination or reclassification of the Common Stock, or
any other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be
deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein,
no issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
of Common Stock subject to an Option.
In the event of the proposed dissolution or liquidation of the Company,
the Option will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board. The Board may, in the
exercise of its sole discretion in such instances, declare that any Option
shall terminate as of a date fixed by the Board and give each Optionee the
right to exercise his Option as to all or any part of the Optioned Stock,
including Shares as to which the Option would not otherwise be exercisable. In
the event of a proposed sale of all or substantially all of the assets of the
Company, or the merger of the Company with or into another corporation, the
Option shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Board determines, in the exercise of its sole discretion and in lieu
of such assumption or substitution, that the Optionee shall have the right to
exercise the Option as to all of the Optioned Stock, including Shares as to
which the Option would not otherwise be exercisable. If the Board makes an
Option fully exercisable in lieu of assumption or substitution in the event of
a merger or sale of assets, the Board shall notify the Optionee that the Option
shall be fully exercisable for a period of thirty (30) days from the date of
such notice or such shorter period as the Board may specify in the notice, and
the Option will terminate upon the expiration of such period.
XII. Time of Granting Options. The date of grant of an Option shall, for all
purposes, be the date on which the Board makes the determination granting such
Option. Notice of the determination shall be given to each Employee or
Consultant to whom an Option is so granted within a reasonable time after the
date of such grant.
XIII.Amendment and Termination of the Plan.
A. Amendment and Termination. The Board may amend or terminate the
Plan from time to time in such respects as the Board may deem advisable;
provided, however, that if required to qualify the Plan under Rule 16b-3
promulgated under Section 16 of the Securities Exchange Act of 1934, as
amended, no amendment shall be made more than once every six months that would
change the amount, price or timing of the option grants, other than to comport
with changes in the Code, or the rules and regulations promulgated thereunder;
and provided, further, that, if required to qualify the Plan under Rule 16b-3,
no amendment shall be made without the approval of the stockholders of the
Company in the manner described in Section XVII of the Plan if the amendment
would:
1. increase the number of Shares subject to the Plan, other than
in connection with an adjustment under Section XI of the Plan;
2. make a change in the designation of the class of Employees
or Consultants eligible to be granted Options; or
3. if the Company has a class of equity security registered
under Section 12 of the Exchange Act at the time of such revision or amendment,
cause any material increase in the benefits accruing to participants under the
Plan.
B. Stockholder Approval. If any amendment requiring stockholder
approval under Section XIII, Paragraph A of the Plan is made subsequent to the
first registration of any class of equity security by the Company under Section
12 of the Exchange Act, such stockholder approval shall be solicited as
described in Section XVII, Paragraph A of the Plan.
C. Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted, and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee
and the Board, which agreement must be in writing and signed by the Optionee
and the Company.
XIV. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option or a Sale unless the exercise of such Option or
consummation of the Sale and the issuance and delivery of such Shares pursuant
thereto shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended, applicable state securities
laws, the Exchange Act, the rules and regulations promulgated thereunder, and
the requirements of any stock exchange (including NASDAQ) upon which the Shares
may then be listed, and shall be further subject to the approval of counsel for
the Company with respect to such compliance.
As a condition to the exercise of an Option or a Sale, the Company may
require the person exercising such Option or to whom Shares are being Sold to
represent and warrant at the time of any such exercise or Sale that the Shares
are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company,
such a representation is required by any of the aforementioned relevant
provisions of law.
XV. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
Inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.
XVI. Option Agreement. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
XVII. Stockholder Approval. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve months before or
after the date the Plan is adopted. if such stockholder approval is obtained
at a duly held stockholders' meeting, it may be obtained by the affirmative
vote of the holders of a majority of the outstanding shares of the Company,
such holders being present or represented and entitled to vote thereon. If and
in the event that the Company registers any class of any equity security
pursuant to Section 12 of the Exchange Act, the approval of such stockholders
of the Company shall be:
A. Solicitation.
1. solicited substantially in accordance with Section 14(a) of
the Exchange Act and the rules and regulations promulgated thereunder, or
2. solicited after the Company has furnished in writing to the
holders entitled to vote substantially the same information concerning the Plan
as that which would be required by the rules and regulations in effect under
Section 14(a) of the Exchange Act at the time such information is furnished;
and
B. Time. Obtained at or prior to the first annual meeting of
stockholders held subsequent to the first registration of any class of equity
securities of the Company under Section 12 of the Exchange Act.
If such stockholder approval is obtained by written consent, it
must be obtained by the written consent of stockholders of the Company in
compliance with the requirements of applicable state law.
XVIII. Six Month Holding Period for Affiliates. If the Company registers
any class of any equity security pursuant to Section 12 of the Exchange Act,
then from the effective date of such registration until six (6) months after
the termination of such registration (the "Public Period"), these limits will
apply to each officer, director and beneficial owner of ten percent (10%) or
more of any class of equity securities of the Company ("Affiliates"). During
the Public Period, any Affiliate shall hold Shares Sold hereunder at least six
months from the date of Sale. During the Public Period, at least six months
must elapse from the date of grant of an Option to an Affiliate to the date the
Affiliate disposes of the Shares acquired upon exercise of the Option, or (if
the Option is disposed of other than by exercise) to the date of disposition
of the Option itself.