EXHIBIT 10.2
INTERNET VENTURES Inc
INCENTIVE STOCK OPTION PLAN - 1995
1. Purpose.
The Incentive Stock Option Plan - 1995 is established to aid Internet Ventures,
Inc. (the "Company") to attract, retain and compensate employees, officers and
directors of the Company, its parent or subsidiaries, of outstanding ability by
enabling and encouraging them to acquire stock ownership in the Company. This
plan is intended to comply with the provisions of Rule 701 under the Securities
Act of 1933. For purposes of the Plan, a parent corporation and a subsidiary
corporation shall be as defined in sections 425(e) and 425(f) of the Internal
Revenue Code of 1954, as amended (the "Code").
2 Administration.
The Plan shall be administered by the Board of Directors (the "Board") and/or by
a duly appointed committee of the Board. Any subsequent references to the Board
shall also mean the committee if it has been appointed. All questions of
interpretation of the Plan or of any options granted under the Plan (an
"Option") shall be determined by the Board, and such determinations shall be
final and binding upon all persons having an interest in the Plan and/or any
Option. Options may be either Incentive Stock Options (ISOs) as defined in
section 422A of the Code, or Nonqualified Stock Options (NQSOs). Each type of
option granted to an individual Optionee shall be set forth in a separate option
agreement.
3. Eligibility.
(a) The Options may be granted only to employees (including officers and
Directors), of the Company. The Board shall, in its sole discretion,
determine which persons shall be granted Options (an "Optionee").
Termination of an Optionee's status as a director shall be deemed to be
termination of the Optionee's employment for purposes of applying the
provisions of the Plan. An Optionee may, if he is otherwise eligible, be
granted additional Options.
(b) Any option granted pursuant to this Plan which is intended to be an
incentive stock option as defined in the IRC shall provide that the number
of shares first becoming exercisable in any calendar year pursuant to such
Option and all other options granted pursuant to incentive stock option
plans of the Company shall be limited to that number of Options with an
aggregate Fair Market Value (determined as of the date of grant in
accordance with the provisions of Section 6(a) of this Plan) may not exceed
the sum of $100,000. Options designated as nonqualified stock options shall
not be subject to such limitation.
(c) Optionees owning stock of more than 10% combined voting power of all
classes of stock of the Company (within the meaning of Section 422A(b)(6)
of the Code) shall be eligible for Incentive Stock Options, however, the
exercise price of the ISO granted must be 110% of the fair market value and
shall not be exercisable after five (5) years from the date of grant.
4. Shares Subject to Option.
The maximum number of shares which may be issued under the Plan in any one year
shall be 200,000 shares of the Company's authorized but unissued common stock
plus the sum of (a) the cumulation of one percent (1%) of the voting shares
outstanding at the beginning of each of the Company's fiscal years subsequent to
the adoption of this Plan; (b) the cumulative total of three and one-third
percent (3 1/3%) of any voting stock (common or preferred) issued by the Company
(excludes stock equivalents) in connection with the acquisition of another
company or business entity subsequent to the adoption of this Plan; (c) less the
number of shares actually awarded in all prior years under the Plan; all subject
to adjustment as provided in paragraph 6(f).
The amount of shares subject to the Plan is 200,000 plus one percent (1%) of the
outstanding shares at the beginning of each of the Company's fiscal years plus
three and one-third percent (3 1/3%) of any voting stock issued in connection
with an acquisition of another company or business.
In the event that any outstanding Option for any reason expires or is
terminated, the shares of Common stock allocable to the unexercised portion of
such Option may again be subjected to Option. The Company may grant a Stock
Appreciation Rights "SAR" in tandem with a NQSO, in which case the exercise of
either the option or the SAR reduces the number of shares subject to the other
by a like number of shares.
5. Time for Granting Options.
All options shall be granted, if at all, within ten (10) years from the earlier
of the date the Plan is adopted by the Board or the date the Plan is duly
approved by the stockholders of the Company.
6. Terms, Conditions and Form of Options.
Subject to the provisions of the Plan, the Board shall determine for each Option
(which need not be identical) the number of shares for which the option shall be
granted, the option price of the Option, the exercisability of the Option,
whether the Option is a nonqualified stock option, or an incentive stock option
and all the terms and conditions of the option. Options granted pursuant to this
Plan shall be evidenced by written agreements specifying the number of shares
covered thereby, in such forms as the Board shall from time to time establish,
which agreements may incorporate all or any of the terms of the Plan by
reference and shall comply with and be subject to the following terms and
conditions.
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(a) Option Price. The option price shall be not less than the fair market
value, in the case of an incentive stock option, and not less than fifty
percent (50%) of fair market value, in the case of a non-qualified stock
option, of shares of common stock of the Company on the date the Option is
granted, except in the case of 10% shareholders as set forth in 3(c) above.
The Fair Market Value (FMV) of the common stock shall be the average of the
closing bid and asked prices of the stock as reported by NASDAQ or the
average of the highest bid and lowest offer reported in the OTC market by
the OTC Bulletin Board on the day before the grant date. If not reported by
NASDAQ or OTCBB then the FMV shall be the closing sale price on the stock
exchange on which the stock is traded or on the NASD National Market System
on the day prior to date of grant or other such date which reflects the
last trading date, or if no active market exists then the FMV shall be that
price set by the Board.
(b) Exercise Period of Options. The Board shall have the power to set the time
or times within which each Option shall be exercisable or the event or
events upon the occurrence of which all or a portion of each Option shall
be exercisable and the term of each Option; provided, however, that no
Option shall be exercisable after the expiration of (10) years from the
date such Option is granted.
(c) Exercise of Option.
(i) Options may be exercised only by written notice to the Company,
stating the number of shares being purchased and accompanied by
payment of the option price for the number of shares being purchased
(1) in cash, (2) by tender to the Company of shares of common stock
of the Company which (a) either have been owned by the Optionee for
more than six (6) months or were not acquired directly or indirectly
from the Company, and (b) have a fair market value (defined under
Option Price above) not less than the option price, (3) by
collateralized promissory note(s) or (4) by such other consideration
as the Board may approve prior to the time the Option is exercised.
At the time an Option is exercised, in whole or in part, or at any
time thereafter as requested by the Company, the Optionee shall make
adequate provision for federal and state income tax withholding
obligations of the Company, if any which arise upon exercise, in
whole or in part, of the Option.
(ii) An Option is not exercisable until such time as the Plan is duly
approved by the stockholders of the Company.
(iii) In the event of (1) a merger or consolidation in which the Company is
not the surviving corporation, and/or (2) the sale of all or
substantially all of the Company's assets (other than a sale or
transfer to a subsidiary of the Company as defined in Section 425(f)
of the Code), all outstanding Options, notwithstanding the terms of
such Options, shall become fully exercisable prior to consummation of
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such merger or sale of assets at such time(s) as the Board shall
determine or the surviving or acquiring corporation shall, as a
condition precedent to consummation of said transaction, assume the
outstanding Options or issue substitute incentive stock options (as
defined in the Code) in place thereof in a manner qualifying under
section 425(a) of the Code.
(d) Options Non-Transferable. During the lifetime of the Optionee, the Option
shall be exercised only by said Optionee. No option shall be assignable or
transferable by the Optionee, except by will or by the laws of descent and
distribution. Except as to nonqualified options which may be made
transferable at the option of the Board.
(e) Termination of Options. If an Optionee ceases to be an employee of the
Company for any reason except death or disability, any Option, to the
extent unexercised and exercisable by the Optionee on the date on which the
Optionee ceased to be an employee, may be exercised by the Optionee within
three (3) months after the date on which the Optionee ceases to be an
employee, but in any event no later than the date of expiration of the
Option term. If the Optionee's employment with the Company is terminated
because of the death or disability of the Optionee within the meaning of
Section 105(d)(4) of the Code, any Option, to the extent unexercised and
exercisable by the Optionee on the date Optionee ceased to be employed by
the Company, may be exercised by the Optionee (or the Optionee's legal
representative) at any time prior to the expiration of twelve (12) months
from the date the Optionee ceased to be employed, but in any event no later
than the date of expiration of the Option terms. An Optionee's employment
shall be deemed to have terminated on account of death if the Optionee dies
within three (3) months of the Optionee's termination of employment. Except
as provided in this paragraph 6(e), an Option shall terminate and may not
be exercised after the Optionee ceases to be an employee of the Company.
(f) Effect of Change in Stock Subject to Plan. Appropriate adjustment shall be
made in the number and class of shares of stock subject to this Plan and to
any outstanding Options and in the exercise price of any outstanding
Options in the event of a stock split, reverse stock split or like change
in the capital structure of the Company.
(g) Restriction on Issuance of Shares. The grant of Options and the issuance of
shares shall be subject to compliance with all of the applicable
requirements of the law with respect to such securities, including any
required approval by the Commissioner of Corporations of the State of
California.
(h) Rights as a Stockholder or Employee. No person shall have any rights as a
stockholder with respect to any shares covered by an Option until the date
of the issuance of a stock certificate(s) for the shares for which the
Option has been exercised. No adjustment shall be made for dividends or
distributions or other rights for which the record date is prior to the
date such stock certificate(s) are issued, except as provided in Paragraph
6(f). Nothing in this Plan or in any Option agreement shall confer upon any
Optionee any right to continue in the employ of the Company or interfere in
any way with any right of the
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Company to terminate the Optionee's employment at any time.
(i) Fractional Shares. In no event shall the Company be required to issue
fractional shares upon the exercise of the Option.
(j) Option Exereisability. The exercisability (vesting) of any Option granted
under the Plan shall be determined by the Board; provided that at least 20%
of the shares of stock covered by any Option shall become exercisable as of
the end of each full year of the term of such Option. The right of exercise
shall be cumulative.
7. Termination or Amendment of Plan.
The Board may at any time terminate or amend the Plan, provided that without
approval of stockholders there shall be: (i) no increase in the total number of
shares covered by the Plan (except by operation of the provisions of
subparagraph 6(g) above), and (ii) no change in the class of persons eligible to
receive Options. In any case, no amendment may adversely affect any then
outstanding Options or any unexercised portions thereof without the consent of
Optionee unless such amendment is required to enable the Option to qualify as an
incentive stock option (as defined in the Code).
8. The above constitutes the Company's Incentive Stock Option Plan - 1995.
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INTERNET VENTURES, INC.
Incentive Stock Option Plan - 1995
INCENTIVE STOCK OPTION AGREEMENT
The Board of Directors of Internet Ventures, Inc. (the "Company") desires to
grant to Optionee the ability to participate in the Incentive Stock Option
Plan-1995 (the "Plan"), a copy of which is attached hereto, by granting an
option to purchase shares in the Company as set forth below.
Optionee:
Address:
Date of Grant
Option Shares:
(as may be adjusted as provided for in the Plan).
Exercise Price per Share:
(being the Fair Market Value on the date as provided for in the
Plan).
Option Period:
Exercise of Option (Vesting):
________________________________________
________________________________________
________________________________________
Manner of Exercise: The Optionee shall give written notice to the Company
(Attachment A) specifying the number of shares to be purchased accompanied by
payment in cash, by certified check, upon approval by the Board, his promissory
note (secured by collateral other than the shares acquired), or other shares of
the Company's Common Stock, for the full purchase price. No share shall be
issued until full payment therefor has been made.
Employment: Nothing contained in this Option Agreement shall confer upon the
Optionee any right to be continued in the employment of the Company or shall
prevent the Company from terminating his employment at any time, with or without
cause. If the Optionee's employment
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with the Company is terminated for any reason other than death, this option
shall be exercisable only as to those shares of Common Stock immediately
purchasable by him at the date of termination. In no event shall an option be
exercisable after the termination (date of this agreement.
Death: If the Optionee dies while employed by the Company or within three (3)
months after termination of his employment, that portion of this option which
was exercisable by the Optionee at the time of death may be exercised by his
legal representative or beneficiaries for a period of twelve (12) months from
the date of cessation of employment.
Non-Transferability of Option: This option shall not be transferable other than
by will or by the laws of descent and distribution, and may be exercised during
the Optionee's lifetime only by him.
Incorporation of Plan: The Option granted hereby is subject to, and governed by,
the terms and conditions of the Plan, which are hereby incorporated by
reference. This Agreement, including the Plan incorporated by reference herein,
is the entire agreement among the parties hereto with respect to the subject
matter hereof and supersedes all prior agreements and understandings.
Securities Laws Requirements: No shares shall be issued upon the exercise of any
option unless and until the Company and the Optionee are determined to be in
compliance with applicable State and Federal securities laws with respect to an
individual exercise. The shares issued under the Plan may be restricted
securities subject to limitations on resale.
General: Notice regarding this agreement shall be in writing and shall be
delivered in person or by registered mail to the Company's address.
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The parties have accepted the terms herein and entered into this agreement this
__________ day of ________________, ________.
Company:____________________________
Optionee:___________________________
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NOTICE OF EXERCISE
(to be signed only upon exercise of the Option)
TO: Internet Ventures, Inc.
The undersigned hereby irrevocably elects to purchase ________________ * shares
of Common Stock, par value $.01 per share, of Internet Ventures, Inc. (the
"Company") pursuant to the Stock Option Agreement dated _________________,
_________ between the undersigned and the Company, and herewith encloses
$___________________ to pay the purchase price for the shares.
Date:_____________________, _________
Signature:___________________________
(Signature must conform in all respects to name of the holder as
specified on the face of the Option)
Address:_________________________________
_________________________________
Tax ID Number:___________________________
*Do not make any adjustment for additional Common Stock, other securities or
property which, pursuant to the adjustment provisions of the Option, may be
deliverable upon exercise.
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FIRST AMENDMENT TO THE
INTERNET VENTURES, INC.
1995 INCENTIVE STOCK OPTION PLAN
WHEREAS, Internet Ventures, Inc. (the "Company") has established and
maintains the Internet Ventures, Inc. Incentive Stock Option Plan (the "Plan"),
effective as of October 24, 1995; and
WHEREAS, the Company has determined that it desires to amend the Plan to
reflect certain changes related to the Company becoming a reporting company
under the Securities and Exchange Act of 1934, as amended;
NOW, THEREFORE, BE IT RESOLVED that, pursuant to the power and authority
reserved to the Board of Directors by Section 7 of the Plan, the Plan be and is
hereby amended effective _______ ___, 1999, unless otherwise specified herein,
in the following particulars:
1. Section 2 is amended by deleting the first and second sentences and
replacing them with the following:
"(a) This Plan shall be administered by a Committee (the "Committee") which
shall be comprised of one or more non-employee directors designated by
the Board of Directors (the "Board"). A person shall be considered a
non-employee director for this purpose only if, at the time he
exercises discretion in administering the Plan, he is a non-employee
director within the meaning of Rule 16b-3 under the Exchange Act. In
the absence of a designation, the Board or the portion that qualifies
as the Committee shall be the Committee. Any subsequent references to
the Board shall be deemed to also include the Committee. At any time
the Company is publicly held, this Plan is intended to qualify for
exemption from Section 16(b) of the Exchange Act and to qualify as
performance-based compensation under Section 162(m) of the Code and
shall be interpreted in such a way as to result in such qualification.
A member of the Committee shall not exercise any discretion respecting
himself or herself under this Plan."
2. Section 2 is further amended by adding the following:
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"(b) In the event that the Company becomes a publicly held corporation, the
Board shall appoint a Committee that consists of directors who are
"non-employees" within the meaning of Rule 16b-3 and each of whom is
an "outside" director under Section 162(m) of the Code to administer
the Plan with respect to individuals subject to (or potentially
subject to) such provisions."
3. Section 8 is amended by deleting it in its entirety and replacing it with
the following:
"8. In the event there is an effective registration statement under the
Securities Act pursuant to which shares of Common Stock shall be
offered for sale in an underwritten offering, an Optionee shall not,
during the period requested by the underwriters managing the
registered public offering, effect any public sale or distribution of
shares received directly or indirectly pursuant to an exercise of an
Option, SAR or warrant.
9. In addition to such other rights of indemnification as they may have
and to the extent permitted by law, the Company shall indemnify,
defend and hold harmless the Board, the Committee, the members of the
Committee, the officers of the Company, and any agent or
representative selected by the Board or Committee (collectively
"Indemnified Party") against the reasonable expenses, including,
without limitation, attorneys' fees, actually and necessarily incurred
in connection with the defense of any action, suit or proceeding, or
any threat thereof, or in connection with any appeal therein, to which
they or any of them may be a party by reason of any act or omission in
connection with the Plan or any Option, SAR or warrant granted
thereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by legal counsel selected by the
Company) or paid by them in satisfaction of a judgment in any action,
suit or proceeding, except in relation to matters as to which it shall
be adjudged in such action, suit or proceeding that such Indemnified
Party is liable for gross negligence or gross misconduct in the
performance of his duties; provided that within sixty (60) days after
institution of any such action, suit or proceeding the Indemnified
Party may in writing elect to defend the same at its sole expense, and
if such election is made, the Company shall have no further liability
or obligations to the Indemnified Party under this Section. The
provisions of this Section 9 shall in no way limit any other
obligation or arrangements the Company may have with regard to
indemnifying an Indemnified Party.
10. No liability whatever shall attach to or be incurred by any past,
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present or future stockholders, officers or directors, merely as
such, of the Company under or by reason of any of the terms,
conditions or agreements contained in this Plan, in an option
agreement or implied from either thereof, and any and all
liabilities of, and any and all rights and claims against the
Company, or any shareholder, officer or director, merely as such,
whether arising at common law or in equity or created by statute
or constitution or otherwise, pertaining to this Plan or to an
option agreement, are hereby expressly waived and released by
every Optionee as a part of the consideration for any benefits
provided by the Company under this Plan. A person who shall claim
a right or benefit under this Plan shall be entitled only to
claim against the Company for such benefit.
11. With respect to persons subject to Section 16 of the Exchange
Act, transactions under this Plan are intended to comply with all
applicable conditions of Rule 16b-3. To the extent any provision
of the Plan or action by the Committee fails to so comply, it
shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Committee. Moreover, in the event the
Plan does not include a provision required by Rule 16b-3 to be
stated herein, such provision (other than one relating to
eligibility requirements or the price and amount of Awards) shall
be deemed to be incorporated by reference into the Plan with
respect to Optionees subject to Section 16.
12. If at the time an Optionee incurs a termination of employment
(other than due to cause) or if at the time of a change in
control, the Optionee is subject to "short-swing" liability under
Section 16 of the Exchange Act, any time period provided for
under this Plan or an option agreement to the extent necessary to
avoid the imposition of liability shall be suspended and delayed
during the period the Optionee would be subject to such
liability, but not more than six (6) months and one (1) day and
not to exceed the option period, whichever is shorter. The
Company shall have the right to suspend or delay any time period
described in this Plan or an option agreement if the Committee
shall determine that the action may constitute a violation of any
law or result in liability under any law to the Company, an
affiliate or a stockholder of the Company until such time as the
action required or permitted shall not constitute a violation of
law or result in liability to the Company, an affiliate or a
stockholder of the Company. The Committee shall have the
discretion to suspend the application of the provisions of this
Plan required solely to comply with Rule 16b-3 if the Committee
shall determine that Rule 16b-3 does not apply to this Plan.
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13. This Plan and the option agreement constitute the entire
agreement with respect to the subject matter hereof and thereof,
provided that in the event of any inconsistency between this Plan
and the option agreement, the terms and conditions of the option
agreement shall control."
Except as provided herein, the Plan shall remain in full force and
effect.
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IN WITNESS WHEREOF, the Company has caused this amendment to be executed as
of _________, 1999.
INTERNET VENTURES, INC.
By: /s/ Donald A. Janke
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Donald A. Janke
/s/ Marshall F. Sparks
------------------------------------------
Marshall F. Sparks
/s/ Daniel R. DiMicco
------------------------------------------
Daniel R. DiMicco
/s/ Alfred M. Leopold
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Alfred M. Leopold
Being all the directors of the Company