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EXHIBIT 4
U.S. TECHNOLOGIES INC.
1999 STOCK OPTION PLAN
1. PURPOSE
The purpose of the U.S. Technologies Inc. Stock Option Plan (the "Stock
Option Plan") is to encourage and enable eligible directors, officers and key
employees of U.S. Technologies Inc. (the "Company") and its subsidiaries to
acquire proprietary interests in the Company, through the ownership of Common
Stock of the Company (the "Stock"). The Company believes that directors,
officers and key employees who participate in the Stock Option Plan will have a
closer identification with the Company by virtue of their ability as
shareholders to participate in the growth and earnings of the Company. The Plan
also is designed to provide motivation for participating directors, officers and
key employees to remain in the employ of and to give greater effort on behalf of
the Company and its subsidiaries. It is the intention of the Company that the
Stock Option Plan provide for the award of incentive stock options (the
"Qualified Options") qualified under Section 422 of the Internal Revenue Code of
1986, as amended (the "Code") and the regulations promulgated thereunder, as
well as the award of non-qualified stock options (the "Non-Qualified Options").
Accordingly, the provisions of the Stock Option Plan relating to the Qualified
Options shall be construed so as to extend and limit participation in a manner
consistent with the requirements of Section 422 of the Code.
2. DEFINITIONS
The following words or terms shall have the following meanings.
(a) "Agreement" shall mean a stock option agreement between the
Company and an Eligible Employee or Eligible Participant pursuant to the
terms of this Plan.
(b) "Board of Directors" shall mean the Board of Directors of the
Company.
(c) "Committee" shall mean the committee appointed by the Board
of Directors for the purpose of administering the Stock Option Plan,
which committee shall at all times consist of two or more Non-Employee
Directors.
(d) "Company" shall mean U.S. Technologies Inc., a corporation
chartered under the laws of the State of Delaware.
(e) "Eligible Employee(s)" shall mean key employees regularly
employed by the Company or a Subsidiary (including officers, whether or
not they
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are directors) as the Board of Directors or the Committee shall select
from time to time.
(f) "Eligible Participant(s)" shall mean an Eligible Employee, a
Non-Employee Director or consultants or advisors who are not employees
of the Company or a Subsidiary but who are providing actual services to
the Company or a Subsidiary.
(g) "Market Price" shall mean the fair market value of the
Company's Common Stock as determined by the Board of Directors or the
Committee, acting in good faith, under any method consistent with the
Code, or Treasury Regulations thereunder, which the Board of Directors
or the Committee shall in its discretion select and apply at the time of
the grant of the option concerned. Subject to the foregoing, the Board
of Directors or the Committee, in fixing the market price, shall have
full authority and discretion and be fully protected in doing so.
(h) "Non-Employee Director(s)" means a member of the Board of
Directors or a member of the board of directors of a Subsidiary, in each
case, who is not a regular salaries employee of the Company or one of
its Subsidiaries. As it related to members of the Committee as such term
is defined in this Section 2 and for the purpose of Section 9 of the
Stock Option Plan, "Non-Employee Director" shall have the meaning set
forth in Rule 16(b)-3(b)(3) under the Securities Exchange Act of 1934,
as amended.
(i) "Optionee" shall mean an Eligible Employee or Eligible
Participant having a right to purchase Common Stock pursuant to the
Stock Option Plan.
(j) "Option(s) shall mean the right or rights granted to Eligible
Employees or Eligible Participants to purchase Common Stock under the
Stock Option Plan.
(k) "Permanent and total disability" shall be as defined in
Section 22(3)(3) of the Code.
(l) "Plan" shall mean this U.S. Technologies Inc. 1999
Stock Option Plan.
(m) "Shares," "Stock" or "Common Stock" shall mean shares of the
$.02 par value common stock of the Company.
(n) "Subsidiary" shall mean any corporation, if the Company owns
or controls, directly or indirectly, a majority of the voting stock of
such corporation.
(o) "Ten Percent Owner" shall mean an individual who, at the time
an Option is granted, owns directly or indirectly (under the ownership
attribution rules of Code Section 424(d)) more than ten percent (10%)
of the total combined voting power of all classes of stock of the
Company or a Subsidiary.
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3. EFFECTIVE DATE
The effective date of the Stock Option Plan (the "Effective Date") shall
be the date the Stock Option Plan is adopted by the Board of Directors or the
date the Stock Option Plan is approved by the shareholders of the Company,
whichever is earlier. The Stock Option Plan must be approved by the affirmative
vote of not less than a majority of the Shares entitled to vote at a meeting at
which a quorum is present, which shareholder vote must be taken within twelve
months after the date the Stock Option Plan is adopted by the Board of
Directors. Such shareholder vote shall not alter the Effective Date of the Stock
Option Plan. In the event shareholder approval of the adoption of the Stock
Option Plan is not obtained within the aforesaid twelve-month period, then any
Options granted in the intervening period shall be non-qualified stock options
and not entitled to incentive stock option treatment under the provisions of
Section 422 of the Code.
4. SHARES RESERVED FOR PLAN
The Common Stock to be sold to Eligible Participants under the Stock
Option Plan may at the election of the Board of Directors be either treasury
shares or Shares originally issued for such purpose. The maximum number of
Shares which shall be reserved and made available for sale under the Stock
Option Plan shall be 3,115,000; provided, however, that such Shares shall be
subject to the adjustments provided in Section 8(h). Any Shares subject to an
Option which for any reason expires or is terminated unexercised may again be
subject to an Option under the Stock Option Plan.
5. ADMINISTRATION OF THE STOCK OPTION PLAN
The Stock Option Plan shall be administered by the Board of Directors or
the Committee.
Within the limitations described herein and except as otherwise provided
in the Stock Option Plan, the Board of Directors or the Committee shall
administer the Stock Option Plan, select the Eligible Participants to whom
Options will be granted, determine the number of shares of Stock to be optioned
to each Eligible Participant and interpret, construe and implement the
provisions of the Stock Option Plan. The Board of Directors or the Committee
shall also determine the price to be paid for the shares of Stock upon exercise
of each Option, the period within which each Option may be exercised and the
terms and conditions, consistent with the terms of the Stock Option Plan, of
each Option granted pursuant to the Stock Option Plan. The Board of Directors
and Committee members shall be reimbursed for out-of-pocket expenses reasonably
incurred in the administration of the Stock Option Plan.
If the Stock Option Plan is administered by the Board of Directors, a
majority of the members of the Board of Directors shall constitute a quorum, and
the act of a majority of the members of the Board of Directors present at any
meeting at which a quorum is present, or acts approved in writing by all members
of the Board of Directors shall be the acts of the Board of Directors. If the
Stock Option Plan is administered by the Committee, a majority of the members of
the Committee shall constitute a quorum, and the acts of a majority of the
members present
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at any meeting at which a quorum is present, or acts approved in writing by all
the members of the Committee shall be the acts of the Committee.
6. ELIGIBILITY
Options granted pursuant to Section 8 shall be granted only to Eligible
Employees. Options granted pursuant to Section 9 may be granted to Eligible
Participants.
7. DURATION OF THE STOCK OPTION PLAN
The Stock Option Plan shall expire on the tenth anniversary of the
Effective Date, but with respect to Options granted hereunder prior to such
date, shall remain in effect until all Shares subject to or which may become
subject to the Stock Option Plan shall have been purchased pursuant to such
Options; provided that Options under the Stock Option Plan must be granted
within ten years from the Effective Date.
8. QUALIFIED INCENTIVE STOCK OPTIONS
It is intended that Options granted under this Section 8 shall be
"qualified incentive stock options" as defined under the provisions of Section
422 of the Code and the regulations thereunder or corresponding provisions of
subsequent revenue laws and regulations in effect at the time such Options are
granted. Such options shall be evidenced by Agreements in such form and not
inconsistent with this Plan as the Committee or the Board of Directors shall
approve from time to time, which Agreements shall contain in substance the
following terms and conditions:
(a) Number of Shares. The purchase price for shares of Stock
purchased upon exercise will be equal to 100% of the Market Price on the
day the Option is granted, as determined by the Board of Directors or
the Committee; provided that the purchase price of Stock deliverable
upon the exercise of a qualified incentive stock option granted to a Ten
Percent Owner shall be not less than one hundred ten percent (110%) of
the Market Price on the day the Option is granted, as determined by the
Board of Directors or the Committee, but in no case less than the par
value of such shares of Stock.
(b) Number of Shares. The Agreement shall specify the number of
shares of Stock which the Optionee may purchase under such Option.
(c) Exercise of Options. The Shares subject to the Option may be
purchased in whole or in part by the Optionee in accordance with the
terms of the Agreement, from time to time after shareholder approval of
the Stock Option Plan, but in no event later than ten years from the
date of grant of the Option. Notwithstanding the foregoing, shares of
Stock subject to an Option grated to a Ten Percent Owner shall be
exercisable no later than five years from the date of grant of the
Option.
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(d) Medium and time of Payment. Shares of Stock purchased
pursuant to an Agreement shall be paid for in full at the time of
purchase. Payment of the purchase price shall be in cash. Upon receipt
of payment, the Company shall, without transfer or issue tax, deliver to
the Optionee (or other person entitled to exercise the Option) a
certificate or certificates for such shares of Stock.
(e) Rights as a Shareholder. An Optionee shall have no rights as
a shareholder with respect to any shares of Stock covered by an Option
until the date of issuance of the stock certificate to the Optionee for
such shares of Stock. Except as otherwise expressly provided in the
Stock Option Plan, no adjustments shall be made for dividends (ordinary
or extraordinary, whether in cash, securities or other property) or
distributions or other rights for which the record date is prior to the
date such stock certificates is issued.
(f) Non-assignability of Option. No Option shall be assignable or
transferable by the Optionee except by will or by the laws of descent
and distribution. During the lifetime of the Optionee, the Option shall
be exercisable only by him or her.
(g) Effect of Termination of Employment or Death. In the event
that an Optionee during his or her lifetime ceases to be an employee of
the Company or of a Subsidiary for any reason (including retirement)
other than death or permanent and total disability, any Option or
unexercised portion thereof which was otherwise exercisable on the date
of termination of employment shall expire 90 days from the date of such
termination, but in no event after the term provided in the Optionee's
Agreement; provided, however, that if such Optionee is also a director
of the Company, or a Subsidiary at the time of cessation of employment,
the termination of the employment of the Optionee will be deemed to have
occurred only upon the Optionee's resignation or retirement as a
director of the Company or Subsidiary. In the event than an Optionee
ceases to be an employee of the Company or a Subsidiary for an reason
(including retirement) other than death or permanent and total
disability prior to the time than an Option or portion thereof becomes
exercisable, such Option or portion thereof which is not then
exercisable shall terminate and be null and void. Whether authorized
leave of absence for military or government service shall constitute
termination of employment for the purpose of this Plan shall be
determined by the Board of Directors or the Committee, which
determination shall be final and conclusive.
In the event that an Optionee ceases to be an employee of the Company or
a Subsidiary by reason of death or permanent and total disability, any Option or
unexercised portion thereof which was otherwise exercisable on the date such
Optionee ceased employment shall expire unless exercised within a period of one
year from the date on which the Optionee ceased to be an employee, but in no
event after the term provided in the Optionee's agreement. In the event that an
Optionee ceases to be an employee of the Company or a Subsidiary by reason of
death or permanent and total disability, any Option or portion thereof which was
not exercisable on the date such Optionee ceased employment shall become
immediately exercisable for a period of one
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year from the date on which the Optionee ceased to be an employee, but in no
event after the term provided in the Optionee's Agreement.
In the event of the death of an Optionee, the Option shall be exercised
by his or her personal representatives, heirs or legatees, as provided herein.
(h) Recapitalization. In the event that dividends are payable in
Common Stock of the Company or in the event there are splits,
subdivisions or combinations of the Common Stock, the number of shares
of Stock available under the Stock Option Plan shall be increased or
decreased proportionately, as the case may be, and the number of shares
of Stock deliverable upon the exercise thereafter of any Option
theretofore granted shall be increased or decreased proportionately, as
the case may be.
(i) Reorganization. In case the Company is merged or consolidated
with another corporation and the Company is not the surviving
corporation, or in case the property or stock of the Company is acquired
by another corporation, or in case of a separation, reorganization,
recapitalization or liquidation of the Company, the Board of Directors
of the Company, or the Board of Directors of any corporation assuming
the obligations of the Company hereunder, shall either (i) make
appropriate provision for the protection of any outstanding Options by
the substitution on an equitable basis of appropriate stock of the
Company, or of the merged, consolidated or otherwise reorganized
corporation which will be issuable in respect to the Common Stock,
provided only that the excess of the aggregate fair market value of the
shares of Stock subject to Option immediately after such substitution
over the purchase price thereof is not more than the excess of the
aggregate fair market value of the shares of Stock subject to Option
immediately before such substitution over the purchase price thereof, or
(ii) upon written notice to the Optionee provide that the Option
(including, in the discretion of the Board of Directors, any portion of
such Option which is not then exercisable) must be exercised within
sixty days of the date of such notice or it will be terminated. If any
adjustment under this Section 8(i) would create a fractional share of
Stock or a right to acquire a fractional share, such shall be
disregarded and the number of shares of Stock available under the Stock
Option Plan and the number of shares of Stock covered under any Options
previously granted pursuant tot he Stock Option Plan shall be the next
lower number of shares of Stock, rounding all fractions downward. An
adjustment made under this Section 8(i) by the Board of Directors shall
be conclusive and binding on all affecting persons.
Except as otherwise expressly provided in this Plan, the Optionee shall
have no rights by reason of any subdivision or consolidation of shares of stock
of any class, or the payment of any stock dividend or any other increase or
decrease in the number of shares of stock of any class, or by reason of any
dissolution, liquidation, merger or consolidation or spin-off of assets or stock
of another corporation; and any issue by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall not
affect, and no adjustment by
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reason thereof shall be made with respect to, the number of prices of Common
Stock subject to an Option.
The grant of an Option pursuant to the Stock Option Plan shall not
affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge or to consolidate or to dissolve, liquidate or sell, or
transfer all or any part of its businesses or assets.
(j) Annual Limitation. The aggregate fair market value
(determined at the time the Option is granted) of the shares of Stock
with respect to which qualified incentive stock options are exercisable
for the first time by an Optionee during any calendar year (under all
incentive stock option plans of the Company) shall not exceed $100,000.
Any excess over such amount shall be deemed to be related to and part of
a non-qualified stock option granted pursuant to Section 9 of the Stock
Option Plan.
(k) General Restriction. Each Option shall be subject to the
requirement that if at any time the Board of Directors shall determine,
in its discretion, that the listing, registration or qualification of
the shares of Stock subject to such Option upon any securities or under
any state or federal law, or the consent or approval of any government
regulatory body, is necessary or desirable as a condition of, or in
connection with, the granting of such Option or the issue or purchase of
shares of Stock thereunder, such Option may not be exercised in whole or
in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Board of Directors. Alternatively, such Options shall
be issued and exercisable only upon such terms and conditions and with
such restrictions as shall be necessary or appropriate to effect
exemption from such listing, registration or other qualification
requirement.
9. NON-QUALIFIED STOCK OPTIONS
(a) Within the limitations described in Section 9(b), the Board
of Directors or the Committee may grant to Eligible Participants Options
under the Stock Option Plan which are not "qualified incentive stock
options" as defined under the provisions of Section 422 of the Code.
Such non-qualified stock options shall be evidenced by Agreements in
such form and not inconsistent with this Plan as the Board of Directors
or the Committee shall approve from time to time, which Agreements shall
contain in substance the same terms and conditions as set forth in
Section 8 hereof with respect to qualified incentive stock options
(except that, with respect to Options awarded to Non-Employee Directors,
references to employment with the Company shall be deemed to mean
service on the Board of Directors); provided, however, that the
limitations set forth in Sections 8(a) and 8(c) with respect to Ten
Percent Owners shall not be applicable to non-qualified stock options
granted to any Ten Percent Owner, and the limitation set forth in
Section 8(j) with respect to the annual limitation of incentive stock
options shall
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not be applicable to non-qualified stock option grants; provided
further, that non-qualified stock options may be granted at a purchase
price equal to not less than 75% of the Market Price on the day the
Option is granted.
(b) With respect to Non-Employee Directors then serving on the
Committee, non-qualified stock options may be granted pursuant to
Section 9(a) of the Stock Option Plan to such Non-Employee Directors
only upon authorization and approval by the Board of Directors or the
shareholders of the Company; provided that, where the Board of Directors
authorizes Option grants under this Section 9(b), the Non-Employee
Director to receive such Options shall not participate in the Board of
Director's authorization of such grant.
10. AMENDMENT OF THE STOCK OPTION PLAN
The Stock Option Plan may at any time to time be terminated, modified or
amended by the affirmative vote of not less than a majority of the shares
present and voting thereon by the Company's shareholders at a meeting of the
shareholders at which a quorum is present. The Board of Directors may at any
time and from time to time modify or amend the Stock Option Plan in any respect,
except that without shareholder approval the Board of Directors may not (i)
increase the maximum number of shares of Stock for which Options may be granted
under the Stock Option Plan (other than increases due to changes in
capitalization as referred to in Section 8(h) hereof), or (ii) extend the
maximum period during which Options may be granted or exercised, or (iii) change
the class of persons eligible for Options under the Stock Option Plan, or (iv)
otherwise materially modify the requirements as to eligibility for participation
in the Stock Option Plan. The termination or any modification or amendment of
the Stock Option Plan shall not, without the written consent of an Optionee,
affect his or her rights under an Option or right previously granted to him or
her. With the written consent of the Optionee affected, the Board of Directors
or the Committee may amend outstanding Agreements in a manner not inconsistent
with the Stock Option Plan. Without employee consent, the Board of Directors or
the Committee may at any time and from time to time modify or amend outstanding
Agreements in such respects as it shall deem necessary in order that incentive
stock options granted hereunder shall comply with the appropriate provisions of
the Code and regulations thereunder which are in effect from time to time
respecting qualified incentive stock options. The Board of Directors may also
suspend the granting of Options pursuant to the Stock Option Plan at any time
and may terminate the Stock Option Plan at any time; provided, however, no such
suspension or termination shall modify or amend any Option granted before such
suspension or termination unless (i) the affected participant consents in
writing to such modification or amendment or (ii) there is a dissolution or
liquidation of the Company.
11. BINDING EFFECT
All decisions of the Board of Directors or the Committee involving the
implementation, administration or operation of the Stock Option Plan or any
offering under the Stock Option Plan shall be binding on the Company and on all
persons eligible or who become eligible to participate in the Stock Option Plan.
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12. APPLICATION OF FUNDS
The proceeds received by the Company from the sale of Common Stock
pursuant to Options exercised hereunder will be used for general working
capital.