ONLINE INTERNATIONAL CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
SECTION ONE
PURPOSE
This Employee Stock Purchase Plan (the "plan") is intended as an
incentive and to encourage stock ownership by employees, officers and directors
of Online International Corporation (the "Company") so that they may acquire or
increase their proprietary interest in the growth and success of the Company,
and to encourage them to remain an employee, officer or director of the Company.
SECTION TWO
ADMINISTRATION
The plan shall be administered by a committee appointed by the board of
directors of the company and consisting of at least three of its members.
Members of the committee shall not be eligible to participate in the plan. The
committee shall have authority to make rules and regulations for the
administration of the plan; its interpretations and decisions shall be final and
conclusive unless otherwise determined by the board of directors. The board of
directors may from time to time remove members from, or add members to, the
committee. Vacancies on the committee, however caused, shall be filled by the
board of directors. The committee shall select one of its members as
chairperson, and shall hold meetings at such times and places as it may
determine. A majority of the committee at which a quorum is present, or acts
reduced to or approved in writing by a majority of the members of the committee,
shall be the valid acts of the committee. The committee is vested with the full
authority to make, administer, and interpret such equitable rules and
regulations regarding the plan as it may deem advisable, subject to the terms of
the plan. No member of the board of directors or the committee shall be liable
for any action or determination made in good faith with respect to the plan or
any option granted under it. The grant of options under the plan will be
automatic and nondiscretionary.
SECTION THREE
SHARES SUBJECT TO PLAN
The maxim aggregate number of shares which may be optioned under the Plan is one
million (1,000,000) common shares ( the "Pool"). The par value of the common
stock is $.001. The shares may be authorized, but unissued, or required common
shares. If any option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased shares shall become
available for future grant under the Plan. If the shares which were acquired
upon exercise of an option are subsequently repurchased by the Company,
such shares will not in any event be returned to the plan and shall not become
available for future grant under the Plan.
SECTION FOUR
ELIGIBILITY
The full-time key employees, officers and directors (hereinafter "employee or
participant") of the Company and its subsidiaries, if any, with one or more
years of service to the Company shall be eligible to participate in the plan, in
accordance with such rules as may be prescribed from time to time, which rules,
however, shall neither permit nor deny participation in the plan contrary to the
requirements of the Internal Revenue Code and regulations promulgated under the
Code. No employee shall be granted an option if the employee, immediately after
the option is granted, owns five per cent (5%) or more of the total combined
voting power or value of the stock of the Company or any subsidiary. For
purposes of the preceding sentence, the rules of Section 424(d) of the Internal
Revenue Code shall apply in determining the stock ownership of an employee, and
stock which the employee may purchase under outstanding options shall be treated
as stock owned by the employee. Employees of the Company who work less than
twenty (20) hours per week shall not be eligible to participate in this stock
purchase plan.
SECTION FIVE
GRANT OF OPTIONS
The committee will grant to eligible participants options to purchase such
number of shares and at such time or times as it will determine subject to the
limitations contained in this Stock Option Plan.
(a) All eligible participants shall enjoy equal rights and privileges
under the plan.
(b) In determining whether the stock ownership of an eligible
participants exceeds the five percent threshold limit, the rules of Section 424
(d) of the Internal Revenue Code, as amended, will apply and stock which the
eligible employee may purchase under the outstanding options, (whether or not
the options qualify for the special tax treatment of Section 421 (a) of the
Internal Revenue Code) shall be treated as stock owned by the eligible
participant. Of course, if the participant would not own more than five percent
(5%) immediately after the grant of the options the stock will not be deemed to
be owned by the participant.
(c) No eligible participant shall be granted an option which permits
his or her rights to purchase stock under the stock option plan which permits
his or her right to purchase stock under the plan to exceed One Hundred Thousand
Dollars ($100,000) of the fair market value of the stock determined as of the
date the option is granted. In that the options are being granted prior to the
existence of any trading market or as the Company is currently closely held, no
grantee shall be permitted to purchase more than One Hundred Thousand Dollars
($100,000) of Common Stock of the Company pursuant to the instant option plan in
any one
twelve month period. The exercise price of the per share will be one dollar
($1.00). In the event the company becomes publicly traded, the fair market value
will be determined in conjunction with the market price, however, no participant
shall be permitted to exercise stock option as a price less than one dollar.
(d) In the event of a recapitalization, reclassification or merger affecting
common stock, the number of shares which may subsequently issued under the pan,
the number of shares under option at that time, and the option price may be
appropriately adjusted as determined by the committee.
(e) The participant shall be notified by the Company of the grant of an option
or options to him or her. In order to participate in the plan, the eligible
employee must sign an acceptance of option form provided by the corporation
showing the number of shares that he or she elects to purchase and must deliver
it within thirty (30) days afer the date appearing on the form to the secretary
or other officers of the Company designated in the option. An eligible employee
may accept the option to purchase the number of shares specified in his or her
option or a less number of shares but in no event less than one thousand (1000)
shares of common stock of the Company.
SECTION SIX
PURCHASE PRICE
The purchase price per share will be one dollar ($1.00) per share unless the
committee determines otherwise. Once the Company becomes public, the committee
may, in its sole discretion, create a formula that corresponds to the fair
market value of the stock.
SECTION SEVEN
METHOD OF PAYMENT
Payment for the shares under the option pursuant to the instant plan made at the
election of the eligible participant may be either lump sum payments,
installments, or a combination of those payments.
(a) An eligible participant or employee who elects the lump sum method shall pay
by cash, money order or by cashier's check at the time of acceptance of option,
an amount equal to the total purchase price of all shares accepted under the
option. The participant or employee can elect to pay less than the full lumps
sum, but in no event can he or she tender payment for less than one thousand
shares. The remaining portion of the purchase price for all of the shares which
the eligible participant or employee has accepted may be installment payments.
(b) An eligible participant or employee may elect to pay all or part of the
purchase price on the installment method shall authorize the withholding and
deduction from his or her regular pay on a specified basis not less than
monthly, over the option period. Such sums, when
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accumulated will equal the amount necessary to acquire the shares. The
deductions shall be in uniform amounts in conformity with the employer's payroll
deduction schedule. Any excess amount shall be returned the participant or
employee within thirty (30) days.
SECTION EIGHT
INTEREST ON PAYMENTS
Interest shall be allowed on sums withheld from an eligible employee's pay for
purchase of shares under his plan pursuant an election by the employee or
participant. The interest shall be credited to each eligible employee's stock
purchase account until the date of exercise. For the purpose of computing
allowable interest, installment payments will be regarded as received as of the
first day of the month in which they are withheld. The rate of interest shall be
determined by the committee. The interest shall be compounded annually and shall
be paid to each eligible employee or participant as such times or times as the
board of directors shall determine.
SECTION NINE
WITHDRAWAL OF FUNDS
An employee may at any time and for any reason permanently withdraw out
the balance accumulated in the employee's account, including interest credited
on the account, and by that action withdraw from participation in the Stock
Option Plan. Partial withdrawals shall not be permitted.
SECTION TEN
NATURE OF
THE GRANT OF THE OPTIONS
(a) The options granted pursuant to the instant plan are limited to one million
common shares of the Company and this plan must be approved by the shareholders
of the corporation within 12 months before or after the date this plan is
adopted.
(b) By the specific terms of this plan the options shall not be exercisable
after ten (10) years from the date the options are granted.
(c) The option price is one dollar ($1.00) and the price is not less than the
fair market value.
SECTION ELEVEN
STOCK CERTIFICATES
Stock certificates shall only be issued to participating employees on their
request or in such number of shares as are credited to an employee's account or
upon the participating
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employee's withdrawal from the plan for any reason.
SECTION TWELVE
REGISTRATION OF CERTIFICATES
Certificates shall be registered in the name of the employee, or, if the
employee indicates on the employee's payroll deduction authorization form, in
the employee's name jointly with a member of the employee's family, with right
of survivorship. An employee who is a resident of a jurisdiction which does not
recognize such a joint tenancy may have certificates registered in the
employee's name as tenant in common with a member of the employee's family,
without right of survivorship.
SECTION THIRTEEN
PROTECTION FROM LIABILITY
Subject to the above, the board of directors and the committee in fixing the
option price shall have full authority and discretion and be fully protected
from any liability in doing so.
SECTION FOURTEEN
RIGHTS AS SHAREHOLDER
None of the rights or privileges of a shareholder of the company shall exist
with respect to shares purchased under this plan unless and until certificates
representing the full shares have been credited to the participating employee's
account.
SECTION FIFTEEN
RIGHTS ON RETIREMENT, DEATH, OR TERMINATION OF
EMPLOYMENT
In the event of a participating employee's retirement, death, or termination of
employment, no payroll deduction shall be taken from any pay due and owing to
the employee at that time and the balance in the employee's account shall be
paid to the employee or, in the event of the employee's death, to the employee's
estate. Whether authorized leave of absence or absence for military or
governmental service shall constitute termination of employment, for the
purposes of the plan, shall, unless otherwise required by law, be determined by
the committee, which determination, unless overruled by the board of directors,
shall be final and conclusive. If, prior to one year of employment, an officer,
director, or employee's relationship with the corporation terminates, by the
employee or the corporation, with or without cause, or in the event of death,
incapacity or retirement of the participant, the participant's right to exercise
the option shall immediately terminate and all rights under this agreement shall
immediately cease. Notwithstanding the foregoing sentence, in the sole
discretion of the board of directors by an affirmative act thereof, the options
and the rights hereof can be extended after termination or separation from the
Company.
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SECTION SIXTEEN
RIGHTS NOT TRANSFERABLE
Rights under this plan are not transferable by participating employees and are
exercisable during the employee's lifetime only by the employee. Transfer of the
option by the employee by will or by the laws of descent and distribution shall
be effective to bind the corporation where the corporation has been furnished
with written notice of the transfer and a copy of the will or such other
evidence the corporation's board of directors deem necessary to establish the
validity of the transfer and the acceptance by the transferee or transferees of
the terms and conditions of the option.
SECTION SEVENTEEN
CANCELLATION OF ACCEPTANCE OF OPTION
At any time prior to, but in not event following, his or her date of exercise,
the eligible employee or participant who has elected to purchase shares may
cancel his or her acceptance of Option as to any or all of the shares by written
notice of cancellation delivered to the officer designated to received his or
her Acceptance of Option. If an employee cancels an Acceptance of Option as to
only apart of the shares, he or she shall continue to make the required
installments pay or shall make a lump sum payment as set forth above with
respect to the number shares for which the Acceptance of Option is not
cancelled.
(a) He or she may receive in one lump sum payment as soon as practicable after
delivery of the notice of cancellation, the amount credited to his or her
account with respect to the shares (including interest, as computed under this
agreement); or
(b) He or she may have the amount which is credited to his or her
account with respect to the shares at the time the cancellation becomes
effective applied to the purchase of the number of shares that amount will
purchase, not exceeding, however, the number of shares by which for the
Acceptance of Option is cancelled and receive the balance of the account in one
lump sum payment.
(c) The date on which payment for the share is completed shall be the date of
exercise with respect to the shares not cancelled.
SECTION EIGHTEEN
APPLICATION OF FUNDS
All funds received or held by the company under this plan may be used for any
corporate purpose.
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SECTION NINETEEN
ADJUSTMENT IN CASE OF CHANGES AFFECTING COMMON
STOCK
In the event of a subdivision of outstanding shares of common stock, ($.001) par
value, or the payment of a stock dividend on the shares, the number of shares
approved for this plan, and the share limitation, shall be increased or
decreased proportionately, and such other adjustment shall be made as may be
deemed equitable by the board of directors. In the event of any other change
affecting the common stock, such adjustment shall be made as may be deemed
equitable by the board of directors to give proper effect to that event.
SECTION TWENTY
PLAN AMENDMENT
The committee may, at any time, or from time to time, amend this plan in any
respect, except that, without the approval of the holders of a majority of the
shares of common stock of the Company then issued and outstanding and entitled
to vote, no amendment shall be made (i) increasing or decreasing the number of
shares approved for this plan (other than as provided in Section Three), (ii)
decreasing the purchase price per share, (iii) withdrawing the administration of
this plan from the committee, or (iv) changing the designation of eligible
participants in the plan.
SECTION TWENTY-ONE
PLAN TERMINATION
This plan and all rights of employees or participants under this plan shall
terminate:
(a) On the day that accumulated payroll deductions of participating employees
are sufficient to purchase a number of shares equal to or greater than the
number of shares remaining available for purchases. If the number of shares so
purchasable is greater than the shares remaining available, the available shares
shall be allocated by the committee among such participating employees in the a
manner it deems equitable; or
(b) Notwithstanding the foregoing, the Stock Option Plan shall terminate at 5:00
p.m., Eastern Time, on August 30, 2010.
(c) At any time, at the discretion of the board of directors.
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DEFINITIONS
As used herein, the following definitions will apply:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Common Shares" shall mean the commons shares of the Company.
(c) "Company" shall mean Online International Corporation, a Nevada corporation.
(d) "Director" shall mean a member of the Board of Director.
(e) "Employee" shall mean any person including officers and Directors, employed
by the Company or any current future subsidiary of the Company. The payment of a
director's fee by the Company shall not be sufficient in and of itself to
constitute employment by the Company.
(f) "Option" shall man a stock option granted pursuant to the instant Plan.
(g) "Optionee" shall mean any grantee of an option pursuant to the terms of this
Stock Option Plan.
(h) "Parent" shall mean a "parent corporation "whether now or hereafter
existing, as defined in Section 424 (g) of the Internal Revenue Code of 1999.
(i) "Plan" means this Stock Option Plan.
(j) "Share" means the common stock of the Company, as adjusted, if necessary.
(k) The phrase "average market price" means the average of the bid and asked
prices of the company's common stock as reported by the National Association of
Securities Dealers, Inc. on the last business day of a participating employee's
pay period or, if there were no bid and asked prices on that day, the average of
the bid and asked prices of the stock on the next preceding business day on
which quotations were available. If the stock is subsequently listed on an
established stock exchange or exchanges the fair market value shall be deemed to
be the highest closing price of the common stock on the stock exchange or
exchanges on the day the option is granted or if no sale of the company's common
stock is made on any stock exchange on that day, on the next preceding day on
which there was a sale of the stock
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PLAN QUALIFICATION
This plan is intended to quality as an Employee Stock Purchase Plan as defined
in Section 422 (b) of the Internal Revenue Code.
Online International Corporation
By: /s/ Stanley James White
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Stanley James White
Chief Executive Officer, President
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