Exhibit 10.1

 

KNOBIAS, INC.

2004 STOCK INCENTIVE PLAN

 

1. Purpose; Effective Date.

 

The purpose of this 2004 Stock Incentive Plan (the “Plan”) of Knobias, Inc., a
Delaware corporation, f/k/a Consolidated Travel Systems, Inc. (the “Company”),
is to advance the interests of the Company’s stockholders by enhancing the
Company’s ability to attract, retain and motivate persons who make (or are
expected to make) important contributions to the Company by providing such
persons with equity ownership opportunities and performance-based incentives and
thereby better aligning the interests of such persons with those of the
Company’s stockholders. Except where the context otherwise requires, the term
“Company” shall include any of the Company’s present or future parent or
subsidiary corporations as defined in Sections 424(e) or (f) of the Internal
Revenue Code of 1986, as amended, and any regulations promulgated thereunder
(the “Code”), and any other business venture (including, without limitation,
joint venture or limited liability company) in which the Company has a
controlling interest, as determined by the Board of Directors of the Company
(the “Board”).

 

The Plan shall become effective upon the latest to occur of (i) the filing of
the Company’s Amended and Restated Certificate of Incorporation and (ii) the
Effective Time of the Merger, as defined in the Agreement and Plan of
Reorganization dated as of June 30, 2004, by and among Knobias Holdings, Inc.,
the Company and KHI Acquisition, Inc.

 

2. Eligibility.

 

All of the Company’s employees, officers, directors, consultants, advisors, and
other service providers (including persons who have entered into an agreement
with the Company under which they will be employed by the Company in the future)
are eligible to be granted options, restricted stock, restricted stock units,
stock appreciation rights or other stock-based awards (each, an “Award”) under
the Plan. Each person who has been granted an Award under the Plan shall be
deemed a “Participant.”

 

3. Administration and Delegation.

 

(a) Administration by Board of Directors. The Plan will be administered by the
Board. The Board shall have authority to grant Awards and to adopt, amend and
repeal such administrative rules, guidelines and practices relating to the Plan
as it shall deem advisable. The Board may correct any defect, supply any
omission or reconcile any inconsistency in the Plan or any Award in the manner
and to the extent it shall deem expedient to carry the Plan into effect and it
shall be the sole and final judge of such expediency. All decisions by the Board
shall be made in the Board’s sole discretion and shall be final and binding on
all persons having or claiming any interest in the Plan or in any Award. No
director or person acting pursuant to the authority delegated by the Board shall
be liable for any action or determination relating to or under the Plan made in
good faith.

 

(b) Appointment of Committees. To the extent permitted by applicable law, the
Board may delegate any or all of its powers under the Plan to one or more
committees or subcommittees of the Board (a

 

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“Committee”). All references in the Plan to the “Board” shall mean the Board or
a Committee of the Board or the officers referred to in Section 3(c) to the
extent that the Board’s powers or authority under the Plan have been delegated
to such Committee or officers.

 

(c) Delegation to Officers. To the extent permitted by applicable law, the Board
may delegate to one or more officers of the Company the power to grant Awards to
employees or officers of the Company or any of its present or future subsidiary
corporations and to exercise such other powers under the Plan as the Board may
determine, provided that the Board shall fix the terms of the Awards to be
granted by such officers (including the exercise price of such Awards, which may
include a formula by which the exercise price will be determined) and the
maximum number of shares subject to Awards that the officers may grant; provided
further, however, that no officer shall be authorized to grant Awards to himself
or herself.

 

4. Stock Available for Awards.

 

(a) Number of Shares. Subject to adjustment under Section 9, Awards may be made
under the Plan for up to 5,000,000 shares of common stock, $.01 par value per
share, of the Company (the “Common Stock”). If any Award expires, is terminated,
surrendered or canceled without having been fully exercised, is forfeited in
whole or in part (including as the result of shares of Common Stock subject to
such Award being repurchased by the Company at the original issuance price
pursuant to a contractual repurchase right), or results in any Common Stock not
being issued (including without limitation, when an Award is settled for cash),
then in each such case the unused Common Stock covered by such Award shall again
be available for the grant of Awards under the Plan. Further, shares of Common
Stock tendered to the Company by a Participant to exercise an Award (either by
actual delivery or by attestation) shall be added to the number of shares of
Common Stock available for the grant of Awards under the Plan. However, in the
case of Incentive Stock Options (as hereinafter defined), the foregoing
provisions shall be subject to any limitations under the Code.

 

(b) Sub-limits. Subject to adjustment under Section 9, the following sub-limits
on the number of shares of Common Stock subject to Awards shall apply:

 

(1) Section 162(m) Per-Participant Limit. The maximum number of shares of Common
Stock with respect to which Awards may be granted to any Participant under the
Plan in any calendar year shall be 5,000,000. The per-Participant limit
described in this Section 4(b)(1) shall be construed and applied consistently
with Section 162(m) of the Code (“Section 162(m)”).

 

(2) Limit on Awards other than Options and SARs. The maximum number of shares
with respect to which Awards other than Options and SARs may be granted shall be
one-half of the total number of shares of Common Stock covered by the Plan
(including any shares that may become available under this Plan pursuant to
Section 4(a) hereof).

 

5. Stock Options.

 

(a) General. The Board may grant options to purchase Common Stock (each, an
“Option”) and determine the number of shares of Common Stock to be covered by
each Option, the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option, including conditions
relating to applicable federal or state securities laws, as it considers
necessary or advisable. An Option which is

 

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not intended to be an Incentive Stock Option (as hereinafter defined) shall be
designated a “Nonstatutory Stock Option”.

 

(b) Incentive Stock Options. An Option that the Board intends to be an
“incentive stock option” as defined in Section 422 of the Code (an “Incentive
Stock Option”) shall only be granted to employees of Knobias, Inc., any of
Knobias, Inc.’s present or future parent or subsidiary corporations as defined
in Sections 424(e) or (f) of the Code, and any other entities the employees of
which are eligible to receive Incentive Stock Options under the Code, and shall
be subject to and shall be construed consistently with the requirements of
Section 422 of the Code. The Company shall have no liability to a Participant,
or any other party, if an Option (or any part thereof) that is intended to be an
Incentive Stock Option is not an Incentive Stock Option.

 

(c) Exercise Price. The Board shall establish the exercise price at the time
each Option is granted and specify it in the applicable option agreement;
provided, however, that the exercise price shall be not less than 100% of the
fair market value (the “Fair Market Value”) of the Common Stock, as determined
by the Board, at the time the Option is granted.

 

(d) No Reload Rights. Options granted under this Plan shall not contain any
provision entitling the optionee to the automatic grant of additional Options in
connection with any exercise of the original Option.

 

(e) No Repricing. Unless such action is approved by the Company’s stockholders:
(i) no outstanding Option granted under the Plan may be amended to provide an
exercise price per share that is lower than the then-current exercise price per
share of such outstanding Option (other than adjustments pursuant to Section 9),
and (ii) the Board may not cancel any outstanding Option and grant in
substitution therefor new Options under the Plan covering the same or a
different number of shares of Common Stock and having an exercise price per
share lower than the then-current exercise price per share of the cancelled
Option.

 

(f) Duration of Options. Each Option shall be exercisable at such times and
subject to such terms and conditions as the Board may specify in the applicable
option agreement provided, however, that no Option will be granted for a term in
excess of 10 years.

 

(g) Exercise of Option. Options may be exercised by delivery to the Company of a
written notice of exercise signed by the proper person or by any other form of
notice (including electronic notice) approved by the Company, together with
payment in full as specified in Section 5(h) for the number of shares for which
the Option is exercised. Shares of Common Stock subject to the Option will be
delivered by the Company following exercise either as soon as practicable or, to
the extent permitted by the Company in its sole discretion, on a deferred basis
(with the Company’s obligation to be evidenced by an instrument providing for
future delivery of the deferred shares at the time or times specified by the
Board).

 

(h) Payment Upon Exercise. Common Stock purchased upon the exercise of an Option
granted under the Plan shall be paid for as follows:

 

(1) in cash or by check, payable to the order of the Company;

 

(2) except as the Board may, in its sole discretion, otherwise provide in an
option agreement, by (i) delivery of an irrevocable and unconditional
undertaking by a creditworthy broker to deliver promptly to the Company
sufficient funds to pay the exercise price and any required tax withholding or
(ii)

 

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delivery by the Participant to the Company of a copy of irrevocable and
unconditional instructions to a creditworthy broker to promptly pay to the
Company the exercise price and any required tax withholding;

 

(3) if provided for in the option agreement or approved by the Company, in its
sole discretion, by delivery (either by actual delivery or attestation) of
shares of Common Stock owned by the Participant valued at their Fair Market
Value, provided (i) such method of payment is then permitted under applicable
law, (ii) such Common Stock, if acquired directly from the Company was owned by
the Participant for such minimum period of time, if any, as may be established
by the Board in its discretion, and (iii) such Common Stock is not subject to
any repurchase, forfeiture, unfulfilled vesting or other similar requirements;

 

(4) if provided for in the option agreement or approved by the Company, in its
sole discretion, by (i) delivery of a promissory note of the Participant (other
than Participants who are directors or executive officers (or equivalent
thereof)) to the Company on terms determined by the Board, or (ii) payment of
such other lawful consideration as the Board may determine; or

 

(5) by any combination of the above permitted forms of payment.

 

(i) Substitute Options. In connection with a merger or consolidation of an
entity with the Company or the acquisition by the Company of property or stock
of an entity, the Board may grant Options in substitution for any options or
other stock or stock-based awards granted by such entity or an affiliate
thereof. Substitute Options may be granted pursuant to this Section 5(i) on such
terms as the Board deems appropriate in the circumstances, notwithstanding any
limitations on Options contained in the other sections of this Section 5 or in
Section 4.

 

(j) Amendment of Options. Subject to the provisions of Section 10(f), the Board
may amend an Option to convert it into a Stock Appreciation Right.

 

6. Stock Appreciation Rights.

 

(a) Nature of Stock Appreciation Rights. A Stock Appreciation Right, or SAR, is
an Award entitling the holder on exercise to receive an amount in cash or Common
Stock or a combination thereof (such form to be determined by the Board)
determined in whole or in part by reference to appreciation, from and after the
date of grant, in the fair market value of a share of Common Stock. SARs may be
based solely on appreciation in the fair market value of Common Stock or on a
comparison of such appreciation with some other measure of market growth such as
(but not limited to) appreciation in a recognized market index. The date as of
which such appreciation or other measure is determined shall be the exercise
date unless another date is specified by the Board.

 

(b) Grant of Stock Appreciation Rights. Stock Appreciation Rights may be granted
in tandem with, or independently of, Options granted under the Plan.

 

(1) Rules Applicable to Tandem Awards. When Stock Appreciation Rights are
granted in tandem with Options, (a) the Stock Appreciation Right will be
exercisable only at such time or times, and to the extent, that the related
Option is exercisable (except to the extent designated by the Board in
connection with an Acquisition Event or a Change in Control Event) and will be
exercisable in accordance with the procedure required for exercise of the
related Option; (b) the Stock Appreciation Right will terminate and no longer be
exercisable upon the termination or exercise of the related Option, except to
the extent designated by the Board

 

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in connection with an Acquisition Event or a Change in Control Event and except
that a Stock Appreciation Right granted with respect to less than the full
number of shares covered by an Option will not be reduced until the number of
shares as to which the related Option has been exercised or has terminated
exceeds the number of shares not covered by the Stock Appreciation Right; (c)
the Option will terminate and no longer be exercisable upon the exercise of the
related Stock Appreciation Right; and (d) the Stock Appreciation Right will be
transferable only with the related Option.

 

(2) Exercise of Independent Stock Appreciation Rights. A Stock Appreciation
Right not granted in tandem with an Option will become exercisable at such time
or times, and on such conditions, as the Board may specify. The Board may at any
time accelerate the time at which all or any part of the Right may be exercised.

 

(c) Exercise of Stock Appreciation Rights. Stock Appreciation Rights may be
exercised by delivery to the Company of a written notice of exercise signed by
the proper person or by any other form of notice (including electronic notice)
approved by the Company.

 

7. Restricted Stock; Restricted Stock Units.

 

(a) Grants. The Board may grant Awards entitling recipients to acquire shares of
Common Stock (“Restricted Stock”), subject to the right of the Company to
repurchase all or part of such shares at their issue price or other stated or
formula price (or to require forfeiture of such shares if issued at no cost)
from the recipient in the event that conditions specified by the Board in the
applicable Award are not satisfied prior to the end of the applicable
restriction period or periods established by the Board for such Award. Instead
of granting Awards for Restricted Stock, the Board may grant Awards entitling
the recipient to receive shares of Common Stock to be delivered in the future
(“Restricted Stock Units”) subject to such terms and conditions on the delivery
of the shares of Common Stock as the Board shall determine (each Award for
Restricted Stock or Restricted Stock Units, a “Restricted Stock Award”). The
Board may also permit an exchange of unvested shares of Common Stock that have
already been delivered to a Participant for an instrument evidencing the right
to future delivery of Common Stock at such time or times, and on such
conditions, as the Board shall specify.

 

(b) Terms and Conditions. The Board shall determine the terms and conditions of
any such Restricted Stock Award, including the conditions for repurchase (or
forfeiture) and the issue price, if any.

 

(c) Limitations on Vesting.

 

(1) Restricted Stock Awards that vest based on the passage of time alone shall
be zero percent vested prior to the first anniversary of the date of grant, no
more than 33-1/3% vested after the said first anniversary of the date of grant
and before the second anniversary of the date of grant, and no more than 66-2/3%
vested after the second anniversary of the date of grant and before the third
anniversary of the date of grant. Restricted Stock Awards that vest based on
performance alone shall not vest earlier than the first anniversary of the date
of grant. Restricted Stock Awards that vest upon the passage of time and provide
for accelerated vesting based on performance shall not vest earlier than the
first anniversary of the date of grant. Notwithstanding the preceding provisions
of this Section 7(c)(1), the Board may grant Restricted Stock Awards that are
not subject to any limitations on vesting with respect to up to 5% of the total
number of shares of Common Stock covered by the Plan (excluding any shares that
may become available under this Plan pursuant to Section 4(a) hereof).

 

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(2) Notwithstanding any other provision of this Plan, the Board may, in its
discretion, either at the time a Restricted Stock Award is made or at any time
thereafter, waive its right to repurchase shares of Common Stock (or waive the
forfeiture thereof) or remove or modify any part or all of the restrictions
applicable to the Restricted Stock Award, provided that the Board may only
exercise such rights in extraordinary circumstances which shall include, without
limitation, death or disability of the Participant; estate planning needs of the
Participant; a merger, consolidation, sale, reorganization, recapitalization, or
change in control of the Company; or any other nonrecurring significant event
affecting the Company, a Participant or the Plan.

 

8. Other Stock-Based Awards.

 

Other Awards of shares of Common Stock and other Awards that are valued in whole
or in part by reference to, or are otherwise based on, shares of Common Stock or
other property, including without limitation rights to purchase shares of Common
Stock (“Other Stock Unit Awards”), may be granted hereunder to Participants.
Such Other Stock Unit Awards shall also be available as a form of payment in the
settlement of other Awards granted under the Plan or as payment in lieu of
compensation to which a Participant is otherwise entitled. Other Stock Unit
Awards may be paid in shares of Common Stock or cash, as the Board shall
determine. Subject to the provisions of the Plan, the Board shall determine the
conditions of each Other Stock Unit Awards, including any purchase price
applicable thereto.

 

9. Adjustments for Changes in Common Stock and Certain Other Events.

 

(a) Changes in Capitalization. In the event of any stock split, reverse stock
split, stock dividend, recapitalization, combination of shares, reclassification
of shares, spin-off or other similar change in capitalization or event, or any
distribution to holders of Common Stock other than an ordinary cash dividend,
(i) the number and class of securities available under this Plan, (ii) the
sub-limits set forth in Section 4(b), (iii) the number and class of securities
and exercise price per share subject to each outstanding Option, (iv) the
repurchase price per share subject to each outstanding Restricted Stock Award
and (v) the terms of each other outstanding stock-based Award shall be
appropriately adjusted by the Company (or substituted Awards may be made, if
applicable) to the extent the Board shall determine, in good faith, that such an
adjustment (or substitution) is necessary and appropriate. If this Section 9(a)
applies and Section 9(c) also applies to any event, Section 9(c) shall be
applicable to such event, and this Section 9(a) shall not be applicable.

 

(b) Liquidation or Dissolution. In the event of a proposed liquidation or
dissolution of the Company, the Board shall upon written notice to the
Participants provide that all then unexercised Options will (i) become
exercisable in full as of a specified time at least 10 business days prior to
the effective date of such liquidation or dissolution and (ii) terminate
effective upon such liquidation or dissolution, except to the extent exercised
before such effective date. The Board may specify the effect of a liquidation or
dissolution on any Restricted Stock Award granted under the Plan at the time of
the grant.

 

(c) Reorganization Events.

 

(1) Definition. A “Reorganization Event” shall mean: (a) any merger or
consolidation of the Company with or into another entity as a result of which
all of the outstanding shares of Common Stock are converted into or exchanged
for the right to receive cash, securities or other property or (b) any exchange
of all of the Common Stock for cash, securities or other property pursuant to a
share exchange transaction.

 

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(2) Consequences of a Reorganization Event on Awards. In connection with a
Reorganization Event, the Board shall take any one or more of the following
actions as to all or any outstanding Awards on such terms as the Board
determines: (i) provide that Awards shall be assumed, or substantially
equivalent Awards shall be substituted, by the acquiring or succeeding
corporation (or an affiliate thereof), (ii) upon written notice to a
Participant, provide that the Participant’s unexercised Options or other
unexercised Awards shall become exercisable in full and will terminate
immediately prior to the consummation of such Reorganization Event unless
exercised by the Participant within a specified period following the date of
such notice, (iii) in the event of a Reorganization Event under the terms of
which holders of Common Stock will receive upon consummation thereof a cash
payment for each share surrendered in the Reorganization Event (the “Acquisition
Price”), make or provide for a cash payment to a Participant equal to (A) the
Acquisition Price times the number of shares of Common Stock subject to the
Participant’s Options or other Awards (to the extent the exercise price does not
exceed the Acquisition Price) minus (B) the aggregate exercise price of all such
outstanding Options or other Awards, in exchange for the termination of such
Options or other Awards, (iv) provide that outstanding Awards shall become
exercisable or realizable, or restrictions applicable to a Restricted Stock
Award or other Award shall lapse, in whole or in part, prior to or upon such
Reorganization Event, (v) provide that, in connection with a liquidation or
dissolution of the Company, Awards shall convert into the right to receive
liquidation proceeds (if applicable, net of the exercise price thereof) and (vi)
any combination of the foregoing. To the extent all or any portion of an Award
becomes exercisable solely as a result of clause (ii) above, the Board may
provide that upon exercise of such Award the Participant shall receive shares
subject to a right of repurchase by the Company or its successor at the Award
exercise price; such repurchase right (A) shall lapse at the same rate as the
Award would have become exercisable under its terms and (B) shall not apply to
any shares subject to the Award that were exercisable under its terms without
regard to clause (ii) above.

 

10. General Provisions Applicable to Awards.

 

(a) Transferability of Awards. Except as the Board may otherwise determine or
may provide in an Award, Awards shall not be sold, assigned, transferred,
pledged or otherwise encumbered by the person to whom they are granted, either
voluntarily or by operation of law, except by will or the laws of descent and
distribution, and, during the life of the Participant, shall be exercisable only
by the Participant. References to a Participant, to the extent relevant in the
context, shall include references to authorized transferees.

 

(b) Documentation. Each Award shall be evidenced in such form (written,
electronic or otherwise) as the Board shall determine. Each Award may contain
terms and conditions in addition to those set forth in the Plan.

 

(c) Board Discretion. Except as otherwise provided by the Plan, each Award may
be made alone or in addition or in relation to any other Award. The terms of
each Award need not be identical, and the Board need not treat Participants
uniformly.

 

(d) Termination of Status. The Board shall determine the effect on an Award of
the disability, death, retirement, authorized leave of absence or other change
in the employment or other status of a Participant and the extent to which, and
the period during which, the Participant, the Participant’s legal
representative, conservator or guardian may exercise rights under the Award.

 

(e) Withholding. The Company may require each Participant to pay to the Company,
or make provision satisfactory to the Company for payment of, an amount
sufficient to pay any taxes, social security

 

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contributions, or other similar amounts required by law to be withheld in
connection with an Award to such Participant. If provided for in an Award or
approved by the Company, in its sole discretion, a Participant may satisfy such
tax obligations in whole or in part by delivery of shares of Common Stock,
including shares retained from the Award creating the tax obligation, valued at
their Fair Market Value; provided, however, that except as otherwise provided by
the Board, the total tax withholding where stock is being used to satisfy such
tax obligations cannot exceed the Company’s minimum statutory withholding
obligations (based on minimum statutory withholding rates for federal and state
tax purposes, including payroll taxes, that are applicable to such supplemental
taxable income). Shares surrendered to satisfy tax withholding requirements
cannot be subject to any repurchase, forfeiture, unfulfilled vesting or other
similar requirements. The Company may, to the extent permitted by law, deduct
any such tax obligations from any payment of any kind otherwise due to a
Participant.

 

(f) Amendment of Award. Except as prohibited by Section 5(e), the Board may
amend, modify or terminate any outstanding Award, including but not limited to,
substituting therefor another Award of the same or a different type, changing
the date of exercise or realization, converting an Incentive Stock Option to a
Nonstatutory Stock Option and converting an Option into a SAR, provided that, in
each such case, the Participant’s consent to such action shall be required
unless the Board determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.

 

(g) Conditions on Delivery of Stock. The Company will not be obligated to
deliver any shares of Common Stock pursuant to the Plan or to remove
restrictions from shares previously delivered under the Plan until (i) all
conditions of the Award have been met or removed to the satisfaction of the
Company, (ii) in the opinion of the Company’s counsel, all other legal matters
in connection with the issuance and delivery of such shares have been satisfied,
including any applicable securities laws and any applicable stock exchange or
stock market rules and regulations, and (iii) the Participant has executed and
delivered to the Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any applicable laws, rules
or regulations.

 

(h) Acceleration. The Board may at any time provide that any Award shall become
immediately exercisable in full or in part, free of some or all restrictions or
conditions, or otherwise realizable in full or in part, as the case may be;
provided, however, that this sentence shall apply to a Restricted Stock Award
only to the extent consistent with Sections 7(c)(2) and 10(j).

 

(i) Deferral. The Board may provide in an Award or in an amendment to an Award
that the Participant may elect to defer the delivery of shares of Common Stock
that would otherwise be delivered pursuant to such Award. The Board may
establish such conditions on the Participant’s election as it deems appropriate.

 

(j) Performance Conditions.

 

(1) Notwithstanding any other provision of the Plan, if the Board determines at
the time a Restricted Stock Award or an Other Stock-Based Award is granted to a
Participant who is then an officer, that such Participant is, or is likely to be
as of the end of the tax year in which the Company would claim a tax deduction
in connection with such Award, a Covered Employee (as defined in Section 162(m)
of the Code), then the Board may provide that this Section 10(j) is applicable
to such Award.

 

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(2) If a Restricted Stock Award or an Other Stock-Based Award is subject to this
Section 10(j), then the lapsing of restrictions thereon and the distribution of
Shares pursuant thereto, as applicable, shall be subject to the achievement of
one or more objective performance goals established by the Board, which shall be
based on one or more of the following measures: sales, earnings per share,
return on net assets, return on equity, and customer service levels. The Board
may determine that special, one-time or extraordinary gains and/or losses or
other special, one-time or extraordinary events should or should not be included
or considered in the calculation of such measures. In addition, customer service
target levels will be based on predetermined tests of customer service levels
such as scores on blind test (“mystery”) shopping, customer comment card
statistics, customer relations statistics (e.g., number of customer complaints),
and delivery response levels. The Board believes that disclosure of further
detail concerning the performance criteria may be confidential commercial or
business information, the disclosure of which would adversely affect the
Company. Such performance goals may vary by Participant and may be different for
different Awards. Such performance goals shall be set by the Board within the
time period prescribed by, and shall otherwise comply with the requirements of,
Section 162(m) of the Code, or any successor provision thereto, and the
regulations thereunder.

 

(3) The Board shall have the power to impose such other restrictions on Awards
subject to this Section 10(j) as it may deem necessary or appropriate to ensure
that such Awards satisfy all requirements for “performance-based compensation”
within the meaning of Section 162(m)(4)(C) of the Code, or any successor
provision thereto.

 

11. Miscellaneous.

 

(a) No Right To Employment or Other Status. No person shall have any claim or
right to be granted an Award, and the grant of an Award shall not be construed
as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly provided in the
applicable Award.

 

(b) No Rights As Stockholder. Subject to the provisions of the applicable Award,
no Participant shall have any rights as a stockholder with respect to any shares
of Common Stock to be distributed with respect to an Award until becoming the
record holder of such shares. Notwithstanding the foregoing, in the event the
Company effects a split of the Common Stock by means of a stock dividend and the
exercise price of and the number of shares subject to such Option are adjusted
as of the date of the distribution of the dividend (rather than as of the record
date for such dividend), then an optionee who exercises an Option between the
record date and the distribution date for such stock dividend shall be entitled
to receive, on the distribution date, the stock dividend with respect to the
shares of Common Stock acquired upon such Option exercise, notwithstanding the
fact that such shares were not outstanding as of the close of business on the
record date for such stock dividend.

 

(c) Effective Date and Term of Plan. The Plan shall become effective on the date
on which it is approved by stockholders of the Company and shall remain in full
force and effect until terminated by the Board. No Awards shall be granted under
the Plan after the completion of ten years from the date on which the Plan is
adopted or was approved by the Company’s stockholders, whichever is earlier, but
Awards previously granted may extend beyond that date.

 

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(d) Amendment of Plan. The Board may amend, suspend or terminate the Plan or any
portion thereof at any time, provided that no amendment requiring the approval
of the Company’s stockholders under any applicable tax requirement, including
without limitation Sections 162(m) and 422 of the Code, shall become effective
until such approval of the Company’s stockholders is obtained and provided
further that without approval of the Company’s stockholders, no amendment may
(i) increase the number of shares authorized under the Plan (other than pursuant
to Section 9), (ii) materially increase the benefits provided under the Plan,
(iii) materially expand the class of participants eligible to participate in the
Plan, (iv) expand the types of Awards provided under the Plan or (v) make any
other changes which require stockholder approval under the rules of the national
securities market, if any, on which the Common Stock is listed or quoted. No
Award shall be made that is conditioned on the approval of the Company’s
stockholders of any amendment to the Plan.

 

(e) Governing Law. The provisions of the Plan and all Awards made hereunder
shall be governed by and interpreted in accordance with the laws of the State of
Delaware, without regard to any applicable conflicts of law.

 

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