exv4w1



 





Exhibit 4.1




BEVOCAL, INC.

1999 STOCK OPTION/STOCK ISSUANCE PLAN




ARTICLE ONE




GENERAL PROVISIONS




     I.     PURPOSE OF THE PLAN




            This 1999 Stock Option/Stock Issuance Plan is intended to promote the interests of BeVocal,
Inc., a Delaware corporation, by providing eligible persons in the Corporation’s employ or service
with the opportunity to acquire a proprietary interest, or otherwise increase their proprietary
interest, in the Corporation as an incentive for them to continue in such employ or service.



            Capitalized terms herein shall have the meanings assigned to such terms in the attached
Appendix.



     II.    STRUCTURE OF THE PLAN




            A.      The Plan shall be divided into two (2) separate equity programs:



                 (i)      the Option Grant Program under which eligible persons may, at the
discretion of the Plan Administrator, be granted options to purchase shares of
Common Stock, and



                 (ii)     the Stock Issuance Program under which eligible persons may, at the
discretion of the Plan Administrator, be issued shares of Common Stock directly,
either through the immediate purchase of such shares or as a bonus for services
rendered the Corporation (or any Parent or Subsidiary).



            B.      The provisions of Articles One and Four shall apply to both equity programs under the Plan
and shall accordingly govern the interests of all persons under the Plan.



     III.   ADMINISTRATION OF THE PLAN




            A.      The Plan shall be administered by the Board. However, any or all administrative functions
otherwise exercisable by the Board may be delegated to the Committee. Members of the Committee
shall serve for such period of time as the Board may determine and shall be subject to removal by
the Board at any time. The Board may also at any time terminate the functions of the Committee and
reassume all powers and authority previously delegated to the Committee.



 









 





            B.     The Plan Administrator shall have full power and authority (subject to the provisions of the
Plan) to establish such rules and regulations as it may deem appropriate for proper administration
of the Plan and to make such determinations under, and issue such interpretations of, the Plan and
any outstanding options or stock issuances thereunder as it may deem necessary or advisable.
Decisions of the Plan Administrator shall be final and binding on all parties who have an interest
in the Plan or any option grant or stock issuance thereunder.



     IV.    ELIGIBILITY




            A.      The persons eligible to participate in the Plan are as follows:



                 (i)      Employees,



                 (ii)     non-employee members of the Board or the non-employee members of the board
of directors of any Parent or Subsidiary, and



                 (iii)    consultants and other independent advisors who provide services to the
Corporation (or any Parent or Subsidiary).



            B.      The Plan Administrator shall have full authority to determine, (i) with respect to the
grants made under the Option Grant Program, which eligible persons are to receive such grants, the
time or times when those grants are to be made, the number of shares to be covered by each such
grant, the status of the granted option as either an Incentive Option or a Non-Statutory Option,
the time or times when each option is to become exercisable, the vesting schedule (if any)
applicable to the option shares and the maximum term for which the option is to remain outstanding,
and (ii) with respect to stock issuances made under the Stock Issuance Program, which eligible
persons are to receive such issuances, the time or times when those issuances are to be made, the
number of shares to be issued to each Participant, the vesting schedule (if any) applicable to the
issued shares and the consideration to be paid by the Participant for such shares.



            C.      The Plan Administrator shall have the absolute discretion either to grant options in
accordance with the Option Grant Program or to effect stock issuances in accordance with the Stock
Issuance Program.



     V.      STOCK SUBJECT TO THE PLAN




            A.      The stock issuable under the Plan shall be shares of authorized but unissued or reacquired
Common Stock. The maximum number of shares of Common Stock that may be issued over the term of the
Plan shall not exceed five million twenty-five thousand twenty-five (5,025,025) shares.



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            B.      Shares of Common Stock subject to outstanding options shall be available for subsequent
issuance under the Plan to the extent (i) the options expire or terminate for any reason prior to
exercise in full or (ii) the options are cancelled in accordance with the cancellation-regrant
provisions of Article Two. Unvested shares issued under the Plan and subsequently repurchased by
the Corporation, at the option exercise or direct issue price paid per share, pursuant to the
Corporation’s repurchase rights under the Plan shall be added back to the number of shares of
Common Stock reserved for issuance under the Plan and shall accordingly be available for reissuance
through one or more subsequent option grants or direct stock issuances under the Plan.



            C.      Should any change be made to the Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation’s receipt of consideration, appropriate
adjustments shall be made to (i) the maximum number and/or class of securities issuable under the
Plan and (ii) the number and/or class of securities and the exercise price per share in effect
under each outstanding option in order to prevent the dilution or enlargement of benefits
thereunder. The adjustments determined by the Plan Administrator shall be final, binding and
conclusive. In no event shall any such adjustments be made in connection with the conversion of
one or more outstanding shares of the Corporation’s preferred stock into shares of Common Stock.



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ARTICLE TWO




OPTION GRANT PROGRAM




     I.     OPTION TERMS




            Each option shall be evidenced by one or more documents in the form approved by the Plan
Administrator; provided, however, that each such document shall comply with the terms
specified below. Each document evidencing an Incentive Option shall, in addition, be subject to
the provisions of the Plan applicable to such options.



            A.      Exercise Price.



                    1.      The exercise price per share shall be fixed by the Plan Administrator in accordance with
the following provisions:



                 (i)      The exercise price per share shall not be less than eighty-five percent
(85%) of the Fair Market Value per share of Common Stock on the option grant date.



                 (ii)     If the person to whom the option is granted is a 10% Stockholder, then the
exercise price per share shall not be less than one hundred ten percent (110%) of
the Fair Market Value per share of Common Stock on the option grant date.



                    2.      The exercise price shall become immediately due upon exercise of the option and shall,
subject to the provisions of Section I of Article Four and the documents evidencing the option, be
payable in cash or check made payable to the Corporation. Should the Common Stock be registered
under Section 12 of the 1934 Act at the time the option is exercised, then the exercise price may
also be paid as follows:



                 (i)      in shares of Common Stock held for the requisite period necessary to avoid
a charge to the Corporation’s earnings for financial reporting purposes and valued
at Fair Market Value on the Exercise Date, or



                 (ii)     to the extent the option is exercised for vested shares, through a special
sale and remittance procedure pursuant to which the Optionee shall concurrently
provide irrevocable instructions (A) to a Corporation-designated brokerage firm to
effect the immediate sale of the purchased shares and remit to the Corporation, out
of the sale proceeds available on the settlement date, sufficient funds to cover the
aggregate exercise price payable for the purchased shares plus all applicable
Federal, state and local income and employment taxes required to be withheld by the
Corporation by reason of such exercise and (B) to the Corporation to deliver the
certificates for the purchased shares directly to such brokerage firm in order to
complete the sale.



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            Except to the extent such sale and remittance procedure is utilized, payment of the exercise
price for the purchased shares must be made on the Exercise Date.



            B.      Exercise and Term of Options. Each option shall be exercisable at such time or
times, during such period and for such number of shares as shall be determined by the Plan
Administrator and set forth in the documents evidencing the option grant. However, no option shall
have a term in excess of ten (10) years measured from the option grant date.



            C.      Effect of Termination of Service.



                    1.      The following provisions shall govern the exercise of any options held by the Optionee at
the time of cessation of Service or death:



                 (i)      Should the Optionee cease to remain in Service for any reason other than
death, Disability or Misconduct, then the Optionee shall have a period of three (3)
months following the date of such cessation of Service during which to exercise each
outstanding option held by such Optionee.



                 (ii)     Should Optionee’s Service terminate by reason of Disability, then the
Optionee shall have a period of twelve (12) months following the date of such
cessation of Service during which to exercise each outstanding option held by such
Optionee.



                 (iii)    If the Optionee dies while holding an outstanding option, then the
personal representative of his or her estate or the person or persons to whom the
option is transferred pursuant to the Optionee’s will or the laws of inheritance
shall have a twelve (12)-month period following the date of the Optionee’s death to
exercise such option.



                 (iv)    Under no circumstances, however, shall any such option be exercisable
after the specified expiration of the option term.



                 (v)      During the applicable post-Service exercise period, the option may not be
exercised in the aggregate for more than the number of vested shares for which the
option is exercisable on the date of the Optionee’s cessation of Service. Upon the
expiration of the applicable exercise period or (if earlier) upon the expiration of
the option term, the option shall terminate and cease to be outstanding for any
vested shares for which the option has not been exercised. However, the option
shall, immediately upon the Optionee’s cessation of Service, terminate and cease to
be outstanding with respect to any and all option shares for which the option is not
otherwise at the time exercisable or in which the Optionee is not otherwise at that
time vested.



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                 (vi)    Should Optionee’s Service be terminated for Misconduct or should Optionee
otherwise engage in Misconduct while holding one or more outstanding options under
the Plan, then those options shall terminate immediately and cease to remain
outstanding.



                    2.      The Plan Administrator shall have the discretion, exercisable either at the time an option
is granted or at any time while the option remains outstanding, to:



                 (i)      extend the period of time for which the option is to remain exercisable
following Optionee’s cessation of Service or death from the limited period otherwise
in effect for that option to such greater period of time as the Plan Administrator
shall deem appropriate, but in no event beyond the expiration of the option term,
and/or



                 (ii)     permit the option to be exercised, during the applicable post-Service
exercise period, not only with respect to the number of vested shares of Common
Stock for which such option is exercisable at the time of the Optionee’s cessation
of Service but also with respect to one or more additional installments in which the
Optionee would have vested under the option had the Optionee continued in Service.



            D.      Stockholder Rights. The holder of an option shall have no stockholder rights with
respect to the shares subject to the option until such person shall have exercised the option, paid
the exercise price and become the recordholder of the purchased shares.



            E.      Unvested Shares. The Plan Administrator shall have the discretion to grant options
that are exercisable for unvested shares of Common Stock. Should the Optionee cease Service while
holding such unvested shares, the Corporation shall have the right to repurchase, at the exercise
price paid per share, any or all of those unvested shares. The terms upon which such repurchase
right shall be exercisable (including the period and procedure for exercise and the appropriate
vesting schedule for the purchased shares) shall be established by the Plan Administrator and set
forth in the document evidencing such repurchase right. The Plan Administrator may not impose a
vesting schedule upon any option grant or the shares of Common Stock subject to that option that is
more restrictive than twenty percent (20%) per year vesting, with the initial vesting to occur not
later than one (1) year after the option grant date. However, such limitation shall not apply to
any option grants made to individuals who are officers of the Corporation, non-employee Board
members or independent consultants.



            F.      First Refusal Rights. Until such time as the Common Stock is first registered
under Section 12 of the 1934 Act, the Corporation shall have the right of first refusal with
respect to any proposed disposition by the Optionee (or any successor in interest) of any shares of
Common Stock issued under the Plan. Such right of first refusal shall be exercisable in accordance
with the terms established by the Plan Administrator and set forth in the document evidencing such
right.



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            G.      Limited Transferability of Options. During the lifetime of the Optionee, the
option shall be exercisable only by the Optionee and shall not be assignable or transferable other
than by will or by the laws of descent and distribution following the Optionee’s death.



     II.    INCENTIVE OPTIONS




            The terms specified below shall apply to all Incentive Options. Except as modified by the
provisions of this Section II, all the provisions of Articles One, Two and Four shall be applicable
to Incentive Options. Options that are specifically designated as Non-Statutory Options shall not
be subject to the terms of this Section II.



            A.      Eligibility. Incentive Options may only be granted to Employees.



            B.      Exercise Price. The exercise price per share shall not be less than one hundred
percent (100%) of the Fair Market Value per share of Common Stock on the option grant date.



            C.      Dollar Limitation. The aggregate Fair Market Value of the shares of Common Stock
(determined as of the respective date or dates of grant) for which one or more options granted to
any Employee under the Plan (or any other option plan of the Corporation or any Parent or
Subsidiary) may for the first time become exercisable as Incentive Options during any one (1)
calendar year shall not exceed the sum of One Hundred Thousand Dollars ($100,000). To the extent
the Employee holds two (2) or more such options that become exercisable for the first time in the
same calendar year, the foregoing limitation on the exercisability of such options as Incentive
Options shall be applied on the basis of the order in which such options are granted.



            D.      10% Stockholder. If any Employee to whom an Incentive Option is granted is a 10%
Stockholder, then the option term shall not exceed five (5) years measured from the option grant
date.



     III.   CORPORATE TRANSACTION




            A.      The shares subject to each option outstanding under the Plan at the time of a Corporate
Transaction shall automatically vest in full so that each such option shall, immediately prior to
the effective date of the Corporate Transaction, become fully exercisable for all of the shares of
Common Stock at the time subject to that option and may be exercised for any or all of those shares
as fully vested shares of Common Stock. However, the shares subject to an outstanding option shall
not vest on such an accelerated basis if and to the extent: (i) such option is assumed by the
successor corporation (or parent thereof) in the Corporate Transaction and any repurchase rights of
the Corporation with respect to the unvested option shares are concurrently to be assigned to such
successor corporation (or parent thereof) or (ii) such option is to be replaced with a cash
incentive program of the successor corporation that



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preserves the spread existing on the unvested option shares at the time of the Corporate
Transaction and provides for subsequent payout in accordance with the same vesting schedule
applicable to those unvested option shares or (iii) the acceleration of such option is subject to
other limitations imposed by the Plan Administrator at the time of the option grant.



            B.      All outstanding repurchase rights shall also terminate automatically, and the shares of
Common Stock subject to those terminated rights shall immediately vest in full, in the event of any
Corporate Transaction, except to the extent: (i) those repurchase rights are assigned to the
successor corporation (or parent thereof) in connection with such Corporate Transaction or (ii)
such accelerated vesting is precluded by other limitations imposed by the Plan Administrator at the
time the repurchase right is issued.



            C.      Immediately following the consummation of the Corporate Transaction, all outstanding
options shall terminate and cease to be outstanding, except to the extent assumed by the successor
corporation (or parent thereof).



            D.      Each option that is assumed in connection with a Corporate Transaction shall be
appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and
class of securities that would have been issuable to the Optionee in consummation of such Corporate
Transaction, had the option been exercised immediately prior to such Corporate Transaction.
Appropriate adjustments shall also be made to (i) the number and class of securities available for
issuance under the Plan following the consummation of such Corporate Transaction and (ii) the
exercise price payable per share under each outstanding option, provided the aggregate
exercise price payable for such securities shall remain the same. To the extent the actual holders
of the Corporation’s outstanding Common Stock receive cash consideration for their Common Stock in
consummation of the Corporate Transaction, the successor corporation may, in connection with the
assumption of the outstanding options under this Plan, substitute one or more shares of its own
common stock with a fair market value equivalent to the cash consideration paid per share of Common
Stock in such Corporate Transaction.



            E.      The Plan Administrator shall have the discretion, exercisable either at the time the option
is granted or at any time while the option remains outstanding, to structure one or more options so
that those options shall automatically accelerate and vest in full (and any repurchase rights of
the Corporation with respect to the unvested shares subject to those options shall immediately
terminate) upon the occurrence of a Corporate Transaction, whether or not those options are to be
assumed in the Corporate Transaction.



            F.      The Plan Administrator shall also have full power and authority, exercisable either at the
time the option is granted or at any time while the option remains outstanding, to structure such
option so that the shares subject to that option will automatically vest on an accelerated basis
should the Optionee’s Service terminate by reason of an Involuntary Termination within a designated
period (not to exceed eighteen (18) months) following the effective date of any Corporate
Transaction in which the option is assumed and the repurchase rights applicable to those shares do
not otherwise terminate. Any option so accelerated shall remain exercisable for the fully vested
option shares until the expiration or sooner termination



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of the option term. In addition, the Plan Administrator may provide that one or more of the
Corporation’s outstanding repurchase rights with respect to shares held by the Optionee at the time
of such Involuntary Termination shall immediately terminate on an accelerated basis, and the shares
subject to those terminated rights shall accordingly vest at that time.



            G.      The portion of any Incentive Option accelerated in connection with a Corporate Transaction
shall remain exercisable as an Incentive Option only to the extent the applicable One Hundred
Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is
exceeded, the accelerated portion of such option shall be exercisable as a Non-Statutory Option
under the Federal tax laws.



            H.      The grant of options under the Plan shall in no way affect the right of the Corporation to
adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.



     IV.   CANCELLATION AND REGRANT OF OPTIONS




            The Plan Administrator shall have the authority to effect, at any time and from time to time,
with the consent of the affected option holders, the cancellation of any or all outstanding options
under the Plan and to grant in substitution therefor new options covering the same or different
number of shares of Common Stock but with an exercise price per share based on the Fair Market
Value per share of Common Stock on the new option grant date.



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ARTICLE THREE




STOCK ISSUANCE PROGRAM




     I.      STOCK ISSUANCE TERMS




            Shares of Common Stock may be issued under the Stock Issuance Program through direct and
immediate issuances without any intervening option grants. Each such stock issuance shall be
evidenced by a Stock Issuance Agreement that complies with the terms specified below.



            A.      Purchase Price.



                    1.      The purchase price per share shall be fixed by the Plan Administrator but shall not be less
than eighty-five percent (85%) of the Fair Market Value per share of Common Stock on the issue
date. However, the purchase price per share of Common Stock issued to a 10% Stockholder shall not
be less than one hundred and ten percent (110%) of such Fair Market Value.



                    2.      Subject to the provisions of Section I of Article Four, shares of Common Stock may be
issued under the Stock Issuance Program for any of the following items of consideration that the
Plan Administrator may deem appropriate in each individual instance:



                 (i)      cash or check made payable to the Corporation, or



                 (ii)     past services rendered to the Corporation (or any Parent or Subsidiary).



            B.      Vesting Provisions.



                    1.      Shares of Common Stock issued under the Stock Issuance Program may, in the discretion of
the Plan Administrator, be fully and immediately vested upon issuance or may vest in one or more
installments over the Participant’s period of Service or upon attainment of specified performance
objectives. However, the Plan Administrator may not impose a vesting schedule upon any stock
issuance effected under the Stock Issuance Program that is more restrictive than twenty percent
(20%) per year vesting, with initial vesting to occur not later than one (1) year after the
issuance date. Such limitation shall not apply to any Common Stock issuances made to the officers
of the Corporation, non-employee Board members or independent consultants.



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                    2.     Any new, substituted or additional securities or other property (including money paid other
than as a regular cash dividend) that the Participant may have the right to receive with respect to
the Participant’s unvested shares of Common Stock by reason of any stock dividend, stock split,
recapitalization, combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation’s receipt of consideration shall be
issued subject to (i) the same vesting requirements applicable to the Participant’s unvested shares
of Common Stock and (ii) such escrow arrangements as the Plan Administrator shall deem appropriate.



                    3.      The Participant shall have full stockholder rights with respect to any shares of Common
Stock issued to the Participant under the Stock Issuance Program, whether or not the Participant’s
interest in those shares is vested. Accordingly, the Participant shall have the right to vote such
shares and to receive any regular cash dividends paid on such shares.



                    4.      Should the Participant cease to remain in Service while holding one or more unvested shares
of Common Stock issued under the Stock Issuance Program or should the performance objectives not be
attained with respect to one or more such unvested shares of Common Stock, then those shares shall
be immediately surrendered to the Corporation for cancellation, and the Participant shall have no
further stockholder rights with respect to those shares. To the extent the surrendered shares were
previously issued to the Participant for consideration paid in cash or cash equivalent (including
the Participant’s purchase-money indebtedness), the Corporation shall repay to the Participant the
cash consideration paid for the surrendered shares and shall cancel the unpaid principal balance of
any outstanding purchase-money note of the Participant attributable to such surrendered shares.



                    5.      The Plan Administrator may in its discretion waive the surrender and cancellation of one or
more unvested shares of Common Stock (or other assets attributable thereto) that would otherwise
occur upon the non-completion of the vesting schedule applicable to those shares. Such waiver
shall result in the immediate vesting of the Participant’s interest in the shares of Common Stock
as to which the waiver applies. Such waiver may be effected at any time, whether before or after
the Participant’s cessation of Service or the attainment or non-attainment of the applicable
performance objectives.



                    6.      First Refusal Rights. Until such time as the Common Stock is first registered
under Section 12 of the 1934 Act, the Corporation shall have the right of first refusal with
respect to any proposed disposition by the Participant (or any successor in interest) of any shares
of Common Stock issued under the Stock Issuance Program. Such right of first refusal shall be
exercisable in accordance with the terms established by the Plan Administrator and set forth in the
document evidencing such right.



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     II.   CORPORATE TRANSACTION




            A.      Upon the occurrence of a Corporate Transaction, all outstanding repurchase rights under the
Stock Issuance Program shall terminate automatically, and the shares of Common Stock subject to
those terminated rights shall immediately vest in full, except to the extent: (i) those repurchase
rights are assigned to the successor corporation (or parent thereof) in connection with such
Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed by
the Plan Administrator at the time the repurchase right is issued.



            B.      The Plan Administrator shall have the discretionary authority, exercisable either at the
time the unvested shares are issued or any time while the Corporation’s repurchase rights with
respect to those shares remain outstanding, to provide that those rights shall automatically
terminate on an accelerated basis, and the shares of Common Stock subject to those terminated
rights shall immediately vest, in the event the Participant’s Service should subsequently terminate
by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18)
months) following the effective date of any Corporate Transaction in which those repurchase rights
are assigned to the successor corporation (or parent thereof).



     III.   SHARE ESCROW/LEGENDS




            Unvested shares may, in the Plan Administrator’s discretion, be held in escrow by the
Corporation until the Participant’s interest in such shares vests or may be issued directly to the
Participant with restrictive legends on the certificates evidencing those unvested shares.



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ARTICLE FOUR




MISCELLANEOUS




     I.      FINANCING




            The Plan Administrator may permit any Optionee or Participant to pay the option exercise price
under the Option Grant Program or the purchase price for shares issued under the Stock Issuance
Program by delivering a full-recourse, interest-bearing promissory note payable in one or more
installments and secured by the purchased shares. In no event may the maximum credit available to
the Optionee or Participant exceed the sum of (i) the aggregate option exercise price or purchase
price payable for the purchased shares (less the par value of those shares) plus (ii) any Federal,
state and local income and employment tax liability incurred by the Optionee or the Participant in
connection with the option exercise or share purchase.



     II.    EFFECTIVE DATE AND TERM OF PLAN




            A.      The Plan shall become effective when adopted by the Board, but no option granted under the
Plan may be exercised, and no shares shall be issued under the Plan, until the Plan is approved by
the Corporation’s stockholders. If such stockholder approval is not obtained within twelve (12)
months after the date of the Board’s adoption of the Plan, then all options previously granted
under the Plan shall terminate and cease to be outstanding, and no further options shall be granted
and no shares shall be issued under the Plan. Subject to such limitation, the Plan Administrator
may grant options and issue shares under the Plan at any time after the effective date of the Plan
and before the date fixed herein for termination of the Plan.



            B.      The Plan shall terminate upon the earliest of (i) the expiration of the ten
(10)-year period measured from the date the Plan is adopted by the Board, (ii) the date on which
all shares available for issuance under the Plan shall have been issued as vested shares or (iii)
the termination of all outstanding options in connection with a Corporate Transaction. All options
and unvested stock issuances outstanding at the time of a clause (i) termination event shall
continue to have full force and effect in accordance with the provisions of the documents
evidencing those options or issuances.



     III.   AMENDMENT OF THE PLAN




            A.      The Board shall have complete and exclusive power and authority to amend or modify the Plan
in any or all respects. However, no such amendment or modification shall adversely affect the
rights and obligations with respect to options or unvested stock issuances at the time outstanding
under the Plan unless the Optionee or the Participant consents to such amendment or modification.
In addition, certain amendments may require stockholder approval pursuant to applicable laws and
regulations.



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            B.     Options may be granted under the Option Grant Program and shares may be issued under the Stock
Issuance Program that are in each instance in excess of the number of shares of Common Stock then
available for issuance under the Plan, provided any excess shares actually issued under those
programs shall be held in escrow until there is obtained stockholder approval of an amendment
sufficiently increasing the number of shares of Common Stock available for issuance under the Plan.
If such stockholder approval is not obtained within twelve (12) months after the date the first
such excess grants or issuances are made, then (i) any unexercised options granted on the basis of
such excess shares shall terminate and cease to be outstanding and (ii) the Corporation shall
promptly refund to the Optionees and the Participants the exercise or purchase price paid for any
excess shares issued under the Plan and held in escrow, together with interest (at the applicable
Short Term Federal Rate) for the period the shares were held in escrow, and such shares shall
thereupon be automatically cancelled and cease to be outstanding.



     IV.   USE OF PROCEEDS




            Any cash proceeds received by the Corporation from the sale of shares of Common Stock under
the Plan shall be used for general corporate purposes.



     V.     WITHHOLDING




            The Corporation’s obligation to deliver shares of Common Stock upon the exercise of any
options granted under the Plan or upon the issuance or vesting of any shares issued under the Plan
shall be subject to the satisfaction of all applicable Federal, state and local income and
employment tax withholding requirements.



     VI.    REGULATORY APPROVALS




            The implementation of the Plan, the granting of any options under the Plan and the issuance of
any shares of Common Stock (i) upon the exercise of any option or (ii) under the Stock Issuance
Program shall be subject to the Corporation’s procurement of all approvals and permits required by
regulatory authorities having jurisdiction over the Plan, the options granted under it and the
shares of Common Stock issued pursuant to it.



     VII.   NO EMPLOYMENT OR SERVICE RIGHTS




            Nothing in the Plan shall confer upon the Optionee or the Participant any right to continue in
Service for any period of specific duration or interfere with or otherwise restrict in any way the
rights of the Corporation (or any Parent or Subsidiary employing or retaining such person) or of
the Optionee or the Participant, which rights are hereby expressly reserved by each, to terminate
such person’s Service at any time for any reason, with or without cause.



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     VIII. FINANCIAL REPORTS




            The Corporation shall deliver a balance sheet and an income statement at least annually to
each individual holding an outstanding option under the Plan, unless such individual is a key
Employee whose duties in connection with the Corporation (or any Parent or Subsidiary) assure such
individual access to equivalent information.



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APPENDIX




            The following definitions shall be in effect under the Plan:



            A.      Board shall mean the Corporation’s Board of Directors.



            B.      Code shall mean the Internal Revenue Code of 1986, as amended.



            C.      Committee shall mean a committee of two (2) or more Board members appointed by the
Board to exercise one or more administrative functions under the Plan.



            D.      Common Stock shall mean the Corporation’s common stock.



            E.      Corporate Transaction shall mean either of the following stockholder-approved
transactions to which the Corporation is a party:



                 (i)      a merger or consolidation in which securities possessing more than fifty
percent (50%) of the total combined voting power of the Corporation’s outstanding
securities are transferred to a person or persons different from the persons holding
those securities immediately prior to such transaction, or



                 (ii)     the sale, transfer or other disposition of all or substantially all of the
Corporation’s assets in complete liquidation or dissolution of the Corporation.



            F.      Corporation shall mean BeVocal, Inc., a Delaware corporation, and any successor
corporation to all or substantially all of the assets or voting stock of BeVocal, Inc. that shall
by appropriate action adopt the Plan.



            G.      Disability shall mean the inability of the Optionee or the Participant to engage
in any substantial gainful activity by reason of any medically determinable physical or mental
impairment and shall be determined by the Plan Administrator on the basis of such medical evidence
as the Plan Administrator deems warranted under the circumstances.



            H.      Employee shall mean an individual who is in the employ of the Corporation (or any
Parent or Subsidiary), subject to the control and direction of the employer entity as to both the
work to be performed and the manner and method of performance.



            I.      Exercise Date shall mean the date on which the Corporation shall have received
written notice of the option exercise.



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            J.     Fair Market Value per share of Common Stock on any relevant date shall be determined
in accordance with the following provisions:



                 (i)      If the Common Stock is at the time traded on the Nasdaq National Market,
then the Fair Market Value shall be the closing selling price per share of Common
Stock on the date in question, as such price is reported by the National Association
of Securities Dealers on the Nasdaq National Market. If there is no closing selling
price for the Common Stock on the date in question, then the Fair Market Value shall
be the closing selling price on the last preceding date for which such quotation
exists.



                 (ii)     If the Common Stock is at the time listed on any Stock Exchange, then the
Fair Market Value shall be the closing selling price per share of Common Stock on
the date in question on the Stock Exchange determined by the Plan Administrator to
be the primary market for the Common Stock, as such price is officially quoted in
the composite tape of transactions on such exchange. If there is no closing selling
price for the Common Stock on the date in question, then the Fair Market Value shall
be the closing selling price on the last preceding date for which such quotation
exists.



                 (iii)    If the Common Stock is at the time neither listed on any Stock Exchange
nor traded on the Nasdaq National Market, then the Fair Market Value shall be
determined by the Plan Administrator after taking into account such factors as the
Plan Administrator shall deem appropriate.



            K.      Incentive Option shall mean an option that satisfies the requirements of Code
Section 422.



            L.      Involuntary Termination shall mean the termination of the Service of any individual
that occurs by reason of:



                 (i)      such individual’s involuntary dismissal or discharge by the Corporation for
reasons other than Misconduct, or



                 (ii)     such individual’s voluntary resignation following (A) a change in his or
her position with the Corporation that materially reduces his or her duties and
responsibilities or the level of management to which he or she reports, (B) a
reduction in his or her level of compensation (including base salary, fringe
benefits and target bonuses under any corporate-performance based bonus or incentive
programs) by more than fifteen percent (15%) or (C) a relocation of such
individual’s place of employment by more than fifty (50) miles, provided and only if
such change, reduction or relocation is effected without the individual’s consent.



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            M.     Misconduct shall mean the commission of any act of fraud, embezzlement or dishonesty
by the Optionee or Participant, any unauthorized use or disclosure by such person of confidential
information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other
intentional misconduct by such person adversely affecting the business or affairs of the
Corporation (or any Parent or Subsidiary) in a material manner. The foregoing definition shall not
be deemed to be inclusive of all the acts or omissions that the Corporation (or any Parent or
Subsidiary) may consider as grounds for the dismissal or discharge of any Optionee, Participant or
other person in the Service of the Corporation (or any Parent or Subsidiary).



            N.      1934 Act shall mean the Securities Exchange Act of 1934, as amended.



            O.      Non-Statutory Option shall mean an option not intended to satisfy the requirements
of Code Section 422.



            P.      Option Grant Program shall mean the option grant program in effect under the Plan.



            Q.      Optionee shall mean any person to whom an option is granted under the Plan.



            R.      Parent shall mean any corporation (other than the Corporation) in an unbroken chain
of corporations ending with the Corporation, provided each corporation in the unbroken chain (other
than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the other corporations
in such chain.



            S.      Participant shall mean any person who is issued shares of Common Stock under the
Stock Issuance Program.



            T.      Plan shall mean the Corporation’s 1999 Stock Option/Stock Issuance Plan, as set
forth in this document.



            U.      Plan Administrator shall mean either the Board or the Committee acting in its
capacity as administrator of the Plan.



            V.      Service shall mean the provision of services to the Corporation (or any Parent or
Subsidiary) by a person in the capacity of an Employee, a non-employee member of the board of
directors or a consultant or independent advisor, except to the extent otherwise specifically
provided in the documents evidencing the option grant.



            W.      Stock Exchange shall mean either the American Stock Exchange or the New York Stock
Exchange.



            X.      Stock Issuance Agreement shall mean the agreement entered into by the Corporation
and the Participant at the time of issuance of shares of Common Stock under the Stock Issuance
Program.



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            Y.      Stock Issuance Program shall mean the stock issuance program in effect under the
Plan.



            Z.      Subsidiary shall mean any corporation (other than the Corporation) in an unbroken
chain of corporations beginning with the Corporation, provided each corporation (other than the
last corporation) in the unbroken chain owns, at the time of the determination, stock possessing
fifty percent (50%) or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.



            AA.    10% Stockholder shall mean the owner of stock (as determined under Code Section
424(d)) possessing more than ten percent (10%) of the total combined voting power of all classes of
stock of the Corporation (or any Parent or Subsidiary).




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