Document:

ADDENDUM TO FUNDING AGREEMENT

     This Addendum to Funding Agreement (hereinafter referred to as "ADDENDUM"),
dated  the 4th  day of  August,  2000 is by and  between  SYCONET.COM,  INC.,  a
Delaware Corporation (hereinafter referred to as "SYCD"), and ALLIANCE EQUITIES,
INC., a Florida Corporation  (hereinafter  referred to as "ALLIANCE").  SYCD and
ALLIANCE are sometimes referred to herein as the "Parties".

                                R E C I T A L S:

     WHEREAS,  SYCD and ALLIANCE  entered into that  certain  Funding  Agreement
dated December 16, 1999,  (hereinafter  referred to as the "FUNDING AGREEMENT");
and

     WHEREAS,  a dispute has arisen among the Parties to the FUNDING  AGREEMENT;
and

     WHEREAS,  the Parties are desirous of resolving all pending claims,  and/or
potential litigation and claims; and

     WHEREAS,  all of the Parties to this ADDENDUM to FUNDING AGREEMENT agree to
the terms and conditions as set forth hereafter.

     NOW,  THEREFORE,  in exchange for TEN ($10.00)  DOLLARS and other  valuable
consideration,  the receipt and sufficiency of which is hereby acknowledged, and
in  consideration  of the mutual  covenants  contained  herein which each of the
Parties is relying upon and intends to be bound by, enters into this ADDENDUM to
FUNDING AGREEMENT and agrees as follows:

     1.  Recitals.  The above  recitals  are true and  correct and have the same
force and effect as if fully set forth herein.

     2.  Representations  and Warranties of SYCD. In order to induce ALLIANCE to
enter into this ADDENDUM, SYCD hereby represents and warrants as follows:

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     a.  The  execution  of this  Addendum  by SYCD and the  performance  of the
requirements under this Addendum will not:

i. Violate any provision or law, regulation or any judgment,  writ,  injunction,
decree or any order of any Court or any other government  authority  relating to
SYCD;

ii. Violate any indenture, contract, or other commitment or restriction by which
SYCD is bound;

iii. Be in conflict  with,  result in or  constitute  a breach or default on the
part of SYCD of any indenture, contract or other commitment or restriction under
which they are bound; or

iv.  Result  in  the  breach  of  or  default  under  any  agreement,  contract,
undertaking or other instrument or documents.

     b. SYCD has the full power and authority to make,  deliver,  enter into and
perform all  obligations  pursuant to the terms and  conditions of this Addendum
and all exhibits  hereto and has taken all  necessary  action to  authorize  the
president of SYCD to execute,  deliver and perform on its behalf, the execution,
delivery and  performance  of the terms and  conditions  of this  Addendum,  its
exhibits, and all documents to be executed and delivered in connection with this
Addendum  or in  order  to  consummate  the  transaction  contemplated  by  this
Addendum;

     c. SYCD has freely and  voluntarily  entered into this Addendum and has had
the benefit of legal  counsel for all  negotiations  and drafting in  connection
with this Addendum;

     d.  SYCD  shall  use its  best  efforts  and  good  faith  to  perform  all
obligations created hereunder;

     e. All  warranties and  representations  by SYCD that are contained in this
Addendum are material to this Addendum are complete,  true and accurate,  can be
reasonably  relied  upon by ALLIANCE  without  further  investigation,  are made
freely,  voluntarily,  and  without  duress,  and are or have  been made for the
specific purpose of inducing ALLIANCE to enter into this Addendum.

     3.  Representation  and Warranties of ALLIANCE.  In order to induce SYCD to
enter into this Addendum, ALLIANCE hereby represents and warrants as follows:

     a. The  execution  of this  Addendum by  ALLIANCE  the  performance  of the
requirements under this Addendum will not:

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i. Violate any provision or law, regulation or any judgment,  writ,  injunction,
decree or any order of any Court or any other government  authority  relating to
ALLIANCE;

ii. Violate any indenture, contract, or other commitment or restriction by which
ALLIANCE is bound;

iii. Be in conflict  with,  result in or  constitute  a breach or default on the
part of ALLIANCE, of any indenture,  contract or other commitment or restriction
under which they are bound; or

iv.  Result  in  the  breach  of  or  default  under  any  agreement,  contract,
undertaking or other instrument or documents.

     b. ALLIANCE has the full power and authority to make,  deliver,  enter into
and  perform  all  obligations  pursuant  to the  terms and  conditions  of this
Addendum and all exhibits hereto and has taken all necessary action to authorize
ALLIANCE to execute, deliver and perform on its behalf, the execution,  delivery
and performance of the terms and conditions of this Addendum,  its exhibits, and
all documents to be executed and  delivered in connection  with this Addendum or
in order to consummate the transaction contemplated by this Addendum;

     c. ALLIANCE has freely and  voluntarily  entered into this Addendum and has
had the benefit of legal counsel for all negotiations and drafting in connection
with this Addendum;

     d.  ALLIANCE  shall use its best  efforts  and good  faith to  perform  all
obligations created hereunder;

     e. All  warranties  and  representations  by ALLIANCE that are contained in
this Addendum are material to this Addendum are complete, true and accurate, can
be  reasonably  relied  upon by SYCD  without  further  investigation,  are made
freely,  voluntarily,  and  without  duress,  and are or have  been made for the
specific purpose of inducing SYCD to enter into this Addendum.

     4.  Modifications  to Agreement.  The Parties hereby agree to modify and/or
amend the Funding Agreement between the Parties as follows:

     a. With respect to Paragraph 1,  Financing  Commitment,  the Parties hereby
agree that ALLIANCE's  maximum funding obligation to SYCD is hereby reduced from
an  aggregate  of TWO MILLION  ($2,000,000.00)  DOLLARS to an  aggregate  of ONE
MILLION  ($1,000,000.00)  DOLLARS.  SYCD  acknowledges  receipt of FIVE  HUNDRED
THOUSAND  ($500,000.00) DOLLARS previously funded in accordance with the Funding
Agreement and ALLIANCE  acknowledges  receipt of 1,269,492 shares of SYCD Common
Stock as repayment in full of such FIVE HUNDRED  THOUSAND  ($500,000.00)  DOLLAR
loan. ALLIANCE agrees to make the

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remaining FIVE HUNDRED THOUSAND  ($500,000.00) DOLLAR loan, in installments,  to
SYCD as follows:

i. ONE HUNDRED TWENTY-FIVE THOUSAND  ($125,000.00) DOLLARS upon the execution of
this Addendum by the Parties (the "Initial Funding Date"); and

ii. ONE HUNDRED TWENTY-FIVE THOUSAND  ($125,000.00)  DOLLARS two (2) weeks after
the Initial Funding Date (the "Second Funding Date"); and

iii. ONE HUNDRED TWENTY-FIVE THOUSAND  ($125,000.00) DOLLARS two (2) weeks after
the Second Funding Date (the "Third Funding Date"); and

iv. ONE  HUNDRED  THOUSAND  ($100,000.00)  DOLLARS two (2) weeks after the Third
Funding Date (the "Fourth Funding Date"); and

v.  TWENTY-FIVE  THOUSAND  ($25,000.00)  DOLLARS  two (2) weeks after the Fourth
Funding  Date as the final  payment,  in each case by wire  transfer  to SYCD of
available funds.

     b.  Provided  SYCD  receives  from  ALLIANCE  the ONE  HUNDRED  TWENTY-FIVE
THOUSAND  ($125,000.00) DOLLAR loan on the Initial Funding Date, within five (5)
days after such date,  SYCD shall issue to  ALLIANCE,  in repayment of the loan,
that number of shares of SYCD Common Stock valued at fifty (50%)  percent of the
closing bid price of SYCD's  Common Stock on the day  immediately  preceding the
date of SYCD's receipt of the subject loan funding  payment,  as shall equal the
principal amount of the loan installment. Following SYCD's receipt from ALLIANCE
of each subsequent loan  installment,  SYCD shall issue to ALLIANCE as repayment
of that loan installment,  within five (5) days after SYCD's receipt of the loan
proceeds  therefrom,  that number of shares of SYCD Common Stock valued at fifty
(50%)  percent  of the  closing  bid  price of  SYCD's  Common  Stock on the day
immediately  preceding  the date of SYCD's  receipt of the subject  loan funding
payment,  as shall equal the principal amount of the loan installment.  Inasmuch
as all loan  installments are to be repaid in shares of SYCD Common Stock,  each
loan installment shall not bear any interest. In the event SYCD is in default of
the obligations in this Section 4.b.,  ALLIANCE shall not be required to pay the
next loan  installment  due,  at  ALLIANCE's  sole  discretion,  and  thereafter
ALLIANCE shall be deemed to have fully  performed all of ALLIANCE's  obligations
under there terms of this  Addendum.  In the event ALLIANCE fails to make a loan
when due,  SYCD shall not be obligated to accept any late loan  installment.  In
the event SYCD fails to timely  repay the loan when due,  ALLIANCE  shall not be
obligated to accept any late loan payment.

     c. With respect to the current  prospectus status of SYCD as filed with the
Securities and Exchange Commission  ("SEC"),  the Parties hereby agree that upon
SYCD's   receipt  from  ALLIANCE  of  the  ONE  HUNDRED   TWENTY-FIVE   THOUSAND
($125,000.00)  DOLLAR loan  installment on the Initial  Funding Date, SYCD shall
use its best efforts to enable its counsel to file a Post-Effective

<PAGE>

Amendment to the SB-2 (or an entirely new SB filing,  if necessary),  disclosing
the terms of this  Addendum and such other  information  as said  counsel  deems
necessary under the Federal  Securities Law, within five (5) business days after
the Initial Funding Date in order to cause the  Post-Effective  Amendment to the
SB-2 to become effective as soon as practicable.  SYCD hereby further represents
and  warrants  that from the Initial  Funding  Date it will use best  efforts to
comply in all material  respects with all such applicable  federal,  state,  and
local laws as it relates to the  business of SYCD and its  continued  compliance
with  all  laws  and  regulations  as may be  imposed  by the  SEC or any  other
governing agency.

     d.  Furthermore,  the Parties  hereby  agree that the payment of the second
tranche of ONE HUNDRED TWENTY-FIVE THOUSAND  ($125,000.00)  DOLLARS constituting
the second payment,  or any future loan  installments  thereafter,  shall not be
funded by ALLIANCE  to SYCD until the  Post-Effective  Amendment  to the SB-2 is
declared effective by the SEC in writing. Furthermore, in the event that SYCD is
not current  with any and all of its filings  with the SEC,  including,  but not
limited to, filings of the 10-Q, 10-K or if SYCD receives an "E" suffix to their
trading  symbol,  then all further loan funding  payments will be suspended (the
"suspension  date") and  ALLIANCE  shall not be required to fund any future loan
installments  due, in its sole  discretion,  until after SYCD becomes current or
the "E" is removed,  and thereafter  ALLIANCE shall  recommence the loan funding
payments  as of  the  suspension  date,  so  long  as  SYCD  not in  default  as
hereinafter setforth, after all applicable cure period. Notwithstanding anything
to the contrary, SYCD shall be in default ("event of default") of this Addendum,
if (i), if SYCD does not file the Post-Effective  Amendment to the SB-2 with the
SEC  within   thirty  (30)  days  from  the  Initial   Funding   Date,   (ii)the
Post-Effective  Amendment to the SB-2 is not  declared  effective by the SEC, in
writing within sixty (60) days after filing the Post-Effective  Amendment to the
SB-2, or (iii) in the event, after sixty (60) days written notice from ALLIANCE,
SYCD is not  current in the with any and all of its  filings  with the SEC,  and
(iv) in the event,  after sixty (60) days written notice from ALLIANCE,  SYCD is
in  default  of any  other  obligation,  covenant,  representation  or  warranty
contained in this Addendum. In the event of SYCD's uncured default, ALLIANCE, in
its sole discretion, shall have the right to permanently suspend all future loan
installments,  and thereafter  ALLIANCE shall be deemed to have fully  performed
all of ALLIANCE's obligations under there terms of this Addendum.

ALLIANCE  acknowledges  that SYCD shall be late in its 10-Q  filing with the SEC
for the period ending June 30, 2000, due August 15, 2000.  Notwithstanding such,
ALLIANCE  shall not waive its  rights  to  declare  such late  filing by SYCD in
default of SYCD's obligations herein, and after the expiration of all applicable
cure periods, such shall be an event of default.

     e.  Upon  the  performance  of  ALLIANCE's  obligations  set  forth in this
Addendum,  the Parties hereby agree that any inducement  fee,  consulting fee or
any other previous  payment paid to ALLIANCE and/or EPSTEIN is deemed fully paid
and/or earned as may be applicable.

<PAGE>

     f.  Upon  the  performance  of  ALLIANCE's  obligations  set  forth in this
Addendum,  then SYCD,  upon  receipt of such  consideration,  by this  Addendum,
hereby remises, releases, acquits, satisfies and forever discharges ALLIANCE and
RICHARD EPSTEIN ("EPSTEIN") of and from all manner of action and actions,  cause
and causes of action, suits, debts, dues, sums of money,  accounts,  reckonings,
bonds, bills,  specialties,  covenants,  contracts,  controversies,  agreements,
promises, variances,  trespasses, damages, including, without limitation, claims
for lost profits,  consequential  damages and/or  punitive  damages,  judgments,
executions,  claims and demands whatsoever, in law or in equity, which SYCD, its
subsidiaries  and/or  affiliates,  ever  had,  now has,  or which  any  personal
representative,  successor,  heir or assign of SYCD, hereafter can, shall or may
have, against ALLIANCE or EPSTEIN,  for, upon or by reason of any matter,  cause
or  thing  whatsoever,  from  the  beginning  of the  world  to the date of this
Addendum.

     g. Upon the  performance of SYCD's  obligations set forth in this Addendum,
then ALLIANCE and EPSTEIN, upon receipt of such consideration, by this Addendum,
hereby remises, releases,  acquits, satisfies and forever discharges SYCD of and
from all manner of action and actions, cause and causes of action, suits, debts,
dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants,
contracts, controversies,  agreements, promises, variances, trespasses, damages,
judgments, executions, claims and demands whatsoever, in law or in equity, which
ALLIANCE, its subsidiaries and/or affiliates,  and EPSTEIN ever had, now has, or
which any personal representative,  successor, heir or assign of SYCD, hereafter
can,  shall or may have,  against  SYCD,  for,  upon or by reason of any matter,
cause or thing  whatsoever,  from the beginning of the world to the date of this
Addendum.

     h. SYCD shall have the right, at any time, to terminate  ALLIANCE's funding
obligations as set forth herein. In the event of any such termination,  ALLIANCE
shall have no further funding obligations to SYCD hereunder or under the Funding
Agreement,  and SYCD agrees to waive ALLIANCE's  breach of the Funding Agreement
for not making the FIVE HUNDRED THOUSAND  ($500,000.00) DOLLAR loan to SYCD upon
the effectiveness of SYCD's SB-2 and agrees not to seek damages against ALLIANCE
or EPSTEIN  and its  affiliates,  resulting  from such  breach,  and  thereafter
ALLIANCE shall be deemed to have fully  performed all of ALLIANCE's  obligations
under there terms of this Addendum.

     i. Except as expressly  set forth  herein,  all of the terms of the Funding
Agreement shall remain in full force and effect.

     5. Miscellaneous Provisions.

     a. Notices.  All notices  required or permitted to be given under the terms
of this Agreement shall be in writing.  Notices may be personally delivered to a
Party,  or may be given by fax if electronic  confirmation  of  transmission  is
obtained, or may be mailed to a Party. Notices are deemed given when received by
the Party

<PAGE>

being  noticed.  However  if a notice is mailed  to a Party by  certified  mail,
return receipt  requested,  proper postage prepaid,  in an envelope addressed to
the address of the Party set forth in the first  paragraph of this Agreement (or
such other address as may be  designated by a Party by giving notice  thereof to
all other Parties) then such notice shall be deemed given on the third day after
it is turned over to the custody of the United  States  Postal  Service.  SYCD's
number for notification via facsimile is (703) 366-3501,  and ALLIANCE's  number
for notification via facsimile is (954) 752-3216.

     b. Further  Assurances.  All Parties  shall  execute and deliver such other
instruments  and do such other acts as may be  necessary to carry out the intent
and purposes of this Agreement.

     c. Gender. Whenever the context may require, any pronouns used herein shall
include the corresponding masculine,  feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural and vice versa.

     d.  Counterparts.   This  Agreement  may  be  executed  in  any  number  of
counterparts.   All  executed   counterparts  shall  constitute  one  agreement,
notwithstanding  that all signatories are not signatories to the original or the
same counterpart.

     e. Captions.  The captions contained in this Agreement are inserted only as
a matter of  convenience  and in no way define,  limit,  extend or prescribe the
scope of this Agreement or the intent of any provision hereof.

     f.  Completeness  and  Modification.  This Addendum  constitutes the entire
understanding among the Parties concerning the subject matter hereof and, to the
extent  it  modifies  the  Funding   Agreement,   it  supersedes  all  prior  or
contemporaneous  agreements or understandings.  No waiver or modification of the
terms hereof shall be valid unless in writing  signed by the Party or Parties to
be charged and only to the extent therein set forth. No covenant, representation
or condition  not  expressed in this  Agreement  shall offset or be effective to
interpret, change or restrict the express provisions of this Agreement.

     g.  Severability.  The  invalidity  in  whole  or in part of any  covenant,
promise or undertaking, or any section, subsection, paragraph, sentence, clause,
phrase or word,  or of any  provision  of this  Agreement  shall not  affect the
validity of the remaining portions thereof.

     h.  Construction.  Each Party has reviewed  this  Agreement and the rule of
construction that ambiguities are to be resolved against the Party drafting this
Agreement shall not apply.

     i. Binding Effect. This Agreement shall be binding upon the heirs, personal
representatives,  guardians, legal representatives,  administrators, assigns and

<PAGE>

successors of the parties hereto.

     j. Time is of the Essence.  With respect to all of the  obligations of each
Party contained in this Agreement, time shall be of the essence.

     IN WITNESS WHEREOF the above parties have executed this ADDENDUM on the day
and date first above-written.

WITNESSES:                              ALLIANCE EQUITIES, INC.

                                        /s/ Richard Epstein
                                        ------------------------------
                                        RICHARD EPSTEIN, President

                                        SYCONET.COM, INC.

                                        /s/ William Spears
                                        ------------------------------
                                        WILLIAM SPEARS, President

                           JOINDER BY RICHARD EPSTEIN

The undersigned, Richard Epstein, individually, hereby joins in the provision of
Section 4.g. only

                                        /s/ Richard Epstein
                                        -------------------------------
                                        RICHARD EPSTEIN

6643.006 Amendment to Funding Agr.4SYCONET.COM, INC.
                 1997 INCENTIVE COMPENSATION PROGRAM, AS AMENDED

     1.  Purpose.  The  purpose  of  the  1997  Incentive  Compensation  Program
("Program")  is to increase  stockholder  value and to advance the  interests of
SyCo Comics and Distribution,  Inc. ("SYCD") and its subsidiaries (collectively,
the  "Company")  by  providing  a variety of  economic  incentives  designed  to
attract, retain and motivate directors, officers, other employees,  consultants,
independent   contractors  and  agents.  As  used  in  this  Program,  the  term
"subsidiary" means any business, whether or not incorporated,  in which SYCD has
a direct or indirect ownership interest.

     2. Administration.

     2.1  Administration by Committee.  The Program shall be administered by the
Compensation Committee of the SYCD Board of Directors ("Committee"), which shall
consist of two or more  non-employee  directors within the meaning of Rule 16b-3
of the  Securities  Exchange Act of 1934, as amended  ("Exchange  Act") who also
qualify  as outside  directors  within  the  meaning  of Section  162(m) and the
related regulations under the Internal Revenue Code of 1986, as amended,  except
as otherwise  determined by the Board of  Directors.  The Board of Directors may
also exercise any or all authority  otherwise  delegated to the Committee  under
the  terms  of the  Program  with  respect  to the  grant or  administration  of
incentives.

     2.2  Authority.  Subject to the  provisions  of the Program,  the Committee
shall have the  authority to (a) interpret  the  provisions of the Program,  and
prescribe,  amend, and rescind rules and procedures relating to the Program, (b)
grant  incentives  under the  Program,  in such forms and amounts and subject to
such  terms  and  conditions  as  it  deems  appropriate,   including,   without
limitation,  incentives  which are made in  combination  with or in tandem  with
other incentives (whether or not  contemporaneously  granted) or compensation or
in lieu of current or deferred compensation, (c) modify the terms of, cancel and
reissue, or repurchase  outstanding  incentives,  subject to Subsection 11.9(b),
(d) prescribe the form of agreement,  certificate or other instrument evidencing
any  incentive  under the  Program,  (e)  correct  any  defect or  omission  and
reconcile any  inconsistency in the Program or in any incentive  hereunder,  and
(f) make  all  other  determinations  and take  all  other  actions  as it deems
necessary or desirable for the administration of the Program; provided, however,
that in no event shall the Committee cancel any outstanding stock option for the
purpose of reissuing an option to the option holder at a lower  exercise  price.
The  determination  of the Committee on matters  within its  authority  shall be
conclusive and binding on the Company and all other persons. The Committee shall
comply with all applicable law in administering the Plan.

     3. Participation.  Subject to the terms and conditions of the Program,  the
Committee  shall  determine  and  designate  from  time  to time  the  directors
(including non-employee directors), officers and other employees of the Company,
persons expected to become directors, officers and other employees, consultants,
independent  contractors and agents of the Company who shall receive  incentives
under the Program ("Participants"). All employees of the Company are eligible to
receive incentives under the Program. Participation, the grant of incentives and
any related

<PAGE>

performance  goals for persons subject to Section 16(a) of the Exchange Act must
be  approved  by the  Committee.  The  Committee's  authority  with  respect  to
participation,  the grant of incentives and related  performance  objectives for
others (persons not subject to Section 16(a)) may be delegated.  For purposes of
the Program,  references to employment  shall also mean service as a director of
SYCD as well as an agency or independent contractor relationship.

     4. Shares Subject to the Program.

     4.1 Number of Shares Reserved. Shares of common stock, $.0001 par value, of
SYCD ("Common  Stock") shall be available for incentives  under the Program.  To
the extent  provided by resolution  of the SYCD Board of Directors,  such shares
may be uncertificated.  Subject to adjustment in accordance with Subsections 4.3
and 4.4, the aggregate number of shares of Common Stock available for incentives
under the Program shall be 2,500,000 shares.

     4.2 Type of  Common  Stock.  Common  Stock  issued  under  the  Program  in
connection  with Stock  Options and  Performance  Shares may be  authorized  and
unissued  shares or issued shares held as treasury  shares.  Common Stock issued
under the Program in connection with  Restricted  Stock or Stock Awards shall be
issued shares held as treasury shares;  provided,  however,  that authorized and
unissued  shares  may be issued in  connection  with  Restricted  Stock or Stock
Awards to the extent that the  Committee  determines  that past  services of the
Participant  constitute  adequate  consideration  for at  least  the  par  value
thereof.

     4.3  Reusage of Shares.

          (a)  In the  event  of the  exercise  or  termination  (by  reason  of
               forfeiture, expiration,  cancellation, surrender or otherwise) of
               any incentive under the Program,  that number of shares of Common
               Stock that was subject to the incentive  but not delivered  shall
               again be available for incentives under the Program.

          (b)  In the event that shares of Common Stock are delivered  under the
               Program as Restricted  Stock or pursuant to a Stock Award and are
               thereafter  forfeited or  reacquired  by the Company  pursuant to
               rights  reserved  upon  the  award  thereof,  such  forfeited  or
               reacquired  shares shall again be available for incentives  under
               the Program.

          (c)  Notwithstanding  the  provisions  of  paragraphs  (a) or (b), the
               following  shares of Common  Stock  shall  not be  available  for
               reissuance under the Program:  (1) shares which are withheld from
               any award or payment under the Program to satisfy tax withholding
               obligations  (as  described in  Subsection  11.5(e));  (2) shares
               which are surrendered to fulfill tax obligations (as described in
               Subsection  11.5(e));  and (3) shares  which are  surrendered  in
               payment of the Option Price (as defined in  Subsection  5.1) upon
               the exercise of a Stock Option.

                                       -2-

<PAGE>

     4.4  Adjustments  to  Shares   Reserved.   In  the  event  of  any  merger,
consolidation, reorganization,  recapitalization, spinoff, stock dividend, stock
split,  reverse stock split,  exchange,  or other  distribution  with respect to
shares  of  Common  Stock  or  other  change  in  the  corporate   structure  or
capitalization  affecting  the  Common  Stock,  the type and number of shares of
stock which are or may be subject to incentives under the Program,  the terms of
any outstanding  incentives (including the price at which shares of stock may be
issued  pursuant to an outstanding  incentive) and the  limitations set forth in
Sections 5.1, 6, 7.1, and 8.1 shall be equitably  adjusted by the Committee,  in
its sole  discretion,  to  preserve  the value of  incentives  awarded  or to be
awarded to Participants under the Program.

     5.   Stock Options.

     5.1  Awards.  Subject  to the  terms and  conditions  of the  Program,  the
Committee  shall  designate the employees to whom options to purchase  shares of
Common Stock  ("Stock  Options")  are to be awarded  under the Program and shall
determine the number, type, and terms of the Stock Options to be awarded to each
of them. Stock Option awards are subject to the following specific  limitations.
Each Stock Option shall expire on the earlier of the date provided by the option
terms or the date  which is 10 years and one day  after  the date of grant.  The
option price per share  ("Option  Price") for any Stock Option awarded shall not
be less than the  greater  of par value or the Fair  Market  Value of a share of
Common Stock on the date the Stock Option is awarded.  Each Stock Option awarded
under the Program shall be a "nonqualified stock option" for tax purposes unless
the  Stock  Option  satisfies  all of the  requirements  of  Section  422 of the
Internal  Revenue Code of 1986, as amended,  and the Committee  designates  such
Stock Option as an "Incentive  Stock Option".

     5.2 Manner of  Exercise.  A Stock Option may be  exercised,  in whole or in
part,  by giving  written  notice  to SYCD  prior to the date on which the Stock
Option  expires;  provided,  however,  that a Stock Option may only be exercised
with respect to whole  shares of Common  Stock.  Such notice  shall  specify the
number of shares of Common Stock to be  purchased  and shall be  accompanied  by
payment  of the  Option  Price for such  shares  in such form and  manner as the
Committee  may from time to time  approve,  provided,  however,  that  shares of
Common  Stock may not be used to pay any portion of the Option Price unless such
shares are shares of Common  Stock for which the holder  thereof has good title,
free and clear of all liens and  encumbrances  and which such holder  either (i)
has held for at least six months or (ii) has  purchased on the open market.  The
Committee may establish attestation  procedures to be used in lieu of the actual
delivery of shares in payment of the Option Price.

     5.3 Substitution of Cash.  Notwithstanding any provision in this Program to
the  contrary,  or any  provision  in any  agreement  evidencing  a Stock Option
awarded hereunder to the contrary,  in the event of a Change in Control pursuant
to  paragraph  (1) or (2) of  Subsection  11.10,  or in the event of a Change in
Control  pursuant to paragraph (3) or (4) of Subsection 11.10 in connection with
which the holders of Common  Stock  receive  consideration  other than shares of
common  stock that are  registered  under  Section 12 of the  Exchange  Act, the
Committee shall have the authority to require that any outstanding  Stock Option
be surrendered to the Company by the holder thereof for

                                       -3-

<PAGE>

cancellation  by the Company,  and the holder thereof shall receive,  within ten
days of the  occurrence  of such  Change in  Control,  a cash  payment  from the
Company in an amount  equal to the number of shares of Common Stock then subject
to such Stock Option,  multiplied  by the excess,  if any, of the greater of (A)
the highest per share price offered to  stockholders  of SYCD in any transaction
whereby  the Change in Control  takes  place or (B) the Fair  Market  Value of a
share of Common Stock on the date of occurrence  of the Change in Control,  over
the purchase price per share of Common Stock subject to the Stock Option.

     6. Stock Awards.  Subject to the terms and  conditions of the Program,  the
Committee  shall  designate the employees who shall be awarded  shares of Common
Stock  without  restrictions  ("Stock  Awards"),  under  the  Program  and shall
determine  the  number  and terms of the Stock  Awards to be  awarded to each of
them. Stock Awards are subject to the following specific limitations.  No person
subject to Section  16(a) of the Exchange Act may receive a Stock Award,  and no
person eligible to receive a Stock Award may receive a Stock Award.

     7.   Restricted Stock.

     7.1  Awards.  Subject  to the  terms and  conditions  of the  Program,  the
Committee shall designate the employees to whom shares of Common Stock,  subject
to  restrictions  ("Restricted  Stock"),  shall be awarded under the Program and
determine the number of shares and the terms and  conditions of each such award.
Each  Restricted  Stock award shall entitle the Participant to receive shares of
Common  Stock  upon the terms and  conditions  specified  by the  Committee  and
subject to the  following  provisions  of this Section 7 and the  provisions  of
Section 10.

     7.2  Restrictions.  All  shares of  Restricted  Stock  transferred  or sold
hereunder shall be subject to such  restrictions as the Committee may determine,
including, without limitation, any or all of the following:

          (a)  a required period of employment  with the Company,  as determined
               by  the  Committee,  prior  to  the  vesting  of  the  shares  of
               Restricted Stock;

          (b)  a prohibition  against the sale,  assignment,  transfer,  pledge,
               hypothecation  or other  encumbrance  of the shares of Restricted
               Stock for a specified period as determined by the Committee;

          (c)  a  requirement  that the  holder of shares  of  Restricted  Stock
               forfeit (or in the case of shares sold to a  Participant,  resell
               to the  Company at his or her cost) all or a part of such  shares
               in the event of termination  of his or her employment  during any
               period in which such shares are subject to restrictions; or

                                       -4-

<PAGE>

          (d)  a prohibition against employment of the holder of such Restricted
               Stock by any  competitor  of the Company or against such holder's
               dissemination of any secret or confidential information belonging
               to the Company.

All  restrictions on shares of Restricted  Stock awarded pursuant to the Program
shall expire at such time or times as the Committee shall specify.

     7.3 Registration of Shares.  Shares of Restricted Stock awarded pursuant to
the Program  shall be  registered  in the name of the  Participant  and, if such
shares are certificated, in the discretion of the Committee, may be deposited in
a bank  designated  by the  Committee or with SYCD.  The Committee may require a
stock power endorsed in blank with respect to shares of Restricted Stock whether
or not certificated.

     7.4 Stockholder Rights. Subject to the terms and conditions of the Program,
during any period in which shares of Restricted  Stock are subject to forfeiture
or  restrictions  on transfer,  each  Participant who has been awarded shares of
Restricted  Stock shall have such rights of a  stockholder  with respect to such
shares as the Committee  may  designate at the time of the award,  including the
right to vote  such  shares  and right to  receive  all  dividends  paid on such
shares. Unless otherwise provided by the Committee,  stock dividends or non-cash
dividends  and,  except as otherwise  provided by  Subsection  11.10,  any other
securities  distributed  with respect to Restricted Stock shall be restricted to
the same extent and subject to the same terms and  conditions as the  Restricted
Stock to which they are attributable.

     7.5 Lapse of  Restrictions.  Subject  to the terms  and  conditions  of the
Program,  at the end of any time period  during  which the shares of  Restricted
Stock are subject to forfeiture or restrictions on transfer, such shares will be
delivered free of all  restrictions to the Participant (or to the  Participant's
legal representative, beneficiary or heir).

     7.6  Substitution  of Cash.  The  Committee  may,  in its sole  discretion,
substitute cash equal to the Fair Market Value (determined as of the date of the
distribution) of shares of Common Stock otherwise  required to be distributed to
a Participant in accordance with this Section 7.

8.   Performance Shares.

     8.1 Awards.  A performance  share is an award which shall be paid in shares
of Common Stock, as described below.  Subject to the terms and conditions of the
Program,  the Committee shall designate the employees to whom Performance Shares
are to be awarded  in  accordance  with this  Section 8 and the number of shares
subject  to the award and the terms and  conditions  of such  awards.  Each
Performance  Share  awarded  pursuant  to  this  Section  8  shall  entitle  the
Participant  to a  payment  in the form of one share of  Common  Stock  upon the
attainment of such  performance  goals and other terms and  conditions as may be
specified by the Committee.

                                       -5-

<PAGE>

     8.2 No  Adjustments.  Except as  otherwise  provided by the  Committee,  no
adjustment  shall be made in  Performance  Shares  awarded  on  account  of cash
dividends which may be paid or other rights which may be provided to the holders
of Common Stock prior to the end of any period for which  performance goals were
established.

     8.3  Substitution  of Cash.  The  Committee  may,  in its sole  discretion,
substitute cash equal to the Fair Market Value (determined as of the date of the
issuance)  of  shares  of  Common  Stock  otherwise  required  to be issued to a
Participant in accordance with this Section 8.

     9. Other incentives.  In addition to the incentives described in Sections 5
through 8 above and  subject to the terms and  conditions  of the  Program,  the
Committee may grant other incentives ("Other Incentives"), payable in cash or in
kind,  under the  Program as it  determines  to be in the best  interest  of the
Company.

     10.  Performance  Goals  and  Application  of  Tax  Deduction  Limitations.
Compensation attributable to a Stock Option awarded to a Participant is intended
to satisfy the  requirements  of the exception  for qualified  performance-based
compensation  within the meaning of Section  162(m) and the related  regulations
under the Internal  Revenue Code of 1986,  as amended.  All awards of Restricted
Stock,  Performance  Shares, and Other Incentives under the Program,  to persons
subject to  Section  16(a) of the  Exchange  Act,  shall be made  subject to the
attainment of performance goals relating to one or more of the business criteria
within the meaning of Section 162(m) identified above, including but not limited
to, stock price,  market  share,  sales,  earnings per share,  return on equity,
costs, and cash flow, as determined by the Committee from time to time.

     11.  General.

     11.1 Effective Date. The Program will become effective upon its approval by
the  affirmative  vote of the holders of a majority of the voting  stock of SYCD
present in person or  represented  by proxy and  entitled  to vote  thereon at a
meeting of SYCD's  stockholders.  Unless approved within one year after the date
of the Program's  adoption by the Board of  Directors,  the Program shall not be
effective  for any  purpose.  Prior to the  approval  of the  Program  by SYCD's
stockholders,  the Committee may award  incentives,  but if such approval is not
received in the specified period, then such awards shall be of no effect.

     11.2  Duration.  The Program  shall remain in effect  until all  incentives
granted  under the Program have either been  satisfied by the issuance of shares
of Common Stock or the payment of cash or been terminated in accordance with the
terms of the  Program or the  incentive  and until all  restrictions  imposed on
shares of Common Stock issued under the Program have lapsed. No incentive may be
granted under the Program after the tenth anniversary of the date the Program is
approved by SYCD's stockholders.

     11.3  Non-transferability  of  Incentives.  No share of  Restricted  Stock,
Performance  Share,  or Other  Incentive  under the Program may be  transferred,
pledged, or assigned by the holder thereof (except, in the event of the holder's
death,  by will or the laws of descent and  distribution  to the limited  extent
provided in the Program or in the terms of the incentive), and the Company shall
not

                                       -6-

<PAGE>

be  required  to  recognize  any  attempted  assignment  of such  rights  by any
Participant.  Stock  Options  may be  transferred  by the holder  thereof to the
limited extent  authorized by rules and procedures  established by the Committee
from time to time.

     11.4 Effect of Termination of Employment or Death. If a Participant  ceases
to be an employee of the Company for any reason, including death, any incentives
then  outstanding  may be exercised or shall expire in accordance with the terms
of the incentive.

     11.5 Compliance with Applicable Law and Withholding.

          (a)  Notwithstanding  any other  provision of the Program,  SYCD shall
               have no  obligation to issue any shares of Common Stock under the
               Program if such issuance  would violate any applicable law or any
               applicable  regulation or requirement of any securities  exchange
               or similar entity.

          (b)  Prior to the  issuance  of any shares of Common  Stock  under the
               Program, SYCD or the Company may require a written statement that
               the recipient is acquiring the shares for  investment and not for
               the purpose or with the intention of distributing  the shares and
               that the  recipient  will not dispose of them in violation of the
               registration requirements of the Securities Act of 1933.

          (c)  With respect to any person who is subject to Section 16(a) of the
               Exchange Act, the Committee may, at any time, add such conditions
               and  limitations to any incentive or payment under the Program or
               implement  procedures for the administration of the Program which
               it deems  necessary or desirable to comply with the  requirements
               of Rule 16b-3 of the Exchange Act.

          (d)  If, at any time,  SYCD, in its sole  discretion,  determines that
               the listing,  registration,  or qualification (or any updating of
               any such  document)  of any type of  incentive,  or the shares of
               Common  Stock  issuable  pursuant  thereto,  is  necessary on any
               securities  exchange or under any federal or state  securities or
               blue sky law, or that the consent or approval of any governmental
               regulatory  body is necessary or desirable as a condition  of, or
               in  connection  with,  any  incentive,  the issuance of shares of
               Common  Stock  pursuant to any  incentive,  or the removal of any
               restrictions  imposed  on shares  subject to an  incentive,  such
               incentive  shall not be granted  and the  shares of Common  Stock
               shall not be issued or such restrictions shall not be removed, as
               the case  may be,  in whole  or in  part,  unless  such  listing,
               registration, qualification, consent, or approval shall have been
               effected or obtained  free of any  conditions  not  acceptable to
               SYCD.

          (e)  All  incentives  and  payments  under the  Program are subject to
               withholding  of all  applicable  taxes and the Company shall have
               the right to  withhold  from any award  under the  Program  or to
               collect as a condition of any payment

                                       -7-

<PAGE>

               under the Program, as applicable, any taxes required by law to be
               withheld. To the extent provided by the Committee,  a Participant
               may  elect  to  have  any  distribution,  or a  portion  thereof,
               otherwise required to be made under the Program to be withheld or
               to  surrender  to the Company  previously  owned shares of Common
               Stock to fulfill any tax withholding obligation.

     11.6 No Continued Employment. The Program does not constitute a contract of
employment or continued service,  and participation in the Program will not give
any  employee  or  Participant  the right to be  retained  in the  employ of the
Company or the right to  continue  as a director  of the Company or any right or
claim  to any  benefit  under  the  Program  unless  such  right  or  claim  has
specifically  accrued  under  the  terms  of the  Program  or the  terms  of any
incentive under the Program.

     11.7  Treatment as a  Stockholder.  No incentive  granted to a  Participant
under the Program shall create any rights in such  Participant  as a stockholder
of SYCD until shares of Common Stock related to the incentive are  registered in
the name of the Participant.

     11.8 Deferral  Permitted.  Payment of cash to a Participant or distribution
of any  shares of Common  Stock to which a  Participant  is  entitled  under any
incentive  shall be made as provided in the terms of the incentive.  Payment may
be  deferred  at the request of the  Participant  to the extent  provided in the
incentive.

     11.9  Amendment  of the  Program.  The  Board  may,  at any time and in any
manner,  amend,  suspend, or terminate the Program or any incentive  outstanding
under the Program;  provided,  however, that no such amendment or discontinuance
shall:

          (e)  be made without stockholder  approval to the extent such approval
               is required  by law,  agreement  or the rules of any  exchange or
               automated  quotation system upon which the Common Stock is listed
               or quoted;

          (2)  alter or  impair  the  rights of  Participants  with  respect  to
               incentives  previously made under the Program without the consent
               of the holder thereof; or

          (3)  make any  change  that  would  disqualify  awards  made under the
               Program, intended to be so qualified, from the exemption provided
               by Rule 16b-3 of the Exchange Act.

     11.10  Acceleration  of Incentives.  Notwithstanding  any provision in this
Program to the contrary or the normal terms of vesting in any incentive, (a) the
restrictions on all shares of Restricted Stock awarded shall lapse  immediately,
(b) all outstanding Stock Options will become exercisable  immediately,  and (c)
all performance  goals shall be deemed to be met and payment made immediately if
a Change in Control occurs.  For purposes of this Program, a "Change in Control"
shall have occurred if:

                                       -8-

<PAGE>

          (1)  any "Person",  as such term is used in Section 13(d) and 14(d) of
               the  Exchange  Act  (other  than  SYCD,  any  corporation  owned,
               directly  or  indirectly,   by  the   stockholders   of  SYCD  in
               substantially the same proportions as their ownership of stock of
               SYCD, and any trustee or other fiduciary holding securities under
               an employee  benefit plan of SYCD or such  proportionately  owned
               corporation), is or becomes the "beneficial owner" (as defined in
               Rule 13d-3 under the Exchange Act),  directly or  indirectly,  of
               securities  of SYCD  representing  30% or  more  of the  combined
               voting power of SYCD's then outstanding securities;

          (2)  during any period of not more than 24 months,  individuals who at
               the beginning of such period constitute the Board of Directors of
               SYCD, and any new director (other than a director designated by a
               Person who has entered  into an  agreement  with SYCD to effect a
               transaction  described  in  paragraph  (1),  (3) or  (4) of  this
               Subsection  11.10) whose  election by the board or nomination for
               election  by SYCD's  stockholders  was  approved  by a vote of at
               least two-thirds of the directors then still in office who either
               were  directors at the beginning of the period or whose  election
               or nomination for election was previously so approved,  cease for
               any reason to constitute at least a majority thereof;

          (3)  a merger or  consolidation  of SYCD  with any  other  corporation
               shall be  consummated,  other than (A) a merger or  consolidation
               which would result in the voting  securities of SYCD  outstanding
               immediately  prior  thereto  continuing  to represent  (either by
               remaining   outstanding   or  by  being   converted  into  voting
               securities of the surviving entity) more than 60% of the combined
               voting power of the voting  securities of SYCD or such  surviving
               entity    outstanding    immediately   after   such   merger   or
               consolidation,  or (B) a  merger  or  consolidation  effected  to
               implement a recapitalization of SYCD (or similar  transaction) in
               which no Person  acquires  more than 30% of the  combined  voting
               power of SYCD's then outstanding securities; or

          (4)  a plan  of  complete  liquidation  or  dissolution  of SYCD or an
               agreement  for  the  sale  or  disposition  by  SYCD  of  all  or
               substantially  all of SYCD's assets (or any transaction  having a
               similar effect) shall be consummated.

     11.11  Definition of Fair Market Value.  Except as otherwise  determined by
the Committee, the "Fair Market Value" of a share of Common Stock as of any date
shall be equal to the closing  sale price of a share of Common Stock as reported
by any  applicable  automated  quotation  system  or,  if there be none,  by any
recognized  reporter of closing  stock prices on the  applicable  date or, if no
sales of Common  Stock are reported on such date,  the closing  sales price of a
share of Common Stock on the date the Common Stock was last so reported.

                                       -9-

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