Document:

<PAGE>

                                                                    Exhibit 10.2

                          COMMERCIAL DEMAND GRID NOTE

$___________                                                       July 30, 2001
(Up to $5 million)                                             Chicago, Illinois

FOR VALUE RECEIVED, the undersigned (the "Borrower") unconditionally promises to
                                          --------
pay ON DEMAND to the order of Landmark Communications, Inc., a Virginia
corporation ("Lender"), without offset, at 150 W. Brambleton Avenue, Norfolk, VA
              ------
23510, or at such other place as the holder of this Commercial Demand Grid Note
("Note") may designate from time to time in writing, the unpaid principal amount
  ----
of all sums advanced and outstanding hereunder (the "Principal Amount
                                                     ----------------
Outstanding") as set forth on the attached Schedule of Advances and Payments of
-----------
Principal (the "Schedule"), together with interest on the Principal Amount
                --------
Outstanding from the date of each advance at the rate, and on the terms and
conditions, set forth below.  Each "Advance", as defined in that certain Amended
                                    -------
and Restated Loan and Security Agreement, dated the date hereof, between
Borrower and Lender (the "Loan Agreement"), shall, at Lender's option, be an
                          --------------
installment of principal advanced hereunder.  Lender shall be under no
obligation to make advances hereunder or under the Loan Agreement.  Capitalized
terms not otherwise defined herein shall have the meaning given such terms under
the Loan Agreement. All obligations under this Note shall be pari passu with the
Senior Secured Note, consistent with the Loan Agreement.

          1.   Demand Right; Payment of Note.  Lender may demand at any time
               -----------------------------
and from time to time in whole or in part the payment of the Principal Amount
Outstanding and all accrued and unpaid interest on the Note.

          2.   Interest; Default Rate.
               ----------------------

          (a)  The Principal Amount Outstanding shall bear interest at the rate
of eight percent (8%) per annum. Interest shall be computed on the actual number
of days elapsed on the basis of a year consisting of 360 days.

          (b)  Any amounts outstanding under this Note that shall have been
demanded by the Lender hereto and not paid shall bear interest from and after
the date of such applicable demand at the rate of sixteen (16%) per annum (the
"Demand Interest Rate"), increasing monthly by an annual rate which is one
 ---------------------
(1) percentage point above the then current Demand Interest Rate for each month
that any amounts outstanding under this Note remain overdue. Any interest on the
Note shall accrue and be compounded monthly until the obligation of Borrower,
with respect to the payment of such interest, has been discharged (whether
before or after judgment).

          (c)  Notwithstanding the foregoing, the effective annual rate under
this Note (including the Demand Interest Rate) shall not exceed a maximum annual
rate of twenty-four (24%) percent or the maximum annual rate permitted by law,
whichever is less.

          3.   Prepayment.  Borrower may prepay the Principal Amount
               ----------
Outstanding and all accrued interest under this Note at any time and from time
to time; provided, such

                                       1
<PAGE>

prepayment shall not cause a breach or event of default under Maker's agreements
with American National Bank and Trust Company of Chicago or be permitted at any
time that Borrower has failed to declare and pay all dividends required to be
declared and paid under Borrower's articles/certificate of incorporation; and,
provided, further, that payment of any outstanding principal or interest
(whether a prepayment or in response to a demand) shall not extinguish or
terminate this Note as it shall secure Borrower's obligations to pay Advances
under the Loan Agreement until the Loan Agreement has been terminated.

          4.   Application of Payments.  All payments made on this Note may be
               -----------------------
applied, at the option of Lender, first in payment of any costs or expenses of
Lender due hereunder, then in payment of any late charges due hereunder, then in
payment of any accrued and unpaid interest due hereunder, and any balance shall
be applied in payment of the Principal Amount Outstanding under this Note. At
Lender's sole discretion, Lender may forgive any portion of any principal or
interest amounts due under this Note and unpaid as effective payment of any
portion of the exercise price of any warrants to purchase common stock of the
Borrower that Lender then holds and wishes to exercise. Each payment tendered to
Lender on this Note shall be payable in lawful money of the United States which
shall be legal tender for public and private debts at the time of payment. Any
check given in payment of any amounts due hereunder will constitute a payment
only when collected. In the event Lender shall incur any cost or expense or make
any advance or other disbursement under the terms and conditions of any document
or instrument relating to the indebtedness of Borrower to Lender evidenced by
this Note or any document or instrument providing Lender with any security for
the payment of this Note, then, any payment made to Lender under this Note may
be applied, at the option of Lender, first to the payment of any such cost,
expense, advance or disbursement and all interest due thereon, and the balance,
if any, of such payment applied as aforesaid towards the payment of any amounts
then due and payable under this Note.

          5.   Waivers. Borrower waives presentment, demand, protest, notice of
               -------
dishonor and all other notices of every kind and nature to which Borrower would
otherwise be entitled under the applicable law. Borrower agrees that Lender may
take any one or more of the following actions, on one or more occasions, whether
before or after the maturity of this Note, without any notice to Borrower,
without any further consent to such actions, and without releasing or
discharging Borrower from liability on the Note:

          (a)  Any extension or extensions of the time of payment of any
principal, interest or other amount due and payable under this Note;

          (b)  Any renewal of this Note, in whole or in part;

          (c)  Any full or partial release or discharge from liability under
this Note of any other Borrower;

          (d)  Any release, in whole or in part, of any security for the payment
of all or any portion of the amounts due under this Note;

          (e)  Any waiver of any default under any Loan Document;

                                       2
<PAGE>

          (f)  Any failure or refusal of Lender to (i) realize on any security
which Lender may have for the payment of this Note, (ii) institute any suit or
action against Borrower under this Note, (iii) exercise any other right or
remedy available to Lender under this Note or applicable law, or any delay by
Lender in realizing on any such security, in instituting any such suit or
action, or in exercising any other such right or remedy;

          (g)  Any agreement with Borrower changing the rate of interest or any
other term or condition of this Note; or

          (h)  Any failure or refusal of Lender to obtain or maintain a valid,
perfected and enforceable lien against any real and/or personal property
securing the payment of this Note, in whole or in part.

     To the fullest extent permitted by law, Borrower waives the benefit of all
laws and rules of law intended for his protection or advantage as a party liable
on this Note or providing for its release or discharge from liability upon the
failure or refusal of Lender to perform certain acts, including, but not limited
to, the realization by Lender on any security for the payment of this Note and
any law and any rule of law requiring Lender to institute any suit or action on
this Note, but excluding any statute of limitations applicable to the collection
or enforcement of this Note.

          6.   Security.  This Note is secured as provided in the Loan
               --------
Agreement.

          7.   Completion of Schedule.  It is understood and agreed that any
               ----------------------
officer or authorized employee of Lender may make entries on the Schedule (and
on any supplemental schedules attached hereto) (i) upon receipt of written or
telephonic instructions of any one reasonably believed by such officer or
authorized employees to be an authorized agent of Borrower or (ii) when an
Advance is made pursuant to the Loan Agreement. Borrower shall indemnify and
hold Lender harmless from and against any and all claims, damages, losses, costs
and expenses (including attorneys' fees) which may arise or be created by the
acceptance of instructions for making or paying advances by telephone. The
Principal Amount Outstanding shown on the Schedule shall be prima facie evidence
of the principal amount owing and unpaid on this Note. The failure to record the
date an amount of any advance on the Schedule shall not, however, limit or
otherwise affect the obligations of Borrower under this Note to repay the
principal amount of the advance together with all interested accruing thereon.

          8.   Events of Default.  Any Event of Default under the Loan
               -----------------
Agreement shall constitute an event of default under this Note.

          9.   Acceleration; Remedies.  Upon an event of default, the entire
               ----------------------
Principal Amount Outstanding, and all accrued and unpaid interest, and all other
sums required under this Note and the Loan Agreement shall, notwithstanding the
stated maturity in this Note, become immediately due and payable, without notice
or demand to Borrower. Upon default, Lender shall have the right, immediately
and without notice to Borrower or the taking of any other action, to set-off
against this Note, all liabilities of Lender to Borrower and all obligations for
money or money's worth owed by Lender to Borrower, whether or not due, without
notice to Borrower (such liabilities and obligations including, without
limitation, all money, stocks, bonds or other security or property of any kind
or nature held by or in the possession of Lender to or for

                                       3
<PAGE>

the credit of Borrower); and Lender shall be deemed to have made a charge
against any such liabilities or obligations immediately upon the occurrence of
any event of default under this Note even though such charge is subsequently
made or entered on the behalf of Lender. The remedies provided in this Note upon
default and in other agreement between Lender and Borrower are cumulative and
not exclusive of any other remedies provided under the Loan Agreement or at law
or in equity.

          10.  Additional Provisions.
               ---------------------

          (a)  To the extent permitted by generally accepted accounting
principles, Borrower will treat, account and report the Note as debt and not
equity for accounting purposes and with respect to any returns filed with
federal, state or local tax authorities.

          (b)  No delay or omission by Lender in exercising or enforcing any of
Lender's powers, rights, privileges, remedies, or discretions hereunder shall
operate as a waiver thereof on that occasion nor on any other occasion. No
waiver of any default hereunder shall operate as a waiver of any other default
hereunder, nor as a continuing waiver.

          (c)  Borrower, and each endorser and guarantor, if any, of this Note,
shall indemnify, defend, and hold Lender harmless against any claim brought or
threatened against Lender by Borrower (other than a claim which is finally
judicially determined against Lender), by any endorser or guarantor, or by any
other person (as well as from attorneys' reasonable fees and expenses in
connection therewith) on account of Lender's relationship with Borrower or any
endorser or guarantor hereof (each of which may be defended, compromised,
settled or pursued by Lender with counsel of Lender's selection, but at the
expense of Borrower and any endorser and/or guarantor).

          (d)  Borrower will pay on demand all attorneys' reasonable fees and
out-of-pocket expenses incurred by Lender in the administration of all
Liabilities and obligations of Borrower to Lender, including, without
limitation, costs and expenses associated with travel on behalf of Lender.
Borrower will also pay on demand, without limitation, all attorneys' reasonable
fees, out-of-pocket expenses incurred by Lender's attorneys and all costs
incurred by Lender, including, without limitation, costs and expenses associated
with travel on behalf of Lender, which costs and expenses are directly or
indirectly related to the protection or enforcement of any of Lender's rights
against Borrower or any such endorser or guarantor and against any collateral
given Lender to secure this Note or any other Liabilities of Borrower or such
endorser and guarantor to Lender (whether or not suit is instituted by or
against Lender).

          (e)  Borrower, and each endorser and guarantor of this Note,
respectively waives presentment, demand, notice, and protest, and also waives
any delay on the part of the holder hereof. Each assents to any extension or
other indulgence (including, without limitation, the release or substitution of
collateral) permitted Borrower or any endorser or guarantor by Lender with
respect to this Note and/or any collateral given to secure this note or any
extension or other indulgence, as described above, with respect to any other
liability or any collateral given to secure any other liability of Borrower or
any endorser or guarantor to Lender.

                                       4
<PAGE>

          (f)  This Note shall be binding upon Borrower and each endorser and
guarantor hereof and upon their respective heirs, successors, assigns, and
representatives, and shall inure to the benefit of Lender and its successors,
endorsees, and assigns.

          (g)  The liabilities of Borrower and any endorser or guarantor of this
Note are joint and several; provided, however, that the release by Lender of
Borrower or any one or more endorser or guarantor shall not release any other
person obligated on account of this Note. Each reference in this Note to
Borrower, any endorser, and any guarantor, is to such person individually and
also to all such persons jointly. No person obligated on account of this Note
may seek contribution from any other person also obligated unless and until all
liabilities, obligations and indebtedness to Lender of the person from whom
contribution is sought have been satisfied in full.

          (h)  Borrower and each endorser and guarantor hereof each authorizes
Lender to complete this Note if delivered incomplete in any respect.

          (i)  This Note is delivered to Lender at its offices at 150 W.
Brambleton Avenue, Norfolk, VA 23510, shall be governed by the laws of the State
of Illinois, and shall take effect as a sealed instrument. Borrower and each
endorser and guarantor of this Note each submits to the jurisdiction of the
courts of the State of Illinois for all purposes with respect to this Note, any
collateral given to secure their respective liabilities, obligations and
indebtedness to Lender, and their respective relationships with Lender. Any
determination that any provision of this Note or any application thereof is
invalid, illegal or unenforceable in any respect in any instance shall not
affect the validity, legality or enforceability of such provision in any other
instance, or the validity, legality or enforceability of any other provision of
this Note.

          (j)  The undersigned makes the following waiver knowingly,
voluntarily, and intentionally, and understands that Lender, in the
establishment and maintenance of Lender's relationship with Borrower
contemplated by the within Note, is relying thereon. THE UNDERSIGNED, TO THE
EXTENT ENTITLED THERETO, WAIVES ANY PRESENT OR FUTURE RIGHT OF THE UNDERSIGNED,
                         ------
OR OF ANY GUARANTOR OR ENDORSER OF THE UNDERSIGNED OR OF ANY OTHER PERSON LIABLE
TO LENDER ON ACCOUNT OF OR IN RESPECT TO THE LIABILITIES, TO A TRIAL BY JURY IN
ANY CASE OR CONTROVERSY IN WHICH LENDER IS OR BECOMES A PARTY (WHETHER SUCH CASE
OR CONTROVERSY IS INITIATED BY OR AGAINST LENDER OR IN WHICH LENDER IS JOINED AS
A PARTY LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF, OR IS IN RESPECT TO,
ANY RELATIONSHIP AMONGST OR BETWEEN THE UNDERSIGNED, ANY SUCH PERSON, AND
LENDER.

          (k)  Borrower has read all of the terms and conditions of this Note
and acknowledges receipt of an exact copy of it.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK-
                            SIGNATURE PAGE FOLLOWS]

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<PAGE>

     WITNESS the following signature(s) and seal(s):

                              COOLSAVINGS.COM INC.

                              By: /s/ Matthew Moog
                                 ---------------------------------
                                 Name: Matthew Moog
                                      ----------------------------
                                 Title: President
                                       ---------------------------

ATTEST:

   /s/ John Adams
--------------------------
Name: John J. Adams
     ---------------------
Title: EVP, Operations &
        Technology
      --------------------

                                       6
<PAGE>

                 SCHEDULE OF ADVANCES AND PAYMENTS OF PRINCIPAL

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                                                                  Principal            Approving
                                                                    Amount              Person's
       Date                 Advance            Payment           Outstanding            Initials

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<S>                 <C>                  <C>                  <C>                  <C>
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                                       7<PAGE>

                                                                    Exhibit 10.3

                              coolsavings.com inc.

                             2001 STOCK OPTION PLAN

                                   Article I.
                        Purpose and Adoption of the Plan
                        --------------------------------

     1.01 Purpose. The purpose of the coolsavings.com inc. Stock Option Plan
(the "Plan") is to provide certain employees and Consultants of coolsavings.com
inc., a Michigan corporation (the "Company"), with an additional incentive to
promote the Company's financial success and to provide an incentive which the
Company may use to induce able persons to enter into or remain in the service of
the Company or a Subsidiary.

     1.02 Adoption and Term. This Stock Option Plan was approved by the
Company's board of directors on, and is effective as of, July 12, 2001, subject
to approval the Company's stockholders on or before July 12, 2002 and will
remain in effect until all shares authorized under the terms of the Plan have
been issued, unless earlier terminated or abandoned by action of the Board;
provided, however, that no Incentive Stock Option may be granted after July 12,
2011.

                                   Article II.
                                   Definitions
                                   -----------

     2.01 Administrator means the group of persons having authority to
administer the Plan pursuant to Section 3.01.

     2.02 Award means any one or combination of Non-Qualified Stock Options,
Performance Based Options, Incentive Stock Options, Stock Appreciation Rights,
Restricted Share Rights or any other award made under the terms of the Plan.

     2.03 Award Agreement means a written agreement between the Company and
Participant or a written acknowledgment from the Company specifically setting
forth the terms and conditions of an Award granted under the Plan.

     2.04 Award Period means, with respect to an Award, the period of time set
forth in the Award Agreement during which specified conditions set forth in the
Award Agreement must be satisfied.

     2.05 Beneficiary means (a) an individual, trust or estate who or which, by
will or by operation of the laws of descent and distribution, succeeds to the
rights and obligations of the Participant under the Plan and Award Agreement
upon the Participant's death; or (b) an individual, who by designation of the
Participant, succeeds to the rights and obligations of the Participant under the
Plan and Award Agreement upon the Participant's death.

     2.06 Board means the Board of Directors of the Company.

     2.07 Change of Control Event means a sale of all or substantially all of
the Company's assets, or any merger or consolidation of the Company with or into
another entity other than a merger or consolidation in which the holders of more
than 50% of the shares of capital stock of the Company outstanding immediately
prior to such transaction continue to hold (either by the voting securities
remaining outstanding or by their being converted into voting securities of the
surviving entity) more than 50% of the total voting power represented by the
voting securities of the Company, or such surviving entity, outstanding
immediately after such transaction. Notwithstanding anything to the contrary
herein or in any Award Agreement, no transaction contemplated by the Securities
Purchase Agreement, dated July 30, 2001, among the
<PAGE>

Company, Landmark Communications, Inc. and Landmark Ventures VII, LLC shall
constitute a Change of Control Event.

     2.08 Code means the Internal Revenue Code of 1986, as amended. References
to a section of the Code shall include that section and any comparable section
or sections of any future legislation that amends, supplements or supersedes
that section.

     2.09 Common Stock means the Common Stock of the Company, no par value.

     2.10 Company means coolsavings.com inc., a Michigan corporation.

     2.11 Consultant means any person, including an advisor, who renders
services to the Company or any Subsidiary and is compensated for such services,
and any Director whether or not compensated for such services.

     2.12 Date of Grant means the date designated by the Administrator as the
date as of which it grants an Award, which shall not be earlier than the date on
which the Administrator approves the granting of such Award.

     2.13 Director means a member of the Board of Directors of the Company.

     2.14 Exchange Act means the Securities Exchange Act of 1934, as amended.

     2.15 Exercise Price means, with respect to a Stock Appreciation Right, the
amount established by the Administrator, in accordance with Section 7.03
hereunder, and set forth in the Award Agreement, which is to be subtracted from
the Fair Market Value on the date of exercise in order to determine the amount
of the Incremental Value to be paid to the Participant.

     2.16 Expiration Date means the date specified in an Award Agreement as the
expiration date of such Award.

     2.17 Fair Market Value means, on any given date, the fair market value of
the Common Stock as determined in good faith by the Board; provided, however,
that: (a) if the Common Stock is admitted to quotation on the National
Association of Securities Dealers Automated Quotation System ("Nasdaq")
Small-Cap Market on the date the Option is granted, the Fair Market Value means
the average of the highest bid and lowest asked prices of the Common Stock on
Nasdaq reported for such date; (b) if the Common Stock is admitted to trading on
a national securities exchange or the Nasdaq National Market on the date the
Option is granted, the Fair Market Value means the closing price reported for
the Common Stock on such exchange or system for such date or, if no sales were
reported for such date, for the last date preceding such date for which a sale
was reported; and (c) if the Common Stock is quoted on the Nasdaq System (but
not on the National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high bid and low asked price for the Common Stock
for the date of determination (or if no bids occurred on the date of
determination, on the last trading day prior to the date of determination).

     2.18 Incentive Stock Option means a stock option described in Section 422
of the Code.

     2.19 Incremental Value has the meaning given such term in Section 7.01 of
the Plan.

                                      -2-
<PAGE>

     2.20 Non-Qualified Stock Option means a stock option which is not an
Incentive Stock Option.

     2.21 Officer means a chief executive officer, president, executive vice
president, chief financial officer, treasurer, and any other person who performs
functions corresponding to the foregoing officers for the Company, and any other
participant who is deemed to be an officer of the Company for purposes of
Section 16 of the Exchange Act and the rules thereunder, as currently in effect
or as amended from time to time.

     2.22 Options means all Non-Qualified Stock Options, Incentive Stock Options
and Performance Based Options granted at any time under the Plan.

     2.23 Participant shall have the meaning set forth in Article V.

     2.24 Performance Based Option means a stock option which, upon exercise or
at any other time, would not result in or give rise to "applicable employee
remuneration" within the meaning of Section 162(m) of the Code.

     2.25 Plan means the coolsavings.com inc. 2001 Stock Option Plan, as
described herein and as it may be amended from time to time.

     2.26 Purchase Price, with respect to options, shall have the meaning set
forth in Section 6.02.

     2.27 Restricted Share Right means a right to receive Common Stock subject
to restrictions imposed under the terms of an Award granted pursuant to Article
IX.

     2.28 Rule 16b-3 means Rule 16b-3 promulgated by the Securities and Exchange
Commission under Section 16 of the Exchange Act, as currently in effect and as
it may be amended from time to time, and any successor rule.

     2.29 Stock Appreciation Right means an Award granted in accordance with
Article VII.

     2.30 Subsidiary shall have the meaning set forth in Section 424(f) of the
Code.

     2.31 Termination of Service means the voluntary or involuntary cessation of
a Participant's employment with, or service to, the Company for any reason,
including death, disability, retirement or as the result of the divestiture of
the Participant's employer or any other similar transaction in which the
Participant's employer ceases to be the Company or a Subsidiary of the Company.
Whether an authorized leave of absence or absence on military or government
service, absence due to disability, or absence for any other reason shall
constitute Termination of Service shall be determined in each case by the
Administrator in its sole discretion. Unless otherwise determined by the
Administrator, a change in status from an employee to a Consultant or from a
Consultant to an employee will not constitute a Termination of Service.

     2.32 Trading Day means a day on which public trading of securities occurs
and is reported in the principal consolidated reporting system referred to in
Section 2.17 above, or if the Common Stock is not listed or admitted to trading
on a national securities exchange or included for quotation on the Nasdaq
National Market, any business day.

                                      -3-
<PAGE>

                                  Article III.
                                 Administration
                                 --------------

     3.01 Administration. The Plan shall be administered by the Board or, to the
extent determined by the Board, a committee (the "Compensation Committee")
consisting of not less than two non-employee directors of the Company (within
the meaning of Rule 16b-3) to be appointed by, and to serve at the pleasure of,
the Board (in either case, the "Administrator"). It is the intention of the
Company that, with respect to Awards designated as Performance Based Options,
each of the members of the Compensation Committee shall also be "outside
directors" within the meaning of Section 162(m) of the Code. The Administrator
shall administer the Plan in accordance with this provision and shall have the
sole discretionary authority to interpret the Plan, to establish and modify
administrative rules for the Plan, to impose such conditions and restrictions on
Awards as it determines appropriate, to cancel Awards (including those made
pursuant to other plans of the Company) and to substitute new options (including
options granted under other plans of the Company) with the consent of the
recipient, and to take such steps in connection with the Plan and Awards granted
thereunder as it may deem necessary or advisable. The Administrator may, with
respect to Participants who are not Officers, delegate such of its powers and
authority under the Plan as it deems appropriate to designated officers or
employees of the Company.

     3.02 Indemnification. Members of the Administrator shall be entitled to
indemnification and reimbursement from the Company for any action or any failure
to act in connection with service as Administrator to the full extent provided
for or permitted by the Company's articles of incorporation or bylaws or by any
insurance policy or other agreement intended for the benefit of the Company's
officers, directors or employees or by any applicable law.

                                   Article IV.
                   Common Stock Issuable Pursuant to the Plan
                   ------------------------------------------

     4.01 Shares Issuable. Shares to be issued under the Plan may be authorized
and unissued shares or issued shares which have been reacquired by the Company.
Except as provided in Section 4.03, the Awards granted to any Participant and to
all Participants in the aggregate under the Plan shall be limited so that the
sum of the following shall never exceed the sum of (A) 7,953,954 shares plus (B)
up to 1,800,000 shares issued in connection with the cancellation of options
issued under the Company's 1997 Stock Option Plan, as such cancellation and
issuance is contemplated by that certain Securities Purchase Agreement, dated
July 30, 2001, among the Company, Landmark Communications, Inc. and Landmark
Ventures VII, LLC: (i) all shares which shall be issued upon the exercise of
outstanding Options or other Awards granted under the Plan, (ii) all shares for
which payment of Incremental Value shall be made by reason of the exercise of
Stock Appreciation Rights at any time granted under the Plan, and (iii) the
number of shares otherwise issuable under an Award which are applied by the
Company to payment of the withholding or tax liability discussed in Section
11.04.

                                      -4-
<PAGE>

     4.02 Shares Subject to Terminated Awards. In the event that any Award at
any time granted under the Plan shall be surrendered to the Company, be
terminated or expire before it shall have been fully exercised, or an award of
Stock Appreciation Rights is exercised for cash, then all shares formerly
subject to such Award as to which such Award shall not have been exercised shall
be available for any Award subsequently granted in accordance with the Plan.
Shares of Common Stock subject to Options, or portions thereof, which have been
surrendered in connection with the exercise of tandem Stock Appreciation Rights
shall not be available for subsequent Awards under the Plan, and shares of
Common Stock issued in payment of such Stock Appreciation Rights shall be
charged against the number of shares of Common Stock available for the grant of
Awards. Shares which are reacquired by the Company or shares issuable subject to
Restricted Share Rights which are forfeited pursuant to forfeiture provisions in
the Award Agreement shall be available for subsequently granted Awards only if
the forfeiting Participant received no benefits of ownership (such as dividends
actually paid to the Participant) other than voting rights of the forfeited
shares. Any shares of Common Stock issued by the Company pursuant to its
assumption or substitution of outstanding grants from acquired companies shall
not reduce the number of shares available for Awards under this Plan unless
issued under this Plan.

     4.03 Adjustments to Reflect Capital Changes.

          (a) Recapitalization. The number and kind of shares subject to
     outstanding Awards, the Purchase Price or Exercise Price for such shares,
     and the number and kind of shares available for Awards subsequently granted
     under the Plan shall be appropriately adjusted to reflect any stock
     dividend, stock split, combination or exchange of shares, merger,
     consolidation or other change in capitalization with a similar substantive
     effect upon the Plan or the Awards granted under the Plan. The
     Administrator shall have the power to determine the amount of the
     adjustment to be made in each case.

          (b) Sale or Reorganization. After any reorganization, merger or
     consolidation in which the Company is a surviving corporation, each
     Participant shall, at no additional cost, be entitled upon exercise of an
     Award to receive (subject to any required action by stockholders), in lieu
     of the number of shares of Common Stock receivable or exercisable pursuant
     to such Award, a number and class of shares of stock or other securities to
     which such Participant would have been entitled pursuant to the terms of
     the reorganization, merger or consolidation if, at the time of such
     reorganization, merger or consolidation, such Participant had been the
     holder of record of a number of shares of Common Stock equal to the number
     of shares receivable or exercisable pursuant to such Award. Comparable
     rights shall accrue to each Participant in the event of successive
     reorganizations, mergers or consolidations of the character described
     above.

          (c) Options to Purchase Stock of Acquired Companies. After any
     reorganization, merger or consolidation in which the Company or a
     Subsidiary of the Company shall be a surviving corporation, the
     Administrator may grant substituted Options under the provisions of the
     Plan, pursuant to Section 424 of the Code, replacing old options granted
     under a plan of another party to the reorganization, merger or
     consolidation, where such party's stock may no longer be issued following
     such merger or consolidation. The foregoing adjustments and manner of
     application of the foregoing provisions shall be determined by the
     Administrator in its sole discretion. Any adjustments may provide for the
     elimination of any fractional shares which might otherwise have become
     subject to any Awards.

                                      -5-
<PAGE>

                                   Article V.
                                  Participation
                                  -------------

     5.01 Eligible Participants. Participants in the Plan shall be the employees
and Consultants of the Company or any Subsidiary, as determined and selected
from time to time by the Administrator, in its sole and absolute discretion. The
Administrator's designation of a Participant in any year shall not require the
Administrator to designate such person to receive Awards in any other year. The
Administrator shall consider such factors as it deems pertinent in selecting
Participants and in determining the type and amount of their respective Awards.

                                   Article VI.
                                  Option Awards
                                  -------------

     6.01 Power to Grant Options. The Administrator may grant, to such
Participants as the Administrator may select, Options entitling the Participant
to purchase Common Stock from the Company at such price, in such quantity and on
such terms and subject to such conditions, not inconsistent with the terms of
this Plan, as may be established by the Administrator. The terms of any Option
granted under this Plan shall be set forth in an Award Agreement.
Notwithstanding the foregoing, Options granted to Officers shall not be
exercisable for a period of at least six months from the Date of Grant unless
otherwise specifically approved by the Board.

     6.02 Purchase Price of Options. The Purchase Price of each share of Common
Stock which may be purchased upon exercise of any Option granted under the Plan
shall be equal to or greater than the Fair Market Value on the Date of Grant;
provided, however, that the Purchase Price of each share of Common Stock which
may be purchased upon exercise of a Non-Qualified Stock Option shall be no less
than ninety percent (90%) of the Fair Market Value on the Date of Grant if such
discount is expressly granted in lieu of a reasonable amount of salary or bonus;
provided, further, that the Purchase Price for shares of Common Stock purchased
pursuant to Stock Options designated by the Administrator as Incentive Stock
Options shall be equal to or greater than the Fair Market Value on the Date of
Grant as required under Section 422 of the Code and provided further that the
Purchase Price for shares of Common Stock purchased pursuant to Stock Options
designated by the Administrator as Performance Based Options shall be equal to
or greater than the Fair Market Value on the Date of Grant.

     6.03 Designation of Incentive Stock Options. Except as otherwise expressly
provided in the Plan, the Administrator may designate, at the Date of Grant of
each Option to a Participant that is an employee of the Company or a Subsidiary,
that the Option is an Incentive Stock Option under Section 422 of the Code.

          (a) Incentive Stock Option Share Limitation. No Participant may be
     granted Incentive Stock Options under the Plan (or any other plans of the
     Company) which would result in stock with an aggregate Fair Market Value
     (measured on the Date of Grant) of more than $100,000 first becoming
     exercisable in any one calendar year, or which would entitle such
     Participant to purchase a number of shares greater than the maximum number
     permitted by Section 422 of the Code as in effect on the Date of Grant.

          (b) Other Incentive Stock Option Terms. Whenever possible, each
     provision in the Plan and in every Option granted under this Plan which is
     designated by the Administrator as an Incentive Stock Option shall be
     interpreted in such a manner as to entitle the Option to the tax treatment
     afforded by Section 422 of the Code. If any provision of this Plan or any
     Option designated by the Administrator as an Incentive

                                      -6-
<PAGE>

     Stock Option shall be held not to comply with requirements necessary to
     entitle such Option to such tax treatment, then (i) such provision shall be
     deemed to have contained from the outset such language as shall be
     necessary to entitle the Option to the tax treatment afforded under Section
     422 of the Code, and (ii) all other provisions of this Plan and the Award
     Agreement shall remain in full force and effect. If any agreement covering
     an Option designated by the Administrator to be an Incentive Stock Option
     under this Plan shall not explicitly include any terms required to entitle
     such Incentive Stock Option to the tax treatment afforded by Section 422 of
     the Code, all such terms shall be deemed implicit in the designation of
     such Option and the Option shall be deemed to have been granted subject to
     all such terms.

     6.04 Designation of Performance Based Options. Except as otherwise
expressly provided in the Plan, the Administrator may designate, at the Date of
Grant of each Option to a Participant that is an employee of the Company or a
Subsidiary, that the Option is a Performance Based Option. A Performance Based
Option shall have a Purchase Price not less than the Fair Market Value on the
Date of Grant and shall contain such other terms and conditions as the
Administrator may deem necessary so that, upon exercise or at any other time,
the Performance Based Option does not result in or give rise to "applicable
employee remuneration" within the meaning of Section 162(m) of the Code.

     6.05 Rights as a Stockholder. The Participant or any transferee of an
Option pursuant to Section 8.02 or Section 11.05 shall have no rights as a
stockholder with respect to any shares of Common Stock covered by an Option
until the Participant or transferee shall have become the holder of record of
any such shares, and no adjustment shall be made for dividends and cash or other
property or distributions or other rights with respect to any such shares of
Common Stock for which the record date is prior to the date on which the
Participant or a transferee of the Option shall have become the holder of record
of any such shares covered by the Option.

                                  Article VII.
                            Stock Appreciation Rights
                            -------------------------

     7.01 Power to Grant Stock Appreciation Rights. The Administrator is
authorized to grant to any Participant, on such terms established by the
Administrator on or prior to the Date of Grant and subject to and not
inconsistent with the provisions of this Plan, the right to receive the payment
from the Company, payable as provided in Section 7.04, of an amount equal to the
Incremental Value of the Stock Appreciation Rights, which shall be an amount
equal to the remainder derived from subtracting (i) the Exercise Price for the
right established in the Award Agreement from (ii) the Fair Market Value of a
share of Common Stock on the date of exercise. The terms of any Stock
Appreciation Right granted under the Plan shall be set forth in an Award
Agreement.

     7.02 Tandem Stock Appreciation Rights. The Administrator may grant to any
Participant a Stock Appreciation Right consistent with the provisions of this
Plan covering any share of Common Stock which is, at the Date of Grant of the
Stock Appreciation Right, also covered by an Option granted to the same
Participant, either prior to or simultaneously with the grant to such
Participant of the Stock Appreciation Right, provided: (i) any Option covering
any share of Common Stock shall expire and not be exercisable upon the exercise
of any Stock Appreciation Right with respect to the same share; (ii) any Stock
Appreciation Right covering any share of Common Stock shall not be exercisable
upon the exercise of any related Option with respect to the same share; and
(iii) an Option and Stock Appreciation Right covering the same share of Common
Stock may not be exercised simultaneously.

                                      -7-
<PAGE>

     7.03 Exercise Price. The Exercise Price established under any Stock
Appreciation Right granted under this Plan shall be determined by the
Administrator and, in the case of a tandem Stock Appreciation Right, shall not
be less than the Purchase Price of the related Option. Upon exercise of the
Stock Appreciation Rights, the number of shares subject to exercise under a
related Option shall automatically be reduced by the number of shares of Common
Stock represented by the Option or portion thereof which is surrendered as a
result of the exercise of such Stock Appreciation Rights.

     7.04 Payment of Incremental Value. Any payment which may become due from
the Company by reason of Participant's exercise of a Stock Appreciation Right
may be paid to the Participant as determined by the Administrator (i) all in
cash, (ii) all in Common Stock, or (iii) in any combination of cash and Common
Stock. In the event that all or a portion of the payment is made in Common
Stock, the number of shares of the Common Stock delivered in satisfaction of
such payment shall be determined by dividing the amount of the payment by the
Fair Market Value on the date of exercise. The Administrator may determine
whether payment upon exercise of a Stock Appreciation Right will be made in cash
or in stock, or a combination thereof, upon or at any time prior to the exercise
of such Stock Appreciation Right. No fractional share of Common Stock shall be
issued to make any payment; if any fractional shares would be issuable, the mix
of cash and Common Stock payable to the Participant shall be adjusted as
directed by the Administrator to avoid the issuance of any fractional share.
Payment may be made in cash to Officers only if the Stock Appreciation Right is
exercised during the "window period" required under Rule 16b-3(e)(3) and
otherwise in accordance with Rule 16b-3.

                                  Article VIII.
                 Terms of Options and Stock Appreciation Rights
                 ----------------------------------------------

     8.01 Duration of Options and Stock Appreciation Rights. Options and Stock
Appreciation Rights shall terminate after the first to occur of the following
events:

          (a) Expiration Date of the Award as provided in the Award Agreement;
     or

          (b) Termination of the Award as provided in Section 8.02; or

          (c) In the case of an Incentive Stock Option, ten years from the Date
     of Grant; or

          (d) Solely in the case of tandem Stock Appreciation Rights, upon the
     Expiration Date of the related Option.

     8.02 Exercise on Death or Termination of Service.

          (a) Unless otherwise provided in the Award Agreement, in the event of
     a Termination of Service as a result of the death of a Participant, the
     right to exercise all unexpired Awards shall be accelerated and shall
     accrue as of the date of death, and the Participant's Awards may be
     exercised by his Beneficiary at any time within one year after the date of
     the Participant's death.

          (b) Unless otherwise provided in the Award Agreement, in the event of
     a Participant's Termination of Service at any time for any reason
     (including disability or retirement) other than death or for "cause" (as
     defined in paragraph (d) below), an Award may be exercised, but only to the
     extent it was otherwise exercisable, on the date of Termination of Service,
     within ninety days after the date of Termination of Service. In the event
     of the death of the Participant within the ninety-day period following

                                      -8-
<PAGE>

     Termination of Service, his Award may be exercised by his Beneficiary
     within the one year period provided in subparagraph (a) above.

          (c) With respect to an Award which is intended to constitute an
     Incentive Stock Option, upon Termination of Service, such Award shall be
     exercisable as provided in Section 422 of the Code.

          (d) In the event that a Participant's Termination of Service is for
     "cause", all Awards shall terminate immediately upon Termination of
     Service. If such Participant has a written employment and/or consulting
     agreement with the Company, "cause" shall be as defined in such agreement.
     In the absence of a written employment and/or consulting agreement, a
     Termination of Service shall be deemed to have been for "cause" if such
     termination is determined, in the sole discretion of the Administrator, to
     have resulted from: (i) the Participant's commission of fraud,
     embezzlement, theft, or a crime involving moral turpitude, in any case
     whether or not involving the Company, that in the opinion of the
     Administrator renders Participant's continued employment detrimental to the
     Company or its reputation, (ii) the substantial or repeated failure or
     refusal of the Participant to perform according to reasonable expectations
     and standards set by the Board and/or management consistent with
     Participant's title and position, or (iii) Participant's conviction of a
     felony.

     8.03 Acceleration of Exercise Time. The Administrator, in its sole
discretion, shall have the right (but shall not in any case be obligated) to
permit purchase of shares under any Award prior to the time such Award would
otherwise become exercisable under the terms of the Award Agreement.

     8.04 Extension of Exercise Time. The Administrator, in its sole discretion,
shall have the right (but shall not in any case be obligated) to permit any
Award granted under this Plan to be exercised after its Expiration Date or after
the ninety day period following Termination of Employment or service on the
Board, subject, however, to the limitations described in Section 8.01 (c) and
(d).

     8.05 Conditions for Exercise. An Award Agreement may contain such waiting
periods, exercise dates and restrictions on exercise (including, but not limited
to, periodic installments which may be cumulative) as may be determined by the
Administrator at the Date of Grant. No Stock Appreciation Right may be exercised
prior to six months from the Date of Grant.

     8.06 Change of Control Event. Unless otherwise provided in the Award
Agreement, and subject to such other terms and conditions as the Administrator
may establish in the Award Agreement, in the event that a Participant's
employment or service to the Company is terminated by the Company without
"cause" within two years following the occurrence of a Change of Control Event,
irrespective of whether or not an Award is then exercisable, the Participant
shall have the right to exercise in full any unexpired Award as of the date of
such termination of employment or service.

     8.07 Exercise Procedures. Each Option and Stock Appreciation Right granted
under the Plan shall be exercised by written notice to the Company which must be
received by the officer of the Company designated in the Award Agreement on or
before the Expiration Date of the Award. The Purchase Price of shares purchased
upon exercise of an Option granted under the Plan shall be paid in full in cash
by the Participant pursuant to the Award Agreement; provided, however, that the
Administrator may (but need not) permit payment to be made by delivery to the
Company of either (a) shares of Common Stock that either have been owned by

                                      -9-
<PAGE>

the Participant for at least six months prior to such delivery (or such other
period as may be required to avoid a charge to the Company's earnings) or were
not acquired, directly or indirectly, from the Company, (b) any combination of
the foregoing methods of payment, or (c) such other consideration as the
Administrator deems appropriate and in compliance with applicable law (including
payment in accordance with a cashless exercise program under which, if so
instructed by the Participant, shares of Common Stock may be issued directly to
the Participant's broker or dealer upon receipt of the Purchase Price in cash
from the broker or dealer). In the event that any Common Stock shall be
transferred to the Company to satisfy all or any part of the Purchase Price, the
part of the Purchase Price deemed to have been satisfied by such transfer of
Common Stock shall be equal to the product derived by multiplying the Fair
Market Value as of the date of exercise times the number of shares transferred.
The Participant may not transfer to the Company in satisfaction of the Purchase
Price (y) a number of shares which when multiplied times the Fair Market Value
as of the date of exercise would result in a product greater than the Purchase
Price or (z) any fractional share of Common Stock. Any part of the Purchase
Price paid in cash upon the exercise of any Option shall be added to the general
funds of the Company and used for any proper corporate purpose. Unless the
Administrator shall otherwise determine, any Common Stock transferred to the
Company as payment of all or part of the Purchase Price upon the exercise of any
Option shall be held as treasury shares.

                                   Article IX.
                             Restricted Stock Awards
                             -----------------------

     9.01 Restricted Share Awards. The Administrator may grant to any
Participant an Award of Restricted Share Rights entitling such person to receive
shares of Common Stock in such quantity, and on such terms, conditions and
restrictions (whether based on performance standards, periods of service or
otherwise) as the Administrator shall determine on or prior to the Date of
Grant. The terms of any Award of Restricted Share Rights granted under the Plan
shall be set forth in an Award Agreement.

     9.02 Duration of Restricted Share Rights. In no event shall any Restricted
Share Rights granted entitle the holder to receive shares of Common Stock free
of all restrictions on transfer at any time prior to the expiration of three
years from the Date of Grant, and each Award Agreement shall provide that the
Participant shall remain employed by the Company or a Subsidiary for that three
year period (subject to the Company's or Subsidiary's right to terminate such
employment).

     9.03 Forfeiture of Restricted Share Rights. Subject to Section 9.05, all
Restricted Share Rights shall be forfeited and all Restricted Share Awards shall
terminate unless the Participant continues in the service of the Company or a
Subsidiary until the expiration of the forfeiture and satisfies any other
conditions set forth in the Award Agreement. If the Award Agreement shall so
provide, in the case of death, disability or retirement (as defined in the Award
Agreement) of the Participant, all of the shares covered by the Restricted Share
Rights shall immediately vest and any restrictions shall lapse as of the date of
such death, disability or retirement.

     9.04 Delivery of Shares Upon Vesting. Upon the lapse of the restrictions
established in the Award Agreement, the Participant shall be entitled to
receive, without payment of any cash or other consideration, certificates for
the number of shares covered by the Award.

     9.05 Waiver or Modification of Forfeiture Provisions. The Administrator has
full power and authority to modify or waive any or all terms, conditions or
restrictions (other than the minimum restriction period set forth in Section
9.02) applicable to any Restricted Share Rights granted to a Participant under
the Plan; provided that no modification shall, without consent of

                                      -10-
<PAGE>

the Participant, adversely affect the Participant's rights thereunder and no
modification shall reduce the employment requirement to less than three years,
except in the case of death, disability or retirement.

     9.06 Rights as a Stockholder. No person shall have any rights as a
stockholder with respect to any shares subject to Restricted Share Rights until
such time as the person shall have been issued a certificate for such shares.

                                   Article X.
                            Other Stock Based Awards
                            ------------------------

     10.01 Grant of Other Awards. Other Awards of Common Stock or other
securities of the Company and other Awards that are valued in whole or in part
by reference to, or are otherwise based on, Common Stock ("Other Awards") may be
granted either alone or in addition to or in conjunction with Options or Stock
Appreciation Rights under the Plan. Subject to the provisions of the Plan, the
Administrator shall have the sole and complete authority to determine the
persons to whom and the time or times at which Other Awards shall be made, the
number of shares of Common Stock or other securities, if any, to be granted
pursuant to such Other Awards, and all other conditions of such Other Awards.
Any Other Award shall be confirmed by an Award Agreement executed by the
Administrator and the Participant, which agreement shall contain such provisions
as the Administrator determines to be necessary or appropriate to carry out the
intent of this Plan with respect to the Other Award.

     10.02 Terms of Other Awards. In addition to the terms and conditions
specified in the Award Agreement, Other Awards made pursuant to this Article X
shall be subject to the following:

          (a) Any shares of Common Stock subject to such Other Awards may not be
     sold, assigned, transferred or otherwise encumbered prior to the date on
     which the shares are issued, or, if later, the date on which any applicable
     restriction, performance or deferral period lapses; and

          (b) If specified by the Administrator and the Award Agreement, the
     recipient of an Other Award shall be entitled to receive, currently or on a
     deferred basis, interest or dividends or dividend equivalents with respect
     to the Common Stock or other securities covered by the Other Award; and

          (c) The Award Agreement with respect to any Other Award shall contain
     provisions providing for the disposition of such Other Award in the event
     of Termination of Employment prior to the exercise, realization or payment
     of such Other Award, with such provisions to take account of the specific
     nature and purpose of the Other Award.

                                   Article XI.
                         Terms Applicable to All Awards
                         ------------------------------

     11.01 Award Agreement. The grant and the terms and conditions of the Award
shall be set forth in an Award Agreement between the Company and the
Participant. No person shall have any rights under any Award granted under the
Plan unless and until the Administrator and the Participant to whom the Award is
granted shall have executed and delivered an Award Agreement expressly granting
the Award to such person and setting forth the terms of the Award.

     11.02 Plan Provisions Control Award Terms. The terms of the Plan shall
govern

                                      -11-
<PAGE>

all Awards granted under the Plan, and in no event shall the Administrator have
the power to grant any Award under the Plan which is contrary to any of the
provisions of the Plan. In the event any provision of any Award granted under
the Plan shall conflict with any term in the Plan as constituted on the Date of
Grant of such Award, the term in the Plan as constituted on the Date of Grant of
such Award shall control. Except as provided in Section 4.03, (i) the terms of
any Award granted under the Plan may not be changed after the granting of such
Award without the express approval of the Participant and (ii) no modification
may be made to an Award granted to an Officer except in compliance with Rule
16b-3.

     11.03 Modification of Award After Grant. Each Award granted under the Plan
to a Participant other than an Officer may be modified after the date of its
grant by express written agreement between the Company and the Participant,
provided that such change (i) shall not be inconsistent with the terms of the
Plan and (ii) shall be approved by the Administrator. No modifications may be
made to any Awards granted to an Officer except in compliance with Rule 16b-3.

     11.04 Taxes. The Company shall be entitled, if the Administrator deems it
necessary or desirable, to withhold (or secure payment from the Participant in
lieu of withholding) the amount of any withholding or other tax required by law
to be withheld or paid by the Company with respect to any amount payable and/or
shares issuable under such Participant's Award, or with respect to any income
recognized upon a disqualifying disposition of shares received pursuant to the
exercise of an Incentive Stock Option, and the Company may defer payment or
issuance of the cash or stock upon exercise or vesting of an Award unless
indemnified to its satisfaction against any liability for such tax. The amount
of such withholding or tax payment shall be the Company's minimum statutory
withholding obligations as determined by the Administrator and, unless otherwise
provided by the Administrator, shall be payable by the Participant at the time
of issuance or payment in accordance with the following rules:

          (a) A Participant shall have the right to elect to meet his or her
     withholding requirement by: (1) having the Company withhold from such Award
     the appropriate number of shares of Common Stock, rounded up to the next
     whole number, the Fair Market Value of which is equal to such amount, or,
     in the case of the cash payment, the amount of cash, as is determined by
     the Company to be sufficient to satisfy the Company's minimum statutory tax
     withholding requirements; or (2) direct payment to the Company in cash of
     the amount of any taxes required to be withheld with respect to such Award.

          (b) In the event that an Award or property received upon exercise of
     an Award has already been transferred to the Participant on the date upon
     which withholding requirements apply, the Participant shall pay directly to
     the Company the cash amount determined by the Company to be sufficient to
     satisfy applicable federal, state or local withholding requirements. The
     Participant shall provide to the Company such information as the Company
     shall require to determine the amounts to be withheld and the time such
     withholding requirements become applicable.

          (c) If permitted under applicable federal income tax laws, a
     Participant may elect to be taxed in the year in which an Award is
     exercised or received, even if it would not otherwise have become taxable
     to the Participant. If the Participant makes such an election, the
     Participant shall promptly notify the Company in writing and shall provide
     the Company with a copy of the executed election form as filed with the
     Internal Revenue Service no later than thirty days from the date of
     exercise or receipt. Promptly following such notification, the Participant
     shall pay directly to the Company the cash amount determined by the Company
     to be sufficient to satisfy applicable federal, state or local withholding
     tax requirements.

                                      -12-
<PAGE>

     11.05 Limitations on Transfer. A Participant's rights and interest under
the Plan may not be assigned or transferred other than by will or the laws of
descent and distribution. Notwithstanding the foregoing, or any other provision
of this Plan, a Participant who holds Non-Qualified Stock Options may transfer
such Options to his or her spouse, lineal ascendants, lineal descendants, or to
a duly established trust for the benefit of one or more of these individuals.
Options so transferred may thereafter be transferred only to the Participant who
originally received the Options or to an individual or trust to whom the
Participant could have initially transferred the Option pursuant to this Section
11.05. Options which are transferred pursuant to this Section 11.05 shall be
exercisable by the transferee according to the same terms and conditions as
applied to the Participant.

     11.06 General Restriction. Notwithstanding anything to the contrary herein,
the Company shall have no obligation or liability to deliver any shares of
Common Stock under the Plan or to make any other distribution of benefits under
the Plan unless such delivery or distribution would comply with all applicable
laws, rules and regulations, including, without limitation, the Securities Act
of 1933, as amended, and the Exchange Act.

     11.07 Surrender of Awards. Any Award granted under the Plan may be
surrendered to the Company for cancellation on such terms as the Administrator
and Participant approve, including, but not limited to, terms which provide that
upon such surrender the Company will pay to the Participant cash or Common
Stock, or a combination of cash and Common Stock.

                                  Article XII.
                               General Provisions
                               ------------------

     12.01 Amendment and Termination of Plan.

          (a) Amendment. The Board shall have complete power and authority to
     amend the Plan at any time and to add any other stock based Award or other
     incentive compensation programs to the Plan as it deems necessary or
     appropriate and no approval by the stockholders of the Company or by any
     other person, committee or entity of any kind shall be required to make any
     amendment; provided, however, that the Board shall not, without the
     requisite affirmative approval of the stockholders of the Company, (i) make
     any amendment which requires stockholder approval under any applicable law,
     including Rule 16b-3 or the Code; or (ii) which, unless approved by the
     requisite affirmative approval of stockholders of the Company, would cause,
     result in or give rise to "applicable employee remuneration" within the
     meaning of Section 162(m) of the Code with respect to any Performance Based
     Option. No termination or amendment of the Plan may, without the consent of
     the Participant to whom any Award shall theretofore have been granted under
     the Plan, adversely affect the right of such individual under such Award.
     For the purposes of this section, an amendment to the Plan shall be deemed
     to have the affirmative approval of the stockholders of the Company if such
     amendment shall have been submitted for a vote by the stockholders at a
     duly called meeting of such stockholders at which a quorum was present and
     the majority of votes cast with respect to such amendment at such meeting
     shall have been cast in favor of such amendment.

          (b) Termination. The Board shall have the right and the power to
     terminate the Plan at any time. If the Plan is not earlier terminated, the
     Plan shall terminate when all shares authorized under the Plan have been
     issued. No Award shall be granted under the Plan after the termination of
     the Plan, but the termination of the Plan shall not have any other effect
     and any Award outstanding at the time of the termination of the Plan may be
     exercised after termination of the Plan at any time prior to the expiration
     date of such

                                      -13-
<PAGE>

     Award to the same extent such award would have been exercisable if the Plan
     had not been terminated.

     12.02 No Right To Employment. No employee or other person shall have any
claim or right to be granted an Award under this Plan. Neither the Plan nor any
action taken hereunder shall be construed as giving any employee any right to be
retained in the employ of the Company or a Subsidiary of the Company.

     12.03 Compliance with Rule 16b-3. It is intended that the Plan be applied
and administered in compliance with Rule 16b-3. If any provision of the Plan
would be in violation of Rule 16b-3 if applied as written, such provision shall
not have effect as written and shall be given effect so as to comply with Rule
16b-3, as determined by the Administrator. The Board is authorized to amend the
Plan and to make any such modifications to Award Agreements to comply with Rule
16b-3, as it may be amended from time to time, and to make any other such
amendments or modifications as it deems necessary or appropriate to better
accomplish the purposes of the Plan in light of any amendments made to Rule
16b-3.

     12.04 Securities Law Restrictions. The shares of Common Stock issuable
pursuant to the terms of any Awards granted under the Plan may not be issued by
the Company without registration or qualification of such shares under the
Securities Act of 1933, as amended, or under various state securities laws or
without an exemption from such registration requirements. Unless the shares to
be issued under the Plan have been registered and/or qualified as appropriate,
the Company shall be under no obligation to issue shares of Common Stock upon
exercise of an Award unless and until such time as there is an appropriate
exemption available from the registration or qualification requirements of
federal or state law as determined by the Administrator in its sole discretion.
The Administrator may require any person who is granted an award hereunder to
agree with the Company to represent and agree in writing that if such shares are
issuable under an exemption from registration requirements, the shares will be
"restricted" securities which may be resold only in compliance with applicable
securities laws, and that such person is acquiring the shares issued upon
exercise of the Award for investment, and not with the view toward distribution.

     12.05 Nonexclusivity of the Plan. Neither the adoption of the Plan by the
Board nor the submission of the Plan to the stockholders of the Company for
approval shall be construed as creating any limitations on the power of the
Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock or stock options otherwise
than under the Plan.

     12.06 Captions. The captions (i.e., all section headings) used in the Plan
are for convenience only, do not constitute a part of the Plan, and shall not be
deemed to limit, characterize or affect in any way any provisions of the Plan,
and all provisions of the Plan shall be construed as if no captions have been
used in the Plan.

     12.07 Severability. Whenever possible, each provision in the Plan and every
Award at any time granted under the Plan shall be interpreted in such a manner
as to be effective and valid under applicable law, but if any provision of the
Plan or any Award at any time granted under the Plan shall be held to be
prohibited or invalid under applicable law, then (a) such provision shall be
deemed amended to accomplish the objectives of the provision as originally
written to the fullest extent permitted by law and (b) all other provisions of
the Plan and every other Award at any time granted under the Plan shall remain
in full force and effect.

     12.08 No Strict Construction. No rule of strict construction shall be
implied against the Company, the Administrator, or any other person in the
interpretation of any of the terms of

                                      -14-
<PAGE>

the Plan, any Award granted under the Plan or any rule or procedure established
by the Administrator.

     12.09 Choice of Law. The Plan shall be governed by and construed in
accordance with the laws of the State of Michigan.

                                      -15-

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