Document:

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EXHIBIT (10)(ii)

                                SYNTELLECT, INC.

                        1990 EMPLOYEE STOCK PURCHASE PLAN

                     (AS AMENDED THROUGH FEBRUARY 28, 1998)

                  The following constitute the provisions of the 1990 Stock
Purchase Plan of Syntellect Inc.

         1. Purpose. The purpose of the Plan is to provide employees of the
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company through accumulated payroll deductions. It is the intention
of the Company to have the Plan qualify as an "Employee Stock Purchase Plan"
under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan shall, accordingly, be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

         2. Definitions.

                  a. "Board" shall mean the Board of Directors of the Company.

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

                  c. "Common Stock" shall mean the Common Stock of the Company.

                  d. "Company" shall mean Syntellect, Inc., a Delaware
         corporation.

                  e. "Compensation" shall mean all base straight time gross
         earnings including payments for overtime, shift premium, incentive
         compensation, incentive payments, bonuses, commissions or other
         compensation.

                  f. "Designated Subsidiaries" shall mean the Subsidiaries which
         have been designated by the Board from time to time in its sole
         discretion as eligible to participate in the Plan.

                  g. "Employee" shall mean any individual who is an employee of
         the Company for purposes of tax withholding under the Code whose
         customary employment with the Company or any Designated Subsidiary is
         at least twenty (20) hours per week and more than five (5) months in
         any calendar year. For purposes of the Plan, the employment
         relationship shall be treated as continuing intact while the individual
         is on sick leave or other leave of absence approved by the Company.
         Where the period of leave exceeds 90 days and the individual's right to
         reemployment is not guaranteed either by statute or by contract, the
         employment relationship will be deemed to have terminated on the 91st
         day of such leave.

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                  h. "Enrollment Date" shall mean the first day of each Offering
         Period.

                  i. "Exercise Date" shall mean the last day of each Offering
         Period.

                  j. "Offering Period" shall mean an initial period commencing
         on the date the Company's registration statement respecting its public
         offering is declared effective by the Securities and Exchange
         Commission and ending on December 31, 1990, and subsequent six month
         exercise periods thereafter commencing on July 1, 1990 during which
         options granted pursuant to the Plan may be exercised.

                  k. "Plan" shall mean this Employee Stock Purchase Plan.

                  l. "Subsidiary" shall mean a corporation, domestic or foreign,
         of which not less than 50 of the voting shares are held by the Company
         or a Subsidiary, whether or not such corporation now exists or is
         hereafter organized or acquired by the Company or a Subsidiary.

                  m. "Trading Day" shall mean a day on which national stock
         exchanges and the National Association of Securities Dealers Automated
         Quotation (NASDAQ) System are open for trading.

         3. Eligibility.

                  a. Any Employee as defined in paragraph 2 shall be employed by
         the Company on a given Enrollment Date shall be eligible to participate
         in the Plan.

                  b. Any provisions of the Plan to the contrary notwithstanding,
         no Employee shall be granted an option under the Plan (i) if,
         immediately after the grant, such Employee (or any other person whose
         stock would be attributed to such Employee pursuant to Section 425(d)
         of the Code) would own stock and/or hold outstanding options to
         purchase stock possessing five percent (5%) or more of the total
         combined voting power or value of all classes of stock of the Company
         or of any subsidiary of the Company, or (ii) which permits his rights
         to purchase stock under all employee stock purchase plans of the
         Company and its subsidiaries to accrue at a rate which exceeds
         Twenty-Five Thousand Dollars ($25,000) worth of stock (determined at
         the fair market value of the shares at the time such option is granted)
         for each calendar year in which such option is outstanding at any time.

         4. Offering Periods. The Plan shall be implemented by consecutive
Offering Periods after the initial Offering Period with a new Offering Period
commencing on the first Trading Day of July and January of each year, or on such
other date as the Board shall determine, and continuing thereafter until
terminated in accordance with paragraph 19 or 22 hereof. The Board shall have
the power to change the duration of Offering Periods with respect to future
offerings without shareholder approval if such change is announced at least
fifteen (15) days prior to the scheduled beginning of the first Offering Period
to be affected.

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         5. Participation.

                  a. An eligible Employee may become a participant in the Plan
         by completing a subscription agreement authorizing payroll deductions
         in the form of Exhibit A to this Plan and filing it with the Company's
         payroll office at such time as is specified by the Company and is prior
         to the applicable Enrollment Date (unless a later time for filing the
         subscription agreement is set by the Board for all eligible Employees
         with respect to a given Offering Period). Once properly made, an
         eligible Employee's election to participate shall be automatically
         renewed for each subsequent offering period, subject to any termination
         or withdrawal as provided in paragraph 10.

                  b. Payroll deductions for a participant shall commence on the
         first payroll following the Enrollment Date and shall end on the last
         payroll in the Offering Period to which such authorization is
         applicable, unless sooner terminated by the participant as provided in
         paragraph 10.

         6. Payroll Deductions.

                  a. At the time a participant files his subscription agreement,
         he shall elect to have payroll deductions made on each payday during
         the Offering Period in an amount not exceeding ten percent (10%) of the
         Compensation which he receives on each payday during the Offering
         Period, and the aggregate of such payroll deductions during the
         Offering Period shall not exceed ten percent (10%) of the participant's
         Compensation during said Offering Period.

                  b. All payroll deductions made for a participant shall be
         credited to his account under the Plan and will be withheld in whole
         percentages only. A participant may not make any additional payments
         into such account.

                  c. A participant may discontinue his participation in the Plan
         as provided in paragraph 10, or may decrease (but not increase) the
         rate of his payroll deductions during the offering period by completing
         or filing with the Company a new authorization for payroll deduction.
         The change in rate shall be effective fifteen (15) days following the
         Company's receipt of the new authorization.

                  d. Notwithstanding the foregoing, to the extent necessary to
         comply with Section 423(b)(8) of the Code and paragraph 3(b) herein, a
         participant's payroll deductions may be decreased to 0% at such time
         during any Offering Period which is scheduled to end during the current
         calendar year (the "Current Offering Period") that the aggregate of all
         payroll deductions which were previously used to purchase stock under
         the Plan in a prior Offering Period which ended during that calendar
         year plus all payroll deductions accumulated with respect to the
         Current Offering Period equal $21,250. Payroll deductions shall
         recommence at the rate provided in such participant's subscription
         agreement at the beginning of the first Offering Period which is
         scheduled to

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         end in the following calendar year, unless terminated by the
         participant as provided in paragraph 10.

                  e. At the time the option is exercised, in whole or in part,
         or at the time some or all of the Company's Common Stock issued under
         the Plan is disposed of, the participant must make adequate provision
         for the Company's federal, state, or other tax withholding obligations,
         if any, which arise upon the exercise of the option or the disposition
         of the Common Stock. At any time, the Company may, but will not be
         obligated to, withhold from the participant's Compensation the amount
         necessary for the Company to meet applicable withholding obligations,
         including any withholding required to make available to the Company any
         tax deductions or benefits attributable to sale or early disposition of
         Common Stock by the Employee.

         7. Grant of Option.

                  a. On the Enrollment Date of each Offering Period, each
         eligible Employee participating in such Offering Period shall be
         granted an option to purchase on the Exercise Date for such Offering
         Period (at the per share option price) up to a number of shares of the
         Company's Common Stock determined by dividing such Employee's payroll
         deductions accumulated prior to such Exercise Date and retained in the
         Participant's account as of the Exercise Date by the lower of (i)
         eighty-five percent (85%) of the fair market value of a share of the
         Company's Common Stock on the Enrollment Date or (ii) eighty-five
         percent (85%) of the fair market value of a share of the Company's
         Common Stock on the Exercise Date; provided that in no event shall an
         Employee be permitted to purchase during each Offering Period more than
         a number of shares determined by dividing $12,500 by the fair market
         value of a share of the Company's Common Stock on the Enrollment Date,
         and provided further that such purchase shall be subject to the
         limitations set forth in Sections 3(b) and 12 hereof. Exercise of the
         option shall occur as provided in Section 8, unless the participant has
         withdrawn pursuant to Section 10, and shall expire on the last day of
         the Offering Period. Fair market value of a share of the Company's
         Common Stock shall be determined as provided in Section 7(b) herein.

                  b. The option price per share of the shares offered in a given
         Offering Period shall be the lower of: (i) 85% of the fair market value
         of a share of the Common Stock of the Company on the Enrollment Date;
         or (ii) 85% of the fair market value of a share of the Common Stock of
         the Company on the Exercise Date. The fair market value of the
         Company's Common Stock shall be the closing bid price of the Common
         Stock for such date, as reported by the NASDAQ National Market System,
         or, in the event the Common Stock is listed on a stock exchange, the
         fair market value per share shall be the closing price on such exchange
         on such date, as reported in the Wall Street Journal. In the event the
         Enrollment Date or the Exercise Date occurs on a weekend or legal
         holiday, the fair market value shall be based on the closing bid price
         on the next trading day.

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         8. Exercise of Option. Unless a participant withdraws from the Plan as
provided in paragraph 10 below, his option for the purchase of shares will be
exercised automatically on the Exercise Date, and the maximum number of full
shares subject to option shall be purchased for such participant at the
applicable option price with the accumulated payroll deductions in his account.
No fractional shares will be purchased. During a participant's lifetime, a
participant's option to purchase shares hereunder is exercisable only by him or
her.

         9. Delivery. As promptly as practicable after the Exercise Date of each
Offering Period, the Company shall arrange the delivery to each participant, as
appropriate, a certificate representing the shares purchased upon exercise of
his option. Any cash remaining to the credit of a participant's account under
the Plan after a purchase by him of shares at the termination of each Offering
Period, or which is insufficient to purchase a full share of Common Stock of the
Company, shall be returned to said participant.

         10. Withdrawal; Termination of Employment.

                  a. A participant may withdraw all but not less than all the
         payroll deductions credited to his account and not yet used to exercise
         his option under the Plan at any time by giving written notice to the
         Company in the form of Exhibit B to this Plan. All of the participant's
         payroll deductions credited to his account will be paid to such
         participant promptly after receipt of notice of withdrawal and such
         participant's option for the Offering Period will be automatically
         terminated, and no further payroll deductions for the purchase of
         shares will be made during the Offering Period. If a participant
         withdraws from an Offering Period, payroll deductions will not resume
         at the beginning of the succeeding Offering Period unless the
         participant delivers to the Company a new subscription agreement.

                  b. Upon a participant's ceasing to be an Employee for any
         reason or upon termination of a participant's employment relationship
         (as described in Section 2(g)), the payroll deductions credited to such
         participant's account during the Offering Period but not yet used to
         exercise the option will be returned to such participant or, in the
         case of his death, to the person or persons entitled thereto under
         paragraph 14, and such participant's option will be automatically
         terminated.

                  c. In the event an Employee fails to remain an Employee of the
         Company for at least twenty (20) hours per week during an Offering
         Period in which the Employee is a participant, he will be deemed to
         have elected to withdraw from the Plan and the payroll deductions
         credited to his account will be returned to such participant and such
         participant's option terminated.

                  d. A participant's withdrawal from an Offering Period will not
         have any effect upon his eligibility to participate in any similar plan
         which may hereafter be adopted by the Company or in succeeding Offering
         Periods which commence after the termination of the Offering Period
         from which the participant withdraws.

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         11. Interest. No interest shall accrue on the payroll deductions of a
participant in the Plan.

         12. Stock.

                  a. The maximum number of shares of the Company's Common Stock
         which shall be made available for sale under the Plan shall be 800,000
         shares, subject to adjustment upon changes in capitalization of the
         Company as provided in paragraph 18. If on a given Exercise Date the
         number of shares with respect to which options are to be exercised
         exceeds the number of shares then available under the Plan, the Company
         shall make a pro rata allocation of the shares remaining available for
         purchase in as uniform a manner as shall be practicable and as it shall
         determine to be equitable.

                  b. The participant will have no interest or voting right in
         shares covered by his option until such option has been exercised.

                  c. Shares to be delivered to a participant under the Plan will
         be registered in the name of the participant or in the name of the
         participant and his spouse.

                  d. The Common Stock to be sold to participants under the Plan
         may, at the election of the Company, be either treasury stock or stock
         originally issued for such purpose.

         13. Administration. The Plan shall be administered by the Board of the
Company or a committee appointed by the Board; provided, however, the
administration of the Plan shall be consistent with Rule 16b-3 ("Rule 16b-3 ")
under the Securities Exchange Act of 1934. The administration, interpretation or
application of the Plan by the Board or a committee appointed by the Board shall
be final, conclusive and binding upon all participants.

         14. Designation of Beneficiary.

                  a. A participant may file a written designation of a
         beneficiary who is to receive any shares and cash, if any, from the
         participant's account under the Plan in the event of such participant's
         death subsequent to an Exercise Date on which the option is exercised
         but prior to delivery to such participant of such shares and cash. In
         addition, a participant may file a written designation of a beneficiary
         who is to receive any cash from the participant's account under the
         Plan in the event of such participant's death prior to exercise of the
         option.

                  b. Such designation of beneficiary may be changed by the
         participant at any time by written notice. In the event of the death of
         a participant and in the absence of a beneficiary validly designated
         under the Plan who is living at the time of such participant's death,
         the Company shall deliver such shares and/or cash to the executor or
         administrator of the estate of the participant, or if no such executor
         or administrator has been appointed (to the knowledge of the Company),
         the Company, in its discretion, may

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         deliver such shares and/or cash to the spouse or to any one or more
         dependents or relatives of the participant, or if no spouse, dependent
         or relative is known to the Company, then to such other person as the
         Company may designate.

         15. Transferability. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution, a "qualified domestic relations order" under the Code and the
Employee Retirement Income Security Act ("ERISA"), or as provided in paragraph
14 hereof) by the participant. Any such attempt at assignment, transfer, pledge
or other disposition shall be without effect, except that the Company may treat
such act as an election to withdraw funds from an Offering Period in accordance
with paragraph 10.

         16. Use of Funds. All payroll deductions received or held by the
Company under the Plan may be used by the Company for any corporate purpose, and
the Company shall not be obligated to segregate such payroll deductions.

         17. Reports. Individual accounts will be maintained for each
participant in the Plan. Statements of account will be given to participating
Employees at least annually, which statements will set forth the amounts of
payroll deductions, the per share purchase price, the number of shares purchased
and the remaining cash balance, if any.

         18. Adjustments Upon Changes in Capitalization. Subject to any required
action by the shareholders of the Company, the number of shares of Common Stock
covered by each option under the Plan which has not yet been exercised and the
number of shares of Common Stock which have been authorized for issuance under
the Plan but have not yet been placed under option (collectively, the
"Reserves"), as well as the price per share of Common Stock covered by each
option under the Plan which has not yet been exercised, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issue by the Company of shares of stock
of any class, or securities convertible into shares of stock of any class, shall
effect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an option.

         In the event of the proposed dissolution or liquidation of the Company,
the Offering Period will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board. In the event of a
proposed sale of all or substantially all of the assets of the Company, or the
merger of the Company with or into another corporation, each option under the
Plan shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Board determines, in the exercise of its sole discretion and in lieu
of such assumption or substitution, to

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shorten the Offering Period then in progress by setting a new Exercise Date (the
"New Exercise Date"). If the Board shortens the Offering Period then in progress
in lieu of assumption or substitution in the event of a merger or sale of
assets, the Board shall notify each participant in writing, at least (30) days
prior to the New Exercise Date, that the Exercise Date for his option has been
changed to the New Exercise Date and that his option will be exercised
automatically on the New Exercise Date, unless prior to such date he has
withdrawn from the Offering Period as provided in paragraph 10. For purposes of
this paragraph, an option granted under the Plan shall be deemed to be assumed
if, following the sale of assets or merger, the option confers the right to
purchase, for each share of option stock subject to the option immediately prior
to the sale of assets or merger, the consideration (whether stock, cash or other
securities or property) received in the sale of assets or merger by holders of
Common Stock for each share of Common Stock held on the effective date of the
transaction (and if such holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
shares of Common Stock); provided, however, that if such consideration received
in the sale of assets of merger was not solely common stock of the successor
corporation or its parent (as defined in Section 425(e) of the Code), the Board
may, with the consent of the successor corporation and the participant, provide
for the consideration to be received upon exercise of the option to be solely
common stock of the successor corporation or its parent equal in fair market
value to the per share consideration received by holders of Common Stock and the
sale of assets or merger.

         The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the price
per share of Common Stock covered by each outstanding option, in the event the
Company effects one or more reorganizations, recapitalizations, rights offerings
or other increases or reductions of shares of its outstanding Common Stock, and
in the event of the Company being consolidated with or merged into any other
corporation.

         19. Amendment or Termination.

                  a. The Board may at any time and for any reason terminate the
         Plan. The Board may also amend the Plan from time to time in such
         respects as the Board may deem advisable. Except as provided in
         paragraph 18, no such termination can affect options previously
         granted, provided that an Offering Period may be terminated by the
         Board of Directors on any Exercise Date if the Board determines that
         the termination of the Plan is in the best interests of the Company and
         its shareholders. Except as provided in paragraph 8, no amendment may
         make any change in any option theretofore granted which adversely
         affects the rights of any participant. To the extent required by
         applicable law, the Company shall obtain shareholder approval.

                  b. Without shareholder consent and without regard to whether
         any participant rights may be considered to have been "adversely
         affected," the Board (or its committee) shall be entitled to change the
         Offering Periods, limit the frequency and/or number of changes in the
         amount withheld during an Offering Period, establish the exchange ratio
         applicable to amounts withheld in a currency other than U.S. dollars,
         permit payroll withholding in excess of the amount designated by a
         participant in order to

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         adjust for delays or mistakes in the Company's processing of properly
         completed withholding elections, establish reasonable waiting and
         adjustment periods and/or accounting and crediting procedures to ensure
         that amounts applied toward the purchase of Common Stock for each
         participant properly correspond with amounts withheld from the
         participant's Compensation, and establish such other limitations or
         procedures as the Board (or its committee) determines in its sole
         discretion advisable which are consistent with the Plan.

                  c. Notwithstanding the foregoing, the Board or a committee
         appointed by the Board may not amend the Plan formula for determining
         the amount, price or timing of options to purchase shares of the
         Company's Common Stock granted under the Plan more than once every six
         months, other than to comport with changes in the Code and ERISA.

         20. Notices. All notices or other communications by a participant to
the Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the location,
or by the person, designated by the Company for the receipt thereof.

         21. Conditions Upon Issuance of Shares. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

         As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.

         22. Term of Plan. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
shareholders of the Company. It shall continue in effect for a term of twenty
(20) years unless sooner terminated under paragraph 19.

         23. Gender. For purposes of this Plan, words used in the masculine
gender shall include the female and neuter, and the singular shall include the
plural and vice versa, as appropriate.

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EXHIBIT (10)(iii)

                                 SYNTELLECT INC.
                            LONG-TERM INCENTIVE PLAN
                        (as amended through June 1, 2000)

                                ARTICLE 1 PURPOSE

                  1.1. GENERAL. The purpose of the Syntellect Inc. Long-Term
Incentive Plan (the "Plan") is to promote the success, and enhance the value, of
Syntellect Inc. (the "Company") by linking the personal interests of its
employees, consultants and advisors to those of Company shareholders and by
providing its employees, consultants and advisors with an incentive for
outstanding performance. The Plan is further intended to provide flexibility to
the Company in its ability to motivate, attract, and retain the services of
employees, consultants and advisors upon whose judgment, interest, and special
effort the successful conduct of the Company's operation is largely dependent.
Accordingly, the Plan permits the grant of incentive awards from time to time to
selected employees, consultants and advisors of the Company and any Subsidiary.

                            ARTICLE 2 EFFECTIVE DATE

                  2.1. EFFECTIVE DATE. The Plan became effective on February 1,
1995 (the "Effective Date), the date the Plan was approved by the Board. The
Plan was approved by the shareholders of the Company on May 23, 1995.

                     ARTICLE 3 DEFINITIONS AND CONSTRUCTION

                  3.1. DEFINITIONS. When a word or phrase appears in this Plan
with the initial letter capitalized, and the word or phrase does not commence a
sentence, the word or phrase shall generally be given the meaning ascribed to it
in this Section or in Sections 1.1 or 2.1 unless a clearly different meaning is
required by the context. The following words and phrases shall have the
following meanings:

                  (a) "Award" means any Option, Stock Appreciation Right,
         Restricted Stock Award, Performance Share Award, Dividend Equivalent
         Award, or Other Stock-Based Award, or any other right or interest
         relating to Stock or cash, granted to a Participant under the Plan.

                  (b) "Award Agreement" means any written agreement, contract,
         or other instrument or document evidencing an Award.

                  (c) "Board" means the Board of Directors of the Company or a
         Committee thereof formed under Section 4, as the case may be.

                  (d) "Cause" means (except as otherwise provided in an Option
         Agreement) if the Board, in its reasonable and good faith discretion,
         determines that the employee, consultant or advisor (i) has developed
         or pursued interests substantially adverse to the Company, (ii)
         materially breached any employment, engagement or confidentiality
         agreement or otherwise failed to satisfactorily discharge his or her
         duties, (iii) has not devoted all or substantially all of his or her
         business time, effort and attention to the affairs of the Company (or
         such lesser amount as has been agreed to in writing by the Company),
         (iv) is convicted of a felony involving moral turpitude, or (v) has
         engaged in activities or omissions that are detrimental to the
         well-being of the Company.

                  (e) "Change of Control" means and includes each of the
         following (except as otherwise provided in an Option Agreement):

                           (1) there shall be consummated any consolidation or
                  merger of the Company in which the Company is not the
                  continuing or surviving entity, or pursuant to which Stock
                  would be converted into cash, securities or other property,
                  other than a merger of the Company in which the holders of the
                  Company's Stock immediately prior to the merger have the same
                  proportionate

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                  ownership of beneficial interest of common stock or other
                  voting securities of the surviving entity immediately after
                  the merger;

                           (2) there shall be consummated any sale, lease,
                  exchange or other transfer (in one transaction or a series of
                  related transactions) of assets or earning power aggregating
                  more than 40% of the assets or earning power of the Company
                  and its subsidiaries (taken as a whole);

                           (3) the shareholders of the Company shall approve any
                  plan or proposal for liquidation or dissolution of the
                  Company;

                           (4) any person (as such term is used in Section 13(d)
                  and 14(d)(2) of the Exchange Act), other than any employee
                  benefit plan of the Company or any subsidiary of the Company
                  or any entity holding shares of capital stock of the Company
                  for or pursuant to the terms of any such employee benefit plan
                  in its role as an agent or trustee for such plan, shall become
                  the beneficial owner (within the meaning of Rule 13d-3 under
                  the Exchange Act) of 20% or more of the Company's outstanding
                  Stock; or

                           (5) during any period of two consecutive years,
                  individuals who at the beginning of such period shall fail to
                  constitute a majority thereof, unless the election, or the
                  nomination for election by the Company's shareholders, of each
                  new director was approved by a vote of at least two-thirds of
                  the directors then still in office who were directors at the
                  beginning of the period.

                  (f) "Code" means the Internal Revenue Code of 1986, as amended
         from time to time.

                  (g) "Committee" means the committee of the Board described in
         Article 4.

                  (h) "Disability" shall mean any illness or other physical or
         mental condition of a Participant which renders the Participant
         incapable of performing his customary and usual duties for the Company,
         or any medically determinable illness or other physical or mental
         condition resulting from a bodily injury, disease or mental disorder
         which in the judgment of the Committee is permanent and continuous in
         nature. The Committee may require such medical or other evidence as it
         deems necessary to judge the nature and permanency of the Participant's
         condition.

                  (i) "Dividend Equivalent" means a right granted to a
         Participant under Article 11.

                  (j) "Exchange Act" shall mean the Securities Exchange Act of
         1934, as amended from time to time.

                  (k) "Fair Market Value" means with respect to Stock or any
         other property, the fair market value of such Stock or other property
         as determined by the Board in its discretion, under one of the
         following methods: (i) the average of the closing bid and asked prices
         for the Stock as reported on any national securities exchange on which
         the Stock is then listed (which shall include the NASDAQ National
         Market System) for that date or, if no prices are so reported for that
         date, such prices on the next preceding date for which closing bid and
         asked prices were reported; or (ii) the price as determined by such
         methods or procedures as may be established from time to time by the
         Board.

                  (l) "Incentive Stock Option" means an Option that is intended
         to meet the requirements of Section 422 of the Code or any successor
         provision thereto.

                  (m) "Non-Qualified Stock Option" means an Option that is not
         intended to be an Incentive Stock Option.

                  (n) "Option" means a right granted to a Participant under
         Article 7 of the Plan to purchase Stock at a specified price during
         specified time periods.

         An Option may be either an Incentive Stock Option or a Non-Qualified
Stock Option.

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<PAGE>   3
                  (o) "Other Stock-Based Award" means a right, granted to a
         Participant under Article 12 that relates to or is valued by reference
         to Stock or other Awards relating to Stock.

                  (p) "Participant" means a person who, as an employee of or
         consultant or advisor to the Company or any Subsidiary, has been
         granted an Award under the Plan. A "Participant" shall not include any
         Director of the Company or any Subsidiary who is not also an employee
         of or consultant to the Company or any Subsidiary.

                  (q) "Performance Share" means a right granted to a Participant
         under Article 9, to receive cash, Stock, or other Awards, the payment
         of which is contingent upon achieving certain performance goals
         established by the Committee.

                  (r) "Plan" means the Syntellect Inc. Long-Term Incentive Plan,
         as amended from time to time.

                  (s) "Restricted Stock Award" means Stock granted to a
         Participant under Article 10 that is subject to certain restrictions
         and to risk of forfeiture.

                  (t) "Stock" means the common stock of the Company and such
         other securities of the Company that may be substituted for Stock
         pursuant to Article 13.

                  (u) "Stock Appreciation Right" or "SAR" means a right granted
         to a Participant under Article 8 to receive a payment equal to the
         difference between the Fair Market Value of a share of Stock as of the
         date of exercise of the SAR over the grant price of the SAR, all as
         determined pursuant to Article 8.

                  (v) "Subsidiary" means any corporation, domestic or foreign,
         of which a majority of the outstanding voting stock or voting power is
         beneficially owned directly or indirectly by the Company.

                            ARTICLE 4 ADMINISTRATION

                  4.1. BOARD/COMMITTEE. The Plan shall be administered by the
Board of Directors or, to the extent required to comply with Rule 16b-3
promulgated under the Exchange Act, a Committee that is appointed by, and serves
at the discretion of, the Board. Any Committee shall consist of at least two
individuals who are members of the Board and are "disinterested persons," as
such term is defined in Rule 16b-3 promulgated under Section 16 of the Exchange
Act or any successor provision, except as may be otherwise permitted under
Section 16 of the Exchange Act and the regulations and rules promulgated
thereunder. For purposes of this Plan, the "Board" shall mean the Board of
Directors or the Committee, as the case may be.

                  4.2. ACTION BY THE BOARD. A majority of the Board shall
constitute a quorum. The acts of a majority of the members present at any
meeting at which a quorum is present and acts approved in writing by a majority
of the Board in lieu of a meeting shall be deemed the acts of the Board. Each
member of the Board is entitled to, in good faith, rely or act upon any report
or other information furnished to that member by any officer or other employee
of the Company or any Subsidiary, the Company's independent certified public
accountants, or any executive compensation consultant or other professional
retained by the Company to assist in the administration of the Plan.

                  4.3. AUTHORITY OF BOARD. The Board has the exclusive power,
authority and discretion to:

                  (a) Designate Participants;

                  (b) Determine the type or types of Awards to be granted to
         each Participant;

                  (c) Determine the number of Awards to be granted and the
         number of shares of Stock to which an Award will relate;

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<PAGE>   4
                  (d) Determine the terms and conditions of any Award granted
         under the Plan including but not limited to, the exercise price, grant
         price, or purchase price, any restrictions or limitations on the Award,
         any schedule for lapse of forfeiture restrictions or restrictions on
         the exercisability of an Award, and accelerations or waivers thereof,
         based in each case on such considerations as the Board in its sole
         discretion determines;

                  (e) Determine whether, to what extent, and under what
         circumstances an Award may be settled in, or the exercise price of an
         Award may be paid in, cash, Stock, other Awards, or other property, or
         an Award may be canceled, forfeited, or surrendered;

                  (f) Prescribe the form of each Award Agreement, which need not
         be identical for each Participant;

                  (g) Decide all other matters that must be determined in
         connection with an Award;

                  (h) Establish, adopt or revise any rules and regulations as it
         may deem necessary or advisable to administer the Plan; and

                  (i) Make all other decisions and determinations that may be
         required under the Plan or as the Board deems necessary or advisable to
         administer the Plan.

                  4.4. DECISIONS BINDING. The Board's interpretation of the
Plan, any Awards granted under the Plan, any Award Agreement and all decisions
and determinations by the Board with respect to the Plan are final, binding, and
conclusive on all parties.

                      ARTICLE 5 SHARES SUBJECT TO THE PLAN

                  5.1. NUMBER OF SHARES. Subject to adjustment provided in
Section 15.1, the aggregate number of shares of Stock reserved and available for
Awards or which may be used to provide a basis of measurement for or to
determine the value of an Award (such as with a Stock Appreciation Right or
Performance Share Award) shall be 2,100,000.

                  5.2. LAPSED AWARDS. To the extent that an Award terminates,
expires or lapses for any reason, any shares of Stock subject to the Award will
again be available for the grant of an Award under the Plan and shares subject
to SARs or other Awards settled in cash will be available for the grant of an
Award under the Plan, in each case to the full extent available pursuant to the
rules and interpretations of the Securities and Exchange Commission under
Section 16 of the Exchange Act, if applicable.

                  5.3. STOCK DISTRIBUTED. Any Stock distributed pursuant to an
Award may consist, in whole or in part, of authorized and unissued Stock,
treasury Stock or Stock purchased on the open market.

                  5.4. LIMITATIONS ON AWARDS TO ANY SINGLE PARTICIPANT. There is
no limitation that restricts the number of shares of stock which are subject to
Awards issued to any single Participant.

                              ARTICLE 6 ELIGIBILITY

                  6.1. GENERAL. Awards may be granted only to individuals who
are employees (including employees who also are directors or officers) of the
Company or a Subsidiary or to consultants or advisors thereto, as determined by
the Board.

                             ARTICLE 7 STOCK OPTIONS

                  7.1. GENERAL. The Board is authorized to grant Options to
Participants on the following terms and conditions:

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<PAGE>   5
                  (a) EXERCISE PRICE. The exercise price per share of Stock
         under an Option shall be determined by the Board.

                  (b) TIME AND CONDITIONS OF EXERCISE. The Board shall determine
         the time or times at which an Option may be exercised in whole or in
         part. The Board also shall determine the performance or other
         conditions, if any, that must be satisfied before all or part of an
         Option may be exercised.

                  (c) PAYMENT. The Board shall determine the methods by which
         the exercise price of an Option may be paid, the form of payment,
         including, without limitation, cash, shares of Stock, or other property
         (including net issuance or other "cashless exercise" arrangements), and
         the methods by which shares of Stock shall be delivered or deemed to be
         delivered to Participants. Without limiting the power and discretion
         conferred on the Board pursuant to the preceding sentence, the Board
         may, in the exercise of its discretion, but need not, allow a
         Participant to pay the Option price by directing the Company to
         withhold from the shares of Stock that would otherwise be issued upon
         exercise of the Option that number of shares having a Fair Market Value
         on the exercise date equal to the Option price, all as determined
         pursuant to rules and procedures established by the Board.

                  (d) EVIDENCE OF GRANT. All Options shall be evidenced by a
         written Award Agreement between the Company and the Participant. The
         Award Agreement shall include such provisions as may be specified by
         the Board.

                  7.2. INCENTIVE STOCK OPTIONS. The terms of any Incentive Stock
Options granted under the Plan must comply with the following additional rules:

                  (a) EXERCISE PRICE. The exercise price per share of Stock
         shall be set by the Board, provided that the exercise price for any
         Incentive Stock Option may not be less than the Fair Market Value as of
         the date of the grant.

                  (b) EXERCISE. In no event, may any Incentive Stock Option be
         exercisable for more than ten years from the date of its grant.

                  (c) LAPSE OF OPTION. An Incentive Stock Option shall lapse
         under the following circumstances:

                           (1) The Incentive Stock Option shall lapse ten (10)
                  years after it is granted, unless an earlier time is set in
                  the Award Agreement.

                           (2) The Incentive Stock Option shall lapse upon
                  termination of employment for Cause or for any other reason,
                  other than the Participant's death or Disability, unless the
                  Committee determines in its discretion to extend the exercise
                  period for no more than ninety (90) days after the
                  Participant's termination of employment.

                           (3) In the case of the Participant's termination of
                  employment due to Disability or death, the Incentive Stock
                  Option shall lapse upon termination of employment, unless the
                  Committee determines in its discretion to extend the exercise
                  period of the Incentive Stock Option for no more than twelve
                  (12) months after the date the Participant terminates
                  employment. Upon the Participant's death, any vested and
                  otherwise exercisable Incentive Stock Options may be exercised
                  by the Participant's legal representative or representatives,
                  by the person or persons entitled to do so under the
                  Participant's last will and testament, or, if the Participant
                  shall fail to make testamentary disposition of such Incentive
                  Stock Option or shall die intestate, by the person or persons
                  entitled to receive said Incentive Stock Option under the
                  applicable laws of descent and distribution.

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<PAGE>   6
                  (d) INDIVIDUAL DOLLAR LIMITATION. The aggregate Fair Market
         Value (determined as of the time an Award is made) of all shares of
         Stock with respect to which Incentive Stock Options are first
         exercisable by a Participant in any calendar year may not exceed One
         Hundred Thousand Dollars ($100,000.00).

                  (e) TEN PERCENT OWNERS. An Incentive Stock Option shall be
         granted to any individual who, at the date of grant, owns stock
         possessing more than ten percent (10%) of the total combined voting
         power of all classes of Stock of the Company only if, at time such
         Option is granted, the Option price is at least one hundred ten percent
         (110%) of the Fair Market Value of the Stock and such Option by its
         terms is not exercisable after the expiration of five (5) years from
         the date the Option is granted.

                  (f) EXPIRATION OF INCENTIVE STOCK OPTIONS. No Award of an
         Incentive Stock Option may be made pursuant to this Plan after the
         tenth anniversary of the Effective Date.

                  (g) RIGHT TO EXERCISE. During a Participant's lifetime, an
         Incentive Stock Option may be exercised only by the Participant.

                  (h) EMPLOYEES ONLY. Incentive Stock Options may be granted
         only to Participants who are employees of the Company or any
         Subsidiary.

                       ARTICLE 8 STOCK APPRECIATION RIGHTS

                  8.1. GRANT OF SARs. The Board is authorized to grant SARs to
Participants on the following terms and conditions:

                  (a) RIGHT TO PAYMENT. Upon the exercise of a Stock
         Appreciation Right, the Participant to whom it is granted has the right
         to receive the excess, if any, of:

                           (1) The Fair Market Value of one share of Stock on
                  the date of exercise; over

                           (2) The grant price of the Stock Appreciation Right
                  as determined by the Board, which shall not be less than the
                  Fair Market Value of one share of Stock on the date of grant
                  in the case of any SAR related to any Incentive Stock Option.

                  (b) OTHER TERMS. All awards of Stock Appreciation Rights shall
         be evidenced by an Award Agreement. The terms, methods of exercise,
         methods of settlement, form of consideration payable in settlement, and
         any other terms and conditions of any Stock Appreciation Right shall be
         determined by the Board at the time of the grant of the Award and shall
         be reflected in the Award Agreement.

                          ARTICLE 9 PERFORMANCE SHARES

                  9.1. GRANT OF PERFORMANCE SHARES. The Board is authorized to
grant Performance Shares to Participants on such terms and conditions as may be
selected by the Board. The Board shall have the complete discretion to determine
the number of Performance Shares granted to each Participant. All Awards of
Performance Shares shall be evidenced by an Award Agreement.

                  9.2. RIGHT TO PAYMENT. A grant of Performance Shares gives the
Participant rights, valued as determined by the Board, and payable to, or
exercisable by, the Participant to whom the Performance Shares are granted, in
whole or in part, as the Board shall establish at grant or thereafter. The Board
shall set performance goals and other terms or conditions to payment of the
Performance Shares in its discretion which, depending on the extent to which
they are met, will determine the number and value of Performance Shares that
will be paid to the Participant, provided that the time period during which the
performance goals must be met shall, in all cases, exceed six months.

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<PAGE>   7
                  9.3. OTHER TERMS. Performance Shares may be payable in cash,
Stock, or other property, and have such other terms and conditions as determined
by the Board and reflected in the Award Agreement.

                       ARTICLE 10 RESTRICTED STOCK AWARDS

                  10.1. GRANT OF RESTRICTED STOCK. The Board is authorized to
make Awards of Restricted Stock to Participants in such amounts and subject to
such terms and conditions as may be selected by the Board. All Awards of
Restricted Stock shall be evidenced by a Restricted Stock Award Agreement.

                  10.2. ISSUANCE AND RESTRICTIONS. Restricted Stock shall be
subject to such restrictions on transferability and other restrictions as the
Board may impose (including, without limitation, limitations on the right to
vote Restricted Stock or the right to receive dividends on the Restricted
Stock). These restrictions may lapse separately or in combination at such times,
under such circumstances, in such installments, or otherwise, as the Board
determines at the time of the grant of the Award or thereafter.

                  10.3. FORFEITURE. Except as otherwise determined by the Board
at the time of the grant of the Award or thereafter, upon termination of
employment during the applicable restriction period, Restricted Stock that is at
that time subject to restrictions shall be forfeited and reacquired by the
Company, provided, however, that the Board may provide in any Award Agreement
that restrictions or forfeiture conditions relating to Restricted Stock will be
waived in whole or in part in the event of terminations resulting from specified
causes, and the Board may in other cases waive in whole or in part restrictions
or forfeiture conditions relating to Restricted Stock.

                  10.4. CERTIFICATES FOR RESTRICTED STOCK. Restricted Stock
granted under the Plan may be evidenced in such manner as the Board shall
determine. If certificates representing shares of Restricted Stock are
registered in the name of the Participant, certificates must bear an appropriate
legend referring to the terms, conditions, and restrictions applicable to such
Restricted Stock, and the Company shall retain physical possession of the
certificate until such time as all applicable restrictions lapse.

                         ARTICLE 11 DIVIDEND EQUIVALENTS

                  11.1. GRANT OF DIVIDEND EQUIVALENTS. The Board is authorized
to grant Dividend Equivalents to Participants subject to such terms and
conditions as may be selected by the Board. Dividend Equivalents shall entitle
the Participant to receive payments equal to dividends with respect to all or a
portion of the number of shares of Stock subject to an Option Award or SAR
Award, as determined by the Board. The Board may provide that Dividend
Equivalents be paid or distributed when accrued or be deemed to have been
reinvested in additional shares of Stock, or otherwise reinvested.

                       ARTICLE 12 OTHER STOCK-BASED AWARDS

                  12.1. GRANT OF OTHER STOCK-BASED AWARDS. The Board is
authorized, subject to limitations under applicable law, to grant to
Participants such other Awards that are payable in, valued in whole or in part
by reference to, or otherwise based on or related to shares of Stock, as deemed
by the Board to be consistent with the purposes of the Plan, including without
limitation shares of Stock awarded purely as a "bonus" and not subject to any
restrictions or conditions, convertible or exchangeable debt securities, other
rights convertible or exchangeable into shares of Stock, and Awards valued by
reference to book value of shares of Stock or the value of securities of or the
performance of specified Subsidiaries. The Board shall determine the terms and
conditions of such Awards.

                   ARTICLE 13 PROVISIONS APPLICABLE TO AWARDS

                  13.1. STAND-ALONE, TANDEM, AND SUBSTITUTE AWARDS. Awards
granted under the Plan may, in the discretion of the Board, be granted either
alone or in addition to, in tandem with, or in substitution for, any other Award
granted under the Plan. If an Award is granted in substitution for another
Award, the Board may require the surrender of such other Award in consideration
of the grant of the new Award. Awards granted in addition to or in tandem with
other Awards may be granted either at the same time as or at a different time
from the grant of such other Awards.

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<PAGE>   8
                  13.2. EXCHANGE PROVISIONS. The Board may at any time offer to
exchange or buy out any previously granted Award for a payment in cash, Stock,
or another Award (subject to Section 13.1), based on the terms and conditions
the Board determines and communicates to the Participant at the time the offer
is made.

                  13.3. TERM OF AWARD. The term of each Award shall be for the
period as determined by the Board, provided that in no event shall the term of
any Incentive Stock Option or a Stock Appreciation Right granted in tandem with
the Incentive Stock Option exceed a period of ten years from the date of its
grant.

                  13.4. FORM OF PAYMENT FOR AWARDS. Subject to the terms of the
Plan and any applicable law or Award Agreement, payments or transfers to be made
by the Company or a Subsidiary on the grant or exercise of an Award may be made
in such forms as the Board determines at or after the time of grant, including
without limitation, cash, Stock, other Awards, or other property, or any
combination, and may be made in a single payment or transfer, in installments,
or on a deferred basis, in each case determined in accordance with rules adopted
by, and at the discretion of, the Board. The Board may also authorize payment in
the exercise of an Option by net issuance or other cashless exercise methods.

                  13.5. LIMITS ON TRANSFER. No right or interest of a
Participant in any Award may be pledged, encumbered, or hypothecated to or in
favor of any party other than the Company or a Subsidiary, or shall be subject
to any lien, obligation, or liability of such Participant to any other party
other than the Company or a Subsidiary. Except as otherwise provided below, no
Award shall be assignable or transferable by a Participant other than by will or
the laws of descent and distribution or, with the consent of the Board in its
sole discretion and except in the case of an Incentive Stock Option, pursuant to
a court order that would otherwise satisfy the requirements to be a domestic
relations order as defined in Section 414(p)(1)(B) of the Code, if the order
satisfies Section 414(p)(1)(A) of the Code notwithstanding that such an order
relates to the transfer of a stock option rather than an interest in an employee
benefit plan. In the Award Agreement for any Award other than an Award that
includes an Incentive Stock Option, the Board may allow a Participant to assign
or otherwise transfer all or a portion of the rights represented by the Award to
specified individuals or classes of individuals, or to a trust benefiting such
individuals or classes of individuals, subject to such restrictions,
limitations, or conditions as the Board deems to be appropriate.

                  13.6. BENEFICIARIES. Notwithstanding Section 13.5, a
Participant may, in the manner determined by the Board, designate a beneficiary
to exercise the rights of the Participant and to receive any distribution with
respect to any Award upon the Participant's death. A beneficiary, legal
guardian, legal representative, or other person claiming any rights under the
Plan is subject to all terms and conditions of the Plan and any Award Agreement
applicable to the Participant, except to the extent the Plan and Award Agreement
otherwise provide, and to any additional restrictions deemed necessary or
appropriate by the Board. If the Participant is married and resides in a
jurisdiction in which community property laws apply, a designation of a person
other than the Participant's spouse as his beneficiary with respect to more than
50 percent of the Participant's interest in the Award shall not be effective
without the written consent of the Participant's spouse. If no beneficiary has
been designated or survives the Participant, payment shall be made to the person
entitled thereto under the Participant's will or the laws of descent and
distribution. Subject to the foregoing, a beneficiary designation may be changed
or revoked by a Participant at any time provided the change or revocation is
filed with the Board.

                  13.7. STOCK CERTIFICATES. All Stock certificates delivered
under the Plan are subject to any stop-transfer orders and, other restrictions
as the Board deems necessary or advisable to comply with federal or state
securities laws, rules and regulations and the rules of any national securities
exchange or automated quotation system on which the Stock is listed, quoted, or
traded. The Board may place legends on any Stock certificate to reference
restrictions applicable to the Stock.

                  13.8 TENDER OFFERS. In the event of a public tender for all or
any portion of the Stock, or in the event that a proposal to merge, consolidate,
or otherwise combine with another company is submitted for shareholder approval,
the Board may in its sole discretion declare previously granted Options to be
immediately exercisable. To the extent that this provision causes Incentive
Stock Options to exceed the dollar limitation set forth in Section 7.2(d), the
excess Options shall be deemed to be Non-Qualified Stock Options.

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<PAGE>   9
                  13.9. CHANGE OF CONTROL. A Change of Control shall cause every
Option outstanding hereunder to become fully exercisable and allow each
Participant the right to exercise an Option prior to the occurrence of the event
otherwise terminating the Option; provided, however, that in the event (i) the
Company's Board of Directors approves a transaction to be accounted for as a
"pooling-of-interests" and (ii) the Company's independent accountants have
advised the Company in writing that the amendment to this Section 13.9 approved
by the Board of Directors on February 17, 1998, precludes such accounting, then,
without any further action, such amendment to Section 13.9 shall be null and
void, and Section 13.9 shall remain in effect as existing prior to such
amendment.

                     ARTICLE 14 CHANGES IN CAPITAL STRUCTURE

                  14.1. GENERAL. In the event a stock dividend is declared upon
the Stock, the shares of Stock then subject to each Award (and the number of
shares subject thereto) shall be increased proportionately without any change in
the aggregate purchase price therefor. In the event the Stock shall be changed
into or exchanged for a different number or class of shares of Stock or of
another corporation, whether through reorganization, recapitalization, stock
split-up, combination of shares, there shall be substituted for each such share
of Stock then subject to each Award (and for each share of Stock then subject
thereto) the number and class of shares of Stock into which each outstanding
share of Stock shall be so exchanged, all without any change in the aggregate
purchase price for the shares then subject to each Award.

               ARTICLE 15 AMENDMENT, MODIFICATION AND TERMINATION

                  15.1. AMENDMENT, MODIFICATION AND TERMINATION. With the
approval of the Board, at any time and from time to time, the Board may
terminate, amend or modify the Plan. However, without approval of the
shareholders of the Company or other conditions (as may be required by the Code,
by the insider trading rules of Section 16 of the Exchange Act, by any national
securities exchange or system on which the Stock is listed or reported, or by a
regulatory body having jurisdiction), no such termination, amendment, or
modification may:

                  (a) Materially increase the total number of shares of Stock
         that may be issued under the Plan, except as provided in Section 14.1;

                  (b) Materially modify the eligibility requirements for
         participation in the Plan; or

                  (c) Materially increase the benefits accruing to Participants
         under the Plan.

                  15.2. AWARDS PREVIOUSLY GRANTED. No termination, amendment, or
modification of the Plan shall adversely affect in any material way any Award
previously granted under the Plan, without the written consent of the
Participant.

                          ARTICLE 16 GENERAL PROVISIONS

                  16.1. NO RIGHTS TO AWARDS. No Participant or employee or
consultant shall have any claim to be granted any Award under the Plan, and
neither the Company nor the Board is obligated to treat Participants and
employees or consultants uniformly.

                  16.2. NO STOCKHOLDERS RIGHTS. No Award gives the Participant
any of the rights of a stockholder of the Company unless and until shares of
Stock are in fact issued to such person in connection with such Award.

                  16.3. WITHHOLDING. The Company or any Subsidiary shall have
the authority and the right to deduct or withhold, or require a Participant to
remit to the Company, an amount sufficient to satisfy United States Federal,
state, and local taxes (including the Participant's FICA obligation and any
withholding obligation imposed by any country other than the United States in
which the Participant resides) required by law to be withheld with respect to
any taxable event arising as a result of this Plan. With respect to withholding
required upon any taxable event under the Plan, Participants may elect, subject
to the Board's approval, to satisfy the withholding requirement,

                                       83
<PAGE>   10
in whole or in part, by having the Company or any Subsidiary withhold shares of
Stock having a Fair Market Value on the date of withholding equal to the amount
to be withheld for tax purposes in accordance with such procedures as the Board
establishes. The Board may, at the time any Award is granted, require that any
and all applicable tax withholding requirements be satisfied by the withholding
of shares of Stock as set forth above.

                  16.4. NO RIGHT TO EMPLOYMENT. Nothing in the Plan or any Award
Agreement shall interfere with or limit in any way the right of the Company or
any Subsidiary to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continue in the employ of the Company or any
Subsidiary.

                  16.5. UNFUNDED STATUS OF AWARDS. The Plan is intended to be an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments not yet made to a Participant pursuant to an Award, nothing contained
in the Plan or any Award Agreement shall give the Participant any rights that
are greater than those of a general creditor of the Company or any Subsidiary.

                  16.6. INDEMNIFICATION. To the extent allowable under
applicable law, each member of the Committee or of the Board shall be
indemnified and held harmless by the Company from any loss, cost, liability, or
expense that may be imposed upon or reasonably incurred by such member in
connection with or resulting from any claim, action, suit, or proceeding to
which he or she may be a party or in which he or she may be involved by reason
of any action or failure to act under the Plan and against and from any and all
amounts paid by him or her in satisfaction of judgment in such action, suit, or
proceeding against him or her provided he or she gives the Company an
opportunity, at its own expense, to handle and defend the same before he or she
undertakes to handle and defend it on his or her own behalf. The foregoing right
of indemnification shall not be exclusive of any other rights of indemnification
to which such persons may be entitled under the Company's Articles of
Incorporation or By-Laws, as a matter of law, or otherwise, or any power that
the Company may have to indemnify them or hold them harmless.

                  16.7. RELATIONSHIP TO OTHER BENEFITS. No payment under the
Plan shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or other benefit
plan of the Company or any Subsidiary.

                  16.8. EXPENSES. The expenses of administering the Plan shall
be borne by the Company and its Subsidiaries.

                  16.9. TITLES AND HEADINGS. The titles and headings of the
Sections in the Plan are for convenience of reference only, and in the event of
any conflict, the text of the Plan, rather than such titles or headings, shall
control.

                  16.10. FRACTIONAL SHARES. No fractional shares of stock shall
be issued and the Board shall determine, in its discretion, whether cash shall
be given in lieu of fractional shares or whether such fractional shares shall be
eliminated by rounding up.

                  16.11. SECURITIES LAW COMPLIANCE. With respect to any person
who is, on the relevant date, obligated to file reports under Section 16 of the
Exchange Act, transactions under this Plan are intended to comply with all
applicable conditions of Rule 16b-3 or its successors under the Exchange Act. To
the extent any provision of the Plan or action by the Board fails to so comply,
it shall be void to the extent permitted by law and voidable as deemed advisable
by the Board, and such provision or action shall be deemed to be modified so as
to comply with Rule 16b-3.

                  16.12. GOVERNMENT AND OTHER REGULATIONS. The obligation of the
Company to make payment of awards in Stock or otherwise shall be subject to all
applicable laws, rules, and regulations, and to such approvals by government
agencies as may be required. The Company shall be under no obligation to
register under the Securities Act of 1933, as amended, any of the shares of
Stock paid under the Plan. If the shares paid under the Plan may in certain
circumstances be exempt from registration under such act, the Company may
restrict the transfer of such shares in such manner as it deems advisable to
ensure the availability of any such exemption.

                                       84
<PAGE>   11
                  16.13. GOVERNING LAW. The Plan and all Award Agreements shall
be construed in accordance with and governed by the laws of the State of
Arizona.

                                       85

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