Document:

ex_10-1.htm

     

    

    EXCALIBUR
TECHNOLOGIES CORPORATION

    

    1995 INCENTIVE
PLAN

    

    Section
1.  Purpose: Definitions

     

    

    The purpose of the Excalibur
Technologies Corporation 1995 Incentive Plan (the “Plan”) is to enable Excalibur
Technologies Corporation (the “Company”) to attract, retain and reward key
employees of the Company and its Subsidiaries and Affiliates, and strengthen the
mutuality of interest between such key employees and the Company’s stockholders
by offering such key employees performance-based stock incentives and/or other
equity interests or equity-based incentives in the Company, as well as
performance-based incentives payable in cash.

    

    For purposes of the Plan the following
terms shall be defined as set forth below:

    

    (a)           “Affiliate”
means any entity other than the Company and its Subsidiaries that is designated
by the Board as a participating employer under the Plan, provided that the
Company directly or indirectly owns at least 20% of the combined voting power of
all classes of stock of such entity or at least 20% of the ownership interests
in such entity.

    

    (b)           “Board”
means the Board of Directors of the Company.

    

    (c)           “Book
Value” means as of any given date, on a per share basis (i) the stockholders’
Equity in the Company as of the end of the immediately preceding fiscal year as
reflected in the Company’s consolidated balance sheet, subject to such
adjustments as the Committee shall specify at or after grant, divided by (ii)
the number of then outstanding shares of Stock as of such year-end date (as
adjusted by the Committee for subsequent events).

    

    (d)           “Code”
means the Internal Revenue Code of 1986, as amended from time to time, and any
successor thereto.

    

    (e)           “Committee”
means the Committee referred to in Section 2 of the Plan.  If at any
time no Committee shall be in office, then the functions of the Committee
specified in the Plan shall be exercised by the Board.

    

    (f)           “Company”
means Excalibur Technologies Corporation, a corporation organized under the laws
of the State of Delaware, or any successor corporation.

    

    (g)           “Disability”
means disability as determined under procedures established by the Committee for
purposes of this Plan.

    

    (h)           “Disinterested
Person” shall have the meaning set forth in Rule 16b-3(d)(3) as promulgated by
the Securities and Exchange Commission under the Securities Exchange Act of 1934
(the “Exchange Act”), or any successor definition adopted by the
Commission.

    

    (i)           “Fair
Market Value” means as of any given date, unless otherwise determined by the
Committee in good faith, the mean between the highest and lowest quoted bid
price, regular way, of the Stock on the NASDAQ System or, if no such sale of
Stock occurs on such date, the fair market value of the Stock as determined by
the Committee in good faith.

    

    (j)           “Incentive
Stock Option” means any Stock Option intended to be and designated as an
“Incentive Stock Option” within the meaning of Section 422A of the
Code.

    

    (k)           “Non-Qualified
Stock Option” means any Stock Option that is not an Incentive Stock
Option.

    

    (l)           “Other
Stock-Based Award” means an award under Section 6 below that is valued in whole
or in part by reference to, or is otherwise based on, Stock.

     

    
      (m)           “Stock”
means the Common Stock, $.01 par value per share of the
Company.

    

    

    (n)           “Stock
Option” or “Option” means any option to purchase shares of Stock (including
Restricted Stock and Deferred Stock, if the Committee so determines) granted
pursuant to Section 5 below.

    

    (o)           “Subsidiary”
means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if the corporation (other than the last
corporation in the unbroken chain) owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in the chain.

    

    In addition, the terms “Change in
Control” and “Change in Control Price” shall have the meanings set forth,
respectively, in Sections 11(b), (c) and (d) below and the term “Cause” shall
have the meaning set forth in Section 5(i) below.

    

    

    

    SECTION
2.  Administration

    

    The Plan shall be administered by a
Committee of no fewer than two Disinterested Persons, who shall be appointed by
the Board and who shall serve at the pleasure of the Board.  The
functions of the Committee specified in the Plan shall be exercised by the
Board, if and to the extent that no Committee exists which has the authority to
so administer the Plan.

    

    The Committee shall have full authority
to grant, pursuant to the terms of the Plan, to officers and other key employees
eligible under Section 4:  (i) Stock Options, and/or (ii) Other
Stock-Based Awards.

    

    In particular, the Committee shall have
the authority:

    

    (a)           to
select the officers and other key employees of the Company and its Subsidiaries
and Affiliates to whom Stock Options and/or Other Stock-Based Awards may from
time to time be granted hereunder;

    

    (b)           to
determine whether and to what extent Incentive Stock Options, Non-Qualified
Stock Options, and/or Other Stock-Based Awards, or any combination thereof, are
to be granted hereunder to one or more eligible employees;

    

    (c)           to
determine the number of shares to be covered by each such award granted
hereunder;

    

    (d)           to
determine the terms and conditions, not inconsistent with the terms of the Plan,
of any award granted hereunder (including, but not limited to, the share price
and any restriction or limitation, or any vesting acceleration or waiver of
forfeiture restrictions regarding any Stock Option or other award and/or the
shares of Stock relating thereto, based in each case on such factors as the
Committee shall determine, in its sole discretion);

    

    (e)           to
determine whether and under what circumstances a Stock Option may be settled in
cash, Restricted Stock and/or Deferred Stock under Section 5(k) or (l), as
applicable, instead of Stock;

    

    (f)           to
determine whether, to what extent and under what circumstances grants and/or
other awards under the Plan and/or other cash awards made by the Company are to
be made, and  operate, on a tandem basis vis-à-vis other awards under
the Plan and/or cash awards made outside of the Plan, or on an additive
basis;

    

    (g)           to
determine whether, to what extent and under what circumstances Stock and other
amounts payable with respect to an award under this Plan shall be deferred
either automatically or at the election of the participant (including providing
for and determining the amount (if any) of any deemed earnings on any deferred
amount during any deferral period);

    

    (h)           to
determine the terms and restrictions applicable to Stock Purchase Rights and the
Stock purchased by exercising such Rights; and

    

    (i)           to
grant with the consent of the optionee, in substitution for outstanding Stock
Options, replacement Stock Options, which may be at a lower exercise price,
provided that, in the case of Incentive Stock Options, at an exercise price less
than the Fair Market Value of the Stock at the time of replacement.

    

    The Committee shall have the authority
to adopt, alter and repeal such rules, guidelines and practices governing the
Plan as it shall, from time to time, deem advisable; to interpret the terms and
provisions of the Plan and any award issued under the Plan (and any agreements
relating thereto); and to otherwise supervise the administration of the
Plan.

    

    All decisions made by the Committee
pursuant to the provisions of the Plan shall be made in the Committee’s sole
discretion and shall be final and binding on all persons, including the Company
and Plan participants.

    

    

    

    

    SECTION 3.  Stock
Subject to Plan

    

    The total number of shares of Stock
reserved and available for distribution under the Plan shall be 400,000
shares.  Such shares may consist, in whole or in part, of authorized
and unissued shares or treasury shares.

    

    Subject to Section 6(b)(iv) below, if
any shares of Stock that have been optioned cease to be subject to a Stock
Option, or if any such shares of Stock that are subject to any Restricted Stock
or Deferred Stock award, Stock Purchase Right or other Stock-Based Award granted
hereunder are forfeited or any such award otherwise terminates, without a
payment being made to the participant in the form of Stock, such shares shall
again be available for distribution in connection with future awards under the
Plan.

    

    In the event of any merger,
reorganization, consolidation, recapitalization, stock dividend, stock split
spin-offs, spin-outs or other change in corporate structure affecting the Stock,
such substitution or adjustment shall be made in the aggregate number of shares
reserved for issuance under the Plan, in the number and option price of shares
subject to outstanding Options granted under the Plan, in the number and
purchase price of shares subject to outstanding Stock Purchase Rights under the
Plan, and in the number of shares subject to other outstanding awards granted
under the Plan as may be determined to be appropriate by the Committee, in its
sole discretion, provided that the number of shares subject to any award shall
always be a whole number.  Such adjusted option price shall also be
used to determine the amount payable by the Company upon the exercise of any
Stock Appreciation Right associated with any Stock Option.

    

    

    

    SECTION
4.  Eligibility

    

    Officers, directors and key employees
of the Company and its Subsidiaries and Affiliates (but excluding members of the
Committee) and any other individual as determined by the Committee who are
responsible for or contribute to the management, growth and/or profitability of
the business of the Company and/or its Subsidiaries and Affiliates are eligible
to be granted awards under the Plan.

    

    

    

    SECTION 5  Stock
Options

    

    Stock Options may be granted alone, in
addition to or in tandem with other awards granted under the Plan and/or cash
awards made outside of the Plan.  Any Stock Option granted under the
Plan shall be in such form as the Committee may from time to time
approve.

    

    Stock Options granted under the Plan
may be of two types:  (i) Incentive Stock Options and (ii)
Non-Qualified Stock Options.

    

    The Committee shall have the authority
to grant to any optionee Incentive Stock Options, Non-Qualified Stock Options,
or both types of Stock Options (in each case with or without Stock Appreciation
Rights).

    

    Options granted under the Plan shall be
subject to the following terms and conditions and shall contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the
Committee shall deem desirable:

    

    (a)           Option
Price.  The option price per share of Stock purchasable under
an Incentive Stock Option shall be determined by the Committee at the time of
grant but shall be not less than 100% of the Fair Market Value of the Stock at
the time of grant.  Non-Qualified Stock Options may, in the discretion
of the Committee, may be granted at a price per share less than the Fair Market
Value of the Stock at the time of grant.

    

    (b)           Option
Term.  The term of each Stock Option shall be fixed by the
Committee, but no Stock Option shall be exercisable more than ten years after
the date the Option is granted.

    

    (c)           Exercisability.  Stock
Options shall be exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Committee at or after
grant.  If the Committee provides, in its sole discretion, that any
Stock Option is exercisable only in installments, the Committee may waive such
installment exercise provisions at any time at or after grant in whole or in
part, based on such factors as the Committee shall determine, in its sole
discretion.

    

    (d)           Method of
Exercise.  Subject to whatever installment exercise provisions
apply under Section 5(c), Stock Options may be exercised in whole or in part at
any time during the option period by giving written notice of exercise to the
Company specifying the number of shares to be purchased.  Such notice
shall be accompanied by payment in full of the purchase price, either by check,
note or such other instrument as the Committee may accept.  As
determined by the Committee, in its sole discretion, at of after grant, payment
in full or in part may also be made in the form of Stock or, in the case of the
exercise of a Non-Qualified Stock Option, Restricted Stock or Deferred Stock
subject to an award hereunder (based, in each case, on the Fair Market Value of
the Stock on the date the option is exercised, as determined by the
Committee).

    

    No shares of Stock shall be issued
until full payment therefor has been made.  An optionee shall
generally have the rights to dividends or other rights of a shareholder with
respect to shares subject to the Option when the optionee has given written
notice of exercise, has paid in full for such shares, and if requested, has
given the representation described in Section 10(a).

    

    (e)           Non-Transferability of
Options.  No Stock Option shall be transferable by the optionee
otherwise than by will or by the laws of descent and distribution, and all Stock
Options shall be exercisable, during the optionee’s lifetime, only by the
optionee.

    

    (f)           Termination by
Death.  Subject to Section 5(j), if an optionee’s employment by
the Company or any Subsidiary or Affiliate terminates by reason of death, any
Stock Option held by such optionee may thereafter be exercised, to the extent
such option was exercisable at the time of death or on such accelerated basis as
the Committee may determine at or after grant (or as may be determined in
accordance with procedures established by the Committee), by the legal
representative of the estate or by the legatee of the optionee under the will of
the optionee, for a period of one year (or such other period as the Committee
may specify at grant) from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter.

    

    (g)           Termination by Reason of
Disability.  Subject to Section 5(j), if an optionee’s
employment by the Company and any Subsidiary or Affiliate terminates by reason
of Disability, any Stock Option held by such optionee may thereafter be
exercised by the optionee, to the extent it was exercisable at the time of
termination or on such accelerated basis as the Committee may determine at or
after grant (or as may be determined in accordance with procedures established
by the Committee), for a period of one year (or such other period as the
Committee may specify at grant) from the date of such termination of employment
or until the expiration of the stated term of such Stock Option, whichever
period is the shorter, provided, however, that if the optionee dies within such
one-year period (or such other period as the Committee shall specify at grant),
any unexercised Stock Option held by such optionee shall thereafter be
exercisable to the extent to which it was exercisable at the time of death for a
period of one year from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter.  In
the event of termination of employment by reason of Disability, if an Incentive
Stock Option is exercised after the expiration of the exercise periods that
apply for purposes of Section 422A of the Code, such Stock Option will
thereafter be treated as a Non-Qualified Stock Option.

    

    (h)           Other
Termination.  Unless otherwise determined by the Committee (or
pursuant to procedures established by the Committee) at or after grant, if the
employment of an optionee by the Company or any Subsidiary or Affiliate
terminates for any reason other than death or Disability, the Stock Option shall
thereupon terminate, except that such Stock Option may be exercised, to the
extent otherwise then exercisable, for the lesser of three months or the balance
of such Stock Option’s term if the optionee is involuntarily terminated by the
Company or any Subsidiary or Affiliate without Cause.  For purposes of
this Plan, “Cause” means a felony conviction of an optionee or the failure of an
optionee to contest prosecution for a felony, or an optionee’s willful
misconduct or dishonesty, any of which is directly and materially harmful to the
business or reputation of the Company or any Subsidiary or
Affiliate.

    

    (i)           Incentive Stock
Options.  Anything in the Plan to the contrary notwithstanding,
no term of this Plan relating to Incentive Stock Options shall be interpreted,
amended or altered, nor shall any discretion or authority granted under this
Plan be so exercised, so as to disqualify the Plan under Section 422A of the
Code, or without consent of the optionee(s) affected, to disqualify any
Incentive Stock Option under such Section 422A.

    

    To the extent required for “incentive
stock option” status under Section 422A(b)(7) of the Code (taking into account
applicable Internal Revenue Service regulations and pronouncements), the Plan
shall be deemed to provide that the aggregate Fair Market Value (determined as
of the time of grant) of the Stock with respect to which Incentive Stock Options
granted are exercisable for the first time by the optionee during any calendar
year under the Plan and/or any other stock option plan of the Company or any
Subsidiary or parent corporation (within the meaning of Section 425 of the Code)
shall not exceed $100,000.  If Section 422A is hereafter amended to
delete the requirement now in Section 422A(b)(7) that the plan text expressly
provide for the $100,000 limitation set forth in Section 422A(b)(7), then this
first paragraph of Section 5(i) shall no longer be operative.

    

    (j)           Buyout
Provisions.  The Committee may at any time offer to buy out for
a payment in cash Stock, Deferred Stock or Restricted Stock an option previously
granted, based on such terms and conditions as the Committee shall establish and
communicate to the optionee at the time that such offer is made.

    

    (k)           Settlement
Provisions.  If the option agreement so provides at grant or is
amended after grant and prior to exercise to so provide (with the optionee’s
consent), the Committee may require that all or part of the shares to be issued
with respect to the spread value of an exercised Option take the form of
Deferred or Restricted Stock, which shall be valued on the date of exercise on
the basis of the Fair Market Value (as determined by the Committee) of such
Deferred or Restricted Stock determined without regard to the deferral
limitations and/or forfeiture restrictions involved.

    

    

    

    SECTION 6.  Other
Stock-Based Awards

    

    (a)           Administration.  Other
awards of Stock and other awards that are valued in whole or in part by
reference to, or are otherwise based on, Stock (“Other Stock-Based Awards”),
including, without limitation, performance shares, convertible preferred stock,
convertible debentures, exchangeable securities and Stock awards or options
valued by reference to Book Value or subsidiary performance, may be granted
either alone or in addition to or in tandem with Stock Options granted under the
Plan and/or cash awards made outside of the Plan.

    

    Subject to the provision of the Plan,
the Committee shall have authority to determine the persons to whom and the time
or times at which such awards shall be made, the number of shares of Stock to be
awarded pursuant to such awards, and all other conditions of the
awards.  The Committee may also provide for the grant of Stock upon
the completion of a specified performance period.

    

    The provisions of Other Stock-Based
Awards need not be the same with respect to each recipient.

    

    (b)           Terms and
Conditions.  Other Stock-Based Awards made pursuant to this
Section 6 shall be subject to the following terms and conditions:

    

    (i)           Subject
to the provision of the Plan and the award agreement referred to in Section
6(b)(v) below, shares subject to awards made under this Section 6 may not be
sold, assigned, transferred, pledged 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.

    

    (ii)           Subject
to the provisions of the Plan and the award agreement and unless otherwise
determined by the Committee at grant, the recipient of an award under this
Section 6 shall be entitled to receive, currently or on a deferred basis,
interest or dividends or interest or dividend equivalents with respect to the
number of shares covered by the award, as determined at the time of the award by
the Committee, in its sole discretion, and the Committee may provide that such
amounts (if any) shall be deemed to have been reinvested in additional Stock or
otherwise reinvested.

    

    (iii)           Any
award under this Section 6 and any Stock covered by any such award shall vest or
be forfeited to the extent so provided in the award agreement, as determined by
the Committee, in its sole discretion.

    

    (iv)           In
the event of the participant’s retirement, disability or death, or in cases of
special circumstances, the Committee may, in its sole discretion, waive in whole
or in part any or all of the remaining limitations imposed hereunder (if any)
with respect to any or all of an award under this Section 6.

    

    (v)           Each
award under this Section 6 shall be confirmed by, and subject to the terms of,
an agreement or other instrument by the Company and by the
participant.

    

    (vi)           Stock
(including securities convertible into Stock) issued on a bonus basis under this
Section 6 may be issued for no cash consideration.  Stock (including
securities convertible into Stock) purchased pursuant to a purchase right
awarded under this Section 6 shall be priced at least 50% of the Fair Market
Value of the Stock on the date of grant.

    

    

    

    SECTION 7.  Change
in Control Provisions

    

    (a)           Impact of
Event.  In the event of a “Change in Control” as defined in
Section 7(b) unless otherwise decided by the Committee, the following
acceleration and valuation provisions shall apply:

    

    (i)           Any
Stock Apprecation Rights (including, without limitation, any Limited
Appreciation Rights) outstanding for at least six months and any Stock Options
awarded under the Plan not previously exercisable and vested shall become fully
exercisable and vested.

    

    (ii)           The
restrictions and deferral limitations applicable to any Restricted Stock,
Deferred Stock, Stock Purchase rights and Other Stock-Based Awards, in each case
to the extent not already vested under the Plan, shall lapse and such shares and
awards shall be deemed fully vested.

    

    (iii)           The
value of all outstanding Stock Options, Stock Appreciation Rights, Restricted
Stock, Deferred Stock, Stock Purchase Rights and Other Stock-Based Awards, in
each case to the extent vested, shall, unless otherwise determined by the
Committee in its sole discretion at or after grant but prior to any Change in
Control, be cashed out on the basis of the “Change in Control Price” as defined
in Section 7(d) as of the date such Change in Control is determined to have
occurred or such other date as the Committee may determine prior to the Change
in Control.

    

    (b)           Definition of “Change in
Control”.  For purposes of Section 7(a), a “Change in Control”
means the happening of any of the following:

    

    (i)           When
any “person” as defined in Section 3(a)(9) of the Exchange Act and as used in
Section 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d)
of the Exchange Act but excluding the Company and any Subsidiary and any
employee benefit plan sponsored or maintained by the Company or any Subsidiary
(including any trustee of such plan acting as trustee), directly or indirectly,
becomes the “beneficial owner” (as defined in Rule 13(d)-3 under the Exchange
Act, as amended from time to time), of securities of the Company representing 20
percent or more of the combined voting power of the Company’s then outstanding
securities;

    

    (ii)           When,
during any period of 24 consecutive months during the existence of the Plan, the
individuals who, at the beginning of such period, constitute the Board (the
“Incumbent Directors”) cease for any reason other than death to constitute at
least a majority thereof, provided, however, that a director who was not a
director at the beginning of such 24-month period shall be deemed to have
satisfied such 24-month requirement (and be an Incumbent Director) if such
director was elected by, or on the recommendation of or with the approval of, at
least two-thirds of the directors who then qualified as Incumbent Directors
either actually (because they were directors at the beginning of such 24-month
period) or by prior operation of this Section 7(b)(ii); or

    

    (iii)           The
occurrence of a transaction requiring stockholder approval for the acquisition
of the Company by an entity other than the Company or a Subsidiary through
purchase of assets, or by merger, or otherwise.

    

    (c)           Change in Control
Price.  For purposes of this Section 7, “Change in Control
Price” means the highest price per share bid in any transaction reported on the
NASDAQ System, or paid or offered in any bona fide transaction related to a
Change in Control of the Company at any time during the 60 day period
immediately preceding the occurrence of the Change in Control, in each case as
determined by the Committee except that, in the case of Incentive Stock Options
and Stock Appreciation Rights relating to Incentive Stock Options, such price
shall be based only on transactions reported for the date on which the optionee
exercises such Stock Appreciation Rights (or Limited Stock Appreciation Rights)
or, where applicable, the date on which a cashout occurs under Section
7(a)(ii).

    

    

    

    SECTION
8.  Amendment and Termination

    

    The Board may amend, alter, or
discontinue the Plan, but no amendment, alteration, or discontinuation shall be
made which would impair the rights of an optionee or participant under a Stock
Option, Stock Appreciation Right (or Limited Stock Appreciation Right),
Restricted or Deferred Stock award, Stock Purchase Right or Other Stock-Based
Award theretofore granted, without the optionee’s or participant’s consent, or
which, without the approval of the Company’s stockholders, would cause the Plan
to no longer comply with Rule 16b-3 under the Exchange Act or any successor rule
or other regulatory requirements.

    

    The Committee may amend the terms of
any Stock Option or other award theretofore granted, prospectively or
retroactively, but, subject to Section 3 above, no such amendment shall impair
the rights of any holder without the holder’s consent.

    

    Subject to the above provisions, the
Board shall have broad authority to amend the Plan to take into account changes
in applicable securities and tax laws and accounting rules.

    

    

    

    SECTION
9.  Unfunded Status of Plan

    

    The Plan is intended to constitute an
“unfunded” plan for incentive and deferred compensation.  With respect
to any payments not yet made to a participant or optionee by the Company,
nothing contained herein shall give any such participant or optionee any rights
that are greater than those of a general creditor of the Company.  In
its sole discretion, the Committee may authorize the creation of trusts or other
arrangements to meet the obligations created under the Plan to deliver Stock or
payments in lieu of or with respect to awards hereunder, provided, however,
that, unless the Committee otherwise determines with the consent of the affected
participant, the existence of such trusts or other arrangements is consistent
with the “unfunded” status of the Plan.

    

    

    

    SECTION
10.  General Provisions

    

    (a)           The
Committee may require each person purchasing shares pursuant to a Stock Option
or other award under the Plan to represent and to agree with the Company in
writing that the optionee or participant is acquiring the shares without a view
to distribution thereof.  The certificates for such shares may include
any legend which the Committee deems appropriate to reflect any restrictions on
transfer.

    

    All certificates for shares of Stock or
other securities delivered under the Plan shall be subject to such
stock-transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations, and other requirements of the Securities and
Exchange Commission, any stock exchange upon which the Stock is then listed, and
any applicable Federal or state securities law, and the Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.

    

    (b)           Nothing
contained in the Plan shall prevent the Board from adopting other or additional
compensation arrangements, subject to stockholder approval if such approval is
required; and such arrangements may be either generally applicable or applicable
only in specific cases.

    

    (c)           The
adoption of the Plan shall not confer upon any employee of the Company or any
Subsidiary or Affiliate any right to continued employment with the Company or a
Subsidiary or Affiliate, as the case may be, nor shall it interfere in any way
with the right of the Company or a Subsidiary or Affiliate to terminate the
employment of any of its employees at any time.

    (d)           No
later than the date as of which an amount first becomes includible in the gross
income of the participant for Federal income tax purposes with respect to any
award under the Plan, the participant shall pay to the Company, or make
arrangements satisfactory to the Committee regarding the payment of, any
Federal, state, or local taxes of any kind required by law to be withheld with
respect to such amount.  Unless otherwise determined by the Committee,
withholding obligations may be settled with Stock, including Stock that is part
of the award that gives rise to the withholding requirement.  The
obligations of the Company under the Plan shall be conditional on such payment
or arrangements and the Company and its Subsidiaries and Affiliates shall, to
the extent permitted by law, have the right to deduct any such taxes from any
payment or any kind otherwise due to the participant.

    

    (e)           The
actual or deemed reinvestment of dividends or dividend equivalents in additional
Restricted Stock (or in Deferred Stock or other types of Plan awards) at the
time of any dividend payment shall be permissible only if sufficient shares of
Stock are available under Section 3 for such reinvestment (taking into account
then outstanding Stock Options, Stock Purchase Rights and other Plan
awards).

    

    (f)           The
Plan and all awards made and actions taken thereunder shall be governed by and
construed in accordance with the laws of the State of Delaware.

    

    

    

    SECTION
11.  Effective Date of Plan

    

    The Plan shall be effective as of June
28, 1995, subject to the approval of the Plan by a majority of the votes cast by
the holders of Stock at the next annual stockholder’s meeting in
1995.  Any grants made under the Plan prior to such approval shall be
effective when made (unless otherwise specified by the Committee at the time of
grant), but shall be conditioned on, and subject to, such approval of the Plan
by such shareholders.

    

    

    

    SECTION 12.  Term
of Plan

    

    No Stock Option or Other Stock-Based
Award shall be granted pursuant to the Plan on or after the tenth anniversary of
the date of stockholder approval, but awards granted prior to such tenth
anniversary may extend beyond that date.ex_10-2.htm

    

     

    CONVERA
CORPORATION

     

    AMENDED
AND RESTATED 2000 STOCK OPTION PLAN

     

    -------------------------------

     

    SECTION
1.                                Purpose;
Definitions

     

    The
purpose of the Convera Corporation Amended and Restated 2000 Stock Option Plan
(the "Plan") is to enable Convera Corporation (the "Company") to attract, retain
and reward officers, directors and key employees of the Company and its
Subsidiaries and Affiliates and any other individual as determined by the
Committee who is responsible for or contributes to the management, growth and/or
profitability of the business of the Company and/or its Subsidiaries and
Affiliates, and strengthen the mutuality of interests between such persons and
the Company's stockholders, by offering such persons performance-based stock
incentives and/or other equity interests or equity-based incentives in the
Company, as well as performance-based incentives payable in cash.

     

    For
purposes of the Plan, the following terms shall be defined as set forth
below:

     

    (a)           "Affiliate"
means a Parent or a Subsidiary.

     

    (b)           "Board"
means the Board of Directors of the Company.

     

    (c)           "Book
Value" means, as of any given date, on a per share basis (i) the stockholders'
Equity in the Company as of the end of the immediately preceding fiscal year as
reflected in the Company's consolidated balance sheet, subject to such
adjustments as the Committee shall specify at or after grant, divided by (ii)
the number of then outstanding shares of Stock as of such year-end date (as
adjusted by the Committee for subsequent events).

     

    (d)           "Code"
means the Internal Revenue Code of 1986, as amended, and any successor
thereto.

     

    (e)           "Committee"
means the committee of the Board consisting solely of two or more persons who
are (i) “nonemployee directors” within the meaning of Rule 16b-3 under the
Exchange Act, or any successor rule or regulation and (ii) “outside directors”
within the meaning of Section 162(m) of the Code; provided however, that clause
(ii) shall apply only with respect to grants of Options intended by the
Committee to qualify as performance-based compensation within the meaning of
Section 162(m) of the Code, and the Regulations thereunder.  If at any
time no Committee shall be in office, then the functions of the Committee
specified in the Plan shall be exercised by the Board.

     

    (f)           "Company"
means Convera Corporation, a corporation organized under the laws of the State
of Delaware, or any successor corporation.

     

    (g)           "Deferred
Stock" means an award made pursuant to Section 8 below of the right to
receive Stock at the end of a specified deferral period.

     

    (h)           "Disability"
means disability as determined under procedures established by the Committee for
purposes of this Plan.

     

    (i)           "Fair
Market Value" means, as of any given date, unless otherwise determined by the
Committee in good faith, the mean between the highest and lowest quoted bid
price, regular way, of the Stock on the NASDAQ System or, if no such sale of
Stock occurs on such date, the fair market value of the Stock as determined by
the Committee in good faith in accordance with Section 422 of the
Code.

     

    (j)           "Incentive
Stock Option" means any Stock Option intended to be and designated as an
"Incentive Stock Option" within the meaning of Section 422 of the
Code.

     

    (k)           "Non-Employee
Directors" shall have the meaning set forth in Rule 16b-3 as promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934
(the "Exchange Act"), or any successor definition adopted by the
Commission.

     

    (1)           "Non-Qualified
Stock Option" means any Stock Option that is not an Incentive Stock
Option.

     

    (m)           “Optionee”
means a person to whom a Stock Option has been granted under the
Plan.

     

    (n)           "Other
Stock-Based Award" means an award under Section 10 below that is valued in
whole or in part by reference to, or is otherwise based on, Stock.

     

    (o)           “Parent”
means any corporation, which is a parent corporation (within the meaning of
Section 424(e) of the Code) with respect to the Company.

     

    (p)           "Restricted
Stock" means an award of shares of Stock that is subject to restrictions under
Section 7 below.

     

    (q)           "Stock"
means the Class A Common Stock, $.01 par value per share, of the
Company.

     

    (r)           "Stock
Appreciation Right" means the right pursuant to an award granted under
Section 6 below to surrender to the Company all (or a portion) of a Stock
Option in exchange for an amount equal to the difference between (i) the Fair
Market Value, as of the date such Stock Option (or such portion thereof) is
surrendered, of the shares of Stock covered by such Stock Option (or such
portion thereof), subject, where applicable, to the pricing provisions in
Section 6(b)(ii) and (ii) the aggregate exercise price of such Stock Option
(or such portion thereof).

     

    (s)           "Stock
Option" or "Option" means any option to purchase shares of Stock (including
Restricted Stock and Deferred Stock, if the Committee so determines) granted
pursuant to Section 5 below.

     

    (t)           "Stock
Purchase Right" means the right to purchase Stock pursuant to
Section 9.

     

    (u)           "Subsidiary"
means any corporation that is a subsidiary corporation (within the meaning of
Section 424(f) of the Code) with respect to the Company.

     

    (v)           "Ten-Percent
Stockholder" means an eligible Plan participant, who, at the time an Incentive
Stock Option is to be granted to him or her, owns (within the meaning of Section
422(b)(6) of the Code) stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company, or of a Parent or
a Subsidiary.

     

    In
addition, the term "Cause" shall have the meaning set forth in Section 5(h)
below.

     

    SECTION
2.                                Administration

     

    The Plan
shall be administered by the Committee.  The functions of the
Committee specified in the Plan shall be exercised by the Board, if and to the
extent that no Committee exists which has the authority to so administer the
Plan.

     

    The
Committee shall have full authority to grant, pursuant to the terms of the Plan,
to officers, directors and other key employees and any other individual as
determined by the Committee who is responsible for or contributes to the
management, growth and/or profitability of the business of the Company and/or
its Subsidiaries and Affiliates eligible under Section 4: (i) Stock
Options, (ii) Stock Appreciation Rights, (iii) Restricted Stock, (iv) Deferred
Stock, (v) Stock Purchase Rights and/or (vi) Other Stock-Based
Awards.  In particular, the Committee shall have the
authority:

     

    (a)           to
select the officers, directors and other key employees of the Company and its
Subsidiaries and Affiliates and any other individual as determined by the
Committee who is responsible for or contributes to the management, growth and/or
profitability of the business of the Company and/or its Subsidiaries and
Affiliates to whom Stock Options, Stock Appreciation Rights, Restricted Stock,
Deferred Stock, Stock Purchase Rights and/or Other Stock-Based Awards may from
time to time be granted hereunder;

     

    (b)           to
determine whether and to what extent Incentive Stock Options, Non-Qualified
Stock Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock,
Stock Purchase Rights and/or Other Stock-Based Awards, or any combination
thereof, are to be granted hereunder to one or more eligible officers,
directors, employees and any other individual as determined by the Committee who
is responsible for or contributes to the management, growth and/or profitability
of the business of the Company and/or its Subsidiaries and
Affiliates;

     

    (c)           to
determine the number of shares to be covered by each such award granted
hereunder;

     

    (d)           to
determine the terms and conditions, not inconsistent with the terms of the Plan,
of any award granted hereunder (including, but not limited to, the share price
and any restriction or limitation, or any vesting acceleration or waiver of
forfeiture restrictions regarding any Stock Option or other award and/or the
shares of Stock relating thereto, based in each case on such factors as the
Committee shall determine, in its sole discretion);

     

    (e)           to
determine whether and under what circumstances a Stock Option may be settled in
cash, Restricted Stock and/or Deferred Stock under Section 5(j) or (k), as
applicable, instead of Stock;

     

    (f)           to
determine whether, to what extent and under what circumstances grants and/or
other awards under the Plan and/or other cash awards made by the Company are to
be made, and operate, on a tandem basis vis-à-vis other awards under the Plan
and/or cash awards made outside of the Plan, or on an additive
basis;

     

    (g)           to
determine whether, to what extent and under what circumstances Stock and other
amounts payable with respect to an award under this Plan shall be deferred
either automatically or at the election of the participant (including providing
for and determining the amount (if any) of any deemed earnings on any deferred
amount during any deferral period);

     

    (h)           to
determine the terms and restrictions applicable to Stock Purchase Rights and the
Stock purchased by exercising such Rights; and

     

    (i)           to
grant with the consent of the optionee, in substitution for outstanding Stock
Options, replacement Stock Options, which may be at a lower exercise price,
provided that, in the case of Incentive Stock Options, at an exercise price less
than the Fair Market Value of the Stock at the time of replacement.

     

    The
Committee shall have the authority to adopt, alter and repeal such rules,
guidelines and practices governing the Plan as it shall, from time to time, deem
advisable; to interpret the terms and provisions of the Plan and any award
issued under the Plan (and any agreements relating thereto); and to otherwise
supervise the administration of the Plan.

     

    All
decisions made by the Committee pursuant to the provisions of the Plan shall be
made in the Committee's sole discretion and shall be final and binding on all
persons, including the Company and Plan participants.

     

    SECTION
3.                                Stock
Subject to Plan, Limits

     

    (a)           General.
The total number of shares of Stock reserved and available for distribution
under the Plan shall be 14,250,000 shares.  Such shares may consist,
in whole or in part, of authorized and unissued shares or treasury
shares.  Subject to Section 6(b)(iv) below, if any shares of
Stock that have been optioned cease to be subject to a Stock Option, or if any
such shares of Stock that are subject to any Restricted Stock or Deferred Stock
award, Stock Purchase Right or Other Stock-Based Award granted hereunder are
forfeited or any such award otherwise terminates, without a payment being made
to the participant in the form of Stock, such shares shall again be available
for distribution in connection with future awards under the Plan.

     

    In the
event of any merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, spin-offs, spin-outs or other change in corporate
structure affecting the Stock, such substitution or adjustment shall be made in
the aggregate number of shares reserved for issuance under the Plan, in the
number and option price of shares subject to outstanding Options granted under
the Plan, in the number and purchase price of shares subject to outstanding
Stock Purchase Rights under the Plan, and in the number of shares subject to
other outstanding awards granted under the Plan as may be determined to be
appropriate by the Committee, in its sole discretion, provided that the number
of shares subject to any award shall always be a whole number.  Such
adjusted option price shall also be used to determine the amount payable by the
Company upon the exercise of any Stock Appreciation Right associated with any
Stock Option.

     

    Any such
adjustment in the Stock or securities subject to outstanding Incentive Stock
Options (including any adjustments in the purchase price) shall be made in such
manner as not to constitute a modification as defined by Section 424(h)(3) of
the Code and only to the extent otherwise permitted by Sections 422 and 424 of
the Code.

     

    (b) Section
162(m).  Awards under this Plan are eligible for qualification as
performance based compensation within the meaning of Code Section 162(m), if
that is the intent at the time of grant. In the case of Stock Options and Stock
Appreciation Rights, in addition to the other requirements of Section 162(m),
the annual limit of shares of Stock subject to such awards shall not exceed 2
million shares to any individual.  In the case of other awards of
Stock or cash which are intended to qualify as performance based compensation
under Section 162(m), such awards must meet the conditions in the following
paragraph and such annual awards to any individual may not exceed 2 million
shares in the case of awards in Stock or $3 million in the case of awards in
cash.

     

    (c) To
qualify as a performance based award (except in the case of Stock Options or
Stock Appreciation Rights that otherwise qualify) the award must be subject to a
performance condition (i) that is established (A) at the time an award is
granted or (B) no later than the earlier of (1) 90 days after the beginning of
the period of service to which it relates, or (2) before the elapse of 25% of
the period of service to which it relates, (ii) that is uncertain of achievement
at the time it is established, and (iii) the achievement of which is
determinable by a third party with knowledge of the relevant
facts.  Examples of measures that may be used include net order
dollars, net profit dollars, net profit growth, net revenue dollars, revenue
growth, individual performance, earnings per share, return on assets, return on
equity, and other financial objectives, objective customer satisfaction
indicators and efficiency measures, each with respect to the Company and/or an
Affiliate or individual business unit.

     

    SECTION
4.                                Eligibility

     

    Officers,
directors and key employees of the Company and its Subsidiaries and Affiliates
and any other individual as determined by the Committee who are responsible for
or contribute to the management, growth and/or profitability of the business of
the Company and/or its Subsidiaries and Affiliates are eligible to be granted
awards under the Plan.

     

    SECTION
5.                                Stock
Options

     

    Stock
Options may be granted alone, in addition to or in tandem with other awards
granted under the Plan and/or cash awards made outside of the
Plan.  Any Stock Option granted under the Plan shall be in such form
as the Committee may from time to time approve.

     

    Stock
Options granted under the Plan may be of two types: (i) Incentive Stock Options
and (ii) Non-Qualified Stock Options.

     

    The
Committee shall have the authority to grant to any optionee Incentive Stock
Options, Non-Qualified Stock options, or both types of Stock Options (in each
case with or without Stock Appreciation Rights).

     

    Options
granted under the Plan shall be subject to the following terms and conditions
and shall contain such additional terms and conditions, not inconsistent with
the terms of the Plan, as the Committee shall deem desirable:

     

    (a)           Option
Price.  The option price per share of Stock purchasable under an
Incentive Stock Option shall be determined by the Committee at the time of grant
but shall (i) except as provided in clause (ii) of this Section 5(a), be not
less than 100% of the Fair Market Value of the Stock at the time of grant and
(ii) with respect to any Incentive Stock Option granted to a Ten-Percent
Stockholder, not less than 110% of the Fair Market Value of the Stock at the
time of the grant.  Non-Qualified Stock Options may, in the discretion
of the Committee, may be granted at a price per share less than the Fair Market
Value of the Stock at the time of grant.

     

    (b)           Option
Term.  The term of each Stock Option shall be fixed by the Committee,
but no Stock Option shall be exercisable more than ten years after the date the
option is granted (five years in the case of an Incentive Stock Option granted
to a Ten-Percent Stockholder).

     

    (c)           Exercisability.  Stock
Options shall be exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Committee at or after
grant.  If the Committee provides, in its sole discretion, that any
Stock Option is exercisable only in installments, the Committee may waive such
installment exercise provisions at any time at or after grant in whole or in
part, based on such factors as the Committee shall determine, in its sole
discretion.

     

    (d)           Method
of Exercise.  Subject to whatever installment exercise provisions
apply under Section 5(c), Stock Options may be exercised in whole or in
part at any time during the option period by giving written notice of exercise
to the Company specifying the number of shares to be purchased.  Such
notice shall be accompanied by payment, if any,  in full of the
purchase price, by such manner as the Committee may accept.  As
determined by the Committee, in its sole discretion, at or after grant, payment
in full or in part may be made in the form of check, Stock, including any
cashless method approved by the Committee, in the case of the exercise of a
Non-Qualified Stock Option, Restricted Stock or Deferred Stock subject to an
award hereunder (based, in each case, on the Fair Market Value of the Stock on
the date the option is exercised, as determined by the Committee), or any other
legally permissible method.

     

    No shares
of Stock shall be issued until full payment therefor has been
made.  An optionee shall generally have the rights to dividends or
other rights of a shareholder with respect to shares subject to the Stock Option
when the optionee has given written notice of exercise, has paid in full for
such shares, and if requested, has given the representation described in
Section 13(a).

     

    (e)           Non-Transferability
of Options.  No Stock Option shall be transferable by the optionee
otherwise than by will or by the laws of descent and distribution, and all Stock
Options shall be exercisable, during the optionee's lifetime, only by the
optionee.

     

    (f)           Termination
by Death.  Subject to Section 5(j), if an optionee's employment
by the Company or any Subsidiary or Affiliate terminates by reason of death, any
Stock Option held by such optionee may thereafter be exercised, to the extent
such option was exercisable at the time of death or on such accelerated basis as
the Committee may determine at or after grant (or as may be determined in
accordance with procedures established by the Committee), by the legal
representative of the estate or by the legatee of the optionee under the will of
the optionee, for a period of one year (or such other period as the Committee
may specify at grant) from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter.

     

    (g)           Termination
by Reason of Disability.  Subject to Section 5(j), if an
optionee's employment by the Company and any Subsidiary or Affiliate terminates
by reason of Disability, any Stock Option held by such optionee may thereafter
be exercised by the optionee, to the extent it was exercisable at the time of
termination or on such accelerated basis as the Committee may determine at or
after grant (or as may be determined in accordance with procedures established
by the Committee), for a period of one year (or such other period as the
Committee may specify at grant) from the date of such termination of employment
or until the expiration of the stated term of such Stock Option, whichever
period is the shorter, provided, however, that, if the optionee dies within such
one-year period (or such other period as the Committee shall specify at grant),
any unexercised Stock Option held by such optionee shall thereafter be
exercisable to the extent to which it was exercisable at the time of death for a
period of one year from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter.  In
the event of termination of employment by reason of Disability, if an Incentive
Stock Option is exercised after the expiration of the exercise periods that
apply for purposes of Section 422 of the Code, such Stock Option will
thereafter be treated as a Non-Qualified Stock Option.

     

    (h)           Other
Termination.  Unless otherwise determined by the Committee (or
pursuant to procedures established by the Committee) at or after grant, if an
optionee's employment by the Company or any Subsidiary or Affiliate terminates
for any reason other than death or Disability, the Stock Option shall thereupon
terminate, except that such Stock Option may be exercised, to the extent
otherwise then exercisable, for the lesser of three months or the balance of
such Stock Option's term if the optionee is involuntarily terminated by the
Company or any Subsidiary or Affiliate without Cause.  For purposes of
this Plan, "Cause" means a felony conviction of an optionee or the failure of an
optionee to contest prosecution for a felony, or an optionee's willful
misconduct or dishonesty, any of which is directly and materially harmful to the
business or reputation of the Company or any Subsidiary or
Affiliate.

     

    (i)           Incentive
Stock Options.  Anything in the Plan to the contrary notwithstanding,
no term of this Plan relating to Incentive Stock Options shall be interpreted,
amended or altered, nor shall any discretion or authority granted under the Plan
be so exercised, so as to disqualify the Plan under Section 422 of the
Code, or, without the consent of the optionee(s) affected, to disqualify any
Incentive Stock Option under such Section 422.

     

    To the
extent that the aggregate Fair Market Value  (determined as of the
date of grant) of Stock for which Incentive Stock Options are exercisable for
the first time by any Optionee during any calendar year (under all plans of the
Company and its Subsidiaries) exceeds $100,000, such excess Incentive Stock
Options shall be treated as Nonqualified Stock Options.

     

    (j)           Buyout
Provisions.  The Committee may at any time offer to buy out for a
payment in cash, Stock, Deferred Stock or Restricted Stock an option previously
granted, based on such terms and conditions as the Committee shall establish and
communicate to the optionee at the time that such offer is made.

     

    (k)           Settlement
Provisions.  If the option agreement so provides at grant or is
amended after grant and prior to exercise to so provide (with the optionee's
consent), the Committee may require that all or part of the shares to be issued
with respect to the spread value of an exercised Option take the form of
Deferred or Restricted Stock, which shall be valued on the date of exercise on
the basis of the Fair Market Value (as determined by the Committee) of such
Deferred or Restricted Stock determined without regard to the deferral
limitations and/or forfeiture restrictions involved.

     

    SECTION
6.                                Stock
Appreciation Rights

     

    (a)           Grant
and Exercise.  Stock Appreciation Rights may be granted in conjunction
with all or part of any Stock Option granted under the Plan.  In the
case of a Non-Qualified Stock Option, such rights may be granted either at or
after the time of the grant of such Stock Option.  In the case of an
Incentive Stock Option, such rights may be granted only at the time of the grant
of such Stock Option.

     

    A Stock
Appreciation Right or applicable portion thereof granted with respect to a given
Stock Option shall terminate and no longer be exercisable upon the termination
or exercise of the related Stock Option, subject to such provisions as the
Committee may specify at grant where a Stock Appreciation Right is granted with
respect to less than the full number of shares covered by a related Stock
Option.

     

    A Stock
Appreciation Right may be exercised by an optionee, subject to
Section 6(b), in accordance with the procedures established by the
Committee for such purpose.  Upon such exercise, the optionee shall be
entitled to receive an amount determined in the manner prescribed in
Section 6(b).  Stock Options relating to exercised Stock
Appreciation Rights shall no longer be exercisable to the extent that the
related Stock Appreciation Rights have been exercised.

     

    (b)           Terms
and Conditions.  Stock Appreciation Rights shall be subject to such
terms and conditions, not inconsistent with the provisions of the Plan, as shall
be determined from time to time by the Committee, including the
following:

     

    (i)           Stock
Appreciation Rights shall be exercisable only at such time or times and to the
extent that the Stock Options to which they relate shall be exercisable in
accordance with the provisions of Section 5 and this Section 6 of the
Plan; provided, however, that any Stock Appreciation Right granted to an
optionee subject to Section 16(b) of the Exchange Act subsequent to the
grant of the related Stock Option shall not be exercisable during the first six
months of its term, except that this special limitation shall not apply in the
event of death or Disability of the optionee prior to the expiration of the
six-month period.  The exercise of Stock Appreciation Rights held by
optionees who are subject to Section 16(b) of the Exchange Act shall comply
with Rule 16b-3 thereunder, to the extent applicable.

     

    (ii)           Upon
the exercise of a Stock Appreciation Right, an optionee shall be entitled to
receive an amount in cash and/or shares of Stock equal in value to the excess of
the Fair Market Value of one share of Stock over the option price per share
specified in the related Stock Option multiplied by the number of shares in
respect of which the Stock Appreciation Right shall have been exercised, with
the Committee having the right to determine the form of payment.  When
payment is to be made in shares, the number of shares to be paid shall be
calculated on the basis of the Fair Market Value of the shares on the date of
exercise.  When payment is to be made in cash, such amount shall be
calculated on the basis of the average of the highest and lowest quoted bid
price, of the Stock on the NASDAQ System during the applicable period referred
to in Rule 16b-3(e) under the Exchange Act.

     

    (iii)           Stock
Appreciation Rights shall be transferable only when and to the extent that the
underlying Stock Option would be transferable under
Section 5(e).

     

    (iv)           Upon
the exercise of a Stock Appreciation Right, the Stock Option or part thereof to
which such Stock Appreciation Right is related shall be deemed to have been
exercised for the purpose of the limitation set forth in Section 3 on the
number of shares of Stock to be issued under the Plan, but only to the extent of
the number of shares issued under the Stock Appreciation Right at the time of
exercise based on the value of the Stock Appreciation Right at such
time.

     

    SECTION
7.                                Restricted
Stock

     

    (a)           Administration.  Shares
of Restricted Stock may be issued either alone, in addition to or in tandem with
other awards granted under the Plan and/or cash awards made outside the
Plan.  The Committee shall determine the eligible persons to whom, and
the time or times at which, grants of Restricted Stock will be made, the number
of shares to be awarded, the price (if any) to be paid by the recipient of
Restricted Stock (subject to Section 7(b)), the time or times within which
such awards may be subject to forfeiture, and all other terms and conditions of
the awards.

     

    The
Committee may condition the grant of Restricted Stock upon the attainment of
specified performance goals or such other factors as the Committee may
determine, in its sole discretion.

     

    The
provisions of Restricted Stock awards need not be the same with respect to each
recipient.

     

    (b)           Awards
and Certificates.  The prospective recipient of a Restricted Stock
award shall not have any rights with respect to such award, unless and until
such recipient has executed an agreement evidencing the award and has delivered
a fully executed copy thereof to the Company, and has otherwise complied with
the applicable terms and conditions of such award.

     

    (i)           The
purchase price for shares of Restricted Stock may be equal to or less than their
par value and may be zero.

     

    (ii)           Awards
of Restricted Stock must be accepted within a period of 60 days (or such shorter
period as the committee may specify at grant) after the award date, by executing
a Restricted Stock Award Agreement and paying whatever price (if any) is
required under Section 7(b)(i).

     

    (iii)           Each
participant receiving a Restricted Stock award shall be issued a stock
certificate in respect of such shares of Restricted Stock.  Such
certificate shall be registered in the name of such participant, and shall bear
an appropriate legend referring to the terms, conditions, and restrictions
applicable to such award.

     

    (iv)           The
Committee shall require that the stock certificates evidencing such shares be
held in custody by the Company until the restrictions thereon shall have lapsed,
and that, as a condition of any Restricted Stock award, the participant shall
have delivered a stock power, endorsed in blank, relating to the Stock covered
by such award.

     

    (c)           Restrictions
and Conditions.  The shares of Restricted Stock awarded pursuant to
this Section 7 shall be subject to the following restrictions and
conditions:

     

    (i)           Subject
to the provisions of this Plan and the award agreement, during a period set by
the Committee commencing with the date of such award (the "Restricted Period"),
the participant shall not be permitted to sell, transfer, pledge or assign
shares of Restricted Stock awarded under the Plan.  Within these
limits, the Committee, in its sole discretion, may provide for the lapse of such
restrictions in installments and may accelerate or waive such restriction in
whole or in part, based on service, performance and/or such other factors or
criteria as the Committee may determine, in its sole discretion.

     

    (ii)           Except
as provided in this paragraph (ii) and Section 7(c)(i), the participant
shall have, with respect to the shares of Restricted Stock, all of the rights of
a stockholder of the Company, including the right to vote the shares and the
right to receive any cash dividends.  The Committee, in its sole
discretion, as determined at the time of award, may permit or require the
payment of cash dividends to be deferred and, if the Committee so determines,
reinvested, subject to Section 14(e), in additional Restricted Stock, to
the extent shares are available under Section 3, or otherwise
reinvested.  Pursuant to Section 3 above, Stock dividends issued
with respect to Restricted Stock shall be treated as additional shares of
Restricted Stock that are subject to the same restrictions and other terms and
conditions that apply to the shares with respect to which such dividends are
issued.

     

    (iii)           Subject
to the applicable provisions of the award agreement and this Section 7,
upon termination of a participant's employment with the Company or any
Subsidiary or Affiliate for any reason during the Restriction Period, all shares
still subject to restriction will vest or be forfeited, in accordance with the
terms and conditions established by the Committee at or after
grant.

     

    (iv)           If
and when the Restricted Period expires without a prior forfeiture of the
Restricted Stock subject to such Restricted Periods, certificates for an
appropriate number of unrestricted shares shall be delivered to the participant
promptly.

     

    (d)           Minimum
Value Provisions.  In order to better ensure that award payments
actually reflect the performance of the Company and service of the participant,
the Committee may provide, in its sole discretion, for a tandem
performance-based or other award designed to guarantee a minimum value, payable
in cash or Stock to the recipient of a Restricted Stock award, subject to such
performance, future service deferral and other terms and conditions as may be
specified by the Committee.

     

    SECTION
8.                                Deferred
Stock

     

    (a)           Administration.  Deferred
Stock may be awarded either alone, in addition to or in tandem with other awards
granted under the Plan and/or cash awards made outside of the
Plan.  The Committee shall determine the eligible persons to whom and
the time or times at which Deferred Stock shall be awarded, the number of shares
of Deferred Stock to be awarded to any person, the duration of period (the
"Deferral Period") during which, and the conditions under which, receipt of the
Stock will be deferred, and the other terms and conditions of the award in
addition to those set forth in Section 8(b).

     

    The
Committee may condition the grant of Deferred Stock upon the attainment of
specified performance goals or such other factors or criteria as the Committee
shall determine, in its sole discretion.

     

    The
provisions of Deferred Stock awards need not be the same with respect to each
recipient.

     

    (b)           Terms
and Conditions.  The shares of Deferred Stock awarded pursuant to this
Section 8 shall be subject to the following terms and
conditions:

     

    (i)           Subject
to the provisions of this Plan and the award agreement referred to in
Section 8(b)(vi) below, Deferred Stock awards may not be sold, assigned,
transferred, pledged or otherwise encumbered during the Deferral
Period.  At the expiration of the Deferral Period (or the Elective
Deferral Period referred to in Section 8(b)(v), where applicable), share
certificates shall be delivered to the participant, or his legal representative,
in a number equal to the shares covered by the Deferred Stock
award.

     

    (ii)           Unless
otherwise determined by the Committee at grant, amounts equal to any dividends
declared during the Deferral Period with respect to the number of shares covered
by a Deferred Stock award shall be paid to the participant currently, or
deferred and deemed to be reinvested in additional Deferred Stock, or otherwise
reinvested, all as determined at or after the time of the award by the
Committee, in its sole discretion.

     

    (iii)           Subject
to the provision of the award agreement and this Section 8, upon
termination of a participant's employment with the Company or Subsidiary or
Affiliate for any reason during the Deferral Period for a given award, the
Deferred Stock in question will vest or be forfeited, in accordance with the
terms and conditions established by the Committee at or after
grant.

     

    (iv)           Based
on service, performance and/or such other factors or criteria as the Committee
may determine, the Committee may, at or after grant, accelerate the vesting of
all or any part of any Deferred Stock award and/or waive the deferral
limitations for all or any part of such award.

     

    (v)           A
participant may elect to further defer receipt of an award (or an installment of
an award) for a specified period or until a specified event (the "Elective
Deferral Period"), subject in each case to the Committee's approval and to such
terms as are determined by the Committee, all in its sole
discretion.  Subject to any exceptions adopted by the Committee, such
election must generally be made at least one year prior to completion of the
Deferral Period for such Deferred Stock award (or such
installment).

     

    (vi)           Each
award shall be confirmed by, and subject to the terms of, a Deferred Stock
agreement executed by the Company and the participant.

     

    (c)           Minimum
Value Provisions.  In order to better ensure that award payments
actually reflect the performance of the Company and service of the participant,
the Committee may provide, in its sole discretion, for a tandem
performance-based or other award designed to guarantee a minimum value, payable
in cash or Stock to the recipient of a deferred stock award, subject to such
performance, future service, deferral and other terms and conditions as may be
specified by the Committee.

     

    SECTION
9.                                Stock
Purchase Rights

     

    (a)           Awards
and Administration.  Subject to Section 3 above, the Committee
may grant eligible participants Stock Purchase Rights which shall enable such
participants to purchase Stock (including Deferred Stock and Restricted
Stock):

     

    (i)           at
its Fair Market Value on the date of grant;

     

    (ii)           at
50% of such Fair Market Value on such date;

     

    (iii)           at
an amount equal to Book Value on such date; or

     

    (iv)           at
an amount equal to the par value of such Stock on such date.

     

    The
Committee shall also impose such deferral, forfeiture and/or other terms and
conditions as it shall determine, in its sole discretion, on such Stock Purchase
Rights or the exercise thereof.

     

    The terms
of Stock Purchase Rights awards need not be the same with respect to each
participant.

     

    Each
Stock Purchase Right award shall be confirmed by, and be subject to the terms
of, a Stock Purchase Rights Agreement.

     

    (b)           Exercisability.  Stock
Purchase Rights shall generally be exercisable for such period after grant as is
determined by the Committee not to exceed 30 days.  However, the
Committee may provide, in its sole discretion, that the Stock Purchase Rights of
persons potentially subject to Section 16(b) of the Exchange Act shall not
become exercisable until six months and one day after the grant date, and shall
then be exercisable for ten trading days at the purchase price specified by the
Committee in accordance with Section 9(a).

     

    SECTION
10.   Other Stock-Based Awards

     

    (a)           Administration.  Other
awards of Stock and other awards that are valued in whole or in part by
reference to, or are otherwise based on, Stock ("Other Stock-Based Awards"),
including, without limitation, performance shares, convertible preferred stock,
convertible debentures, exchangeable securities and Stock awards or options
valued by reference to Book Value or subsidiary performance, may be granted
either alone or in addition to or in tandem with Stock Options, Stock
Appreciation Rights, Restricted Stock, Deferred Stock or Stock Purchase Rights
granted under the Plan and/or cash awards made outside of the Plan.

     

    Subject
to the provision of the Plan, the Committee shall have authority to determine
the persons to whom and the time or times at which such awards shall be made,
the number of shares of Stock to be awarded pursuant to such awards, and all
other conditions of the awards.  The Committee may also provide for
the grant of Stock upon the completion of a specified performance
period.

     

    The
provisions of Other Stock-Based Awards need not be the same with respect to each
recipient.

     

    (b)           Terms
and Conditions.  Other Stock-Based Awards made pursuant to this
Section 10 shall be subject to the following terms and
conditions:

     

    (i)           Subject
to the provision of the Plan and the award agreement referred to in
Section 10(b)(v) below, shares subject to awards made under this
Section 10 may not be sold, assigned, transferred, pledged 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.

     

    (ii)           Subject
to the provisions of the Plan and the award agreement and unless otherwise
determined by the Committee at grant, the recipient of an award under this
Section 10 shall be entitled to receive, currently or on a deferred basis,
interest or dividends or interest or dividend equivalents with respect to the
number of shares covered by the award, as determined at the time of the award by
the Committee, in its sole discretion, and the Committee may provide that such
amounts (if any) shall be deemed to have been reinvested in additional Stock or
otherwise reinvested.

     

    (iii)           Any
award under this Section 10 and any Stock covered by any such award shall
vest or be forfeited to the extent so provided in the award agreement, as
determined by the Committee, in its sole discretion.

     

    (iv)           In
the event of the participant's retirement, Disability or death, or in cases of
special circumstances, the Committee may, in its sole discretion, waive in whole
or in part any or all of the remaining limitations imposed hereunder (if any)
with respect to any or all of an award under this Section 10.

     

    (v)           Each
award under this Section 10 shall be confirmed by, and subject to the terms
of, an agreement or other instrument by the Company and by the
participant.

     

    (vi)           Stock
(including securities convertible into Stock) issued on a bonus basis under this
Section 10 may be issued for no cash consideration.  Stock
(including securities convertible into Stock) purchased pursuant to a purchase
right awarded under this Section 10 shall be priced at least 50% of the
Fair Market Value of the Stock on the date of grant.

     

    SECTION
11.   Amendment and Termination

     

    The Board
may amend, alter, or discontinue the Plan, but no amendment, alteration, or
discontinuation shall be made which would impair the rights of an optionee or
participant under a Stock Option, Stock Appreciation Right, Restricted or
Deferred Stock award, Stock Purchase Right or Other Stock-Based Award
theretofore granted, without the optionee's or participant's consent, or which,
without the approval of the Company's stockholders, would cause the Plan to no
longer comply with Rule 16b-3 under the Exchange Act or any successor rule
or other regulatory requirements.

     

    The
Committee may amend the terms of any Stock Option or other award theretofore
granted, prospectively or retroactively, but, subject to Section 3 above,
no such amendment shall impair the rights of any holder without the holder's
consent.

     

    Subject
to the above provisions, the Board shall have broad authority to amend the Plan
to take into account changes in applicable securities and tax laws and
accounting rules.

     

    SECTION
12.   Unfunded Status of Plan

     

    The Plan
is intended to constitute an "unfunded" plan for incentive and deferred
compensation.  With respect to any payments not yet made to a
participant or optionee by the Company, nothing contained herein shall give any
such participant or optionee any rights that are greater than those of a general
creditor of the Company.  In its sole discretion, the Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Stock or payments in lieu of or with respect
to awards hereunder, provided, however, that, unless the Committee otherwise
determines with the consent of the affected participant, the existence of such
trusts or other arrangements is consistent with the "unfunded" status of the
Plan.

     

    SECTION
13.   General Provisions

     

    (a)           The
Committee may require each person purchasing shares pursuant to a Stock Option
or other award under the Plan to represent and to agree with the Company in
writing that the optionee or participant is acquiring the shares without a view
to distribution thereof.  The certificates for such shares may include
any legend which the Committee deems appropriate to reflect any restrictions on
transfer.

     

    All
certificates for shares of Stock or other securities delivered under the Plan
shall be subject to such stock-transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Stock is then listed, and any applicable Federal or state securities
law, and the Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference to such restrictions.

     

    (b)           Nothing
contained in the Plan shall prevent the Board from adopting other or additional
compensation arrangements, subject to stockholder approval if such approval is
required; and such arrangements may be either generally applicable or applicable
only in specific cases.

     

    (c)           The
adoption of the Plan shall not confer upon any employee of the Company or any
Subsidiary or Affiliate any right to continued employment with the Company or a
Subsidiary or Affiliate, as the case may be, nor shall it interfere in any way
with the right of the Company or a Subsidiary or Affiliate to terminate the
employment of any of its employees at any time.

     

    

    (d)           The
Company shall have the right to deduct from any distribution of cash to any
Optionee, an amount equal to the federal, state and local income and employment
taxes and other amounts as may be required by law to be withheld (the
"Withholding Taxes") with respect to any Option.  If an Optionee is
entitled to receive Stock upon exercise of a Stock Option, the Optionee shall
pay the Withholding Taxes to the Company prior to the issuance of such
Stock.  In satisfaction of the Withholding Taxes, the Optionee may
make a written election (the "Tax Election"), which may be accepted or rejected
in the discretion of the Committee, to have withheld a portion of the Stock
issuable to him or her upon exercise of the Stock Option having an aggregate
Fair Market Value, on the date preceding the date of exercise, equal to the
Withholding Taxes, provided that in respect of an Optionee who may be subject to
liability under Section 16(b) of the Exchange Act either (i) (A) the Optionee
makes the Tax Election at least six (6) months after the date the Stock Option
was granted, (B) the Stock Option is exercised during the ten day period
beginning on the third business day and ending on the twelfth business day
following the release for publication of the Company's quarterly or annual
statements of earnings (a "Window Period") and (C) the Tax Election is made
during the Window Period in which the Stock Option is exercised or prior to such
Window Period and subsequent to the immediately preceding Window Period or (ii)
(A) the Tax Election is made at least six months prior to the date the Stock
Option is exercised and (B) the Tax Election is irrevocable with respect to the
exercise of all Options which are exercised prior to the expiration of six
months following an election to revoke the Tax
Election.  Notwithstanding the foregoing, the Committee may, by the
adoption of rules or otherwise, (i) modify the provisions in the preceding
sentence or impose such other restrictions or limitations on Tax Elections as
may be necessary to ensure that the Tax Elections will be exempt transactions
under Section 16(b) of the Exchange Act, and (ii) permit Tax Elections to be
made at such other times and subject to such other conditions as the Committee
determines will constitute exempt transactions under Section 16(b) of the
Exchange Act.

     

    If an Optionee makes a disposition,
within the meaning of Section 424(c) of the Code and regulations promulgated
thereunder, of any share or shares  of Stock issued to such Optionee
pursuant to the exercise of an Incentive Stock Option within the two-year period
commencing on the day after the date of transfer of such share or shares of
Stock to the Optionee pursuant to such exercise, the Optionee shall, if required
by the Committee, within
ten (10) days of such disposition, notify the Company thereof, by delivery of
written notice to the Company at its principal executive office, and immediately
deliver to the Company the amount of Withholding Taxes.

     

    (e)           The
actual or deemed reinvestment of dividends or dividend equivalents in additional
Restricted Stock (or in Deferred Stock or other types of Plan awards) at the
time of any dividend payment shall be permissible only if sufficient shares of
Stock are available under Section 3 for such reinvestment (taking into
account then outstanding Stock Options, Stock Purchase Rights and other Plan
awards).

     

    (f)           The
Plan and all awards made and actions taken thereunder shall be governed by and
construed in accordance with the laws of the State of Delaware.

     

    SECTION 14.   Effective
Date of Plan

     

    The Plan
shall be effective as of December 21, 2000, subject to the approval of the Plan
by a majority of the holders of the Stock.  Any grants made under the
Plan prior to such approval shall be effective when made (unless otherwise
specified by the Committee at the time of grant), but shall be conditioned on,
and subject to, such approval of the Plan by such shareholders.

     

    SECTION
15.   Term of Plan

     

    No Stock
Option, Stock Appreciation Right, Restricted Stock award, Deferred Stock award,
Stock Purchase Right or Other Stock-Based Award shall be granted pursuant to the
Plan on or after the tenth anniversary of the date of stockholder approval, but
awards granted prior to such tenth anniversary may extend beyond that
date.

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