Document:

<PAGE>

                              SkyAuction.com, Inc.

                               2000 OMNIBUS PLAN

<PAGE>

                              SkyAuction.com, Inc.

                               2000 OMNIBUS PLAN

                                     INDEX

SECTION                      DESCRIPTION
-------                      -----------

1                            Purpose of the Plan

2                            Definitions

3                            Types of Awards Covered

4                            Administration

5                            Eligibility

6                            Shares of Stock Subject to the Plan

7                            Stock Options

8                            Restricted Stock

9                            Other Stock-Based Incentive Awards

10                           Rights in Event of Death or Disability

11                           Tax Withholding

12                           Acquisition Events

13                           Securities Matters

14                           Amendment or Termination

15                           Company Call Rights; Rights of First Refusal

16                           Unfunded Plan

17                           General Provisions

18                           Plan Effective Date

19                           Plan Termination
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

                              SkyAuction.com, Inc.

                               2000 OMNIBUS PLAN

                                   SECTION 1
                              Purpose of the Plan

1.1    There is hereby adopted the SkyAuction.com, Inc. 2000 Omnibus Plan (the
       "Plan"). The Plan is intended to promote the interests of SkyAuction.com,
       Inc. (the "Company") by providing employees of the Company with
       appropriate incentives and rewards to encourage them to enter into and
       continue in the employ of the Company and to acquire a proprietary
       interest in the long-term success of the Company; and to reward officers,
       other employees, consultants, and directors in fulfilling their
       responsibilities for long-range achievements.

                                   SECTION 2
                                  Definitions

2.1    As used in he Plan, the following definitions apply to the terms
       indicated below:

       a)   "Acquisition Events" shall mean the meaning ascribed to such term in
            Section 12.1 herein.

       b)   "Affiliate" means each of the following: (i) any Subsidiary; (ii)
            any parent corporation of the Company within the meaning of Code
            Section 424(e); (iii) any corporation, trade or business (including,
            without limitation, a partnership or limited liability company)
            which is directly or indirectly controlled 50% or more (whether by
            ownership of stock, assets or an equivalent ownership interest or
            voting interest) by the Company or one of its Affiliates; and (iv)
            any other entity in which the Company or any of its Affiliates has a
            material equity interest and which is designated as an "Affiliate"
            by resolution of the Committee.

       c)   "Agreement" shall mean the written agreement between the Company and
            a Participant evidencing an Award.

       d)   "Award" means any Option, Restricted Stock or Other Stock-Based
            Award granted under the Plan.

       e)   "Beneficial Owner" shall have the meaning set forth in Rule 13d-3
            under the Exchange Act.

                                       1
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       f)   "Board" shall mean the Board of Directors of the Company.

       g)   "Cause" shall mean:

            (1)  the willful and continued failure by the Participant
                 substantially to perform his or her duties and obligations to
                 the Company (other than any such failure resulting from his or
                 her incapacity due to physical or mental illness) or, the
                 performance of any act or the failure to perform any act, which
                 shall entitle the Company to terminate the employment,
                 consultancy, directorship or any other relationship or
                 agreement with such Participant;

            (2)  the willful engaging by the Participant in misconduct which is
                 materially injurious to the Company;

            (3)  the commission by the Participant of a felony; or

            (4)  the commission by the Participant of a crime against the
                 Company. For purposes of this Section 2(f), no act, or failure
                 to act, on a Participant's part shall be considered "willful"
                 unless done, or omitted to be done, by the Participant in bad
                 faith and without reasonable belief that his or her action or
                 omission was in the best interest of the Company.

                 Determination of Cause shall be made by the Committee in its
                 sole discretion, except that Cause shall be deemed to exist if
                 the Participant is a director, and cause for his or her removal
                 exists under any applicable law.

       h)   "Change in Control" means the occurrence of anyone of the following
            events:

            (1)  upon any Person (other than the Company, any trustee or other
                 fiduciary holding securities under any employee benefit plan of
                 the Company or any company owned, directly or indirectly by the
                 stockholders of the Company substantially in the same
                 proportion as their ownership of Common Stock in the Company)
                 becoming the Beneficial Owner, directly or indirectly, of
                 securities of the Company representing 50% or more of the
                 combined voting power of the Company's then outstanding voting
                 securities; or

            (2)  the following individuals cease for any reason to constitute a
                 majority of the number of directors then serving: individuals
                 who, on the Effective Date, constitute the Board and any new
                 director (other

                                       2
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

                 than a director whose initial assumption of office is in
                 connection with an actual or threatened election contest,
                 including but not limited to a consent solicitation, relating
                 to the election of directors of the Company) whose appointment
                 or election by the Board or nomination for election by the
                 Company's stockholders was approved or recommended by a vote of
                 at least two-thirds (2/3) of the directors then still in office
                 who either were directors on the Effective Date or whose
                 appointment, election or nomination for election was previously
                 so approved or recommended;

            (3)  there is consummated a merger or consolidation of the Company
                 or any direct or indirect subsidiary of the Company with any
                 other corporation, other than

                 (i)     a merger or consolidation which would result in the
                         voting securities of the Company outstanding
                         immediately prior thereto continuing to represent
                         (either by remaining outstanding or by being converted
                         into voting securities of the surviving or parent
                         entity) more than 50% of the combined voting power of
                         the voting securities of the Company or such surviving
                         or parent entity outstanding immediately after such
                         merger or consolidation; or

                 (ii)    a merger or consolidation effected to implement a
                         recapitalization of the Company (or similar
                         transaction) in which no Person, directly or
                         indirectly, acquired 50% or more of the combined voting
                         power of the Company's then outstanding securities (not
                         including in the securities beneficially owned by such
                         person any securities acquired directly from the
                         Company or its Affiliates).

            (4)  the stockholders of the Company approve a plan of complete
                 liquidation of the Company or there is consummated an agreement
                 for the sale or disposition by the Company of all or
                 substantially all of the Company's assets (or any transaction
                 having a similar effect), other than a sale or disposition by
                 the Company of all or substantially all of the Company's assets
                 to an entity at least 50% of the combined voting power of the
                 voting securities of which are owned by stockholders of the
                 Company in substantially the same proportions as their
                 ownership of the Company immediately prior to such sale.

       i)   "Code" shall mean the Internal Revenue Code of 1986, as amended from
            time to time, and any regulations promulgated thereunder.

                                       3
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       j)   "Committee" means (a) with respect to the application of this Plan
            to Employees and independent contractors, the committee established
            by the Board to administer the Plan, the composition of which shall
            at all times satisfy the provisions of Section 162(m) of the Code
            and which committee shall consist of two or more Non-Employee
            Directors as defined in Rule 16b-3 under the Exchange Act; provided,
            however, that if and to the extent that no Committee exists which
            has the authority to administer the Plan, the functions of the
            Committee shall be exercised by the Board and all references herein
            to the Committee shall be deemed to be references to the Board; and
            (b) with respect to the application of this Plan to Non-Employee
            Directors, the Board.

       k)   "Company" means SkyAuction.com, Inc., a corporation organized under
            the laws of the State of Delaware, or any successor corporation.

       l)   "Deferred Shares" shall be awards made pursuant to Section 9 of the
            Plan or the right to receive Common Stock in lieu of cash thereof at
            the end of a specified time period.

       m)   "Director" shall mean a member of the Board.

       n)   "Disability" shall mean:

            (1)  any physical or mental condition that would qualify a
                 Participant for a disability benefit under the long-term
                 disability plan maintained by the Company and applicable to him
                 or her;

            (2)  when used in connection with the exercise of an Incentive Stock
                 Option following termination of employment, disability within
                 the meaning of Section 22(e)(3) of the Code, or

            (3)  such other condition as may be determined in the sole
                 discretion of the Committee to constitute Disability.

       o)   "Effective Date" shall mean the date of the Plan's adoption by the
            Board of Directors subject to approval of the Plan by shareholders.

       p)   Employee" shall mean any full-time employee of the Company or its
            Subsidiaries or its Affiliates (including Directors who are
            otherwise employed on a full-time basis by the Company or its
            Subsidiaries).

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

                                       4
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       r)   "Executive Officer" shall have the meaning set forth in Rule 3b-7
            promulgated under the Exchange Act.

       s)   "Fair Market Value" of the Common Stock on a given date shall be
            based upon either:

            (1)  if the Common Stock is listed on a national securities exchange
                 or quoted in an interdealer quotation system, the last sales
                 price or, if unavailable, the average of the closing bid and
                 asked prices per share of the Common Stock on such date (or, if
                 there was no trading or quotation in the Common Stock on such
                 date, on the next preceding date on which there was trading or
                 quotation) as provided by one of such organizations; or

            (2)  if the Common Stock is not listed on a national securities
                 exchange or quoted in an interdealer quotation system, the
                 price will be equal to the Company's fair market value, as
                 determined by the Committee in good faith based upon the best
                 available facts and circumstances at the time.

       t)   "Incentive Stock Option" shall mean an Option that is an "incentive
            stock option" within the meaning of Section 422 of the Code, or any
            successor provision, and that is designated by the Committee as an
            Incentive Stock Option.

       u)   "Issue Date" shall mean the date established by the Company on which
            certificates representing Restricted Stock shall be issued by the
            Company pursuant to the terms of Section 8.6.

       v)   "Non-Employee Director" shall mean a member of the Board who is a
            non-employee director" as defined in Rule 16b-3.

       w)   "Non-Qualified Stock Option" shall mean an Option other than an
            Incentive Stock Option.

       x)   "Option" shall mean an option to purchase a number of shares of
            Stock granted pursuant to Section 7.

       y)   "Other Stock-Based Award" shall mean an award granted pursuant to
            Section 9 hereof.

       z)   "Partial Exercise" shall mean an exercise of an Award for less than
            the full extent permitted at the time of such exercise.

                                       5
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       aa)  "Participant" shall mean:

            (1)  an Employee, independent contractor or Non-Employee Director to
                 whom an Award is granted pursuant to the Plan; and

            (2)  upon the death of an individual described in (1), his or her
                 successors, heirs, executors and administrators, as the case
                 may be.

       bb)  "Person" shall have the meaning set forth in Section 3(a)(9) of the
            Exchange Act, as modified and used in Sections 13(d) and 14(d)
            thereof, except that such term shall not include:

            (1)  the Company,

            (2)  a trustee or other fiduciary holding securities under an
                 employee benefit plan of the Company,

            (3)  an underwriter temporarily holding securities pursuant to an
                 offering of such securities, or

            (4)  a corporation owned, directly or indirectly, by the
                 stockholders of the Company in substantially the same
                 proportions as their ownership of shares of Stock of the
                 Company.

       cc)  "Plan" means the SkyAuction.com, Inc. 2000 Omnibus Plan, as amended
            from time to time.

       dd)  "Reload Option" shall mean a Non-Qualified Stock Option granted
            pursuant to Section 7.3(f).

       ee)  "Restricted Stock" shall mean a share of Stock which is granted
            pursuant to the terms of Section 8 hereof and which is subject to
            the restrictions set forth in Section 8.4.

       ff)  "Rule 16b-3" shall mean Rule 16b-3 promulgated under Section 16(b)
            of the Exchange Act, as amended from time to time.

       gg)  "Securities Act" shall mean the Securities Act of 1933, as amended
            from time to time.

       hh)  "Stock" or "Common Stock" means the common stock, par value $.01 per
            share, of the Company.

                                       6
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       ii)  "Subsidiary" means any corporation in an unbroken chain of
            corporations beginning with the Company if, at the time of granting
            of an Award, each of the corporations (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.

       jj)  "Vesting Date" shall mean the date established by the Committee on
            which Restricted Stock may vest.

                                   SECTION 3
                            Types of Awards Covered

3.1    The Committee may grant Options, Restricted Stock and Other Stock-Based
       Awards in such amounts and with such terms and conditions as the
       Committee shall determine, subject to the provisions of the Plan.

3.2    Each Award granted under the Plan shall be evidenced by an Agreement
       which shall contain such provisions as the Committee may in its sole
       discretion deem necessary or desirable.

3.3    By accepting an Award, a Participant thereby agrees that the Award shall
       be subject to all of the terms and provisions of the Plan and the
       applicable Agreement.

                                   SECTION 4
                                 Administration

4.1    The Plan shall be administered by the Committee. The Committee shall have
       the authority in its sole discretion, subject to and not inconsistent
       with the express provisions of the Plan, to administer the Plan and to
       exercise all the powers and authorities either specifically granted to it
       under the Plan or necessary or advisable in the administration of the
       Plan, including, without limitation, the authority to:

       a)   grant Awards;

       b)   determine the persons to whom and the time or times at which Awards
            shall be granted and the type and number of Awards to be granted, as
            well as the terms and conditions of such Awards;

       c)   determine whether, to what extent, and under what circumstances an
            Award may be settled, canceled, forfeited, exchanged, or
            surrendered;

       d)   construe and interpret the Plan and any Award;

                                       7
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       e)   prescribe, amend and rescind rules and regulations relating to the
            Plan;

       f)   determine the terms and provisions of Agreements;

       g)   modify, extend or renew an Award, subject to Section 14 herein,
            provided, however, that if an Award is modified, extended or renewed
            and thereby deemed to be the issuance of a new Award under the Code
            or the applicable accounting rules, the exercise price of an Award
            may continue to be the original exercise price even if less than the
            Fair Market Value of the Common Stock at the time of such
            modification, extension or renewal; and

       h)   make all other determinations deemed necessary or advisable for the
            administration of the Plan.

4.2    The Committee may, in its absolute discretion, without amendment to the
       Plan:

       a)   accelerate the date on which any Option granted under the Plan
            becomes exercisable, waive or amend the operation of Plan provisions
            respecting exercise after termination of employment or otherwise
            adjust any of the terms of such Option;

       b)   accelerate the Vesting Date or waive any condition imposed hereunder
            with respect to any Restricted Stock; and

       c)   otherwise adjust any of the terms applicable to any Award; PROVIDED,
            HOWEVER, in each case, that in the event of the occurrence of a
            Change in Control, the provisions of Section 12 hereof shall govern
            vesting and exercisability schedule of any Award granted hereunder.

4.3    No member of the Committee shall be liable for any action, omission or
       determination relating to the Plan, and the Company shall indemnify (to
       the extent permitted under Delaware law) and hold harmless each member of
       the Committee and each other Director or Employee of the Company to whom
       any duty or power relating to the administration or interpretation of the
       Plan has been delegated against any cost or expense (including counsel
       fees) or liability (including any sum paid in settlement of a claim with
       the approval of the Committee) arising out of any action, omission or
       determination relating to the Plan, unless, in either case, such action,
       omission or determination was taken or made by such member, Director or
       Employee in bad faith and without reasonable belief that it was in the
       best interests of the Company.

4.4    The Committee may employ such legal counsel and consultants as it may
       deem desirable for the administration of the Plan and may rely upon any
       opinion received from any such counselor consultant and any computation
       received

                                       8
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       from any such consultant. The Committee shall keep minutes of its actions
       under the Plan.

4.5    Any decision, interpretation or other action made or taken in good faith
       by or at the direction of the Company, the Board or the Committee (or any
       of its members) arising out of or in connection with this Plan shall be
       within the absolute discretion of all and each of them, as the case may
       be, and shall be final, binding and conclusive on the Company and all
       employees and Participants and their respective heirs, executors,
       administrators, successors and assigns.

                                   SECTION 5
                                  Eligibility

5.1    Incentive Stock Options shall be granted only to Employees (including
       officers and directors who are also Employees) of the Company, its parent
       or any of its Subsidiaries. All other Awards may be granted to officers,
       independent contractors and Employees of the Company or of any of its
       Subsidiaries or Affiliates and Non-Employee Directors.

5.2    An Employee or Non-Employee Director who has been granted an Award in one
       year shall not necessarily be entitled to be granted Awards in subsequent
       years.

                                   SECTION 6
                      Shares of Stock Subject to the Plan

6.1    The maximum number of shares of Stock reserved for the grant or
       settlement of Awards under the Plan at any given time shall be a number
       representing 11% of the total number of fully diluted shares of the
       Company at such time; provided, however, that the maximum number of
       Shares for which Incentive Stock Options may be granted under this plan
       shall not exceed 80,000 (which number is subject to adjustment as
       provided in Section 6.4 herein). The number of shares of Common Stock
       reserved under the Plan shall not be less than the total number of shares
       granted, whether exercised or unexercised for all Awards under the Plan.

6.2    The number of shares of Stock that may be awarded in respect of Options,
       Restricted Stock and Other Stock-Based Awards to a single individual in
       any given year during the life of the Plan shall not exceed 50,000, which
       number is subject to adjustment as provided in Section 6.4 herein,
       provided, that any such adjustments shall be made in a manner consistent
       with Section 162(m) of the Code.

6.3    Such shares may, in whole or in part, be authorized but unissued shares
       or shares that shall have been or may be reacquired by the Company in the
       open

                                       9
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       market, in private transactions or otherwise. If any shares subject to an
       Award are forfeited, canceled, exchanged or surrendered or if an Award
       otherwise terminates or expires without a distribution of shares to the
       holder of such Award, the shares of Stock with respect to such Award
       shall, to the extent of any such forfeiture, cancellation, exchange,
       surrender, termination or expiration, again be available for Awards under
       the Plan.

6.4    Except as provided in an Award Agreement, in the event that the Committee
       shall determine that any dividend or other distribution (whether in the
       form of cash, Stock, or other property), recapitalization, Stock split,
       reverse Stock split, reorganization, merger, consolidation, spin-off,
       combination, repurchase, or share exchange, or other similar corporate
       transaction or event, affects the Stock such that an adjustment is
       appropriate in order to prevent dilution or enlargement of the rights of
       holders of Awards under the Plan, then the Committee shall make such
       equitable changes or adjustments as it deems necessary or appropriate to
       any or all of:

       a)   the number and kind of shares of Stock or other property (including
            cash) that may thereafter be issued in connection with Awards;

       b)   the number and kind of shares of Stock or other property (including
            cash) issued or issuable in respect of outstanding Awards;

       c)   the exercise price, grant price, or purchase price relating to any
            Award; provided that, with respect to Incentive Stock Options, such
            adjustment shall be made in accordance with Section 424(h) of the
            Code; and

       d)   the individual limitations applicable to Awards.

                                   SECTION 7
                                 Stock Options

7.1    Each Option shall be clearly identified in the applicable Agreement as
       either an Incentive Stock Option or a Non-Qualified Stock Option.

7.2    Each Agreement with respect to an Option shall set forth the exercise
       price per share of Stock payable by the grantee to the Company upon
       exercise of the Option. The exercise price per share of Stock shall be
       determined by the Committee; provided, however, that only in the case of
       Deferred Shares shall an Option have an exercise price per share of Stock
       that is less than the Fair Market Value of a share of Stock on the date
       the Option is granted.

7.3    Term and Exercise of Options

                                       10
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       a)   Unless the applicable Agreement provides otherwise, an Option shall
            become exercisable as to 33 1/3% percent of the Options covered
            thereby on each of the first, second and third anniversaries of the
            date of grant. The Committee shall determine the expiration date of
            each Option; PROVIDED, HOWEVER, that no Option shall be exercisable
            more than 10 years after the date of grant. Unless the applicable
            Agreement provides otherwise and except in the event of a Change in
            Control, no Option shall be exercisable prior to the first
            anniversary of the date of grant.

       b)   An Option may be exercised for all or any portion of the Stock as to
            which it is exercisable, provided that no Partial Exercise of an
            Option shall be for an aggregate exercise price of less than
            $100.00. The Partial Exercise of an Option shall not cause the
            expiration, termination or cancellation of the remaining portion
            thereof.

       c)   An Option shall be exercised by delivering notice to the Company's
            principal office, to the attention of its Secretary. Such notice
            shall be accompanied by the applicable Agreement, shall specify the
            number of shares of Stock with respect to which the Option is being
            exercised and the effective date of the proposed exercise and shall
            be signed by the Participant or other person then having the right
            to exercise the Option. Payment for Stock purchased upon the
            exercise of an Option shall be made on the effective date of such
            exercise by one or a combination of the following means:

            (i)     in cash or by personal check, certified check, bank
                    cashier's check or wire transfer;

            (ii)    subject to the approval of the Committee, in Stock owned by
                    the Participant for at least six months prior to the date of
                    exercise and valued at their Fair Market Value on the
                    effective date of such exercise;

            (iii)   subject to the approval of the Committee, by such other
                    provision as the Committee may from time to time authorize.

       d)   Under Section 421(b) of the Code, each Participant shall notify the
            Company of any disposition of Stock issued pursuant to the exercise
            of an Incentive Stock Option under the circumstances described in
            Section 421(b) of the Code (relating to certain disqualifying
            dispositions), within 10 days of such disposition.

       e)   Certificates for Stock purchased upon the exercise of an Option
            shall be issued in the name of the Participant or other person
            entitled to receive

                                       11
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

            such Stock, and delivered to the Participant or such other person as
            soon as practicable following the effective date on which the Option
            is exercised.

       f)   The Committee shall have the authority to specify, at the time of
            grant or, with respect to Non-Qualified Stock Options, at or after
            the time of grant, that a Participant shall be granted a new
            Non-Qualified Stock Option (a "Reload Option") for a number of
            shares of Stock equal to the number of shares of Stock surrendered
            by the Participant upon exercise of all or a part of an Option in
            the manner described in Section 7.3(c)(ii) above, subject to the
            availability of Stock under the Plan at the time of such exercise;
            provided, however, that no Reload Option shall be granted to a
            Non-Employee Director. Reload Options shall be subject to such
            conditions as may be specified by the Committee in its discretion,
            subject to the terms of the Plan.

7.4    Limitations on Incentive Stock Options

       a)   To the extent that the aggregate Fair Market Value of Stock of the
            Company with respect to which Incentive Stock Options are
            exercisable for the first time by a Participant during any calendar
            year under the Plan and any other option plan of the Company (or any
            Subsidiary or parent) shall exceed $100,000, such Options shall be
            treated as Non-Qualified Stock Options. Such Fair Market Value shall
            be determined as of the date on which each such Incentive Stock
            Option is granted.

       b)   No Incentive Stock Option may be granted to an individual if, at the
            time of the proposed grant, such individual owns (or is attributed
            to own by virtue of the Code) Stock possessing more than ten (10)
            percent of the total combined voting power of all classes of stock
            of the Company or any Subsidiary unless:

            (i)     the exercise price of such Incentive Stock Option is at
                    least 110 percent of the Fair Market Value of a share of
                    Stock at the time such Incentive Stock Option is granted;
                    and

            (ii)    such Incentive Stock Option is not exercisable after the
                    expiration of five years from the date such Incentive Stock
                    Option is granted.

       c)   In addition, if an Employee does not remain employed by the Company,
            any Subsidiary or any parent at all times from the time an Incentive
            Stock Option is granted until 3 months prior to the date of exercise
            thereof (or such other period as required by applicable law), such
            Stock Option shall be treated as a Non-Qualified Stock Option.
            Should any provision of this Plan not be necessary in order for the
            Stock Options to qualify as

                                       12
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

            Incentive Stock Options, or should any additional provisions be
            required, the Committee may amend this Plan accordingly, without the
            necessity of obtaining the approval of the stockholders of the
            Company.

7.5    Effect of Termination of Employment

       a)   Unless the applicable Agreement provides otherwise, in the event
            that the employment, directorship or consultancy (together,
            hereinafter referred to as "employment") of a Participant with the
            Company shall terminate for any reason other than Cause, Disability
            or death:

            (i)     Options granted to such Participant, to the extent that they
                    are exercisable at the time of such termination, shall
                    remain exercisable until the date that is 90 days after such
                    termination, on which date they shall expire; and

            (ii)    Options granted to such Participant, to the extent that they
                    were not exercisable at the time of such termination, shall
                    expire at the close of business on the date of such
                    termination. The 90 day period described in this Section
                    7.5(a)(i) shall be extended to one year from such
                    termination, in the event of the Participant's death during
                    such 90 day period. Notwithstanding the foregoing, no Option
                    shall be exercisable after the expiration of its term.

       b)   Unless the applicable Agreement provides otherwise, in the event
            that the employment of a Participant with the Company shall
            terminate on account of the Disability or death of the Participant:

            (i)     Options granted to such Participant, to the extent that they
                    were exercisable at the time of such termination, shall
                    remain exercisable until the first anniversary of such
                    termination, on which date they shall expire; and

            (ii)    Options granted to such Participant, to the extent that they
                    were not exercisable at the time of such termination, shall
                    expire at the close of business on the date of such
                    termination; provided, however, that no Option shall be
                    exercisable after the expiration of its term.

       c)   In the event of the termination of a Participant's employment for
            Cause, all outstanding Options granted to such Participant shall
            expire as of the commencement of business on the date of such
            termination.

                                       13
<PAGE>

SkyAuction.com Inc.
2000 Omnibus Plan

                                   SECTION 8
                                Restricted Stock

8.1    At the time of the grant of Restricted Stock, the Committee shall
       establish an Issue Date or Issue Dates, a Vesting Date or Vesting Dates
       and the purchase price (if any) with respect to such shares of
       Restricted Stock. The Committee may divide such shares of Restricted
       Stock into classes and assign a different Issue Date and/or Vesting Date
       for each class. The purchase price for shares of Restricted Stock may be
       zero to the extent permitted by applicable law, and, to the extent not so
       permitted, such purchase price may not be less than par value. If the
       grantee is employed by the Company on an Issue Date (which may be the
       date of grant), the specified number of shares of Restricted Stock shall
       be issued in accordance with the provisions of Section 8.6. Provided that
       all conditions to the vesting of Restricted Stock imposed pursuant to
       Section 8.2 are satisfied, and except as provided in Section 8.8, upon
       the occurrence of the Vesting Date with respect to Restricted Stock, such
       Restricted Stock shall vest and the restrictions of Section 8.4 shall
       lapse.

8.2    At the time of the grant of Restricted Stock, the Committee may impose
       such restrictions or conditions to the vesting of such Restricted Stock
       as it, in its absolute discretion, deems appropriate.

8.3    If any Participant shall, in connection with the acquisition of Stock
       under the Plan, make the election permitted under Section 83(b) of the
       Code (i.e., an election to include in gross income in the year of
       transfer the amounts specified in Section 83(b)), such Participant shall
       notify the Company of such election within 10 days of filing notice of
       the election with the Internal Revenue Service, in addition to any filing
       and a notification required pursuant to regulation issued under the
       authority of Section 83(b) of the Code.

8.4    Prior to the vesting of any Restricted Stock, no transfer of a
       Participant's rights with respect to such Restricted Stock, whether
       voluntary or involuntary, by operation of law or otherwise, shall be
       permitted. Immediately upon any attempt to transfer such rights, such
       Restricted Stock, and all of the rights related thereto, shall be
       forfeited by the Participant.

8.5    The committee in its discretion may require that any dividends or
       distributions paid on Restricted Stock be held in escrow until all
       restrictions on such Restricted Stock has lapsed.

8.6    Issuance of Certificates

       a)   Reasonably promptly after the Issue Date with respect to Restricted
            Stock, the Company shall cause to be issued a certificate,
            registered in the name of the Participant to whom such shares of
            Restricted Stock were granted, evidencing such shares of Restricted
            Stock; provided that the Company shall not cause such a certificate
            to be issued unless it has received a power of attorney duly
            endorsed in blank with respect to such

                                       14
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

            shares of Restricted Stock. Each such certificate shall bear the
            following legend:

            THE TRANSFERABILITY OF THIS CERTIFICATE AND THE STOCK REPRESENTED
            HEREBY ARE SUBJECT TO THE RESTRICTIONS, TERMS AND CONDITIONS
            (INCLUDING FORFEITURE PROVISIONS AND RESTRICTIONS AGAINST TRANSFER)
            CONTAINED IN THE SKYAUCTION.COM, INC. 2000 OMNIBUS PLAN AND AN
            AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER OF SUCH STOCK
            AND SKYAUCTION.COM, INC. A COPY OF SUCH OMNIBUS PLAN AND AGREEMENT
            IS ON FILE WITH THE SECRETARY OF THE COMPANY.

            Such legend shall not be removed until such Stock vests pursuant to
            the terms hereof.

       b)   Each certificate issued pursuant to this Section 8.6, together with
            the powers relating to the Restricted Stock evidenced by such
            certificate, shall be held by the Company unless the Committee
            determines otherwise.

8.7    Upon the vesting of any Restricted Stock pursuant to the terms hereof,
       the restrictions of Section 8.4 shall lapse with respect to such
       Restricted Stock. Reasonably promptly after any Restricted Stock vests,
       the Company shall cause to be delivered to the Participant to whom such
       shares of Restricted Stock were granted a certificate evidencing such
       Stock, free of the legend set forth in Section 8.6.

8.8    Subject to such other provision as the Committee may set forth in the
       applicable Agreement, and to the Committee's amendment authority pursuant
       to Section 4, upon the termination of a Participant's employment for any
       reason other than Cause, any and all Stock to which restrictions on
       transferability apply shall be immediately forfeited by the Participant
       and transferred to, and reacquired by, the Company; provided that if the
       Committee, in its sole discretion, shall within thirty (30) days after
       such termination of employment notify the Participant in writing of its
       decision not to terminate the Participant's rights in such shares of
       Stock, then the Participant shall continue to be the owner of such shares
       of Stock subject to such continuing restrictions as the Committee may
       prescribe in such notice.

       In the event of a forfeiture of Stock pursuant to this section, the
       Company shall repay to the Participant (or the Participant's estate) any
       amount paid by the Participant for such shares of Stock. In the event
       that the Company requires a return of Stock, it shall also have the right
       to require the return of all dividends or distributions paid on such
       Stock, whether by termination of any escrow arrangement under which such
       dividends or distributions are held or otherwise.

                                       15
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       In the event of the termination of a Participant's employment for Cause,
       all shares of Restricted Stock granted to such Participant which have not
       vested as of the date of such termination shall immediately be returned
       to the Company, together with any dividends or distributions paid on such
       shares of Stock, in return for which the Company shall repay to the
       Participant any amount paid by the Participant for such shares of Stock.

                                   SECTION 9
                       Other Stock-Based Incentive Awards

9.1    Other forms of Awards valued in whole or in part by reference to, or
       otherwise based on, shares of Stock ("Other Stock-Based Awards") may be
       granted either alone or in addition to other Awards under the Plan. The
       Committee may also grant Participants the right to receive Deferred
       Shares which are stock-based incentive grants in lieu of a cash deferral
       of bonuses.

9.2    Subject to the provisions of the Plan, the Committee shall have sole and
       complete authority to determine the persons to whom and the time or times
       at which such Other Stock-Based Awards shall be granted, the number of
       shares of Stock to be granted pursuant to such Other Stock-Based Awards
       and all other conditions of such Other Stock-Based Awards.

                                   SECTION 10
                     Rights in Event of Death or Disability

10.1   Upon the death of a Participant, outstanding Awards granted to such
       Participant may be exercised only by the executor or administrator of the
       Participant's estate or by a person who shall have acquired the right to
       such exercise by will or by the laws of descent and distribution. No
       transfer of an Award by will or the laws of descent and distribution
       shall be effective to bind the Company unless the Committee shall have
       been furnished with

       a)   written notice thereof and with a copy of the will and/or such
            evidence as the Committee may deem necessary to establish the
            validity of the transfer and

       b)   an agreement by the transferee to comply with all the terms and
            conditions of the Award that are or would have been applicable to
            the Participant and to be bound by the acknowledgments made by the
            Participant in connection with the grant of the Award.

10.2   During a Participant's lifetime, the Committee may permit the transfer,
       assignment or other encumbrance of an outstanding Option unless such
       Option is an Incentive Stock Option and the Committee and the Participant
       intend that it shall retain such status.

                                       16
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

10.3   Subject to any conditions as the Committee may prescribe, a Participant
       may, upon providing written notice to the Secretary of the Company, elect
       to transfer any or all Options granted to such Participant pursuant to
       the Plan to members of his or her immediate family, including, but not
       limited to, children, grandchildren and spouse or to trusts for the
       benefit of such immediate family members or to partnerships in which such
       family members are the only partners; provided, however, that no such
       transfer by any Participant may be made in exchange for consideration.

10.4   A Participant may file with the Committee a written designation of a
       beneficiary on such form as may be prescribed by the Committee and may,
       from time to time, amend or revoke such designation. If no designated
       beneficiary survives the Participant, the executor or administrator of
       the Participant's estate shall be deemed to be the grantee's beneficiary.

                                   SECTION 11
                                Tax Withholding

11.1   Whenever shares of Stock are to be delivered pursuant to an Award, the
       Company shall have the right to require the Participant to remit to the
       Company in cash an amount sufficient to satisfy any federal, state and
       local withholding tax requirements related thereto.

11.2   With the approval of the Committee, a Participant may satisfy the
       foregoing requirement by electing to have the Company withhold from
       delivery shares of Stock having a value equal to the amount of tax to be
       withheld. Such shares of Stock shall be valued at their Fair Market Value
       on the date of which the amount of tax to be withheld is determined (the
       "Tax Date"). Fractional shares of Stock amounts shall be settled in cash.
       Such a withholding election may be made with respect to all or any
       portion of the Stock to be delivered pursuant to an Award.

                                   SECTION 12
                               Acquisition events

12.1   In the event of a merger or consolidation in which the Company is not the
       surviving entity or in the event of any transaction that results in the
       acquisition of all or substantially all of the Company's outstanding
       Common Stock and any other classes of stock convertible into Common Stock
       or all or substantially all of its assets by a single person or entity or
       by a group of persons and/or entities acting in concert, or in the event
       of the sale or transfer of all or substantially all of the Company's
       assets (all of the foregoing being referred to as "Acquisition Events"),
       then the Committee may, in its sole discretion (i) require that all
       shares subject to outstanding Awards or received by any person upon the
       exercise of any Awards (including, without limitation, pursuant to clause
       (iii) herein) be subject to a "drag along" in any sale of Common Stock or
       other securities of the

                                       17
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       Company on such terms and conditions as the Committee shall determine
       and/or (ii) require that all shares subject to outstanding Awards or
       received by any person upon the exercise of any Awards (including,
       without limitation, pursuant to clause (iii) herein) be subject to a call
       right by the Company to purchase such shares at their fair market value
       as the Committee shall determine and/or (iii) terminate all outstanding
       Stock Options, effective as of the date of the Acquisition Event, by
       delivering notice of termination to each person holding any Awards under
       this Plan at least 20 days prior to the date of consummation of the
       Acquisition Event, in which case during the period from the date on which
       such notice of termination is delivered to the consummation of the
       Acquisition Event, each such person shall have the right to exercise his
       or her Stock Options (to the extent then vested), but any such exercise
       shall be contingent upon and subject to the occurrence of the Acquisition
       Event, and provided that, if the Acquisition Event does not take place
       within a specified period after giving such notice for any reason
       whatsoever, the notice and exercise pursuant thereto shall be null and
       void.

12.2   Upon dissolution or liquidation of the Company, all Options and other
       Awards granted under this Plan shall terminate, but each holder of an
       Option shall have the right, immediately prior to such dissolution or
       liquidation, to exercise his or her Option to the extent then
       exercisable.

12.3   If the Company and the other party to a transaction constituting a Change
       in Control agree that such transaction shall be treated as a "pooling of
       interests" for financial reporting purposes, and if the transaction is in
       fact so treated, then any provisions herein or in the terms of any Award
       providing for the acceleration of exercisability, vesting or lapse of the
       applicable restriction period shall not occur to the extent that the
       Company's independent public accountants determine in good faith that
       such acceleration would preclude "pooling of interests" accounting.

                                   SECTION 13
                               Securities Matters

13.1   The Company shall be under no obligation to effect the registration
       pursuant to the Securities Act of any interests in the Plan or any Stock
       to be issued hereunder or to effect similar compliance under any state
       laws.

13.2   Notwithstanding anything herein to the contrary, the Company shall not be
       obligated to cause to be issued or delivered any certificates evidencing
       Stock pursuant to the Plan unless and until the Company is advised by its
       counsel that the issuance and delivery of such certificates is in
       compliance with all applicable laws, regulations of governmental
       authority and the requirements of any

                                       18
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       securities exchange on which shares of Stock are traded. The Committee
       may require, as a condition of the issuance and delivery of certificates
       evidencing shares of Stock pursuant to the terms hereof, that the
       recipient of such shares of Stock make such agreements and
       representations, and that such certificates bear such legends, as the
       Committee, in its sole discretion, deems necessary or desirable.

13.3   The transfer of any shares of Stock hereunder shall be effective only at
       such time as counsel to the Company shall have determined that the
       issuance and delivery of such shares of Stock is in compliance with all
       applicable laws, regulations of governmental authority, the requirements
       of any securities exchange on which shares of Stock are traded. The
       Committee may, in its sole discretion, defer the effectiveness of any
       transfer of Stock hereunder in order to allow the issuance of such Stock
       to be made pursuant to registration or an exemption from registration or
       other methods for compliance available under federal or state securities
       laws. The Committee shall inform the Participant in writing of its
       decision to defer the effectiveness of a transfer. During the period of
       such deferral in connection with the exercise of an Option, the
       Participant may, by written notice, withdraw such exercise and obtain the
       refund of any amount paid with respect thereto.

13.4   All elections and transactions under this Plan by persons subject to
       Section 16 of the Exchange Act involving shares of Common Stock are
       intended to comply with any applicable exempting condition under Rule
       16b-3. The Committee may establish and adopt written administrative
       guidelines, designed to facilitate compliance with Section 16(b) of the
       Exchange Act, as it may deem necessary or proper for the administration
       and operation of this Plan and the transaction of business thereunder.

13.5   Except as the Company or Committee shall otherwise determine, this Plan
       is intended to comply with Section 4(2) or Rule 701 under the Securities
       Act, and any provisions inconsistent with such Section or Rule of the
       Securities Act shall be inoperative and shall not affect the validity of
       the Plan.

                                   SECTION 14
                            Amendment or Termination

14.1   The Board may, at any time, suspend or terminate the Plan or revise or
       amend it in any respect whatsoever; provided, however, that stockholder
       approval shall be required (in accordance with the laws of the State of
       Delaware) if and to the extent the Board determines that such approval is
       appropriate for purposes of satisfying Rule 16b-3, Section 162(m) or 422
       of the Code (as applicable) or is otherwise required by law or applicable
       stock exchange requirements.

                                       19
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

14.2   Awards may be granted under the Plan prior to the receipt of such
       approval but each such grant shall be subject in its entirety to such
       approval and no award may be exercised, vested or otherwise satisfied
       prior to the receipt of such approval. Nothing herein shall restrict the
       Committee's ability to exercise its discretionary authority pursuant to
       Section 4, which discretion may be exercised without amendment to the
       Plan. No action hereunder may, without the consent of a Participant,
       reduce the Participant's rights under any outstanding Award.

                                   SECTION 15
                  Company Call Rights; Rights of First Refusal

15.1   In the event of termination for Cause, the Company may repurchase from
       the Participant any shares of Common Stock previously acquired by the
       Participant through the grant of an Option or an award of Restricted
       Stock under this Plan at a repurchase price equal to the lesser of (A)
       the original purchase price or exercise price (as applicable), if any, or
       (B) Fair Market Value as of the date of termination.

       In the event of a termination for any reason other than for Cause, the
       Company may at any time within 90 days after a Participant incurs a
       termination or acquires shares of Common Stock upon the exercise of an
       Option following his termination for any reason other than for Cause:
       (i) repurchase from the Participant each outstanding vested Option
       based on the difference between the exercise price of a share of Common
       Stock relating to such Option and the Fair Market Value of a share of
       Common Stock on the date of termination and (ii) repurchase from the
       Participant any shares of Common Stock previously acquired by the
       Participant through the exercise of an Option under this Plan at a
       repurchase price equal to Fair Market Value as of the date of
       termination.

       In the event of a termination for any reason other than for Cause, the
       Company may at any time within 90 days after a Participant incurs a
       termination other than for Cause repurchase from the Participant any
       shares of Common Stock previously acquired by the Participant pursuant to
       an award of Restricted Stock under this Plan at a repurchase price equal
       to Fair Market Value as of the date of termination.

15.2   No Participant shall, directly or indirectly, transfer any shares of
       Common Stock acquired by the Participant (or his estate or legal
       representative) through the exercise of an Option under this Plan or
       pursuant to an award of Restricted Stock, unless in each such instance
       the Participant (or his estate or legal representative) shall have first
       offered the Common Stock proposed to be transferred pursuant to a bona
       fide offer to a third party, first, to the Company and second, to holders
       of Common and Preferred Stock of the Company, pro-rata according to
       their ownership of the Company at such time (on an as converted basis).
       The right of first refusal must be exercised by the Company

                                       20
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

       and any stockholders of the Company by delivering to the Participant (or
       his estate or legal representative) written notice of such exercise
       within 20 business days of the Company's receipt of written notification
       (which the Company shall forward to all of its stockholders within five
       days of its receipt) of the proposed sale. Upon the exercise of a right
       of first refusal, the Common Stock proposed to be sold shall be purchased
       by the Company and/or any stockholders exercising their rights pursuant
       to this Section 15.2 at the price per share offered to be paid by the
       prospective transferee, subject to Section 15.1 above in the case of a
       Participant's termination. The notice of exercise of the right of first
       refusal shall specify the date and location for the closing of such
       purchase. In the event the Company and its stockholders do not exercise
       their rights pursuant to this Section 15.2 with respect to all shares
       proposed to be sold by the Participant, the Participant shall have six
       months to sell such remaining shares to such bona fide third party
       pursuant to terms and conditions not more favorable than those pursuant
       to which such shares were offered to the Company and its stockholders.
       Any shares proposed to be sold after such six month period shall be
       subject to the provisions of this Section 15.2.

15.3   Notwithstanding the foregoing, the Company shall cease to have rights
       pursuant to this Section 15 following an initial public offering of the
       Common Stock of the Company.

                                   SECTION 16
                                 Unfunded Plan

16.1   This Plan is intended to constitute an "unfunded" plan for incentive and
       deferred compensation. With respect to any payments as to which a
       Participant has a fixed and vested interest but which are not yet made to
       a Participant by the Company, nothing contained herein shall give any
       such Participant any rights that are greater than those of a general
       creditor of the Company.

                                   SECTION 17
                               General Provisions

17.1   No Awards may be exercised by a Grantee if such exercise, and the receipt
       of cash or stock thereunder, would be, in the opinion of counsel selected
       by the Company, contrary to law or the regulations of any duly
       constituted authority having jurisdiction over the Plan.

17.2   A bona fide leave of absence approved by a duly constituted officer of
       the Company shall not be considered interruption or termination of
       service of any Participant for any purposes of the Plan or Awards granted
       thereunder, except that no Awards may be granted to an Employee while he
       or she is on a bona fide leave of absence.

                                       21
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

17.3   No person shall have any rights as a stockholder with respect to any
       shares of Stock covered by or relating to any Award until the date of
       issuance of a certificate with respect to such shares of Stock. Except as
       otherwise expressly provided in Section 6.4, no adjustment to any Award
       shall be made for dividends or other rights prior to the date such
       certificate is issued.

17.4   Nothing contained in the Plan or any Agreement shall confer upon any
       Participant any right with respect to the continuation of employment,
       consultancy or directorship by the Company or any Affiliate or interfere
       in any way with the right of the Company or any Affiliate, subject to the
       terms of any separate agreement to the contrary, at any time to terminate
       such employment, consultancy or directorship or to increase or decrease
       the compensation of the Participant. No person shall have any claim or
       right to receive an Award hereunder. The Committee's granting of an Award
       to a participant at any time shall neither require the Committee to grant
       any other Award to such Participant or other person at any time or
       preclude the Committee from making subsequent grants to such Participant
       or any other person.

17.5   In addition to the remedies of the Company elsewhere provided for herein,
       failure by a Participant (or beneficiary) to comply with any of the terms
       and conditions of the Plan or the applicable Agreement, unless such
       failure is remedied by such Participant (or beneficiary) within ten days
       after notice of such failure by the Committee, shall be grounds for the
       cancellation and forfeiture of such Award, in whole or in part, as the
       Committee, in its absolute discretion, may determine.

17.6   Any Award agreement may provide that stock issued upon exercise of any
       Awards may be subject to such restrictions, including, without
       limitation, restrictions as to transferability and restrictions
       constituting substantial risks of forfeiture as the Committee may
       determine at the time such Award is granted.

17.7   As a condition to the receipt of shares of Common Stock pursuant to an
       Option under this Plan, to the extent required by the Committee, the
       Participant shall execute and deliver a stockholder's agreement or such
       other documentation which shall set forth certain restrictions on
       transferability of the shares of Common Stock acquired upon exercise or
       purchase, a right of first refusal of the Company with respect to shares,
       the right of the Company to purchase Common Stock in accordance with this
       Plan and such other terms as the Board or Committee shall from time to
       time establish. Such stockholder's agreement shall apply to all Common
       Stock acquired under the Plan.

17.8   This Plan shall be governed and construed in accordance with the laws of
       the State of Delaware (regardless of the law that might otherwise govern
       under applicable Delaware principles of conflict of laws).

                                       22
<PAGE>

SkyAuction.com, Inc.
2000 Omnibus Plan

                                   SECTION 18
                              Plan Effective Date

18.1   The Plan shall become effective on the date of its adoption by the Board
       of Directors of the Company subject to approval of the Plan by the
       holders of a majority of the outstanding voting shares of the Company
       within twelve (12) months after the date of the Plan's adoption by said
       Board of Directors. In the event of the failure to obtain such
       shareholder approval, the Plan and any Awards granted thereunder, shall
       be null and void and the Company shall have no liability thereunder.

18.2   No Award granted under the Plan shall be exercisable until such
       shareholder approval has been obtained.

                                   SECTION 19
                                Plan Termination

19.1   No Award may be granted under the Plan on or after the date which is ten
       years following the effective date specified in Section 18, but Awards
       previously granted may be exercised in accordance with their terms.

                                       23<PAGE>

                       [SkyAuction.com, Inc. Letterhead]

                           PERSONAL AND CONFIDENTIAL
                           -------------------------

                             As of January 1, 2000

Mr. Michael N. Hering
547 Highland Avenue
Westfield, N.J. 07090

Dear Michael:

         This is to confirm our mutual understanding with respect to your
employment by SkyAuction.com, Inc. (the "Company"), as follows:

         1. Employment: Authority. The Company hereby agrees to employ you, and
you hereby agree to be employed by the Company, on the terms and conditions set
forth in this letter. You will serve the Company as its Chief Executive Officer
with all the responsibility and authority customarily associated with such
position. You will serve as a member of the Company's Executive Committee. You
also agree to perform such duties and services, and to have such other
responsibilities, as the Company's Board of Directors may, from time to time,
assign to you consistent with your position. You hereby represent and warrant to
the Company that you are not now under any contractual obligation to any third
party that is inconsistent with the terms of this letter or that would prevent,
limit or impair in any way your performance of your duties under this letter.

         2. Compensation. As full compensation for all services provided and
duties performed by you (inclusive of your services as an officer of the Company
and member of its Executive Committee) during your employment by the Company
under the terms of this letter, you will be entitled to receive:

         a. Base Salary. A base salary (your "Base Salary") at the rate of
$300,000 per annum, effective as of the date hereof, payable semi-monthly in
accordance with the Company's normal payroll practices; provided, that the rate
of Base Salary is subject to annual merit increases, based on individual
performance and the Company's annual compensation guidelines as determined by
the compensation committee of the Company's Board of Directors (the
"Compensation Committee"); provided further, that upon the completion by the
Company of an initial public offering of its Common Stock (or any other equity
securities) (an "IPO") your Base Salary shall be increased to no less than
$450,000.

         b. Annual Bonus. An annual bonus (your "Annual Bonus") determined by
the Compensation Committee. You shall participate in the compensation package,
including, without limitation, any bonus plan(s), offered to senior executives
of the Company as approved by the Compensation Committee; provided, however,
that your target award (as determined by the Compensation Committee) for the
purposes of your Annual Bonus shall be 50% of your Base Salary for such year. If
the scheduled term (as defined in Section 4 below) does not expire at the end of
the Company's fiscal year, your Annual Bonus for the year

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 2

in which the scheduled term expires shall be an amount equal to the product of
(x) the Annual Bonus that you would have received had the scheduled term expired
at the end of such year and (y) a fraction, the numerator of which is the number
of months from the beginning of such year until the actual expiration of the
scheduled term, and the denominator of which is 12.

         c. Benefits. During your employment hereunder, you shall be intitled to
all benefits generally available to the Company's senior executives and for
which you may qualify, inclusive of hospitalization and major medical insurance,
health and disability insurance, pension plans or benefits, any supplemental
retirement plans or benefits and any perquisites that are generally made
available to executives of the Company. The benefits and perquisites to which
you are entitled pursuant to this paragraph are sometimes referred to herein as
your "Benefits".

         d. Certain Changes. While the Company retains the right to change,
eliminate, discontinue or substitute any plan, program or benefit, or any
provision thereof, the Company agrees with you that upon any such change,
elimination, discontinuation or substitution there will be a replacement plan,
program or benefit under the terms of which you will have no less of an
opportunity to receive an equal or greater benefit than as currently provided;
provided, however, that no such change, elimination, discontinuation or
substitution will (x) reduce your Base Salary or Annual Bonus or (y) eliminate
or reduce any sums that have been granted to you or that you are otherwise
entitled to receive (but have not yet been paid) on the date that any such
change, elimination, discontinuation or substitution becomes effective.

         e. Tax Reporting. All payments made to you pursuant to this letter
(whether specified in this Section 2 or not) are subject to all applicable tax
withholding by the Company. In addition, you acknowledge and agree that all
payments to be made to you as Base Salary, as Annual Bonus or otherwise under
this letter shall, to the extent required by law, be reported for all tax
purposes as compensation for services rendered, and you shall not state or claim
any different position in any tax return or report (or any audit thereof).

         3. Expenses. During your employment hereunder, the Company will
reimburse you for your travel and other expenses incident to your providing
services and performing duties under this letter, in conformity with the
Company's regular policies from time to time in effect regarding reimbursement
of expenses, with the proviso that such reimbursement will only be made upon
presentation of expense vouchers in such detail as may from time to time be
necessary for the Company to comply with all applicable tax and accounting
requirements.

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 3

         4. Term

         a. The term of your employment under this letter commenced on January
1, 2000 and shall continue until December 31, 2002 or such other date as may be
determined in accordance with Section 4.b. below (the "scheduled term"), unless
earlier terminated by reason of death, Disability (as defined below),
termination by you after the occurrence of a Change in Opportunity (as defined
below) or otherwise or termination by the Company (with or without Cause (as
defined below))(in each case, and subject to any provisions in this Section 4 or
in Section 5, upon no less than 30 days' prior written notice). Any decision to
terminate your employment (with or without Cause) or not to extend the term of
your employment as described in Section 4.b. below must be and shall not be
valid unless adopted by an affirmative vote of the majority of the members of
the Company's Board of Directors (which majority must include the chairman of
the Board of Directors (the "Chairman") so long as the Chairman is Len
Schutzman).

         b. At any time no more than six months and no less than three months
prior to the termination of the then current scheduled term (as such may have
been extended) you or the Company may notify each other, in writing, of a lack
of intention to extend the term of your employment by the Company under this
letter beyond the then current scheduled term, in which case your employment by
the Company under this letter shall end upon the expiration of the scheduled
term. In the absence of such notice, at the end of the then current scheduled
term, the scheduled term under this letter will be automatically extended by
twelve months.

         5. Consequence of Termination.

         a. Death or Disability. Anything herein to the contrary
notwithstanding, if your employment under this letter is terminated early (i.e.,
before expiration of the scheduled term) by reason of your death or your
Disability (as defined below), you (or your estate, as the case may be) shall be
entitled to receive your Base Salary and all other amounts owing to you in
respect of your services under this letter through the date of such termination
(including, without limitation, your Annual Bonus for the calendar year in which
such termination occurs, pro-rated to reflect the portion of such year elapsed
through the date of such termination (and based on target amounts (the pro-rata
portion of which shall be determined by the Compensation Committee), not actual
performance)) and any Benefits that by their terms continue thereafter), but the
Company shall have no further liability or obligation whatsoever to you
hereunder.

         b. Termination without Cause. If your employment under this letter is
terminated early (i.e., before expiration of the scheduled term) by the Company
without Cause or by you voluntarily within 90 days after the occurrence of a
Change in Opportunity (as defined below), you shall be entitled, in lieu of any
other or further compensation of any kind from the Company (other than your
vested rights in any retirement, life insurance, disability insurance or other
pension or benefit plan of the Company), to receive severance (your "Severance")
consisting of:

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 4

         (1) Continued payment of your Base Salary (at the rate in effect
hereunder immediately prior to the termination) through the expiration of the
scheduled term, payable as and when it would otherwise have been paid had you
continued in the Company's employ;

         (2) Continued payment of your Annual Bonus in an annual amount equal to
your maximum Annual Bonus (i.e., 50% of your Base Salary as in effect
immediately prior to your termination) through the expiration of the scheduled
term, such amount to be payable within 30 days after the end of each year as to
which such Annual Bonus is determined, with payment for the final period (i.e.,
the period ending with the expiration of the scheduled term, to be made in
accordance with the pro ration provision in the last sentence of Section 2.b.
hereof);

         (3) Your Benefits (to the extent permitted by applicable law and the
terms of any applicable plans, in each case as if you continued as an active
employee or, if the Company is not able to provide any such Benefit to you, the
economic equivalent thereof) until the expiration of the scheduled term;

         (4) You shall retain all options to purchase stock of the Company which
you shall hold at such time, all of which shall be or shall become vested as of
the date of termination of your employment. Such options may be exercised by you
at any time until the second anniversary of the termination of your employment
with the Company; and

         (5) Continued office and secretarial support through the expiration of
the scheduled term or such time as you obtain other employment, whichever occurs
first.

In the event that the termination of your employment pursuant to this Section
5.b. is initiated by the Company, your employment shall not be deemed to have
been terminated pursuant to this Section 5.b. unless there shall have been
delivered to you a copy of a notice of termination from the Company (no less
than 30 days prior to the effective date of such termination, or, in the event
of non-extension of the scheduled term as provided in Section 4.b. as described
therein) providing, in reasonable detail, a description of the reasons therefor,
and unless you have had an opportunity, together with your counsel, to be heard
before the Company's Board of Directors.

You shall not be required to mitigate the amount of Severance due to you
hereunder by seeking employment or otherwise, nor shall any amounts received by
you from other employment or otherwise by you offset in any manner the Company's
obligation to provide such Severance.

         c. Termination with Cause. If your employment under this letter is
terminated by the Company with Cause, the Company shall (without limiting any
right or remedy to which it may be entitled) be obligated to continue to pay you
your Base Salary, Annual Bonus (except that you shall be entitled to receive
your Annual Bonus for the year in which the effective date of your termination
occurs on a pro rata basis (as such is determined by the Compensation
Committee), based on actual performance), Benefits or any other amounts

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 5

provided herein until the effective date of such termination, but shall have no
further liability or obligation whatsoever to you hereunder; provided, that
nothing in this provision shall be interpreted so as to limit any Benefits to
which you or your dependents or estate are entitled according to the specific
terms of any applicable employee benefit plan, program or practice after such
termination of your employment. In addition, in the event of termination of your
employment pursuant to this Section 5.c., the Company shall be entitled to
repurchase from you, at a cash price equal to the Termination Price, 75% of the
issued and outstanding shares of the Company owned by you as of the date of such
termination (but excluding up to ____ shares subject to call options to certain
individuals, to the extent such call options are in effect on the date of
termination). If the Company wishes to effect such repurchase it shall notify
you of its intention within 30 days of the termination of your employment and
such repurchase shall be effected within 60 days of such termination.

         d. Termination by You. If your employment under this letter is
terminated early by you (other than voluntarily within 90 days after the
occurrence of a Change in Opportunity (as defined below) in accordance with
Section 5.b. of this letter), the Company shall (without limiting any right or
remedy to which it may be entitled) be obligated to continue to pay you your
Base Salary, Benefits and any other amounts provided herein until the effective
date of such termination, but shall have no further liability or obligation
whatsoever to you hereunder; provided, that nothing in this provision shall be
interpreted so as to limit any Benefits to which you or your dependents or
estate are entitled according to the specific terms of any applicable employee
benefit plan, program or practice after such termination of your employment. In
addition, in the event of termination of your employment pursuant to this
Section 5.d. prior to December 31, 2001, the Company shall be entitled to
repurchase from you, at a cash price equal to the Termination Price, 75% of the
issued and outstanding shares of the Company owned by you as of the date of such
termination (but excluding up to ___shares subject to call options to certain
individuals, to the extent such call options are in effect on the date of
termination). If the Company wishes to effect such repurchase it shall notify
you of its intention within 30 days of the termination of your employment and
such repurchase shall be effected within 60 days of such termination.

         6. Certain Definitions. For purposes of this letter, the following
definitions shall apply:

                  "Cause" means: (i) willful and repeated failure or refusal to
         perform your duties; (ii) embezzlement or similar criminal
         misappropriation of Company funds; (iii) conviction of a crime
         constituting a felony that will have a material adverse effect on the
         Company; or (iv) a material breach of any term of this letter;
         provided, in each case, that your employment shall not be deemed to
         have been terminated for Cause unless (x) you shall have been provided
         a notice from the Company's Board of Directors no less than 30 days
         prior to the effective date of such termination stating that any event
         that had occurred or, in the event of clause (iii) above, that will
         occur, constitutes Cause and that the Board of Directors intends to
         terminate your employment for Cause pursuant to Section 5.c hereof and
         describing in reasonable detail, the reasons therefor, and (y) you have
         had both an opportunity to cure such Cause and, together with your
         counsel, to be heard before the Company's Board of Directors during
         such 30-day period.

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 6

                  "Change in Opportunity" means, without your express written
         consent, any of the following:

                  (i) the assignment to you of any duties materially
         inconsistent with your position, authority, duties or responsibilities
         as contemplated hereby, or any other action by the Company that results
         in a material diminution of such position, authority, duties or
         responsibilities;

                  (ii) the Company's requirement that you move your personal
         residence or perform your principal executive functions outside of
         Manhattan;

                  (iii) the Company's requirement that you report to an
         executive other than the Chairman or the Company's Board of Directors;
         or

                  (iv) the failure of the Company to provide you with a total
         compensation package substantially equivalent to that set forth in this
         letter or any other material breach by the Company of the terms herein;

         provided, in each case, that you shall not be deemed to have terminated
         your employment for "Change of Opportunity" unless there shall have
         been delivered to the Company a copy of a notice of termination from
         you (no less than 30 days prior to the effective date of such
         termination) providing, in reasonable detail, a description of the
         reasons therefor, and unless the Company shall have had an opportunity
         to cure any events causing such Change of Opportunity.

                  "Disability" means your inability to perform your duties in
         any material manner by reason of physical or mental disability for a
         period of six consecutive months, or for a period of more than nine
         months in the aggregate in any twelve-month period.

                  "Termination Price" means the number of shares you hold at the
         time of termination divided by the number of shares you hold as of the
         date of this agreement, not including shares subject to certain call
         option agreements in effect at the date hereof, x $1,000,000.

         7 .Gross Up. The Company shall provide employee with gross-up payments,
as described in Exhibit A, attached hereto.

         8. Non Competition; Non Solicitation. You agree that, without the prior
express written consent of the Company's Board of Directors, you shall not,
during your employment hereunder, and, if you voluntarily terminate your
employment hereunder (other than termination pursuant to Section 6.b. herein) or
if your employment hereunder is terminated by the Company for Cause, for the
duration of the Non-compete Period (as such term is defined below): (i) directly
or indirectly, employ or hire as a consultant or solicit for employment or
consulting, any officer or other employee of the Company; or (ii) enter into or
accept an employment position or any other situation or arrangement with an
organization or person or establish an entity that markets or sells distressed
airline, hotel and other travel services. For

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 7

the purposes of this Section 8, the "Non-compete Period" shall be: (i) if
termination as described herein occurs during the calendar year 2000, for 24
months from the date of such termination; (ii) if termination as described
herein occurs during the calendar year 2001, for 18 months from the date of such
termination; and (iii) if termination as described herein occurs during the
calendar year 2002, for 12 months from the date of such termination.

         9. Confidentiality. You acknowledge that you now have and will have
access to and become acquainted with proprietary and confidential information
regarding the Company and its customers that constitute valuable assets of the
Company and that is not available to the public. Accordingly, you agree that you
will not during the term of this letter or at any time thereafter, directly or
indirectly, (i) use or disclose such information, except as is necessary and
appropriate in connection with the rendering by you of services to the Company
under this letter, or (ii) make, or cause to be made, any statement or
publication about or concerning the Company or its shareholders (or any
fiduciary or beneficiary of any shareholder that is a trust or an estate) which
you reasonably believe not to be in the best interests of, or necessary for the
proper conduct of the businesses of, the Company or its shareholders (or any
fiduciary or beneficiary of any shareholder that is a trust or an estate), other
than statements or publications that are consistent with your supervision of the
corporate communication function of the Company as it relates to your duties or
that you reasonably believe to be necessary to protect and enforce your rights
under this letter. Nothing herein is intended to limit or affect any
responsibility you may have under any generally applicable policy, practice or
procedure of the Company.

         10. No Disclosure. The financial arrangements contemplated hereby are
sensitive and highly confidential, and, so long as you remain employed by the
Company, you will not use, disclose or make any public announcement regarding
such financial arrangements without the prior written consent of the Company (by
its Board of Directors or its chairman), except: (i) as may be required by
applicable law; (ii) disclosure in connection with your own personal tax or
financial affairs; or (iii) as may be required in order to enforce any term or
provision hereof.

         11. Injunctive Relief. You acknowledge and agree that if any provision
of Section 8, 9 or 10 hereof is violated, the Company will immediately and
irreparably be harmed, will not have an adequate remedy at law and will be
entitled to immediate relief enjoining such violation or threatened violation
(including without limitation temporary and permanent injunctions and/or a
decree for specific performance) in any court or judicial body having
jurisdiction over such claim, without the necessity of showing any actual damage
or posting any bond or furnishing any other security, and without having to
pursue any arbitration as provided below.

         12. Arbitration; Legal Fees. Any dispute that may arise between you and
the Company in connection with your employment hereunder, including, without
limitation, the terms or interpretation of this letter as they relate to the
existence of Cause, Change in Opportunity and the terms concerning termination
of employment upon such events, either during or following termination of your
employment hereunder shall be submitted to arbitration before three arbitrators
in the City of New York under the then applicable rules of the American

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 8

Arbitration Association. Judgment on any award rendered may be entered in any
court of the forum having jurisdiction. If the arbitrators find that the Company
has breached the substantive terms of this letter and the Company in doing so
acted capriciously, maliciously, or in bad faith, then the Company shall pay for
all of your costs and expenses, including reasonable attorney's fees, arising
from such proceeding.

         13. Miscellaneous.

         a. Notice. All notices and other communications provided for hereunder
shall be in writing (including by telex or facsimile transmission) and mailed or
sent or delivered at the addresses specified below. All such notices and
communications shall be given by hand, telex or facsimile transmission; provided
that, in the event that telex and facsimile transmission facilities are not
operational, such notices and communications may be given by mail, but the
sender shall use reasonable efforts to confirm facsimile transmission facilities
shall become operational. All such notices and communications shall be effective
when delivered by hand, or, in the case of mail, upon the earlier of receipt and
confirmation by telex or facsimile transmission as provided below, or, in the
case of facsimile transmission, when sent as addressed as set forth herein and
confirmation of delivery is received, or, in the case of telex, when the telex
is sent and the appropriate answer back is received. The address for you is set
forth in the beginning of this letter. The address for the Company is as
follows:

          SkyAuction.com, Inc.
          501 Madison Ave.
          14th Floor
          New York, NY 10022
          Telecopy No.: (212) 486-9751
          Attention: Chairman

          with copies to:

          Proskauer Rose LLP
          1585 Broadway
          New York, New York 10036-8299
          Telecopy No.: (212) 969-2900
          Attention: Jeffrey A. Horwitz, Esq.

Each party to this letter may, from time to time, change its notice address or
copy address or add or substitute a copy party and a copy address, by giving
notice to the other party in the manner provided in this paragraph.

         b. Entire Agreement. This letter (inclusive of any annex hereto)
contains the entire understanding and agreement of the parties with respect to
the subject matter hereof, and all prior negotiations, proposals and agreements
(whether written or oral) between them (or their respective affiliates) relating
to the subject matter hereof have, to the extent relating to such subject
matter, been superseded hereby. No agreements or

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 9

representations (whether oral or otherwise, express or implied) that are not
expressly set forth in, but that relate to the subject matter of, this letter,
have been made by either party.

         c. Amendment; Waiver. Neither this letter nor any provision hereof may
be amended or modified except in a writing signed by the party against which
enforcement of such amendment or modification is sought. No failure or delay of
any party in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce any such right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of each party under this letter are,
unless otherwise specifically provided herein, cumulative and not exclusive of
any rights or remedies that such party may otherwise have. No waiver by either
party of any provision of this letter nor any consent by either party to any
departure by the other party from any provision of this letter shall in any
event be effective unless the same shall be in writing (by the party against
which enforcement of such waiver or consent is sought), and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice or similar communication by one party
to the other shall entitle such other party to any other or further notice or
similar communication in similar or other circumstances, except as specifically
provided herein.

         d. Severability. If anyone or more of the provisions of this letter
shall be invalid, illegal or unenforceable in any respect, it shall be
ineffective only to the extent of such invalidity, illegality or
unenforceability, and shall not in any way affect or impair the validity,
legality and enforceability of the balance of such provision or any other
provision contained herein. Each party shall endeavor in good faith negotiations
to replace the invalid, illegal or unenforceable provision(s) (or such portion
thereof) with such valid, legal and enforceable provision(s), the economic
effect of which on the respective parties is as close as possible to that of the
invalid, illegal or unenforceable provision(s).

         e. Successors and Assistants. This letter shall be binding upon and
inure to the benefit of the respective successors and permitted assigns of the
parties hereto; provided, that no party may, without the prior written consent
of the other, assign, transfer or delegate this letter or any of such party's
rights or obligations hereunder (whether directly or indirectly, by operation of
law or otherwise) to any other person, firm or entity.

         f. Rights of Third Parties. Anything in this letter to the contrary
notwithstanding, no person, firm or entity shall be entitled to the benefit of,
or to enforce, any provision hereof other than the parties hereto (and their
heirs, permitted successors and assigns).

         g. Survival. The respective rights and obligations of you and the
Company as provided herein shall survive the termination or expiration hereof to
the extent necessary to the intended preservation of such rights and
obligations.

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 10

         h. Governing Law. This letter shall be construed and interpreted
according to the laws of the State of New York, without reference to such
State's principles governing conflicts of laws.

         i. Headings. The headings used herein are for convenience of reference
only, are not part of this letter and are not intended to affect the
construction, or to be taken into account in the interpretation, of this letter.

         j. Counterparts; Effect. This letter may be signed in counterparts with
the same effect as if the signatures were all upon the same instrument;
provided, that no party shall be bound hereto unless and until all parties have
executed and delivered this letter (or a counterpart).

<PAGE>

Mr. Michael N. Hering
as of January 1, 2000
page 11

         Please confirm your agreement with the foregoing by signing and
returning to us at least two copies of this letter.

                                        Sincerely,

                                        SKYAUCTION.COM INC.

                                        By: /s/ Leonard Schutzman
                                            -------------------------
                                                Leonard Schutzman
                                                Chairman

AGREED TO AND ACCEPTED:

/s/ Michael N. Hering
-------------------------------
MICHAEL N. HERING

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00012-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00012-of-00352.parquet"}]]