1996 Flexible Stock Incentive Plan - InfoSpace.com Inc.

 
                              INFOSPACE.COM, INC.
                  RESTATED 1996 FLEXIBLE STOCK INCENTIVE PLAN
                                        

1.   Establishment, Purpose, and Definitions.

     (a)  There is hereby adopted the Restated 1996 Flexible Stock Incentive
          Plan (the "PLAN") of InfoSpace.com, Inc., a Delaware corporation (the
          "COMPANY").

     (b)  The purpose of the Plan is to provide a means whereby eligible
          individuals (as defined in paragraph 4, below) can acquire Common
          Stock of the Company (the "STOCK"). The Plan provides employees
          (including officers and directors who are employees) of the Company
          and of its Affiliates an opportunity to purchase shares of Stock
          pursuant to options which may qualify as incentive stock options
          (referred to as "INCENTIVE STOCK OPTIONS") under Section 422 of the
          Internal Revenue Code of 1986, as amended (the "CODE"), and employees,
          officers, directors, independent contractors, and consultants of the
          Company and of its Affiliates an opportunity to purchase shares of
          Stock pursuant to options which are not described in Section 422 or
          423 of the Code (referred to as "NONQUALIFIED STOCK OPTIONS"). The
          Plan also provides for the sale or bonus of Stock to eligible
          individuals in connection with the performance of services for the
          Company or its Affiliates. Finally, the Plan authorizes the grant of
          stock appreciation rights ("SARS"), either separately or in tandem
          with stock options, entitling holders to cash compensation measured by
          appreciation in the value of the Stock.

     (c)  The term "AFFILIATES" as used in the Plan means parent or subsidiary
          corporations, as defined in Sections 424(e) and (f) of the Code (but
          substituting "the Company" for "employer corporation"), including
          parents or subsidiaries which become such after adoption of the Plan.

2.   ADMINISTRATION OF THE PLAN.

     (a)  The Plan shall be administered by the Board of Directors of the
          Company (the "BOARD") or a committee or committees (which term
          includes subcommittees) appointed by, and consisting of one or more
          members of, the Board (the "PLAN ADMINISTRATOR"). If and so long as
          the Common Stock is registered under Section 12(b) or 12(g) of the
          Exchange Act, the Board shall consider in selecting the Plan
          Administrator and the membership of any committee acting as Plan
          Administrator, with respect to any persons subject or likely to become
          subject to Section 16 of the Exchange Act, the provisions regarding
          (i) "outside directors" as contemplated by Section 162(m) of the Code
          and

 
          (ii) "nonemployee directors" as contemplated by Rule 16b-3 under the
          Exchange Act. The Board may delegate the responsibility for
          administering the Plan with respect to designated classes of eligible
          Participants to different committees consisting of one or more members
          of the Board, subject to such limitations as the Board or the Plan
          Administrator deems appropriate. Committee members shall serve for
          such term as the Board may determine, subject to removal by the Board
          at any time.

     (b)  The Plan Administrator shall determine which eligible individuals (as
          defined in paragraph 4, below) shall be granted options under the
          Plan, the timing of such grants, the terms thereof (including any
          restrictions on the Stock), and the number of shares subject to such
          options.

     (c)  The Plan Administrator may amend the terms of any outstanding option
          granted under this Plan, but any amendment which would adversely
          affect the Optionee's rights under an outstanding option shall not be
          made without the Optionee's written consent. The Plan Administrator
          may, with the Optionee's written consent, cancel any outstanding stock
          option or accept any outstanding stock option in exchange for a new
          option. Notwithstanding the foregoing, any change or adjustment to an
          incentive stock option shall not, without the Optionee's written
          consent, be made in a manner so as to constitute a "modification" that
          would cause such incentive stock option to fail to continue to qualify
          as an incentive stock option.

     (d)  The Plan Administrator shall also determine which eligible individuals
          (as defined in paragraph 4, below) shall be issued Stock or SARs under
          the Plan, the timing of such grants, the terms thereof (including any
          restrictions), and the number of shares or SARs to be granted. The
          Stock shall be issued for such consideration (if any) as the Plan
          Administrator deems appropriate. Stock issued subject to restrictions
          shall be evidenced by a written agreement (the "RESTRICTED STOCK
          PURCHASE AGREEMENT" or the "RESTRICTED STOCK BONUS AGREEMENT"). The
          Plan Administrator may amend any Restricted Stock Purchase Agreement
          or Restricted Stock Bonus Agreement, but any amendment which would
          adversely affect the stockholder's rights to the Stock shall not be
          made without his or her written consent.

     (e)  The Plan Administrator shall have the sole authority, in its absolute
          discretion to adopt, amend, and rescind such rules and regulations as,
          in its opinion, may be advisable for the administration of the Plan,
          to construe and interpret the Plan, the rules and the regulations, and
          the instruments evidencing options or Stock granted under the Plan and
          to make all other determinations deemed necessary or advisable for the
          administration of the Plan. All decisions, determinations, and
          interpretations of the Plan Administrator shall be binding on all
          participants.

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3.   STOCK SUBJECT TO THE PLAN.

     (a)  An aggregate of not more than Three Million (3,000,000) shares of
          Stock shall be available for the grant of stock options or the
          issuance of Stock under the Plan. If an option is surrendered (except
          surrender for shares of Stock) or for any other reason ceases to be
          exercisable in whole or in part, the shares which were subject to such
          option but as to which the option had not been exercised shall
          continue to be available under the Plan. Any Stock which is retained
          by the Company upon exercise of an option in order to satisfy the
          exercise price for such option or any withholding taxes due with
          respect to such option exercise shall be treated as issued to the
          Optionee and will thereafter not be available under the Plan.

     (b)  If there is any change in the Stock subject to the Plan, an Option
          Agreement, a Restricted Stock Purchase Agreement, a Restricted Stock
          Bonus Agreement, or a SAR Agreement through merger, consolidation,
          reorganization, recapitalization, reincorporation, stock split, stock
          dividend, or other change in the capital structure of the Company,
          appropriate adjustments shall be made by the Plan Administrator in
          order to preserve but not to increase the benefits to the individual,
          including adjustments to the aggregate number, kind and price per
          share of shares subject to the Plan, an Option Agreement, a Restricted
          Stock Purchase Agreement, a Restricted Stock Bonus Agreement, or a SAR
          Agreement.

4.   ELIGIBLE INDIVIDUALS.  Individuals who shall be eligible to have granted to
     them the options, Stock or SARs provided for by the Plan shall be such
     employees, officers, directors, independent contractors and consultants of
     the Company or an Affiliate as the Plan Administrator, in its discretion,
     shall designate from time to time. Notwithstanding the foregoing, only
     employees of the Company or an Affiliate (including officers and directors
     who are bona fide employees) shall be eligible to receive incentive stock
     options.

5.   THE OPTION PRICE.

     (a)  The exercise price of the Stock covered by each incentive stock option
          shall be not less than the per share fair market value of such Stock
          on the date the option is granted. The exercise price of the Stock
          covered by each nonqualified stock option shall be as determined by
          the Plan Administrator and shall be not less than 85% of the per share
          fair market value of such Stock on the date the option is granted.
          Notwithstanding the foregoing, in the case of an incentive stock
          option granted to a person possessing more than ten percent of the
          combined voting power of the Company or an Affiliate, the exercise
          price shall be not less than 110 percent of the fair market value of
          the Stock on the

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          date the option is granted. The exercise price of an option shall be
          subject to adjustment to the extent provided in paragraph 3(b), above.

     (b)  The fair market value shall be as established in good faith by the
          Plan Administrator or (i) if the Stock is listed on the Nasdaq
          National Market, the fair market value shall be the closing selling
          price for the stock as reported by the Nasdaq National Market for a
          single day or (ii) if the Stock is listed on the New York Stock
          Exchange or the American Stock Exchange, the fair market value shall
          be the closing selling price for the Stock as such price is officially
          quoted in the composite tape of transactions on such exchange for a
          single trading day. If there is no such reported price for the Stock
          for the date in question, then such price on the last preceding date
          for which such price exists shall be determinative of the fair market
          value.

6.   TERMS AND CONDITIONS OF OPTIONS.

     (a)  Each option granted pursuant to the Plan will be evidenced by a
          written Stock Option Agreement executed by the Company and the person
          to whom such option is granted.

     (b)  The Plan Administrator shall determine the term of each option granted
          under the Plan; provided, however, that the term of an incentive stock
          option shall not be for more than 10 years and that, in the case of an
          incentive stock option granted to a person possessing more than ten
          percent of the combined voting power of the Company or an Affiliate,
          the term shall be for no more than five years.

     (c)  In the case of incentive stock options, the aggregate fair market
          value (determined as of the time such option is granted) of the Stock
          with respect to which incentive stock options are exercisable for the
          first time by an eligible employee in any calendar year (under this
          Plan and any other plans of the Company or its Affiliates) shall not
          exceed $100,000. In the event the optionee holds two or more such
          options that become exercisable for the first time in the same
          calendar year, such limitation shall be applied on the basis of the
          order in which such options are granted.

     (d)  The Stock Option Agreement may contain such other terms, provisions
          and conditions not inconsistent with this Plan as may be determined by
          the Plan Administrator. If an option, or any part thereof is intended
          to qualify as an incentive stock option, the Stock Option Agreement
          shall contain those terms and conditions which are necessary to so
          qualify it. To the extent required by applicable law, options granted
          under the Plan must provide for the right of the optionee to exercise
          the option at the rate of at least 20% per year over 5 years from the
          date the option is granted.

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7.   TERMS AND CONDITIONS OF STOCK PURCHASES AND BONUSES.

     (a)  Each sale or grant of stock pursuant to the Plan will be evidenced by
          a written Restricted Stock Purchase Agreement or Restricted Stock
          Bonus Agreement executed by the Company and the person to whom such
          stock is sold or granted.

     (b)  The Restricted Stock Purchase Agreement or Restricted Stock Bonus
          Agreement may contain such other terms, provisions and conditions
          consistent with this Plan as may be determined by the Plan
          Administrator, including not by way of limitation, restrictions on
          transfer, forfeiture provisions, repurchase provisions and vesting
          provisions. To the extent required by applicable law, any right of the
          Company to repurchase stock granted pursuant to a restricted stock
          purchase or restricted stock bonus at the original purchase price (i)
          must lapse at the rate of at least 20% per year over 5 years from the
          date the stock was purchased, which right must be exercised within 90
          days of termination of employment for cash or cancellation of purchase
          money indebtedness for the shares, and (ii) if the right is
          assignable, the assignee must pay the Company upon assignment of the
          right cash equal to the difference between the original price and fair
          value if the original purchase price is less than fair value.

     (c)  The purchase price of Stock sold hereunder pursuant to a Restricted
          Stock Purchase Agreement shall be the price determined by the Plan
          Administrator on the date the right to purchase Stock is granted;
          provided, however that (i) such price shall not be less than 85% of
          the per share fair market value of such Stock on the date the right to
          purchase Stock is granted and (ii) to the extent required by
          applicable law, in the case of any person who owns Company stock
          possessing more than 10% of the total combined voting power of all
          classes of stock of the Company, such price shall be 100% of the per
          share fair market value of such Stock at the time the right to
          purchase Stock is granted, or at the time the purchase is consummated.

8.   TERMS AND CONDITIONS OF SARS.  The Plan Administrator may, under such terms
     and conditions as it deems appropriate, authorize the issuance of SARs
     evidenced by a written SAR agreement (which, in the case of tandem options,
     may be part of the option agreement to which the SAR relates) executed by
     the Company and the person to whom such SAR is granted. The SAR agreement
     may contain such terms, provisions and conditions consistent with this Plan
     as may be determined by the Plan Administrator.

9.   USE OF PROCEEDS.  Cash proceeds realized from the sale of Stock under the
     Plan shall constitute general funds of the Company.

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10.  AMENDMENT, SUSPENSION, OR TERMINATION OF THE PLAN.

     (a)  The Board may at any time amend, suspend or terminate the Plan as it
          deems advisable; provided that such amendment, suspension or
          termination complies with all applicable requirements of state and
          federal law, including any applicable requirement that the Plan or an
          amendment to the Plan be approved by the Company's stockholders, and
          provided further that, except as provided in paragraph 3(b), above,
          the Board shall in no event amend the Plan in the following respects
          without the consent of stockholders then sufficient to approve the
          Plan in the first instance:

          (i)  To increase the maximum number of shares subject to incentive
               stock options issued under the Plan; or

          (ii) To change the designation or class of persons eligible to receive
               incentive stock options under the Plan.

     (b)  No option may be granted nor any Stock issued under the Plan during
          any suspension or after the termination of the Plan, and no amendment,
          suspension or termination of the Plan shall, without the affected
          individual's consent, alter or impair any rights or obligations under
          any option previously granted under the Plan. The Plan shall terminate
          with respect to the grant of incentive stock options on April 10,
          2006, unless previously terminated by the Board pursuant to this
          paragraph 10.

11.  The Plan Administrator shall establish and set forth in each instrument
     that evidences an option whether the option will continue to be
     exercisable, and the terms and conditions of such exercise, if an optionee
     ceases to be employed by, or to provide services to, the Company or an
     Affiliate, which provisions may be waived or modified by the Plan
     Administrator at any time.

12.  ASSIGNABILITY.  Each option granted pursuant to this Plan shall, during
     optionee's lifetime, be exercisable only by him, and the option shall not
     be transferable by optionee by operation of law or otherwise other than by
     will or the laws of descent and distribution. Notwithstanding the
     foregoing, and to the extent permitted by Section 422 of the Code, the Plan
     Administrator, in its sole discretion, may permit such transfer, assignment
     and exercisability and may permit an optionee to designate a beneficiary
     who may exercise the option after the optionee's death; provided, however,
     that any option so transferred or assigned shall be subject to all the same
     terms and conditions contained in the instrument evidencing the option.
     Stock subject to a Restricted Stock Purchase Agreement or a Restricted
     Stock Bonus Agreement shall be transferable only as provided in such
     Agreement.

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13.  PAYMENT UPON EXERCISE OF OPTIONS.

     (a)  Payment of the purchase price upon exercise of any option granted
          under this Plan shall be made in cash, a certified check, bank draft,
          postal or express money order payable to the order of the Company,
          provided, however, that the Plan Administrator, in its sole
          discretion, may permit an optionee to pay the option price in whole or
          in part (i) tendering (either actually or, if and so long as the Stock
          is registered under Section 12(b) or 12(g) of the Securities Exchange
          Act of 1934, as amended (the "Exchange Act"), shares of Stock owned by
          the optionee for at least six months (or any shorter period necessary
          to avoid a charge to the Company's earnings for financial reporting
          purposes) on the day prior to the exercise date equal to the aggregate
          option exercise price; (ii) if and so long as the stock is registered
          under Section 12(b) or 12(g) of the Exchange Act, by delivery on a
          form prescribed by the Plan Administrator of an irrevocable direction
          to a securities broker approved by the Plan Administrator to sell
          shares and deliver all or a portion of the proceeds to the Company in
          payment for the Stock; (ii) by delivery of the optionee's promissory
          note with such full recourse, interest, security, and redemption
          provisions as the Plan Administrator in its discretion determines
          appropriate; or (iii) in any combination of the foregoing. The amount
          of any promissory note delivered in connection with an incentive stock
          option shall bear interest at a rate specified by the Plan
          Administrator but in no case less than the rate required to avoid
          imputation of interest (taking into account any exceptions to the
          imputed interest rules) for federal income tax purposes.. In addition,
          the Plan Administrator, in its sole discretion, may authorize the
          surrender by an optionee of all or part of an unexercised option and
          authorize a payment in consideration thereof of an amount equal to the
          difference between the aggregate fair market value of the Stock
          subject to such option and the aggregate option price of such Stock.
          In the Plan Administrator's discretion, such payment may be made in
          cash, shares of Stock with a fair market value on the date of
          surrender equal to the payment amount, or some combination thereof.
          The purchase price for shares purchased under an option may also be
          paid by such other consideration as the Plan Administrator may permit.

     (b)  In the event that the exercise price is satisfied by the Plan
          Administrator retaining from the shares of Stock otherwise to be
          issued to Optionee shares of Stock having a value equal to the
          exercise price, the Plan Administrator may issue Optionee an
          additional option, with terms identical to this option agreement,
          entitling Optionee to purchase additional Stock in an amount equal to
          the number of shares so retained.

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14.  WITHHOLDING TAXES.

     (a)  No Stock shall be granted or sold under the Plan to any participant,
          and no SAR may be exercised, until the participant has made
          arrangements acceptable to the Plan Administrator for the satisfaction
          of federal, state, and local income and social security tax
          withholding obligations, including without limitation obligations
          incident to the receipt of Stock under the Plan, the lapsing of
          restrictions applicable to such Stock, the failure to satisfy the
          conditions for treatment as incentive stock options under applicable
          tax law, or the receipt of cash payments. Upon exercise of a stock
          option or lapsing or restriction on stock issued under the Plan, the
          Company may satisfy its withholding obligations by withholding from
          the Optionee or requiring the stockholder to surrender shares of the
          Company's Stock sufficient to satisfy federal, state, and local income
          and social security tax withholding obligations.

     (b)  In the event that such withholding is satisfied by the Company or the
          Optionee's employer retaining from the shares of Stock otherwise to be
          issued to Optionee shares of Stock having a value equal to such
          withholding tax, the Plan Administrator may issue Optionee an
          additional option, with terms identical to the option agreement under
          which the option was received, entitling Optionee to purchase
          additional Stock in an amount equal to the number of shares so
          retained.

15.  RESTRICTIONS ON TRANSFER OF SHARES.  At the discretion of the Plan
     Administrator, the Stock acquired pursuant to the Plan shall be subject to
     such restrictions and agreements regarding sale, assignment, encumbrances
     or other transfer as are in effect among the stockholders of the Company at
     the time such Stock is acquired, as well as to such other restrictions as
     the Plan Administrator shall deem advisable.

16.  CORPORATE TRANSACTION.

     (a)  For purposes of this Section 16, a "CORPORATE TRANSACTION" shall
          include any of the following stockholder-approved transactions to
          which the Company is a party:

          (i)   a merger or consolidation in which the Company is not the
                surviving entity, except for (1) a transaction the principal
                purpose of which is to change the state of the Company's
                incorporation, or (2) a transaction in which the Company's
                stockholders immediately prior to such merger or consolidation
                hold (by virtue of securities received in exchange for their
                shares in the Company) securities of the surviving entity
                representing more than fifty percent (50%) of the total voting
                power of such entity immediately after such transaction;

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          (ii)  the sale, transfer or other disposition of all or substantially
                all of the assets of the Company unless the Company's
                stockholders immediately prior to such sale, transfer or other
                disposition hold (by virtue of securities received in exchange
                for their shares in the Company) securities of the purchaser or
                other transferee representing more than fifty percent (50%) of
                the total voting power of such entity immediately after such
                transaction; or

          (iii) any reverse merger in which the Company is the surviving entity
                but in which the Company's stockholders immediately prior to
                such merger do not hold (by virtue of their shares in the
                Company held immediately prior to such transaction) securities
                of the Company representing more than fifty percent (50%) of the
                total voting power of the Company immediately after such
                transaction.

     (b)  In the event of any Corporate Transaction, any option or outstanding
          SAR shall terminate and any restricted stock shall be reconveyed to or
          repurchased by the Company immediately prior to the specified
          effective date of the Corporate Transaction; provided, however, that
          to the extent permitted by applicable law, including Section
          260.140.41 of the California Code of Regulations, any unvested option,
          SAR or any restricted stock that would otherwise vest within twelve
          months from the specified effective date of the Corporate Transaction
          shall vest and become exercisable, or become nonforfeitable, as
          applicable, immediately prior to the specified effective date of the
          Corporate Transaction. Notwithstanding the foregoing, options, SARs or
          restricted stock shall not terminate, accelerate or become
          nonforfeitable if, in connection with the Corporate Transaction, they
          are to be assumed by the successor corporation or its parent company,
          pursuant to options, SARs or restricted stock agreements providing
          substantially equal value and having substantially equivalent
          provisions as the options, SARs or restricted stock granted pursuant
          to this Plan.

17.  STOCKHOLDER APPROVAL.  This Plan shall only become effective with regard to
     incentive stock options upon its approval by a majority of the stockholders
     voting (in person or by proxy) at a stockholders' meeting held within 12
     months of the Board's adoption of the Plan. The Plan Administrator may
     grant incentive stock options under the Plan prior to the stockholders'
     meeting, but until stockholder approval of the Plan is obtained, no
     incentive stock option shall be exercisable.

18.  INFORMATION TO PLAN PARTICIPANTS.  The Company shall provide to each Plan
     participant, during any period for which said participant has one or more
     options or SARs or shares acquired pursuant to the Plan outstanding, copies
     of annual reports of the Company issued during said period.

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19.  NO RIGHTS AS A STOCKHOLDER.  No option shall entitle the optionee to any
     dividend, voting or other right of a stockholder unless and until the date
     of issuance under the Plan of the shares that are the subject of such
     option, free of all applicable restrictions.

20.  NO TRUST OR FUND.  The Plan is intended to constitute an "unfunded" plan.
     Nothing contained herein shall require the Company to segregate any monies
     or other property, or shares of Stock, or to create any trusts, or to make
     any special deposits for any immediate or deferred amounts payable to any
     optionee, and no optionee shall have any rights that are greater than those
     of a general unsecured creditor of the Company.

21.  SEVERABILITY.  If any provision of the Plan or any option is determined to
     be invalid, illegal or unenforceable in any jurisdiction, or as to any
     person, or would disqualify the Plan or any option under any law deemed
     applicable by the Plan Administrator, such provision shall be construed or
     deemed amended to conform to applicable laws, or, if it cannot be so
     construed or deemed amended without, in the Plan Administrator's
     determination, materially altering the intent of the Plan or the option,
     such provision shall be stricken as to such jurisdiction, person or option,
     and the remainder of the Plan and any such option shall remain in full
     force and effect.

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