Director Option Plan - GSV Inc.
CYBERSHOP INTERNATIONAL, INC.
DIRECTOR OPTION PLAN
The purpose of the Director Option Plan (the "Plan") of CyberShop
International, Inc., a Delaware corporation (the "Company"), is to encourage
ownership in the Company by outside directors of the Company whose continued
services are considered essential to the Company's future progress and to
provide them with a further incentive to remain as directors of the Company.
The Compensation Committee of the Company's Board of Directors (the
"Committee") shall supervise and administer the Plan. Grants of stock options
under the Plan and the amount and nature of the awards to be granted shall be
automatic and non-discretionary in accordance with Section 5. However, all
questions of interpretation of the Plan or of any options issued under it shall
be determined by the Committee and such determination shall be final and binding
upon all persons having an interest in the Plan.
3. DIRECTORS ELIGIBLE FOR PARTICIPATION
Each director of the Company who is not an employee of, or consultant
to, the Company or any subsidiary or affiliate of the Company shall be eligible
to participate in the Plan.
4. STOCK SUBJECT TO THE PLAN
(a) The maximum number of common shares which may be issued under
the Plan shall be seventy thousand (70,000) shares of common
stock, par value $.001 of the Company ("Common Stock").
(b) If any outstanding option under the Plan for any reason
expires or is terminated without having been exercised in
full, the Common Stock allocable to the unexercised portion
of such option shall again become available for grant
pursuant to the plan.
5. TERMS, CONDITIONS AND FORM OF OPTIONS
Each option granted under the Plan shall be evidenced by a written
agreement in such form as the Committee shall from time to time approve, which
agreements shall comply with and be subject to the following terms and
(a) Option Grant Dates. Each eligible director, including a
director serving in that capacity on the effective date of
the Plan, shall be granted an option to purchase three
thousand (3,000) shares of Common Stock for each year such
director serves on the Board of the Company. Such option
shall be granted on the date of election or reelection of the
Director. All options granted under the Plan shall vest on
the first anniversary of the date of grant and shall be
exercisable for a period of three (3) years thereafter.
(b) Option Exercise Price. The option exercise price per share of
Common Stock for each option granted under the Plan shall be
equal to the fair market value of the stock on the date of
grant. For the purposes hereof, the term "fair market value"
shall mean the fair market value as determined in good faith
by the Committee.
(c) Options Non-Transferable. Each option granted under the Plan
by its terms shall not be transferable by the optionee
otherwise than by will, or by the laws of descent and
distribution, or pursuant to a qualified domestic relations
order (as defined in Section 414(p) of the United States
Internal Revenue Code (the "Code")), and shall be exercised
during the lifetime of the optionee only by him. No option or
interest therein may be transferred, assigned, pledged or
hypothecated by the optionee during his lifetime, whether by
operation of law or otherwise, or be made subject to
execution, attachment or similar process.
(d) Exercise Period. Except as otherwise provided in the plan,
each option may be exercised fully on the date of grant of
such option, provided that, subject to the provisions of
Section 5(e), no option may be exercised more than ninety
(90) days after the optionee ceases to serve as a director of
the Company. No option shall be exercisable after the
expiration of four (4) years from the date of grant or prior
to approval of the Plan by the stockholders of the Company,
whichever is earlier.
(e) Exercise Period Upon Death. Notwithstanding the provisions of
Section 5(d), any option granted under the Plan may be
exercised in full upon the death of an optionee while serving
as a director of the Company by the person to whom it is
transferred by will, by the laws of descent and distribution
or by written notice filed pursuant to Section 5(h).
(f) Exercise Procedure. Options may be exercised only by written
notice to the Company at its principal office accompanied by
payment of the full consideration for the Common Stock as to
which they are exercised.
(g) Payment of Purchase Price. Options granted under the Plan may
provide for the payment of the exercise price (i) by delivery
of cash or a check to the order
of the Company in an amount equal to the exercise price of
such options or, (ii) to the extent provided in the
applicable option agreement, by delivery to the Company of
Common Stock then owned by the optionee having a fair market
value equal in amount to the exercise price of the Options
being exercised, or (iii) by any combination of such methods
of payment. The fair market value of any Common Stock or
other non-cash consideration which may be delivered upon
exercise of an option shall be determined by the Committee.
(h) Exercise of Representative Following Death of Director. A
director, by written notice to the Company, may designate one
or more persons (and from time to time change such
designation) including his legal representative, who, by
reason of his death, shall acquire the right to exercise all
or a portion of the option. If the person or persons so
designated wish to exercise any portion of the option, they
must do so within the term of the option as provided herein.
Any exercise by a representative shall be subject to the
provisions of the Plan.
The rights and benefits under the Plan may not be assigned except for
the designation of a beneficiary as provided in Section 5.
7. LIMITATION OF RIGHTS
(a) No Right to Continue as a Director. Neither the Plan nor the
granting of an option nor any other action taken pursuant to
the Plan, shall constitute or be evidence of any agreement or
understanding, express or implied, that the Company will
retain a director for any period of time.
(b) No Stockholders' Rights for Options. An optionee shall have
no rights as a stockholder with respect to the Common Stock
covered by his options until the date of the issuance to him
of a share certificate therefor, and no adjustment will be
made for dividends or other rights for which the record date
is prior to the date such certificate is issued.
8. CHANGES IN CAPITAL STOCK
(a) If (x) the outstanding shares of Common Stock are increased,
decreased or exchanged for a different number or kind of
share or other security of Company, or (y) additional shares
of Common Stock or new or different shares of Common Stock or
other securities of the Company or other non-cash assets are
distributed with respect to such shares or other securities,
through or as a result of any merger, consolidation, sale of
all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock
stock split, reverse stock split or other similar transaction
with respect to such shares or other securities, an
appropriate and proportionate adjustment shall be made in (i)
the maximum number and kind of shares reserved for issuance
under the Plan, and (ii) the number and kind of shares or
other securities subject to then outstanding options under
the Plan and (iii) the price for each share subject to any
then outstanding options under the Plan, without changing the
aggregate purchase price as to which such options remain
exercisable. No fractional shares will be issued under the
Plan on account of any such adjustments. Notwithstanding the
foregoing, no adjustment shall be made pursuant to this
Section 8 if such adjustment would cause the Plan to fail to
comply with Rule 16b-3 or any successor rule promulgated
pursuant to Section 16 of the Securities Exchange Act of
1934, as amended.
(b) In the event that the Company is merged or consolidated into
or with another corporation (in which consolidation or
merger, the stockholders of the Company receive distributions
of cash or securities of another issuer as a result thereof),
or in the event that all or substantially all of the assets
of the Company are acquired by any other person or entity, or
in the event of a reorganization or liquidation of the
Company, the Board of Directors of the Company, or the board
of directors of any corporation assuming the obligations of
the Company, shall, as to outstanding options take one or
more of the following actions: (i) provide that such options
shall be assumed, or equivalent options shall be sub
stituted, by the acquiring or succeeding corporation (or an
affiliate thereof), (ii) upon written notice to the optionee,
provide that all unexercised options will terminate
immediately prior to the consummation of such transaction
unless exercised by the optionee within a specified period
following the date of such notice, or (iii) if, under the
terms of a merger transaction, holders of the Common Stock
will receive upon consummation thereof a cash payment for
each share surrendered in the merger (the "Merger Price"),
make or provide for a cash payment to the optionees equal to
the difference between (A) the Merger Price times the number
of shares of Common Stock subject to such outstanding options
(to the extent then exercisable at prices not in excess of
the Merger Price) and (B) the aggregate exercise price of all
such outstanding options in exchange for the termination of
9. AMENDMENT OF THE PLAN
The Committee may suspend or discontinue the Plan or review or amend
it in any respect whatsoever; provided, however, that without approval of the
stockholders of the Company no revision or amendment shall change the number of
shares subject to the Plan or the number of shares issuable to any director of
the Company under the Plan (except as provided in Section 8), change the
designation of the class of directors eligible to receive options, or materially
increase the benefits accruing to participants under the Plan, and further
provided, that no amendment to the number of shares of Common Stock issuable to
any director shall be effected more than once in any six month period.
The Company shall have the right to deduct from payments of any kind
otherwise due to the optionee, any federal, state or local taxes of any kind
required by law to be withheld with respect to any shares issued upon exercise
of options under the Plan.
11. EFFECTIVE DATE AND DURATION OF THE PLAN
(a) Effective Date. The Plan shall become effective when adopted
by the Board of Directors of the Company and approved by the
Company's stockholders. Amendments to the plan not requiring
stockholder approval shall become effective when adopted by
the Committee; amendments requiring stockholder approval
shall become effective when adopted by the Committee, but no
option granted after the date of such amendment shall become
exercisable (to the extent that such amendment to the Plan
was required to enable the Company to grant such option to a
particular optionee) unless and until such amendment shall
have been approved by the Company's stockholders. If such
stockholder approval is not obtained within six months of the
Committee's adoption of such amendment, any options granted
on or after the date of such amendment shall terminate to the
extent that such amendment to the Plan was required to enable
the Company to grant such option to a particular optionee.
(b) Termination. Unless sooner terminated by the Committee, the
Plan shall terminate upon the date on which all shares
available for issuance under the Plan shall have been issued
pursuant to the exercise or cancellation of options granted
under the Plan.
Any written notice to the Company required by any of the provisions of
the Plan shall be addressed to the Secretary of the Company and shall become
effective when it is received.
13. GOVERNMENTAL REGULATION
The Company's obligation to sell and deliver shares of Common Stock
under the plan is subject to the approval of or requirements of any governmental
authority applicable in connection with the authorization issuance or sale of
14. COMPLIANCE WITH RULE 16b-3
Transactions under the Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successor promulgated pursuant to Section 16 of
the Securities Exchange Act of 1934, as amended. To the extent any provision of
the Plan or action by the Committee in administering the plan fails to so
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Committee.
15. GOVERNING LAW
The Plan and all determinations made and actions taken pursuant hereto
shall be governed by the laws of the State of Delaware and the laws of the
United States applicable therein.
16. SUCCESSORS AND ASSIGNS
This Plan shall inure to the benefit of and be binding upon each
successor and assign of the Company. All obligations imposed upon an optionee,
and all rights granted to the Company hereunder, shall be binding upon the
optionee's heirs, legal representatives and successors.
17. ENTIRE AGREEMENT
This Plan and the written agreement with respect to each option
granted under this Plan constitute the entire agreement with respect to the
subject matter hereof and thereof, provided that in the event of any
inconsistency between the Plan and such written agreement, the terms and
conditions of this Plan shall control.