Grant Certificate - FreeMarkets OnLine Inc. and Thomas McLeod
FreeMarkets OnLine, Inc.
1998 STOCK OPTION PLAN
Grant Certificate
This Grant Certificate, dated May 28, 1998, evidences the grant of an option
pursuant to the provisions of the 1998 Stock Option Plan (the "Plan") of
FreeMarkets OnLine, Inc. (the "Company") to the individual whose name appears
below (the "Grantee"), covering the specific number of shares of Common Stock of
the Company, par value $.01 per share ("Shares") set forth below, pursuant to
the provisions of the Plan and on the following terms and conditions:
1. Name of Grantee: Thomas McLeod
2. Number of Shares subject to this option: 123,076 Shares
3. Exercise price per Share subject to this option: $3.25
4. Date of grant of this option: May 28, 1998
5. Vesting: Date Number of Shares
---- ----------------
May 28, 2001 30,769
May 28, 2002 30,769
May 28, 2003 30,769
May 28, 2004 30,769
(1) In the event that the Company consummates an underwritten public offering
of shares registered with the Securities and Exchange Commission
(an "IPO"), 30% of any options which are not vested as of the date of the
consummation of the IPO, shall vest on such date, and any remaining
unvested options shall continue to vest ratably over the vesting period
set forth above.
(2) Upon the occurrence of a "Change of Control" of the Company, as defined
in the attached, 50% of any of the above options which are not vested
upon the occurrence of a Change of Control, shall vest on the date of
such occurrence, and any remaining unvested options shall continue to
vest ratably over the vesting period set forth above.
Vesting ceases immediately upon termination of employment for any reason, and
any portion of this option that has not vested on or prior to the date of
such termination is forfeited on such date. Once vesting has occurred, the
vested portion can be exercised at any time, subject to Section 6 below.
6. The last day on which the vested portion of this option can be exercised is
the earliest of:
a. May 28, 2008 [tenth anniversary of date of grant];
b. the date on which Grantee's employment terminates for "cause"
(as defined in the Plan);
c. 60 days following the date that Grantee's employment terminates other than
for "cause" (as defined in the Plan); or
d. one year following the Grantee's death or "permanent disability"
(as defined in the Plan).
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7. Type of option: Incentive Stock Option
The Grantee hereby acknowledges receipt of a copy of the Plan as presently in
effect. All of the terms and conditions of the Plan are incorporated herein by
reference (including but not limited to capitalized terms not otherwise defined
herein), and this option is subject to such terms and conditions in all
respects. This Grant Certificate and the Plan constitute the entire agreement of
the parties with respect to the subject matter hereof, and supersede any prior
written or oral agreements. If the Grantee is entitled to exercise the vested
portion of this option, and wishes to do so, in whole or in part, the Grantee
shall submit to the Company a written notice of exercise in the form attached to
this Grant Certificate, specifying the exercise date and the number of Shares to
be purchased pursuant to such exercise, and shall remit to the Company in a form
satisfactory to the Company (in its sole discretion) the exercise price, plus an
amount sufficient to satisfy any withholding tax obligations of the Company that
arise in connection with such exercise.
Accepted and Agreed: FreeMarkets OnLine, Inc.
/s/ Thomas McLeod By: /s/ Glen T. Meakem
-------------------------- -----------------------------------------
Employee Signature Name: Glen T. Meakem
Title: President and Chief Executive Officer
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FURTHER RESOLVED, that for the purposes of the Senior Leadership Options, a
"Change in Control" shall mean the occurrence of any of the following events:
(i) the acquisition, other than from the Company, by any individual,
entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person")
(other than the Company or an employee benefit plan of the Company) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of more than 50% of the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the "Voting Securities"); or
(ii) the approval by the stockholders of the Company of a
reorganization, merger, consolidation or recapitalization of the Company (a
"Business Combination"), other than a Business Combination in which more than
50% of the combined voting power of the outstanding voting securities of the
surviving or resulting entity immediately following the Business Combination is
held by the persons who, immediately prior to the Business Combination, were the
holders of the Voting Securities; or
(iii) the approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company, or a sale of all or substantially all
of the assets of the Company; or
(iv) individuals who, as of May 28, 1998, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board, provided that any individual becoming a director subsequent to such date
whose election or nomination for election by the Company's stockholders was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a member of
the Incumbent Board.