-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AYgKu0+BL2L1WQ7oT4yk1e9HV+H3U5l5KUd20iBaV4kDfhoEO5ipLIcvYXq2wl4y IDqtCaZaOv9Oq71Qe7hMBw== 0001022408-05-000002.txt : 20050210 0001022408-05-000002.hdr.sgml : 20050210 20050210171404 ACCESSION NUMBER: 0001022408-05-000002 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20050208 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050210 DATE AS OF CHANGE: 20050210 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EPLUS INC CENTRAL INDEX KEY: 0001022408 STANDARD INDUSTRIAL CLASSIFICATION: FINANCE LESSORS [6172] IRS NUMBER: 541817218 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-28926 FILM NUMBER: 05594019 BUSINESS ADDRESS: STREET 1: 400 HERNDON PARKWAY CITY: HERNDON STATE: VA ZIP: 20176 BUSINESS PHONE: 7038345710 MAIL ADDRESS: STREET 1: 400 HERNDON PARKWAY STREET 2: SUITE B CITY: HERNDON STATE: VA ZIP: 20170 FORMER COMPANY: FORMER CONFORMED NAME: MLC HOLDINGS INC DATE OF NAME CHANGE: 19960906 8-K 1 f_8k20050209.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): February 9, 2005 EPLUS INC. ----------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 000-28926 54-1817218 -------------- -------------- -------------- (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 13595 Dulles Technology Drive, Herndon, Virginia 20171-3413 ----------------------------------------------------- (Address, including zip code, of principal executive office) (703) 984-8400 -------------- (Registrant's telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) -1- 1.01 Entry Into a Material Definitive Agreement By an agreement entered into on February 10, 2005, ePlus inc. (the "Company") awarded 41,800 incentive stock options to Phillip G. Norton, Chairman , Chief Executive Officer and President of the Company. By agreements entered into on February 8, 2005, the Company awarded 50,000 incentive stock options to Bruce M. Bowen, Director and Executive Vice President of the Company, 50,000 incentive stock options to Kleyton L. Parkhurst, Senior Vice President, Assistant Secretary, and Treasurer of the Company, and 50,000 incentive stock options to Steven J. Mencarini, Chief Financial Officer and Senior Vice president of the Company. All of the incentive stock options were granted pursuant to the Amended and Restated 1998 Long-Term Incentive Plan. The date of grant for each of the incentive stock option awards was November 16, 2004 at an exercise price of $10.87 per share, except for the grant to Mr. Norton which has an exercise price of $11.96 per share. The incentive stock options vest and become exercisable in five equal installments beginning on the first anniversary of the date of grant. All of the incentive stock options lapse after five years and three months from the date of grant, except for Mr. Norton's incentive stock options, which lapse after five years. By an agreement entered into on February 10, 2005, the Company awarded 258,200 non-qualified stock options to Mr. Norton pursuant to the Amended and Restated 1998 Long-Term Incentive Plan. The date of grant for this award was November 16, 2004 at an exercise price of $10.87 per share. The non-qualified stock options vest and become exercisable in five equal installments beginning on the first anniversary of the date of grant. All of the non-qualified stock options lapse after five years and three months from the date of grant. The awards of incentive stock options and the award of the non-qualified stock options are subject to the terms of the Plan and the individual Incentive Stock Option Agreements and Non-Qualified Stock Option Agreement in Exhibits 10.1, 10.2, 10.3, 10.4 and 10.5 and incorporated by reference herein. The foregoing summary of the terms of the incentive stock option and non-qualified stock option awards are qualified in their entirety by reference to the Plan and the individual award agreements. The Company is also filing herewith the form of incentive stock option agreement and the form of non-qualified stock option agreement used by the Company in connection with stock option and non-qualified stock option grants under the Plan. Item 9.01 Financial Statements and Exhibits 10.1 Incentive Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan by and between the Company and Phillip G. Norton. 10.2 Incentive Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan by and between the Company and Bruce M. Bowen. 10.3 Incentive Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan by and between the Company and Kleyton L. Parkhurst 10.4 Incentive Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan by and between the Company and Steven J. Mencarini. 10.5 Non-Qualified Stock Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan by and between the Company and Phillip G. Norton. 10.6 Form of Incentive Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan. 10.7 Form of Non-Qualified Stock Option Agreement under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan. -2- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. EPLUS INC. Date: February 10, 2005 By: /s/ STEVEN J. MENCARINI ---------------------------- Steven J. Mencarini Chief Financial Officer -3- EX-10 2 f_exhnorton.txt INCENTIVE STOCK OPTION AGREEMENT under the EPLUS, INC. 1998 LONG-TERM INCENTIVE PLAN Optionee: Phillip G. Norton ----------------- Number Shares Subject to Option: 41,800 ------ Exercise Price per Share: 11.96 ------- Date of Grant: November 16, 2004 -------------------- 1. Grant of Option ePlus, Inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus, Inc. (formerly MLC Holdings, Inc.) 1998 Long-Term Incentive Plan (the "Plan"), an Incentive Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant. 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date, but if Option is exercised after the dates specified in paragraphs (b), (c) and (d) below, it will automatically become a Non-Qualified Stock Option: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, on the fifth anniversary of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment is terminated by the Company for cause (as defined below) or by the Optionee without the consent of the Company, the Option shall lapse immediately. (c) If the Optionee's employment terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment. (d) If the Optionee dies while employed, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment (including vesting by acceleration in accordance with Article 14 of the Plan). The term "cause" as used herein shall mean gross neglect of duty, prolonged absence from duty without the consent of the Company, the acceptance by Optionee of a position with another employer without consent, intentionally engaging in any activity which is in conflict with or adverse to the business or other interests of the Company, willful misconduct on the part of Optionee, misfeasance or malfeasance of duty causing a violation of any law which is reasonably determined to be detrimental to the Company, breach of a fiduciary duty owed to the Company or any material breach of an employment contract which has not been corrected by Optionee within (30) days after his receipt of notice of such breach from the Company. 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. Such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee, or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the date of the exercise shall be determined in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. 5. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate the Optionee's employment at any time, nor confer upon the Optionee any right to continue in the employ of the Company or any Subsidiary. 6. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 7. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 8. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution. The Option may be exercised during the lifetime of the Optionee only by the Optionee. 9. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 10. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. -2- 11. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 12. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 13. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus, Inc. 13595 Dulles Technology drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. 14. Interpretation. It is the intent of the parties hereto that the Option qualify for incentive stock option treatment pursuant to, and to the extent permitted by, Section 422 of the Code. All provisions hereof are intended to have, and shall be construed to have, such meanings as are set forth in applicable provisions of the Code and Treasury Regulations to allow the Option to so qualify. Notwithstanding the above, if the Plan is not approved by the Company's stockholders on or before June 30, 1999, the Option will automatically become a Non-Qualified Stock Option, without further act or amendment. IN WITNESS WHEREOF, ePlus, Inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. EPLUS, INC. By:/S/ Steven J. Mencarini ---------------------------- Name: Steven J. Mencarini Title: Executive Vice President Date:February 10, 2005 -------------------------- OPTIONEE: /S/ Phillip G. Norton ------------------------------- Phillip G. Norton Date:February 10, 2005 -------------------------- -3- EX-10 3 f_exhbowen.txt INCENTIVE STOCK OPTION AGREEMENT under the EPLUS, INC. AMENDED AND RESTATED 1998 LONG-TERM INCENTIVE PLAN Optionee: Bruce M. Bowen -------------- Number Shares Subject to Option: 50,000 ------ Exercise Price per Share: 10.87 ------- Date of Grant: November 16, 2004 ---------------------- 1. Grant of Option ePlus, Inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus, Inc. (formerly MLC Holdings, Inc.) Amended and Restated 1998 Long-Term Incentive Plan (the "Plan"), an Incentive Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant. 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date, but if Option is exercised after the dates specified in paragraphs (b), (c) and (d) below, it will automatically become a Non-Qualified Stock Option: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, after five(5) years and three (3) months of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment is terminated by the Company for cause (as defined below) or by the Optionee without the consent of the Company, the Option shall lapse immediately. (c) If the Optionee's employment terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment. (d) If the Optionee dies while employed, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment (including vesting by acceleration in accordance with Article 14 of the Plan). The term "cause" as used herein shall mean gross neglect of duty, prolonged absence from duty without the consent of the Company, the acceptance by Optionee of a position with another employer without consent, intentionally engaging in any activity which is in conflict with or adverse to the business or other interests of the Company, willful misconduct on the part of Optionee, misfeasance or malfeasance of duty causing a violation of any law which is reasonably determined to be detrimental to the Company, breach of a fiduciary duty owed to the Company or any material breach of an employment contract which has not been corrected by Optionee within (30) days after his receipt of notice of such breach from the Company. 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. Such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee, or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the date of the exercise shall be determined in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. 5. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate the Optionee's employment at any time, nor confer upon the Optionee any right to continue in the employ of the Company or any Subsidiary. 6. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 7. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 8. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution. The Option may be exercised during the lifetime of the Optionee only by the Optionee. 9. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 10. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. -2- 11. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 12. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 13. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus, Inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. 14. Interpretation. It is the intent of the parties hereto that the Option qualify for incentive stock option treatment pursuant to, and to the extent permitted by, Section 422 of the Code. All provisions hereof are intended to have, and shall be construed to have, such meanings as are set forth in applicable provisions of the Code and Treasury Regulations to allow the Option to so qualify. Notwithstanding the above, if the Plan is not approved by the Company's stockholders on or before June 30, 1999, the Option will automatically become a Non-Qualified Stock Option, without further act or amendment. IN WITNESS WHEREOF, ePlus, Inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. EPLUS, INC. By:/S/ Steven J. Mencarini ---------------------------- Name: Steven J. Mencarini Title: Senior Vice President Date: February 8, 2005 -------------------------- OPTIONEE: /S/ Bruce M. Bowen ------------------------------- Bruce M. Bowen Date: February 8, 2005 -------------------------- -3- EX-10 4 f_exhparkhurst.txt INCENTIVE STOCK OPTION AGREEMENT under the EPLUS, INC. AMENDED AND RESTATED 1998 LONG-TERM INCENTIVE PLAN Optionee: Kleyton L. Parkhurst -------------------- Number Shares Subject to Option: 50,000 ------ Exercise Price per Share: 10.87 ------- Date of Grant: November 16, 2004 -------------------- 1. Grant of Option ePlus, Inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus, Inc. (formerly MLC Holdings, Inc.) Amended and Restated 1998 Long-Term Incentive Plan (the "Plan"), an Incentive Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant. 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date, but if Option is exercised after the dates specified in paragraphs (b), (c) and (d) below, it will automatically become a Non-Qualified Stock Option: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, after five(5) years and three (3) months of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment is terminated by the Company for cause (as defined below) or by the Optionee without the consent of the Company, the Option shall lapse immediately. (c) If the Optionee's employment terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment. (d) If the Optionee dies while employed, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment (including vesting by acceleration in accordance with Article 14 of the Plan). The term "cause" as used herein shall mean gross neglect of duty, prolonged absence from duty without the consent of the Company, the acceptance by Optionee of a position with another employer without consent, intentionally engaging in any activity which is in conflict with or adverse to the business or other interests of the Company, willful misconduct on the part of Optionee, misfeasance or malfeasance of duty causing a violation of any law which is reasonably determined to be detrimental to the Company, breach of a fiduciary duty owed to the Company or any material breach of an employment contract which has not been corrected by Optionee within (30) days after his receipt of notice of such breach from the Company. 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. Such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee, or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the date of the exercise shall be determined in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. 5. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate the Optionee's employment at any time, nor confer upon the Optionee any right to continue in the employ of the Company or any Subsidiary. 6. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 7. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 8. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution. The Option may be exercised during the lifetime of the Optionee only by the Optionee. 9. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 10. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. -2- 11. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 12. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 13. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus, Inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. 14. Interpretation. It is the intent of the parties hereto that the Option qualify for incentive stock option treatment pursuant to, and to the extent permitted by, Section 422 of the Code. All provisions hereof are intended to have, and shall be construed to have, such meanings as are set forth in applicable provisions of the Code and Treasury Regulations to allow the Option to so qualify. Notwithstanding the above, if the Plan is not approved by the Company's stockholders on or before June 30, 1999, the Option will automatically become a Non-Qualified Stock Option, without further act or amendment. IN WITNESS WHEREOF, ePlus, Inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. EPLUS, INC. By:/S/ Steven J. Mencarini ---------------------------- Name: Steven J. Mencarini Title: Senior Vice President Date: February 8, 2005 ------------------------- OPTIONEE: /S/ Kleyton L. Parkhurst ------------------------------- Kleyton L. Parkhurst Date: February 8, 2005 ------------------------- -3- EX-10 5 f_exhmencarini.txt INCENTIVE STOCK OPTION AGREEMENT under the EPLUS, INC. AMENDED AND RESTATED 1998 LONG-TERM INCENTIVE PLAN Optionee: Steven J. Mencarini ------------------- Number Shares Subject to Option: 50,000 ------ Exercise Price per Share: 10.87 ------- Date of Grant: November 16, 2004 -------------------- 1. Grant of Option ePlus, Inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus, Inc. (formerly MLC Holdings, Inc.) Amended and Restated 1998 Long-Term Incentive Plan (the "Plan"), an Incentive Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date, but if Option is exercised after the dates specified in paragraphs (b), (c) and (d) below, it will automatically become a Non-Qualified Stock Option: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, after five(5) years and three (3) months of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment is terminated by the Company for cause (as defined below) or by the Optionee without the consent of the Company, the Option shall lapse immediately. (c) If the Optionee's employment terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment. (d) If the Optionee dies while employed, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment (including vesting by acceleration in accordance with Article 14 of the Plan). The term "cause" as used herein shall mean gross neglect of duty, prolonged absence from duty without the consent of the Company, the acceptance by Optionee of a position with another employer without consent, intentionally engaging in any activity which is in conflict with or adverse to the business or other interests of the Company, willful misconduct on the part of Optionee, misfeasance or malfeasance of duty causing a violation of any law which is reasonably determined to be detrimental to the Company, breach of a fiduciary duty owed to the Company or any material breach of an employment contract which has not been corrected by Optionee within (30) days after his receipt of notice of such breach from the Company. 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. Such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee, or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the date of the exercise shall be determined in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. 5. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate the Optionee's employment at any time, nor confer upon the Optionee any right to continue in the employ of the Company or any Subsidiary. 6. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 7. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 8. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution. The Option may be exercised during the lifetime of the Optionee only by the Optionee. 9. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 10. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. -2- 11. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 12. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 13. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus, Inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. 14. Interpretation. It is the intent of the parties hereto that the Option qualify for incentive stock option treatment pursuant to, and to the extent permitted by, Section 422 of the Code. All provisions hereof are intended to have, and shall be construed to have, such meanings as are set forth in applicable provisions of the Code and Treasury Regulations to allow the Option to so qualify. Notwithstanding the above, if the Plan is not approved by the Company's stockholders on or before June 30, 1999, the Option will automatically become a Non-Qualified Stock Option, without further act or amendment. IN WITNESS WHEREOF, ePlus, Inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. EPLUS, INC. By:/S/ Bruce M. Bowen ---------------------------- Name: Bruce M. Bowen Title: Executive Vice President Date: February 8, 2005 ------------------------- OPTIONEE: /S/ Steven J. Mencarini ------------------------------- Steven J. Mencarini Date: February 8, 2005 ------------------------- -3- EX-10 6 f_exhnorton2.txt NON-QUALIFIED STOCK OPTION AGREEMENT under the EPLUS INC. AMENDED AND RESTATED 1998 LONG-TERM INCENTIVE PLAN Optionee: Phillip G. Norton -------------------------- Number Shares Subject to Option: 258,200 -------- Exercise Price per Share: $10.87 ------ Date of Grant: November 16, 2004 ------------------------------ 1. Grant of Option. ePlus inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan (the "Plan"), a Non-Qualified Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant. 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, on the fifth year and three month anniversary of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment or service as a director or consultant for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment or service is terminated by the Company for Cause, the Option shall lapse immediately. (c) If the Optionee's employment or service as a director or consultant terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment or service. (d) If the Optionee dies while employed or otherwise in service as a director or consultant, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment or service, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment or service (including vesting by acceleration in accordance with Article 14 of the Plan). 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. If the person exercising the Option is not the Optionee, such person shall also deliver with the notice of exercise appropriate proof of his or her right to exercise the Option. Unless the exercise is a broker-assisted "cashless exercise" as described below, such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee (which shares may be delivered by attestation or actual delivery of one or more certificates), or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the last trading day immediately prior to the exercise date shall be used in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. In such case, the date of exercise shall be deemed to be the date on which notice of exercise is received by the Company and the exercise price shall be delivered to the Company on the settlement date. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. No fractional shares of Stock shall be issued upon exercise of the Option. 5. Beneficiary Designation. The Optionee, by written notice to the Commmittee, may designate one or more persons (and from time to time change such designation) including the Optionee's legal representative, who, by reason of the Optionee's death, shall acquire the right to exercise all or a portion of the Option. If no beneficiary has been designated or survives the Optionee, the Option may be exercised by the personal representative of the Optionee's estate. If the person with exercise rights desires to exercise any portion of the Option, such person must do so in accordance with the terms and conditions of this Agreement and the Plan. 6. Withholding. The Company has the authority and the right to deduct or withhold, or require the Optionee to remit to the Company, an amount sufficient to satisfy federal, state, and local taxes (including the Optionee's FICA obligation) required by law to be withheld with respect to any taxable event arising as a result of the exercise of the Option. Such withholding requirement may be satisfied, in whole or in part, at the election of the Company, by withholding from the Option shares of Stock having a Fair Market Value on the date of withholding equal to the minimum amount (and not any greater amount) required to be withheld for tax purposes, all in accordance with such procedures as the Committee establishes. 7. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Parent or Subsidiary to terminate the Optionee's service at any time, nor confer upon the Optionee any right to continue in the service of the Company or any Parent or Subsidiary. 8. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 9. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 10. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, -2- or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution; provided, however, that the Committee may (but need not) permit other transfers where the Committee concludes that such transferability (i) does not result in accelerated taxation and (ii) is otherwise appropriate and desirable, taking into account any factors deemed relevant, including without limitation, state or federal tax or securities laws applicable to transferable options. The Option may be exercised during the lifetime of the Optionee only by the Optionee or any permitted transferee. 11. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 12. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. 13. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 14. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 15. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. IN WITNESS WHEREOF, ePlus inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. ePlus inc. By:/S/ Steven J. Mencarini ---------------------------- Name: Steven J. Mencarini ------------------- Title: Senior Vice President ------------------------ Date:February 10, 2005 -------------------------- OPTIONEE: /S/ Phillip G. Norton --------------------- Date:February 10, 2005 -------------------------- -3- EXHIBIT A --------- NOTICE OF EXERCISE OF OPTION TO PURCHASE COMMON STOCK OF EPLUS INC. Name: ________________________ Address:________________________ ________________________ Date: ________________________ ePlus inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attention: Secretary Re: Exercise of Non-Qualified Stock Option under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan I elect to purchase ______________ shares of the Common Stock of ePlus inc. ("ePlus") pursuant to my Stock Option Agreement dated ______________. The exercise price of the Option is $_______ per share. The purchase will take place on the Exercise Date, which will be (i) as soon as practicable following the date of this notice and all other necessary forms and payments are received by ePlus, unless I specify a later date (not to exceed 30 days following the date of this notice), or (ii) in the case of a broker-assisted cashless exercise (as indicated below), the date of this notice. I acknowledge that I am not entitled to receive any shares of ePlus Stock until I have (i) paid the exercise price in full and (ii) satisfied my tax withholding obligations, in one of the methods permitted below. 1. Payment of Exercise price. On or before the Exercise Date (or, in the case of a broker-assisted cashless exercise, on the settlement date following the Exercise Date), I will pay the full exercise price in the form specified below (check one): [ ] Cash Only: by delivering a check to ePlus for $___________, which is the full amount of the exercise price. [ ] Cash and Shares: by delivering a check to ePlus for $_________ for part of the exercise price. I will pay the balance of the exercise price by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the balance of the exercise price of the Option. (Such delivery may be made by attestation of my ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of such ePlus Stock so delivered exceeds the number needed to pay the exercise price, ePlus will issue me a new stock certificate for the excess. [ ] Shares Only: by delivering to ePlus shares of ePlus Stock that I have owned for at l east six months, which shares have a Fair Market Value as of the Exercise Date equal to the full exercise price of the Option. (Such delivery may be made by attestation of my ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of such ePlus Stock so delivered exceeds the number needed to pay the exercise price, ePlus will issue me a new stock certificate for the excess. [ ] Cash From Broker: by delivering the exercise price and the required tax withholding amount from ________________________________, a broker, dealer or other "creditor" as defined by Regulation T issued by the Board of Governors of the Federal Reserve System (the "Broker"). I authorize ePlus to (i) create an account for me with the Broker into which the Option shares shall be delivered, (ii) issue a stock certificate in my name for the number of shares indicated above, and (iii) deliver such stock certificate directly to the Broker for deposit into my account upon receiving the exercise price and the required tax withholding amount from the Broker. 2. Withholding Taxes. On or before the Exercise Date, I will satisfy my tax withholding obligations in the form specified below (check one): [ ] Cash Only: by delivering a check to ePlus for the full tax withholding amount. [ ] Cash and Shares: by delivering a check to ePlus for part of the tax withholding amount. I will pay the balance of the tax withholding amount by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the balance of the required tax withholding amount. (Such delivery may be made by attestation of my ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.)If the number of shares of ePlus Stock so delivered exceeds the number needed to pay the tax withholding amount, ePlus will issue me a new stock certificate for the excess. [ ] Shares Only: by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the required tax withholding amount. (Such delivery may be made by attestation of ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of ePlus Stock so delivered exceeds the number needed to pay the tax withholding amount, ePlus will issue me a new stock certificate for the excess. [ ] Withholding of Shares to Cover Minimum Obligation: by having ePlus withhold shares of Stock from the Option having a Fair Market Value on the date of withholding equal to the minimumm amount (and not any greater amount) required to be withheld for tax purposes. [ ] Cash From Broker: I elected under Paragraph 1 of this notice to pay BOTH the exercise price of the Option and the required tax withholding amount in a broker-assisted cashless exercise. Please deliver the stock certificate to me (unless I have chosen to pay the exercise price and tax withholding through a broker). Very truly yours, -------------------- AGREED TO AND ACCEPTED: ePlus inc. -5- By: _____________________________________ Title: __________________________________ Number of Option Shares Exercised: ______________________________ Number of Option Shares Remaining: ______________________________ Date: ___________________________________ -6- EX-10 7 f_exhincentive.txt INCENTIVE STOCK OPTION AGREEMENT under the EPLUS, INC. AMENDED AND RESTATED 1998 LONG-TERM INCENTIVE PLAN Optionee: Number Shares Subject to Option: Exercise Price per Share: Date of Grant: 1. Grant of Option ePlus, Inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus, Inc. (formerly MLC Holdings, Inc.) Amended and Restated 1998 Long-Term Incentive Plan (the "Plan"), an Incentive Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date, but if Option is exercised after the dates specified in paragraphs (b), (c) and (d) below, it will automatically become a Non-Qualified Stock Option: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, after five(5) years and three (3) months of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment is terminated by the Company for cause (as defined below) or by the Optionee without the consent of the Company, the Option shall lapse immediately. (c) If the Optionee's employment terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment. (d) If the Optionee dies while employed, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment (including vesting by acceleration in accordance with Article 14 of the Plan). The term "cause" as used herein shall mean gross neglect of duty, prolonged absence from duty without the consent of the Company, the acceptance by Optionee of a position with another employer without consent, intentionally engaging in any activity which is in conflict with or adverse to the business or other interests of the Company, willful misconduct on the part of Optionee, misfeasance or malfeasance of duty causing a violation of any law which is reasonably determined to be detrimental to the Company, breach of a fiduciary duty owed to the Company or any material breach of an employment contract which has not been corrected by Optionee within (30) days after his receipt of notice of such breach from the Company. 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. Such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee, or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the date of the exercise shall be determined in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. 5. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate the Optionee's employment at any time, nor confer upon the Optionee any right to continue in the employ of the Company or any Subsidiary. 6. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 7. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 8. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution. The Option may be exercised during the lifetime of the Optionee only by the Optionee. 9. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 10. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. -2- 11. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 12. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 13. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus, Inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. 14. Interpretation. It is the intent of the parties hereto that the Option qualify for incentive stock option treatment pursuant to, and to the extent permitted by, Section 422 of the Code. All provisions hereof are intended to have, and shall be construed to have, such meanings as are set forth in applicable provisions of the Code and Treasury Regulations to allow the Option to so qualify. Notwithstanding the above, if the Plan is not approved by the Company's stockholders on or before June 30, 1999, the Option will automatically become a Non-Qualified Stock Option, without further act or amendment. IN WITNESS WHEREOF, ePlus, Inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. EPLUS, INC. By:____________________________ Name: Title: Date:__________________________ OPTIONEE: _______________________________ Date:__________________________ -3- EX-10 8 f_exhnonqual.txt Non-Qualified STOCK OPTION AGREEMENT under the EPLUS INC. AMENDED AND RESTATED 1998 LONG-TERM INCENTIVE PLAN Optionee: ______________________________________________ Number Shares Subject to Option:________________________ Exercise Price per Share:_______________________________ Date of Grant:__________________________________________ 1. Grant of Option. ePlus inc. (the "Company") hereby grants to the Optionee named above (the "Optionee"), under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan (the "Plan"), a Non-Qualified Stock Option to purchase, on the terms and conditions set forth in this agreement (this "Option Agreement"), the number of shares indicated above of the Company's $0.01 par value common stock (the "Stock"), at the exercise price per share set forth above (the "Option"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned such terms in the Plan. 2. Vesting of Option. Unless the exercisability of the Option is accelerated in accordance with Article 14 of the Plan, the Option shall vest (become exercisable) 20% on the first anniversary of the date of grant, 20% on the second anniversary of the date of grant, and 20% on the third anniversary of the date of grant, 20% on the fourth anniversary and 20% on the fifth anniversary of the date of grant. 3. Period of Option and Limitations on Right to Exercise. The Option will, to the extent not previously exercised, lapse under the earliest of the following circumstances; provided, however, that the Committee may, prior to the lapse of the Option under the circumstances described in paragraphs (b), (c) and (d) below, provide in writing that the Option will extend until a later date: (a) The Option shall lapse as of 5:00 p.m., Eastern Time, on the fifth year and three month anniversary of the date of grant (the "Expiration Date"). (b) The Option shall lapse three months after the Optionee's termination of employment or service as a director or consultant for any reason other than the Optionee's death or Disability; provided, however, that if the Optionee's employment or service is terminated by the Company for Cause, the Option shall lapse immediately. (c) If the Optionee's employment or service as a director or consultant terminates by reason of Disability, the Option shall lapse one year after the date of the Optionee's termination of employment or service. (d) If the Optionee dies while employed or otherwise in service as a director or consultant, or during the three-month period described in subsection (b) above or during the one-year period described in subsection (c) above and before the Option otherwise lapses, the Option shall lapse one year after the date of the Optionee's death. Upon the Optionee's death, the Option may be exercised by the Optionee's beneficiary. If the Optionee or his beneficiary exercises an Option after termination of employment or service, the Option may be exercised only with respect to the shares that were otherwise vested on the Optionee's termination of employment or service (including vesting by acceleration in accordance with Article 14 of the Plan). 4. Exercise of Option. The Option shall be exercised by written notice directed to the Secretary of the Company at the principal executive offices of the Company, in substantially the form attached hereto as Exhibit A, or such other form as the Committee may approve. If the person exercising the Option is not the Optionee, such person shall also deliver with the notice of exercise appropriate proof of his or her right to exercise the Option. Unless the exercise is a broker-assisted "cashless exercise" as described below, such written notice shall be accompanied by full payment in cash, shares of Stock previously acquired by the Optionee (which shares may be delivered by attestation or actual delivery of one or more certificates), or any combination thereof, for the number of shares specified in such written notice; provided, however, that if shares of Stock are used to pay the exercise price, such shares must have been held by the Optionee for at least six months. The Fair Market Value of the surrendered Stock as of the last trading day immediately prior to the exercise date shall be used in valuing Stock used in payment of the exercise price. To the extent permitted under Regulation T of the Federal Reserve Board, and subject to applicable securities laws, the Option may be exercised through a broker in a so-called "cashless exercise" whereby the broker sells the Option shares and delivers cash sales proceeds to the Company in payment of the exercise price. In such case, the date of exercise shall be deemed to be the date on which notice of exercise is received by the Company and the exercise price shall be delivered to the Company on the settlement date. Subject to the terms of this Option Agreement, the Option may be exercised at any time and without regard to any other option held by the Optionee to purchase stock of the Company. No fractional shares of Stock shall be issued upon exercise of the Option. 5. Beneficiary Designation. The Optionee, by written notice to the Commmittee, may designate one or more persons (and from time to time change such designation) including the Optionee's legal representative, who, by reason of the Optionee's death, shall acquire the right to exercise all or a portion of the Option. If no beneficiary has been designated or survives the Optionee, the Option may be exercised by the personal representative of the Optionee's estate. If the person with exercise rights desires to exercise any portion of the Option, such person must do so in accordance with the terms and conditions of this Agreement and the Plan. 6. Withholding. The Company has the authority and the right to deduct or withhold, or require the Optionee to remit to the Company, an amount sufficient to satisfy federal, state, and local taxes (including the Optionee's FICA obligation) required by law to be withheld with respect to any taxable event arising as a result of the exercise of the Option. Such withholding requirement may be satisfied, in whole or in part, at the election of the Company, by withholding from the Option shares of Stock having a Fair Market Value on the date of withholding equal to the minimum amount (and not any greater amount) required to be withheld for tax purposes, all in accordance with such procedures as the Committee establishes. 7. Limitation of Rights. The Option does not confer to the Optionee or the Optionee's personal representative any rights of a shareholder of the Company unless and until shares of Stock are in fact issued to such person in connection with the exercise of the Option. Nothing in this Option Agreement shall interfere with or limit in any way the right of the Company or any Parent or Subsidiary to terminate the Optionee's service at any time, nor confer upon the Optionee any right to continue in the service of the Company or any Parent or Subsidiary. 8. Stock Reserve. The Company shall at all times during the term of this Option Agreement reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of this Option Agreement. 9. Optionee's Covenant. The Optionee hereby agrees to use his best efforts to provide services to the Company in a workmanlike manner and to promote the Company's interests. 10. Restrictions on Transfer and Pledge. The Option may not be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Parent or Subsidiary, or be subject to any lien, obligation, or liability of the Optionee to any other party other than the Company or a Parent or Subsidiary. The Option is not assignable or transferable by the Optionee other than by will or the laws of descent and distribution; provided, however, that the Committee may (but need not) permit other transfers where the Committee concludes that such transferability (i) does not result in accelerated taxation and (ii) is otherwise appropriate and desirable, taking into account any factors deemed relevant, including without limitation, state or federal tax or securities laws applicable to transferable options. The Option may be exercised during the lifetime of the Optionee only by the Optionee or any permitted transferee. -2- 11. Restrictions on Issuance of Shares. If at any time the Board shall determine in its discretion, that listing, registration or qualification of the shares of Stock covered by the Option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to the exercise of the Option, the Option may not be exercised in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 12. Plan Controls. The terms contained in the Plan are incorporated into and made a part of this Option Agreement and this Option Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Option Agreement, the provisions of the Plan shall be controlling and determinative. 13. Successors. This Option Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Option Agreement and the Plan. 14. Severability. If any one or more of the provisions contained in this Option Agreement are invalid, illegal or unenforceable, the other provisions of this Option Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included. 15. Notice. Notices and communications under this Option Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to: ePlus inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attn: Secretary or any other address designated by the Company in a written notice to the Optionee. Notices to the Optionee will be directed to the address of the Optionee then currently on file with the Company, or at any other address given by the Optionee in a written notice to the Company. IN WITNESS WHEREOF, ePlus inc., acting by and through its duly authorized officers, has caused this Option Agreement to be executed, and the Optionee has executed this Option Agreement, all as of the day and year first above written. ePlus inc. By:__________________________________________ Name: Title: Date:________________________________________ OPTIONEE:____________________________________ Date:________________________________________ EXHIBIT A NOTICE OF EXERCISE OF OPTION TO PURCHASE COMMON STOCK OF EPLUS INC. Name: __________________________ Address: __________________________ Date: __________________________ ePlus inc. 13595 Dulles Technology Drive Herndon, VA 20171 Attention: Secretary Re: Exercise of Non-Qualified Stock Option under the ePlus inc. Amended and Restated 1998 Long-Term Incentive Plan I elect to purchase ______________ shares of the Common Stock of ePlus inc. ("ePlus") pursuant to my Stock Option Agreement dated ______________. The exercise price of the Option is $_______ per share. The purchase will take place on the Exercise Date, which will be (i) as soon as practicable following the date of this notice and all other necessary forms and payments are received by ePlus, unless I specify a later date (not to exceed 30 days following the date of this notice), or (ii) in the case of a broker-assisted cashless exercise (as indicated below), the date of this notice. I acknowledge that I am not entitled to receive any shares of ePlus Stock until I have (i) paid the exercise price in full and (ii) satisfied my tax withholding obligations, in one of the methods permitted below. 1. Payment of Exercise Price. On or before the Exercise Date (or, in the case of a broker-assisted cashless exercise, on the settlement date following the Exercise Date), I will pay the full exercise price in the form specified below (check one): [ ] Cash Only: by delivering a check to ePlus for $___________, which is the full amount of the exercise price. [ ] Cash and Shares: by delivering a check to ePlus for $_________ for part of the exercise price. I will pay the balance of the exercise price by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the balance of the exercise price of the Option. (Such delivery may be made by attestation of my ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of such ePlus Stock so delivered exceeds the number needed to pay the exercise price, ePlus will issue me a new stock certificate for the excess. [ ] Shares Only: by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the full exercise price of the Option. (Such delivery may be made by attestation of my ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of s uch ePlus Stock so delivered exceeds the number needed to pay the exercise price, ePlus will issue me a new stock certificate for the excess. [ ] Cash From Broker: by delivering the exercise price and the required tax withholding amount from ________________________________, a broker, dealer or other "creditor" as defined by Regulation T issued by the Board of Governors of the Federal Reserve System (the "Broker"). I authorize ePlus to (i) create an account for me with the Broker into which the Option shares shall be delivered, (ii) issue a stock certificate in my name for the number of shares indicated above, and (iii) deliver such stock certificate directly to the Broker for deposit into my account upon receiving the exercise price and the required tax withholding amount from the Broker. 2. Withholding Taxes. On or before the Exercise Date, I will satisfy my tax withholding obligations in the form specified below (check one): [ ] Cash Only: by delivering a check to ePlus for the full tax withholding amount. [ ] Cash and Shares: by delivering a check to ePlus for part of the tax withholding amount. I will pay the balance of the tax withholding amount by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the balance of the required tax withholding amount. (Such delivery may be made by attestation of my ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of ePlus Stock so delivered exceeds the number needed to pay the tax withholding amount, ePlus will issue me a new stock certificate for the excess. [ ] Shares Only: by delivering to ePlus shares of ePlus Stock that I have owned for at least six months, which shares have a Fair Market Value as of the Exercise Date equal to the required tax withholding amount. (Such delivery may be made by attestation of ownership or by actual delivery of one or more stock certificates duly endorsed for transfer.) If the number of shares of ePlus Stock so delivered exceeds the number needed to pay the tax withholding amount, ePlus will issue me a new stock certificate for the excess. [ ] Withholding of Shares to Cover Minimum Obligation: by having ePlus withhold shares of Stock from the Option having a Fair Market Value on the date of withholding equal to the minimum amount (and not any greater amount) required to be withheld for tax purposes. [ ] Cash From Broker: I elected under Paragraph 1 of this notice to pay BOTH the exercise price of the Option and the required tax withholding amount in a broker-assisted cashless exercise. Please deliver the stock certificate to me (unless I have chosen to pay the exercise price and tax withholding through a broker). Very truly yours, _________________ AGREED TO AND ACCEPTED: ePlus inc. -5- By: ___________________________________ Title: __________________________________ Number of Option Shares Exercised: ______________________________ Number of Option Shares Remaining: _____________________________ Date: _________________________________ -6- -----END PRIVACY-ENHANCED MESSAGE-----