-----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, PVFHAU18O0plBekhRjBGN08lvI/q2IHcLQtbbmZh5HoyQh6Kr0KwHkb/Xbdm43Xd Go0ZW68boFnh9g/A/nIThg== 0000947871-97-000170.txt : 19970927 0000947871-97-000170.hdr.sgml : 19970927 ACCESSION NUMBER: 0000947871-97-000170 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19970919 EFFECTIVENESS DATE: 19970919 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SYNETIC INC CENTRAL INDEX KEY: 0000850436 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS PRODUCTS, NEC [3089] IRS NUMBER: 222975182 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-36041 FILM NUMBER: 97683249 BUSINESS ADDRESS: STREET 1: 669 RIVER DRIVE CITY: ELMWOOD PARK STATE: NJ ZIP: 07407 BUSINESS PHONE: 2017033400 MAIL ADDRESS: STREET 1: 669 RIVER DRIVE CITY: ELMWOOD PARK STATE: NJ ZIP: 07407 S-8 1 FORM S-8 REGISTRATION STATEMENT As filed with the Securities and Exchange Commission on September 19, 1997 Registration No. 333- ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------- SYNETIC, INC. (Exact name of Registrant as specified in its charter) Delaware 22-2975182 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 669 River Drive Elmwood Park, New Jersey 07407-1361 (Address of Principal Executive Offices) SYNETIC, INC. 1996 CLASS C STOCK OPTION PLAN SYNETIC, INC. 1997 CLASS D STOCK OPTION PLAN SYNETIC, INC. 1991 SPECIAL NON-QUALIFIED STOCK OPTION PLAN (Full title of the plan) ------------------------- CHARLES E. MELE, ESQ. Vice President - General Counsel Synetic, Inc. 669 River Drive Elmwood Park, New Jersey 07407-1361 (Name and address of agent for service) (201) 703-3400 (Telephone number, including area code, of agent for service) ------------------------- CALCULATION OF REGISTRATION FEE
=============================================================================================================== Title of Amount Proposed Maximum Proposed Maximum Amount of Securities to be to be Offering Price Per Aggregate Registration Registered Registered Share Offering Price Fee - ---------------------------------------------------------------------------------------------------------------
Common Stock (1) (1) par value $.01 per share 77,000 Shares $ 23.25 $ 1,790,250 $ 543 23,400 Shares $ 24.50 $ 573,300 $ 174 47,250 Shares $ 31.25 $ 1,476,563 $ 448 495,000 Shares $ 32.25 $ 15,963,750 $ 4,838 5,000 Shares $ 32.75 $ 163,750 $ 50 3,000 Shares $ 33.25 $ 99,750 $ 31 225,000 Shares $ 35.50 $ 7,987,500 $ 2,421 385,000 Shares $ 36.50 $ 14,052,500 $ 4,259 175,000 Shares $ 46.88 $ 8,204,000 $ 2,487 818,182 Shares $ 47.50 $ 38,863,645 $11,777 480,000 Shares $ 52.56 $ 25,228,800 $ 7,646 (2) (2) 31,818 Shares $ 40.19 $ 1,278,766 $ 388 ------------------------------------------------------------------------------- Total 2,765,650 Shares $115,682,574 $35,062 ============================================================================================================ (1) Pursuant to Rule 457(h), offering prices for 2,733,832 shares of Common Stock are based on the per share option exercise price. (2) Pursuant to Rule 457(c) and Rule 457(h), offering prices are based on $40.19 per share for 31,818 shares based on the average of the high and low prices of Common Stock on the Nasdaq consolidated reporting system on September 15, 1997, and is estimated solely for the purpose of calculating the registration fee.
2 Part I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS Item 1. Plan Information.* Item 2. Registrant Information and Employee Plan Annual Information.* - -------------------- * Information required by Part I to be contained in the Section 10(a) prospectus is omitted from this Registration Statement in accordance with Rule 428 under the Securities Act of 1933, as amended (hereinafter, the "Securities Act"), and the "Note" to Part I of Form S-8. 3 PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. The following documents filed with the Securities and Exchange Commission (the "Commission") are incorporated as of their respective dates in this Registration Statement by reference: (i) the annual report on Form 10-K for Synetic, Inc., a Delaware corporation (the "Registrant"), for the fiscal year ending June 30, 1996; (ii) the Registrant's quarterly report on Form 10-Q for the period ended March 31, 1997; and (iii) the description of the common stock, par value $0.01 per share, contained in the Registrant's Registration Statement on Form S-1 (File No. 33-43577) filed with the Commission on November 1, 1991 for registration of common stock under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All documents filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, are incorporated by reference in this Registration Statement and are a part hereof from the date of filing such documents. Item 4. Description of Securities. Not applicable. Item 5. Interests of Named Experts and Counsel. Not applicable. Item 6. Indemnification of Directors and Officers. Section 145 of the General Corporation Law of the State of Delaware (the "DGCL") provides, in summary, that directors and officers of Delaware corporations such as the Registrant are entitled, under certain circumstances, to be indemnified against all expenses and liabilities (including attorneys' fees) incurred by them as a result of suits brought against them in their capacity as a director or officer if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the Registrant and, with respect to any criminal action or proceeding, if they had no reasonable cause to believe their conduct was unlawful; provided that no indemnification may be made against expenses in respect of any claim, issue or matter as to which they shall have been adjudged to be liable to the Registrant, unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, they are fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper. Any such indemnification may be made by the company only as authorized in each specific case upon a determination by the stockholders or disinterested directors that indemnification is proper because the indemnitee has met the applicable standard of conduct. Article Eleven of the Registrant's Certificate of Incorporation and Section 6.5 of the Registrant's By-Laws entitles officers, directors and controlling persons of 4 the Registrant to indemnification to the full extent permitted by Section 145 of the DGCL, as the same may be supplemented or amended from time to time. Article Thirteen of the Registrant's Certificate of Incorporation provides that no director shall have any personal liability to the Registrant or its stockholders for any monetary damages for breach of fiduciary duty as a director, provided that such provision does not limit or eliminate the liability of any director (i) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL (involving certain unlawful dividends or stock repurchase) or (iv) for any transaction from which such director derived an improper personal benefit. Amendment to such article does not affect the liability of any director for any act or omission occurring prior to the effective time of such amendment. Reference is made to Section 7 of the form of Standby Agreement to be included as Exhibit 1.1 hereto, which provides certain indemnification rights to the directors and officers of the Registrant with respect to information by or on behalf of the Purchasers for use in this Registration Statement. Reference is made to the Form of Indemnification Agreement between the Registrant and its directors and officers filed as Exhibit 10.6 to this Registration Statement pursuant to which the registrant has agreed to indemnify such directors and officers to the fullest extent permitted by Delaware law, as the same may be amended from time to time. Item 7. Exemption from Registration Claimed. Not applicable. Item 8. Exhibits See Exhibit Index on page 8. Item 9. Undertakings. (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made of securities registered hereby, a post-effective amendment to this Registration Statement to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Registrant hereby further undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange Act that is incorporated by reference in the Registration Statement shall be deemed to be a 5 new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. 6 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requiremetns for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Elmwood Park, in the State of New Jersey, on the 19th day of September, 1997. SYNETIC, INC. By: /s/ Anthony Vuolo --------------------------------- Name: Anthony Vuolo Title: Vice President-Finance Chief Financial Officer POWER OF ATTORNEY Each of the undersigned whose signature appears below hereby constitutes and appoints Charles A. Mele his/her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him/her and in his/her name, place and stead, in any and all capacities to sign any and all amendments (including post-effective amendments) and supplements to this Registration Statement and any and all related registration statements necessary to register additional securities, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he/she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his/her substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the indicated capacities on September 19, 1997. Signature Title --------- ----- /s/ Martin J. Wygod Chairman of the Board - -------------------------------- (Martin J. Wygod) /s/ James V. Manning President and Chief Executive Officer - -------------------------------- (James V. Manning) Vice President - Finance and /s/ Anthony Vuolo Chief Financial Officer - -------------------------------- (Anthony Vuolo) /s/ Thomas R. Ferguson Director - -------------------------------- Thomas R. Ferguson) /s/ Mervyn L. Goldstein Director - -------------------------------- (Mervyn L. Goldstein) /s/ Ray E. Hannah Director - -------------------------------- (Ray E. Hannah) /s/ Roger H. Licht Director - -------------------------------- (Roger H. Licht) /s/ Charles A. Mele Director - -------------------------------- (Charles A. Mele) /s/ Herman Sarkowsky Director - -------------------------------- (Herman Sarkowsky) /s/ Paul C. Suthern Director - -------------------------------- (Paul C. Suthern) /s/ Albert M. Weis Director - -------------------------------- (Albert M. Weis) 8 Exhibit Index Exhibit No. Description of Document The following exhibits are filed as part of this Registration Statement: Exhibit No. Description of Document 4.1 Synetic, Inc. 1996 Class C Stock Option Plan. 4.2 Synetic, Inc. 1997 Class D Stock Option Plan. 4.3 Synetic, Inc. 1991 Special Non-Qualified Stock Option Plan 5 Opinion of Shearman & Sterling, counsel to the Registrant as to the legality of the securities registered hereby. 23.1 Consent of Arthur Andersen & Co. 23.2 Consent of Kegler, Brown, Hill & Ritter, Co., L.P.A. 23.3 Consent of Shearman & Sterling (included in Exhibit 5). 24 Powers of Attorney (included on signature page). EX-4.1 2 CLASS C STOCK OPTION PLAN SYNETIC, INC. 1996 CLASS C STOCK OPTION PLAN 1. Purpose. The purposes of the Synetic, Inc. 1996 Class C Stock Option Plan (the "Plan") are to attract, retain and motivate officers, Key Employees (as defined below) and consultants of Avicenna Systems Corp., a Massachusetts corporation ("Avicenna"), and its Subsidiaries and to provide to such persons incentives and rewards for superior performance. 2. Definitions. As used in the Plan the following terms have the following meanings: (a) "Award" means an Option. (b) "Board" means the Board of Directors of the Company. (c) "Cause" means a termination of the Participant's employment or status as a consultant with the Company or any of its Subsidiaries (a) for "cause" as defined in an employment agreement or consulting agreement applicable to the Participant, or (b) in the case of a Participant who does not have an employment agreement or consulting agreement that defines "cause", because of any of the following, each as communicated to the Participant by notice from Avicenna setting forth in reasonable detail the nature of such Cause: 1. A failure of the Participant to perform his employment-related duties in any material respect (other than any such failure resulting from a Permanent Disability of the Participant); 2. Any willful misconduct by the Participant relating, directly or indirectly, to the Company, Avicenna or any of their respective Subsidiaries or affiliates, or any breach by the Participant of any material policy of the Company, Avicenna or any of their respective Subsidiaries or affiliates, as reasonably determined by the Committee; 3. Any breach by the Participant of any of the restrictive covenants set forth in the applicable Agreement or any substantially similar provisions in any other agreements with the Company, Avicenna or any of their respective Subsidiaries or affiliates, as reasonably determined by the Committee; or 4. Any willful violation by the Participant of any federal or state law or regulation applicable to the business of the Company, Avicenna or any of their respective Subsidiaries or affiliates, or the Participant's commission of a common law fraud or conviction of a felony or crime involving moral turpitude. 2 (d) "Code" means the Internal Revenue Code of 1986, as amended. (e) "Committee" means a committee of the Board comprised of at least two directors selected by the Board to administer the Plan. (f) "Common Share" means a share of common stock, $.01 par value, of the Company. (g) "Company" means Synetic, Inc., a Delaware corporation. (h) "Date of Grant" means the date on which an Option is granted, as determined by the Committee and as set forth in the applicable Agreement. (i) "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder. (j) "Fair Market Value" of a Common Share on a given date means the closing price of a Common Share on such date (or the most recent trading date if such date is not a trading date) on the NASDAQ/National Market System or such national exchange, if any, as may be designated by the Committee. (k) "Key Employee" means a person employed by Avicenna or one of its Subsidiaries on a full-time basis (including officers) or, with the consent of the Committee, on a part-time basis, who are compensated for such employment by a regular salary. (l) "Option Price" means the purchase price per Common Share payable on exercise of an Option, as determined by the Committee (subject to the terms of the Plan) and as set forth in the applicable Agreement. (m) "Option" means the right to purchase a Common Share upon exercise of a nonqualified stock option granted pursuant to the Plan. (n) "Participant" means a person to whom an Award has been made by the Committee in its sole discretion and who is at the time of such Award an officer, Key Employee, or consultant of Avicenna or any of its Subsidiaries. (o) A Participant shall be deemed to be "Permanently Disabled" if (i) such Participant shall become ill, mentally or physically disabled, or otherwise incapacitated so as to be unable regularly to perform the duties of his position for a period in excess of 90 consecutive days or more than 120 days in any consecutive 12 month period, or (ii) a duly licensed physician selected by the Company or Avicenna with the reasonable approval of the Participant determines that the Participant is mentally or physically disabled so as to be unable 3 to perform regularly the duties of his position and such condition is expected to be of a permanent duration. (p) "Rule 16b-3" means Rule 16b-3 under the Exchange Act. (q) "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations thereunder. (r) "Subsidiary" means any corporation in which the Company owns or controls, directly or indirectly, not less than 50% of the total combined voting power represented by all classes of stock issued by such corporation. (s) "Vested Options" means, as of any date, Options which by their terms are exercisable on such date. 3. Administration of the Plan. (a) The Plan shall be administered, and Awards shall be granted hereunder, by the Board or, if the Board so elects, by the Committee. A majority of the Committee shall constitute a quorum, and the action of the members of the Committee present at any meeting at which a quorum is present, or acts unanimously approved in writing, shall be the acts of the Committee. In the event that the Board does not elect to appoint a Committee then, for purposes of administering the Plan, the term "Board" shall be substituted for the term "Committee" wherever it appears in the Plan. (b) The interpretation and construction by the Committee of any provision of the Plan or of any Agreement, and any determination by the Committee pursuant to any provision of this Plan or of any Agreement shall be final and conclusive. No member of the Committee shall be liable for any such action or determination made in good faith. 4. Shares Available Under Plan. The maximum number of Common Shares which may be issued upon the exercise of Options granted under the Plan is 800,000 Common Shares, subject to adjustment as provided in Paragraph 10. Such shares may be shares of original issuance or treasury shares or a combination of the foregoing. Any Common Shares which are subject to Options which expire or which have been surrendered without being exercised in full shall again be available for issuance under the Plan. 5. Options. The Committee may, from time to time and upon such terms and conditions as it may determine, authorize the granting to Participants of Options. 6. Agreement. The terms and conditions of each Option shall be embodied in a written agreement (the "Agreement") in a form approved by the Committee which shall contain terms and conditions not inconsistent with the Plan and which shall incorporate the Plan by reference. Options granted under the Plan shall comply with the following terms and conditions: 4 (i) Each Agreement shall specify the number of Common Shares for which Options have been granted. (ii) Each Agreement shall specify the Option Price, which shall not be less than the Fair Market Value per Common Share on the Date of Grant. (iii) Each Agreement shall specify that the Option Price shall be payable in cash or by certified or official bank check. If determined by the Committee in its sole discretion and specified in the applicable Agreement, the Option Price shall also be payable (a) by the transfer to the Company of Common Shares having an aggregate Fair Market Value per Common Share at the date of exercise equal to the aggregate Option Price or (b) by a combination of the foregoing methods of payment. (iv) Each Agreement shall specify the applicable vesting schedule and the effective term of the Option. (v) Options granted under the Plan are not intended to qualify as "incentive stock options" within the meaning of Section 422 of the Code. (vi) No Option shall be exercisable more than ten years from the Date of Grant. (vii) Each Option granted under the Plan shall be subject to such additional terms and conditions, not inconsistent with the Plan, which are prescribed by the Committee and set forth in the applicable Agreement. (viii) As soon as practicable following the exercise of any Options, a certificate evidencing the number of Common Shares issued in connection with such exercise shall be issued in the name of the Participant. (ix) As a condition to the exercise of an Option, a Participant shall satisfy any outstanding indebtedness or liability of the Participant to the Company, Avicenna or any of the respective Subsidiaries or affiliates, unless determined otherwise by the Committee in its sole discretion. 7. Date of Exercise. An Option shall be exercisable at the times specified by the Committee in the applicable Agreement. The Committee may also determine that an Option shall become exercisable in full or in part, whether or not it is then exercisable, upon such circumstances or events as the Committee determines, in its sole discretion, merit special consideration. 8. Termination of Employment. (a) In the event that a Participant's employment or status as a consultant 5 with the Company or any of its Subsidiaries terminates for any reason (other than a termination by the Company or any of its Subsidiaries for Cause), the Participant (or the Participant's estate) shall be entitled to exercise the Participant's Options which have become Vested Options as of the date of termination for a period of 30 days (60 days in the event of Permanent Disability and 180 days in the event of death) following the date of termination. (b) In the event that a Participant's employment or status as a consultant with the Company or any of its Subsidiaries terminates for any reason, any Options which have not become Vested Options as of the date of termination shall terminate and be cancelled without any consideration being paid therefor. (c) In the event that a Participant's employment or status as a consultant with the Company or any of its Subsidiaries is terminated for Cause (as determined by the Committee in its sole discretion, which determination shall be conclusive), then all of such Participant's Options (whether or not Vested Options) shall terminate and be cancelled without any consideration being paid therefor. (d) In the event that (i) a Participant's employment with the Company or any of its Subsidiaries terminates for any reason (other than a termination by the Company or any of its Subsidiaries for Cause) and (ii) such Participant is retained as a consultant to the Company or any of its Subsidiaries immediately following such termination of employment, then, in the sole discretion of the Committee, such Participant's employment with the Company and its Subsidiaries shall be deemed to continue for purposes of this Section 8 (and any restrictive covenants applicable to the Participant, including, without limitation, the restrictive covenants set forth in the applicable Agreement) until the termination of such Participant's status as a consultant or such earlier date as may be determined by the Committee in its sole discretion. 9. Transferability. No Option shall be transferable by a Participant other than by will or the laws of descent and distribution. Options shall be exercisable during the Participant's lifetime only by the Participant or by the Participant's guardian or legal representative. 10. Adjustments. The Committee may make or provide for such adjustments in the maximum number of Common Shares specified in Section 4, in the number of Common Shares covered by outstanding Options granted hereunder, and/or in the Option Price applicable to such Options as the Committee in its sole discretion may determine is equitably required to prevent dilution or enlargement of the rights of Participants that otherwise would result from any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, merger, consolidation, spin-off, reorganization, partial or complete liquidation, issuance of rights or warrants to purchase securities or any other corporate transaction or event having an effect similar to any of the foregoing. 6 11. Reorganization. In the event that the Company is merged or consolidated with another corporation, or in the event of a reorganization, separation, or liquidation of the Company, the Board or the board of directors of any corporation assuming the obligations of the Company hereunder may either (i) make appropriate provisions for the protection of any outstanding Options by the substitution on an equitable basis of appropriate securities of the Company, or appropriate securities of the merged, consolidated, or otherwise reorganized corporation, or the appropriate adjustment in the Option Price, or both, or (ii) give written notice to the Participants that their Options must be exercised, to the extent then exercisable, within 60 days of the date of such notice or the Options will terminate. 12. Restrictive Covenants. The applicable Agreement may set forth certain restrictive covenants applicable to the Participant, as determined by the Committee in its sole discretion. 13. Fractional Shares. The Company shall not be required to issue any fractional Common Share pursuant to the Plan. The Committee may provide for the elimination of fractions or for the settlement of fractions in cash. 14. Withholding Taxes. The Company and its Subsidiaries shall have the right to require any individual entitled to receive Common Shares pursuant to an Option to remit to the Company, prior to the delivery of any certificates evidencing such shares, any amount sufficient to satisfy any United States federal, state or local tax withholding requirements. With the consent of the Committee in its sole discretion, prior to the Company's determination of such withholding liability, such individual may make an irrevocable election to satisfy, in whole or in part, such obligation to remit taxes by directing the Company to withhold Common Shares that would otherwise be received by such individual. Such election may be denied by the Committee in its sole discretion, or may be made subject to certain conditions specified by the Committee, including, without limitation, conditions intended to avoid the imposition of liability against the individual under Section 16(b) of the Exchange Act. 15. Registration Restrictions, Exchange Rules. An Option shall not be exercisable unless and until (i) a registration statement under the Securities Act has been duly filed and declared effective pertaining to the Common Shares subject to such Option and such Common Shares shall have been qualified under applicable state "blue sky" laws, or (ii) the Committee in its sole discretion determines that such registration and qualification are not required as a result of the availability of an exemption from such registration and qualification under such laws. Any and all grants of Options shall be subject to all applicable rules and regulations of any exchange on which the Common Shares may then be listed. 16. Shareholder Rights. A Participant shall have no rights as a shareholder with respect to any Common Shares issuable upon exercise of an Option until a certificate or certificates evidencing such shares shall have been issued to such Participant, and no 7 adjustment shall be made for dividends or distributions or other rights in respect of any share for which the record date is prior to the date upon which the Participant shall become the holder of record thereof. 17. Amendments, Etc. (a) The Board may at any time and from time to time alter, amend, suspend or terminate the Plan in whole or in part; provided, however, that no termination or amendment of the Plan may, without the consent of the Participant to whom any Award shall previously have been granted, adversely affect the rights of such Participant in such Award; provided further, however that amendments shall be subject to any approvals, whether regulatory, shareholder or otherwise, which are required by law or any applicable securities exchange. (b) The Plan shall not confer upon any Participant any right with respect to continuance of employment or other service with the Company or any Subsidiary, nor will it interfere in any way with any right the Company or any Subsidiary would otherwise have to terminate such Participant's employment or other service at any time. 18. Effective Date. The Plan shall be effective as of the Closing Date (as defined in the Agreement and Plan of Merger, dated as of December 23, 1996, among the Company, Synternet Acquisition Corp., a Delaware corporation and a wholly owned Subsidiary of the Company, Avicenna and certain shareholders of Avicenna). 19. Governing Law. The Plan and all rights hereunder shall be construed in accordance with and governed by the laws of the State of New Jersey without reference to the choice of law provisions of New Jersey law. EX-4.2 3 CLASS D STOCK OPTION PLAN SYNETIC, INC. 1997 CLASS D STOCK OPTION PLAN 1. Purpose. The purposes of the Synetic, Inc. 1997 Class D Stock Option Plan (the "Plan") are to attract, retain and motivate officers, Key Employees (as defined below) and consultants of CareAgents, Inc., a Delaware corporation ("CareAgents"), and its Affiliates and to provide to such persons incentives and rewards for superior performance. 2. Definitions. As used in the Plan the following terms have the following meanings: (a) "Affiliate" shall have the meaning given to such term in Rule 12b-2 promulgated under the Exchange Act. (b) "Award" means an Option. (c) "Board" means the Board of Directors of the Company. (d) "Cause" means a termination of the Participant's employment or status as a consultant with the Company or any of its Affiliates (a) for "cause" as defined in an employment agreement or consulting agreement applicable to the Participant, or (b) in the case of a Participant who does not have an employment agreement or consulting agreement that defines "cause", because of any of the following, each as communicated to the Participant by notice from CareAgents setting forth in reasonable detail the nature of such Cause: 1. A willful failure of the Participant to perform his employment-related duties in any material respect which is not cured by the Participant within 10 days following written notice from the Company detailing such failure (other than any such failure resulting from a Permanent Disability of the Participant); 2. Any willful misconduct by the Participant relating, directly or indirectly, to the Company, CareAgents or any of their respective Affiliates, or any breach by the Participant of any material policy of the Company, CareAgents or any of their respective Affiliates, as reasonably determined by the Committee, which breach, if susceptible to cure, is not cured by the Participant within 10 days following written notice from the Company detailing such breach; 3. Any breach by the Participant of any restrictive covenants set forth in the applicable Agreement or any substantially similar provisions in any other agreements with the Company, CareAgents or any of their respective Affiliates, as reasonably determined by the Committee; or 2 4. Any willful violation by the Participant of any federal or state law or regulation applicable to the business of the Company, CareAgents or any of their respective Affiliates, or the Participant's commission of a common law fraud or conviction of a felony or crime involving moral turpitude. (e) "Code" means the Internal Revenue Code of 1986, as amended. (f) "Committee" means a committee of the Board comprised of at least two directors selected by the Board to administer the Plan. (g) "Common Share" means a share of common stock, $.01 par value, of the Company. (h) "Company" means Synetic, Inc., a Delaware corporation. (i) "Date of Grant" means the date on which an Option is granted, as determined by the Committee and as set forth in the applicable Agreement. (j) "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder. (k) "Fair Market Value" of a Common Share on a given date means the closing price of a Common Share on such date (or the most recent trading date if such date is not a trading date) on the NASDAQ/National Market System or such national exchange, if any, as may be designated by the Committee. (l) "Key Employee" means a person employed by CareAgents or one of its Affiliates on a full-time basis (including officers) or, with the consent of the Committee, on a part-time basis, who are compensated for such employment by a regular salary. (m) "Option Price" means the purchase price per Common Share payable on exercise of an Option, as determined by the Committee (subject to the terms of the Plan) and as set forth in the applicable Agreement. (n) "Option" means the right to purchase a Common Share upon exercise of a nonqualified stock option granted pursuant to the Plan. (o) "Participant" means a person to whom an Award has been made by the Committee in its sole discretion and who is at the time of such Award an officer, Key Employee, or consultant of CareAgents or any of its Affiliates. (p) A Participant shall be deemed to be "Permanently Disabled" if (i) such Participant shall become ill, mentally or physically disabled, or otherwise incapacitated so as to 3 be unable regularly to perform the duties of his position for a period in excess of 90 consecutive days or more than 120 days in any consecutive 12 month period, or (ii) a duly licensed physician selected by the Company or CareAgents with the reasonable approval of the Participant determines that the Participant is mentally or physically disabled so as to be unable to perform regularly the duties of his position and such condition is expected to be of a permanent duration. (q) "Rule 16b-3" means Rule 16b-3 under the Exchange Act. (r) "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations thereunder. (s) "Subsidiary" means any corporation in which the Company owns or controls, directly or indirectly, not less than 50% of the total combined voting power represented by all classes of stock issued by such corporation. (t) "Vested Options" means, as of any date, Options which by their terms are exercisable on such date. 3. Administration of the Plan. (a) The Plan shall be administered, and Awards shall be granted hereunder, by the Board or, if the Board so elects, by the Committee. A majority of the Committee shall constitute a quorum, and the action of the members of the Committee present at any meeting at which a quorum is present, or acts unanimously approved in writing, shall be the acts of the Committee. In the event that the Board does not elect to appoint a Committee then, for purposes of administering the Plan, the term "Board" shall be substituted for the term "Committee" wherever it appears in the Plan. (b) The interpretation and construction by the Committee of any provision of the Plan or of any Agreement, and any determination by the Committee pursuant to any provision of this Plan or of any Agreement shall be final and conclusive. No member of the Committee shall be liable for any such action or determination made in good faith. 4. Shares Available Under Plan. The maximum number of Common Shares which may be issued upon the exercise of Options granted under the Plan is 1,000,000 Common Shares, subject to adjustment as provided in Paragraph 10. Such shares may be shares of original issuance or treasury shares or a combination of the foregoing. Any Common Shares which are subject to Options which expire or which have been surrendered without being exercised in full shall again be available for issuance under the Plan. 5. Options. The Committee may, from time to time and upon such terms and conditions as it may determine, authorize the granting to Participants of Options. 4 6. Agreement. The terms and conditions of each Option shall be embodied in a written agreement (the "Agreement") in a form approved by the Committee which shall contain terms and conditions not inconsistent with the Plan and which shall incorporate the Plan by reference. Options granted under the Plan shall comply with the following terms and conditions: (i) Each Agreement shall specify the number of Common Shares for which Options have been granted. (ii) Each Agreement shall specify the Option Price, which shall not be less than the Fair Market Value per Common Share on the Date of Grant. (iii) Each Agreement shall specify that the Option Price shall be payable in cash or by certified or official bank check. If determined by the Committee in its sole discretion and specified in the applicable Agreement, the Option Price shall also be payable (a) by the transfer to the Company of Common Shares having an aggregate Fair Market Value per Common Share at the date of exercise equal to the aggregate Option Price or (b) by a combination of the foregoing methods of payment. (iv) Each Agreement shall specify the applicable vesting schedule and the effective term of the Option. (v) Options granted under the Plan are not intended to qualify as "incentive stock options" within the meaning of Section 422 of the Code. (vi) No Option shall be exercisable more than ten years from the Date of Grant. (vii) Each Option granted under the Plan shall be subject to such additional terms and conditions, not inconsistent with the Plan, which are prescribed by the Committee and set forth in the applicable Agreement. (viii) As soon as practicable following the exercise of any Options, a certificate evidencing the number of Common Shares issued in connection with such exercise shall be issued in the name of the Participant. (ix) As a condition to the exercise of an Option, a Participant shall satisfy any outstanding indebtedness or liability of the Participant to the Company, CareAgents or any of the respective Affiliates, unless determined otherwise by the Committee in its sole discretion. 7. Date of Exercise. An Option shall be exercisable at the times specified by the Committee in the applicable Agreement. The Committee may also determine that an 5 Option shall become exercisable in full or in part, whether or not it is then exercisable, upon such circumstances or events as the Committee determines, in its sole discretion, merits special consideration. 8. Termination of Employment. (a) In the event that a Participant's employment or status as a consultant with the Company or any of its Affiliates terminates for any reason, the Participant (or the Participant's estate) shall be entitled to exercise the Participant's Options which have become Vested Options as of the date of termination for a period of 30 days (60 days in the event of Permanent Disability and 180 days in the event of death) following the date of termination. (b) In the event that a Participant's employment or status as a consultant with the Company or any of its Affiliates terminates for any reason, any Options which have not become Vested Options as of the date of termination (the "Date of Termination") shall, unless otherwise provided in the applicable Agreement, terminate and be cancelled without any consideration being paid therefor. (c) In the event that (i) a Participant's employment with the Company or any of its Affiliates terminates for any reason (other than a termination by the Company or any of its Affiliates for Cause) and (ii) such Participant is retained as a consultant to the Company or any of its Affiliates immediately following such termination of employment, then, in the sole discretion of the Committee, such Participant's employment with the Company and its Affiliates shall be deemed to continue for purposes of this Section 8 (and any restrictive covenants applicable to the Participant, including, without limitation, any restrictive covenants set forth in any employment agreement or the applicable Agreement) until the termination of such Participant's status as a consultant or such earlier date as may be determined by the Committee in its sole discretion. 9. Transferability. No Option shall be transferable by a Participant other than by will or the laws of descent and distribution. Options shall be exercisable during the Participant's lifetime only by the Participant or by the Participant's guardian or legal representative. 10. Adjustments. The Committee shall make or provide for such adjustments in the maximum number of Common Shares specified in Section 4, in the number of Common Shares covered by outstanding Options granted hereunder, and/or in the Option Price applicable to such Options as the Committee in its sole discretion may determine is equitably required to prevent dilution or enlargement of the rights of Participants that otherwise would result from any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, merger, consolidation, spin-off, reorganization, partial or complete liquidation, issuance of rights or warrants to purchase securities or any other corporate transaction or event having an effect similar to any of the foregoing. 6 11. Reorganization. In the event that the Company is merged or consolidated with another corporation, or in the event of a reorganization, separation, or liquidation of the Company, the Board or the board of directors of any corporation assuming the obligations of the Company hereunder may either (i) make appropriate provisions for the protection of any outstanding Options by the substitution on an equitable basis of appropriate securities of the Company, or appropriate securities of the merged, consolidated, or otherwise reorganized corporation, or the appropriate adjustment in the Option Price, or both, or (ii) give written notice to the Participants that their Options must be exercised, to the extent then exercisable, within 60 days of the date of such notice or the Options will terminate. 12. Restrictive Covenants. The applicable Agreement may set forth certain restrictive covenants applicable to the Participant, as determined by the Committee in its sole discretion. 13. Fractional Shares. The Company shall not be required to issue any fractional Common Share pursuant to the Plan. The Committee may provide for the elimination of fractions or for the settlement of fractions in cash. 14. Withholding Taxes. The Company and its Affiliates shall have the right to require any individual entitled to receive Common Shares pursuant to an Option to remit to the Company, prior to the delivery of any certificates evidencing such shares, any amount sufficient to satisfy any United States federal, state or local tax withholding requirements. With the consent of the Committee in its sole discretion, prior to the Company's determination of such withholding liability, such individual may make an irrevocable election to satisfy, in whole or in part, such obligation to remit taxes by directing the Company to withhold Common Shares that would otherwise be received by such individual. Such election may be denied by the Committee in its sole discretion, or may be made subject to certain conditions specified by the Committee, including, without limitation, conditions intended to avoid the imposition of liability against the individual under Section 16(b) of the Exchange Act. 15. Registration Restrictions, Exchange Rules. An Option shall not be exercisable unless and until (i) a registration statement under the Securities Act has been duly filed and declared effective pertaining to the Common Shares subject to such Option and such Common Shares shall have been qualified under applicable state "blue sky" laws, or (ii) the Committee in its sole discretion determines that such registration and qualification is not required as a result of the availability of an exemption from such registration and qualification under such laws. Any and all grants of Options shall be subject to all applicable rules and regulations of any exchange on which the Common Shares may then be listed. 16. Shareholder Rights. A Participant shall have no rights as a shareholder with respect to any Common Shares issuable upon exercise of an Option until a certificate or certificates evidencing such shares shall have been issued to such Participant, and no adjustment shall be made for dividends or distributions or other rights in respect of any share 7 for which the record date is prior to the date upon which the Participant shall become the holder of record thereof. 17. Amendments, Etc. (a) The Board may at any time and from time to time alter, amend, suspend or terminate the Plan in whole or in part; provided, however, that no termination or amendment of the Plan may, without the consent of the Participant to whom any Award shall previously have been granted, adversely affect the rights of such Participant in such Award; provided further, however, that amendments shall be subject to any approvals, whether regulatory, shareholder or otherwise, which are required by law or any applicable securities exchange. (b) The Plan shall not confer upon any Participant any right with respect to continuance of employment or other service with the Company or any Affiliate nor will it interfere in any way with any right the Company or any Affiliate would otherwise have to terminate such Participant's employment or other service at any time. 18. Effective Date. The Plan shall be effective as of the Closing Date (as defined in the Agreement and Plan of Merger, dated as of January 23, 1997, among the Company, Synternet Acquisition Corp., a Delaware corporation and a wholly owned Subsidiary of the Company, CareAgents and certain shareholders of CareAgents). 19. Governing Law. The Plan and all rights hereunder shall be construed in accordance with and governed by the laws of the State of New Jersey without reference to the choice of law provisions of New Jersey law. EX-4.3 4 SPECIAL NON-QUALIFIED STOCK OPTION PLAN SYNETIC, INC. 1991 SPECIAL NON-QUALIFIED STOCK OPTION PLAN -------------------- 1. Definitions. The terms below shall be defined as indicated. 1.1 Board means the Board of Directors of the Company. 1.2 Code means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute thereto. 1.3 Committee means the Stock Option Plan Committee of the Board described in Section 3 or such other committee as the Board may appoint from time to time to administer the Plan. 1.4 Common Stock means the Company's common stock, par value $.01, subject to the provisions of Section 9. 1.5 Company means Synetic, Inc., a Delaware corporation, and any successor corporation which adopts the Plan. 1.6 Designated Officer means any officer of the Company that the Board or the Committee may designate pursuant to Section 3 to act on their behalf with respect to the Plan. 1.7 Exchange Act means the Securities Exchange Act of 1934, as amended from time, or any successor statute thereto. 1.8 Fair Market Value means, on a specified date, the last sales price of a Share traded on the over-the-counter market, as reported on the National Association of Securities Dealers Automated Quotation System, or the last closing price for a Share on the stock exchange, if any, on which Shares are primarily traded (or if no Shares were traded on such date, then on the last previous date on which any Shares were so traded), or if none of the above is applicable, the value of a Share for such date as established by the Committee, using any reasonable method of valuation. 1.9 Key Contractors means consultants, agents and other persons (including officers) engaged by the Company, or by a Subsidiary, to render services to or on behalf of the Company or a Subsidiary. 1.10 Key Employees means persons employed by the Company or a Subsidiary on a full-time basis (including officers), who are compensated for such employment by a regular salary. 1.11 Option means an option to purchase Shares granted by the Company pursuant to the Plan. 1.12 Option Agreement means a written agreement as described in Section 7 between the Company and the Optionee evidencing an Option. 1.13 Option Period means the period from the date of the granting of an Option to the date on which that Option can no longer be exercised. 1.14 Option Price means the price to be paid for the Shares purchased pursuant to an Option. 1.15 Optionee means any person who is granted an Option under the Plan. 1.16 Parent means a parent of the Company as defined under Section 424 of the Code, including, without limitation, Medco Containment Services, Inc. 1.17 Plan means the Company's 1991 Special Non-Qualified Stock Option Plan, as adopted by the Board in substantially the form set forth herein and as the same may be amended or otherwise modified from time to time. 1.18 Shares means shares of Common Stock. 1.19 Subsidiary means a subsidiary of the Company as defined under Section 424 of the Code. 2. Purpose. The Plan is intended to encourage ownership of Common Stock by Key Employees and Key Contractors, upon whose judgment and interest the Company is dependent for its successful operation and growth, in order to increase their proprietary interest in the Company's success and to encourage them to remain in the employ of the Company. 3. Administration. 3.1 Committee. The Plan shall be administered by the Board or, if the Board so determines, by a Committee appointed by the Board from among its members. The Board or the Committee may designate one or more Designated Officers, each of whom shall be authorized and empowered to exercise such functions and make such determinations with respect to the Plan and the administration thereof as the Board or the Committee shall specify in the resolution designating such officer. Any provision of the Plan to the contrary notwithstanding, (a) in the event of any inconsistency between any action taken by a Designated Officer and any action taken by the Committee concerning the Plan or any Options hereunder, the action taken by the Committee shall govern, (b) in the event of any inconsistency between any action taken by a Designated Officer or the Committee and any action taken by the Board concerning the Plan or any Options hereunder, the action taken by the Board shall govern and (c) no Designated Officer may take any action except to the extent authorized to do so by a resolution of the Board or the Committee. 3.2 Determination of Option Terms. Subject to the provisions of Section 12, the Board, the Committee or any Designated Officer shall have authority to determine the vesting and exercise schedule with respect to Options, the persons to whom Options shall be granted, the number of Shares to be covered by each Option, the time or times at which Options shall be granted and the terms and provisions of the Options, and to make all other determinations necessary or advisable for the administration of the Plan; provided, however, that in no event shall the vesting schedule for any Option permit the Option to become exercisable during the first five years in which the Option is outstanding at an average rate per year of more than 20% of the total number of shares issuable under the Option, except that in connection with the grant of such Option, the Board, the Committee or any Designated Officer then serving as the President or a Senior Executive Vice President of the Company may waive such limitation. Subject to the consent of any Optionee affected, the Board, the Committee or any Designated Officer may cancel any outstanding Options and issue new Options upon such terms and upon such conditions as the Board, the Committee or such Designated Officer may determine. 3.3 Interpretation and Construction. The interpretation and construction by the Board, the Committee or any Designated Officer of any provision of the Plan or of any Option Agreement shall be final and conclusive. 4. Eligible Persons. The Board, the Committee or any Designated Officer, as the case may be, may grant Options only to Key Employees or Key Contractors; provided, however, that no Option shall be granted to any individual who, at the time such Option is granted, is an "officer" of the Company, as such term is defined in Rule 16a-l(f) under the Exchange Act. 5. Grant of Options. 5.1 Procedure. Subject to the provisions of Section 8.1, the Board, the Committee or any Designated Officer may (but shall not be required to) grant Options, provided that the person to whom the Option is to be granted subsequently becomes a party to an Option Agreement. 5.2 Additional Grants. Nothing contained in the Plan shall be construed to preclude the granting of an Option or Options to an Optionee in addition to an Option or Options for the purchase of Shares already held by that Optionee or the granting of more than one Option to an Optionee at the same time. 5.3 Subject to Exchange Rules. Any and all grants of Options shall be subject to all applicable rules and regulations of any exchange on which the Company's Common Stock may then be listed. 6. Effective and Expiration Dates of Plan. The Plan shall be effective on July 1, 1991. No Option shall be granted after June 30, 2001. 7. Option Agreements. Option Agreements shall be in such form as the Board, the Committee or any Designated Officer shall approve or determine; provided, however, that all Option Agreements shall comply with and be subject to the following terms and conditions: 7.1 Manner, Time and Medium of Payment. An Option shall be exercised in the manner set forth in the Option Agreement relating thereto and payment in full of the Option Price for all Shares shall be made at the time of exercise. Payment shall be in United States dollars in the form of cash, certified check or bank draft, or by delivery of fully paid Shares valued at their Fair Market Value on the date of exercise, or, if the Board, the Committee or any Designated Officer so determines, by withholding Shares with respect to which the Optionee has exercised such Option having a Fair Market Value on the date of exercise equal to the sum of the Option Price for the withheld Shares and the remaining Shares with respect to which the Optionee has exercised such option, or any combination of such methods of payment. 7.2 Number of Shares. Subject to Section 9, the Option Agreement shall state the number of Shares to which it pertains. 7.3 Option Price. The Option Price shall be determined by the Board, the Committee or any Designated Officer. Notwithstanding the foregoing, subject to Section 9, except for options which are given in substitution for options of any parent, subsidiary, predecessor to or party to a merger or reorganization with or into the Company, the Option Price shall not be less than the Fair Market Value of a Share on the date the Option is granted. 7.4 Option Period. Each Option granted under the Plan shall expire no later than fifteen years from the date the Option is granted. Any Option Agreement may contain provisions for the earlier expiration of the Option in the event of the Optionee's termination of employment, retirement or death or in the event of a violation by an Optionee of any of such Optionce's duties to the Company or any Subsidiary. 7.5 Date of Exercise. An Option may be exercised, to the extent vested, in whole or in part from time to time during the Option Period. Notwithstanding the foregoing, (i) the Board, the Committee or any Designated Officer in his, her or its sole discretion may determine at the time of grant of any Option that such Option shall not become exercisable before a specified time but at such specified time shall become exercisable as to all Shares as to which the Option has previously vested, and (ii) an Option shall become exercisable in full or in part, whether or not it is then exercisable, upon such extraordinary circumstances or events as the Board, the Committee or any Designated Officer determines, in his, her or its sole discretion. 7.6 Reorganization. In case the Company is merged or consolidated with another corporation, or in case of a reorganization, separation or liquidation of the Company, the Board or the board of directors of any corporation assuming the obligations of the Company hereunder shall either (i) make appropriate provisions for the protection of any outstanding options by the substitution on an equitable basis of appropriate securities of the Company, or appropriate shares or other securities of the merged, consolidated, or otherwise reorganized corporation, or the appropriate adjustment in the Option Price, or both, or (ii) give written notice to Optionees that their Options must be exercised, to the extent then exercisable after giving due effect to Section 7.5, within 60 days of the date of such notice or they will terminate, and to the extent that such Options are not exercised within such 60-day period they shall terminate and be of no further effect. 7.7 Assignability. No Option shall be assignable or transferable except by will, by the laws of descent and distribution or pursuant to a qualified domestic relations order (as such term is defined in the Code), and no Option may be exercised other than by an Optionee or, after the death of an Optionee, by that Optionee's personal representatives, heirs, or legatees. 7.8 Violation of Agreements. The Board, the Committee or any Designated Officer, in his, her or its sole discretion may require that any Option Agreement include provisions that in the event of a violation by the Optionee of his or her duties to the Company or any Subsidiary (whether before or after termination of the Optionee's services), the existence of which violation shall be determined by the Board, the Committee or any Designated Officer in his, her or its sole discretion (which determination shall be conclusive), the Optionee shall remit to the Company all income that he or she has realized during the twenty-four month period prior to such violation, or that he or she subsequently realizes, as a result of his or her exercise from time to time, in whole or in part, of the Option, before federal, state or local taxes. 7.9 No Right to Continue with Company. Nothing in the Plan or in any Option granted under the Plan shall confer (or be deemed to confer) any right on any Optionee to continue as an Officer or as an employee of the Company or any Subsidiary or shall interfere in any way with the right of the Company or any Subsidiary to terminate such status at any time, with or without cause and with or without notice. 7.10 Rights as a Stockholder. An Optionee shall have no rights as a stockholder with respect to Shares covered by any Option until the date the Company has issued or delivered such Shares to the Optionee, and then only as to such Shares as are actually issued and delivered to the Optionee. 7.11 Other Provisions. Option Agreements shall contain such other terms and conditions not inconsistent with the Plan as the Board, the Committee or any Designated Officer shall deem advisable. 7.12 Compliance with Law. Notwithstanding any provision of the Plan or any Option Agreement to the contrary, no Option may be granted or exercised at any time when such Option or the granting or exercise thereof or payment therefor may result in the violation of any law or governmental order or regulation. 7.13 Securities Laws. The Company intends to register the Shares issuable pursuant to exercise of Options under the Securities Act of 1933, as amended, and to effect similar compliance under applicable state laws, but shall be under no obligation to do so. The Board, the Committee or any Designated Officer may require, as a condition of the issuance and delivery of certificates evidencing Shares issuable pursuant to exercise of Options, that the Optionee make such covenants, agreements and representations, including, without limitation, as to compliance with applicable securities laws, and that such certificates bear such legends, as the Board, the Committee or such Designated Officer in his, her or its sole discretion deems necessary or desirable. 8. Shares Available for Option. 8.1 Maximum. Subject to Sections 7.6 and 9, no more than 300,000 Shares shall be subject to purchase pursuant to Options granted under the Plan, which Shares may be either Shares held in treasury or authorized but unissued Shares. At all times during the term of the Plan, the Company shall have reserved that number of Shares less an amount equal to the number of Shares held in treasury and the number of Shares which have been issued pursuant to the exercise of Options. At all times after termination of the Plan, the Company shall have reserved for issuance a number of Shares equal to the aggregate number of Shares subject to outstanding Options less the number of Shares held in treasury. 8.2 Expiration or Termination. If any outstanding Option under the Plan expires for any reason or is terminated prior to the expiration date of the Plan as set forth in Section 6, the Shares allocable to any unexercised portion of such Option may again be subject to an Option. 9. Recapitalization or Change in Par Value of Common Stock. The aggregate number of Shares purchasable under Options granted and which may be granted pursuant to the Plan and the Option Price for Shares covered by each outstanding Option shall all be proportionately adjusted, as deemed appropriate by the Board, the Committee or any Designated Officer if the Shares are split up, converted, exchanged, reclassified or in any way substituted for. The Board, the Committee or such Designated Officer shall provide for appropriate adjustments of the numbers of shares purchasable under the Plan and of outstanding Options in the event of stock dividends or distributions of assets or securities of other companies owned by the Company to stockholders relating to Common Stock for which the record date is prior to the date the Shares purchased by exercise of an Option are issued or transferred, except that no such adjustment shall be made for cumulative stock dividends of 10% or less (in the aggregate) or cash dividends. Any such adjustment may include an adjustment of the Option Price or the number of Shares for which an Option may be exercised, or may provide for an escrow of assets or securities so distributed to be available upon future exercise. In the event of a change in the Company's presently authorized Common Stock which is limited to a change of all of its presently authorized Shares of Common Stock with par value into the same number of shares without par value, or any change of the then authorized Shares of Common Stock with par value into the same number of shares of Common Stock with a different par value, the shares resulting from any such change shall be deemed to be Shares as defined in Section 1, and no change in the number of Shares covered by each Option or in the Option Price shall take place. 10. Indemnification; Reliance; Exculpation. 10.1 Indemnification. Each person who is or shall have been a member of the Board or of the Committee and each Designated Officer shall be indemnified and held harmless by the Company against and from any and all loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit, or proceeding to which such person may be a party or in which such person may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by such person in settlement thereof (with the Company's written approval) or paid by such person in satisfaction of a judgment in any such action, suit, or proceeding to the fullest extent permitted by the Delaware General Corporation Law, subject, however, to the condition that upon the institution of any such claim, action, suit, or proceeding, such person shall in writing give the Company an opportunity to intervene at the Company's expense on his or her behalf. The foregoing right of indemnification shall not be exclusive of any other right to which such person may be entitled as a matter of law or otherwise, or any power that the Company may have to indemnify such person or hold him or her harmless. 10.2 Reliance. Each member of the Board or of the Committee, each Designated Officer and each other officer and employee of the Company in performing duties under the Plan shall be entitled to rely upon information and reports furnished in connection with the administration of this Plan by any duly authorized officer or agent of the Company. 10.3 Exculpation. No member of the Board or of the Committee and no Designated Officer shall be liable for any action or determination made in good faith with respect to the Plan or any Option granted under the Plan. 11. Income Tax Withholding. The Board, the Committee or any Designated Officer in his, her or its sole discretion may require that any Option Agreement include provisions that if the Company or a Subsidiary shall be required to withhold any amounts by reason of any federal, state or local tax rules or regulations in respect of the issuance of Shares pursuant to the exercise of an Option, the Company or the Subsidiary shall be entitled to deduct and to withhold such amount from any cash payments to be made to the Optionee. In any event, the Optionee shall either (i) make available to the Company or Subsidiary, promptly when requested by the Company or such Subsidiary, sufficient funds or, if the Option Agreement so provides, Shares (valued at Fair Market Value as of the date the withholding tax obligation arises (the "Tax Date")), to meet the requirements of such withholding, or (ii) to the extent permitted by the Board, the Committee or any Designated Officer, irrevocably authorize the Company to withhold from the Shares otherwise issuable to the Optionee as a result of such exercise a number of Shares having a Fair Market Value as of the Tax Date which alone, or when added to funds paid or Shares delivered to the Company or the Subsidiary by the Optionee, equal the amount of the minimum withholding tax obligation (the "Withholding Election") and the Company or such Subsidiary shall be entitled to take and authorize such steps as it may deem advisable in order to have such funds or Shares made available to the Company or such Subsidiary out of any funds or property due or to become due to the Optionee. An Optionee's Withholding Election may only be made prior to the Tax Date and may be disapproved by the Board, the Committee or any Designated Officer. The Board, the Committee or any Designated Officer may establish such rules and procedures as he, she or it may deem necessary or advisable in connection with the withholding of taxes relating to the exercise of any Option. 12. Amendment or Termination of Plan. The Plan may be terminated and may be modified or amended by the Board or the Committee at any time and from time to time; provided, however, that no such termination, modification, or amendment of the Plan shall alter or affect the terms of any then outstanding Options previously granted hereunder without the consent of the holder thereof. 13. Set-Off. If at any time an Optionee is indebted to the Company or any Subsidiary, the Company may in the discretion of the Board, the Committee or any Designated Officer (a) withhold from the Optionee (i) following the exercise by the Optionee of an Option, Shares issuable to the Optionee having a Fair Market Value on the date of exercise up to the amount of indebtedness to the Company or (ii) following the sale by an Optionee of Shares received pursuant to the exercise of an Option, amounts due to an Optionee in connection with the sale of such Shares up to the amount of indebtedness to the Company, or (b) take any substantially similar action. The Board, the Committee or any Designated Officer may establish such rules and procedures as he, she or it may deem necessary or advisable in connection with the taking of any action contemplated by this Section 13. 14. Headlines. The section headings contained herein have no substantive meaning or content and are not part of this Plan. EX-5 5 OPINION OF SHEARMAN & STERLING September 16, 1997 Synetic, Inc. 669 River Drive Elmwood Park, NJ 07407-1361 Ladies and Gentlemen: We have acted as counsel for Synetic, Inc., a Delaware corporation (the "Company"), in connection with the Registration Statement on Form S-8 (the "Registration Statement") of the Company filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Securities Act"), with respect to 2,765,650 shares (the "Shares") of common stock, par value $.01 per share, of the Company (the "Common Stock"), to be issued from time to time pursuant to the (i) Synetic, Inc. 1996 Class C Stock Option Plan, (ii) Synetic, Inc. 1997 Class D Stock Option Plan and (iii) Synetic, Inc. Special Non-Qualified Stock Option Plan (each, a "Plan"). In so acting, we have examined the Registration Statement and we have also examined and relied as to factual matters upon the representations and warranties contained in originals, or copies certified or otherwise identified to our satisfaction, of such documents, records, certificates and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below. In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents, certificates and instruments submitted to us as originals and the conformity with originals of all documents submitted to us as copies. The opinion expressed below is limited to the General Corporation Law of Delaware, and we do not express any opinion herein concerning any other law. Based upon the foregoing and having regard for such legal considerations as we have deemed relevant, we are of the opinion that the Shares have been duly authorized by the Synetic, Inc. 2 Septemer 16, 1997 Company and, when (a) issued and delivered by the Company in accordance with the terms of the relevant Plan and (b) paid for in full in accordance with the terms of the relevant Plan, the Shares will be validly issued, fully paid and non-assessable. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. Very truly yours, Shearman & Sterling cc/sa EX-23.1 6 CONSENT OF ARTHUR ANDERSON & CO. ARTHUR ANDERSEN CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the use of our report included (or incorporated by reference) in Synetic, Inc.'s Form 10-K for the year ended June 30, 1996 and to all references to our Firm included in this registration statement. /s/ Arthur Andersen LLP ARTHUR ANDERSEN LLP New York, New York September 15, 1997 EX-23.2 7 CONSENT OF KEGLER, BROWN, HILL & RITTER,CO.,L.P.A. KEGLER, BROWN, HILL & RITTER August 13, 1997 Synetic, Inc. 669 River Drive Elmwood Park, NJ 07407-1361 Dear Ladies and Gentlemen: We hereby consent to the incorporation by reference into the Synetic, Inc. Registration Satement on Form S-8, including the Form S-3 resale prospectuses included therein, filed with the Securities and Exchange Commission, of Synetic's Annual Report on Form 10-K for the fiscal year ended June 30, 1996. We also consent to all references to our firm included in such Registration Statements. Columbus, Ohio August 13, 1997 Very truly yours, KEGLER, BROWN, HILL & RITTER CO., L.P.A. By:/s/ Jack A. Bjerke -------------------------------------- Jack A. Bjerke, Vice President JAB:wlm -----END PRIVACY-ENHANCED MESSAGE-----