Exhibit 10.19
WAM!NET INC.
AMENDED AND RESTATED
1994 STOCK OPTION PLAN
1. Purpose. The purpose of the WAM!NET Inc. 1994 Stock Option Plan
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(formerly the Netco Communications Corporation 1994 Stock Option Plan) (the
"Plan") has been to provide a continuing long-term incentive to selected
eligible officers and key employees of WAM!NET Inc. (the "Corporation") and of
any subsidiary corporation of the Corporation (the "Subsidiary"), as herein
defined, and to Non-Employee Directors of the Corporation; to provide a means of
rewarding outstanding performance; and to enable the Corporation to maintain a
competitive position to attract and retain key personnel necessary for continued
growth and profitability. This amendment and restatement of the Plan was adopted
by the Corporation's Board of Director's on April 24th, 1998, in conjunction
with the adoption of the WAM!NET Inc. 1998 Combined Stock Option Plan, to
reflect the Corporation's name change to WAM!NET Inc., to incorporate prior
amendments to the Plan, to provide that no new Options will be granted after
April 24, 1998 under the Plan, and to limit the number of shares available under
the Plan to those with respect to which Options were granted prior to April
25,1998.
2. Definitions. The following words and phrases as used herein shall have
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the meanings set forth below:
2.1. "Board" shall mean the Board of Directors of the Corporation.
2.2. "Code" shall mean the Internal Revenue Code of 1986, as amended.
2.3. "Committee" shall mean the Stock Option Committee of the Board, or
such other committee of the Board as may be designated by the Board, from time
to time, for the purpose of administering this plan as contemplated by Section 4
hereof.
2.4. "Common Stock" shall mean the common stock, $0.01 par value, of the
Corporation.
2.5. "Corporation" shall mean WAM!NET Inc., (f/k/a Netco Communications
Corporation), a Minnesota corporation.
2.6. "Non-Employee Director" shall mean a member of the Board who is not an
employee of the Corporation or any Subsidiary.
2.7. "Fair Market Value" of any security on any given date shall be
determined by the Committee as follows: (a) if the security is listed for
trading on one or more national securities exchanges, or is quoted on NASDAQ
National Market, the last reported sales price on the principal such exchange or
NASDAQ on the date in question, or if such security shall not have been traded
on such principal exchange on such date, NASDAQ on the first day prior thereto
on which such security was so traded; or (b) if the security is not listed for
trading on a national
WAM!NET Inc.
Amended and Restated
1994 Stock Option Plan
securities exchange or NASDAQ National Market, but is traded in the over-the-
counter market, including NASDAQ, closing bid price for such security on the
date in question, or if there is no such bid price for such security on such
date, the closing bid price on the first day prior thereto on which such price
existed; or (c) if neither (a) nor (b) is applicable, by any means deemed fair
and reasonable by the Committee, which determination shall be final and binding
on all parties.
2.8. "ISO" shall mean any stock option granted pursuant to this Plan as an
"incentive stock option" within the meaning of Section 422 of the Code.
2.9. "NQO" shall mean any stock option granted pursuant to this Plan,
which is not an ISO.
2.10. "Option" shall mean any stock option granted pursuant to this Plan,
whether an ISO or an NQO.
2.11. "Optionee" shall mean any person who is the holder of an Option
granted pursuant to this Plan.
2.12. "Plan" shall mean this 1994 Stock Option Plan of the Corporation.
2.13. "Subsidiary" shall mean any corporation which at the time qualifies
as a subsidiary of the Corporation under Section 425(f) of the Code.
2.14. "Tax Date" shall mean the date on which the amount of tax to be
withheld is determined under the Code.
3. Shares Available Under Plan. The number of shares which may be issued
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pursuant to Options granted under this Plan shall not exceed 7,000,000 shares
(after adjustment pursuant Section 8 hereof to reflect the 5-for-1 stock split
effected by the Corporation on February 26, 1998) of the Common Stock of the
Corporation; provided, however, that shares which become available as a result
of canceled, unexercised, lapsed or terminated Options granted under this Plan
shall be available for issuance pursuant to Options subsequently granted under
this Plan, and the number of shares for which Options have been granted or are
available for grant under this Plan shall be proportionately increased or
decreased in accordance with Section 8 hereof upon occurrence of any event
described therein. The shares issued upon exercise of Options granted under this
Plan may be authorized and unissued shares or shares previously acquired or to
be acquired by the Corporation.
4. Administration.
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4.1. The Plan will be administered by the Board of Directors or by a
Committee (the "Committee") selected by the Board and consisting of at least
three members, none of whom for at least one year prior to service on the
Committee has been eligible to receive any Option under the Plan, or under any
other benefit plan of the Corporation or any of its affiliates entitling the
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Amended and Restated
1994 Stock Option Plan
participants therein to acquire stock or stock options of the Corporation or any
of its Subsidiaries. The Board or such Committee are hereinafter described as
the Committee.
4.2. The Committee will have plenary authority, subject to provisions of
the Plan, to determine when and to whom Options will be granted, the term of
each Option, the number of shares covered by it, the participation by the
Optionee in other plans, and any other terms or conditions of each Option. The
Committee shall determine with respect to each grant of an Option whether a
participant shall receive an ISO or an NQO. The number of shares, the term and
the other terms and conditions of a particular kind of Option need not be the
same, even as to options granted at the same time. The Committee's
recommendations regarding option grants and terms and conditions thereof will be
conclusive.
4.3. The Committee will have the sole responsibility for construing and
interpreting the Plan, for establishing and amending any rules and regulations
as it deems necessary or desirable for the proper administration of the Plan,
and for resolving all questions arising under the Plan. Any decision or action
taken by the Committee arising out of or about the construction, administration,
interpretation and effect of the Plan and of its rules and regulations will, to
the extent permitted by law, be within its absolute discretion, except as
otherwise specifically provided herein, and will be conclusive and binding on
all Optionees, all successors, and any other person, whether that person is
claiming under or through any Optionee or otherwise.
4.4. The Committee will designate one of its members as chairman. It will
hold its meetings at the times and places as it may determine. A majority of its
members will constitute a quorum, and all determinations of the Committee will
be made by a majority of its members. Any determination reduced to writing and
signed by all members will be fully as effective as if it had been made by a
majority vote at a meeting duly called and held. The Committee may appoint a
secretary, who need not be a member of the Committee, and may make such rules
and regulations for the conduct of its business as it may deem advisable.
4.5. No member of the Committee will be liable, in the absence of bad
faith, for any act or omission with respect to his services on the Committee.
Service on the Committee will constitute service as a member of the Board, so
that the members of the Committee will be entitled to indemnification and
reimbursement as Board members pursuant to the Corporation's Bylaws.
4.6. The Committee will regularly inform the Board as to its actions with
respect to all Options granted under the Plan and the terms and conditions and
any such Options in a manner, at any times, and in any form as the Board may
reasonably request.
5. Participants.
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5.1. Participation in this Plan shall be limited to officers and regular
full-time executive, administrative, professional, production and technical
employees of the Corporation, or of a Subsidiary, who are salaried employees of
the Corporation or of a Subsidiary, and
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Amended and Restated
1994 Stock Option Plan
consultants of the Corporation or of a Subsidiary. Non-Employee Directors of the
Company shall participate under this Plan only as specified in Section 14
hereof.
5.2. Subject to other provisions of this Plan, Options may be granted to
the same participants on more than one occasion.
5.3. Except with respect to Options granted to Non-Employee Directors
under Section 14, the Committee's determination under the Plan including,
without limitation, determination of the persons to receive Options, the form,
amount and type of such Options, and the terms and provisions of Options need
not be uniform and may be made selectively among otherwise eligible
participants, whether or not the participants are similarly situated.
6. Terms and Conditions.
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6.1. Each Option granted under the Plan shall be evidenced by a written
agreement, which shall be subject to the provisions of this Plan and to such
other terms and conditions as the Corporation may deem appropriate.
6.2. Each Option agreement shall specify the period for which the Option
thereunder is granted which in no event shall exceed ten years from the date of
the grant for any Option designated by the Committee as an ISO or ten years and
one day from the date of grant for any Option designated by the Committee as an
NQO and shall provide that the Option shall expire at the end of such period.
6.3. The exercise price per share shall be determined by the Committee at
the time any Option is granted and, if the Option is an ISO, shall be no less
than one hundred percent (100%) of Fair Market Value of the Common Stock of the
Corporation on the date the Option is granted, as determined by the Committee.
6.4. The aggregate Fair Market Value (determined as of the time the Option
is granted) of the Common Stock with respect to which an ISO under this Plan or
any other plan of the Corporation or its Subsidiaries is exercisable for the
first time by an Optionee during any calendar year shall not exceed $100,000.
6.5. An Option shall be exercisable at such time or times, and with
respect to such minimum number of shares, as may be determined by the
Corporation at the time of the grant. The Option agreement may require, if so
determined by the Corporation, that no part of the Option may be exercised until
the Optionee shall have remained in the employ of the Corporation or of a
Subsidiary for such period after the date of the Option as the Corporation may
specify.
6.6. The Corporation may prescribe the form of legend which shall be
affixed to the stock certificate representing shares to be issued and the shares
shall be subject to the provisions of any repurchase agreement or other
agreement restricting the sale or transfer thereof. Such agreements or
restrictions shall be noted on the certificate representing the shares to be
issued.
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Amended and Restated
1994 Stock Option Plan
6.7. Each Incentive Stock Option granted hereunder shall not be
transferable by the Optionee other than by will or by the laws of descent and
distribution, and shall be, during the Optionee's lifetime, exercisable only by
the Optionee or Optionee's guardian or legal representative. Each Non-Qualified
Stock Option granted hereunder may be transferred by the Optionee for estate
planning purposes subject to prior or other written approval by the Committee in
its sole discretion or pursuant to any policy and requirements concerning such
transfers then in effect as the Committee may in its discretion establish, amend
or revoke from time to time; by will or the laws of descent and distribution; or
pursuant to a qualified domestic relations order as defined in Section 414 of
the Code or Section 206 of the Employee Retirement Income Security Act, or rules
thereunder. Except as permitted by the preceding sentences, each Option granted
under the Plan and the rights and privileges thereby conferred shall not be
transferred, assigned or pledged in any way (whether by operation of law or
otherwise), and shall not be subject to execution, attachment or similar
process. Any attempt to so transfer, assign, pledge or otherwise dispose of the
Option, or of any right or privilege conferred thereby, contrary to the
provisions of the Option or the Plan, or any levy of any attachment or similar
process upon such rights and privileges, shall be void and unenforceable against
the Corporation.
7. Exercise of Option.
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7.1. Each exercise of an Option granted hereunder, whether in whole or in
part, shall be by written notice thereof, delivered to the Secretary of the
Corporation (or such other person as may be designated). The notice shall state
the number of shares with respect to which the Options are being exercised and
shall be accompanied by payment in full for the number of shares so designated.
Shares shall be registered in the name of the Optionee unless the Optionee
otherwise directs in his or her notice of election.
7.2. Payment shall be made to the Corporation either (i) in cash,
including certified check, bank draft or money order, (ii) at the discretion of
the Corporation, by delivering Common Stock of the Corporation already owned by
the participant, (iii) at the discretion of the Corporation, by delivering a
promissory note, containing such terms and conditions acceptable to the
Corporation, for all or a portion of the purchase price of the shares so
purchased, or a combination of (i), (ii) and (iii). With respect to (ii), the
Fair Market Value of stock so delivered shall be determined as of the date
immediately preceding the date of exercise.
7.3. Upon notification of the amount due and prior to, or concurrently
with, the delivery to the Optionee of a certificate representing any shares
purchased pursuant to the exercise of an Option, the Optionee shall promptly pay
to the Corporation any amount necessary to satisfy applicable federal, state or
local withholding tax requirements.
8. Adjustment of Option Stock. In case the shares issuable upon exercise
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of any Option granted under the Plan at any time outstanding shall be subdivided
into a greater or combined into a lesser number of shares (whether with or
without par value), the number of shares purchasable upon exercise of such
Option immediately prior thereto shall be adjusted so that the Optionee shall be
entitled to receive a number of shares which he or she would have
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Amended and Restated
1994 Stock Option Plan
owned or have been entitled to receive after the happening of such event had
such Option been exercised immediately prior to the happening of such
subdivision or combination or any record date with respect thereto. An
adjustment made pursuant to this paragraph shall become effective immediately
after the effective date of such subdivision or combination retroactive to the
record date, if any, for such subdivision or combination. The option price (as
such amount may have theretofore been adjusted pursuant to the provisions
hereof) shall be adjusted by multiplying the option price immediately prior to
the adjustment of the number of shares purchasable under the Option by a
fraction, of which the numerator shall be the number of shares purchasable upon
the exercise of the Option immediately prior to such adjustment, and of which
the denominator shall be the number of shares so purchasable immediately
thereafter. Substituted shares of stock shall be deemed shares under Section 3
of the Plan.
9. Assignments. Other than as provided in Section 6.7, any Option
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granted under this Plan shall be exercisable only by the Optionee to whom
granted during his or her lifetime and shall not be assignable or transferable
otherwise than by will or by the laws of descent and distribution.
10. Severance; Death; Disability. An Option shall terminate, and no
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rights thereunder may be exercised, if the person to whom it is granted ceases
to be employed by the Corporation or by a Subsidiary except that:
10.1. If the employment of the Optionee is terminated by any reason other
than his or her death or disability, the Optionee may at any time within not
more than three months after termination of his or her employment, exercise his
or her Option rights but only to the extent they were exercisable by the
Optionee on the date of termination of his or her employment; provided, however,
that if the employment is terminated as a result of the Optionee's deliberate,
willful or gross misconduct as determined by the Committee, all rights under the
Option shall terminate and expire upon such termination.
10.2. If the Optionee dies while in the employ of the Corporation or a
Subsidiary, or within not more than three months after termination of his or her
employment, the Optionee's rights under the Option may be exercised at any time
within one year following such death by his or her personal representative or by
the person or persons to whom such rights under the Option shall pass by will or
by the laws of descent and distribution, but only to the extent they were
exercisable by the Optionee on the date of death.
10.3. If the employment of the Optionee is terminated because of permanent
disability, the Optionee, or his or her legal representative, may at any time
within not more than one year after termination of his or her employment,
exercise his or her Option rights but only to the extent they were exercisable
by the Optionee on the date of termination of his or her employment.
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Amended and Restated
1994 Stock Option Plan
10.4. The same exercise periods as provided in Sections 11.1, 11.2 and 11.3
shall also apply with respect to a tranferee of an Option pursuant to Section
6.7, including the extension of the exercise period under Section 11.2 upon the
death of the tranferee.
10.5. Any provision of Sections 10.1, 10.2 and 10.3 to the contrary
notwithstanding, no Option or any right claimed thereby, therein or thereunder
shall be exercisable by anyone after the expiration of the term of the Option.
10.6. Transfers of employment between the Corporation and a Subsidiary, or
between Subsidiaries, will not constitute termination of employment for purposes
of any Option granted under this Plan. The Committee may specify in the terms
and conditions of an Option whether any authorized leave of absence or absence
for military or government service or for any other reasons will constitute a
termination of employment for purposes of the Option and the Plan.
11. Rights of Participants. Neither the participant nor the personal
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representatives, heirs, or legatees of such participant shall be or have any of
the rights or privileges of a shareholder of the Corporation in respect of any
of the shares issuable upon the exercise of an Option granted under this Plan
unless and until certificates representing such shares shall have been issued
and delivered to the participant or to such personal representatives, heirs or
legatees.
12. Securities Registration. If any law or regulation of the Securities
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and Exchange Commission or of any other body having jurisdiction shall require
the Corporation or the participant to take any action in connection with the
exercise of an Option, then notwithstanding any contrary provision of an Option
agreement or this Plan, the date for exercise of such Option and the delivery of
the shares purchased thereunder shall be deferred until the completion of the
necessary action. In the event that the Corporation shall deem it necessary, the
Corporation may condition the grant or exercise of an Option granted under this
Plan upon the receipt of a satisfactory certificate that the Optionee is
acquiring the Option or the shares obtained by exercise of the Option for
investment purposes and not with the view or intent to resell or otherwise
distribute such Option or shares. In such event, the stock certificate
evidencing such shares shall bear a legend referring to applicable laws
restricting transfer of such shares. In the event that the Corporation shall
deem it necessary to register under the Securities Act of 1933, as amended, or
any other applicable statute, any Options or any shares with respect to which an
Option shall have been granted or exercised, then the participant shall
cooperate with the Corporation and take such action as is necessary to permit
registration or qualification of such Options or shares.
13. Duration and Amendment.
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13.1. There is no express limitation upon the duration of the Plan, except
for the requirement of the Code that all ISO's must be granted within ten years
from the date the Plan is approved by the shareholders.
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Amended and Restated
1994 Stock Option Plan
13.2. The Board may terminate or may amend the Plan at any time; provided,
however, that the Board may not, without approval of the shareholders of the
Corporation, (i) increase the maximum number of shares as to which Options may
be granted under the Plan, (ii) permit the granting of ISO's at less than 100%
of Fair Market Value at time of grant, (iii) change the class of employees
eligible to receive Options under the Plan, or (iv) permit Directors to receive
options under the Plan other than pursuant to Section 14 hereof; and, provided
further, that the Board may not amend the Plan more than once every six months,
other than to comport with changes in the Code, the Employee Retirement Income
Security Act, or rules thereunder.
14. Granting of Options to Non-Employee Directors.
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14.1. Non-Employee Directors shall be entitled to receive such Options
under this Plan as may be granted to them from time to time.
14.2. All Options granted to Non-Employee Directors shall be designated as
NQOs, shall be evidenced by a written option agreement signed by the Corporation
and the Non-Employee Director, and shall be subject to the same terms and
provisions as are then in effect with respect to granting of NQOs to salaried
officers and key employees of the Corporation, except that the Option shall be
exercisable as to all or any part of the shares subject to the Option from the
date the Option is granted, and shall expire on the earliest of (i) twelve
months after the Optionee ceases to be a director (except by death), (ii) one
year after the death of the optionee, or (iii) seven years after the date of
grant. Subject to the foregoing, all provisions of this Plan not inconsistent
with the foregoing shall apply to Options granted to Directors, except that
Directors shall always have the right to deliver stock in exercise of options as
provided in Section 7.2.
15. Approval of Shareholders. This Plan expressly is subject to approval
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of holders of a majority of the outstanding shares of Common Stock of the
Corporation, and if it is not so approved on or before one year after the date
of adoption of this Plan by the Board, the Plan shall not come into effect, and
any Options granted pursuant to this Plan shall be deemed canceled.
16. Conditions of Employment. The granting of an Option to a participant
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under this Plan who is an employee shall impose no obligation on the Corporation
to continue the employment of any participant and shall not lessen or affect the
right of the Corporation to terminate the employment of the participant.
17. Other Options. Nothing in the Plan will be construed to limit the
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authority of the Corporation to exercise its corporate rights and powers,
including, by way of illustration and not by way of limitation, the right to
grant options for proper corporate purposes otherwise than under the Plan to any
employee or any other person, firm, corporation, association, or other entity,
or to grant options to, or assume options of, any person for the acquisition by
purchase, lease, merger, consolidation, or otherwise, of all or any part of the
business and assets of any person, firm, corporation, association, or other
entity.
8.