EXHIBIT 10.6
APROPOS TECHNOLOGY, INC.
EMPLOYEE STOCK PURCHASE PLAN OF 1999
1. Purpose. Apropos Technology, Inc., an Illinois corporation (the
"Company"), hereby adopts the Apropos Technology, Inc. Employee Stock Purchase
Plan of 1999 (the "Plan"). The purpose of the Plan is to provide an opportunity
for the employees of the Company and any designated subsidiaries to purchase
Common Shares of the Company at a discount through voluntary automatic payroll
deductions, thereby attracting, retaining and rewarding such persons and
strengthening the mutuality of interest between such persons and the Company's
shareholders.
2. Shares Subject to Plan. An aggregate of ________ Common Shares
(the "Shares") may be sold pursuant to the Plan. Such Shares may be authorized
but unissued Common Shares, treasury shares or Common Shares purchased in the
open market. If there is any change in the outstanding shares of Common Shares
by reason of a stock dividend or distribution, stock split-up, recapitalization,
combination or exchange of shares, or by reason of any merger, consolidation or
other corporate reorganization in which the Company is the surviving
corporation, the number of Shares available for sale shall be equitably adjusted
by the Committee appointed to administer the Plan to give proper effect to such
change.
3. Administration. The Plan shall be administered by a committee
(the "Committee") which shall be the Compensation Committee of the Board of
Directors or another committee consisting of not less than three directors of
the Company appointed by the Board of Directors, all of whom shall qualify as
non-employee directors within the meaning of Securities and Exchange Commission
Regulation (S) 240.16b-3 or any successor regulation. The Committee is
authorized, subject to the provisions of the Plan, to establish such rules and
regulations as it deems necessary for the proper administration of the Plan and
to make such determinations and interpretations and to take such action in
connection with the Plan and any Benefits granted hereunder as it deems
necessary or advisable. All determinations and interpretations made by the
Committee shall be binding and conclusive on all participants and their legal
representatives. No member of the Board, no member of the Committee and no
employee of the Company shall be liable for any act or failure to act hereunder,
by any other member or employee or by any agent to whom duties in connection
with the administration of this Plan have been delegated or, except in
circumstances involving his or her bad faith, gross negligence or fraud, for any
act or failure to act by the member or employee.
4. Eligibility. All regular employees of the Company, and of each
qualified subsidiary of the Company which may be so designated by the Committee,
other than, in the discretion of the Committee:
(a) employees whose customary employment is 20 hours or less per
week;
(b) employees whose customary employment is for not more than 5
months per year; and
(c) employees who have not been employed for at least [one] year as
of any Enrollment Date (as defined in paragraph 5);
shall be eligible to participate in the Plan. For the purposes of this Plan, the
term "employee" means any individual in an employee-employer relationship with
the Company or a qualified subsidiary of the Company, but shall exclude (a) any
independent contractor; (b) any consultant, (c) any individual performing
services for the Company or a qualified subsidiary who has entered into an
independent contractor or consultant agreement with the Company or a qualified
subsidiary; (d) any individual performing services for the Company or a
qualified subsidiary under an independent contractor or consultant agreement, a
purchase order, a supplier agreement or any other agreement that the Company or
a qualified subsidiary enters into for services; (e) any "leased employee" as
defined in Section 414(n) of the Internal Revenue Code; and (f) any individual
whose terms and conditions of employment are governed by a collective bargaining
agreement resulting from good faith collective bargaining where benefits of the
type being offered under the Plan were the subject of such bargaining, unless
such agreement specifies that such individuals are eligible for the Plan. The
term "qualified subsidiary" means any corporation or other entity in which a
fifty percent (50%) or greater interest is, at the time, directly or indirectly
owned by the Company or by one or more subsidiaries or by the Company and one or
more subsidiary which is designated for participation by the Committee.
5. Participation. An eligible employee may elect to participate in
the Plan as of any "Enrollment Date". Enrollment Dates shall occur on the first
day of an Offering Period (as defined in paragraph 8). Any such election shall
be made by completing and forwarding an enrollment and payroll deduction
authorization form to the Secretary of the Company prior to such Enrollment
Date, authorizing payroll deductions in an amount not exceeding [10%] of the
employee's gross pay for the payroll period to which the deduction applies. A
participating employee may increase or decrease payroll deductions as of any
subsequent Enrollment Date by completing and forwarding a revised payroll
deduction authorization form to the Secretary of the Company; provided, that
changes in payroll deductions shall not be permitted to the extent that they
would result in total payroll deductions exceeding [10%] of the employee's gross
pay. An eligible employee may not initiate, increase or decrease payroll
deductions as of any date other than an Enrollment Date. For purposes of this
Plan, the term "gross pay" means the gross amount of pay an employee would
receive at each regular pay period date before any deduction for required
federal or state withholding and any other amounts which may be withheld.
6. Payroll Deduction Accounts. The Company shall establish a
"Payroll Deduction Account" for each participating employee, and shall credit
all payroll deductions made on behalf of each employee pursuant to paragraph 5
to his or her Payroll Deduction Account. No interest shall be credited to any
Payroll Deduction Account.
7. Withdrawals. An employee may withdraw from an Offering Period at
any time by completing and forwarding a written notice to the Secretary of the
Company. Upon receipt of such notice, payroll deductions on behalf of the
employee shall be discontinued commencing with the immediately following payroll
period, and such employee may not again be eligible to participate in the Plan
until the next Enrollment Date. Amounts credited to the Payroll Deduction
Account of any employee who withdraws shall remain in the account and be
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used to purchase Shares in accordance with paragraph 9 hereof, subject to the
limitations in paragraph 8 hereof.
8. Offering Periods. The Plan shall be implemented by consecutive
Offering Periods with a new Offering Period commencing on the first trading day
on or after [January 1] and [July 1] of each year, or on such other date as the
Committee shall determine, and continuing thereafter to the last trading day of
the respective six-month period or until terminated in accordance with paragraph
17 hereof. The first Offering Period hereunder shall commence on [January 1,
2000]. "Trading day" shall mean a day on which the NASDAQ National Market System
is open for trading. The Committee shall have the power to change the duration
of Offering Periods (including the commencement dates thereof) with respect to
future offerings. The last trading day of each Offering Period prior to the
termination of the Plan (or such other trading date as the Committee shall
determine) shall constitute the purchase dates (the "Share Purchase Dates") on
which each employee for whom a Payroll Deduction Account has been maintained
shall purchase the number of Shares determined under paragraph 9(a).
Notwithstanding the foregoing, the Company shall not permit the exercise of any
right to purchase Shares
(a) to an employee who, immediately after the right is granted, would
own shares possessing 5% or more of the total combined voting power or
value of all classes of stock of the Company or any subsidiary; or
(b) which would permit an employee's rights to purchase shares under
this Plan, or under any other qualified employee stock purchase plan
maintained by the Company or any subsidiary, to accrue at a rate in excess
of $25,000 of the fair market value of such shares (determined at the time
such rights are granted) for each calendar year in which the right is
outstanding at any time.
For the purposes of subparagraph (a), the provisions of Section 424(d) of the
Internal Revenue Code shall apply in determining the stock ownership of an
employee, and the shares which an employee may purchase under outstanding rights
or options shall be treated as shares owned by the employee.
9. Purchase of Shares.
(a) Subject to the limitations set forth in paragraphs 7 and 8, each
employee participating in an offering shall have the right to purchase as many
whole Shares as may be purchased with the amounts credited to his or her Payroll
Deduction Account as of the payroll date coinciding with or immediately
preceding the last Wednesday of the month (or such other date as the Committee
shall determine) in which occurs the applicable Share Purchase Date (the "Cutoff
Date"). Fractional shares may not be purchased under the Plan. Any amount
remaining in the Payroll Deduction Account of a participant after the Share
Purchase Date shall be retained in the account for the purchase of additional
Shares in subsequent Offering Periods. Employees may purchase Shares only
through payroll deductions, and cash contributions shall not be permitted.
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(b) The "Purchase Price" for Shares purchased under the Plan shall be
not less than the lesser of an amount equal to [85%] of the closing price of
Common Shares (i) at the beginning of the Offering Period or (ii) on the Share
Purchase Date. For these purposes, the closing price shall be as reported on the
NASDAQ National Market System list as reported in the Wall Street Journal,
Midwest Edition. The Committee shall have the authority to establish a different
Purchase Price as long as any such Purchase Price complies with the provisions
of Section 423 of the Internal Revenue Code.
(c) On each Share Purchase Date, the amount credited to each
participating employee's Payroll Deduction Account as of the immediately
preceding Cutoff Date shall be applied to purchase as many whole Shares as may
be purchased with such amount at the applicable Purchase Price. Any amount
remaining in an employee's Payroll Deduction Account as of the relevant Share
Purchase Date in excess of the amount that may properly be applied to the
purchase of Shares as a result of the application of the limitations set forth
in paragraph 8 hereof shall be refunded to the employee as soon as practicable.
10. Brokerage Accounts or Plan Share Accounts. By enrolling in the
Plan, each participating employee shall be deemed to have authorized the
establishment of a brokerage account on his or her behalf at a securities
brokerage firm selected by the Committee. Alternatively, the Committee may
provide for Plan share accounts for each participating employee to be
established by the Company or by an outside entity selected by the Committee
which is not a brokerage firm. Shares purchased by an employee pursuant to the
Plan shall be held in the employee's brokerage or Plan share account ("Plan
Share Account") in his or her name, or if the employee so indicates on his or
her payroll deduction authorization form, in the employee's name jointly with a
member of the employee's family, with right of survivorship. An employee who is
a resident of a jurisdiction which does not recognize such a joint tenancy may
request that such Shares be held in his or her name as tenant in common with a
member of the employee's family, without right of survivorship.
11. Rights as Shareholder. An employee shall have no rights as a
shareholder with respect to Shares subject to any rights granted under this Plan
until payment for such Shares has been completed at the close of business on the
relevant Share Purchase Date.
12. Certificates. Certificates for Shares purchased under the Plan
will not be issued automatically. However, certificates for whole Shares
purchased shall be issued as soon as practicable following an employee's written
request. The Company may make a reasonable charge for the issuance of such
certificates.
13. Termination of Employment. If a participating employee's
employment is terminated for any reason, including death, if an employee is
granted a leave of absence of more than 90 days duration or if an employee
otherwise ceases to be eligible to participate in the Plan, payroll deductions
on behalf of the employee shall be discontinued and any amounts then credited to
the employee's Payroll Deduction Account shall remain in the account and be used
to purchase Shares in accordance with paragraph 9 hereof, subject to the
limitations in paragraph 8 hereof. Any amount remaining in the Payroll Deduction
Account after the final Share Purchase Date shall be refunded to the employee as
soon as practicable.
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14. Rights Not Transferable. Rights granted under this Plan are not
transferable by a participating employee other than by will or the laws of
descent and distribution, and are exercisable during an employee's lifetime only
by the employee.
15. Employment Rights. Neither participation in the Plan, nor the
exercise of any right granted under the Plan, shall be made a condition of
employment, or of continued employment with the Company or any subsidiary.
16. Application of Funds. All funds received by the Company for
Shares sold by the Company on any Share Purchase Date pursuant to this Plan may
be used for any corporate purpose.
17. Amendments and Termination. The Board of Directors may amend the
Plan at any time, provided that no such amendment shall be effective unless
approved within 12 months after the date of the adoption of such amendment by
the affirmative vote of shareholders holding Common Shares entitled to a
majority of the votes represented by all outstanding Common Shares entitled to
vote if such shareholder approval is required for the Plan to continue to comply
with the requirements of Securities and Exchange Commission Regulation (S)
240.16b-3 and Section 423 of the Internal Revenue Code. The Board of Directors
may suspend the Plan or discontinue the Plan at any time. Upon termination of
the Plan, all payroll deductions shall cease and all amounts then credited to
the participating employees' Payroll Deduction Accounts shall be equitably
applied to the purchase of whole Shares then available for sale, and any
remaining amounts shall be promptly refunded to the participating employees.
18. Applicable Laws. This Plan, and all rights granted hereunder, are
intended to meet the requirements of an "employee stock purchase plan" under
Section 423 of the Internal Revenue Code, as from time to time amended, and the
Plan shall be construed and interpreted to accomplish this intent. Sales of
Shares under the Plan are subject to, and shall be accomplished only in
accordance with, the requirements of all applicable securities and other laws.
19. Expenses. Except to the extent provided in paragraph 12, all
expenses of administering the Plan, including expenses incurred in connection
with the purchase of Shares for sale to participating employees, shall be borne
by the Company and its subsidiaries.
20. Shareholder Approval. The Plan was adopted by the Board of
Directors on ____________, 1999, subject to shareholder approval. The Plan and
any action taken hereunder shall be null and void if shareholder approval is not
obtained at the next annual meeting of shareholders.
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