EXHIBIT 10.13
1992 EMPLOYEE STOCK PURCHASE PLAN
(AS AMENDED THROUGH OCTOBER 2001)
1. Purpose and Scope of Plan. The purpose of the 1992 Employee Stock
Purchase Plan (the "Plan") is to provide the employees of Computer Network
Technology Corporation (the "Company") and its affiliates with an opportunity to
acquire a proprietary interest in the Company through the purchase of its common
stock and, thus, to develop a stronger incentive to work for the continued
success of the Company. The Plan is intended to be an "employee stock purchase
plan" within the meaning of Section 473(b) of the Internal Revenue Code of 1986,
as amended, and shall be interpreted and administered in a manner consistent
with such intent.
2. Definitions.
2.1 Whenever used in this Plan:
(a) "Affiliate" means any parent or subsidiary
corporation of the Company as defined in Sections 424(e) and
424(f) of the Code and whose participation in the Plan has
been approved by the Board of Directors.
(b) Intentionally Omitted
(c) "Board of Directors" means the board of directors
of the Company.
(d) "Code" means the Internal Revenue Code of 1986,
as amended.
(e) "Committee" means the Compensation Committee of
the Board of Directors.
(f) "Common Stock" means the common stock, par value
$.01 per share, of the Company.
(g) "Company" means Computer Network Technology
Corporation.
(h) "Compensation" means the wages, tips and other
compensation paid to a Participant by the Company or an
Affiliate and reportable in the box designated "wages, tips,
other compensation" on Treasury Form W-2 (or any comparable
successor box or form) for the calendar year but determined
without regard to any rules that limit the remuneration
included in wages based on the nature or location of the
employment or the services performed (such as the exception
for agricultural labor in section 3401(a)(2) of the Code).
Compensation shall be determined on a cash basis. Provided,
however, that Compensation shall include elective
contributions made by the Company or an Affiliate on behalf of
a Participant that are not includible in gross income under
sections 125, 402(a)(8), 402(h), 403(b), 414(h)(2) and 457 of
the Code including elective contributions authorized by a
Participant under a cafeteria plan or any other qualified cash
or deferred arrangement under section 401(k) of the Code.
Provided, further that Compensation shall exclude all of the
following: (i) reimbursements or other expense allowances
including foreign service allowances, station allowances,
foreign tax equalization payment and other similar payments;
(ii) welfare and fringe benefits (both cash and non-cash)
including third-party sick pay (i.e., short-term and long-term
disability insurance benefits), income imputed from insurance
coverages and premiums, employee discounts and other similar
amounts, payments for vacation or sick leave accrued but not
taken, final payments on account of termination of employment
(i.e., severance payments) and settlement for accrued but
unused vacation and sick leave; (iii) moving expenses; (iv)
deferred compensation (both when deferred and when received);
(v) the Saturday Night Stay-over Program; and (vi) any income
related to the exercise of nonqualified stock options, the
sale of stock within eighteen months of receipt under the
Employee Stock Purchase Plan, the stock options received
pursuant to any Company or Affiliate stock option plan, or the
vesting of restricted stock under any Company or Affiliate
stock award plan.
(i) "Eligible Employee" means any employee of the
Company or an Affiliate whose customary employment is (i) at
least 20 hours per week and (ii) for more than 5 months in any
calendar year, provided, however, that "Eligible Employee"
shall not include any person who would be deemed for purposes
of Section 423(b)(3) of the Code to own stock possessing 5% or
more of the total combined voting power or value of all
classes of stock of the Company.
(j) Intentionally Omitted
(k) "Fair Market Value" as of any date means:
(i) the closing sale price of a share of
Common Stock on the date specified or, if no sale of
shares of Common Stock shall have occurred on that
date, on the next preceding day on which a sale
occurred of shares on the National Association of
Securities Dealers Inc. Automated Quotations National
Market System ("NMS"), or
(ii) if the shares of Common Stock are not
quoted on the NMS, what the Committee determines in
good faith to be the fair market value of a share of
Common Stock on that date.
If such determination of Fair Market Value is not consistent
with the then current regulations of the Secretary of the
Treasury applicable to plans intended to qualify as an
"employee stock purchase plan" within the meaning of Section
423(b) of the Code, Fair Market Value shall be determined in
accordance with said regulations. The determination of Fair
Market Value shall be subject to adjustment as provided in
Section 14 hereof.
(l) "Participant" means an Eligible Employee who has
elected to participate in the Plan in the manner set forth in
Section 4.
(m) "Plan" means this 1992 Employee Stock Purchase
Plan.
(n) "Purchase Period" through November 30, 2001,
means each six-month period ending on November 30 and May 31;
and commencing December 1, 2001, means the period from
December 1, 2001 and ending June 30, 2002; and thereafter,
each six month period ending on June 30 and December 31 during
the remainder of the term of this Plan.
(o) "Stock Purchase Account" means the account
maintained in the books and records of the Company recording
the amount withheld from each Participant through payroll
deductions made under the Plan.
3. Scope of the Plan. Options to purchase shares of Common Stock may be
granted by the Company to Eligible Employees during the period commencing July
1, 1992 and ending June 30, 2012 as hereinafter provided, but not more than
1,100,000 shares of Common Stock (1,500,000 shares of Common Stock, effective
October 30, 2001, but subject to shareholder approval at the next scheduled
shareholder meeting) shall be purchased pursuant to such options. Shares shall
be subject to adjustment as provided in Section 14 hereof. Provided, however,
that if shareholder approval is not obtained for the increase in the number of
shares available for issuance under the Plan from 1,100,000 to 1,500,000, then
in the final Purchase Period for which Common Stock is available for purchase
under the Plan the shares then available (determined without regard to the
increase in available shares) shall be allocated among the Participants pro-rata
based on the relative amount of contributions made by each during the Purchase
Period, with any amount not used to purchase Common Stock refunded to the
Participant in cash. All options granted pursuant to this Plan shall be subject
to the same terms, conditions, rights, and privileges. The shares of Common
Stock delivered by the Company pursuant to this Plan may be acquired shares
having the status of authorized but unissued shares, newly issued shares, or
both.
4. Eligibility and Participation. To be eligible to participate in this
Plan for a given Purchase Period, an employee must be an Eligible Employee on
the first day of such Purchase Period. An Eligible Employee may elect to
participate in the Plan by filing an enrollment form with the Committee in
advance of the Purchase Period that authorizes regular payroll deductions from
Compensation beginning with the first payday in the Purchase Period and
continuing until the Eligible Employee withdraws from the Plan or ceases to be
an Eligible Employee.
5. Amount of Common Stock Each Eligible Employee May Purchase.
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5.1 Subject to the provisions of this Plan, each Eligible
Employee shall be offered the option to purchase on the last day of the
Purchase Period the largest number of whole shares of Common Stock that
can be purchased at the price specified in Section 5.2 hereof with the
entire credit balance in the Participant's Stock Purchase Account:
provided however, that no more than the lesser of (i) 2,500 shares of
Common Stock and other stock for each Purchase Period or (ii) $25,000
in Fair Market Value (determined at the beginning of each Purchase
Period) of shares of Common Stock and other stock may be purchased
under this Plan and all other employee stock purchase plans (if any) of
the Company and the Affiliates by any Participant for each calendar
year. If the purchases by all Participants would otherwise cause the
aggregate number of shares of Common Stock to be sold under the Plan to
exceed the number specified in Section 3 hereof, however, each
Participant shall be allocated a ratable portion of the maximum number
of shares of Common Stock which may be sold.
5.2 The purchase price of each share of Common Stock sold
pursuant to this Plan will be the lesser of (i) 85% of the Fair Market
Value of such share on the first business day of the Purchase Period or
(ii) 85% of the Fair Market Value of such share on the last business
day of the Purchase Period.
6. Method of Participation.
6.1 The Committee shall give notice to Eligible Employees of
each offering of options to purchase shares of Common Stock pursuant to
this Plan and the terms and conditions for each offering. Such notice
is subject to revision by the Company at any time prior to the date of
grant of the option. The first day of a Purchase Period is the date
contemplated by the Company as the date of grant of the option to
purchase such shares.
6.2 Each Eligible Employee who desires to participate in the
Plan for a Purchase Period shall signify his or her election to do so
by signing an election form developed by the Committee. An Eligible
Employee may elect withholding from Compensation in any whole
percentage from 0% to 10%. Notwithstanding the foregoing, a Participant
may not withhold more than $5,000 in the aggregate during each Purchase
Period. An election to participate in the Plan and to authorize payroll
deductions as described herein must be made before the commencement of
the Purchase Period to which it relates and shall remain in effect
unless and until such Participant withdraws from this Plan, modifies
his or her authorization, or terminates his or her employment with the
Company as hereinafter provided.
6.3 Any Eligible Employee who does not make a timely election
as provided in Section 6.2 hereof shall be deemed to have elected not
to participate in the Plan. Such election shall be irrevocable for such
Purchase Period.
7. Stock Purchase Account.
7. 1 The Company shall maintain a Stock Purchase Account for
each Participant. Payroll deductions pursuant to Section 6 hereof will
be credited to such Stock Purchase Accounts on each payday.
7.2 No interest will be credited to a Participant's Stock
Purchase Account.
7.3 The Stock Purchase Account is established solely for
accounting purposes, and all amounts credited to the Stock Purchase
Account will remain part of the general assets of the Company.
7.4 A Participant may not make any separate cash payment into
his or her Stock Purchase Account.
8. Right to Reduce Participation or to Withdraw.
8.1 A Participant may, at any time during a Purchase Period,
direct the Company to make no further deductions from his or her
Compensation or to reduce the amount of such deductions. Upon either of
such actions, future payroll deductions with respect to such
Participant shall cease or be reduced in accordance with the
Participant's direction.
8.2 Any Participant who stops payroll deductions may not
thereafter resume payroll deductions for the Purchase Period, and any
Participant who decreases payroll deductions may not thereafter further
decrease or increase such deductions, except that he or she may stop
further deductions.
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8.3 At any time before the end of a Purchase Period, any
Participant may also withdraw from the Plan. In such event, all future
payroll deductions shall cease and the entire credit balance in the
Participant's Stock Purchase Account will be paid to the Participant,
without interest, in cash within 60 days. A Participant who withdraws
from the Plan will not be eligible to reenter the Plan until the next
succeeding Purchase Period.
8.4 Notification of a Participant's election to reduce or
terminate deductions, or to withdraw from the Plan, shall be made by
the filing of an appropriate notice to such effect with the Committee.
9. Termination of Employment.
9.1 If the employment of a Participant is terminated prior to
conclusion of the Purchase Period because of death, permanent
disability, or retirement at or after age 65, or earlier with the
consent of the Committee, the Participant or his or her legal
representative, as applicable, may either:
(a) withdraw from the Plan, in which event the
Company shall refund in cash the entire balance in the
Participant's Stock Purchase Account; or
(b) elect to receive a distribution of only a portion
of his or her Stock Purchase Account, in which event the
Company shall refund such portion in cash and shall leave the
balance of the Stock Purchase Account to be applied at the end
of the Purchase Period towards the acquisition of shares of
Common Stock as provided in Section 10 hereof.
9.2 The election of a Participant or his or her legal
representative, as applicable, pursuant to Section 9.1 shall be made
within three months of the event causing the termination of employment,
but not (except in the case of death) later than the conclusion of the
Purchase Period. Notification of the election shall be filed with the
Committee and, in the event no notification has been filed within the
prescribed period, the Participant shall be deemed to have elected to
withdraw from the Plan in accordance with Section 9.l(a) hereof.
9.3 If the employment of a Participant is terminated for any
reason other than those specified in Section 9.1 hereof, the Company
shall refund in cash all amounts credited to his or her Stock Purchase
Account.
10. Exercise of Option and Purchase of Shares.
10.1 As of the last day of the Purchase Period, the entire
credit balance in each Participant's Stock Purchase Account will be
used to purchase the largest number of whole shares of Common Stock
purchasable with such amount (subject to the limitations of Section 5
hereof) unless the Participant has filed an appropriate form with the
Committee in advance of that date (which either elects to purchase a
specified number of whole shares which is less than the number
described above or elects to receive the entire credit balance in
cash).
10.2 Any amount remaining in a Participant's Stock Purchase
Account after such purchase (or the entire credit balance if the
Participant elected not to purchase any shares) will be paid to the
Participant in cash within 60 days after the end of the Purchase
Period.
10.3 As soon as practicable after the close of the Purchase
Period, certificates for the number of whole shares of Common Stock,
determined as aforesaid, purchased by each Participant shall be issued
and delivered to him or her.
11. Rights as a Stockholder. A Participant shall not be entitled to any
of the rights or privileges of a stockholder of the Company with respect to such
shares, including the right to receive any dividends which may be declared by
the Company, until he or she actually has paid the purchase price for such
shares and certificates have been issued to him or her in accordance with
Section 10.
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12. Rights Not Transferable. A Participant's rights under this Plan are
exercisable only by the Participant during his or her lifetime, and may not be
sold, pledged, assigned, or transferred in any manner other than by will or the
laws of descent and distribution. Any attempt to sell, pledge, assign, or
transfer the same shall be null and void and without effect. The amounts
credited to a Stock Purchase Account may not be assigned, transferred, pledged,
or hypothecated in any way, and any attempted assignment, transfer, pledge,
hypothecation, or other disposition of such amounts will be null and void and
without effect.
13. Administration of the Plan.
13.1 This Plan shall be administered by the Committee, which
is authorized to make such uniform rules as may be necessary to carry
out its provisions. The Committee shall determine any questions arising
in the administration, interpretation, and application of this Plan,
and all such determinations shall be conclusive and binding on all
parties.
13.2 If any option granted under this Plan shall lapse or
terminate unexercised, the number of shares of Common Stock covered
thereby shall again become available for sale under this Plan.
14. Adjustment Upon Changes in Capitalization. In the event or any
change in the Common Stock of the Company by reason of stock dividends, stock
splits, corporate separations, recapitalizations, mergers, consolidations,
combinations, exchanges of shares, and the like, the aggregate number and class
of shares available under this Plan and the number, class, and purchase price of
shares under option but not yet purchased under this Plan, shall be adjusted
appropriately by the Committee.
15. Registration of Certificate. Stock certificates will be registered
in the name of the Participant, or jointly in the name of the Participant and
another person, as the Participant may direct on an appropriate form.
16. Amendment of Plan. The Board of Directors may at any time amend
this Plan in any respect which shall not adversely affect the rights of
Participants pursuant to options accepted under this Plan, except that, without
stockholder approval on the same basis as required by Section 19.1, no amendment
shall be made (i) to increase the number of shares to be reserved under this
Plan, (ii) to decrease the minimum purchase price, (iii) to withdraw the
administration of this Plan from the Committee, or (iv) to change the definition
of employees eligible to participate in the Plan.
17. Effective Date of Plan. This Plan shall consist of an offering
commencing July 1, 1992 and ending May 31, 1993 and thereafter 4 consecutive
annual offerings beginning on June 1 of each year and ending on May 31 of the
subsequent year; and commencing June 1, 1997 and ending November 30, 2001, 9
consecutive six-month offerings beginning on June 1 and December 1; and
commencing December 1, 2001 and ending June 30, 2002, a seven month offering
period; and thereafter, 20 consecutive six month periods ending on December 31
and June 30 during the remainder of the term of this Plan. All rights of
Participants in any offering hereunder shall terminate at the earlier of the
conclusion of the last Purchase Period authorized herein on June 30, 2012 or:
17.1 On the day that Participants become entitled to purchase
a number of shares of Common Stock equal to or greater than the number
of shares remaining available for purchase;
17.2 At any time, at the discretion of the Board of Directors,
after 30 days' notice has been given to all Participants.
Upon termination of this Plan, shares of Common Stock in accordance with Section
10 shall be issued to Participants, and cash, if any, remaining in the
Participants' Stock Purchase Accounts shall be refunded to them, as if the Plan
were terminated at the end of a Purchase Period.
18. Governmental Regulations and Listing. All rights granted or to be
granted to Eligible Employees under this Plan are expressly subject to all
applicable laws and regulations and to the approval of all governmental
authorities required in connection with the authorization, issuance, sale, or
transfer of the shares of Common Stock reserved for this Plan, including,
without limitation, there being a current registration statement of the Company
under the Securities Act of 1933 as amended, covering the shares of Common Stock
purchasable under options on the last day of the Purchase Period applicable to
such options, and if such a registration statement shall not then be effective,
the term of such options and the Purchase Period shall be extended until the
first business day after the effective date of such a registration statement, or
post-effective amendment thereto. If applicable, all such rights hereunder are
also similarly subject to effectiveness of an appropriate listing application to
the National Association of Securities Dealers, Inc. covering the shares of
Common Stock under the Plan upon official notice of issuance.
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19. Miscellaneous.
19.1 This Plan shall be submitted for approval by the
stockholders of the Company prior to May 31, 1992. If not so approved
prior to such date, this Plan shall terminate on June 1, 1992.
19.2 This Plan shall not be deemed to constitute a contract of
employment between the Company and Participant, nor shall it interfere
with the right of the Company to terminate any Participant and treat
him or her without regard to the effect which such treatment might have
upon him or her under this Plan.
19.3 Wherever appropriate as used herein, the masculine gender
may be read as the feminine gender, the feminine gender may be read as
the masculine gender, the singular may be read as the plural, and the
plural may be read as the singular.
19.4 This Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of
Minnesota.
19.5 Delivery of shares of Common Stock or of cash pursuant to
this Plan shall be subject to any required withholding taxes. A person
entitled to receive shares of Common Stock may, as a condition
precedent to receiving such shares, be required to pay the Company a
cash amount equal to the amount of any required withholdings.
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