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EXHIBIT 10.14
INSIGHT ENTERPRISES, INC.
1999 BROAD BASED EMPLOYEE STOCK OPTION PLAN
ARTICLE 1 PURPOSE
1.1 GENERAL. The purpose of the Insight Enterprises, Inc. 1999 Broad Based
Employee Stock Option Plan (the "Plan") is to promote the success, and enhance
the value, of Insight Enterprises, Inc. (the "Company") by linking the personal
interests of its employees to those of Company shareholders and by providing its
employees with an incentive for outstanding performance. The Plan is further
intended to provide flexibility to the Company in its ability to motivate,
attract, and retain the services of employees upon whose judgment, interest, and
special effort the successful conduct of the Company's operation is dependent.
Accordingly, the Plan permits the grant of stock option awards from time to time
to employees.
ARTICLE 2 EFFECTIVE DATE
2.1 EFFECTIVE DATE. The Plan is effective as of September 28, 1999 (the
"Effective Date").
ARTICLE 3 DEFINITIONS AND CONSTRUCTION.
3.1 DEFINITIONS. When a word or phrase appears in this Plan with the initial
letter capitalized, and the word or phrase does not commence a sentence, the
word or phrase shall generally be given the meaning ascribed to it in this
Section or in Sections 1.1 or 2.1 unless a clearly different meaning is required
by the context. The following words and phrases shall have the following
meanings:
(a) "Board" means the Board of Directors of the Company.
(b) "Change of Control" means and includes each of the following (except
as otherwise provided in an Option Agreement):
(1) When the individuals who, at the beginning of any period of two
years or less, constituted the Board of Directors of the Company cease,
for any reason, to constitute at least a majority thereof, unless the
election or nomination for election of each new director was approved by
the vote of at least two-thirds of the directors then still in office who
were directors at the beginning of such period;
(2) A change of control of the Company through a transaction or
series of transactions, such that any person (as that term is used in
Section 13 and 14(d)(2) of the 1934 Act), excluding affiliates of the
Company as of the Effective Date, is or becomes the beneficial owner (as
that term is used in Section 13(d) of the 1934 Act) directly or indirectly
of securities of the Company representing 30% or more of the combined
voting power of the Company's then outstanding securities;
(3) Any consolidation or liquidation of the Company in which the
Company is not the continuing or surviving corporation or pursuant to
which Stock would be converted into cash, securities or other property,
other than a merger of the Company in which the holders of the shares of
Stock immediately before the merger have the same proportionate ownership
of common stock of the surviving corporation immediately after the merger;
(4) The stockholders of the Company approve any plan or proposal for
the liquidation or dissolution of the Company; or
(5) Substantially all of the assets of the Company are sold or
otherwise transferred to parties that are not within a "controlled group
of corporations" (as defined in Section 1563 of the Code) of which the
Company is a member.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means the committee of the Board described in Article 4.
(e) "Disability" means any illness or other physical or mental condition
of a Participant which renders the Participant incapable of performing his
customary and usual duties for the Company, or any medically determinable
illness or other physical or mental condition resulting from a bodily injury,
disease or mental disorder which in the judgment of the Committee is permanent
and continuous in nature. The Committee may require such medical or other
evidence as it deems necessary to judge the nature and permanency of the
Participant's condition.
(f) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(g) "Fair Market Value" means, as of any given date, the fair market value
of Stock or other property on a particular date determined by such methods or
procedures as may be established from time to time by the Committee. Unless
otherwise determined by the Committee, the Fair Market Value of Stock as of any
date shall be the closing price for the Stock as reported on the NASDAQ National
Market System (or on any national securities exchange on which the Stock is then
listed) for that date or, if no closing price is so reported for that date, the
closing price on the next preceding date for which a closing price was reported.
(h) "Officer" means any employee of the Company or a Subsidiary holding
the title of Vice President or higher or any other person designated by the
Board as an officer of the Company or a Subsidiary.
(i) "Option" means an option to purchase Stock that is not intended to be
an "incentive stock option" under Section 422 of the Code and that is granted to
a Participant under Article 7.
(j) "Option Agreement" means any written agreement, contract, or other
instrument or document evidencing an Option.
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(k) "Participant" means a person who, as an employee of the Company or any
Subsidiary, has been granted an Option under the Plan.
(l) "Plan" means the Insight Enterprises, Inc. 1999 Broad Based Employee
Stock Option Plan, as amended from time to time.
(m) "Retirement" means a Participant's termination of employment with the
Company after attaining any normal or early retirement age specified in any
pension, profit sharing, or other retirement program sponsored by the Company.
(n) "Stock" means the common stock of the Company and such other
securities of the Company that may be substituted for Stock pursuant to Article
9.
(o) "Subsidiary" means any corporation of which a majority of the
outstanding voting stock or voting power is beneficially owned directly or
indirectly by the Company.
ARTICLE 4 ADMINISTRATION
4.1 COMMITTEE. The Plan shall be administered by a Committee that is appointed
by, and shall serve at the discretion of, the Board; provided, however, that the
Chief Executive Officer of the Company shall have the authority to grant Options
to individuals who are not subject to Section 16 of the Securities Exchange Act
of 1934 and to those individuals who are subject to Section 16 (other than the
three highest ranking executives of the Company), provided that any grant to a
Section 16 insider shall not become exercisable for at least six months from the
date of grant. When the Chief Executive Officer is acting to grant Options under
this Plan, solely for purposes of this Plan, the Chief Executive Officer shall
be deemed to be acting as the Committee.
4.2 ACTION BY THE COMMITTEE. A majority of the Committee shall constitute a
quorum. The acts of a majority of the members present at any meeting at which a
quorum is present and acts approved in writing by a majority of the Committee in
lieu of a meeting shall be deemed the acts of the Committee. Each member of the
Committee is entitled to, in good faith, rely or act upon any report or other
information furnished to that member by any officer or other employee of the
Company or any Subsidiary, the Company's independent certified public
accountants, or any executive compensation consultant or other professional
retained by the Company to assist in the administration of the Plan.
4.3 AUTHORITY OF COMMITTEE. The Committee has the exclusive power, authority
and discretion to:
(a) Designate Participants to receive Options;
(b) Determine the number of Options to be granted and the number of shares
of Stock to which an Option will relate;
(c) Determine the terms and conditions of any Option granted under the
Plan, including but not limited to the purchase price (if any), any restrictions
or limitations on the Option, any schedule for vesting or the lapse of
forfeiture restrictions of an Option, and accelerations or waivers thereof,
based in each case on such considerations as the Committee in its sole
discretion determines;
(d) Determine whether, to what extent, and under what circumstances an
Option may be settled in, or the purchase price of an Option may be paid in,
cash, Stock, other Options, or other property, or an Option may be canceled,
forfeited, or surrendered;
(e) Prescribe the form of each Option Agreement, which need not be
identical for each Participant;
(f) Decide all other matters that must be determined in connection with an
Option;
(g) Establish, adopt or revise any rules and regulations as it may deem
necessary or advisable to administer the Plan; and
(h) Make all other decisions and determinations that may be required under
the Plan or as the Committee deems necessary or advisable to administer the
Plan.
4.4 DECISIONS BINDING. The Committee's interpretation of the Plan, any Options
granted under the Plan, any Option Agreement and all decisions and
determinations by the Committee with respect to the Plan are final, binding, and
conclusive on all parties.
ARTICLE 5 SHARES SUBJECT TO THE PLAN
5.1 NUMBER OF SHARES. Subject to adjustment provided in Section 9.1, the
aggregate number of shares of Stock reserved and available for Options shall be
1,000,000; provided, however, that no more than 20% of the Shares of Stock
available under the Plan may be awarded to Officers.
5.2 LAPSED OPTIONS. To the extent that an Option terminates, expires, or
lapses for any reason, any shares of Stock subject to the Option will again be
available for the grant of an Option under the Plan.
5.3 STOCK DISTRIBUTED. Any Stock distributed pursuant to an Option may
consist, in whole or in part, of authorized and unissued Stock, treasury Stock
or Stock purchased on the open market.
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ARTICLE 6 ELIGIBILITY AND PARTICIPATION
6.1 ELIGIBILITY.
(a) GENERAL. Persons eligible to participate in the Plan include all
employees of the Company or a Subsidiary, as determined by the Committee;
provided, however, that the Plan is intended to be a broad-based plan and,
therefore, no more than 20% of the total shares of Stock available under the
Plan may be awarded to Officers.
(b) FOREIGN EMPLOYEES. In order to assure the viability of Awards granted
to Participants employed in foreign countries, the Committee may provide for
such special terms as it may consider necessary or appropriate to accommodate
differences in local law, tax policy, or custom. Moreover, the Committee may
approve such supplements to, or amendments, restatements, or alternative
versions of the Plan as it may consider necessary or appropriate for such
purposes without thereby affecting the terms of the Plan as in effect for any
other purpose; provided, however, that no such supplements, amendments,
restatements, or alternative versions shall increase the share limitations
contained in Section 5.1 of the Plan.
6.2 PARTICIPATION. Subject to the provisions of the Plan, the Committee may,
from time to time, select from among all eligible individuals, those to whom
Options will be granted.
ARTICLE 7 STOCK OPTIONS
7.1 GENERAL. The Committee is authorized to grant Options to Participants on
the following terms and conditions:
(a) EXERCISE PRICE. The exercise price per share of Stock under an Option
shall be determined by the Committee and set forth in the Option Agreement. It
is the intention under the Plan that the exercise price for any Option shall not
be less than the Fair Market Value as of the date of grant; provided, however,
that the Committee may, in its discretion, grant Options with an exercise price
of less than Fair Market Value on the date of grant.
(b) TIME AND CONDITIONS OF EXERCISE. The Committee shall determine the
time or times at which an Option may be exercised in whole or in part. The
Committee also shall determine the performance or other conditions, if any, that
must be satisfied before all or part of an Option may be exercised.
(c) LAPSE OF OPTION. An Option shall lapse under the following
circumstances:
(1) The Option shall lapse 10 years after it is granted, unless an
earlier time is set in the Option Agreement.
(2) The Option shall lapse three months after the Participant's
termination of employment, if the termination of employment was
attributable to (i) Disability, (ii) Retirement, or (iii) for any other
reason, provided that the Committee has approved, in writing, the
continuation of any Option outstanding on the date of the Participant's
termination of employment.
(3) If the Participant separates from employment other than as
provided in paragraph (2), the Option shall lapse seven days following the
Participant's termination of employment.
(4) If the Participant dies before the Option lapses pursuant to
paragraph (1), (2) or (3), above, the Option shall lapse, unless it is
previously exercised, on the earlier of (i) the date on which the Option
would have lapsed had the Participant lived and had his employment status
(i.e., whether the Participant was employed by the Company on the date of
his death or had previously terminated employment) remained unchanged; or
(ii) 12 months after the date of the Participant's death. Upon the
Participant's death, any Options exercisable at the Participant's death
may be exercised by the Participant's legal representative or
representatives, by the person or persons entitled to do so under the
Participant's last will and testament, or, if the Participant shall fail
to make testamentary disposition of such Option or shall die intestate, by
the person or persons entitled to receive the Option under the applicable
laws of descent and distribution.
(d) PAYMENT. The Committee shall determine the methods by which the
exercise price of an Option may be paid, the form of payment, including, without
limitation, cash, shares of Stock, or other property (including broker assisted
"cashless exercise" arrangements), and the methods by which shares of Stock
shall be delivered or deemed to be delivered to Participants.
(e) EVIDENCE OF GRANT. All Options shall be evidenced by a written Award
Agreement between the Company and the Participant. The Option Agreement shall
include such provisions as may be specified by the Committee.
ARTICLE 8 PROVISIONS APPLICABLE TO OPTIONS
8.1 STAND-ALONE, TANDEM, AND SUBSTITUTE AWARDS. Awards granted under the Plan
may, in the discretion of the Committee, be granted either alone or in addition
to, in tandem with, or in substitution for, any other Award granted under the
Plan. If an Award is granted in substitution for another Award, the Committee
may require the surrender of such other Award in consideration of the grant of
the new Award. Awards granted in addition to or in tandem with other Awards may
be granted either at the same time as or at a different time from the grant of
such other Awards.
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8.2 EXCHANGE PROVISIONS. The Committee may at any time offer to exchange or
buy out any previously granted Option for a payment in cash, Stock, or another
Option (subject to Section 8.1), based on the terms and conditions the Committee
determines and communicates to the Participant at the time the offer is made.
8.3 TERM OF OPTION. The term of each Option shall be for the period as
determined by the Committee.
8.4 FORM OF PAYMENT FOR OPTIONS. Subject to the terms of the Plan and any
applicable law or Option Agreement, payments or transfers to be made by the
Company or a Subsidiary on the grant of an Option or at the time the
restrictions on the Option lapse may be made in such forms as the Committee
determines at or after the time of grant, including without limitation, cash,
Stock, other Options, other property, or any combination, and may be made in a
single payment or transfer, in installments, or on a deferred basis, in each
case determined in accordance with rules adopted by, and at the discretion of,
the Committee.
8.5 LIMITS ON TRANSFER. No right or interest of a Participant in any Option may
be pledged, encumbered, or hypothecated to or in favor of any party other than
the Company or a Subsidiary, or shall be subject to any lien, obligation, or
liability of such Participant to any other party other than the Company or a
Subsidiary. Except as otherwise provided by the Committee, no Option shall be
assignable or transferable by a Participant other than by will or the laws of
descent and distribution.
8.6 BENEFICIARIES. Notwithstanding Section 8.5, a Participant may, in the
manner determined by the Committee, designate a beneficiary to exercise the
rights of the Participant and to receive any distribution with respect to any
Option upon the Participant's death. A beneficiary, legal guardian, legal
representative, or other person claiming any rights under the Plan is subject to
all terms and conditions of the Plan and any Option Agreement applicable to the
Participant, except to the extent the Plan and Option Agreement otherwise
provide, and to any additional restrictions deemed necessary or appropriate by
the Committee. If the Participant is married, a designation of a person other
than the Participant's spouse as his beneficiary with respect to more than 50
percent of the Participant's interest in the Option shall not be effective
without the written consent of the Participant's spouse. If no beneficiary has
been designated or survives the Participant, payment shall be made to the person
entitled thereto under the Participant's will or the laws of descent and
distribution. Subject to the foregoing, a beneficiary designation may be changed
or revoked by a Participant at any time provided the change or revocation is
filed with the Committee.
8.7 STOCK CERTIFICATES. All Stock certificates delivered under the Plan are
subject to any stop-transfer orders and other restrictions as the Committee
deems necessary or advisable to comply with federal or state securities laws,
rules and regulations and the rules of any national securities exchange or
automated quotation system on with the Stock is listed, quoted, or traded. The
Committee may place legends on any Stock certificate to reference restrictions
applicable to the Stock.
8.8 CHANGE OF CONTROL. If a Change of Control occurs, all outstanding Options
shall become fully exercisable and all restrictions on outstanding Options shall
lapse. Upon, or in anticipation of, such an event, the Committee may cause every
Option outstanding hereunder to terminate at a specific time in the future and
shall give each Participant the right to exercise Options during a period of
time as the Committee, in its sole and absolute discretion, shall determine,
except in the event that the surviving or resulting entity agrees to assume the
Options on terms and conditions that substantially preserve the Participant's
rights and benefits of the Option then outstanding.
ARTICLE 9 CHANGES IN CAPITAL STRUCTURE
9.1 GENERAL. In the event a stock dividend is declared upon the Stock, the
shares of Stock then subject to each Option shall be increased proportionately
without any change in the aggregate purchase price therefor. In the event the
Stock shall be changed into or exchanged for a different number or class of
shares of Stock or of another corporation, whether through reorganization,
recapitalization, stock split-up, combination of shares, merger or
consolidation, there shall be substituted for each such share of Stock then
subject to each Option the number and class of shares of Stock into which each
outstanding share of Stock shall be so exchanged, all without any change in the
aggregate purchase price for the shares then subject to each Option.
ARTICLE 10 AMENDMENT, MODIFICATION AND TERMINATION
10.1 AMENDMENT, MODIFICATION AND TERMINATION. With the approval of the Board,
at any time and from time to time, the Committee may terminate, amend or modify
the Plan.
10.2 OPTIONS PREVIOUSLY GRANTED. No termination, amendment, or modification of
the Plan shall adversely affect in any material way any Option previously
granted under the Plan, without the written consent of the Participant.
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ARTICLE 11 GENERAL PROVISIONS
11.1 NO RIGHTS TO OPTIONS. No person shall have any right to be granted any
Option under the Plan, and neither the Company nor the Committee is obligated to
treat Participants and employees uniformly.
11.2 NO STOCKHOLDERS RIGHTS. No Option gives the Participant any of the rights
of a stockholder of the Company unless and until shares of Stock are in fact
issued to such person in connection with such Option.
11.3 WITHHOLDING. The Company or any Subsidiary shall have the authority and
the right to deduct or withhold, or require a Participant to remit to the
Company, an amount sufficient to satisfy Federal, state, and local taxes
(including the Participant's FICA obligation) required by law to be withheld
with respect to any taxable event arising as a result of this Plan.
11.4 NO RIGHT TO EMPLOYMENT. Nothing in the Plan or any Option Agreement shall
interfere with or limit in any way the right of the Company or any Subsidiary to
terminate any Participant's employment at any time, nor confer upon any
Participant any right to continue in the employ of the Company or any
Subsidiary.
11.5 UNFUNDED STATUS OF OPTIONS. The Plan is intended to be an "unfunded" plan
for incentive compensation. With respect to any payments not yet made to a
Participant pursuant to an Option, nothing contained in the Plan or any Option
Agreement shall give the Participant any rights that are greater than those of a
general creditor of the Company or any Subsidiary.
11.6 INDEMNIFICATION. To the extent allowable under applicable law, each member
of the Committee or of the Board shall be indemnified and held harmless by the
Company from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by such member in connection with or resulting from any
claim, action, suit, or proceeding to which the member may be a party or in
which the member may be involved by reason of any action or failure to act under
the Plan and against and from any and all amounts paid by the member in
satisfaction of judgment in such action, suit, or proceeding against the member
provided the member gives the Company an opportunity, at its own expense, to
handle and defend the same before the member undertakes to handle and defend it
on the member's behalf. The foregoing right of indemnification shall not be
exclusive of any other rights of indemnification to which such persons may be
entitled under the Company's Articles of Incorporation or By-Laws, as a matter
of law, or otherwise, or any power that the Company may have to indemnify them
or hold them harmless.
11.7 RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan shall be taken
into account in determining any benefits under any pension, retirement, savings,
profit sharing, group insurance, welfare or other benefit plan of the Company or
any Subsidiary.
11.8 EXPENSES. The expenses of administering the Plan shall be borne by the
Company and its Subsidiaries.
11.9 TITLES AND HEADINGS. The titles and headings of the Sections in the Plan
are for convenience of reference only, and in the event of any conflict, the
text of the Plan, rather than such titles or headings, shall control.
11.10 FRACTIONAL SHARES. No fractional shares of Stock shall be issued and the
Committee shall determine, in its discretion, whether cash shall be given in
lieu of fractional shares or whether such fractional shares shall be eliminated
by rounding up or down.
11.11 SECURITIES LAW COMPLIANCE. With respect to any person who is, on the
relevant date, obligated to file reports under Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the Exchange Act. To the extent
any provision of the Plan or action by the Committee fails to so comply, it
shall be voidable as deemed advisable by the Committee.
11.12 GOVERNMENT AND OTHER REGULATIONS. The obligation of the Company to make
payment of Options in Stock or otherwise shall be subject to all applicable
laws, rules, and regulations, and to such approvals by government agencies as
may be required. The Company shall be under no obligation to register under the
Securities Act of 1933, as amended (the "1933 Act"), any of the shares of Stock
paid under the Plan. If the shares paid under the Plan may in certain
circumstances be exempt from registration under the 1933 Act, the Company may
restrict the transfer of such shares in such manner as it deems advisable to
ensure the availability of any such exemption.
11.13 GOVERNING LAW. The Plan and all Option Agreements shall be construed in
accordance with and governed by the laws of the State of Delaware.
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IN WITNESS WHEREOF, the Company has caused this Plan to be executed by its duly
authorized representative on this 28th day of September, 1999.
INSIGHT ENTERPRISES, INC.
By: /s/ Eric J. Crown
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Its: Chief Executive Officer
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