EXHIBIT 10.48
EQUINIX, INC.
2001 Supplemental Stock Plan
(As Adopted SEPTEMBER 26, 2001)
TABLE OF CONTENTS
Page
ARTICLE I. INTRODUCTION ........................................... 1
ARTICLE II. ADMINISTRATION ......................................... 1
2.1 Committee Composition .................................. 1
2.2 Committee Responsibilities ............................. 1
ARTICLE III. SHARES AVAILABLE FOR GRANTS ............................ 1
3.1 Basic Limitation ....................................... 1
3.3 Additional Shares ...................................... 1
3.4 Dividend Equivalents ................................... 2
ARTICLE IV. ELIGIBILITY ............................................ 2
4.1 Other Grants ........................................... 2
ARTICLE V. OPTIONS ................................................ 2
5.1 Stock Option Agreement ................................. 2
5.2 Number of Shares ....................................... 2
5.3 Exercise Price ......................................... 2
5.4 Exercisability and Term ................................ 2
5.5 Modification or Assumption of Options .................. 2
5.6 Buyout Provisions ...................................... 2
ARTICLE VI. PAYMENT FOR OPTION SHARES .............................. 3
6.1 General Rule ........................................... 3
6.2 Surrender of Stock ..................................... 3
6.3 Exercise/Sale .......................................... 3
6.4 Exercise/Pledge ........................................ 3
6.5 Promissory Note ........................................ 3
6.6 Other Forms of Payment ................................. 3
ARTICLE VII. RESTRICTED SHARES ...................................... 4
7.1 Restricted Stock Agreement ............................. 4
7.2 Payment for Awards ..................................... 4
7.3 Vesting Conditions ..................................... 4
7.4 Voting and Dividend Rights ............................. 4
ARTICLE VIII. CHANGE IN CONTROL ........................ 4
8.1 Effect of Change in Control ............................ 4
8.2 Involuntary Termination ................................ 4
ARTICLE IX. PROTECTION AGAINST DILUTION ............................ 5
9.1 Adjustments5
i
9.2 Dissolution or Liquidation .......................... 5
9.3 Reorganizations ..................................... 5
ARTICLE X. DEFERRAL OF AWARDS .................................. 5
ARTICLE XI. LIMITATION ON RIGHTS ................................ 6
11.1 Retention Rights .................................... 6
11.2 Stockholders' Rights ................................ 6
11.3 Regulatory Requirements ............................. 6
ARTICLE XII. WITHHOLDING TAXES ................................... 6
12.1 General ............................................. 6
12.2 Share Withholding ................................... 6
ARTICLE XIII. FUTURE OF THE PLAN .................... 7
13.1 Term of the Plan .................................... 7
13.2 Amendment or Termination ............................ 7
ARTICLE XIV. DEFINITIONS ......................................... 7
ii
EQUINIX, INC.
2001 Supplemental Stock Plan
ARTICLE I INTRODUCTION.
The Plan was adopted by the Board to be effective on September 26,
2001. The purpose of the Plan is to promote the long-term success of the Company
and the creation of stockholder value by (a) encouraging Employees and
Consultants to focus on critical long-range objectives, (b) encouraging the
attraction and retention of Employees and Consultants with exceptional
qualifications, and (c) linking Employees and Consultants directly to
stockholder interests through increased stock ownership. The Plan seeks to
achieve this purpose by providing for awards in the form of Restricted Shares or
Options (which shall be nonstatutory stock options).
The Plan shall be governed by, and construed in accordance with, the
laws of the State of Delaware (except their choice-of-law provisions).
ARTICLE II ADMINISTRATION.
2.1 Committee Composition. The Plan shall be administered by the
Committee. The Committee shall consist exclusively of one or more directors of
the Company, who shall be appointed by the Board.
2.2 Committee Responsibilities. The Committee shall (a) select the
Employees and Consultants who are to receive awards under the Plan, (b)
determine the type, number, vesting requirements and other features and
conditions of such awards, (c) interpret the Plan and (d) make all other
decisions relating to the operation of the Plan. The Committee may adopt such
rules or guidelines as it deems appropriate to implement the Plan. The
Committee's determinations under the Plan shall be final and binding on all
persons.
ARTICLE III SHARES AVAILABLE FOR GRANTS.
3.1 Basic Limitation. Shares of Common Stock issued pursuant to the
Plan may be authorized but unissued shares or treasury shares or re-acquired
shares. The aggregate number of Options and Restricted Shares awarded under the
Plan shall not exceed (a) 5,000,000, plus (b) the additional shares of Common
Stock described in Sections 3.2 and 3.3. The limitations of this Section 3.1 and
Section 3.2 shall be subject to adjustment pursuant to Article 9.
3.2 Additional Shares. If Restricted Shares or shares of Common
Stock issued upon the exercise of Options are forfeited, then such shares of
Common Stock shall again become available for awards under the Plan. If Options
are forfeited or terminate for any other reason before being exercised, then the
corresponding shares of Common Stock shall again become available for awards
under the Plan.
3.3 Dividend Equivalents. Any dividend equivalents paid or
credited under the Plan shall not be applied against the number of Restricted
Shares or Options available for awards.
ARTICLE IV ELIGIBILITY.
4.1 Other Grants. Employees and Consultants shall be eligible for
the grant of Restricted Shares and NSOs. Outside Directors and Executive
Officers shall not be eligible for awards under the Plan.
ARTICLE V OPTIONS.
5.1 Stock Option Agreement. Each grant of an Option under the Plan
shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms of the Plan and
may be subject to any other terms that are not inconsistent with the Plan. The
provisions of the various Stock Option Agreements entered into under the Plan
need not be identical. Options may be granted in consideration of a reduction in
the Optionee's other compensation. A Stock Option Agreement may provide that a
new Option will be granted automatically to the Optionee when he or she
exercises a prior Option and pays the Exercise Price in the form described in
Section 6.2.
5.2 Number of Shares. Each Stock Option Agreement shall specify the
number of shares of Common Stock subject to the Option and shall provide for the
adjustment of such number in accordance with Article 9.
5.3 Exercise Price. Each Stock Option Agreement shall specify the
Exercise Price; provided that the Exercise Price under an NSO shall in no event
be less than 85% of the Fair Market Value of a Common Share on the date of
grant. A Stock Option Agreement may specify an Exercise Price that varies in
accordance with a predetermined formula while the NSO is outstanding.
5.4 Exercisability and Term. Each Stock Option Agreement shall
specify the date or event when all or any installment of the Option is to become
exercisable. The Stock Option Agreement shall also specify the term of the
Option. A Stock Option Agreement may provide for accelerated exercisability in
the event of the Optionee's death, disability or retirement or other events and
may provide for expiration prior to the end of its term in the event of the
termination of the Optionee's service.
5.5 Modification or Assumption of Options. Within the limitations of
the Plan, the Committee may modify, extend or assume outstanding options or may
accept the cancellation of outstanding options (whether granted by the Company
or by another issuer) in return for the grant of new options for the same or a
different number of shares and at the same or a different exercise price. The
foregoing notwithstanding, no modification of an Option shall, without the
consent of the Optionee, alter or impair his or her rights or obligations under
such Option.
5.6 Buyout Provisions. The Committee may at any time (a) offer to
buy out for a payment in cash or cash equivalents an Option previously granted
or (b) authorize an
2
Optionee to elect to cash out an Option previously granted, in either case at
such time and based upon such terms and conditions as the Committee shall
establish.
ARTICLE VI PAYMENT FOR OPTION SHARES.
6.1 General Rule. The entire Exercise Price of shares of Common
Stock issued upon exercise of Options shall be payable in cash or cash
equivalents at the time when such shares of Common Stock are purchased and the
Committee may at any time accept payment in any form(s) described in this
Article 6.
6.2 Surrender of Stock. To the extent that this Section 6.2 is
applicable, all or any part of the Exercise Price may be paid by surrendering,
or attesting to the ownership of, shares of Common Stock that are already owned
by the Optionee. Such shares of Common Stock shall be valued at their Fair
Market Value on the date when the new shares of Common Stock are purchased under
the Plan. The Optionee shall not surrender, or attest to the ownership of,
shares of Common Stock in payment of the Exercise Price if such action would
cause the Company to recognize compensation expense (or additional compensation
expense) with respect to the Option for financial reporting purposes.
6.3 Exercise/Sale. To the extent that this Section 6.3 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to a securities broker approved by the Company to sell all or part of
the shares of Common Stock being purchased under the Plan and to deliver all or
part of the sales proceeds to the Company.
6.4 Exercise/Pledge. To the extent that this Section 6.4 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to pledge all or part of the shares of Common Stock being purchased
under the Plan to a securities broker or lender approved by the Company, as
security for a loan, and to deliver all or part of the loan proceeds to the
Company.
6.5 Promissory Note. To the extent that this Section 6.5 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) a full-recourse
promissory note. However, the par value of the shares of Common Stock being
purchased under the Plan, if newly issued, shall be paid in cash or cash
equivalents.
6.6 Other Forms of Payment. To the extent that this Section 6.6 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid in any other form that is consistent with applicable laws, regulations
and rules.
3
ARTICLE VII RESTRICTED SHARES.
7.1 Restricted Stock Agreement. Each grant of Restricted Shares
under the Plan shall be evidenced by a Restricted Stock Agreement between the
recipient and the Company. Such Restricted Shares shall be subject to all
applicable terms of the Plan and may be subject to any other terms that are not
inconsistent with the Plan. The provisions of the various Restricted Stock
Agreements entered into under the Plan need not be identical.
7.2 Payment for awards. Subject to the following sentence,
Restricted Shares may be sold or awarded under the Plan for such consideration
as the Committee may determine, including (without limitation) cash, cash
equivalents, full-recourse promissory notes, past services and future services.
To the extent that an award consists of newly issued Restricted Shares, the
consideration shall consist exclusively of cash, cash equivalents or past
services rendered to the Company (or a Parent or Subsidiary) or, for the amount
in excess of the par value of such newly issued Restricted Shares, full-recourse
promissory notes, as the Committee may determine.
7.3 Vesting Conditions. Each award of Restricted Shares may or may
not be subject to vesting. Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Restricted Stock Agreement. A
Restricted Stock Agreement may provide for accelerated vesting in the event of
the Participant's death, disability or retirement or other events.
7.4 Voting and Dividend Rights. The holders of Restricted Shares
awarded under the Plan shall have the same voting, dividend and other rights as
the Company's other stockholders. A Restricted Stock Agreement, however, may
require that the holders of Restricted Shares invest any cash dividends received
in additional Restricted Shares. Such additional Restricted Shares shall be
subject to the same conditions and restrictions as the award with respect to
which the dividends were paid.
ARTICLE VIII CHANGE IN CONTROL.
8.1 Effect of Change in Control. In the event of any Change in
Control, each outstanding award shall automatically accelerate so that each such
award shall, immediately prior to the effective date of the Change in Control,
become fully exercisable for all of the shares of Common Stock at the time
subject to such award and may be exercised for any or all of those shares as
fully-vested shares of Common Stock. However, an outstanding award shall not so
accelerate if and to the extent such award is, in connection with the Change in
Control, either to be assumed by the successor corporation (or parent thereof)
or to be replaced with a comparable award for shares of the capital stock of the
successor corporation (or parent thereof). The determination of award
comparability shall be made by the Plan Administrator, and its determination
shall be final, binding and conclusive.
8.2 Involuntary Termination. In addition, in the event that the
award is assumed by the successor corporation (or parent thereof) and the
Participant experiences an Involuntary Termination within eighteen months
following a Change in Control, each outstanding award shall automatically
accelerate so that each such award shall, immediately
4
prior to the effective date of the Involuntary Termination, become fully
exercisable for all of the shares of Common Stock at the time subject to such
award and may be exercised for any or all of those shares as fully-vested shares
of Common Stock.
ARTICLE IX. PROTECTION AGAINST DILUTION.
9.1 Adjustments. In the event of a subdivision of the outstanding
shares of Common Stock, a declaration of a dividend payable in shares of Common
Stock, a declaration of a dividend payable in a form other than shares of Common
Stock in an amount that has a material affect on the price of shares of Common
Stock, a combination or consolidation of the outstanding shares of Common Stock
(by reclassification or otherwise) into a lesser number of shares of Common
Stock, a recapitalization, a spin-off or a similar occurrence, the Committee
shall make such adjustments as it deems appropriate in order to prevent the
dilution or enlargement of benefits thereunder, in one or more of:
(a) The number of Options or Restricted Shares available for
future awards under Article 3;
(b) The number of shares of Common Stock covered by each
outstanding Option; or
(c) The Exercise Price under each outstanding Option.
Except as provided in this Article 9, a Participant shall have no rights by
reason of any issue by the Company of stock of any class or securities
convertible into stock of any class, any subdivision or consolidation of shares
of stock of any class, the payment of any stock dividend or any other increase
or decrease in the number of shares of stock of any class.
9.2 Dissolution or Liquidation. To the extent not previously
exercised or settled, Options shall terminate immediately prior to the
dissolution or liquidation of the Company.
9.3 Reorganizations. In the event that the Company is a party to a
merger or other reorganization, outstanding awards shall be subject to the
agreement of merger or reorganization. Such agreement shall provide for (a) the
continuation of the outstanding awards by the Company, if the Company is a
surviving corporation, (b) the assumption of the outstanding awards by the
surviving corporation or its parent or subsidiary, (c) the substitution by the
surviving corporation or its parent or subsidiary of its own awards for the
outstanding awards, (d) full exercisability or vesting and accelerated
expiration of the outstanding awards or (e) settlement of the full value of the
outstanding awards in cash or cash equivalents followed by cancellation of such
awards.
ARTICLE X. DEFERRAL OF AWARDS.
The Committee (in its sole discretion) may permit or require a
Participant to have shares of Common Stock that otherwise would be delivered to
such Participant as a result of the exercise of an Option converted into amounts
credited to a deferred compensation account established for such Participant by
the Committee as an entry on the Company's books. Such
5
amounts shall be determined by reference to the Fair Market Value of such shares
of Common Stock as of the date when they otherwise would have been delivered to
such Participant.
A deferred compensation account established under this Article 10
may be credited with interest or other forms of investment return, as determined
by the Committee. A Participant for whom such an account is established shall
have no rights other than those of a general creditor of the Company. Such an
account shall represent an unfunded and unsecured obligation of the Company and
shall be subject to the terms and conditions of the applicable agreement between
such Participant and the Company. If the deferral or conversion of awards is
permitted or required, the Committee (in its sole discretion) may establish
rules, procedures and forms pertaining to such awards, including (without
limitation) the settlement of deferred compensation accounts established under
this Article 10.
ARTICLE XI. LIMITATION ON RIGHTS.
11.1 Retention Rights. Neither the Plan nor any award granted under
the Plan shall be deemed to give any individual a right to remain an Employee or
Consultant. The Company and its Parents, Subsidiaries and Affiliates reserve the
right to terminate the service of any Employee, or Consultant at any time, with
or without cause, subject to applicable laws, the Company's certificate of
incorporation and by-laws and a written employment agreement (if any).
11.2 Stockholders' Rights. A Participant shall have no dividend
rights, voting rights or other rights as a stockholder with respect to any
shares of Common Stock covered by his or her award prior to the time when a
stock certificate for such shares of Common Stock is issued or, if applicable,
the time when he or she becomes entitled to receive such shares of Common Stock
by filing any required notice of exercise and paying any required Exercise
Price. No adjustment shall be made for cash dividends or other rights for which
the record date is prior to such time, except as expressly provided in the Plan.
11.3 Regulatory Requirements. Any other provision of the Plan
notwithstanding, the obligation of the Company to issue shares of Common Stock
under the Plan shall be subject to all applicable laws, rules and regulations
and such approval by any regulatory body as may be required. The Company
reserves the right to restrict, in whole or in part, the delivery of shares of
Common Stock pursuant to any award prior to the satisfaction of all legal
requirements relating to the issuance of such shares of Common Stock, to their
registration, qualification or listing or to an exemption from registration,
qualification or listing.
ARTICLE XII. WITHHOLDING TAXES.
12.1 General. To the extent required by applicable federal, state,
local or foreign law, a Participant or his or her successor shall make
arrangements satisfactory to the Company for the satisfaction of any withholding
tax obligations that arise in connection with the Plan. The Company shall not be
required to issue any shares of Common Stock or make any cash payment under the
Plan until such obligations are satisfied.
12.2 Share Withholding. The Committee may permit a Participant to
satisfy all or part of his or her withholding or income tax obligations by
having the Company withhold
6
all or a portion of any shares of Common Stock that otherwise would be issued to
him or her or by surrendering all or a portion of any shares of Common Stock
that he or she previously acquired. Such shares of Common Stock shall be valued
at their Fair Market Value on the date when taxes otherwise would be withheld in
cash.
ARTICLE XIII. FUTURE OF THE PLAN.
13.1 Term of the Plan. The Plan, as set forth herein, shall become
effective on September 26, 2001. The Plan shall remain in effect until it is
terminated under Section 13.2.
13.2 Amendment or Termination. The Board may, at any time and for
any reason, amend or terminate the Plan. An amendment of the Plan shall be
subject to the approval of the Company's stockholders only to the extent
required by applicable laws, regulations or rules. No awards shall be granted
under the Plan after the termination thereof. The termination of the Plan, or
any amendment thereof, shall not affect any award previously granted under the
Plan.
ARTICLE XIV. DEFINITIONS.
14.1 "Affiliate" means any entity other than a Subsidiary, if the
Company and/or one or more Subsidiaries own not less than 50% of such entity.
14.2 "Board" means the Company's Board of Directors, as constituted
from time to time.
14.3 "Change in Control" shall mean:
(a) The consummation of a merger or consolidation of the
Company with or into another entity or any other corporate reorganization, if
persons who were not stockholders of the Company immediately prior to such
merger, consolidation or other reorganization own immediately after such merger,
consolidation or other reorganization 50% or more of the voting power of the
outstanding securities of each of (i) the continuing or surviving entity and
(ii) any direct or indirect parent corporation of such continuing or surviving
entity;
(b) The sale, transfer or other disposition of all or
substantially all of the Company's assets;
(c) A change in the composition of the Board, as a result of
which fewer than 50% of the incumbent directors are directors who either (i) had
been directors of the Company on the date 24 months prior to the date of the
event that may constitute a Change in Control (the "original directors") or (ii)
were elected, or nominated for election, to the Board with the affirmative votes
of at least a majority of the aggregate of the original directors who were still
in office at the time of the election or nomination and the directors whose
election or nomination was previously so approved; or
(d) Any transaction as a result of which any person is the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing at least 50% of the
total voting power represented by the Company's
7
then outstanding voting securities. For purposes of this Paragraph (d), the term
"person" shall have the same meaning as when used in sections 13(d) and 14(d) of
the Exchange Act but shall exclude(i) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or of a Parent or
Subsidiary and (ii) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their
ownership of the common stock of the Company.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
14.4 "Code" means the Internal Revenue Code of 1986, as amended.
14.5 "Committee" means a committee of the Board, as described in
Article 2.
14.6 "Common Stock" means the common stock of the Company.
14.7 "Company" means Equinix, Inc., a Delaware corporation.
14.8 "Consultant" means a consultant or adviser who provides bona
fide services to the Company, a Parent, a Subsidiary or an Affiliate as an
independent contractor. Service as a Consultant shall be considered employment
for all purposes of the Plan, except as provided in Section 4.1.
14.9 "Employee" means a common-law employee of the Company, a
Parent, a Subsidiary or an Affiliate.
14.10 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
14.11 "Exercise Price," in the case of an Option, means the amount
for which one Common Share may be purchased upon exercise of such Option, as
specified in the applicable Stock Option Agreement.
14.12 "Executive Officer" means an officer of the Company who is
subject to the short-swing profit rules under Section 16 of the Exchange Act.
14.13 "Fair Market Value" means the market price of one share of
Common Stock, determined by the Committee in good faith on such basis as it
deems appropriate. Whenever possible, the determination of Fair Market Value by
the Committee shall be based on the prices reported in The Wall Street Journal.
Such determination shall be conclusive and binding on all persons.
14.14 "Involuntary Termination" means the termination of the Service
of any individual which occurs by reason of:
(a) such individual's involuntary dismissal or discharge by
the Company for reasons other than Misconduct, or
8
(b) such individual's voluntary resignation following (A) a
change in his or her position with the Company which materially reduces his or
her level of responsibility, (B) a reduction in his or her level of compensation
(including base salary, fringe benefits and participation in bonus or incentive
programs) or (C) a relocation of such individual's place of employment by more
than fifty (50) miles, provided and only if such change, reduction or relocation
is effected by the Company without the individual's consent.
14.15 "Misconduct" means the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, any unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Company (or any Parent or Subsidiary), or any other intentional misconduct by
such person adversely affecting the business or affairs of the Company (or any
Parent or Subsidiary) in a material manner. The foregoing definition shall not
be deemed to be inclusive of all the acts or omissions which the Company (or any
Parent or Subsidiary) may consider as grounds for the dismissal or discharge of
any Optionee or Participant or other person in the Service of the Company (or
any Parent or Subsidiary).
14.16 "NSO" means a stock option not described in sections 422 or
423 of the Code.
14.17 "Option" means an NSO granted under the Plan and entitling the
holder to purchase shares of Common Stock.
14.18 "Optionee" means an individual or estate who holds an Option.
14.19 "Outside Director" shall mean a member of the Board who is not
an Employee.
14.20 "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.
14.21 "Plan" means this Equinix, Inc. 2001 Supplemental Stock Plan,
as amended from time to time.
14.22 "Restricted Share" means a Common Share awarded under the
Plan.
14.23 "Restricted Stock Agreement" means the agreement between the
Company and the recipient of a Restricted Share which contains the terms,
conditions and restrictions pertaining to such Restricted Share.
14.24 "Stock Option Agreement" means the agreement between the
Company and an Optionee that contains the terms, conditions and restrictions
pertaining to his or her Option.
9
14.25 "Subsidiary" means any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain. A corporation that attains
the status of a Subsidiary on a date after the adoption of the Plan shall be
considered a Subsidiary commencing as of such date.
10