As filed with the Securities and Exchange Commission on April 28, 1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
Under the Securities Act of 1933
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ICG COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware 84-1342022
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9605 East Maroon Circle
Englewood, Colorado 80112
(303) 572-5960
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Incentive Stock Option Plan #2
Incentive Stock Option Plan #3
1994 Employee Stock Option Plan
1996 Stock Option Plan
ICG Communications, Inc. Employee Savings Plan
ICG Communications, Inc. 401(k) Wraparound Deferred Compensation Plan
(Full title of the Plans)
------------------
James D. Grenfell
Chief Financial Officer
9605 East Maroon Circle
Englewood, Colorado 80112
(303) 572-5960
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
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CALCULATION OF REGISTRATION FEE
- -------------- -------------- -------------- -------------- --------------------
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate
to be to be Price Per Offering Amount of
Registered Registered Share Price Registration Fee(1)
- -------------- ----------------- ------------- ------------ --------------------
Common Stock
par value $.01 6,253,600 shares $9.25 $57,845,800 $17,529.03
share (2)
- -------------------------------- ------------- ----------- ---------------------
(1) This Registration Statement carries forward 5,347,725 of the 39,970,232
shares of Common Stock previously registered on Form S-4 (Registration No.
333-4226), for which an aggregate of $248,355, representing the
registration fee in connection with the registration of 39,970,232 shares
of Common Stock, has been paid. Determined pursuant to Rule 457(h)(1) of
the Securities Act of 1933, based upon the average high and low prices
reported on April 22, 1997.
(2) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, as
amended, this Registration Statement also covers an indeterminate amount
of interests to be offered or sold pursuant to the employee benefit plan
described herein.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Information required by Part I to be contained in the Section 10(a)
Prospectus is omitted from this Registration Statement in accordance with Rule
428 under the Securities Act of 1933, as amended, and the Note to Part I of Form
S-8.
The Registrant was incorporated in 1996 for the purpose of effecting a
plan of arrangement (the "Arrangement") under which the Registrant became the
parent of ICG Holdings (Canada), Inc., a Canadian federal corporation formerly
known as IntelCom Group, Inc. ("Holdings-Canada"), and ICG Holdings, Inc., a
Colorado corporation formerly known as IntelCom Group (U.S.A.), Inc.
("Holdings-USA"). The Arrangement was effective on August 5, 1996. In connection
with the Arrangement, IntelCom Group, Inc. changed its name to ICG Holdings
(Canada), Inc. and IntelCom Group (U.S.A.) changed its name to ICG Holdings,
Inc. Unless the context indicates otherwise, as used in this Prospectus the
terms "Registrant" or "Company" mean, on and after August 5, 1996, ICG
Communications, Inc. and, before August 5, 1996, Holdings-Canada, and its
respective consolidated subsidiaries.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by ICG Communications, Inc. (the
"Registrant" or the "Company") with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), are incorporated herein
by reference:
(a) Transition Report on Form 10-K for the fiscal year ended December
31, 1996, File No. 1-11965.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the
registrant document referred to in (a) above.
(c) The description of the common stock, $.01 par value, of the
Company contained in a registration statement filed under Section
12 of the Exchange Act, including any amendments or reports filed
for the purpose of updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act, as amended, subsequent to the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or which deregisters
all securities remaining unsold, shall be deemed to be incorporated by reference
in this Registration Statement and to be a part thereof from the date of the
filing of such documents (such documents and the documents enumerated above,
being hereinafter referred to as "Incorporated Documents"); provided, however,
that the documents enumerated above or subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act in each year
during which the offering made by this Registration Statement is in effect prior
to the filing with the Commission of the Company's Annual Report on Form 10-K
covering such year shall not be Incorporated Documents or be incorporated by
reference in this Registration Statement or be a part hereof from and after the
filing of such Annual Report on Form 10-K.
Item 4. Description of Securities.
Not applicable.
Item 5. Interest of Named Experts and Counsel.
Not applicable.
<PAGE>
Item 6. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law provides,
generally, that a corporation shall have the power to indemnify any person who
was or is a party or is threatened to be made a party to any action, suit or
proceeding (except actions by or in the right of the corporation) by reason of
the fact that such person is or was a director or officer of the corporation
against all expenses, judgments, fines and amounts paid in settlement actually
and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. A corporation may similarly indemnify such person for
expenses actually and reasonably incurred by him in connection with the defense
or settlement of any action or suit by or in the right of the corporation,
provided such person acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation, and, in the
case of claims, issues and matters as to which such person shall have been
adjudged liable to the corporation, provided that a court shall have determined,
upon application, that, despite the adjudication of liability but in view of all
of the circumstances of the case, such person is fairly and reasonably entitled
to indemnity for such expenses which such court shall deem proper.
Section 102(b)(7) of the Delaware General Corporation Law provides,
generally, that the certificate of incorporation may contain a provision
eliminating or limiting the personal liability of a director to the corporation
or its stockholders for monetary damages for breach of fiduciary duty as a
director, provided that such provision may not eliminate or limit the liability
of a director (i) for any breach of the director=s duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of Title 8, or (iv) for any transaction from which the director
derived an improper personal benefit. No such provision may eliminate or limit
the liability of a director for any act or omission occurring prior to the date
when such provision becomes effective.
Articles Eighth and Tenth of the Company's Certificate of Incorporation
provide as follows:
EIGHTH: A director of the Corporation shall not be
personally liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director,
except for liability (i) for breach of the director=s duty of
loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174
of the Delaware General Corporation Law, or (iv) for any
transaction from which the director derived any improper personal
benefit. If the Delaware General Corporation Law is hereafter
amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability
of a director of the Corporation shall be eliminated or limited
to the fullest extent permitted by the Delaware General
Corporation Law, as so amended.
<PAGE>
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any
right or protection of a director of the Corporation existing at
the time of such repeal or modification.
TENTH: The Corporation shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, or by or in the right
of the Corporation to procure judgment in its favor, by reason of
the fact that he is or was a director, officer, employee or agent
of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys= fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests
of the Corporation, in accordance with and to the full extent
permitted by applicable law. Expenses (including attorneys= fees)
incurred in defending any civil, criminal administrative or
investigative action, suit or proceeding may be paid by the
Corporation in advance of the final disposition of such action,
suit or proceeding as authorized by the Board of Directors in the
specific case upon receipt of an undertaking by or on behalf of
the director, officer, employee or agent to repay such amount
unless it shall ultimately be determined that he is entitled to
be indemnified by the Corporation as authorized in this section.
The indemnification provided by this section shall not be deemed
exclusive of any other rights to which those seeking
indemnification may be entitled under these Articles or any
agreement or vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer,
employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
Article VIII, Section 8.1 of the Company's Bylaws provide as follows:
Indemnification. The Corporation shall indemnify to the
fullest extent permitted by law any person made or threatened to
be made a party to any action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact
that such person, or a person of whom he or she is the legal
representative, is or was a director, officer, employee or agent
of the Corporation or any predecessor of the Corporation, or
serves or served any other enterprise as a director, officer,
employee or agent at the request of the Corporation or any
predecessor of the Corporation.
The Corporation shall pay any expenses reasonably incurred
by a director or officer in defending a civil or criminal action,
suit or proceeding in advance of the
<PAGE>
final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or officer to
repay such amount if it shall ultimately be determined that he or
she is not entitled to be indemnified by the Corporation under
this Article or otherwise. The Corporation may, by action of its
Board of Directors, provide for the payment of such expenses
incurred by employees and agents of the Corporation as it deems
appropriate.
The rights conferred on any person under this Article shall
not be deemed exclusive of any other rights that such person may
have or hereafter acquire under any statute, provision of the
Corporation=s Certificate of Incorporation, By-Law, agreement,
vote of stockholders or disinterested directors or otherwise. All
rights to indemnification and to the advancement of expenses
under this Article shall be deemed to be provided by a contract
between the Corporation and the director, officer, employee or
agent who serves in such capacity at any time while these By-Laws
and any other relevant provisions of the Delaware General
Corporation Law and any other applicable law, if any, are in
effect. Any repeal or modification thereof shall not affect any
rights or obligations then existing.
For purposes of this Article, references to "the
Corporation" shall be deemed to include any subsidiary of the
Corporation now or hereafter organized under the laws of the
State of Delaware.
The Company has purchased liability insurance policies covering its
directors and officers.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
See Exhibit Index and Exhibits at the end of this Registration
Statement.
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
<PAGE>
represent a fundamental change in the information set
forth in the registration statement;
(iii)To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant=s annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plans annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Englewood, State of Colorado, on March 31, 1997.
ICG COMMUNICATIONS, INC.
By: /s/ J. Shelby Bryan
J. Shelby Bryan,
President, Chief Executive
Officer and Director
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints J. Shelby Bryan and James D. Grenfell,
and each of them, his true and lawful attorneys-in-fact and agents, each with
full power of substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or either
of them, or their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
/s/ William J. Laggett Chairman of the Board of Directors March 31, 1997
- -----------------------
William J. Laggett
/s/ J. Shelby Bryan President, Chief Executive March 31, 1997
- ------------------------ Officer and Director
J. Shelby Bryan (Principal Executive Officer)
/s/ James D. Grenfell Executive Vice President and March 31, 1997
- ------------------------ Chief Financial Officer(Principal
James D. Grenfell Financial Officer)
/s/ Richard Bambach Vice President and Corporate March 31, 1997
- ------------------------ Controller (Principal
Richard Bambach Accounting Officer)
/s/ Harry R. Herbst Director March 31, 1997
- -------------------------
Harry R. Herbst
/s/ Jay E. Ricks Director March 31, 1997
- -------------------------
Jay E. Ricks
/s/ Leontis Teryazos Director March 31, 1997
- -------------------------
Leontis Teryazos
/s/ Stan McLelland Director March 31, 1997
- -------------------------
Stan McLelland
The Employee Savings Plan. Pursuant to the requirements of the Securities
Act of 1933, the persons who administer the Employee Savings Plan have duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Englewood, State of
Colorado, on April 25, 1997.
By: /s/James D. Grenfell
----------------------------------
James D. Grenfell, Plan Administrator
<PAGE>
EXHIBIT INDEX
Exhibits
4.1 Certificate of Incorporation of ICG Communications, Inc. [Incorporated
by reference to Exhibit 3.1 to Registration Statement on Form S-4 of
ICG Communications, Inc.; File No. 333-4226.]
4.2 By-laws of ICG Communications, Inc. [Incorporated by reference to
Exhibit 3.1 to Registration Statement on Form S-4 of ICG
Communications, Inc., File No. 333-4226.]
4.3 Incentive Stock Option Plan #2 [Incorporated by reference to Exhibit
4.1 to the Registration Statement on Form S-8 of IntelCom Group Inc.,
File No. 33-86346, filed November 14, 1994.]
4.4 Incentive Stock Option Plan #3 [Incorporated by reference to Exhibit
4.3 to the Registration Statement on Form S-8 of IntelCom Group Inc.,
File No. 33-86346, filed November 14, 1994.]
4.5 1994 Employee Stock Option Plan [Incorporated by reference to Exhibit
4.5 to the Registration Statement on Form S-8 of IntelCom Group Inc.,
File No. 33-86346, filed November 14, 1994.]
4.6 1996 Stock Option Plan.
4.6a Form of standard Non-qualified Stock Option Agreement.
4.6b Form of standard Non-qualified Stock Option Agreement (for Directors).
4.7 ICG Communications, Inc. 401(k) Wraparound Deferred Compensation Plan
[Incorporated by reference to Exhibit 10.42 to Annual Report on form
10-K/A for the fiscal year ended September 30, 1996.]
5.1 Opinion of Counsel.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Counsel (included in Exhibit 5.1).
- --------------------------------------------------------------------------------
EXHIBIT 4.6
- --------------------------------------------------------------------------------
ICG COMMUNICATIONS, INC.
1996 STOCK OPTION PLAN
---------------
Effective as of August 2, 1996
<PAGE>
ICG Communications, Inc.
1996 Stock Option Plan
INTRODUCTION
ICG Communications, Inc., a Delaware corporation (hereinafter
referred to as the "Corporation"), hereby establishes an incentive compensation
plan to be known as the "ICG Communications, Inc. 1996 Stock Option Plan"
(hereinafter referred to as the "Plan"), as set forth in this document. The Plan
permits the grant of Non-Qualified Stock Options and Incentive Stock Options.
Prior to August 2, 1996, the Plan was known as the IntelCom
Group Inc. Restated and Amended 1995 Stock Option Plan (the "IntelCom Plan") and
was sponsored by IntelCom Group Inc., a Canadian federal corporation
("IntelCom"). Effective as of August 2, 1996 IntelCom became a subsidiary of the
Corporation and, pursuant to the transactions related thereto, the Corporation
assumed sponsorship of, and immediately thereafter amended and restated, the
IntelCom Plan in the form as herein set forth. Accordingly, the Plan constitutes
a continuation of the IntelCom Plan, as assumed by the Corporation.
The IntelCom Plan became effective on October 1, 1995, and was
approved by a majority vote of IntelCom's stockholders on October 12, 1995. This
Plan becomes effective as of the date the IntelCom Plan is assumed by the
Corporation. All stock options awarded under the IntelCom Plan, to the extent
not exercised on or before August 2, 1996, shall be assumed by the Corporation
on such date, shall be satisfied by the delivery of the Corporation's Common
Stock, $.01 par value, in lieu of IntelCom Common Shares, no par value, and
shall be administered in accordance with the terms of this Plan.
The purpose of the Plan is to promote the success and enhance
the value of the Corporation by linking the personal interests of Participants
to those of the Corporation's stockholders by providing Participants with an
incentive for outstanding performance. The Plan is further intended to assist
the Corporation in its ability to motivate, and retain the services of,
Participants upon whose judgment, interest and special effort the successful
conduct of its operations is largely dependent.
<PAGE>
DEFINITIONS
For purposes of this Plan, the following terms shall be
defined as follows unless the context clearly indicates otherwise:
A. "Code" shall mean the Internal Revenue Code of 1986, as amended, and the
rules and regulations thereunder.
B. "Committee" shall mean the Stock Option Committee of the Board of
Directors of the Corporation.
C. "Common Stock" shall mean the common stock, $.01 par value, of the
Corporation.
D. "Corporation" shall mean ICG Communications, Inc., a Delaware
corporation. For all purposes of this Plan, prior to August 2, 1996 the term
Corporation shall mean IntelCom Group Inc., a Canadian federal corporation.
E. "Director Participant" shall mean a director of the Corporation or of
any Parent or Subsidiary on the date of a grant of Options under Section V(B)
hereof who is not a common law employee of the Corporation, any Parent or any
Subsidiary.
F. "Disability" shall have the same meaning as the term "permanent and
total disability" under Section 22(e)(3) of the Code.
G. "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder.
H. "Executive" shall mean an employee of the Corporation or of any Parent
or Subsidiary whose compensation is subject to the deduction limitations set
forth under Code Section 162(m).
I. "Fair Market Value" of the Corporation's Common Stock on a Trading Day
shall mean the last reported sale price for Common Stock or, in case no such
reported sale takes place on such Trading Day, the average of the closing bid
and asked prices for the Common Stock for such Trading Day, in either case on
the principal securities exchange on which the Common Stock is listed or
admitted to trading, or if the Common Stock is not listed or admitted to trading
on any securities exchange, but is traded in the over-the-counter market, the
closing sale price of the Common Stock or, if no sale is publicly reported, the
average of the closing bid and asked quotations for the Common Stock, as
reported by the National Association of Securities Dealers Automated Quotation
System ("NASDAQ") or any comparable system or, if the Common Stock is not listed
on NASDAQ or a comparable system, the closing sale price of the Common Stock or,
if no sale is publicly reported, the average of the closing bid and asked
prices, as furnished by two members of the National Association of Securities
Dealers, Inc. who make a market in the Common Stock selected from time to time
by the Corporation for that purpose. In addition, for purposes of this
definition, a "Trading Day" shall mean, if the Common Stock is listed on any
securities exchange, a business day during which such exchange was open for
trading and at least one trade of Common Stock was effected on such exchange on
such business day, or, if the Common Stock is not listed on any national
securities exchange but
<PAGE>
is traded in the over-the-counter market, a business day during which the
over-the-counter market was open for trading and at least one "eligible dealer"
quoted both a bid and asked price for the Common Stock. An "eligible dealer" for
any day shall include any broker-dealer who quoted both a bid and asked price
for such day, but shall not include any broker-dealer who quoted only a bid or
only an asked price for such day. In the event the Corporation's Common Stock is
not publicly traded, the Fair Market Value of such Common Stock shall be
determined by the Committee in good faith.
J. "Good Cause" shall mean (i) a Participant's willful or gross misconduct
or willful or gross negligence in the performance of his duties for the
Corporation or for any Parent or Subsidiary after prior written notice of such
misconduct or negligence and the continuance thereof for a period of 30 days
after receipt by such Participant of such notice, (ii) a Participant's
intentional or habitual neglect of his duties for the Corporation or for any
Parent or Subsidiary after prior written notice of such neglect, or (iii) a
Participant's theft or misappropriation of funds of the Corporation or of any
Parent or Subsidiary or commission of a felony.
K. "Incentive Stock Option" shall mean a stock option satisfying the
requirements for tax-favored treatment under Section 422 of the Code.
L. "Non-Qualified Option" shall mean a stock option which does not satisfy
the requirements for, or which is not intended to qualify for, tax-favored
treatment under Section 422 of the Code.
M. "Option" or "Plan Award" shall mean an Incentive Stock Option or a
Non-Qualified Stock Option granted pursuant to the provisions of Section V
hereof.
N. "Optionee" shall mean a Participant who is granted an Option under the
terms of this Plan.
O. "Outside Directors" shall mean members of the Board of Directors of the
Corporation who are classified as "outside directors" under Section 162(m) of
the Code.
P. "Parent" shall mean a parent corporation of the Corporation within the
meaning of Section 424(e) of the Code.
Q. "Participant" shall mean any employee of the Corporation or any Parent
or Subsidiary, or a Director Participant, participating under the Plan.
R. "Plan Quarter" shall mean the three calendar month periods beginning
October 1st, January 1st, April 1st and July 1st.
S. "Retirement" shall mean the termination of employment by a Participant
in the Plan from the Corporation or from any Parent or Subsidiary, who at the
time of such termination is at least fifty-five (55) years of age and who has
completed at least ten (10) years of service (at least 1,000 hours in any fiscal
year) with the Corporation or any Parent or Subsidiary, or any combination
thereof.
T. "Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations thereunder.
<PAGE>
U. "Subsidiary" shall mean a subsidiary corporation of the Corporation
within the meaning of Section 424(f) of the Code.
<PAGE>
SECTION I.
ADMINISTRATION
The Plan shall be administered by the Committee, which shall
be composed solely of at least two Non-Employee Directors, as defined in Rule
16b-3(b)(3) promulgated under the Exchange Act, and who also qualify as Outside
Directors. Subject to the provisions of the Plan, the Committee may establish
from time to time such regulations, provisions, proceedings and conditions of
awards which, in its opinion, may be advisable in the administration of the
Plan. A majority of the Committee shall constitute a quorum, and, subject to the
provisions of Section IV of the Plan, the acts of a majority of the members
present at any meeting at which a quorum is present, or acts approved in writing
by a majority of the Committee, shall be the acts of the Committee.
SECTION II.
SHARES AVAILABLE
Subject to the adjustments provided in Section VII of the
Plan, the aggregate number of shares of the Common Stock which may be granted
for all purposes under the Plan shall be two million five hundred thousand
(2,500,000) shares, reduced by the number of Common Shares of Intelcom
represented by options granted to individuals under the IntelCom Plan prior to
August 2, 1996. Shares of Common Stock underlying awards of Options shall be
counted against the limitation set forth in the immediately preceding sentence
and may be reused to the extent that an Option expires, is terminated
unexercised, or is forfeited. Incentive and Non-Qualified Stock Options awarded
under the Plan may be fulfilled in accordance with the terms of the Plan with
either authorized and unissued shares of the Common Stock, issued shares of such
Common Stock held in the Corporation's treasury or shares of Common Stock
acquired on the open market.
SECTION III.
ELIGIBILITY
Officers and key employees (including officers or key
employees who are also directors) of the Corporation, or of any Parent or
Subsidiary, who are regularly employed on a salaried basis as common law
employees shall be eligible to participate in the Plan. Directors of the
Corporation, or of any Parent or Subsidiary, who are not common law employees of
the Corporation or of any Parent or Subsidiary shall also be eligible to
participate in the Plan, but only to the extent provided under Section V(B)
hereof and, where appropriate under this Plan, shall be referred to as
"employees" and their service as directors as "employment".
<PAGE>
SECTION IV.
AUTHORITY OF COMMITTEE
The Plan shall be administered by, or under the direction of,
the Committee, which shall administer the Plan so as to comply at all times with
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder, to the extent such compliance is required, and shall otherwise have
plenary authority to interpret the Plan and to make all determinations specified
in or permitted by the Plan or deemed necessary or desirable for its
administration or for the conduct of the Committee's business. Subject to the
provisions of Section X hereof, all interpretations and determinations of the
Committee may be made on an individual or group basis and shall be final,
conclusive and binding on all interested parties. Subject to the express
provisions of the Plan, the Committee shall have authority, in its discretion,
to determine the persons to whom Plan Awards shall be granted, the times when
such Plan Awards shall be granted, the number of Plan Awards, the exercise price
of each Plan Award, the period(s) during which such Plan Award shall be
exercisable (whether in whole or in part), the restrictions to be applicable to
Plan Awards and the other terms and provisions thereof (which need not be
identical). In addition, the authority of the Committee shall include, without
limitation, the following:
A. Financing. The arrangement of temporary financing for an Optionee by
registered broker-dealers, under the rules and regulations of the Federal
Reserve Board, for the purpose of assisting the Optionee in the exercise of an
Option, such authority to include the payment by the Corporation of the
commissions of the broker-dealer;
B. Procedures for Exercise of Option. The establishment of procedures for
an Optionee (i) to exercise an Option by payment of cash or any other property
acceptable to the Committee, (ii) to have withheld from the total number of
shares of Common Stock to be acquired upon the exercise of an Option that number
of shares having a Fair Market Value, which, together with such cash as shall be
paid in respect of fractional shares, shall equal the option exercise price of
the total number of shares of Common Stock to be acquired, (iii) to exercise all
or a portion of an Option by delivering that number of shares of Common Stock
already owned by him having a Fair Market Value which shall equal the Option
exercise price for the portion exercised and, in cases where an Option is not
exercised in its entirety, to permit the Optionee to deliver the shares of
Common Stock thus acquired by him in payment of shares of Common Stock to be
received pursuant to the exercise of additional portions of such Option, the
effect of which shall be that an Optionee can in sequence utilize such newly
acquired shares of Common Stock in payment of the exercise price of the entire
Option, together with such cash as shall be paid in respect of fractional shares
and (iv) to engage in any form of "cashless" exercise.
C. Withholding. The establishment of a procedure whereby a number of shares
of Common Stock or other securities may be withheld from the total number of
shares of Common Stock or other securities to be issued upon exercise of an
Option, or for the tender of cash or shares of Common Stock owned by any
Participant to meet any obligation of withholding for taxes incurred by the
Optionee upon such exercise.
D. Types of Plan Awards. The Committee may grant awards in the form of
Incentive Stock Options and Non-Qualified Stock Options.
SECTION V.
<PAGE>
STOCK OPTIONS
A. For Employees.
The Committee shall have the authority, in its discretion, to
grant Incentive Stock Options or to grant Non-Qualified Stock Options or to
grant both types of Options. No Option shall be granted for a term of more than
ten (10) years. Notwithstanding anything contained herein to the contrary, an
Incentive Stock Option may be granted only to common law employees of the
Corporation or of any Parent or Subsidiary now existing or hereafter formed or
acquired, and not to any director or officer who is not also such a common law
employee. In order to satisfy the "performance-based" exception to the deduction
limitation under Code Section 162(m), the maximum number of shares of Common
Stock subject to Options which may be granted to any single Executive during any
one calendar year is 250,000. Option grants made under the IntelCom Plan during
1996 shall be taken into account in determining whether this limitation is
satisfied under this Plan during such year. The terms and conditions of the
Options shall be determined from time to time by the Committee; provided,
however, that the Options granted under the Plan shall be subject to the
following:
I. Exercise Price. The Committee shall establish the exercise
price at the time any Option is granted at such amount as the Committee shall
determine; provided, however, that the exercise price for each share of Common
Stock purchasable under any Option which is intended to satisfy the
performance-based exception to the deduction limitation under Section 162(m) of
the Code or any Incentive Stock Option granted hereunder shall be such amount as
the Committee shall, in its best judgment, determine to be not less than one
hundred percent (100%) of the Fair Market Value per share of Common Stock at the
date the Option is granted; and provided, further, that in the case of an
Incentive Stock Option granted to a person who, at the time such Incentive Stock
Option is granted, owns shares of stock of the Corporation or of any Parent or
Subsidiary which possess more than ten percent (10%) of the total combined
voting power of all classes of shares of stock of the Corporation or of any
Parent or Subsidiary, the exercise price for each share of Common Stock shall be
such amount as the Committee, in its best judgment, shall determine to be not
less than one hundred ten percent (110%) of the Fair Market Value per share of
Common Stock at the date the Option is granted. The exercise price will be
subject to adjustment in accordance with the provisions of Section VI of the
Plan.
<PAGE>
(ii) Payment of Exercise Price. The price per share of Common
Stock with respect to each Option shall be payable at the time the Option is
exercised. Such price shall be payable in cash or pursuant to any of the methods
set forth in Sections IV(A) or (B) hereof. Shares of Common Stock delivered to
the Corporation in payment of the exercise price shall be valued at the Fair
Market Value of the Common Stock on the date preceding the date of the exercise
of the Option.
(iii) Employment Requirement. Notwithstanding anything else
contained herein, each Option by its terms shall require the Optionee to remain
in the continuous full-time employ of the Corporation, or of any Parent or
Subsidiary, for at least six (6) months from the date of grant of the Option
before the right to exercise any part of the Option (by him or any other person)
will accrue.
(iv) Exercisability of Options. Each Option shall be
exercisable in whole or in installments, and at such time(s), and subject to the
fulfillment of any conditions on exercisability as may be determined by the
Committee at the time of the grant of such Options. The right to
purchase shares of Common Stock shall be cumulative so that when the right to
purchase any shares of Common Stock has accrued such shares of Common Stock or
any part thereof may be purchased at any time thereafter until the expiration or
termination of the Option. Unless otherwise determined by the Committee in its
sole discretion, each Option granted hereunder shall be exercisable, on a
cumulative basis, as to twenty-five percent (25%) of the shares of Common Stock
set forth thereunder on each of the first, second, third and fourth
anniversaries of the date such Option is granted.
(v) Expiration of Options. No Option by its terms shall be
exercisable after the expiration of ten (10) years from the date of grant of the
Option; provided, however, in the case of an Incentive Stock Option granted to a
person who, at the time such Option is granted, owns shares of stock of the
Corporation or of any Parent or Subsidiary possessing more than ten percent
(10%) of the total combined voting power of all classes of shares of stock of
the Corporation or of any Parent or Subsidiary, such Option shall not be
exercisable after the expiration of five (5) years from the date such Option is
granted.
(vi) Exercise Upon Death of Optionee. Subject to the
provisions of Sections V(A)(iii) and V(A)(ix) hereof, in the event of the death
of the Optionee prior to his termination of employment with the Corporation or
with any Parent or Subsidiary, or within 3 (three) months following his
Retirement, his estate (or other beneficiary, if so designated in writing by the
Participant) shall have the right, within one (1) year after the date of death
(but in no case after the expiration date of the Option(s)), to exercise his
Option(s) with respect to all or any part of the shares of Common Stock as to
which the deceased Optionee had not exercised his Option at the time of his
death, but only to the extent the Option or Options were exercisable as of the
earlier of the date of his Retirement or the date of his death.
(vii) Exercise Upon Disability of Optionee. Subject to the
provisions of Sections V(A)(iii) and V(A)(ix) hereof, if the employment by the
Corporation or by any Parent or Subsidiary of an Optionee is terminated because
of Disability, he shall have the right, within one (1) year after the date of
such termination (but in no case after the expiration of the Option(s)), to
exercise his Option(s) with respect to all or any part of the shares of Common
Stock as to which he had not exercised his Option at the time of such
termination, but only to the extent such Option or Options were exercisable as
of the date of his termination of employment due to Disability.
(viii) Exercise Upon Optionee's Termination of Employment.
Except as provided in the following sentence, if the employment of an Optionee
by the Corporation or by any Parent or Subsidiary is terminated for any reason
other than those specified in Sections V(A)(vi) and V(A)(vii) above, he shall
have the right, within three (3) months after the date of such termination (but
in no case after the expiration date of the Option(s)), to exercise his
Option(s) only with respect to that number of shares of Common Stock that he was
entitled to purchase pursuant to Options that were exercisable immediately prior
to such termination. Notwithstanding the provisions of the immediately preceding
sentence, if an Optionee's employment is terminated by the Corporation or by any
Parent or Subsidiary for Good Cause or upon his voluntary termination of
employment without the consent of the Committee, the Optionee shall, at the time
of such termination of employment, forfeit his rights to exercise all of such
Option(s).
(ix) Maximum Amount of Incentive Stock Options. Each Plan
Award under which Incentive Stock Options are granted shall provide that to the
extent the aggregate of the (a) Fair Market Value of the shares of Common Stock
(determined as of the time of the grant of the Option) subject to such Incentive
Stock Option and (b) the fair market values (determined as of the date(s) of
grant of the options) of all other shares of Common Stock subject to incentive
stock options granted to an Optionee by the Corporation or any Parent or
Subsidiary, which are exercisable for the first time by any person during any
calendar year, exceed(s) one hundred thousand dollars ($100,000), such excess
shares of Common Stock shall not be deemed to be purchased pursuant to Incentive
Stock Options. The terms of the immediately preceding sentence shall be applied
by taking options into account in the order in which they are granted.
<PAGE>
B. For Director Participants.
(i) General Provisions. Subject to the terms and conditions of this
Section V(B):
<PAGE>
(1) As of the last day of the Plan Quarter beginning on
October 1, 1995, each person who was serving as a non-employee director of the
Corporation or of any Parent or Subsidiary (a "Director") on the last day of
such Plan Quarter (and who so served on an uninterrupted basis for more than
fifty percent (50%) of the business days contained in such Plan Quarter) was
automatically granted under the IntelCom Plan an option to purchase five
thousand (5,000) shares of IntelCom common stock, subject to availability under
the IntelCom Plan.
<PAGE>
(2) As of January 1, 1996, each individual who was serving as
a Director on such date was automatically granted under the IntelCom Plan an
option to purchase fifteen thousand (15,000) shares of IntelCom common stock,
subject to availability under the IntelCom Plan.
(3) As of October 1, 1996, each individual who is serving as a
Director on such date shall automatically be granted an Option to purchase five
thousand (5,000) shares of Common Stock, subject to availability under the Plan.
(4) As of January 1, 1997, and as of the first day of each
succeeding calendar year through and including January 1, 2005, each individual
who is serving as a Director on the appropriate grant date shall automatically
be granted Options to purchase twenty thousand (20,000) shares of Common Stock,
subject to availability under the Plan.
Subject to the provisions of Section VI hereunder, (i) the option price of the
shares of Common Stock covered by each Option shall be the Fair Market Value of
such shares on the date of the grant; provided, however, that the option price
of the shares of Common Stock covered by each Option granted on October 1, 1996
shall be the greater of (i) the Fair Market Value of such shares on January 1,
1996 or (ii) an amount that is greater than twenty-five percent (25%) of the
Fair Market Value of such shares on October 1, 1996.
(ii) Exercisability of Stock Option. Each Option granted under this Section
V(B) by its terms shall expire ten (10) years from the date of its
grant. Furthermore:
(1) An Option described under Section V(B)(i)(1) became
exercisable in full on the date of grant of the Option.
(2) An Option described under Section V(B)(i)(2) became, and
shall become,
<PAGE>
exercisable as to one-third (1/3) of the number of shares of Common Stock
covered thereby on the last day of the Plan Quarter during which the date of
grant occurred and as to one-third (1/3) of such number of shares on the last
day of each of the next succeeding two Plan Quarters, respectively, but only if,
with regard to the shares of Common Stock with respect to which the Option
becomes exercisable at the end of any Plan Quarter, the Director has served in
such capacity on an uninterrupted basis for more than fifty percent (50%) of the
business days contained in such Plan Quarter.
(3) An option granted pursuant to Section V(B)(i)(3) shall
become exercisable on the last day of the Plan Quarter during which the date of
such grant occurs, but only if the Director has served in such capacity on an
uninterrupted basis for more than fifty percent (50%) of the business days
contained in such Plan Quarter.
(4) An Option granted pursuant to Section V(B)(i)(4) shall
become exercisable as to one-fourth (1/4) of the number of shares of Common
Stock covered thereby on the last day of the Plan Quarter during which the date
of grant occurs and as to one-fourth (1/4) of such number of shares on the last
day of each of the next succeeding three Plan Quarters, respectively, but only
if, with regard to the shares of Common Stock with respect to which the Option
becomes exercisable at the end of any Plan Quarter, the Director has served in
such capacity on an uninterrupted basis for more than fifty percent (50%) of the
business days contained in such Plan Quarter.
If a Director dies while holding an outstanding Option, such Option, to the
extent exercisable (and not exercised) on the date of his death, shall remain so
exercisable by his estate (or other beneficiaries, as designated in writing by
such Director) until the end of the exercise period under the Option.
(iii) Director's Termination. If a Director's service as a
director of the Corporation is terminated by reason of (1) his Disability, (2)
the failure of the Corporation to retain, or nominate for re-election, such
Director (who is otherwise eligible) other than for Good Cause, (3) his
ineligibility for re-election pursuant to the Corporation's By-laws, or (4) his
voluntary termination of such directorship, such termination shall be considered
a "Qualifying Termination" and each Option granted to such Director, to the
extent exercisable (and not exercised) on the date of such Qualifying
Termination, shall remain so exercisable by him until the end of the exercise
period under such Option. If a Director's service as a director of the
Corporation or of any Parent or Subsidiary is terminated for Good Cause, such
termination shall be considered a "Non-Qualifying Termination." In the event of
a Non-Qualifying Termination, all outstanding unexercised stock options granted
pursuant to this Section V(B) shall be forfeited or canceled, as the case may
be.
SECTION VI.
ADJUSTMENT OF SHARES; MERGER OR
CONSOLIDATION, ETC. OF THE CORPORATION
A. Recapitalization, Etc. In the event there is any change in
the Common Stock of the Corporation by reason of any reorganization,
recapitalization, stock split, stock dividend or otherwise, there shall be
substituted for or added to each share of Common Stock theretofore appropriated
or thereafter subject, or which may become subject, to any Option, the number
and kind of shares of stock or other securities into which each outstanding
share of Common Stock shall be so changed or for which each such share shall be
exchanged, or to which
<PAGE>
each such share be entitled, as the case may be, and the per share price thereof
also shall be appropriately adjusted. Notwithstanding the foregoing, (i) each
such adjustment with respect to an Incentive Stock Option shall comply with the
rules of Section 424(a) of the Code and (ii) in no event shall any adjustment be
made which would render any Incentive Stock Option granted hereunder to be other
than an incentive stock option for purposes of Section 422 of the Code.
B. Merger, Consolidation or Change in Control of Corporation.
Upon (i) the merger or consolidation of the Corporation with or into another
corporation (pursuant to which the stockholders of the Corporation immediately
prior to such merger or consolidation will not, as of the date of such merger or
consolidation, own a beneficial interest in shares of voting securities of the
corporation surviving such merger or consolidation having at least a majority of
the combined voting power of such corporation's then outstanding securities), if
the agreement of merger or consolidation does not provide for (1) the
continuance of the Options granted hereunder or (2) the substitution of new
options for Options granted hereunder, or for the assumption of such Options by
the surviving corporation, (ii) the dissolution, liquidation or sale of
substantially all the assets of the Corporation or (iii) the Change in Control
of the Corporation, the holder of any such Option theretofore granted and still
outstanding (and not otherwise expired) shall have the right immediately prior
to the effective date of such merger, consolidation, dissolution, liquidation,
sale of assets or Change in Control of the Corporation to exercise such
Option(s) in whole or in part without regard to any installment provision that
may have been made part of the terms and conditions of such Option(s); [provided
that any conditions precedent to the exercise of such Options, other than the
passage of time, have occurred]. The Corporation, to the extent practicable,
shall give advance notice to affected Optionees of any such merger,
consolidation, dissolution, liquidation, sale of assets or Change in Control of
the Corporation. All such Options which are not so exercised shall be forfeited
as of the effective time of any merger, consolidation, dissolution, liquidation
or sale of assets (but not in the case of a Change in Control of the
Corporation).
C. Definition of Change in Control of the Corporation. As used
herein, a "Change in Control of the Corporation" shall be deemed to have
occurred if any person (including any individual, firm, partnership or other
entity) together with all Affiliates and Associates (as defined under Rule 12b-2
of the General Rules and Regulations promulgated under the Exchange Act) of such
person, but excluding (i) a trustee or other fiduciary holding securities under
an employee benefit plan of the Corporation or any subsidiary of the
Corporation, (ii) a corporation owned, directly or indirectly, by the
stockholders of the Corporation in substantially the same proportions as their
ownership of the Corporation, (iii) the Corporation or any subsidiary of the
Corporation or (iv) only as provided in the immediately following sentence, a
Participant together with all Affiliates and Associates of a Participant, is or
becomes the Beneficial Owner (as defined in Rule 13d-3 promulgated under the
Exchange Act), directly or indirectly, of securities of the Corporation
representing 40% of more of the combined voting power of the Corporation's then
outstanding securities, such person being hereinafter referred to as an
Acquiring Person. The provisions of clause (iv) of the immediately preceding
sentence shall apply only with respect to the Option(s) held by the Participant
who, together with his Affiliates or Associates, if any, is or becomes the
direct or indirect Beneficial Owner of the percentage of securities set forth in
such clause.
<PAGE>
SECTION VII.
MISCELLANEOUS PROVISIONS
A. Administrative Procedures. The Committee may establish any procedures
determined by it to be appropriate in discharging its responsibilities under the
Plan. Subject to the provisions of Section X hereof, all actions and decisions
of the Committee shall be final.
B. Assignment or Transfer. No grant or award of any Incentive Stock Option
or any other "derivative security" (as defined by Rule 16a-l(c) promulgated
under the Exchange Act) made under the Plan or any rights or interests therein
shall be assignable or transferable by a Participant except by will or the laws
of descent and distribution or pursuant to a domestic relations order. During
the lifetime of a Participant, Options granted hereunder shall be exercisable
only by the Participant.
C. Investment Representation. Upon the exercise of an Option, the Committee
may require, as a condition of receiving such securities, that the Participant
furnish to the Corporation such written representations and information as the
Committee deems appropriate to permit the Corporation, in light of the existence
or nonexistence of an effective registration statement under the Securities Act
to deliver such securities in compliance with the provisions of the Securities
Act.
D. Withholding Taxes. The Corporation shall have the right to deduct from
all cash payments hereunder any federal, state, local or foreign taxes required
by law to be withheld with respect to such payments. In the case of the issuance
or distribution of Common Stock or other securities hereunder, the Corporation,
as a condition of such issuance or distribution, may require the payment
(through withholding from the Participant's salary, reduction of the number of
shares of Common Stock or other securities to be issued, or otherwise) of any
such taxes. The Participant may satisfy the withholding obligations by paying to
the Corporation a cash amount equal to the amount required to be withheld or by
tendering to the Corporation a number of shares of Common Stock having a value
equivalent to such cash amount, or by use of any available procedure as
described under Section IV(C) hereof.
E. Costs and Expenses. The costs and expenses of administering the Plan
shall be borne by the Corporation and shall not be charged against any award nor
to any employee receiving a Plan Award.
F. Funding of Plan. The Plan shall be unfunded. The Corporation shall not
be required to segregate any of its assets to assure the payment of any Plan
Award under the Plan. Neither the Participants nor any other persons shall have
any interest in any fund or in any specific asset or assets of the Corporation
or any other entity by reason of any Plan Award, except to the extent expressly
provided hereunder. The interests of each Participant and former Participant
hereunder are unsecured and shall be subject to the general creditors of the
Corporation.
G. Other Incentive Plans. The adoption of the Plan does not preclude the
adoption by appropriate means of any other incentive plan for employees.
H. Plurals and Gender. Where appearing in the Plan, masculine gender shall
include the feminine and neuter genders, and the singular shall include the
plural, and vice versa, unless the context clearly indicates a different
meaning.
<PAGE>
I. Headings. The headings and sub-headings in this Plan are inserted for
the convenience of reference only and are to be ignored in any construction of
the provisions hereof.
J. Severability. In case any provision of this Plan shall be held illegal
or void, such illegality or invalidity shall not affect the remaining provisions
of this Plan, but shall be fully severable, and the Plan shall be construed and
enforced as if said illegal or invalid provisions had never been inserted
herein.
K. Payments Due Missing Persons. The Corporation shall make a reasonable
effort to locate all persons entitled to benefits under the Plan; however,
notwithstanding any provisions of this Plan to the contrary, if, after a period
of one (1) year from the date such benefits shall be due, any such persons
entitled to benefits have not been located, their rights under the Plan shall
stand suspended. Before this provision becomes operative, the Corporation shall
send a certified letter to all such persons at their last known addresses
advising them that their rights under the Plan shall be suspended. Subject to
all applicable state laws, any such suspended amounts shall be held by the
Corporation for a period of one (1) additional year and thereafter such amounts
shall be forfeited and thereafter remain the property of the Corporation.
L. Liability and Indemnification. (i) Neither the Corporation nor any
Parent or Subsidiary shall be responsible in any way for any action or omission
of the Committee, or any other fiduciaries in the performance of their duties
and obligations as set forth in this Plan. Furthermore, neither the Corporation
nor any Parent or Subsidiary shall be responsible for any act or omission of any
of their agents, or with respect to reliance upon advice of their counsel
provided that the Corporation and/or the appropriate Parent or Subsidiary relied
in good faith upon the action of such agent or the advice of such counsel.
(ii) Except for their own gross negligence or willful
misconduct regarding the performance of the duties specifically
assigned to them under, or their willful breach of the terms of, this
Plan, the Corporation, each Parent and Subsidiary and the Committee
shall be held harmless by the Participants, former Participants,
beneficiaries and their representatives against liability or losses
occurring by reason of any act or omission. Neither the Corporation,
any Parent or Subsidiary, the Committee, nor any agents, employees,
officers, directors or shareholders of any of them, nor any other
person shall have any liability or responsibility with respect to this
Plan, except as expressly provided herein.
M. Incapacity. If the Committee shall receive evidence satisfactory to it
that a person entitled to receive payment of any Plan Award is, at the time when
such benefit becomes payable, a minor, or is physically or mentally incompetent
to receive such Plan Award and to give a valid release thereof, and that another
person or an institution is then maintaining or has custody of such person and
that no guardian, committee or other representative of the estate of such person
shall have been duly appointed, the Committee may make payment of such Plan
Award otherwise payable to such person to such other person or institution,
including a custodian under a Uniform Gifts to Minors Act, or corresponding
legislation (who shall be an adult, a guardian of the minor or a trust company),
and the release by such other person or institution shall be a valid and
complete discharge for the payment of such Plan Award.
N. Cooperation of Parties. All parties to this Plan and any person claiming
any interest hereunder agree to perform any and all acts and execute any and all
documents and papers which are necessary or desirable for carrying out this Plan
or any of its provisions.
O. Governing Law. All questions pertaining to the validity, construction
and administration of the Plan shall be determined in accordance with the laws
of the State of Delaware.
P. Nonguarantee of Employment. Nothing contained in this Plan shall be
construed as a contract of employment between the Corporation (or any Parent or
Subsidiary), and any employee or Participant, as a right of any employee or
Participant to be continued in the employment of the Corporation (or any Parent
or Subsidiary), or as a limitation on the right of the Corporation or any Parent
or Subsidiary to discharge any of its employees, with or without cause.
Q. Notices. Each notice relating to this Plan shall be in writing and
delivered in person or by certified mail to the proper address. All notices to
the Corporation or the Committee shall be addressed to it at ICG Communications,
Inc., 9605 Maroon Circle, P.O. Box 6742, Englewood, Colorado 80155-6742, Attn:
Secretary. All notices to Participants, former Participants, beneficiaries or
other persons acting for or on behalf of such persons shall be addressed to such
person at the last address for such person maintained in the Committee's
records.
R. Written Agreements. Each Plan Award shall be evidenced by a signed
written agreement between the Corporation and the Participant containing the
terms and conditions of the award.
SECTION VIII.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors of the Corporation shall have the right
to amend, suspend or terminate the Plan and the Options granted hereunder at any
time and for any purpose (including, without limitation, an amendment necessary
for an Option to maintain its qualification as an "incentive stock option"
within the meaning of Section 422 of the Code, if applicable, or to comply with
Rule 16b-3 (or any successor rule) promulgated under the Exchange Act);
provided, however, that no amendment shall be made which shall increase the
total number of shares of the Common Stock of the Corporation which may be
issued and sold pursuant to Options, reduce the minimum exercise price in the
case of an Incentive Stock Option or modify the provisions of the Plan relating
to eligibility, unless such amendment is made by or with the approval of the
stockholders (such approval being granted within 12 months of the effective date
of such amendment), but only if such approval is required by any applicable
provisions of the Code. Except as otherwise provided herein, no amendment,
suspension or termination of the Plan shall alter or impair any Plan Awards
previously granted under the Plan, without the consent of the holder thereof.
SECTION IX.
TERM OF PLAN
The Plan shall remain in effect until September 30, 2005,
which is the day prior to the tenth anniversary of the effective date of the
IntelCom Plan, unless sooner terminated by the Board of Directors of the
Corporation. No Plan Awards may be granted under the Plan subsequent to the
termination of the Plan.
<PAGE>
SECTION X.
CLAIMS PROCEDURES
A. Denial. If any Participant, former Participant or beneficiary is denied
any vested benefit to which he is, or reasonably believes he is, entitled under
this Plan, either in total or in an amount less than the full vested benefit to
which he would normally be entitled, the Committee shall advise such person in
writing the specific reasons for the denial. The Committee shall also furnish
such person at the time with a written notice containing (i) a specific
reference to pertinent Plan provisions, (ii) a description of any additional
material or information necessary for such person to perfect his claim, if
possible, and an explanation of why such material or information is needed and
(iii) an explanation of the Plan's claim review procedure.
B. Written Request for Review. Within 60 days of receipt of the information
stated in subsection (a) above, such person shall, if he desires further review,
file a written request for reconsideration with the Committee.
C. Review of Document. So long as such person's request for review is
pending (including the 60 day period in subsection (b) above), such person or
his duly authorized representative may review pertinent Plan documents and may
submit issues and comments in writing to the Committee.
D. Committee's Final and Binding Decision. A final and binding decision
shall be made by the Committee within 60 days of the filing by such person of
this request for reconsideration; provided, however, that if the Committee, in
its discretion, feels that a hearing with such person or his representative is
necessary or desirable, this period shall be extended for an additional 60 days.
E. Transmittal of Decision. The Committee's decision shall be conveyed to
such person in writing and shall (i) include specific reasons for the decision,
(ii) be written in a manner calculated to be understood by such person and (iii)
set forth the specific references to the pertinent Plan provisions on which the
decision is based.
F. Limitation on Claims. Notwithstanding any provisions of this Plan to the
contrary, no Participant (nor the estate or other beneficiary of a Participant)
shall be entitled to assert a claim against the Corporation (or against any
Parent or Subsidiary) more than three years after the date the Participant (or
his estate or other beneficiary) initially is entitled to receive benefits
hereunder.
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EXHIBIT 4.6A
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NON-QUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made as of this [ ] day of [ ], [199__] between ICG
Communications, Inc., a Delaware corporation (hereinafter referred to as the
"Company"), and [ ], residing at [ ] (hereinafter referred to as the
"Employee").
W I T N E S S E T H:
WHEREAS, the Company desires, in connection with the
employment of the Employee and in accordance with its 1996 Stock Option Plan
(the "Plan"), to provide the Employee with an opportunity to acquire Common
Stock, $.01 par value (hereinafter referred to as "Common Stock"), of the
Company on favorable terms and thereby increase his proprietary interest in the
continued progress and success of the business of the Company;
NOW, THEREFORE, in consideration of the premises, the mutual
covenants herein set forth and other good and valuable consideration, the
Company and the Employee hereby agree as follows:
1. Grant of Option. Pursuant to a determination by the Stock Option
Committee of the Board of Directors of the Company authorized to administer the
Plan made on [ ] (the "Date of Grant"), the Company, subject to the terms of the
Plan and this Agreement, hereby grants to the Employee as a matter of separate
inducement and agreement, and in addition to and not in lieu of salary or other
compensation for services, the right to purchase (hereinafter referred to as the
"Option") an aggregate of [ ] shares of Common Stock, subject to adjustment as
provided in Section 8 hereof (such shares, as adjusted, shall hereinafter be
referred to as the "Shares"). The Option is not intended to qualify as an
incentive stock option under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
2. Purchase Price. The purchase price of shares of Common Stock covered by
the Option will be [$ ] per share, subject to adjustment as provided in Section
8 hereof.
3. Exercise of Option. The Option shall be exercisable on the terms and
conditions hereinafter set forth:
(a) The Option shall become exercisable cumulatively as to the
following amounts of the number of Shares originally subject thereto (after
giving effect to any adjustment pursuant to Section 8 hereof), on the dates
indicated:
(i) as to [ ] Shares on or after [not earlier than one (1) year after
the date of grant];
(ii) as to [ ] Shares on or after [ ];
(iii) as to [ ] Shares on or after [ ]; and
(iv) as to [ ] Shares on or after [ ].
(b) The Option may be exercised pursuant to the provisions of this
Section 3, by notice and payment (including, but not limited to, a cashless
exercise) to the
<PAGE>
Company as provided in Sections 11 and 16 hereof.
4. Term of Option. The term of the Option shall be a period of ten (10)
years from the Date of Grant. This Option, to the extent unexercised, shall
expire on the day immediately prior to the tenth anniversary of the Date of
Grant. The holder of the Option shall not have any rights to dividends or any
other rights of a stockholder with respect to any shares of Common Stock subject
to the Option until such shares shall have been issued to him (as evidenced by
the appropriate entry on the books of a duly authorized transfer agent of the
Company) provided that the date of issuance shall not be earlier than the date
this Option is exercised and provision of the purchase price of the shares of
Common Stock (with respect to which this Option is being exercised) is made to
the Company pursuant to the provisions contained herein.
5. Non-transferability of Option. The Option shall not be transferable
otherwise than by will or by the laws of descent and distribution, or pursuant
to a domestic relations order, and the Option may be exercised during the
lifetime of the Employee only by him. More particularly, but without limiting
the generality of the foregoing, the Option may not be assigned, transferred
(except as provided in the next preceding sentence) or otherwise disposed of, or
pledged or hypothecated in any way, and shall not be subject to execution,
attachment or other process. Any assignment, transfer, pledge, hypothecation or
other disposition of the Option attempted contrary to the provisions of this
Agreement, or any levy of execution, attachment or other process attempted upon
the Option, will be null and void and without effect. Any attempt to make any
such assignment, transfer, pledge, hypothecation or other disposition of the
Option or any attempt to make any such levy of execution, attachment or other
process will cause the Option to terminate immediately upon the happening of any
such event; provided, however, that any such termination of the Option under the
foregoing provisions of this Section 5 will not prejudice any rights or remedies
which the Company or any Parent or Subsidiary may have under this Agreement or
otherwise.
6. Exercise Upon Cessation of Employment. (a) If the Employee at any time
ceases to be an employee of the Company or of any Parent or Subsidiary (i) by
reason of his discharge for Good Cause or (ii) due to his voluntary termination
of employment without the consent of the Committee, the Option shall, at the
time of such termination of employment, terminate and the Employee shall forfeit
all rights hereunder. If, however, the Employee for any other reason (other than
Disability or death) ceases to be such an employee, the Option may, subject to
the provisions of Section 5 hereof, be exercised by the Employee to the same
extent the Employee would have been entitled under Section 3 hereof to exercise
the Option immediately prior to such cessation of employment, at any time within
three (3) months after such cessation of employment, at the end of which period
the Option to the extent not then exercised, shall terminate and the Employee
shall forfeit all rights hereunder, even if the Employee subsequently returns to
the employ of the Company or any Parent or Subsidiary. In no event, however, may
the Option be exercised after the expiration of the term provided in Section 4
hereof.
(b) The Option shall not be affected by any change of duties or
position of the Employee so long as he continues to be a full-time employee
of the Company or of any Parent or Subsidiary thereof. If the Employee is
granted a temporary leave of absence, such leave of absence shall be deemed
a continuation of his employment by the Company or of any Parent or
Subsidiary thereof for the purposes of this Agreement, but only if and so
long as the employing corporation consents thereto.
<PAGE>
7. Exercise Upon Death or Disability. (a) If the Employee dies while he is
employed by the Company or by any Parent or Subsidiary (or within three (3)
months after his Retirement), and on or after the first date upon which he would
have been entitled to exercise the Option under the provisions of Section 3
hereof, the Option may, subject to the provisions of Section 5 hereof, be
exercised with respect to all or any part of the shares of Common Stock as to
which the deceased Employee had not exercised the Option at the time of his
death (but only to the extent the Option was exercisable at the earlier of (i)
the date of his Retirement or (ii) the date of his death), by the estate of the
Employee (or by the person or persons who acquire the right to exercise the
Option by written designation of the Employee) at any time within one (1) year
after the date of the Employee's death (in no event, however, after the
expiration of the term provided in Section 4 hereof), at the end of which period
the Option, to the extent not then exercised, shall terminate and the Director
shall forfeit all rights hereunder.
(b) In the event that the employment of the Employee by the Company
and any Parent or Subsidiary is terminated by reason of the Disability of
the Employee on or after the first date upon which he would have been
entitled to exercise the Option under the provisions of Section 3 hereof,
the Option may, subject to the provisions of Section 5 hereof, be exercised
with respect to all or any part of the shares of Common Stock as to which
he had not exercised the Option at the time of his Disability (but only to
the extent the Option was exercisable at such time) by the Employee at any
time within the period ending one (1) year after the date of such
termination of employment (in no event, however, after the expiration of
the term provided in Section 4 hereof), at the end of which period the
Option, to the extent not then exercised, shall terminate and the Employee
shall forfeit all rights hereunder even if the Employee subsequently
returns to the employ of the Company or any Parent or Subsidiary.
8. Adjustments. In the event there is any change in the Common Stock of the
Company by reason of any reorganization, recapitalization, stock split, stock
dividend or otherwise, there shall be substituted for or added to each share of
Common Stock theretofore appropriated or thereafter subject, or which may become
subject, to this Option the number and kind of shares of stock or other
securities into which each outstanding share of Common Stock shall be so changed
or for which each such share shall be exchanged, or to which each such share
shall be entitled, as the case may be, and the per share price thereof also
shall be appropriately adjusted.
9. Merger or Consolidation, Etc. of the Company. Upon (a) the merger or
consolidation of the Company with or into another corporation (pursuant to which
the stockholders of the Company immediately prior to such merger or
consolidation will not, as of the date of such merger or consolidation, own a
beneficial interest in shares of voting securities of the corporation surviving
such merger or consolidation having at least a majority of the combined voting
power of such corporation's then outstanding securities), if the agreement of
merger or consolidation does not provide for (i) the continuance of this Option,
or (ii) the substitution of new option(s) for this Option, or for the assumption
of such Option by the surviving corporation, (b) the dissolution, liquidation or
sale of substantially all the assets of the Company or (c) a Change in Control
of the Corporation, the Employee shall have the right immediately prior to the
effective date of such merger, consolidation, dissolution, liquidation, sale of
assets or Change in Control of the Corporation to exercise this Option (to the
extent not exercised and not otherwise expired) in whole or in part without
regard to any installment provision that may have been made part of the terms
and conditions of this Option, provided that any conditions precedent to the
exercise of this Option, other than the passage of time, have occurred. The
Company, to the extent practicable, shall give advance notice to the Employee of
<PAGE>
such merger, consolidation, dissolution, liquidation, sale of assets or Change
in Control of the Corporation. To the extent this Option is not so exercised, it
shall be forfeited as of the effective time of any merger, consolidation,
dissolution, liquidation or sale of assets (but not in the case of a Change in
Control of the Corporation).
10. Registration. The shares of Common Stock subject hereto and issuable
upon the exercise hereof may not be registered under the Securities Act of 1933,
as amended, and, if required upon the request of counsel to the Company, the
Employee will give a representation as to his investment intent with respect to
such shares prior to their issuance as set forth in Section 11 hereof.
The Company may register or qualify the shares covered by the Option for
sale pursuant to the Securities Act of 1933, as amended, at any time prior to or
after the exercise in whole or in part of the Option.
11. Method of Exercise of Option. (a) Subject to the terms and conditions
of this Agreement, the Option shall be exercisable by notice in the manner set
forth in Exhibit A hereto (the "Notice") and provision for payment to the
Company in accordance with the procedure prescribed herein. Each such Notice
shall:
(i) state the election to exercise the Option and the number of Shares
in respect of which it is being exercised;
(ii) contain a representation and agreement as to investment intent,
if required by counsel to the Company with respect to such Shares, in form
satisfactory to counsel for the Company;
(iii) be signed by the Employee or the person or persons entitled to
exercise the Option and, if the Option is being exercised by any person or
persons other than the Employee, be accompanied by proof, satisfactory to
counsel for the Company, of the right of such person or persons to exercise
the Option; and
(iv) be received by the Company on or before the date of the
expiration of this Option. In the event the date of expiration of this
Option falls on a day which is not a regular business day at the Company's
executive office in Englewood, Colorado, then such written notice must be
received at such office on or before the last regular business day prior to
such date of expiration.
(b) Payment of the purchase price of any shares of Common Stock, in
respect of which the Option shall be exercised, shall be made by the
Employee or such person or persons at the place specified by the Company at
the time the Notice is delivered to the Company (i) by delivering to the
Company a certified or bank cashier's check payable to the order of the
Company, (ii) by delivering to the Company properly endorsed certificates
of shares of Common Stock (or certificates accompanied by an appropriate
stock power) with signature guaranties by a bank or trust company, (iii) by
having withheld from the total number of shares of Common Stock to be
acquired upon the exercise of this Option a specified number of such shares
of Common Stock, (iv) by any form of "cashless" exercise, or
(v) by any combination of the above.
(c) The Option shall be deemed to have been exercised with respect to
any particular shares of Common Stock if, and only if, the preceding
provisions of this Section
<PAGE>
11 and the provisions of Section 12 hereof shall
have been complied with, in which event the Option shall be deemed to have
been exercised on the date the Notice of exercise of the Option was
received by the Company. Anything in this Agreement to the contrary
notwithstanding, any notice of exercise given pursuant to the provisions of
this Section 11 shall be void and of no effect if all the preceding
provisions of this Section 11 and the provisions of Section 12 shall not
have been complied with.
(d) The certificate or certificates for shares of Common Stock as to
which the Option shall be exercised will be registered in the name of the
Employee (or in the name of the Employee's estate or other beneficiary if
the Option is exercised after the Employee's death), or if the Option is
exercised by the Employee and if the Employee so requests in the notice
exercising the Option, will be registered in the name of the Employee and
another person jointly, with right of survivorship and will be delivered as
soon as practical after the date the Notice (and full payment) is received
by the Company, but only upon compliance with all of the provisions of this
Agreement.
(e) If the Employee fails to accept delivery of and pay for all or any
part of the number of Shares specified in such Notice upon tender or
delivery thereof, his right to exercise the Option with respect to such
undelivered Shares may be terminated in the sole discretion of the Board of
Directors of the Company. The Option may be exercised only with respect to
full Shares.
(f) The Company shall not be required to issue or deliver any
certificate or certificates for shares of its Common Stock purchased upon
the exercise of any part of this Option prior to the payment to the
Company, upon its demand, of any amount requested by the Company for the
purpose of satisfying its liability, if any, to withhold state or local
income or earnings tax or any other applicable tax or assessment (plus
interest or penalties thereon, if any, caused by a delay in making such
payment) incurred by reason of the exercise of this Option or the transfer
of shares thereupon. Such payment shall be made by the Employee in cash or,
with the consent of the Company, by tendering to the Company shares of
Common Stock equal in value to the amount of the required withholding. In
the alternative, the Company may, at its option, satisfy such withholding
requirements by withholding from the shares of Common Stock to be delivered
to the Employee pursuant to an exercise of this Option a number of shares
of Common Stock equal in value to the amount of the required withholding.
12. Approval of Counsel. The exercise of the Option and the issuance and
delivery of shares of Common Stock pursuant thereto shall be subject to approval
by the Company's counsel of all legal matters in connection therewith,
including, but not limited to, compliance with the requirements of the
Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, and the requirements of any
stock exchange upon which the Common Stock may then be listed.
13. Resale of Common Stock. (a) If so requested by the Company, upon any
sale or transfer of the Common Stock purchased upon exercise of the Option, the
Employee shall deliver to the Company an opinion of counsel satisfactory to the
Company to the effect that either (i) the Common Stock to be sold or transferred
has been registered under the Securities Act of 1933, as amended, and that there
is in effect a current prospectus meeting the requirements of Section 10(a) of
said Act which is being or will be delivered to the purchaser or transferee at
or prior to the time of delivery of the certificates evidencing the Common Stock
to be sold or transferred, or (ii) such Common Stock may then be sold without
violating Section 5 of said Act.
<PAGE>
(b) The Common Stock issued upon exercise of the Option shall bear the
following legend if required by counsel for the Company:
THE SHARES EVIDENCED BY THIS CERTIFICATE MAY NOT BE SOLD,
TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF
UNLESS THEY HAVE FIRST BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR UNLESS, IN THE OPINION OF COUNSEL
FOR THE COMPANY, SUCH REGISTRATION IS NOT REQUIRED.
14. Reservation of Shares. To the extent shares of Common Stock are not
readily tradable over an established securities market, the Company shall at all
times during the term of the Option reserve and keep available such number of
shares of the class of stock then subject to the Option as will be sufficient to
satisfy the requirements of this Agreement.
15. Limitation of Action. The Employee and the Company each acknowledges
that every right of action accruing to him or it, as the case may be, and
arising out of or in connection with this Agreement against the Company or a
Parent or Subsidiary, on the one hand, or against the Employee, on the other
hand, shall, irrespective of the place where an action may be brought, cease and
be barred by the expiration of three years from the date of the act or omission
in respect of which such right of action arises.
16. Notices. Each notice relating to this Agreement shall be in writing and
delivered in person or by certified mail to the proper address. All notices to
the Company or the Committee shall be addressed to them at 9605 Maroon Circle,
P.O. Box 6742, Englewood, Colorado 80155-6742, Attn: Secretary. All notices to
the Employee shall be addressed to the Employee or such other person or persons
at the Employee's address above specified. Anyone to whom a notice may be given
under this Agreement may designate a new address by notice to that effect.
17. Benefits of Agreement. This Agreement shall inure to the benefit of and
be binding upon each successor and assign of the Company. All obligations
imposed upon the Employee and all rights granted to the Company under this
Agreement shall be binding upon the Employee's heirs, legal representatives and
successors.
18. Severability. In the event that any one or more provisions of this
Agreement shall be deemed to be illegal or unenforceable, such illegality or
unenforceability shall not affect the validity and enforceability of the
remaining legal and enforceable provisions hereof, which shall be construed as
if such illegal or unenforceable provision or provisions had not been inserted.
19. Governing Law. This Agreement will be construed and governed in
accordance with the laws of the State of Delaware.
20. Employment. Nothing contained in this Agreement shall be construed as
(a) a contract of employment between the Employee and the Company or any Parent
or Subsidiary, (b) as a right of the Employee to be continued in the employ of
the Company or any Parent or Subsidiary, or (c) as a limitation of the right of
the Company or any Parent or
<PAGE>
Subsidiary to discharge the Employee at any time, with or without cause.
21. Definitions. Unless otherwise defined herein, all capitalized terms
shall have the same definitions as set forth under the Plan.
22. Incorporation of Terms of Plan. This agreement shall be interpreted
under, and subject to, all of the terms and provisions of the Plan, which are
incorporated herein by reference.
IN WITNESS WHEREOF, the Company has caused this Agreement to
be executed in its name by its President or one of its Vice Presidents and its
corporate seal to be hereunto affixed and attested by its Secretary or one of
its Assistant Secretaries and the Employee has hereunto set his hand all as of
the date, month and year first above written.
ICG COMMUNICATIONS, INC.
By:________________________________
Name:
Title:
-----------------------------------
[Name of Employee]
-----------------------------------
Social Security Number
ATTEST:
- -------------------------
Secretary
<PAGE>
EXHIBIT A
NON-QUALIFIED STOCK OPTION EXERCISE FORM
[DATE]
ICG Communications, Inc.
9605 East Maroon Circle
P.O. Box 6742
Englewood, Colorado 80155-6742
Dear Sirs:
Pursuant to the provisions of the Non-Qualified Stock Option
Agreement dated [ ], whereby you have granted to me a non-qualified stock option
to purchase [ ] shares of Common Stock of ICG Communications, Inc. (the
"Company"), I hereby notify you that I elect to exercise my option to purchase
________________ of the shares covered by such option at the price specified
therein. In full payment of the price for the shares being purchased hereby, I
am delivering to you herewith (a) a certified or bank cashier's check payable to
the order of the Company in the amount of $____________,* or (b) a certificate
or certificates for [ ] shares of Common Stock of the Company, and which have a
fair market value as of the date hereof of $___________, and a certified or bank
cashier's check, payable to the order of the Company, in the amount of
$________________.** Any such stock certificate or certificates are endorsed, or
accompanied by an appropriate stock power, to the order of the Company, with my
signature guaranteed by a bank or trust company or by a member firm of the New
York Stock Exchange. [I hereby acknowledge that I am purchasing these shares for
investment purposes only and not for resale.]
Very truly yours,
------------------------------
[Name]
[Address]
(For notices, reports, dividend
checks and other communications to
stockholders.)
<PAGE>
OPTION NO. 96-NQO-[ ]
ICG COMMUNICATIONS, INC.
1996 Stock Option Plan
NON-QUALIFIED STOCK OPTION
Granted To
----------------------------
Optionee
- ------------------------- -------------------------
Number of Shares Price per Share
DATE GRANTED:____________ EXPIRATION DATE:_________
- --------------------------------------------------------------------------------
EXHIBIT 4.6B
- --------------------------------------------------------------------------------
NON-QUALIFIED STOCK OPTION AGREEMENT
(for Directors)
AGREEMENT made as of this 1st day of October, 1996, between
ICG Communications, Inc., a Delaware corporation (hereinafter referred to as the
"Company"), and [ ], residing at [ ] (hereinafter referred to as the
"Director").
W I T N E S S E T H:
WHEREAS, the Company desires, in accordance with its 1996
Stock Option Plan (the "Plan"), to provide the Director with an opportunity to
acquire Common Stock, $.01 par value (hereinafter referred to as "Common
Stock"), of the Company on favorable terms and thereby increase his proprietary
interest in the continued progress and success of the business of the Company;
NOW, THEREFORE, in consideration of the premises, the mutual
covenants herein set forth and other good and valuable consideration, the
Company and the Director hereby agree as follows:
1. Grant of Option. Pursuant to the terms of the Plan, as of October 1,
1996 (the "Date of Grant") the Company, subject to the terms of the Plan and
this Agreement, hereby grants to the Director as a matter of separate inducement
and agreement, and in addition to and not in lieu of other compensation for
services, the right to purchase (hereinafter referred to as the "Option") an
aggregate of five thousand (5,000) shares of Common Stock, subject to adjustment
as provided in Section 8 hereof (such shares, as adjusted, shall hereinafter be
referred to as the "Shares"). The Option is not intended to qualify as an
incentive stock option under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
2. Purchase Price. The purchase price of shares of Common Stock covered by
the Option will be [$ ] per share, subject to adjustment as provided in Section
8 hereof.
3. Exercise of Option. The Option shall be exercisable on the terms and
conditions hereinafter set forth:
(a) The Option shall become exercisable in full on December 31, 1996;
provided, however, that the Option may be exercised with respect
to the Shares that otherwise become exercisable on the date set
forth above only if (x) the Director is actively serving as a
director of the Company on such date and (y) the Director
actively served as a Director of the Company on an uninterrupted
basis for more than fifty percent (50%) of the business days
contained in the three (3) calendar month period ending on such
date.
<PAGE>
(b) The Option may be exercised pursuant to the provisions of this
Section 3, by notice and payment (including, but not limited to,
a cashless exercise) to the Company as provided in Sections 11
and 16 hereof.
4. Term of Option. The term of the Option shall be a period of ten (10)
years from the Date of Grant. This Option, to the extent unexercised, shall
expire on the day immediately prior to the tenth anniversary of Date of Grant.
The holder of the Option shall not have any rights to dividends or any other
rights of a stockholder with respect to any shares of Common Stock subject to
the Option until such shares shall have been issued to him (as evidenced by the
appropriate entry on the books of a duly authorized transfer agent of the
Company) provided that the date of issuance shall not be earlier than the date
this Option is exercised and provision of the purchase price of the shares of
Common Stock (with respect to which this Option is being exercised) is made to
the Company pursuant to the provisions contained herein.
5. Non-transferability of Option. The Option shall not be transferable
otherwise than by will or by the laws of descent and distribution, or pursuant
to a domestic relations order, and the Option may be exercised during the
lifetime of the Director only by him. More particularly, but without limiting
the generality of the foregoing, the Option may not be assigned, transferred
(except as provided in the next preceding sentence) or otherwise disposed of, or
pledged or hypothecated in any way, and shall not be subject to execution,
attachment or other process. Any assignment, transfer, pledge, hypothecation or
other disposition of the Option attempted contrary to the provisions of this
Agreement, or any levy of execution, attachment or other process attempted upon
the Option, will be null and void and without effect. Any attempt to make any
such assignment, transfer, pledge, hypothecation or other disposition of the
Option or any attempt to make any such levy of execution, attachment or other
process will cause the Option to terminate immediately upon the happening of any
such event; provided, however, that any such termination of the Option under the
foregoing provisions of this Section 5 will not prejudice any rights or remedies
which the Company or any Parent or Subsidiary may have under this Agreement or
otherwise.
6. Exercise Upon Cessation of Service as Director. (a) If the Director at
any time ceases to be a director of the Company or of any Parent or Subsidiary
by reason of his removal for Good Cause, the Option shall, at the time of such
removal, terminate and the Director shall forfeit all rights hereunder. If,
however, the Director for any other reason (other than death) ceases to be such
a Director, the Option may, subject to the provisions of Section 5 hereof, be
exercised by the Director to the same extent the Director would have been
entitled under Section 3 hereof to exercise the Option on the date of such
cessation of directorship, at any time prior to the expiration of the term
provided in Section 4 hereof, at the end of which period the Option, to the
extent not then exercised, shall terminate and the Director shall forfeit all
rights hereunder.
(b) The Option shall not be affected by any change of duties or
position of the Director so long as he continues to be a director
of the Company or any Parent or
<PAGE>
Subsidiary thereof.
(c) If the Director dies while serving as a director of the Company
or of any Parent or Subsidiary, this Option, to the extent
exercisable (and not exercised) on the date of his death shall
remain so exercisable by his estate (or by other beneficiaries,
as designated in writing by the Director) until the expiration
date of this Option.
7. Exercise Upon Death. If the Director dies while he is a director of the
Company or of any Parent or Subsidiary, and on or after the first date upon
which he would have been entitled to exercise the Option under the provisions of
Section 3 hereof, the Option may, subject to the provisions of Section 5 hereof,
be exercised with respect to all or any part of the shares of Common Stock as to
which the deceased Director had not exercised the Option at the time of his
death (but only to the extent the Option was exercisable at such time), by the
estate of the Director (or by the person or persons who acquire the right to
exercise the Option by written designation of the Director) at any time prior to
the expiration of the term provided in Section 4 hereof, at the end of which
period the Option, to the extent not then exercised, shall terminate and the
Director shall forfeit all rights hereunder.
8. Adjustments. In the event there is any change in the Common Stock of the
Company by reason of any reorganization, recapitalization, stock split, stock
dividend or otherwise, there shall be substituted for or added to each share of
Common Stock theretofore appropriated or thereafter subject, or which may become
subject, to this Option the number and kind of shares of stock or other
securities into which each outstanding share of Common Stock shall be so changed
or for which each such share shall be exchanged, or to which each such share
shall be entitled, as the case may be, and the per share price thereof also
shall be appropriately adjusted.
9. Merger or Consolidation, Etc. of the Company. Upon (a) the merger or
consolidation of the Company with or into another corporation (pursuant to which
the stockholders of the Company immediately prior to such merger or
consolidation will not, as of the date of such merger or consolidation, own a
beneficial interest in shares of voting securities of the corporation surviving
such merger or consolidation having at least a majority of the combined voting
power of such corporation's then outstanding securities), if the agreement of
merger or consolidation does not provide for (i) the continuance of this Option,
or (ii) the substitution of new option(s) for this Option, or for the assumption
of such Option by the surviving corporation, (b) the dissolution, liquidation or
sale of substantially all the assets of the Company or (c) a Change in Control
of the Corporation, the Director shall have the right immediately prior to the
effective date of such merger, consolidation, dissolution, liquidation, sale of
assets or Change in Control of the Corporation to exercise this Option (to the
extent not exercised and not otherwise expired) in whole or in part without
regard to any installment provision that may have been made part of the terms
and conditions of this Option, provided that any conditions precedent to the
exercise of this Option, other than the passage of time, have occurred. To the
extent this Option is not so exercised, it shall be forfeited as of the
effective time of any merger, consolidation, dissolution, liquidation or sale of
assets (but not in the case of
<PAGE>
a Change in Control of the Corporation).
10. Registration. The shares of Common Stock subject hereto and issuable
upon the exercise hereof may not be registered under the Securities Act of 1933,
as amended, and, if required upon the request of counsel to the Company, the
Director will give a representation as to his investment intent with respect to
such shares prior to their issuance as set forth in Section 11 hereof.
The Company may register or qualify the shares covered by the Option for
sale pursuant to the Securities Act of 1933, as amended, at any time prior to or
after the exercise in whole or in part of the Option.
11. Method of Exercise of Option. (a) Subject to the terms and conditions
of this Agreement, the Option shall be exercisable by notice in the manner set
forth in Exhibit A hereto (the "Notice") and provision for payment to the
Company in accordance with the procedure prescribed herein. Each such Notice
shall:
(i) state the election to exercise the Option and the number of
Shares in respect of which it is being exercised;
(ii) contain a representation and agreement as to investment intent,
if required by counsel to the Company with respect to such
Shares, in form satisfactory to counsel for the Company;
(iii)be signed by the Director or the person or persons entitled to
exercise the Option and, if the Option is being exercised by any
person or persons other than the Director, be accompanied by
proof, satisfactory to counsel for the Company, of the right of
such person or persons to exercise the Option; and
(iv) be received by the Company on or before the date of the
expiration of this Option. In the event the date of expiration of
this Option falls on a day which is not a regular business day at
the Company's executive office in Englewood, Colorado, then such
written notice must be received at such office on or before the
last regular business day prior to such date of expiration.
(b) Payment of the purchase price of any shares of Common Stock, in respect
of which the Option shall be exercised, shall be made by the Director or such
person or persons at the place specified by the Company at the time the Notice
is delivered to the Company (i) by delivering to the Company a certified or bank
cashier's check payable to the order of the Company, (ii) by delivering to the
Company properly endorsed certificates of shares of Common Stock (or
certificates accompanied by an appropriate stock power) with signature
guaranties by a bank or trust company, (iii) by having withheld from the total
number of shares of Common Stock to be acquired upon the exercise of this Option
a specified number of such shares of Common Stock, (iv) by any form of
"cashless" exercise, or (v) by any combination of the above.
<PAGE>
(c) The Option shall be deemed to have been exercised with respect to any
particular shares of Common Stock if, and only if, the preceding provisions of
this Section 11 and the provisions of Section 12 hereof shall have been complied
with, in which event the Option shall be deemed to have been exercised on the
date the Notice of exercise of the Option was received by the Company. Anything
in this Agreement to the contrary notwithstanding, any notice of exercise given
pursuant to the provisions of this Section 11 shall be void and of no effect if
all the preceding provisions of this Section 11 and the provisions of Section 12
shall not have been complied with.
(d) The certificate or certificates for shares of Common Stock as to which
the Option shall be exercised will be registered in the name of the Director (or
in the name of the Director's estate or other beneficiary if the Option is
exercised after the Director's death), or if the Option is exercised by the
Director and if the Director so requests in the notice exercising the Option,
will be registered in the name of the Director and another person jointly, with
right of survivorship and will be delivered as soon as practical after the date
the Notice (and full payment) is received by the Company, but only upon
compliance with all of the provisions of this Agreement.
(e) If the Director fails to accept delivery of and pay for all or any part
of the number of Shares specified in such Notice upon tender or delivery
thereof, his right to exercise the Option with respect to such undelivered
Shares may be terminated in the sole discretion of the Board of Directors of the
Company. The Option may be exercised only with respect to full Shares.
(f) The Company shall not be required to issue or deliver any certificate
or certificates for shares of its Common Stock purchased upon the exercise of
any part of this Option prior to the payment to the Company, upon its demand, of
any amount requested by the Company for the purpose of satisfying its liability,
if any, to withhold state or local income or earnings tax or any other
applicable tax or assessment (plus interest or penalties thereon, if any, caused
by a delay in making such payment) incurred by reason of the exercise of this
Option or the transfer of shares thereupon. Such payment shall be made by the
Director in cash or, with the consent of the Company, by tendering to the
Company shares of Common Stock equal in value to the amount of the required
withholding. In the alternative, the Company may, at its option, satisfy such
withholding requirements by withholding from the shares of Common Stock to be
delivered to the Director pursuant to an exercise of this Option a number of
shares of Common Stock equal in value to the amount of the required withholding.
12. Approval of Counsel. The exercise of the Option and the issuance and
delivery of shares of Common Stock pursuant thereto shall be subject to approval
by the Company's counsel of all legal matters in connection therewith,
including, but not limited to, compliance with the requirements of the
Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, and the requirements of any
stock exchange upon which the Common Stock may then be listed.
<PAGE>
13. Resale of Common Stock. (a) If so requested by the
Company, upon any sale or transfer of the Common Stock purchased upon exercise
of the Option, the Director shall deliver to the Company an opinion of counsel
satisfactory to the Company to the effect that either (i) the Common Stock to be
sold or transferred has been registered under the Securities Act of 1933, as
amended, and that there is in effect a current prospectus meeting the
requirements of Section 10(a) of said Act which is being or will be delivered to
the purchaser or transferee at or prior to the time of delivery of the
certificates evidencing the Common Stock to be sold or transferred, or (ii) such
Common Stock may then be sold without violating Section 5 of said Act.
(b) The Common Stock issued upon exercise of the Option shall bear
the following legend if required by counsel for the Company:
THE SHARES EVIDENCED BY THIS CERTIFICATE MAY NOT BE SOLD,
TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF
UNLESS THEY HAVE FIRST BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR UNLESS, IN THE OPINION OF COUNSEL
FOR THE COMPANY, SUCH REGISTRATION IS NOT REQUIRED.
14. Reservation of Shares. To the extent shares of Common Stock are not
readily tradable on an established securities market, the Company shall at all
times during the term of the Option reserve and keep available such number of
shares of the class of stock then subject to the Option as will be sufficient to
satisfy the requirements of this Agreement.
15. Limitation of Action. The Director and the Company each acknowledges
that every right of action accruing to him or it, as the case may be, and
arising out of or in connection with this Agreement against the Company or a
Parent or Subsidiary, on the one hand, or against the Director, on the other
hand, shall, irrespective of the place where an action may be brought, cease and
be barred by the expiration of three years from the date of the act or omission
in respect of which such right of action arises.
16. Notices. Each notice relating to this Agreement shall be in writing and
delivered in person or by certified mail to the proper address. All notices to
the Company or the Committee shall be addressed to them at 9605 East Maroon
Circle, P.O. Box 6742, Englewood, Colorado 80155-6742, Attn: Secretary. All
notices to the Director shall be addressed to the Director or such other person
or persons at the Director's address above specified. Anyone to whom a notice
may be given under this Agreement may designate a new address by notice to that
effect.
17. Benefits of Agreement. This Agreement shall inure to the benefit of and
be binding upon each successor and assign of the Company. All obligations
imposed upon the Director and all rights granted to the Company under this
Agreement shall be binding upon
<PAGE>
the Director's heirs, legal representatives and successors.
18. Severability. In the event that any one or more provisions of this
Agreement shall be deemed to be illegal or unenforceable, such illegality or
unenforceability shall not affect the validity and enforceability of the
remaining legal and enforceable provisions hereof, which shall be construed as
if such illegal or unenforceable provision or provisions had not been inserted.
19. Governing Law. This Agreement will be construed and governed in
accordance with the laws of Delaware.
20. Directorship. Nothing contained in this Agreement shall be construed as
(a) a right of the Director to be continued as a director of the Company or any
Parent or Subsidiary, or (b) as a limitation of the right of the Company or any
Parent or Subsidiary to remove the Director at any time, with or without cause.
21. Definitions. Unless otherwise defined herein, all capitalized terms
shall have the same definitions as set forth under the Plan.
22. Incorporation of Terms of Plan. This agreement shall be interpreted
under, and subject to, all of the terms and provisions of the Plan, which are
incorporated herein by reference.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Agreement to
be executed in its name by its President or one of its Vice Presidents and its
corporate seal to be hereunto affixed and attested by its Secretary or one of
its Assistant Secretaries and the Director has hereunto set his hand all as of
the date, month and year first above written.
ICG COMMUNICATIONS, INC.
By:________________________________
Name:
Title:
-----------------------------------
[Name of Director]
-----------------------------------
Social Security Number
ATTEST:
- -------------------------
Secretary
<PAGE>
EXHIBIT A
NON-QUALIFIED STOCK OPTION EXERCISE FORM
[DATE]
ICG Communications, Inc.
9605 Maroon Circle
P.O. Box 6742
Englewood, Colorado 80155-6742
Dear Sirs:
Pursuant to the provisions of the Non-Qualified Stock Option
Agreement dated October 1, 1996, whereby you have granted to me a non-qualified
stock option to purchase 5,000 shares of Common Stock of ICG Communications,
Inc. (the "Company"), I hereby notify you that I elect to exercise my option to
purchase ________________ of the shares covered by such option at the price
specified therein. In full payment of the price for the shares being purchased
hereby, I am delivering to you herewith (a) a certified or bank cashier's check
payable to the order of the Company in the amount of $____________, or (b) a
certificate or certificates for [ ] shares of Common Stock of the Company, and
which have a fair market value as of the date hereof of $___________, and a
certified or bank cashier's check, payable to the order of the Company, in the
amount of $________________. Any such stock certificate or certificates are
endorsed, or accompanied by an appropriate stock power, to the order of the
Company, with my signature guaranteed by a bank or trust company or by a member
firm of the New York Stock Exchange. [I hereby acknowledge that I am purchasing
these shares for investment purposes only and not for resale.]
Very truly yours,
------------------------------
[Name]
[Address]
(For notices, reports, dividend checks
and other communications to stockholders.)
<PAGE>
OPTION NO. 96-DIRECTOR-[ ]
October 1, 1996 Grant
ICG COMMUNICATIONS, INC.
1996 Stock Option Plan
NON-QUALIFIED STOCK OPTION
(for Directors)
Granted To
----------------------------
Optionee
5,000
Number of Shares Price per Share
DATE GRANTED: October 1, 1996 EXPIRATION DATE: September 30, 2005
----------------- -------------------
- --------------------------------------------------------------------------------
Exhibit 5.1
- --------------------------------------------------------------------------------
[Sherman & Howard L.L.C. letterhead]
April 25, 1997
ICG Communications, Inc.
9605 East Maroon Circle
P.O. Box 6742
Englewood, Colorado 80155-6742
Attn: William J. Laggett, Chairman of the Board of Directors
Dear Mr. Laggett:
We have acted as special counsel for ICG Communications, Inc.
(the "Company") in connection with the preparation, execution and filing of a
Registration Statement under the Securities Act of 1933 on Form S-8 relating to
the registration of 6,253,600 shares of ICG Communications, Inc. Common Stock,
$.01 par value ("Common Stock"), (i) which may be purchased by directors,
officers and employees pursuant to the Incentive Stock Option Plan #2; the
Incentive Stock Option Plan #3; and the 1994 Employee Stock Option Plan; 1996
Stock Option Plan; and (ii) which may be purchased for the accounts of
participants in the ICG Communications, Inc. Employee Savings Plan and the ICG
Communications, Inc. 401(k) Wraparound Deferred Compensation Plan (the "Plans").
In connection with the opinion expressed below, we have made such factual
inquiries and have examined or caused to be examined such questions of law as we
have considered necessary or appropriate for the purpose of such opinion. On the
basis of such inquiries or examinations, it is our opinion that any newly issued
shares of Common Stock purchased from the Company pursuant to the Plans, when
paid for as contemplated by the Plans, will be duly authorized, validly issued,
fully paid and nonassessable.
We consent to the filing of this opinion as an exhibit to the Registration
Statement referred to above.
Very truly yours,
/s/ Sherman & Howard L.L.C.
Sherman & Howard L.L.C.
<PAGE>
Consent of Independent Auditors
The Board of Directors
ICG Communications, Inc.:
We consent to incorporation by reference in the registration statement on Form
S-8 of ICG Communications, Inc., of our reports relating to the consolidated
balance sheets of ICG Communications, Inc. and subsidiaries as of September 30,
1995 and 1996 and December 31, 1996, and the related consolidated statements of
operations, stockholders' equity (deficit), and cash flows for each of the years
in the three-year period ended September 30, 1996, and the three-month period
ended December 31, 1996, and the related financial statement schedule.
Our report refers to a change during the year ended September 30, 1996 in the
Company's method of accounting for long-term telecom services contracts.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Denver, Colorado
April 25, 1997
