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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------
FORM 10-SB
AMENDMENT NO. 1
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
INTERCONEXUS.COM, INC.
(Name of Small Business Issuer in Its Charter)
DELAWARE 52-2225697
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
2651 WARRENVILLE ROAD, SUITE 560, 60515
DOWNERS GROVE, ILLINOIS
(Address of Principal Executive Offices) (Zip Code)
(630) 874-5500
Issuer's Telephone Number
Securities to be registered pursuant to Section 12(b) of the Act:
None
(Title of Class)
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock, $0.0001 par value per share
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PART I
The Issuer has elected to follow Form 10-SB, Disclosure Alternative 2.
ITEM 6. DESCRIPTION OF BUSINESS.
GENERAL.
InterConexus.com, Inc., a Delaware corporation (the "Company"),
proposes to engage in electronic commerce ("e-commerce") by developing an
on-line business-to-business trading exchange for the global electronic
interconnect industry.
The Company was incorporated in March, 2000 by Capri Corp., a Minnesota
corporation ("Capri"). Capri is engaged in developing computer software that
records, organizes and provides access to real-time integrated manufacturing
information for use by printed circuit board (PCB) manufacturers. Capri develops
and licenses software under the trademarks Paradigm(R) and Paradeim(R) which
provides real time access to information at the PCB manufacturing plant level,
such as engineering information, production scheduling, quality control reports
and levels and types of inventory being produced. Capri also provides related
technical support and user training and distributes certain hardware and third
party software that may be used with Paradigm(R). Capri, a reporting company
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is
currently the sole shareholder of the Company. On May 18, 2000, Capri declared a
distribution of all of the issued and outstanding Company common stock ("Common
Stock") to Capri shareholders of record as of May 30, 2000 (the "Record Date"),
payable on June 1, 2000 on the basis of one share of Company Common Stock for
each Capri share held of record on the Record Date ("Spin-Off"). The objectives
of the Spin-Off are:
- - to focus management of the Company on the proposed core business of the
Company without regard to the corporate objectives and policies of Capri;
- - to allow the Company to develop its proposed business independently of
Capri to appeal to an industry-wide customer base;
- - to improve the likelihood that the Company, as a separate Exchange Act
reporting company, will have access to capital;
- - to improve the ability of the capital markets to separately follow and
analyze the operating performance of the Company and Capri;
- - to offer more attractive and appropriate incentives for the retention and
motivation of necessary personnel at the Company; and
- - to offer the Company greater flexibility to facilitate its growth through
acquisitions and/or investments.
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The Company's principal executive offices are located at 2651
Warrenville Road, Suite 560, Downers Grove, Illinois 60515; it's telephone
number is (630) 874-5500, and its web site address is www.interconexus.com.
BUSINESS PLAN OF THE COMPANY.
The Company intends to develop an e-commerce business-to-business
trading exchange (the "Trade Exchange") which would make up an electronic
trading community within the global electronic interconnect industry which
comprises the areas of integrated circuits, semi-conductors, contract assembly,
printed circuit boards and electronic manufacturing service providers. The Trade
Exchange would establish a common trading hub between suppliers, customers and
manufacturers in the global electronic interconnect industry. The Trade Exchange
would enable multi-buyer and multi-seller interaction, would address end-to-end
transactions and it would enable the global electronic interconnect industry
community to share common information and knowledge. The primary role of the
Trade Exchange will be to connect buyers and sellers within the global
electronic interconnect industry.
RELATIONSHIP BETWEEN THE COMPANY AND CAPRI AFTER THE SPIN-OFF.
For the purpose of governing certain ongoing relationships between the
Company and Capri after the Spin-Off, the Company and Cimnet Systems, Inc.,
Capri's wholly-owned operating subsidiary ("Cimnet"), have entered into various
agreements and adopted certain policies with respect to the following:
- - Services Agreement. The Company and Cimnet have entered into a Services
Agreement whereby Cimnet provides certain services to the Company on an
as-needed basis. The fees for such services will be based on a rate
designed to reflect Cimnet's cost of providing such services, including
reimbursement of certain direct out-of-pocket expenses. The Company is free
to procure such services from outside vendors or to develop an in-house
capability in order to provide such services internally. The services
provided to the Company by Cimnet pursuant to such agreement include
accounting services, computer services, insurance coverage, payroll
processing services and management of employee benefits programs, or any
other similar services that the Company may require.
- - Office Space. The Company currently intends to share office space with
Cimnet. Cimnet intends to allocate to the Company its pro rata share of
rent, common area maintenance charges and other costs and expenses under
Cimnet's lease for its office space based upon the square footage of the
shared office space occupied by the Company.
- - Software License. The Company and Cimnet may enter into a license agreement
pursuant to which Cimnet will grant a license to the Company for certain
components of Paradigm(R), Cimnet's software application. It is expected
that the fees payable by the Company pursuant to this license agreement
will be at least the same fees generally required under Cimnet's typical
software license with unrelated third-party customers for the same
software.
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INDUSTRY BACKGROUND.
Growth of the Internet and the World Wide Web
The Internet and the World Wide Web ("Web") are experiencing dramatic
growth in terms of the number of Web users. The growth of the number of Web
users and the amount of time spent on the Web is being driven by the increasing
importance of the Internet as a communications medium and an information
resource in the sales and distribution channel.
Growth of On-Line E-Commerce
The Internet is dramatically affecting the methods by which consumers
and businesses are buying and selling goods and services. E-commerce offers the
opportunity for businesses to establish new competitive standards by expanding
distribution channels, integrating internal and external processes and offering
a cost-effective method of providing products and services. The Internet
provides on-line businesses with the ability to reach a global audience and to
operate with a minimal infrastructure, reducing overhead and providing greater
economies of scale, while providing customers and businesses with a broad
selection, increased pricing power and unparalleled convenience. As a result, a
growing number of parties are transacting business on the Web.
The Electronic Interconnect Industry On the Internet
The Company has identified a need in the world wide electronic
interconnect community for Internet-based services such as the Trade Exchange
which can provide services and connect businesses involved in the electronic
interconnect industry at an anticipated economical cost. The traditional methods
of information delivery and communications between businesses involved in the
electronic interconnect industry, including trade magazines, telephone and trade
conferences, contain inherent inefficiencies such as:
- trade publications and print media are costly and offer a limited
circulation;
- expansion of businesses beyond traditional boundaries is expensive
due to the high cost of marketing, travel and promotional
expenses; and
- language barriers limit the ability of businesses to communicate.
The Internet provides a medium for businesses around the world to communicate
and enter into business transactions.
COMPETITION.
Barriers to entry into competition with the Company's proposed Trade
Exchange are low. Presently, the Company believes that PCB.007.com,
Verticalnet.com, Agilesoft.com, TheSupply.com. WebQuote.com and FreeMarkets.com
are either engaged in, contemplating or actively pursuing the establishment of a
business-to-business e-commerce service for the electronic interconnect
industry. These companies are larger, more experienced and better financed than
the Company. In addition, many general business-to-business e-commerce
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companies are larger and better financed than the Company. There are minimal
barriers to such companies developing and providing a business-to-business
e-commerce exchange for the electronic interconnect industry which would compete
directly with that of the Company. See "Risk Factors".
REVENUE AND WORKING CAPITAL.
Revenue
The Company intends to derive revenues from the Trade Exchange by
charging a transaction fee equal to a percentage of the value of the transaction
consummated between buyer and seller via the Trade Exchange. The specifics of
such transaction based fee has not yet been established. In addition, the
Company may also derive revenues from the Trade Exchange in other ways, such as
selling advertising space on the Trade Exchange.
Working Capital
The Company currently has no operations and does not expect to generate
any revenues from operations prior to the time the Trade Exchange becomes
operational. The Company intends to fund its development through investments
from strategic partners, funds from investors, as well as funds borrowed from
Capri, if necessary. Although the Company has had informal contacts with certain
parties regarding investments in the Company, and has also discussed the
possibility of borrowing operating funds from Capri, no agreements have been
reached with respect to such investments or borrowings. See "Risk Factors".
EMPLOYEES.
The Company currently has no employees.
CUSTOMERS.
The Company currently has no customers. The Trade Exchange's customer
base is expected to include manufacturers, customers and suppliers within the
global electronic interconnect industry.
MARKETING.
The Company intends to increase the visibility and brand recognition of
its Trade Exchange through a variety of marketing and promotional techniques
such as direct mailings, advertisements in trade publications and attendance at
trade shows. The Company may also pursue co-marketing arrangements with other
websites on the Internet through cross-linking.
PATENTS, TRADEMARKS AND LICENSES.
The Company's performance and ability to compete will be dependent to a
significant degree on its ability to develop and protect its proprietary
technology. The Company intends to
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rely on a combination of trademark, copyright and trade secret laws, as well as
confidentiality agreements and non-compete agreements executed by employees and
consultants in order to establish and protect its proprietary rights as they are
developed or acquired. The Company is the owner of the "www.interconexus.com"
domain name.
RISK FACTORS. The Common Stock of the Company involves a high degree of
risk and is intended for long term investment. The following specific risk
factors should be read in light of the more complete discussion elsewhere in
this Registration Statement.
Possible Conflicts of Interest and Related Party Transactions.
The directors and officers of the Company are also the directors and
officers of Capri and/or Cimnet. Accordingly, conflicts of interest could arise
for such persons. In addition, as part of its ongoing business and operations,
the Company will engage in certain transactions with Capri. Due to the
relationships between the Company and Capri, the terms of such transactions may
not necessarily be effectuated through arms-length negotiations. However, all
such transactions will be subject to review by the Board of Directors of the
Company.
Mehul J. Dave, the Chairman of the Board, President and Chief Executive
Officer of the Company, holds the same positions at Capri. Mr. Dave intends to
divide his time between the Company and Capri, and therefore will be unable to
devote his attention solely to the operations of the Company.
Restrictions On Transfer.
Upon the Spin-Off the Common Stock will not be transferable until the
first to occur of the following: (i) the second anniversary of the Spin-Off;
(ii) the consummation of an initial public offering of the Common Stock
registered under the Securities Act of 1933, as amended; or (iii) the Board of
Directors of the Company determines, in its sole discretion, that the business
of the Company has developed to support a trading market. Notwithstanding the
foregoing, the stockholders of the Common Stock shall not be restricted in any
way from transferring any shares of Common Stock (i) in connection with the
Spin-Off, or (ii) by will, intestacy laws or the laws of descent or survivorship
or by operation of law.
The Company has No Operating History And May Experience Risks
Encountered By Early-Stage Companies.
The Company was formed in March 2000 and therefore has no operating
history. The Company's business and prospects must be considered in light of the
risks, expenses and difficulties that companies encounter in the early stages of
development, particularly companies in new and rapidly evolving markets like the
Internet and e-commerce. These risks include the Company's ability to:
- develop the Trade Exchange;
- develop its technology and customer service;
- manage its growth effectively;
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- anticipate and adapt to the rapid changes that characterize
the market the Company expects to serve;
- expand its sales and marketing efforts to build brand
recognition; and
- continue to identify, attract, retain and motivate qualified
personnel.
The Revenue And Profit Potential Of the Company's Business Model Is
Unproven.
The Company's business model is new and its ability to generate revenue
or profits is unproven.
The Company's Financial Results May Fluctuate And May Be Difficult To
Forecast.
The Company's quarterly revenues, expenses and operating results may be
unpredictable. The Company expects that its operating results will fluctuate in
the future due to a number of factors, some of which are beyond its control.
These factors include:
- its ability to develop the Trade Exchange, and the costs of
such development;
- its ability to attract businesses and customers;
- its ability to control its gross margins;
- consumer confidence in encrypted transactions in the Internet
environment;
- the amount and timing of costs relating to expansion of its
operations;
- technical difficulties consumers and businesses might
encounter in using the Trade Exchange;
- delays in processing orders as a result of computer systems
failures, Internet "brown-outs" or problems with completing,
processing and securing financial transactions through the
Internet; and
- general economic conditions and economic conditions specific
to the Internet and e-commerce.
Additional Capital.
The Company must raise additional capital in the near term to continue
its business plan. The Company will attempt to raise additional capital but
there are no guarantees that it will be able to raise sufficient capital on a
timely basis and on reasonable terms. Additional financing could involve
dilution to the interests of the Company's then-existing stockholders.
The Company Will Face Intense Competition In The E-Commerce Market.
The e-commerce market is new, rapidly evolving and intensely
competitive, and the Company expects competition to intensify in the future.
Barriers to entry are minimal, and competitors presently exist and more may
develop and offer similar services in the future. The Company's business could
be severely harmed if it is not able to compete successfully against current or
future competitors. Although there is no current dominant e-commerce provider in
the Company's expected markets, additional companies may offer competing
e-commerce solutions in the future. In addition, the Company's customers may
become competitors in the future.
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The Company Will Rely On Third Parties To Maintain its Critical Systems
And, If These Third Parties Fail To Adequately Perform Their Services, The
Company Could Experience Disruptions In Its Operations.
The Company will rely on a number of third parties for Internet and
telecommunications access, delivery services and financial transaction
processing. The Company will have limited control over these third parties and
no long-term relationships with any of them. From time to time, the Company
expects to experience temporary interruptions in its Web site connection and
telecommunications access. Slow Internet transmissions or prolonged
interruptions in its Web site connection or telecommunications access would
materially harm its business.
The Company May Not Be Able To Sustain Or Grow Its Business Unless It
Keeps Up With Rapid Technological Changes.
The Internet and electronic commerce industries are characterized by:
- rapidly changing technology;
- changes in consumer demands;
- frequent introductions of new services or products that embody
new technologies; and
- evolving industry standards and practices that could render
the Company's Web sites and proprietary technologies obsolete.
The Company's future performance will depend, in part, on its ability
to license or acquire leading technologies, enhance its existing services and
respond to technological advances and emerging industry standards and practices
on a timely and cost-effective basis. Developing Web site and other proprietary
technology involves significant technical and business risks. The Company also
cannot offer assurance that it will be able to successfully use new technologies
or adapt its Web sites and proprietary technology to emerging industry
standards. The Company may not be able to remain competitive or sustain growth
if it does not adapt to changing market conditions or customer requirements.
If The Company Encounters System Failure, Service To Its Customers
Could Be Delayed Or Interrupted. Service Delays Or Interruptions Could Severely
Harm Its Business And Result In A Loss Of Customers.
The Company's ability to successfully maintain e-commerce Web sites and
provide acceptable levels of customer service largely depends on the efficient
and uninterrupted operation of its computer and communications hardware and
network systems. Any interruptions could severely harm the Company's business
and result in a loss of customers.
Dependence On Key Personnel.
The Company's future performance depends substantially on the continued
service of Mehul J. Dave, the Chairman, President and Chief Executive Officer of
the Company. Mr. Dave
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intends to divide his time between Capri and the Company, and therefore will be
unable to focus exclusively on the operations of the Company.
Business Will Suffer If The Company Does Not Attract And Retain
Additional Highly Skilled Personnel.
The Company's future success will depend upon its ability to hire,
train and retain highly skilled personnel. Competition for quality personnel is
intense. The Company cannot be sure that it will be successful in hiring,
assimilating or retaining the necessary personnel, and its failure to do so
could adversely affect its business and financial condition.
The Company May Not Be Able To Successfully Protect Its Proprietary
Rights.
The Company's ability to compete effectively will depend on its ability
to maintain the proprietary nature of its services and technologies, including
its proprietary software. The Company intends to rely on a combination of
patents, trade secrets, copyright laws, non-disclosure, and other contractual
agreements to protect its rights in its technological know-how and proprietary
services. The Company also intends to depend upon confidentiality agreements
with its officers, directors, employees and consultants to maintain the
proprietary nature of its technology. These measures may not afford the Company
sufficient or complete protection, and others may independently develop know-how
and services similar to the Company's, otherwise avoid its confidentiality
agreements, or produce patents or copyrights that would materially adversely
affect the Company's business, prospects, financial condition and results of
operations.
The Company's Success Depends On The Internet's Ability To Accommodate
Growth In E-Commerce.
The use of the Internet for retrieving, sharing and transferring
information among businesses, buyers, suppliers and partners has only recently
begun to develop. If the Internet were not able to accommodate growth in
e-commerce, the Company's business would suffer. The recent growth in the use of
the Internet has caused frequent periods of performance degradation. The
Company's ability to sustain and improve its services is limited, in part, by
the speed and reliability of the networks operated by third parties.
Consequently, the emergence and growth of the market for its services is
dependent on improvements being made to the Internet infrastructure to alleviate
overloading and congestion.
A Lack Of Development Of The E-Commerce Market Would Negatively Affect
The Company.
If the e-commerce market does not grow or grows more slowly than
expected, the Company's business will suffer. The possible slow adoption of the
Internet as a means of commerce by businesses may harm the Company's prospects.
A number of factors could prevent the acceptance and growth of e-commerce,
including the following:
- e-commerce is at an early stage and buyers may be unwilling to
shift their traditional purchasing to online purchasing;
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- businesses may not be able to implement e-commerce
applications on these networks;
- increased government regulation or taxation may adversely
affect the viability of e-commerce;
- insufficient availability of telecommunication services or
changes in telecommunication services may result in slower
response times; and
- adverse publicity and consumer concern about the reliability,
cost, ease of access, quality of services, capacity,
performance and security of e-commerce transactions could
discourage its acceptance and growth.
Even if the Internet is widely adopted as a means of commerce, the
adoption of the Company's networks, particularly by companies that have
historically relied on more traditional means, will require broad acceptance of
the new approach. In addition, companies that have already invested substantial
resources in traditional methods of procurement, or in-house e-commerce
solutions, may be reluctant to adopt our e-commerce solutions.
Security Risks Of Electronic Commerce May Deter Use Of The Company's
Products And Services.
A fundamental requirement to conduct business-to-business e-commerce is
the secure transmission of information over public networks. If customers are
not confident in the security of e-commerce, they may not effect transactions on
the Trade Exchange, which would severely harm its business. The Company cannot
be certain that advances in computer capabilities, new discoveries in the field
of cryptography, or other developments will not result in the compromise or
breach of the algorithms the Company will use to protect content and
transactions via e-commerce. Anyone who is able to circumvent the Company's
security measures could misappropriate proprietary, confidential user
information, place false orders or cause interruptions in the Company's
operations. The Company may be required to incur significant costs to protect
against security breaches or to alleviate problems caused by breaches. Further,
a well-publicized compromise of security could deter people from using the
Internet to conduct transactions that involve transmitting confidential
information.
Increasing Governmental Regulation Of The Internet Could Adversely
Affect The Company's Business.
The Company is currently not regulated by any government agency, other
than regulations applicable to businesses generally and laws or regulations
directly applicable to Internet commerce. However, due to the increasing
popularity and use of the Internet, it is possible that a number of laws and
regulations may be adopted with respect to the Internet, covering issues such as
user privacy, pricing, sales tax, and characteristics and quality of products
and services. Furthermore, the growth and development of Internet commerce may
prompt calls for more stringent consumer protection laws that may impose
additional burdens on companies conducting business over the Internet. New laws
or regulations may decrease the growth of the Internet, which, in turn, could
decrease the demand for the Company's services and increase its cost of doing
business. The applicability to the Internet of existing laws in
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various jurisdictions governing issues such as property ownership, auction
regulation, sales tax, libel and personal privacy is uncertain and may take
years to resolve.
The tax treatment of the Internet and electronic commerce is currently
unsettled. A number of proposals have been made at the federal, state and local
level and by some foreign governments that could impose taxes on the sale of
goods and services and other Internet activities. In October 1998, the Internet
Tax Freedom Act was signed into law, placing a three-year moratorium on new
state and local taxes on Internet commerce. However, it is possible that future
laws imposing taxes or other regulations on commerce over the Internet could
substantially impair the growth of electronic commerce and as a result have a
negative effect on the Company's business.
In addition, because the Company's service will be available over the
Internet in multiple states and countries, the Company could be required to
qualify to do business as a foreign corporation in each state or country in
which its services are available. The Company is qualified to do business in
only two states, and its failure to qualify as a foreign corporation in a
jurisdiction where it is required to do so could subject it to taxes and
penalties for the failure to qualify. Any new legislation or regulation, or the
application of laws or regulations from jurisdictions whose laws do not
currently apply to the Company's business, could have a material adverse effect
on its business.
ITEM 7. DESCRIPTION OF PROPERTY.
The Company is headquartered at 2651 Warrenville Road, Suite 560,
Downers Grove, Illinois. This location is leased by Cimnet, which permits the
Company to share its office space. See "Relationships between the Company and
Capri after the Spin-Off."
ITEM 8. DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES.
Below are the names, ages, positions with the Company and business
experience for the last five years of the executive officers and directors of
the Company.
<TABLE>
<CAPTION>
NAME POSITION AGE
- ---- -------- ---
<S> <C> <C>
Mehul J. Dave President and Chairman of the Board of Directors 44
P. Balasubramanian Secretary, Treasurer and Director 43
Robert W. Heller Director 53
Thomas Mueller Director 58
Jason W. Levin Director 41
Utpal J. Dave Director 35
David L. Harris Director 57
</TABLE>
MEHUL J. DAVE, Director, Chairman of the Board and President of the
Company. Director, Chairman of the Board and President of Capri, from 1992 to
present and President and Chief Executive Officer of Cimnet from 1988 to
present. Mr. Dave holds a Masters Degree in Environmental Systems from Governors
State University, a Bachelors Degree in Mechanical
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Engineering from Illinois Institute of Technology, and has completed coursework
towards a Ph.D. in Space Physics at the University of Michigan. Mr. Dave is
responsible for the overall operation of the Company.
P. BALASUBRAMANIAN, Director, Secretary and Treasurer of the Company.
Director, Executive Vice President, Secretary and Treasurer of Capri, from 1992
to present; Vice President of Software Engineering of Cimnet, from 1988 to
present. Mr. Balasubramanian holds a Masters Degree in Computer Science from
Illinois Institute of Technology and a Bachelors Degree in Mechanical
Engineering from Annamalai University.
ROBERT W. HELLER, Director of the Company. Director of Capri, from
September, 1996 to present. Mr. Heller is currently an independent consultant.
From 1998 to 1999, Mr. Heller was Vice President of Operations at Fieldworks,
Inc. From 1996 to 1997, Mr. Heller was Chief Executive Officer of MiTech R&D
Inc., and was Chief Executive Officer of Advance Circuits Inc. from 1994 to
1995. Mr. Heller holds a Masters Degree in Industrial Engineering from North
Dakota State University and a Bachelors Degree in Industrial Administration from
Purdue University.
THOMAS MUELLER, Director of the Company. Director of Capri, from 1997
to present. Mr. Mueller has been Vice President of Finance since 1995 of
Help/Systems, a manufacturer of operations automation software for the IBM
AS/400 computer. Mr. Mueller is a Certified Public Accountant and a member of
the American Institute of Certified Public Accountants and Minnesota Society of
Certified Public Accountants. Mr. Mueller holds a Bachelors Degree in Accounting
from the University of Minnesota.
JASON W. LEVIN, Director of the Company. Director of Capri, from 1997
to present. Mr. Levin has been a partner in the law firm of Piper Marbury
Rudnick & Wolfe, counsel to the Company, from 1998 to present and a partner in
the law firm of Fagel & Haber, from 1989 to 1998. Mr. Levin is a director of
Strube Celery and Vegetable Company, a corporation engaged in the wholesale
distribution of fresh fruits and vegetables in the Midwestern United States, and
a member of the Board of Managers of the Logan Square Club of the Boys and Girls
Club of Chicago. Mr. Levin holds a Bachelor of Science Degree in Finance and a
Juris Doctor degree from Indiana University.
UTPAL J. DAVE, Director of the Company, from May 18, 2000 to present;
Chief Operating Officer of the Company, from May 23, 2000 to present. From 1997
to 2000, Mr. Dave worked as a Senior Manager with Andersen Consulting's Strategy
Practice. From 1995 to 1997, Mr. Dave was a management consultant with Booz
Allen & Hamilton. Mr. Dave holds a MBA from Kellogg / Northwestern University, a
Masters Degree in Electrical Engineering from the University of Illinois and a
Bachelors Degree in Computer Engineering from the University of Illinois.
DAVID L. HARRIS, Director of the Company, from May 18, 2000 to present.
Mr. Harris is Vice President-Marketing, Sales and Services of Cimnet. Mr. Harris
has been employed by Capri since 1998. From 1997 to 1998, Mr. Harris was a
principal and owner of DLH & Associates, a consulting firm to the semiconductor,
printed wire board and capital equipment
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industries. From 1995 to 1997, Mr. Harris was Vice President- Sales, Marketing
and Services of Semitool, Inc, a seller of capital equipment to the
semiconductor industry, and from 1983 to 1995, Mr. Harris was a General Manager
in WR Grace's photopolymer systems business. Mr. Harris holds a Bachelor's
Degree in Marketing and Economics from the University of Maryland and a
Certificate in Business Management from MIT's Greater Boston Executive Program.
Each of the Company's directors, were appointed to serve as directors
on March 23, 2000, except for Utpal J. Dave and David L. Harris who were
appointed to serve as directors on May 18, 2000, and each will hold office until
the next annual meeting of shareholders. No director has resigned since March
23, 2000 and no director has declined to stand for re-election in 2001. Each of
the Company's executive officers were elected on March 23, 2000, except for Paul
Dave who holds the position of Chief Operating Officer and was appointed to such
position effective May 23, 2000, and each will hold office until the next annual
board of directors meeting. The term of office of each director expires at each
annual meeting of shareholders and upon the election and qualification of his
successor. There are no arrangements with any director or officer regarding any
election or appointment to any office of the Company.
There are no family relationships between any director or executive
officer of the Company, except for Mehul Dave and Utpal J. Dave who are
brothers. No director, executive officer or significant employee of the Company,
during the prior five years, (i) has filed a petition under the Bankruptcy Act
or any State insolvency law or has had the same filed against him, or has had a
receiver, fiscal agent or similar officer appointed by a court for the business
or property of such person, or any partnership in which he was a general partner
at or within two years before the time of such filing, or any corporation or
business association of which he was an executive officer at or within two years
before the time of such filing; or (ii) has been convicted in a criminal
proceeding.
ITEM 9. REMUNERATION OF DIRECTORS AND OFFICERS.
The officers of the Company are not currently compensated by the
Company for their services and have not entered into any employment agreements
with the Company. The officers of the Company are currently employed by Cimnet.
The Company will reimburse Cimnet for the services of the officers. See
"Relationship between the Company and Capri after the Spin-Off." All directors
except each of Messrs. P. Dave and Harris receive stock options for agreeing to
serve as a director of the Company. Messrs. M. Dave, P. Dave, Balasubramanian
and Harris also received options in the Company as employees of Cimnet, and Mr.
Heller received options as a consultant to the Company.
ITEM 10. SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS.
(a) The following table sets forth information as to the anticipated
record ownership of the Company's Common Stock immediately subsequent to the
Spin-Off based on shares of Capri common stock held on March 24, 2000 by the (i)
officers and directors of the Company, (ii) the officers and directors as a
group and (iii) each person who owns more than 10% or more of the Company's
Common Stock.
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NAME OF OWNER(1) AMOUNT OWNED PERCENT OF CLASS
- ------------- ------------ ----------------
Mehul J. Dave 4,845,000 37.53
P. Balasubramanian 1,525,000 11.81
Robert W. Heller 382,000 2.96
Thomas Mueller 113,000 .88
Jason W. Levin 0 0
Utpal J. Dave 6,675 .05
David L. Harris 75,000 .58
All Officers and
Directors as a Group (5) 6,946,675 53.82
(1) The address of each of Messrs. M. Dave, Balasubramanian, Heller, Mueller,
Levin, U. Dave and Harris is 2651 Warrenville Road, Suite 560, Downers
Grove, Illinois.
(b) The following table sets forth information as to options, warrants and
other rights to purchase the Company's Common Stock by (i) the officers and
directors of the Company, and (ii) the officers and directors as a group.
AMOUNT OF COMMON
STOCK SUBJECT TO
OPTIONS, WARRANTS EXERCISE PRICE
NAME OF OWNER OR RIGHTS(1) PER SHARE
- ------------- ----------------- --------------
Mehul J. Dave 80,000 $0.01
P. Balasubramanian 55,000 $0.01
Robert W. Heller 80,000 $0.01
Thomas Mueller 30,000 $0.01
Jason W. Levin 30,000 $0.01
Utpal J. Dave 450,000 $0.01
David L. Harris 25,000 $0.01
All Officers and Directors as a
Group (5) 750,000
(1) All options have been issued in accordance with the Company's
2000 Stock Incentive Plan and are subject to a stock option
agreement with the Company. Each director, except Messrs. U.
Dave and Harris, has been granted 30,000 options for agreeing
to become a director that are vested and exercisable. The
other options vest from a period of one to four years from the
date of the grant of the options.
13
<PAGE> 15
ITEM 11. INTERESTS OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS.
Robert W. Heller, a director of the Company, is a paid consultant to
the Company. Jason W. Levin, a director of the Company, is a partner in the law
firm of Piper Marbury Rudnick & Wolfe, counsel to the Company. With the
exception of Mr. Heller's and Mr. Levin's indirect interests, the Company has
not engaged in any material transaction, and there is no presently proposed
transaction, in which any director, officer or principal security holder of the
Company, any nominee for election as a director of the Company, any director or
officer of any subsidiary of the Company, or any relative or spouse of any of
the foregoing, had or is anticipated to have a direct or indirect material
interest. See "Relationship between the Company and Capri after the Spin-Off."
ITEM 12. SECURITIES BEING REGISTERED.
The Company is currently authorized to issue Sixty Million (60,000,000)
shares of all classes of stock, of which Forty Million (40,000,000) shares are
of a class designated common stock, par value $.0001 per share and Twenty
Million (20,000,000) shares are of a class designated preferred stock, par value
$.001 per share (the "Preferred Stock"). The Preferred Stock may be issued in
one or more series, and the designations, powers, preferences and rights, and
the qualifications, limitations or restrictions thereof, including, without
limitation, the dividend rights, dividend rate, conversion rights, voting
rights, rights and terms of redemption (including sinking fund provisions),
redemption price or prices, and liquidation preferences for any unissued series,
and the number of shares constituting any such series and the designation
thereof, may be designated by the Board of Directors. There are presently no
shares of Preferred Stock issued and outstanding. The following sets forth
certain material terms of the Common Stock.
RESTRICTIONS ON TRANSFER. The Company's Amended and Restated
Certificate of Incorporation (the "Certificate") restricts the transfer of
Common Stock until the first to occur of the following: (i) the second
anniversary of the Spin-Off; (ii) the consummation of an initial public offering
of the Common Stock registered under the Securities Act of 1933, as amended; or
(iii) the Board of Directors of the Company determines, in its sole discretion,
that the business of the Company has developed to support a trading market.
Notwithstanding the foregoing, the stockholders of the Company Common Stock
shall not be restricted in any way from transferring any shares of Common Stock
(i) in connection with the Spin-Off, or (ii) by will, intestacy laws or the laws
of descent or survivorship or by operation of law. Due to these transfer
restrictions, there will be no public market for the Company's Common Stock
following the Spin-Off. In addition, even after these transfer restrictions
expire, there can be no assurance that a public market for the Company's Common
Stock will develop or, if such market does develop, that it will be sustained.
VOTING RIGHTS. The holder of a share of Common Stock is entitled to one
vote for all purposes. Cumulative voting is not permitted in the election of
directors. Accordingly, the holders of more than 50% of all of the outstanding
shares of Common Stock may elect all of the directors. Significant corporate
transactions such as amendments to the Certificate, mergers, sale of assets and
dissolution or liquidation of the Company requires the approval by the
affirmative vote of the holders of at least a majority of the outstanding shares
of Common Stock. Other matters
14
<PAGE> 16
to be voted upon by the holders of Common Stock normally require the affirmative
vote of a majority of the shares present at the particular shareholders meeting.
DIVIDEND RIGHTS. The holder of a share of Common Stock is entitled to
participate pro rata in dividends paid by the Company, which may be declared,
from time to time, by the Board of Directors out of funds of the Company legally
available for the payment of dividends. The declaration in the future of any
cash or stock dividends will be at the discretion of the Board of Directors and
will depend upon the earnings, capital requirements, and financial position of
the Company, general economic conditions, and other pertinent factors. There is
no assurance that any dividends will be paid in the near future as the Company
has no present plans to pay dividends.
LIQUIDATION RIGHTS. Each share of Common Stock shares pro rata with
each other share of Common Stock in any distribution in any liquidation of the
Company. Such rights will be subject to the prior claims of creditors of the
Company.
PREEMPTIVE RIGHTS, CONVERSION RIGHTS, REDEMPTION PROVISIONS, SINKING
FUND PROVISION AND LIABILITY TO FURTHER CALLS AND ASSESSMENTS. There are no
preemptive or conversion rights, redemption provisions, or sinking fund
provisions relating to the Common Stock. All currently outstanding shares of
Common Stock are fully paid and nonassessable. The rights of holders of the
existing class of Common Stock may in the future become subject to prior and
superior rights and preferences in the event the Board of Directors issues one
or more series of Preferred Stock or establishes one or more other classes or
series of capital stock of the Company. The Board of Directors has no present
plan to establish any such other class or series.
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND OTHER SHAREHOLDER MATTERS.
Prior to the consummation of the Spin-Off, there has been no public
market for the Company's Common Stock. In addition, the stockholders of Company
Common Stock will be unable to transfer such stock except in specific
circumstances, as described in Item 12. Even after these transfer restrictions
expire, there can be no assurance that a public market for the Company's Common
Stock will develop or, if such market does develop, that it will be sustained.
ITEM 2. LEGAL PROCEEDINGS.
None.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
None.
15
<PAGE> 17
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
In connection with the formation of the Company, 1,000 shares of the
Company's Common Stock were issued to Capri Corp. for $10,000. Prior to the
Spin-Off, Capri will purchase additional shares of the Company's Common Stock so
that it will hold that number of shares of the Company's Common Stock equal to
that number of shares of Capri common stock outstanding as of the Record Date.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law permits
indemnification of officers and directors of domestic or foreign corporations
under certain circumstances and subject to certain limitations. The Company's
Certificate of Incorporation and Bylaws contain provisions for indemnification
of the Company's directors, officers, and employees consistent with the
provisions of Section 145 of the Delaware General Corporation Law. The Company
currently has director and officer liability insurance.
16
<PAGE> 18
PART F/S
The following financial statements of the Company are included herein:
(a) Independent Auditor's Report
(b) Balance Sheet
(c) Statement of Stockholder's Equity
(d) Statement of Cash Flows
(e) Notes to Financial Statements
17
<PAGE> 19
Independent Auditor's Report
To the Board of Directors
of InterConexus.com, Inc.
Oak Brook, Illinois
We have audited the accompanying balance sheet of InterConexus.com, Inc. (a
development stage company) as of March 28, 2000 and the related statements of
stockholder's equity and cash flows for the one day period then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements referred to above are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of InterConexus.com, Inc. as of
March 28, 2000, and results of its operations and cash flows for the one day
period then ended in conformity with generally accepted accounting principles.
/s/ Klesman, Halper & Co., P.C.
March 28, 2000
Palos Heights, Illinois
18
<PAGE> 20
InterConexus.com, Inc.
(a development stage company)
Balance Sheet
March 28, 2000
Assets
------
Current assets:
Cash and cash equivalents $ 10,000
--------
Total assets $ 10,000
========
Liabilities and stockholder's equity
------------------------------------
Liabilities $ -
--------
Stockholder's equity:
Common Stock (par value $.0001 per share,
20,000,000 shares authorized, 1,000
shares issued and outstanding) -
Additional paid-in capital 10,000
--------
Total stockholder's equity 10,000
--------
Total liabilities and stockholder's equity $ 10,000
========
The accompanying notes to financial statements
are an integral part of this statement.
19
<PAGE> 21
InterConexus.com, Inc.
(a development stage company)
Statement of Stockholder's Equity
For the one day period ending March 28, 2000
Additional
Common paid-in
Total stock capital
----- ----- -------
Balance, beginning of period $ - $ - $ -
Common stock issued,
(1,000 shares) 10,000 - 10,000
-------- -------- --------
Balance, end of period $ 10,000 $ - $ 10,000
======== ======== ========
The accompanying notes to financial statements
are an integral part of this statement.
20
<PAGE> 22
InterConexus.com, Inc.
(a development stage company)
Statement of Cash Flows
For the one day period ending March 28, 2000
Cash flows from operating activities:
None $ -
Cash flows from investing activities:
None -
Cash flows from financing activities:
Common stock issued 10,000
--------
Net increase in cash and cash equivalents 10,000
Cash and cash equivalents:
Beginning of period -
--------
End of period $ 10,000
========
The accompanying notes to financial statements
are an integral part of this statement.
21
<PAGE> 23
InterConexus.com, Inc.
Notes to Financial Statements
March 28, 2000
Note 1. Summary of significant accounting policies
Description of business
InterConexus.com, Inc. (the "Company") was organized on March 16,
2000 as a corporation in the State of Delaware. The Company is
located in Oak Brook, IL and is a wholly-owned subsidiary of
Capri Corporation (a Minnesota corporation). The Company intends
to pursue certain E-commerce opportunities within the global
electronic interconnect industry.
For purposes of this report, the Company's reporting period
consists of the one day period of March 28, 2000. The Company had
no revenues or expenses for that day and, accordingly, no
statement of operations has been presented.
Use of estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect certain reported
amounts and disclosures. Accordingly, actual results could differ
from those estimates.
Cash and cash equivalents
For purposes of the balance sheet and statement of cash flows,
cash and cash equivalents consist of cash in a demand deposit
account held at a local bank.
22
<PAGE> 24
PART III
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
----------- -----------
2.1 Amended and Restated Certificate of Incorporation of the
Company **
2.2 Amended and Restated By-laws of the Company **
3.1 Specimen Certificate for Common Stock **
6.1 Services Agreement **
6.2 InterConexus 2000 Stock Incentive Plan **
10.1 Consent of Klesman, Halper & Co., P.C. *
27.1 Financial Data Schedule *
- -----------------------
* Previously filed.
** Filed herewith.
23
<PAGE> 25
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this Amendment to the Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized.
INTERCONEXUS.COM, INC.
(Registrant)
Date: May 26, 2000 By: /s/ Mehul J. Dave
----------------------------------
Mehul J. Dave
Chairman of the Board, President
and Chief Executive Officer
24
<PAGE> 1
EXHIBIT 2.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
INTERCONEXUS.COM, INC.
---------------------------
PURSUANT TO SECTIONS 242 AND 245 OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
---------------------------
InterConexus.com, Inc. (the "Corporation"), a corporation organized and
existing under the General Corporation Law of the State of Delaware, as amended
from time to time, whose original Certificate of Incorporation was filed on
March 16, 2000, does hereby certify that the following Amended and Restated
Certificate of Incorporation has been duly adopted:
ARTICLE 1. NAME OF CORPORATION
The name of the corporation is INTERCONEXUS.COM, INC. (hereinafter the
"Corporation").
ARTICLE 2. REGISTERED OFFICE AND AGENT
The registered office of the Corporation is to be located at 30 Old
Rudnick Lane, Suite 100, in the City of Dover, in the County of Kent and in the
State of Delaware 19901. The name of its registered agent at that address is
Lexis Document Services Inc.
ARTICLE 3. PURPOSE
The purpose of the Corporation is to engage in any lawful act or
activity for which a corporation may be organized under Delaware Law.
ARTICLE 4. AUTHORIZED STOCK
4.1 AUTHORIZED STOCK. The total number of shares of all classes of
stock which the Corporation shall have authority to issue is Sixty Million
(60,000,000), of which Forty Million
Page 1 of 5
<PAGE> 2
(40,000,000) shares are of a class designated common stock, par value $.0001 per
share ("Common Stock"), and Twenty Million (20,000,000) shares are of a class
designated preferred stock, par value $.001 per share ("Preferred Stock").
The Common Stock and Preferred Stock may be issued from time to time in
one or more series. The board of directors is hereby authorized, subject to
limitations prescribed by law, by filing a certificate pursuant to the
applicable law of the State of Delaware, to fix by resolution or resolutions the
designations, powers, preferences and rights, and the qualifications,
limitations or restrictions thereof, of each such series of Preferred Stock and
Common Stock, including, without limitation, the dividend rights, dividend rate,
conversion rights, voting rights, rights and terms of redemption (including
sinking fund provisions), redemption price or prices, and liquidation
preferences for any unissued series, and the number of shares constituting any
such series and the designation thereof, or any of the foregoing.
4.2 RESTRICTIONS ON TRANSFER OF CORPORATION'S COMMON STOCK. The
stockholders of the Corporation's Common Stock shall not transfer any shares of
Common Stock until the first to occur of the following: (i) the second
anniversary of the date of the distribution of all of the then issued and
outstanding shares of the Corporation's Common Stock to the shareholders of
Capri Corp., a Minnesota corporation (the "Spin-Off"); (ii) the consummation of
an initial public offering of the Common Stock of the Corporation registered
under the Securities Act of 1933, as amended; or (iii) the board of directors of
the Corporation determines, in its sole discretion, that the business of the
Corporation has developed to support a trading market. Notwithstanding the
foregoing, the stockholders of the Corporation's Common Stock shall not be
restricted in any way from transferring any shares of Common Stock (i) in
connection with the Spin-Off, or (ii) by will, intestacy laws or the laws of
descent or survivorship or by operation of law.
Page 2 of 5
<PAGE> 3
ARTICLE 5. BOARD OF DIRECTORS
5.1 SIZE OF BOARD OF DIRECTORS. The number of directors of the
Corporation shall be such as from time to time shall be fixed by, or in the
manner provided in, the by-laws.
5.2 ELECTION OF DIRECTORS. Election of directors need not be by ballot
unless the by-laws so provide.
5.3 VACANCIES AND NEWLY CREATED DIRECTORSHIPS. Except as required by
law or this Certificate of Incorporation, all vacancies on the Board of
Directors and newly-created directorships resulting from any increase in the
authorized number of directors shall be filled by a majority of the directors
then in office, although less than a quorum.
5.4 POWER TO AMEND BY-LAWS. The Board of Directors shall have power
without the assent or vote of the stockholders to make, alter, amend, change,
add to or repeal the by-laws of the Corporation.
ARTICLE 6. LIABILITY OF DIRECTORS
No director of the Corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty by such director as a director; provided, however, that to the extent
required by Delaware Law, this Article 6 shall not eliminate or limit the
liability of a director: (a) for any breach of the director's duty of loyalty to
the Corporation or its stockholders; (b) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law; (c) under
Section 174 of the Delaware Law; or (d) for any transaction from which the
director derived an improper personal benefit.
ARTICLE 7. INDEMNIFICATION OF DIRECTORS AND OTHER PERSONS
The Corporation shall indemnify, in accordance with and to the full
extent now or hereafter permitted by Section 145 of the Delaware Law, 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 (other than an action by or in the right of the
Corporation), by reason of the fact that he or she is or was a director and/or
officer of the
Page 3 of 5
<PAGE> 4
Corporation (and the Corporation, in the discretion of the Board of Directors,
may so indemnify a person by reason of the fact that he or she is or was an
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 or her in connection with such action,
suit or proceeding; provided, however, that the Corporation shall not be
obligated to indemnify any such person: (a) with respect to proceedings, claims
or actions initiated or brought voluntarily by such persons and not by way of
defense; or (b) for any amounts paid in settlement of an action effected without
the prior written consent of the Corporation to such settlement. Such
indemnification is not exclusive of any other right to indemnification provided
by law, by agreement or otherwise.
ARTICLE 8. PROSPECTIVE AMENDMENTS
No amendment to or repeal of Article 6 or Article 7 shall apply to or
have any effect on the rights of any individual referred to in Article 6 or
Article 7 for or with respect to any acts or omissions of such individual
occurring prior to such amendment or repeal.
ARTICLE 9. BINDING COMPROMISES AND ARRANGEMENTS
Whenever a compromise or arrangement is proposed between this
Corporation and its creditors, or any class of them and/or between this
Corporation and its stockholders, or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for this Corporation under the provisions of Section 279 of Title 8 of the
Delaware Code order a meeting of the creditors or class of creditors, and/or the
stockholders or class of stockholders of this Corporation, as the case may be,
to be summoned in such manner as the said court directs. If a majority in number
representing three-fourths in value
Page 4 of 5
<PAGE> 5
of the creditors or class of creditors, and/or of the stockholders or class of
stockholders of this Corporation, as the case may be, agree to any compromise or
arrangement and to any reorganization of this Corporation as consequence of such
compromise or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said application
has been made, be binding on all the creditors or class of creditors, and/or on
all the stockholders or class of stockholders of this Corporation, as the case
may be, and also on this Corporation.
ARTICLE 10. SECTION 203 ELECTION
The Corporation hereby expressly elects not to be governed by Section
203 of the Delaware Law.
ARTICLE 11. DURATION OF CORPORATION
The Corporation is to have a perpetual existence.
ARTICLE 12. RESERVED RIGHTS
The Corporation reserves the right to amend, alter, change or repeal
any provision contained in this Certificate of Incorporation in the manner now
or hereafter prescribed by law, and all rights and powers conferred herein on
stockholders, directors and officers are subject to this reserved power.
IN WITNESS WHEREOF, I have hereunto set my hand and seal.
Dated: May 12, 2000
/s/ Mehul J. Dave
-------------------------------------
Mehul J. Dave
President and Chief Executive Officer
InterConexus.com, Inc.
Page 5 of 5
<PAGE> 1
EXHIBIT 2.2
AMENDED AND RESTATED
BY-LAWS
OF
INTERCONEXUS.COM, INC.
ARTICLE I
OFFICES
SECTION 1. REGISTERED OFFICE. The registered office shall be
established and maintained at the office of Lexis Document Services Inc., in the
City of Dover, in the County of Kent, in the State of Delaware, and said
corporation shall be the registered agent of this corporation in charge thereof.
SECTION 2. OTHER OFFICES. The corporation may have other offices,
either within or without the State of Delaware, at such place or places as the
Board of Directors may from time to time appoint or the business of the
corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 1. ANNUAL MEETINGS. Annual meetings of stockholders for the
election of directors and for such other business as may be stated in the notice
of the meeting, shall be held at such place, either within or without the State
of Delaware, as may from time to time be fixed by the Board of Directors.
Subject to the provisions of Section 5 of this Article II, each meeting of
stockholders for any purpose may be held at such place, within or without the
State of Delaware, as shall be fixed by the Board of Directors, and at such time
and date as the Board of Directors shall determine and as set forth in the
notice of the meeting.
SECTION 2. OTHER MEETINGS. Meetings of stockholders for any purpose
other than the election of directors may be held at such time and place, within
or without the State of Delaware, as shall be stated in the notice of the
meeting.
SECTION 3. VOTING. Each stockholder entitled to vote in accordance with
the terms of the Certificate of Incorporation and in accordance with the
provisions of these By-Laws shall be entitled to one vote, in person or by
proxy, for each share of stock entitled to vote held by such stockholder, but no
proxy shall be voted after three years from its date unless such proxy provides
for a longer period. Upon the demand of any stockholder, the vote for directors
and the vote upon any question before the meeting, shall be by ballot. All
elections for directors shall be decided by
<PAGE> 2
plurality vote; all other questions shall be elected by majority vote except as
otherwise required by the Certificate of Incorporation or the laws of the State
of Delaware.
A complete list of the stockholders entitled to vote at the ensuing
election, arranged in alphabetical order, with the address of each, and the
number of shares held by each, shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary business
hours, for a period of at least ten days prior to the meeting, either at a place
within the city where the meeting is to be held, which place shall be specified
in the notice of the meeting, or, if not so specified, at the place where the
meeting is to be held. The list shall also be produced and kept at the time and
place of the meeting during the whole time thereof, and may be inspected by any
stockholder who is present.
SECTION 4. QUORUM. Except as otherwise required by Law, by the
Certificate of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until the requisite amount of stock entitled to
vote shall be present. At any such adjourned meeting at which the requisite
amount of stock entitled to vote shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed; but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof.
SECTION 5. SPECIAL MEETINGS. Special meetings of the stockholders for
any purpose or purposes may be called by the President or Secretary, or by
resolution of the directors.
SECTION 6. NOTICE OF MEETINGS. Written notice, stating the place, date
and time of the meeting, and the general nature of the business to be
considered, shall be given to each stockholder entitled to vote thereat at his
address as it appears on the records of the corporation, not less than ten nor
more than sixty days before the date of the meeting. No business other than that
stated in the notice shall be transacted at any meeting without the unanimous
consent of all the stockholders entitled to vote thereat.
SECTION 7. ACTION WITHOUT MEETING. Unless otherwise provided by the
Certificate of Incorporation, any action required to be taken at any annual or
special meeting of stockholders, or any action which may be taken at any annual
or special meeting, may be taken without a meeting, without prior notice and
without a vote, if a consent or consents in writing, setting forth the action so
taken, shall be signed by the holders of outstanding stock having not less than
the minimum number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon were present
and voted. Every written consent shall bear the date of signature of each
stockholder who signs the consent. Prompt notice of the taking of the corporate
action without a meeting by less than unanimous written consent shall be given
to those stockholders who have not consented in writing.
2
<PAGE> 3
ARTICLE III
DIRECTORS
SECTION 1. ELECTION OF DIRECTORS; TERMS OF OFFICE. At all meetings of
the stockholders for the election of directors at which a quorum is present, the
persons receiving the greatest number of votes shall be the directors. Each
director of the corporation shall hold office until the next annual meeting of
stockholders and, subject to Section 2 of this Article III, until his successor
is elected and qualified or until his earlier resignation or removal.
SECTION 2. NUMBER OF DIRECTORS. The number of directors which shall
constitute the whole board of directors of the corporation shall be not less
than three nor more than fifteen. Within such limits the number of directors
shall be as fixed at any meeting of the board of directors by resolution adopted
by a majority of the directors then in office or by the stockholders at any
annual meeting or at any special meeting called for that purpose; provided,
however, that the number of directors constituting the whole board shall not be
decreased by the board of directors below the number then in office unless such
decrease shall become effective at an annual meeting of stockholders. Vacancies
created by an increase in the number of directors may be filled as provided in
Section 3 of this Article III.
SECTION 3. FILLING OF VACANCIES. In the event of a vacancy in the board
of directors or in any committee of directors, including a prospective vacancy
due to a resignation to be effective at a future date, a majority of the
directors, excluding any directors who shall theretofore have resigned effective
as of a future date, may, although less than a majority of the directors then in
office, appoint any person to fill such vacancy upon the occurrence thereof,
such person to hold office for the unexpired term of such office or until his
earlier resignation or removal.
SECTION 4. RESIGNATIONS. Any director, member of a committee or other
officer may resign at any time. Such resignation shall be made in writing, and
shall take effect at the time specified therein, and if no time be specified, at
the time of its receipt by the President or Secretary. The acceptance of a
resignation shall not be necessary to make it effective.
SECTION 5. REMOVAL. Except as hereinafter provided, any director or
directors may be removed either for or without cause at any time by the
affirmative vote of the holders of a majority of all the shares of stock
outstanding and entitled to vote, at a special meeting of the stockholders
called for the purpose and the vacancies thus created may be filled, at the
meeting held for the purpose of removal, by the affirmative vote of the holders
of a majority of all shares of stock outstanding and entitled to vote.
If the holders of any class or series are entitled to elect one or more
directors by the provisions of the Certificate of Incorporation, these
provisions shall apply, in respect to the removal without cause of a director or
directors so elected, to the vote of the holders of the outstanding shares of
that class or series and not to the vote of the outstanding shares as a whole.
3
<PAGE> 4
SECTION 6. POWERS. The Board of Directors shall exercise all of the
powers of the corporation except such as are by law, or by the Certificate of
Incorporation of the corporation or by these By-Laws conferred upon or reserved
to the stockholders.
SECTION 7. COMMITTEES. The Board of Directors may, by resolution or
resolutions passed by a majority of the whole board, designate one or more
committees, each committee to consist of two or more of the directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.
Any such committee, to the extent provided in the resolution of the
Board of Directors, or in these By-Laws, shall have and may exercise all the
powers and authority of the Board of Directors in the management of the business
and affairs of the corporation, and may authorize the seal of the corporation to
be affixed to all papers which may require it; but no such committee shall have
the power or authority in reference to amending the Certificate of
Incorporation, adopting an agreement of merger or consolidation, recommending to
the stockholders the sale, lease or exchange of all or substantially all of the
corporation's property and assets, recommending to the stockholders a
dissolution of the corporation or a revocation of a dissolution, or amending the
By-Laws of the corporation; and, unless the resolution, these By-Laws, or the
Certificate of Incorporation expressly so provide, no such committee shall have
the power or authority to declare a dividend or to authorize the issuance of
stock.
SECTION 8. MEETINGS. The newly elected directors may hold their first
meeting for the purpose of organization and the transaction of business, if a
quorum be present, immediately after the annual meeting of the stockholders; or
the time and place of such meeting may be fixed by consent in writing of all the
directors.
Regular meetings of the directors may be held without notice at such
places and times as shall be determined from time to time by resolution of the
directors.
Special meetings of the board may be called by the President or by the
Secretary on the written request of any two directors on at least two day's
notice to each director and shall be held at such place or places as may be
determined by the directors, or as shall be stated in the call of the meeting.
Unless otherwise restricted by the Certificate of Incorporation or
these By-Laws, members of the Board of Directors, or any committee designated by
the Board of Directors, may participate in a meeting of the Board of Directors,
or any committee, by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and such participation in a meeting shall constitute presence in
person at the meeting.
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SECTION 9. QUORUM. A majority of the directors shall constitute a
quorum for the transaction of business, except as otherwise provided in Section
3 of this Article III. If at any meeting of the board there shall be less than a
quorum present, a majority of those present may adjourn the meeting from time to
time until a quorum is obtained, and no further notice thereof need be given
other than by announcement at the meeting which shall be so adjourned.
SECTION 10. COMPENSATION. Directors shall not receive any stated salary
for their services as directors or as members of committees, but by resolution
of the board a fixed fee and expenses of attendance may be allowed for
attendance at each meeting. Nothing herein contained shall be construed to
preclude any director from serving the corporation in any other capacity as an
officer, employee, agent or otherwise, and receiving compensation therefor.
SECTION 11. ACTION WITHOUT MEETING. Any action required or permitted to
be taken at any meeting of the Board of Directors, or of any committee thereof,
may be taken without a meeting, if a written consent thereto is signed by all
members of the board, or of such committee as the case may be, and such written
consent is filed with the minutes of proceedings of the board or committee.
ARTICLE IV
OFFICERS
SECTION 1. OFFICERS. The officers of the corporation shall be a
President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified. In addition, the Board of Directors may elect a Chairman, one or
more Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as
they may deem proper. None of the officers of the corporation need be directors.
The officers shall be elected at the first meeting of the Board of Directors
after each annual meeting. More than two offices may be held by the same person.
SECTION 2. REMOVAL OF OFFICERS. Any officer may be removed, either with
or without cause, by the vote of a majority of the directors then in office at
any meeting of the board of directors, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed.
SECTION 3. OTHER OFFICERS AND AGENTS. The Board of Directors may
appoint such other officers and agents as it may deem advisable, who shall hold
their offices for such terms and shall exercise such powers and perform such
duties as shall be determined from time to time by the Board of Directors.
SECTION 4. CHAIRMAN. The Chairman of the Board of Directors, if one be
elected, shall preside at all meetings of the Board of Directors and he shall
have and perform such other duties as from time to time may be assigned to him
by the Board of Directors.
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SECTION 5. PRESIDENT. The President shall be the chief executive
officer of the corporation and shall have the general powers and duties of
supervision and management usually vested in the office of President of a
corporation. He shall preside at all meetings of the stockholders if present
thereat, and in the absence or non-election of the Chairman of the Board of
Directors, at all meetings of the Board of Directors, and shall have general
supervision, direction and control of the business of the corporation. Except as
the Board of Directors shall authorize the execution thereof in some other
manner, he shall execute bonds, mortgages and other contracts in behalf of the
corporation, and shall cause the seal to be affixed to any instrument requiring
it and when so affixed the seal shall be attested by the signature of the
Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer.
SECTION 6. VICE-PRESIDENT. Each Vice-President shall have such powers
and shall perform such duties as shall be assigned to him by the directors.
SECTION 7. TREASURER. The Treasurer shall have the custody of the
corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.
The Treasurer shall disburse the funds of the corporation as may be
ordered by the Board of Directors, or the President, taking proper vouchers for
such disbursements. He shall render to the President and Board of Directors at
the regular meetings of the Board of Directors, or whenever they may request it,
an account of all his transactions as Treasurer and of the financial condition
of the corporation. If required by the Board of Directors, he shall give the
corporation a bond for the faithful discharge of his duties in such amount and
with such surety as the board shall prescribe.
SECTION 8. SECRETARY. The Secretary shall give, or cause to be given,
notice of all meetings of stockholders and directors, and all other notices
required by law or by these By-Laws, and in case of his absence or refusal or
neglect so to do, any such notice may be given by any person thereunto directed
by the President, or by the directors, or stockholders, upon whose requisition
the meeting is called as provided in these By-Laws. He shall record all the
proceedings of the meetings of the corporation and of the directors in a book to
be kept for that purpose, and shall perform such other duties as may be assigned
to him by the directors or the President. He shall have the custody of the seal
of the corporation and shall affix the same to all instruments requiring it,
when authorized by the directors or the President, and attest the same.
SECTION 9. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the directors.
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ARTICLE V
MISCELLANEOUS
SECTION 1. CERTIFICATES OF STOCK. A certificate of stock, signed by the
Chairman or Vice Chairman of the Board of Directors, if they be elected,
President or Vice-President, and the Treasurer or an Assistant Treasurer, or
Secretary or an Assistant Secretary, shall be issued to each stockholder
certifying the number of shares owned by him in the corporation. Any of or all
the signatures may be facsimiles.
SECTION 2. LOST CERTIFICATES. A new certificate of stock may be issued
in the place of any certificate theretofore issued by the corporation, alleged
to have been lost or destroyed, and the directors may, in their discretion,
require the owner of the lost or destroyed certificate, or his legal
representatives, to give the corporation a bond, in such sum as they may direct,
not exceeding double the value of the stock, to indemnify the corporation
against any claim that may be made against it on account of the alleged loss of
any such certificate, or the issuance of any such new certificate.
SECTION 3. TRANSFER OF SHARES. The shares of stock of the corporation
shall be transferable only upon its books by the holders thereof in person or by
their duly authorized attorneys or legal representatives, and upon such transfer
the old certificates shall be surrendered to the corporation by the delivery
thereof to the person in charge of the stock and transfer books and ledgers, or
to such other person as the directors may designate, by whom they shall be
canceled, and new certificates shall thereupon be issued. A record shall be made
of each transfer and whenever a transfer shall be made for collateral security,
and not absolutely, it shall be so expressed in the entry of the transfer.
SECTION 4. STOCKHOLDERS RECORD DATE. In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than sixty nor less than ten
days before the date of such meeting, nor more than sixty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
SECTION 5. DIVIDENDS. Subject to the provisions of the Certificate of
Incorporation, the Board of Directors may, out of funds legally available
therefor at any regular or special meeting, declare dividends upon the capital
stock of the corporation as and when they deem expedient. Before declaring any
dividend there may be set apart out of any funds of the corporation available
for dividends, such sum or sums as the directors from time to time in their
discretion deem proper for
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working capital or as a reserve fund to meet contingencies or for equalizing
dividends or for such other purposes as the directors shall deem conducive to
the interests of the corporation.
SECTION 6. SEAL. The corporate seal shall be circular in form and shall
contain the name of the corporation, the year of its creation and the words
"CORPORATE SEAL DELAWARE". Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.
SECTION 7. FISCAL YEAR. The fiscal year of the corporation shall be
determined by resolution of the Board of Directors.
SECTION 8. CHECKS. All checks, drafts or other orders for the payment
of money, notes or other evidences of indebtedness issued in the name of the
corporation shall be signed by such officer or officers, agent or agents of the
corporation, and in such manner as shall be determined from time to time by
resolution of the Board of Directors.
SECTION 9. NOTICE AND WAIVER OF NOTICE. Whenever any notice is required
by these By-Laws to be given, personal notice is not meant unless expressly so
stated, and any notice so required shall be deemed to be sufficient if given by
depositing the same in the United States mail, postage prepaid, addressed to the
person entitled thereto at his address as it appears on the records of the
corporation, and such notice shall be deemed to have been given on the day of
such mailing. Stockholders not entitled to vote shall not be entitled to receive
notice of any meetings except as otherwise provided by Statute.
Whenever any notice whatever is required to be given under the
provisions of any law, or under the provisions of the Certificate of
Incorporation of the corporation or these By-Laws, a waiver thereof in writing,
signed by the person or persons entitled to said notice, whether before or after
the time stated therein, shall be deemed equivalent thereto.
ARTICLE VI
AMENDMENTS
These By-Laws may be altered or repealed and By-Laws may be made at any
annual meeting of the stockholders or at any special meeting thereof if notice
of the proposed alteration or repeal or By-Law or By-Laws to be made be
contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular
meeting of the Board of Directors, or at any special meeting of the Board of
Directors, if notice of the proposed alteration or repeal, or By-Law or By-Laws
to be made, be contained in the notice of such special meeting.
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ARTICLE VII
INDEMNIFICATION OF OFFICERS,
DIRECTORS, EMPLOYEES AND AGENTS
SECTION 1. 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 (other than an action by or in the right of the corporation) 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, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which 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 reasonable cause to believe that his conduct was unlawful.
SECTION 2. 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 or suit by or in the right of the corporation to procure a
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) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit 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 except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the corporation unless and only to the extent that
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper.
SECTION 3. To the extent that a director, officer, employee or agent of
the corporation has been successful on the merits or otherwise in the defense of
any action, suit or proceeding referred to in Sections 1 and 2, or in defense of
any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
SECTION 4. Any indemnification under Sections 1 and 2 (unless ordered
by a court) shall be made by the corporation only as authorized in the specific
case upon a determination that indemnification of the director, officer,
employee or agent is proper in the circumstances because he
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has met the applicable standard of conduct set forth in Sections 1 and 2. Such
determination shall be made (a) by the board of directors by a majority vote of
a quorum consisting of directors who were not parties to such action, suit or
proceeding, or (b) if such a quorum is not obtainable, or, even if obtainable, a
quorum of disinterested directors so directs, by independent legal counsel in a
written opinion, or (c) by the stockholders.
SECTION 5. Expenses (including attorneys' fees) incurred in defending a
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 upon receipt of an undertaking by or on behalf of the
director or officer to repay such amount if it shall ultimately be determined
that he is not entitled to be indemnified by the corporation as authorized in
this Article. Such expenses (including attorneys' fees) incurred by other
employees and agents may be so paid upon such terms and conditions, if any, as
the board of directors deems appropriate.
SECTION 6. The indemnification and advancement of expenses provided by,
or granted pursuant to, other Sections of this Article shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any by-law, agreement, 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.
SECTION 7. The corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
corporation, or who 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 any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify him against
such liability under the provisions of this Article.
SECTION 8. The indemnification and advancement of expenses provided by,
or granted pursuant to, this Article shall, unless otherwise provided when
authorized or ratified, 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.
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EXHIBIT 3.1
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
The shares evidenced hereby have not been registered under the
Securities Act of 1933 or any state securities laws, have been
acquired for investment and not for resale or distribution, and
may not be sold or transferred unless in the opinion of counsel
for the issuer such sale or transfer will not violate applicable
securities laws.
NUMBER SHARES
AUTHORIZED CAPITAL 20,000,000 SHARES $.0001 PAR VALUE
This Certifies That ______________________________________ is the owner of
___________________________________________ full paid and non-assessable SHARES
OF THE CAPITAL STOCK OF INTERCONEXUS.COM, INC. transferable on the books of the
Corporation in person or by duly authorized Attorney upon surrender of this
Certificate properly endorsed.
In Witness Whereof the said Corporation has caused this Certificate to be signed
by its duly authorized officers and sealed with the Seal of the Corporation,
this _____________________ day of __________________ A.D. _______
- --------------------------- ---------------------------
SECRETARY PRESIDENT
<PAGE> 2
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE
FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
FOR VALUE RECEIVED, _____________ hereby sell, assign and transfer
unto ___________________________________________________________________
_______________________________________________________________ Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint ______________________________________, Attorney to transfer the said
Shares on the books of the within named Corporation with full power of
substitution in the premises.
Dated _________________________
In presence of
------------------------------
- ------------------------------
<PAGE> 1
EXHIBIT 6.1
SERVICES AGREEMENT
THIS SERVICES AGREEMENT ("Agreement") is dated as of March 16, 2000 by
and between INTERCONEXUS.COM, Inc., a Delaware corporation ("InterConexus"), and
CIMNET SYSTEMS, INC., an Illinois corporation ("Cimnet").
W I T N E S S E T H:
WHEREAS, InterConexus and Cimnet are both wholly-owned subsidiaries of
Capri Corp., a Minnesota corporation ("Capri"); and
WHEREAS, the parties hereto believe that the mutual rendering of
services and providing of equipment and facilities by Cimnet and InterConexus to
each other will be to the mutual benefit of each of the parties hereto; and
WHEREAS, Capri intends to distribute all of the issued and outstanding
capital stock of InterConexus to the shareholders of Capri (the "Spin-Off"), and
the parties desire that the mutual rendering of services and providing of
equipment and facilities by Cimnet and InterConexus under this Agreement
continue even in the event of the Spin-Off;
NOW, THEREFORE, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties,
InterConexus and Cimnet hereby agree as follows:
1. Cimnet will provide such facilities, equipment and services as
reasonably requested by InterConexus and InterConexus will provide such
facilities, equipment and services as reasonably requested by Cimnet and its
subsidiaries. In addition, the parties shall share the services of each of their
respective employees as they mutually agree. Notwithstanding the foregoing, in
no event shall either party be required to hire any additional personnel or
acquire any additional facilities or equipment to provide facilities, equipment
or services pursuant to this Agreement.
2. The party providing services, shared employees, equipment and
facilities will be reimbursed by the party receiving such services, such
equipment and such facilities on the basis of an allocation of the costs and
expenses (including, without limitation, taxes) for such shared employees
(including, without limitation, applicable benefits), services, equipment and
facilities based on the cost accounting method used by Cimnet and its
subsidiaries and InterConexus. The respective compensation expenses of shared
employees will be divided between the parties based upon the level and amount of
services performed by such employees for each party.
3. Each calendar month the parties shall prepare a schedule of the
allocated costs that such party has incurred on behalf of the other party and
the party having a debit balance for the subject month shall pay to the party
having a credit balance the amount owed. Once each year after the close of the
year, the parties shall prepare a schedule of all of the costs and expenses as
allocated for such year which schedule shall be subject to review by independent
auditors appointed by the parties to review the annual schedule. The parties
shall split equally the costs and expenses of the independent auditors. The
decision of the independent auditors with respect to the appropriate allocation
of costs shall be final. As soon as practicable after the review of the annual
schedule of costs and expenses by
<PAGE> 2
the independent auditors for any year, the party, if any, having a debit balance
for such year, shall pay any amounts owed for such year to the other party.
4. InterConexus acknowledges and agrees that Cimnet is presently a
tenant under that certain Lease between Cimnet and The Rreef Funds for the
premises located at 2301 West 22nd Street, Suite 203, Oak Brook, Illinois, part
of which space InterConexus utilizes, and that for purposes of determining the
costs allocated with respect to space at such facility, such costs will be based
to the extent applicable on the amounts payable under said lease. InterConexus
further acknowledges and agrees that Cimnet will be relocating its offices to
2651 Warrenville Road, Suite 560, Downers Grove, Illinois, pursuant to that
certain Lease between Cimnet and National Build to Suit Corridors I, L.L.C.,
dated February 9, 2000 (the "New Lease"). InterConexus acknowledges and agrees
that for purposes of determining the costs allocated with respect to space under
the New Lease at such facility, such costs will be based to the extent
applicable on the amounts payable under the New Lease.
5. During the term of this Agreement, Cimnet and InterConexus will each
keep and maintain complete and accurate records and books of account in
sufficient detail and form to permit the determination of the costs and expenses
due and payable to the other party hereunder.
6. (a) Subject to Section 7 of this Agreement, InterConexus agrees to
protect, defend, hold harmless and indemnify Cimnet and its successors, assigns,
directors, officers, employees, and agents (collectively, the "Cimnet
Representatives"), from and against any and all claims, demands, actions,
liabilities, damages, losses, fines, penalties, costs and expenses, including
reasonable attorneys' fees, of any kind whatsoever (collectively referred to as
"Claims"), actually or allegedly, directly or indirectly, arising out of or
resulting from or connected with (i) any actions taken or omitted to be taken by
Cimnet or any of the Cimnet Representatives in connection with the performance
of any of the services, shared employees, facilities or equipment to be provided
hereunder, other than Claims that are the direct result of the gross negligence
or willful misconduct of Cimnet, (ii) any services, shared employees, facilities
or equipment provided by or through Cimnet in reliance on or incorporating
information or services, shared employees, facilities or equipment provided by
InterConexus pursuant to this Agreement, (iii) the omission or commission of any
act, lawful or unlawful, by InterConexus or its agents, employees, or
contractors, whether or not such act is within the scope of the agency,
employment, or contract of such agents, employees, or contractors, (iv) the
failure of InterConexus to comply with any applicable law, ordinance, rule or
regulation, (v) inquiries and/or investigations by any foreign or U.S. federal
or state governmental organization of InterConexus, and (vi) any alleged
negligence of InterConexus.
(b) Subject to Section 7 of this Agreement, Cimnet agrees to
protect, defend, hold harmless and indemnify InterConexus, its successors,
assigns, directors, officers, employees and agents (collectively, the "IC
Representatives"), from and against any and all Claims, actually or allegedly,
directly or indirectly, arising out of or resulting from or connected with (i)
any actions taken or omitted to be taken by InterConexus or any of the IC
Representatives in connection with the performance of any of the services,
shared employees, facilities or equipment to be provided hereunder, other than
Claims that are the direct result of the gross negligence or willful misconduct
of InterConexus, (ii) any services, shared employees, facilities or equipment
provided by or through InterConexus in reliance on or incorporating information
or services, shared employees, facilities or equipment provided by Cimnet
pursuant to this Agreement, (iii) the omission or commission of any act, lawful
or unlawful, by Cimnet or its agents, employees, or contractors, whether or not
such act is within the scope of the agency, employment, or contract of such
agents, employees or contractors, (iv) the failure of Cimnet to comply
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with any applicable law, ordinance, rule or regulation, (v) inquiries and/or
investigations by any foreign or U.S. federal or state governmental organization
of Cimnet, and (vi) any alleged negligence of Cimnet.
7. No party to this Agreement will be liable to any other party to this
Agreement or to any other person or entity for special, indirect, consequential
or punitive damages caused by, attributable to or arising in connection with the
performance, nonperformance or delayed performance of the services or the
providing of shared employees, equipment or facilities contemplated by this
Agreement, or any act or omission of Cimnet, InterConexus or any person or
entity acting on behalf of Cimnet or InterConexus, whether negligent or
otherwise, including, without limitation, damages relating to loss of profit or
business interruption, however such damages may be caused, except for such
damages attributable to Cimnet's or InterConexus' or such other person's or
entity's gross negligence or willful misconduct. No party to this Agreement will
be liable for any failure to perform or any delay in the performance of its
obligations hereunder due to force majeure or any cause beyond its reasonable
control.
8. CIMNET AND INTERCONEXUS MAKE NO EXPRESS OR IMPLIED REPRESENTATIONS
OR WARRANTIES, INCLUDING, WITHOUT LIMITATION, WARRANTIES IMPLIED BY LAW OR
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, REGARDING THIS AGREEMENT,
OR WITH RESPECT TO THE PERFORMANCE OF SERVICES OR THE PROVIDING OF SHARED
EMPLOYEES, FACILITIES OR EQUIPMENT CONTEMPLATED BY THIS AGREEMENT.
9. In connection with the services, shared employees, facilities and/or
equipment provided hereunder, a party (the "Disclosing Party") may provide to
another party (the "Receiving Party") information that is confidential or
proprietary in nature (the "Confidential Information"), which may include, but
is not limited to, information of a technical, administrative and/or financial
nature relating to the business operations of the Disclosing Party. The
Receiving Party agrees that the Confidential Information shall be kept
confidential and, except with the prior written consent of the Disclosing Party,
shall not, for the term of this Agreement and for the "Restricted Period" (as
hereinafter defined) thereafter: (a) disclose to any third party any of the
Confidential Information disclosed to the Receiving Party hereunder in any
manner whatsoever; (b) permit any third party to have access to such
Confidential Information; or (c) use such Confidential Information for any
purpose other than providing or utilizing the services, shared employees,
facilities or equipment provided under this Agreement. Moreover, the Receiving
Party agrees to allow access to the Confidential Information only by its
employees or agents who, in the Receiving Party's reasonable discretion, need to
know the Confidential Information for the sole purpose of providing or utilizing
the services, shared employees, facilities or equipment provided under this
Agreement. The Restricted Period shall mean, with respect to Confidential
Information other than trade secrets, two (2) years from the date of termination
of the term or any renewal term of this Agreement, and as to trade secrets,
until such time as the last trade secret ceases to be a trade secret of the
Disclosing Party. The Confidential Information shall not include information
that (a) has come into the public domain through no fault of or action by the
Receiving Party; (b) is rightfully available to the Receiving Party prior to its
disclosure hereunder; (c) becomes available to the Receiving Party from any
third party not having an obligation of confidentiality to the Disclosing Party;
or (d) is independently developed by the Receiving Party without the
Confidential Information of the Disclosing Party. Notwithstanding the foregoing,
the Receiving Party may disclose Confidential Information to any person to whom
such disclosure is required by law or valid order of a court, but only to the
extent of and for the purposes required by law
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or such valid order of a court and only if the Receiving Party first notifies
the Disclosing Party of the law or order and permits the Disclosing Party to
seek an appropriate protective order or other relief.
10. Cimnet and InterConexus agree that, other than with respect to any
Confidential Information of a Disclosing Party, any ideas, concepts, techniques,
know-how, information, reports, programs (including software programs), program
materials, documentation, diagrams, notes, outlines, flow charts, user
interfaces, technology, formulas, processes, algorithms, inventions and the
like, and any and all copyrights, patents, trademarks, trade secrets, and all
other proprietary rights therein and derivative works created therefrom,
created, invented, developed or placed in fixed form by an employee (shared or
otherwise) or agent of Cimnet or InterConexus at such time as such employee or
agent is working on the business of the other, shall be the sole and exclusive
property of the party on whose business such employee or agent is working on at
such time (such party hereinafter referred to as the "Owning Party"). Such
ownership shall inure to the benefit of the Owning Party from the date of the
conception, creation, invention, development or fixation. All newly created
copyright aspects of any written materials shall be considered a
"work-made-for-hire" within the meaning of the Copyright Act of 1976, as
amended. If and to the extent the written materials, or any part thereof, are
found by a court of competent jurisdiction not to be a "work-made-for-hire"
within the meaning of the Copyright Act of 1976, as amended, Cimnet or
InterConexus, as applicable, hereby assigns to the Owning Party all exclusive
right, title and interest in and to those newly created copyrightable aspects of
the written materials and all copies thereof without further consideration.
Cimnet or InterConexus, as applicable, agrees to assist the Owning Party in
obtaining and enforcing all rights and other legal protections for the written
materials and to execute any and all documents that the Owning Party may
reasonably request in connection therewith, including any copyright assignment
document(s). Notwithstanding the foregoing, in the event that Cimnet or
InterConexus, as applicable, has proprietary information that it wants to
provide the other through a shared employee or agent or otherwise on a basis
other than the above, Cimnet and InterConexus shall discuss the terms and
conditions upon which such proprietary information will be provided to the
other, provided that neither Cimnet or InterConexus, as applicable, shall be
under any obligation to reach agreement on the terms of such arrangement.
11. This Agreement shall be for an initial term commencing as of the
date first set forth above and ending on December 31, 2000, and thereafter shall
continue on a year to year basis. Notwithstanding the foregoing, the term of
this Agreement may be terminated by any party, without penalty, upon not less
than thirty (30) days prior written notice to the other parties of the date of
termination, after December 31, 2000.
12. No party has the right to, directly or indirectly, in whole or in
part, assign, delegate, convey or otherwise transfer, whether voluntarily,
involuntarily or by operation of law, its rights and obligations under this
Agreement, except with the prior written approval of the other parties. Any such
prohibited action will be null and void; provided, however, the Spin-Off shall
not constitute or deemed to be a transfer or other prohibited action.
13. The parties hereto expressly acknowledge that no employment,
partnership or joint venture relationship is created by this Agreement, and
hereby agree as follows:
(a) the parties at all times during the term of this Agreement
shall be independent contracting parties;
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(b) neither Cimnet nor InterConexus, nor anyone employed by or
acting for or on behalf of Cimnet or InterConexus, shall ever
be or be construed as an employee of any other party; and
(c) no party shall make any commitment or incur any charge or
expense in the name of another party without the prior written
approval of the other party.
14. The provisions of this Agreement are solely for the benefit of the
parties hereto and their respective successors-in-interest and permitted assigns
and should not be deemed to confer upon third parties any remedy, claim,
liability, reimbursement, cause of action or other right.
15. This Agreement constitutes the entire agreement of the parties with
respect to the subject matter hereof, and supersedes all previous agreements by
and between the parties with respect to the subject matter hereof. The recitals
appearing at the beginning of this Agreement are incorporated into its terms in
full by this reference.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
INTERCONEXUS.COM, INC., a Delaware corporation
By: /s/ Mehul J. Dave
-------------------------------------------
Its: President and Chief Executive Officer
CIMNET SYSTEMS, INC., an Illinois corporation
By: /s/ Mehul J. Dave
-------------------------------------------
Its: President and Chief Executive Officer
5
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EXHIBIT 6.2
INTERCONEXUS.COM, INC.
2000 STOCK INCENTIVE PLAN
1. ESTABLISHMENT, PURPOSE AND TYPES OF AWARDS
InterConexus.com, Inc., a Delaware corporation (the "Company"), hereby
establishes the InterConexus.com, Inc. 2000 Stock Incentive Plan (the "Plan").
The purpose of the Plan is to promote the long-term growth and profitability of
the Company by (i) providing key people with incentives to improve stockholder
value and to contribute to the growth and financial success of the Company, (ii)
enabling the Company to attract, retain and reward the best-available persons,
and (iii) enabling the Company to incentivize employees of any Affiliate of the
Company who may perform or enable such employees' employer to perform services
for the behest of the Company.
The Plan permits the granting of stock options (including incentive
stock options qualifying under Code section 422 and nonqualified stock options),
stock appreciation rights, restricted or unrestricted stock awards, phantom
stock, performance awards, other stock-based awards, or any combination of the
foregoing.
2. DEFINITIONS
Under this Plan, except where the context otherwise indicates, the
following definitions apply:
(a) "Affiliate" shall mean any entity, whether now or hereafter
existing, which controls, is controlled by, or is under common control with, the
Company (including, but not limited to, joint ventures, limited liability
companies, and partnerships). For this purpose, "control" shall mean ownership
of 50% or more of the total combined voting power or value of all classes of
stock or interests of the entity.
(b) "Award" shall mean any stock option, stock appreciation right,
stock award, phantom stock award, performance award, or other stock-based award.
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Change in Control" means:
(i) an acquisition (other than from the Company) in a
transaction or a series of related transactions by any person, entity
or "group," within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934 (the "EXCHANGE ACT"), (excluding for
this purpose, (A) the Company or its subsidiaries, (B) any employee
benefit plan of the Company or its subsidiaries which acquires
beneficial ownership of voting securities of the Company, (C) an
underwriter temporarily holding securities pursuant to an offering of
such securities, or (D) any corporation owned, directly or indirectly,
by the stockholders of the Company in substantially the same
proportions as their ownership of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors) of beneficial ownership, within the meaning of Rule 13d-3
promulgated under the Exchange Act, of 50% or more of either the then
outstanding shares of common stock or the combined voting power of the
Company's then outstanding voting securities entitled to vote generally
in the election of directors (the "COMPANY VOTING STOCK");
(ii) the effective time of any merger, share
exchange, consolidation or other reorganization or business combination
of the Company if immediately after such transaction persons who hold a
majority of the outstanding voting securities entitled to vote
generally in the election of directors of the surviving entity (or the
entity owning 100% of such surviving entity) are not persons who held
the Company Voting Stock immediately prior to such transaction;
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(iii) the closing of a sale or conveyance of all or
substantially all of the assets of the Company;
(iv) individuals who were the Board's nominees for
election as directors immediately prior to a meeting of the
stockholders of the Company involving an actual or threatened election
contest relating to the election of the directors of the Company, cease
to constitute a majority of the Board following the election; or
(v) the dissolution or liquidation of the Company;
provided, however, that the term "Change in Control" does not include (1) a
public offering of capital stock of the Company that is effected pursuant to a
registration statement filed with, and declared effective by, the Securities and
Exchange Commission under the Securities Act of 1933, or (2) a distribution of
the Company's Common Stock to the shareholders of Capri Corp., a Minnesota
corporation.
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended,
and any regulations promulgated thereunder.
(f) "Common Stock" shall mean shares of common stock of the Company,
par value of $.0001 per share.
(g) "Fair Market Value" shall mean, with respect to a share of the
Company's Common Stock for any purpose on a particular date, the value
determined by the Administrator in good faith. However, if the Common Stock is
registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934,
as amended, and listed for trading on a national exchange or market, "Fair
Market Value" shall mean, as applicable, (i) either the closing price or the
average of the high and low sale price on the relevant date, as determined in
the Administrator's discretion, quoted on the New York Stock Exchange, the
American Stock Exchange, or the Nasdaq National Market; (ii) the last sale price
on the relevant date quoted on the Nasdaq SmallCap Market; (iii) the average of
the high bid and low asked prices on the relevant date quoted on the Nasdaq OTC
Bulletin Board Service or by the National Quotation Bureau, Inc. or a comparable
service as determined in the Administrator's discretion; or (iv) if the Common
Stock is not quoted by any of the above, the average of the closing bid and
asked prices on the relevant date furnished by a professional market maker for
the Common Stock, or by such other source, selected by the Administrator. For
all purposes under this Plan, the term "relevant date" as used in this Section
2(g) shall mean either the date as of which Fair Market Value is to be
determined or the next preceding date on which public trading of the Common
Stock occurs, as determined in the Administrator's discretion.
(h) "Grant Agreement" shall mean a written document memorializing the
terms and conditions of an Award granted pursuant to the Plan and shall
incorporate the terms of the Plan.
(i) "Prior Affiliate" shall mean an entity that at the time of the
issuance of an Award constitutes an Affiliate, but is not an Affiliate at the
time a subsequent determination of affiliation is made.
3. ADMINISTRATION
(a) Administration of the Plan. The Plan shall be administered by the
Board or by such committee or committees as may be appointed by the Board from
time to time (the Board, committee or committees hereinafter referred to as the
"Administrator").
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(b) Powers of the Administrator. The Administrator shall have all the
powers vested in it by the terms of the Plan, such powers to include authority,
in its sole and absolute discretion, to grant Awards under the Plan, prescribe
Grant Agreements evidencing such Awards and establish programs for granting
Awards.
The Administrator shall have full power and authority to take all other
actions necessary to carry out the purpose and intent of the Plan, including,
but not limited to, the authority to: (i) determine the eligible persons to
whom, and the time or times at which Awards shall be granted; (ii) determine the
types of Awards to be granted; (iii) determine the number of shares to be
covered by or used for reference purposes for each Award; (iv) impose such
terms, limitations, restrictions and conditions upon any such Award as the
Administrator shall deem appropriate; (v) modify, amend, extend or renew
outstanding Awards, or accept the surrender of outstanding Awards and substitute
new Awards (provided however, that, except as provided in Section 7(d) of the
Plan, any modification that would materially adversely affect any outstanding
Award shall not be made without the consent of the holder); (vi) accelerate or
otherwise change the time in which an Award may be exercised or becomes payable
and to waive or accelerate the lapse, in whole or in part, of any restriction or
condition with respect to such Award, including, but not limited to, any
restriction or condition with respect to the vesting or exercisability of an
Award following termination of any grantee's employment or other relationship
with the Company; and (vii) establish objectives and conditions, if any, for
earning Awards and determining whether Awards will be paid after the end of a
performance period.
The Administrator shall have full power and authority, in its sole and
absolute discretion, to administer and interpret the Plan and to adopt and
interpret such rules, regulations, agreements, guidelines and instruments for
the administration of the Plan and for the conduct of its business as the
Administrator deems necessary or advisable.
(c) Non-Uniform Determinations. The Administrator's determinations
under the Plan (including without limitation, determinations of the persons to
receive Awards, the form, amount and timing of such Awards, the terms and
provisions of such Awards and the Grant Agreements evidencing such Awards) need
not be uniform and may be made by the Administrator selectively among persons
who receive, or are eligible to receive, Awards under the Plan, whether or not
such persons are similarly situated.
(d) Limited Liability. To the maximum extent permitted by law, no
member of the Administrator shall be liable for any action taken or decision
made in good faith relating to the Plan or any Award thereunder.
(e) Indemnification. To the maximum extent permitted by law and by the
Company's charter and by-laws, the members of the Administrator shall be
indemnified by the Company in respect of all their activities under the Plan.
(f) Effect of Administrator's Decision. All actions taken and decisions
and determinations made by the Administrator on all matters relating to the Plan
pursuant to the powers vested in it hereunder shall be in the Administrator's
sole and absolute discretion and shall be conclusive and binding on all parties
concerned, including the Company, its stockholders, any participants in the Plan
and any other employee, consultant, or director of the Company or an Affiliate,
and their respective successors in interest.
4. SHARES AVAILABLE FOR THE PLAN; MAXIMUM AWARDS
Subject to adjustments as provided in Section 7(d) of the Plan, the
shares of Common Stock that may be issued with respect to Awards granted under
the Plan shall not exceed an aggregate of 2,800,000 shares of Common Stock. The
Company shall reserve such number of shares for Awards under the Plan, subject
to adjustments as provided in Section 7(d) of the Plan. If any Award, or portion
of an Award, under the Plan expires or terminates unexercised, becomes
unexercisable or is forfeited or otherwise terminated, surrendered or canceled
as to any shares, or if any shares of Common Stock are surrendered to the
Company in connection
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<PAGE> 4
with any Award (whether or not such surrendered shares were acquired pursuant to
any Award), or if any shares are withheld by the Company, the shares subject to
such Award and the surrendered and withheld shares shall thereafter be available
for further Awards under the Plan; provided, however, that any such shares that
are surrendered to or withheld by the Company in connection with any Award or
that are otherwise forfeited after issuance shall not be available for purchase
pursuant to incentive stock options intended to qualify under Code section 422.
5. PARTICIPATION
Participation in the Plan shall be open to all employees, officers, and
directors of, and other individuals providing bona fide services to or for, the
Company, or of any Affiliate of the Company, as may be selected by the
Administrator from time to time. The Administrator may also grant Awards to
individuals in connection with hiring, retention or otherwise, prior to the date
the individual first performs services for the Company or an Affiliate provided
that such Awards shall not become vested at least six months subsequent to the
date the individual first performs such services.
6. AWARDS
The Administrator, in its sole discretion, establishes the terms of all
Awards granted under the Plan. Awards may be granted individually or in tandem
with other types of Awards. All Awards are subject to the terms and conditions
provided in the Grant Agreement. The Administrator may permit or require a
recipient of an Award to defer such individual's receipt of the payment of cash
or the delivery of Common Stock that would otherwise be due to such individual
by virtue of the exercise of, payment of, or lapse or waiver of restrictions
respecting, any Award. If any such payment deferral is required or permitted,
the Administrator shall, in its sole discretion, establish rules and procedures
for such payment deferrals.
(a) Stock Options. The Administrator may from time to time grant to
eligible participants Awards of incentive stock options as that term is defined
in Code section 422 or nonqualified stock options; provided, however, that
Awards of incentive stock options shall be limited to employees of the Company
or of any current or hereafter existing "parent corporation" or "subsidiary
corporation," as defined in Code sections 424(e) and (f), respectively, of the
Company. Options intended to qualify as incentive stock options under Code
section 422 must have an exercise price at least equal to Fair Market Value as
of the date of grant, but nonqualified stock options may be granted with an
exercise price less than Fair Market Value as determined in the discretion of
the Administrator. No stock option shall be an incentive stock option unless so
designated by the Administrator at the time of grant or in the Grant Agreement
evidencing such stock option.
(b) Stock Appreciation Rights. The Administrator may from time to time
grant to eligible participants Awards of Stock Appreciation Rights ("SAR"). An
SAR entitles the grantee to receive, subject to the provisions of the Plan and
the Grant Agreement, a payment having an aggregate value equal to the product of
(i) the excess of (A) the Fair Market Value on the exercise date of one share of
Common Stock over (B) the base price per share specified in the Grant Agreement,
times (ii) the number of shares specified by the SAR, or portion thereof, which
is exercised. Payment by the Company of the amount receivable upon any exercise
of an SAR may be made by the delivery of Common Stock or cash, or any
combination of Common Stock and cash, as determined in the sole discretion of
the Administrator. If upon settlement of the exercise of an SAR a grantee is to
receive a portion of such payment in shares of Common Stock, the number of
shares shall be determined by dividing such portion by the Fair Market Value of
a share of Common Stock on the exercise date. No fractional shares shall be used
for such payment and the Administrator shall determine whether cash shall be
given in lieu of such fractional shares or whether such fractional shares shall
be eliminated.
(c) Stock Awards. The Administrator may from time to time grant
restricted or unrestricted stock Awards to eligible participants in such
amounts, on such terms and conditions, and for such consideration,
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<PAGE> 5
including no consideration or such minimum consideration as may be required by
law, as it shall determine. A stock Award may be paid in Common Stock, in cash,
or in a combination of Common Stock and cash, as determined in the sole
discretion of the Administrator.
(d) Phantom Stock. The Administrator may from time to time grant Awards
to eligible participants denominated in stock-equivalent units ("phantom stock")
in such amounts and on such terms and conditions as it shall determine. Phantom
stock units granted to a participant shall be credited to a bookkeeping reserve
account solely for accounting purposes and shall not require a segregation of
any of the Company's assets. An Award of phantom stock may be settled in Common
Stock, in cash, or in a combination of Common Stock and cash, as determined in
the sole discretion of the Administrator. Except as otherwise provided in the
applicable Grant Agreement, the grantee shall not have the rights of a
stockholder with respect to any shares of Common Stock represented by a phantom
stock unit solely as a result of the grant of a phantom stock unit to the
grantee.
(e) Performance Awards. The Administrator may, in its discretion, grant
performance awards which become payable on account of attainment of one or more
performance goals established by the Administrator. Performance awards may be
paid by the delivery of Common Stock or cash, or any combination of Common Stock
and cash, as determined in the sole discretion of the Administrator. Performance
goals established by the Administrator may be based on the Company's or an
Affiliate's operating income or one or more other business criteria selected by
the Administrator that apply to an individual or group of individuals, a
business unit, or the Company or an Affiliate as a whole, over such performance
period as the Administrator may designate.
(f) Other Stock-Based Awards. The Administrator may from time to time
grant other stock-based awards to eligible participants in such amounts, on such
terms and conditions, and for such consideration, including no consideration or
such minimum consideration as may be required by law, as it shall determine.
Other stock-based awards may be denominated in cash, in Common Stock or other
securities, in stock-equivalent units, in stock appreciation units, in
securities or debentures convertible into Common Stock, or in any combination of
the foregoing and may be paid in Common Stock or other securities, in cash, or
in a combination of Common Stock or other securities and cash, all as determined
in the sole discretion of the Administrator.
7. MISCELLANEOUS
(a) Withholding of Taxes. Grantees and holders of Awards shall pay to
the Company or its Affiliate, or make provision satisfactory to the
Administrator for payment of, any taxes required to be withheld in respect of
Awards under the Plan no later than the date of the event creating the tax
liability. The Company or its Affiliate may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind otherwise due to
the grantee or holder of an Award. In the event that payment to the Company or
its Affiliate of such tax obligations is made in shares of Common Stock, such
shares shall be valued at Fair Market Value on the applicable date for such
purposes.
(b) Loans. The Company or its Affiliate may make or guarantee loans to
grantees to assist grantees in exercising Awards and satisfying any withholding
tax obligations.
(c) Transferability. Except as otherwise determined by the
Administrator, and in any event in the case of an incentive stock option or a
stock appreciation right granted with respect to an incentive stock option, no
Award granted under the Plan shall be transferable by a grantee otherwise than
by will or the laws of descent and distribution. Unless otherwise determined by
the Administrator in accord with the provisions of the immediately preceding
sentence, an Award may be exercised during the lifetime of the grantee, only by
the grantee or, during the period the grantee is under a legal disability, by
the grantee's guardian or legal representative.
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(d) Adjustments for Corporate Transactions and Other Events.
(i) Stock Dividend, Stock Split and Reverse Stock Split. In
the event of a stock dividend of, or stock split or reverse stock split
affecting, the Common Stock, (A) the maximum number of shares of such Common
Stock as to which Awards may be granted under this Plan and the maximum number
of shares with respect to which Awards may be granted during any one fiscal year
of the Company to any individual, as provided in Section 4 of the Plan, and (B)
the number of shares covered by and the exercise price and other terms of
outstanding Awards, may, without further action of the Board, be adjusted to
reflect such event unless the Board determines, at the time it approves such
stock dividend, stock split or reverse stock split, that no such adjustment
shall be made. The Administrator may make adjustments, in its discretion, to
address the treatment of fractional shares and fractional cents that arise with
respect to outstanding Awards as a result of the stock dividend, stock split or
reverse stock split.
(ii) Non-Change in Control Transactions. Except with respect
to the transactions set forth in Section 7(d)(i), in the event of any change
affecting the Common Stock, the Company or its capitalization, by reason of a
spin-off, split-up, dividend, recapitalization, merger, consolidation or share
exchange, other than any such change that is part of a transaction resulting in
a Change in Control, the Administrator, in its discretion and without the
consent of the holders of the Awards, may make (A) appropriate adjustments to
the maximum number and kind of shares reserved for issuance or with respect to
which Awards may be granted under the Plan, in the aggregate and with respect to
any individual during any one fiscal year of the Company, as provided in Section
4 of the Plan; and (B) any adjustments in outstanding Awards, including but not
limited to reducing the number, kind and price of securities subject to Awards.
(iii) Pooling of Interests Transactions. In connection with
any business combination authorized by the Board, the Administrator, in its sole
discretion and without the consent of the holders of the Awards, may make any
modifications to any Awards, including but not limited to cancellation,
forfeiture, surrender or other termination of the Awards, in whole or in part,
regardless of the vested status of the Award, but solely to the extent necessary
to facilitate the compliance of such transaction with requirements for treatment
as a pooling of interests transaction for accounting purposes under generally
accepted accounting principles.
(iv) Unusual or Nonrecurring Events. The Administrator is
authorized to make, in its discretion and without the consent of holders of
Awards, adjustments in the terms and conditions of, and the criteria included
in, Awards in recognition of unusual or nonrecurring events affecting the
Company, or the financial statements of the Company or any Affiliate, or of
changes in applicable laws, regulations, or accounting principles, whenever the
Administrator determines that such adjustments are appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan.
(e) Substitution of Awards in Mergers and Acquisitions. Awards may be
granted under the Plan from time to time in substitution for Awards held by
employees, officers, consultants or directors of entities who become or are
about to become employees, officers, consultants or directors of the Company or
an Affiliate as the result of a merger or consolidation of the employing entity
with the Company or an Affiliate, or the acquisition by the Company or an
Affiliate of the assets or stock of the employing entity. The terms and
conditions of any substitute Awards so granted may vary from the terms and
conditions set forth herein to the extent that the Administrator deems
appropriate at the time of grant to conform the substitute Awards to the
provisions of the Awards for which they are substituted.
(f) Stock Restriction Agreement. As a condition precedent to the grant
of any Award under the Plan, the exercise pursuant to such an Award, or to the
delivery of certificates for shares issued pursuant to any
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Award, the Administrator may require the grantee or the grantee's successor or
permitted transferee, as the case may be, to become a party to a stock
restriction agreement of the Company in such form as the Administrator may
determine from time to time.
(g) Termination, Amendment and Modification of the Plan. The Board may
terminate, amend or modify the Plan or any portion thereof at any time.
(h) Non-Guarantee of Employment or Service. Nothing in the Plan or in
any Grant Agreement thereunder shall confer any right on an individual to
continue in the service of the Company or shall interfere in any way with the
right of the Company to terminate such service at any time with or without cause
or notice.
(i) Compliance with Securities Laws; Listing and Registration. If at
any time the Administrator determines that the delivery of Common Stock under
the Plan is or may be unlawful under the laws of any applicable jurisdiction, or
federal or state securities laws, the right to exercise an Award or receive
shares of Common Stock pursuant to an Award shall be suspended until the
Administrator determines that such delivery is lawful. The Company shall have no
obligation to effect any registration or qualification of the Common Stock under
federal or state laws.
The Company may require that a grantee, as a condition to exercise of
an Award, and as a condition to the delivery of any share certificate, make such
written representations (including representations to the effect that such
person will not dispose of the Common Stock so acquired in violation of federal
or state securities laws) and furnish such information as may, in the opinion of
counsel for the Company, be appropriate to permit the Company to issue the
Common Stock in compliance with applicable federal and state securities laws.
The stock certificates for any shares of Common Stock issued pursuant to this
Plan may bear a legend restricting transferability of the shares of Common Stock
unless such shares are registered or an exemption from registration is available
under the Securities Act of 1933, as amended, and applicable state securities
laws.
(j) No Trust or Fund Created. Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company and a grantee or any other person. To
the extent that any grantee or other person acquires a right to receive payments
from the Company pursuant to an Award, such right shall be no greater than the
right of any unsecured general creditor of the Company.
(i) Governing Law. The validity, construction and effect of the Plan,
of Grant Agreements entered into pursuant to the Plan, and of any rules,
regulations, determinations or decisions made by the Administrator relating to
the Plan or such Grant Agreements, and the rights of any and all persons having
or claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the State
of Delaware, without regard to its conflict of laws principles.
(j) Effective Date; Termination Date. The Plan is effective as of the
date on which the Plan is adopted by the Board, subject to approval of the
stockholders within twelve months before or after such date. No Award shall be
granted under the Plan after the close of business on the day immediately
preceding the tenth anniversary of the effective date of the Plan, or if
earlier, the tenth anniversary of the date this Plan is approved by the
stockholders. Subject to other applicable provisions of the Plan, all Awards
made under the Plan prior to such termination of the Plan shall remain in effect
until such Awards have been satisfied or terminated in accordance with the Plan
and the terms of such Awards.
Date Approved by the Board: May 5, 2000
-------------------------
Date Approved by the Stockholders: May 5, 2000
------------------
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APPENDIX A
PROVISIONS FOR CALIFORNIA RESIDENTS
With respect to Awards granted to California residents prior to a public
offering of capital stock of the Company that is effected pursuant to a
registration statement filed with, and declared effective by, the Securities and
Exchange Commission under the Securities Act of 1933 and only to the extent
required by applicable law, the following sections shall be substituted for the
sections set forth in the Plan:
1. ESTABLISHMENT, PURPOSE AND TYPES OF AWARDS
InterConexus.com, Inc., a Delaware corporation (the "Company"), hereby
establishes the InterConexus.com, Inc. 2000 Stock Incentive Plan (the "Plan").
The purpose of the Plan is to promote the long-term growth and profitability of
the Company by (i) providing key people with incentives to improve stockholder
value and to contribute to the growth and financial success of the Company, (ii)
enabling the Company to attract, retain and reward the best-available persons,
and (iii) enabling the Company to incentivize employees of any Affiliate of the
Company who may perform or enable such employees' employer to perform services
for the benefit of the Company. The Plan is intended to be a written
compensatory benefit plan within the meaning of Rule 701 promulgated under the
Securities Act of 1933, as amended.
The Plan permits the granting of stock options (including incentive
stock options qualifying under Code section 422 and nonqualified stock options),
restricted or unrestricted stock awards or any combination of the foregoing.
6. AWARDS
The Administrator, in its sole discretion, establishes the terms of all
Awards granted under the Plan. Awards may be granted individually or in tandem
with other types of Awards. All Awards are subject to the terms and conditions
provided in the Grant Agreement.
(a) Stock Options. The Administrator may from time to time grant to
eligible participants Awards of incentive stock options as that term is defined
in Code section 422 or nonqualified stock options; provided, however, that
Awards of incentive stock options shall be limited to employees of the Company
or of any Parent or Subsidiary of the Company. No stock option shall be an
incentive stock option unless so designated by the Administrator at the time of
grant or in the Grant Agreement evidencing such stock option.
(i) Exercise Price. Options intended to qualify as incentive
stock options under Code section 422 must have an exercise price at least equal
to Fair Market Value on the date of grant; provided, however, that the exercise
price of any incentive stock option granted to a person who directly or by
attribution owns more than ten percent (10%) of the total combined voting power
of all classes of stock of the Company or any Parent or Subsidiary of the
Company (a "Ten Percent Stockholder") must not be less than one hundred ten
percent (110%) of the Fair Market Value on the date of grant. The exercise price
of a nonqualified stock option granted to anyone other than a Ten Percent
Stockholder must not be less than eighty-five percent (85%) of the Fair Market
Value on the date of grant, and the exercise price of a nonqualified stock
option granted to a Ten Percent Stockholder must not be less than one hundred
ten percent (110%) of the Fair Market Value on the date of grant.
(ii) Exercise Period. No option will be exercisable after the
expiration of ten (10) years from the date the option is granted. Subject to
earlier termination of the option as provided herein, each optionee who is not
an officer, director or consultant of the Company or of a Parent or Subsidiary
of the Company shall
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have the right to exercise an option granted hereunder at the rate of no less
than twenty percent (20%) per year over five (5) years from the date such option
is granted.
(b) Stock Awards. The Administrator may from time to time grant
restricted or unrestricted stock Awards to eligible participants in such amounts
and on such terms and conditions as it shall determine. The purchase price of
shares sold pursuant to a restricted or unrestricted stock Award shall be at
least eighty-five percent (85%) of the Fair Market Value on the date of grant or
at the time the purchase is consummated; provided, however, that the purchase
price of shares sold to a Ten Percent Stockholder must be at least one hundred
percent (100%) of the Fair Market Value on the date of grant or at the time the
purchase is consummated.
7. MISCELLANEOUS
(a) [Same as Plan]
(b) [Same as Plan]
(c) Transferability. No Award granted under the Plan shall be
transferable by a grantee otherwise than by will or the laws of descent and
distribution. An Award may be exercised during the lifetime of the grantee, only
by the grantee or, during the period the grantee is under a legal disability, by
the grantee's guardian or legal representative.
(d) [Same as Plan]
(e) [Same as Plan]
(f) [Same as Plan]
(g) [Same as Plan]
(h) [Same as Plan]
(i) Compliance with Securities Laws; Listing and Registration. This
Plan is intended to comply with Section 25102(o) of the California Corporations
Code. Any provision of this Plan which is inconsistent with Section 25102(o),
including without limitation any provision of this Plan that is more restrictive
than would be permitted by Section 25102(o) as amended from time to time, shall,
without further act or amendment by the Administrator, be reformed to comply
with the requirements of Section 25102(o). If at any time the Administrator
determines that the delivery of Common Stock under the Plan is or may be
unlawful under the laws of any applicable jurisdiction, or federal or state
securities laws, the right to exercise an Award or receive shares of Common
Stock pursuant to an Award shall be suspended until the Administrator determines
that such delivery is lawful. The Company shall have no obligation to effect any
registration or qualification of the Common Stock under federal or state laws.
The Company may require that a grantee, as a condition to exercise of
an Award, and as a condition to the delivery of any share certificate, make such
written representations (including representations to the effect that such
person will not dispose of the Common Stock so acquired in violation of federal
or state securities laws) and furnish such information as may, in the opinion of
counsel for the Company, be appropriate to permit the Company to issue the
Common Stock in compliance with applicable federal and state securities laws.
The stock certificates for any shares of Common Stock issued pursuant to this
Plan may bear a legend restricting transferability of the shares of Common Stock
unless such shares are registered or an exemption from registration is available
under the Securities Act of 1933, as amended, and applicable state securities
laws.
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(j) [Same as Plan]
(k) [Same as Plan]
(l) [Same as Plan]
(m) Financial Statements. The Company will provide financial statements
to each Award recipient annually during the period such individual has Awards
outstanding, or as otherwise required under Section 260.140.46 of Title 10 of
the California Code of Regulations. Notwithstanding the foregoing, the Company
will not be required to provide such financial statements to Award recipients
when issuance is limited to key employees whose services in connection with the
Company assure them access to equivalent information.
(n) Voting Rights. The Company will comply with Section 260.140.1 of
Title 10 of the California Code of Regulations with respect to the voting rights
of Common Stock.
8. TERMINATION OF EMPLOYMENT OR SERVICE.
(a) Exercise Period Following Cessation of Employment or Service, In
General. If an optionee's employment or other service relationship with the
Company is terminated voluntarily by the optionee for any reason (excluding
death or total and permanent disability (as defined in Section 8(b) below)), (i)
the optionee's stock options granted hereunder shall terminate immediately upon
such cessation of relationship to the extent of any unvested shares and (ii) the
optionee's stock options granted hereunder shall be exercisable during the
30-day period, or such longer period as may be specified in the relevant grant
agreement, following such cessation of relationship with respect to any vested
shares, but in no event after the expiration date. Unless sooner terminated,
stock options granted hereunder shall terminate upon the expiration of such
30-day or longer-specified period, as applicable.
If the optionee's employment or other service relationship
with the Company is terminated involuntarily by the Company for any reason other
than death, total and permanent disability (as defined in Section 8(b) below) or
discharge for "Cause" (as defined in Section 8(d) below), (i) the optionee's
stock options granted hereunder shall terminate immediately upon such cessation
of relationship to the extent of any unvested shares and (ii) the optionee's
stock options granted hereunder shall be exercisable during the 90-day period,
or such longer period as may be specified in the relevant grant agreement,
following such cessation of relationship with respect to any vested shares, but
in no event after the expiration date. Unless sooner terminated, stock options
granted hereunder shall terminate upon the expiration of such 90-day or
longer-specified period, as applicable.
(b) Disability of Optionee. Notwithstanding the provisions of Section
8(a) above, if the optionee ceases his employment or other service relationship
with the Company as a result of his or her total and permanent disability, (i)
the optionee's stock options granted hereunder shall terminate immediately upon
such cessation to the extent of any unvested shares and (ii) the optionee's
stock options granted hereunder shall be exercisable during the 180-day period,
or such longer period as may be specified in the relevant grant agreement,
following such cessation with respect to any vested shares, but in no event
after the expiration date. Unless sooner terminated, stock options granted
hereunder shall terminate upon the expiration of such 180-day or
longer-specified period, as applicable.
For purposes of this Plan, "total and permanent disability"
shall mean the inability to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be
expected to result in death or which has lasted or can be expected to last for a
continuous period of not less than twelve months. The Administrator may require
such proof of total and permanent disability as the
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Administrator in its sole discretion deems appropriate and the Administrator's
good faith determination as to whether the optionee is totally and permanently
disabled shall be final and binding on all parties concerned.
(c) Death of Optionee. If the optionee dies prior to the expiration
date or other termination of a stock option granted hereunder, (i) the
optionee's stock options granted hereunder shall terminate immediately upon the
optionee's death to the extent of any unvested shares and (ii) the optionee's
stock options granted hereunder shall be exercisable during the one-year period
following the death of the optionee with respect to any vested shares, but in no
event after the expiration date, by the optionee's executor, personal
representative, or the person(s) to whom the option is transferred by will or
the laws of descent and distribution. Unless sooner terminated, the optionee's
stock options granted hereunder shall terminate upon the expiration of such
one-year period.
(d) Cause. Notwithstanding anything to the contrary herein, an
optionee's stock options granted hereunder shall terminate in their entirety,
regardless of whether such options are vested in whole or in part, immediately
upon the optionee's discharge of employment or other service relationship by the
Company for Cause. For purposes of this Agreement, if the optionee is a party to
a written employment agreement or other service agreement with the Company which
contains a definition of "cause", "termination for cause" or any other similar
term or phrase, whether the optionee is terminated for Cause pursuant to this
Section 8 shall be determined according to the terms of and in a manner
consistent with the provisions of such written agreement. If the optionee is not
party to such a written employment agreement or other service agreement with the
Company, then for purposes of this Section 8, "Cause" shall mean (i) conviction
of, or plea of nolo contendere to, a felony or crime involving moral turpitude;
(ii) fraud on or misappropriation of any funds or property of the Company; (iii)
personal dishonesty, incompetence, willful misconduct, willful violation of any
law, rule or regulation (other than minor traffic violations or similar
offenses) or breach of fiduciary duty which involves personal profit; (iv)
willful misconduct in connection with the optionee's duties or willful failure
to perform his responsibilities in the best interests of the Company; (v) breach
of any provision of any employment, non-disclosure, non-competition,
non-solicitation or other similar agreement executed by the optionee for the
benefit of the Company. The good faith determination by the Administrator of
whether the optionee's employment or other service relationship was terminated
by the Company for Cause shall be final and binding for all purposes hereunder.
9. COMPANY'S REPURCHASE OPTION.
At the discretion of the Administrator, the Company may reserve to
itself and/or its assignee(s) in the Grant Agreement or Stock Restriction
Agreement a right to repurchase shares held by an Award recipient following such
Award recipient's termination at any time within ninety (90) days after such
Award recipient's termination date (or in the case of securities issued upon
exercise of an option after the termination date, within ninety (90) days after
the date of such exercise) for cash and/or cancellation of purchase money
indebtedness, at: (A) with respect to vested shares, the Fair Market Value of
such shares on the Award recipient's termination date, provided, that such right
to repurchase vested shares terminates when the Company's securities become
publicly traded; or (B) with respect to unvested shares, the Award recipient's
exercise price, provided, that to the extent the Award recipient is not an
officer, director or consultant of the Company or of a Parent or Subsidiary of
the Company such right to repurchase unvested shares at the exercise price
lapses at the rate of at least twenty percent (20%) per year over five (5) years
from the date of grant of the option.
`
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