As filed with the Securities and Exchange Commission on November 27, 1995
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
MICROCOM, INC.
(Exact name of registrant as specified in its charter)
Massachusetts No. 04-2710644
(State or other jurisdiction (IRS Employer
of incorproation or oganization) Identification No.)
500 River Ridge Drive
Norwood, Massachusetts 02062-5028
(617) 551-1000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Long Term Performance Plan
1993 Non-Employee Director Stock Option Plan
(Full title of plans)
Roland D. Pampel
President and Chief Executive Officer
MICROCOM, INC.
500 River Ridge Drive
Norwood, Massachusetts 02062-5028
(617) 551-1000
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
CALCULATION OF REGISTRATION FEE
Proposed
Title of Proposed Maximum
Securities Maximum Aggregate Amount of
to be Amount to be Offering Price Offering Registration
Registered Registered(1) Per Share(2) Price(2) Fee
___________ _____________ ______________ _________ _____________
Common
Stock, $.01 450,000 $23.9375 $10,771,875 $3,714.44
par value shares
(1) Plus such additional number of shares as may be required
pursuant to the Plan in the event of a stock dividend,
split-up of shares, recapitalization or other similar
change in the Common Stock.
(2) Estimated solely for the purpose of calculating the
registration fee, in accordance with Rule 457(h)(1), on
the basis of the average of the high and low prices of
Microcom, Inc. Common Stock as reported on the Nasdaq
National Market on November 17, 1995.
EXPLANATORY NOTE
This Registration Statement has been prepared in
accordance with the requirements of General Instruction E to Form
S-8, as amended, and relates to (i) 400,000 shares of Common
Stock, $.01 par value per share (the "Common Stock"), of
Microcom, Inc. (the "Company") which represents an increase in
the number of shares reserved for issuance under the Company's
Long Term Performance Plan (the "Performance Plan"), and (ii)
50,000 shares of the Common Stock, which represents an increase
in the number of shares reserved for issuance under the Company's
1993 Non-Employee Director Stock Option Plan (the "1993 Plan").
300,000 shares have been previously registered for issuance under
the Performance Plan, pursuant to a Registration Statement on
Form S-8 (File No. 33-84572). 100,000 shares have previously
been registered for issuance under the 1993 Plan pursuant to a
Registration Statement on Form S-8 (File No. 33-71588).
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
The contents of the Company's previously filed
Registration Statements on Form S-8 (Nos. 33-84572 and 33-71588)
relating to shares issuable under the Performance Plan and the
1993 Plan are hereby incorporated by reference.
Item 8. Exhibits
5.1 Opinion of Choate, Hall & Stewart
10.1 Registrant's 1993 Non-Employee Director
Stock Option Plan (As Amended and Restated
Effective as of March 17, 1995)
10.2 Registrant's Long Term Performance Plan
(As Amended and Restated Effective as of
April 13, 1995)
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Choate, Hall & Stewart
(included in Exhibit 5.1)
24.1 Power of Attorney (included in page II-3)
II-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Company certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing a Form S-8 and
has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the Town
of Norwood, The Commonwealth of Massachusetts on November 17,
1995.
Microcom, Inc.
(Issuer and Employer)
By: Roland D. Pampel,
President and Chief Executive Officer
II-2
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose
signature appears below constitutes and appoints Roland D.
Pampel, Peter J. Minihane and William C. Rogers, jointly and
severally, his true and lawful attorneys-in-fact and agents with
full powers of substitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this registration
statement, and to file the same, with all exhibits thereto, and
all documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and
perform each and every act and thing requisite and necessary to
be in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do
or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below on November
17, 1995 by the following persons in the capacities indicated.
Signature Capacity
Roland D. Pampel President, Chief
Executive Officer and Director
(Principal Executive Officer)
Peter J. Minihane Executive Vice President, Chief
Financial Officer and Treasurer
(Principal Financial Officer
and Principal Accounting Officer)
James M. Dow Chairman of the Board
Donald G. Kennedy Director
John C. Rutherford Director
Michael I. Schneider Director
II-3
INDEX TO EXHIBITS
Exhibit Number Page
5.1 Opinion of Choate, Hall & Stewart
10.1 Registrant's 1993 Non-Employee Director
Stock Option Plan (As Amended and Restated
Effective as of March 17, 1995)
10.2 Registrant's Long Term Performance Plan
(As Amended and Restated Effective as of
April 13, 1995)
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Choate, Hall & Stewart
(included in Exhibit 5.1)
24.1 Power of Attorney (included in page II-3)
II-4
Exhibit 5.1
Choate, Hall & Stewart
A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS
Exchange Place
53 State Street
Boston, Massachusetts 02109-2891
Telephone (617)248-5000
Facsimile (617) 248-4000
Telex 49615860
November 27, 1995
Microcom, Inc.
500 River Ridge Drive
Norwood, Massachusetts 02062-5028
Gentlemen:
This opinion is delivered to you in connection with the
registration statement on Form S-8 (the "Registration Statement")
to be filed on November 27, 1995 by Microcom, Inc. (the
"Company") under the Securities Act of 1933, as amended, for
registration under said Act of 450,000 shares of common stock,
$.01 par value (the "Common Stock"), of the Company.
We are familiar with the Company's Articles of Organization,
as amended, its By-Laws, as amended, and its corporate minute
book as well as the Registration Statement. We have also
examined such other documents, records and certificates and made
such further investigation as we have deemed necessary for the
purposes of this opinion.
Based upon and subject to the foregoing, we are of the
opinion that the 400,000 shares of Common Stock to be sold by the
Company under its Long Term Performance Plan and the 50,000
shares of Common Stock to be sold under its 1993 Non-Employee
Director Stock Option Plan, each as in effect on the date hereof,
when issued against receipt of the agreed purchase price
therefor, will be legally issued, fully paid and nonassessable.
We understand that this opinion is to be used in connection
with the Registration Statement and consent to the filing of this
opinion as an exhibit to the Registration Statement. We further
consent to the reference to this firm in the section entitled
"Interests of Named Experts and Counsel".
Very truly yours,
CHOATE, HALL & STEWART
Exhibit 10.1
MICROCOM, INC.
1993 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
(As Amended and Restated Effective March 17, 1995)
______________
Section 1. Purpose of Plan
The purpose of this Microcom, Inc. 1993 Non-Employee
Director Stock Option Plan ("Plan") is to enable Microcom, Inc.
(the "Company") to attract and retain non-employee directors and
further align their interests with those of the shareholders by
providing for or increasing their equity interests in the
Company.
Section 2. Administration
This Plan shall be administered by the Board of Directors of
the Company (the "Board") or by the Compensation Committee
appointed by the Board (the "Committee"). In the event the Board
refrains from delegating administration of this Plan to the
Committee, the Board shall have all power and authority to
administer this Plan. In such event, the word "Committee"
wherever used herein shall be deemed to mean the Board. The
Committee shall, subject to the provisions of the Plan, have the
power to construe this Plan, to determine all questions
hereunder, and to adopt and amend such rules and regulations for
the administration of this Plan as it may deem desirable.
Section 3. Persons Eligible Under Plan
Each member of the Board who is not an employee of the
Company or any of its subsidiaries (a "Non-Employee Director")
shall be eligible for the grant of Options (as hereinafter
defined) under this Plan.
Section 4. Available Shares
The total number of shares of Common Stock, par value $.01
per share, of the Company ("Common Shares"), for which options
may be granted under this Plan shall not exceed 150,000 shares,
subject to adjustment as provided in Section 6 hereof. Shares
subject to this Plan are authorized but unissued Common Shares or
Common Shares that were once issued and subsequently reacquired
by the Company. If any Options (as hereinafter defined) granted
under this Plan are surrendered before exercise or lapse without
exercise, in whole or in part, the Common Shares reserved
therefor shall continue to be available under this Plan.
Section 5. Options
(a) Initial Grants. Each person who is a Non-Employee
Director shall, on March 17, 1995 without further action by the
Board or the Committee, automatically be granted an option
("Option") to purchase 16,000 Common Shares, subject to
adjustment as provided in Section 6 hereof. In addition, each
person who first becomes a Non-Employee Director after March 17,
1995 shall, on the date such person becomes a Non-Employee
Director, without further action by the Board or Committee,
automatically be granted an Option to purchase 16,000 Common
Shares, subject to adjustment as provided in Section 6 hereof.
(b) Annual Grants. On April 15, 1996 and on April 15 of
each succeeding year during the term of this Plan, or, if
April 15 shall not be a business day, the business day
immediately preceding such date, each person who is a Non-
Employee Director shall without further action by the Board or
Committee automatically be granted an Option to purchase 4,000
Common Shares, subject to adjustment as provided in Section 6
hereof.
(c) Insufficient Shares. Notwithstanding the foregoing,
if, on any date upon which Options are to be granted under
Section 5(a) or (b) hereof, the number of Common Shares remaining
available for issuance under this Plan is insufficient for the
grant of Options to purchase the total number of Common Shares
specified in such section, then each Non-Employee Director
entitled to receive an Option on such date shall be granted an
Option to purchase a proportionate amount of the available number
of Common Shares (rounded down to the greatest number of whole
shares). Except for the specific Options referred to in Section
5(a) and (b) above, no other Options shall be granted under this
Plan.
(d) Option Price and Terms. Each Option shall be evidenced
by a written option agreement that shall contain the following
terms and provisions:
(i) The exercise price per Common Share shall be equal to
the Fair Market Value (as hereinafter defined) of one Common
Share on the date of grant of such Option. If, at the time
an Option is granted the Company's Common Shares are
publicly traded, "Fair Market Value" shall be determined as
of the last business day for which the prices or quotes
discussed in this sentence are available prior to the date
such Option is granted and shall mean (i) the average (on
that date) of the high and low prices of the Common Shares
on the principal national securities exchange on which the
Common Shares are traded, if the Common Shares are then
traded on a national securities exchange; or (ii) the last
reported sale price (on that date) of the Common Shares on
the Nasdaq National Market System, if the Common Shares are
not then traded on a national securities exchange; or (iii)
the closing bid price (or average of bid prices) last quoted
(on that date) by an established quotation service for
over-the-counter securities, if the Common Shares are not
then reported on the Nasdaq National Market System or on a
national securities exchange. If, at the time an Option is
granted under the Plan, the Company's Common Shares are not
publicly traded, "Fair Market Value" shall be the fair
market value on the date the Option is granted as determined
by the Committee in good faith.
(ii) Payment of the exercise price of the Option shall
be made in full in cash or by check concurrently with the
exercise of the Option.
(iii) The Option shall be nontransferable by the
optionee other than by will or the laws of descent and
distribution, and shall be exercisable during the optionee's
life time only by the optionee or the optionee's guardian or
legal representative.
(iv) Options granted pursuant to this Section 5 shall
be immediately exercisable and shall expire upon the first
to occur of the following:
(A) the third anniversary of the date upon which
the optionee shall cease to be Non-Employee Director,
or
(B) the tenth anniversary of the date of grant.
(v) Shares issued upon exercise of an Option granted
hereunder which are unvested shall be subject to repurchase
by the Company, at the Company's election, at a price equal
to the exercise price of the Option if the optionee either
(A) ceases to be a Non-Employee Director for any reason
whatsoever other than death or permanent disability or (B)
proposes to sell or otherwise transfer such shares. Shares
shall vest and become free of the Company's repurchase right
in accordance with the following:
(a) shares issued upon exercise of an Option granted
pursuant to Section 5(a) shall vest in three annual
installments of 32%, 33% and 35% on the first, second and
third anniversaries, respectively, of the date of grant;
(b) shares issued upon exercise of an Option granted
pursuant to Section 5(b) shall vest in full on the first
anniversary of the date of grant; and
(c) shares issued upon exercise of any Option granted
under the Plan to an optionee who ceases to be a Non-
Employee Director due to death of permanent disability shall
be fully vested upon such cessation of service.
Within 30 days of the date of notice from the Company of
exercise of its repurchase rights, the shares to be
repurchased shall be transferred by the optionee to the
Company against payment by the Company of the purchase price
specified above. If the Company shall fail to exercise its
repurchase rights within 120 days of the date the optionee
ceases to serve as a Non-Employee Director, the repurchase
rights with respect to the shares imposed by this Section
5(v) shall terminate and the optionee may thereafter
transfer the shares, subject, however, to such other
restrictions on transfer as may then exist thereon. If an
optionee fails to comply with any of the provisions of this
Section 5(v), the Company, at its option, and in addition to
its other remedies, may suspend the rights of the optionee
to vote or receive dividends on the shares or may refuse to
register on its books any transfer of the shares or
otherwise recognize any transfer or change in the ownership
of the shares or in the right to vote thereon, until the
provisions of this Section are complied with to the
satisfaction of the Company.
(vi) Such other terms and conditions, not inconsistent
with the terms of this Plan, as the Committee shall include
in the written option agreement.
Section 6. Adjustments
(a) Stock Dividends, Recapitalization, Etc. If the
outstanding securities of the class then subject to this Plan are
increased, decreased or exchanged for or converted into a
different number or kind of securities of the Company, or if
cash, property or securities are distributed in respect of such
outstanding securities, in either case as a result of a
reorganization, merger, consolidation, recapitalization,
restructuring, reclassification, dividend (other than a regular
cash dividend) or other distribution, stock split, reverse stock
split or the like, then, unless the terms of such transaction
shall provide otherwise, the Committee shall make appropriate and
proportionate adjustments in (i) the number and type of shares or
other securities or cash or other property that may be acquired
pursuant to Options theretofore granted under this Plan, and
(ii) the maximum number and type of shares or other securities
that may be issued pursuant to Options thereafter granted under
this Plan.
(b) Merger, Sale of Assets, Etc. If the Company is merged
into or consolidated with another corporation under circumstances
where the Company is not the surviving corporation or if the
Company is liquidated or sells or otherwise disposes of all or
substantially all of its assets while unexercised Options remain
outstanding under the Plan, as of the date thirty (30) days prior
to such transaction (i) all outstanding Options shall become
fully vested and exercisable in full, and (ii) any Options which
remain unexercised as of the day prior to the effective date of
the transaction shall be cancelled as of such day and shall not
thereafter be exercisable by anyone; provided that the
accelerated exercisability of Options shall be contingent on
completion of the transaction and shall be null and void if the
transaction is not consummated; and provided, further, that
accelerated exercisability pursuant to this provision shall not
extend the expiration date for any Option determined pursuant to
Section 5.
Section 7. Amendment and Termination of Plan
The Board may amend or terminate this Plan at any time and
in any manner, subject to the following:
(a) no such amendment or termination shall deprive the
recipient of any Option theretofore granted under this Plan,
without the consent of such recipient, of any of his or her
rights thereunder or with respect thereto; and
(b) Section 5 hereof shall not be amended more than once
every six months other than to comport with changes in the
Internal Revenue Code, the Employee Retirement Income Security
Act of 1974, or the rules thereunder.
Section 8. Effective Date and Duration of Plan
The Plan became effective on April 21, 1993, the date it was
originally adopted by the Board, and was approved by stockholders
on July 15, 1993. This amendment and restatement of the Plan was
approved by the Board effective March 17, 1995 and was approved
by stockholders on July 20, 1995. This Plan shall terminate and
no Options shall be granted hereunder after April 15, 2003.
Exhibit 10.2
MICROCOM, INC.
LONG TERM PERFORMANCE PLAN
(As Amended and Restated Effective as of April 13, 1995)
______________
1. PURPOSE
The purpose of this Microcom, Inc. Long Term Performance
Plan (the "Plan") is to advance the interests of Microcom, Inc.
(the "Company") by enabling the Company to attract and retain
officers, executives and other key employees, and reward them for
making major contributions to the success of the Company. This
purpose is accomplished by making stock and cash awards under the
Plan, thereby providing Participants with a proprietary interest
in the growth and performance of the Company and cash bonuses to
recognize and reward their performance.
2. DEFINITIONS
(a) "Award" shall mean the grant of any form of stock
option, stock appreciation right, stock, or cash award, whether
granted singly, in combination or in tandem, to a Participant
pursuant to such terms, conditions, performance requirements,
restrictions and limitations as the Committee may establish in
order to fulfill the purpose of the Plan.
(b) "Award Agreement" shall mean a written plan document
adopted by the Company or a written agreement between the Company
and a Participant that sets forth the terms, conditions,
performance requirements, restrictions and limitations applicable
to an Award.
(c) "Board" shall mean the Board of Directors of the
Company.
(d) "Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
(e) "Committee" shall mean the committee designated by
the Board to administer the Plan. The Committee shall consist
solely of two or more outside directors, within the meaning of
Section 162(m) of the Code, and shall be constituted to permit
the Plan to comply with Rule 16b-3 promulgated under the
Securities Exchange Act of 1934 or any successor rule. No member
of the Committee may receive Awards under the Plan.
(f) "Common Stock" or "Stock" shall mean authorized and
issued or unissued $0.01 par value Common Stock of the Company.
(g) "Company" shall mean Microcom, Inc. and its
subsidiaries including subsidiaries of subsidiaries and
partnerships and other business ventures in which Microcom, Inc.
has a significant equity interest, as determined in the sole
discretion of the Committee.
(h) "Fair Market Value" shall mean the value of Common
Stock as determined in accordance with procedures established in
good faith by the Committee and, with regard to incentive stock
options, in conformity with the Code and regulations with regard
to incentive stock options.
(i) "Participant" shall mean an employee of the Company
to whom an Award has been made under the Plan.
3. ELIGIBILITY
Awards may be granted to such officers, executives and key
employees of the Company who hold positions of responsibility and
who in the judgment of the Committee or the management of the
Company can have a significant effect on the success of the
Company.
4. STOCK AVAILABLE FOR AWARDS
The number of shares that may be issued under the Plan for
Awards granted wholly or partly in Stock is 700,000 (the "Share
Limit"). Included in the Share Limit are Awards denominated in
units of Stock that may be redeemed or exercised for cash as well
as for Stock. Also included in the Share Limit are shares of
Stock withheld by the Company in connection with the exercise of
any stock option or other Award to satisfy tax withholding
requirements or to pay the exercise price of such stock options
or Awards. Stock related to Awards that are forfeited,
terminated, expire unexercised, or settled in such manner that
all or some of the shares covered by an Award are not issued to a
Participant, or are exchanged for Awards that do not involve
Stock, shall immediately become available for Awards and will not
be included within the Share Limit; provided, in the case of
shares reacquired by the Company pursuant to a repurchase right,
the holder thereof did not receive any benefits with respect to
the ownership thereof other than voting rights.
5. ADMINISTRATION
The Plan shall be administered by the Committee, which shall
have full and exclusive power to interpret the Plan, and to adopt
such rules, regulations and guidelines for carrying out the Plan
as it may deem necessary or proper, all of which powers shall be
executed in the best interests of the Company and in keeping with
the purpose of the Plan. These powers include, but are not
limited to, designating the Participants, designating the Awards
made to each Participant, establishing performance goals and
subplans, establishing vesting and exercisability restrictions,
and waiving any or all restrictions previously attached to any
Award. These powers include the adoption of modifications,
amendments, procedures, subplans and the like as are necessary to
comply with provisions of the laws and regulations of the
countries in which the Company operates in order to assure the
viability of Awards granted under the Plan and to enable
Participants regardless of where employed to receive advantages
and benefits under the Plan and such laws and regulations.
6. DELEGATION OF AUTHORITY
The Committee may delegate to the chief executive officer
and to other senior officers of the Company its duties under the
Plan pursuant to such conditions or limitations as the Committee
may establish, except that only the Committee may select, and
grant Awards to, Participants who are subject to Section 16 of
the Securities Exchange Act of 1934 ("Section 16 Persons").
7. AWARDS
The Committee shall determine the type or types of Award(s)
to be made to each Participant and shall set forth in the related
Award Agreement the terms, conditions, performance requirements,
and limitations applicable to each Award. Awards may include but
are not limited to those listed in this Section 7. Awards may be
granted singly, in combination or in tandem. Awards may also be
made in combination or in tandem with, in replacement of, or as
alternatives to, grants or rights under any other employee plan
of the Company, including the plan of any acquired entity. Any
other provision hereof notwithstanding, no Participant shall be
granted within any fiscal year of the Company Awards of stock
options or SAR's the aggregate of which shall exceed 100,000
shares.
(a) Stock Options. A stock option is the grant by the
Company to a Participant of a right to purchase a specified
number of shares of Stock the purchase price of which shall be
not less than 100% of Fair Market Value on the date of grant of
such right, as determined by the Committee. A stock option may
be in the form of (i) a nonqualified option which shall be
subject to terms, conditions and limitations established by the
Committee or (ii) an incentive stock option ("ISO") which, in
addition to being subject to applicable terms, conditions and
limitations established by the Committee, complies with Section
422 of the Code which, among other limitations, provides that the
aggregate Fair Market Value (determined at the time the option is
granted) of Stock for which ISO's are exercisable for the first
time by a Participant during any calendar year shall not exceed
$100,000; that ISO's shall be priced at not less than 100% of the
Fair Market Value on the date of the grant; and that ISO's shall
be exercisable for a period of not more than ten years.
(b) Stock Appreciation Rights. A stock appreciation
right ("SAR") is a right of a Participant to receive from the
Company a payment, in cash and/or Stock, equal to the excess of
the Fair Market Value of a specified number of shares of Stock on
the date the SAR is exercised over the Fair Market Value on the
date of grant of the SAR, as set forth in the Award Agreement.
(c) Stock Award. An Award may be made in shares of
Stock or denominated in units of Stock. All or part of any Stock
Award may be subject to terms, conditions and limitations
established by the Committee, and set forth in the Award
Agreement, which may include, but are not limited to, continuous
service with the Company, achievement of specific individual,
divisional or Company-wide business objectives, increases in
specified indices, attaining financial growth rates, and other
comparable measurements of performance. When transfer of Stock
is so restricted or subject to forfeiture provisions, it is
referred to as "Restricted Stock."
(d) Cash Award. An Award may be denominated in cash
with the eventual payment amount subject to future service and
such other restrictions and conditions established by the
Committee and set forth in the Award Agreement, including, but
not limited to, continuous service with the Company, achievement
of specific individual, divisional or Company-wide business
objectives, increases in specified indices, attaining financial
growth rates, and other comparable measurements of performance.
8. PAYMENT OF AWARDS
Payment of Awards may be made in the form of cash, Stock, or
combinations thereof, and may include such restrictions as the
Committee shall determine, including in the case of Stock,
restrictions on transfer and forfeiture provisions. If the
Committee specifies in the Award Agreement, payment of Awards
shall be deferred, either in the form of installments or as a
future lump sum payment. The Committee may permit Participants
to elect to defer payments of some or all types of Awards in
accordance with procedures established by the Committee which are
intended to permit such deferrals to comply with applicable
requirements of the Code including, at the choice of the
Participant, the capability to make further deferrals for payment
after retirement. Any deferred payment, whether elected by the
Participant or specified by the Award Agreement, may require the
payment to be forfeited in accordance with the provisions of
Section 13 of the Plan. Dividends or dividend equivalent rights
may be extended to and made a part of any Award denominated in
Stock or units of Stock, subject to such terms, conditions and
restrictions as the Committee may establish. The Committee may
also establish rules and procedures for the crediting of interest
on deferred cash payments and dividend equivalents for deferred
payments denominated in Stock or units of Stock. At the
discretion of the Committee, a Participant may be offered an
election to substitute an Award for another Award or Awards of
the same or different type.
9. STOCK OPTION EXERCISE
The price at which shares of Stock may be purchased under a
Stock Option shall be paid in full at the time of the exercise in
cash or, if permitted by the Committee, by means of tendering
Stock or surrendering another Award, including Restricted Stock,
valued at Fair Market Value on the date of exercise, or any
combination thereof. The Committee shall determine acceptable
methods for tendering Common Stock or other Awards and may impose
such conditions on the use of Common Stock or other Awards to
exercise a stock option as it deems appropriate. In the event
shares of Restricted Stock are tendered as consideration for the
exercise of a stock option, a number of the shares issued upon
the exercise of the stock option, equal to the number of shares
of Restricted Stock used as consideration therefor, shall be
subject to the same restrictions as the Restricted Stock so
submitted plus any additional restrictions that may be imposed by
the Committee.
10. TAX WITHHOLDING
The Company shall have the right to deduct applicable taxes
from any Award payment and withhold, at the time of delivery or
vesting of shares under the Plan, an appropriate number of shares
for payment of taxes required by law or to take such other action
as may be necessary in the opinion of the Company to satisfy all
obligations for withholding of such taxes; provided that with
respect to Section 16 Persons the Company shall in all cases
where tax withholding is required with respect to such
Participants, withhold shares of Stock having a value equal to
such withholding obligation. If Stock or Restricted Stock is
used to satisfy tax withholding, such Stock shall be valued based
on the Fair Market Value when the tax withholding is required to
be made.
11. AMENDMENT, MODIFICATION, SUSPENSION OR
DISCONTINUANCE OF THE PLAN
The Board may amend, modify, suspend or terminate the Plan
for the purpose of meeting or addressing any changes in legal
requirements or for any other purpose permitted by law. Subject
to changes in law or other legal requirements that would permit
otherwise, the Plan may not be amended without the approval of
the shareholders, to (i) increase the aggregate number of shares
of Common Stock that may be issued under the Plan (except for
adjustments pursuant to Section 15 of the Plan), (ii) decrease
the option price to less than 100% of Fair Market Value for stock
options or SAR's, or (iii) materially modify the requirements as
to eligibility for participation in the Plan.
12. TERMINATION OF EMPLOYMENT
If the employment of a Participant terminates, other than
pursuant to paragraphs (a) or (b) of this Section 12, all
unexercised, deferred and unpaid Awards shall be cancelled
immediately, unless the Award Agreement provides otherwise.
(a) Retirement Under a Company
Retirement Plan. When a Participant's employment terminates as a
result of retirement in accordance with the terms of a Company
retirement plan, the Committee (in the form of an Award Agreement
or otherwise) may permit Awards to continue in effect beyond the
date of retirement in accordance with the applicable Award
Agreement and the exercisability and vesting of any Award may be
accelerated.
(b) Death or Disability of a Participant.
(i) In the event of a Participant's death, the
Participant's estate or beneficiaries shall have a period of one
year from the date of the Participant's death, or other period
specified in the Award Agreement, within which to receive or
exercise any outstanding Award held by the Participant to the
extent such Award was exercisable by the Participant on the date
of his death, provided that no Award shall be exercisable by
anyone after the termination date otherwise applicable to the
Award. Rights to any such outstanding Awards shall pass by will
or the laws of descent and distribution in the following order:
(1) to beneficiaries so designated by the Participant; if none,
then (2) to a legal representative of the Participant; if none,
then (3) to the persons entitled thereto as determined by a court
of competent jurisdiction. Subject to subparagraph (iii) below,
Awards so passing shall be exercised or paid out at such times
and in such manner as if the Participants were living.
(ii) In the event a Participant is deemed by the
Company to be disabled, Awards and rights to any such Awards may
be paid to or exercised by the Participant, if legally competent,
or a committee or other legally designated guardian or
representative if the Participant is legally incompetent by
virtue of such disability; in the event of the Participant's
disability the Participant (or such legally designated guardian)
shall have a period of one year after the Participant ceases to
perform services on account of disability, or other period
specified in the Award Agreement, within which to receive or
exercise any outstanding Award held by the Participant to the
extent such Award was exercisable by the Participant on the date
he ceased to perform services, provided that no Award shall be
exercisable by anyone after the termination date otherwise
applicable to the Award.
(iii) After the death or disability of a Participant,
the Committee may in its sole discretion at any time
(1) terminate restrictions in Award Agreements; (2) accelerate
any or all installments and rights: and (3) instruct the Company
to pay the total of any accelerated payments in a lump sum to the
Participant, the Participant's estate, beneficiaries or
representative, notwithstanding that, in the absence of such
termination of restrictions or acceleration of payments, any or
all of the payments due under the Awards might ultimately have
become payable to other beneficiaries.
(iv) In the event of uncertainty as to
interpretation of or controversies concerning this paragraph (b)
of Section 12, the Committee's determination shall be binding and
conclusive.
13. CANCELLATION AND RESCISSION OF AWARDS
Unless the Award Agreement specifies otherwise, the Committee
may cancel any unexpired, unpaid, or deferred Awards at any time
if the Participant is not in compliance with all other applicable
provisions of the Award Agreement, the Plan and with the
following conditions:
(a) A Participant shall not render
services for any organization or engage directly or indirectly in
any business which, in the judgment of the chief executive
officer of the Company or other senior officer designated by the
Committee, is or becomes competitive with the Company, or which
organization or business, or the rendering of services to such
organization or business, is or becomes otherwise prejudicial to
or in conflict with the interests of the Company. For a
Participant whose employment has terminated, the judgment of the
chief executive officer shall be based on the Participant's
position and responsibilities while employed by the Company, the
Participant's post-employment responsibilities and position with
the other organization or business, the extent of past, current
and potential competition or conflict between the Company and the
other organization or business, the effect on the Company's
customers, suppliers and competitors of the Participant's
assuming the post-employment position, and such other
considerations as are deemed relevant given the applicable facts
and circumstances.
(b) A Participant shall not,
without prior written authorization from the Company, disclose to
anyone outside the Company, or use in other than the Company's
business, any confidential information or material relating to
the business of the Company, acquired by the Participant either
during or after employment with the Company.
(c) A Participant shall disclose
promptly and assign to the Company all right, title, and interest
in any invention or idea, patentable or not, made or conceived by
the Participant during employment by the Company, relating in any
manner to the actual or anticipated business, research or
development work of the Company and shall do anything reasonably
necessary to enable the Company to secure a patent where
appropriate in the United States and in other countries.
(d) Upon exercise, payment or
delivery pursuant to an Award, the Participant shall certify on a
form acceptable to the Committee that he or she is in compliance
with the terms and conditions of the Plan. Failure to comply
with the provisions of paragraph (a), (b) or (c) of this Section
13 prior to, or during the six months after, any exercise,
payment or delivery pursuant to an Award shall cause such
exercise, payment or delivery to be rescinded. The Company shall
notify the Participant in writing of any such rescission within
two years after such exercise, payment or delivery. Within ten
days after receiving such a notice from the Company, the
Participant shall pay to the Company the amount of any gain
realized or payment received as a result of the rescinded
exercise, payment or delivery pursuant to an Award. Such payment
shall be made either in cash or by returning to the Company the
number of shares of Stock that the Participant received in
connection with the rescinded exercise, payment or delivery.
(e) Nothing in the Plan shall interfere with or limit in
any way the right of the Company to terminate any Participant's
employment at any time, for any reason or no reason in the
Company's sole discretion, nor confer upon any Participant any
right to continue in the employ of the Company. For purposes of
the Plan, transfer of employment of a Participant between the
Company and any one of its subsidiaries (or between subsidiaries)
shall not be deemed a termination of employment.
(f) No employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to
be selected to receive a future Award.
14. NON-TRANSFERABILITY
Unless the Award Agreement specifies otherwise, no Award
shall be transferable by a Participant otherwise than by will or
by the laws of descent and distribution and each Award shall be
exercisable during a Participant's lifetime only by him.
15. ADJUSTMENTS
In the event of any change in the outstanding Stock of the
Company by reason of a stock split, stock dividend, combination
or reclassification of shares, recapitalization, merger, or
similar event, the Committee may adjust proportionally (a) the
number of shares of Stock (i) reserved under the Plan,
(ii) available for ISO's, (iii) for which Awards may be granted
to an individual Participant, and (iv) covered by outstanding
Awards denominated in Stock or units of Stock; (b) the Stock
prices related to outstanding Awards; and (c) the appropriate
Fair Market Value and other price determinations for such Awards.
In the event of any other change affecting the Stock or any
distribution (other than normal cash) to holders of Stock, such
adjustments as may be deemed equitable by the Committee,
including adjustments to avoid fractional shares, shall be made
to give proper effect to such event. In the event of a corporate
merger, consolidation, acquisition of property or stock,
reorganization or liquidation, the Committee is authorized to
issue or assume stock options, whether or not in a transaction to
which Section 424(a) of the Code applies, by means of
substitution of new stock options for previously issued stock
options or an assumption of previously issued stock options.
If the Company is merged into or consolidated with another
corporation under circumstances where the Company is not the
surviving corporation, or if the Company is liquidated or sells
or otherwise disposes of substantially all of its assets to
another corporation while Awards remain outstanding under the
Plan, (i) subject to the provisions of clauses (iii), (iv) and
(v) below, after the effective date of such merger, consolidation
or sale, as the case may be, each holder of an outstanding Award
shall be entitled, upon exercise of such Award, to receive in
lieu of Stock of the Company, shares of such stock or other
securities as the holders of Stock received pursuant to the terms
of the merger, consolidation or sale; or (ii) the Committee may
waive any discretionary limitations imposed with respect to the
exercise of the Award so that all Awards from and after a date
prior to the effective date of such merger, consolidation,
liquidation or sale, as the case may be, specified by the
Committee, shall be exercisable or payable in full; or (iii) all
outstanding Awards may be cancelled by the Committee as of the
effective date of any such merger, consolidation, liquidation or
sale provided that notice of such cancellation shall be given to
each holder of an Award, and each such holder thereof shall have
the right to exercise such Award in full (without regard to any
discretionary limitations imposed with respect to the Award)
during a 30-day period preceding the effective date of such
merger, consolidation, liquidation or sale; or (iv) all
outstanding Awards may be cancelled by the Committee as of the
date of any such merger, consolidation, liquidation or sale
provided that notice of such cancellation shall be given to each
holder of an Award, and each such holder thereof shall have the
right to exercise such Award but only to the extent exercisable
in accordance with any discretionary limitations imposed with
respect to the Award prior to the effective date of such merger,
consolidation, liquidation or sale; or (v) the Committee may
provide for the cancellation of all outstanding Awards and for
the payment to the holders thereof some part or all of the amount
by which the value thereof exceeds the payment, if any, which the
holder would have been required to make to exercise such Award.
16. NOTICE
Any notice to the Company required by any of the provisions
of the Plan shall be addressed to the chief financial officer of
the Company in writing, and shall become effective when it is
received by the chief financial officer.
17. UNFUNDED PLAN
Insofar as it provides for Awards of cash and Stock, the Plan
shall be unfunded. Although bookkeeping accounts may be
established with respect to Participants who are entitled to
cash, Stock or rights thereto under the Plan, any such accounts
shall be used merely as a bookkeeping convenience. The Company
shall not be required to segregate any assets that may at any
time be represented by cash, Stock or rights thereto, nor shall
the Plan be construed as providing for such segregation, nor
shall the Company or the Board or the Committee be deemed to be a
trustee of any cash, Stock or rights thereto to be granted under
the Plan. Any liability of the Company to any Participant with
respect to a grant of cash, Stock or rights thereto under the
Plan shall be based solely upon any contractual obligations that
may be created by the Plan and any Award Agreement; no such
obligation of the Company shall be deemed to be secured by any
pledge or other encumbrance on any property of the Company.
Neither the Company nor the Board nor the Committee shall be
required to give any security or bond for the performance of any
obligation that may be created by the Plan.
18. GOVERNING LAW
The Plan and all determinations made and actions taken
pursuant hereto, to the extent not otherwise governed by the laws
of the United States, shall be governed by the laws of The
Commonwealth of Massachusetts and construed accordingly.
19. EFFECTIVE AND TERMINATION DATES
The Plan became effective on June 8, 1994, the date it was
adopted by the Board, and was approved by stockholders on July
21, 1994. This amendment and restatement of the Plan was
approved by the Board effective April 13, 1995 and was approved
by the stockholders on July 20, 1995. The Plan shall terminate
ten years after the date it is initially adopted by the Board,
subject to earlier termination by the Board pursuant to Section
11, after which no Awards may be made under the Plan, but any
such termination shall not affect Awards then outstanding or the
authority of the Committee to continue to administer the Plan.
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our
report dated April 11, 1995 included in Microcom, Inc.'s 1995
Annual Report to Stockholders for the year ended March 31, 1995
and all references to our firm included in this registration
statement.
Arthur Andersen LLP
Boston, Massachusetts
November 20, 1995
