As filed with the Securities and Exchange Commission on September 16, 1998
Registration No. ___________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
WORLDPORT COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 84-1127336
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1825 BARRETT LAKES BLVD., SUITE 100
KENNESAW, GEORGIA 30144
(Address of principal executive offices) (Zip code)
WORLDPORT COMMUNICATIONS, INC.
AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN
(Full title of each plan)
PAUL A. MOORE (770) 792-8735
CHIEF EXECUTIVE OFFICER (Telephone number,
1825 BARRETT LAKES BLVD., SUITE 100 including area code,
KENNESAW, GEORGIA 30144 of agent for service)
(Name and address of agent for service)
CALCULATION OF REGISTRATION FEE
PROPOSED PROPOSED
TITLE OF AMOUNT TO MAXIMUM MAXIMUM AMOUNT OF
SECURITIES BE OFFERING AGGREGATE REGISTRATI
TO BE REGISTERED PRICE PER OFFERING ON FEE
REGISTERED SHARE(1) PRICE(1)
Common Stock 7,500,000 $11.875 $89,062,500 $26,274
(par value shares(2)
$.0001 per
share)
(1) Estimated solely for purposes of calculating the amount of the
registration fee pursuant to Rule 457 of the Securities Act of
1933, based on the average of the high and low sales prices of a
share of Common Stock of the Registrant on the Nasdaq Over-the-
Counter Market on September 11, 1998.
(2) An undetermined number of additional shares may be issued if the
anti-dilution adjustment provisions of the plan become operative.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents previously filed by WorldPort Communications,
Inc., a Delaware corporation (the "Company") with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference.
1. The Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1997, filed with the Commission on March 31, 1998, as
amended by Form 10-KSB/A filed with the Commission on May 15, 1998 and by
Form 10-KSB/A-2 filed with the Commission on September 8, 1998.
2. The Company's Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1998, filed with the Commission on May 15, 1998.
3. The Company's Quarterly Report on Form 10-QSB for the quarter
ended June 30, 1998, filed with the Commission on August 14, 1998, as
amended by Form 10-QSB/A filed with the Commission on September 9, 1998.
4. The Company's Current Report on Form 8-K dated June 25, 1998,
filed with the Commission on July 9, 1998, as amended by Form 8-K/A filed
with the Commission on August 13, 1998 and the Company's Current Report on
Form 8-K dated August 3, 1998, filed with the Commission on August 13,
1998.
In addition, all reports and other documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in this registration statement and to be part hereof from the date of
filing of such documents (such documents, and the documents enumerated above,
being hereinafter referred to as "Incorporated Documents").
Any statement contained in an Incorporated Document shall be deemed to be
modified or superseded for purposes of this registration statement to the extent
that a statement contained herein or in any other subsequently filed
Incorporated Document modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this registration statement.
ITEM 4. DESCRIPTION OF SECURITIES.
The Company is authorized to issue 65,000,000 shares of Common Stock,
$.0001 par value per share. As of June 30, 1998, 17,140,713 shares of the Common
stock were issued and outstanding. In addition to its Common Stock, the Company
is authorized to issue 10,000,000 shares of Preferred Stock, $.0001 par value
per share. As of June 30, 1998, 493,889 shares of the Company's Series A
Preferred Stock, and 3,000,000 shares of the Series B Convertible Preferred
Stock were issued and outstanding.
The holders of Common Stock are entitled to one vote for each share held of
record on each matter submitted to a vote of stockholders and to vote on all
matters on which a vote of stockholders is taken, except as otherwise provided
by statute. The shares of Common Stock do not have cumulative voting rights
with respect to the election of directors. Holders of Common Stock are entitled
receive such dividends as may be declared by the Board of Directors out of funds
legally available therefor, and in the event of liquidation, dissolution or
winding up of the Company, are entitled to share ratably in all assets remaining
after payment of liabilities. The Company's Certificate of Incorporation
prohibits the Company from paying dividends on the Common Stock if the Company
is not current in its dividend payments on its Preferred Stock. The Preferred
Stock will rank prior to the Common Stock and any other class or series of
common stock as to the payment of dividends and distributions upon liquidation,
dissolution or winding up. The shares of Common Stock are not subject to
liability for calls or assessments and have no conversion rights, sinking fund
privileges or preemptive rights.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Certain legal matters in connection with the securities registered hereby
will be passed upon for the Company by McDermott, Will & Emery. Certain
partners of McDermott, Will & Emery own an aggregate of 173,750 shares of the
Company's common stock, par value $.0001 per share.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to the Company's Certificate of Incorporation and under Delaware
law, directors of the Company are not liable to the Company or its stockholders
for monetary damages for breach of fiduciary duty, except for liability in
connection with a breach of duty of loyalty, for acts or omissions not in good
faith or which involve intentional misconduct or knowing violation of law, for
dividend payments or stock repurchases illegal under Delaware law or any
transaction in which a director has derived an improper personal benefit.
The Company's Certificate of Incorporation provides for indemnification of
existing and former directors, advisory directors, officers, employees and
agents of the Company against any loss, claim, damage, expense, fee or
liability, whether joint or several, incurred by each of them, including but not
limited to all legal fees, judgments, penalties or amounts paid in defense,
settlement or compromise, all of which may arise or be incurred, rendered or
levied in any legal action, or administrative proceeding brought or threatened
against any of them by reason of the fact that such person is or was a director,
advisory director, officer, employee or agent of the Company.
The Company's By-Laws provide that the Company shall, to the fullest extent
permitted by Section 145 of the General Corporation Law of the State of
Delaware, as amended from time to time, indemnify its officers and directors as
permitted pursuant thereto. The Company's By-Laws also provide that the Company
will indemnify each of the authorized representatives of the Company who neither
is nor was a director or officer of the Company to the extent such an individual
has been successful on the merits or otherwise in defense of any actions for
which directors or officers would be entitled to indemnification. The Company
also maintains liability insurance for the benefit of its directors and
officers.
In addition, employment agreements between the Company and certain of its
executive officers provide that the Company will indemnify such executives
against any loss, liability or cost (including, but not limited to, reasonable
attorney's fees) sustained, incurred or assumed as a result of any claims
arising out of such executives' employment with the Company. Such
indemnification, however, will not apply in cases of bad faith, gross negligence
or willful misconduct by the executives.
Section 145 of the General Corporation Law of the Sate of Delaware, as
amended, permits a corporation, under specified circumstances, to indemnify its
directors, officers, employees or agents against expenses (including attorneys'
fees), judgments, fines and amount paid in settlements actually and reasonably
incurred by them in connection with any action, suit or proceeding brought by
third parties by reason of the fact that they were or are directors, officers,
employees or agents of the corporation, if such directors, officers, employees
or agents acted in good faith and in a manner they reasonably believed to be in
or not opposed to the best interest of the corporation and, with respect to any
criminal action or proceeding, had no reason to believe their conduct was
unlawful. In an action by or in the right of the corporation, indemnification
may be made only for expenses actually and reasonably incurred by directors,
officers, employees or agents in connection with the defense or settlement of an
action or suit, and only with respect to a matter as to which they shall have
acted in good faith and in a manner they reasonably believed to be in or not
opposed to the best interest of the corporation, except that no indemnification
shall be made if such person shall have been adjudged liable to the corporation,
unless and only to the extent that the Delaware Court of Chancery or the court
in which the action or suit was brought shall determine upon application that
the defendant directors, officers, employees or agents are fairly and reasonably
entitled to indemnification for such expenses despite such adjudication of
liability.
ITEM 8. EXHIBITS.
The exhibits required by Item 601 of Regulation S-K are listed in the
Exhibit Index hereto.
ITEM 9. UNDERTAKINGS.(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
registration statement. Notwithstanding the foregoing, any increase or
decrease in the volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in this registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(l)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been advised
that in the opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Company of expenses incurred or paid by a director, officer
or controlling person of the Company in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized on September 11, 1998.
WORLDPORT COMMUNICATIONS, INC.
By: /s/ Paul A. Moore
Paul A. Moore
Chairman and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Paul A. Moore and Phillip S.
Magiera, and each of them, his true and lawful attorney-in-fact and agent, each
with full power of substitution and revocation, for him and in his name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this registration statement, and to file the same
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto each such attorney-in-fact and
agent, full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and purposes as such
person might or could do in person, hereby ratifying and confirming all that
said attorney-in-fact and agent or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement and the foregoing power of attorney have been signed by
the following persons in the capacities and on the dates indicated:
SIGNATURE TITLE DATE
/s/ Paul A. Moore Chief Executive
Paul A. Moore Officer and Chairman September 11, 1998
of the Board of
Directors
(Principal Executive
Officer)
/s/ Phillip S. Magiera Chief Financial
Phillip S. Magiera Officer and Director September 11, 1998
(Principal Financial
Officer)
/s/ Donald Hilbert Controller
Donald Hilbert (Principal Accounting September 11, 1998
Officer)
/s/ Peter Howley Director
Peter Howley September 11, 1998
/s/ Robert McCann Director
Robert McCann September 11, 1998
EXHIBIT INDEX
EXHIBIT DESCRIPTION OF EXHIBIT
NUMBER
5.1 Opinion of McDermott, Will & Emery as to the legality of the
securities being registered.
10.1 WorldPort Communications, Inc. Amended and Restated Long-Term
Incentive Plan.
23.1 Consent of McDermott, Will & Emery (included in its opinion filed as
Exhibit 5).
23.2 Consent of Arthur Andersen LLP.
24 Power of Attorney (included with the signature page to this
registration statement).
Exhibit 5.1
Board of Directors
WorldPort Communications, Inc.
1825 Barrett Lakes Blvd., Suite 100
Kennesaw, Georgia 30144
Re: Registration Statement on Form S-8; 7,500,000 shares of Common Stock
to be issued pursuant to Amended and Restated Long-Term Incentive Plan
Gentlemen:
You have requested our opinion in connection with the above-referenced
Registration Statement on Form S-8 (the "Registration Statement") of WorldPort
Communications, Inc. (the "Company"), to be filed with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, to register
7,500,000 shares of the common stock of the Company, $.0001 par value (the
"Common Stock"), which may be issued pursuant to the Company's Amended and
Restated Long-Term Incentive Plan (the "Plan").
We have examined or considered:
1. A copy of the Company's Certificate of Incorporation, as amended.
2. The By-Laws of the Company.
3. Telephonic confirmation of the Secretary of State of Delaware, as
of a recent date, as to the good standing of the Company in that state.
4. Copies of resolutions duly adopted by the Board of Directors of
the Company relating to the Plan.
5. Copies of the forms of option underlying the Plan.
In addition to the examination outlined above, we have conferred with
various officers of the Company and have ascertained or verified, to our
satisfaction, such additional facts as we deemed necessary or appropriate for
the purposes of this opinion. In our examination, we have assumed the
authenticity of all documents submitted to us as originals, the conformity to
the original documents of all documents submitted to us as copies, the
genuineness of all signatures on documents reviewed by us and the legal capacity
of natural persons.
Based on the foregoing, we are of the opinion that all corporate
proceedings necessary for the authorization, issuance and delivery of the Common
Stock under the Plan have been duly taken and upon acquisition pursuant to the
terms of the Plan, the Common Stock will be validly issued, fully paid and
nonassessable.
Members of our firm are admitted to the practice of law in the State of
Illinois and we express no opinion as to the laws of any jurisdiction other than
the laws of the State of Illinois, the General Corporation Law of the State of
Delaware and the laws of the United Stated of America. This opinion is
furnished to you solely for your benefit in connection with the filing of the
Registration Statement and is not to be used, circulated, quoted or otherwise
referred to for any other purpose without our prior written consent.
Notwithstanding the foregoing, we hereby consent to the references to our firm
in the Registration Statement and to the filing of this opinion by the Company
as an Exhibit to the Registration Statement. In giving this consent, we do not
hereby admit that we come within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the rules
and regulations of the Securities and Exchange Commission thereunder.
/s/ McDERMOTT, WILL & EMERY
Exhibit 10.1
WORLDPORT COMMUNICATIONS, INC.
AMENDED AND RESTATED
LONG-TERM INCENTIVE PLAN
1. Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
3. Definitions and Construction . . . . . . . . . . . . . . . . . . . . . . 1
4. Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5. Shares Subject to the Plan . . . . . . . . . . . . . . . . . . . . . . . 5
6. Eligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7. Stock Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8. Stock Appreciation Rights . . . . . . . . . . . . . . . . . . . . . . . 8
9. Performance Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
10. Restricted Stock Awards . . . . . . . . . . . . . . . . . . . . . . . . 9
11. Dividend Equivalents . . . . . . . . . . . . . . . . . . . . . . . . . 9
12. Other Stock-Based Awards . . . . . . . . . . . . . . . . . . . . . . . 9
13. Provisions Applicable to Awards . . . . . . . . . . . . . . . . . . . 10
14. Changes in Capital Structure . . . . . . . . . . . . . . . . . . . . . 11
15. Amendment, Modification and Termination . . . . . . . . . . . . . . . 12
16. General Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . 12
WORLDPORT COMMUNICATIONS, INC.
AMENDED AND RESTATED
LONG-TERM INCENTIVE PLAN
1. Purpose. The purpose of the WorldPort Communications, Inc. Long-
Term Incentive Plan (the "Plan") is to promote the success, and enhance the
value, of WorldPort Communications, Inc. (the "Company") by linking the personal
interests of its directors, officers, employees and key consultants to those of
Company shareholders and by providing such individuals with an incentive for
outstanding performance. The Plan is further intended to provide flexibility to
the Company in its ability to motivate, attract, and retain the services of
individuals upon whose judgment, interest, and special effort the successful
conduct of the Company's operation is largely dependent. Accordingly, the Plan
permits the grant of incentive awards from time to time to its directors and
selected officers, key employees and outside consultants.
2. Effective Date. The Plan is effective as of October 1, 1996 (the
"Effective Date").
3. Definitions and Construction. When a word or phrase appears in
this Plan with the initial letter capitalized, and the word or phrase does not
commence a sentence, the work or phrase shall generally be given the meaning
ascribed to it in this paragraph or paragraphs 1(a) or 2(a) unless a clearly
different meaning is required by the context. The following words and phrases
shall have the following meanings:
(a) "Award" means an Option, Stock Appreciation Right,
Restricted Stock Award, Performance Share Award, Dividend Equivalent
Award, or Other Stock-Based Award, or any other right or interest
relating to Stock or cash, granted to a Participant under the Plan.
(b) "Award Agreement" means any written agreement,
contract, option form, or other instrument or document evidencing an
Award.
(c) "Board" means the Board of directors of the Company.
(d) "Change of Control" means and includes each of the
following:
(i) A change of control of the Company of a
nature that would be required to be reported in response to
Item 6(e) of Schedule 14A of the 1934 Act regardless of
whether the Company is subject to such reporting
requirement;
(ii) A change of control of the company through a
transaction or series of transactions, such that any person
(as that term is used in Section 13(d) and 14(d) of the 1934
Act), excluding affiliates of the Company as of the
Effective Date, is or becomes the beneficial owner (as that
term is used in Section 13(d) of the 1934 Act) directly or
indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then
outstanding securities;
(iii) Any consolidation or liquidation of the
Company in which the Company is not the continuing or
surviving corporation or pursuant to which shares of Stock
would be converted into cash, securities or other property,
other than a merger of the company in which the holders of
the shares of Stock immediately before the merger have the
same proportionate ownership of common stock of the
surviving corporation immediately after the merger;
(iv) The shareholders of the Company approve any
plan or proposal for the liquidation or dissolution of the
Company; or
(v) Substantially all of the assets of the
Company are sold or otherwise transferred to parties that
are not within a "controlled group of corporations" (as
defined in Section 1563 of the Code) in which the Company is
a member.
The foregoing events shall not be deemed to be a Change of Control if
the transaction or transactions causing such change shall have been
approved by the affirmative vote of at least a majority of the members
of the Board in office as of the Effective Date ("Incumbents"), those
serving on the Board pursuant to nomination or appointment thereto by
a majority of Incumbents ("Successors"), and those serving on the
Board pursuant to nomination or appointment thereto by a majority of a
Board composed of Incumbents and/or Successors.
(e) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(f) "Committee" means the committee of the Board described
in paragraph 4.
(g) "Disability" shall mean any illness or other physical
or mental condition of a Participant which renders the Participant
incapable of performing his customary and usual duties for the
Company, or any medically determinable illness or other physical or
mental condition resulting from a bodily injury, disease or mental
disorder which in the judgment of the Committee is permanent and
continuous in nature. The Committee may require such medical or other
evidence as it deems necessary to judge the nature and permanency of
the Participant's condition.
(h) "Dividend Equivalent" means a right granted to a
Participant under paragraph 11.
(i) "Fair Market Value" means with respect to Stock or any
other property, the fair market value of such Stock or other property
determined by such methods or procedures as may be established from
time to time by the Committee. Unless otherwise determined by the
Committee, the Fair Market Value of the Stock as of any date shall be
the closing price for the Stock as reported on the Nasdaq National
Market System (or on any national securities exchange on which the
Stock is then listed) for that date or, if no closing price is so
reported for that date, the closing price on the next preceding date
for which a closing price was reported.
(j) "Incentive Stock Option" means an Option that is
intended to meet the requirements of Section 422 of the Code or any
successor provision thereto.
(k) "Non-Qualified Stock Option" means an Option that is
not intended to be an Incentive Stock Option.
(l) "Option" means a right granted to a Participant under
paragraph 7 of the Plan to purchase Stock at a specified price during
specified time periods. An Option may be either an Incentive Stock
Option or a Non-Qualified Stock Option.
(m) "Other Stock-Based Award" means a right, granted to a
Participant under paragraph 12, that relates to or is valued by
reference to Stock or other Awards relating to Stock.
(n) "Participant" means a person who, as a director,
officer, key employee or outside consultant of the Company or any
Subsidiary, has been granted an Award under the Plan.
(o) "Performance Share" means a right granted to a
Participant under paragraph 9, to receive cash, Stock, or other
Awards, the payment of which is contingent upon achieving certain
performance goals established by the Committee.
(p) "Plan" means the WorldPort Communications, Inc. Long-
Term Incentive Plan, as amended from time to time.
(q) "Restricted Stock Award" means Stock granted to a
Participant under paragraph 10 that is subject to certain restrictions
and to risk of forfeiture.
(r) "Retirement" means a Participant's termination of
employment with the Company after attaining any normal or early
retirement age specified in any pension, profit sharing or other
retirement program sponsored by the Company.
(s) "Stock" means the common stock of the Company and such
other securities of the Company that may be substituted for Stock
pursuant to paragraph 12.
(t) "Stock Appreciation Right" or "SAR" means a right
granted to a Participant under paragraph 8 to receive a payment equal
to the difference between the Fair Market Value of a share of Stock as
of the date of exercise of the SAR over the grant price of the SAR,
all as determined pursuant to paragraph 8.
(u) "Subsidiary" means any corporation of which a majority
of the outstanding voting stock or voting power is beneficially owned
directly or indirectly by the Company.
4. Administration.
(a) Committee. The Plan will be administered by the Compensation
Committee (the "Committee") appointed by the Board of Directors of the Company
from among its members provided, however, that as long as shares of the Stock
are registered under the Securities Exchange Act of 1934, members of the
Committee must qualify as non-employee directors within the meaning of
Securities and Exchange Commission Regulation Section 240.16b-3.
(b) Action by the Committee. A majority of the Committee shall
constitute a quorum. The acts of a majority of the members present at any
meeting at which a quorum is present and acts approved in writing by a majority
of the Committee in lieu of a meeting shall be deemed the acts of the Committee.
Each member of the Committee is entitled to, in good faith, rely or act upon any
report or other information furnished to that member by any officer or other
employee of the Company or any Subsidiary, the Company's independent certified
public accountants, or any executive compensation consultant or other
professional retained by the Company to assist in the administration of the
Plan.
(c) Authority of Committee. The Committee has the exclusive
power, authority and discretion to:
(i) Designate Participants;
(ii) Determine the type or types of Awards to be granted to
each Participant;
(iii) Determine the number of Awards to be granted and the
number of shares of Stock to which an Award will relate;
(iv) Determine the terms and conditions of any Award granted
under the Plan including but not limited to, the exercise price, grant
price, or purchase price, any restrictions or limitations on the
Award, any schedule for lapse of forfeiture restrictions or
restrictions on the exercisability of an Award, and accelerations or
waivers thereof, based in each case on such considerations as the
Committee in its sole discretion determines;
(v) Determine whether, to what extent, and under what
circumstances an Award may be settled in, or the exercise price of an
Award may be paid in, cash, Stock, other Awards, or other property, or
an Award may be cancelled, forfeited, or surrendered;
(vi) Prescribe the form of each Award Agreement, which need
not be identical for each Participant;
(vii) Decide all other matters that must be determined in
connection with an Award;
(viii) Establish, adopt or revise any rules and regulations as
it may deem necessary or advisable to administer the Plan; and
(ix) Make all other decisions and determinations that may be
required under the Plan or as the Committee deems necessary or
advisable to administer the Plan.
(d) Decision Binding. The Committee's interpretation of the
Plan, any Awards granted under the Plan, any Award Agreement and all decisions
and determinations by the Committee with respect to the Plan are final, binding,
and conclusive on all parties.
5. Shares Subject to the Plan.
(a) Number of Shares. Subject to adjustment provided in
paragraph 14(a) the aggregate number of shares of Stock reserved and available
for Awards or which may be used to provide a basis of measurement for or to
determine the value of an Award (such as with a Stock Appreciation Right or
Performance Share Award) shall be 7,500,000.
(b) Lapsed Awards. To the extent that an Award terminates,
expires or lapses for any reason, any shares of Stock subject to the Award will
again be available for the grant of an Award under the Plan and shares subject
to SARs or other Awards settled in cash will be available for the grant of an
Award under the Plan.
(c) Stock Distributed. Any Stock distributed pursuant to an
Award may consist, in whole or in part, of authorized and unissued Stock,
treasury Stock or Stock purchased on the open market.
(d) Limitation on Number of Shares Subject to Awards.
Notwithstanding any provision in the Plan to the contrary, the maximum number of
shares of Stock with respect to one or more Awards that may be granted to any
one Participant in any one fiscal year shall be 1,000,000.
6. Eligibility. Awards may be granted only to individuals who are
directors, officers, key employees or outside consultants of the Company or a
Subsidiary, as determined by the Committee.
7. Stock Options.
(a) General. The Committee is authorized to grant Options to
Participants on the following terms and conditions:
(i) Exercise Price. The exercise price per share of Stock
under an Option shall be determined by the Committee, provided that
the exercise price for any Option shall not be less than the Fair
Market Value as of the date of grant or, with respect to Non-Qualified
Stock Options, a price which reflects a reasonable discount from the
Fair Market Value, as determined by the Committee;
(ii) Time and Conditions of Exercise. The Committee shall
determine the time or times at which an Option may be exercised in
whole or in part. The Committee also shall determine the performance
or other conditions, if any, that must be satisfied before all or part
of an Option may be exercised;
(iii) Payment. The Committee shall determine the methods by
which the exercise price of an Option may be paid, the form of
payment, including, without limitation, cash, shares of Stock, or
other property (including "cashless exercise" arrangements), and the
methods by which shares of Stock shall be delivered or deemed to be
delivered to Participants. Without limiting the power and discretion
conferred on the Committee pursuant to the preceding sentence, the
Committee may, in the exercise of its discretion, but need not, allow
a Participant to pay the Option price by directing the Company to
withhold from the shares of Stock that would otherwise be issued upon
exercise of the Option that number of shares having a Fair Market
Value on the exercise date equal to the Option price, all as
determined pursuant to rules and procedures established by the
Committee;
(iv) Evidence of Grant. All Options shall be evidenced by a
written Award Agreement between the Company and the Participant. The
Award Agreement shall include such provisions as may be specified by
the Committee.
(b) Incentive Stock Options. The terms of any Incentive Stock
Options granted under the Plan must comply with the following additional rules:
(i) Exercise Price. The exercise price per share of Stock
shall be set by the Committee, provided that the exercise price for
any Incentive Stock Option may not be less than the Fair Market Value
as of the date of the grant;
(ii) Exercise. In no event, may any Incentive Stock Option
be exercisable for more than ten years from the date of its grant;
(iii) Lapse of Option. An Incentive Stock Option shall lapse
under the following circumstances:
(1) The Incentive Stock Option shall lapse ten
years after its is granted, unless an earlier time is set in
the Award Agreement;
(2) The Incentive Stock Option shall lapse three
months after the Participant's termination of employment, if
the termination of employment was attributable to (a)
Disability, (b) Retirement, or (c) for any other reason,
provided that the Committee has approved, in writing, the
continuation of any Incentive Stock Option outstanding on
the date of the Participant's termination of employment;
(3) If the Participant separates from employment
other than as provided in paragraph 7(b)(iii)(2), the
Incentive Stock Option shall lapse at the time of the
Participant's termination of employment;
(4) If the Participant dies before the Option
lapses pursuant to paragraph 7(b)(iii)(1), 7(b)(iii)(2) or
7(b)(iii)(3), above, the Incentive Stock Option shall lapse,
unless it is previously exercised, on the earlier of (a) the
date on which the Option would have lapsed had the
Participant lived and had his employment status (i.e.,
whether the Participant was employed by the Company on the
date of his death or had previously terminated employment)
remained unchanged; or (b) 15 months after the date of the
Participant's death. Upon the Participant's death, any
exercisable Incentive Stock Options may be exercised by the
Participant's legal representative or representatives, by
the person or persons entitled to do so under the
Participant's last will and testament, or, if the
Participant shall fail to make testamentary disposition of
such Incentive Stock Option or shall die intestate, by the
person or persons entitled to receive said Incentive Stock
Option under the applicable laws of descent and
distribution.
(c) Individual Dollar Limitation. The aggregate Fair Market
Value (determined as of the time an Award is made) of all shares of Stock with
respect to which Incentive Stock Options are first exercisable by a Participant
in any calendar year may not exceed $100,000.00.
(d) Ten Percent Owners. An Incentive Stock Option shall be
granted to any individual who, at the date of grant, owns stock possessing more
than ten percent of the total combined voting power of all classes of Stock of
the company only if such Option is granted at a price that is not less than 110%
of Fair Market Value on the date of grant and the Option is exercisable for no
more than five years from the date of grant.
(e) Expiration of Incentive Stock Options. No Award of an
Incentive Stock Option may be made pursuant to this Plan after October 1, 2008.
(f) Right to Exercise. During a Participant's lifetime, an
Incentive Stock Option may be exercised only by the Participant.
8. Stock Appreciation Rights.
(a) Grant of SARs. The Committee is authorized to grant SARs to
Participants on the following terms and conditions:
(i) Right to Payment. Upon the exercise of a Stock
Appreciation Right, the Participant to whom it is granted has the
right to receive the excess, if any, of:
(1) The Fair Market Value of one share of Stock
on the date of exercise; over
(2) The grant price of the Stock Appreciation
Right as determined by the Committee, which shall not be
less than the Fair Market Value of one share of Stock on the
date of grant in the case of any SAR related to any
Incentive Stock Option.
(b) Other Terms. All awards of Stock Appreciation Rights shall
be evidenced by an Award Agreement. The terms, methods of exercise, methods of
settlement, form of consideration payable in settlement, and any other terms and
conditions of any Stock Appreciation Right shall be determined by the Committee
at the time of the grant of the Award and shall be reflected in the Award
Agreement.
9. Performance Shares.
(a) Grant of Performance Shares. The Committee is authorized to
grant Performance Shares to Participants on such terms and conditions as may be
selected by the Committee. The Committee shall have the complete discretion to
determine the number of Performance Shares granted to each Participant. All
Awards of Performance Shares shall be evidenced by an Award Agreement;
(b) Right to Payment. A grant of Performance Shares gives the
Participant rights, valued as determined by the Committee, and payable to, or
exercisable by, the Participant to whom the Performance Shares are granted, in
whole or in part, as the Committee shall establish at grant or thereafter. The
Committee shall set performance goals and other terms or conditions to payment
of the Performance Shares in its discretion which, depending on the extent to
which they are met, will determine the number and value of Performance Shares in
its discretion which, depending on the extent to which they are met, will
determine the number and value of Performance Shares that will be paid to the
Participant, provided that the time period during which the performance goals
must be met shall, in all cases, exceed six months;
(c) Other Terms. Performance Shares may be payable in cash,
Stock, or other property, and have such other terms and conditions as determined
by the Committee and reflected in the Award Agreement.
10. Restricted Stock Awards.
(a) Grant of Restricted Stock. The Committee is authorized to
make Awards of Restricted Stock to Participants in such amounts and subject to
such terms and conditions as may be selected by the Committee. All awards of
Restricted Stock shall be evidenced by a Restricted Stock Award Agreement.
(b) Issuance and Restrictions. Restricted Stock shall be
subject to such restrictions on transferability and other restrictions as the
Committee may impose (including, without limitation, limitations on the right to
vote Restricted Stock or the right to receive dividends on the Restricted
Stock). These restrictions may lapse separately or in combination at such
times, under such circumstances, in such installments, or otherwise, as the
Committee determines at the time of the grant of the Award or thereafter;
(c) Forfeiture. Except as otherwise determined by the Committee
at the time of the grant of the Award or thereafter, upon termination of
employment during the applicable restriction period, Restricted Stock that is at
that time subject to restrictions shall be forfeited and reacquired by the
Company, provided, however, that the Committee may provide in any Award
Agreement that restrictions or forfeiture conditions relating to Restricted
Stock will be waived in whole or in part in the event of terminations resulting
from specified causes, and the Committee may in other cases waive in whole or in
part restrictions or forfeiture conditions relating to Restricted Stock;
(d) Certificates for Restricted Stock. Restricted Stock granted
under the Plan may be evidenced in such manner as the committee shall determine.
If certificates representing shares of Restricted Stock are registered in the
name of the Participant, certificates must bear an appropriate legend referring
to the terms, conditions, and restrictions applicable to such Restricted Stock,
and the Company shall retain physical possession of the certificate until such
time as all applicable restrictions lapse.
11. Dividend Equivalents. The Committee is authorized to grant
Dividend Equivalents to Participants subject to such terms and conditions as may
be selected by the Committee. Dividend Equivalents shall entitle the
Participant to receive payments equal to dividends with respect to all or a
portion of the number of shares of Stock subject to an Option Award or SAR
Award, as determined by the Committee. The Committee may provide that Dividend
Equivalents be paid or distributed when accrued or be deemed to have been
reinvested in additional shares of Stock, or otherwise reinvested.
12. Other Stock-Based Awards. The Committee is authorized,
subject to limitations under applicable law, to grant to Participants such other
Awards that are payable in, value in whole or in part by reference to, or
otherwise based on or related to shares of Stock, as deemed by the Committee to
be consistent with the purposes of the Plan, including without limitation shares
of Stock awarded purely as a "bonus" and not subject to any restrictions or
conditions, convertible or exchangeable debt securities, other rights
convertible or exchangeable into shares of Stock, and Awards valued by reference
to book value of shares of Stock or the value of securities of or the
performance of specified Subsidiaries. The Committee shall determine the terms
and conditions of such Awards.
13. Provisions Applicable to Awards.
(a) Stand-Alone, Tandem, and Substitute Awards. Awards granted
under the Plan may, in the discretion of the Committee, be granted either alone
or in addition to, in tandem with, or in substitution for, any other Award
granted under the Plan, if an Award is granted in substitution for another
Award, the Committee may require the surrender of such other Award in
consideration of the grant of the new Award. Awards granted in addition to or
in tandem with other Awards may be granted either at the same time as or at a
different time from the grant of such other Awards;
(b) Exchange Provisions. The Committee may at any time offer to
exchange or buy out any previously granted Award for a payment in cash, Stock,
or another Award (subject to paragraph 13(a), based on the terms and conditions
the Committee determines and communicates to the Participant at the time the
offer is made;
(c) Term of Award. The term of each Award shall be for the
period as determined by the Committee, provided that in no event shall the term
of any Incentive Stock Option or a Stock Appreciation Right granted in tandem
with the Incentive Stock Option exceed a period of ten years from the date of
its grant;
(d) Form of Payment for Awards. Subject to the terms of the
Plan and any applicable law or Award Agreement, payments or transfers to be made
by the Company or a Subsidiary on the grant or exercise of an Award may be made
in such forms as the Committee determines at or after the time of grant,
including without limitation, cash, Stock, other Awards, or other property, or
any combination, and may be made in a single payment or transfer, in
installments, or on a deferred basis, in each case determined in accordance with
rules adopted by, and at the discretion of, the Committee;
(e) Limits on Transfer. No right or interest of a Participant
in any Award may be pledged, encumbered, or hypothecated to or in favor of any
party other than the Company or a subsidiary, or shall be subject to any lien,
obligation, or liability of such Participant to any other party other than the
Company or a Subsidiary. Except as otherwise provided below, no Award shall be
assignable or transferable by a Participant other than by will or the laws of
descent and distribution or, except in the case of an Incentive Stock Option,
pursuant to a court order that would otherwise satisfy the requirements to be a
domestic relations order as defined in Section 414(p)(1)(B) of the Code, if the
order satisfies Section 414(p)(1)(A) of the Code notwithstanding that such an
order relates to the transfer of a stock option rather than an interest in an
employee benefit pension plan. In the Award Agreement for any Award other than
an Award that includes an Incentive Stock Option, the Committee may allow a
Participant to Assign or otherwise transfer all or a portion of the rights
represented by the Award to specified individuals or classes of individuals, or
to a trust benefiting such individuals or classes of individuals, subject to
such restrictions, limitations, or conditions, or conditions as the Committee
deems to be appropriate;
(f) Beneficiaries. Notwithstanding paragraph 13(e), a
Participant may, in the manner determined by the Committee, designate a
beneficiary to exercise rights of the Participant and to receive any
distribution with respect to any Award upon the Participant's death. A
beneficiary, legal guardian, legal representative, or other person claiming any
rights under the Plan is subject to all terms and conditions of the Plan and any
Award Agreement applicable the participant, except to the extent the Plan and
any Award Agreement otherwise provide, and to any additional restrictions deemed
necessary or appropriate by the Committee. If the Participant is married, a
designation of a person other than the Participant's spouse as his beneficiary
with respect to more than 50 percent of the Participant's interest in the Award
shall not be effective without the written consent of the Participant's spouse.
If no beneficiary has been designated or survives the Participant, payment shall
be made to the person entitled thereto under the Participant's will or the laws
of descent and distribution. Subject to the foregoing, a beneficiary
designation may be changed or revoked by a participant at any time provided the
change or revocation is filed with the Committee;
(g) Stock Certificates. All Stock certificates delivered under
the Plan are subject to any stop-transfer orders and other restrictions as the
Committee deems necessary or advisable to comply with federal or state
securities laws, rules and regulations and the rules of any national securities
exchange or automated quotation system on which the Stock is listed, quoted, or
traded. The Committee may place legends on any Stock certificate to reference
restrictions applicable to the Stock;
(h) Tender Offers. In the event of a public tender for all or
any portion of the Stock, or in the event that a proposal to merge, consolidate,
or otherwise combine with another company is submitted for shareholder approval,
the Committee may in its sole discretion declare previously granted Options to
be immediately exercisable. To the extent that this provision causes Incentive
Stock Options to exceed the dollar limitations set forth in paragraph 7(c), the
excess Options shall be deemed to be Non-Qualified Stock Options;
(i) Acceleration Upon a Change of Control. If a Change of
Control occurs, all outstanding Options, Stock Appreciation Rights, and other
Awards in the nature of rights that may be exercised shall become fully
exercisable and all restrictions on outstanding Awards shall lapse.
14. Changes in Capital Structure.
(a) General. In the event a stock dividend is declared upon the
Stock, the shares of Stock then subject to each Award (and the exercise price
relating thereto) shall be adjusted proportionately without any change in the
aggregate purchase price therefor. In the event the Stock shall be changed into
or exchanged for a different number or class of shares of Stock or of another
corporation, whether through reorganization, recapitalization, stock split-up,
combination of shares, merger or consolidation, then, subject to paragraph 14(b)
below, there shall be substituted for each such share of Stock then subject to
each Award the number and class of shares of Stock into which each outstanding
share of Stock shall be so exchanged and the exercise price therefor shall be
adjusted accordingly, all without any change in the aggregate purchase price for
the shares then subject to each Award;
(b) Merger. Subject to the Change of Control provision in
paragraph 13(i), a dissolution or liquidation of the Company or a merger or
consolidation in which the Company is not the surviving or resulting
corporation, shall, in the sole discretion of the Committee:
(i) Cause every Award outstanding hereunder to terminate,
except that the surviving or resulting corporation, in its absolute
and uncontrolled discretion, may tender an option or options to
purchase its shares or exercise such rights on terms and conditions,
as to the number of shares and rights and otherwise, which shall
substantially preserve the rights and benefits of any Award then
outstanding thereunder; or
(ii) Give each Participant the right to exercise Awards
prior to the occurrence of the event otherwise terminating the Awards
over such period as the Committee, in its sole and absolute
discretion, shall determine. To the extent that this provision causes
Incentive Stock Options to exceed the dollar limitation set forth in
paragraph 7(c), the excess Options shall be deemed to be Non-Qualified
Stock Options.
15. Amendment, Modification and Termination. The terms and
conditions applicable to any Award may be amended or modified by mutual
agreement between the Company and the Participant or such other persons as may
then have an interest therein. Also, by mutual agreement between the Company
and a Participant hereunder, under this Plan or under any other present or
future plan of the Company, Awards may be granted to such Participant in
substitution and exchange for, and in cancellation of, any Awards previously
granted such Participant under this Plan, or any other present or future plan of
the Company. The Board of Directors may amend the Plan from time to time or
terminate the Plan at any time. However, no action authorized by this paragraph
15 shall reduce the amount of any existing Award or change the terms and
conditions thereof without the participant's consent. No amendment of the Plan
shall be made without approval of the stockholders of the Company if such
approval is required by law or regulatory authority.
16. General Provisions.
(a) No Rights to Awards. No Participant or employee shall have
any claim to be granted any Award under the Plan, and neither the Company nor
the Committee is obligated to treat Participants and employees uniformly;
(b) No Stockholders Rights. No Award gives the Participant any
of the rights of a shareholder of the Company unless and until shares of Stock
are in fact issued to such person in connection with such Award;
(c) Withholding. The Company or any Subsidiary shall have the
authority and the right to deduct or withhold, or require a Participant to remit
to the Company, an amount sufficient to satisfy Federal, state, and local taxes
(including the Participant's FICA obligation) required by law to be withheld
with respect to any taxable event arising as a result of this Plan. With
respect to withholding required upon any taxable event under the Plan,
Participants may elect, subject to the Committee's approval, to satisfy the
withholding requirement, in whole or in part, by having the Company or any
Subsidiary withhold shares of Stock having a Fair Market Value on the date of
withholding equal to the amount to be withheld for tax purposes in accordance
with such procedures as the Committee establishes. The Committee may, at the
time any Award is granted, require that any and all applicable tax withholding
requirements be satisfied by the withholding of shares of Stock as set forth
above;
(d) No Right to Employment. Nothing in the Plan or any Award
Agreement shall interfere with or limit in any way the right of the Company or
any Subsidiary to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continue in the employ of the Company or any
Subsidiary;
(e) Unfunded Status of Awards. The Plan is intended to be an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments not yet made to a Participant pursuant to an Award, nothing contained
in the Plan or any Award Agreement shall give the Participant any rights that
are greater than those of a general creditor of the Company or any Subsidiary;
(f) Indemnification. To the extent allowable under applicable
law, each member of the Committee or of the Board shall be indemnified and held
harmless by the Company from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by such member in connection with or
resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action or failure
to act under the Plan and against and from any and all amounts paid by him or
her in satisfaction of judgment in such action, suit, or proceeding against him
or her provided he or she gives the Company an opportunity, at its own expense,
to handle and defend the same before he or she undertakes to handle and defend
it on his or her own behalf. The foregoing right of indemnification shall not
be exclusive of any other rights of indemnification to which such persons may be
entitled under the Company's Articles of Incorporation or Bylaws, as a matter of
law, or otherwise, or any power that the Company may have to indemnify them or
hold them harmless;
(g) Relationship to Other Benefits. No payment under the Plan
shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or other benefit
plan of the Company or any Subsidiary;
(h) Expenses. The expenses of administering the Plan shall be
borne by the Company and its Subsidiaries;
(i) Titles and Headings. The titles and headings of the
paragraphs in the Plan are for convenience of reference only, and in the event
of any conflict, the text of the Plan, rather than such titles or headings,
shall control;
(j) Fractional Shares. No fractional shares of stock shall be
issued and the Committee shall determine, in its discretion, whether cash shall
be given in lieu of fractional shares or whether such fractional shares shall be
eliminated by rounding up;
(k) Securities Law Compliance. With respect to any person who
is, on the relevant date, obligated to file reports under Section 16 of the 1934
Act, transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the 1934 Act. To the extent
any provision of the Plan or action by the Committee fails to so comply, it
shall be void to the extent permitted by law and voidable as deemed advisable by
the Committee;
(l) Government and Other Regulations. The obligation of the
Company to make payment of awards in Stock or otherwise shall be subject to all
applicable laws, rules, and regulations, and to such approvals by government
agencies as may be required. The company shall be under no obligation to
register under the Securities Act of 1933, as amended (the "1933 Act"), any of
the shares of Stock paid under the Plan. If the shares paid under the Plan may
in certain circumstances be exempt from registration under the 1933 Act, the
Company may restrict the transfer of such shares in such manner as it deems
advisable to ensure the availability of any such exemption;
(m) Governing Law. The Plan and all Award Agreements shall be
construed in accordance with and governed by the laws of the State of Delaware.
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference of our reports dated March 30, 1998 included in WorldPort
Communication, Inc.'s Annual Report on Form 10-K/SB for the year ending
December 31, 1997 into this Registration Statement.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
September 15, 1998
