Exhibit 10.23
SUPPLEMENTAL STOCK OPTION AGREEMENT
AGREEMENT made effective as of the 7th day of October, 1999 ("Effective
Date") between GlobeNet Communications Group Limited, a Bermuda company (the
"Company") and Xxxxx X. XxXxxxxxx ("Executive").
In consideration of the mutual agreements and other matters set forth
herein, the Company and Employee hereby agree as follows:
1. Grant of Option. The Company hereby irrevocably grants to Executive
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the right and option ("Option") to purchase all or any part of an aggregate of
49,019 shares of authorized but unissued common shares of the Company, par value
U.S. $1.50 ("Shares"), on the terms and conditions set forth herein. This
Option shall not be treated as an incentive stock option within the meaning of
section 422(b) of the U.S. Internal Revenue Code of 1986, as amended (the
"Code").
2. Option Price. The purchase price of Shares purchased pursuant to the
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exercise of this Option shall be U.S. $20.40 per share ("Option Price").
3. Exercise of Option. This Option may be exercised in whole or in part,
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by written notice to the Company at its principal executive office addressed to
the attention of its General Counsel, at any time after the date of grant
hereof, but it must be exercised within three months of the Effective Date.
This Option shall not be exercisable in any event after the expiration of
three months from the Effective Date. The purchase price of shares as to which
this Option is exercised shall be paid in full at the time of exercise in cash
(including check, bank draft or money order payable to the order of the
Company). No fraction of a Share shall be issued by the Company upon exercise
of this Option; rather, Executive shall provide a cash payment for such amount
as is necessary to effect the issuance and acceptance of only whole Shares.
Unless and until a certificate or certificates representing such shares shall
have been issued by the Company to Executive, Executive shall not be or have any
of the rights or privileges of a shareholder of the Company with respect to
shares acquirable upon an exercise of this Option.
4. Administration. The Board of Directors of the Company (the "Board")
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shall have such powers and authorities related to the administration of this
Agreement as are consistent with the Company's memorandum of association and
bye-laws and applicable law. The Board shall have full power and authority to
take all actions and to make all determinations required or provided for under
this Agreement, and shall have full power and authority to take all such other
actions and determinations not inconsistent with the specific terms and
provisions of this Agreement that the Board deems to be necessary or appropriate
to the administration of this Agreement. All such actions and determinations
shall be by an affirmative majority vote of the Board or by unanimous consent of
the Board executed in writing in accordance with the Company's memorandum of
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association and bye-laws and applicable law. The interpretation and construction
by the Board of any provision of this Agreement shall be final and conclusive.
The Board from time to time may appoint a Committee (the "Committee"). The
Board, in its sole discretion, may provide that the role of the Committee shall
be limited to making recommendations to the Board concerning any determinations
to be made and actions to be taken by the Board pursuant to or with respect to
this Agreement, or the Board may delegate to the Committee such powers and
authorities related to the administration and implementation of this Agreement,
as set forth in the preceding paragraph and in other applicable provisions, as
the Board shall determine, consistent with the Company's memorandum of
association and bye-laws and applicable law. In the event that this Agreement
provides for any action to be taken by or determination to be made by the Board,
such action may be taken by or such determination may be made by the Committee
if the power and authority to do so has been delegated to the Committee by the
Board as provided for in this Section. Unless otherwise expressly determined by
the Board, any such action or determination by the Committee shall be final,
binding and conclusive.
5. Status of Shares. Executive understands that at the time of the
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execution of this Agreement the Shares to be issued upon exercise of this Option
have not been registered under the U.S. Securities Act of 1933, as amended, any
Canadian securities laws, or other applicable securities laws ("Securities
Laws"). Until the Shares acquirable upon the exercise of this Option have been
registered for issuance under Securities Laws, the Company will not issue such
Shares unless the holder of this Option provides the Company, at its request,
with a written opinion of legal counsel, who shall be satisfactory to the
Company, addressed to the Company and satisfactory in form and substance to the
Company's counsel, to the effect that the proposed issuance of such Shares to
such Option holder may be made without registration under Securities Laws. In
the event exemption from registration under Securities Laws is available upon an
exercise of this Option, Executive (or the person permitted to exercise this
Option in the event of Executive's death), if requested by the Company to do so,
will execute and deliver to the Company in writing an agreement containing such
provisions as the Company may require to assure compliance with Securities Laws.
If the Executive is an employee of the Company at the time the aforesaid opinion
is provided to the Company, the Company shall bear the legal fees incurred by
the Executive in connection with the preparation of said opinion.
Executive agrees that the Shares which Executive may acquire by exercising
this Option shall be acquired for investment without a view to distribution,
within the meaning of Securities Laws, and shall not be sold, transferred,
assigned, pledged or hypothecated in the absence of an effective registration
statement for the Shares under Securities Laws or an applicable exemption from
the registration requirements of Securities Laws. Executive also agrees that
the Shares which Executive may acquire by exercising this Option will not be
sold or otherwise disposed of in any manner which would constitute a violation
of any Securities Laws.
In addition, Executive agrees (i) that the certificates representing the
Shares purchased under this Option may bear such legend or legends as the Board
deems appropriate in order to assure compliance with Securities Laws and (ii)
that the Company may refuse to register the transfer of the Shares purchased
under this Option in the register of members of the Company if such proposed
transfer would in the opinion of counsel satisfactory to the Company constitute
a
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violation of any Securities Law and that the Company may give related
instructions to its transfer agent, if any, to stop registration of the transfer
of such Shares.
6. Employment Relationship. For purposes of this Agreement, Executive
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shall be considered to be in the employment of the Company as long as Executive
remains an employee of either the Company, a parent or subsidiary corporation of
the Company, or a company or a parent or subsidiary of such company assuming or
substituting a new option for this Option. Any question as to whether and when
there has been a termination of such employment, and the cause of such
termination, shall be determined pursuant to the Employment Agreement effective
as of October 1, 1999 by and between Executive and Company.
7. Transferability of Options. This Option shall, during an Executive's
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lifetime, be exercisable only by the Executive, and neither this Option nor any
right hereunder shall be transferable by the Executive, by operation of law or
otherwise. Except as may be provided in this Agreement, this Option shall not
be charged, mortgaged, pledged or hypothecated (by operation of law or
otherwise) or subject to execution, attachment or similar processes.
8. Effect of Changes in Capitalization.
(a) Changes in Shares. If the number of outstanding Shares is
increased or decreased or the Shares are changed into or exchanged for a
different number or kind of shares or other securities of the Company as a
result of any recapitalization, reclassification, share split, reverse
split, combination of Shares, exchange of Shares, Share dividend or other
distribution payable in share capital, or other increase or decrease in
such Shares effected without receipt of consideration by the Company
occurring after the Effective Date, the number and kinds of Shares for
which this Option is outstanding shall be adjusted proportionately and
accordingly so that the proportionate interest of the Executive immediately
following such event shall, to the extent practicable, be the same as
immediately before such event. Any such adjustment in this Option shall not
change the aggregate Option Price payable with respect to Shares that are
subject to this Option but shall include a corresponding proportionate
adjustment in the Option Price per Share.
(b) Reorganization in which the Company is the Surviving or
Continuing Entity and in which no Change of Control Occurs. Subject to the
following paragraph hereof, if the Company shall be the surviving or
continuing entity in any reorganization, merger, amalgamation, or
consolidation of the Company with one or more other entities, this Option
shall pertain to and apply to the securities to which a holder of the
number of Shares subject to such Option would have been entitled
immediately following such reorganization, merger, amalgamation, or
consolidation, with a corresponding proportionate adjustment of the Option
Price per Share so that the aggregate Option Price thereafter shall be the
same as the aggregate Option Price of the Shares remaining subject to the
Option immediately prior to such reorganization, merger, amalgamation, or
consolidation.
(c) Adjustments. Adjustments under this Section 8 related to
Shares or securities of the Company shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive. No
fractional Shares or other securities shall be issued pursuant to
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any such adjustment, and any fractions resulting from any such adjustment
shall be eliminated in each case by rounding downward to the nearest whole
Share.
(d) No Limitations on Company. The granting of this Option
shall not affect or limit in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations, or changes of its
capital or business structure or to merge, amalgamate, consolidate,
dissolve, or liquidate, or to sell or transfer all or any part of its
business or assets.
9. Withholding of Tax. To the extent that the exercise of this Option or
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the disposition of Shares acquired by exercise of this Option results in
compensation income to Executive for tax purposes, Executive shall deliver to
the Company at the time of such exercise or disposition such amount of money as
the Company may require to meet its obligation under applicable tax laws or
regulations, and, if Executive fails to do so, the Company is authorized to
withhold from any cash or Shares remuneration then or thereafter payable to
Executive any tax required to be withheld by reason of such resulting
compensation income. Upon an exercise of this Option, the Company is further
authorized in its discretion to satisfy any such withholding requirement out of
any cash or Shares distributable to Executive upon such exercise.
10. Binding Effect. This Agreement shall be binding upon and inure to the
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benefit of any successors to the Company and all persons lawfully claiming under
Executive.
11. Governing Law. This Agreement shall be governed by, and construed in
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accordance with, the laws of Bermuda.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed by its officer thereunto duly authorized, and Executive has executed
this Agreement, all as of the day and year first above written.
GLOBENET COMMUNICATIONS GROUP LIMITED
By: /s/ Xxxxxxx Xxxxx
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/s/ Xxxxx X. XxXxxxxxx
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Xxxxx X. XxXxxxxxx
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