Document:

Exhibit
10.1

 

Description
of Stay Bonus Program

 

The stay bonus program
was put in place by the Board of Managers as a means of retaining certain
employees as the Company announced it was pursuing strategic alternatives.  Thirty-three employees, including executive
officers of the Company, are eligible to participate for a maximum aggregate
payout of approximately $980,000.  Mr.
Robert A. Peterson, the Company’s President and Chief Executive Officer and Mr.
David F. Myers, Jr., the Company’s Executive Vice President and Chief Financial
Officer, are not eligible to participate. 
Payments are triggered upon a change of control of NSP Holdings L.L.C.,
with change of control being defined as a transfer of 66 2/3% or more of the
voting equity of the Company or substantially all of the Company’s assets.  There is no written documentation of this
plan.  Employees are eligible to receive
between 1.5 and 5 months’ salary upon a change of control, with individual
awards determined by the Board of Managers.Exhibit 10.22

 

DATALINK CORPORATION

AMENDED AND RESTATED

2000 DIRECTOR STOCK
OPTION PLAN

 (as amended and restated on April 13,
2004, incorporating amendments effective

April 4,
2001, May 2, 2002, October 15, 2002 and April 13, 2004)

 

Section 1.                                          Purpose

 

The purposes
of the Plan are to assist the Company in (1) promoting a greater identity of
interests between the Company’s non-employee directors and its shareholders,
and (2) attracting and retaining directors by affording them an opportunity to
share in the future successes of the Company.

 

Section 2.                                          Definitions

 

“Act”
shall mean the Securities Exchange Act of 1934, as amended.

 

“Board”
shall mean the Board of Directors of the Company.

 

“Change of
Control” shall mean the happening of any of the following events:

 

(i)                                     An
acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Act) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Act) of 20%
or more of either (1) the then outstanding shares of Common Stock (the “Outstanding
Company Common Stock”) or (2) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting Securities”);  excluding, however, the following:  (1) any acquisition directly from the
Company, other than an acquisition by virtue of the exercise of a conversion
privilege unless the security being so converted was itself acquired from the
Company, (2) any acquisition by the Company, (3) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company or (4) any acquisition by any
Person pursuant to a transaction which complies with clauses (1), (2) and (3)
of subsection (iii) of this definition; 
or

 

(ii)                                  A
change in the composition of the Board such that the individuals who, as of the
Effective Date of the Plan, constitute the Board (such Board shall be
hereinafter referred to as the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board; 
provided, however, for purposes of this definition, that any individual
who becomes a member of the Board subsequent to the Effective Date, whose election,
or nomination for election by the Company’s stockholders, was approved by a
vote of at least a majority of those individuals who are members of the Board
and who were also members of the Incumbent Board (or deemed to be such pursuant
to this proviso) shall be considered as though such individual were a member of
the Incumbent Board;  but, provided
further, that any such individual whose initial assumption of office occurs as
a result of either an actual or threatened election contest (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Act) or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board shall not be so considered as a member of the
Incumbent Board;  or

 

(iii)                               The
approval by the stockholders of the Company of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company or the acquisition of assets of another corporation (“Corporate
Transaction”) or, if consummation of such Corporate Transaction is
subject, at the time of such approval by stockholders, to the consent of any
government or governmental agency, the obtaining of such consent (either
explicitly or implicitly by consummation); 
excluding, however, such a Corporate Transaction pursuant to which (1)
all or substantially all of the individuals and entities who are the beneficial
owners, respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Corporate Transaction will
beneficially own, directly or indirectly, more than 60% of, respectively, the
outstanding shares of common stock, and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the company resulting from such Corporate
Transaction (including, without limitation, a corporation which as a result of
such transaction owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Corporate
Transaction, of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be, (2) no Person (other than the Company,
any employee benefit plan (or related trust) sponsored or maintained by the
Company or any corporation controlled by the Company or such corporation
resulting from such Corporate Transaction) will beneficially own, directly or
indirectly, 20% or more of, respectively, the outstanding shares of common
stock of the corporation resulting from such

 

 

Corporate Transaction or the
combined voting power of the outstanding voting securities of such corporation
entitled to vote generally in the election of directors except to the extent
that such ownership existed with respect to the Company prior to the Corporate
Transaction and (3) individuals who were members of the Incumbent Board will
constitute at least a majority of the board of directors of the corporation
resulting from such Corporate Transaction; 
or

 

(iv)                              The
approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.

 

“Change of
Control Price” means the higher of (i) the highest reported closing
price of a share of Common Stock in any transaction reported on the Nasdaq
Stock Market during the 60-day period prior to and including the date of a
Change of Control or (ii) if the Change of Control is the result of a tender or
exchange offer or a Corporate Transaction, the highest price per share of
Common Stock paid in such tender or exchange offer or Corporate
Transaction;  provided, however, that in
the case of a Stock Option which was granted within 240 days of the Change of
Control, then the Change of Control Price for such Stock Option shall be the
Fair Market Value of the Common Stock on the date such Stock Option is
exercised or deemed exercised.  To the
extent that the consideration paid in any such transaction described above
consists all or in part of securities or other noncash consideration, the value
of such securities or other noncash consideration shall be determined in the
sole discretion of the Committee.

 

“Code”
shall mean the Internal Revenue Code of 1986, as amended from time to time, and
the rules and regulations thereunder.

 

“Common Stock”
shall mean the common stock, $.001 par value, of the Company.

 

“Company”
shall mean Datalink Corporation, a Minnesota corporation.

 

“Effective
Date” shall mean August 11, 2000.

 

“ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended from
time to time, and the rules and regulations thereunder.

 

“Fair Market
Value” shall mean, as of any given date, the closing price of the
Common Stock on the Nasdaq Stock Market for that date (or for the preceding
trading day, if no trading occurs on such date), adjusted to the next higher
cent if such closing price is not a whole number.  If there is no regular public trading market for such Common
Stock, the Fair Market Value of the Common Stock shall be determined by the
Committee in good faith.

 

“Fees”
shall mean the cash payments described under Section 7 below or, if a
Participant makes no timely election to receive these cash payments, the annual
retainer Stock Options and periodic Stock Options to be granted under
Section 8 below for attendance at board and committee meetings for a
Participant in connection with his or her service on the Board or any committee
thereof for any fiscal year of the Company.

 

“Incentive
Compensation Plan” shall mean the Company’s 1999 Incentive
Compensation Plan adopted as of June 11, 1999, as it may be amended from
time to time.

 

“Participant”
shall mean each member of the Board who is not an employee of the Company or
any subsidiary of the Company.

 

“Plan”
shall mean the Datalink Corporation 2000 Director Stock Plan.

 

“Retirement”
shall mean the retirement by a Participant from the Board in accordance with
any formal or informal policy adopted by the Company on Director retirement.

 

“Rules”
shall mean the rules promulgated under the Act from time to time and the
interpretations issued by Securities and Exchange Commission in respect
thereof.

 

“Stock Option”
shall mean a non-qualified stock option, which is further defined as any right
to acquire Common Stock which does not qualify as an “incentive stock option”
as defined under the Code.

 

Section 3.                                          Eligibility

 

Each member of
the Board who is not an employee of the Company or any subsidiary of the
Company shall be eligible to participate in the Plan.

 

 

Section 4.                                          Shares Subject to the Plan

 

The maximum
number of shares of Common Stock which shall be available for use under the
Plan shall be 300,000, subject to adjustment pursuant to Section 15
hereunder.  The shares issued under the
Plan shall be authorized and unissued shares.

 

Section 5.                                          Duration of Plan

 

Unless earlier
terminated pursuant to Section 11 hereof, this Plan shall automatically
terminate on, and no grants or elections may be made after, the date of the
tenth anniversary of the approval by stockholders of the Plan pursuant to
Section 17 hereof.

 

Section 6.                                          Administration

 

The Plan shall
be administered by the Board or any committee thereof so designated by the
Board (the “Committee”), which shall have full authority to construe and
interpret the Plan, to establish, amend and rescind rules and regulations
relating to the Plan, and to take all such actions and make all such
determinations in connection with the Plan as it may deem necessary or
desirable.

 

Notwithstanding
any other provision of the Plan, neither the Board nor the Committee shall be
authorized to exercise any discretion with respect to the selection of
Participants to receive Stock Options under the Plan or concerning the amount,
timing or vesting of such Stock Options under the Plan, and no amendment or
termination of the Plan shall adversely affect the interest of any Director in
Stock Options previously granted to the Director without that Director’s
express written consent.

 

Section 7.                                          Cash Fees

 

Not more often
than annually, the Board shall set its annual cash retainer for service on the
Board and its cash payments for attendance at meetings of the Board and its
audit, compensation and other committees. Until otherwise changed, the annual
retainer for Board service commencing as of the annual meeting of stockholders
held in 2002 is $10,000, and the payment for attendance at each meeting of the
Company’s audit and compensation committees is $1,000 and $500, respectively.  Each Participant who, prior to the beginning
of any calendar year while the Plan is in effect, delivers to the Company
written notice of an irrevocable election to receive cash Fees for such
upcoming calendar year rather than grants of Stock Options as provided in
Section 8 below, shall receive cash payment of Fees.  Any such written notice pursuant to this
Section 7 shall remain in effect only for such calendar year and each
Participant must make a new election for each future year.

 

Section 8.                                          Grants of Stock Options

 

(a)                                  Annual Retainer.  Commencing
with and effective as of the annual meeting of stockholders of the Company held
in 2004, and on the date of each subsequent annual meeting of stockholders
occurring while this Plan is in effect, and unless a timely election is made
under Section 7 above to receive cash Fees, each Participant shall receive
a grant of Stock Options.  The number of
these Stock Options is 90% of the annual cash retainer Fee for Board service
set out in Section 7 above. 
Therefore, for 2004 and until the cash retainer Fee is changed by the
Board, the number of Stock Options is 9,000. 
These Stock Options shall be exercisable commencing one year after the
date of grant;  provided, however, that
if a Participant fails to serve until the annual stockholders’ meeting
immediately succeeding a grant of such Stock Options, the number of shares of
Common Stock that may be purchased by such Participant shall be determined by
multiplying the number of Stock Options granted (initially, 9,000) by a
fraction (i) the numerator of which is the number of days between the date such
Stock Options were granted and the date the Participant ceased serving on the
Board and (ii) the denominator of which is the number of days between the date
such Stock Options were granted and the date of the annual stockholders’
meeting immediately succeeding the date of grant.  The exercise price of the Stock Options so granted shall be the
Fair Market Value per share on the date of grant.  These Stock Options will expire ten years after the date of
grant.

 

(b)                                 Participation in Board and Committee Meetings. 
Commencing with and effective as of each meeting of the Board or a
committee thereof held on or after April 1, 2004,  and while this Plan is in effect, and unless
a timely election is made under Section 7 above to receive cash Fees, each
Participant participating in such Board or committee meeting shall receive an
additional grant of Stock Options.  The
number of these Stock Options is 70% of the cash Fee for attendance at Board
meetings and 100% of the cash Fee for attendance at committee meetings set out
in Section 7 above.  Therefore,
until changed by the Board, for Board meetings, the number of Stock Options
will be seven hundred (700) and for committee meetings, the number of Stock
Options will be five hundred (500). 
These Stock Options will be fully vested and exercisable immediately
upon their grant, which shall be on the last day of the calendar quarter during
which the Board or committee meeting takes place.  The exercise price of the Stock Options so granted shall be the
Fair Market Value per share on the date of grant.  These Stock Options will expire ten years after the date of
grant.

 

 

In addition,
as to those Participants who have waived the right to receipt of Stock Options
at March 31, 2004 on account of attendance at Board or committee meetings,
respectively, held between January 1 and March 31, 2004, the Company
shall, on a one-time basis, grant to each such Participant 700 and 500 Stock
Options, respectively.  These Stock
Options will be fully vested and exercisable immediately upon their grant,
which shall be a date set by the Board within ten (10) days of the date of this
amended and restated Plan.  The exercise
price of the Stock Options so granted shall be the Fair Market Value per share
on the date of grant.  These Stock
Options will expire ten years after the date of grant.

 

(c)                                  Exercise of
Stock Options.  Stock Options
granted to Participants shall be exercised by the delivery of a written notice
of exercise to the Company, setting forth the number of shares with respect to
which the Stock Option is to be exercised, accompanied by full payment for the
shares.  Participants may pay the
exercise price either (i) in cash or its equivalent, (ii) by tendering
previously acquired shares of Common Stock having an aggregate Fair Market
Value at the time of exercise equal to the total option price (provided that
the Participant has held the shares tendered for at least six (6) months prior
to their tender to satisfy the option price) or (iii) by a combination of (i)
and (ii).  The Board also may allow
cashless exercise, subject to applicable securities law restrictions, or by any
other means which the Board determines to be consistent with the Plan’s purpose
and applicable law.  Subject to any
governing rules or regulations, as soon as practicable after receipt of a
written notification of exercise and full payment, the Company shall deliver to
the Participant, in the Participant’s name, share certificates in an
appropriate amount based upon the number of shares purchased under the Stock
Option.

 

(d)                                 Option
Agreements.  The Company and
a Participant may, but are not required to, enter into a written agreement
relating to Stock Option grants; 
provided, that any such agreement is not inconsistent with the
provisions of the Plan.

 

Section 9.                                          Transferability

 

Rights and grants
under the Plan may not be assigned, transferred, pledged or hypothecated, and
shall not be subject to execution, attachment or similar process.  Notwithstanding the foregoing, any such
right or grant constituting a “derivative security” under the Rules shall not
be transferable by a Participant other than by will or by operation of
applicable laws of descent and distribution or pursuant to a domestic relations
order or qualified domestic relations order as such terms are defined by the
Code or ERISA.

 

Section 10.                                   Amendment

 

The Board may
from time to time make such amendments to the Plan as it may deem proper and in
the best interest of the Company without further approval of the Company’s
stockholders, provided that to the extent required to qualify transactions
under the Plan for exemption under Rule 16b-3 promulgated under the Act  (“Rule 16b-3”) no amendment to the Plan shall
be adopted without further approval by the holders of at least a majority of
the shares of Common Stock present, or represented, and entitled to vote at a
meeting held for such purpose, and provided further, that if and to the extent
required for the Plan to comply with Rule 16b-3, no amendment to the Plan shall
be made more than once in any six-month period that would change the amount,
price or timing of the grants of Stock Options hereunder other than to comport
with changes in the Code, ERISA or the regulations thereunder.

 

Section 11.                                   Termination

 

The Plan may
be terminated at any time by the Board or by the approval by the holders of at
least a majority of the shares of Common Stock present, or represented, and
entitled to vote at a meeting held for such purpose.

 

Section 12.                                   Effect of Change of Control

 

Notwithstanding
any other provision of the Plan to the contrary, in the event of a Change of
Control, any Stock Options outstanding and not then exercisable and vested as
of the date such Change of Control is determined to have occurred, shall become
fully exercisable and vested to the full extent of the original grant.  During the 60-day period from and after a
Change of Control (the “Exercise Period”), a Participant who holds
a Stock Option shall have the right, in lieu of the payment of the exercise
price for the shares of Common Stock being purchased under the Stock Option, by
giving notice to the Company, to elect (within the Exercise Period) to
surrender all or part of a Stock Option to the Company and to receive cash,
within 30 days of such notice, in an amount equal to the amount by which the
Change of Control Price per share of Common Stock on the date of such election
shall exceed the exercise price per share of Common Stock under the Stock
Option (the “Spread”) multiplied by the number of shares of Common Stock
granted under the Stock Option as to which the right granted under this
Section shall have been exercised; 
provided, however, that if the Change of Control is within six (6)
months of the date of grant of a particular Stock Option held by a Participant,
no such election shall be made by such Participant with respect to such Stock
Option prior to six (6) months from the date of grant.  If the end of such 60-day period from and
after a Change of Control is within six (6) months from the date of grant of a
Stock Option, such Stock Option shall be cancelled in exchange for a cash
payment to the Participant, effected on the day which is six (6) months and one

 

 

day after the date of grant of
such Stock Option, equal to the Spread multiplied by the number of shares of
Common Stock granted under the Stock Option.

 

Section  13.                                Death, Disability, Termination or Retirement of
Participant

 

(a)                                  Death While
A Director.  Notwithstanding
any other provision of the Plan to the contrary, in the event of the death of a
Participant while a member of the Board, any Stock Options outstanding as of
the date of death and not then exercisable shall become immediately
exercisable, and all outstanding Stock Options held by such Participant shall
remain exercisable by the person to whom the Stock Option is transferred by
will or by the laws of descent and distribution for a period of the lesser of
(i) the remaining term of the Stock Option or (ii) three (3) years after the
date of death.

 

(b)                                 Disability,
Retirement or Other Termination. 
Except as otherwise provided by the Plan, in the event of a
Participant’s termination of membership on the Board as a result of the
Participant’s disability or Retirement or for another reason other than Cause
as defined below, any Stock Options outstanding as of the date of such
termination and not then exercisable shall, as to annual retainer options, be
adjusted in amount to reflect the proportion earned in the final year of such
Participant’s service in such year (in accordance with the operation of
Section 8 of this Plan) and (ii) become exercisable on the last day of the
Company’s then-current fiscal year.  All
outstanding Stock Options held by such Participant shall remain exercisable for
the full period contemplated by the terms of such Stock Options.  In the event of the death of a Participant
subsequent to termination of membership from the Board as a result of
circumstances described in this Section 13(b), any Stock Options
outstanding as of the date of death and not then exercisable shall become
immediately exercisable, and all outstanding Stock Options held by such
Participant shall remain exercisable by the person to whom the Stock Option is
transferred by will or by the laws of descent and distribution for a period of
the lesser of (i) the remaining term of the Stock Option or (ii) three (3)
years after the date of death.

 

Section 14.                                   Effect of Termination for Cause

 

If a
Participant incurs a termination of membership on the Board for Cause, such
Participant’s Stock Options which are not then exercisable shall be
automatically cancelled immediately. 
Unless otherwise determined by the Board, for purposes of the Plan “Cause”
shall mean (i) the conviction of the Participant for commission of a felony
under Federal law or the law in the state in which such action occurred or (ii)
dishonesty in the course of fulfilling the Participant’s duties as a director.

 

Section 15.                                   Adjustments Upon Changes in Capitalization

 

In the event
of any change in corporate capitalization, such as a stock split or a corporate
transaction, such as any merger, consolidation, separation, including a spin
off, or other distribution of stock or property of the Company, any
reorganization (whether or not such reorganization comes within the definition
of such term in Section 368 of the Code) or any partial or complete
liquidation of the Company, the Committee or Board may make such substitution
or adjustments in the aggregate number and class of shares reserved for
issuance under the Plan and in the number, kind and option price of shares
subject to outstanding Stock Options and/or such other equitable substitution
or adjustments as it may determine to be appropriate in its sole
discretion;  provided, however, that the
number of shares subject to any Stock Option shall always be a whole number.

 

Section 16.                                   Regulatory Matters

 

The Plan is
intended to be construed so that participation in the Plan will be exempt from
Section 16(b) of the Act, pursuant to Rule 16b-3 as promulgated
thereunder, as may be further amended or interpreted by the Securities and
Exchange Commission.  In the event that
any provision of the Plan shall be deemed not to be in compliance with the
Rules in order to enjoy the exemption from the Act, such provision shall be
deemed of no force or effect and the remaining provisions of the Plan shall
remain in effect.

 

Section 17.                                   Effectiveness of Plan

 

The Plan shall
become effective as of the Effective Date. 
However, the Plan shall terminate if not ratified on or before the date
of the Company’s 2001 annual meeting of stockholders by the holders of at least
a majority of the shares of Common Stock present, or represented, and entitled
to vote at such meeting or at another stockholders’ meeting held before such
date for this purpose.

 

Section 18.                                   Resolution
of Conflict with Incentive Compensation Plan

 

Nothing in
this Plan shall affect the rights or eligibility of Participants as to awards
and grants made under the Incentive Compensation Plan prior to or after the
Effective Date of this Plan.  However,
this Plan supersedes and replaces the provisions of Section 6.8 of the
Incentive Compensation Plan relating to automatic annual director stock option
grants for 2001 and fiscal years thereafter that this Plan is in effect.

 

 

Section 19.                                   Governing Law

 

To the extent not preempted by
Federal law, the Plan, and all agreements hereunder, shall be construed in
accordance with and governed by the laws of the State of Minnesota.

 

End of Plan

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