Exhibit 10.23
Dade Behring Holdings, Inc.
---------------------------
1997 EXECUTIVE STOCK PURCHASE AND OPTION PLAN
---------------------------------------------
1. Purpose of Plan. This 1997 Executive Stock Purchase and Option Plan
(the "Plan") of Dade Behring Holdings, Inc. (the "Company") is designed to
provide incentives to such present and future officers, employees, consultants
or advisors of the Company or its subsidiaries as may be selected in the sole
discretion of the Board (collectively, "Participants"), through the grant of
Options by the Company to Participants or through the sale of Common Stock to
Participants. Only those Participants who are employees of the Company and its
Subsidiaries shall be eligible to receive incentive stock options.
2. Definitions. Certain terms used in this Plan have the meanings set
forth below:
"Board" means the Company's board of directors.
"Cause" shall have the meaning assigned to such term in any individual
Participant's written employment arrangements with the Company or any of its
Subsidiaries or, in the absence of any such written employment arrangements,
"Cause" shall mean (i) the intentional disregard of a written direction from the
Board to a Participant to which such Participant has not objected within ten
(10) days of receiving such written direction, which intentional disregard is
materially injurious to the Company or any of its Subsidiaries, (ii) the knowing
and intentional theft by such Participant of property of the Company or any of
its Subsidiaries, which property has a substantial value, (iii) the commission
by such Participant of an act of moral turpitude which is materially injurious
to the Company or any of its Subsidiaries or (iv) any material breach of this or
any employment agreement between the Company or its Subsidiaries and such
Participant or any material breach of any executive agreement evidencing the
purchase and sale of Common Stock or the grant of Options by the Company to such
Participant.
"Class L Common" means the Company's Class L Common Stock, par value $.01
per share, or, in the event that the outstanding shares of Class L Common are
hereafter recapitalized, converted into or exchanged for different stock or
securities of the Company, such other stock or securities.
"Code" means the Internal Revenue Code of 1986, as it may be amended from
time to time.
"Common" means the Company's Common Stock, par value $.01 per share, or, in
the event that the outstanding shares of Common are hereafter recapitalized,
converted into or exchanged for different stock or securities of the Company,
such other stock or securities.
"Common Stock" means the Class L Common and the Common.
"Disability" means (i) any physical or mental incapacitation which results
in a Participant's inability to perform his or her duties and responsibilities
for the Company and its Subsidiaries for a total of 120 days during any 12 month
period, as determined by the Board in its good faith judgment and (ii) shall be
deemed to have occurred on the 120th day of such inability to perform.
"Executive Stock" with respect to a Participant, means any Common Stock
purchased by such Participant hereunder and any Common Stock issued to such
Participant upon exercise of any Options granted hereunder.
"Fair Market Value" of a share of Common Stock means (a) the mean between
the highest and lowest reported sale prices of a share of Common Stock on the
New York Stock Exchange--Composite Transactions Table (or, if not so reported,
on any domestic stock exchanges on which the Common Stock is then listed); or
(b) if the Common Stock is not listed on any domestic stock exchange, the mean
between the closing high bid and low asked prices of a share of Common Stock as
reported by the National Association of Securities Dealers Automated Quotation
System (or, if not so reported, by the system then regarded as the most reliable
source of such quotations); or (c) if the Common Stock is listed on a domestic
stock exchange or quoted in the domestic over-the-counter market, but there are
not reported sales or quotations, as the case may be, on the given date, the
value determined pursuant to (a) or (b) above using the reported sale prices or
quotations on the last previous date on which so reported; or (d) if none of the
foregoing clauses apply, the fair market value of a share of Common Stock
without discounts as determined in good faith by the Board and stated in writing
in a notice delivered to the holders of the Common Stock involved (a
"Determination Notice").
"Independent Third Party" means any person who, immediately prior to the
contemplated transaction, does not own in excess of 5% of the Company's Common
Stock on a fully-diluted basis (a "5% Owner"), who is not controlling,
controlled by or under common control with any such 5% Owner and who is not the
spouse or descendent (by birth or adoption) of any such 5% Owner or a trust for
the benefit of such 5% Owner and/or such other persons.
"Investors" means the Persons listed on Schedule A hereto.
"Option" means any option enabling the holder thereof to purchase any class
of Common Stock from the Company granted by the Board pursuant to the provisions
of this Plan. Options to be granted under this Plan may be incentive stock
options within the meaning of Section 422 of the Code ("Incentive Stock
Options") or in such other form, consistent with this Plan, as the Board may
determine.
"Original Value" for each share of Executive Stock will be equal to the
price paid by the Participant for each share of Common Stock (as proportionally
adjusted for all stock splits, stock dividends, and other recapitalizations
affecting the Common Stock subsequent to the date of adoption hereof).
"Subsidiary" means any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company if, at the time the option is
granted, each of the corporations other than the last corporation in the chain
owns stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
3. Grant of Options. The Board shall have the right and power to grant to
any Participant, at any time prior to the termination of this Plan, Options in
such quantity, at such price, on such terms and subject to such conditions that
are consistent with this Plan and established by the Board. Options granted
under this Plan shall be in one of the forms described in this paragraph 3
below, or in such other form or forms as the Board may determine, and shall be
subject to such additional terms and conditions and evidenced by agreements as
shall be determined from time to time by the Board. Except as otherwise set
forth in such an agreement between the Company and any Participant, Options
shall be subject to all of the terms and conditions contained in this Plan.
(a) Target Options.
(i) A "Tranche I Option" shall entitle a Participant to purchase from
the Company one or more shares of Common and shall have an exercise price
per share as determined by the Board and evidenced in such Participant's
executive agreement (the "Tranche I Price").
(ii) A "Tranche II Option" shall entitle a Participant to purchase
from the Company one or more shares of Common and shall have an exercise
price per share as determined by the Board and evidenced in such
Participant's executive agreement (the "Tranche II Price").
(iii) Tranche I Options and Tranche II Options are referred to herein
as "Target Options," and the shares issued upon exercise of the Tranche I
Options or the Tranche II Options are referred to herein as "Target Option
Shares". The number of Target Option Shares, the Tranche I Price and the
Tranche II Price will be equitably adjusted for any stock split, stock
dividend, reclassification or recapitalization of the Company which occurs
subsequent to the date of adoption hereof. The Target Options will expire
on the earlier of the tenth anniversary of the date of grant or the date of
termination of the respective Participant's employment with the Company or
any of its Subsidiaries for any reason (the "Termination Date"); provided
that any portion of the Target Options which has not vested and become
exercisable prior to the Termination Date shall expire on the Termination
Date and may not be exercised under any circumstance; provided further that
any portion of the Target Options which has vested and become exercisable
prior to the Termination Date will expire on the earlier of (i) 30 days
after the Termination Date and (ii) the tenth anniversary of the date such
options are granted. Target Options are not intended to be "incentive stock
options" within the meaning of Section 422A of the Internal Revenue Code.
(iv) Exercisability. Target Options will immediately vest and become
exercisable
-3-
with respect to Target Option Shares on the date immediately prior to the
tenth anniversary of the date of adoption hereof; provided that upon the
occurrence of a Tranche I Acceleration Event, all of the Tranche I Options
will immediately vest and become exercisable and upon the occurrence of a
Tranche II Acceleration Event, all of the Tranche II Options will
immediately vest and become exercisable. For this purpose, a Tranche I
Acceleration Event shall be the date on which the purchasers of the
Company's common stock under that certain Stock Purchase Agreement dated as
of December 20, 1994 (the "Stock Purchase Agreement") as set forth on
Exhibit A attached hereto (collectively, the "Investors") have achieved an
Investor Return Multiple (as defined below) of at least three (a "Tranche I
Acceleration Event") and a Tranche II Acceleration Event shall be the date
on which the Investors have achieved an Investor Return Multiple of at
least five (a "Tranche II Acceleration Event"). A Tranche I Acceleration
Event and Tranche II Acceleration Event are also referred to herein as
"Acceleration Events."
(v) Vesting of Target Option Shares. Target Option Shares shall be
fully vested immediately upon exercise of the Target Options with respect
thereto.
(vi) Procedure for Exercise. At any time after all or any portion of
the Target Options have become exercisable with respect to any Target
Option Shares and prior to the Expiration Date, a Participant may exercise
all or a portion of his or her Target Options with respect to Target Option
Shares which have become vested and exercisable by delivering written
notice of exercise to the Company together with (i) a written
acknowledgment that such Participant has read and has been afforded an
opportunity to ask questions of management of the Company regarding all
financial and other information provided to such Participant regarding the
Company and (ii) payment in full by delivery of a cashier's, certified
check or wire transfer in the amount equal to the product of (A) in the
case of the Tranche I Option, the Tranche I Price multiplied by the number
of Tranche I Option Shares to be acquired and (B) in the case of the
Tranche II Option, the Tranche II Price multiplied by the number of Tranche
II Option Shares to be acquired. As a condition to any exercise of a Target
Option, a Participant will permit the Company to deliver to him or her all
financial and other information regarding the Company and its Subsidiaries
which it believes necessary to enable such Participant to make an informed
investment decision.
(vii) Determination of Investor Return Multiple.
(A) "Acceleration Event" will be the first to occur of (i) a Sale of
the Company or (ii) on any date subsequent to the date that (A) the Company
sells any shares of its common stock pursuant to a registration statement filed
under the Securities Act of 1933, as amended and (B) the Investors or their
affiliates cease to own in the aggregate at least 20% of the outstanding common
stock of the Company.
(B) "Investor Return Multiple" means the number determined by dividing
Cash Inflows (as defined below) by Cash Outflows (as defined below). The
calculation of the
-4-
Investor Return Multiple will be determined in good faith by the Board.
(C) "Cash Inflows" as used herein shall include the sum of all cash
payments received by the Investors on the consummation of or prior to an
Acceleration Event with respect to debt or equity securities of the Company
purchased by the Investors (excluding all management fees, points, and other
fees paid to the Investors by or on behalf of the Company and/or its
Subsidiaries) prior to such Acceleration Event (whether such payments are
received from the Company or any third party, and whether such payments are
received as interest, dividends, proceeds with respect to sale or redemption of
such securities, upon a liquidation of the Company or otherwise), including
reimbursement for payments made by Investors in respect of fees and expenses
incurred in connection therewith.
(D) "Cash Outflows" as used herein shall include the sum of all cash
payments and investments made by the Investors to and in the Company and to
others to acquire debt or equity securities of the Company prior to an
Acceleration Event, including payments made by Investors in respect of fees and
expenses incurred in connection therewith.
(E) "Sale of the Company" means any transaction involving the Company
and an Independent Third Party or affiliated group of Independent Third Parties
pursuant to which such party or parties acquire (i) a majority of the
outstanding shares of capital stock of the Company entitled to vote generally in
the election of the Company's board of directors (whether by merger,
consolidation or sale or transfer of the Company's capital stock) or (ii) all or
substantially all of the Company's assets determined on a consolidated basis
(for purposes hereof "all or substantially all" shall have the meaning given
such phrase in the Revised Model Business Corporation Act).
(b) Time Options.
(i) A "Time Option" shall entitle a Participant to purchase one or
more shares of Common ("Time Option Shares") and shall have an exercise
price per share as determined by the Board and evidenced in such
Participant's executive agreement (the "Option Price"). The Option Price
and the number of Time Option Shares will be equitably adjusted for any
stock split, stock dividend, reclassification or recapitalization of the
Company which occurs subsequent to the date of adoption hereof. The Time
Options will expire on the earlier of the tenth anniversary of the date of
grant or the Termination Date; provided that any portion of the Time
Options which has not vested and become exercisable prior to the
Termination Date shall expire on the Termination Date and may not be
exercised under any circumstance; provided further that any portion of the
Time Options which has vested and become exercisable prior to the
Termination Date will expire on the earlier of (i) 30 days after the
Termination Date and (ii) the tenth anniversary of the date such options
are granted. Time Options are not intended to be "incentive stock options"
within the meaning of Section 422A of the Internal Revenue Code.
(ii) Exercisability. On each date set forth below, the Time Options
will vest, and
-5-
thus become exercisable as set forth in the agreement between the Company
and the Participant, or, in the absence of such a term in such agreement,
with respect to the cumulative percentage of Time Option Shares set forth
opposite such date if the respective Participant is, and has been,
continuously employed by the Company or any of its Subsidiaries from the
date of grant through such date:
Cumulative Percentage
Date of Time Options Vested
---- ----------------------
October 1, 1998 20%
October 1, 1999 40%
October 1, 2000 60%
October 1, 2001 80%
October 1, 2002 100%
(iii) Vesting of Time Option Shares. Time Option Shares shall be fully
vested immediately upon exercise of the Time Option with respect thereto.
(iv) Procedure for Exercise. At any time after all or any portion of
the Time Options have become exercisable with respect to any Time Option
Shares and prior to the Expiration Date, a Participant may exercise all or
a portion of his or her Time Option with respect to the Time Option Shares
which have become vested and exercisable by delivering written notice of
exercise to the Company together with (i) a written acknowledgment that
such Participant has read and has been afforded an opportunity to ask
questions of management of the Company regarding all financial and other
information provided to such Participant regarding the Company and (ii)
payment in full by delivery of a cashier's, certified check or wire
transfer in the amount equal to the product of the Option Price multiplied
by the number of Time Option Shares to be acquired. As a condition to any
exercise of a Time Option, a Participant will permit the Company to deliver
to him or her all financial and other information regarding the Company and
its Subsidiaries which it believes necessary to enable such Participant to
make an informed investment decision.
4. Sale of Common Stock. The Board shall have the power and authority to
sell to any Participant any class or classes of Common Stock ("Purchased Stock")
at any time prior to the termination of this Plan in such quantity, at such
price, on such terms and subject to such conditions that are consistent with
this Plan and established by the Board. Common Stock sold under this Plan shall
be subject to such terms and evidenced by agreements as shall be determined from
time to time by the Board.
5. Repurchase Option. In the event that a Participant is no longer
employed by the Company or any of its Subsidiaries for any reason (the date of
such termination being referred to
-6-
herein as the "Termination Date"), the Executive Stock issued to such
Participant, whether held by such Participant or one or more transferees, will
be subject to repurchase by the Company and the Investors (solely at their
option) pursuant to the terms and conditions set forth in this paragraph 5 (the
"Repurchase Option"), unless otherwise set forth in the agreement between the
Company and the Participant.
(a) Termination Other than for Cause. If a Participant is no longer
employed by the Company or any of its Subsidiaries as a result of any reason
other than such Participant's termination for Cause, then on or after the
Termination Date, the Company may elect to purchase all or any portion of the
Executive Stock issued to such Participant at a price per share equal to the
Fair Market Value thereof (x) as determined on the Termination Date, if the
Repurchase Notice (as defined in subparagraph (c) below) has been delivered
within three months of the Termination Date or (y) as determined on a date
determined by the Board within 30 days prior to the delivery of the Repurchase
Notice, if the Repurchase Notice is delivered after the third month following
the Termination Date.
(b) Termination for Cause. If a Participant is no longer employed by the
Company or any of its Subsidiaries as a result of such Participant's termination
for Cause, then on or after the Termination Date, the Company may elect to
purchase all or any portion of the Executive Stock issued to such Participant at
a price per share equal to the lower of its Original Value or the Fair Market
Value thereof.
(c) Repurchase Procedures. Pursuant to the Repurchase Option, the Company
may elect to exercise the right to purchase all or any portion of the shares of
Executive Stock issued to a Participant by delivering written notice (the
"Repurchase Notice") to the holder or holders of the such Executive Stock. The
Repurchase Notice will set forth the number of shares of Executive Stock to be
acquired from such holder(s), the Fair Market Value for such shares, the
aggregate consideration to be paid for such shares and the time and place for
the closing of the transaction. In the event that the Company elects to purchase
a portion of such Executive Stock pursuant to the terms of this paragraph 5, if
any shares of such Executive Stock are held by transferees of such Participant,
the Company shall purchase the shares elected to be purchased from such
holder(s) of Executive Stock, pro rata according to the number of shares of
Executive Stock held by such holder(s) at the time of delivery of such
Repurchase Notice (determined as nearly as practicable to the nearest share). If
Executive Stock of different classes is to be purchased by the Company and
Executive Stock is held by transferees of such Participant, the number of shares
of each class of Executive Stock to be purchased will be allocated among such
holders, pro rata according to the total number of shares of Executive Stock to
be purchased from such persons.
(d) Investor Rights.
(i) If for any reason the Company does not elect to purchase all of
the Executive Stock (issued to a particular Participant) pursuant to the
Repurchase Option prior to the 180th day following the Termination Date,
the Investors will be entitled to exercise the Repurchase Option, in the
manner set forth in this paragraph 5, for the Executive Stock the Company
has
-7-
not elected to purchase (the "Available Shares"). As soon as practicable,
but in any event within thirty (30) days after the Company determines that
there will be any Available Shares, the Company will deliver written notice
(the "Option Notice") to the Investors setting forth the number of
Available Shares and the price for each Available Share as determined
pursuant to the provisions of this paragraph 5.
(ii) Each of the Investors will initially be permitted to purchase its
pro rata share (based upon the number of shares of Common Stock then held
by such Investors) of the Available Shares. Each Investor may elect to
purchase any number of the Available Shares (subject to all of the terms of
this paragraph 5) by delivering written notice to the Company within 30
days after receipt of the Option Notice from the Company (such 30-day
period being referred to herein as the "Investor Election Period").
(iii) As soon as practicable but in any event within five (5) days
after the expiration of the Investor Election Period, the Company will, if
necessary, notify the Investors electing to purchase Available Shares of
any Available Shares which Investors have elected not to purchase and each
of the electing Investors will be entitled to purchase the remaining
Available Shares on the same terms as described above (the "Second Option
Notice"); provided that if in the aggregate such Investors elect to
purchase more than the remaining Available Shares, such remaining Available
Shares purchased by each such Investor will be reduced on a pro rata basis
based upon the number of shares of Common Stock then held by such
Investors. Each Investor may elect to purchase any of the remaining
Available Shares available to such Investor by delivering written notice to
the Company within 10 days after the delivery of the Second Option Notice
(with such 10-day period referred to herein as the "Second Investor
Election Period").
(iv) As soon as practicable but in any event within five (5) business
days after the expiration of the Investor Election Period or the Second
Investor Election Period (if any), the Company will, if necessary, notify
the holder(s) of the Executive Stock as to the number of shares of
Executive Stock being purchased from the holder(s) by the Investors (the
"Supplemental Repurchase Notice"). At the time the Company delivers a
Supplemental Repurchase Notice to the holder(s) of such Executive Stock,
the Company will also deliver to each electing Investor written notice
setting forth the number of such shares of Executive Stock that the Company
and each Investor will acquire, the aggregate purchase price to be paid and
the time and place of the closing of the transaction.
(v) The Company shall have the option at any time to repurchase from
any Investor any shares of Common Stock purchased by such Investor pursuant
to the terms hereof at a price per share equal to the amount paid therefor
by such Investor plus 8% per annum from the date such Investor purchased
such shares to the date of repurchase of such shares by the Company. For
purposes of determining an Investor Return Multiple, the amount of cash
payments to, and investments by, Investors under this paragraph 5 shall not
be taken into account in determining Cash Inflows and Cash Outflows.
-8-
(e) Closing. The closing of the transactions contemplated by this paragraph
5 will take place on the date designated by the Company in the Repurchase Notice
or the Supplemental Repurchase Notice, as the case may be, which date will not
be more than 90 days after the delivery of such notice. The Company and/or the
Investors, as the case may be, will pay for the Executive Stock to be purchased
pursuant to the Repurchase Option by delivery of, in the case of each Investor,
a check payable to the holder of Executive Stock, and in the case of the Company
(i) a check payable to the holder of such Executive Stock or (ii) if the
repurchase price to be paid by the Company is greater than $100,000, the Company
may elect to deliver a check payable to the holder of such Executive Stock in an
amount equal to the greater of $100,000 or one-third (1/3) of the repurchase
price to be paid by the Company, and a note or notes in the amount of the
balance of the repurchase price to be paid by the Company, which note or notes
shall be payable in three equal annual installments beginning on the first
anniversary of the closing of such purchase and bearing interest (payable
quarterly) at a rate per annum equal to 8%. Any notes issued by the Company
pursuant to this paragraph 5(e) shall be subject to any restrictive covenants to
which the Company is subject at the time of such purchase. The Company and/or
the Investors, as the case may be, will receive customary representations and
warranties from each seller regarding the sale of Executive Stock, including,
but not limited to, the representation that such seller has good and marketable
title to the Executive Stock to be transferred free and clear of all liens,
claims and other encumbrances.
(f) Restrictions on Repurchase. Notwithstanding anything to the contrary
contained in this Plan, all repurchases of Executive Stock by the Company shall
be subject to applicable restrictions contained in the Delaware General
Corporation Law and in the Company's and its Subsidiaries' debt and equity
financing agreements. If any such restrictions prohibit the repurchase of
Executive Stock hereunder which the Company is otherwise entitled to make, the
Company may make such repurchases as soon as it is permitted to do so under such
restrictions.
6. Administration of the Plan. The Board shall have the power and
authority to prescribe, amend and rescind rules and procedures governing the
administration of this Plan, including, but not limited to, the full power and
authority (i) to interpret the terms of this Plan, the terms of any Options
granted under this Plan, and the rules and procedures established by the Board
governing any such Options and (ii) to determine the rights of any person under
this Plan, or the meaning of requirements imposed by the terms of this Plan or
any rule or procedure established by the Board. Each action of the Board shall
be binding on all persons.
7. Participation Rights. At least 30 days prior to any sale or exchange
(a "Transfer") of any class of Common Stock by an Investor (other than a
Transfer among the Investors, their affiliates or an employee of the Company or
its Subsidiaries), such Investor (the "Transferring Stockholder") will deliver a
written notice (the "Sale Notice") to the Company and the holders of such class
of Executive Stock (the "Other Stockholders"), specifying in reasonable detail
the identity of the prospective transferee(s) and the terms and conditions of
the Transfer. The Other Stockholders may elect to participate in the
contemplated Transfer by delivering written notice to the Transferring
Stockholder within 30 days after delivery of the Sale Notice. If any Other
-9-
Stockholders have elected to participate in such Transfer, each of the
Transferring Stockholder and such Other Stockholders will be entitled to sell in
the contemplated Transfer, at the same price and on the same terms, a number of
shares of such class of Common Stock equal to the product of (i) the quotient
determined by dividing the number of shares of such class of Common Stock owned
by such person by the aggregate number of shares of such class of Common Stock
owned by the Transferring Stockholder and the Other Stockholders participating
in such sale and (ii) the number of shares of such class of Common Stock to be
sold in the contemplated Transfer. Notwithstanding the foregoing, in the event
that the Transferring Stockholder intends to transfer more than one class of
Common Stock, the Other Stockholders participating in such transfer shall be
required to sell in the contemplated Transfer a pro rata portion of shares of
all classes of Common Stock, which portion shall be determined in the manner set
forth immediately above. The Transferring Stockholder will use reasonable
efforts to obtain the agreement of the prospective transferee(s) to the
participation of the Other Stockholders in any contemplated Transfer, and the
Transferring Stockholder will not Transfer any of its shares of Common Stock to
the prospective transferee(s) unless (i) the prospective transferee(s) agrees to
allow the participation of the Other Stockholders or (ii) the Transferring
Stockholder agrees to purchase the number of shares of such class of Common
Stock from the Other Stockholders which the Other Stockholders would have been
entitled to sell pursuant to this Paragraph 7.
8. Anti-Dilution.
(a) If and whenever on or after the date of adoption hereof, the Company
issues or sells, or in accordance with this paragraph 8 is deemed to have issued
or sold, any shares of Common Stock (including shares held in the Company's
treasury) ("New Stock") some or all of which are issued and/or sold, other than
pursuant to the terms hereof, to any of the Investors or any of their affiliates
(the "Existing Stockholders"), then immediately upon such issuance or sale the
Company shall, in a written notice (a "New Stock Notice") delivered to each
Participant no later than the tenth (10th) day following such issuance or sale,
offer for sale to each Participant a number of additional shares of Common Stock
such that the number of shares of Common Stock, plus the number of unexercised
Options, held by such Participant immediately after such issuance or sale
(assuming purchase by such Participant of such additional shares) equals the
number of shares of Common Stock, plus the number of unexercised Options, held
by such Participant immediately prior to such issuance or sale multiplied by a
fraction, the numerator of which equals the total number of shares of Common
Stock deemed under this paragraph 8 to be outstanding immediately after such
issuance or sale, and the denominator of which equals the total number of shares
of Common Stock deemed under this paragraph 8 to be outstanding immediately
prior to such issuance or sale. The New Stock Notice shall state the number of
shares offered for sale to such Participant pursuant to this paragraph 8, the
purchase price per share therefor, as determined pursuant to this paragraph 8,
and the time and place for the closing of the purchase in the event such
Participant accepts the offer. The date of such closing shall be not more than
ninety (90) days following the issuance or sale of the New Stock.
(b) A Participant may elect to purchase all, none, or any portion not less
than 20% of the Common Stock offered for sale in a New Stock Notice by
delivering to the Company written notice
-10-
thereof within fifteen (15) days following such Participant's receipt of such
New Stock Notice. In the event any one or more Participants elect to purchase
less than all of the shares offered for sale to such Participants in New Stock
Notices with respect to a particular issuance or sale, the Company shall make
available any such shares which such Participants elect not to purchase on a pro
rata basis to all other Participants, in a manner substantially similar to that
provided in paragraph 5(d) hereof with respect to Investors' rights.
(c) For purposes of the computation referred to in this paragraph 8, the
number of shares of Common Stock outstanding shall be deemed to include all
shares issuable to the holders of any securities exercisable for, or convertible
into, shares of Common Stock. For purposes of the computation of the
consideration per share received, as referred to in this paragraph 8, the
consideration received upon issuance or sale of securities shall be deemed to
include the consideration received for all securities issued in the same
transaction to the same purchaser, as appropriate under the circumstances. The
Common Stock offered for sale pursuant to this paragraph 8 shall be of the same
class as the New Stock; and, if the New Stock is comprised of Common Stock of
more than one class, the stock offered for sale pursuant to this paragraph 8
shall be comprised of the same classes in the same proportions as the New Stock.
The purchase price per share for Common Stock offered for sale pursuant to this
paragraph 8 shall be equal to the price per share at which the New Stock is
sold.
(d) The Existing Stockholders may, in their sole discretion, elect to
fulfill the Company's obligations to Participants under this paragraph 8 out of
such Existing Stockholders' holdings of Common Stock. In the event the Existing
Stockholders fulfill the Company's obligations to Participants under this
paragraph 8 with respect to an issuance or sale of Common Stock, the Company
shall have no further obligations to such Participants under this paragraph 8
with respect to such issuance or sale.
9. Limitation on the Aggregate Number of Shares. The number of shares of
Common Stock issued under this Plan (including the number of shares of Common
Stock with respect to which Options may be granted under this Plan (and which
may be issued upon the exercise or payment thereof)) shall not exceed, in the
aggregate, 1,000,000 shares of Common (as such number is equitably adjusted
pursuant to the terms hereof). If any Options expire unexercised or unpaid or
are canceled, terminated or forfeited in any manner without the issuance of
Common Stock or payment thereunder, the shares with respect to which such
Options were granted shall again be available under this Plan. Similarly, if any
shares of Common Stock issued hereunder, either as Purchased Stock or upon
exercise of Options, are repurchased hereunder, such shares shall again be
available under this Plan for reissuance as Executive Stock. In addition, if any
party other than the Company purchases shares of Common Stock in lieu of
repurchase by the Company, the Company will, as promptly as legally permissible,
purchase such shares from such party and such shares shall again be available
under this Plan for reissuance as Executive Stock. Shares of Common Stock to be
issued upon exercise of the Options or shares of Common Stock to be sold
directly hereunder may be either authorized and unissued shares, treasury
shares, or a combination thereof, as the Board shall determine.
-11-
10. Incentive Stock Options. All Incentive Stock Options (i) shall have
an exercise price per share of Common Stock of not less than 100% of the fair
market value of such share on the date of grant, (ii) shall not be exercisable
more than ten years after the date of grant, (iii) shall not be transferable
other than by will or under the laws of descent and distribution and, during the
lifetime of the Participant to whom such Incentive Stock Options were granted,
may be exercised only by such Participant (or his guardian or legal
representative), and (iv) shall be exercisable only during the Participant's
employment by the Company or a Subsidiary, provided, however, that the Board
may, in its discretion, provide at the time that an Incentive Stock Option is
granted that such Incentive Stock Option may be exercised for a period ending no
later than either (x) the termination of this Plan in the event of the
Participant's death while an employee of the Company or a Subsidiary, or (y) the
date which is three months after termination of the Participant's employment for
any other reason. The Board's discretion to extend the period during which an
Incentive Stock Option is exercisable shall only apply if and to the extent that
(i) the Participant was entitled to exercise such Option on the date of
termination, and (ii) such Option would not have expired had the Participant
continued to be employed by the Company or a Subsidiary. To the extent that the
aggregate fair market value of stock with respect to which Incentive Stock
Options are exercisable for the first time by any individual during any calendar
year exceeds $100,000, such Options shall be treated as Options which are not
Incentive Stock Options.
11. Listing, Registration and Compliance with Laws and Regulations. Each
Option shall be subject to the requirement that if at any time the Board shall
determine, in its discretion, that the listing, registration or qualification of
the shares subject to the Option upon any securities exchange or under any state
or federal securities or other law or regulation, or the consent or approval of
any governmental regulatory body, is necessary or desirable as a condition to or
in connection with the granting of such Option or the issue or purchase of
shares thereunder, no such Option may be exercised or paid in Common Stock in
whole or in part unless such listing, registration, qualification, consent or
approval (a "Required Listing") shall have been effected or obtained, and the
holder of the Option will supply the Company with such certificates,
representations and information as the Company shall request which are
reasonably necessary or desirable in order for the Company to obtain such
Required Listing, and shall otherwise cooperate with the Company in obtaining
such Required Listing. In the case of officers and other persons subject to
Section 16(b) of the Securities Exchange Act of 1934, as amended, the Board may
at any time impose any limitations upon the exercise of an Option which, in the
Board's discretion, are necessary or desirable in order to comply with Section
16(b) and the rules and regulations thereunder. If the Company, as part of an
offering of securities or otherwise, finds it desirable because of federal or
state regulatory requirements to reduce the period during which any Options may
be exercised, the Board may, in its discretion and without the consent of the
holders of any such Options, so reduce such period on not less than 15 days'
written notice to the holders thereof.
12. Cash Payments Upon Exercise. Upon the written request of the holder of
exercisable Options which are not Incentive Stock Options, the Board may provide
that such holder shall, as soon as practicable after the exercise of the
Options, receive, in lieu of any issuance of
-12-
Common Stock, a cash payment in such amount as the Board and such holder may
agree, but not more than the excess of the Fair Market Value of a share of
Common Stock (on the date the holder recognizes taxable income) over the
Option's exercise price multiplied by the number of shares as to which the
Option is exercised.
13. Adjustment for Change in Common Stock. In the event of a
reorganization, recapitalization, stock split, stock dividend, combination of
shares, merger, consolidation or other change in the Common Stock, the Board
shall make appropriate changes in the number and type of shares authorized by
this Plan, the number and type of shares covered by outstanding Options and the
prices specified therein.
14. Taxes. The Company shall be entitled, if necessary or desirable, to
withhold (or secure payment from the Plan participant in lieu of withholding)
the amount of any withholding or other tax due from the Company or any
subsidiary with respect to any amount payable and/or shares issuable under this
Plan, and the Company or any subsidiary may defer such payment or issuance
unless indemnified to its satisfaction.
15. Termination and Amendment. The Board at any time may suspend or
terminate this Plan and make such additions or amendments as it deems advisable
under this Plan, except that they may not, without further approval by the
Company's stockholders, (a) increase the maximum number of shares as to which
Options may be granted under this Plan, except pursuant to an express provision
hereof or (b) extend the term of this Plan; provided that, subject to paragraph
11 hereof, the Board may not change any of the terms of a written agreement with
respect to an Option between the Company and the holder of such Option without
the approval of the holder of such Option. No Options shall be granted or shares
of Common Stock issued hereunder after October 1, 2007; provided that, if the
term of this Plan is otherwise extended, no Incentive Stock Options shall be
granted hereunder after October 1, 2007.
-13-
Schedule A
Investors
---------
Bain Capital Fund IV, L.P.
Bain Capital Fund IV-B, L.P.
BCIP Associates
BCIP Trust Associates, L.P.
Randolph Street Partners
GS Capital Partners, L.P.
Bridge Street Fund 1994, L.P.
Stone Street Fund 1994
-14-