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EXHIBIT 10.31
STOCK OPTION AGREEMENT
June 14, 1999
Xx. Xxxxxxx X. Xxxxxx
Re: Grant of Stock Option
Dear Xxxxxxx:
The Board of Directors of Cooperative Computing Holding Company, Inc.
(the "Company") has adopted the Company's 1998 Stock Option Plan (the "Plan")
for certain individuals, directors and key employees of the Company and its
Related Entities and certain non-employees. A copy of the Plan is being
furnished to you concurrently with the execution of this Option Agreement and
shall be deemed a part of this Option Agreement as if fully set forth herein.
Unless the context otherwise requires, all capitalized terms used but not
otherwise defined herein shall have the meanings given such terms in the Plan
and in that certain Executive Employment Agreement (the "Employment Agreement"),
dated June 14, 1999, between you and Cooperative Computing, Inc. ("CCI");
provided, however, that to the extent definitions in the Plan are different from
definitions in the Employment Agreement, the definitions in the Employment
Agreement will control.
1. The Grant.
Subject to the conditions set forth below, the Company hereby grants to
you, effective as of June 14, 1999 (the "Grant Date"), as a matter of separate
inducement and not in lieu of any salary or other compensation for your
services, the right and option to purchase (the "Option"), in accordance with
the terms and conditions set forth herein and in the Plan, an aggregate of
500,000 shares of Common Stock of the Company (the "Option Shares"), at the
Exercise Price (as hereinafter defined). As used herein, the term "Exercise
Price" shall mean a price equal to $5.00 per share, subject to the adjustments
and limitations set forth herein and in the Plan. The Option granted hereunder
is intended to constitute a Non-Qualified Option within the meaning of the Plan;
however, you should consult with your tax advisor concerning the proper
reporting of any federal or state tax liability that may arise as a result of
the grant or exercise of the Option.
2. Exercise.
(a) For purposes of this Option Agreement, the Option Shares shall be
deemed "Nonvested Shares" unless and until they have become "Vested Shares."
Notwithstanding anything to the contrary contained in Section 6(c) of the Plan,
the Option Shares shall become "Vested Shares" in three equal, consecutive
annual installments on June 14, 2000, June 14, 2001, and June 14, 2002, provided
that vesting shall cease upon your ceasing to be an employee of CCI or a Related
Entity as expressly provided in the Plan. In addition, notwithstanding anything
to the contrary contained in Section 8 of the Plan, all Nonvested
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Shares shall become Vested Shares upon the occurrence of a Change in Control
without the necessity of action by the Committee.
(b) Subject to the relevant provisions and limitations contained herein and
in the Plan, you may exercise the Option to purchase all or a portion of the
applicable number of Vested Shares at any time prior to the termination of the
Option pursuant to this Option Agreement and the Plan. In no event shall you be
entitled to exercise the Option for any Nonvested Shares or for a fraction of a
Vested Share.
(c) The unexercised portion of the Option, if any, will automatically, and
without notice, terminate and become null and void upon the expiration of ten
(10) years from the Grant Date.
(d) Any exercise by you of the Option shall be in writing addressed to the
Secretary of the Company at its principal place of business (a copy of the form
of exercise to be used will be available upon written request to the Secretary),
and shall be accompanied by a certified or bank check payable to the order of
the Company in the full amount of the Exercise Price of the shares so purchased,
or in such other manner as described in the Plan and established by the
Committee.
3. Miscellaneous.
(a) Except as provided in the last sentence of this Section 3(a), this
Option Agreement is subject to all the terms, conditions, limitations and
restrictions contained in the Plan, and in the event of any conflict or
inconsistency between the terms hereof and the terms of the Plan, the terms of
the Plan shall be controlling. Notwithstanding the foregoing, the terms of
Section 2(a) hereof shall control notwithstanding any conflict or inconsistency
between the terms thereof and the terms of the Plan.
(b) This Option Agreement is not a contract of employment, and the terms of
your employment shall not be affected by, or construed to be affected by, this
Option Agreement, except to the extent specifically provided herein. Nothing
herein shall impose, or be construed as imposing, any obligation (i) on the part
of the Company or any Related Entity to continue your employment or (ii) on your
part to remain in the employ of the Company or any Related Entity.
Please indicate your acceptance of all the terms and conditions of the
Option and the Plan by signing and returning a copy of this Option Agreement.
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Very truly yours,
COOPERATIVE COMPUTING HOLDING COMPANY, INC.
By: /s/ XXXXX X. XXXXXX
Name: Xxxxx X. Xxxxxx
Title: Chairman of the Board
ACCEPTED:
/s/ XXXXXXX X. XXXXXX
Xxxxxxx X. Xxxxxx
Date: June 14, 1999