FIRST AMENDMENT
TO
AMENDED AND RESTATED STOCK OPTION AGREEMENT
This First Amendment (the "AMENDMENT") to the Amended and Restated Stock
Option Agreement between Diversified Corporate Resources, Inc. (the "COMPANY")
and M. Xxx Xxxxxxx ("OPTIONEE") is adopted pursuant to the terms of Article VIII
of the Diversified Corporate Resources, Inc. Amended and Restated 1996 Stock
Option Plan ("PLAN").
WHEREAS, the Company has granted Optionee an option (the "OPTION") the
terms of which are set forth in an Amended and Restated Stock Option Agreement
to purchase a certain number of shares (individually and collectively, "SHARES")
of the Company's common stock; and
WHEREAS, the Board has proposed that the vesting provisions of the Option
should provide for acceleration of its vesting in the event of a change in
control of the Company and a subsequent termination of the Optionee's employment
with the Company under certain circumstances and has further proposed that the
same provisions should apply to the Option; and
WHEREAS, the Board therefor has proposed to amend the Option to provide
that, upon a "Special Change in Control" (as described below) Optionee will
become fully vested in his Shares upon a subsequent termination of employment
under the circumstances described below occurring prior to the final vesting
date under the terms of the Option; and
WHEREAS, the Board has approved this First Amendment; and
WHEREAS, the Optionee desires to enter into this First Amendment.
NOW, THEREFORE, in consideration of the premises, the Option is amended as
follows:
1. Paragraph 2 is amended by adding to the end thereof a new
paragraph as follows:
"If (i) a "Special Change in Control" occurs, and
(ii) Optionee's employment with the Company terminates for
any reason other than Voluntary Resignation or Termination
for Cause during the twenty-four (24) month period beginning
on the Effective Date (as reasonably determined by the
Committee) of such Change in Control, then, notwithstanding
any provision of this Agreement to the contrary, and without
limitation, this Option will become
exercisable with respect to all of the Shares subject to this
Option, at the exercise prices at which the Option would have
become exercisable if Optionee had continued in employment through
the dates set forth in the preceding paragraph on which the Option
would have been exercisable with respect to all of the Shares
subject to this Option and will terminate as provided herein.
"For all purposes hereof, "Voluntary Termination" shall mean
the Optionee's resignation from the Company unless such
resignation is as a direct proximate result of (i) without
Optionee's express written consent, the assignment to
Optionee of any duties materially inconsistent with his
positions, duties, responsibilities and status (including
his removal form the Board of Directors) with the Company on
the Effective Date of the Special Change in Control; (ii) a
reduction of Optionee's base compensation and bonus
compensation (other than a reduction in payments under the
Company's incentive bonus program based on a reduction in
net profits of the Company) to an amount that is greater
than ten percent (10%) lower than such compensation on the
Effective Date of the Special Change In Control;
(iii) relocation of Optionee's principal location of work to
any location that is both (x) in excess of fifty (50) miles
from the location of Optionee's principal location of work
on the Effective Date or the Special Change in Control, and
(y) in excess of the sum of the distance from Optionee's
principal residence on such Effective Date to the location
of the Optionee's principal location of work on such
Effective Date, plus 50 miles; (iv) failure by the Company
to require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the
Company, by agreement in form and substance reasonably
satisfactory to the Optionee, expressly to assume and agree
to perform his Employment Agreement and this Agreement in
the same manner and to the same extent that the Company
would be required to perform it if no such succession had
taken place; or (v) any material breach of his Employment
Agreement as in effect on the Effective Date of the Special
Change in Control, or this Agreement, by the Company.
"For all purposes hereof, "Termination For Cause" shall mean
Optionee's termination for cause under his
Employment Agreement as in effect on the Effective Date of the
Special Change in Control or if Optionee does not have an
Employment Agreement in effect on the Effective Date of the Special
Change in Control, "termination for cause" shall mean any of the
following events: (i) the Optionee's conviction or plea of guilty
to a crime involving moral turpitude, (ii) any acts of dishonesty
or theft on the part of the Optionee that, in the opinion of the
Board of Directors of the Company, is detrimental to the best
interests of the Company, and (iii) intentional and material
violation by the Optionee of any written policy of the Board of
Directors of the Company that is not corrected within ninety (90)
days after receipt by the Optionee of a detailed written
explanation from the Board of Directors of the Company, all as
reasonably determined by the Committee in its sole discretion."
2. Paragraph 5 is amended by renaming it "RECLASSIFICATION,
CONSOLIDATION, MERGER AND SPECIAL CHANGE IN CONTROL", and deleting the
second sentence and adding in lieu thereof the following:
"(b) For all purposes hereof "Special Change in Control" means
(i) any person or entity, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), other than the Company, a
majority-owned subsidiary thereof, or J. Xxxxxxx Xxxxx ("Xxxxx")
and any affiliate of Xxxxx, becomes the beneficial owner (as defined
pursuant to Schedule 13(d) under the Exchange Act) of the
Company's securities having 25% or more of the combined voting
power of the then outstanding securities of the Company that may
be cast for the election of directors of the Company; or (ii) as
the result of, or in connection with, any cash tender or exchange
offer, merger or other business combination, sales of assets or
contested election, or any combination of the foregoing
transactions, less than a majority of the combined voting power
of the then outstanding securities of the Company or any
successor corporation or entity entitled to vote generally in the
election of the directors of the Company or such other
corporation or entity after such transaction are beneficially
owned (as defined pursuant to Section 13(d) of the Exchange Act)
in the aggregate by the holders of the Company's securities
entitled to vote generally in the election of directors of the
Company immediately prior to such transaction; or (iii) during
any period of two consecutive years, individuals who at the
beginning of any such period constitute the Board of Directors
of the Company
cease for any reason to constitute at least a majority thereof,
unless the election, or the nomination for election by the
Company's shareholders, of each director of the Company first
elected during such period was approved by a vote of at least
two-thirds of the directors of the Company then still in office who
were directors of the Company at the beginning of any such period.
The "Effective Date" of such Special Change in Control shall be the
earlier of the date on which an event described in (i), (ii), or
(iii) occurs, or if earlier, the date of the occurrence of (iv) the
approval by shareholders of an agreement by the Company, the
consummation of which would result in an event described in (i),
(ii), or (iii), or (v) the acquisition of beneficial ownership (as
defined pursuant to Section 13(d) of the Exchange Act), directly or
indirectly, by any entity, person or group (other than the Company,
a majority-owned subsidiary of the Company, or Xxxxx and any
affiliate of Xxxxx) of securities of the Company representing 5% or
more of the combined voting power of the Company's outstanding
securities, provided, however, that the events described in (iv)
and (v) will be considered the Effective Date of a Special Change
in Control if they are followed within six (6) months by an event
described in (i), (ii) or (iii)."
3. Paragraph 7 is renamed PLAN PROVISIONS AND BINDING EFFECT and is
amended and restated to read as follows:
The Agreement is in all respects subject to the
terms, definitions and provisions of the Plan, all
of which are incorporated herein by reference.
This Agreement shall be binding upon and inure to
the benefit of the Company, the Optionee, and
their respective heirs, representatives,
successors, and assigns.
4. A new paragraph 10 will be added as follows:
COMMITTEE AUTHORITY. Any questions concerning the
interpretation of this Agreement shall be
determined by the Committee in its reasonable
discretion.
5. The effective date of the First Amendment shall be April 30, 1998.
6. Except as amended by the First Amendment, the terms of the Option
shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
be executed as of this _____ day of September, 1998.
DIVERSIFIED CORPORATE RESOURCES, INC.
By:
Name:
Title:
OPTIONEE
M. Xxx Xxxxxxx
