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EXHIBIT (d)(3)
EMERITUS CORPORATION
1995 STOCK INCENTIVE PLAN
NONQUALIFIED STOCK OPTION LETTER AGREEMENT
TO: Name Date of Xxxxx: Date
We are pleased to inform you that you have been selected by the Plan
Administrator of the Emeritus Corporation (the "Company") 1995 Stock Incentive
Plan (the "Plan") to receive a nonqualified option for the purchase of # shares
of the Company's Common Stock at an exercise price of $XX.XX per share. A copy
of the Plan is attached and incorporated into this Agreement by reference.
The terms of the option are as set forth in the Plan and in this
Agreement. This Agreement is subject to and in accordance with the express terms
and conditions of the Plan and is in all respects limited by and subject to the
express terms and provisions of the Plan. The most important of the terms set
forth in the Plan are summarized as follows:
TERM: The term of the option is ten years from date of grant, unless
sooner terminated.
VESTING: The option shall vest and become exercisable according to the
following schedule:
DATE ON AND AFTER WHICH PORTION OF TOTAL OPTION
OPTION IS EXERCISABLE WHICH IS EXERCISABLE
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Date #
Date #
Date #
Date #
Date #
TERMINATION: Unless otherwise determined at any time by the Plan
Administrator, the option will terminate immediately upon termination for cause,
as defined in the Plan, or three years after termination of service as a result
of retirement, early retirement at the Company's request, disability, or death
or three months after all other terminations, but in each case not later than
the remaining term of the option.
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EXERCISE: During your lifetime only you can exercise the option. The
Plan also provides for exercise of the option by the personal representative of
your estate, by the beneficiary you have designated on forms prescribed by and
filed with the Company (a "Designated Beneficiary"), or the beneficiary of your
estate following your death. You may use the Notice of Exercise of Nonqualified
Stock Option in the form attached to this Agreement when you exercise the
option. Please note that a different Notice of Exercise form will be required
if, at the time of exercise, the Company does not have an effective registration
statement for the shares to be issued pursuant to the exercise.
PAYMENT FOR SHARES: The option may be exercised by the delivery of:
(a) Cash, personal check (unless, at the time of exercise, the Plan
Administrator determines otherwise), bank certified or cashier's check;
(b) Unless the Plan Administrator in its sole discretion determines
otherwise, shares of the capital stock of the Company held by you for a period
of at least six months having a fair market value at the time of exercise, as
determined in good faith by the Plan Administrator, equal to the exercise price;
or
(c) A properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company the amount of sale
or loan proceeds to pay the exercise price.
WITHHOLDING TAXES: As a condition to the exercise of a nonqualified
stock option, you shall make such arrangements as the Company may require for
the satisfaction of any federal, state or local withholding tax obligations that
may arise in connection with such exercise. The Company shall have the right to
retain without notice sufficient shares of stock to satisfy the withholding
obligation. To the extent permitted or required by the Company, you may satisfy
the withholding obligation by electing to have the Company or related
corporation withhold from the shares to be issued upon exercise that number of
shares having a fair market value equal to the amount required to be withheld.
INDIVIDUALS SUBJECT TO SECTION 16 OF THE EXCHANGE ACT MUST COMPLY WITH CERTAIN
REQUIREMENTS IN ORDER TO MAKE SUCH ELECTION.
TRANSFER OF OPTION: The option is not transferable except by will, to a
Designated Beneficiary, or by the applicable laws of descent and distribution.
HOLDING PERIOD: If an individual subject to Section 16 of the Exchange
Act sells shares of Common Stock obtained upon the exercise of a stock option
within six months after the date the option was granted, such sale may result in
short-swing profit recovery under Section 16(b) of the Exchange Act.
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REGISTRATION: AT THE PRESENT TIME, THE COMPANY INTENDS TO FILE AND
MAINTAIN AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THE SHARES THAT
WILL BE ISSUED UPON THE EXERCISE OF THIS OPTION. THE COMPANY INTENDS TO MAINTAIN
THIS REGISTRATION BUT HAS NO OBLIGATION TO DO SO. IN THE EVENT THAT SUCH
REGISTRATION IS NO LONGER EFFECTIVE, YOU WILL NOT BE ABLE TO EXERCISE THE OPTION
UNLESS EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE SECURITIES LAWS ARE
AVAILABLE; SUCH EXEMPTIONS FROM REGISTRATION ARE VERY LIMITED AND MIGHT BE
UNAVAILABLE.
Please execute the Acceptance and Acknowledgment set forth below on the
enclosed copy of this Agreement and return it to the undersigned.
Very truly yours,
EMERITUS CORPORATION
By
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ACCEPTANCE AND ACKNOWLEDGMENT
GRANT DATE: Date
I, a resident of the State of ___________________, accept the
nonqualified stock option described above and in the Emeritus Corporation 1995
Stock Incentive Plan, and acknowledge receipt of a copy of this Agreement and a
copy of the Plan. I have read and understand the Plan, including the provisions
of Section 18.3.
Dated:
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Taxpayer I.D. Number Name
Address
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By his or her signature below, the spouse of the Optionee, if such
Optionee is legally married as of the date of his or her execution of this
Agreement, acknowledges that he or she has read this Agreement and the Plan and
is familiar with the terms and provisions thereof, and agrees to be bound by all
the terms and conditions of this Agreement and the Plan.
Dated:
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Spouse's Signature
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Printed Name
By his or her signature below, the Optionee represents that he or she is
not legally married as of the date of execution of this Agreement.
Dated:
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Optionee's Signature
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NOTICE OF EXERCISE OF NONQUALIFIED STOCK OPTION
To: Emeritus Corporation
I, a resident of the State of ___________________, hereby exercise my
nonqualified stock option granted by Emeritus Corporation (the "Company") on
_____________, 19___, subject to all the terms and provisions thereof and of the
1995 Stock Incentive Plan referred to therein, and notify the Company of my
desire to purchase ________ shares of Common Stock of the Company (the
"Securities") at the exercise price of $__________ per share which were offered
to me pursuant to said option.
I hereby represent and warrant that (1) I have been furnished with a
copy of the Plan and all information which I deem necessary to evaluate the
merits and risks of the purchase of the Securities; (2) I have had the
opportunity to ask questions and receive answers concerning the information
received about the Securities and the Company; and (3) I have been given the
opportunity to obtain any additional information I deem necessary to verify the
accuracy of any information obtained concerning the Securities and the Company.
Dated:
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Taxpayer I.D. Number
Address
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RECEIPT
______________________ hereby acknowledges receipt from Name in payment
for ________ shares of Common Stock of Emeritus Corporation, a Washington
corporation, of $___________________ in the form of
Cash
Check (personal, cashier's or bank certified)
__________ shares of the Company's Common Stock, fair
market value $_______ per share, held by the optionee
for a period of at least six months
Copy of irrevocable instructions to Broker
Date:
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For: Emeritus Corporation
