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EXHIBIT 10.53
December 17, 1996
To: Xxxx Xxxxxx
RE: NON-QUALIFIED STOCK OPTIONS
The Board of Directors (the "Board") of Lason, Inc., or the committee
(the "Committee") designated by the Board for the purpose of administering the
Lason, Inc. 1995 Stock Option Plan (the "Plan"), hereby grants you (the
"Grantee") a non-qualified stock option (each an "Option"), pursuant to the
Plan, a copy of which is attached hereto. Certain capitalized terms used in this
agreement (the "Agreement") are defined in paragraph 12 hereof. Certain
capitalized terms used in this Agreement which are not defined herein have the
meanings indicated for such terms in Section 10.1 of the Plan. As used herein
references to the "Company" refer to Lason, Inc. or to Lason, Inc. and/or any of
its Subsidiaries, as applicable.
1. STOCK OPTION. The Option entitles
the Grantee (and such Xxxxxxx's permitted
transferee as described in paragraph 3(a)
below) (each such person, a "Purchaser") to
purchase up to the number of shares of the
Company's Common Stock, par value $.01 per
share (the "Option Shares"), specified below
opposite such Grantee's name, at an option
price of $16.75 per share (the "Option
Price"), subject to the terms and conditions
of this Agreement:
GRANTEE NUMBER OF OPTION SHARES
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Xxxx Xxxxxx 15,000
2. ADDITIONAL TERMS. The Options are
also subject to the following provisions:
(a) EXERCISABILITY. Each Option may be exercised and
Option Shares may be purchased at any time and from time to time after the
execution of this Agreement, subject to the vesting limitations imposed by
paragraph 2(b) of this Agreement. The Option Price for Option Shares shall be
paid in full in cash or by check by the Purchaser of such Option Shares prior to
the time of the delivery of Option Shares, or, at the written request of such
Purchaser, the Committee may (but need not) permit payment to be made by (i)
delivery to the Company of outstanding Shares, (ii) retention by the Company of
one or more of such Option Shares or (iii) any combination of cash, check, such
Purchaser's delivery of outstanding Shares and retention by the Company of one
or more of such Option Shares. Option Shares acquired by Purchaser under this
Agreement are hereinafter referred to as the "Exercise Shares."
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(b) VESTING/EXERCISABILITY.
(1) Purchaser may only exercise the Option to
purchase Option Shares to the extent that such
Option has vested and become exercisable with
respect to such Option Shares. Except as
otherwise provided in Paragraph 2(b)(ii) below,
the Option Shares will vest and become
exercisable in accordance with the following
schedule, if as of each such date the Grantee is
still employed by the Company or any of its
Subsidiaries:
CUMULATIVE PERCENTAGE OF
OPTION SHARES VESTED
DATE AND EXERCISABLE
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December 17, 1997 20%
December 17, 1998 40%
December 17, 1999 60%
December 17, 2000 80%
December 17, 2001 100%
Option Shares which have become vested and exercisable are referred to herein as
"Vested Shares" and all other Option Shares are referred to herein as "Unvested
Shares."
(ii) Upon the occurrence of a Sale of the Company,
each Option shall vest and all Unvested Shares shall be come Vested Shares if,
but only if, the Grantee thereof is employed by the Company or any of its
Subsidiaries on the date of such occurrence.
(c) PROCEDURE FOR EXERCISE. Subject to the vesting
limitations of Paragraph 2(b) above, a Purchaser may exercise all or any portion
of the Option, so long as it is valid and outstanding, at any time and from time
to time prior to its termination by delivering written notice to the Company as
provided in Section 6.4 of the Plan and written acknowledgment substantially in
the form of Exhibit A hereto that such Purchaser has read, and has been afforded
an opportunity to ask questions of the Company's management regarding all
financial and other information provided to Purchaser concerning the Company,
together with payment of the Option Price times the number of Option Shares
purchased. Subject to Section 6.7 of the Plan, at the time of exercise,
Purchaser will be entitled to review all financial and other information
regarding the Company it believes necessary to enable such Purchaser to make an
informed investment decision.
3. TRANSFERABILITY OF THE OPTIONS.
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(a) The Grantee shall not sell, transfer, assign, pledge
or otherwise dispose of (a "Transfer") any interest in any Option with respect
to any Unvested Shares. Any Option with respect to any Vested Shares of the
Grantee shall not be Transferred other than as a result of the death of such
Grantee, testate or intestate, and the restrictions herein shall apply to any
Transfer by any such permitted transferee.
(b) The Company may assign its rights and delegate its
duties under this Agreement.
4. TRANSFERABILITY OF EXERCISE SHARES.
(a) No Purchaser shall Transfer any Exercise Shares or
any interest therein except in accordance with the provisions of this Agreement.
(b) No holder of any Exercise Shares may Transfer any
such shares (except pursuant to an effective registration statement and/or
re-offer prospectus, as applicable, under the Securities Act) without first
delivering to the Company an opinion of counsel (reasonably acceptable in form
and substance to the Company) that neither registration nor qualification under
the Securities Act and applicable state securities laws is required in
connection with such transfer.
5. CONFORMITY WITH PLAN. The Options are intended
to conform in all respects with, and are subject
to all applicable provisions of, the Plan, which
is incorporated herein by reference.
Inconsistencies between this Agreement and the
Plan shall be resolved in accordance with the
terms of the Plan, except as modified by
Paragraph 2(b)(ii) of this Agreement. By
executing this Agreement, the Grantee
acknowledges receipt of the Plan and agrees to be
bound by all of other terms of the Plan.
6. EMPLOYMENT. Notwithstanding any contrary oral
representations or promises made to the Grantee
prior to or after the date hereof, the Grantee
and the Company acknowledge that such Xxxxxxx's
employment with the Company is and will continue
to be subject to the willingness of each to
continue such employment and nothing set forth
herein or otherwise confers any right or
obligation on such Grantee to continue in the
employ of the Company or shall affect in any way
such Grantee's right or the right of the Company
to terminate such Xxxxxxx's employment at any
time, for any reason, with or without cause.
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7. ADJUSTMENT. The Board shall make appropriate
and proportionate adjustments to the terms of the
Options to reflect any stock dividend, stock
split, combination or exchange of shares,
merger, consolidation or other change in the
capitalization of the Company which the Board
determines to be similar, in its substantive
effect upon the Plan or the Options, to any of
the changes expressly indicated in this sentence,
as provided in Article 8 of the Plan. The Board
may (but shall not be required to) make any
appropriate adjustment to the terms of the
Options to reflect any spin-off, spin-out or
other distribution of assets to shareholders or
any acquisition of the Company's stock or assets
or other change which the Board determines to be
similar, in its substantive effect upon the Plan
or the Options, to any of the changes expressly
indicated in this sentence, as provided in
Article 8 of the Plan. In the event of any
adjustments described in the preceding two
sentences, any and all new, substituted, or
additional securities or other property to which
any Purchaser is entitled by reason of the Option
shall be immediately subject to such Option and
be included in the word "Option Shares" for all
purposes of such Option with the same force and
effect as the Option Shares presently subject to
such Option. After each such event, the number of
Option Shares and/or the Option Price shall be
appropriately adjusted.
8. SHARE LEGEND. Unless the Exercise Shares are
the subject of an effective registration
statement and/or re-offer prospectus, as
applicable, all certificates representing any
Exercise Shares subject to the provisions of this
Agreement shall have endorsed thereon the
following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE
ORIGINALLY ISSUED AS OF DECEMBER 17, 1996, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN
EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER AND CERTAIN OTHER AGREEMENTS SET
FORTH IN AN EMPLOYEE STOCK OPTION AGREEMENT BETWEEN THE
COMPANY AND
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CERTAIN EMPLOYEES OF THE COMPANY DATED DECEMBER
17, 1996. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE
HOLDER HEREOF AT THE COMPANY'S PRINCIPAL PLACE OF BUSINESS
WITHOUT CHARGE."
9. INVESTMENT REPRESENTATIONS. Upon the
purchase of Option Shares hereunder, the
Purchaser thereof shall execute and deliver to
the Company a letter, substantially in the form
attached hereto as Exhibit A, confirming such
Purchaser's investment representations.
10. EXPIRATION. Subject to Sections 6.3 and 6.7 of
the Plan, the Grantee's Option shall expire (a)
with respect to Vested Shares, at the earlier of
(i) a determination by the Option Committee that
the Grantee has been grossly negligent in the
performance of his duties to the Company,(ii) the
termination of such Grantee's employment with the
Company or (iii) at 5:00 p.m., Detroit time, on
the seventh anniversary of the date hereof and
(b) with respect to Unvested Shares, upon the
termination of such Xxxxxxx's employment with the
Company.
Further, notwithstanding the above, with respect to Vested
Shares, if the termination of Xxxxxxx's employment with the Company is due to
death, disability or Termination Without Cause, then the Option shall expire on
the earlier of (i) the 90th day following the termination of Grantee's
employment or (ii) until 5:00 p.m., Detroit time, on the seventh anniversary of
the date hereof.
Further, notwithstanding the above, with respect to Vested
Shares, if the Company discovers after termination of Xxxxxxx's employment, that
Xxxxxxx engaged in conduct that would have justified Termination for Cause,
Xxxxxxx's Option shall expire immediately on the date of such discovery.
11. CONFIDENTIALITY/NON-COMPETITION. In
consideration of the Option granted herein,
Xxxxxxx agrees that while Xxxxxxx is
employed by the Company and for the
eighteen (18) month period following the
date of employment, Grantee shall not,
either directly or indirectly (whether as
sole proprietor, partner, consultant,
venturer, member, stockholder, director,
officer,
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employee, or in any other capacity as
principal or agent), own, manage, operate,
control, finance, or engage or participate
in the ownership, management, operation or
control of, any person, firm, entity,
limited partnership, partnership, limited
liability company, corporation, or similar
association which is engaged in any of the
business activities of the Company and
which is located in any part of the United
States or Canada in which the Company does
business.
Xxxxxxx further agrees that Grantee shall not, directly or
indirectly, at any time during such eighteen (18) month non-compete period:
(a) take any action that will cause the termination of a
business relationship between the Company and any customer or supplier of the
Company; or
(b) solicit for employment or employ any person employed in
the Company's business.
At all times, Grantee shall keep secret and inviolate all
knowledge or information of a confidential nature, including, without
limitation, all unpublished matters relating to the business, assets, accounts,
books, records, customers and contracts of the Company which Grantee may or
hereafter come to know as a result of Xxxxxxx's association with the Company.
Xxxxxxx acknowledges that if Grantee violates this Paragraph
11, Grantee will cause severe and irreparable injury to the business and
goodwill of the Company, which injury is not adequately compensable by money
damages. Accordingly, in the event of a breach (or threatened or attempted
breach) of this Paragraph 11, the Company shall, in addition to any other rights
and remedies, (i) be entitled to immediate appropriate injunctive relief or a
decree of specific performance of this Agreement, without the necessity of
showing any irreparable injury or special damages, and (ii) not be obligated to
sell any shares subject to the option upon exercise of the option.
Xxxxxxx acknowledges that, due to Xxxxxxx's education and job
skill, Xxxxxxx's adherence to the terms of this confidentiality/non-competition
provision will not deprive Grantee of the opportunity to obtain gainful
employment with other companies serving different product or geographic markets
after the termination of Grantee's employment with the Company.
Nothing herein shall be deemed to prevent Grantee from holding
less than five (5%) percent of the outstanding publicly-traded securities of any
person, firm, or corporation.
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The provisions of this Paragraph 11 shall survive the
termination of this Agreement and Xxxxxxx's employment with the Company.
12. DEFINITIONS.
"DISABILITY" means permanent and total disability as such term
is defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended.
"FULLY DILUTED BASIS" means, without duplication, (i) all
shares of Common Stock outstanding at the time of determination plus (ii) all
shares of Common Stock issuable upon conversion of any convertible securities or
the exercise of any option, warrant or similar right, whether or not such
conversion, right or option, warrant or similar right is then exercisable.
"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 the Company or 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.
"SALE OF THE COMPANY" means the sale of the Company (by
merger, consolidation or sale of stock or assets) to an Independent Third Party
or group of Independent Third Parties pursuant to which such party or parties
acquire (i) capital stock of the Company possessing the voting power under
normal circumstances to elect a majority of the Board (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.
The Sale of the Company does not include a sale of stock pursuant to a secondary
public offering by the Company.
"TERMINATION FOR CAUSE" means termination by the Company of
Xxxxxxx's employment because of Xxxxxxx's personal dishonesty, willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties, or the lawful violation of any law, rule or
regulation (other than minor traffic violations or similar offenses).
"TERMINATION WITHOUT CAUSE" means any termination by the
Company of Grantee's employment which is not a Termination for Cause.
13. FURTHER ACTIONS. The parties agree to
execute such further instruments and to take
such further actions as may reasonably be
required to carry out the intent of this
Agreement.
14. SEVERABILITY. Whenever possible, each
provision of this Agreement will be
interpreted in such manner as to be
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effective and valid under applicable law,
but if any provision of this Agreement is
held to be prohibited by or invalid under
applicable law, such provision will be
ineffective only to the extent of such
prohibition or invalidity, without
invalidating the remainder of this
Agreement.
15. COUNTERPARTS. This Agreement may be
executed simultaneously in two or more
counterparts, any one of which need not
contain the signatures of more than one
party, but all such counterparts taken
together will constitute one and the same
Agreement.
16. NOTICES. Any notice required or
permitted hereunder shall be given in
writing and shall be deemed effectively
given upon personal delivery or upon deposit
in the United States Post Office, by
registered or certified mail with postage
and fees prepaid, addressed, in the case of
a Grantee, and, in the case of the Company,
to the respective addresses below:
Lason, Inc.
0000 Xxxxxxxxxx Xxxxxxx
Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Executive Vice President
Xx. Xxxx Xxxxxx
000 Xxxx Xxxxxxxxx Xxxxx
Xxxxxxxxxx Xxxxx, XX 00000-0000
or at such other address as a party may designate by 10 days advance written
notice to each other party.
17. SUCCESSORS AND ASSIGNS. This Agreement
shall be binding upon and inure to the
benefit of the successors and assigns of the
Company and, subject to the restrictions on
transfer herein set forth, be binding upon
Xxxxxxx's heirs, executors, administrators,
successors and assigns and inure to the
benefit of Xxxxxxx's heirs, executors,
administrators, successors and permitted
assigns.
18. GOVERNING LAW. This Agreement and all
documents contemplated hereby, and all
remedies in connection therewith and all
questions or transactions
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relating thereto, shall be construed in
accordance with and governed by the laws of
the State of Michigan.
19. ENTIRE AGREEMENT. This Agreement and
the Plan constitute the entire understanding
between the Grantee and the Company, and
supersede all other agreements, whether
written or oral, with respect to the
acquisition by the Grantee of Common Stock
from the Company pursuant to any option or
option agreement.
Please sign as Grantee the extra copy of this Agreement in the
space below and return it to the Secretary of the Company, Xxxxxxx X.
Xxxxxxxxxx, to confirm your understanding and acceptance of the agreements
contained in this letter.
Very truly yours,
LASON, INC.
By:
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Xxxxxxx X. Xxxxxxxxxx
Its: Executive Vice President
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THE UNDERSIGNED hereby acknowledges having read this
Agreement, the Plan, and the other enclosures to this Agreement, and hereby
agrees to be bound by all provisions set forth herein and in the Plan.
GRANTEE
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Xxxx Xxxxxx
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