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EXHIBIT 10.23
Xxxxxxxxxx Option Grants
AMN HOLDINGS, INC.
1999 PERFORMANCE STOCK OPTION PLAN
Nonqualified Stock Option Agreement
STOCK OPTION AGREEMENT dated November 20, 2000, between AMN
HOLDINGS, INC., a Delaware corporation (the "Company"), and Xxxxx X.
Xxxxxxxxxx (the "grantee").
All words and phrases not otherwise expressly defined herein shall
have the same meanings as are ascribed to such words and phrases in the Plan
document.
The Committee has determined that the objectives of the Plan will be
furthered by granting to the grantee an option pursuant to the Plan.
In consideration of the foregoing and of the mutual undertakings set
forth in this Stock Option Agreement, the Company and the grantee agree as
follows:
SECTION 1. Grant of Option. The Company hereby grants to the grantee a
nonqualified stock option to purchase 3,124 shares of Stock at a purchase price
of $163.9743 per share.
SECTION 2. Exercisability.
(a) In General. Subject to Section 4 hereof, the option shall
become vested and exercisable if, and only if certain performance targets are
met, as follows:
Number of Shares as to which
Fiscal Year EBITDA Option Becomes Exercisable
----------- ------ --------------------------
2000 at least $18,915,000 781
2001 at least $22,685,000 781
2002 at least $39,865,000 781
2003 at least $45,856,000 781
Any portion of the option that becomes exercisable pursuant to the above
shall become exercisable as of the date of delivery of audited financial
statements by the Company's independent auditor for the applicable Fiscal Year
(in each case, the "Fiscal Year Vesting Date"), provided that the grantee was
employed on the last day of the applicable Fiscal Year.
(b) Change of Control Acceleration. Notwithstanding the
foregoing, in the event a Change of Control occurs prior to December 31, 2003,
in which the net proceeds actually received by HWH Capital Partners, L.P. and
its affiliates (collectively, "HWP") in the form of cash and marketable
securities exceeds, on an aggregate basis (after taking into account any prior
sales by HWP of any portion of its
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investment in the Company), $491.92 per share of Stock, the portion of the
option which was eligible to become vested pursuant to Section 2(a) with respect
to the Fiscal Year in which a Change of Control occurs and, if any, later Fiscal
Years shall become exercisable, effective immediately prior to such event.
(c) Expiration of Option.
(i) Generally. Subject to the provisions of this
Section 2(c) and Section 4, the option shall
terminate and cease to be exercisable on December
31, 2009.
(ii) Special Rule. Notwithstanding the provisions of
Section 2(c)(i), if the Company does not meet the
performance target established in Section 2(a) for
a Fiscal Year, that portion of the option which
was eligible to become vested with respect to such
Fiscal Year shall immediately terminate.
SECTION 3. Method of Option Exercise. The option or any part thereof may
be exercised only by giving to the Company written notice of exercise in the
form prescribed by the Committee. Full payment of the purchase price shall be
made on the option exercise date by certified or official bank check or, in the
Committee's discretion (which shall not be unreasonably withheld), by personal
check (subject to collection), payable to the Company, or delivery of shares of
Stock already owned by the grantee for at least six months prior to the option
exercise date as described in Section 5.4(b)(iii) of the Plan. The grantee shall
have no right to pay the option exercise price, or to receive shares of Stock
with respect to an option exercise, prior to the option exercise date. For
purposes of this Stock Option Agreement, the "option exercise date" shall be
deemed to be the first business day immediately following the date written
notice of exercise is received by the Company.
SECTION 4. Termination of Employment.
(a) Unvested Options.
(i) General Rule. All unvested portions of an option granted
to a grantee shall terminate and no longer be exercisable upon such
grantee's termination of employment for any reason, except to the
extent that options may become exercisable post-employment in
accordance with Section 5.5 of the Plan or may remain eligible for
vesting pursuant to Section 4(a)(ii) of this Agreement.
(ii) Termination Before Performance Verified. Notwithstanding
Section 4(a)(i), if a grantee terminates employment after the end of
a Fiscal Year, but before the Fiscal Year Vesting Date (if
applicable), the portion of such grantee's option that was eligible
to vest upon delivery of audited financial statements confirming
that performance
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targets were met for such Fiscal Year shall remain outstanding and
eligible for vesting until delivery of such audited financial
statements. Therefore, the unvested portion of such option shall
immediately terminate and the treatment of the vested portion of the
option shall be governed by Section 4(b).
(b) Vested Options.
(i) Death and Disability. Unless otherwise provided herein, if
a grantee's employment with the Company and its subsidiaries
terminates by reason of death or Disability (as defined in a
grantee's employment agreement, if applicable, or if not applicable,
as defined in section 22(e)(3) of the Code), the portion, if any, of
the option granted to such grantee which was exercisable immediately
prior to such termination of employment or which becomes exercisable
thereafter in accordance with Section 4(a)(ii) of this Agreement may
be exercised by such grantee or, as the case may be, by such
grantee's court-appointed legal representative or, in the case of
the grantee's death, by the person or persons to whom such option
passes under the grantee's will (or, if applicable, pursuant to the
laws of descent and distribution) until the earlier of (x) the later
of (1) one year after the grantee's termination by reason of death
or Disability and (2) with respect to any portion of the option that
vests in accordance with Section 4(a)(ii) of this Agreement, one
year after the date of delivery of audited financial statements, and
(y) the date on which such portion of the option terminates or
expires in accordance with the provisions of the Plan and the other
provisions of this Stock Option Agreement.
(ii) Regular Termination; Leaves of Absence. Unless otherwise
provided herein, if the grantee's employment terminates for reason
other than as provided in Section 4(b)(i), the portion, if any, of
the option granted to such grantee which was exercisable immediately
prior to such termination of employment or which becomes exercisable
thereafter in accordance with Section 4(a)(ii) of this Agreement may
be exercised by such grantee until the earlier of (x) the later of
(1) 90 days after the grantee's date of termination and (2) with
respect to any portion of the option that vests in accordance with
Section 4(a)(ii) of this Agreement, 90 days after the date of
delivery of audited financial statements, and (y) the date on which
such option terminates or expires in accordance with the provisions
of the Plan and the other provisions of this Stock Option Agreement.
The Committee may in its discretion determine (A) whether any leave
of absence (including short-term or long-term disability or medical
leave) shall constitute a termination of employment for purposes of
the Plan and (B) the impact, if any, of any such leave on
outstanding options under the Plan.
(c) Right of Discharge Reserved. Nothing in the Plan or this Stock
Option Agreement shall confer upon the grantee or any other person the right to
continue
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in the employment of the Company or any of its subsidiaries or affect any right
which the Company or any of its subsidiaries may have to terminate the
employment of the grantee or any other person.
SECTION 5. Withholding Tax Requirements. Shares of Stock deliverable to
the grantee upon exercise, pursuant to the terms of the Plan and this Stock
Option Agreement, shall be subject to income tax withholding as provided in
Section 10 of the Plan. Subject to the Committee's consent (which shall not be
unreasonably withheld), a grantee may elect to satisfy all or part of such
requirements by delivery of unrestricted shares of Stock owned by the grantee as
provided in Section 10.2 of the Plan.
SECTION 6. Agreement Provisions to Prevail. This Stock Option Agreement
shall be subject to all of the terms and provisions of the Plan, which are
incorporated hereby and made a part hereof, including, without limitation, the
provisions of Section 8 of the Plan (generally relating to consents required by
securities and other laws) and Section 11 of the Plan (generally relating to the
effects of certain reorganizations and other extraordinary transactions and
providing the Committee with the ability to adjust performance targets). In the
event there is any inconsistency between the provisions of this Stock Option
Agreement and the Plan, the provisions of this Stock Option Agreement shall
govern.
SECTION 7. Grantee's Acknowledgments. By entering into this Stock Option
Agreement, the grantee agrees and acknowledges that (a) he has received and read
a copy of the Plan, including Section 14.3 of the Plan (generally relating to
waivers of claims to continued exercisability of awards, damages and severance
entitlements related to non-continuation of awards), and accepts this option
upon all of the terms thereof, and (b) no member of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any award thereunder or under this Stock Option Agreement.
SECTION 8. Stockholder Restrictions.
(a) Restrictions on Transfer of Stock Acquired by Option Exercise.
(i) Limitation on Transfer. The grantee shall not sell, give,
assign, hypothecate, pledge, encumber, grant a security interest in
or otherwise dispose of (whether by operation of law or otherwise)
(each a "transfer") any Stock or any right, title or interest
therein or thereto, except in accordance with the provisions of this
Agreement. Any attempt to transfer any Stock or any rights hereunder
in violation of the preceding sentence shall be null and void ab
initio.
(ii) Permitted Transfers. At any time after December 31, 2003,
the grantee may, subject to this Section 8(a)(ii), Section 8(a)(iii)
and Section 8(b), transfer all, but not less than all, of the Stock
owned by the grantee to any Person other than a Person involved with
the medical or employee staffing industry other than through the
Company (each a
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"Permitted Transferee"); provided that the consideration for such
transfer shall consist solely of cash. No such transfer to a
Permitted Transferee shall be effective unless such Permitted
Transferee becomes a party to a separate agreement setting forth
substantially the same terms as this Section 8. No Permitted
Transferee of Stock pursuant to this Section 8(a)(ii) shall
thereafter re-transfer such Stock except in accordance with this
Section 8(a)(ii) and Section 8(a)(iii).
(iii) Permitted Transfer Procedures. The grantee shall give
notice to the Company and AMN Acquisition Corp., a Delaware
corporation ("AMN") of its intention to make any transfer permitted
under Section 8(a)(ii) not less than thirty (30) calendar days prior
to effecting such transfer, which notice shall state the name and
address of the party to whom such transfer is proposed and the Stock
proposed to be transferred.
(b) Proposed Voluntary Transfers by the Grantee; Right of First
Refusal.
(i) Offering Notice. If after December 31, 2003 the grantee
has received a bona fide offer from a Person (the "Third Party
Purchaser") to pay for cash (a "Third Party Offer") all of its Stock
(the "Offered Stock") and the grantee desires to accept the Third
Party Offer, then the grantee (the "Selling Stockholder") shall make
an offer (the "Offer") to sell the Offered Stock to AMN and the
Company by sending written notice (the "Offering Notice") to the
Company and AMN, which notice shall state (x) the number of shares
of Offered Stock and (y) all material terms and conditions of such
proposed sale (including the proposed purchase price per share of
Stock).
(ii) Offer Price. Upon receipt of the Offering Notice, AMN or
its designee and the Company (to the extent that AMN or its designee
does not exercise its right of first refusal for the Offered Stock)
shall have the right, but not the obligation, to purchase
collectively all, but not less than all, of the Offered Stock. If
the Offer is accepted by AMN's designee, AMN shall remain
responsible for such designee's performance hereunder. The right of
first refusal shall be exercisable with respect to the Offered Stock
(i) by AMN or its designee and (ii) by the Company, to the extent
that AMN or its designee does not exercise its right of first
refusal for all of the Offered Stock, by written notice to the
Selling Stockholder (with a copy to the Company) within twenty (20)
calendar days (in the case of AMN) and within thirty (30) calendar
days (in the case of the Company) of receipt of the Offering Notice.
Failure by AMN or the Company to respond within the applicable
Notice Period shall be regarded as a rejection of the Offer.
(iii) Sell Option. If all of the Offered Stock has not been
acquired by AMN or its designee or the Company, the Selling
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Stockholder(s) shall have the right to sell such Stock to the Third
Party Offeror on the terms and conditions of the Third Party Offer;
provided, that any such sale must be consummated within 45 calendar
days of the date of the Offering Notice; provided however, that if
compliance with the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976 is necessary to consummate such sale, the 45-day period may be
extended to the end of the waiting period thereunder (but in no
event to more than 75 calendar days after the date of the Offering
Notice). In the event that such sale is not consummated within such
45-day period (as extended if applicable) for any reason, then the
restrictions provided for herein shall again become effective, and
no transfer of such Offered Stock may be made thereafter by such
Selling Stockholder(s) without again complying with this Section
8(b)(iii).
(c) Drag-Along Right.
(i) Sale of the Company. In the event AMN (the "Initiating
Seller") proposes to sell any of its Stock in one or more related
transactions, including without limitation, a merger or
consolidation (a "Drag-Along Sale") to a bona fide third party
purchaser (the "Proposed Transferee") on an arm's length basis, the
Initiating Seller shall have the right (the "Drag-Along Right") to
require the grantee (the "Drag-Along Seller") to sell, and the
Drag-Along Seller hereby agrees to sell, to the Proposed Transferee:
(1) Until AMN has sold (or will have sold as a result of such
sale (assuming no tag-along rights are exercised on such sale)) Stock to a third
party in an amount equal to at least 75 percent (75%) of the Stock owned by AMN
as of the date hereof (the "Threshold Event"), that number of shares of Stock
(but not less than such number of shares of Stock) which is equal to the product
of (x) the number of Shares held by the grantee and (y) a fraction (A) the
numerator of which is the number of outstanding shares of Stock proposed to be
sold by the Initiating Seller and (B) the denominator of which is the number of
shares of Stock owned by the Initiating Seller; and
(2) from and after the Threshold Event, all, but not less than
all, of its Stock (such amount referred to in clause (1) or (2), as the case may
be, for the grantee being herein referred to as the "Drag-Along Amount").
(ii) Sale Notice. The Initiating Seller shall notify the
Company, and the Company shall promptly notify the Drag-Along Seller
in writing of such proposed Transfer (the "Sale Notice"). The Sale
Notice shall set forth (a) the name and address of the Proposed
Transferee and (b) a copy of the written proposal pursuant to which
the Drag-Along Sale will be effected, containing all of the material
terms and conditions thereof, including (1) the number of shares of
Stock (calculated on a fully diluted, as converted basis) proposed
to be transferred by the Initiating Seller, (2) the applicable
Drag-Along Amount, (3) the price per share of
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Stock to be paid, (4) the terms and conditions of payment offered by
the Proposed Transferee, (5) whether the Initiating Seller has
determined to exercise the Drag-Along Right, (6) in the event the
Initiating Seller has determined to exercise the Drag-Along Right,
that the Proposed Transferee has been informed of the Drag-Along
Right provided for in this Section 8(c) and has agreed to purchase
the applicable Drag-Along Amount in accordance with the terms hereof
and (7) the date and location of and procedures for selling Stock to
the Proposed Transferee.
(iii) Purchase of Drag-Along Amount. The Stock purchased from
the Drag-Along Seller by the Proposed Transferee pursuant to this
Section 8(c) shall be paid for at the same price per share and upon
terms and conditions no less favorable than the terms and conditions
applicable to the Stock to be sold by the Initiating Seller.
(d) Stock Certificate Legend; Recording of Transfer. A copy of this
Agreement shall be filed with the Secretary of the Company and kept with the
records of the Company. Each certificate representing Stock now held or
hereafter acquired by the grantee shall, at the option of the Company, for as
long as this Section 8 is effective, bear a legend as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SUCH ACT
AND UNDER ANY APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL
SATISFACTORY TO THE ISSUER HEREOF THAT SUCH REGISTRATION IS NOT REQUIRED
AS TO SUCH SALE OR OFFER.
THE TRANSFER AND PLEDGE OF ANY OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE IS RESTRICTED BY THE TERMS OF THIS STOCK OPTION AGREEMENT
DATED AS OF NOVEMBER 20, 2000, AMONG THE COMPANY AND THE GRANTEE, A COPY
OF WHICH MAY BE INSPECTED AT THE COMPANY'S PRINCIPAL OFFICE.
(e) All Transfers in Compliance with Law and Subject to this
Agreement. Any transfer of Stock permitted or required by this Agreement must be
in compliance with the applicable provision of this Agreement and with federal
and state securities laws, including, without limitation, the Securities Act.
(f) Specific Performance. The parties hereto intend that each of the
parties have the right to seek damages and/or specific performance in the event
that any
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other party hereto fails to perform such party's obligations hereunder.
Therefore, if any party shall institute any action or proceeding to enforce the
provisions hereof, any party against whom such action or proceeding is brought
hereby waives any claim or defense therein that the plaintiff party has an
adequate remedy at law.
(g) Definitions. For purposes hereof, the following terms shall have
the meaning set forth below:
"Person" means any individual, corporation, partnership,
limited liability company, firm, joint venture, association, joint stock
company, trust, unincorporated organization, governmental body or other entity.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Stock" means, with respect to each Stockholder, all shares,
whether now owned or hereafter acquired, of Common Stock owned by such
Stockholder.
(h) Term. This entire Section 8 shall terminate upon the closing of
a bona fide initial public offering of Common Stock of the Company.
SECTION 9. Nontransferability. No option granted to the grantee under the
Plan or this Stock Option Agreement shall be assignable or transferable by the
grantee (whether by operation of law or otherwise and whether voluntarily or
involuntarily), other than by will or by the laws of descent and distribution.
During the lifetime of the grantee, all rights granted to the grantee under the
Plan or under this Stock Option Agreement shall be exercisable only by the
grantee or the grantee's court appointed legal representative. Notwithstanding
the foregoing, with the Committee's consent, the option may be transferred to
one or more members of the grantee's immediate family or trusts all of the
beneficiaries (other than contingent beneficiaries) of which are members of the
grantee's immediate family.
SECTION 10. Forfeiture for Non-Compete Violation.
(a) Non-Compete. The grantee agrees that during the term of
grantee's employment and for a period of two years thereafter (the "Coverage
Period"), the grantee will not engage in, consult with, participate in, hold a
position as shareholder, director, officer, consultant, employee, partner or
investor, or otherwise assist any business entity (i) in any State of the United
States of America or (ii) in any other country in which the Company has business
activities, in either case, that is engaged in any activities which are
competitive with the business of providing healthcare or other personnel on a
temporary basis to hospitals, healthcare facilities or other entities and any
and all business activities reasonably related thereto in which the Company or
any of its divisions, affiliates or subsidiaries are then engaged.
(b) Non-Solicit. The grantee agrees that during the Coverage Period,
he shall not solicit, attempt to solicit or endeavor to entice away from the
Company any
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person who, at any time during the Term was a traveling nurse or other
healthcare professional, employee, customer, client or supplier of the Company.
(c) Confidential and Proprietary Information. The grantee agrees
that he will not, at any time make use of or divulge to any other person, firm
or corporation any confidential or proprietary information concerning the
business or policies of the Company or any of its divisions, affiliates or
subsidiaries. For purposes of this Agreement, any confidential information shall
constitute any information designated as confidential or proprietary by the
Company or otherwise known by the grantee to be confidential or proprietary
information including, without limitation, customer information. Grantee
acknowledges and agrees that for purposes of this Agreement, "customer
information" includes without limitation, customer lists, all lists of
professional personnel, names, addresses, phone numbers, contact persons,
preferences, pricing arrangements, requirements and practices. Grantee's
obligation under this Section 10(c) shall not apply to any information which (i)
is known publicly; (ii) is in the public domain or hereafter enters the public
domain without the fault of grantee; or (iii) is hereafter disclosed to grantee
by a third party not under an obligation of confidence to the Company. Grantee
agrees not to remove from the premises of the Company, except as an employee of
the Company in pursuit of the business of the Company or except as specifically
permitted in writing by the Company, any document or other object containing or
reflecting any such confidential or proprietary information. Grantee recognizes
that all such information, whether developed by the grantee or by someone else,
will be the sole exclusive property of the Company. Upon termination of
employment, grantee shall forthwith deliver to the Company all such confidential
or proprietary information, including without limitation all lists of customers,
pricing methods, financial structures, correspondence, accounts, records and any
other documents, computer disks, computer programs, software, laptops, modems or
property made or held by him or under his control in relation to the business or
affairs of the Company or any of its divisions, subsidiaries or affiliates, and
no copy of any such confidential or proprietary information shall be retained by
him.
(d) Forfeiture for Violations. If the grantee shall at any time
violate the provisions of Section 10(a), (b), or (c), the grantee shall
immediately forfeit all options (whether vested or unvested) and any exercise of
an option which occurs after (or within 6 months before) any such violation
shall be void ab initio.
SECTION 11. Execution of Agreement. Notwithstanding anything contained in
this Stock Option Agreement to the contrary, no option may be exercised until
the grantee has returned an executed copy of this Stock Option Agreement to the
Company.
SECTION 12. Notices. Any notice to be given to the Company hereunder shall
be in writing and shall be addressed to 00000 Xx Xxxxxx Xxxx, Xxxxx 000, Xxx
Xxxxx, Xxxxxxxxxx 00000, or at such other address as the Company may hereafter
designate to the grantee by notice as provided herein. Any notice to be given to
the grantee hereunder shall be addressed to the grantee at the address set forth
below or at such other address as the grantee may hereafter designate to the
Company by notice as provided herein.
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Notices hereunder shall be deemed to have been duly given when received by
personal delivery or by registered or certified mail to the party entitled to
receive the same.
SECTION 13. Reorganization Event. The option awarded hereunder may be
subject, in the Committee's discretion, to termination on account of a
Reorganization Event affecting the Company, as described in Section 17 of the
Plan.
SECTION 14. Successors and Assigns. This Stock Option Agreement shall be
binding upon and inure to the benefit of the parties hereto and the successors
and assigns of the Company and, to the extent set forth in the Plan, the heirs
and personal representatives of the grantee.
SECTION 15. Governing Law. This Agreement shall be governed by the laws of
the State of Delaware applicable to agreements made and to be performed entirely
within such State.
SECTION 16. Modifications to Agreement. This Agreement may not be altered,
modified, changed or discharged, except by a writing signed by or on behalf of
both the Company and the grantee.
IN WITNESS WHEREOF, the parties hereto have executed this Stock
Option Agreement as of the date and year first above written.
AMN HOLDINGS, INC.
By: /S/ Xxxxxx X. Xxxxxxx
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Title:
/S/ Xxxxx X. Xxxxxxxxxx
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Grantee
X.X. Xxx 0000
Xxxxx Xxxxx Xx, XX 00000
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(Address)
