Exhibit 10.67
STOCK OPTION AGREEMENT made as of the 10th day of August, 2001 between
NATIONAL MEDICAL HEALTH CARD SYSTEMS, INC., a New York corporation (the
"Company"), and Xxxx Xxxxxx (the "Optionee").
WHEREAS, the Optionee is an employee of the Company or a subsidiary
thereof;
WHEREAS, the Company desires to provide to the Optionee an additional
incentive to promote the success of the Company;
NOW, THEREFORE, in consideration of the foregoing, the Company hereby
grants to the Optionee (the "Grant") the right and option to purchase Common
Shares of the Company under and pursuant to the terms and conditions of the 1999
Stock Option Plan (the "Plan") and upon and subject to the following terms and
conditions:
1. GRANT OF OPTION. The Company hereby grants to the Optionee the right and
option (the "Option") to purchase up to Two Thousand (2,000) Common Shares of
the Company (the "Option Shares") during the following periods:
(a) All or any part of Six Hundred Seventy (670) Common Shares may be
purchased during the period commencing August 10, 2002 and terminating at 5:00
P.M. on August 10, 2006 (the "Expiration Date").
(b) All or any part of Six Hundred Sixty-Five (665) Common Shares may be
purchased during the period commencing on August 10, 2003 and terminating at
5:00 P.M. on the Expiration Date.
(c) All or any part of Six Hundred Sixty-Five (665) Common Shares may be
purchased during the period commencing on August 10, 2004 and terminating at
5:00 P.M. on the Expiration Date.
2. NATURE OF OPTION. Such Options to purchase the Option Shares are
intended to meet the requirements of Section 422 of the Internal Revenue Code of
1986, as amended, relating to "incentive stock options".
3. EXERCISE PRICE. The exercise price of each of the Option Shares shall be
Five Dollars and no cents ($5.00) (the "Option Price"). The Company shall pay
all original issue or transfer taxes on the exercise of the Option.
4. EXERCISE OF OPTIONS. The Option shall be exercised in accordance with
the provisions of the Plan. As soon as practicable after the receipt of notice
of exercise (in the form annexed hereto as Exhibit A) and payment of the Option
Price by check in an amount at least equal to the par value of the Common
Shares, together with a recourse promissory note in an amount equal to the
balance of the exercise price or as otherwise provided for in the Plan, the
Company shall tender to the Optionee certificates issued in the Optionee's name
evidencing the number of Option Shares indicated in the notice of exercise.
5. CAPITAL ADJUSTMENT.
(a) If the Company is merged or consolidated with or into another
corporation where the Company is not the survivor, there shall be substituted
for the Shares issuable upon exercise of the outstanding Options an appropriate
number of shares of each class of stock, other securities or other assets of the
merged or consolidated corporation which were distributed to the shareholders of
the Company in respect of such Shares; provided, however, that the Option may be
exercised in full by the Optionee as of the effective date of any such merger or
consolidation of the Company without regard to the installment exercise
provisions of Paragraph 1, by the Optionee giving notice in writing to the
Company of his intention to so exercise.
(b) If the Company is liquidated or dissolved then all outstanding portions
of the Option may be exercised in full by the Optionee as of the effective date
of any such liquidation or dissolution of the Company without regard to the
installment exercise provisions of Paragraph 1, by the Optionee giving notice in
writing to the Company of his intention to so exercise.
(c) If the outstanding Shares of Common Stock shall at any time be changed
or exchanged by declaration of a stock dividend, stock split, combination or
exchange of shares, recapitalization, extraordinary dividend payable in stock of
a corporation other than the Company, or otherwise in cash, or any other like
event by or of the Company, and as often as the same shall occur, then the
number, class and kind of Shares subject to this Option and the Option Price for
such Shares shall be appropriately and equitably adjusted so as to maintain the
proportionate number of Shares without changing the aggregate Option Price;
provided, however, no adjustment shall be made by reason of the distribution of
subscription rights on outstanding stock.
6. CHANGE IN CONTROL. In the event of a Change in Control (as hereinafter
defined), any Options granted hereunder which have not vested as of the date of
the Change in Control shall automatically vest on such date. For purposes of
this Agreement, the term "Change in Control" shall mean:
(a) the transfer, through one transaction or a series of related
transactions, either directly or indirectly, or through one or more
intermediaries, of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Securities Exchange Act of 1934) of 50% or more of either
the then outstanding Common Shares or the combined voting power of the Company's
then outstanding voting securities entitled to vote generally in the election of
directors, or the last of any series of transfers that results in the transfer
of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934) of 50% or more of either the then outstanding
Common Shares or the combined voting power of the Company's then outstanding
voting securities entitled to vote generally in the election of directors;
(b) approval by the stockholders of the Company of a merger or
consolidation, with respect to which persons who were the stockholders of the
Company immediately prior to such merger or consolidation do not, immediately
thereafter, own more than 50% of the combined voting power of the merged or
consolidated company's then outstanding voting securities, entitled to vote
generally, in the election of directors or with respect to a liquidation or
dissolution of the Company or the sale of all or substantially all of the assets
of the Company;
(c) the transfer, through one transaction or a series of related
transactions, of more than 50% of the assets of the Company, or the last of any
series of transfers that results in the transfer of more than 50% of the assets
of the Company. For purposes of this paragraph, the determination of what
constitutes more than 50% of the assets of the Company shall be determined based
on the most recent financial statements prepared by the Company's independent
accountants; or (d) during any fiscal year, individuals who at the beginning of
such year constituted the board of directors of the Company (the "Board") and
any new director or directors whose election by the Board was approved by a vote
of a majority of the directors then still in office who either were directors at
the beginning of the year or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof.
7. TRANSFERABILITY. The Option shall not be transferable other than by will
or the laws of descent and distribution and, during the Optionee's lifetime,
shall not be exercisable by any person other than the Optionee.
8. INCORPORATION BY REFERENCE. The terms and conditions of the Plan are
hereby incorporated by reference and made a part hereof.
9. NOTICES. Any notice or other communication given hereunder shall be
deemed sufficient if in writing and hand delivered or sent by registered or
certified mail, return receipt requested, addressed to the Company, 00 Xxxxxx
Xxxx Xxxxx, Xxxx Xxxxxxxxxx, Xxx Xxxx 00000, Attention: Secretary and to the
Optionee at the address indicated below. Notices shall be deemed to have been
given on the date of hand delivery or mailing, except notices of change of
address, which shall be deemed to have been given when received.
10. BINDING EFFECT. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective legal representatives,
successors and assigns.
11. ENTIRE AGREEMENT. This Agreement, together with the Plan, contains the
entire understanding of the parties hereto with respect to the subject matter
hereof and may be modified only by an instrument executed by the party sought to
be charged.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
NATIONAL MEDICAL HEALTH CARD
SYSTEMS, INC.
By:
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Signature of Optionee
Xxxx Xxxxxx
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Name of Optionee
0 Xxxx Xxxx Xxxxx, Xxxxxx Xxxx, XX 00000
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Address of Optionee
EXHIBIT A
NATIONAL MEDICAL HEALTH CARD SYSTEMS, INC.
OPTION EXERCISE FORM
The undersigned hereby irrevocably elects to exercise the Option dated
August 10, 2001, to the extent of purchasing _________ Common Shares of National
Medical Health Card Systems, Inc. The undersigned hereby makes payment or
covenants to make payment for such Common Shares pursuant to Section 13(b) of
the Plan in payment therefor.
Xxxx Xxxxxx
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Name of Optionee
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Signature of Optionee
Address of Holder
Date
