Exhibit 10.21
Non-Qualified Stock Option Agreement
under the Boron, XxXxxx & Associates, Inc.
1996 Stock Option and Grant Plan
Name of Optionee: Xxxxxxx X. XxXxxxxx
No./Class of Option Shares: 100,000 Shares of Class A Common Stock
Grant Date: June 30, 1997
Expiration Date: June 30, 2007
Option Exercise Price/Share: $6.30
Pursuant to the Boron, XxXxxx & Associates, Inc. 1996 Stock Option and
Grant Plan (the "Plan"), Boron, XxXxxx & Associates, Inc., a Delaware
corporation (the "Company"), hereby grants to the person named above (the
"Optionee"), who is an officer or full-time employee of the Company or any of
its subsidiaries, an option (the "Stock Option") to purchase on or prior to the
expiration date specified above (the "Expiration Date") all or any part of the
number of shares of Class A Common Stock, par value $0.01 per share ("Common
Stock"), of the Company indicated above (the "Option Shares"), at the per share
option exercise price specified above, subject to the terms and conditions set
forth in this Incentive Stock Option Agreement (the "Agreement") and in the
Plan. This Stock Option is not intended to qualify as an "incentive stock
option" as defined in Section 422(b) of the Internal Revenue Code of 1986, as
amended from time to time (the "Code"). All capitalized terms used herein and
not otherwise defined shall have the respective meanings set forth in the Plan.
1. Vesting and Exercisability.
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(a) No portion of this Stock Option may be exercised until such portion
shall have vested.
(b) Except as set forth below and in Section 6, and subject to the
determination of the Compensation Committee of the Board of Directors of the
Company or the Board of Directors of the Company, as applicable (the
"Committee"), in its sole discretion to accelerate the vesting schedule
hereunder, this Stock Option shall be vested and exercisable as provided in
Schedule A hereto.
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(c) In the event that the Optionee's Service Relationship (as
hereinafter defined) with the Company and its subsidiaries terminates for any
reason or under any circumstances, including the Optionee's resignation,
retirement or termination by the Company, upon the Optionee's death or
disability, or for any other reason, regardless of the circumstances thereof, or
in the event that as of October 1, 1997, the Optionee has failed to permanently
relocate to the greater New York Metropolitan area, this Stock Option shall no
longer vest or become exercisable with respect to any Option Shares not vested
as of the date of such termination from and after the date of such termination,
except as provided in Section 1(d) and Section 5 of Schedule A hereto, and this
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Stock Option may thereafter be exercised, to the extent it was vested and
exercisable on such date of such termination or as of October 1, 1997, if
applicable, until the Expiration Date contemplated by Section 1(d). Except as
the Committee may otherwise determine, after either such event this Stock Option
shall be null and void as to any Option Shares not then vested. For purposes
hereof, a "Service Relationship" shall mean any relationship as an employee,
part-time employee or consultant of the Company
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or any subsidiary of the Company such that, for example, a Service Relationship
shall be deemed to continue without interruption in the event the Optionee's
status changes from full-time employee to part-time employee or consultant.
(d) Once any portion of this Stock Option becomes vested and
exercisable, it shall continue to be exercisable by the Optionee or his
successors as contemplated herein at any time or times prior to the earlier of
(i) the date which is 12 months following the date on which the Optionee's
Service Relationship with the Company and its subsidiaries terminates due to
death or disability or for three months following the date on which the
Optionee's Service Relationship with the Company and its subsidiaries terminates
if the termination is due to any other reason, except as provided in Section 5
of Schedule A, or (ii) June 30, 2007, subject to the provisions hereof,
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including, without limitation, Section 7 hereof which provides for the
termination of unexercised options upon completion of certain transactions as
described therein (the "Expiration Date").
2. Exercise of Stock Option.
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(a) The Optionee may exercise only vested portions of this Stock Option
and only in the following manner: Prior to the Expiration Date (subject to
Section 7 and Schedule A ), the Optionee may deliver a Stock Option Exercise
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Notice (an "Exercise Notice") in the form of Appendix A hereto indicating his
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election to purchase some or all of the Option Shares with respect to which this
Stock Option has vested at the time of such notice. Such notice shall specify
the number of Option Shares to be purchased.
Payment of the purchase price for the Option Shares may be made by one or
more (if applicable) of the following methods: (a) in cash, by certified or
bank check or other
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instrument acceptable to the Option Committee; or (b) if the closing of the
first underwritten public offering pursuant to an effective registration
statement under the Securities Act of 1933, as amended, covering the offer and
sale of Common Stock of the Company to the public has occurred, then (i) in the
form of shares of Common Stock that are not then subject to restrictions under
any Company plan and that have been held by the Optionee for at least six
months, if permitted by the Committee in its discretion; (ii) by the Optionee
delivering to the Company a properly executed Exercise Notice together with
irrevocable instructions to a broker to promptly deliver to the Company cash or
a check payable and acceptable to the Company to pay the option purchase price,
provided that in the event the Optionee chooses to pay the option purchase price
as so provided, the Optionee and the broker shall comply with such procedures
and enter into such agreements of indemnity and other agreements as the Option
Committee shall prescribe as a condition of such payment procedure, or (c) a
combination of (a), (b)(i) and (b)(ii) above. Payment instruments will be
received subject to collection.
(b) Certificates for the Option Shares so purchased will be issued and
delivered to the Optionee upon compliance to the satisfaction of the Option
Committee with all requirements under applicable laws or regulations in
connection with such issuance. Until the Optionee shall have complied with the
requirements hereof and of the Plan, the Company shall be under no obligation to
issue the Option Shares subject to this Stock Option, and the determination of
the Option Committee as to such compliance shall be final and binding on the
Optionee. The Optionee shall not be deemed to be the holder of, or to have any
of the rights of a holder with respect to, any shares of stock subject to this
Stock Option unless and until
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this Stock Option shall have been exercised pursuant to the terms hereof, the
Company shall have issued and delivered the Option Shares to the Optionee, and
the Optionee's name shall have been entered as a stockholder of record on the
books of the Company. Thereupon, the Optionee shall have full dividend and
other ownership rights with respect to such Option Shares, subject to the terms
of this Agreement.
(c) Notwithstanding any other provision hereof or of the Plan, no
portion of this Stock Option shall be exercisable after the Expiration Date,
including such date as is contemplated by Section 7 hereof.
3. Incorporation of Plan. Notwithstanding anything herein to the
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contrary, this Stock Option shall be subject to and governed by all the terms
and conditions of the Plan, provided that in the event of any inconsistency in
the specific terms, this Stock Option shall be given effect.
4. Transferability. This Agreement is personal to the Optionee and is not
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transferable by the Optionee in any manner other than by will or by the laws of
descent and distribution. This Stock Option may be exercised during the
Optionee's lifetime only by the Optionee. The Optionee may elect to designate a
beneficiary by providing written notice of the name of such beneficiary to the
Company, and may revoke or change such designation at any time by filing written
notice of revocation or change with the Company; such beneficiary may exercise
the Optionee's Stock Option in the event of the Optionee's death to the extent
provided herein. If the Optionee does not designate a beneficiary, or if the
designated beneficiary predeceases the Optionee, the personal representative of
the Optionee may exercise this Stock Option to the extent provided herein in the
event of the Optionee's death.
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5. Adjustment Upon Changes in Capitalization. The shares of stock covered
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by this Stock Option are shares of Class A Common Stock of the Company. Subject
to Section 6 hereof, if the shares of Class A Common Stock as a whole are
increased, decreased, changed or converted into or exchanged for a different
number or kind of shares or securities of the Company, whether through merger or
consolidation, reorganization, recapitalization, reclassification, stock
dividend, stock split, combination of shares, exchange of shares, change in
corporate structure or the like, an appropriate and proportionate adjustment
shall be made in the number and kind of shares and in the per share exercise
price of shares subject to any unexercised portion of this Stock Option. In the
event of any such adjustment in this Stock Option, the Optionee thereafter shall
have the right to purchase the number of shares under this Stock Option at the
per share price, as so adjusted, which the Optionee could purchase at the total
purchase price applicable to this Stock Option immediately prior to such
adjustment. Adjustments under this Section 5 shall be determined by the Option
Committee of the Company, whose determination as to what adjustment shall be
made, and the extent thereof, shall be conclusive. No fractional shares of
Common Stock shall be issued under the Plan resulting from any such adjustment,
but the Company in its discretion may make a cash payment in lieu of fractional
shares.
6. Effect of Certain Transactions. In the case of (a) the dissolution or
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liquidation of the Company; (b) the sale of all or substantially all of the
assets of the Company and its Subsidiaries to another person or entity; (c) a
merger, reorganization or consolidation in which the holders of the Company's
outstanding voting power immediately prior to such transaction do not own a
majority of the outstanding voting power of the surviving or resulting
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entity immediately upon completion of such transaction; (d) the sale of the
outstanding stock of the Company to an unrelated person or entity; or (e) any
other transaction or series of transactions effectively constituting a sale of
the Company in which the owners of the Company's outstanding voting power
immediately prior to such transaction do not own a majority of the outstanding
voting power of the surviving or resulting entity immediately upon completion of
such transaction (a "Sale Event"), this Stock Option (i) shall be deemed fully
vested and exercisable (to the extent not previously vested) immediately prior
to the effective date of (or, if relevant, the record date for determining
stockholders entitled to participate in) such transaction to the extent, but
only to the extent, provided in Schedule A hereto, provided that such
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acceleration and any notice of exercise of options that become vested as a
result thereof shall in all cases be subject to and contingent upon the closing
or consummation of such transaction, and (ii) shall no longer vest as to any
Option Shares not then vested or which do not vest as a result of such
transaction except as the Committee otherwise may determine in its sole
discretion. In any case, this Stock Option (with respect to both vested and
unvested Stock Options) shall terminate on the effective date of (or, if
relevant, the record date for determining stockholders entitled to participate
in) such transaction or event; provided, however, that if (and only if) the
Optionee agrees, provision may be made in such transaction in the sole
discretion of the parties thereto for the assumption of this Stock Option or the
substitution for this Stock Option of a new stock option of the successor person
or entity or a parent or subsidiary thereof, with such adjustment as to the
number and kind of shares and the per share exercise price as such parties shall
agree to, and, in the case of an assumption, with references to the Company
being deemed to refer to such successor entity. In the event of any
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transaction which will result in such termination, the Company shall give to the
Optionee written notice thereof at least fifteen (15) days prior to the
effective date of such transaction or the record date on which stockholders of
the Company entitled to participate in such transaction shall be determined,
whichever comes first. Until the earlier to occur of such effective date or
record date, the Optionee may exercise any vested portion of this Stock Option,
but after such effective date or record date, as the case may be, the Optionee
may not exercise this Stock Option unless it is assumed or substituted by the
successor as provided above.
7. Withholding Taxes. The Optionee shall, not later than the date as of
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which the exercise of this Stock Option becomes a taxable event for federal
income tax purposes, pay to the Company or make arrangements satisfactory to the
Committee for payment of any federal, state and local taxes required by law to
be withheld on account of such taxable event. Subject to approval by the
Committee, the Optionee may elect to have such tax withholding obligation
satisfied, in whole or in part, by authorizing the Company to withhold from
shares of Common Stock to be issued or transferring to the Company, a number of
shares of Common Stock with an aggregate Fair Market Value that would satisfy
the withholding amount due. For purposes of this Section 7 "Fair Market Value"
on any given date means the last reported sale price at which Common Stock is
traded on such date or, if no Common Stock is traded on such date, the next
preceding date on which Common Stock was traded, as reflected on the principal
stock exchange or, if applicable, any other national stock exchange on which the
Common Stock is traded or admitted to trading. The Optionee acknowledges and
agrees that the Company or any subsidiary of the Company has the right to deduct
from payments of any kind
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otherwise due to the Optionee, or from the Option Shares to be issued in respect
of an exercise of this Stock Option, any federal, state or local taxes of any
kind required by law to be withheld with respect to the issuance of Option
Shares to the Optionee.
8. Miscellaneous Provisions.
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(a) Equitable Relief. The parties hereto agree and declare that legal
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remedies may be inadequate to enforce the provisions of this Agreement and that
equitable relief, including specific performance and injunctive relief, may be
used to enforce the provisions of this Agreement.
(b) Change and Modifications. This Agreement may not be orally changed,
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modified or terminated, nor shall any oral waiver of any of its terms be
effective. This Agreement may be changed, modified or terminated only by an
agreement in writing signed by the Company and the Optionee.
(c) Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Delaware.
(d) Headings. The headings are intended only for convenience in finding
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the subject matter and do not constitute part of the text of this Agreement and
shall not be considered in the interpretation of this Agreement.
(e) Saving Clause. If any provision(s) of this Agreement shall be
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determined to be illegal or unenforceable, such determination shall in no manner
affect the legality or enforceability of any other provision hereof.
(f) Notices. All notices, requests, consents and other communications
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shall be in writing and be deemed given when delivered personally, by telex or
facsimile
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transmission or when received if mailed by first class registered or certified
mail, postage prepaid. Notices to the Company or the Optionee shall be
addressed as set forth underneath their signatures below, or to such other
address or addresses as may have been furnished by such party in writing to the
other.
(g) Benefit and Binding Effect. This Agreement shall be binding upon
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and shall inure to the benefit of the parties hereto, their respective
successors, permitted assigns, and legal representatives. The Company has the
right to assign this Agreement, and such assignee shall become entitled to all
the rights of the Company hereunder to the extent of such assignment.
(h) Counterparts. For the convenience of the parties and to facilitate
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execution, this Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same document.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned.
BORON, XXXXXX & ASSOCIATES, INC.
By: /s/ Xxxxxxx X. XxXxxx
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Title: President
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Address: BORON, XXXXXX & ASSOCIATES, INC.
Attention: President
00-00 Xxxxx 000 Xxxxx
Xxxx Xxxx, Xxx Xxxxxx 00000
OPTIONEE:
/s/ Xxxxxxx X. XxXxxxxx
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Xxxxxxx X. XxXxxxxx
Optionee's Address:
c/o Boron XxXxxx & Associates, Inc.
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17-17 Xxxxx 000 Xxxxx
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Xxxx Xxxx, Xxx Xxxxxx 00000
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DESIGNATED BENEFICIARY:
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Beneficiary's Address:
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Schedule A
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Vesting Schedule
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This Stock Option vesting schedule shall in all respects be the same
as the vesting schedule attached as Schedule A to the Incentive Stock Option
Agreement between Boron, XxXxxx & Associates, Inc. and Xxxxxxx X. XxXxxxxx dated
June 9, 1997 (the "Prior Agreement"), with the following exceptions:
A. Paragraph 2 shall read "Subject to Section 1(c) of the attached Agreement,
this Stock Option and the Option Shares subject thereto shall vest and become
exercisable to the extent not previously vested on June 30, 2004."
B. The Incremental No. of Shares Vested for achievement of Tranche 1 shall
equal 8,334.
C. The Incremental No. of Shares Vested for achievement of Tranche 2 shall
equal 8,333.
D. The Incremental No. of Shares Vested for achievement of Tranche 3 shall
equal 8,333.
E. The Incremental No. of Shares Vested for achievement of Tranche 4 shall
equal 33,334 and that the number "66,666" contained in the column "Vesting Date"
for Tranche 4 in the Prior Agreement shall be changed to 33,334.
F. The Incremental No. of Shares Vested for achievement of Tranche 5 shall
equal 8,333.
G. The Incremental No. of Shares Vested for achievement of Tranche 6 shall
equal 33,333 and that the number "66,667" contained in the column "Vesting Date"
for Tranche 6 in the Prior Agreement shall be changed to 33,333.
All section references in the attached agreement shall refer to sections of
Schedule A of the Prior Agreement, as amended by this Schedule A.
A-1
Appendix A
STOCK OPTION EXERCISE NOTICE
Boron, XxXxxx & Associates, Inc.
Attention: Chief Financial Officer
00-00 Xxxxx 000 Xxxxx
Xxxx Xxxx, Xxx Xxxxxx 00000
Dear Sirs:
Pursuant to the terms of my stock option agreement dated ____________
(the "Agreement") under the Boron, XxXxxx & Associates, Inc 1996 Stock Option
and Grant Plan, I, [Insert Name] ___________________, hereby [Circle One]
partially/fully exercise such option by including herein payment in the amount
of $_______ representing the purchase price for [Fill in number of Option
Shares] __________ option shares. I have chosen the following form(s) of
payment:
[ ] 1. Cash
[ ] 2. Certified or Bank Check payable to Boron, XxXxxx & Associates, Inc.
[ ] 3. Other (as described in the Agreement (please describe))
______________.
Sincerely yours,
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Please Print Name
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Signature
A-2
