EXHIBIT 10.6
URS CORPORATION
1999 EQUITY INCENTIVE PLAN
NONSTATUTORY STOCK OPTION AGREEMENT
Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, URS Corporation (the "Company") has granted you an option
under its 1999 Equity Incentive Plan (the "Plan") to purchase the number of
shares of the Company's Common Stock indicated in your Grant Notice at the
exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.
The details of your option are as follows:
1. VESTING. Subject to the limitations contained herein, your option shall
vest as provided in the Grant Notice. Notwithstanding the foregoing, the vesting
of your option shall be accelerated both (i) in the circumstances provided in
Section 12(c) of the Plan and (ii) as provided in Sections 2 and 3 below.
2. TERMINATION OF CONTINUOUS SERVICE.
(a) In the event your Continuous Service terminates due to your
death, the option automatically shall become vested in its entirety as of the
date of your death and your rights under the option shall pass by will or the
laws of descent and distribution; provided, however, that you may designate a
beneficiary to exercise your option as set forth in Section 10 hereof.
(b) In the event your Continuous Service terminates due to your
Disability (as that term is defined in the employment agreement you entered into
with the Company on September 8, 2000, as amended from time to time (the
"Employment Agreement")), the option automatically shall become vested in its
entirety as of the date of your termination of Continuous Service.
(c) In the event you terminate your Continuous Service for Good
Reason (as that term is defined in your Employment Agreement) within one (1)
month of the occurrence of the event constituting Good Reason, or your
Continuous Service is terminated by the Company for any reason other than Cause
(as that term is defined in your Employment Agreement), you shall be credited
with one (1) additional year of vesting under your option.
(d) In the event you terminate your Continuous Service without Good
Reason or your Continuous Service is terminated by the Company for Cause, you
shall be credited only with the vesting that has accrued under your option as of
the date of your termination of Continuous Service.
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(e) To the extent your option is not fully vested on the date of
your termination of Continuous Service pursuant to Sections 2(a) - (d) above, it
shall automatically lapse on such date.
3. CHANGE IN CONTROL. Notwithstanding Section 2 above, your option shall
become vested in its entirety in the event that a Change in Control (as defined
below) occurs with respect to the Company prior to your termination of
Continuous Service; provided that, notwithstanding any definition in your
Employment Agreement to the contrary, "Change in Control" for the purpose of the
vesting of this option shall mean the occurrence of any of the following events
after the Date of Grant:
(a) A change in control required to be reported pursuant to Item
6(e) of Schedule 14A of Regulation 14A under the Securities Exchange Act of
1934, as amended (the "Exchange Act");
(b) A change in the composition of the Company's Board of Directors,
as a result of which fewer than two-thirds (2/3) of the incumbent directors are
directors who either (i) had been directors of the Company twenty-four (24)
months prior to such change or (ii) were elected, or nominated for election, to
the Board of Directors with the affirmative votes of at least a majority of the
directors who had been directors of the Company twenty-four (24) months prior to
such change and who were still in office at the time of the election or
nomination; or
(c) Any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act) through the acquisition or aggregation of securities is or
becomes the beneficial owner, directly or indirectly, of securities of the
Company representing twenty percent (20%) or more of the combined voting power
of the Company's then outstanding securities ordinarily (and apart from rights
accruing under special circumstances) having the right to vote at elections of
directors (the "Base Capital Stock"); except that:
(i) The beneficial ownership by a person of twenty percent
(20%) or more, but less than a majority, of the Base Capital Stock shall not
constitute a Change in Control if such beneficial ownership was acquired in the
ordinary course of such person's business and not with the purpose or effect of
changing or influencing the control of the Company and if such person is
eligible to file a short-form statement on Schedule 13G under Rule 13d-1 under
the Exchange Act with respect to such beneficial ownership; and
(ii) The beneficial ownership by Xxxx Capital Partners, L.P.
and any person "affiliated" (within the meaning of the Exchange Act) with Xxxx
Capital Partners, L.P. (collectively, "Blum") of the Base Capital Stock shall
not constitute a Change in Control unless and until Blum, either alone or as a
member of a group that constitutes a "person" (as defined above), beneficially
owns an aggregate of over twenty-five percent (25%) of the Base Capital Stock.
The definitions of "Change in Control" contained in the Plan and in your
Employment Agreement shall have no application to this Stock Option Agreement.
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4. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common
Stock subject to your option and your exercise price per share referenced in
your Grant Notice may be adjusted from time to time for Capitalization
Adjustments, as provided in the Plan.
5. METHOD OF PAYMENT. Payment of the exercise price is due in full upon
exercise of all or any part of your option as follows:
(a) You may elect to make payment of the exercise price in any
manner PERMITTED BY YOUR GRANT NOTICE, which may include one or more of the
following:
(i) In cash or by check;
(ii) In the Company's sole discretion at the time your option
is exercised, and provided that at the time of exercise the Common Stock is
publicly traded and quoted regularly in The Wall Street Journal, pursuant to a
same day sale program developed under Regulation T as promulgated by the Federal
Reserve Board that, prior to the issuance of Common Stock, results in either the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales
proceeds; or
(iii) Provided that at the time of exercise the Common Stock
is publicly traded and quoted regularly in The Wall Street Journal, by delivery
of already-owned shares of Common Stock either that you have held for the period
required to avoid a charge to the Company's reported earnings (generally six
months) or that you did not acquire, directly or indirectly from the Company,
that are owned free and clear of any liens, claims, encumbrances or security
interests, and that are valued at Fair Market Value on the date of exercise.
"Delivery" for these purposes, in the sole discretion of the Company at the time
you exercise your option, shall include delivery to the Company of your
attestation of ownership of such shares of Common Stock in a form approved by
the Company. Notwithstanding the foregoing, you may not exercise your option by
tender to the Company of Common Stock to the extent such tender would violate
the provisions of any law, regulation or agreement restricting the redemption of
the Company's stock.
(b) If and when expressly authorized by the Compensation Committee
of the Board of Directors and PERMITTED BY YOUR GRANT NOTICE, you may "net
exercise" your option in such manner as the Compensation Committee may
authorize, whereby the Company will deliver to you upon such exercise, subject
to withholding pursuant to Section 10 below, that number of shares equal to the
quotient of (i) the excess of the aggregate Fair Market Value of the number of
shares of Common Stock as to which your option is being exercised over the
aggregate exercise price of your option as to such number of shares, divided by
(ii) the Fair Market Value.
6. MINIMUM EXERCISE. You may not exercise your option for less than one
hundred (100) shares of Common Stock at any one time, except that it may be
exercised for all of the Common Stock remaining subject to the option if fewer
than one hundred (100) shares remain. You may exercise your option only for
whole shares of Common Stock.
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7. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option must also comply
with other applicable laws and regulations governing your option, and you may
not exercise your option if the Company determines that such exercise would not
be in material compliance with such laws and regulations.
8. TERM. You may not exercise your option before the commencement of its
term or after its term expires. Subject to Section 12(c) of the Plan and the
provisions of your Employment Agreement, the term of your option commences on
the Date of Grant and expires upon the EARLIEST of the following:
(a) three (3) months after the termination of your Continuous
Service for any reason other than your retirement from the Company on or after
the date you attain age 65, Disability or death, provided that if during any
part of such three- (3-) month period you may not exercise your option solely
because of the condition set forth in the preceding paragraph relating to
"Securities Law Compliance," your option shall not expire until the earlier of
the Expiration Date or until it shall have been exercisable for an aggregate
period of three (3) months after the termination of your Continuous Service;
(b) three (3) years after your retirement from the Company, if such
retirement occurs on or after the date you attain age 65;
(c) twelve (12) months after the termination of your Continuous
Service due to your Disability;
(d) twelve (12) months after your death if you die either during
your Continuous Service or within three (3) months after your Continuous Service
terminates for any reason other than your retirement from the Company on or
after the date you attain age 65;
(e) the Expiration Date indicated in your Grant Notice; or
(f) the day before the tenth (10th) anniversary of the Date of
Xxxxx.
9. EXERCISE.
(a) You may exercise the vested portion of your option during its
term by delivering a Notice of Exercise (in a form designated by the Company)
together with the exercise price to the Secretary of the Company, or to such
other person as the Company may designate, during regular business hours,
together with such additional documents as the Company may then require.
(b) By exercising your option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the
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payment by you to the Company of any tax withholding obligation of the Company
arising by reason of (1) the exercise of your option or (2) the disposition of
shares of Common Stock acquired upon such exercise.
10. TRANSFERABILITY. Your option is not transferable, except by will or by
the laws of descent and distribution, and is exercisable during your life only
by you. Notwithstanding the foregoing, by delivering written notice to the
Company, in a form satisfactory to the Company, you may designate a third party
who, in the event of your death, shall thereafter be entitled to exercise your
option.
11. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or
service contract, and nothing in your option shall be deemed to (i) alter the
terms of your Employment Agreement or (ii) create in any way whatsoever any
obligation on your part to continue in the employ of the Company or an
Affiliate, or of the Company or an Affiliate to continue your employment. In
addition, nothing in your option shall obligate the Company or an Affiliate,
their respective shareholders, Boards of Directors, Officers or Employees to
continue any relationship that you might have as a Director or Consultant for
the Company or an Affiliate.
12. WITHHOLDING OBLIGATIONS.
(a) At the time you exercise your option, in whole or in part, or at
any time thereafter as requested by the Company, you hereby authorize
withholding from payroll and any other amounts payable to you, and otherwise
agree to make adequate provision for (including by means of a "cashless
exercise" pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board to the extent permitted by the Company), any sums
required to satisfy the federal, state, local and foreign tax withholding
obligations of the Company or an affiliate, if any, which arise in connection
with your option.
(b) Upon your request and subject to approval by the Company, in its
sole discretion, and compliance with any applicable conditions or restrictions
of law, the Company may withhold from fully vested shares of Common Stock
otherwise issuable to you upon the exercise of your option a number of whole
shares of Common Stock having a Fair Market Value, determined by the Company as
of the date of exercise, that satisfies federal, state, local and foreign tax
obligations of the Company and you; provided that the Company shall not withhold
shares of Common Stock at rates in excess of the minimum statutory withholding
rates imposed upon the Company for federal and state tax purposes if such
withholding would result in a charge to the Company's earnings for accounting
purposes. Any adverse consequences to you arising in connection with such share
withholding procedure shall be your sole responsibility.
(c) You may not exercise your option unless the tax withholding
obligations of the Company and/or any Affiliate are satisfied. Accordingly, you
may not be able to exercise your option when desired even though your option is
vested, and the Company shall have no obligation to issue a certificate for such
shares of Common Stock or release such shares of Common Stock from any escrow
provided for herein.
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13. NOTICES. Any notices provided for in your option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the
case of notices delivered by mail by the Company to you, five (5) days after
deposit in the United States mail, postage prepaid, addressed to you at the last
address you provided to the Company.
14. GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option, and
is further subject to all interpretations, amendments, rules and regulations
which may from time to time be promulgated and adopted pursuant to the Plan. In
the event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.
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