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Exhibit 10.39
RURAL/METRO CORPORATION
NON-QUALIFIED STOCK OPTION AGREEMENT
FOR
{{Name_of_Optionee}}
AGREEMENT
1. Grant of Option. Rural/Metro Corporation, a Delaware corporation
(the "Company") hereby grants, as of {{Grant_Date}}, to {{Name_of_Optionee}}
(the "Optionee") an option (the "Option") to purchase up to {{Number_of_Shares}}
shares of the Company's Common Stock, $.01 par value per share (the "Shares"),
at an exercise price per share equal to {{Exercise_Price}}. The Option shall be
subject to the terms and conditions set forth herein. The Option was issued
pursuant to the Company's 2000 Non-Qualified Stock Option Plan (the "Plan"),
which is incorporated herein for all purposes. The Option is a nonqualified
stock option, and not an Incentive Stock Option. The Optionee hereby
acknowledges receipt of a copy of the Plan and agrees to be bound by all of the
terms and conditions hereof and thereof and all applicable laws and regulations.
2. Definitions. Unless otherwise provided herein, terms used herein
that are defined in the Plan and not defined herein shall have the meanings
attributed thereto in the Plan.
3. Exercise Schedule. Except as otherwise provided in Sections 6 or 9
of this Agreement, or in the Plan, the Option is exercisable in installments as
provided below, which shall be cumulative. To the extent that the Option has
become exercisable with respect to a percentage of Shares as provided below, the
Option may thereafter be exercised by the Optionee, in whole or in part, at any
time or from time to time prior to the expiration of the Option as provided
herein. The following table indicates each date (the "Vesting Date") upon which
the Optionee shall be entitled to exercise the Option with respect to the
percentage of Shares granted as indicated beside the date, provided that the
Optionee has been continuously employed by the Company or a Subsidiary through
and on the applicable Vesting Date:
Percentage of Shares Vesting Date
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{{Percentage_of_Shares_Vesting_after_One_Y}} {{One_Year_Vesting_Date}}
{{Percentage_of_Shares_Vesting_after_Two_Y}} {{Two_Year_Vesting_Date}}
{{Percentage_of_Shares_Vesting_after_Three}} {{Three_Year_Vesting_Date}}
Except as otherwise specifically provided herein, there shall be no
proportionate or partial vesting in the periods prior to each Vesting Date, and
all vesting shall occur only on the appropriate Vesting Date. Upon an Optionee's
termination of employment with the Company and its Subsidiaries, any unvested
portion of the Option shall terminate and be null and void.
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4. Method of Exercise. The vested portion of this Option shall be
exercisable in whole or in part in accordance with the exercise schedule set
forth in Section 3 hereof by written notice which shall state the election to
exercise the Option, the number of Shares in respect of which the Option is
being exercised, and such other representations and agreements as to the
holder's investment intent with respect to such Shares as may be required by the
Company pursuant to the provisions of the Plan. Such written notice shall be
signed by the Optionee and shall be delivered in person or by certified mail to
the Secretary of the Company. The written notice shall be accompanied by payment
of the exercise price. This Option shall be deemed to be exercised after both
(a) receipt by the Company of such written notice accompanied by the exercise
price and (b) arrangements that are satisfactory to the Committee in its sole
discretion have been made for Optionee's payment to the Company of the amount
that is necessary to be withheld in accordance with applicable Federal or state
withholding requirements. No Shares will be issued pursuant to the Option unless
and until such issuance and such exercise shall comply with all relevant
provisions of applicable law, including the requirements of any stock exchange
upon which the Shares then may be traded.
5. Method of Payment. Payment of the exercise price shall be by any of
the following, or a combination thereof, at the election of the Optionee: (a)
cash; (b) check; or (c) with Shares that have been held by the Optionee for at
least 6 months (or such other Shares as the Company determines will not cause
the Company to recognize for financial accounting purposes a charge for
compensation expense), or (d) such other consideration or in such other manner
as may be determined by the Board or the Committee in its absolute discretion.
6. Termination of Option.
(a) Any unexercised portion of the Option shall automatically
and without notice terminate and become null and void at the time of the
earliest to occur of:
(i) unless the Committee or the Board otherwise
determines in writing in its sole discretion, three months after the date on
which the Optionee's employment with the Company and its Subsidiaries is
terminated for any reason other than by reason of (A) Cause, which, solely for
purposes of this Agreement, shall mean the termination of the Optionee's
employment by reason of the Optionee's willful misconduct or gross negligence,
(B) a mental or physical disability (within the meaning of Section 22(e) of the
Internal Revenue Code) of the Optionee as determined by a medical doctor
satisfactory to the Committee or the Board, or (C) death;
(ii) immediately upon the termination of the
Optionee's employment with the Company and its Subsidiaries for Cause;
(iii) twelve months after the date on which the
Optionee's employment with the Company and its Subsidiaries is terminated by
reason of a mental or physical disability (within the meaning of Section 22(e)
of the Internal Revenue Code) as determined by a medical doctor satisfactory to
the Committee or the Board;
(iv) twelve months after the date of termination of
the Optionee's employment with the Company and its Subsidiaries by reason of the
death of the Optionee (or
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three months after the date on which the Optionee shall die if such death shall
occur during the one year period specified in paragraph (iii) of this Section
6); or
(v) the tenth anniversary of the date as of which the
Option is granted.
All references herein to the termination of the Optionee's employment shall, in
the case of an Optionee who is not an employee of the Company or a Subsidiary,
refer to the termination of the Optionee's service with the Company.
(b) To the extent not previously exercised, (i) the Option
shall terminate immediately in the event of (1) the liquidation or dissolution
of the Company, or (2) any reorganization, merger, consolidation or other form
of corporate transaction in which the Company does not survive, unless the
successor corporation, or a parent or subsidiary of such successor corporation,
assumes the Option or substitutes an equivalent option or right pursuant to
Section 10(c) of the Plan. The Committee or the Board shall give written notice
of any proposed transaction referred to in this Section 6(b) a reasonable period
of time prior to the closing date for such transaction (which notice may be
given either before or after approval of such transaction), in order that
Optionee may have a reasonable period of time prior to the closing date of such
transaction within which to exercise the Option if and to the extent that it
then is exercisable. The Optionee may condition his exercise of the Option upon
the consummation of a transaction referred to in this Section 6(b).
7. Transferability. The Option granted hereby is not transferable
otherwise than by will or under the applicable laws of descent and distribution,
and during the lifetime of the Optionee the Option shall be exercisable only by
the Optionee, or the Optionee's guardian or legal representative. In addition,
the Option shall not be assigned, negotiated, pledged or hypothecated in any way
(whether by operation of law or otherwise), and the Option shall not be subject
to execution, attachment or similar process. Upon any attempt to transfer,
assign, negotiate, pledge or hypothecate the Option, or in the event of any levy
upon the Option by reason of any execution, attachment or similar process
contrary to the provisions hereof, the Option shall immediately become null and
void.
8. No Rights of Stockholders. Neither the Optionee nor any personal
representative (or beneficiary) shall be, or shall have any of the rights and
privileges of, a stockholder of the Company with respect to any shares of Stock
purchasable or issuable upon the exercise of the Option, in whole or in part,
prior to the date of exercise of the Option.
9. No Right to Continued Employment. Neither the Option nor this
Agreement shall confer upon the Optionee any right to continued employment or
service with the Company.
10. Law Governing. This Agreement shall be governed in accordance with
and governed by the internal laws of the State of Arizona.
11. Interpretation/Provisions of Plan Control. This Agreement is
subject to all the terms, conditions and provisions of the Plan, including,
without limitation, the amendment provisions thereof, and to such rules,
regulations and interpretations relating to the Plan adopted by the Committee or
the Board as may be in effect from time to time. If and to the extent that this
Agreement conflicts or is inconsistent with the terms, conditions and provisions
of the Plan, the
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Plan shall control, and this Agreement shall be deemed to be modified
accordingly. The Optionee accepts the Option subject to all the terms and
provisions of the Plan and this Agreement. The undersigned Optionee hereby
accepts as binding, conclusive and final all decisions or interpretations of the
Committee or the Board upon any questions arising under the Plan and this
Agreement.
12. Notices. Any notice under this Agreement shall be in writing and
shall be deemed to have been duly given when delivered personally or when
deposited in the United States mail, registered, postage prepaid, and addressed,
in the case of the Company, to the Company's Secretary at 0000 Xxxxxx Xxxxxx
Xxxx, Xxxxxxxxxx, Xxxxxxx 00000, or if the Company should move its principal
office, to such principal office, and, in the case of the Optionee, to the
Optionee's last permanent address as shown on the Company's records, subject to
the right of either party to designate some other address at any time hereafter
in a notice satisfying the requirements of this Section.
13. Tax Consequences. Set forth below is a brief summary as of the date
of this Option of some of the federal tax consequences of exercise of this
Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE,
AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. OPTIONEE SHOULD CONSULT
A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
(a) Exercise of Option. There may be a regular federal income
tax liability upon the exercise of the Option. The Optionee will be treated as
having received compensation income (taxable at ordinary income tax rates) equal
to the excess, if any, of the fair market value of the Shares on the date of
exercise over the exercise price. If Optionee is an employee, the Company will
be required to withhold from Optionee's compensation or collect from Optionee
and pay to the applicable taxing authorities an amount equal to a percentage of
this compensation income at the time of exercise.
(b) Disposition of Shares. If Shares are held for at least one
year, any gain realized on disposition of the Shares will be treated as
long-term capital gain for federal income tax purposes.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day first written above.
COMPANY:
RURAL/METRO CORPORATION
By:
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{{Officer_Signing_on_Behalf_of_Rural_Metro}}
Senior Vice President and General Counsel.
Optionee acknowledges receipt of a copy of the Plan and represents that
he or she is familiar with the terms and provisions thereof, and hereby accepts
this Option subject to all of the terms and provisions thereof. Optionee has
reviewed the Plan and this Option in their entirety, has had an opportunity to
obtain the advice of counsel prior to executing this Option, and fully
understands all provisions of the Option.
Dated: OPTIONEE:
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By:
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{{Name_of_Optionee}}
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