Exhibit 10.9
Form To Be Used For Option Plan
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For Employees
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STOCK OPTION AGREEMENT
THIS AGREEMENT, dated as of , is made by and between
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RoTech Healthcare Inc., a Delaware corporation (the "Company"), and
(the "Optionee").
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WHEREAS, the Optionee has been selected by the Board of Directors of
the Company (the "Board") or a committee thereof (including any compensation
committee created by the Board) to receive a grant of stock options under the
RoTech Healthcare Inc. Common Stock Option Plan (the "Plan").
NOW, THEREFORE, in consideration of the Optionee's employment with the
Company, the Company and the Optionee agree as follows:
1. Definitions.
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Any capitalized term not defined herein shall have the meaning set
forth in the Plan.
2. Grant of Option.
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(a) Grant: Grant Date. Subject to the terms and conditions hereof, the
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Company hereby grants to the Optionee as of (the "Grant Date") an
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option to purchase up to Shares of the Company's common stock at an
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exercise price of $ per Share.
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(b) Adjustments in Option. In the event that the outstanding Shares
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subject to the Option are changed into or exchanged for a different number or
kind of shares or securities of the Company, or of another corporation, by
reason of reorganization merger or other subdivision, consolidation,
recapitalization, reclassification, stock split, issuance of warrants, stock
dividend or combination of shares or similar event, the Board shall make an
appropriate and equitable adjustment in the Option so that the Optionee's
proportionate interest shall be maintained as before the occurrence of such
event, provided that any such adjustment shall be consistent with the provisions
of the Optionee's employment agreement, if applicable.
(c) Form of Option. [Board must determine whether options are to be
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Incentive Stock Options, Nonqualified Stock Options, or a combination thereof,
and this provision must so state.]
(d) Term. The Option shall expire on the tenth anniversary of the
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Grant Date, or such earlier time as provided in Section 2(g) of this Agreement.
[If grant is an Incentive Stock Option to a Ten Percent Shareholder, the Option
shall expire on the fifth anniversary of the Grant Date or such earlier time as
provided in Section 2(g) of this Agreement.]
(e) Vesting. (i) The Option shall become vested and exercisable with
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respect to one-quarter (25%) of the original aggregate number of Shares
purchasable upon exercise of such Option on each of the first four anniversaries
of the Grant Date, so that the Optionee shall be fully vested on the fourth
anniversary of the Grant Date. (ii) In the event of a Change in Control,
Optionee will be deemed to have become vested automatically in one-half (50%) to
one hundred percent (100%) of the Shares, such percentage to be determined in
the sole discretion of the Board. (iii) In the event of consummation of an
Initial Public Offering, one-quarter (25%) of the original aggregate number of
Shares purchasable upon exercise of such Option will be deemed to have vested.
(For purposes of illustration, assuming a Participant were granted at the
beginning of Year 1 an Option to purchase one hundred thousand (100,000) Shares
and at the end of Year 2 the Company were to consummate an Initial Public
Offering, such Option would vest and become exercisable as follows: (x)
twenty-five thousand (25,000) Shares at the end of Year 1, (y) twenty-five
thousand (25,000) Shares at the end of Year 2 (each as provided in clause (i)
above) and (z) an additional twenty-five thousand (25,000) Shares in Year 2 (as
provided in clause (iii) above). The remaining twenty-five thousand (25,000)
Shares would vest and become exercisable at the end of Year 3 (as provided in
clause (i) above).)
(f) Exercise. The Optionee may exercise an Option in whole or in part
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at any time by delivering written notice of such exercise to the Secretary of
the Company specifying the number of Shares as to which the Option is being
exercised, and enclosing payment for the aggregate exercise price of the Shares
with respect to which the Option is being exercised. Such payment shall be made
(i) in cash or by check, (ii) if approved by the Board, by the delivery of
Shares previously owned by the Optionee for at least six (6) months prior to
such exercise, duly endorsed for transfer to the Company, with a Fair Market
Value on the date of delivery equal to the aggregate exercise price of the
Shares with respect to which the Option is being exercised, (iii) by directing
the Company to subtract from the number of Shares underlying the Option, that
number of Shares having a Fair Market Value equal to the exercise price (or
portion thereof) required to be paid, or (iv) solely at a time when the Shares
are publicly-traded, pursuant to a "cashless exercise" of the Option pursuant to
the establishment of procedures whereby the Participant, by a properly executed
written notice, directs (A) an immediate market sale or margin loan respecting
all or a part of the Shares to which he is entitled upon exercise pursuant to an
extension of credit by the Company to the Participant, (B) the delivery of the
Shares from the Company directly to a brokerage firm and (C) the delivery of the
exercise price from sale or margin loan proceeds from the brokerage firm
directly to the Company, or (v) any combination of the foregoing approved by the
Board, in its sole discretion. Partial exercise shall be for whole Shares only
and shall not be for less than one hundred (100) Shares unless the number of
Shares purchased constitutes the total number of Shares then remaining subject
to the Option or the Board permits such smaller exercise in its sole discretion.
(g) Exercise Following Termination of Employment. In the event the
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Optionee's termination of employment is for Cause, the Option, whether
exercisable or nonexercisable, at such time, shall be deemed to have terminated
as of the day preceding such termination of employment. If such termination of
employment is for any reason other than Cause, any outstanding portion of the
Option that has not become exercisable shall terminate on the date of such
termination of employment, unless provided otherwise by the Board, in its sole
discretion. Any outstanding exercisable portion of an Option shall be
exercisable for the following periods:
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(A) If the Optionee's termination of employment is due to death,
retirement on or after age 65, or Disability, such exercisable portion of such
Option shall remain exercisable for its term, and shall thereafter terminate and
be of no further force or effect. Any Options that are not exercisable at such
time shall be of no further force or effect.
(B) In all other cases, the Option shall be exercisable for
[ ] days following such termination of employment.
(h) Nontransferability. The Option shall not be transferable other
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than by will or the laws of descent and distribution, and no transfer so
effected shall be effective to bind the Company unless the Company has been
furnished with written notice thereof and a copy of the will and/or such other
evidence as the Board may deem necessary to establish the validity of the
transfer and the acceptance by the transferee or transferees of the terms and
conditions of the Option; provided, however, that, in the discretion of the
Board, Options may be transferred pursuant to a Qualified Domestic Relations
Order (within the meaning of the Code). [In addition, an Optionee may transfer
Options that are not Incentive Stock Options to his or her Immediate Family
Members.]
(i) Conditions to Issuance of Stock Certificates.
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(1) The Shares deliverable upon the exercise of the Option, or
any portion thereof, may be either previously authorized but unissued Shares or
issued Shares which have been reacquired by the Company. Such Shares shall be
fully paid and non-assessable. The stock certificates evidencing the Shares
shall bear such legends restricting transferability as the Board deems necessary
or advisable.
(2) The Company shall not be required to issue or deliver any
certificate or certificates for Shares deliverable upon any exercise of the
Option prior to fulfillment of all of the following conditions:
(A) The completion of any registration or other qualification of
such Shares under any state or federal law or under rulings or regulations of
the Securities and Exchange Commission or of any other governmental regulatory
body, or the obtaining of approval or other clearance from any state or federal
governmental agency which the Board shall, in its sole discretion, deem
necessary or advisable.
(B) If, in its sole discretion, the Board deems it necessary or
advisable, the execution by the Optionee of a written representation and
agreement, in a form satisfactory to the Board, in which the Optionee represents
that the Shares acquired by the Optionee upon exercise are being acquired for
investment and not with a view toward distribution thereof.
(j) Rights as Stockholder. The Optionee shall not be, nor have any of
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the rights or privileges of, a stockholder of the Company in respect of any
Shares purchasable upon the exercise of the Option unless and until certificates
representing such Shares have been issued by the Company.
3. Miscellaneous.
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(a) Administration. The Board shall have the power to interpret the
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Plan and this Agreement, and to adopt such rules for the administration,
interpretation and application of the Plan as are consistent therewith and to
interpret or revoke any such rules. All actions taken and all interpretations
and determinations made by the Board shall be final and binding upon the
Optionee, the Company, and all other interested persons.
(b) Withholding of Taxes. No later than the date as of which an amount
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first becomes includible in the gross income of the Optionee for federal income
tax purposes with respect to an Option granted under this Agreement, the
Optionee shall pay to the Company, or the Optionee (or his designated
beneficiary) shall make arrangements satisfactory to the Company regarding the
payment of, any federal, estate, or local taxes of any kind required by law or
the Company to be withheld with respect to such amount. The obligations of the
Company under this Agreement shall be conditioned on such payment or
arrangements, and the Company shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to the
Optionee.
(c) No Right to Continued Employment. Nothing in this Agreement or in
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the Plan shall confer upon the Optionee any right to continue in the employ of
the Company or shall interfere with or restrict in any way the rights of the
Company, which are hereby expressly reserved, to discharge the Optionee at any
time for any reason whatsoever, with or without Cause.
(d) Entire Agreement; Amendment. This Agreement, and the Plan,
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constitute the entire agreement between the parties with respect to the subject
matter hereof, and supersede all prior agreements and understandings between the
parties with respect to such subject matter. Any term or provision of this
Agreement may be waived at any time by the party which is entitled to the
benefits thereof, and any term or provision of this Agreement may be amended or
supplemented at any time by the mutual consent of the parties hereto, except
that any waiver of any term or condition, or any amendment, of this Agreement
must be in writing.
(e) Governing Law. The laws of the State of Delaware shall govern the
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interpretation, validity and performance of the terms of this Agreement
regardless of the law that might be applied under principles of conflicts of
law.
(f) Successors. This Agreement shall be binding upon and inure to the
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benefit of the successors, assigns and heirs of the respective parties.
(g) Notices. All notices or other communications made or given in
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connection with this Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by registered or certified mail, return
receipt requested, to those listed below at their following respective addresses
or at such other address as each may specify by notice to the others:
To the Optionee:
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To the Company:
RoTech Healthcare Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx L, Xxxxx, Esq.
Copy to:
Xxxxx Raysman Xxxxxxxxx Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxx Xxxxxxxx, Esq.
(h) Waiver. The failure of a party to insist upon strict adherence to
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any term of this Agreement on any occasion shall not be considered a waiver
thereof or deprive that party of the right thereafter to insist upon strict
adherence to that term or any other term of this Agreement.
(i) Conflict with the Plan. In the event of any conflict or
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inconsistency between the provisions of this Agreement and the Plan, the
provisions of the Plan shall control.
(j) Injunctive Relief. The Optionee acknowledges and agrees that a
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violation of Section 2(h) hereof will cause the Company irreparable injury for
which an adequate remedy at law is not available. Accordingly, the Optionee
agrees that the Company shall be entitled to an injunction, restraining order or
other equitable relief to prevent the breach of such provision and to enforce
the terms and provisions hereof in any court of competent jurisdiction in the
United States or any state thereof, in addition to any other remedy to which it
may be entitled at law or equity.
(k) Titles; Construction. Titles are provided herein for convenience
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only and are not to serve as a basis for interpretation or construction of the
Agreement. The masculine pronoun shall include the feminine and neuter and the
singular shall include the plural, when the context so indicates.
[Signature page to follow]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Option
Agreement as of the day and year first above written.
ROTECH HEALTHCARE INC.
By:
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Name:
Title:
OPTIONEE
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