Exhibit 10(iii)10
THE IT GROUP, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
Pursuant to the
2000 STOCK INCENTIVE PLAN
This Non-Qualified Stock Option Agreement ("Agreement") consists of the
terms and conditions set forth in this document and in the Notice of Option
Grant (the "Grant Notice") provided by The IT Group, Inc., a Delaware
corporation (the "Company"), to the person named as Optionee on the Grant
Notice. This Agreement is made and entered into as of the Date of Grant
indicated on the Grant Notice.
WHEREAS, Optionee is an employee or director of the Company or any of its
subsidiaries or affiliates; and
WHEREAS, pursuant to the Company's 2000 Stock Incentive Plan (the "2000
Plan"), the committee of the Board of Directors of the Company administering the
2000 Plan (the "Committee") has approved the grant to Optionee of a non-
qualified option to purchase shares of the Common Stock, par value $.01 per
share, of the Company (the "Common Stock"), on the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
covenants set forth herein, the receipt and sufficiency of which consideration
is hereby acknowledged, the parties hereto hereby agree as follows:
1. Grant of Option; Certain Terms and Conditions. The Company hereby
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grants to Optionee, and Optionee hereby accepts, as of the Date of Grant
indicated on the Grant Notice, an option or options (the "Option") to purchase
the number of shares of Common Stock indicated on the Grant Notice (the "Option
Shares") at the Exercise Price per share indicated on the Grant Notice, which
Exercise Price shall not be less than the market value of the Option Shares on
the Date of Grant. The Option shall expire at 5:00 p.m., Pittsburgh time, on the
Expiration Date indicated on the Grant Notice and shall be subject to all of the
terms and conditions set forth in this Agreement. The Option is not intended to
qualify as an incentive stock option under Section 422 of the Internal Revenue
Code. On each anniversary of the Date of Grant, the Option shall become
exercisable to purchase ("vest with respect to") that number of Option Shares
(rounded to the nearest whole share) equal to the total number of Option Shares
multiplied by the Annual Vesting Rate indicated on the Grant Notice. By
executing the Grant Notice, Optionee agrees to be bound by the terms of this
Agreement.
2. Acceleration and Termination of Option.
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(a) Termination of Employment.
(i) Retirement. In the event that Optionee shall cease to be an
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employee of the Company or any of its subsidiaries or
affiliates (such event shall be referred to herein as the
"Termination" of such employee's "Employment") by reason of
retirement, which retirement, if Optionee is an employee of
the Company or any of its subsidiaries, is in accordance
with the Company's then-current retirement practices, then
the Option shall fully vest with respect to all Option
Shares upon the date of such
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Termination of Employment and shall terminate on the second
anniversary of the date of such Termination of Employment.
(ii) Death or Permanent Disability. If Optionee's Employment is
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Terminated by reason of the death or Permanent Disability
(as herein defined) of Optionee, then the Option shall fully
vest with respect to all Option Shares upon the date of such
Termination of Employment, shall be exercisable by Optionee
or, in the event of death, the person or persons to whom
Optionee's rights under the Option shall have passed by will
or by the applicable laws of descent or distribution, and
shall terminate on the first anniversary of the date of such
Termination of Employment. "Permanent Disability" shall mean
the inability to engage in any substantial gainful activity
by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous
period of not less than twelve (12) months. The Optionee
shall not be deemed to have a Permanent Disability until
proof of the existence thereof shall have been furnished to
the Committee in such form and manner, and at such times, as
the Committee may require. Any determination by the
Committee that Optionee does or does not have a Permanent
Disability shall be final and binding upon the Company and
Optionee.
(iii) Termination for Cause. If Optionee's Employment is
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Terminated for cause, then (A) the portion of the Option
that has not vested on or prior to the date of such
Termination of Employment shall terminate on such date and
(B) the remaining vested portion of the Option shall
terminate one (1) month from the date of such Termination of
Employment.
(iv) Other Termination. If Optionee's Employment is Terminated
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for any reason other than those enumerated in (i) through
(iii) of this Section 2(a), then (A) the portion of the
Option that has not vested on or prior to the date of such
Termination of Employment shall terminate on such date and
(B) the remaining vested portion of the Option shall
terminate ninety (90) days after the date of such
Termination of Employment.
(b) Termination of Director Status.
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(i) Retirement, Permanent Disability or Death. In the event the
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Optionee shall cease to be a director of the Company or any
of its subsidiaries or affiliates (such event shall be
referred to herein as the "Termination" of such director's
"Status") by reason of retirement as a director, death or
Permanent Disability, the provisions applicable to employees
of the Company or any of its subsidiaries or affiliates set
forth in Sections 2(a)(i) and 2(a)(ii) shall be applicable,
as appropriate. As used in this Section 2(b)(i), if Optionee
is a director of the Company or any of its subsidiaries,
retirement of a director shall mean such director has
completed his or her term(s) as a director of the Company or
any of its subsidiaries in accordance with the charter and
bylaws of the Company or any such subsidiary.
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(ii) Other Termination. In the event the Optionee shall cease to
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be a director of the Company or any of its subsidiaries or
affiliates for any other reason, the provisions applicable
to employees of the Company or any of its subsidiaries or
affiliates set forth in Section 2(a)(iv) shall be
applicable, as appropriate.
(iii) Service as Employee and Director. In the event the
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Optionee shall ever cease to serve as a director other than
on account of retirement or Permanent Disability as
specified in Section 2(b)(i) hereof, but shall continue to
serve or shall immediately thereafter serve as an employee,
then the provisions in Section 2(b)(ii) shall not be
applicable, and instead the provisions of Section 2(a) shall
apply. In the event the Optionee shall ever cease to serve
as an employee other than on account of retirement, but
shall continue to serve or shall immediately thereafter
serve as a director, then the provisions in Section 2(a)(iv)
shall not be applicable, and instead the provisions of
Section 2(b)(i) and (ii) shall apply.
(c) Death Following Termination of Employment. Notwithstanding
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anything to the contrary in this Agreement, if Optionee shall die
at any time after the Termination of his or her Employment and
Status and prior to the Expiration Date, then the remaining
vested but unexercised portion of the Option shall terminate on
the earlier of the Expiration Date or the first anniversary of
the date of such death.
(d) Acceleration of Option Upon a Change of Control. The Committee,
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in its sole discretion, may accelerate the exercisability of the
Option at any time and for any reason. In addition, the Option
shall fully vest with respect to all Option Shares immediately
prior to a Change of Control (as hereinafter defined), provided
that no such vesting shall occur (A) in the case of a Change of
Control of the type described in (ii) or (iii) below, if a two-
thirds majority of the members of the Company's Board of
Directors affirmatively recommends such Change of Control to the
Company's stockholders, or (B) in the case of a Change of Control
of the type described in (i) or (v) below, if a two-thirds
majority of the Company's Board of Directors approves such Change
of Control. A "Change of Control" shall mean the first to occur
of the following events:
(i) any date upon which the directors of the Company who were
nominated by the Board of Directors for election as
directors and/or were elected by the holders of the
Cumulative Convertible Participating Preferred Stock of the
Company cease to constitute a majority of the directors of
the Company; provided, however, that no individual initially
elected or nominated as a director of the Company as a
result of an actual or threatened election contest with
respect to directors or any other actual or threatened
solicitation of proxies or consents by or on behalf of any
person other than the Board shall be counted as having been
nominated by the Board of Directors for this purpose;
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(ii) a reorganization, merger or consolidation of the Company the
consummation of which results in the outstanding securities
of any class then subject to the Option being exchanged for
or converted into cash, property and/or securities not
issued by the Company,
(iii) the acquisition of substantially all of the property and
assets of the Company by any person or entity;
(iv) the dissolution or liquidation of the Company; or
(v) the date of the first public announcement that any person or
entity, together with all Affiliates and Associates (as such
capitalized terms are defined in Rule l2b-2 promulgated
under the Exchange Act) of such person or entity, shall have
become the Beneficial Owner (as defined in Rule l3d-3
promulgated under the Exchange Act) of voting securities of
the Company representing 35% or more of the voting power of
the Company; provided, however, that the terms "person" and
"entity," as used in this subsection (v), shall not include
(x) the Company, any of its subsidiaries, The Carlyle Group
and its Affiliates (y) any employee benefit plan of the
Company or any of its subsidiaries, or (z) any entity
holding voting securities of the Company for or pursuant to
the terms of any such plan.
(e) Other Events Causing Termination of Option. Notwithstanding
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anything to the contrary in this Agreement, the Option shall
terminate on the thirtieth day following the date of the
consummation of either of the following events, or upon such
later date as shall be determined by the Committee:
(i) the dissolution or liquidation of the Company;
(ii) the acquisition of substantially all of the property and
assets of the Company by any person or entity, unless the
terms of such acquisition shall provide otherwise.
3. Adiustments. In the event that the outstanding securities of the class
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then subject to the Option are increased, decreased or exchanged for or
converted into cash, property or a different number or kind of shares or
securities, or if cash, property, shares or securities are distributed in
respect of such outstanding securities, in either case as a result of a
reorganization, merger, consolidation, recapitalization, restructuring,
reclassification, dividend (other than a regular, quarterly cash dividend) or
other distribution, stock split, reverse stock split, spin-off or the like, or,
subject to the other provisions of this Agreement, in the event that
substantially all of the property and assets of the Company are sold, then,
unless the terms of such transaction shall provide otherwise, the Committee
shall make appropriate and proportionate adjustments in the number and type of
shares or other securities or cash or other property that may thereafter be
acquired upon the exercise of the Option; provided, however, that any such
adjustments in the Option shall be made without changing the aggregate Exercise
Price of the then unexercised portion of the Option.
4. Exercise. The Option shall be exercisable during Optionee's lifetime
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only by Optionee, by his or her guardian or legal representative, and after
Optionee's death only by the person or entity
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entitled to do so under Optionee's last will and testament or applicable
intestate law or, if approved by the Committee, by any permitted transferee to
whom the Option has been transferred. The Option may only be exercised by the
delivery to the Company of a written notice of such exercise pursuant to the
notice procedures set forth in Section 6 hereof, which notice shall specify the
number of Option Shares to be purchased (the "Purchased Shares") and the
aggregate Exercise Price for such shares (the "Exercise Notice"), together with
payment in full of such aggregate Exercise Price in cash or by a cashier's or
certified bank check payable to the Company; provided, however, that payment of
such aggregate Exercise Price may instead be made, in whole or in part at, the
election of the Optionee, either (A) by the delivery to the Company of a
certificate or certificates representing shares of Common Stock, duly endorsed
or accompanied by a duly executed stock powers, which delivery effectively
transfers to the Company good and valid title to such shares, free and clear of
any pledge, commitment, lien, claim or other encumbrance, (B) by authorizing the
withholding by the Company of shares of Common Stock that otherwise would be
issued to the Optionee as a result of the exercise of the Option (such shares to
be valued in either case on the basis of the aggregate fair market value thereof
on the date of such exercise) or (C) by such other method or combination of
methods as the Committee may approve; provided that (i) Optionee shall have
obtained the prior written approval of the Committee to pay the Exercise Price
pursuant to the methods set forth in clauses (A), (B) or (C) of this Section 4
and (ii) the Company is not then prohibited from purchasing or acquiring such
form of consideration as payment for shares of Common Stock.
5. Payment of Withholding Taxes. If the Company is obligated to withhold
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an amount on account of any federal, state or local tax imposed as a result of
the exercise of the Option, including, without limitation, any federal, state or
other income tax, or any F.I.C.A., state disability insurance tax or other
employment tax, then Optionee shall, concurrently with such exercise, pay such
amount to the Company in cash or by cashier's or certified bank check payable to
the Company; provided however, that payment of such amount may instead be made,
in whole or in part, at the election of the Optionee, (A) either by the delivery
to the Company of a certificate or certificates representing shares of Common
Stock, duly endorsed or accompanied by a duly executed stock powers, which
delivery effectively transfers to the Company good and valid title to such
shares, free and clear of any pledge, commitment, lien, claim or other
encumbrance, (B) by authorizing the withholding by the Company of shares of
Common Stock that otherwise would be issued to the Optionee as a result of the
exercise of the Option (such shares to be valued in either case on the basis of
the aggregate fair market value thereof on the date of such exercise) or (C) by
such other method or combination of methods as the Committee may approve;
provided that (i) the Company is not then prohibited from purchasing or
acquiring such shares of Common Stock, and (ii) Optionee shall have obtained the
prior written approval of the Committee to pay such amount pursuant to the
methods set forth in clauses (A), or (B) or (C) of this Section 5.
6. Notices. Any notice given to the Company shall be addressed to the
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Company at 0000 Xxxxxxx Xxxxxxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxx 00000, Attention:
Secretary, or at such other address as the Company may hereinafter designate in
writing to Optionee. Any notice given to Optionee shall be sent to the address
set forth below Optionee's signature hereto, or at such other address as
Optionee may hereafter designate in writing to the Company. Any such notice
shall be deemed duly given when sent by prepaid certified or registered mail and
deposited in a post office or branch post office regularly maintained by the
United States Government.
7. Stock Exchange Requirements; Applicable Laws. Notwithstanding anything
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to the contrary in this Agreement, no shares of stock purchased upon exercise of
the Option, and no certificate representing all or any part of such shares,
shall be issuable, issued or delivered if (a) such shares have not been admitted
to listing upon official notice of issuance on each stock exchange upon which
shares of
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that class are then listed or (b) in the opinion of counsel to the Company, such
issuance or delivery would cause the Company to be in violation of or to incur
liability under any federal, state or other securities law, or any requirement
of any stock exchange listing agreement to which the Company is a party, or any
other requirement of law or of any administrative or regulatory body having
jurisdiction over the Company.
8. Nontransferability. Except as expressly approved by the Committee,
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neither the Option nor any interest therein or in the shares issuable thereunder
may be sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise
transferred in any manner other than by will or the laws of descent and
distribution.
9. 2000 Plan. The Option is granted pursuant to the 2000 Plan, as in
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effect on the Date of Grant, and is subject to all the terms and conditions of
the 2000 Plan, as the same may be amended from time to time; provided, however,
that no such amendment shall deprive Optionee, without his or her consent, of
the Option or of any of Optionee's rights under this Agreement provided that no
such consent shall be required if the Committee determines in its sole
discretion and prior to the date of any Change of Control that such amendment
either (a) is required or advisable in order for the Company, the Plan or this
Option to satisfy any law or regulation or to meet the requirements of any
accounting standard, or (b) is not reasonably likely to significantly diminish
the benefits provided under such Option, or that any such diminishment has been
adequately compensated. The interpretation and construction by the Committee of
the 2000 Plan, this Agreement, the Option and such rules and regulations as may
be adopted by the Committee for the purpose of administering the 2000 Plan shall
be final and binding upon Optionee. Until the Option shall expire, terminate or
be exercised in full, the Company shall, upon written request therefor, send a
copy of the 2000 Plan, in its then-current form, to Optionee or any other person
or entity then entitled to exercise the Option.
10. Stockholder Rights. No person or entity shall be entitled to vote,
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receive dividends or be deemed for any purpose the holder of any Option Shares
until the Option shall have been duly exercised to purchase such Option Shares
in accordance with the provisions of this Agreement.
11. Employment Rights. No provision of this Agreement or of the Option
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granted hereunder shall (a) confer upon Optionee, if Optionee is an employee of
the Company or any of its subsidiaries, any right to participate in any employee
welfare or benefit plan or other program of the Company or any of its
subsidiaries (other than the 2000 Plan pursuant to this Option), (b) affect the
right of the Company and each of its subsidiaries to terminate the employment of
Optionee (and Optionee agrees that the Company and each of its subsidiaries may
terminate the employment of Optionee with or without cause at any time unless
Optionee and the Company or such subsidiary are parties to a written employment
agreement that expressly provides otherwise), (c) confer upon Optionee, if
Optionee is an employee or director of any of the Company's affiliates, any
right to continue his or her relationship with the Company notwithstanding that
Optionee remains an employee or director of such other entity, (d) if Optionee
is an employee or director of an affiliate of the Company, affect the right of
the Company to discontinue its relationship with such Optionee or Optionee's
employer or (e) confer upon Optionee, if Optionee is a director of the Company
or any of its subsidiaries, any right to continue as a director of the Company
or any of its subsidiaries, if such Optionee's status as a director has
otherwise terminated.
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12. Confidentiality and Non-Solicitation.
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(a) While employed by the Company and for a period of one year after
termination of Optionee's employment, and regardless of the
reason for termination, Optionee will not:
(i) Solicit or induce, or attempt to solicit or induce, any
Customer or Prospective Customer of the Company to purchase
competitive services from a source other than the Company,
or to cease doing business with the Company. The term
Customer or Prospective Customer means any customer for whom
Optionee has performed any service or of whom Optionee
learns during, or as a result of, employment with Company,
including all subsidiaries, divisions, parents and
affiliates thereof.
(ii) Solicit or induce, or attempt to solicit or induce, any
employee of the Company to terminate employment or to become
employed by a Competitive Business. The term Competitive
Business means environmental consulting, health and safety,
engineering, construction and remediation services, as well
as any other product or service which is competitive with
any product or service which is offered by the Company to
Customers during Optionee's employment.
(b) Optionee further agrees 1) to hold and safeguard for the benefit
of the Company all Company Confidential Information, and 2) not
to misappropriate, use for any other party's advantage, disclose
or otherwise make available to any person, Company's Confidential
Information except in the good faith performance of Optionee's
job duties to persons having a need to know such information for
the benefit of the Company. This obligation not to misappropriate
or misuse Company Confidential information is not limited in
time, and therefore continues after the termination of Optionee's
employment, regardless of the reason for termination of
employment.
(c) Confidential information includes, but is not limited to,
information relating to prices and customer contract provisions;
bid or proposal opportunities; expansion or acquisition plans;
marketing plans and activities; inventions; litigation and
litigation strategies; the identity of customers' contact
persons, customer requirements; operating costs; the identities
and performance of employees of the Company; business plans and
strategies; policies and procedures; and other non-public
information which is of value to the Company or to a competitor,
regardless of whether such information is patented, patentable,
copyrighted, or technically classifiable as a trade secret.
Confidential Information as used in this Agreement shall also
include the confidential information of the Company's customers,
vendors and others who entrust such information to the Company.
13. Arbitration and Attorney Fees. To the maximum extent permitted by law,
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all actions, proceedings, claims, disputes and other controversies arising out
of or related to this Agreement, or any of the matters referenced in this
Agreement, including Optionee's employment, if Optionee is an employee of the
Company or any of its subsidiaries or affiliates, including the termination
thereof, shall be decided by binding arbitration in the city in which Optionee
is based, or in the alternative, in the city in which the dispute arose, in
accordance with the rules of the American Arbitration Association. If the
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Company and Optionee have agreed in writing to other procedures and proceedings
for resolution of disputes, the Company may, at its election, consolidate any
proceedings into the arbitration provided for in this Agreement or the
arbitration provided for in this Agreement into any other proceedings otherwise
agreed to by Optionee. The arbitration panel shall be empowered to award
provisional (i.e., injunctive) relief upon proper application, but a party shall
be entitled, pending the appointment of all arbitrators and the convening of
such arbitration, to seek such relief from any court otherwise having competent
jurisdiction of such matter. In the event of any action or proceeding
(including arbitration) to construe or enforce this Agreement, the prevailing
party shall be entitled to recover its reasonable attorney fees and costs.
14. Severability. Each provision of this Agreement is severable from the
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others. Should any provision of this Agreement be found invalid or
unenforceable, such provision shall be ineffective only to the extent required
by law, without invalidating the remainder of such provision or the remainder of
this Agreement; provided, however, should the consideration received by Optionee
for any particular provision of this Agreement be found legally inadequate,
Optionee agrees to return all consideration received by reason of this
Agreement. The terms and conditions set forth herein shall survive the
termination of this Agreement.
15. Governing Law. This Agreement and the Option granted hereunder shall
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be governed by and construed and enforced in accordance with the laws of the
State of Delaware.
IN WITNESS WHEREOF, the Company and Optionee have duly executed this
Agreement as of the Date of Grant.
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NON-QUALIFIED STOCK OPTION AGREEMENT
Pursuant to the
2000 STOCK INCENTIVE PLAN
NOTICE OF GRANT AND AGREEMENT
Optionee:
Grant Number:
Date of Grant:
No. of Shares Purchasable:
Exercise Price Per Share:
Expiration Date:
Annual Vesting Rate:
OPTIONEE ACKNOWLEDGES AND AGREES THAT HE OR SHE HAS READ AND UNDERSTOOD AND
AGREES TO ALL OF THE TERMS OF THE OPTION AGREEMENT (INCLUDING SECTIONS 11 - 14)
OF WHICH THIS NOTICE OF GRANT AND AGREEMENT IS A PART. UNLESS OTHERWISE
EXTENDED BY THE COMPANY, THE OPTIONS GRANTED IN THIS AGREEMENT WILL BE DEEMED
WITHDRAWN UNLESS OPTIONEE RETURNS A SIGNED COPY OF THIS AGREEMENT WITH SIXTY
(60) DAYS OF THE DATE OF GRANT.
The IT Group, Inc. OPTIONEE
By:
Xxxxx X. Xxxx
Secretary
Name (Signature)
Street Address
City, State and Zip Code
Social Security Number
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