XXXXXXX X. XXXXX NUMBER OF SHARES 30,000
NONQUALIFIED STOCK OPTION
UNDER THE
DIVERSIFIED CORPORATE RESOURCES, INC.
AMENDED AND RESTATED 1996 NONQUALIFIED STOCK OPTION PLAN
THIS AGREEMENT is executed by Diversified Corporate Resources, Inc., a
Texas corporation (herein called "Company") to evidence the grant to Xxxxxxx X.
Xxxxx (herein called "Optionee") of a stock option effective as of May 31, 1997.
WHEREAS, the Optionee is an key employee of the Company; and
WHEREAS, the Company considers it desirable and in its best interests that
Optionee be given an opportunity to acquire an equity interest in the Company in
the form of an option to purchase shares of common stock of the Company (the
"Common Stock"); and
WHEREAS, this Option is granted under, and pursuant to the terms of the
Diversified Corporate Resources, Inc. Amended and Restated 1996 Nonqualified
Stock Option Plan (the "Plan").
NOW, THEREFORE, in consideration of the premises, it is agreed as follows:
1. GRANT OF OPTION. The Company shall and does hereby grant to Optionee
the option to purchase 30,000 shares (the "Shares") of Common Stock for the
prices per share in the manner and subject to the conditions hereinafter
provided.
2. TIME OF EXERCISE AND PRICES OF OPTION. Subject to the terms hereof,
the option herein granted must be exercised in whole or in part at any time
or times prior to May 31, 2002. The option herein granted (a) shall become
exercisable as to 10,000 shares of Common Stock if the Optionee is still an
officer of the Company on May 31,
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1998; the exercise price of this portion of the option shall be $4.00 per
share, (b) shall become exercisable as to an additional 10,000 shares of
Common Stock if the Optionee is still an officer of the Company on May 31,
1999; the exercise price of this portion of the option shall be $8.00 per
share, and (c) shall become exercisable as to an additional 10,000 shares
of Common Stock if the Optionee is still an officer of the Company on May
31, 2000, to the exercise price of this portion of the option shall be
$8.00 per share. The parties hereto acknowledge and agree that (A),
except as set forth below, vesting is contingent upon the Optionee being
an officer of the Company regardless of the reason that the Optionee may
cease to be an officer of the Company, and (B) subject to the restrictions
herein as to when the option is exercisable, the Optionee shall have the
right to select the portion of the option, and the related option price,
if and when the Optionee exercises any of this option.
If
(i) a "Special Change in Control" occurs, and
(ii) Optionee's employment with the Company terminates for any
reason other than Voluntary Termination or Termination for
Cause, during the twenty-four (24) month period immediately
following the Effective Date (as reasonably determined by
the Committee) of such Change in Control,
then, notwithstanding the vesting schedule above, and any other provision
of this Agreement to the contrary, this Option will become exercisable with
respect to all of the Shares subject to this Option at the exercise prices
at which the Option would have been exercisable if the Optionee had
continued in employment through the dates set forth in the
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preceding paragraph on which the Option would have been exercisable with
respect to all of the Shares, subject to this option and will terminate
as provided herein.
For the purposes hereof, "Voluntary Termination" shall mean the
optionee's resignation from the Company unless such resignation is as a direct
proximate result of (iii) without optionee's express written consent, the
assignment to optionee of any duties materially inconsistent with his positions,
duties, responsibilities and status with the Company on the Effective Date of
the Special Change in Control; (iv) a reduction of optionee's base compensation
and bonus to an amount which is greater than ten percent (10%) lower than such
compensation on the Effective Date of the Special Change In Control; (v)
relocation of optionee's principal location of work to any location which is
both (x) in excess of fifty (50) miles from the location of optionee's principal
location of work on the Effective Date of the Special Change in Control, and (y)
in excess of the sum of the distance from optionee's principal residence on such
Effective Date to the location of the optionee's principal location of work on
such Effective Date, plus 50 miles; (vi) failure by the Company to require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company, by agreement in form and substance reasonably satisfactory to the
optionee, expressly to assume the obligations of the Company under this
Agreement.
For all purposes hereof, "Termination For Cause" shall mean Optionee's
(vii) violation of any provision of this Agreement; (viii) conviction of a
felony, or a misdemeanor involving moral turpitude; (ix) engagement in any act
or omission constituting fraud under the law of the State of Texas; (x)
engagement in gross misconduct in the course and scope of Optionee's employment
with the Company, including, without limitation, indecency, immorality,
in-subordination, dishonesty, unlawful harassment, abuse of alcohol or
controlled substances, or
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fighting, or (xi) Optionee's intentional failure to perform material stated
duties (but only after receiving written notice thereof and being given a
reasonable period, not less than 30 days, to cure said intentional failure by
taking such reasonable corrective action as shall be reasonably within his
power at the time of reference), all as reasonably determined by the
Committee in its sole discretion.
For all purposes hereof "Special Change in Control" means (i) any person or
entity, including a "group" as defined in Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), other than the Company, a
majority-owned subsidiary thereof or X. Xxxxxxx Xxxxx ("XXXXX") and any
affiliate of Xxxxx, becomes the beneficial owner (as defined in Schedule 13(d)
under the Exchange Act) of the Company's securities having 25% or more of the
combined voting power of the then outstanding securities of the Company that may
be cast for the election of directors of the Company; or (ii) as the result of,
or in connection with, any cash tender or exchange offer, merger or other
business combination, sales of assets or contested election, or any combination
of the foregoing transactions, less than a majority of the combined voting power
of the then outstanding securities of the Company or any successor corporation
or entity entitled to vote generally in the election of the directors of the
Company or such other corporation or entity after such transaction are
beneficially owned (as defined in Section 13(d) of the Exchange Act) in the
aggregate by the holders of the Company's securities entitled to vote generally
in the election of directors of the Company immediately prior to such
transaction; or (iii) during any period of two consecutive years, individuals
who at the beginning of any such period constitute the Board of Directors of
the Company cease for any reason to constitute at least a majority thereof,
unless the election, or the nomination for election by the Company's
shareholders, of each director of the Company first elected during such period
was approved by
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a vote of at least two-thirds of the directors of the Company then still in
office who were directors of the Company at the beginning of any such period.
The "Effective Date" of such Special Change in Control shall be the earlier
of the date on which an event described in (i), (ii), or (iii) occurs, or if
earlier, the date of the occurrence of (iv) the approval by shareholders of
an Agreement by the Company, the consummation of which would result in an
event described in (i), (ii), or (iii), or (v) the acquisition of beneficial
ownership, directly or indirectly, by any entity, person or group (other than
the Company or a subsidiary of the Company) of securities of the Company
representing 5% or more of the combined voting power of the Company's
outstanding securities, provided, however, that the events described in (iv)
and (v) will be considered the Effective Date of a Special Change in Control
only if they are followed within six (6) months by an event described in (i),
(ii) or (iii).
3. METHOD OF EXERCISE. (a) In order to exercise this Option, in whole or
in part, the Optionee shall deliver to the Company at its principal place
of business, or at such other offices as shall be designated by the Company
(i) a written notice of such Optionee's election to exercise this Option,
which notice shall specify the number of Shares to be purchased pursuant to
such exercise and (ii) either (A) cash or a check payable to the order of
the Company, (B) notice that the exercise price is satisfied by reduction
of the number of Shares to be received by Optionee upon exercise of this
Option as provided in Section (b) below, with the amount of such reduction
specified in such notice, (C) shares of Common Stock having a fair market
value equal to the Exercise Price, or (D) a combination of the above. The
Company shall undertake to make prompt delivery of the stock certificate(s)
evidencing such part of the Shares, provided that if any law or regulation
requires the Company to take any action with respect to the Shares
specified in
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such notice before the issuance thereof, then the date of delivery of such
Shares shall be extended for the period necessary to take such action.
(b) At the election of the Optionee, the Optionee may exercise this Option
without a cash payment of the exercise price by designating that the number of
Shares issuable to Optionee upon such exercise shall be reduced by the number of
Shares having a fair market value equal to the amount of the total Exercise
Price for such exercise. In such instance, no cash or other consideration will
be paid by the Optionee in connection with such exercise and no commission or
other remuneration will be paid or given by the Optionee or the Company in
connection with such exercise.
(c) For all purposes relating to the surrender or delivery of Shares in
satisfaction of obligations described in subsection (a) and (b) of this Section,
the fair market value of the shares of Common Stock delivered or surrendered
shall be determined as of the business day next preceding the date of their
surrender or delivery, and shall mean the price at which such shares would
exchange hands between a willing buyer and willing seller, neither of whom are
under compulsion to buy or sell, as reasonably determined by the Committee;
provided, however, that so long as such shares are listed on a national stock
exchange or quoted on the National Association of Securities Dealers Automated
Quotation System ("NASDAQ"), it shall mean the closing sale price (or, if no
closing sale price is quoted, the mean between the closing bid and sale price)
of such shares on such exchange or on NASDAQ on such next business day, or, if
no such shares were traded on such business day, the closing sale price (or, if
no closing sale price is quoted, the mean between the closing bid and sale
price) on the next preceding business day on which such shares were traded.
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(d) Upon the exercise of an Option, and before the transfer of Shares, the
Optionee shall be required to pay to the Company, in cash or in Shares
(including, but not limited to, the reservation to the Company of the requisite
number of Shares otherwise payable to such person with respect to such Option in
the manner described in (b)) the amount which the Company reasonably determines
to be necessary in order for the Company to comply with applicable federal or
state tax withholding requirements, and the collection of employment taxes;
provided, further, that the Committee may require that such payment be made in
cash.
4. TERMINATION OF OPTION. To the extent not theretofore exercised, the
Option herein granted shall terminate with respect to Shares which have not
vested immediately upon Optionee's termination of employment for any
reason, and shall terminate with respect to Vested Shares on the earlier
of (a) May 31, 2002 (b) 180 days from the date on which Optionee's
employment with the Company is terminated for any reason other than the
death or disability of the Optionee, and (c) one (1) year from the date on
which Optionee's employment with the Company is terminated if such
termination is due to death or disability of the Optionee.
5. RIGHTS PRIOR TO EXERCISE OF OPTION. The Option herein granted is
nontransferable by Optionee except as herein otherwise provided. Unless the
Optionee is deceased or disabled, with the determination of the existence or
nonexistence of such disability such disability left to the reasonable
discretion of the Committee, the Option herein may only be exercised by the
Optionee. If the Optionee dies during the period of time that all or any of
part of this Option is exercisable, the Optionee's executor or legal
representative may exercise all or any part of this Option with respect to the
Shares which are vested, at any time or times prior to the termination of the
Option. If the Optionee is disabled, as aforesaid, the Optionee's legal
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representative may exercise all or any part of this Option with respect to the
Shares which are Vested, at any time or times prior to the termination of the
Option. Optionee shall have no rights as a stockholder with respect to the
Shares until payment of the Exercise Price for the Shares purchased by exercise
of the Option, and the issuance of the Shares involved.
6. BINDING EFFECT. Without limitation, the option herein granted is
issued under, and granted in all respects subject to all of the provisions of,
the Plan, all of which provisions of the Plan are incorporated herein by
reference; provided, however, without limitation, that the provisions of this
Agreement will determine the agreement of the parties with respect to each
matter set forth herein to the extent the provisions of this Agreement do not
require a result that is inconsistent with the Plan; and provided, finally, that
the parties expressly agree that no inference shall be drawn with respect to the
intent of the parties based on the inclusion of, or reference to, some
provisions of the Plan in this Agreement, and the omission of such inclusion or
reference with respect to other provisions of the Plan in this Agreement; and
provided, finally, that this Agreement shall be binding upon and inure to the
benefit of the Company, and its representatives, successors and assigns, and the
Optionee and his or her legal representative (to the extent expressly
permitted).
7. MULTIPLE ORIGINALS. This Agreement may be executed in multiple
counterparts with each counterpart constituting an original for all purposes.
8. AMENDMENT. This Agreement may not be amended or revised in such a
manner as to impair the rights of the Optionee without Optionee's written
consent.
9. TOTAL AGREEMENT. This Agreement may not be amended or revised except
by a written instrument executed by both of the parties to this Agreement.
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10. COMMITTEE AUTHORITY. Any questions concerning the interpretation of
this Agreement, including without limitation the incorporated provisions of the
Plan, shall be determined by the Committee in its reasonable discretion.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
this ___ day of May, 1998, but effective as of the May 31, 1997.
DIVERSIFIED CORPORATE RESOURCES, INC.
By: /s/ M. Xxx Xxxxxxx
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Name: X. Xxx Xxxxxxx
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Title: President
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/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
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