Exhibit 10.54
NOVA HOLDINGS, INC.
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Non-Qualified Stock Option Agreement
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April 30, 1998
Director/Optionee: Xxxxxxx X. Xxxxxxxxx
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Number of shares of
Common Stock subject
to this Agreement: 20,000
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Pursuant to the Nova Holdings, Inc. and its Subsid iaries
Stock Option and Restricted Stock Purchase Plan (the "Plan"), the Board of
Directors of Nova Holdings, Inc. (the "Company") has granted to you on this date
an option (the "Op tion") to purchase the number of shares of the Company's
Common Stock, $.01 par value ("Common Stock"), set forth above. Such shares (as
the same may be adjusted as described in Section 12 below) are herein referred
to as the "Option Shares." The Option shall constitute and be treated at all
times by you and the Company as a "non-qualified stock option" for Federal
income tax purposes. The terms and conditions of the Option are set out below.
1. Date of Grant. The Option is granted to you on April 30,
1998.
2. Termination of Option. Your right to exercise the Option
(and to purchase the Option Shares) shall expire and terminate in all events on
the earlier of (i) ten years from date of grant or (ii) the date provided in
Section 9 below in the event you cease to serve as a director of the Company or
any subsidiary or parent thereof.
3. Option Price. The purchase price to be paid upon the
exercise of the Option is $6.00 per share (subject to adjust ment as provided in
Section 12 below).
4. Vesting Provisions. Except as provided in Section 5
below, you will not be entitled to exercise the Option (and purchase any Option
Shares) prior to April 30, 1999. Commencing on April 30, 1999, and on each of
the three succeeding anniversa xxxx of that date on which you shall continue to
serve as a director of the Company or any subsidiary or parent thereof,
you shall become entitled to exercise the Option with respect to 25% of the
Option Shares (as the same may be adjusted from time to time pursuant to Section
12 below, and rounded to the nearest whole share) until the Option expires and
terminates pursuant to Section 2 hereof.
5. Accelerated Vesting for Change of Control. (a)
Concurrently with the occurrence of any "Change of Control" (as defined below)
in connection with which Welsh, Carson, Xxxxxxxx & Xxxxx VII, L.P. ("WCAS VII")
shall achieve an "Internal Rate of Return" (as defined below) of 35% or more,
you shall become entitled to exercise the Option with respect to all the Option
Shares (with the effect that you shall be deemed to be entitled to exercise the
Option immediately prior to the consummation of such Change of Control with
respect to all Option Shares not theretofore purchased by you).
For purposes of the foregoing, the term "Change of Control"
means the acquisition of (a) beneficial ownership of more than 50% of the voting
equity securities of the Company or any successor to the Company (by merger or
otherwise) or (b) all or substantially all the assets of the Company, by any
person or entity (including, without limitation, any group within the meaning of
Section 13(d)(3) of the Securities Exchange Act, as amended) other than WCAS VII
and WCAS Healthcare Partners, L.P., or their respective affiliates.
For purposes of the foregoing, the term "Internal Rate of
Return" means, as of any date, an internal rate of return or discount factor
that nets to zero, calculated on a daily basis, a cash flow stream consisting of
"cash ins" and "cash outs." For this purpose, "cash ins" equal (i) the aggregate
purchase price of all equity securities (including, without limitation, pre
ferred stock whether or not convertible) of the Company purchased by WCAS VII.
For this purpose, "cash outs" equal the sum of (x) the aggregate amounts of
income and gain realized and capital recovered by WCAS VII in respect of its
investment in the Company as of such specified date, plus (y) the aggregate fair
market value of all equity securities of the Company held by WCAS VII at the
close of business on the date of a Change of Control. Such fair market value
shall be determined in good faith by the Board of Directors of the Company, in
the case of a transaction de scribed in clause (a) of the definition of Change
of Control, having due regard for the price per share reflected in the last
transaction or event giving rise to such Change of Control, unless such price
was established on other than an arm's-length basis, and in the case of a
transaction described in clause (b) of such definition, assuming liquidation of
the Company immedi ately after such acquisition of assets. Internal Rates of
Return shall be determined from the date the "cash in" is deemed
to occur to the date the "cash out" is deemed to occur. For this purpose, "cash
ins" shall be deemed to occur on the date that securities are purchased from the
Company or the holder thereof and the purchase price therefor paid in full, and
"cash outs" shall be deemed to occur on the date on which any income or gain is
realized or capital recovered or, if later, the date of a Change of Control.
6. Additional Provisions Relating to Exercise. (a) Once you
become entitled to exercise the Option (and purchase Option Shares) as provided
in Sections 4 and 5, such right will continue until the date on which the Option
expires and termi nates pursuant to Section 2 hereof.
(b) The Board of Directors of the Company, in its sole
discretion, may at any time accelerate the time set forth in Section 4 or 5
hereof at which the Option may be exercised by you with respect to any Option
Shares.
7. Exercise of Option. To exercise the Option, you must
deliver a completed copy of the attached Option Exercise Form to the address
indicated on the Form, specifying the number of Option Shares being purchased as
a result of such exercise, together with payment of the full option price for
the Option Shares being purchased. Payment of the option price may be made, at
your election, (i) in cash or by check, (ii) by delivery to the Company of a
number of shares of Common Stock which shall have been owned by you for not less
than six months at the date of delivery having a fair value as of the date of
exercise, as determined in good faith by the Board of Directors of the Company,
equal to the option price, or (iii) by tendering such other consideration as may
be acceptable to the Board of Directors of the Company.
8. Transferability of Option. The Option may not be
transferred by you (other than by will or the laws of descent and distribution)
and may be exercised during your lifetime only by you.
9. Cessation of Service as a Director. In the event that you
cease to serve as a director of the Company or any subsidiary or parent thereof
at any time the Option may only be exercised within three months after the date
you cease to so serve, and only to the same extent that you were entitled to
exercise the Option on the date you ceased to so serve as a director and had not
previously done so. Notwithstanding any provision contained in this Section 9 to
the contrary, in no event may the Option be exercised to any extent by anyone
after the tenth anniversary of the date of grant.
10. Representations. (a) You represent and warrant to the
Company that, upon exercise of the Option, you will be acquiring the Option
Shares for your own account for the purpose of investment and not with a view to
or for sale in connection with any distribution thereof, and you understand that
(i) nei ther the Option nor the Option Shares have been registered with the
Securities and Exchange Commission by reason of their issu ance in a transaction
exempt from the registration requirements of the Securities Act and (ii) the
Option Shares must be held indefinitely by you unless a subsequent disposition
thereof is registered under the Securities Act or is exempt from such
registration. The stock certificates for any Option Shares issued to you will
bear the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THEY HAVE
BEEN REGISTERED UNDER THAT ACT OR AN EXEMPTION FROM
REGISTRATION IS AVAILABLE.
(b) You further represent and warrant that you under stand the
Federal, state and local income tax consequences of the granting of the Option
to you, the acquisition of rights to exercise the Option with respect to any
Option Shares, the exer cise of the Option and purchase of Option Shares, and
the subse quent sale or other disposition of any Option Shares. In addi tion,
you understand that the Company will be required to with hold Federal, state or
local taxes in respect of any compensation income realized by you upon exercise
of the Option granted hereunder. To the extent that the Company is required to
with hold any such taxes, you hereby agree that the Company may deduct from any
payments of any kind otherwise due to you an amount equal to the total Federal,
state and local taxes required to be so withheld, or if such payments are
inadequate to satisfy such Federal, state and local taxes, or if no such
payments are due or to become due to you, then you agree to provide the Company
with cash funds or make other arrangements satisfactory to the Company regarding
such payment. It is understood that all matters with respect to the total amount
of taxes to be withheld in respect of any such compensation income shall be
determined by the Board of Directors in its sole discretion.
11. Notice of Sale. You agree to give the Company prompt
notice of any sale or other disposition of any Option Shares that occurs (i)
within two years from the date of the granting of the Option to you, or (ii)
within one year after the transfer of such Option Shares to you upon the
exercise of the Option.
12. Reorganization, Reclassification, Consolidation, Merger or
Sale. (a) In the event that, after the date hereof, the outstanding shares of
the Company's Common Stock shall be in creased or decreased or changed into or
exchanged for a different number or kind of shares of stock or other securities
of the Company or of another corporation through reorganization, merger or
consolidation, recapitalization, reclassification, stock split, split-up,
combination or exchange of shares or declaration of any dividends payable in
Common Stock, the Board of Directors of the Company shall appropriately adjust
the number of shares of Common Stock (and the option price per share) subject to
the unexercised portion of the Option (to the nearest possible full share), and
such adjustment shall be effective and binding for all purposes of this
Agreement and the Plan.
(b) If any capital reorganization or reclassification of the
capital stock of the Company or any consolidation or merger of the Company with
another corporation, or the sale of all or substantially all its assets to
another corporation, shall be effected after the date hereof in such a way that
holders of Common Stock shall be entitled to receive stock, securities or assets
with respect to or in exchange for Common Stock, then you shall thereafter have
the right to receive upon the basis and upon the terms and conditions specified
in the Option and in lieu of the shares of Common Stock of the Company
immediately thereto fore receivable upon the exercise of the Option, such shares
of stock, securities or assets (including cash) as may be issued or payable with
respect to or in exchange for a number of outstand ing shares of such Common
Stock equal to the number of shares of such stock immediately theretofore so
receivable had such reorga nization, reclassification, consolidation, merger or
sale not taken place.
13. Plan Documents. This Agreement is qualified in its
entirety by reference to the provisions of the Plan, which are incorporated
herein by reference.
14. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Tennessee. If any one or
more provisions of this Agreement shall be found to be illegal or unenforceable
in any respect, the validity and enforceability of the remaining provisions
hereof shall not in any way be affected or impaired thereby.
Please acknowledge receipt of this Agreement by signing the
enclosed copy of this Agreement in the space provided below and returning it
promptly to the Secretary of the Company.
NOVA HOLDINGS, INC.
By
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Name: Xxxxx X. Xxxxxxx
Title: Chairman and CEO
Accepted and Agreed to
as of April 30, 1998:
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Director/Optionee
NOVA HOLDINGS, INC. AND ITS SUBSIDIARIES
STOCK OPTION AND RESTRICTED STOCK PURCHASE PLAN
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OPTION EXERCISE FORM
I, , a Participant under the Nova Holdings, Inc. and its Subsidiaries
Stock Option and Restricted Stock Purchase Plan (the "Plan"), do hereby exercise
the right to purchase __________ shares of Common Stock, $.01 par value, of Nova
Holdings, Inc. pursuant to the Option granted to me on April 30, 1998.
Enclosed herewith is (indicate one):
[ ] Cash or a check in the amount of $_______, an amount equal to
the total exercise price for the shares of Common Stock being
purchased pursuant to this Option Exercise Form.
OR
[ ] A certificate of certificates representing shares of
Common Stock of the Company, together with stock powers
and other documentation requested by the Company, for a
number of shares of Common Stock which the undersigned
has owned for not less than six months having a fair
value as of the date hereof equal to the total exercise
price for the shares of Common Stock being purchased
pursuant to this Option Exercise Form.
Date:
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Signature
Send a completed copy of this Option Exercise Form to:
Nova Holdings, Inc.
0000 Xxxxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: Secretary
