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EXHIBIT 10.2
CITATION COMPUTER SYSTEMS, INC.
NONQUALIFIED STOCK OPTION AGREEMENT
This Nonqualified Stock Option Agreement (this "Agreement") is
entered into as of October 15, 1999 (the "Date of Grant") by and between
CITATION Computer Systems, Inc., a Missouri corporation (the "Company"), and
Xxxxxxx X. Xxxxx (the "Optionee").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Company, in order to induce the Optionee to
continue in the employee of the Company and to contribute to the success of the
Company, desires to grant the Optionee an option to acquire a proprietary
interest in the Company through the purchase of shares of stock of the Company;
and
WHEREAS, the Company has determined that it is in the best
interests of the Company and its shareholders to grant the option provided for
herein (the "Option") to the Optionee pursuant to the terms of this Agreement.
NOW THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
3. Grant of Option. The Company hereby grants to the Optionee
the right and option to purchase, on the terms and conditions hereinafter set
forth, 50,000 shares (the "Option Shares") of common stock, $0.10 par value per
share, of the Company (the "Common Stock"). The purchase price of the Option
Shares shall be $1.625 per share (the "Exercise Price"). This Option is intended
to be treated as a nonqualified stock option. Capitalized terms shall have the
meanings provided in this Agreement.
4. Term of Option. The maximum term of the Option shall be
for ten (10) years ending October 15, 2009.
3. Vesting of Option. The Option Shares shall vest and become
exercisable three months after the Date of Grant. Notwithstanding the foregoing,
all Option Shares shall become automatically vested upon the occurrence of a
Change of Control (as defined in the individual's Change of Control Agreement
with the Company).
4. Exercise of Option.
(a) Upon vesting of Option Shares, the Option shall be
exercisable with respect to such Option Shares from the date of vesting until
the earlier of (i) ninety (90) days after termination of the Optionee's tenure
as an employee of the Company for any reason or (ii) the tenth (10th)
anniversary of the Date of Grant (the "Expiration Date"); provided, however,
that if Optionee dies within one year after termination of the Optionee's tenure
as an employee for any reason, then the period of exercise following death shall
be one year; provided further, however, that in no event shall this Option be
exercised more than ten years after the Date of Grant.
(b) This Option may be exercised by delivering to the
Company at its principal executive office written notice of intent to so
exercise. Such notice shall specify the number of Option Shares for which the
Option is being exercised and shall be accompanied by payment in full of the
Exercise Price and any applicable taxes or like requirements pursuant to Section
8 hereof. Such payment shall be made (i) in cash or by check or, in the
discretion of the Board of Directors, either (ii) by the delivery of shares of
Common Stock of the Company then owned by the Optionee which shares have been
owned for at least six months and have an aggregate fair market value equal to
Exercise Price, or (iii) a request to withhold from the number of shares of
Common Stock otherwise issuable upon exercise of the Option that whole number of
shares of Common Stock having an aggregate fair market value equal to the
Exercise Price, or (iv) by a combination of the foregoing.
5. Employment Rights Not Affected. Neither the granting of the
Option or its exercise shall be construed as granting to the Optionee any right
with respect to continuance of employment with the Company. Except as may
otherwise be limited by a written agreement between the Company and the
Optionee, the right of the
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EXHIBIT 10.2
Company to terminate at will the Optionee's employment with the Company
at any time and for any reason whatsoever is specifically reserved by the
Company, and acknowledged by the Optionee.
6. Transferability. Except as required by law, this Option is
not transferable, to other than a Permissible Transferee, other than by will or
the laws of descent and distribution or pursuant to a domestic relations order
(as defined under the Internal Revenue Code). A Permissible Transferee is a
person or entity, other than a participant, to whom stock options may be
transferred. Permissible Transferees are limited to the following persons or
entities: (i) one or more members of the participant's family; (ii) one or more
trusts for the benefit of the participant and/or one or more members of the
participant's family; or (iii) one or more partnerships (general or limited),
corporations, limited liability companies or other entities in which the
aggregate interests of the participant and members of the participant's family
exceed 80% of all interests in such entity. For this purpose, the participant's
family includes only the participant's spouse, children and grandchildren.
During the Optionee's lifetime, the Option shall be
exercisable only by the Optionee or a Permissible Transferee. In the event of
the Optionee's death, exercise or payment shall be made only by or to a
transferee under a domestic relations order, a Permitted Transferee, the
executor or administrator of the estate of the deceased Optionee or the person
or persons to whom the deceased Optionee's rights under the benefit shall pass
by will or the applicable laws of descent and distribution, and only to the
extent that the deceased Optionee was entitled thereto at the date of death.
7. Adjustments Upon Changes in Capitalization, Etc. In the
event the Company shall at any time change the number of issued shares of Common
Stock without new consideration to the Company (such as by stock dividend, stock
split or reorganization), then to the extent the Option hereunder remains
outstanding and unexercised, there shall be a corresponding adjustment as to the
number of shares covered under the Option and in the Exercise Price per share
such that the aggregate consideration payable to the Company and the value of
the Option shall not be changed.
8. Withholding. The Optionee agrees to make appropriate
arrangements with the Company for satisfaction of any applicable Federal, state
or local income tax, withholding requirements or like requirements, including
the payment to the Company at the time of exercise of the Option of all such
taxes and requirements.
9. Amendment of Option. The Option may be amended by the Board
of Directors of the Company at any time (i) if the Board determines, in its sole
discretion, that amendment is necessary or advisable in light of any addition to
or change in the Code or in the regulations issued thereunder, or any federal or
state securities law or other laws or regulation, which change occurs after the
Grant Date and by its terms applies to the Option; or (ii) other than in the
circumstances described in clause (I), with the consent of the Optionee. The
foregoing notwithstanding, the Company may, in its sole discretion, cancel the
Option at any time prior to the Optionee's exercise of the Option if, in the
opinion of the Company, the Optionee engages in activities contrary to the
interest of the Company.
10. Notice. Any notice to the Company provided for in this
Agreement shall be addressed to it in care of its Secretary at its executive
offices at 000 Xxxxx Xxxxx Xxxx Xxxx, Xxxxx 000, Xxxxxxxxxxxx, Xxxxxxxx 00000,
and any notice to the Optionee shall be addressed to the Optionee at the current
address shown on the Payroll Records of the Company. Any notice shall be deemed
to be duly given if and when properly addressed and deposited, postage paid, in
the United States mail or when hand delivered to the party to whom it is
addressed.
11. Governing Law. This Agreement shall be construed in
accordance with and shall be subject to the internal laws of the State of
Missouri, except to the extent preempted by federal law.
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EXHIBIT 10.2
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written. By execution of this
Agreement, the Optionee acknowledges receipt of a copy of the Plan.
CITATION COMPUTER SYSTEMS, INC.
By:___________________________________
OPTIONEE:
______________________________________
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