TELETECH HOLDINGS, INC. NON-QUALIFIED STOCK OPTION AGREEMENT (Vice President and above)
Exhibit 10.07
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the “Agreement”) is entered into between
TELETECH HOLDINGS, INC., a Delaware corporation (“TeleTech”), and
(“Optionee”), as of (the “Grant Date”). In consideration of the
mutual promises and covenants made herein, the parties hereby agree as follows:
1. Grant of Option. Subject to the terms and conditions of the TeleTech Holdings,
Inc. 1999 Stock Option and Incentive Plan, as amended (the “Plan”), a copy of which is
attached hereto and incorporated herein by this reference, TeleTech grants to Optionee an option
(the “Option”) to purchase
shares (the “Shares”) of TeleTech’s common
stock, $0.01 par value (the “Common Stock”), at a price equal to US $ per share (the
“Option Price”). The Option Price has been determined by the Compensation Committee of the
Board of Directors of TeleTech (the “Committee”), acting in good faith, to be the fair
market value of the Common Stock on the Grant Date based upon the last sale price for
Common Stock reported by The Nasdaq Stock Market, Inc. as of the close of business on the Grant
Date.
The Option is not intended to qualify as an incentive stock option described in Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”). All provisions of this
Agreement are to be construed in conformity with this intention.
2. Term: Option Rights. Except as provided below, the Option shall be valid for a
term commencing on the Grant Date and ending 10 years after the Grant Date (the “Expiration
Date”).
(a) Rights Upon Termination of Employment. If Optionee ceases to be employed by
TeleTech or any of its subsidiaries or affiliates (collectively, the “Subsidiaries”) for
any reason other than (i) for “Cause” (as defined herein), (ii) Optionee’s death, or
(iii) Optionee’s mental, physical or emotional disability or condition (a “Disability”),
any then vested portion of the Option shall be exercisable at any time prior to the earlier of the
Expiration Date or the date 90 days after the date of termination of Optionee’s employment.
(b) Rights Upon Termination For Cause. If Optionee’s employment with TeleTech and/or
its Subsidiaries is terminated for Cause, the Option shall be immediately cancelled, no portion of
the Option may be exercised thereafter and Optionee shall forfeit all rights to the Option. The
term “Cause” shall have the meaning given to such term or to the term “For Cause” or other similar
phrase in Optionee’s Employment Agreement with TeleTech or any Subsidiary; provided, however, that
(i) if at any time Optionee’s employment with TeleTech or any Subsidiary is not governed by an
employment agreement or if such employment agreement does not define “Cause,” then the term “Cause”
shall have the meaning given to such term in the Plan, and (ii) ”Cause” shall exclude Optionee’s
death or Disability.
(c) Rights Upon Optionee’s Death or Disability. If Optionee’s employment with
TeleTech and/or its Subsidiaries is terminated as a result of (i) Optionee’s death, any then vested
portion of the Option may be exercised at any time prior to the earlier of the Expiration Date or
the date 180 days after the date of Optionee’s death, or (ii) Optionee’s Disability, any then
vested portion of the Option may be exercised at any time prior to the earlier of the Expiration
Date or the date 180 days after the date of Optionee’s Termination Date as a result of Optionee’s
Disability.
3. Vesting. The Option may only be exercised to the extent vested. Any vested
portion of the Option may be exercised at any time in whole or from time to time in part. The
Option shall vest according to the following schedule and may be accelerated in accordance with
Section 3A below (each date set forth below, a “Vesting Date”):
| Cumulative | ||
| Percentage of |
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| Vesting Date | Option Vested | |||||||
| , | 25 | % | ||||||
| , | 50 | % | ||||||
| , | 75 | % | ||||||
| , | 100 | % | ||||||
Optionee must be employed by TeleTech or any Subsidiary on any Vesting Date, in order to vest in
the portion of the Option set forth in the chart above that vests on such Vesting Date. No portion
of the Option shall vest between Vesting Dates; if Optionee ceases to be employed by TeleTech or
any Subsidiary for any reason, then any portion of the Option that is scheduled to vest on any
Vesting Date after the date Optionee’s employment is terminated automatically shall be forfeited as
of the termination of employment.
3A. Vesting Following a Change in Control.
(a) Accelerated Vesting. Notwithstanding the vesting schedule contained in Section 3,
(i) upon a Change in Control (as hereinafter defined), any unvested portion of the
Option that is scheduled to vest (pursuant to Section 3) within 24 months following the date
the Change of Control becomes effective shall vest and become immediately exercisable as of
the effective date of the Change of Control, with the remainder of the unvested portion of
the Option vesting pursuant to Section 3, as accelerated by this Section 3A and clarified by
the following example:
For example, assume that on June 1, 2002 an optionee was granted an option
to acquire 10,000 shares of Common Stock, which option vests over five
years, pro rata, on each anniversary of the grant date. On June 5, 2003, a
Change of Control is consummated. As of June 5, 2003, the optionee will be
fully vested in the option with respect to 6,000 shares (i.e., the 2002
shares that vested on June 1, 2003, plus an additional 4,000 shares that
vested upon the change of control on June 5, 2003 in accordance with the
accelerated vesting provisions of this Section 3A). The remaining
unvested portion of the option would vest (assuming all other conditions to
vesting are satisfied) with respect to the remaining 4,000 shares on each of
June 1, 2004 (2,000 shares) and June 2, 2005 (2,000 shares).
(ii) if Optionee’s employment with TeleTech or any Subsidiary is terminated within 24
months following a Change in Control, then the entire amount of the Option shall become 100%
vested and immediately exercisable as of Optionee’s Termination Date (as defined herein);
provided, however, that the accelerated vesting described in the foregoing
clause (ii) shall not apply if Optionee’s employment with TeleTech is terminated (A) by
Optionee for any reason other than for “Good Reason” (as defined herein), or (B) by TeleTech
for “Cause” (as defined herein).
(b) Definition of “Change in Control”. For purposes of this Agreement, “Change in
Control” means the occurrence of any one of the following events:
(i) any consolidation, merger or other similar transaction (A) involving TeleTech, if
TeleTech is not the continuing or surviving corporation, or (B) which contemplates that all
or substantially all of the business and/or assets of TeleTech will be controlled by another
corporation;
(ii) any sale, lease, exchange or transfer (in one transaction or series of related
transactions) of all or substantially all of the assets of TeleTech (a
“Disposition”); provided, however, that the foregoing shall not
apply to any Disposition to a corporation with respect to which, following such Disposition,
more than 51% of the combined voting power of the then outstanding voting securities of such
corporation is
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then beneficially owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners of at least 51% of the then
outstanding Common Stock and/or other voting securities of TeleTech immediately prior to
such Disposition, in substantially the same proportion as their ownership immediately prior
to such Disposition;
(iii) approval by the stockholders of TeleTech of any plan or proposal for the
liquidation or dissolution of TeleTech, unless such plan or proposal is abandoned within 60
days following such approval;
(iv) the acquisition by any “person” (as such term is used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934, as amended), or two or more persons acting
in concert, of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended) of 51% or more of the outstanding shares of
voting stock of TeleTech; provided, however, that for purposes of the
foregoing, “person” excludes ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and his affiliates; provided,
further that the foregoing shall exclude any such acquisition (A) by any person made
directly from TeleTech, (B) made by TeleTech or any Subsidiary, or (C) made by an employee
benefit plan (or related trust) sponsored or maintained by TeleTech or any Subsidiary; or
(v) if, during any period of 15 consecutive calendar months commencing at any time on
or after the Grant Date, those individuals (the “Continuing Directors”) who either
(A) were directors of TeleTech on the first day of each such 15-month period, or
(B) subsequently became directors of TeleTech and whose actual election or initial
nomination for election subsequent to that date was approved by a majority of the Continuing
Directors then on the board of directors of TeleTech, cease to constitute a majority of the
board of directors of TeleTech.
(c) Other Definitions. The following terms have the meanings ascribed to them below:
(i) “Cause” has the meaning given to such term, or to the term “For Cause” or
other similar phrase, in Optionee’s Employment Agreement with TeleTech or any Subsidiary, if
any; provided, however, that if at any time Optionee’s employment with
TeleTech or any Subsidiary is not governed by an employment agreement or if such employment
agreement does not define “Cause,” then the term “Cause” shall have the meaning given to
such term in the Plan; provided, further, that, notwithstanding the
provisions of Optionee’s Employment Agreement or of the Plan, for purposes of this
Agreement, TeleTech shall have the burden to prove that Optionee’s employment was terminated
for “Cause.”
(ii) “Termination Date “ means the latest day on which Optionee is expected to
report to work and is responsible for the performance of services to or on behalf of
TeleTech or any Subsidiary, notwithstanding that Optionee may be entitled to receive
payments from TeleTech (e.g., for unused vacation or sick time, severance payments, deferred
compensation or otherwise) after such date; and
(iii) “Good Reason” means (A) any reduction in Optionee’s base salary;
provided that a reduction in Optionee’s base salary of 10% or less does not
constitute “Good Reason” if such reduction is effected in connection with a reduction in
compensation that is applicable generally to officers and senior management of TeleTech;
(B) Optionee’s responsibilities or areas of supervision within TeleTech or its Subsidiaries
are substantially reduced; or (C) Optionee’s principal office is relocated outside the
metropolitan area in which Optionee’s office was located immediately prior to the Change in
Control; provided, however, that temporary assignments made for the good of
TeleTech’s business shall not constitute such a move of office location.
4. Procedure for Exercise. Exercise of the Option or a portion thereof shall be
effected by the giving of written notice to TeleTech in accordance with the Plan and payment of the
aggregate Option Price for the number of Shares to be acquired pursuant to such exercise.
5. Payment for Shares. Payment of the Option Price (or portion thereof) may be made
by (i) cash; or (ii) certified funds; or (iii) in Shares of Common Stock having an aggregate Fair
Market Value, as determined on the date of delivery, equal to the Option Price; or (iv)
consideration received by the Company under a cashless exercise whereby
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Optionee shall deliver irrevocable instructions to a broker to promptly deliver to the Company the
amount of sale or loan proceeds necessary to pay for all Common Stock acquired through such
exercise and any tax withholding obligations resulting from such exercise; or (v) by such other
method or methods as may be permitted by the Committee in accordance with the provisions of the
Plan. No Shares shall be delivered upon exercise of the Option until full payment has been made
and all applicable withholding requirements satisfied.
6. Options Not Transferable and Subject to Certain Restrictions. The Option may not
be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent
and distribution, or pursuant to a qualified domestic relations order as defined in Section 414(p)
of the Code. During Optionee’s lifetime, the Option may be exercised only by the Optionee or by a
legally authorized representative. In the event of Optionee’s death, the Option may be exercised
by the distributee to whom Optionee’s rights under the Option shall pass by will or by the laws of
descent and distribution.
7. Acceptance of Plan. Optionee hereby accepts and agrees to be bound by all the
terms and conditions of the Plan.
8. No Right to Employment. Nothing herein contained shall confer upon Optionee any
right to continuation of employment by TeleTech or any Subsidiary, or interfere with the right of
TeleTech or any Subsidiary to terminate at any time the employment of Optionee. Nothing contained
herein shall confer any rights upon Optionee as a stockholder of TeleTech, unless and until
Optionee actually receives Shares.
9. Compliance with Securities Laws. The Option shall not be exercisable and Shares
shall not be issued pursuant to exercise of the Option unless the exercise of the Option and the
issuance and delivery of Shares pursuant thereto shall comply with all relevant provisions of law
including, without limitation, the Securities Act of 1933, as amended (the “Securities
Act”), the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which Common Stock may then be listed,
and shall be further subject to the approval of counsel for TeleTech with respect to such
compliance. If, in the opinion of counsel for TeleTech, a representation is required to be made by
Optionee in order to satisfy any of the foregoing relevant provisions of law, TeleTech may, as a
condition to the exercise of the Option, require Optionee to represent and warrant at the time of
exercise that the Shares to be delivered as a result of such exercise are being acquired solely for
investment and without any present intention to sell or distribute such Shares.
10. Adjustments. Subject to the sole discretion of the Board of Directors, TeleTech
may, with respect to any unexercised portion of the Option, make any adjustments necessary to
prevent accretion, or to protect against dilution, in the number and kind of shares covered by the
Option and in the applicable exercise price thereof in the event of a change in the corporate
structure or shares of TeleTech; provided, however, that no adjustment shall be made for the
issuance of preferred stock of TeleTech or the conversion of convertible preferred stock of
TeleTech. For purposes of this Section 10, a change in the corporate structure or shares of
TeleTech includes, without limitation, any change resulting from a recapitalization, stock split,
stock dividend, consolidation, rights offering, spin-off, reorganization or liquidation, and any
transaction in which shares of Common Stock are changed into or exchanged for a different number or
kind of shares of stock or other securities of TeleTech or another entity.
11. No Other Rights. Optionee hereby acknowledges and agrees that, except as set
forth herein, no other representations or promises, either oral or written, have been made by
TeleTech, any Subsidiary or anyone acting on their behalf with respect to Optionee’s right to
acquire any shares of Common Stock, stock options or awards under the Plan, and Optionee hereby
releases, acquits and forever discharges TeleTech, the Subsidiaries and anyone acting on their
behalf of and from all claims, demands or causes of action whatsoever relating to any such
representations or promises and waives forever any claim, demand or action against TeleTech, any
Subsidiary or anyone acting on their behalf with respect thereto.
12. Confidentiality. OPTIONEE AGREES NOT TO DISCLOSE, DIRECTLY OR INDIRECTLY, TO ANY
OTHER EMPLOYEE OF TELETECH AND TO KEEP CONFIDENTIAL ALL INFORMATION RELATING TO ANY OPTIONS OR
OTHER AWARDS GRANTED TO OPTIONEE, PURSUANT TO THE PLAN OR OTHERWISE, INCLUDING THE AMOUNT OF ANY
SUCH AWARD, THE EXERCISE PRICE AND THE RATE OF VESTING THEREOF; PROVIDED THAT OPTIONEE SHALL BE
ENTITLED TO
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DISCLOSE SUCH INFORMATION TO SUCH OF OPTIONEE’S ADVISORS, REPRESENTATIVES OR AGENTS, OR TO SUCH OF
TELETECH’S OFFICERS, ADVISORS, REPRESENTATIVES OR AGENTS (INCLUDING LEGAL AND ACCOUNTING ADVISORS),
WHO HAVE A NEED TO KNOW SUCH INFORMATION FOR LEGITIMATE TAX, FINANCIAL PLANNING OR OTHER SUCH
PURPOSES.
13. Severability. Any provision of this Agreement (or portion thereof) that is deemed
invalid, illegal or unenforceable in any jurisdiction shall, as to that jurisdiction and subject to
this Section 13, be ineffective to the extent of such invalidity, illegality or unenforceability,
without affecting in any way the remaining provisions thereof in such jurisdiction or rendering
that or any other provisions of this Agreement invalid, illegal, or unenforceable in any other
jurisdiction.
14. References. Capitalized terms not otherwise defined herein shall have the same
meaning ascribed to them in the Plan.
15. Entire Agreement. This Agreement (including the Plan, which is incorporated
herein) constitutes the entire agreement between the parties concerning the subject matter hereof
and supersedes all prior and contemporaneous agreements, oral or written, between TeleTech and
Optionee relating to Optionee’s entitlement to stock options, Common Stock or similar benefits,
under the Plan or otherwise.
16. Amendment. This Agreement may be amended and/or terminated at any time by mutual
written agreement of TeleTech and Optionee.
17. No Third Party Beneficiary. Nothing in this Agreement, expressed or implied, is
intended to confer on any person other than Optionee and Optionee’s respective successors and
assigns expressly permitted herein, any rights, remedies, obligations or liabilities under or by
reason of this Agreement.
18. Governing Law. The construction and operation of this Agreement are governed by
the laws of the State of Delaware (without regard to its conflict of laws provisions).
[SIGNATURE PAGE TO FOLLOW]
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Executed as of the date first written above.
| TELETECH HOLDINGS, INC. | ||||||
| By: | ||||||
| Name | ||||||
| Title | ||||||
| Signature of (“Optionee”) | ||||||
| Optionee’s Social Security Number | ||||||
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