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Exhibit
10.11b
Revised
Form
AMENDED AND
RESTATED
2007 EXECUTIVE OPTION
CERTIFICATE
Optionee:
This Option and any
securities issued upon exercise of this Option are subject to
restrictions on voting and transfer and requirements of sale and
other provisions as set forth in the Stockholders Agreement among
CRC Health Group, Inc. and certain investors, dated as of
February 6, 2006, as amended from time to time (the
“Stockholders Agreement”). This Option and any
securities issued upon exercise of this Option constitute
Management Shares as defined therein.
CRC HEALTH GROUP,
INC.
STOCK OPTION
CERTIFICATE
This stock option (the
“Agreement”) was granted by CRC Health Group, Inc., a
Delaware corporation (the “Company”), to the Optionee,
pursuant to the Company’s 2006 Executive Incentive Plan, as
amended from time to time (the “Plan”). For purposes of
this Agreement, the “Grant Date” shall mean
and the “Initial Vesting Date” shall mean
. This Agreement is amended and restated as of the date hereof,
September , 2007.
1. Grant of Option . This
certificate evidences the grant by the Company on the Grant Date to
the Optionee of an option to purchase (the “Option”),
in whole or in part, on the terms provided herein and in the Plan,
the following Units as set forth below.
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(a) |
[ ] Units at $
per Unit
(the “Tranche 1 Options”); |
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(b) |
[ ] Units at $
per Unit
(the “Tranche 2 Options”); and |
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(c) |
[ ] Units at $
per Unit
(the “Tranche 3 Options” and together with the Tranche
1 Options and Tranche 2 Options, the
“Options”). |
Each “Unit”
consists of 9 shares of Class A Common Stock of the Company,
par value $.001 per share, and 1 share of Class L Common Stock of
the Company, par value $.001 per share, subject to adjustment as
provided in the Plan. The Option evidenced by this certificate is
not intended to qualify as an incentive stock option under
Section 422 of the Internal Revenue Code (the
“Code”).
2. Vesting . During the
Optionee’s Employment, this Option shall vest as
follows:
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(a) |
The Tranche 1
Options will vest and become exercisable (i) with respect to
20% of the Units subject to the Tranche 1 Options on the first
anniversary of the Initial Vesting Date, (ii) with respect to
10% of the Units subject to the Tranche 1
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Options every six months
following the first anniversary of the Initial Vesting Date until
100% of the Tranche 1 Options are vested and (ii) if earlier,
with respect to 100% of the Units subject to the Tranche 1 Options,
on a Change of Control.
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(b) |
If a Tranche 2 Vesting Event occurs on a Measurement Date, then
all or a portion of the Tranche 2 Options will vest and become
exercisable such that the Tranche 2 Options will then be vested and
exercisable with respect to a number of Units equal to (i) the
Tranche 2 Maximum Percentage with respect to such Measurement Date
multiplied by (ii) the number of Units subject to the Tranche
2 Options. |
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(c) |
Prior to a Change of Control, the Tranche 3 Options will vest
and become exercisable in installments on March 31,
2008, March 31, 2009, March 31,
2010, March 31, 2011, and March 31, 2012 with
respect to a number of Units equal to (i) the Vesting
Percentage for the previous calendar year multiplied by the number
of Units subject to the Tranche 3 Options plus (ii) the
Catch-up Vesting Percentage for the previous calendar year
multiplied by the number of Units subject to the Tranche 3 Options.
In addition, on a Change of Control, unvested Tranche 3 Options
will vest with respect to a number of Units equal to the product of
(i) the Average Vesting Percentage multiplied by
(iii) the number of Undetermined Years multiplied by
(iii) the number of Units subject to the Tranche 3 Options.
Furthermore, if a Tranche 3 Vesting Event occurs on a Measurement
Date, then all Tranche 3 Options remaining unvested at such time
will vest. |
3. Exercise of Option . Each
election to exercise this Option shall be subject to the terms and
conditions of the Plan and shall be in writing, signed by the
Optionee or by his or her executor or administrator or by the
person or persons to whom this Option is transferred by will or the
applicable laws of descent and distribution (the “Legal
Representative”), and made pursuant to and in accordance with
the terms and conditions set forth in the Plan. The latest date on
which this Option may be exercised (the “Final Exercise
Date”) is the date which is the tenth (10th) anniversary
of the Grant Date, subject to earlier termination in accordance
with the terms and provisions of the Plan and this
Agreement.
4. Representations and Warranties of
Optionee .
Optionee represents and
warrants that:
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(a) |
Authorization . Optionee has full legal capacity, power,
and authority to execute and deliver this Agreement and to perform
Optionee’s obligations hereunder. This Agreement has been
duly executed and delivered by Optionee and is the legal, valid,
and binding obligation of Optionee enforceable against Optionee in
accordance with the terms hereof. |
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(b) |
No
Conflicts . The execution, delivery, and performance by
Optionee of this Agreement and the consummation by Optionee of the
transactions contemplated
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hereby will not, with or
without the giving of notice or lapse of time, or both
(i) violate any provision of law, statute, rule or regulation
to which Optionee is subject, (ii) violate any order, judgment
or decree applicable to Optionee, or (iii) conflict with, or
result in a breach of default under, any term or condition of any
agreement or other instrument to which Optionee is a party or by
which Optionee is bound.
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(c) |
No Other Agreements . Except as provided by this
Agreement, the Stockholders Agreement and the Plan, Optionee is not
a party to or subject to any agreement or arrangement with respect
to the voting or transfer of this Option or the shares of common
stock issued upon exercise hereof. |
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(d) |
Thorough Review, etc. Optionee has thoroughly reviewed
the Plan and this Agreement in their entirety. Optionee has had an
opportunity to obtain the advice of counsel (other than counsel to
the Company or its Affiliates) prior to executing this Agreement,
and fully understands all provisions of the Plan and this
Agreement. |
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(e) |
Investment Intent . The Optionee is acquiring the Units
solely for the Optionee’s own account for investment and not
with a view to or for sale in connection with any distribution of
the Units or any portion thereof and not with any present intention
of selling, offering to sell or otherwise disposing of or
distributing the Units or any portion thereof in any transaction
other than a transaction exempt from registration under the
Securities Act. The Optionee further represents that the entire
legal and beneficial interest of the Units is being acquired, and
will be held, for the account of the Optionee only and neither in
whole nor in part for any other person. |
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(f) |
Absence of Solicitation . The Optionee was not presented
with or solicited by any form of general solicitation or general
advertising, including, but not limited to, any advertisement,
article, notice, or other communication published in any newspaper,
magazine, or similar media, or broadcast over television, radio or
similar communications media, or presented at any seminar or
meeting whose attendees have been invited by any general
solicitation or general advertising. |
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(g) |
Residence . The Optionee’s principal residence is
located at the address indicated beneath the Optionee’s
signature below. |
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(h) |
Information Concerning the Company . The Optionee is
aware of the Company’s business affairs and financial
condition and has acquired sufficient information about the Company
to reach an informed and knowledgeable decision to acquire the
Units. The Optionee further represents and warrants that the
Optionee has discussed the Company and its plans, operations and
financial condition with its officers, has received all such
information as the Optionee deems necessary and appropriate to
enable the Optionee to evaluate the financial risk inherent in
acquiring the Units and has received satisfactory and complete
information concerning the business and financial condition of the
Company in response to all inquiries in respect
thereof. |
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(i) |
Capacity to Protect Interests . The Optionee has either
(i) a preexisting personal or business relationship with the
Company or any of its officers, directors, or controlling persons,
consisting of personal or business contacts of a nature and
duration to enable the Optionee to be aware of the character,
business acumen and general business and financial circumstances of
the person with whom such relationship exists, or (ii) such
knowledge and experience in financial and business matters as to
make the Optionee capable of evaluating the merits and risks of an
investment in the Stock and to protect the Optionee’s own
interests in the transaction, or (iii) both such relationship
and such knowledge and experience. |
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(j) |
Reliance by the Company . The Optionee understands that
the Option and any Units acquired upon exercise of the Option have
not been qualified under the Corporate Securities Law of 1968, as
amended, of the State of California by reason of a specific
exemption therefrom, which exemption depends upon, among other
things, the bona fide nature of the Optionee’s
representations as expressed herein. The Optionee understands that
the Company is relying on the Optionee’s representations and
war |
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