Exhibit 10.1
NONQUALIFIED STOCK OPTION AGREEMENT
This NONQUALIFIED STOCK OPTION
AGREEMENT (the “ Agreement ”) is made as of
August 7, 2007 (the “ Grant Date ”) by and
between ASSET ACCEPTANCE CAPITAL CORP., a Delaware corporation (the
“ Corporation ”), and
(the “ Optionee ”).
Recitals
A. Capitalized terms used and
not defined herein have the meanings ascribed to them in the
Corporation’s 2004 Stock Incentive Plan, as amended and
restated May 22, 2007 (the “ Plan ”), a
copy of which is attached hereto as Annex A .
B. The terms of the Plan are
summarized in its prospectus, a copy of which is attached hereto as
Annex B . The Plan shall control over the prospectus in the
event of any conflict or inconsistency among them.
C. The Optionee serves as an
Employee of the Corporation or a Subsidiary of the Corporation and
has been duly granted the Option (as defined below) in an effort
to, among other things, provide additional incentive to the
Optionee in connection with his employment and to align the
Optionee’s interests with the Corporation’s long-term
best interests.
Agreement
NOW, THEREFORE, in consideration of
the premises and the mutual promises and agreements hereinafter set
forth, the parties hereto agree as follows:
1. Grant of Option .
Subject to the terms and conditions hereof, the Corporation hereby
grants, effective as of the Grant Date, to the Optionee the right
and option to purchase from the Corporation up to, but not
exceeding in the aggregate,
shares of the Corporation’s Common Stock at a price of $
per share (being the closing price on the Grant Date) (the “
Option ”). The Option being granted pursuant to this
Agreement does not meet the requirements of Section 422
of the Internal Revenue Code of 1986, as amended (the “
Code ”), and, therefore, is intended to constitute a
Nonqualified Stock Option.
2. Right to Exercise Option,
and Term . The Option may not be exercised prior to
August 7, 2008. Thereafter, the Option shall become
exercisable in installments as follows:
(a) 25%
of the shares covered by the Option shall become exercisable on or
after August 7, 2008;
(b) An
additional 25% (50% cumulative) of the shares covered by the Option
shall become exercisable on or after August 7, 2009;
(c) An
additional 25% (75% cumulative) of the shares covered by the Option
shall become exercisable on or after August 7, 2010;
(d) An
additional 25% (100% cumulative) of the shares covered by the
Option shall become exercisable on or after August 7, 2011;
and
To the
extent not exercised, installments shall accumulate and may be
exercised by the Optionee, in whole or in part, in any subsequent
period. The Board, in its sole discretion, may accelerate the time
at which any option may be exercised in whole or in part.
Notwithstanding any other provision of this Agreement, this Option
shall not be exercisable after the tenth (10th) anniversary of the
Grant Date.
3. Exercise of Option
.
(a)
Conditions Precedent . The Optionee, from time to time
during the period when the Option hereby granted may by its terms
be exercised, may exercise the Option in whole or in part as at the
time permitted, by satisfaction of the following conditions:
(i)
Notice . By delivery to the Corporation of a written notice
signed by the Optionee, in substantially the form attached hereto
as Annex C , stating the number of shares that the Optionee
has elected to purchase at that time from the Corporation and
representing that the Optionee is acquiring the shares being
purchased for investment and not for resale; provided, however,
that this representation shall not be binding upon the Optionee
if the shares of Common Stock that being purchased are subject to
an effective registration statement under the Securities Act of
1933.
(ii)
Payment . By delivery to the Corporation of
(A)
The purchase price for shares of Common Stock to be acquired upon
exercise of the Option shall be paid in full in cash or by personal
check, bank draft or money order at the time of exercise.
(B)
In lieu of the form of payment described above in subsection
(A) , the Optionee may pay such purchase price in whole or in
part either by surrendering shares of Common Stock that are subject
to this Option or by tendering shares of Common Stock, which have
been held by the Optionee for at least six (6) months and
which are freely owned and held by the Optionee independent of any
restrictions, hypothecations or other encumbrances, duly endorsed
for transfer (or with duly executed stock powers attached), or in
any combination of the above. Shares of Common Stock surrendered
upon exercise shall be valued at the Stock Exchange closing price
for the Corporation’s Common Stock on the day prior to
exercise, as reported in The Wall Street Journal (or as
otherwise reported by such Stock Exchange), and the
certificate(s)
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for such
shares, duly endorsed for transfer or accompanied by appropriate
stock powers, shall be surrendered to the Corporation. If the
Optionee is subject to short swing profit restrictions under the
Exchange Act and desires to exercise the Option by tendering
previously-acquired shares, then he or she shall do so only in
accordance with the provisions of Rule 16b-3 of the Exchange
Act.
(b)
Issuance of Shares . After satisfaction of the conditions
described above in Section 3(a) , the Corporation shall
issue the shares in the name of the Optionee and deliver the
certificates therefor to the Optionee.
4. Termination of
Employment . As provided in Section 7.1 of the
Plan, the general terms and conditions of exercise of the Option
shall be subject to the following:
(a) If,
prior to the date that the Option first becomes Vested, the
Optionee terminates employment for any reason (other than after a
Change in Control), the Optionee’s right to exercise the
Option shall terminate and all rights thereunder shall cease.
(b) If,
on or after the date that the Option first becomes Vested, the
Optionee terminates employment for any reason, other than death or
Disability, the Optionee shall have the right, within the earlier
of (i) the expiration of the Option, and (ii) three
(3) months after termination of his employment, to exercise
the Option to the extent that it was exercisable and unexercised on
the date of the Optionee’s termination of employment, subject
to any other limitation on the exercise of the Option in effect on
the date of exercise.
(c) If,
on or after the date that the Option first becomes Vested, the
Optionee terminates employment due to death while an Option is
still exercisable, the person or persons to whom the Option shall
have been transferred by will or by the laws of descent and
distribution, shall have the right within the earlier of
(i) the expiration of the Option, and (ii) three
(3) months after the death of the Optionee, to exercise the
Option to the extent that it was exercisable and unexercised on the
Optionee’s date of death, subject to any other limitation on
exercise in effect on the date of exercise.
(d) If,
on or after the date that the Option first becomes Vested, the
Optionee terminates employment due to Disability, the Optionee
shall have the right, within the earlier of (i) the expiration
of the Option, and (ii) three (3) months after the
effective date of the termination of employment, to exercise the
Option to the extent that it was exercisable and unexercised on the
date of the Optionee’s termination of employment, subject to
any other limitation on the exercise of the Option in effect on the
date of exercise. If the Optionee dies after termination of his
employment while the Option is still exercisable, the Option shall
be exercisable in accordance with the terms of
Section 4(c) above.
(e) The
Committee, at the time of the termination of the Optionee’s
term of employment, may, in its sole discretion, accelerate the
Optionee’s right to exercise the Option or extend the
exercise period of the Option.
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(f) Shares
subject to the Option that are not exercised in accordance with the
provisions of Section 4(a) through (e) above shall
expire and be forfeited by the Optionee as of their expiration date
and shall become available for new grants and awards under the Plan
as of such date.
5. Change in Control .
Notwithstanding anything contained herein to the contrary, in the
event of an Optionee’s Change in Position subsequent to a
Change in Control, the Option granted to the Optionee immediately
shall become fully Vested and exercisable in full, regardless of
any installment provision applicable to the Option.
6. Effect on Term on
Employment . None of the adoption of the Plan, the granting of
the Option or the execution and delivery of this Agreement shall be
deemed to create or confer on the Optionee any right to be retained
or to continue as an Employee or interferes in any way with the
right of the Corporation to terminate the Optionee’s
employment at any time.
7. Adjustments .
(a) The
total number of shares of Common Stock subject to the grant of the
Option (both as to the number of shares of Common Stock and the
purchase price per share), shall be adjusted pro rata in
accordance with Section 8.1(a) of the Plan. The foregoing
adjustments shall be made by the Board, whose determination in that
respect shall be final, binding and conclusive.
(b) In
the event of a proposed dissolution or liquidation of the
Corporation, the Committee shall notify the Optionee as soon as
practicable prior to the effective date of such proposed
transaction. The Committee in its discretion may provide for the
Optionee to have the right to exercise the Option in full until ten
(10) days prior to such transaction as to all of the shares of
Common Stock covered thereby, including shares as to which the
Option would not otherwise be exercisable. In addition, the
Committee may provide that any re-purchase option of the
Corporation applicable to the shares purchased upon exercise of the
Option shall lapse as to all such shares, provided that the
proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously
exercised, the Option shall terminate immediately prior to the
consummation of the proposed dissolution or liquidation.
(c) In
the event of a merger of the Corporation with or into another
corporation, the sale of substantially all of the assets of the
Corporation, or the reorganization or consolidation of the
Corporation, each outstanding Option shall be assumed or an
equivalent option or right substituted by the successor corporation
or the parent or a subsidiary of the successor corporation. In the
event that such successor corporation (or the parent or a
subsidiary thereof) refuses to assume or substitute for the Option,
the Optionee shall fully vest in and have the right to exercise the
Option in full, including shares which would not otherwise be
vested or exercisable. If an Option becomes fully vested and
exercisable in lieu of assumption or substitution in the event of a
merger or sale of assets, the Committee shall notify the Optionee
in writing or electronically that the Option shall be fully vested
and exercisable for a period of fifteen (15) days from the
date of such notice, and the Option shall terminate upon the
expiration of such period. For the purposes of this
Section 7(c) , the Option shall be considered assumed
if,
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following the merger, sale of assets, reorganization or
consolidation, the option or right confers the right to purchase or
receive, for each share covered by the Optionee&rsq
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