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Exhibit
10.2
CORINTHIAN COLLEGES,
INC.
2003 PERFORMANCE AWARD
PLAN
NONQUALIFIED STOCK OPTION
AGREEMENT
THIS NONQUALIFIED STOCK
OPTION AGREEMENT (this “ Option Agreement ”)
by and between CORINTHIAN COLLEGES, INC. , a Delaware
corporation (the “ Corporation ”), and Jack D.
Massimino (the “ Participant ”) evidences the
stock option (the “ Option ”) granted by the
Corporation to the Participant as to the number of shares of the
Corporation’s Common Stock first set forth below.
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| Number
of Shares of Common Stock: 1 |
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[Insert
total number of options] |
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Award
Date: , 2007 |
| Exercise Price per Share: 1 |
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$
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Expiration Date: 1,2 , 2014 |
Vesting
1,2
Up to [Insert 50% of options]
shares of Common Stock subject to the Option shall vest as set
forth below if certain Corporation revenue related performance
criteria are met (the “Revenue Related Shares”), and up
to [Insert 50% of options] shares of Common Stock subject to the
Option shall vest as set forth below if certain Corporation
operating profit performance criteria are met (the “Operating
Profit Related Shares”).
The Participant shall not
vest in any portion of the Revenue Related Shares if Net Revenue
for the Corporation’s fiscal year ending June 30, 2010
is less than
$
(the “Minimum Revenue Target”). The Participant shall
vest in 50% of the [Insert 50% of options] Revenue Related Shares
if Net Revenue for the Corporation’s fiscal year ending
June 30, 2010 or any prior fiscal year equals or exceeds the
Minimum Revenue Target. The Participant shall vest in all [Insert
50% of options] Revenue Related Shares if Net Revenue for the
Corporation’s fiscal year ending June 30, 2010 is equal
to or exceeds
$
(the “Maximum Revenue Target”). If Net Revenue for the
Corporation’s fiscal year ending June 30, 2010 exceeds
the Minimum Revenue Target, but is less than Maximum Revenue
Target, then the Participant shall vest in an amount of Revenue
Related Shares equal to the following formula: [Insert 25% of
options] Revenue Related Shares plus ([Insert 25% of options]
Revenue Related Shares multiplied by a fraction, the numerator of
which is the Corporation’s Net Revenue for the fiscal year
ending June 30, 2010 minus the Minimum Revenue Target, and the
denominator of which is the Maximum Revenue Target minus the
Minimum Revenue Target).
The Participant shall not
vest in any portion of the Operating Profit Related Shares if
Operating Profit for the Corporation’s fiscal year ending
June 30, 2010 is less than
$
(the “Minimum Profit Target”). The Participant shall
vest in 50% of the [Insert 50% of options] Operating Profit Related
Shares if Operating Profit for the Corporation’s fiscal year
ending June 30, 2010 or any prior fiscal year equals or
exceeds the Minimum Profit Target. The Participant shall vest in
all [Insert 50% of options] Operating Profit Related Shares if
Operating Profit for the Corporation’s fiscal year ending
June 30, 2010 is equal to or exceeds
$
(the “Maximum Profit Target”). If Operating Profit for
the Corporation’s fiscal year ending June 30, 2010
exceeds the Minimum Profit Target, but is less than the Maximum
Profit Target, then the Participant shall vest in an amount of
Operating Profit Related Shares equal to the following formula:
[Insert 25% of options] Operating Profit Related Shares plus
([Insert 25% of options] Operating Profit Related Shares multiplied
by a fraction, the numerator of which is the Corporation’s
Operating Profit for the fiscal year ending June 30, 2010
minus the Minimum Profit Target, and the denominator of which is
the Maximum Profit Target minus the Minimum Profit
Target).
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1
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Subject to adjustment under Section 6.3 of the
Plan.
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2
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Subject to earlier termination as provided in Section 4 of
the Terms.
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If the above targets are met,
the Participant shall vest in the applicable number of Revenue
Related Shares and/or Operating Profit Related Shares on the
Certification Date (defined below). Despite the foregoing, the
Participant shall not vest in the number of Revenue Related Shares
and/or Operating Profit Related Shares determined above unless he:
(i) is the Chief Executive Officer of the Corporation on
June 30, 2009; and (ii) (A) serves as a member of
the Board of the Corporation or any of its Subsidiaries on
June 30, 2010; (B) dies while serving as a member of the
Board of the Corporation or any of its Subsidiaries after
June 30, 2009, but prior to June 30, 2010; or
(C) becomes Totally Disabled while serving as a member of the
Board of the Corporation or any of its Subsidiaries after
June 30, 2009, but prior to June 30, 2010 and is in good
standing with the Corporation on June 30, 2010.
The determination of Net
Revenue, Operating Profit, and whether performance criteria have
been achieved shall be determined on the basis of the audited
financial statements of the Corporation for the fiscal year ending
June 30, 2010, and the Corporation’s Compensation
Committee shall certify such achievement in writing following a
duly-called meeting (the “Certification Date”). The
terms “Net Revenue” and “Operating Profit”
are used as applied under generally accepted accounting principles
or in the Corporation’s financial reporting.
The Option is granted under
the Corinthian Colleges, Inc. 2003 Performance Award Plan (the
“ Plan ”) and subject to the Terms and
Conditions of Management Nonqualified Stock Option (the “
Terms ”) attached to this Option Agreement
(incorporated herein by this reference) and to the Plan. The Option
has been granted to the Participant in addition to, and not in lieu
of, any other form of compensation otherwise payable or to be paid
to the Participant. Capitalized terms are defined in the Plan if
not defined herein. The parties agree to the terms of the Option
set forth herein. The Participant acknowledges receipt of a copy of
the Terms and the Plan.
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| “PARTICIPANT” |
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CORINTHIAN COLLEGES, INC., |
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a Delaware corporation |
| Signature |
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By: |
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Name |
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Name: |
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Stan A.
Mortensen |
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Its: |
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Sr. Vice
President and General Counsel |
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TERMS AND CONDITIONS OF
MANAGEMENT NONQUALIFIED STOCK OPTION
| 1. |
Vesting; Limits on Exercise . |
As set forth on the first two
pages of this Option Agreement, the Option shall vest and become
exercisable in the aggregate number of shares of Common Stock
subject to the Option determined as set forth on such first two
pages. The Option may be exercised only to the extent the Option is
vested and exercisable.
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Cumulative
Exercisability . To the extent that the Option is vested and
exercisable, the Participant has the right to exercise the Option
(to the extent not previously exercised), and such right shall
continue until the expiration or earlier termination of the
Option.
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No
Fractional Shares . Fractional share interests shall be
disregarded, but may be cumulated.
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Minimum Exercise . No
fewer than 100 1 shares of Common Stock may be purchased at any one time, unless
the number purchased is the total number at the time exercisable
under the Option.
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Nonqualified Stock Option Status . The Option is a
nonqualified stock option and is not, and shall not be, an
incentive stock option within the meaning of Section 422 of
the Code.
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| 2. |
Continuance of Employment/Service Required; No
Employment/Service Commitment . |
Except as expressly provided
on the fist two pages of this Option Agreement and Section 4
below, the vesting provisions require continued employment or
service as a member of the Board through the vesting date as a
condition to the vesting of the Option and the rights and benefits
under this Option Agreement. Employment or service as a member of
the Board for only a portion of the vesting period, even if a
substantial portion, will not entitle the Participant to any
proportionate vesting or avoid or mitigate a termination of rights
and benefits upon or following a termination of employment or
services as a member of the Board as provided in Section 4
below or under the Plan. Employment or service as a member of the
Board of the Corporation or any of its Subsidiaries after
June 30, 2010 is not required in order to vest in the Option
on the Certification Date.
Nothing contained in this
Option Agreement or the Plan constitutes an employment or Board
service commitment by the Corporation or any of its Subsidiaries,
affects the Participant
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