Document:

EXHIBIT 10.20

 

TETRA TECH, INC.

 

2003 Outside Director Stock Option Plan

 

1.                                       Purpose.

 

The purpose of the Tetra Tech,
Inc. 2003 Outside Director Stock Option Plan (the “Plan”) is to attract and
retain the services of experienced and knowledgeable independent directors of
Tetra Tech, Inc. (the “Company”) for the benefit of the Company and its
stockholders, and to provide an additional incentive for such directors to
continue to work for the best interests of the Company and its stockholders
through continuing ownership of its Common Stock.

 

2.                                       Definitions.

 

Unless the
context clearly indicates otherwise, the following terms, when used in this
Plan, shall have the meanings set forth in this Section 2.

 

(a)                                  “Annual
Grant” shall have the meaning specified in Section 6.

 

(b)                                 “Appointment
Grant” shall have the meaning specified in Section 6.

 

(c)                                  “Board
of Directors” shall mean the Board of Directors of the Company.

 

(d)                                 “Common
Stock” shall mean the Common Stock, $.01 par value, of the Company or such
other class of shares or other securities as may be applicable pursuant to the
provisions of Section 5.

 

(e)                                  “Company”
shall mean Tetra Tech, Inc.

 

(f)                                    “Disabled”
shall mean an Outside Director’s inability to perform the duties of a director
of the Company by reason of a mental or physical impairment.  The following shall constitute conclusive
proof that an Outside Director is disabled:

 

(i)                                     The
appointment by a court of competent jurisdiction of a guardian or conservator
of the person or estate of an Outside Director; or

 

(ii)                                  An
Outside Director’s failure to attend any meetings of the Board during a period
of six months by reason of illness or physical injury, as determined by the
Board of Directors.

 

(g)                                 “Fair
Market Value” shall mean the closing price of the Common Stock as reported in
the composite transactions report of the national securities exchange on which
the Common Stock is then listed (the “Exchange”).  If such day is a day that the Exchange is not open, then the Fair
Market Value shall be determined by reference to the closing price of the
Common Stock for the immediately preceding trading day.  If at any time the Common Stock is not
listed on a national securities exchange, then if the Common Stock is actively
traded over-

 

 

the-counter, the fair market
value shall be deemed to be the volume weighted daily average of the closing
bid and asked prices at the end of regular trading hours quoted on the Nasdaq
Stock Market (or similar system) over the ten (10) trading day period ending
the trading day before the day the Fair Market Value of the Common Stock is
being determined.  If at any time the
Common Stock is not listed on a national securities exchange or actively traded
on the Nasdaq Stock Market (or similar system), the Fair Market Value of the
Common Stock shall be the highest price per share the Company could obtain from
a willing buyer (not a current employee or director) for a substantially
equivalent number of shares of Common Stock sold by the Company, from
authorized but unissued shares, as determined in good faith by its Board of
Directors, unless the Company shall become subject to a merger, acquisition or
other consolidation pursuant to which the Company is not the surviving party,
in which case the Fair Market Value of Common Stock shall be deemed to be the
value received by the holders of the Common Stock on a Common Stock equivalent
basis pursuant to such merger or acquisition.

 

(h)                                 “1934
Act” shall mean the Securities Exchange Act of 1934, as amended.

 

(i)                                     “Option”
shall mean an Option granted pursuant to this Plan.

 

(j)                                     “Option
Agreement” shall have the meaning specified in Section 7.

 

(k)                                  “Outside
Director” shall have the meaning given the term “Non-Employee Director” by Rule
16b-3 adopted under the 1934 Act.

 

(l)                                     “Plan”
shall mean this Tetra Tech, Inc. 2003 Outside Director Stock Option Plan as set
forth herein, as the same may be amended from time to time.

 

(m)                               “Retirement”
shall mean resignation from or replacement on the Board of Directors after an
Outside Director has attained the age of 75 years with a minimum of five years
of service on the Board of Directors.

 

(n)                                 “Tax
Date” shall mean the date as of which any federal, state, local or foreign tax
is required to be withheld from an Outside Director in connection with the
exercise of an Option, or the sale or other disposition of Common Stock
acquired upon the exercise of an Option.

 

3.                                       Shares of Common Stock Subject to the Plan.

 

(a)                                  Subject
to the provisions of Section 5, the aggregate number of shares of Common
Stock upon which Options may be granted under the Plan shall not exceed
[400,000] shares.

 

(b)                                 The
shares to be delivered under the Plan shall be made available, at the
discretion of the Board of Directors, from either authorized but unissued
shares of Common Stock or previously issued shares reacquired by the Company,
including shares purchased in the open market.

 

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(c)                                  If
any outstanding Option granted under the Plan expires, lapses, is terminated or
is forfeited for any reason, then the unissued shares of Common Stock that were
allocable to the unexercised portion of such Option shall again be available
for issuance upon exercise of an Option granted under this Plan.

 

4.                                       Administration of the Plan.

 

(a)                                  The
Plan shall be administered by the Board of Directors.  The Board of Directors may authorize any officer or officers of
the Company to execute and deliver Option Agreements and other documents on
behalf of the Company.

 

(b)                                 Subject
to the provisions of the Plan, the Board of Directors is authorized and
directed to interpret the Plan, to establish, amend and rescind policies
relating to the Plan, to direct the Company to execute agreements and
amendments thereto setting forth the terms and conditions of grants of Options
under the Plan and to make such other determinations and to take such other
actions as are consistent with the Plan and are necessary or appropriate for
the administration of the Plan. 
Notwithstanding the foregoing, the Board of Directors shall not have the
authority to make any determination, to adopt any policy or to take any action
that would cause grants and exercises under the Plan to cease to be exempt from
Section 16(b) of the 1934 Act by virtue of Rule 16b-3, or any successor rule,
thereunder.

 

(c)                                  Any
determination, decision or action of the Board of Directors in connection with
the construction, interpretation, administration or application of the Plan
shall be final, binding and conclusive upon all Plan participants and their
transferees, beneficiaries, legal representatives, executors and other
successors and assigns and upon all other persons. No member of the Board of
Directors, and no other person acting upon the authorization and direction of
the Board of Directors, shall be liable for any determination, decision or
action made in good faith with respect to the Plan.

 

(d)                                 The
Company shall indemnify and hold harmless the members of the Board of
Directors, and other persons who are acting upon the authorization and
direction of the Board of Directors, from and against any and all liabilities,
costs and expenses incurred by such persons as a result of any act or omission
in connection with the performance of such persons’ duties, responsibilities
and obligations under the Plan, other than such liabilities, costs and expenses
as may result from the bad faith, willful misconduct or criminal acts of such
persons.

 

5.                                       Adjustment Provisions.

 

(a)                                  Subject
to the provisions of Section 5(b), if the outstanding shares of Common
Stock of the Company are subdivided, combined or exchanged for a different
number or kind of shares or other securities, or if additional shares or new or
different shares or other securities are distributed in respect of such shares
of Common Stock or other securities, through merger, consolidation, sale of all
or substantially all of the property of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split or other distribution in respect of such shares of Common Stock or other
securities, there shall be an appropriate and proportionate adjustment in each
of the following:  (i) the maximum
number and

 

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kind of securities provided in Section
3(a) of this Plan, (ii) the number and kind of shares or other securities
subject to then outstanding Options, and (iii) the price for each share subject
to such outstanding Options, but without change in the aggregate purchase price
as to which such Options remain exercisable.

 

(b)                                 Upon
the dissolution or liquidation of the Company or upon a reorganization, merger
or consolidation of the Company with one or more companies as a result of which
the Company is not the surviving company, or upon the sale of all or
substantially all the assets of the Company, all Options then outstanding under
the Plan shall be fully vested and exercisable unless provisions are made in
connection with such transaction for the continuation of this Plan and the
assumption of or substitution for such Options of new Options covering the
stock of a successor company, or a parent or subsidiary thereof, with
appropriate adjustments as to the number and kind of shares and prices.

 

(c)                                  The
adjustment provisions of this Section 5 shall not apply to the number of
shares granted pursuant to an Appointment Grant or Annual Grant in accordance
with Section 6.

 

(d)                                 Adjustments
under this Section 5 shall be approved by the Board of Directors, whose
determination as to what adjustments shall be made, and the extent thereof,
shall be final, binding and conclusive. 
No fractional interests shall be issued under the Plan on account of any
such adjustment.

 

6.                                       Grants of Options to Outside Directors.

 

All Outside
Directors shall receive Options pursuant to this Plan, as follows:

 

(a)                                  All
Outside Directors who first become Directors after the adoption of this Plan by
the Board of Directors shall receive an Option to purchase 2,500 shares of
Common Stock (an “Appointment Grant”) on the first day of the month following
the date upon which they are elected to the Board of Directors.

 

(b)                                 All
Outside Directors during their continuing service as Outside Directors during
their continuing service as Outside Directors shall also receive annually on
each first day of March following their receipt of their Appointment Grant (or,
if they were Outside Directors at the time of adoption of this Plan by the
Board of Directors, on each first day of March following the adoption of this
Plan) an Option to purchase 8,000 shares of Common Stock (an “Annual Grant”).

 

(c)                                  All
Options are intended to be non-qualified (non-statutory) stock options.

 

(d)                                 An
Outside Director may, by giving written notice to the Company not less than
thirty (30) days prior to the date on which an Option shall be due to be
granted:

 

(i)                                     decline
to accept further grants of Options under this Plan; or

 

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(ii)                                  revoke
a previous election to decline to accept further grants of Options under this
Plan, in which case such Outside Director shall thereafter receive Annual
Grants made after such revocation.

 

An Outside
Director who declines to accept grants of Options under this Plan may not
receive anything of value in lieu of such grant, either at the time of such
election or at any time thereafter.

 

7.                                       Terms of Outside Director Options.

 

(a)                                  Option Agreement.  Each Option shall be evidenced by a written agreement containing
such terms and conditions, not inconsistent with this Plan, as the Board of
Directors deems appropriate (an “Option Agreement”).  An Option Agreement shall not be effective unless and until it
has been executed by a duly authorized officer of the Company and by the
Outside Director to whom the Option is being granted.

 

(b)                                 Option Price.  The price of the shares of Common Stock subject to each Outside
Director Option shall be the Fair Market Value on the date such Option is
granted.

 

(c)                                  Exercisability.

 

(i)                                     Each
Option shall become fully exercisable on the first anniversary of the date of
grant if the director has not ceased to be a director of the Company prior to
such anniversary date;

 

(ii)                                  Upon
the death or disability of an Outside Director while in office, all Options
held by such director shall vest and become fully exercisable; and

 

(iii)                               No
Option that has not become exercisable on the date on which the holder thereof
ceases to be a director of the Company for any reason other than the death or
disability of the holder shall thereafter become exercisable by such holder or
such holder’s successors and assigns.

 

8.                                       Expiration of Options.

 

An Option may
not be exercised after the first to occur of the following events:

 

(a)                                  Except
in the case of an Outside Director who dies or is Disabled, the expiration of
three months from the date of the Outside Director’s cessation of services as a
Director unless the Outside Director dies within said three-month period, in
which case the expiration of one year from the date of death;

 

(b)                                 In
the case of the death of an Outside Director while in office, upon the
expiration of the terms stated in the Option Agreements held by such director
at the time of death; or

 

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(c)                                  In
the case of an Outside Director who is Disabled, upon the expiration of the
terms stated in the Option Agreements held by such director at the time of the
disability; or

 

(d)                                 In
the case of the Retirement of an Outside Director, the expiration of the terms
stated in the Option Agreements held by such director at the time of
retirement.

 

An Option may
not be exercised to any extent by anyone after the expiration of ten years from
the date the Option was granted.

 

9.                                       Exercise of Options.

 

(a)                                  Following
the death or disability of an Outside Director, any exercisable Option may,
prior to the time when such Option becomes unexercisable under the provisions
of Section 8 be exercised by the Outside Director’s personal
representative or by any person empowered to do so under court order, or by
will or the laws of descent and distribution, unless otherwise determined by
the Board of Directors.

 

(b)                                 An
Option may be exercised solely by delivery to the Company of all of the
following prior to the time when such Option becomes unexercisable under Section
8:

 

(i)                                     notice
in writing signed by the Outside Director or other person then entitled to
exercise such Option, stating that such Option is exercised;

 

(ii)                                  either:

 

(1)                                  full
payment (in cash or by check) for the shares with respect to which such Option
is thereby exercised; or

 

(2)                                  upon
conditions established by the Board of Directors, by the delivery or
constructive exchange of shares of Common Stock owned by the Outside Director
for such period of time as may be established by the Board of Directors, such
shares having a Fair Market Value equal to the aggregate exercise price of the
Option being exercised; or

 

(3)                                  any
combination of the consideration provided in the foregoing Subsections (1)
and (2);

 

(iii)                               in
the event the Option is being exercised by any person or persons other than the
Outside Director to whom it was originally granted, appropriate proof,
reasonably satisfactory to the Company, of the authority of such person or
persons to exercise the Option; and

 

(iv)                              if
income tax withholding on the exercise of an Option is permitted or required,
then all or any portion of any federal, state, local or foreign taxes required
to be withheld from an Outside Director with respect to the exercise of such
Option may be satisfied by the Outside Director’s instructing the Company to
withhold from the shares of Common Stock

 

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that would otherwise be
delivered upon exercise of such Option shares of Common Stock with a Fair
Market Value on the Tax Date equal to the amount of withholding taxes so to be
satisfied.

 

(v)                                 The
foregoing means of satisfying an Outside Director’s obligation to pay
withholding taxes are subject to the following additional rules and
restrictions:

 

(1)                                  in
no event may the amount of withholding taxes to be satisfied exceed the
withholding taxes payable by the Outside Director with respect to the Option
exercise, computed at the maximum withholding rates applicable to such Outside
Director at the time of such election, unless otherwise determined by the Board
of Directors; and

 

(2)                                  each
election to use Common Stock to satisfy a withholding tax obligation must
either (A) be in a written instrument signed by the Outside Director and
stating the number of shares to be withheld or surrendered or a formula
pursuant to which such number may be determined and be irrevocable; or (B)
otherwise be made in compliance with the Rules and Regulations of the
Securities and Exchange Commission under the 1934 Act relating to such
elections, as from time to time in effect.

 

In no event
shall the Company be required to issue fractional shares, and an Option may not
be exercised for fewer than 100 shares.

 

(c)                                  A
holder of an Option shall not be, and shall not have any of the rights or
privileges of, a stockholder of the Company with respect to any shares of
Common Stock purchasable upon the exercise of such Option unless and until such
Option shall have been exercised and a certificate or certificates evidencing
such shares shall have been issued by the Company to such holder.

 

(d)                                 The
Company shall not be required to issue or deliver any certificate or certificates
for shares of stock purchased upon the exercise of any Option unless and until
all legal requirements applicable to such issuance or delivery have, in the
opinion of counsel to the Company, been complied with.  In connection with any such issuance or transfer,
the person acquiring the shares shall, if requested by the Company, give
assurances satisfactory to such counsel in respect of such matters as such
counsel may deem desirable to assure compliance with all applicable legal
requirements.

 

10.                                 Restrictions on Transferability.

 

(a)                                  No
Option or interest or right therein or part thereof shall be subject to or
liable for the debts, contracts or engagements of the Outside Director or the
Outside Director’s successors in interest, as the case may be, or shall be
subject to disposition by transfer, alienation, anticipation, pledge,
encumbrance, assignment or any other means whether such disposition be
voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy),
and any attempted disposition thereof shall be null and void and of no effect; provided,
however, that nothing in this Section 10 shall prevent transfers
permitted by Section 9(a) or Section 10(b).

 

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(b)                                 Except
as otherwise provided by the Board of Directors:

 

(i)                                     Options
granted or awarded pursuant to the Plan shall not be transferable other than by
will or by the laws of descent and distribution; and

 

(ii)                                  during
the lifetime of an Outside Director, an Option shall be exercisable only by the
Outside Director personally, or by the Outside Director’s legal representative.

 

11.                                 Effective Date of the Plan.

 

This Plan is
conditional upon the approval of the stockholders of the Company, and the Plan
shall be null and void if the stockholders do not approve it within twelve (12)
months of its approval by the Board of Directors.

 

12.                                 Amendment, Suspension and Termination of Plan.

 

Except as
provided in this Section 12, the Board of Directors may amend or
terminate the Plan at any time and in any respect.

 

(a)                                  No
amendment of the Plan shall become effective without the approval of the
Company’s stockholders if such approval is required in order to comply with
Rule 16b-3 under the Exchange Act or any other applicable law, rule or
regulation.

 

(b)                                 Unless
required by applicable law, rule or regulation, no amendment or termination of
the Plan shall affect in a material and adverse manner any Option granted prior
to the date of such amendment or termination without the written consent of the
Outside Director holding such affected Option.

 

(c)                                  This
Plan is intended to comply with all requirements for the exemption from Section
16(b) of the 1934 Act applicable to Outside Directors provided by Rule 16-3 or
its successors under the 1934 Act.  To
the extent any provision of the Plan does not so comply and cannot for any
reason be amended by the Board of Directors or the stockholders of the Company
so as to comply, the provision shall, to the extent permitted by law and deemed
advisable by the Board of Directors, be deemed null and void with respect to
the holder of Options granted under this Plan.

 

13.                                 Governing Law.

 

This Plan
shall be governed by, and construed and enforced in accordance with, the laws
of the State of Delaware without giving effect to its choice of law rules.

 

14.                                 Termination of the Plan.

 

Unless
previously terminated by the Board of Directors, the Plan shall terminate when
there are no longer any Options outstanding.

 

8EXHIBIT 10.21

 

Tetra Tech, Inc.
2003 Outside Director Stock Option Plan

 

Stock Option Agreement

This Stock Option Agreement is
dated as of                    ,
2003 by and between Tetra Tech, Inc., a Delaware corporation (the “Company”)
and                                     
(the “Optionee”) pursuant to the Company’s 2003 Outside Director Stock Option
Plan (the “Plan”).  Capitalized terms
that are used but not defined in this Agreement shall have the meaning set
forth in the Plan.

 

1.                                      Grant
of Option.

 

(a)                                  The
Company hereby grants to the Optionee the right (“Option”) to purchase all or
any portion of                   
shares (“Shares”) of the common stock of the Company (“Common Stock”) at a
purchase price of $          
per share (“Option Price”).

 

(b)                                 It
is intended that this Option will not qualify for treatment as an incentive
stock option under Internal Revenue Code Section 422.

 

2.                                      Term
of Option.  This Option may not
be exercised after the first to occur of the following events:

 

(a)                                  The
expiration of three (3) months from the date of the Optionee’s cessation of
services as a Director, unless the Optionee dies within such three-month
period, in which case the expiration of one year from the date of death; or

 

(b)                                 In
the event of the death of the Optionee while in office, the expiration of ten
(10) years from the date of grant of this Option; or

 

(c)                                  In
the event the Optionee becomes Disabled, the expiration of ten (10) years from
the date of grant of this Option; or

 

(d)                                 In
the event of the Retirement of the Optionee, the expiration of ten (10) years
from the date of grant of this Option.

 

3.                                      Exercisability.

 

(a)                                  The
Shares subject to this Option shall become exercisable (“vest”) on the first
anniversary of the date of grant of this Option if the Optionee has not ceased
to be a Director of the Company prior to such anniversary date

 

(b)                                 The
Shares subject to this Option shall vest upon the death or disability of the
Optionee while in office.

 

 

4.                                      Method
of Exercising.  This Option may
be exercised by the Optionee upon delivery of the following documents to the
Company at its principal executive offices:

 

(a)                                  Written
notice specifying the number of full Shares to be purchased;

 

(b)                                 Payment
of the full purchase price for the Shares (i) in cash or by check; (ii) by the
delivery or constructive exchange of shares of Common Stock owned by Optionee,
such shares having a Fair Market Value equal to the aggregate exercise price of
the Shares to be purchased; or (iii) any combination of the consideration provided
in clauses (i) and (ii); above;

 

(c)                                  Such
agreements or undertakings as are required pursuant to the Plan; and

 

(d)                                 Payment
of any taxes (including withholding taxes) that may be required pursuant to the
Plan.

 

5.                                      Assignments.

 

(a)                                  During
the lifetime of the Optionee, this Option shall be exercisable only by the
Optionee personally, or by his legal representative.

 

(b)                                 The
rights of the Optionee under this Option may not be assigned or transferred
except by will or by the laws of descent and distribution.

 

6.                                      No
Rights as a Stockholder.  The
Optionee shall have no rights as a stockholder of any Shares covered by this
Option until the date a certificate for such Shares has been issued to him
following the exercise of the Option.

 

7.                                      Interpretation
of Option.

 

(a)                                  This
Option is made under the provisions of the Plan and shall be interpreted in a
manner consistent with it.

 

(b)                                 Any
provision in this Option inconsistent with the Plan shall be superseded and
governed by the Plan, including Section 5 of the Plan relating to
adjustments with respect to Options in the case of certain corporate
events.  A copy of the Plan is available
to the Optionee at the Company’s principal executive offices upon request and
without charge.

 

8.                                      Legends
on Certificates.  The Optionee
acknowledges that the certificates representing the Shares issued upon exercise
of this Option may bear such legends and be subject to such restrictions on
transfer as the Company may deem necessary to comply with all applicable state
and federal securities laws and regulations.

 

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9.                                      Amendments.  This Option may be amended at any time with
the consent of the Company and the Optionee.

 

IN WITNESS WHEREOF, the
Company and the Optionee have executed this Option as of the date first written
above.

 

	
  OPTIONEE

  	
   

  	
  TETRA TECH, INC .

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
									

 

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