Document:

Ex-10.1

 

Exhibit 10.1

DIRECTOR NON-QUALIFIED OPTION AGREEMENT

     THIS NON-QUALIFIED OPTION AGREEMENT (the “Agreement”), is dated as of the ___day of
___, 20___by and between Corrections Corporation of America, a Maryland corporation (the
“Company”), and ___(“Optionee”).

W I T N E S S E T H:

     WHEREAS, the Company has adopted the Amended and Restated Corrections Corporation of America
2000 Stock Incentive Plan (the “Plan”), which authorizes and directs the Company to grant Options
(as defined in the Plan) to members of the Company’s Board of Directors (the “Board”) who are not
employees of the Company (“Non-Employee Directors”);

     WHEREAS, the Company and Optionee wish to confirm the terms and conditions of an Option
granted to the Optionee on ___, 20___(the “Date of Grant”).

     NOW, THEREFORE, in consideration of the premises, the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, it is agreed between the parties hereto as follows:

     1. Definitions. Except as provided in this Agreement, or unless the context otherwise
requires, the terms used herein shall have the same meaning as set forth in the Plan.

     2. Grant of Option. Upon and subject to the terms, restrictions, limitations and
conditions stated herein, the Company hereby grants to Optionee an option (the “Option”) to
purchase up to ______ shares of the Company’s Common Stock (collectively, the “Option Shares”).

     3. Option
Price. The purchase price per Option Share shall be $______ (the “Option
Price”). This purchase price equals 100% of the Fair Market Value of each Option Share on the Date
of Grant.

     4. Exercise; Vesting; Forfeiture.

          (i) Except as otherwise provided herein, Optionee shall have the right to exercise the Option,
if and to the extent the Option has vested in accordance with subparagraphs (iii) and (iv) below,
at any time during the ten-year period commencing on the Date of Grantprovided, however, that
except as otherwise provided in subparagraph (iv) below, Optionee may not exercise the Option
unless Optionee is continuously after the Date of Grant a director of the Company for a one-year
period.

          (ii) Optionee shall exercise the Option in accordance with the procedures set forth in Section
6(e) of the Plan. Optionee (or the personal representative of or successor to Optionee) shall have
no rights as a shareholder with respect to any shares covered by this Option

 

 

until the issuance of a share certificate to him for such shares. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, securities or other property) or
distributions or other rights on or with respect to the Option Shares for which the record date is
prior to the date of exercise, except as provided in Section 6 of the Plan.

     (iii) Subject to the provisions of subparagraph (iv) below, the Option shall vest with respect
to the Option Shares on the Vesting Date (as herein defined). For purposes hereof, the term
“Vesting Date” shall mean the following date: ______.

     (iv) In the event that: (a) Optionee dies while serving as a director of the Company or within
three (3) months after the termination of Optionee’s position as a director of the Company for any
reason; or (b) Optionee’s service as director of the Company terminates by reason of Optionee’s
Disability, then in any such case the Option shall vest in full and may be, unless earlier
terminated or expired, exercised by Optionee (or by Optionee’s estate or by a person who acquired
the right to exercise such Option by bequest or inheritance or otherwise by reason of the death or
Disability of Optionee) at any time during the stated term of the Option. In the event that there
occurs a Change of Control, then in such case the Option shall vest in full and, unless earlier
terminated or expired, may be exercised by Optionee (or by Optionee’s estate or by a person who
acquired the right to exercise such Option by bequest or inheritance or otherwise by reason of the
death or Disability of Optionee) within one (1) year following the Change in Control. For the
purpose of this Agreement and notwithstanding any provision(s) of the Plan or this Agreement to the
contrary, subject to the first sentence in this subparagraph (iv), in the event Optionee’s service
as a director of the Company is terminated (other than as the result of Optionee’s death or
Disability) prior to ______, 20___, then the Option, to the extent the Option has vested and
unless it earlier terminates or expires, may be exercised at any time during the stated term of the
Option, with the unvested portion of the Option being forfeited. Subject to the first sentence of
this subparagraph (iv), in the event Optionee’s service as a director of the Company is terminated
(including as the result of Optionee’s death or Disability) on or following ______, 20___,
unless terminated or expired, the Option shall become immediately vested and nonforfeitable for the
ten-year period following the Date of Grant. Nothing in this Agreement or in any Option granted
pursuant hereto shall confer upon Optionee any right to continue in the service of the Company or
interfere in any way with the right of the Company to terminate Optionee’s service at any time.

     5. Option Subject to Plan. The Option and the Option Shares shall be subject to, and
the Company and Optionee agree to be bound by, all of the terms and conditions of the Plan
(including restrictions on transferability), as the same shall have been amended in accordance with
the terms thereof.

     6. Amendments to Option. Subject to the restrictions contained in the Plan, the Board
may waive any conditions or rights under, amend any terms of, or alter, suspend, discontinue,
cancel or terminate, the Option, prospectively or retroactively; provided that any such waiver,
amendment, alteration, suspension, discontinuance, cancellation or termination that would adversely
affect the rights of the Optionee or the holder or beneficiary of the Option shall not to that
extent be effective without the consent of the Optionee, holder or beneficiary affected.

 

 

     7. Withholding. In order to provide the Company with the opportunity to claim the
benefit of any income tax deduction which may be available to it upon the exercise of the Option,
and in order to comply with all applicable federal or state tax laws or regulations, the Company
may take such action as it deems appropriate to insure that, if necessary, all applicable federal,
state or other taxes are withheld or collected from the Optionee.

     8. Governing Laws. This Agreement shall be construed, administered and enforced
according to the laws of the State of Maryland, without regard to the conflicts of laws provisions
thereof; provided, however, no Option may be exercised except, in the reasonable judgment of the
Board, in compliance with exemptions under applicable state securities laws of the state in which
Optionee resides, and/or any other applicable securities laws.

     9. Successors. This Agreement shall be binding upon and inure to the benefits of the
heirs, legal representatives, successors and permitted assigns of the parties.

     10. Notice. Except as otherwise specified herein, all notices and other
communications under this Agreement shall be in writing and shall be deemed to have been given if
personally delivered or if sent by registered or certified United States mail, return receipt
requested, postage prepaid, addressed to the proposed recipient at the last known address of such
recipient. Any party may designate any other address to which notices shall be sent by giving
notice of such address to the other parties in the same manner provided herein.

     11. Severability. In the event that any one or more of the provisions or portion
thereof contained in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, the same shall not invalidate or otherwise affect any other
provisions of this Agreement and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision or portion thereof had never been contained herein.

     12. Entire Agreement. Subject to the terms and conditions of the Plan, this
Agreement expresses the entire understanding and agreement of the parties hereto with respect to
such terms, restrictions and limitations. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall constitute one and
the same instrument.

     13. Violation. Any transfer, pledge, sale, assignment, or hypothecation of
the Option except in accordance with this Agreement shall be a violation of the terms hereof and
shall be void and without effect.

     14. Headings. Section headings used herein are for convenience of reference only and
shall not be considered in construing this Agreement.

     15. Specific Performance. In the event of any actual or threatened default in, or
breach of, any of the terms, conditions and provisions of this Agreement, the party or parties who
are thereby aggrieved shall have the right to specific performance and injunction in addition to
any and all other rights and remedies at law or in equity, and all such rights and remedies shall
be cumulative.

 

 

     16. Counterparts. This Agreement may be executed by the signatures of each of the
parties hereto, or to a counterpart of this Agreement, and all such counterparts shall collectively
constitute one Agreement. Facsimile signatures shall constitute original signatures for purposes
of this Agreement.

 

 

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written.

	 	 	 	 	 
	 	COMPANY:

CORRECTIONS CORPORATION OF AMERICA

 	 
	 	By:  	 	 
	 	Title: 	 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	OPTIONEE:

 	 
	 	
 	 
	 	 	 
	 	 	 
	 

	 	 	 	 	 
	 	Signature:EX-10.1 OFFER LETTER AGREEMENT/JAMES HARDEE

 

Exhibit 10.1

August 3, 2007

Via Hand Delivery

Mr. James Hardee

                         RE:   Offer of Employment

Dear Jim:

     We are very pleased to confirm our discussions regarding your joining Gevity as Senior Vice
President, Sales and Field Service, as soon as practicable. In this capacity, you will report
directly to Erik Vonk, Chairman and Chief Executive Officer, serve on the Company’s Executive Team
and be primarily responsible for the duties and responsibilities of this position set forth below
and as they may evolve over time. We have prepared the following general summary of the key terms
of our offer of employment for your review.

	 	 	 	 	 
	 

	 	Start Date:
	 	On or about August 15, 2007.
	 
	 	 	 	 
	 

	 	Primary Duties:
	 	Overseeing the Company’s sales and field service organization.

	 
	 	 	 	 
	 

	 	
	 	In this role you are end-responsible for the execution of the Company’s growth, expansion and client
retention plans and strategies.
	 
	 	 	 	 
	 

	 	Base Salary:
	 	$385,000 per year payable in equal installments of $14,807.69 on the Company’s normal bi-weekly payroll
schedule. You will be eligible for a first review on January 1, 2008.
	 
	 	 	 	 
	 

	 	Paid Time Off:
	 	You will be eligible for a total of 216 hours of paid time off (including 4 weeks of paid vacation)
during each calendar year of employment, prorated for partial years.
	 
	 	 	 	 
	 

	 	Cash Bonus:
	 	Short Term Incentive — Commencing on January 1, 2008, you will participate in the Short Term Incentive
Program for Executives. This program currently awards a target cash bonus amount equal to 80% of your
base salary actually paid to you during a calendar year (for performance at target level), 50% of target
at threshold and 150% of target at superior. The actual amount of the award will be based, in part, on
Mr. Vonk’s evaluation of your individual performance and contribution, as well as the overall financial
performance of the Company. Of course, all bonus

 

 

Mr. Jim Hardee

Page 2 of 5

	 	 	 	 	 
	 

	 	 	 	payments and compensation decisions regarding senior executives are subject to final approval by the Compensation Committee of the
Board.
	 
	 	 	 	 
	 

	 	 	 	For the remainder of 2007, this same program will apply on a pro-rated basis, based on your performance
over the remaining months of 2007, and payable at the same time as any other bonuses to Senior
Executives are paid, and subject to final approval by the Compensation Committee of the Board. For the
purpose of this program, a new production volume target will be set for the remainder of 2007.
Performance against this target will determine the pro-rated STI payout for this year.
	 
	 	 	 	 
	 

	 	Stock Options

And Restricted

Shares:
	 	Initial Stock Option Award — As an inducement to commence employment with Gevity, you will receive an
award of non-qualified stock options to purchase 45,000 shares of the Company’s common stock having a
10-year term and 4-year vesting schedule, pursuant to which 25% of such options vest on each anniversary
of the date of the award, with an exercise price equal to the price per share at the close of trading on
your first day of active employment. In addition, you will receive an award of 12,500 restricted shares
of the Company’s common stock having a 4-year vesting schedule, pursuant to which 25% of such shares
vest on each anniversary of the date of the award. Such options and restricted shares will be granted
under and subject to the terms of the Company’s 2005 Equity Incentive Plan.
	 
	 	 	 	 
	 

	 	 	 	Long Term Incentive — Commencing on January 1, 2008, you will participate in the Company’s Long Term
Incentive Plan for executives that will provide you with a target equity incentive, generally in the
form of a Stock Option grant or such other award type as determined by the Board or a duly authorized
Committee thereof, with a target value equal to 150% of your base salary (for performance at target
levels), 75% of target at threshold and 150% of target at superior, as determined by the Black-Scholes
valuation method (or such subsequently adopted valuation method). The actual annual award will be
recommended by Mr. Vonk to the Compensation Committee of the Board, based on the contribution of the
disciplines under your direct control as well as on overall performance of the Company.
	 
	 	 	 	 
	 

	 	Benefits:
	 	You are immediately eligible to participate in Gevity’s health and welfare
benefits. Should you elect to participate in Gevity’s health and welfare
benefits, they will begin immediately upon

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Mr. Jim Hardee

Page 3 of 5

	 	 	 	 	 
	 

	 	 	 	your hire date. You should submit your Benefits Election Form
with your other new hire paperwork. The Company’s contribution
toward coverage commences as of your date of employment.
	 
	 	 	 	 
	 

	 	 	 	In case you would opt continuation of an existing plan, the
Company will make its best efforts to either contribute to that
plan or reimburse you for plan expenses for an aggregate value
approximately equal to contributions made by the Company to its
own plan on your behalf.
	 
	 	 	 	 
	 

	 	Relocation:
	 	In order to assist you with your relocation to the
Bradenton/Sarasota, FL area, and in lieu of any other
assistance available under the Company’s Relocation
Policy, you will be eligible for relocation assistance in
the amount of $250,000. You may utilize this budget to
assist you with temporary housing, house-hunting trips,
and similar expenses. It is anticipated that you will
relocate to the Bradenton/Sarasota, FL area by June 1,
2008, after which any unused balance of the $250,000 will
be paid to you on the first regular payroll date following
your relocation. Any amount paid to you will be subject
to gross-up for tax purposes.
	 
	 	 	 	 
	 

	 	Change in

Control:
	 	You will be eligible to enter into a Change in Control
Severance Agreement in the form customarily used by the
Company for other senior executives of the Company.
Generally, the agreement provides for certain payments to
you if you are terminated within a two (2) year period
following a change in control of the Company. Please refer
to the form of such agreement provided to you for the
specific terms and conditions.
	 
	 	 	 	 
	 

	 	Indemnification

Agreement:
	 	You will be eligible to enter into an Indemnification
Agreement with the Company in the customary form of such
agreement for senior executives, as the same may be
amended from time to time.
	 
	 	 	 	 
	 

	 	General

Severance:
	 	In the event your employment is terminated for Good Reason
or any reason other than for “Cause” and provided you
execute a full and complete general release of all
employment-related claims, if any, against the Company,
the Company will pay you the sum of one times your annual
base salary, as in effect at the time of your termination.
Such sum shall be paid to you in twenty-six (26) equal
payments on the Company’s regular bi-weekly payroll cycle
over the twelve (12) month period immediately following
the

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Mr. Jim Hardee

Page 4 of 5

	 	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	termination of your employment but in no event shall payments
extend beyond March 15th of the year following your
termination. In addition, during the Severance Period, you may
continue to participate in the health and dental plans provided
to you as of the date of termination at the same level and in the
same manner as if your employment had not terminated. If the
terms of any benefit plan referred to in this section do not
permit your continued participation, then the Company will
arrange for other coverage providing substantially similar
coverage at no additional cost to you.
	 
	 	 	 	 
	 

	 	 	 	For purposes of this offer, Paragraph 1(c) of the Change of
Control Severance Agreement is incorporated herein to define
“Cause” and the circumstances in which your employment may be
terminated for Cause. “Good Reason” means, without Executive’s
express written consent, the occurrence of any of the following
events:
	 
	 	 	 	 
	 

	 	 	 	     (i) (A) any change in the duties or responsibilities of
Executive that is inconsistent in any material and adverse
respect with Executive’s primary position, duties,
responsibilities, or status with the Company (including any
material and adverse diminution of such duties or
responsibilities) or (B) a material and adverse change in
Executive’s titles or offices with the Company;
	 
	 	 	 	 
	 

	 	 	 	     (ii) a reduction by the Company in Executive’s rate of
annual base salary or annual target bonus opportunity as the same
may be increased from time to time; or
	 
	 	 	 	 
	 

	 	 	 	     (iii) any requirement of the Company that Executive be based
anywhere more than fifty (50) miles from the office where
Executive is located at the time of his initial employment.
	 
	 	 	 	 
	 

	 	 	 	An isolated, insubstantial and inadvertent action taken in good
faith and which is remedied by the Company within ten (10) days
after receipt of notice thereof given by Executive shall not
constitute Good Reason. Executive’s right to terminate employment
for Good Reason shall not be affected by Executive’s incapacities
due to mental or physical illness and Executive’s continued
employment shall not constitute consent to, or a waiver of rights
with respect to, any event or condition constituting Good Reason;
provided, however, that Executive must provide notice of
termination of employment within thirty (30) days following
Executive’s knowledge of an event constituting Good Reason or
such event shall not constitute Good Reason under this Agreement.

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Mr. Jim Hardee

Page 5 of 5

     As a condition of employment, the Company must be satisfied that you are not subject to any
agreement or understanding that would directly or indirectly restrict your ability to perform
duties for the Company. You will also need to successfully undergo a background check and drug
screen prior to beginning employment. Further, as a senior executive, you will be required to
qualify for registration as a “controlling person” under the various state laws that regulate the
Company’s business.

     Please let us know whether you accept these general terms of employment, by signing in the
space provided below, and returning a copy to my attention.

     Jim, we believe that the position of Senior Vice President, Sales and Field Service provides
an excellent opportunity for you to join a strong leadership team and share in the direct
responsibility for the ongoing success of an exciting, challenging, and growing company.

     Our senior management and the board of directors look forward to welcoming you to the Gevity
team.

	 	 	 	 	 
	 	Very Truly Yours,

 	 
	 	/s/ Erik Vonk
 	 
	 	Erik Vonk 	 
	 	Chairman and Chief Executive Officer 	 
	 

Agreed to and Accepted by:

	 	 	 	 	 
	 	 	 
	 /s/ James Hardee
 	 
	James Hardee 	 
	 	 	 

Cc: Edwin E. Hightower, Jr., Esq.

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