GREEN MOUNTAIN COFFEE, INC.
STOCK OPTION AGREEMENT
UNDER 1993 STOCK OPTION PLAN
INCENTIVE STOCK OPTION
As of January 1, 1997
AGREEMENT entered into by and between Green Mountain Coffee, Inc., a
Delaware corporation with its principal place of business in Waterbury,
Vermont (together with its subsidiaries, the "Company"), and the undersigned
employee of the Company (the "Optionee").
1. The Company desires to grant, subject to stockholder approval as
set forth below, the Optionee an incentive stock option under the Company's
1993 Stock Option Plan, as amended (the "Plan") to acquire shares of the
Company's Common Stock, par value $.10 per share (the "Shares").
2. The Plan provides that each option is to be evidenced by an option
agreement, setting forth the terms and conditions of the option.
ACCORDINGLY, in consideration of the premises and of the mutual
covenants and agreements contained herein, the Company and the Optionee hereby
agree as follows:
1. Grant of Option.
The Company hereby grants, subject to stockholder approval as set forth
below, to the Optionee an incentive stock option (the "Option") to purchase
all or any part of an aggregate of the number of Shares shown at the end of
this Agreement on the terms and conditions hereinafter set forth. This option
is intended to be treated as an incentive stock option under Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
2. Purchase Price.
The purchase price ("Purchase Price") for the Shares covered by the
Option shall be the dollar amount per Share shown at the end of this
Agreement.
3. Time of Exercise of Option.
Subject to Section 12 below, the option shall be first exercisable as
follows:
As to 3,000 of the Shares covered hereby, on January 1, 1997;
As to an additional 10,000 of the Shares covered hereby, on December 31, 1997;
As to an additional 7,000 of the Shares covered hereby, on December 31, 1998
provided that the Optionee shall be entitled to the exercise of the option on
a pro rata basis as of the end of the month preceding the effective date of
the Optionee's termination of employment with the Company in the event that
such termination should occur prior to the expiration of any vesting period.
To the extent the option is not exercised by the Optionee when it becomes
exercisable, it shall not expire, but shall be carried forward and shall be
exercisable, on a cumulative basis, until the Expiration Date, as hereinafter
defined.
4. Term of Options; Exercisability.
(a) Term.
(i) Each Option shall expire on the date shown at the end of
this Agreement (the "Expiration Date"), as determined by
the Board of Directors of the Company (the "Board").
(ii) Except as otherwise provided in this Section 4, if the
Optionee's employment by the Company is terminated, the
option granted to the optionee hereunder shall terminate
on the earlier of ninety days after the date the
Optionee's employment by the Company is terminated, or
(ii) the date on which the Option expires by its terms.
(iii) If the Optionee's employment is terminated by the Company
for cause or because the Optionee is in breach of any
employment agreement, such Option will terminate on the
date the Optionee's employment is terminated by the
Company.
(iv) If the Optionee's employment is terminated by the Company
because the Optionee has become permanently disabled
(within the meaning of Section 22(e)(3) of the Code), such
Option shall terminate on the earlier of (i) one year
after the date such Optionee's employment by the Company
is terminated, or (ii) the date on which the option
expires by its terms.
(v) In the event of the death of the optionee, the Option
granted to such Optionee shall terminate on the earlier of
(i) one year after the date such optionee's employment by
the Company is terminated; or (ii) the date on which the
option expires by its terms.
(b) Exercisability.
(i) Except as provided below, if the Optionee's employment by
the Company is terminated, the Option granted to the
Optionee hereunder shall be exercisable only to the extent
that the right to purchase shares under such Option has
accrued and is in effect on the date the Optionee's
employment by the Company is terminated.
(ii) If the Optionee's employment is terminated by the Company
because he or she has become permanently disabled, as
defined above, the option granted to the Optionee
hereunder shall be immediately exercisable as to the full
number of Shares covered by such Option, whether or not
under the provisions of Section 3 hereof such Option was
otherwise exercisable as of the date of disability.
(iii) In the event of the death of the Optionee, the Option
granted to such Optionee may be exercised to the full
number of Shares covered thereby, whether or not under the
provisions of Section 3 hereof the Optionee was entitled
to do so at the date of his or her death, by the executor,
administrator or personal representative of such Optionee,
or by any person or persons who acquired the right to
exercise such Option by bequest or inheritance or by
reason of the death of such Optionee.
5. Manner of Exercise of Option.
(a) To the extent that the right to exercise the Option has
accrued and is in effect, the option may be exercised in full or in part by
giving written notice to the Company stating the number of Shares exercised
and accompanied by payment in full for such Shares. No partial exercise may
be made for less than one hundred (100) full shares of Common Stock. Payment
may be either wholly in cash or in whole or in part in Shares already owned by
the person exercising the option, valued at fair market value as of the date
of exercise; provided, however, that payment of the exercise price by delivery
of Shares already owned by the person exercising the Option may be made only
if such payment does not result in a charge to earnings for financial
accounting purposes as determined by the Board. Upon such exercise, delivery
of a certificate for paid-up, non-assessable Shares shall be made at the
principal office of the Company to the person exercising the option, not less
than thirty (30) and not more than ninety (90) days from the date of receipt
of the notice by the Company.
(b) The Company shall at all times during the term of the
0ption reserve and keep available such number of Shares as will be sufficient
to satisfy the requirements of the option.
6. Non-Transferability.
The right of the Optionee to exercise the option shall not be assignable
or transferable by the optionee otherwise than by will or the laws of descent
and distribution, and the Option may be exercised during the lifetime of the
Optionee only by him or her. The Option shall be null and void and without
effect upon the bankruptcy of the Optionee or upon any attempted assignment or
transfer, except as hereinabove provided, including without limitation any
purported assignment, whether voluntary or by operation of law, pledge,
hypothecation or other disposition contrary to the provisions hereof, or levy
of execution, attachment, trustee process or similar process, whether legal or
equitable, upon the Option.
7. Representation Letter and Investment Legend.
(a) In the event that for any reason the Shares to be issued upon
exercise of the Option shall not be effectively registered under the
Securities Act of 1933, as amended (the "1933 Act"), upon any date on which
the option is exercised in whole or in part, the person exercising the Option
shall give a written representation to the Company in the form attached hereto
as Exhibit I and the Company shall place an "investment legend", so-called, as
described in Exhibit 1, upon any certificate for the Shares issued by reason
of such exercise.
(b) The Company shall be under no obligation to qualify Shares or to
cause a registration statement or a post-effective amendment to any
registration statement to be prepared for the purposes of covering the issue
of Shares.
8. Adjustments on Changes in Capitalization.
Adjustments on changes in capitalization and the like shall be made in
accordance with the Plan, as in effect on the date of this Agreement.
9. No Special Employment Rights.
Nothing contained in the Plan or this Agreement shall be construed or
deemed by any person under any circumstances to bind the Company to continue
the employment of the Optionee for the period within which this Option may be
exercised. However, during the period of the Optionee's employment, the
Optionee shall render diligently and faithfully the services which are
assigned to the Optionee from time to time by the Board or by the executive
officers of the Company and shall at no time take any action which directly or
indirectly would be inconsistent with the best interests of the Company.
10. Rights as a Shareholder.
The Optionee shall have no rights as a shareholder with respect to any
Shares which may be purchased by exercise of this option unless and until a
certificate or certificates representing such Shares are duly issued and
delivered to the Optionee. Except as otherwise expressly provided in the
Plan, no adjustment shall be made for dividends or other rights for which the
record date is prior to the date such stock certificate is issued.
11. Withholding Taxes.
Whenever Shares are to be issued upon exercise of this Option, the
Company shall have the right to require the Optionee to remit to the Company
an amount sufficient to satisfy all Federal, state and local withholding tax
requirements prior to the delivery of any certificate or certificates for such
Shares. The Company may agree to permit the Optionee to withhold Shares
purchased upon exercise of this Option to satisfy the above-mentioned
withholding requirement; provided, however, no such agreement may be made by
an Optionee who is an officer or director within the meaning of Section 16 of
the Securities Exchange Act of 1934, as amended, except pursuant to a standing
election to so withhold Shares purchased upon exercise of an Option, such
election to be made in the form set forth in Exhibit 2 hereto and to be made
not less than six (6) months prior to the date of such exercise. such election
may be revoked by the Optionee only upon six (6) months prior written notice
to the Company.
12. Stockholder Approval.
On July 26, 1996, the Board amended the Plan, subject to stockholder
approval, to increase the number of shares for which options are available for
grant under the Plan by 200,000 (the "Increased shares"). The shares
underlying the option are a portion of the increased Shares, and accordingly,
the grant of the Option is subject to approval of the stockholders of the
Company. No portion of the option may be exercised prior to obtaining such
approval. Should the stockholders of the company fail to approve the
amendment to the Plan within twelve (12) months of the date hereof, this
Agreement and the Option shall thereupon terminate immediately, and shall be
void ab initio and of no force or effect.
IN WITNESS HEREOF, the Company has caused this Agreement to be executed,
and the optionee has hereunto set his or her hand and seal, all as of the day
and year first above written.
GREEN MOUNTAIN COFFEE, INC. OPTIONEE
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Xxxxxx X. Xxxxxxx Signature
President
Name: Xxxx Xxxxx
(Printed)
Address:
______________________
Social Security Number
20,000
-----------------
Number of Shares
$6
_________________
Purchase Price Per Share
January 1, 2007
_______________
Expiration Date
EXHIBIT 1
TO STOCK OPTION AGREEMENT
Gentlemen:
In connection with the exercise by me as to shares of Common
Stock, $.10 per share par value, of Green Mountain Coffee, Inc. (the
"Company") under the incentive stock option agreement dated as of January 1,
1996, granted to me under the 1993 Stock Option Plan, as amended, I hereby
acknowledge that I have been informed as follows:
1. The shares of common stock of the Company to be issued to me
pursuant to the exercise of said option have not been registered under the
Securities Act of 1933 (the "1933 Act"), and accordingly, must be held
indefinitely unless such shares are subsequently registered under the 1933
Act, or an exemption from such registration is available.
2. Routine sales of securities made in reliance upon Rule 144 under
the 1933 Act can be made only after the holding period and in limited amounts
in accordance with the terms and conditions provided by that Rule, and in any
sale to which that Rule is not applicable, registration or compliance with
some other exemption under the 1933 Act will be required.
3. The Company is under no obligation to me to register the shares or
to comply with any such exemptions under the 1933 Act.
4. The availability of Rule 144 is dependent upon adequate current
public information with respect to the Company being available and, at the
time that I may desire to make a sale pursuant to the Rule, the Company may
neither wish nor be able to comply with such requirement.
In consideration of the issuance of certificates for the shares to me, I
hereby represent and warrant that I am acquiring such shares for my own
account for investment, and that I will not sell, pledge or transfer such
shares in the absence of an effective registration statement covering the
same, except as permitted by the provisions of Rule 144, if applicable, or
some other applicable exemption under the 1933 Act. In view of this
representation and warranty, I agree that there may be affixed to the
certificates for the shares to be issued to me, and to all certificates issued
hereafter representing such shares (until in the opinion of counsel, which
opinion must be reasonably satisfactory in form and substance to counsel for
the Company, it is no longer necessary or required) a legend as follows:
"The shares of common stock represented by this certificate have not
been registered under the Securities Act of 1933, as amended (the
"Act"), and were acquired by the registered holder, pursuant to a
representation and warranty that such holder was acquiring such shares
for his own account and for investment, with no intention to transfer or
dispose of the same, in violation of the registration requirements of
the Act. These shares may not be sold, pledged, or transferred in the
absence of an effective registration statement under the Act, or an
opinion of counsel, which opinion is reasonably satisfactory to counsel
to the Company, to the effect that registration is not required under
the Act."
I further agree that the Company may place a stop order with its
Transfer Agent, prohibiting the transfer of such shares, so long as the legend
remains on the certificates representing the shares.
Very truly yours,
Xxxx Xxxxx
EXHIBIT 2
TO STOCK OPTION AGREEMENT
Gentlemen:
The undersigned Optionee hereby elects and agrees that, whenever the
undersigned exercises a stock option (including any options which now or may
hereafter he granted) , the Company shall withhold from the shares issuable
upon such exercise, such number of shares as is equal in value to the federal
and state withholding taxes due upon such exercise, The undersigned further
acknowledges and agrees that this election may not be revoked without six (6)
months prior written notice to the Company.
OPTIONEE:
Signature
Name: Xxxx Xxxxx
Printed
----------------------
Social Security Number
