Incentive Stock Option Agreement
(Officer Participants in Executive Retirement Plan)
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THIS STOCK OPTION AWARD AGREEMENT (the "Agreement") is made and entered into
this <> (the "Grant Date") between Xxxxxxxx'x International, Inc., a
Delaware corporation (the "Corporation"), and <> (the "Holder") in
connection with the grant of an Incentive Stock Option under the XXXXXXXX'X
INTERNATIONAL, INC. AMENDED AND RESTATED 1995 EQUITY INCENTIVE PLAN (the
"Plan").
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WITNESSETH:
WHEREAS, the Holder is an employee of the Corporation or one of its Affiliates
and the Corporation desires to encourage him to own Shares and to give him added
incentive to advance the interests of the Corporation through the Plan and
desires to grant the Holder an Incentive Stock Option to purchase Shares under
terms and conditions established by the Board of Directors.
NOW, THEREFORE, in consideration of these premises, the parties agree that the
following, along with the terms and conditions set forth in the Plan, shall
constitute the Agreement between the Corporation and the Holder:
1. Definitions. Capitalized terms used in this Agreement but not defined
herein shall have the meaning set forth in the Plan. In addition, the
following terms shall have the meanings specified below:
1.1 "Retirement" shall mean the satisfaction of all conditions
necessary for the Holder to become entitled to receive benefits
under the Corporation's Executive Retirement Plan.
1.2 "Securities Act" shall mean the Securities Act of 1933, as
amended.
2. Grant of Incentive Stock Option and Termination. Subject to the terms
and conditions set forth herein and in the Plan, the Corporation grants
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to the Holder an Incentive Stock Option to purchase from the
Corporation during the period ending ten (10) years from the Grant Date
(the "Expiration Date") <> Shares at a price of
<> per share, subject to adjustment as provided in the
Plan.
3. Exercise. During the Holder's lifetime, only he may exercise this
Incentive Stock Option, as the case may be. This Incentive Stock Option
shall vest and become exercisable in full on or after the third
anniversary of the Grant Date and, except as specifically provided
otherwise herein or in the Plan, not before such date.
4. Notice of Exercise. This Incentive Stock Option may be exercised in
whole or in part, from time to time, in accordance with Paragraphs 2
and 3, by written notice to the Corporation at the address provided in
Paragraph 17, which notice shall:
(a) specify the number of Shares to be purchased and the Exercise
Price to be paid therefor;
(b) if the person exercising this Incentive Stock Option is not the
Holder himself, contain or be accompanied by evidence satisfactory
to the Committee of such person's right to exercise this Incentive
Stock Option; and
(c) be accompanied by payment in full of the Exercise Price in a form
permitted by the Committee.
5. Investment Letter. The Holder agrees that the Shares acquired on
exercise of this Incentive Stock Option shall be acquired for his own
account for investment only and not with a view to, or for resale in
connection with, any distribution or public offering thereof within the
meaning of the Securities Act, or other applicable securities laws. If
the Board of Directors or Committee so determines, any stock
certificates issued upon exercise of this Incentive Stock Option shall
bear a legend to the effect that the shares have been so acquired. The
Corporation may, but in no event shall be required to, bear any
expenses of complying with the Securities Act other applicable
securities laws or the rules and regulations of any national securities
exchange or other regulatory authority in connection with the
registration, qualification, or transfer, as the case may be, of this
Incentive Stock Option or any Shares acquired upon the exercise
thereof. The foregoing restrictions on the transfer of the Shares shall
be inoperative if (a) the Corporation previously shall have been
furnished with an opinion of counsel, satisfactory to it, to the effect
that such transfer will not involve any violation of the Securities Act
or other applicable laws or (b) the Shares shall have been duly
registered in compliance with the Securities Act and other applicable
securities laws. If this Incentive Stock Option is so registered under
the Securities Act, the Holder agrees that he will not make a public
offering of the said shares except on a national securities exchange on
which the Shares of the Corporation are then listed.
6. Transfer of Option. The Incentive Stock Option shall not be
transferable except by will or by the laws of descent and distribution.
No assignment or transfer of this Incentive Stock Option, whether
voluntary or involuntary, by operation of law or descent or
distribution, shall vest in the assignee or transferee any interest or
right whatsoever in this Incentive Stock Option.
7. Issue of Shares. The Corporation shall not be required to issue or
transfer any certificates for Shares purchased upon exercise of this
Incentive Stock Option until all applicable requirements of law have
been complied with and such shares shall have been duly listed on any
securities exchange on which the Shares may then be listed.
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8. No Effect on Capital Structure. This Incentive Stock Option shall not
affect the right of the Corporation or any Affiliate thereof to
reclassify, recapitalize or otherwise change its capital or debt
structure or to merge, consolidate, convey any or all of its assets,
dissolve, liquidate, windup, or otherwise reorganize.
9. Expiration of Option. This Incentive Stock Option shall expire on the
Expiration Date. In the event of a Termination of Service of the Holder
prior to the expiration of this Incentive Stock Option, the following
rules shall apply:
(a) Termination of Employment - Other than Disability, Death or
Retirement. If there is a Termination of Service of the Holder for
a reason other than the Holder's death, Disability or Retirement,
the portion of this Incentive Stock Option, if any, that remains
unexercised shall terminate and cease to be exercisable three (3)
months after the date of such Termination of Service and that
portion, if any, that pursuant to this Agreement is not yet
exercisable on the date of such Termination of Service, shall
terminate and cease to be exercisable as of such date.
(b) Termination of Employment - Disability. If there is a Termination
of Service of the Holder by reason of Disability, the Holder shall
have the right for one (1) year after such Termination of Service
to exercise this Incentive Stock Option to the extent this
Incentive Stock Option is exercisable on such Termination of
Service date and thereafter, this Incentive Stock Option shall
terminate and cease to be exercisable.
(c) Termination of Employment - Death. If there is a Termination of
Service of the Holder by reason of death, this Incentive Stock
Option shall be exercisable by the Holder's legal representatives,
legatees, or distributees for one (1) year following the date of
the Holder's death to the extent this Incentive Stock Option is
exercisable on the Holder's date of death, and thereafter this
Incentive Stock Option shall terminate and cease to be
exercisable.
(d) Termination of Employment - Retirement. If there is a Termination
of Service of the Holder by reason of Retirement, the vesting and
exercisability of this Incentive Stock Option shall be determined
under the Xxxxxxxx'x International, Inc. Executive Retirement
Plan; provided that exercise may not occur after the Expiration
Date.
10. Change in Control. The effect of a Change in Control shall be as set
forth in either the Change in Control and Noncompete Agreement entered
into between the Holder and the Corporation, or, in the event Holder
has not entered into a Change in Control and Noncompete Agreement, the
Holder's employment agreement with the Corporation. In the event the
Holder has not entered into either a Change in Control and Noncompete
Agreement or an employment agreement with the Corporation (or Holder
has entered into an agreement but such agreement does not address the
effect of a Change in Control on this Agreement), the effect of a
Change in Control shall be as set forth in the Plan.
11. Committee Authority. Any questions concerning the interpretation of
this Agreement or the Plan, and any controversy which arises under this
Agreement or the Plan shall be settled by the Committee in its sole
discretion.
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12. Right of Set-off. By accepting this agreement, Holder consents to a
deduction from any amounts the Corporation owes Holder from time to
time (including amounts owed to Holder as wages or other compensation,
fringe benefits, or vacation pay), to the extent of the amounts owed by
Holder to the Corporation hereunder. Whether or not the Corporation
elects to make any set-off in whole or in part, if the Corporation does
not recover by means of set-off the full amount owed it by Holder,
calculated as set forth above, Holder agrees to pay immediately in cash
the unpaid balance to the Corporation.
13. Committee Discretion. Holder may be released from its obligations under
paragraph 12 above only if the Committee determines in its sole
discretion that such action is in the best interests of the
Corporation.
14. Notice of Disqualifying Disposition. In order to enable the Corporation
to avail itself of any income tax deduction to which it may be
entitled, the Holder shall notify the Corporation of his intent to
dispose of any of the Shares purchased pursuant to this Incentive Stock
Option within two (2) years from the date of the grant of the Incentive
Stock Option and one (1) year from the date of exercise of the
Incentive Stock Option. Promptly after such disposition the Holder
shall notify the Corporation of the number of Shares disposed of, the
dates of acquisition and disposition of such shares, and the
consideration, if any, received on such disposition. If, in connection
with any such disposition, the Corporation becomes liable for
withholding taxes and has no amounts owing the Holder with which to
discharge its withholding obligation, the Holder shall provide the
Corporation with the amount needed to discharge the Corporation's
withholding obligation and shall indemnify the Corporation against any
penalties it may incur through its inability to apply amounts owing the
Holder in discharge of its withholding obligations. Nothing in this
Paragraph 14 shall give the Holder any right to dispose of the Shares
in a manner that is inconsistent with any Paragraph of this Agreement,
the Plan, or any stock transfer restriction agreement entered into by
the Holder.
15. Incentive Option Qualification. This Incentive Stock Option is intended
to qualify as an "incentive stock option" within the meaning of Section
422A of the Code, and shall be so construed; provided, however, that
nothing in this Agreement shall be interpreted as a representation,
guarantee or other undertaking on the part of the Corporation that this
Incentive Stock Option is or will be determined to be an "incentive
stock option" within such section or any other section of the Code. Any
acceleration, exercise more than three (3) months after termination of
employment, or extension of exercisability pursuant to this Agreement,
the Plan, or pursuant to the Change in Control and Noncompete Agreement
between the Holder and the Corporation may result in this Incentive
Stock Option ceasing to qualify as any incentive stock option, or may
result in the tax benefits of such status not being available, as of
the date such acceleration or extension takes effect, or as of the date
of exercise more than three (3) months after termination of employment.
16. Plan Controls. The terms of this Agreement are governed by the terms of
the Plan and in the case of any inconsistency between the terms of this
Agreement and the terms of the Plan, the terms of the Plan shall
control.
17. Notice. Whenever any notice is required or permitted hereunder, such
notice must be in writing and personally delivered or sent by mail. Any
notice required or permitted to be delivered hereunder shall be deemed
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to be delivered on the date which it was personally delivered, or,
whether actually received or not, on the third business day after it is
deposited in the United States mail, certified or registered, postage
prepaid, addressed to the person who is to receive it at the address
which such person has theretofore specified by written notice delivered
in accordance herewith. The Corporation or Holder may change, at any
time and from time to time, by written notice to the other, the address
previously specified for receiving notices. Until changed in accordance
herewith, the Corporation and the Holder specify their respective
addresses as set forth below:
Corporation: XXXXXXXX'X INTERNATIONAL, INC.
0000 X. 000XX XXXXXX
XXXXXXXX XXXX, XX 00000
Holder: <>
0000 X. 000XX XXXXXX
XXXXXXXX XXXX, XX 00000
18. Information Confidential. As partial consideration for the granting of
this Incentive Stock Option, the Holder agrees that he will keep
confidential all information and knowledge that he has relating to the
manner and amount of his participation in the Plan, provided, however,
that such information may be disclosed as required by law and may be
given in confidence to the Holder's spouse, tax and financial advisors,
or to a financial institution of the extent that such information is
necessary to secure a loan.
19. Governing Law. Where applicable, the provisions of this Agreement shall
be governed by the contract law of the State of Kansas.
IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed and
the Holder has hereunto set his hand on the day and year first above written.
XXXXXXXX'X INTERNATIONAL, INC.
By:
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Name: Xxxxx X. Xxxx
Title: Chairman & Chief Executive Officer
Holder
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Name: <>
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