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EXHIBIT 10.10
GULF SOUTH MEDICAL SUPPLY, INC.
INCENTIVE STOCK OPTION AGREEMENT
Gulf South Medical Supply, Inc., a Delaware corporation (the
"Company"), hereby grants as of (Date) to (Employee) (the "Employee"), an
option to purchase a maximum of (Number) shares (the "Option Shares") of its
Common Stock, $.01 par value ("Common Stock"), at the price of $(ExercisePrice)
per share, on the following terms and conditions:
1. GRANT UNDER THE COMPANY'S 1997 STOCK PLAN. This option is
granted pursuant to and is governed by the Company's 1997 Stock Plan (the
"Plan") and, unless the context otherwise requires, terms used herein shall
have the same meaning as in the Plan. Determinations made in connection with
this option pursuant to the Plan shall be governed by the Plan as it exists on
this date.
2. GRANT AS INCENTIVE STOCK OPTION; OTHER OPTIONS. This option
is intended to qualify as an incentive stock option under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"). Notwithstanding the
above, this option shall be treated as a Non-Qualified Option if the Plan is
not approved by the Company's stockholders on or before March 2, 1998. This
option is in addition to any other options heretofore or hereafter granted to
the Employee by the Company or any Related Corporation (as defined in the
Plan), but a duplicate original of this instrument shall not effect the grant
of another option.
3. VESTING OF OPTION IF EMPLOYMENT CONTINUES. If the Employee
has continued to be employed by the Company or any Related Corporation on the
following dates, the Employee may exercise this option for the number of shares
of Common Stock set opposite the applicable date:
Less than one year from the date - (VestingNumber) shares
hereof
One year but less than two years from - an additional (VestingNumber) shares
the date hereof
Two years but less than three years - an additional (VestingNumber) shares
from the date hereof
Three years but less than four years - an additional (VestingNumber) shares
from the date hereof
Four years or more from the date - an additional (VestingNumber) shares
hereof
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Notwithstanding the foregoing, in accordance with and subject to the provisions
of the Plan, the Committee may, in its discretion, accelerate the date that any
installment of this Option becomes exercisable. The foregoing rights are
cumulative and (subject to Sections 4 or 5 hereof if the Employee ceases to be
employed by the Company and all Related Corporations) may be exercised on or
before the date which is ten years from the date this option is granted.
4. TERMINATION OF EMPLOYMENT.
(a) TERMINATION OTHER THAN FOR CAUSE. If the Employee
ceases to be employed by the Company and all Related Corporations,
other than by reason of death or disability as defined in Section 5 or
other than for Cause as defined in Section 4(c), no further
installments of this option shall become exercisable, and this option
shall terminate (and may no longer be exercised) after the passage of
three (3) months from the Employee's last day of employment, but in no
event later than the scheduled expiration date. In such a case, the
Employee's only rights hereunder shall be those which are properly
exercised before the termination of this option.
(b) TERMINATION FOR CAUSE. If the employment of the
Employee is terminated for Cause (as defined in Section 4(c)), this
option shall terminate at the time of such termination of employment
and shall thereafter not be exercisable to any extent whatsoever. For
the purposes of this Section 4(b), termination of employment shall be
deemed to occur when the Employee receives notice of such termination.
(c) DEFINITION OF CAUSE. "Cause" shall mean conduct
involving one or more of the following: (i) the substantial and
continuing failure of the Employee, after notice thereof, to render
services to the Company or Related Corporation in accordance with the
terms or requirements of his or her employment; (ii) disloyalty, gross
negligence, willful misconduct, dishonesty or breach of fiduciary duty
to the Company or Related Corporation; (iii) the commission of an act
of embezzlement or fraud; (iv) deliberate disregard of the rules or
policies of the Company or Related Corporation which results in direct
or indirect loss, damage or injury to the Company or Related
Corporation; (v) the unauthorized disclosure of any trade secret or
confidential information of the Company or Related Corporation; or
(vi) the commission of an act which constitutes unfair competition
with the Company or Related Corporation or which induces any customer
or supplier to breach a contract with the Company or Related
Corporation.
5. DEATH; DISABILITY.
(a) DEATH. If the Employee dies while in the employ of
the Company or any Related Corporation, this option may be exercised,
to the extent otherwise exercisable on the date of his or her death,
by the Employee's estate, personal representative or beneficiary to
whom this option has been assigned pursuant to Section 10, at any time
within 180 days after the date of death, but not later than the
scheduled expiration date.
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(b) DISABILITY. If the Employee ceases to be employed by
the Company and all Related Corporations by reason of his or her
disability (as defined in the Plan), this option may be exercised, to
the extent otherwise exercisable on the date of the termination of his
or her employment, at any time within 180 days after such termination,
but not later than the scheduled expiration date.
(c) EFFECT OF TERMINATION. At the expiration of the
180-day period provided in paragraphs (a) or (b) of this Section 5 or
the scheduled expiration date, whichever is the earlier, this option
shall terminate (and shall no longer be exercisable) and the only
rights hereunder shall be those as to which the option was properly
exercised before such termination.
6. PARTIAL EXERCISE. This option may be exercised in part at any
time and from time to time within the above limits, except that this option may
not be exercised for a fraction of a share unless such exercise is with respect
to the final installment of stock subject to this option and cash in lieu of a
fractional share must be paid, in accordance with Paragraph 13(G) of the Plan,
to permit the Employee to exercise completely such final installment. Any
fractional share with respect to which an installment of this option cannot be
exercised because of the limitation contained in the preceding sentence shall
remain subject to this option and shall be available for later purchase by the
Employee in accordance with the terms hereof.
7. PAYMENT OF PRICE. (a) The option price shall be paid in the
following manner:
(i) in cash or by check;
(ii) subject to Section 7(b) below, by delivery of shares
of the Company's Common Stock having a fair market
value (as determined by the Committee) equal as of
the date of exercise to the option price;
(iii) by delivery of an assignment satisfactory in form and
substance to the Company of a sufficient amount of
the proceeds from the sale of the Option Shares and
an instruction to the broker or selling agent to pay
that amount to the Company; or
(iv) by any combination of the foregoing.
(b) LIMITATIONS ON PAYMENT BY DELIVERY OF COMMON STOCK.
If the Employee delivers Common Stock held by the Employee (the "Old
Stock") to the Company in full or partial payment of the option price,
and the Old Stock so delivered is subject to restrictions or
limitations imposed by agreement between the Employee and the Company,
an equivalent number of Option Shares shall be subject to all
restrictions and limitations applicable to the Old Stock to the extent
that the Employee paid for the Option Shares by delivery of Old Stock,
in addition to any restrictions or limitations imposed by this
Agreement. Notwithstanding the foregoing, the Employee may not pay
any part of the exercise price hereof by transferring Common Stock to
the Company
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unless such Common Stock has been owned by the Employee free of any
substantial risk of forfeiture for at least six months.
8. RESTRICTIONS ON RESALE. Option Shares may be of an illiquid
nature and may be deemed to be "restricted securities" for purposes of the
Securities Act of 1933, as amended (the "Securities Act"). Accordingly, such
shares may be required to be sold in compliance with the registration
requirements of the Securities Act or an exemption therefrom.
9. METHOD OF EXERCISING OPTION. Subject to the terms and
conditions of this Agreement, this option may be exercised by written notice to
the Company at its principal executive office, or to such transfer agent as
the Company shall designate. Such notice shall state the election to exercise
this option and the number of Option Shares for which it is being exercised and
shall be signed by the person or persons so exercising this option. Such
notice shall be accompanied by payment of the full purchase price of such
shares, and the Company shall deliver a certificate or certificates
representing such shares as soon as practicable after the notice shall be
received. Such certificate or certificates shall be registered in the name of
the person or persons so exercising this option (or, if this option shall be
exercised by the Employee and if the Employee shall so request in the notice
exercising this option, shall be registered in the name of the Employee and
another person jointly, with right of survivorship). In the event this option
shall be exercised, pursuant to Section 5 hereof, by any person or persons
other than the Employee, such notice shall be accompanied by appropriate proof
of the right of such person or persons to exercise this option.
10. OPTION NOT TRANSFERABLE. This option is not transferable or
assignable except by will or by the laws of descent and distribution. During
the Employee's lifetime only the Employee can exercise this option.
11. NO OBLIGATION TO EXERCISE OPTION. The grant and acceptance of
this option imposes no obligation on the Employee to exercise it.
12. NO OBLIGATION TO CONTINUE EMPLOYMENT. Neither the Plan, this
Agreement, nor the grant of this option imposes any obligation on the Company
or any Related Corporation to continue the Employee in employment.
13. NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE. The Employee shall
have no rights as a stockholder with respect to the Option Shares until such
time as the Employee has exercised this option by delivering a notice of
exercise and has paid in full the purchase price for the shares so exercised in
accordance with Section 9. Except as is expressly provided in the Plan with
respect to certain changes in the capitalization of the Company, no adjustment
shall be made for dividends or similar rights for which the record date is
prior to such date of exercise.
14. CAPITAL CHANGES AND BUSINESS SUCCESSIONS. The Plan contains
provisions covering the treatment of options in a number of contingencies such
as stock splits and mergers. Provisions in the Plan for adjustment with
respect to stock subject to options and the related
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provisions with respect to successors to the business of the Company are hereby
made applicable hereunder and are incorporated herein by reference.
15. EARLY DISPOSITION. The Employee agrees to notify the Company
in writing immediately after the Employee transfers any Option Shares, if such
transfer occurs on or before the later of (a) the date two years after the date
of this Agreement or (b) the date one year after the date the Employee acquired
such Option Shares. The Employee also agrees to provide the Company with any
information concerning any such transfer required by the Company for tax
purposes.
16. WITHHOLDING TAXES. If the Company or any Related Corporation
in its discretion determines that it is obligated to withhold any tax in
connection with the exercise of this option, or in connection with the transfer
of, or the lapse of restrictions on, any Common Stock or other property
acquired pursuant to this option, the Employee hereby agrees that the Company
or any Related Corporation may withhold from the Employee's wages or other
remuneration the appropriate amount of tax. At the discretion of the Company
or Related Corporation, the amount required to be withheld may be withheld in
cash from such wages or other remuneration or in kind from the Common Stock or
other property otherwise deliverable to the Employee on exercise of this
option. The Employee further agrees that, if the Company or any Related
Corporation does not withhold an amount from the Employee's wages or other
remuneration sufficient to satisfy the withholding obligation of the Company or
Related Corporation, the Employee will make reimbursement on demand, in cash,
for the amount underwithheld.
17. LOCK-UP AGREEMENT. The Employee agrees that in connection
with an underwritten public offering of Common Stock, upon the request of the
Company or the principal underwriter managing such public offering, the Option
Shares may not be sold, offered for sale or otherwise disposed of without the
prior written consent of the Company or such underwriter, as the case may be,
for at least ninety (90) days after the effectiveness of the registration
statement filed in connection with such offering, or such longer period of time
as the Board of Directors may determine if all of the Company's directors and
officers agree to be similarly bound.
18. ARBITRATION. Any dispute, controversy, or claim arising out
of, in connection with, or relating to the performance of this Agreement or its
termination shall be settled by arbitration in the State of Mississippi,
pursuant to the rules then obtaining of the American Arbitration Association.
Any award shall be final, binding and conclusive upon the parties and a
judgment rendered thereon may be entered in any court having jurisdiction
thereof.
19. PROVISION OF DOCUMENTATION TO EMPLOYEE. By signing this
Agreement the Employee acknowledges receipt of a copy of this Agreement and a
copy of the Plan.
20. MISCELLANEOUS.
(a) NOTICES. All notices hereunder shall be in writing
and shall be deemed given when sent by certified or registered mail,
postage prepaid, return receipt requested,
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to the address set forth below. The addresses for such notices may be
changed from time to time by written notice given in the manner
provided for herein.
(b) ENTIRE AGREEMENT; MODIFICATION. This Agreement
constitutes the entire agreement between the parties relative to the
subject matter hereof, and supersedes all proposals, written or oral,
and all other communications between the parties relating to the
subject matter of this Agreement. This Agreement may be modified,
amended or rescinded only by a written agreement executed by both
parties.
(c) SEVERABILITY. The invalidity, illegality or
unenforceability of any provision of this Agreement shall in no way
affect the validity, legality or enforceability of any other
provision.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, subject to the limitations set
forth in Section 10 hereof.
(e) GOVERNING LAW. This Agreement shall be governed by
and interpreted in accordance with the laws of the State of Delaware,
without giving effect to the principles of the conflicts of laws
thereof.
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IN WITNESS WHEREOF, the Company and the Employee have caused this
instrument to be executed as of the date first above written.
GULF SOUTH MEDICAL SUPPLY, INC.
Xxx Xxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
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EMPLOYEE
(Employee) By:
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Print Name of Employee
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Street Address Title
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City State Zip Code
