REDACTED - OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE COMMISSION AND IS
DENOTED HEREIN BY *****.
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into
effective as of November 1, 1999 by and between C3, Inc., a North Carolina
company, DBA Xxxxxxx & Xxxxxxx, with its principal office at 0000 Xxxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxxxxxx, Xxxxx Xxxxxxxx, 00000 (the "Company), and
Xxxxx Xxxxx, an individual currently residing at 000 Xxxxxxx Xxxxx, Xxxxxx,
Xxxxx Xxxxxxxx, 00000 ("Employee").
Statement of Purpose
The Company wishes to obtain the services of Employee on the terms and
conditions and with the benefits set forth in this Agreement. Employee desires
to be employed by the Company on such terms and conditions and to receive such
additional consideration as set out herein.
Therefore, in consideration of the mutual covenants contained in this
Agreement, the grant of certain options to purchase common stock of the Company
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and Employee agree as follows:
1. Employment. The Company hereby agrees to employ Employee, and
Employee hereby accepts such employment, on the terms and conditions set forth
in this Agreement.
2. Term of Employment. The term of Employee's employment under this
Agreement shall commence as of the date of this Agreement and shall continue on
and through October 31, 2002. This Agreement shall automatically, at the
expiration of the then current term, renew for successive one year terms, unless
terminated by either party upon no less than 30 days prior written notice to the
other, or is otherwise terminated pursuant to Paragraph 7.
3. Position and Duties. The Employee shall serve as Vice President of
Sales of the Company. As such, it is understood and agreed that Employee lives
in Oxford, North Carolina and shall not be required to change his place of
residence to fulfill the duties of his employment. Employee will, under the
direction of the President and CEO of the Company, faithfully and to the best of
his ability perform the duties as set out in his job description on Exhibit A
hereto and such additional duties as may be reasonably assigned by the President
and Board of Directors. Employee agrees to devote his entire working time,
energy and skills to the Company while so employed.
4. Compensation and Benefits. Employee shall receive compensation and
benefits for the services performed for the Company under this Agreement as
follows:
(a) Base Salary. Employee shall receive a base salary of
$125,000, payable in regular and equal monthly installments ("Base
Salary"); provided, however, that the Base Salary shall be adjusted as
per the description and example shown on Exhibit B hereto. The
adjustment shall occur after the annual audit of the companies books is
concluded by the company's outside auditors, with the first adjustment
occurring in 2001.
(b) Employee Benefits. Employee shall receive such benefits as
are made available to the other employees of the Company, including,
but not limited to, life, medical and disability insurance, retirement
benefits and such vacation as is provided to the other employees of the
Company (the "Employee Benefits").
(c) Incentive Compensation. Employee shall participate in such
incentive plans as may be approved by the Board of Directors from
time-to-time for the officers of the Company. Additionally, the
Employee shall receive a "commission" of $0.30 per carat of moissanite
sold by the Company in the twenty four target US Media markets, as
defined by the Xxxxxxx Rating Service, identified on Exhibit C, list
"B", to this agreement and $0.10 per carat of moissanite sold by the
Company in any other markets. Exhibit C is incorporated herein by
reference as if it were a part hereof. Such commissions shall be paid
quarterly, after the review of the Company's books by the outside
auditors for the quarter then ending. This provision shall be in effect
until the company achieves it's sales objective for the year 2000 or
2001, or 2002, as approved by the Company's Board of Directors. Upon
that event, the commissions shall become $0.20 per carat on all sales
irrespective of the market where sold.
(d) Employee Stock Option Participation. Employee shall be
granted, as additional consideration for entering into this Agreement,
an option to purchase 60,000 shares of the Company's common stock in
accordance with the terms and conditions of the Employee Stock Option
Agreement annexed hereto as Exhibit D and incorporated herein by
reference as if it were a part hereof. Employee shall receive options
to purchase an additional 40,000 shares of the shares of the common
stock of the Company if increased distribution goals are met. Those
options can be earned and granted according to the following schedule.
(i) If within six (6) months of the date of this agreement, 8,000
options will be earned and granted if the number of retailers in the
targeted markets identified on Exhibit C, list "A" domestic markets
doubles from the current ** to ***. An additional 2,000 options will be
earned and granted if at least 25% of the retailers added are "AGS" or
"AGTA" or similar retailers; (ii) if within 12 months, 8,000 options
will be earned and granted if the total number of retail outlets in the
targeted markets (Exhibit C, List B) reaches ***. An additional 2,000
options will be earned and granted if at least 25% of the retailers
added are "AGS" or "AGTA" or similar retailers; (iii) if within 18
months, 8,000 options will be earned and granted if the Company has ***
retail stores in the 24 targeted markets, (Exhibit C, List B). An
additional 2,000 options will be earned and granted 25% of those added
are "AGS" or "AGTA" or similar retailers; (iv) if within 30 months
10000 options will be earned and granted if the total number of
retailers in the targeted markets (Exhibit C, List B) becomes ***; or
in the event the options set out above are not earned. (v) Employee
shall receive options to purchase an additional 20,000 shares of the
shares of the common stock
of the Company if within twelve (12) months from the effective date of
this Agreement the number of retail outlets in the United States
increase by one hundred percent, or to ***, from the current level of
*** such retail outlets. Further, Employee shall receive options to
purchase 20,000 shares of the common stock of the Company within thirty
(30) months from the effective date of this Agreement if the number of
retail outlets in the United States increase by three hundred percent,
or to ***, from the current level of *** such retail outlets. The
granting of the second 20,000 options described herein shall not be
conditional upon the grant of the initial 20,000 options. In no event
may the number of options earned pursuant to this paragraph exceed
40,000. All references to "retailers" in this paragraph shall mean
retail distribution outlets actively selling Xxxxxxx & Xxxxxxx created
moissanite. All references to "AGS" retailers in this document, shall
mean retailers which are members of the industry trade group, the
American Gem Society, and all references to "AGTA" in this document,
shall mean retailers which are members of the industry trade group, the
American Gem Trade Association. Similar retailers shall mean retailers
that conduct their business to the ethical standards of either AGS or
AGTA member retailers, but are not members of either association.
All options which may be earned under the incentive to open additional
retail outlets for the Company's products shall be granted when the targeted
levels of retail outlets is achieved, as the case may be, and shall be vested
when granted. The price of all such options shall be the publicly traded stock
price at closing on the day proceeding the date the options are granted.
5. Reimbursement of Expenses. The Company shall reimburse Employee for
all reasonable out-of-pocket expenses incurred by Employee specifically and
directly related to the performance by Employee of the services under this
Agreement.
6. Withholding. The Company may withhold from any payments or benefits
under this Agreement all federal, state or local taxes or other amounts as may
be required pursuant to applicable law, government regulation or ruling.
7. Termination of Employment.
(a) Death of Employee. If the Employee shall die during the
Term, this Agreement and the employment relationship hereunder will
automatically terminate on the date of death, which date shall be the last day
of the Term.
(b) Termination for Just Cause. The Company shall have the
right to terminate the Employee's employment under this Agreement for "Just
Cause". Termination for "Just Cause" shall mean termination for Employee's gross
incompetence, failure, after written notice, to perform stated duties covered by
the Employee's written job description (as in effect as the effective date of
this Agreement), material breach of a fiduciary duty related to the Employee's
job description and involving personal gain, willful violation of a material
written company policy of general applicability, unethical business practices in
connection with the Company's business, conviction of a felony or misdemeanor
involving moral turpitude, theft of Company assets or disability or
material breach of any other provision of this Agreement, provided that the
Employee has received written notice from the Company of such material breach
and such breach remains uncured thirty days after the delivery of such notice.
For purposes of this subsection, the term "disability" means the inability of
Employee, due to the condition of his physical, mental or emotional health, to
satisfactorily perform the duties of his employment hereunder for a continuous
three month period; provided further that if the Company furnishes long term
disability insurance for the Employee, the term "disability" shall mean that
continuous period sufficient to allow for the long term disability payments to
commence pursuant to the Company's long term disability insurance policy. In the
event the Employee's employment under this Agreement is terminated for Just
Cause, the Employee shall have no right to receive compensation or other
benefits under this Agreement for any period after such termination.
(c) Termination Without Cause. The Company may terminate the
Employee's employment other than for "Just Cause," as described in Subsection
(b) above, at any time upon written notice to the Employee, which termination
shall be effective immediately. In the event the Company terminates Employee
pursuant to this Subsection (c), (i) the Employee will receive the highest
amount of the annual cash compensation (including cash bonuses and other
cash-based benefits, including for these purposes amounts earned or payable
whether or not deferred) received from the Company during any of the five
calendar years immediately preceding such termination ("Termination
Compensation") in each year until the end of the Term, so long as the Employee
complies with Sections 8, 9 and 10 of the Agreement and (ii) the Company shall
take such action as may be required to vest any unvested benefits of the
Employee under any employee stock-based or other benefit plan or arrangement.
Such amounts shall be payable at the times such amounts would have been paid in
accordance with Section 4. In addition, Employee shall continue to participate
in the same group hospitalization plan, health care plan, dental care plan, life
or other insurance or death benefit plan, and any other present or future
similar group employee benefit plan or program for which officers of the Company
generally are eligible, on the same terms as were in effect prior to Employee's
termination, either under the Company's plans or comparable coverage, for all
periods Employee receives Termination Compensation. Notwithstanding anything in
this Agreement to the contrary, if Employee breaches Sections 8, 9 or 10 of this
Agreement, the Employee will not be entitled to receive any further compensation
or benefits pursuant to this Section 7(c).
(d) Change of Control Situations. In the event of a Change of
Control of Company at any time after the date hereof, Employee may voluntarily
terminate employment with Company up until twelve (12) months after the Change
of Control for "Good Reason" and, subject to Section 7(f), (y) be entitled to
receive in a lump sum (i) any compensation due but not yet paid through the date
of termination and (ii) in lieu of any further salary payments from the date of
termination to the end of the then existing term, an amount equal to the
Termination Compensation times 2.99, and (z) shall continue to participate in
the same group hospitalization plan, health care plan, dental care plan, life or
other insurance or death benefit plan, and any other present or future similar
group employee benefit plan or program for which officers of the Company
generally are eligible, or comparable plans or coverage, for a period of two
years following termination of employment by the Employee, on the same terms as
were in effect either (A) at the date of such
termination, or (B) if such plans and programs in effect prior to the Change of
Control of Company are, considered together as a whole, materially more generous
to the officers of Company, then at the date of the Change of Control. Any
equity based incentive compensation (including but not limited to stock options,
SARs, etc.) shall fully vest and be immediately exercisable in full upon a
Change in Control, not withstanding any provision in any applicable plan. Any
such benefits shall be paid by the Company to the same extent as they were so
paid prior to the termination or the Change of Control of Company.
"Good Reason" shall mean the occurrence of any of the
following events without the Employee's express written consent:
(i) the assignment to the Employee of duties
inconsistent with the position and status of the Employee with
the Company immediately prior to the Change of Control;
(ii) a reduction by the Company in the Employee's pay
grade or base salary as then in effect, or the exclusion of
Employee from participation in Company's benefit plans in
which he previously participated as in effect at the date
hereof or as the same may be increased from time to time
during the Term, or Company's failure to increase (within
twelve (12) months of the Employee's last increase in base
salary) the Employee's base salary in an amount which at least
equals, on a percentage basis, the average percentage increase
in base salary for all executives entitled to participate in
Company's executive incentive plans for which Employee was
eligible in the preceding 12 months; or
(iii) an involuntary relocation of the Employee more
than 50 miles from the location where the Employee worked
immediately prior to the Change in Control or the breach by
the Company of any material provision of this Agreement; or
(iv) any purported termination of the employment of
Employee by Company which is not effected in accordance with
this Agreement.
A "Change of Control" shall be deemed to have occurred if (i)
any person or group of persons (as defined in Section 13(d) and 14(d) of the
Securities Exchange Act of 1934) together with its affiliates, excluding
employee benefit plans of Company, becomes, directly or indirectly, the
"beneficial owner" (as defined in Rule 13d-3 promulgated under the Securities
Exchange Act of 1934) of securities of Company representing 20% or more of the
combined voting power of Company's then outstanding securities; or (ii) during
the then existing term of the Agreement, as a result of a tender offer or
exchange offer for the purchase of securities of Company (other than such an
offer by the Company for its own securities), or as a result of a proxy contest,
merger, consolidation or sale of assets, or as a result of any combination of
the foregoing, individuals who at the beginning of any year period during such
term constitute the Company's Board of Directors, plus new directors whose
election by Company's shareholders is approved by a vote of at least two-thirds
of the outstanding voting shares of the Company, cease for any reason during
such year period
to constitute at least two-thirds of the members of such Board of Directors; or
(iii) the shareholders of the Company approve a merger or consolidation of the
Company with any other corporation or entity regardless of which entity is the
survivor, other than a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or being converted into voting
securities of the surviving entity) at least 60% of the combined voting power of
the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation; or (iv) the shareholders of the
Company approve a plan of complete liquidation or winding-up of the Company or
an agreement for the sale or disposition by the Company of all or substantially
all of the Company's assets; or (v) any event which the Company's Board of
Directors determines should constitute a Change of Control.
(e) Employee's Right to Payments. In receiving any payments
pursuant to this Section 7, Employee shall not be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Employee hereunder, and such amounts shall not be reduced or terminated
whether or not the Employee obtains other employment.
(f) Reduction in Agreement Payments. Notwithstanding anything
in this Agreement to the contrary, if any of the payments provided for under
this Agreement (the "Agreement Payments"), together with any other payments that
the Employee has the right to receive (such other payments together with the
Agreement Payments are referred to as the "Total Payments"), would constitute a
"parachute payment" as defined in Section 280G(b)(2) of the Internal Revenue
Code of 1986, as amended (the "Code") (a "Parachute Payment"), the Agreement
Payments shall be reduced by the smallest amount necessary so that no portion of
such Total Payments would be Parachute Payments. In the event the Company shall
make an Agreement Payment to the Employee that would constitute a Parachute
Payment, the Employee shall return such payment to the Company (together with
interest at the rate set forth in Section 1274(b)(2)(B) of the Code). For
purposes of determining whether and the extent to which the Total Payments
constitute Parachute Payments, no portion of the Total Payments the receipt of
which Employee has effectively waived in writing shall be taken into account.
8. Covenant Not to Compete. Employee agrees that during his employment
with the Company and for a period of one (1) year following the termination of
his employment with the Company, for whatever reason:
(a) Employee shall not, directly or indirectly, own any
interest in, manage, operate, control, be employed by, render advisory
services to, or participate in the management or control of any
business that operates in the same business as the Company, which
Employee and the Company specifically agree as the business of
fabricating (wafering, preforming and faceting), marketing and
distributing moissanite gemstones or other diamond simulants to the gem
and jewelry industry (the "Business"), unless Employee's duties,
responsibilities and activities for and on behalf of such other
business are not related in any way to such other business's products
which are in competition with the Company's products. For purposes of
this section, "competition with the Company" shall
mean competition for customers in the United States and in any country
in which the Company is selling the Company's products at the time of
termination. Employee's ownership of less than one percent of the
issued and outstanding stock of a corporation engaged in the Business
shall not by itself be deemed to be a violation of this Agreement.
Employee recognizes that the possible restriction on his activities
which may occur as a result of his performance of his obligations under
Paragraph 8(a) are substantial, but that such restriction is required
for the reasonable protection of the Company.
(b) Employee shall not, directly or indirectly, influence or
attempt to influence any customer of the Company to discontinue its
purchase of any product of the Company which is manufactured or sold by
the Company at the time of termination of Employee's employment or to
divert such purchases to any other person, firm or employer.
(c) Employee shall not, directly or indirectly, interfere
with, disrupt or attempt to disrupt the relationship, contractual or
otherwise, between the Company and any of its suppliers.
(d) Employee shall not, directly or indirectly, solicit any
employee of the Company to work for any other person, firm or employer.
9. Confidentiality. In the course of his employment with the Company,
Employee will have access to confidential information, records, data, customer
lists, lists of product sources, specifications, trade secrets and other
information which is not generally available to the public and which the Company
and Employee hereby agree is proprietary information of the Company
("Confidential Information"). During and after his employment by the Company,
Employee shall not, directly or indirectly, disclose the Confidential
Information to any person or use any Confidential Information, except as is
required in the course of his employment under this Agreement. All Confidential
Information as well as records, files, memoranda, reports, plans, drawings,
documents, models, equipment and the like, including copies thereof, relating to
the Company's business, which Employee shall prepare or use or come into contact
with during the course of his employment, shall be and remain the Company's sole
property, and upon termination of Employee's employment with the Company,
Employee shall return all such materials to the Company.
10. Proprietary Information. Employee shall assign to the Company, its
successors or assigns, all of Employee's rights to copyrightable works and
inventions which, during the period of Employee's employment by the Company or
its successors in business, Employee makes or conceives, either solely or
jointly with others, relating to any subject matter with which Employee's work
for the Company is or may be concerned ("Proprietary Information"). Employee
shall promptly disclose in writing to the Company such copyrightable works and
inventions and, without charge to the Company, to execute, acknowledge and
deliver all such further papers, including applications for copyrights and
patents for such copyrightable works and inventions, if any, in all countries
and to vest title thereto in the Company, its successors, assigns or nominees.
Upon termination of Employee's employment hereunder, Employee shall return to
the Company or its
successors or assigns, as the case may be, any Proprietary Information. The
obligation of Employee to assign the rights to such copyrightable works and
inventions shall survive the discontinuance or termination of this Agreement for
any reason.
11. Entire Agreement. This Agreement contains the entire agreement of
the parties with respect to Employee's employment by the Company and supersedes
any prior agreements between them, whether written or oral.
12. Waiver. The failure of either party to insist in any one or more
instance, upon performance of the terms and conditions of this Agreement, shall
not be construed as a waiver or a relinquishment of any right granted hereunder
or of the future performance of any such term or condition.
13. Notices. Any notice to be given under this Agreement shall be
deemed sufficient if addressed in writing and delivered personally, by telefax
with receipt acknowledged, or by registered or certified U.S. mail to the
address first above appearing, or to such other address as a party may designate
by notice from time to time.
14. Severability. In the event that any provision of any paragraph of
this Agreement shall be deemed to be invalid or unenforceable for any reason
whatsoever, it is agreed such invalidity or unenforceability shall not affect
any other provision of such paragraph or of this Agreement, and the remaining
terms, covenants, restrictions or provisions in such paragraph and in this
Agreement shall remain in full force and effect and any court of competent
jurisdiction may so modify the objectionable provision as to make it valid,
reasonable and enforceable.
15. Amendment. This Agreement may be amended only by an agreement in
writing signed by each of the parties hereto.
16. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or breach thereof, shall be settled by arbitration in Raleigh,
North Carolina in accordance with the expedited procedures of the Rules of the
American Arbitration Association, and judgment upon the award may be rendered by
the arbitrator and may be entered in any court having jurisdiction thereof.
17. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of North Carolina. Each of the parties
hereto irrevocably submits to the exclusive jurisdiction of the courts located
in North Carolina for the purposes of any suit, action or other proceeding
contemplated hereby or any transaction contemplated hereby.
18. Benefit. This Agreement shall be binding upon and inure to the
benefit of and shall be enforceable by and against the Company, its successors
and assigns, and Employee, his heirs, beneficiaries and legal representatives.
It is agreed that the rights and obligations of Employee may not be delegated or
assigned except as may be specifically agreed to by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
C3, Inc.
By: _______________________________
Xxxxxx X. Xxxxxx, President
_______________________________
Xxxxx Xxxxx
Exhibit A
JOB DESCRIPTION
Vice President of Sales
SUMMARY
Develops the policies, procedures and objectives for sales of the Company's
products. Leads and directs the activities of the sales personnel. Continually
evaluates the Company's sales efforts and develops and implements programs to
strengthen the Company's sales efforts. Provides sales expertise to other
members of the Company's management team, and coordinates the Company's sales
efforts with other Company activities including but not limited to marketing and
manufacturing.
PRIMARY RESPONSIBILITIES
1. Directs activities of the sales function of the Company to achieve Company
objectives for sales volume and market penetration. Responsible for
advancing the Company's performance management system, especially in sales.
2. Directs activities of the sales function. This includes competitive
analysis, product and consumer research, establishing sales budgets and
quotas, product pricing and distribution.
3. Leads and directs activities of the Company's sales force and any
representatives and/or distributors of the Company's products. Provides
leadership, training (including coaching), management and sales support.
Coordinates field sales efforts to enhance ability of sales personnel to
work effectively and achieve goals.
4. Directs product and customer service activities. Responsible for
maintaining satisfactory customer perception of Company services and
products by working with the marketing staff to insure that the Company's
branding and positioning strategy is consistent with the Company's sales
activities.
5. Works closely with members of the management team, especially
manufacturing, to ensure that the product mix and availability is in synch
with customer demand.
6. Analyzes actual sales and marketing performance against budgeted sales
volume and market penetration levels.
7. Manages all sales promotion activities, including planning and executing
the Company's participation in industry trade shows. Responsible for the
coordination of all sales efforts with the marketing department and public
relations and advertising agencies of record.
8. Establishes and maintains contact with potential customers and actively
participates in the selling effort to support key accounts and with a high
level of sales.
9. Responsible for submitting annual projected sales forecast, including the
necessary product mix, and budget for inclusion in the Company's annual
business plan for approval by the Company's Board of Directors. Is
accountable for the execution of the sales plan as presented in the annual
business plan, which includes the management of the sales budgets for both
planned sales income and planned sales expenses.
10. Presents updates to the Board of Directors during quarterly meetings and
management briefings.
11. Performs such activities consistent with the position of Vice President of
Sales as may be reasonably delegated by the CEO, COO, President or the
Board of Directors of the Company.
Exhibit B
Base Salary Adjustment
Base Salary to increase at twenty five percent (25%) of the rate of
growth of the company's top line net sales growth. The calculation will be done
on the calendar and fiscal year ending December 31 of each year, beginning with
the comparison between 1999 and 2000. The salary adjustment will be effective on
January 1 of each year of the contract period, with the first adjustment
occurring effective January 1, 2001.
Example:
1. 1999/2000 Base Salary equals $125,000.00
2. Adjustment percentage equals 25%
3. 1999 Net Sales equals $12,500,000.00
4. 2000 Net Sales equals $30,000,000.00
5. Company Sales growth equals 140% (#4 minus #3, divided by #3)
6. The salary adjustment becomes 35%. (#5 (140%) times #2 (25%))
7. 2001 Base salary becomes $168,750.00. (#1 times #6, plus #1)
EXHIBIT C
Targeted United States Media Markets*
List A List B
New York New York
Washington DC Washington DC
Atlanta Atlanta
Charlotte Charlotte
Miami Miami
Dallas Dallas
Houston Houston
Raleigh/Durham Baltimore
Los Angeles Los Angeles
San Diego San Diego
San Francisco San Francisco
Greensboro/Winston Salem Boston
Philadelphia
Cincinnati
Cleveland
Detroit
Chicago
Denver
Phoenix
New Orleans
Las Vegas
Minneapolis
Orlando
Seattle
* Media markets as defined by the Xxxxxxx Rating Service
EXHIBIT D
1997 OMNIBUS STOCK PLAN
OF C3, INC.
(EMPLOYEE OPTION AGREEMENT)
THIS AGREEMENT (the "Agreement"), made the 1st day of November 1999,
between C3, INC., a North Carolina corporation doing business as Xxxxxxx &
Xxxxxxx (the "Corporation"), and Xxxxx Xxxxx an employee of the Corporation or a
related corporation (the "Optionee");
R E C I T A L S :
In furtherance of the purposes of the 1997 Omnibus Stock Plan of C3,
Inc., as it may be hereafter amended (the "Plan"), the Corporation and the
Optionee hereby agree as follows:
1. The rights and duties of the Corporation and the Optionee under this
Agreement shall in all respects be subject to and governed by the provisions of
the Plan, a copy of which is delivered herewith or has been previously provided
to the Optionee and the terms of which are incorporated herein by reference.
2. The Corporation hereby grants to the Optionee pursuant to the Plan,
as a matter of separate inducement and agreement in connection with his
employment or service to the Corporation, and not in lieu of any salary or other
compensation for his services, the right and Option (the "Option") to purchase
all or any part of an aggregate of Sixty Thousand (60,000) shares (the "shares")
of the Common Stock of the Corporation, at the purchase price of Nine and 75/100
Dollars ($9.75) per share. The option to purchase the shares shall be designated
as an Incentive Option. To the extent that any Option is designated as an
Incentive Option and such Option does not qualify as an Incentive Option, it
shall be treated as a Nonqualified Option. Except as otherwise provided in the
Plan, the Option will expire if not exercised in full before October 31, 2009.
3. The Option shall become exercisable on the date or dates set forth
on Schedule A attached hereto. To the extent that an Option which is exercisable
is not exercised, such Option shall accumulate and be exercisable by the
Optionee in whole or in part at any time prior to expiration of the Option. The
minimum number of shares that may be purchased under the Option at one time
shall be ten (10). Upon the exercise of an Option in whole or in part, the
Optionee shall pay the Option price to the Corporation in accordance with the
provisions of Section 6 of the Plan, and the Corporation shall as soon
thereafter as practicable deliver to the Optionee a certificate or certificates
for the shares purchased.
4. Nothing contained in this Agreement or the Plan shall require the
Corporation or a related corporation to continue to employ the Optionee for any
particular period of time, nor shall it require the Optionee to remain in the
employ of the Corporation or such related corporation for any particular period
of time. Except as otherwise expressly provided in the Plan, all rights of the
Optionee under the Plan with respect to the unexercised portion of his Option
shall terminate upon termination of the employment of the Optionee with the
Corporation or a related corporation.
5. This Option shall not be transferable other than by will or the laws
of intestate succession or pursuant to a qualified domestic relations order.
This Option shall be exercisable during the Optionee's lifetime only by the
Optionee.
6. This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective executors, administrators,
next-of-kin, successors and assigns.
7. Except as otherwise provided in the Plan or herein, this Agreement
shall be construed and enforced according to the laws of the State of North
Carolina.
IN WITNESS WHEREOF, this Agreement has been executed in behalf of the
Corporation and by the Optionee on the day and year first above written.
C3, INC.
By:________________________________
Xxxxxx X. Xxxxxx
President
Attest:
________________________________
Xxxx X. Xxxx
Secretary
[Corporate Seal]
OPTIONEE
_________________________________(SEAL)
Xxxxx Xxxxx
1997 OMNIBUS STOCK PLAN
OF C3, INC.
(EMPLOYEE OPTION AGREEMENT)
SCHEDULE A
Date Option granted: November 1, 1999
Date Option expires: October 31, 2009
Number of shares subject to Option: 60,000
Option price (per share): $9.75
Date Installment Percentage of Incentive or
First Exercisable Shares In Installment Nonqualified Stock Option
--------------------- ------------------------ -------------------------
October 28, 2000 20,000 shares or 33 1/3% Incentive Option
October 28, 2001 20,000 shares or 33 1/3% Incentive Option
October 28, 2002 20,000 shares or 33 1/3% Incentive Option
16
