Exhibit 10.3
MODIFICATION AGREEMENT
THIS AGREEMENT, made and entered into this _____ day of
____________________________, 1996, by and between Northland Cranberries,
Inc. (Company) and _________________________ (Optionee);
R E C I T A L S
A. On _______________________, 1996
______________________________ was granted a stock option under the
Company's 1987 Stock Option Plan to purchase _________________________
shares of the Company's Class A Common Stock at an exercise price of $
___________ per share, together with a tax offset bonus calculated for the
number of shares subject to said option granted (the "Option"), and
otherwise under the terms and conditions set forth in that certain Stock
Option Agreement (the "Option Agreement"). A copy of the Option Agreement
is attached hereto and incorporated herein by reference marked as Exhibit
A.
B. The Company desired to terminate the tax offset bonus
effective as of the beginning of its current fiscal year and to establish
its obligation for such bonus at a fixed and determinable amount.
Optionee was willing to agree to cap the maximum amount of the tax offset
bonus at the amount payable upon an exercise of the option in
consideration of the amount of such tax offset bonus begin fixed at such
amount, and other good and valuable consideration.
C. The closing price for the Class A Common Stock on
____________________, ___________________, 1995, was $ __________ per
share and the Company and Optionee have agreed to use that price to fix
the amount of the tax offset bonus payable to Optionee upon exercise of
the options granted pursuant to the Agreement.
The parties have agreed to modify that Option Agreement in the
following manner.
NOW, THEREFORE, in consideration of the above and other valuable
consideration and of the covenants and agreements herein set forth,
receipt and adequacy of which is hereby acknowledged, the parties agree as
follows:
1. Amendment of the first paragraph of Section 8. The first
paragraph of Section 8 of the Option Agreement shall be amended in its
entirety to read as follows:
8. Upon exercise of an option with respect
to which a tax offset bonus has been
granted, the Optionee shall be entitled to
receive from the Company an amount in cash
determined by multiplying the Bonus Factor
(as hereinafter defined) by the excess of
(i) an amount determined by multiplying $
_______ times the number of shares of Common
Stock for which the Option is exercised over
(ii) the option price for such shares.
2. Amendment of Section 9. Section 9 of the Option Agreement
shall be amended in its entirety to read as follows:
9. The tax offset bonus shall be payable to
the Optionee within 15 days following
exercise of an Option with respect to which
such bonus relates.
3. Definitions. Any and all initially capitalized terms used
herein shall have the meanings ascribed to them in the Option Agreement
unless specifically defined herein.
4. No Other Amendment. All other terms and conditions of the
Option Agreement shall remain with full force and effect except as
modified herein.
5. Binding Effect. This Modification Agreement shall be
binding on the heirs, personal representatives and successors of the
parties hereto.
OPTIONEE NORTHLAND CRANBERRIES, INC.
_______________________ ___________________________________
Title: ____________________________
NORTHLAND CRANBERRIES, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT, made and entered into as of this lst day of
January, 1989 (the "Grant Date"), by and between NORTHLAND CRANBERRIES,
INC., a Wisconsin corporation (the "Company"), and Xxxx Xxxxxxx (the
"Optionee").
W I T N E S S E T H:
WHEREAS, the Company has adopted the Northland Cranberries, Inc.
1987 Stock Option Plan, as amended, (the "Plan"), the terms of which, to
the extent not stated herein, are specifically incorporated by reference
in this Agreement, and
WHEREAS, the purpose of the Plan is to permit options to
purchase shares of the Company's Class A Common Stock, $.01 par value
("Common Stock"), to be granted to certain key employees of the Company,
and
WHEREAS, the Optionee is now employed by the Company in a key
capacity, and the Company desires him to remain in such employ, and to
secure or increase his stock ownership in the Company in order to increase
his incentive and personal interest in the welfare of the Company:
NOW, THEREFORE, in consideration of the premises and of the
covenants and agreements herein set forth, the parties hereby mutually
covenant and agree as follows:
1. Subject to the terms and conditions set forth herein, the
Company grants to the Optionee the option to purchase from the company all
or any part of the aggregate amount of ___________________ shares of
Common Stock of the Company (hereinafter referred to as the "Optioned
Shares"; the option to purchase the Optioned Shares is referred to as the
"Option").
2. The price to be paid for the Optioned Shares shall be $
________ per share, which has been determined by the Board of Directors of
the Company (the "Board") to be not less than 100% of the fair market
value of a share of Common Stock on the Grant Date.
3. The Option may be exercised by the Optionee while in the
employ of the Company, in whole, or in part from time to time, during the
period beginning on the Grant Date and ending January 1, 1999, but only in
accordance with the following schedule:
Elapsed Number of Cumulative Percentage of
Years After Shares Subject to Option
Grant Date Which May be Purchased
Less Than One Year 0%
One Year 20%
Two Years 40%
Three Years 60%
Four Years 80%
Five Years 100%
4. The Option may be exercised only by written notice to the
Company by the Optionee of the Optionee's intent to exercise the Option,
delivered to the Secretary of the Company at its office at Wisconsin
Rapids, Wisconsin, specifying the number of Optioned Shares in respect to
which the Option is being exercised, accompanied by payment for such
shares: (a) in cash or its equivalent; (b) by delivering previously
acquired shares of Common Stock valued at their fair market value at the
time of exercise as determined by the Board consistent with the method of
valuation set forth in Section 5 of the Plan; or (c) by any combination of
(a) and (b). For purposes of (b) and (c) above, the term "previously
acquired shares of Common Stock" shall only include Common Stock owned by
the Optionee prior to the exercise of the Option and shall not include
shares of Common Stock which are being acquired pursuant to the exercise
of said Option. Upon payment of the purchase price, the Optioned Shares
acquired pursuant to the exercise of the Option shall be fully paid and
nonassessable by the Company, except as provided in Section 180.40(6) of
the Wisconsin Statutes.
5. The Option shall not be transferable by the Optionee
otherwise than by will or the laws of descent and distributions, and may
be exercised during the life of the Optionee only by the Optionee.
6. (a) In the event that the Optionee's employment with the
Company is terminated for any reason, other than termination of the
Optionee's employment by the Company "for cause", the Option, to the
extent not theretofore exercised but then permitted under the percentage
limitations of Paragraph 3 hereof, may be exercised by the Optionee or by
his legal representative at any time within thirty (30) days after the
date such termination of employment, but in no event later than ten years
after the Grant Date.
(b) In the event the Optionee's employment is terminated by the
Company "for cause", the Option, to the extent not theretofore exercised,
shall terminate immediately and shall not be exercisable following such
termination of employment.
For purposes of this Paragraph 6, termination by the Company
"for cause" shall mean any termination of the Optionee by reason of any
action or omission on the part of the Optionee which is contrary to the
interests of the Company or not in the interests of the Company.
7. Subject to the terms and conditions of the Plan and this
Agreement, the Company grants to the Optionee a tax offset bonus with
respect to 2,000 of the Optioned Shares.
8. Upon exercise of an Option with respect to which a tax
offset bonus has been granted, the Optionee shall be entitled to receive
from the Company an amount in cash determined by multiplying the excess of
the fair market value of the shares of Common Stock for which the Option
is exercised over the option price of such shares by the Bonus Factor, as
hereinafter defined. The fair market value of such shares of Common Stock
shall be determined in the same manner as the fair market value of Common
Stock on the date of grant of an option is determined pursuant to Section
5 of the Plan and shall be determined as of the date of exercise;
provided, however, that if the Optionee is an officer, director or more
than 10% shareholder of the Company, such fair market value shall be
determined as of the date which is six months after the date of such
exercise. The day on which the Optionee exercises the Option pursuant to
Paragraph 4 shall be considered the date on which such Option was
exercised.
The "Bonus Factor" shall be the fraction calculated by dividing
the Applicable Tax Rate, as hereinafter described, by an amount equal to
one minus the Applicable Tax Rate. The Board shall determine the
Applicable Tax Rate to be used in determining the amount, if any, of tax
offset bonuses payable to the Optionee, taking into account such factors
as it may deem necessary, including without limitation, the maximum income
tax rates applicable to individuals and the salary rate and grade of the
Optionee; provided, however, that the Applicable Tax Rate shall not exceed
the maximum income tax rate imposed on corporations.
9. The tax offset bonus shall be payable to the Optionee
within 15 days following exercise of an Option with respect to which such
bonus relates; provided, however, that if the Optionee is an officer,
director or 10% or more shareholder of the Company, such bonus shall be
payable within 15 days following the date as of which the fair market
value of the Common Stock purchased upon exercise of the Option is
determined pursuant to Paragraph 8.
10. The Company may deduct and withhold from any cash otherwise
payable to the Optionee upon exercise of any part or all of an Option such
amount as may be required for the purpose of satisfying the Company's
liability to withhold federal, state or local taxes incurred by reason of
the exercise of the Option and payment of such cash. Further, in the
event the amount so withheld is insufficient for such purpose the Company
may require as a condition precedent to the issuance or transfer of any
shares of Stock upon exercise of the Option that the Optionee pay to the
Company, upon its demand, or otherwise make arrangements satisfactory to
the Company for payment of, such amount as may be requested by the Company
to withhold any federal, state or local taxes. If the amount so requested
is not so paid or if such arrangements are not made, the Company may
refuse to issue or transfer any shares upon exercise of the Option.
11. In the event of a capital adjustment resulting from a stock
dividend (other than a stock dividend in lieu of an ordinary cash
dividend), stock split, reorganization, recapitalization, merger,
consolidation, combination or exchange of shares or the like, the Optioned
Shares shall be adjusted in a manner consistent with such capital
adjustment; provided, however, that no such adjustment shall require the
Company to sell any fractional shares and the adjustment shall be limited
accordingly. The price of any shares under Option shall be adjusted so
that there will be no change in the aggregate purchase price payable upon
exercise of any such Option. The determination of the Board as to any
adjustment shall be final.
12. The Optioned Shares may not be sold or offered for sale
except pursuant to an effective registration statement under the
Securities Act of 1933 or in a transaction exempt from the registration
provisions of said Act.
13. The Optionee shall not be deemed for any purposes to be a
stockholder of the Company with respect to any of the Optioned Shares
except to the extent that the Option shall have been exercised, the shares
shall have been fully paid, and a stock certificate issued therefore.
14. The existence of the Option shall not affect in any way the
right or power of the Company or its shareholders to make or authorize any
or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred
or prior preference stock ahead of or affecting the Common Stock of the
Company or the rights thereof, or dissolution or liquidation of the
Company, or any sale or transfer of all or any part of its assets or
business, or any other corporate act or proceeding, whether of a similar
character or otherwise.
15. It is understood that nothing herein contained shall be
deemed to confer upon the Optionee any right to continue in the employ of
the Company, nor to interfere in any way with the right of the Company to
terminate the employment of the Optionee at any time.
16. As a condition of the granting of the Option, the Optionee
agrees, for himself and his personal representatives, that this Agreement
shall be interpreted by the Committee and that any interpretation by the
Committee of the terms of this Agreement any determination made by the
Committee pursuant to this Agreement shall be final, binding and
conclusive.
IN WITNESS WHEREOF, the Company has cause this instrument to be
executed by its duly authorized officers and its corporate seal hereunto
affixed, and the Optionee has hereunto affixed his hand and seal as of the
day and year first above written.
NORTHLAND CRANBERRIES, INC.
By: ___________________________________
Xxxx Xxxxxxxxxxx, President
Attest: __________________________________
__________________________________________
Optionee