INTERFACE, INC. STOCK OPTION AGREEMENT
INTERFACE,
INC.
THIS
STOCK OPTION AGREEMENT (hereinafter referred to as the "Agreement"), made
and
entered into as of July 31, 1997, by and between Interface,
Inc.,
a
corporation organized under the laws of the State of Georgia (hereinafter
referred to as the "Corporation"), and Xxx
X. Xxxxx
(hereinafter referred to as the "Recipient").
W I T N E S S E T H:
WHEREAS,
the Corporation desires to grant to the Recipient a Stock Option to purchase
shares of the Corporation's Class A or B Common Stock (as the Corporation
determines), $0.10 par value per share (the "Common Stock"), on the terms
and
conditions hereinafter set forth.
NOW,
THEREFORE, for and in consideration of the premises and the mutual agreements
and covenants hereinafter set forth, consulting services to be rendered by
Recipient in accordance with Corporation's instructions, and other good and
valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Grant
Of Option.
Subject
to the terms and conditions of this Agreement, the Corporation hereby grants
to
the Recipient the right and option (the "Option") to purchase four thousand
(4,000) shares of the Common Stock (the "Option Shares").
2. Stock
Option.
(a) Option
Price.
The
purchase price of each share of Common Stock subject to this Option shall
be
fourteen dollars ($14.00), which price represents a value not less than the
fair
market value (meaning the closing sales price on the NASDAQ national market
system or such other principal securities exchange on which the Common Stock
may
be listed) of each such share as of the date of original grant of this
Option.
(b) Exercise
of Option.
The
Recipient may exercise this Option in whole or in part and from time to time
at
any time on or after the first anniversary of the date of this Agreement
and
prior to 5:00 p.m. on the date which immediately precedes the tenth anniversary
of the date of this Agreement; subject, however, to earlier termination as
provided in subparagraph 2(f) hereof and to the partial exercise provisions
of
subparagraph 2(c) immediately below. It is further provided that no partial
exercise of this Option may be made for less than 100 shares or, if less
than
such number then remain available for purchase by exercise of this Option,
the
number of such remaining shares.
(c) Partial
Exercise.
This
Option shall be exercisable on or after the first anniversary of the date
of
this Agreement only to the extent of: 800 of the Option Shares before the
expiration of two years from the date of this Agreement, 1,600 of the Option
Shares before the expiration of three years from the date of this Agreement,
2,400 of the Option Shares before the expiration of four years from the date
of
this Agreement and 3,200 of the Option Shares before the expiration of five
years from the date of this Agreement. During the sixth year from the date
of
this Agreement, and at any time thereafter until expiration of the term of
this
Option, this Option shall be exercisable to the full extent of all 4,000
of the
Option Shares (subject to the provisions of subparagraphs 2(b) and 2(f)
hereof).
(d) Manner
of Exercise.
This
Option may be exercised by delivering written notice of exercise to the
Secretary of the Corporation, in person, or by mail, postage prepaid, addressed
to the attention of the Secretary of the Corporation at the location at which
the Corporation then maintains its principal office (currently at 0000 Xxxxx
Xxxxx Xxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx 30339), and if so mailed, the date
of
mailing will be considered the date of exercise. The Corporation, in the
event
of exercise by an authorized person other than the Recipient, may require
proof
of the right of such person to exercise this Option. As promptly as practicable
after receipt by the Corporation of the aforementioned notice to purchase
and
the full purchase price, the Corporation shall cause to be issued to the
person
entitled to purchase the shares for which this Option is exercised, stock
certificate(s) for the number of shares of Common Stock being purchased,
which
shall evidence fully paid and nonassessable shares. The shares shall be either
Class A or Class B shares, or a combination thereof, as determined by the
Corporation at the time of issue.
(e) Person
Who May Exercise Option.
During
the lifetime of the Recipient, this Option shall be exercisable only by the
Recipient, or if the Recipient is disabled, by his duly appointed guardian
or
legal representative. Upon his or her death, this Option may be exercised
by the
Recipient's legal representative or by a person who receives the right to
exercise this Option under the Recipient's will or by the applicable laws
of
descent and distribution.
(f) Earlier
Termination of Option.
Notwithstanding any other provision of this Agreement, this Option, to the
extent that it has not previously been exercised, shall terminate upon the
earliest to occur of: (i) the expiration of the term of this Option as set
forth
in subparagraph 2(b) hereof, (ii) the expiration of three (3) months after
the
earlier of the date on which the Recipient has been notified that his services
no longer are needed, or he ceases to make his services available to the
Corporation; or (iii) the expiration of one (1) year after the death of the
Recipient or such later time as may be approved by the Compensation Committee
of
the Board of Directors of the Corporation (the "Committee").
3. Transferability.
This
Agreement and any rights hereunder shall be nontransferable and nonassignable
by
the Recipient or by any other person entitled hereunder to exercise any such
rights and may not be pledged or hypothecated in any way; provided, however,
that upon the death of the Recipient any rights granted hereunder shall be
transferable, subject to the provisions of subparagraph 2(f) hereof, by the
Recipient's will or by the applicable laws of descent and distribution. Any
attempted transfer, assignment, pledge or other disposition of this Option
contrary to the provisions hereof shall be null and void and without legal
effect.
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4. Adjustment
Of Shares.
In the
event of (i) any dividend payable in shares of Common stock; (ii) any
recap-italization, reclassification, split-up or consolidation of, or other
change in, the Common Stock; or (iii) an exchange of the outstanding shares
of
Common stock, in connection with a merger, consolidation or other reorganization
of the Corporation or a sale by the Corporation of all or a portion of its
assets, for a different number or class of shares of stock or other securities
of the Corporation or for shares of the stock or other securities of any
other
corporation; then the Corporation shall, in such manner as it shall determine
in
its sole discretion to be appropriate under the circumstances, adjust the
number
and class of the Option Shares or the number and class of shares or other
securities that shall then be subject to this Option and/or the purchase
price
per share which must be paid thereafter upon exercise of this
Option.
5. Investment
Representation.
The
Recipient hereby represents, warrants and agrees that:
(a) He
understands the offer of shares under this Agreement is made pursuant to
a claim
of exemption from the registration provisions of the Securities Act of 1933,
as
amended (the "Act") and applicable state securities law;
(b) The
Corporation shall not be obligated to issue shares of the Common Stock upon
exercise of this Option until there has been compliance with any federal,
state
or foreign laws or regulations which the Corporation may deem
applicable;
(c) The
shares that shall be purchased under this Agreement, if unregistered as referred
to in subparagraph 5(d) below, will be purchased for his own account for
investment purposes only and not with a view to resale or distribution
thereof;
(d) The
shares subject to this Agreement may be unregistered and, if so, will be
required to be held until such shares are subsequently registered or an
exemption from registration is then available;
(e) The
Corporation is under no obligation to register such shares or to undertake
to
facilitate compliance with any such exemption; and
(f) The
transfer agent for the Corporation may be instructed not to transfer ownership
of the stock certificate(s) representing shares acquired upon any exercise
of
this Option, unless in the prior written opinion of counsel reasonably
acceptable to the Corporation, such transfer is lawful under the Act and
applicable state securities law.
In
regard
to the foregoing, the Recipient understands and agrees that the certificate(s)
evidencing any shares that may be purchased pursuant to the exercise of this
Option which have not been registered under the Act or any applicable state
securities law, may bear an appropriate restrictive legend in a form determined
in the sole discretion of the Corporation.
6. No
Rights As Shareholder.
Neither
the Recipient nor any other person authorized to purchase Common Stock upon
exercise of this Option shall have any interest in or shareholder rights
with
respect to any shares of the Common Stock which are subject to this Option
until
such shares have been issued and delivered to the Recipient or any such person
pursuant to the exercise of this Option.
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7. Heirs
And Successors.
This
Agreement and all terms and conditions hereof shall be binding upon the
Corporation and its successors and assigns, and upon Recipient and his heirs,
legatees and legal representatives.
8. Miscellaneous.
This
Option is executed and delivered in, and shall be governed by, the laws of
the
State of Georgia. This Agreement may not be modified or amended (except to
the
extent otherwise expressly stated herein) other than by a writing executed
by
each of the parties hereto.
IN
WITNESS WHEREOF, the Corporation has caused this Agreement to be executed
by its
duly authorized officer, and the Recipient has executed this Agreement, all
as
of the date and year first above written.
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INTERFACE,
INC.
By:
/s/Xxx
X.
Xxxxxxxx
Xxx X. Xxxxxxxx, Chairman
and Chief Executive Officer
RECIPIENT:
/s/Xxx
X.
Xxxxx
Xxx
X. Xxxxx
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EXERCISE
OF
STOCK
OPTION
The
undersigned option Recipient under that certain Interface, Inc. Stock Option
Agreement dated as of July 31, 1997 (the "Agreement"), hereby exercises the
Stock Option granted under the Agreement for the following number of shares
of
Common Stock, subject to the terms and conditions of the Agreement:
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Number
of shares being purchased
Total
purchase price submitted herewith $
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(Signature) (Print
Name and Representative)
Capacity,
if Applicable)
(Date)
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