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EXHIBIT 10.22
INCENTIVE STOCK OPTION GRANT AGREEMENT
GRANTED TO: Xxxxx X. Xxxxx, Xx.
DATE OF GRANT: December 30, 1997
GRANTED PURSUANT TO: (i) Paragraph 6 of an employment agreement
dated March 10, 1998 between the Company and
Xxxxx X. Xxxxx, Xx. and (ii) Outboard Marine
Corporation Personal Rewards and
Opportunities Program
NUMBER OF UNDERLYING SHARES: 61,105 shares
EXERCISE PRICE: $18.00 per share
VESTING SCHEDULE: 5,555 shares become exercisable on the Date
of Grant and an additional 5,555 shares
become exercisable on each of the next 10
January 1sts following the Date of Grant
1. This Incentive Stock Option Grant Agreement (the "Agreement") is
made and entered into as of December 30, 1997 (the "Date of Grant") between
Outboard Marine Corporation, a Delaware corporation (the "Company"), and Xxxxx
X. Xxxxx, Xx. (the "Employee") pursuant to Paragraph 6 of an employment
agreement dated March 10, 1998 between the Company and the Employee (the
"Employment Agreement "). It is the intent of the Company and the Employee that
the Option (as defined in Paragraph 2 below) shall qualify as an "incentive
stock option" ("ISO") under Section 422 of the Internal Revenue Code of 1986, as
amended from time to time, but the Company makes no warranty as to the
qualification of the Option as an ISO. Moreover, to the extent that the
aggregate fair market value of the shares with respect to which the Option and
all other ISOs granted to the Employee by the Company are exercisable for the
first time during any calendar year exceeds $100,000, such options shall not
qualify as ISOs.
2. The Employee is granted an option to purchase 61,105 shares of the
common stock of the Company (the "Option"). The Option is granted under the
Outboard Marine Corporation Personal Rewards and Opportunities Program ("PROP"),
a copy of which is enclosed herewith and to the extent directly relating to the
Option, under Paragraphs 6, 11, 12 and 13 of the Employment Agreement, the
provisions of which are incorporated herein. The Option granted hereunder is a
matter of separate inducement and is not in lieu of salary or other compensation
for the Employee's services.
3. The Option's Exercise Price is $18.00 per share.
4. The Option, unless sooner terminated or exercised in full, shall
expire on the 10th anniversary of the Date of Grant and, notwithstanding
anything contained in this Agreement to the contrary, no portion of the Option
may be exercised after such date.
5. Subject to Paragraph 4 above and the terms of the Employment
Agreement incorporated herein, the Option shall become exercisable according to
the exercisability schedule set forth below:
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5,555 shares shall become exercisable on the Date
of Grant and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 1998 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 1999 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2000 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2001 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2002 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2003 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2004 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2005 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
5,555 shares shall become exercisable on January
1, 2006 and shall remain exercisable until
the 10th anniversary of the Date of Grant;
and
5,555 shares shall become exercisable on January
1, 2007 and shall remain exercisable until
the 10th anniversary of the Date of Grant.
6. During the Employee's lifetime, the Option shall not be subject in
any manner to alienation, anticipation, sale, assignment, pledge, encumbrance or
other transfer and shall be exercisable only by the Employee. Upon the death of
the Employee, the Option shall be exercisable only by the executor or
administrator of the estate of the deceased Employee or the person or persons to
whom the deceased Employee's rights with respect to the Option shall pass by
will or the laws of descent and distribution.
7. The Employee may exercise the exercisable portion of the Option
regardless of whether any other stock option that the Employee has been granted
by the Company remains unexercised. In no event may the Employee exercise the
Option for a fraction of a share or for less than 100 shares (unless the number
purchased is the total balance for which the Option is then exercisable).
8. Any exercise of the Option shall be in writing addressed to the
Corporate Secretary of the Company at the principal business office of the
Company, specifying the Option being exercised and the number of shares of Stock
to be purchased, and specifying a business day not more than 10 days from the
date such notice is given for the payment of the purchase price against delivery
of the shares of Stock being purchased. Subject to the terms of PROP and this
Agreement, the Company shall cause certificates for the shares so purchased to
be delivered at the principal business office of the Company, against payment of
the full purchase price, on the date specified in the notice of exercise. The
Option's Exercise Price shall be paid by the Employee in cash or, if permitted
by the Committee in its sole discretion at the time of exercise, in shares of
Common Stock currently held by the Employee at the time of exercise, or by a
combination of
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cash and such currently held shares. Any shares of Common Stock delivered in
payment of the Exercise Price shall be valued at their then fair market value.
9. By his acceptance of this Agreement, the Employee agrees to
reimburse the corporation employing the Employee for any taxes required by any
government to be withheld or otherwise deducted and paid by such corporation
with respect to the issuance or disposition of the shares subject to the Option.
In lieu thereof, the corporation that employs the Employee shall have the right
to withhold the amount of such taxes from any other sums due or to become due
from such corporation to the Employee. The corporation that employs the Employee
may, in its discretion, hold the stock certificate or certificates to which the
Employee is entitled upon the exercise of the Option as security for the payment
of such withholding tax liability until cash sufficient to pay that liability
has been accumulated. In addition, at any time that the Company becomes subject
to a withholding obligation under applicable law with respect to the exercise of
a Non-Qualified Option (the "Tax Date"), except as set forth below, a holder of
a Non-Qualified Option may elect to satisfy, in whole or in part, the holder's
related personal tax liabilities (an "Election") by (a) directing the Company to
withhold from shares of Stock issuable in the related exercise either a
specified number of shares of Stock or shares of Stock having a specified value
(in each case not in excess of the related personal tax liabilities), (b)
tendering shares of Stock previously issued pursuant to the exercise of a stock
option or other shares of Stock owned by the holder, or (c) combining any or all
of the foregoing Elections in any fashion. An Election shall be irrevocable. The
withheld shares and other shares of Stock and other shares of Stock tendered in
payment shall be valued at their fair market value on the Tax Date. The
Committee may disapprove of any Election, suspend or terminate the right to make
Elections or provide that the right to make Elections shall not apply to
particular shares of Stock or exercises. The Committee may impose any additional
conditions or restrictions on the right to make an Election as it shall deem
appropriate, including any limitations necessary to comply with Section 16 of
the Exchange Act.
10. The Employee shall not have any of the rights of a shareholder with
respect to the shares of Common Stock underlying the Option until the Option is
exercised and the Employee receives such shares.
11. If the Company, in its sole discretion, shall determine that it is
necessary, to comply with applicable securities laws, the certificate or
certificates representing the shares purchased pursuant to the exercise of the
Option shall bear an appropriate legend in form and substance, as determined by
the Company, giving notice of applicable restrictions on transfer under or with
respect to such laws.
12. The Employee covenants and agrees with the Company that if, at the
time of exercise of the Option, there does not exist a Registration Statement on
an appropriate form under the Securities Act of 1933, as amended (the "Act"),
which Registration Statement shall have become effective and shall include a
prospectus that is current with respect to the shares subject to the Option,
then the Employee shall execute and deliver a certificate to the Company
indicating (i) that he is purchasing the shares for his own account and not with
a view to the resale or distribution thereof, (ii) that any subsequent offer for
sale or sale of any such shares shall be made either pursuant to (x) a
Registration Statement on an appropriate form under the Act, which Registration
Statement shall have become effective and shall be current with respect to the
shares being offered and sold, or (y) a specific exemption from the registration
requirements of the Act and any rules and regulations thereunder and applicable
state securities laws and regulations, but in claiming such exemption, the
Employee shall, prior to any offer for sale or sale of such shares, obtain a
favorable written opinion from counsel for or approved by the Company as to the
applicability of such exemption and (iii) that the Employee agrees that the
certificate or certificates evidencing such shares shall bear a legend to the
effect of the foregoing.
13. This Agreement is not a contract of employment and the terms of the
Employee's employment shall not be affected hereby or by any agreement referred
to herein except to the extent specifically so provided herein or therein.
Nothing herein shall be construed to impose any obligation on the Company to
continue the Employee's employment, and it shall not impose any obligation on
the Employee's part to remain in the employ of the Company.
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14. The Employee acknowledges and agrees that neither the Company, its
shareholders nor its directors and officers, has any duty or obligation to
disclose to the Employee any material information regarding the business of the
Company or affecting the value of the Common Stock before or at the time of a
termination of the employment of the Employee by the Company, including, without
limitation, any information concerning plans for the Company to make a public
offering of its securities or to be acquired by or merged with or into another
firm or entity.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date written below.
OUTBOARD MARINE CORPORATION
By /s/ Xxxx X. Xxxxxxxxxx
__________________________
Xxxx X. Xxxxxxxxxx
ACCEPTED:
Signature of Employee
/s/ Xxxxx X. Xxxxx, Xx.
______________________________
XXXXX X. XXXXX, XX.
Name of Employee (please print)
Date: 12/21/98
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