KANSAS CITY SOUTHERN INDUSTRIES, INC. 2008 STOCK OPTION AND PERFORMANCE AWARD PLAN NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
EXHIBIT 10.47.1
By this Agreement, Kansas City Southern, a Delaware corporation (the “Company”), grants to
you, [Name], an employee of the Company or an Affiliate, (the “Grantee”), (i) a non-qualified stock
option (the “Option”) to purchase that number of shares (“Shares”) of the Company’s Common Stock,
$.01 par value, set forth below and (ii) an equal number of limited stock appreciation rights
(“LSARs”), all subject to the terms and conditions set forth below and in the attached Exhibit A
hereto and in the Kansas City Southern 2008 Stock Option and Performance Award Plan (including
Committee rules, regulations, policies and procedures established thereunder) as may from time to
time be amended (the “Plan”), all of which are an integral part of this Agreement.
| Grant Date: | [Date] | |||
| Number of Shares: | [Options] | |||
| Option Price: | [Price] |
This Option shall become exercisable on [Exercisable Date], provided you remain continuously
employed by the Company or an Affiliate from the Grant Date to such date the Option becomes
exercisable. The term of the Option shall be ten (10) years from the Grant Date unless terminated
earlier as provided in Exhibit A or in the Plan.
The Award evidenced by this Agreement shall not be effective until you have indicated your
acceptance of this Agreement by signing one copy of this Agreement in the space provided below and
returning it to the Corporate Secretary’s Office, in the envelope provided, within ten (10) days
after your receipt of this Agreement from the Company. You should retain one copy of this
Agreement for your records.
| Kansas City Southern |
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| By: | ||||
| Name and Title: | ||||
ACCEPTED AND AGREED: |
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[Address] |
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[City, State, Zip] |
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Dated: , 200 |
EXHIBIT A
TO
STOCK OPTION AGREEMENT
TO
STOCK OPTION AGREEMENT
1. Plan Governs. The Award and this Agreement are subject to the terms and conditions
of the Plan. The Plan is incorporated in this Agreement by this reference. All capitalized terms
used in this Agreement have the meaning set forth in the Plan unless otherwise defined in this
Agreement. By executing this Agreement, you acknowledge receipt of a copy of the Plan and the
prospectus covering the Plan and you acknowledge that the Award is subject to all the terms and
provisions of the Plan. You further agree to accept as binding, conclusive and final all decisions
and interpretations by the Plan Committee with respect to any questions arising under the Plan. By
signing this Agreement you are not obligated to exercise all or any part of this Option or any
other Option.
2. Manner of Exercise. This Option shall be exercised by delivering to the Company
(or its authorized agent), during the period in which such Option is exercisable, (i) a written
notice of your intent to purchase a specific number of Shares pursuant to this Option (a “Notice of
Exercise”), and (ii) full payment of the Option Price for such specific number of Shares. Payment
may be made by any one or more of the following means:
(a) Cash, personal check, or wire transfer;
(b) if approved and permitted by the Committee, Shares owned by you with a Fair Market
Value on the last complete stock trading day preceding such exercise equal to the Option
Price, which such Shares must be fully paid, non-assessable, and free and clear from all
liens and encumbrances, or
(c) if approved and permitted by the Committee, through the sale of the Shares acquired
on exercise of this Option through a broker to whom you have submitted irrevocable
instructions to deliver promptly to the Company the amount of sale or loan proceeds
sufficient to pay for such Shares, together with, if required by the Company, the minimum
statutory amount of federal, state, local or foreign withholding taxes payable by reason of
such exercise. A Copy of such delivery instructions must also be delivered to the Company by
the Grantee with the Notice of Exercise; or
(d) if approved and permitted by the Committee, with Restricted Shares owned by you
with a Fair Market Value on the last completed stock trading day preceding such exercise
equal to the Option Price.
The exercise of the Option shall become effective at the time such a Notice of Exercise has been
received by the Company, which must be before the tenth anniversary of the Grant Date (the
“Expiration Date”). The exercise of this Option as to a number of Shares will result in the
cancellation of an equal number of LSARs. You shall not have any rights as a stockholder of the
Company with respect to the Shares deliverable upon exercise of this Option until a certificate for
such Shares is delivered to you.
If the Option is exercised as permitted herein by any person or persons other than Grantee,
such Notice of Exercise shall be accompanied by such documentation as Company may reasonably
require,
including without limitation, evidence of the authority of such person or persons to
exercise the Option and evidence satisfactory to Company (if required by the Company) that any
death taxes payable with respect to such Shares have been paid or provided for.
3. Exercisability. This Option shall become fully exercisable upon your Termination
of Affiliation on account of (a) Retirement, (b) death or (c) Disability. Retirement means
Retirement as defined in the Plan (Termination of Affiliation after having both attained age 55 and
completed 10 years of service) and as specified in Committee rules, regulations or policies
(currently Termination of Affiliation after having attained age 65).
4. Change of Control. This Option shall become fully exercisable upon your
Termination of Affiliation on account of a Change of Control. Upon your Termination of Affiliation
on account of a Change of Control, all LSARs then outstanding shall automatically be exercised and
this Option shall be canceled.
5. Exercise After Termination of Affiliation. This Option may be exercised only while
you are employed by the Company or an Affiliate, except that this Option may also be exercised
after the date on which you have a Termination of Affiliation (“Termination Date”) as follows:
(i) if you have a Termination of Affiliation by reason of your Retirement, you may also
exercise this Option at any time during the first five years after your Termination Date;
(ii) if you have a Termination of Affiliation by reason of your Disability, you may
also exercise this Option at any time during the first 12 months after your Termination
Date;
(iii) if you have a Termination of Affiliation by reason of your death, the executor or
administrator of your estate, your heirs or legatees, or beneficiary designated in
accordance with the Plan, as applicable, may also exercise this Option at any time during
the first 12 months after your Termination Date; and
(iv) if you have a Termination of Affiliation on account of any other reason (other
than a dismissal for Cause), you may also exercise this Option at any time during the first
three months after your Termination Date;
provided, however, that (x) except as otherwise provided in Section 3 or 4 of this Exhibit A, this
Option may be exercised after your Termination Date only to the extent it is exercisable on the
Termination Date, (y) under no circumstances may this Option be exercised on or after the
Expiration Date, and (z) the expiration of your Option will automatically result in the expiration
of all associated LSARs. For purposes of this Section 5, if you are employed by an Affiliate of
the Company, you will be deemed to have had a Termination of Affiliation as of the first day on
which such corporation ceases to be an Affiliate of the Company.
6. Affiliation with Competitor. Notwithstanding anything to the contrary contained
herein, if Grantee, without Company’s consent, becomes associated with, employed by, renders
service to, or owns any interest in (other than any non-substantial interest, as the Committee from
time to time determines) any business that is in competition with Company or any Related Company
(as defined below), this Option shall terminate and cease to be exercisable immediately upon such
event. For
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purposes of this paragraph, Related Company means (i) any individual or entity that
directly, or through one or more intermediaries, controls, or is controlled by, or is under common
control with, the
Company, and (ii) any entity in which the Company owns, directly or indirectly, 20% or more of
the combined value of all equity interests.
7. No Waiver. The failure of Company in any instance to exercise any of its rights
granted under this Agreement or the Plan shall not constitute a waiver of any other rights that may
arise under this Agreement.
8. Limited Transferability of Option. Except as provided in the immediately following
sentence, this Option is exercisable during your lifetime only by you or your guardian or legal
representative, and this Option and the associated LSARs are not transferable except by will or the
laws of descent and distribution. To the extent and in the manner permitted by the Committee, and
subject to such terms, conditions, restrictions or limitations that may be prescribed by the
Committee, you may transfer this Option and the associated LSARs to (i) your spouse, sibling,
parent, child (including an adopted child) or grandchild (any of which an “Immediate Family
Member”); (ii) a trust, the primary beneficiaries of which consist exclusively of you or your
Immediate Family Members; or (iii) a corporation, partnership or similar entity, the owners of
which consist exclusively of you or your Immediate Family Members.
9. Fractional or De Minimis Shares. Neither the Option nor the LSARs shall be
exercisable with respect to a fractional share or with respect to fewer that ten (10) Shares,
unless the remaining Shares, are fewer than ten (10)).
10. Nonstatutory Option. This Option has been designated by the Committee as a
Nonstatutory Option; it does not qualify as an Incentive Stock Option.
11. Taxes. The Company is not required to issue Shares upon the exercise of this
Option unless you first pay to the Company such amount, if any, as may be required by the Company
to satisfy any liability it may have to withhold federal, state, local or foreign income or other
taxes relating to such exercise. You may elect to satisfy such tax withholding obligation by
delivering to the Company a written irrevocable election to have the Company withhold a portion of
the Shares purchased upon exercise of the Option having a Fair Market Value not in excess of the
minimum statutory amount of taxes required to be withheld; provided, however, that the Committee
may, at any time before you file such an election with the Company, revoke your right to make such
an election. The Company retains the discretion to require a specific method of withholding and
may exercise such discretion at any time with respect to this Option grant.
12. No Right to Employment. Nothing in this Agreement shall interfere with or limit
in any way the right of the Company or an Affiliate to terminate your employment or service at any
time, nor confer upon you the right to continue in the employ of the Company or an Affiliate.
13. Notices. Any notice to be given under the terms of this Agreement to the Company
shall be addressed to the Company in care of its Corporate Secretary. Any notice to be given to
you shall be addressed to you at the address listed in the Company’s records. By written notice
referencing this paragraph of this Agreement, either party may designate a different address for
notices. Any notice under this Agreement to the Company shall become effective upon receipt by the
Company.
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Any notice under this Agreement to you will be deemed to have been delivered to you when
delivered in person or when deposited in the United States mail, addressed to you at your address
on the
shareholder records of the Company, or such other address as you have designated under this
paragraph.
14. Amendment. The Company reserves the right to amend the Plan at any time. The
Committee reserves the right to amend this Agreement at any time.
15. Severability. If any part of this Agreement is declared by any court or
governmental authority to be unlawful or invalid, such unlawfulness or invalidity shall not serve
to invalidate any part of this Agreement not declared to be unlawful or invalid. Any part so
declared unlawful or invalid shall, if possible, be construed in a manner which gives effect to the
terms of such part to the fullest extent possible while remaining lawful and valid.
16. Applicable Law. This Agreement shall be governed by the laws of the State of
Delaware other than its laws respecting choice of law.
17. Headings. Headings are provided herein for convenience only and are not to serve
as a basis for interpretation or construction of this Agreement.
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