HUNTCO INC.
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the ______ day of ______________,_____, by
and between Huntco Inc. (the "Company") and _______________________ ("You" or
"Your").
RECITALS:
A. You are an employee of the Company or one of its Subsidiaries.
B. The Company wishes to enter into this Stock Option Agreement to
secure for the Company the benefits of the incentive inherent in common stock
ownership by a key employee of the Company, and to afford You the opportunity
to obtain or increase a proprietary interest in the Company and, thereby, to
have an opportunity to share in its success.
C. The granted option shall be a non-qualified stock option, which
does not satisfy the requirements of Section 422 of the Code.
NOW, THEREFORE, it is hereby agreed as follows:
1. Definitions. When used in this Agreement, the following terms
shall have the following meanings:
(a) "Agreement" shall mean this Stock Option Agreement.
(b) "Class A Common Stock" shall mean the Class A Common Stock of
the Company having a par value of $.01 per share.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(d) "Discharge" shall mean Termination of Employment other than a
Voluntary Termination.
(e) "Discharge for Aggravated Cause" shall mean a Discharge (i)
because You commit a dishonest or illegal act that causes substantial
financial harm to the Company, (ii) because You intentionally subvert the best
interest of the Company, or (iii) because of gross negligence by You.
(f) "Engage in Competition" shall mean a breach by You of the
non-competition or non-disclosure provisions of any written employment
agreement between You and the Company.
(g) "Expiration Date" is defined in Paragraph 3.
(h) "Fair Market Value" shall mean on any given date the closing
price per share of the Class A Common Stock of the Company prevailing on a
national securities exchange which is registered under the Securities Exchange
Act of 1934, or, if Class A Common Stock was not traded on such date, on the
next preceding date on which such Class A Common Stock was traded; or, if the
Class A Common Stock is not traded on such a national securities exchange, the
mean between the current bid and asked prices, as determined by the Company in
good faith, for the Class A Common Stock quoted by persons independent of the
Company and any of its affiliates, and in the case there is no generally
recognized market for the Class A Common Stock, the fair market value as
determined in good faith by the Company.
(i) "Grant Date" shall mean ___________.
(j) "Hunter Affiliate" is defined in Paragraph 6(d)(iii).
(k) "Hunter Group" is defined in Paragraph 6(d)(iii).
(l) "Notice Period" is defined in Paragraph 6(d).
(m) "Option Price" shall mean _________ per share.
(n) "Optioned Shares" is defined in Paragraph 2.
(o) "Option Term" is the period described in Paragraph 3.
(p) "Purchase Agreement" shall mean a stock purchase agreement in
substantially the form of Exhibit A to this Agreement.
(q) "Subsidiary" means any corporation that is a "subsidiary
corporation" within the meaning of Section 424(f) of the Code with respect to
the Company.
(r) "Termination of Employment" shall mean termination of the
employment relationship between You and the Company or its Subsidiaries.
(s) "Voluntary Termination" shall mean a Termination of Employment
resulting solely from Your initiative without undue influence or coercion on
You caused by the Company.
2. Grant of Option. Subject to and upon the terms and conditions of
the Huntco Inc. 1993 Incentive Stock Plan (as amended and restated in 1996),
and the terms and conditions set forth in this Agreement, the Company hereby
grants to You, as of the Grant Date, an option to purchase up to _______
shares of the Company's Class A Common Stock (the "Optioned Shares") from time
to time during the Option Term at the Option Price.
3. Option Term. This option shall completely expire at the close of
business on the day before the fifth anniversary of the Grant Date (the
"Expiration Date"), unless sooner terminated in accordance with Paragraph 7.
In no event shall any option be exercisable at any time after its Expiration
Date.
4. Option Nontransferable. This option shall be neither transferable
nor assignable by You other than by will or by the laws of descent and
distribution, and may be exercised during Your lifetime only by You.
5. Dates of Exercise. _____________________ percent of the Optioned
Shares shall first become exercisable on _____________________ and an
additional _____________________ percent of the Optioned Shares shall first
become exercisable on each subsequent anniversary of such date, as illustrated
by the following schedule:
EARLIEST EXERCISE DATE PERCENTAGE OF OPTIONED
SHARES THAT MAY BE EXERCISED
XX/XX/XX ___%
XX/XX/XX ___%
XX/XX/XX ___%
XX/XX/XX ___%
XX/XX/XX ___%
Pursuant to the provisions of this Agreement, during the Option Term You may
purchase any or all of the Optioned Shares that have become exercisable as
described above at any time or from time to time. In no event may You
purchase any nonvested Optioned Shares except as provided in Section 6 below.
6. Accelerated Dates of Exercise. The dates of exercise specified in
Paragraph 5 shall accelerate should one of the following provisions become
applicable.
(a) If You are Discharged as a part of an overall reduction in
the Company's work force and for reasons unrelated to your own specific job
performance before the dates specified in Paragraph 5, You shall have the
immediate right to purchase the entire number of Optioned Shares specified in
Paragraph 2 within three months after termination of Your employment, but in
no event shall this option be exercisable at any time after its Expiration
Date. Upon the expiration of such three month period or (if earlier) upon the
applicable Expiration Date, this option shall terminate and cease to be
exercisable.
(b) Should You die while this option is outstanding, the
executors or administrators of Your estate or Your heirs or legatees (as the
case may be) shall have the right to exercise this option for the entire
number of Optioned Shares specified in Paragraph 2. Such right shall lapse
and this option shall cease to be exercisable upon the earlier of (i) the
first anniversary of the date of Your death or (ii) the Expiration Date
applicable to each of such shares. From time to time, in a form acceptable to
the Company, You may designate any person or persons (concurrently,
contingently or successively) to whom the stock option shall be transferred in
the event that You shall die before You fully exercise the stock option. A
beneficiary designation form shall be effective only when the form is signed
by You and filed in writing with the Company while You are alive, and shall
cancel all beneficiary designation forms that You have previously signed and
filed.
(c) Should You become permanently disabled, such that You are
unable to perform the material duties of Your employment with the Company, and
cease by reason thereof to render periodic services to the Company at any time
during the Option Term, then You shall have the right for a period of twelve
months (commencing with the date of such cessation of service status) to
purchase the entire number of Optioned Shares specified in Paragraph 2;
provided, however, that in no event shall this option be exercisable at any
time after the Expiration Date applicable to each of such shares. Upon the
expiration of the limited period of exercisability or (if earlier) upon such
Expiration Date, this option shall terminate and cease to be exercisable.
(d) In the event of a Change in Control, pursuant to
Subparagraphs (i)-(ii) of this Paragraph 6(d), the Company shall provide You
with written notice of such Change in Control not less than ten (10) days
prior to the anticipated consummation thereof (the "Notice Period"), and You
shall have the immediate right during such Notice Period to purchase the
entire number of Optioned Shares specified in Paragraph 2, but in no event
shall this option be exercisable after the Expiration Date. In the event of a
Change in Control pursuant to Subparagraph (iii) of this Paragraph 6(d), You
shall have the immediate right to purchase the entire number of Optioned
Shares specified in Section 2, but in no event shall this option be
exercisable after the Expiration Date. Nothing in this Subparagraph 6(d)
shall be deemed to affect any rights you may have pursuant to Paragraph 8
hereof. A Change in Control means the happening of any of the following
events:
(i) a merger, consolidation or reorganization of the
Company in which the Company does not survive as a publicly held company; or
(ii) a sale of all or substantially all of the assets of
the Company; or
(iii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board of
Directors of the Company cease for any reason to constitute a majority of such
Board. For purposes of this Paragraph 6(d)(iii), a director shall be
considered to be a director at the beginning of such two-year period if the
director's election was approved either (x) during the lifetime of X.X. Xxxxxx
by the "Hunter Affiliates" as that term is defined in Article 6(b)(iv) of the
Company's Restated Articles of Incorporation (the "Restated Articles") or, if
after the death of X. X. Xxxxxx, the "Xxxxxx Group" as that term is defined in
Article 6(b)(i) of the Restated Articles, or (y) by a vote of at least 70
percent of the directors then still in office who were directors at the
beginning of the two-year period or who would be considered pursuant to this
sentence to be a director at the beginning of the two-year period.
7. Forfeiture of Options. The Option Term shall terminate (and this
option shall cease to be exercisable) prior to the Expiration Date should one
of the following provisions become applicable.
(a) Except as otherwise provided in subparagraph (b) below,
should You incur a Termination of Employment, other than a Discharge for
Aggravated Cause, then for a period of three months after the date of such
Termination of Employment You shall have the right to purchase only the number
of Optioned Shares (if any) for which this option has become exercisable on
the date of such a Termination of Employment, but in no event shall this
option be exercisable at any time after its Expiration Date. Upon the
expiration of such three month period or (if earlier) upon the applicable
Expiration Date, this option shall terminate and cease to be exercisable.
Options that have not become exercisable in accordance with Paragraph 5 at the
time of such a Termination of Employment shall terminate and never become
exercisable.
(b) Should You be Discharged for Aggravated Cause or Engage in
Competition with the Company at any time during the Option Term, You shall
forfeit the right to purchase any Optioned Shares pursuant to this Agreement
on or after such occasion.
8. Adjustment in Optioned Shares.
(a) In the event any change is made to the common stock of the
Company issuable under this Agreement by reason of any stock split, stock
dividend, combination of shares, or other change affecting the outstanding
common stock as a class without receipt of consideration, then appropriate
adjustments will be made to (i) the total number of Optioned Shares and (ii)
the Option Price in order to reflect such change and thereby preclude a
dilution or enlargement of benefits hereunder.
(b) If the Company is the surviving entity in any merger or
other business combination, then this option, if outstanding under this
Agreement immediately after such merger or other business combination, shall
be appropriately adjusted to apply and pertain to the number and class of
securities which would be issuable to You in the consummation of such merger
or business combination if the option were exercised immediately prior to such
merger or business combination, and appropriate adjustments shall be made to
the Option Price, provided the aggregate Option Price payable hereunder shall
remain the same.
(c) If the Company is not the surviving entity in a merger or
other business combination, then as to the balance of the Optioned Shares not
yet purchased by You, You shall have the right to receive on the effective
date of the merger the difference in cash between the aggregate Option Price
of said shares and the aggregate Fair Market Value for the Class A Common
Stock of the Company paid as a result of the merger or combination whether or
not You then had the right to exercise this option.
9. Privilege of Stock Ownership. As holder of this option, You shall
not have any of the rights of a shareholder with respect to the Optioned
Shares until You have exercised the option and paid the Option Price.
10. Manner of Exercising Option.
(a) In order to exercise this option with respect to all or any
part of the Optioned Shares for which this option is at the time exercisable,
You (or in the case of exercise after Your death, Your executor,
administrator, heir or legatee, as the case may be) must take the following
actions:
(i) Execute and deliver to the Secretary of the Company a
Purchase Agreement in the form attached hereto as Exhibit A; and
(ii) Pay the aggregate Option Price for the purchased
Optioned Shares in one or more of the following alternative forms:
(A) full payment, in cash or cash equivalents; or
(B) full payment in shares of Class A Common Stock
of the Company, by delivering shares of Class A Common Stock that You already
own having an aggregate Fair Market Value equal to the aggregate Option Price;
or
(C) full payment in a combination of shares of
Class A Common Stock of the Company valued at the Fair Market Value and cash
or cash equivalents, equal in the aggregate to the aggregate Option Price; or
(D) any other form which the Company may in its
discretion approve at the time of exercise of this option; and
(iii) Pay to the Company the amount of withholding
required pursuant to Paragraph 15.
(iv) Furnish to the Company appropriate documentation
that the person or persons exercising the option, if other than You, have the
right to exercise this option.
(b) Options shall be deemed to have been exercised with respect
to the number of Optioned Shares specified in the Purchase Agreement at such
time as the executed Purchase Agreement for such shares shall have been
delivered to the Company. Payment of the aggregate Option Price shall
immediately become due and shall accompany the Purchase Agreement. The Fair
Market Value of shares tendered in payment of the aggregate Option Price shall
be determined as of such date. As soon thereafter as practical, the Company
shall mail or deliver to You or to the other person or persons exercising this
option a certificate or certificates representing the Optioned Shares so
purchased and paid for.
11. Compliance with Laws and Regulations.
(a) The exercise of this option and the issuance of Optioned
Shares upon such exercise shall be subject to compliance by the Company and
You with all applicable requirements of law relating thereto.
(b) In connection with the exercise of this option, You shall
execute and deliver to the Company such representations in writing as may be
requested by the Company in order for it to comply with the applicable
requirements of federal and state securities laws.
12. Successors and Assigns. Except to the extent otherwise provided
in Paragraph 4, the provisions of this Agreement shall inure to the benefit
of, and be binding upon, Your successors, administrators, heirs, legal
representatives and assigns and the successors and assigns of the Company.
13. No Employment or Service Contract. Except to the extent the
terms of any employment or service contract between the Company and You may
expressly provide otherwise, no provision of this Agreement shall be construed
so as to grant You any right to remain as an employee of the Company or its
parent or subsidiary corporations, if any, for any period of specific
duration.
14. Notices. Any and all notices referred to or relating to this
Agreement shall be furnished in writing and delivered in person or sent by
registered mail to the representative parties at the addresses following their
signatures to this Agreement or at an address given in a notice that complies
with the terms of this Paragraph. A copy of all notices shall be sent to the
Company at Huntco Inc., 00000 Xxxxx Xxxxx Xxxxx, Xxxxx 000X, Xxxx & Xxxxxxx,
Xxxxxxxx 00000.
15. Withholding. If You acquire Optioned Shares, the Company shall
not deliver or otherwise make such shares available to You until You pay to
the Company in cash (or any other form acceptable to the Company) the amount
necessary to enable the Company to remit to the appropriate government entity
or entities on Your behalf the amount required to be withheld from Your wages
with respect to such transaction.
If, after a reasonable period of time after You exercise this option, You
have failed to remit to the Company the amount necessary to enable the Company
to remit to the appropriate government entity or entities on Your behalf the
amount required to be withheld from Your wages with respect to such
transaction, You hereby authorize, and explicitly grant a power of attorney,
to the Company to sell on Your behalf such number of the Optioned Shares as is
necessary for the Company to obtain such amount.
16. Construction. This Agreement and the option evidenced hereby are
in all respects limited by and subject to the express terms and provisions of
this Agreement. All decisions of the Company with respect to any question or
issue arising under this Agreement shall be conclusive and binding on all
persons having an interest in this option.
17. Governing Law. The interpretation, performance, and enforcement
of this Agreement shall be governed by the laws of the State of Missouri.
18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
in duplicate on its behalf by its duly authorized officer and You have also
executed this Agreement in duplicate, all as of the day and year indicated
above.
COMPANY
By: ______________________________
Title: ______________________________
Address:______________________________
______________________________
You: ______________________________
Address:______________________________
______________________________
EXHIBIT A
STOCK PURCHASE AGREEMENT
This Agreement is made as of this ______ day of _________________, _____,
by and among Huntco Inc. (the "Company") and __________________________ ("You"
or "Your"), the holder of a stock option under the Stock Option Agreement
("Option Agreement") and _________________________ , Your spouse.
I. EXERCISE OF OPTION
1.1 Exercise. You hereby purchase ______ shares of Class A Common
Stock of the Company ("Purchased Shares") pursuant to that certain option
("Option") granted to You on _________________________ ("Grant Date") under
the Option Agreement to purchase up to _______ shares of the Company's Class A
Common Stock (the "Optioned Shares") at an option price of $_______
(________________ dollars) per share (the "Option Price").
1.2 Payment. Concurrently with the delivery of this Agreement to the
Secretary of the Company, You shall pay the aggregate Option Price for the
Purchased Shares and the withholding amount in accordance with the provisions
of the Option Agreement, and shall deliver whatever additional documents may
be required by the Option Agreement as a condition for exercise.
II. MISCELLANEOUS PROVISIONS
3.1 Power of Attorney. Your spouse hereby appoints You his or her
true and lawful attorney in fact, for him or her and in his or her name, place
and xxxxx, and for his or her use and benefit, to agree to any amendment or
modification of this Agreement and to execute such further instruments and
take such further actions as may reasonably be necessary to carry out the
intent of this Agreement. Your spouse further gives and grants unto You as
his or her attorney in fact full power and authority to do and perform every
act necessary and proper to be done in the exercise of any of the foregoing
powers as fully as he or she might or could do if personally present, with
full power of substitution and revocation, hereby ratifying and confirming all
that You shall lawfully do and cause to be done by virtue of this power of
attorney.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and
year first indicated above.
COMPANY
By: ______________________________
Title: ______________________________
Address:______________________________
______________________________
You: ______________________________
Address:______________________________
______________________________
Your Spouse:__________________________
Address:______________________________
______________________________
