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EXHIBIT 10.23
NONQUALIFIED STOCK OPTION GRANT AGREEMENT
GRANTED TO: Xxxxx X. Xxxxx, Xx.
DATE OF GRANT: March 10, 1998
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: 238,895 shares
EXERCISE PRICE: $18.00 per share
VESTING SCHEDULE: 88,890 shares become exercisable on
September 25, 1998, an additional 94,445
shares become exercisable on September 25,
1999, and an additional 55,560 shares become
exercisable on September 25, 2000.
1. This Nonqualified Stock Option Grant Agreement (the "Agreement") is
made and entered into as of March 10, 1998 (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 between the Company and the Employee dated March 10, 1998 ("Employment
Agreement"). It is the intent of the Company and the Employee that the Option
(as defined in Paragraph 2 below) will not qualify as an "incentive stock
option" under Section 422 of the Internal Revenue Code of 1986, as amended from
time to time.
2. The Employee is granted an option to purchase 238,895 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 Agreements, the
provisions of which are incorporated herein by reference. 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.
88,890 shares shall become exercisable on September 25, 1998
and shall remain exercisable until the 10th
anniversary of the Date of Grant;
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94,445 shares shall become exercisable on September 25, 1999
and shall remain exercisable until the 10th
anniversary of the Date of Grant; and
55,560 shares shall become exercisable on September 25, 2000
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. Notwithstanding the preceding two
sentences, the Option may be transferred by the Employee solely to his spouse,
siblings, parents, children and/or grandchildren or trusts for the benefit of
such persons or partnerships, limited liability companies or other entities
owned soley by such persons subject to any restrictions otherwise applicable to
the Option.
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 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 Company for any taxes required by any government to be withheld or
otherwise deducted and paid by the Company with respect to the issuance or
disposition of the shares subject to the Option. In lieu thereof, the Company
shall have the right to withhold the amount of such taxes from any other sums
due or to become due from the Company to the Employee. The Company 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.
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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.
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
DATED: December 21, 1998. By /s/ Xxxx X. Xxxxxxxxxx
_________________________
Xxxx X. Xxxxxxxxxx
ACCEPTED this 21 day of December, 1998:
/s/ Xxxxx X. Xxxxx, Xx.
_______________________________
XXXXX X. XXXXX, XX.
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