1
Exhibit 4.6
NONQUALIFIED STOCK OPTION AGREEMENT
THIS NONQUALIFIED STOCK OPTION AGREEMENT is made as of the date set forth on the
signature page hereof by and between Universal Electronics Inc., a Delaware
corporation (the "Corporation") and the undersigned Optionee (the "Optionee").
As used in this Agreement, the term "Corporation" shall include, where
applicable, any and all of its subsidiaries.
WHEREAS, the Board of Directors of the Corporation (the "Board") has approved
the Universal Electronics Inc. 1999A NonQualified Stock Plan (the "Plan"); and
WHEREAS, the Corporation desires to grant to the Optionee an option ("Option")
to purchase shares of the Corporation's common stock, par value $0.01 per share
(the "Stock"), upon the terms and conditions set forth in this Agreement;
NOW, THEREFORE, the parties, intending to be legally bound, hereto agree as
follows:
1. GRANT AND DESIGNATION OF OPTION. Upon the execution and delivery of
this Agreement and the related Stock Option Certificate of even date
herewith (the "Certificate"), the Corporation hereby grants to the
Optionee the Option to purchase the aggregate number of shares of Stock
set forth on the Certificate at the price per share ("Option Price")
further set forth on the Certificate. The Option granted hereunder
shall not be treated as an incentive stock option within the meaning of
Section 422A of the Internal Revenue Code of 1986, as amended.
2. TERM AND EXERCISE OF OPTION. Subject to earlier termination,
acceleration or cancellation of the Option as provided herein, the term
of the Option shall be for that period of time also set forth on the
Certificate (the "Option Period") and, subject to the provisions of
this Agreement, the Option shall be exercisable at such times and as to
such number of shares as determined on the schedule set forth on the
Certificate.
3. METHOD OF EXERCISE. The Option may be exercised by written notice to
the Corporation (the "Exercise Notice") at its offices at 0000 Xxxxxxx
Xxxxx, Xxxxxxx, Xxxxxxxxxx 00000 to the attention of the Secretary of
the Corporation. The Exercise Notice shall state (i) the election to
exercise the Option, (ii) the total number of full shares in respect to
which it is being exercised, and (iii) shall be signed by the person or
persons exercising the Option. The Exercise Notice shall be accompanied
by the Certificate and a certified or cashier's check for the full
amount of the purchase price of such shares, or as may be permitted by
the Board, by certificates for shares of Stock which have been owned by
the Optionee for more than six months prior to the date of exercise and
which have a fair market value of the date of exercise equal to the
purchase price, or by a combination of such methods of payment. Upon
receipt of the foregoing, the Corporation shall issue the shares of
Stock as to which the Option has been duly exercised and shall return
the Certificate, duly endorsed to reflect such exercise, to the
Optionee.
4. OPTIONEE'S REPRESENTATIONS.
(a) Optionee represents and warrants that any and all shares acquired
through the exercise of rights under the Option granted pursuant to
this Agreement will be acquired for Optionee's own account and not with
a view to, or present intention of, distribution thereof in violation
of the Securities Act of 1933, as amended and the rules and regulations
promulgated thereunder (the "1933 Act") and will not be disposed of in
contravention of the 1933 Act.
(b) Optionee acknowledges that Optionee is able to bear the economic
risk of the investment in any and all shares of Stock acquired through
the exercise of rights under the Option for an indefinite period of
time because the Stock may not be registered under the 1933 Act and, if
not, cannot be sold unless subsequently registered under the 1933 Act
or an exemption from such registration is available.
2
(c) Optionee has reviewed this Agreement and has had an opportunity to
ask questions and receive answers concerning the terms and conditions
of the offering of Stock and has had full access to such other
information concerning the Corporation as Optionee has requested.
5. RESTRICTION ON EXERCISE. This Option may not be exercised if the
issuance of such shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any
applicable federal or state securities or other law or regulation. As a
condition to the exercise of this Option, the Corporation may require
Optionee to make any representation and warranty to the Corporation as
may be required by any applicable law or regulation. All exercises of
the Option must be for full shares of Stock only.
6. EFFECT OF TERMINATION OF EMPLOYMENT. Except as set forth in Paragraphs
7, 8 and 9 below, in the event that Optionee's employment with the
Corporation ceases for any reason, Optionee may (or Optionee's estate
or representative, in the event of Optionee's death during the
applicable exercise period as set forth in this Paragraph 6), during
the earlier of (i) the 180 day period following such cessation of
employment or (ii) the remaining term of the Option Period, exercise
the Option to the extent such Option was exercisable on the date such
employment ceased and, on such date, that portion of the Option which
was not exercisable shall automatically terminate without further
action by the parties hereto and, in all events, to the extent not
exercised, the Option shall terminate in its entirety at the end of
business on the applicable exercise period as set forth in this
Paragraph 6.
7. EFFECT OF TERMINATION OF EMPLOYMENT WITHOUT CAUSE OR DUE TO
CONSTRUCTIVE TERMINATION.
(a) In the event that Optionee's employment with the Corporation is
terminated by the Corporation without "Cause" (as such term is defined
in subparagraph 7(b) below) or in the event of "Constructive
Termination" (as such term is defined in subparagraph 7(c) below),
Optionee shall become immediately fully vested in the Option without
further action by the parties hereto, and, to the extent not previously
exercised, shall be exercisable in whole or in part with respect to all
remaining shares of Stock covered by the Option and may be exercised by
Optionee (or Optionee's estate or representative, in the event of
Optionee's death) at any time prior to the expiration of the Option
Period.
(b) For purposes of this Agreement, "Cause" shall mean (i) the willful
and continued failure by Optionee to substantially perform Optionee's
duties with the Corporation (other than a failure resulting from
Optionee's death or "Total Disability," as such term is defined in
subparagraph 7(e) below) after a demand for substantial performance is
delivered to Optionee by the Corporation which specifically identifies
the manner in which it is believed that Optionee has not substantially
performed Optionee's duties; (ii) the willful engaging by Optionee in
gross misconduct materially and demonstrably injurious to the property
or business of the Corporation; or (iii) Optionee's commission of
fraud, misappropriation or a felony. For purposes of this definition of
"Cause", no act or failure to act on Optionee's part will be considered
"willful" unless done, or omitted to be done, by Optionee not in good
faith and without reasonable belief that Optionee's action or omission
was in the interests of the Corporation or not opposed to the interests
of the Corporation.
(c) For purposes of this Agreement, "Constructive Termination" shall
occur on that date on which Optionee resigns from employment with the
Corporation, if such resignation occurs within eighteen (18) months
after the occurrence of (i) the failure of Optionee to be elected or
re-elected or appointed or reappointed to such office which Optionee
holds (other than as a result of a termination for "Cause") if Optionee
is an officer of the Corporation and the office which Optionee holds is
one to which Optionee is elected according to the Corporation's
By-laws; (ii) a change in Optionee's functions, duties, or
responsibilities such that Optionee's position with the Corporation
becomes substantially less in responsibility, importance, or scope; or
(iii) a "Change in Control" (as such term is defined in subparagraph
7(d) below).
(d) For purposes of this Agreement, a "Change in Control" shall be
deemed to occur when (i) any "person" or "group" (as such terms are
used in Sections 3(a), 13(d) and 14(d) of the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated
thereunder (the "1934 Act")), other
2
3
than (1) a trustee or other fiduciary holding securities under any
employee benefit plan of the Corporation or (2) a corporation owned
directly or indirectly by the stockholders of the Corporation in
substantially the same proportions as their ownership of Stock in the
Corporation immediately prior to any such occurrence, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, of securities of the Corporation representing
20% or more of the total voting power of the then outstanding
securities of the Corporation entitled to vote generally in the
election of directors (the "Voting Stock"); (ii) individuals who are
members of the Board on the date of this Agreement and any individual
who becomes a member of the Board hereafter whose nomination for
election as a director was approved by the affirmative vote of a
majority of such Directors, cease to constitute a majority of the
members of the Board; (iii) there occurs a merger or consolidation of
the Corporation with any other corporation or entity, other than a
merger or consolidation which would result in the Voting Stock of the
Corporation immediately outstanding prior thereto continuing to
represent (either by remaining outstanding or by being converted into
voting securities of the surviving entity) at least 80% of the total
voting power represented by the Voting Stock or the voting securities
of such surviving entity outstanding immediately after such merger or
consolidation; (iv) there occurs a sale or transfer or disposition of
all or substantially all of the Corporation's assets to any other
corporation or entity, other than a corporation owned directly or
indirectly by the stockholders of the Corporation in substantially the
same proportions as their ownership of Stock in the Corporation
immediately prior to such sale, transfer or disposition; or (v) the
dissolution or liquidation of the Corporation.
(e) For purposes of this Agreement, "Total Disability" shall mean an
event of illness or other incapacity of Optionee resulting in
Optionee's failure or inability to discharge Optionee's duties as an
employee of the Corporation for ninety (90) or more days during any
period of 120 consecutive days.
8. EFFECT OF TERMINATION OF EMPLOYMENT DUE TO DEATH OR TOTAL DISABILITY.
In the event that Optionee's employment with the Corporation ceases or
is terminated due to Optionee's death or Total Disability, Optionee (or
Optionee's estate or representative, in the event of Optionee's death)
may during the earlier of (i) the one (1) year period following such
cessation or termination of employment or (ii) the remaining term of
the Option Period, exercise the Option to the extent such Option was
exercisable on the date such employment ceased or was terminated and,
on such date, that portion of the Option which was not exercisable
shall automatically terminate without further action by the parties
hereto and, in all events, to the extent not exercised, the Option
shall terminate in its entirety at the end of business on the
applicable exercise period as set forth in this Paragraph 8; PROVIDED,
HOWEVER, the Board, in its sole discretion, may approve the full
vesting to Optionee (or Optionee's estate or representative, in the
event of Optionee's death) in the Option and, in such event, to the
extent not previously exercised, the Option shall be exercisable in
whole or in part with respect to all remaining shares of Stock covered
the Option and may be exercised by Optionee (or Optionee's estate or
representative, in the event of Optionee's death) at any time prior to
the expiration of the Option Period.
9. EFFECT OF TERMINATION OF EMPLOYMENT FOR CAUSE. In the event that
Optionee's employment with the Corporation is terminated by the
Corporation for Cause, the Option, to the extent not then exercised
(and whether or not then exercisable in whole or in part) shall
automatically and immediately terminate in its entirety as of the date
of such termination of employment, without further action by Optionee
or the Corporation, and Optionee thereafter shall have no rights
whatsoever with respect to the Option.
10. RIGHT OF A STOCKHOLDER. Optionee shall not have any rights as a
stockholder with respect to any shares of Stock unless and until
legended certificates for such shares of such Stock are issued or
unless the Optionee has been granted additional applicable rights under
the Plan.
11. WITHHOLDING OF TAXES. Whenever the Corporation is required to issue
shares of Stock upon exercise hereunder, the Corporation shall have the
right to require the recipient to remit in cash (or with the consent of
the Board, shares of Stock previously owned by the recipient or
issuable upon such exercise) to the Corporation an amount sufficient to
satisfy any federal, state and/or local withholding tax requirements
prior to the delivery of any certificate or certificates for such
shares of Stock.
3
4
12. ADJUSTMENTS. In the event of any change in the outstanding shares of
Stock of the Corporation by reason of a stock dividend or distribution,
recapitalization, spin-off, merger, consolidation, split-up,
combination, exchange of shares or the like, the Board shall adjust the
number of shares of Stock which may be issued under the Plan and shall
provide for an equitable adjustment to (a) the number of shares of
Stock subject to this Agreement and (b) the option price of this Stock
Option.
13. COMPLIANCE WITH CERTAIN LAWS AND REGULATIONS. If the Board shall
determine, in its sole discretion, that the listing, registration or
qualification of the shares subject to the Option upon any securities
exchange or under any law or regulation, or that the consent or
approval of any governmental regulatory body is necessary or desirable
in connection with the granting of the Option or the acquisition of
shares thereunder, the Optionee shall supply the Board or the
Corporation, as the case may be, with such certificates,
representations and information as the Board or the Corporation, as the
case may be, may request and shall otherwise cooperate with the
Corporation in obtaining any such listing, registration, qualification,
consent or approval.
14. TRANSFERABILITY OF OPTION. The Option is not transferable by the
Optionee other than (i) by will or by the laws of descent and
distribution or (ii) by gift or domestic relations order to a family
member of the Optionee (a "Permitted Transferee"), and is exercisable,
during the Optionee's lifetime, only by a Permitted Transferee, the
Optionee, or in the case of Optionee's legal incompetency, by
Optionee's guardian or legal representative.
15. ADDITIONAL RESTRICTIONS ON TRANSFER. The certificates representing the
Stock purchased upon the exercise of the Option will bear the following
legend until such shares of Stock have been registered under an
effective registration statement under the 1933 Act:
The securities represented by this certificate were originally
issued on _____________________, 19___, have not been
registered under the Securities Act of 1933, as amended, or
under the securities laws of any state or other jurisdiction
(together, the "Securities Laws") and may not be offered for
sale, sold or otherwise transferred or encumbered in the
absence of compliance with such Securities Laws and until the
issuer hereof shall have received from counsel acceptable to
issuer a written opinion reasonably satisfactory to issuer
that the proposed transaction will not violate any applicable
Securities Laws.
16. NOTICES. Any notice or demand provided for in this Agreement must be in
writing and must be either personally delivered, delivered by overnight
courier, or mailed by first class mail, to the Optionee at Optionee's
most recent address on file in the records of the Corporation, to the
Corporation at the address set forth or established pursuant to
Paragraph 3 or to such other address or to the attention of such other
person as the recipient party shall have specified by prior written
notice to the sending party. Any notice or demand under this Agreement
will be deemed to have been given when received.
17. SEVERABILITY. This Agreement and each provision hereof shall be valid
and enforced to the fullest extent permitted by law. The invalidity or
unenforceability of any provision of this Agreement shall not affect
the validity or enforceability of any other provision. Without limiting
the generality of the foregoing, if the scope of any provision
contained in this Agreement is too broad to permit enforcement to its
fullest extent, such provision shall be enforced to the maximum extent
permitted by law, and the parties hereby agree that such scope may be
judicially modified accordingly.
18. COMPLETE AGREEMENT. This Agreement and those documents expressly
referred to herein embody the complete agreement and understanding
among the parties and supersede and preempt any prior understandings,
agreements or representations by or among the parties, written or oral,
which may have related to the subject matter hereof in any way.
19. COUNTERPARTS. This Agreement may be executed in separate counterparts,
each of which shall be deemed an original and all of which taken
together shall constitute one and the same agreement.
4
5
20. SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and inure to
the benefit of and be enforceable by Optionee, the Corporation and
their respective permitted successors and assigns (including personal
representatives, heirs and legatees), and is intended to bind all
successors and assigns of the respective parties, except that Optionee
may not assign any of Optionee's rights or obligations under this
Agreement except to the extent and in the manner expressly permitted
hereby.
21. REMEDIES. Each of the parties to this Agreement will be entitled to
enforce its rights under this Agreement specifically, to recover
damages by reason of any breach of any provision of this Agreement and
to exercise all other rights existing in its favor. The parties hereto
agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and that any party
may, in its sole discretion, apply to any court of law or equity of
competent jurisdiction for specific performance and/or injunctive
relief in order to enforce or prevent any violations of the provisions
of this Agreement, without the necessity of posting bond or any other
security.
22. WAIVER OR MODIFICATION. Any waiver or modification of any of the
provisions of this Agreement shall not be valid unless made in writing
and signed by the parties hereto. A waiver by either party of any
breach of this Agreement shall not operate as a waiver of any
subsequent breach.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
____ day of _________________, _____.
OPTIONEE UNIVERSAL ELECTRONICS INC.
By:
------------------------ ----------------------------
Signature Its: Chairman and Chief
Executive Officer
Print Name
5
6
Certificate Number: ____
UNIVERSAL ELECTRONICS INC.
1999A NONQUALIFIED STOCK PLAN
STOCK OPTION CERTIFICATE
THIS CERTIFIES THAT ____________has been awarded an OPTION to purchase ________
shares of common stock, par value $0.01 per share, of UNIVERSAL ELECTRONICS INC.
at a price per share of $____. This Certificate is issued in accordance with and
is subject to the terms and conditions of the related NonQualified Stock Option
Agreement of even date herewith (the "Agreement").
THIS OPTION is not transferable except in accordance with the terms and
conditions of the Agreement.
THIS OPTION shall expire [ten (10)] years from the date of this Certificate.
THIS OPTION shall be exercisable as to all or a portion of the number of shares
set forth above as follows:
On and After the Following Maximum Percentage Taking
Dates, But Prior to Expiration Into Account Prior Exercises
__/__/00 25%
__/__/01 50%
__/__/02 75%
__/__/03 100%
IN WITNESS WHEREOF, UNIVERSAL ELECTRONICS INC. has caused this Stock Option
Certificate to be signed by its duly authorized officer as of the ____ day of
______, _____.
UNIVERSAL ELECTRONICS INC.
By:______________________________
Its:______________________________
6
