Exhibit 10.2.23
CHARMING SHOPPES, INC.
AMENDED AND RESTATED 2000 ASSOCIATES' STOCK INCENTIVE PLAN
STOCK OPTION AGREEMENT
Agreement dated as of February 11, 2002 between CHARMING SHOPPES, INC. (the
"Company") and [first] [last] (the "Associate").
It is agreed as follows:
1. GRANT OF OPTION; CONSIDERATION
The Company hereby confirms the grant, under and pursuant to the Company's
Amended and Restated 2000 Associates' Stock Incentive Plan (the "Plan"), to the
Associate on [grantdate] of a nonqualified stock option to purchase up to
*[shares]* shares of the Company's common stock, par value $.10 per share (the
"Shares"), at an exercise price of [optionprice] per share (the "Option"). The
Option granted hereunder is not intended to constitute an incentive stock option
within the meaning of Section 422 of the Code.
The Associate shall be required to pay no consideration for the grant of
the Option except for his or her agreement to provide services to the Company
prior to exercise and other agreements set forth herein.
2. INCORPORATION OF PLAN BY REFERENCE
The Option has been granted to the Associate under the Plan, a copy of
which is attached hereto. All of the terms, conditions and other provisions of
the Plan are hereby incorporated by reference into this Associate Stock Option
Agreement (the "Agreement"). Capitalized terms used in this Agreement but not
defined herein shall have the same meanings as in the Plan. If there is any
conflict between the provisions of this Agreement and the provisions of the
Plan, the provisions of the Plan shall govern.
3. DATE WHEN EXERCISABLE
(a) This Option may not be exercised unless and only to the extent that it
has become exercisable as specified in this Agreement. Subject to acceleration
as provided in this Section 3, and Sections 7 and 8 below, limitations on
exercisability imposed in Section 8 below, and all other terms and conditions of
this Agreement, this Option shall become exercisable as follows: The Associate
may purchase up to one-third of the total number of shares granted hereunder
commencing one (1) year after the date of grant of this Option, an additional
one-third commencing two (2) years after the date of grant of this Option, an
additional one-third commencing three (3) years after the date of grant of this
Option. Except as otherwise specifically provided herein, the Option to purchase
any and all Shares covered by this Agreement shall expire at 5:00 p.m. on the
date five (5) years after the date of grant of this Option.
(b) The number of Shares with respect to which the Option may be exercised
shall be cumulative so that if, in any of the aforementioned periods, the full
number of Shares shall not have been purchased, any such unpurchased Shares
shall continue to be included in the number of Shares with respect to which this
Option shall then be exercisable along with any other Shares as to which this
Option may become exercisable in accordance with its terms.
--------------------------------------------------------------------------------
THE DATE OF GRANT OF THIS OPTION IS: [grantdate]
GRANT NUMBER: [grantnumber]
(c) The provisions contained in Section 3(a) above notwithstanding, the
Committee may, in its sole discretion, at any time, upon written notice to the
Associate, accelerate the vesting described in Section 3(a) so that the Option
shall become immediately exercisable to the extent of all or any portion of the
Shares covered hereunder. Acceleration pursuant to this Section 3(c) shall be
separate and independent from any acceleration pursuant to Section 7 of this
Agreement, and the provisions of Sections 3(d) and (e) shall not apply in the
case of acceleration pursuant to Section 7 of this Agreement.
(d) In the event that the acceleration described in Section 3(c) occurs
prior to the time that all of the Options would have otherwise been exercisable
in accordance with Section 3(a), in consideration of such acceleration, the
Associate, if so requested by the Company at the time, agrees to hold and not
dispose of that number of Shares covered by this Option for which this Option
would not have been exercisable at the time of such acceleration, if such
acceleration had not occurred, and further agrees to dispose of such Shares only
at such time and to the extent of that number of Shares for which this Option
would have been exercisable in accordance with the schedule set forth in Section
3(a) as if the acceleration had not occurred. In addition, if the Associate's
employment with the Company or any of its subsidiaries shall be voluntarily
terminated (other than for a temporary leave of absence approved by the Company
or retirement at age 65 or older or through early retirement with the consent of
the Company pursuant to any retirement plan of the Company or any subsidiary)
prior to a Change of Control and prior to the expiration of three (3) years
after the date of grant of this Option, the Associate shall be obligated, at the
Company's option exercisable within 60 days after termination of the Associate's
employment, to sell to the Company any Shares theretofore acquired by the
Associate upon exercise of this Option at a price which is equal to the price
that the Associate paid for such Shares, but only to the extent that the Option
would not have been exercisable at the date of termination of employment in
accordance with Section 3(a) were it not for the acceleration provided for
herein.
(e) The Associate acknowledges that the certificates representing those
Shares received upon exercise of the Option at a time the Option would not
otherwise have been exercisable but for an acceleration pursuant to Section 3(c)
may bear an appropriate legend giving notice of the foregoing restrictions,
including the restriction on transfer of the Shares.
4. METHOD OF EXERCISE
The Option may be exercised as to any part of the Shares which may then be
purchased by delivery to and receipt by the Secretary of the Company at 000
Xxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxxx 00000, of a written notice, signed by the
Associate, specifying the number of Shares which the Associate wishes to
purchase, accompanied by payment in full of the exercise price therefor in
accordance with Section 5. As soon as practicable after the receipt of such
notice and payment, the Company shall deliver to the Associate a stock
certificate for the Shares so purchased, with any requisite legend affixed.
Subject to the provisions of the Plan, such exercise may include instructions to
the Company to deliver Shares due upon exercise of the Option to any registered
broker or dealer designated by the Committee (a "Designated Broker") in lieu of
delivery to the Associate. Such instructions must designate the account into
which the Shares are to be deposited. The Associate may tender this notice of
exercise, which has been properly executed by the Associate, and the
aforementioned delivery instructions to any Designated Broker together with
irrevocable instructions to the Designated Broker to promptly deliver to the
Company the cash amount of sale or loan proceeds from the Shares sufficient to
pay the exercise price, and thereupon the Company may issue Shares and deliver
them to such Designated Broker.
5. PAYMENT OF EXERCISE PRICE
The exercise price of the Option shall be payable in cash or by certified
or bank cashier's check, provided, however, that, in lieu of payment in full in
cash or by such check, the exercise price may, if and to the extent then
permitted by the Committee, upon written request of the Associate, be paid in
full or in part by delivery and transfer to the Company of that number of shares
of the Company's common stock otherwise owned by the Associate with an aggregate
fair market value (determined in accordance with procedures for valuing shares
as set forth in rules and
2
regulations adopted by the Committee and in effect at the time the Associate's
notice of exercise is received by the Company) equal to the aggregate exercise
price of that number of Shares for which the Option is being exercised or such
lesser portion of the aggregate purchase price as may be specified by the
Associate (in which case the balance must be paid in cash or by certified or
bank cashier's check).
6. TAX WITHHOLDING
Whenever Shares are to be delivered upon exercise of the Option, the
Company shall be entitled to require as a condition of delivery that the
Associate remit or, in appropriate cases, agree to remit when due an amount
sufficient to satisfy all federal, state and local withholding tax requirements
relating thereto. Subject to the approval of the Committee, the Associate will
be entitled to elect to have the Company withhold from the Shares to be
delivered upon the exercise of the Option, or to elect to deliver to the Company
from shares of the Company's common stock owned separately by the Associate, a
sufficient number of such shares to satisfy the Associate's federal, state and
local tax obligations relating to the Option exercise (and the Company's
withholding obligations), to the extent, if any, permitted under rules and
regulations adopted by the Committee and in effect at the time of the exercise
of the Option. In such case, the Shares withheld or the shares surrendered will
be valued at the fair market value determined in accordance with procedures for
valuing shares as set forth in rules and regulations adopted by the Committee
and otherwise in effect at the time of the exercise of the Option.
7. CHANGE OF CONTROL PROVISIONS
(a) Acceleration of Exercisability. In the event of a Change of Control at
a time that the Associate is employed by the Company or any of its subsidiaries
and after the date of grant of this Option, this Option shall become immediately
and fully exercisable immediately prior to the occurrence of such Change of
Control, and no restriction or limitation on the rights of the Associate set
forth in Section 3 hereof (other than the stated expiration date) shall have any
further force or effect.
(b) Definitions of Certain Terms. For purposes of this Agreement, the
following definitions shall apply:
(1) "Beneficial Owner," "Beneficially Owns," and "Beneficial
Ownership" shall have the meanings ascribed to such terms for purposes of
Section 13(d) of the Exchange Act and the rules thereunder, except that,
for purposes of this Section 7, "Beneficial Ownership" (and the related
terms) shall include Voting Securities that a Person has the right to
acquire pursuant to any agreement, or upon exercise of conversion rights,
warrants, options or otherwise, regardless of whether any such right is
exercisable within 60 days of the date as of which Beneficial Ownership is
to be determined.
(2) "Change of Control" means and shall be deemed to have occurred if
(i) any Person, other than the Company or a Related Party,
acquires directly or indirectly the Beneficial Ownership of any Voting
Security of the Company and immediately after such acquisition such
Person has, directly or indirectly, the Beneficial Ownership of Voting
Securities representing 20 percent or more of the total voting power
of all the then-outstanding Voting Securities; or
(ii) those individuals who as of [grantdate] constitute the Board
or who thereafter are elected to the Board and whose election, or
nomination for election, to the Board was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who
either were directors as of [grantdate] or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority of the members of the Board; or
3
(iii) there is consummated a merger, consolidation,
recapitalization or reorganization of the Company, a reverse stock
split of outstanding Voting Securities, or an acquisition of
securities or assets by the Company (a "Transaction"), other than a
Transaction which would result in the holders of Voting Securities
having at least 80 percent of the total voting power represented by
the Voting Securities outstanding immediately prior thereto continuing
to hold Voting Securities or voting securities of the surviving entity
having at least 60 percent of the total voting power represented by
the Voting Securities or the voting securities of such surviving
entity outstanding immediately after such Transaction and in or as a
result of which the voting rights of each Voting Security relative to
the voting rights of all other Voting Securities are not altered; or
(iv) there is implemented or consummated a plan of complete
liquidation of the Company or sale or disposition by the Company of
all or substantially all of the Company's assets other than any such
transaction which would result in Related Parties owning or acquiring
more than 50 percent of the assets owned by the Company immediately
prior to the transaction.
(3) "Person" shall have the meaning ascribed for purposes of Section
13(d) of the Exchange Act and the rules thereunder.
(4) "Related Party" means (i) a majority-owned subsidiary of the
Company; or (ii) a trustee or other fiduciary holding securities under an
Associate benefit plan of the Company or any majority-owned subsidiary of
the Company; or (iii) a corporation owned directly or indirectly by the
shareholders of the Company in substantially the same proportion as their
ownership of Voting Securities; or (iv) if, prior to any acquisition of a
Voting Security which would result in any Person Beneficially Owning more
than ten percent of any outstanding class of Voting Security and which
would be required to be reported on a Schedule 13D or an amendment thereto,
the Board approved the initial transaction giving rise to an increase in
Beneficial Ownership in excess of ten percent and any subsequent
transaction giving rise to any further increase in Beneficial Ownership;
provided, however, that such Person has not, prior to obtaining Board
approval of any such transaction, publicly announced an intention to take
actions which, if consummated or successful (at a time such Person has not
been deemed a "Related Party"), would constitute a Change of Control.
(5) "Voting Securities" means any securities of the Company which
carry the right to vote generally in the election of directors.
8. TERMINATION OF EMPLOYMENT
(a) This Option shall terminate and no longer be exercisable at the earlier
of the scheduled expiration time of the Option, as set forth in Section 3(a)
above, or the earliest time specified below at or following a termination of
employment of the Associate; provided, however, that in the event of termination
of the employment of the Associate, this Option shall be exercisable during the
period, if any, between the occurrence of such termination and the time
designated for the termination of this Option only to the extent indicated
below:
4
(1) at the time of involuntary termination of the Associate's
employment with the Company or any of its subsidiaries for reasons of moral
turpitude, at which time this Option shall immediately terminate; provided,
however, that, the provisions of Section 3(a) notwithstanding, this Option
may not be exercised during any period prior to a Change of Control during
which the Company, having given notice to the Associate, is investigating a
claim that the Associate has engaged in one or more acts of moral
turpitude; or
(2) at the time of voluntary or involuntary termination of the
Associate's employment with the Company or any of its subsidiaries for any
reason at any time prior to the expiration of one year after the date of
grant of this Option and prior to any Change of Control, other than by
reason of the Associate's death or disability, at which time this Option
shall immediately terminate; or
(3) at the expiration of three months after the voluntary or, if for
cause (other than for reasons of moral turpitude), the involuntary
termination of the Associate's employment with the Company or any of its
subsidiaries, in either case at any time (A) after the expiration of one
year after the date of grant of this Option, except as may be otherwise
provided in Section 8(a)(7) below, during which three-month period this
Option shall be exercisable only to the extent that it was exercisable at
the date of the Associate's termination of employment, or (B) after a
Change of Control, except as may be otherwise provided in Section 8(a)(7)
below, during which three-month period this Option shall be exercisable in
full; or
(4) at the expiration of one year after the involuntary termination of
the Associate's employment, other than for reasons of cause, moral
turpitude, death or disability, with the Company or any of its subsidiaries
at any time (A) after the expiration of one year after the date of grant of
this Option, except as may be otherwise provided in Section 8(a)(7) below,
during which one-year period this Option shall be exercisable to purchase
the greater of (i) a number of Shares determined pursuant to the Option
Formula (as set forth in Section 8(e) below) and (ii) the number of Shares
as to which this Option was exercisable at the date of the Associate's
termination of employment, or (B) after a Change of Control, except as may
be otherwise provided in Section 8(a)(7) below, during which one-year
period this Option shall be exercisable in full; or
(5) at the stated expiration date of this Option, if the Associate's
termination results from his normal retirement at age 65 or thereafter
("Normal Retirement") or early retirement after reaching age 60 and prior
to age 65 with the consent of the Company pursuant to any retirement plan
("Early Retirement"), or such shorter period as may be provided in Section
8(a)(6) below, provided that (i) during the period between Normal
Retirement or Early Retirement, as the case may be, and termination of the
Option as specified in this Section 8(a)(5) (the "Exercisability Period"),
this Option shall continue to be exercisable by the Associate at such times
and to the same extent that it would have been exercisable had the
Associate continued his employment throughout the Exercisability Period,
except as may be otherwise provided in Section 8(a)(6) below, and (ii) at
the time of Normal Retirement or Early Retirement, as the case may be, the
Associate enters into an agreement not to engage, directly or indirectly,
in any business activity in competition with any business then engaged in
by the Company or any of its subsidiaries during the Exercisability Period,
and containing such other terms and conditions as may be specified by the
Company; or
(6) at the expiration of one year after the Associate's death if the
Associate dies while employed by the Company or any of its subsidiaries or
dies during the Exercisability Period specified in Section 8(a)(5) above,
during which one-year period this Option shall be exercisable in full; or
5
(7) at the expiration of one year after the Associate's death if the
Associate dies during the three-month period referred to in Section 8(a)(3)
or the one-year period referred to in Section 8(a)(4) above, during which
one-year period this Option shall be exercisable to the same extent
provided in Section 8(a)(3) or (4) above (whichever was applicable prior to
the Associate's death); or
(8) at the expiration of one year after the termination of the
Associate's employment with the Company or any of its subsidiaries by
reason of the Associate's permanent disability if the Associate becomes
permanently disabled while employed by the Company or any of its
subsidiaries, during which one-year period this Option shall be exercisable
in full.
(b) For purposes hereof, "cause" shall mean the Associate's chronic
neglect, refusal or failure to fulfill his or her employment duties and
responsibilities, other than for reasons of sickness, accident or other similar
causes beyond the Associate's control. Such neglect, refusal or failure shall be
determined in the sole and reasonable judgment of the Committee.
(c) For purposes hereof, the existence of a "disability" shall be
determined by, or in accordance with criteria and standards adopted by, the
Committee.
(d) For purposes hereof, "moral turpitude" shall mean the Associate's
dishonesty or intentional wrongdoing committed against the Company, its agents
or Associates or otherwise in connection with his or her employment by the
Company or conviction of a crime, whether or not in connection with employment,
other than a traffic infraction or other minor violation. The Committee shall
have the sole discretion to determine whether the Associate has committed an act
of moral turpitude.
(e) For purposes hereof, the "Option Formula" shall be the product of (i)
the total number of Shares covered by this Option at the date of termination of
employment times (ii) a fraction, the numerator of which shall be the lesser of
three (3) or the number of full and partial years that the Associate has been
employed by the Company or any of its subsidiaries between the date of grant of
this Option and the date of termination of employment and the denominator of
which shall be the number three (3), less any shares previously purchased by
exercise of the Option.
(f) Except as provided in Section 9, an Associate shall not be deemed to
have terminated his employment for purposes of this Section 8 if his employment
terminates with the Company but thereafter continues with one of the Company's
subsidiaries or terminates with a subsidiary but thereafter continues with the
Company or another subsidiary.
9. CHANGE IN JOB STATUS
Should the Associate's job classification change, and as a result of such
change the Committee determines, in its sole discretion and prior to any Change
of Control, that the Associate is no longer employed in a position which would
enable him to contribute to the success of the Company on at least as great a
level as that to which he was enabled by his prior job classification, then the
Committee may deem the Associate's employment with the Company or its
subsidiaries to have been terminated involuntarily (but not for cause or moral
turpitude) in respect of all or a portion of this Option.
10. LIMITS ON TRANSFER OF OPTION; BENEFICIARIES
No right or interest of Associate in this Option shall be pledged,
encumbered or hypothecated to or in favor of any third party or shall be subject
to any lien, obligation or liability of the Associate to any third party. This
Option shall not be transferable to any third party by the Associate otherwise
than by will or the laws of descent and distribution, and this Option shall be
exercisable, during the lifetime of the Associate, only by the Associate;
provided, however, that the Associate will be entitled to designate a
beneficiary or beneficiaries to exercise his rights under this Option upon the
death of Associate, in the manner and to the extent permitted by the Committee
under rules and regulations adopted by the Committee under the Plan.
6
11. INVESTMENT REPRESENTATION
Unless, at the time of any exercise of this Option, the issuance and
delivery of Shares hereunder to the Associate is registered under a
then-effective registration statement under the Securities Act of 1933, as
amended (the "Securities Act"), and complies with all applicable registration
requirements under state securities laws, the Associate shall provide to the
Company, as a condition to the valid exercise of this Option and the delivery of
any certificates representing Shares, appropriate evidence, satisfactory in form
and substance to the Company, that he is acquiring the Shares for investment and
not with a view to the distribution of the Shares or any interest in the Shares,
and a representation to the effect that the Associate shall make no sale or
other disposition of the Shares unless (i) the Company shall have received an
opinion of counsel satisfactory to it in form and substance that such sale or
other disposition may be made without registration under the then-applicable
provisions of the Securities Act, the related rules and regulations of the
Securities and Exchange Commission, and applicable state securities laws and
regulations, or (ii) the sale or other disposition of the Shares shall be
registered under a currently effective registration statement under the
Securities Act of 1933 and complies with all applicable registration
requirements under state securities laws. The certificates representing the
Shares may bear an appropriate legend giving notice of the foregoing restriction
on transfer of the Shares, and any other restrictive legend deemed necessary or
appropriate by the Committee.
12. ASSOCIATE BOUND BY PLAN
The Associate hereby acknowledges receipt of the attached copy of the Plan
and agrees to be bound by all the terms and provisions thereof (as presently in
effect or hereafter amended), and by all decisions and determinations of the
Committee thereunder.
13. MISCELLANEOUS
This Agreement shall be binding upon the heirs, executors, administrators
and successors of the parties. This Agreement constitutes the entire agreement
between the parties with respect to the Option, and supersedes any prior
agreements or documents with respect to the Option. No amendment, alteration,
suspension, discontinuation or termination of this Agreement which may impose
any additional obligation upon the Company or impair the rights of the Associate
with respect to the Option shall be valid unless in each instance such
amendment, alteration, suspension, discontinuation or termination is expressed
in a written instrument duly executed in the name and on behalf of the Company
and by the Associate.
CHARMING SHOPPES, INC.
BY:
--------------------------------------
(Authorized Officer)
ASSOCIATE:
--------------------------------------
[first][last]
7
