EXHIBIT 4.2
Stock Option Agreement of Xxxxxx X. Xxxxxxx
GKN HOLDING CORP.
STOCK OPTION AGREEMENT
AGREEMENT, made as of the 2nd day of August 1996, between GKN HOLDING
CORP., a Delaware corporation ("Company"), and Xxxxxx X. Xxxxxxx ("Director" or
"Grantee").
WHEREAS, on May 30, 1996, the Board of Directors of the Company or a
committee thereof (in either event, "Company") authorized the grant to the
Director of an option to purchase an aggregate of 10,000 of the authorized but
unissued or treasury shares of the Common Stock of the Company ("Common Stock")
on the terms and conditions set forth in this Agreement.
WHEREAS, the Director desires to acquire said option on the terms and
conditions set forth in this Agreement;
IT IS AGREED:
1. The Company hereby grants to the Director the right and option to
purchase all or any part of an aggregate of 10,000 shares of the Common Stock on
the terms and conditions set forth herein ("Option"). The Option is not intended
to qualify as an "incentive stock option" under section 422 of the Internal
Revenue Code of 1986, as amended ("Code").
2. The purchase price of each share of Common Stock subject to the Option
("Option Shares") shall be $6.00, equal to the per share offering price in the
Company's 1996 Initial Public Offering.
3. (a) The Option shall become exercisable on the day the Grantee becomes a
director of the Company, which shall occur upon the consummation of the
Company's Initial Public Offering. No Option Shares may be purchased hereunder
prior to such date. After the Option becomes exercisable, it shall remain
exercisable, for a period of ten years.
(b) The Option shall not be assignable or transferable except in the event
of the death of the Director, by will or by the laws of descent and
distribution. No transfer of the Option by the Director by will or by the laws
of descent and distribution shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and a copy of the
will and such other evidence as the Company may deem necessary to establish the
validity of the transfer and the acceptance by the transferee or transferees of
the terms and conditions of the Option.
4. The Director shall not have any of the rights of a stockholder with
respect to the Option Shares until such shares have been issued after the due
exercise of the Option.
5. In the event of any recapitalization, reclassification, stock dividend,
stock split, or other change in the corporate structure affecting the class of
Common Stock as a whole, the Company shall proportionally adjust the number and
kind of shares covered by the Option and the option price thereunder; provided,
that the number of adjusted Option Shares, if any, shall always be rounded up to
the next whole number.
6. The Company hereby represents and warrants to the Director that the
Option Shares, when issued and delivered by the Company to the Director in
accordance with the terms and conditions hereof will be duly and validly issued,
fully paid and non-assessable.
7. The Director hereby represents and warrants to the Company that he is
acquiring the Option and shall acquire the Option Shares for his own account and
not with a view to the distribution thereof.
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8. Anything in this Agreement to the contrary notwithstanding, the Director
hereby agrees that he shall not sell, transfer by any means or otherwise dispose
of the Option Shares acquired by him without registration under the Securities
Act of 1933, as amended ("Act"), or in the event that they are not so
registered, unless (a) an exemption from the Act is available thereunder, and
(b) the Director has furnished the Company with notice of such proposed transfer
and the Company's legal counsel, in its reasonable opinion, shall deem such
proposed transfer to be so exempt.
9. The Director hereby acknowledges that:
(a) All reports and documents required to be filed by the Company with the
National Association of Securities Dealers, Inc. and Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934 and other applicable
laws within the last 12 months have been made available to the Director for his
inspection.
(b) If he exercises the Option, he must bear the economic risk of the
investment in the Option Shares for an indefinite period of time because the
Option Shares will not have been registered under the Act and cannot be sold by
him unless they are registered under the Act or an exemption therefrom is
available thereunder.
(c) In his position with the Company, he has had both the opportunity to
ask questions of and receive answers from the officers and directors of the
Company and all persons acting on its behalf concerning the terms and conditions
of the offer made hereunder and to obtain any additional information to the
extent the Company possesses or may possess such information or can acquire it
without unreasonable effort or expense necessary to verify the accuracy of the
information obtained pursuant to subparagraph (a) above.
(d) The Company shall place stop transfer orders with its transfer agent
against the transfer of the Option Shares in the absence of registration under
the Act or an exemption therefrom.
(e) The certificates evidencing the Option Shares shall bear the following
legend:
"The shares represented by this certificate have been acquired
for investment and have not been registered under the
Securities Act of 1933. The shares may not be sold or
transferred in the absence of such registration or an
exemption therefrom under said Act."
10. Subject to the terms and conditions of the Agreement, the Option may be
exercised by written notice to the Company at its principal place of business.
Such notice shall state the election to exercise the Option and the number of
Option Shares in respect to which it is being exercised, shall contain a
representation and agreement by the person or persons so exercising the Option
that the Option Shares are being purchased for investment and not with a view to
the distribution or resale thereof, and shall be signed by the person or persons
so exercising the Option. Such notice shall be accompanied by payment of the
full purchase price of the Option Shares in cash or by bank or certified check,
unless otherwise agreed to by the Company. The Company shall issue a certificate
or certificates evidencing the Option Shares as soon as practicable after the
notice and payment is received. The certificate or certificates evidencing the
Option Shares shall be registered in the name of the person or persons so
exercising the Option.
11. All notices, requests, deliveries, payments, demands and other
communications which are required or permitted to be given under this Agreement
shall be in writing and shall either be delivered personally or sent by
certified mail, return receipt requested, postage prepaid, to the parties at
their respective addresses set forth below, or to such other address as either
shall have specified by notice in the writing to the other, and shall be deemed
duly given hereunder when so delivered or mailed, as the case may be.
12. The waiver by any party hereto of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any other or
subsequent breach.
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13. This Agreement constitutes the entire agreement between the parties
with respect to the subject matter thereof.
14. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and to the extent not prohibited herein, their respective heirs,
successors, assigns and representatives. Nothing in this Agreement, expressed or
implied, is intended to confer on any person other than the parties hereto and
as provided above, their respective heirs, successors, assigns and
representatives any rights, remedies, obligations or liabilities.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have signed this
Agreement as of the 2nd day of August, 1996.
GKN HOLDING CORP.
By: /s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx
Chief Operating Officer
DIRECTOR:
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
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