EXHIBIT 4.3 - FORM OF STOCK OPTION AGREEMENT
STOCK OPTION
AGREEMENT
XXXXX BROTHERS, INC., a Delaware corporation (the "Company"),
hereby grants to _________________ (the "Optionee") an option to purchase a
total of _________ shares of common stock, par value $.01 per share, of the
Company (the "Common Stock") at a price of $___________ per share.
1. Nature of the Option. This option is intended to be an
"Incentive Stock Option" as defined in and subject to the limitations of Section
422A of the Internal Revenue Code of 1986 and has been granted under the
Company's 1995 Stock Option Plan, as amended (the "Plan").
2. Exercise of Option.
a) This option may be exercised by delivery of written notice
to the Company stating the number of shares of Common Stock with respect to
which the option is being exercised, making such representations, warranties and
agreements with respect to such shares of Common Stock as may be required by the
Company, and accompanied by full payment of the purchase price therefor. Payment
may be made in cash, by check, by delivery of shares of Common Stock or in such
other form or combination of forms as shall be acceptable to the Company,
provided that any loan or guaranty by the Company of the purchase price may only
be made if the Company's Board of Directors determines that such loan or
guaranty is reasonably expected to benefit the Company. This option shall not be
exercisable as to fewer than ________ shares of Common Stock, or the remaining
shares of Common Stock covered by this option if fewer than _______.
b) This option shall vest and become exercisable after each of
the first three annual anniversary dates of this Agreement as follows:
Year one ________ shares
Year two ________ shares
Year three ________ shares
3. Termination. This option shall expire ________ (the
"Expiration Date") unless earlier terminated in accordance with the provisions
hereof.
4. Early Termination.
a) In the event that the Optionee's employment is
terminated for cause, the option granted hereunder shall lapse to the extent
unexercised immediately upon the giving of the notice of such termination. For
purposes of this paragraph, "for cause" shall mean incompetence, gross
negligence, insubordination, conviction of a felony or willful misconduct by the
Optionee as determined in good faith by the Board of Directors of the Company, a
Committee of the Board of Directors with the authority to make such a
determination or the Board of Directors of the subsidiary of the Company at
which Optionee is employed.
b) In the event of the death of the Optionee, the
Optionee's estate shall have the privilege of exercising the option granted
hereunder not theretofore exercised by the Optionee, to the extent that the
Optionee was entitled to exercise such rights on the date of the Optionee's
death; but in such event, the period of time within which the purchase or
exercise may be made shall be the earlier of (i) 180 days next succeeding the
death of the Optionee or (ii) the Expiration Date.
c) In the event of termination of employment with the
Company or its subsidiaries by the Optionee for any reason other than for cause
or death, the Optionee shall have the right to exercise the option granted
hereunder, to the extent that the Optionee was entitled to exercise such option
on the date of such termination, during the period ending 60 days following such
termination date.
5. Adjustment Provisions.
a) If the Company shall at any time change the number
of issued shares of Common Stock without new consideration of the Company (such
as by stock dividend, stock split, recapitalization, reorganization, exchange of
shares, liquidation, combination or other change in corporate structure
affecting the Common Stock), the number of shares of Common Stock covered by
this option and the purchase price shall be adjusted so that the net value of
this option shall not be changed.
b) In the case of any sale of assets, merger,
consolidation, combination or other corporate reorganization or restructuring of
the Company with or into another corporation which results in the outstanding
common stock being converted into or exchanged for different securities, cash or
other property, or any combination thereof (an "Acquisition"), the Optionee
shall have the right thereafter and during the term of this option, to receive
upon exercise thereof in whole or in part the Acquisition Consideration (as
defined below) receivable upon the Acquisition by a holder of the number of
shares of Common Stock which might have been obtained upon exercise of this
option or portion hereof, as the case may be, immediately prior to the
Acquisition. The term "Acquisition Consideration" shall mean the kind and amount
of securities, cash or other property or any combination thereof receivable in
respect of one share of Common Stock upon consummation of an Acquisition.
6. Assignment or Transfer. This option may not be assigned or
transferred and shall be exercisable only by the Optionee during the Optionee's
lifetime.
7. Agreement to Serve. The Optionee agrees that, during the
course of any employment by the Company, he will devote such time, energy and
skill to the service of the Company as may reasonably be necessary to carry out
his duties as an employee. The Optionee further agrees that during the course of
his service as a director of the Company, he will devote such time, energy and
skill to the service of the Company as may reasonably be necessary to carry out
his obligations as a director. Notwithstanding the foregoing, this option is not
a contract of employment and the terms of any employment of the Optionee shall
not be enlarged or otherwise affected hereby except to the extent specifically
so provided herein.
8. Reserved Shares. The Company has duly reserved for issuance
a number of authorized but unissued shares adequate to fulfill its obligations
under this agreement. During the term of this agreement, the Company shall take
such action as may be necessary to maintain at all times an adequate number of
shares reserved for issuance or treasury shares to fulfill its obligations
hereunder.
9. Legends. The certificates evidencing shares of Common Stock
purchased pursuant to this option shall bear any legends deemed necessary by the
Company.
10. Compliance with Law. This option shall not be exercised,
and no shares of Common Stock shall be issued in respect hereof, unless in
compliance with federal and applicable state securities laws. The Optionee
hereby agrees to execute such documents as the Company may reasonably request to
assure the availability to the Company of an exemption from the registration
requirements of the Securities Act or any state securities or blue sky laws.
11. Representations of the Optionee. As a condition to the
exercise of this option, the Optionee will deliver to the Company such signed
representations, warranties and agreements as may be necessary, in the opinion
of counsel satisfactory to the Company, for compliance with applicable federal
and state securities laws.
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12. Resale. The Optionee's ability to transfer shares of
Common Stock purchased pursuant to this option or securities acquired in lieu
thereof or in exchange therefor may be restricted under federal or state
securities laws. The Optionee shall not resell or offer for resale such shares
of Common Stock or securities unless they have been registered or qualified for
resale under all applicable federal and state securities laws or an exemption
from such registration or qualification is available in the opinion of counsel
satisfactory to the Company.
13. Notice. All notices or other communications desired to be
given hereunder shall be in writing and shall be deemed to have been duly given
upon receipt, if personally delivered, or on the third business day following
mailing by United States first class mail, postage prepaid, and addressed as
follows:
If to the Company:
Xxxxx Brothers, Inc.
0000 Xxxxx Xxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
If to the Optionee:
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or to such other address as either party shall give to the other in the manner
set forth above.
14. Withholding. If the exercise of any rights granted in this
agreement or the disposition of shares following exercise of such rights results
in the Optionee's realization of income which for federal, state or local income
tax purposes is, in the opinion of the Company, subject to withholding of tax,
the Optionee will pay to the Company an amount equal to such withholding tax (or
the Company may withhold such amount from any salary due the Optionee) prior to
delivery of certificates evidencing the shares of Common Stock purchased.
15. Governing Law. This agreement shall be governed and
construed in accordance with the laws of the State of Delaware (regardless of
the law that might otherwise govern under applicable Delaware principles of
conflicts of laws).
16. Miscellaneous. References herein to a date on or as of
which an expiration, termination or lapse shall occur shall be deemed to refer
to 11:59 P.M., Phoenix, Arizona time, on such date.
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IN WITNESS WHEREOF, the Company and the Optionee have executed
this Incentive Stock Option Agreement effective as of the _____ day of
____________, 1997.
THE COMPANY: THE OPTIONEE:
XXXXX BROTHERS, INC. By:
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By:
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Its:
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