EXHIBIT 10.2
STOCK OPTION AGREEMENT
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THIS STOCK OPTION AGREEMENT is made as of the _____ day of _____, 199_,
between Caribiner International, Inc., a Delaware corporation (hereinafter
called the "Corporation"), and __________________, an employee of the
Corporation or one of its subsidiaries (hereinafter called the "Participant").
WHEREAS, the Corporation desires to give the Participant an opportunity
to participate in the long-term growth of the Corporation by granting to the
Participant options to purchase the Corporation's common stock, par value $0.01
per share (the "Common Stock"), pursuant to the terms and conditions of the
Corporation's 1996 Stock Option Plan (the "Plan") and this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth and for other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties agree as follows:
1. Grant of Option. The Corporation hereby grants to the Participant the
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right and option (hereinafter called the "Option") to purchase an aggregate of
____________ shares (the "Shares") of Common Stock (such number being subject to
adjustment as provided in paragraph 7 hereof) on the terms and subject to the
conditions herein set forth. Such Option shall vest as follows: (i) thirty-three
and one-third percent (33-1/3%) of the Option herein granted (for up to ______
shares) shall vest and may be exercised at any time on or after the first
anniversary of this Agreement (unless terminated earlier pursuant to paragraph 6
hereof), (ii) thirty-three and one-third percent (33-1/3%) of the Option herein
granted (for up to ______ shares) shall vest and may be exercised on or after
the second anniversary of this Agreement (unless terminated earlier pursuant to
paragraph 6 hereof) and (iii) the remaining thirty-three and one-third percent
(33-1/3%) of the Option herein granted (for up to ______ shares) shall vest and
may be exercised on or after the third anniversary of this Agreement (unless
terminated earlier pursuant to paragraph 6 hereof). The Option granted hereby is
not intended to be an "incentive stock option" within the meaning of Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"), and the Agreement
shall be construed and interpreted in accordance with such intention.
2. Exercise Price. The exercise price of the Shares covered by the
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Option shall be __________ Dollars and __________ Cents ($__.___) per Share.
3. Term of Option. Subject to paragraph 8 hereof, the Option granted
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hereby shall be exercisable in accordance with paragraph 1. The Participant's
right to exercise the aforementioned Option shall expire ten (10) years from the
date hereof (the "Expiration Date"). Unless terminated earlier pursuant to
paragraph 6 hereof, the Option may not be exercised after the Expiration Date.
4. Nontransferability. The Option granted hereby shall not be
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transferable otherwise than by will or the laws of descent and distribution.
More particularly (except as provided in the preceding sentence), the Option may
not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed
of in any way, shall not be assignable by operation of law, and shall not be
subject to execution, attachment or similar process. Any attempted sale,
assignment, transfer, pledge, hypothecation or other disposition of the Option
contrary to the provisions hereof, and the levy of any execution, attachment or
similar process upon the Option, shall be null and void and without effect. The
Option may be exercised by the Participant only during his lifetime or following
his death pursuant to paragraph 6 hereof.
5. Disclosure and Risk.
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(a) The Participant represents and warrants to the Corporation as
follows:
(i) The Participant acknowledges that (A) neither the Option nor
the Shares have been registered for resale under the Securities Act of 1933, as
amended (the "Securities Act"), and (B) the Corporation is under no obligation
to effect the registration under the Securities Act of the Option and/or the
Shares.
(ii) The Shares will be acquired by the Participant for the
Participant's own account, for investment and not with a view to, or for resale
in connection with, any distribution or public offering thereof within the
meaning of the Securities Act.
(iii) The Corporation has made available to the Participant the
opportunity to ask questions of the officers and management of the Corporation
and to acquire information about the business and financial condition of the
Corporation and has, and at the time of exercise of the Option will have, all
information necessary for him to make an informed investment decision.
(iv) He has received a copy of the Plan.
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(b) Each certificate representing the Shares will be endorsed with
the following or a substantially similar legend:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF
UNLESS (i) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT COVERING SUCH SECURITIES, OR (ii) THE CORPORATION
RECEIVES A WRITTEN OPINION FROM COUNSEL FOR THE HOLDER OF THESE
SECURITIES, REASONABLY SATISFACTORY TO THE CORPORATION, STATING THAT
SUCH SALE, TRANSFER, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER
DISPOSITION MAY BE MADE PURSUANT TO RULE 144 PROMULGATED UNDER THE
SECURITIES ACT OR IS OTHERWISE EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES LAWS."
The Corporation need not allow a transfer of any of the Shares unless
one of the conditions specified in the foregoing legend is satisfied. The
Corporation may also instruct its transfer agent not to allow the transfer of
any of the Shares unless one of the conditions specified in the foregoing legend
is satisfied.
Any legend endorsed on a certificate pursuant to the foregoing
language and the stop transfer instructions with respect to such Shares shall be
removed, and the Corporation shall promptly issue a certificate without such
legend to the holder thereof if (i) the Shares are registered under the
Securities Act and a prospectus meeting the requirements of Section 10 of the
Securities Act is available and has been delivered or (ii) the holder provides
the Corporation with a written opinion from counsel for such holder of the
Shares, reasonably satisfactory to the Corporation, to the effect that a sale,
transfer, assignment, pledge, hypothecation or other disposition of such Shares
may be made without registration.
6. Termination of Employment; Disability; Retirement; Death.
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(a) In the event that the Participant shall cease to be an employee
of the Corporation for any reason other than death, Disability, Retirement or
Cause (each as defined below), the Option may be exercised by the Participant
(to the extent that the Participant shall have been entitled to do so as of the
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date of the termination of his employment with the Corporation) at any time
prior to the expiration date of the Option or within 30 days after such
termination, whichever is earlier. So long as the Participant shall continue to
be an employee of the Corporation, the Option shall not be affected by any
change of duties or position.
(b) In the event of the Disability or Retirement of the Participant,
the unexercised portion of the Option that is held by the Participant on the
date of such Disability or Retirement, whether or not otherwise exercisable on
such date, shall be exercisable one (1) year from the date of Disability or
Retirement. "Disability" shall mean any termination of employment with the
Corporation or a subsidiary because of a long-term or total disability, as
determined by the Compensation Committee (the "Committee") of the Board of
Directors (the "Board") of the Corporation in its sole discretion. "Retirement"
shall mean a termination of employment with the Corporation or a subsidiary
either (I) on a voluntary basis by a recipient who is at least 65 years of age
or (ii) otherwise with the written consent of the Committee in its sole
discretion.
(c) During the lifetime of the Participant, the Option shall be
exercisable only by him (or by his legal guardian or representative). In the
event of the death of the Participant while he is an employee of the Corporation
or any subsidiary, the Option (or unexercised portion thereof) which is held by
the Participant at the date of death, whether or not exercisable on the date of
death, shall be exercisable in accordance with the terms of this Agreement by
the beneficiary designated by the Participant for such purpose (the "Designated
Beneficiary") or if no Designated Beneficiary shall have been appointed or if
the Designated Beneficiary shall predecease the Participant, by the
Participant's personal representatives, heirs or legatees at any time for a
period of one (1) year after the date of the Participant's death and any portion
of the Option which is not exercised during such one (1) year period shall be
forfeited.
In the event of the death of the Participant following a termination
of employment due to Retirement or Disability, if such death occurs before the
Option (or any portion thereof) is exercised, the Option (or portion thereof)
that is held by the Participant on the date of termination of employment,
whether or not exercisable on such date, shall be exercisable by such
Participant's Designated Beneficiary or if no Designated Beneficiary shall have
been appointed or if the Designated Beneficiary shall predecease the
Participant, by the Participant's personal representatives, heirs or legatees at
any time for a period of one (1) year after the date of the Participant's death
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and any portion of the Option which is not exercised during such one (1) year
period shall be forfeited.
(d) In the event a Participant is terminated for Cause, the Committee
may, in its sole discretion, cause the unexercised portion of the Option that is
held by the Participant on the date of termination to be forfeited. "Cause"
shall mean (i) the Participant's conviction or plea of guilty or nolo contendre
to the commission of a felony, (ii) the Participant's commission of any fraud,
misappropriation or misconduct which causes demonstrable injury to the
Corporation or a subsidiary; (iii) an act of dishonesty by the Participant
resulting or intended to result, directly or indirectly, in gain or personal
enrichment at the expense of the Corporation or a subsidiary, (iv) any breach of
the Participant's fiduciary duties to the Corporation as an employee or officer
or (v) any other serious violation of Corporation policy. The Committee will
have the sole discretion to determine whether the Participant's termination was
for Cause.
7. Changes in Capital Structure. If all or any portion of the Option
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shall be exercised subsequent to any stock dividend, stock split,
recapitalization, merger, consolidation, combination or exchange of shares,
separation, spin-off, reorganization, liquidation or the like occurring after
the date hereof, as a result of which shares of any class shall be issued in
respect of outstanding Common Stock or shares of Common Stock shall be changed
into the same or a different number of shares of the same or another class or
classes, the person or persons exercising the Option shall receive, for the
aggregate price paid upon such exercise, the aggregate number and class of
shares which, if the Shares (as authorized at the date hereof) had been
purchased at the date hereof for the same aggregate price (on the basis of the
price per share set forth in paragraph 2 hereof) and had not been disposed of,
such person or persons would be holding at the time of such exercise as a result
of such purchase and all such share dividends, stock splits, recapitalizations,
mergers, consolidations, combinations or exchanges of shares, separations, spin-
offs, reorganizations, liquidations or the like; provided, however, that no
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fractional shares shall be issued upon any such exercise, and the aggregate
price paid shall be appropriately reduced on account of any fractional share not
issued. In no event shall any adjustments be made to the Option as a result of
the issuance or redemption of securities of the Corporation for cash or other
consideration, or upon the exercise of any conversion rights of any securities
of the Corporation.
8. Method of Exercising Option. Subject to the terms and conditions of
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this Agreement, the Option may be exercised in whole or in part by giving
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written notice to the Secretary of the Corporation, at the address set forth
below the Corporation's signature to this Agreement or such other location as
may be designated by the Secretary of the Corporation. Such notice shall state
the Participant's election to exercise the Option and the number of Shares in
respect of which it is being exercised, and shall be signed by the person or
persons so exercising the Option. Payment for the Shares may be made (i) in
cash or (ii) at the option of the Committee, or, in absence of the Committee,
the Board, by delivery of Common Stock already owned by the Participant and
having an aggregate Market Price (as defined in the Plan) on the date of such
delivery equal to the aggregate exercise price of the shares so purchased or
(iii) at the option of the Committee, or, in absence of the Committee, the
Board, by delivery of a combination of cash and Common Stock having an aggregate
Market Price on the date of such delivery equal to the aggregate exercise price
of the shares so purchased. The Corporation shall deliver a certificate or
certificates representing the shares of Common Stock so purchased as soon as
practicable after the notice of election has been received. In the event the
Option shall be exercised by any person or persons other than the Participant,
the notice of election shall be accompanied by appropriate proof of the right of
such person or persons to exercise the Option. All shares of Common Stock that
shall be purchased upon the exercise of the Option as provided herein shall be
fully paid and nonassessable.
9. Change of Control.
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(a) As long as Participant is an employee of the Corporation, a
"Change of Control" of the Corporation shall cause the Option (or the
unexercised portion thereof), whether or not currently exercisable, to become
immediately exercisable, in whole or in part, as of the effective date of such
Change of Control without regard to any vesting provisions or condition
precedent which may be contained in paragraph 1 of this Agreement. For purposes
of this paragraph, a "Change of Control" shall be deemed to have occurred if (i)
any person or "group" (other than Warburg, Xxxxxx Investors, L.P. or any
affiliate thereof) acquires, in a single transaction or series of related
transactions, 50% or more of the outstanding Common Stock; (ii) during any
period of two consecutive years, individuals that at the beginning of such
period constitute the Board cease for any reason to constitute a majority
thereof, unless the election, or the nomination for election by the
stockholders, of each such new director was approved by a vote of at least two-
thirds of the directors then still in office which were directors at the
beginning of the period; or (iii) the sale of all or substantially all of the
assets of the Corporation (other than to a wholly-owned subsidiary of the
Corporation).
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(b) Notwithstanding the provisions of paragraph 9(a), in the case
that the Corporation is merged or consolidated with another corporation, or the
assets or stock of the Corporation is acquired by another corporation, or a
separation, reorganization or liquidation of the Corporation occurs, the Board,
or the Board of Directors of any corporation assuming the obligations of the
Corporation hereunder, shall make appropriate provisions for the protection of
the Option by substitution on an equitable basis of appropriate stock of the
Corporation, or appropriate stock of the merged, consolidated or otherwise
reorganized corporation, provided that only the excess of the aggregate Market
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Price of the shares subject to the Option immediately after such substitution
over the aggregate exercise price thereof is not less than the excess of the
aggregate Market Price of the shares subject to the Option immediately before
such substitution over the aggregate exercise price thereof.
10. Optionee Not a Stockholder. The Participant shall not have any rights
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as a stockholder with respect to any shares of Common Stock subject to the
Option prior to the date on which he is recorded as the holder of such shares on
the records of the Corporation.
11. Taxes. The Corporation may make such provisions and take such steps
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as it may deem necessary or appropriate for the withholding of all federal,
state, local and other taxes required by law to be withheld with respect to the
Option including, but not limited to (i) reducing the number of shares of Common
Stock otherwise deliverable, based upon their fair market value on the date of
exercise, to permit deduction of the amount of any such withholding taxes from
the amount otherwise payable under this Agreement; (ii) deducting the amount of
any such withholding taxes from any other amount then or thereafter payable to
the Participant; or (iii) requiring the Participant, Designated Beneficiary or
legal representative to pay to the Corporation the amount required or desirable
to enable it to satisfy its withholding obligations as a condition of releasing
the Common Stock.
12. General Provisions.
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(a) The Corporation shall at all times during the term of the Option
reserve and keep available such number of Shares as will be sufficient to
satisfy the requirements of this Option Agreement, shall pay all fees and
expenses necessarily incurred by the Corporation in connection therewith, and
shall use its best efforts to comply with all laws and regulations which, in the
reasonable opinion of counsel to the Corporation, are applicable thereto.
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(b) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York without regard to principles of conflicts
of laws.
(c) Any notice to be given hereunder by either party to the other
shall be in writing and shall be given either by personal delivery, facsimile or
by mail, registered or certified, postage prepaid, return receipt requested, or
by overnight delivery addressed to the other party at the respective addresses
or facsimile numbers set forth below their signatures to this Agreement, or at
any other address or facsimile number as such party may hereafter specify in
writing.
(d) This Agreement is irrevocable and is intended to conform in all
respects with the Plan. Inconsistencies between this Agreement and the Plan
shall be resolved according to the terms of the Plan. No amendments or
modifications to this Agreement shall be binding unless made in writing and
signed by the parties hereto.
(e) The waiver by either party of a breach of any term or provision
of this Agreement shall not operate or be construed as a waiver of a subsequent
breach of the same provision or of the breach of any other term or provision of
this Agreement.
(f) As used herein, the masculine gender shall include the feminine
and the neuter genders, the neuter shall include the masculine and the feminine
genders, the singular shall include the plural, and the plural shall include the
singular.
(g) The headings in this Agreement are solely for convenience of
reference and shall be given no effect in the construction or interpretation of
this Agreement.
(h) The invalidity or enforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.
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(i) NEITHER THE PLAN NOR THIS AGREEMENT SHALL BE (1) CONSTRUED AS
GIVING THE PARTICIPANT THE RIGHT TO BE RETAINED IN THE EMPLOY OF THE CORPORATION
OR ANY SUBSIDIARY THEREOF OR TO BE ENTITLED TO ANY REMUNERATION OR BENEFITS NOT
SET FORTH IN THE PLAN OR THIS AGREEMENT OR (2) INTERFERE WITH OR LIMIT THE RIGHT
OF THE CORPORATION OR ANY SUBSIDIARY THEREOF TO MODIFY THE TERMS OF OR TERMINATE
THE PARTICIPANT'S EMPLOYMENT AT ANY TIME WITH OR WITHOUT CAUSE.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
PARTICIPANT
______________________________
Name:
Address:
Facsimile:
CARIBINER INTERNATIONAL, INC.
By:___________________________
Name:
Title:
Address: 00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
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