PRIMADONNA RESORTS, INC.
CONSULTANT NONQUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT dated as of the ____ day of __________,
_____, between Primadonna Resorts, Inc., a Nevada corporation
(the "Corporation"), and __________________ (the "Consultant")
W I T N E S S E T H
WHEREAS, pursuant to the 1993 Stock Incentive Plan (the
"Plan"), the Corporation has granted to the Consultant effective
as of the ____ day of ________, _____ (the "Award Date"), a
nonqualified stock option to purchase all or any part of ________
authorized but unissued or treasury shares of Common Stock, $.01
par value, of the Corporation upon the terms and conditions set
forth herein and in the Plan.
NOW, THEREFORE, in consideration of the mutual promises and
covenants made herein, the past services (and the expectation of
continuing services, including services on the Corporation's
Board of Directors) of Consultant to the Corporation and the
mutual benefits to be derived herefrom, the parties agree as
follows:
1. Defined Terms. Capitalized terms used herein and not
otherwise defined herein shall have the meaning assigned to such
terms in the Plan.
2. Grant of Option. This Agreement evidences the
Corporation's grant to the Consultant of the right and option to
purchase, on the terms and conditions set forth herein and in the
Plan, all or any part of an aggregate of ________ shares of the
Common Stock at the price of $_____ per share (the "Option"),
exercisable from time to time, subject to the provisions of this
Agreement and the Plan, prior to the close of business on the day
before the tenth anniversary of the Award Date (the "Expiration
Date"). Such price equals the fair market value as of the Award
Date.
3. Exercisability of Option. Except as earlier permitted
by or pursuant to Section 4(c)(ii) of the Plan or by resolution
of the Committee adopted after the date hereof, no shares may be
purchased by exercise of the Option until the expiration of
twelve (12) months after the Award Date. The Option shall become
exercisable in installments as to ______% of the aggregate
number of shares set forth in Section 2 hereof (subject to
adjustment) on and after the first anniversary of the Award
Date and as to an additional ______% of such aggregate number
of shares (subject to adjustment) on each of the _______________
anniversaries of the Award Date.
To the extent the Consultant does not in any year purchase
all or any part of the shares to which the Consultant is
entitled, the Consultant has the right cumulatively thereafter to
purchase any shares not so purchased and such right shall
continue until the Option terminates or expires. Fractional
share interests shall be disregarded, but may be cumulated. No
fewer than 100 shares may be purchased at any one time, unless
the number purchased is the total number at the time available
for purchase under the Option.
4. Method of Exercise of Option. The Option shall be
exercisable by the delivery to the Corporation of a written
notice stating the number of shares to be purchased pursuant to
the Option and accompanied by payment made
(a) in cash or by check payable to the order of the
Corporation;
(b) by exchange of Common Stock of the Corporation,
then having been owned by the Consultant for at least six
(6) months, having a then fair market value (as determined
by the Committee) equal to such purchase price;
(c) to the extent permitted by the Committee, by
promissory note of the Consultant, to be secured by a
security interest in the shares issued upon exercise and
such other collateral, if any, as the Committee may require;
(d) to the extent permitted by the Committee, by
reduction in the number of shares of Common Stock
deliverable upon exercise by that number of shares which
have a then fair market value (as determined by the
Committee) equal to such purchase price; or
(e) in any combination of the consideration permitted
by the foregoing subsections;
subject to such further limitations, rules and procedures as the
Committee may from time to time establish as to any non-cash
payment.
Any promissory note shall bear a rate of interest not less
than a rate, if any, as required under federal tax law to prevent
any imputation of interest, unless such rate exceeds the maximum
rate permissible under Nevada law, in which case the rate shall
not exceed the maximum permitted under Nevada law. All other
terms of such note shall be determined, subject to compliance
with applicable laws (including federal margin requirements if
applicable), solely by the Committee. All terms and conditions,
including whether the note shall become due upon Consultant's
termination of services, shall be expressly set forth in the
promissory note executed by the Consultant. In addition, the
Consultant (or the Consultant's beneficiary or personal
representative) shall furnish any written statements required
pursuant to Section 10(a) of the Plan.
5. Effect of Termination of Services or Death; Change in
Subsidiary Status. The Option and all other rights hereunder, to
the extent not exercised, shall terminate and become null and
void at such time as the Consultant ceases to serve as a member
of the Corporation's Board of Directors, except that
(a) if the Consultant's services terminate by reason
of his permanent and total disability (within the meaning of
Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended (the "Code"), or as otherwise defined by the
Committee), Consultant may at any time within a period of
one (1) year after such termination exercise the Option to
the extent the Option was exercisable at the date of such
cessation;
(b) if the Consultant voluntarily ceases to perform
services with the consent of the Corporation, Consultant may
at any time within a period of three (3) months after such
cessation exercise the Option to the extent the Option was
exercisable at the date of such termination;
(c) if the Consultant dies prior to a termination of
service as a member of the Board of Directors of the
Corporation or within one (1) year after a termination
described in subsection (a) of this Section 5, or within
three (3) months after a cessation described in subsection
(b) of this Section 5, then the Option may be exercised
within a period of one (1) year after Consultant's date of
death by the Consultant's beneficiary to the extent the
Option was exercisable on the date of Consultant's death (or
such earlier cessation);
provided, however, that in no event may the Option be exercised
by anyone under this Section or otherwise after the Expiration
Date.
6. Acceleration of Option Upon Change in Control.
(a) Definitions. For the purpose of Section 6, the
following capitalized terms shall have the meanings set
forth below:
i) "Change in Control" shall mean the date on
which either:
a) the "Xxxx Xxxxx Group" own less than
fifteen percent (15%) of the total voting
power of all classes of the Corporation's
voting stock, except as a result of sales
made in order to pay estate taxes owing as a
result of the death of Xxxx X. Xxxxx;
b) any Person other than the Xxxx Xxxxx
Group or the Primm Family, acting together in
a manner which would constitute a group for
the purposes of Section 13(d) of the
Securities Exchange Act of 1934 as amended (a
"13(d) Group"), shall beneficially own
(within the meaning of Rule 13d-3 promulgated
under the Securities Exchange Act of 1934 as
amended voting power of all classes of the
Corporation's voting stock equal to or
greater than that owned by the Xxxx Xxxxx
Group;
c) a 13(d) Group succeeds in having
sufficient of its directors on the
Corporation's Board of Directors such that
the 13(d) Group's directors will constitute a
majority of the voting power of the
Corporation's Board of Directors; or
d) Xxxx X. Xxxxx shall cease to be the
Corporation's Chairman of the Board of
Directors, except as a result of his death or
disability.
ii) "Xxxx Xxxxx Group" shall mean Xxxx X. Xxxxx,
his executors, administrators, testamentary
trustees, heirs, legatees or beneficiaries.
iii) "Person" shall mean any legal entity,
including but not limited to any individual,
corporation, group or assemblage, partnership,
limited partnership, joint venture, association,
joint stock company, or trust.
iv) "Primm Family" shall mean collective
reference to Xxxxx Xxxxx Xxxx, Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxx Xxxxxxxxxxx, Xxxxx X. Xxxxx
and Xxxxxxx X. Xxxxx, their respective executors,
administrators, testamentary trustees, heirs,
legatees and beneficiaries.
(b) Acceleration of Option. As to the Option, unless
prior to a Change in Control the Committee determines that,
upon its occurrence, there shall be no acceleration of
benefits under this Agreement or determines that only
certain or limited benefits under this Agreement shall be
accelerated and the extent to which they shall be
accelerated and/or establishes a different time in respect
of such event for such acceleration, then upon the
occurrence of a Change in Control (i) the Option granted
under this Agreement shall become immediately exercisable,
(ii) any shares of Common Stock purchased pursuant to the
Option yet subject to payment of consideration, if any, and
such conditions on vesting and such transfer and other
restrictions as are established in or pursuant to the Plan
shall immediately vest free of restrictions, and (iii) any
other rights, including rights to payment, provided for in
this Agreement shall immediately vest or become payable to
the Employee. The Committee may override the limitations on
acceleration in this Section 8 by express provision in this
Agreement and may accord the Employee a right to refuse any
acceleration, whether pursuant to this Agreement or
otherwise, in such circumstances as the Committee may
approve. Any acceleration of the Option shall comply with
applicable regulatory requirements, including without
limitation Section 422 of the Code.
7. Termination of Option Under Certain Events. The Option
to the extent not previously exercised shall terminate upon an
event or transaction which the Corporation does not survive
PROVIDED THAT (1) THE CORPORATION OR A SUCCESSOR SHALL HAVE GIVEN
TO CONSULTANT AT LEAST TEN (10) DAYS NOTICE OF ANY SUCH
TERMINATION, AND CONSULTANT SHALL HAVE HAD THE RIGHT PRIOR TO OR
SIMULTANEOUSLY WITH THE CONSUMMATION OF THE EVENT OR OTHER
TRANSACTION TO EXERCISE HIS OPTION AS TO ALL OR ANY PART OF THE
COMMON STOCK SUBJECT TO THIS AGREEMENT, OR (2) THE COMMITTEE
SHALL HAVE PROVIDED FOR AN ADJUSTMENT PURSUANT TO THE PROVISIONS
OF SECTION 7 OF THE PLAN OF THE SECURITIES OR OTHER PROPERTY
DELIVERABLE UPON EXERCISE OF THE OPTION.
8. Non-Transferability of Option. During the Consultant's
lifetime, this Option and any other rights hereunder may be
exercised only by the Consultant or the Consultant's duly
appointed guardian or legal representative. This Option and such
rights shall not be sold, transferred, assigned, pledged,
hypothecated or otherwise disposed of in any way (whether by
operation of law or otherwise); provided, however, that nothing
in this Section 7 shall prevent transfers by will or by the
applicable laws of descent and distribution or, effective
September 1, 1993 (or such later date as may be established by
the Committee) pursuant to a "qualified domestic relations
order") as defined by the Code.
9. Notices. Any notice to be given under the terms of this
Agreement shall be in writing and addressed to the Corporation at
its principal office, to the attention of the Corporate Secretary
and to the Consultant at the address given beneath the
Consultant's signature hereto, or at such other address as either
party may hereafter designate in writing to the other.
10. Consultant not a Shareholder. Neither the Consultant
nor any other person entitled to exercise the Option shall have
any of the rights or privileges of a shareholder of the
Corporation as to any shares of Common Stock not actually issued
and delivered to him prior to delivery of the exercise price and
satisfaction of all other conditions precedent to the due
exercise of the Option and delivery of shares.
11. Effect of Award Agreement. This Agreement shall be
binding upon and inure to the benefit of any successor or
successors of the Corporation except to the extent the Committee
determines otherwise.
12. Laws Applicable to Construction. The Option has been
granted as of the Award Date, and the interpretation, performance
and enforcement of the Option and this Agreement shall be
governed by the laws of the State of Nevada.
13. Plan. The Option and all rights of Consultant
thereunder are subject to, and the Consultant agrees to be bound
by, all of the terms and conditions of the provisions of the
Plan, incorporated herein by this reference. The Consultant
acknowledges receipt of a copy of the Plan and agrees to be bound
by the terms thereof. Unless otherwise expressly provided in
other Sections of this Agreement, provisions of the Plan that
confer discretionary authority on the Committee do not (and shall
not be deemed to) create any rights in the Consultant unless such
rights are expressly set forth herein or are otherwise in the
sole discretion of the Committee so conferred by appropriate
action of the Committee under the Plan after the date hereof.
IN WITNESS WHEREOF, the Corporation has caused this
Agreement to be executed on its behalf by a duly authorized
officer and the Consultant has hereunto set his hand.
PRIMADONNA RESORTS, INC.
(a Nevada corporation)
By __________________________
Xxxx X. Xxxxx
President
Chairman of the Board
Chief Executive Officer
CONSULTANT
Name
_______________________________
(Signature)
_______________________________
(Address)
_______________________________
(CITY, STATE, ZIP CODE)