Exhibit 10.3
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1992 XXXXXXXX CORPORATION
STOCK INCENTIVE PLAN AGREEMENT
NONQUALIFIED
STOCK OPTION AWARD
You have been selected to be a Participant in the 1992 Xxxxxxxx
Corporation Stock Incentive Plan (the "Plan"), as specified below:
OPTIONEE: Xxxxxxx X. Xxxx
DATE OF GRANT: July 1, 1996
DATE OF EXPIRATION: June 30, 2006
NUMBER OF SHARES COVERED BY THIS AWARD: 58,300
OPTION PRICE: $42.187
THIS DOCUMENT CONSTITUTES PART OF THE PROSPECTUS COVERING SECURITIES THAT HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.
THIS AGREEMENT, effective as of the Date of Grant set forth above, is
between Xxxxxxxx Corporation, an Iowa corporation (the "Company") and the
Optionee named above pursuant to the provisions of the Plan. The parties
hereto agree as follows:
1. Grant of Stock Option. The Company hereby grants to Optionee the
Option to purchase the number of shares of Common Stock of the Company, $1.00
par value ("Common Stock") set forth above at the stated Option Price, which is
100% of the Fair Market Value on the Date of Grant, subject to the terms and
conditions of the Plan and this Agreement.
2. Exercise of Stock Option. As long as the vesting requirements
provided herein are met and the Option has not otherwise terminated or expired,
the Optionee may exercise in whole or in part this Option at any time six
months after the Date of Grant. All Options shall be vested and exercisable on
and after July 1, 2001.
3. Procedure for Exercise of Options. This Option may be exercised by
giving written notice to the Company at its executive offices, addressed to the
attention of its Secretary. Such notice (a) shall be signed by the Optionee,
his legal representative or a permitted transferee under this Agreement; (b)
shall specify the number of full shares then elected to be purchased with
respect to the Option; (c) unless a Registration Statement under the Securities
Act of 1933 is in effect with respect to the shares to be purchased, shall
contain a representation of Optionee that the shares of Common Stock are being
acquired by him or her for investment and with no present intention of selling
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or transferring them, and that he or she will not sell or otherwise transfer
the shares except in compliance with all applicable securities laws and
requirements of any stock exchange upon which the shares of Common Stock may
then be listed; (d) shall be accompanied by payment in full of the Option Price
of the shares to be purchased; and (e) Optionee's copy of this Agreement.
The Option Price upon exercise of this Option shall be payable to the
Company in full either (a) in cash or its equivalent (acceptable cash
equivalents shall be determined at the sole discretion of the Committee); (b)
by tendering previously acquired Shares having an aggregate Fair Market Value
at the time of exercise equal to the total price of the shares for which the
Option is being exercised; (c) by a combination of (a) and (b); (d) by delivery
of a properly executed exercise notice together with irrevocable instructions
to a broker to promptly deliver to the Company the amount of sale proceeds from
the option shares or loan proceeds to pay the exercise price and withholding
taxes due to Company; or (e) such other methods of payment as the Committee at
its discretion deems appropriate.
As promptly as practicable after receipt of such notice and payment, the
Company shall cause to be issued and delivered to the Optionee, his or her
legal representative or permitted transferee under this Agreement, as the case
may be, certificates for the shares so purchased, which may, if appropriate, be
endorsed with appropriate restrictive legends as determined by the Committee.
The Company shall maintain a record of all information pertaining to Optionee's
rights under this Agreement, including the number of shares for which this
Option is exercisable. If the Option shall have been exercised in full, this
Agreement shall be returned to the Company and canceled.
4. Termination of Employment by Death. If, without having fully
exercised this Option, Optionee's employment with the Company is terminated by
reason of death, any outstanding Options granted to Optionee that are not
exercisable at the date of termination shall become fully exercisable, except
for Options granted within six (6) months prior to the date of death, which
Options shall become fully exercisable on the next business day after the sixth
month anniversary of the Date of Grant. Optionee's beneficiary (or such
persons that have acquired Optionee's rights under the Option by will or by the
laws of descent and distribution) shall have the same right to exercise this
Option as Optionee had during his or her lifetime, for a period ending on the
Date of Expiration set forth above.
5. Termination of Employment by Disability. If, without having fully
exercised this Option, Optionee's employment with the Company is terminated by
reason of Disability (as determined pursuant to the September 11, 1991,
Employment Agreement by and between Xxxx and Company, and any successor
employment agreement (the "Employment Agreement")), any outstanding Options
granted to Optionee that are not exercisable at the date of termination shall
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become fully exercisable, except for Options granted within six (6) months
prior to the date of termination, which Options shall become fully exercisable
on the next business day after the sixth month anniversary of the Date of
Grant. Optionee shall have the same right to exercise this Option as Optionee
had during his employment for a period ending on the Date of Expiration set
forth above.
6. Termination of Employment by Retirement. If Optionee's employment
with the Company is terminated by reason of Retirement (as defined under the
then established rules of the Company's tax-qualified retirement plans), any
outstanding options granted to Optionee that are not exercisable at the date of
termination shall be forfeited by Optionee and canceled by the Company. If,
without having fully exercised this Option, Optionee's employment is terminated
by reason of Retirement, Optionee shall have the same right to exercise options
that are exercisable on the date of the termination of employment as Optionee
had during his or her employment for a period ending on the Date of Expiration
set forth above.
7. Termination of Employment Voluntarily by Xxxx or for Due Cause. If,
without having fully exercised this Option, Optionee's employment with the
Company is terminated by Company for "Due Cause" as defined under Section 9.3
of the Employment Agreement or by Optionee as "Employee Voluntary" as defined
under Section 9.5 of the Employment Agreement, any outstanding options granted
to Optionee under this Option that are not exercisable at the date of
termination shall be forfeited by Optionee and canceled by the Company.
Further, Optionee's rights under this Option shall terminate as of the date of
the termination of employment, provided, however, that there shall be an
exercise period for options that are exercisable at the date of employment
termination of up to 30 days after the date of such termination, but such
extension period shall not continue beyond the expiration of the term of this
Option.
8. Termination of Employment for Other Reasons. If, without having fully
exercised this Option, Optionee's employment with the Company is terminated by
Company "At Will" as defined under Section 9.4 of the Employment Agreement, or
by Company for other reasons that are treated under the Employment Agreement in
the same manner as being "At Will," including, without limitation, failure to
renew as discussed under Section 9.8 of the Employment Agreement, or by
Optionee for failure by the Company to elect him to the office of Chairman of
the Company's Board of Directors effective on or about January 1, 1998, or by
Optionee by reason of Optionee not being re-elected to serve as a Director of
the Company or as a member of the Executive Committee of the Company's Board of
Directors, any outstanding Options granted to Optionee that are not exercisable
at the date of termination shall become fully exercisable, except for Options
granted within six (6) months prior to the date of termination, which Options
shall become fully exercisable on the next business day after the sixth month
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anniversary of the Date of Grant. Optionee shall have the same right to
exercise this Option as Optionee had during his employment for a period ending
on the Date of Expiration.
9. Restrictions on Transfer. This Option may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will
or by the laws of descent and distribution. Notwithstanding the foregoing,
Optionee may transfer this Option, in whole or in part, to members of
Optionee's immediate family or trusts or family partnerships for the benefit of
such persons, provided, that no such transfer may be made prior to the
amendment of the Plan to permit such transfers, and provided, further, that
Optionee receive the advance written permission of the Company to make such a
transfer and to further notify the Company upon the completion of the transfer.
Further, this Option shall be exercisable during Optionee's lifetime only by
Optionee, Optionee's legal representative or permitted transferee, as provided
above.
10. Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation, liquidation, stock
dividend, split-up, Share combination, or other change in the corporate
structure of the Company affecting the Shares, such adjustment shall be made in
the number and class of Shares which may be delivered under the Plan, and in
the number and class of and/or price of Shares subject to outstanding Options,
granted under the Plan, as may be determined to be appropriate and equitable by
the Committee in its sole discretion, to prevent dilution or enlargement of
rights; and provided that the number of Shares subject to any
Award shall always be rounded to the nearest whole number. Any adjustment of an
ISO under this paragraph shall be made in such a manner so as not to constitute
a "modification" within the meaning of Section 425(h)(3) of the Code.
11. Rights as a Stockholder. Optionee shall have no rights as a
stockholder of the Company with respect to the shares of Common Stock subject
to this Agreement until such time as the purchase price has been paid and the
shares have been issued and delivered to him or her.
12. Continuation of Employment. This Agreement shall not confer upon
Optionee any right to continuation of employment by the Company, nor shall this
Agreement interfere in any way with the Company's right to terminate his or her
employment at any time.
13. Miscellaneous.
(a) This Agreement and the rights of Optionee hereunder are subject to
all the terms and conditions (including Shareholder approval) of the
Plan, as the same may be amended from time to time, as well as to such
rules and regulations as the Committee may adopt for administration of
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the Plan. The Committee shall have the right to impose such
restrictions on any shares acquired pursuant to the exercise of this
Option, as it may deem advisable, including, without limitation,
restrictions under applicable Federal securities laws, under the
requirements of any stock exchange or market upon which such shares are
then listed and/or traded, and under any blue sky or state securities
laws applicable to such shares.
It is expressly understood that the Committee is authorized to
administer, construe, and make all determinations necessary or
appropriate to the administration of the Plan and this Agreement, all
of which shall be binding upon Optionee. Any inconsistency between
this Agreement and the Plan shall be resolved in favor of the Plan.
All terms used herein shall have the same meaning as in the Plan
document.
(b) With the approval of the Board, the Committee may terminate,
amend, or modify the Plan; provided, however, that no such termination,
amendment, or modification of the Plan may in any way adversely affect
Optionee's rights under this Agreement.
(c) The Company shall have the authority to deduct or withhold, or
require Optionee to remit to the Company, an amount sufficient to
satisfy Federal, state, and local taxes (including Optionee's FICA
obligation) required by law to be withheld with respect to any exercise
of Optionee's rights under this Agreement without Optionee's written
consent.
Optionee may elect, subject to the approval of the Committee, to
satisfy the withholding requirement, in whole or in part, with respect
to a Nonqualified Stock Option, by having the Company withhold shares
of Common Stock having an aggregate Fair Market Value, on the date the
tax is to be determined, equal to the amount required to be withheld.
All elections shall be irrevocable and in writing, and shall be signed
by Optionee in advance of the day that the transaction becomes taxable.
(d) Optionee agrees to take all steps necessary to comply with all
applicable provisions of Federal and state securities law in exercising
Optionee's rights under this Agreement.
(e) The Plan and this Agreement are not intended to qualify for
treatment under the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
(f) This Agreement shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or
national securities exchanges as may be required.
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(g) To the extent not preempted by Federal law, this Agreement shall
be governed by, and construed in accordance with the laws of the State
of Iowa.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the Date of Grant.
XXXXXXXX CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
Its: Vice President-General
Counsel and Secretary
/s/ Xxxxxxx X. Xxxx
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Optionee, Xxxxxxx X. Xxxx
000 Xxxxxx, #0000
Xxx Xxxxxx, XX 00000
Social Security number: ###-##-####
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