Exhibit 10(xxxi)
AMERICAN GREETINGS CORPORATION
STOCK OPTION AGREEMENT
1997 EQUITY AND PERFORMANCE INCENTIVE PLAN
Cleveland, Ohio
WHEREAS, the individual identified on the attached form, (the
"Optionee") is a director of American Greetings Corporation (the "Company"); and
WHEREAS, the Company is authorized under the attached 1997 Equity
and Performance Incentive Plan ("Plan") to grant stock options to directors
including the Optionee;
NOW, THEREFORE, in consideration of their mutual promises herein,
the Company and the Optionee agree as follows:
Subject to the terms and conditions set forth in the Plan:
(1) The Company hereby grants to the Optionee options ("Options") to
purchase the Class of Common Shares, par value $1 per share ("Shares"), of the
Company in the amount and at the price indicated on the attached form, the
option price being the market price of the Company's Class A Common Shares
quoted by the New York Stock Exchange ("NYSE") on the day on which these Options
are granted, and agrees to cause certificates for any Shares purchased hereunder
(or other evidence of share ownership selected by the Company) to be delivered
to the Optionee upon receipt of the purchase price either (i) in cash or check;
(ii) in whole or in part, Class A and/or Class B Common Shares of the Company
valued (in the case of both Class A and/or Class B Common Shares) at the time of
exercise at least equal to the option price; (iii) by surrender of any other
award or grant under the Plan valued at the time of exercise at least equal to
the option price; or (iv) a combination of such payment methods.
(2) The Options shall become exercisable, from time to time, in whole or in
part, according to the attached schedule, as long as the Optionee remains a
director of the Company. Once the Options have become exercisable, all or any
part of the Options shall be exercisable during the balance of the option
period; provided, however, if the Optionee shall die, become permanently
disabled or incompetent, or has ten (10) or more years of continuous service
with the Company and shall terminate as a director at age 65 (and on such other
grounds as the Compensation Committee of the Board may hereafter determine in
its sole discretion), all Options represented by this Stock Option Agreement
that have not vested shall become immediately exercisable in full.
(3) The Options shall terminate on the earliest of the following dates:
(a) Ten years from the date on which they were granted; or
(b) One year from the date of death or permanent disability or
incompetence of the Optionee if the same was the cause of, or
occurred within three months after, termination of the Optionee's
service as a director of the Company; or
(c) Six months and one day from the date of termination of service as
a director in all other cases.
In the event the Compensation Committee determines that the Optionee has
intentionally committed an act materially inimical to the interests of the
Company, this Stock Option Agreement shall terminate at the date of such act,
notwithstanding any other provision hereof. Nothing in this Section (3) shall be
construed to modify or enlarge the rights of the Optionee as set forth in
Section (2) hereof. Nothing contained in this Stock Option Agreement shall limit
whatever right the Company might otherwise have to terminate the service of the
Optionee and the terms hereof shall not be affected in any manner by any
agreement between the Optionee and the Company.
(4) Persons receiving Options by will or by the laws of descent and
distribution may exercise the Options upon the terms provided for in the Plan
and this Stock Option Agreement.
(5) The Options shall not be exercisable if at the time of exercise such
exercise would require registration of the Class A or Class B Common Shares or
other securities to be purchased hereunder under the Securities Act of 1933, as
amended, or under any similar federal securities law then in effect and such
registration shall not then be effective. The Company shall register the Class A
or Class B Common Shares or other securities covered by this Stock Option
Agreement under any such law if such registration shall be necessary to the
exercise of the Options and the Compensation Committee in its sole discretion
determines that such registration would not result in undue expense or hardship
to the Company and that such registration is desirable to effect the purposes
for which the Options are granted.
(6) The Options may be exercised by the Optionee by (a) delivering to the
Company (Attention of the Director - Retirement & Payroll or successor to such
job title) written notice of the number and class of Shares with respect to
which the Options are being exercised, and (b) in those cases where the Optionee
does not intend to immediately sell the Shares covered by the Options, paying
the purchase price of the Shares being acquired plus any required withholdings.
The Optionee shall have no rights as a shareholder with respect to any Shares
covered by the Options evidenced by this Stock Option Agreement until such time
that the Option is exercised and the Optionee pays the full purchase price for
the underlying Shares. In those cases where the Optionee intends to immediately
sell Shares covered by the Options, after notifying the Company of his or her
intention to sell, the Optionee will receive the amount by which the sale price
exceeds the xxxxx xxxxx for such Shares, after deducting applicable taxes and
brokerage fees, but not interest that might otherwise be paid on an advance of
moneys to the Optionee between the exercise and settlement dates. The sale price
for both Class A and Class B Common Shares shall be the price of Class A Common
Shares as quoted by NYSE as of the close of business on the date of exercise.
(7) Upon the exercise of Options or Reload Options (as defined below)
through the delivery of any class of the Company's Common Shares or other grants
or awards under paragraph 4.(d) of the Plan held by an Optionee for at least six
months, an Optionee who is an active director of the Company shall receive
replacement Options equal in number to the number of Common Shares and/or other
grants or awards surrendered in order to exercise the Options and on the same
terms as the Options or Reload Options surrendered, except that Reload Options
shall not be exercisable more than ten (10) years from the date of grant of the
initial Options ("Reload Options"). The Reload Options themselves may not be
reloaded, and may not be exercised after the date on which the Options in
respect of which such Reload Options were granted, expire, are canceled or
terminate.
(8) If any provision of this Stock Option Agreement conflicts with any
provision in the 1997 Equity and Performance Incentive Plan, the provisions of
the 1997 Equity and Performance Incentive Plan shall govern.
AMERICAN GREETINGS CORPORATION
[Non-Employee Director Form]
