EXHIBIT 10.2
NONQUALIFIED STOCK OPTION AGREEMENT
This Nonqualified Stock Option Agreement ("Option Agree ment") is between
Xxxxxx Corporation, a Delaware corporation (the "Company") and _________________
(the "Optionee").
W I T N E S S E T H:
___________________
WHEREAS, to carry out the purposes of the Xxxxxx Corporation 1997
Nonqualified Stock Option Plan (the "Plan") by providing for the acquisition of
proprietary interests in the Company through the award of a nonqualified stock
option providing for acquisition rights in the common stock of the Company, to
retain and attract personnel of outstanding ability, and to provide additional
motivation to the Employee to continue to exert Employee's best efforts for the
success and welfare of the Company and the benefit of the Company's
stockholders, the Committee (as defined in the Plan) has determined that the
Company's interests will be advanced by the issuance to Optionee of a
nonqualified stock option under the Plan.
NOW THEREFORE, for and in consideration of these premises it is agreed as
follows:
1. Option. Subject to the terms and conditions contained herein, the
Company hereby irrevocably grants to Optionee the right and option ("Option") to
purchase from the Company _____________________ (_________) shares of the
Company's common stock, $1.00 par value ("Common Stock"), at a price of
$__________ per share.
2. Option Period. The Option herein granted may be exercised by Optionee
in whole or in part at any time during a ten (10) year period (the "Option
Period") beginning on ________________, 1997 (the "Grant Date"), subject to
the limitation that said Option shall not be exercisable for more than a
percentage of the aggregate number of shares offered by this Option determined
by the number of full years of employment with the Company or its Affiliates
beginning on the Grant Date in accordance with the following schedule:
Number of Percentage of
Full Years Shares Purchasable
__________ __________________
Less than one 0%
One 25%
Two 50%
Three 75%
Four or more 100%
Notwithstanding anything in this Agreement to the contrary, the Committee, in
its sole discretion may waive the foregoing schedule of vesting and upon written
notice to the Optionee, accelerate the earliest date or dates on which any of
the Options granted hereunder are exercisable.
3. Procedure for Exercise. The Option herein granted may be exercised by
written notice by Optionee to the Secretary of the Company setting forth the
number of shares of Common Stock with respect to which the Option is to be
exercised accompanied by payment for the shares to be purchased, and specifying
the address to which the certificate for such shares is to be mailed. The
notice shall be accompanied by (i) cash, cashier's check, bank draft, postal or
express money order payable to the order of the Company, or other immediately
available funds, or (ii) at the election of the Optionee and agreed to by the
Committee, certificates representing shares of Common Stock theretofore owned by
Optionee duly endorsed for transfer to the Company, or (iii) any combination of
the preceding, equal in value to the aggregate exercise price. Notice may also
be delivered by fax or telecopy provided that the exercise price of such shares
is received by the Company via wire transfer on the same day the fax or telecopy
transmission is received by the Company. An option to purchase shares of Common
Stock in accordance with this Plan, shall be deemed to have been exercised
immediately prior to the close of business on the date (i) written notice of
such exercise and (ii) payment in full of the exercise price for the number of
shares for which Options are being exercised, are both received by the Company
and Optionee shall be treated for all purposes as the record holder of such
shares of Common Stock as of such date.
As promptly as practicable after receipt of such written notice and
payment, the Company shall deliver to Optionee certificates for the number of
shares with respect to which such Option has been so exercised, issued in
Optionee's name or such other name as Optionee directs; provided, however, that
such delivery shall be deemed effected for all purposes when a stock transfer
agent of the Company shall have deposited such certificates in the United States
mail, addressed to Optionee at the address specified pursuant to this Section 3.
4. Termination of Employment or Cessation from the Board of Directors.
If Optionee's employment with the Company or its Affiliates is terminated during
the Option Period for any reason or if the Optionee ceases to serve on the Board
of the Company or its Affiliates during the Option Period for any reason,
Options which are exercisable by the Optionee pursuant to Section 2 on the date
of such termination of employment or cessation from the Board of the Company
shall expire on the earlier of (i) six months from the date of the Optionee's
termination of employment or cessation from the Board of the Company or (ii) the
remaining Option Period established for the Option pursuant to Section 2. Any
Options which are not exercisable by the Optionee pursuant to Section 2 on the
date of the Optionee's termination of employment or cessation from the Board of
the Company shall expire on the date of such termination of employment or
cessation from the Board of the Company.
5. Transferability. This Option shall not be transferable by Optionee
otherwise than by Optionee's will or by the laws of descent and distribution.
During the lifetime of Optionee, the Option shall be exercisable only by him.
Any heir or legatee of Optionee shall take rights herein granted subject to the
terms and conditions hereof. No such transfer of this Option Agreement to heirs
or legatees of Optionee shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and a copy of such
evidence as the Committee may deem necessary to establish the validity of the
transfer and the acceptance by the transferee or transferees of the terms and
conditions hereof.
6. No Rights as Stockholder. Optionee shall have no rights as a
stockholder with respect to any shares of Common Stock covered by this Option
Agreement until the Option is exercised by written notice and accompanied by
payment as provided in Section 3 above. Until such time, Optionee shall not be
entitled to dividends attributable to such shares or to vote such shares at
meetings of the stock holders of the Company. Except as provided in Section 8
hereof, no adjustment shall be made for dividends (ordinary or extraordinary,
whether in cash or securities or other property) paid or distributions or
other rights granted in respect of any share of Common Stock for which the
record date for such payment, distribution or grant is prior to the date upon
which the Optionee shall have exercised said Option by written notice and
payment to the Company, as provided hereinabove.
7. Corporate Transactions.
a. If the Company is reorganized, merged or consolidated or is
otherwise a party to a plan of exchange with another corporation pursuant to
which reorganization, merger, consolidation or plan of exchange, shareholders of
the Company receive any shares of Common Stock or other securities or if the
Company shall distribute ("Spin Off") securities of another corporation to its
shareholders, there shall be substituted for the shares subject to the
unexercised portion of the Option an appropriate number of shares of (i) each
class of stock or other securities which were distributed to the shareholders of
the Company in respect of such shares in the case of a reorganization, merger,
consolidation or plan of exchange, or (ii) in the case of a Spin Off, the
securities distributed to shareholders of the Company together with shares of
Common Stock, such number of shares or securities to be determined in accordance
with the provisions of Section 425 of the Code (or other applicable provisions
of the Code or regulations issued thereunder which may from time to time govern
the treatment of incentive stock options in such a transaction); provided,
however, that the Option may be canceled by the Company as of the effective date
of (x) a reorganization, merger, consolidation, plan of exchange or Spin Off or
(y) any dissolution or liquidation of the Company, by giving notice to the
Optionee or his personal representative of its intention to do so and by
permitting the purchase for a period of at least thirty days during the sixty
days next preceding such effective date of all of the shares subject to the
Option; and provided further that in the event of a Spin Off, the Company may,
in lieu of substituting securities or accelerating and canceling the Option as
contemplated above, elect (i) to reduce the purchase price for each share of
Common Stock subject to the Option by an amount equal to the fair market value,
as determined in accordance with the provisions of Section 6(b), of the
securities distributed in respect of each outstanding share of Common Stock in
the Spin Off or (ii) to reduce proportionately the purchase price per share and
to increase proportionately the number of shares of Common Stock subject to the
Option in order to reflect the economic benefits inuring to the shareholders of
the Company as a result of the Spin Off.
b. The Option shall become fully exercisable upon a Change in Control
of the Company (as defined in the next sentence). "Change in Control" of the
Company shall be conclusively deemed to have occurred if (and only if) any of
the following shall have taken place: (i) a change in control is reported by
the Company in response to either Item 5(f) of Schedule 14A of Regulation 14A
promulgated under the Exchange Act; (ii) any "person" (as such term is used in
Sections 13(d) and 14(d)(2) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing forty percent or more of
the combined voting power of the Company's then outstanding securities; or (iii)
following the election or removal of directors, a majority of the Board consists
of individuals who were not members of the Board two years before such election
or removal, unless the election of each director who was not a director at the
beginning of such two year period has been approved in advance by directors
representing at least a majority of the directors then in office who were
directors at the beginning of the two-year period.
c. Except as hereinbefore expressly provided, the issue by the
Company of shares of stock of any class, or securities convertible into or
exchangeable for shares of stock of any class, for cash or property, or for
labor or services, either upon direct sale or upon the exercise of rights or
warrants to subscribe therefore, or upon conversion of shares or obligations of
the Company convertible into or exchangeable for shares of stock of any class
shall not affect, and no adjustment by reason thereof shall be made with respect
to, the number of shares of Common Stock subject to the Option granted
hereunder.
8. Changes in Capital Structure. The existence of outstanding Options
shall not affect in any way the right or power of the Company or its
shareholders to make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure or its
business, or any merger or consolidation of the Company, or any issuance of
Common Stock or subscription rights thereto, or any issuance of bonds,
debentures, preferred or prior preference stock ahead of or affecting the Common
Stock or the rights thereof, or the dissolution or liquidation of the Company,
or any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceedings, whether of a similar character or otherwise.
If the outstanding shares of Common Stock of the Company shall at any time be
changed or exchanged by a subdivision or consolidation of shares of Common Stock
or other capital readjustment, a declaration of a stock dividend, stock split,
combination of shares, or recapitalization, the number and kind of shares
subject to the Plan or subject to any Options theretofore granted, and the
Option prices, shall be appropriately and equitably adjusted so as to maintain
the proportionate number of shares without changing the aggregate Option price.
9. Compliance With Securities Laws. Upon the acquisition of any shares
pursuant to the exercise of the Option herein granted, Optionee (or any person
acting under Section 5) will enter into such written representations,
warranties and agreements as the Company may reasonably request in order to
comply with applicable securities laws or with this Option Agreement.
10. Compliance With Laws. Notwithstanding any of the other provisions
hereof, Optionee agrees that he will not exercise the Option(s) granted hereby,
and that the Company will not be obligated to issue any shares pursuant to this
Option Agreement, if the exercise of the Option(s) or the issuance of such
shares of Common Stock would constitute a violation by the Optionee or by the
Company of any provision of any law or regulation of any governmental authority.
11. Withholding of Tax. To the extent that the exercise of this Option or
the disposition of shares of Common Stock acquired by exercise of this Option
results in compensation income to the Optionee for federal or state income tax
purposes, the Optionee shall pay to the Company at the time of such exercise or
disposition (or such other time as the law permits if the Optionee is subject to
Section 16(b) of the Securities Exchange Act of 1934, as amended) such amount of
money as the Company may require to meet its obligation under applicable tax
laws or regulations; and, if the Optionee fails to do so, the Company is
authorized to withhold from any cash remuneration then or thereafter payable to
the Optionee, any tax required to be withheld by reason of such resulting
compensation income or Company may otherwise refuse to issue or transfer any
shares otherwise required to be issued or transferred pursuant to the terms
hereof. Payment of the withholding tax by the Optionee shall be made in
accordance with Section 12 of the Plan.
12. Resolution of Disputes. As a condition of the granting of the Option
hereby, the Optionee and his heirs and successors agree that any dispute or
disagreement which may arise hereunder shall be determined by the Committee in
its sole discretion and judgment, and that any such determination and any
interpretation by the Committee of the terms of this Option Agreement shall be
final and shall be binding and conclusive, for all purposes, upon the Company,
Optionee, his heirs and personal representatives.
13. Legends on Certificate. The certificates representing the shares of
Common Stock purchased by exercise of an Option will be stamped or otherwise
imprinted with legends in such form as the Company or its counsel may require
with respect to any applicable restrictions on sale or transfer and the stock
transfer records of the Company will reflect stop-transfer instructions with
respect to such shares.
14. Notices. Every notice hereunder shall be in writing and shall be given
by registered or certified mail. All notices of the exercise of any Option
hereunder shall be directed to Xxxxxx Corporation, 1500 Xxxxxx Building, 0000
Xxxxxx, Xxxxxxx, Xxxxx 00000-0000, Attention: Secretary. Any notice given by
the Company to Optionee directed to him at his address on file with the Company
shall be effective to bind him and any other person who shall acquire rights
hereunder. The Company shall be under no obligation whatsoever to advise
Optionee of the existence, maturity or termination of any of Optionee's rights
hereunder and Optionee shall be deemed to have familiarized himself with all
matters contained herein and in the Plan which may affect any of Optionee's
rights or privileges hereunder.
15. Construction and Interpretation. Whenever the term "Optionee" is used
herein under circumstances applicable to any other person or persons to whom
this award, in accordance with the provisions of Section 5 hereof, may be
transferred, the word "Optionee" shall be deemed to include such person or
persons. References to the masculine gender herein also include the feminine
gender for all purposes.
16. Agreement Subject to Plan. This Option Agreement is subject to the
Plan. The terms and provisions of the Plan (including any subsequent amendments
thereto) are hereby incorporated herein by reference thereto. In the event of a
conflict between any term or provision contained herein and a term or provision
of the Plan, the applicable terms and provisions of the Plan will govern and
prevail. All definitions of words and terms contained in the Plan shall be
applicable to this Option Agreement.
17. Employment Relationship. Employees shall be considered to be in the
employment of the Company as long as they remain employees of the Company or a
parent or subsidiary corporation (as defined in Section 424 of the Internal
Revenue Code of 1986, as amended). Any questions as to whether and when there
has been a termination of such employment and the cause of such termination,
shall be determined by the Committee, and its determination shall be final.
Nothing contained herein shall be construed as conferring upon the Optionee the
right to continue in the employ of the Company, nor shall anything contained
herein be construed or interpreted to limit the "employment at will"
relationship between the Optionee and the Company.
18. Binding Effect. This Option Agreement shall be binding upon and inure
to the benefit of any successors to the Company and all persons lawfully
claiming under Optionee.
IN WITNESS WHEREOF, this Option Agreement has been executed as of the ____
day of _______________, 19____.
ATTEST: XXXXXX CORPORATION
______________________________ By:_________________________________
OPTIONEE
____________________________________
