EXHIBIT 10.2
ICONIX BRAND GROUP, INC.
NON-QUALIFIED NON-PLAN STOCK OPTION AGREEMENT
ICONIX BRAND GROUP, INC., a Delaware corporation (the
"Company"), hereby grants to Xxxxxxx Xxxxxxxx, an employee of the Company (the
"Optionee"), as of July 22, 2005 (the "Grant Date"), a non-qualified non-plan
stock option to purchase a total of 1,425,000 shares of the Company's common
stock, par value $.001 per share ("Common Stock"), at $8.81 per share. This
option (the "Option"), which is being granted pursuant to the Employment
Agreement (as hereinafter defined), is intended to be a non-qualified stock
option, i.e., this Option is not intended to be, nor is it, an incentive stock
option as defined in Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
1. Duration.
(a) This Option was granted as of the Grant Date.
(b) This Option shall expire at the close of business on July 22, 2015, (the
"Termination Date"), but shall be subject to earlier termination as provided
herein.
(c) If the Optionee ceases to be employed by the Company as a result of a
termination by the Company for Cause (as defined in the Employment Agreement
dated July 22, 2005 between the Company and the Optionee (the "Employment
Agreement")), or voluntary termination by Optionee without Good Reason (as
defined in the Employment Agreement), the Optionee's right to exercise any
unexercised portion of this Option shall case forthwith, and this Option shall
thereupon terminate.
In the event the Optionee's employment is terminated by the
Company without Cause, or by voluntary termination by the Optionee for Good
Reason, the Optionee's right to exercise any unexercised portion of this Option
shall cease forthwith, and this Option shall thereupon terminate, however,
Optionee shall be entitled to such payments as set forth in Section 5.4.2 of the
Employment Agreement.
In the event the Optionee's employment with the Company is
terminated due to his Disability (as defined in the Employment Agreement), the
Option shall be exercisable within the earlier of: (i) one (1) year after the
date of such Disability or, (ii) July 22, 2015. In such event, the Option shall
be exercisable to the extent that the right to purchase the shares of Common
Stock hereunder has accrued on the date the Optionee becomes disabled.
In the event of the death of the Optionee while an employee of
the Company, the Option shall be exercisable to the extent exercisable but not
exercised as of the date of death and in such event, the Option must be
exercised, if at all, within the earlier of (i) one (1) year after the date of
death of the Optionee or (ii) July 22, 2015.
In the event the Optionee's employment with the Company is
terminated due to expiration of the Employment Agreement's Term (as defined in
the Employment Agreement), the Option shall remain exercisable until and
including the date which is one (1) year after the Company has determined the
Royalty Revenues for the year ended 2010, in accordance with the Employment
Agreement.
2. Price.
The purchase price for each share of Common Stock upon
exercise of this Option (the "Purchase Price") shall be $8.81, subject to
adjustment as provide in Section 5 hereof.
3. Non-Qualified Stock Option.
This Option is a non-qualified stock option, the exercise
of which is subject to Section 83 of the Code.
4. Written Notice of Exercise.
This Option, to the extent it is exercisable as provided in
Section 10 herein, may be exercised only by delivering to the Company, at its
principal office within the time specified in Section 1 hereof or such shorter
time as is otherwise provided for herein, a written notice of exercise
substantially in the form described in Section 10.
5. Anti-Dilution Provisions.
(a) If there is any stock dividend or recapitalization resulting in a stock
split, or combination or exchange of shares of Common Stock of the Company, the
number of shares of Common Stock then subject to this Option and the Purchase
Price may be proportionately and appropriately adjusted by the Board of
Directors of the Company (the "Board"); provided, however, that any fractional
shares resulting from any such adjustment shall be eliminated.
(b) If there is any other change in the Common Stock of the Company, including
recapitalization, reorganization, sale or exchange of assets, exchange of
shares, offering of subscription rights, or a merger or consolidation in which
the Company is the surviving corporation, an adjustment, if any, shall be made
in the shares then subject to this Option as the Board in its sole discretion
may deem appropriate. Failure of the Board to provide for an adjustment pursuant
to this subparagraph prior to the effective date of any Company action referred
to herein shall be conclusive evidence that no adjustment has been approved by
the Board in consequence of such action and that no such adjustment will be made
in consequence of such action.
6. Investment Representation.
The Optionee agrees that until such time as a registration
statement under the Securities Act of 1933, as amended (the "Act"), becomes
effective with respect to this Option and/or the shares of Common Stock
underlying this Option, the Optionee is taking this Option and shall take the
shares of Common Stock underlying this Option, for the Optionees own account,
for investment, and not for resale or distribution.
7. Transferability. Except as may be otherwise provided by the Board or an
appropriate committee of the Board, as the case may be, at or after the Grant
Date, the Option shall not be transferable otherwise than by will or the laws of
descent and distribution, and the Option may be exercised during the lifetime of
the Optionee only by the Optionee. No transfer of the Option by the Optionee by
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will or by the laws of descent and distribution shall be effective to bind the
Company unless the Company shall have been furnished with written notice thereof
and a copy of the will and such other evidence as the Company may deem necessary
to establish the validity of the transfer and the acceptance by the transferor
or transferees of the terms and conditions of such Option.
8. Certain Rights Not Conferred by Option.
The Optionee shall not, by virtue of holding this Option, be
entitled to any rights of a stockholder in the Company.
9. Transfer Taxes.
The Company shall pay all original issue and transfer taxes
with respect to the issuance and transfer of shares of Common Stock of the
Company pursuant hereto provided that the shares are issued in the name of the
Optionee.
10. Vesting Options.
(a) The amount of shares of Common Stock to this Option shall become exercisable
as follows: 225,000 shall vest on the Grant Date and 1,200,000 shall vest in
accordance with section 2.6 of the Employment Agreement, a copy of which is
attached hereto as Exhibit A.
(b) This Option shall be exercisable by written notice of such exercise, in the
form prescribed by the Board to the Company, at its principal executive office.
The notice shall specify the number of shares for which the Option is being
exercised, be signed by the Optionee and shall be accompanied by payment in cash
or by check of the amount of the full purchase price of such shares or in such
manner as the Board shall deem acceptable.
(c) No shares shall be delivered upon exercise of this Option until all laws,
rules and regulations which the Board may deem applicable have been complied
with. If a registration statement under the Act is not then in effect with
respect to the shares issuable upon such exercise, the Company may require as a
condition precedent, among other things (i) that the person exercising the
Option give to the Company a written representation and undertaking,
satisfactory in form and substance to the Company, that such person is acquiring
the shares for his own account for investment and not with a view to the
distribution thereof and/or (ii) an opinion of counsel satisfactory to the
Company with respect to the existence of an exemption from the registration
requirements of the Act, in which event the person(s) acquiring the Common Stock
shall be bound by the provisions of the following legend which shall be endorsed
upon the certificate(s) evidencing his option shares issued pursuant to such
exercise:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"). Such shares may not be sold, transferred or otherwise
disposed of unless they have first been registered under the
Act or, unless, in the opinion of counsel satisfactory to the
Company's counsel, such registration is not required."
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(d) Without limiting the generality of the foregoing, the Company may delay
issuance of the shares of Common Stock underlying this Option until completion
of any action or obtaining of any consent, which the Company deems necessary
under any applicable law (including without limitation state securities or "blue
sky" laws).
(e) The person exercising this Option shall not be considered a record holder of
the stock so purchased for any purpose until the date on which such person is
actually recorded as the holder of such stock in the records of the Company.
11. No Continued Employment.
Nothing herein shall be deemed to create any employment
agreement or guaranty of continued service as the employee or limit in any way
the Company's right to terminate Optionee's status as the employee at any time.
12. Notices.
Any notice required or permitted by the terms of this
Agreement shall be given by registered or certified mail, return receipt
requested, addressed as follows:
To the Company:
Iconix Brand Group, Inc.
000 X. 00xx Xxxxxx, 0xx xxxxx
Xxx Xxxx, X.X. 10018
Attention: President
To the Optionee:
Xxxxxxx Xxxxxxxx
c/o Windsong Inc.
0000 Xxxx Xxxx Xxxx
Xxxxxxx, XX 00000
or to such other address or addresses of which notice in the same manner has
previously been given when mailed in accordance with the foregoing provisions.
Either party hereto may change the address to which such notices shall be given
by providing the other party hereto with written notice of such change.
13. Tax Withholding.
Not later than the date as of which an amount first becomes
includable in the gross income of the Optionee or other holder for federal
income tax purposes with respect to this Option, the Optionee or other holder
shall pay to the Company, or make arrangements satisfactory to the Company
regarding the payment of, any federal, state and local taxes of any kind
required by law to be withheld or paid with respect to such amount. The
obligations of the Company under this Agreement shall be conditional upon such
payment or arrangements and the Company shall, to the extent permitted by law,
have the right to deduct any such taxes from any payment of any kind otherwise
due to the holder of the option from the Company or any of its subsidiaries.
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14. Benefit of Agreement.
This Agreement shall be for the benefit of and shall be
binding upon the heirs, executors, administrators and successors of the parties
hereto.
15. Governing Law.
This Agreement shall be construed and enforced in accordance
with the law of the State of New York, except to the extent that the laws of the
State of Delaware may be applicable.
ICONIX BRAND GROUP, INC.
By: /s/Xxxx Xxxx
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Name:Xxxx Xxxx
Title: President and CEO
Accepted as of the date first set above.
/s/Xxxxxxx Xxxxxxxx
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Signature required with return of document to the Company to formalize issuance
of agreement.
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