STOCK OPTION GRANT AGREEMENT
Exhibit 10.2
THIS AGREEMENT, made as of this 12th day of May, 2004, between J.CREW GROUP, INC. (the “Company”) and Xxxxxxx X. Xxxxxxx (the “Participant”).
WHEREAS, the Company has adopted and maintains the J.Crew Group, Inc. 2003 Equity Incentive Plan (the “Plan”) to promote the interests of the Company and its stockholders by providing the Company’s key employees and others with an appropriate incentive to encourage them to continue in the employ of the Company and to improve the growth and profitability of the Company;
WHEREAS, the Plan provides for the Grant to Participants in the Plan of Non-Qualified Stock Options to purchase shares of Common Stock of the Company;
NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter set forth, the parties hereto hereby agree as follows:
1. Grant of Options. Pursuant to, and subject to, the terms and conditions set forth herein and in the Plan, the Company hereby Grants to the Participant the following NON-QUALIFIED STOCK OPTIONS (collectively, the “Options”):
(a) Premium Option Tranche 1. An Option with respect to 111,585 shares of Common Stock of the Company (the “Premium Option Tranche 1”); and
(b) Premium Option Tranche 2. An Option with respect to 111,585 shares of Common Stock of the Company (the “Premium Option Tranche 2” and together with the Premium Option Tranche 1, the “Premium Options”).
2. Grant Date. The Grant Date of the Options hereby granted is March 26, 2004.
3. Incorporation of the Plan. Except as otherwise provided herein, all terms, conditions and restrictions of the Plan are incorporated herein and made part hereof as if stated herein. Notwithstanding anything to the contrary in the Plan, if there is any conflict between the terms and conditions of the Plan and this Agreement, the terms and conditions of this Agreement, as interpreted by the Committee, shall govern. Unless otherwise indicated herein, all capitalized terms used herein shall have the meanings given to such terms in the Plan.
4. Exercise Price. The Exercise Price of each share underlying the Options are as follows:
(a) Premium Option Tranche 1. $15.00 per share; and
(b) Premium Option Tranche 2. $25.00 per share.
5. Vesting Date. The Options shall become exercisable as follows: 25% of the shares of Common Stock underlying each Option shall vest on February 1, 2005, 25% of the shares of Common Stock underlying each Option shall vest on February 1, 2006, 25% of the shares of Common Stock underlying each Option shall vest on February 1, 2007, and 25% of the shares of Common Stock underlying each Option shall vest on February 1, 2008; provided that the Participant remains continuously Employed by the Company through each such applicable Vesting Date. Notwithstanding the foregoing, (A) in the event that (x) the Company terminates the Participant’s Employment without Cause (as defined in and pursuant to the Employment Agreement, dated as of January 24, 2003, between the Company, J. Crew Operating Corp., and the Participant (the “Employment Agreement”)), the Participant terminates his Employment for Good Reason (as defined in and pursuant to the Employment Agreement) or the Participant’s Employment terminates as a result of the Company’s providing notice to the Participant of its intent not to renew the Employment Period (as defined in the Employment Agreement) prior to the consummation of a Change in Control or (y) the Participant’s Employment is terminated on account of the Participant’s death or Disability (as defined in and pursuant to the Employment Agreement) at any time during the Employment Period, the portion of each of the Options that would have become vested and exercisable on the next succeeding Vesting Date shall vest and become immediately exercisable and any remaining portion of the Options that has not become vested and exercisable shall immediately expire and be forfeited, (B) in the event that, within the two-year period following the consummation of a Change in Control or within six months prior to a Change in Control if such termination is in contemplation of the Change in Control, the Company terminates the Participant’s Employment without Cause, the Participant terminates his Employment for Good Reason or the Participant’s Employment terminates as a result of the Company’s providing notice to the Participant of its intent not to renew the Employment Period, all shares of Common Stock underlying the Options shall become immediately
vested and exercisable; and (C) if the Participant’s Employment terminates for any other reason, any portion of the Options which has not become exercisable on such Date of Termination (as defined in the Employment Agreement) shall immediately expire and be forfeited.
6. Expiration Date. Subject to the provisions of the Plan and this Agreement, with respect to the Options (or any portions thereof) which have not become exercisable, the Options shall expire on the date the Participant’s Employment is terminated for any reason, and with respect to any Options (or any portions thereof) which have become exercisable, the Options shall expire on the earlier of (A) the tenth anniversary of the Grant Date, (B) the commencement of business on the date the Participant’s Employment is terminated for Cause, (C) ninety days after the Participant’s Employment is terminated by the Participant without Good Reason, or (D) the second anniversary of the date the Participant’s Employment is terminated (x) on account of the Participant’s death or Disability, (y) by the Company without Cause, or (z) by the Participant for Good Reason.
7. Delays or Omissions. No delay or omission to exercise any right, power, or remedy accruing to any party hereto upon any breach or default of any party under this Agreement, shall impair any such right, power or remedy of such party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party or any provisions or conditions of this Agreement, shall be in writing and shall be effective only to the extent specifically set forth in such writing.
8. Limitation on Transfer. During the lifetime of the Participant, the Options shall be exercisable only by the Participant. The Options shall not be assignable or transferable otherwise than by will or by the laws of descent and distribution. Notwithstanding the foregoing, the Participant may request authorization from the Committee to assign the Participant’s rights with respect to the Options granted herein to a trust or custodianship, the beneficiaries of which may include only the Participant, the Participant’s spouse or the Participant’s lineal descendants (by blood or adoption), and, if the Committee grants such authorization, the Participant may assign the Participant’s rights accordingly. In the event of any such assignment, such trust or custodianship, or in the event of the Participant’s death, his beneficiaries or estate, shall be subject to all the restrictions, obligations, and responsibilities as apply to the Participant under the Plan and this Agreement and shall be entitled to all the rights of the Participant under the Plan. All shares of Common Stock obtained pursuant to the Option granted herein shall not be transferred except as provided in the Plan and, where applicable, the Stockholders’ Agreement. In the event of any purported Transfer of any portion of the Options in violation of the provisions of the Plan and this Agreement, such purported Transfer shall, to the extent permitted by applicable law, be void and of no effect.
9. Integration. This Agreement, the Plan and the Stockholders’ Agreement contain the entire understanding of the parties with respect to its subject matter. There are no restrictions, agreements, promises, representations, warranties, covenants or undertakings with respect to the subject matter hereof other than those expressly set forth herein, in the Plan, the Employment Agreement and the Stockholders’ Agreement. This Agreement, the Plan and the Stockholders’ Agreement supersede all prior agreements and understandings between the parties with respect to its subject matter.
10. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.
11. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of NEW YORK, without regard to the provisions governing conflict of laws.
12. Participant Acknowledgment. The Participant hereby acknowledges receipt of a copy of the Plan. The Participant hereby acknowledges that all decisions, determinations and interpretations of the Committee in respect of the Plan, this Agreement and the Options shall be final and conclusive.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by its duly authorized officer and said Participant has hereunto signed this Agreement on the Participant’s own behalf, thereby representing that the Participant has carefully read and understands this Agreement and the Plan as of the day and year first written above.
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J.CREW GROUP, INC. |
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/s/ Xxxxxx Xxxxxx |
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By: Xxxxxx Xxxxxx |
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Title: Chief Financial Officer |
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/s/ Xxxxxxx X. Xxxxxxx |
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Xxxxxxx X. Xxxxxxx |
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