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EXHIBIT 10.20
ASSOCIATES FIRST CAPITAL CORPORATION
LONG-TERM EQUITY COMPENSATION PLAN
STOCK OPTION AWARD AGREEMENT - 1996
You have been selected to be a Participant in the Associates First Capital
Corporation Long-Term Equity Compensation Plan (the "Plan") for 1996, through
this grant of nonqualified stock options/tandem stock appreciation rights
(hereinafter for purposes of this Agreement referred to as "Stock Options" or
"Options"), as specified below:
PARTICIPANT:
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ADDRESS:
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OPTION NO.:
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DATE OF ▇▇▇▇▇:
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NUMBER OF SHARES COVERED BY THIS AGREEMENT:
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OPTION PRICE:
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DATE OF EXPIRATION:
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Except as hereinafter provided, you may exercise this Option in accordance with
the following vesting schedule:
NUMBER OF SHARES SUBJECT TO CUMULATIVE NUMBER OF SHARES
DATE OPTION WHICH BECOMES AVAILABLE FOR EXERCISE
EXERCISABLE ON THIS DATE
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THIS AGREEMENT, effective commencing as of the morning of, but
prior to, commencement of trading on the New York Stock Exchange on the Date of
Grant set forth above, represents the grant of a stock option by Associates
First Capital Corporation, a Delaware corporation (the "Company"), to the
Participant named above, pursuant to the provisions of the Plan.
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The Plan provides a description of certain terms and
conditions governing the Option. If there is any inconsistency between the terms
of this Agreement and the terms of the Plan, the Plan's terms shall completely
supersede and replace the conflicting terms of this Agreement. All capitalized
terms shall have the meanings ascribed to them in the Plan, unless specifically
set forth otherwise herein. The parties hereto agree as follows:
1. GRANT OF STOCK OPTION. The Company hereby grants to the Participant an
Option to exercise the number of Shares set forth above, at the stated
Option Price, which is 100 percent of the Fair Market Value of a Share
on the Date of Grant, in the manner and subject to the applicable
terms and conditions of the Plan and this Agreement.
2. EXERCISE OF STOCK OPTION. Except as hereinafter provided, the
Participant may exercise this Option as provided in Article 3 of this
Agreement and according to the vesting schedule set forth on page 1 of
this Agreement, provided that no exercise may occur prior to the end
of one (1) year following the Date of Grant or subsequent to the close
of business on the Date of Expiration (shown on page 1 of this
Agreement).
This Option may be exercised in whole or in part, but not for less
than 50 Shares at any one time, unless fewer than 50 Shares then
remain subject to the Option, and the Option is then being exercised
as to all such remaining Shares. Options may be exercised only for
full Shares may; no Option is exercisable for fractional Shares.
3. PROCEDURE FOR EXERCISE OF OPTION. This Option may be exercised only
during a "Window Period" (as defined below), by delivery of the Notice
of Exercise to the Company, addressed to the attention of its
Compensation Committee, c/o ▇▇▇▇ ▇▇▇. "Window Period" means the
period beginning on the third (3rd) business day following the date of
public release of the Company's quarterly sales and earnings
information, and ending on the twelfth (12th) business day following
such date. Notwithstanding the foregoing and except with respect to
Insiders as specified below, the Company may at any time in its sole
discretion, change, extend, or eliminate a window period or otherwise
designate the times at which the Option may be exercised. The
Participant shall elect on the Notice of Exercise whether the stock
option or the stock appreciation rights portion of the award is being
exercised. Exercise of the stock option portion shall cancel the
corresponding portion represented by stock appreciation rights, and
exercise of the stock appreciation rights portion shall cancel the
corresponding portion represented by stock options.
(a) Exercise of stock appreciation rights portion of award. If
the stock appreciation rights portion of the Option is
exercised, the Participant shall elect one of the two
following alternatives:
(i) Payout in cash: If this alternative is elected, the
Company shall pay to the Participant in cash (or by
check) an amount equal to (A) the excess of the Fair
Market Value of a Share on the date of exercise (as
determined by the Committee or its designee), over
the Option Price, multiplied by (B) the
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number of Shares under the Option being exercised.
Applicable taxes shall be withheld from the cash
payout. Participants who are notified by the Company
that they are Insiders may elect this alternative,
subject to Committee approval, only within a Window
Period.
(ii) Payout in Stock: If this alternative is elected, the
Company shall deliver to the Participant the number
of whole Shares of Company Stock necessary to deliver
to the Participant value equal to (A) the excess of
the Fair Market Value of a Share on the date of
exercise (as determined by the Committee or its
designee), over the Option Price, multiplied by (B)
the number of Shares under the Option being
exercised, minus (C) the withholding taxes.
(b) Exercise of Stock Option portion of award. If the Stock
Option portion of the Option is exercised, the Participant
shall deliver to the Company the Option Price in full either:
(i) in cash or its equivalent; (ii) by tendering previously
acquired Shares having an aggregate Fair Market Value at the
time of exercise equal to the Option Price (provided that the
Shares so tendered must have been held by the Participant for
at least six months prior to their tender); or (iii) by a
combination of (i) and (ii). As soon as practicable following
exercise, the Company shall deliver to the Participant
certificates for the Shares purchased, net of tax withholding
as provided below, if applicable.
The Company shall have the right to deduct or withhold, or
have the Participant remit to the Company, an amount
sufficient to satisfy Federal, state, and local taxes
(including the Participant's FICA obligation) required by law
to be withheld with respect to such exercise. The Participant
may elect in connection with an exercise under this Section
3(b), subject to the approval of the Committee, to satisfy the
withholding requirement, in whole or in part, by having the
Company withhold Shares having an aggregate Fair Market Value
on the date of exercise equal to the amount required to be
withheld. All elections shall be irrevocable and in writing,
and shall be signed by the Participant in advance of the date
the transaction becomes taxable. In addition, any such
election by Participants who have been notified by the Company
that they are Insiders must be either:
(i) Delivered to the Committee at least six (6) months
prior to the date specified by the Participant on
which the exercise of the Option is to occur; or
(ii) Be made pursuant to an exercise of an Option which
occurs during a Window Period.
4. TERMINATION OF EMPLOYMENT:
(a) By Retirement, Disability or death: In the event of a
Participant's Retirement, Disability or death, the Option
shall continue in effect and shall become fully vested
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and exercisable during the applicable periods in accordance
with the provisions hereof. In the event of the Participant's
death, the beneficiary designated pursuant to Article 8 hereof,
or if no such beneficiary is designated or deemed to be
designated or if none survives such Participant, the executor
or administrator of the estate of the decedent or the person or
persons to whom the Option shall have been validly transferred
by the executor or the administrator pursuant to will or the
laws of descent and distribution, shall have the right to
exercise the Option, when vested, in accordance with the
provisions hereof.
(b) By transfer to Ford or Ford Subsidiaries: In the event the
Participant transfers to Ford Motor Company ("Ford") or a Ford
Subsidiary (as hereinafter defined) the Option shall continue
in effect and shall become fully vested and exercisable during
the applicable periods in accordance with the provisions
hereof. The term "Ford Subsidiary" when used herein shall
mean any corporation a majority of the voting stock of which
is owned directly or indirectly by Ford.
(c) By termination for Cause or resignation: In the event of the
resignation of employment by the Participant or termination of
the Participant's employment by the Company for Cause, the
Option shall be forfeited effective as of the date of such
resignation or termination and the Participant's right to
exercise this Option shall cease. For purposes of the Plan, a
termination by the Company for Cause shall include termination
resulting from (a) action by the Participant involving willful
malfeasance, (b) the Participant's unreasonable neglect or
refusal to perform the executive duties assigned to the
Participant, (c) the Participant's being convicted of a
felony, (d) the Participant's engaging in any activity that is
directly or indirectly in competition with the Company or any
affiliate or in any activity that is inimical to the best
interests of the Company or any affiliate, or (e) the
Participant's violation of Company policy covering standards
of corporate conduct. If the Company terminates the
Participant's employment for Cause, all of the Company's
obligations under this Agreement shall thereupon cease and
terminate.
(d) By termination other than for Cause or within 12 months of a
Change in Control: In the event that the Participant's
employment is terminated by the Company other than for Cause,
or a Change in Control occurs that results in termination of
the Participant's employment by the Company other than for
Cause within 12 months of a Change in Control, the Option
shall become vested upon the date of that termination and
shall be exercisable to the extent permitted under the
provisions hereof until the Date of Expiration (as shown on
page 1 of this Agreement). For purposes of this Article,
"Change in Control" means any of the following:
(i) Any merger, consolidation or similar
combination with or involving the Company, as
of the date of the conclusion of such event,
other than a merger, consolidation or similar
combination of the Company with Ford or any
of its affiliates;
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(ii) Any transaction or series of transactions
that results in the sale or divestiture of
all or substantially all of the Company's
assets, as of the conclusion of such
transaction or series of transactions;
(iii) Any capital reorganization, transaction or
series of transactions that results in Ford
and its affiliates owning common stock of the
Company having less than 50% of the combined
voting power of the outstanding capital stock
of the Company, as of the date of the
conclusion of such reorganization,
transaction or series of transactions; or
(iv) The successful completion of a public
offering, or distribution to the public by
dividend or spinoff, that results in Ford and
its affiliates owning common stock of the
Company having less than 50% of the combined
voting power of the outstanding capital stock
of the Company.
For purposes of section (d) of this Article, termination shall
include "Constructive Termination," which shall be deemed to
have occurred if any of the following result from a Change in
Control:
(i) The assignment to the Participant of any
duties inconsistent in any respect with the
Participant's position (including status,
offices, titles and reporting requirements),
authority, duties or responsibilities or any
other action which results in a substantial
diminution in such position, authority,
duties or responsibilities, excluding for
this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and
which is remedied by the employer promptly
after receipt of notice thereof given by the
Participant;
(ii) Any failure to (x) continue to provide the
Participant with the opportunity to
participate, on terms substantially
comparable in the aggregate to those in
effect immediately prior to the Change in
Control, in substantially the same benefit or
compensation plans and programs, including
the Company's life, disability, health and
retirement plans in which the Participant was
participating immediately prior to the date
of the Change in Control, or their
equivalent, or (y) provide the Participant
with all other fringe benefits (or their
equivalent) from time to time in effect for
the benefit of any executive, management or
administrative group of the Company which
customarily includes a person holding the
employment position with the Company then
held by the Participant; or
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(iii) Without the Participant's express written
consent, a substantial reduction, without
good business reasons, of the facilities
and perquisites available to the Participant
immediately prior to such reduction.
(e) Termination for reasons not listed above: In the event of a
termination of the Holder's employment for reasons other than
Disability, death, Retirement, transfer to Ford or a Ford
Subsidiary, resignation or termination by the Company for
Cause, the portion of the Option which is vested as of the
date of termination of employment are exercisable to the
extent permitted under Articles 2 and 7 hereof until the
earlier of (i) the Date of Expiration (as defined on page 1 of
this Agreement) or (ii) the end of the 90th day following the
date of termination of employment. No other rights under this
Agreement will continue in effect or continue to accrue from
the date of termination forward.
5. EFFECT OF COMPETITIVE ACTIVITY OR INIMICAL CONDUCT. Anything
contained herein to the contrary notwithstanding, the right of the
Participant to exercise the Option shall remain effective only if,
during the entire period from the Date of Grant to the date of such
exercise, the Participant shall have earned the Option by refraining
from engaging in any activity that is directly or indirectly in
competition with any activity of the Company or any subsidiary or
affiliate thereof. The term "subsidiary" shall mean any corporation a
majority of the voting stock of which is owned directly or indirectly
by the Company.
In the event of the Participant's nonfulfillment of the condition set
forth in the immediately preceding paragraph, the Participant's right
to exercise such Option shall cease; provided, however, that the
nonfulfillment of such condition may at any time be waived by the
Committee upon its determination that in its sole judgment there shall
not have been and will not be any substantial adverse effect upon the
Company or any subsidiary or affiliate thereof by reason of the
nonfulfillment of such condition.
The right of the Participant to exercise the Option shall cease on and
as of the date on which it has been determined by the Committee that
the Participant at any time acted in a manner inimical to the best
interests of the Company or any subsidiary or affiliate thereof.
Conduct which constitutes engaging in an activity that is directly or
indirectly in competition with any activity of the Company or any
subsidiary or affiliate thereof shall be governed by the preceding
paragraphs of this Article 5 and shall not be subject to any
determination under this paragraph.
6. 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. Further, this
Option shall be exercisable during the Participant's lifetime only by
the Participant or the Participant's legal representative.
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7. RECAPITALIZATION. In the event there is any change in the Company's
Shares through the declaration of stock dividends or through
recapitalization resulting in stock split-ups or through merger,
consolidation, exchange of Shares, or otherwise, the number and class
of Shares subject to this Option, as well as the Option Price may be
equitably adjusted by the Committee, in its sole discretion, to prevent
dilution or enlargement of rights.
8. BENEFICIARY DESIGNATION. The Participant may, from time to time, name
any beneficiary or beneficiaries (who may be named contingently or
successively) to whom any benefit under this Agreement is to be paid
in case of such Participant's death before he or she receives any or
all of such benefit. Each such designation shall revoke all prior
designations by the Participant, shall be in a form prescribed by the
Company, and will be effective only when filed by the Participant in
writing with the Company during the Participant's lifetime. In the
absence of any such designation, the Participant's beneficiary shall
be deemed to be the Person or Persons who receive the Participant's
life insurance proceeds under the Company-paid life insurance plan.
9. RIGHTS AS A STOCKHOLDER. The Participant shall have no rights as a
stockholder of the Company with respect to the Shares subject to this
Option Agreement until such time as the Option Price has been paid,
and the Shares have been issued and delivered to him or her.
10. NO RIGHT OF EMPLOYMENT. This Agreement shall not confer upon the
Participant any right to continuation of employment by the Company,
nor shall this Option Agreement interfere in any way with the
Company's right to terminate the Participant's employment at any time.
11. MISCELLANEOUS.
(a) This Agreement and the rights of the Participant hereunder are
subject to all the terms and conditions 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 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 the Participant.
(b) With the approval of the Board, the Committee may, subject to
the terms of the Plan, terminate, amend, or modify the Plan;
provided, however, that no such termination, amendment, or
modification of the Plan may in any way adversely affect the
Participant's vested rights under this Agreement, without the
written consent of the Participant.
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(c) The Participant agrees to take all steps necessary to comply
with all applicable provisions of federal and state securities
law in exercising his or her rights under this Agreement.
(d) 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.
(e) All obligations of the Company under the Plan and this
Agreement, with respect to this Option, shall be binding on
any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially
all of the business and/or assets of the Company.
(f) 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 Texas.
(g) The grant of the Option to the Participant is completely
discretionary and does not create any rights to receive future
stock option grants.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the Date of ▇▇▇▇▇.
Associates First Capital Corporation
By:
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▇▇▇▇▇ ▇. ▇▇▇▇▇, Executive Vice President
The foregoing Option hereby is accepted on the terms and conditions set forth
herein and in the Plan.
Participant's Signature: Date:
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Note: Please sign one copy of this Agreement and send it to:
Compensation Committee
c/o ▇▇▇▇ ▇. ▇▇▇
Associates First Capital Corporation
P.O. Box 660237
Dallas, TX 75266-0237
Keep the other copy for your records.
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