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EXHIBIT 10B
▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
2000 DIRECTOR AND OFFICER STOCK AWARD PLAN
Non-Qualified Stock Option Agreement
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Name of Employee:
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No. of Shares Covered: Date of Grant: , 2000
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Exercise Price Per Share: $2.00 Expiration Date: , 200
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Exercise Schedule (Cumulative):
No. of Shares
Date of As to Which Option
Exercisability* Becomes Exercisable
, 2006 -------------------
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* See Section 4 below regarding acceleration of Date of Exercisability
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This is a NON-QUALIFIED STOCK OPTION AGREEMENT between
▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., a Minnesota corporation ("▇▇▇▇▇▇▇▇▇▇.▇▇▇"), and the
employee or director of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or an Affiliate of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ listed
above (the "Employee").
WHEREAS, ▇▇▇▇▇▇▇▇▇▇.▇▇▇ desires to carry out the purposes of
its 2000 Director and Officer Stock Award Plan (the "Plan") by affording
Employee an opportunity to purchase shares of Common Stock of ▇▇▇▇▇▇▇▇▇▇.▇▇▇,
par value $.01 per share (the "Common Shares"), in accordance with the terms set
forth in this Agreement.
NOW, THEREFORE, ▇▇▇▇▇▇▇▇▇▇.▇▇▇ and Employee agree as follows:
1. GRANT OF OPTION. Subject to the terms of the Plan and this
Agreement, ▇▇▇▇▇▇▇▇▇▇.▇▇▇ hereby grants to Employee the right and option (the
"Option") to purchase the number of Common Shares specified at the beginning of
this Agreement. The Option is not intended to be an "incentive stock option"
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), but instead is intended to be a non-qualified stock
option.
2. PURCHASE PRICE. The purchase price of each of the Common
Shares subject to the Option shall be the Exercise Price Per Share specified at
the beginning of this Agreement, which equals 100% of the Fair Market Value (as
defined in the Plan) per Common Share on the Date of Grant.
3. OPTION EXERCISE PERIOD. (a) Subject to the provisions of
Sections 6(a), 6(b), and 7, the Option shall become exercisable as to the number
of shares and on the dates specified in the exercise schedule at the beginning
of this Agreement and in Section 4. The exercise schedule shall be cumulative,
which means that to the extent the Option has not already been exercised and has
not expired, terminated, or been canceled, Employee may at any time and from
time to time purchase all or any portion of the Common Shares then purchasable
under the exercise schedule.
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(b) The Option and all rights to purchase shares thereunder
shall cease on the earliest of: (i) The Expiration Date specified at the
beginning of this Agreement (which date is not more than 10 years after the date
of this Agreement); or (ii) The expiration of the period after Employee's
termination of employment within which the Option is exercisable as specified in
Section 6(a) or 6(b), whichever is applicable.
(c) Notwithstanding any other provision of this Agreement, no
one may exercise the Option, in whole or in part, after its Expiration Date.
4. ACCELERATION OF DATE OF EXERCISABILITY. This Option shall become
exercisable in full as of the date that a Spin-off (as defined in the Plan)
("Spin-off") has occurred, if such Spin-off occurs before the Date of
Exercisablity set forth on the first page of this Agreement.
5. MANNER OF EXERCISING OPTION. (a) Subject to the terms and conditions
of this Agreement, the Option may be exercised by delivering or mailing written
notice of exercise to ▇▇▇▇▇▇▇▇▇▇.▇▇▇ at its principal executive office, marked
for the attention of the Human Resources Department. The notice shall state the
election to exercise the Option, the number of Common Shares for which it is
being exercised, and be signed by the person exercising the Option. If the
person exercising the Option is not Employee, he or she shall enclose with the
notice appropriate proof of his or her right to exercise the Option. The date of
exercise of the Option shall be the date that the written notice of exercise
with appropriate payment under the following subsection (b) is actually received
by the Human Resources Department of ▇▇▇▇▇▇▇▇▇▇.▇▇▇.
(b) Notice of exercise of the Option shall be accompanied by
either: (i) payment (by certified or cashier's check payable to the order of
▇▇▇▇▇▇▇▇▇▇.▇▇▇) of the purchase price of the Common Shares being purchased; or
(ii) if so permitted by the Committee, certificates for unencumbered Common
Shares having an aggregate Fair Market Value (as defined in the Plan) on the
date of exercise equal to the purchase price of the Common Shares to be
purchased; or (iii) if so permitted by the Committee, a combination of cash and
such unencumbered Common Shares. The purchaser shall endorse all certificates
delivered to ▇▇▇▇▇▇▇▇▇▇.▇▇▇ under the foregoing subsections (b)(ii) or (iii) in
blank and represent and warrant in writing that he or she is the owner of the
shares so delivered free and clear of all liens, security interests, and other
restrictions or encumbrances.
(c) As soon as practicable after receipt of the purchase price
provided for above (and any payment required under Section 12), ▇▇▇▇▇▇▇▇▇▇.▇▇▇
shall deliver to the person exercising the Option, in the name of Employee (or
his or her estate or heirs, as the case may be) a certificate or certificates
representing the Common Shares being purchased. ▇▇▇▇▇▇▇▇▇▇.▇▇▇ shall pay all
original issue or transfer taxes, if any, with respect to the issue of the
Common Shares to the person exercising the Option and all fees and expenses
necessarily incurred by ▇▇▇▇▇▇▇▇▇▇.▇▇▇ in connection with the exercise of the
Option. All Common Shares issued upon exercise of the Option shall be fully paid
and nonassessable. Notwithstanding anything in this Agreement to the contrary,
▇▇▇▇▇▇▇▇▇▇.▇▇▇ shall not be required, upon exercise of the Option or any part
thereof, to issue or deliver any Common Shares unless such issuance has been
registered under federal and applicable state securities laws or an exemption
therefrom is available.
6. EXERCISABILITY OF OPTION AFTER TERMINATION OF EMPLOYMENT. (a) During
the lifetime of Employee, the Option may be exercised only while Employee is an
employee or director of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or an Affiliate and only if Employee has
been continuously so employed or acted as a director since the date of this
Agreement, except that:
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(i) If Employee has been continuously employed by or acted as
a director of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ (or an Affiliate or any person that was an
Affiliate during the twelve months prior to the Spin-off) for at least
12 full calendar months following the date of this Agreement, Employee
may exercise the Option within 90 days after termination of Employee's
employment, but only to the extent that the Option was exercisable
immediately prior to Employee's termination of employment or
resignation or removal as a director; and
(ii) If Employee is disabled (within the meaning of Section
22(e)(3) of the Code) while employed or acting as a director, Employee
(or his or her legal representative) may exercise the Option within one
year after the termination of Employee's employment or resignation or
removal as a director.
(b) In the event of Employee's death while employed by or
acting as a director of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or an Affiliate, or within 90 days after
his or her termination of employment or resignation or removal as a director,
the person designated by Employee as his or her beneficiary under this Agreement
on a form prescribed by and filed with the Committee, the legal representative
of Employee's estate, or the person who acquired the right to exercise the
Option by bequest or inheritance may exercise the Option within one year after
the death of Employee.
(c) Neither the transfer of Employee between ▇▇▇▇▇▇▇▇▇▇.▇▇▇
and any Affiliate nor a leave of absence granted to Employee and approved by the
Committee shall be deemed a termination of employment. A termination of
employment or director status with respect to ▇▇▇▇▇▇▇▇▇▇.▇▇▇ shall not be deemed
to be a termination of employment under this Agreement if Employee remains an
employee or director of any entity that is an Affiliate of ▇▇▇▇▇▇▇▇▇▇.▇▇▇
determined at the later of the termination of employment or immediately prior to
the Spin-off.
7. ACCELERATION OF OPTION ON DISABILITY OR DEATH. If Section 6(a)(ii)
or 6(b) of this Agreement is applicable, the Option, whether or not previously
exercisable, shall become immediately exercisable in full, but only if a
Spin-off has occurred on or before the date of the disability or death.
8. LIMITATION ON TRANSFER. During the lifetime of Employee, only
Employee or his or her guardian or legal representative may exercise the Option.
Employee may not assign or transfer the Option otherwise than by will, the laws
of descent and distribution, or under Section 17 of the Plan, and the Option
shall not be subject to pledge, attachment, or similar process. Any attempt to
assign, transfer, pledge, or otherwise dispose of the Option contrary to the
provisions of this Agreement, and the levy of any attachment or similar process
upon the Option, shall be null and void.
9. NO SHAREHOLDER RIGHTS BEFORE EXERCISE. Employee shall have none of
the rights of a shareholder of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ with respect to any share subject
to the Option until the share is actually issued to him or her upon exercise of
the Option.
10. OTHER BENEFIT AND COMPENSATION PROGRAMS. Payments and other
benefits received by Employee under this Agreement shall not be deemed a part of
Employee's regular, recurring compensation for purposes of the termination,
indemnity, or severance pay law of any country and shall not be included in, nor
have any effect on, the determination of benefits under any other employee
benefit plan, contract, or similar arrangement provided by ▇▇▇▇▇▇▇▇▇▇.▇▇▇ (or an
Affiliate of ▇▇▇▇▇▇▇▇▇▇.▇▇▇) unless expressly so provided by such other plan,
contract, or arrangement, or unless the Committee determines that the Option, or
a portion thereof, should be included to accurately recognize that the Option
has been made in lieu of a portion of competitive cash compensation, if such is
the case.
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11. CHANGES IN CAPITALIZATION; FUNDAMENTAL CHANGE. (a) The Committee
may in its sole discretion make appropriate adjustments in the number and types
of shares subject to the Option and in the Purchase Price Per Share to give
effect to any adjustments made in the number or types of shares of
▇▇▇▇▇▇▇▇▇▇.▇▇▇ through a dissolution or liquidation of ▇▇▇▇▇▇▇▇▇▇.▇▇▇, a sale of
substantially all of the assets of ▇▇▇▇▇▇▇▇▇▇.▇▇▇, a merger or consolidation of
▇▇▇▇▇▇▇▇▇▇.▇▇▇ with or into any other corporation (regardless of whether
▇▇▇▇▇▇▇▇▇▇.▇▇▇ is the surviving corporation), a statutory share exchange
involving capital stock of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ (each of the foregoing, a "Fundamental
Change"), a recapitalization, a reclassification, a stock dividend, a stock
split, a stock combination, or other relevant change.
(b) In the event of a proposed Fundamental Change which occurs after
the date a Spin-off has occurred: (i) involving a merger, consolidation, or
statutory share exchange, unless appropriate provision is made for the
protection of the Option by the substitution of options and appropriate voting
common stock of the corporation surviving any such merger or consolidation or,
if appropriate, the parent corporation of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or such surviving
corporation, to be issuable upon the exercise of options in lieu of the Option
and Common Shares, or (ii) involving the dissolution or liquidation of
▇▇▇▇▇▇▇▇▇▇.▇▇▇, the Committee shall provide written notice to Employee at least
20 days prior to the occurrence of the Fundamental Change that the Option,
whether or not then exercisable, shall be canceled at the time of, or
immediately prior to the occurrence of, the Fundamental Change in exchange for
payment to Employee (or the person then entitled to exercise the Option), within
10 days after the Fundamental Change, of cash equal to the amount, if any, for
each Common Share covered by the canceled Option, by which the Fair Market
Value, as defined in this Section 11(b), per Common Share exceeds the exercise
price per Common Share of the Option. At the time of the notice provided for in
the preceding sentence, the Option shall immediately become exercisable in full
and Employee (or the person then entitled to exercise the Option) shall have the
right, during the period preceding the time of cancellation of the Option, to
exercise the Option as to all or any part of the Common Shares covered by the
Option. In the event of a declaration under this Section 11(b), if the Option
shall not have been exercised prior to the Fundamental Change, it shall be
canceled at the time of, or immediately prior to, the Fundamental Change, as
provided in the notice. Notwithstanding the foregoing, Employee shall not be
entitled to the payment provided for in this Section 11(b) if the Option shall
have expired. For purposes of this Section 11(b) only, "Fair Market Value" per
Common Share means the cash plus the fair market value, as determined in good
faith by the Committee, of the non-cash consideration to be received per Common
Share by the shareholders of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ upon the occurrence of the
Fundamental Change, notwithstanding anything to the contrary in the Plan or this
Agreement.
12. TAX WITHHOLDING. ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or an Affiliate may be obligated to
withhold federal and state income taxes and social security or other taxes upon
Employee's exercise of the Option. If ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or an Affiliate is required
to withhold such taxes, Employee will promptly pay in cash upon demand to
▇▇▇▇▇▇▇▇▇▇.▇▇▇, or the Affiliate having such obligation, such amounts as shall
be necessary to satisfy such obligation, provided, however, that in lieu of all
or any part of such a cash payment, the Committee may, but shall not be required
to, permit Employee to elect to cover all or any part of the required
withholdings, and to cover any additional withholdings up to the amount needed
to cover Employee's full FICA and federal, state, and local income tax with
respect to income arising from the exercise of the Option, through a reduction
of the number of Common Shares delivered upon exercise or through a subsequent
return to ▇▇▇▇▇▇▇▇▇▇.▇▇▇ of shares delivered upon exercise, in each case valued
in the same manner as used in computing the withholding taxes under the
applicable laws. Further, such elections may be subject to the limitations of
the Exchange Act, as specified in Section 11 of the Plan.
13. INTERPRETATION OF THIS AGREEMENT. All decisions and interpretations
made by the Committee with regard to any question arising under this Agreement
or the Plan shall be binding
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and conclusive upon ▇▇▇▇▇▇▇▇▇▇.▇▇▇ and Employee. In the event that there is any
inconsistency between the provisions of this Agreement and the Plan, the
provisions of the Plan shall govern.
14. NO RIGHT TO EMPLOYMENT. This Agreement shall not give Employee a
right to continued employment with ▇▇▇▇▇▇▇▇▇▇.▇▇▇ or any Affiliate, and
▇▇▇▇▇▇▇▇▇▇.▇▇▇ or any Affiliate employing Employee may terminate his or her
employment and otherwise deal with Employee without regard to the effect it may
have upon him or her under this Agreement.
15. GENERAL. ▇▇▇▇▇▇▇▇▇▇.▇▇▇ shall at all times during the term of this
Option reserve and keep available such number of Common Shares as will be
sufficient to satisfy the requirements of this Option Agreement. A copy of the
Plan is available to Employee from ▇▇▇▇▇▇▇▇▇▇.▇▇▇ upon request. Unless the
context otherwise dictates, capitalized terms that are not defined in this
Agreement have the meaning set forth in the Plan from time to time. This
Agreement shall be binding in all respects on the Employee's heirs,
representatives, successors and assigns. This Agreement is entered into under
the laws of the State of Minnesota and shall be construed and interpreted
thereunder.
16. RIGHT OF FIRST REFUSAL. Employee acknowledges that any Shares
issued pursuant to an Option under this Agreement may be subject to a right of
first refusal on the part of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ to repurchase such shares in certain
instances as set forth in the Plan.
IN WITNESS WHEREOF, Employee and ▇▇▇▇▇▇▇▇▇▇.▇▇▇ have executed this
Agreement and it is effective as of the date of the grant of the Option.
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Employee
▇▇▇▇▇▇▇▇▇▇.▇▇▇, INC.
By:
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Its:
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