COLUMBIA SPORTSWEAR COMPANY STOCK OPTION AGREEMENT Non-Statutory Stock Option
EXHIBIT
99.1
Non-Statutory Stock Option
This STOCK OPTION AGREEMENT is made between COLUMBIA SPORTSWEAR COMPANY, an Oregon corporation (the
“Company”), and «Name» (the “Optionee”), pursuant to the Company’s 1997 Stock Incentive
Plan (the “Plan”) as amended. The Company and the Optionee agree as follows:
1. Option Grant. The Company hereby grants to the Optionee on the terms and conditions of
this Agreement the right and the option (the “Option”) to purchase all or any part of
«Options» shares of the Company’s Common
Stock at a purchase price of $________ per share.
The terms and conditions of the Option grant set forth in the attached Exhibit A are hereby
incorporated into and made a part of this Agreement. The Option is not intended to be an Incentive
Stock Option, as defined in Section 422A of the Internal Revenue Code of 1986, as amended (the
“Code”), and therefore is a Non-Statutory Stock Option.
2. Grant Date. The Grant Date for this Option is 2006. The Option shall
continue in effect until the date ten years after the Grant Date (the “Expiration Date”) unless
earlier terminated as provided in Sections 1 or 4 of Exhibit A.
3. Exercise of Option. No portion of the Option will be exercisable during the first
twelve months following the Grant Date. The Option shall become exercisable over a four-year
period as follows: (1) 25 percent of the Option shares shall become exercisable on the first day
of the first full month after the first anniversary of the Grant Date and (2) the remaining 75
percent of the Option shares shall vest ratably over a 36-month period following the date the
Option first becomes exercisable.
1. Termination of Service.
1.1. Unless otherwise determined by the Board of Directors of the Company, if the Optionee’s
employment by or service with the Company terminates for any reason other than because of total
disability or death, the Option may be exercised at any time prior to the Expiration Date or the
expiration of 90 days after the date of the termination, whichever is the shorter period, but only
if and to the extent the Optionee was entitled to exercise the Option at the date of termination.
1.2. If the Optionee’s employment by or service with the Company
terminates because of death or total disability (as defined in Section 6(a)(iv)(B) and (C) of the
Plan), the Option may be exercised at any time prior to the Expiration Date or the expiration of 12
months after the date of termination, whichever is the shorter period, but only if and to the
extent the Optionee was entitled to exercise the Option at the date of termination. If the
Optionee’s employment or service is terminated by death, the Option shall be exercisable only by
the person or persons to whom the Optionee’s rights under the Option pass by the Optionee’s will or
by the laws of descent and distribution of the state or country of the Optionee’s domicile at the
time of death.
2. Method of Exercise of Option.
2.1 Unless the Board of Directors determines otherwise, to exercise the Option, the Optionee
must give written notice to the Company stating the Optionee’s intention to exercise, specifying
the number of shares as to which the Optionee desires to exercise the Option and the date on which
the Optionee desires to complete the transaction. Delivering a notice of intent to exercise by
itself does not constitute exercise of the option; the Optionee must also deliver payment for the
shares set forth in the notice of intent to exercise. Unless the Board of directors determines
otherwise, on or before the date specified for completion of the purchase of shares pursuant to the
Option, the Optionee must pay the Company the full purchase price of such shares in cash or, in
whole or in part, in Common Stock of the Company valued at fair market value. No shares shall be
issued until full payment for the shares has been made.
2.2 After exercise of all or a part of the Option, the Optionee shall immediately upon
notification of the amount due, if any, pay to the Company in cash the amount necessary to satisfy
any applicable federal, state and local tax withholding requirements. If additional withholding is
or becomes required beyond any amount deposited before delivery of the certificates for the Option
shares, the Optionee shall pay such amount to the Company on demand. If the Optionee fails to pay
the amount
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demanded, the Company may withhold that amount from other amounts payable by the Company
to the Optionee, including salary or compensation, subject to applicable law.
3. Nontransferability of Option. The Option may not be assigned or transferred by the
Optionee, either voluntarily or by operation of law, except by will or by the laws of descent and
distribution of the state or country of the Optionee’s domicile at the time of death.
4. Changes in Capital Structure.
4.1 Stock Splits; Stock Dividends. If the outstanding Common Stock of the Company is
hereafter increased or decreased or changed into or exchanged for a different number or kind of
shares or other securities of the Company by reason of any stock split, combination of shares or
dividend payable in shares, recapitalization or reclassification, appropriate adjustment shall be
made by the Board of Directors in the number and kind of shares as to which the Option, or portions
thereof then unexercised, shall be exercisable. Adjustments shall be made without change in the
total price applicable to the unexercised portion of the Option and with a corresponding adjustment
in the Option price per share and shall neither (i) make the ratio, immediately after the event, of
the Option price per share to the fair market value per share more favorable to the Optionee than
that ratio immediately before the event nor (ii) make the aggregate spread, immediately after the
event, between the fair market value of shares as to which the Option is exercisable and the Option
price of such shares more favorable to the Optionee than that aggregate spread immediately before
the event. The Board of Directors shall have no obligation to effect any adjustment that would or
might result in the issuance of fractional shares, and any fractional shares resulting from any
adjustment may be disregarded or provided for in any manner determined by the Board of Directors.
Any such adjustments made by the Board of Directors shall be conclusive.
4.2 Mergers, Reorganizations, Etc. In the event of a merger, consolidation or plan of
exchange to which the Company is a party or a sale of all or substantially all of the Company’s
assets (each, a “Transaction”), the Board of Directors shall, in its sole discretion and to the
extent possible under the structure of the Transaction, select one of the following alternatives
for treating the Option:
4.2-1 The Option shall remain in effect in accordance with its terms.
4.2-2 The Option shall be converted into an option to purchase stock in the
corporation that is the surviving or acquiring corporation in the Transaction. The amount,
type of securities subject thereto and exercise price of the converted option shall be
determined by the Board of Directors of the Company, taking into account the relative
values of the companies involved in the Transaction and the exchange rate, if any, used in
determining shares of the surviving corporation to be issued to holders of shares of the
Company. Conversions shall be made without change in the total price applicable to the
unexercised portion of the Option and with a corresponding adjustment in the Option price
per share and shall neither (i) make
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the ratio, immediately after the event, of the Option
price per share to the fair market value per share more favorable to the Optionee than that
ratio immediately before the event nor (ii) make the aggregate spread, immediately after
the event, between the fair market value of shares as to which the Option is exercisable
and the Option price of such shares more favorable to the Optionee than that aggregate
spread immediately before the event. Unless otherwise determined by the Board of
Directors, the converted option shall be exercisable only to the extent that the
exercisabliity requirements relating to the Option have been satisfied.
4.2-3 The Board of Directors shall provide a 30-day period before the consummation of
the Transaction during which the Option may be exercised to the extent then exercisable,
and, upon the expiration of such 30-day period, the Option shall immediately terminate to
the extent not exercised. The Board of Directors may, in it sole discretion, accelerate
the exercisability of the Option so that it is exercisable in full during such 30-day
period.
4.3 Dissolution of the Company. In the event of the dissolution of the Company,
Options shall be treated in accordance with Section 4.2-3.
5. Conditions on Obligations. The Company shall not be obligated to issue shares of
Common Stock upon exercise of the Option if the Company is advised by its legal counsel that such
issuance would violate applicable state or federal laws, including securities laws. The Company
will use its best efforts to take steps required by state or federal law or applicable regulations
in connection with issuance of shares upon exercise of the Option.
6. Termination of Option on Violation of Code of Business Conduct and Ethics.
Optionee acknowledges that compliance with the Company’s Code of Business Conduct and Ethics is a
condition to the receipt, vesting and exercise of the Option. If, during the term of the Option,
the Board of Directors (or a committee of directors designated by the Board of Directors)
determines in good faith that Optionee’s conduct is or has been in violation of the Company’s Code
of Business Conduct and Ethics, then the Board of Directors or designated committee may terminate
the Option, with the date of termination determined by the Board of Directors or committee. If the
Option is terminated in accordance with this paragraph, Optionee will have no further right to
acquire shares of Company stock under this Agreement. If the President of the Company reasonably
believes that the Optionee has violated the Code of Business Conduct and Ethics and that the Board
of Directors or its committee should consider the termination of the Option, the President may
temporarily suspend the Optionee’s right to exercise the Option, for a period of up to 45 days, in
order for the Board of Directors or its committee to make a determination about Optionee’s conduct
and the potential termination of the Option.
7. Withholding. Upon notification of the amount due, if any, and prior to or
concurrently with delivery of the certificates representing the shares for which the Option was
exercised, Optionee shall pay to the Company amounts necessary to satisfy any applicable federal,
state, and local withholding tax requirements. If additional withholding
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becomes required beyond
any amount deposited before delivery of the certificates, Optionee shall pay such amount to the
Company on demand. If Optionee fails to pay any amount demanded, the company shall have the right
to withhold that amount from other amounts payable by the Company to Optionee, including salary,
subject to applicable law.
8. Successors of Company. This Agreement shall be binding upon and shall inure to the
benefit of any successor of the Company but, except as provided herein, the Option may not be
assigned or otherwise transferred by the Optionee.
9. Notices. Any notices under this Agreement must be in writing and will be effective
when actually delivered or, if mailed, three days after deposit into the United States mails by
registered or certified mail, postage prepaid. Mail shall be directed to the addresses stated on
the face page of this Agreement or to such address as a party may certify by notice to the other
party.
10. No Right to Employment or Service. Nothing in the Plan or this Agreement shall
(i) confer upon the Optionee any right to be employed or to continue in the employment of or
service to the Company; (ii) interfere in any way with the right of the Company to terminate the
Optionee’s employment or service with the Company at any time for any reason, with or without
cause, or to decrease the Optionee’s compensation or benefits; or (iii) confer upon the Optionee any right to continuation, extension, renewal, or modification of
any compensation, contract or arrangement with or by the Company.
11. Interpretation of the Plan and the Agreement. The Board of Directors, or a
committee of the Board responsible for administering the Plan, shall have the sole authority to
interpret the provisions of this Agreement and the Plan, and all determinations by it shall be
final and conclusive.
12. Governing Law, Venue and Jurisdiction. This Agreement and the Plan will be
interpreted under the laws of the state of Oregon, exclusive of choice of law rules. Venue and
jurisdiction will be in the state or federal courts in Washington County, Oregon, and nowhere else.
13. Consent to Transfer Personal Data. By signing this Agreement, the Optionee
voluntarily acknowledges and consents to the collection, use, processing and transfer of personal
data as described in this paragraph. The Optionee is not obliged to consent to such collection,
use, processing and transfer of personal data. However, failure to provide the consent may affect
the Optionee’s ability to participate in the Plan. The Company and its subsidiaries hold certain
personal information about the Optionee, including name, home address and telephone number, date of
birth, social security number or other employee identification number, salary, nationality, job
title, any shares of stock or directorships held in the Company, details of all options or any
other entitlement to shares of stock awarded, canceled, purchased, vested, unvested or outstanding
in the Optionee’s favor, for the purpose of managing and administering the Plan (“Data”). The
Company and/or its subsidiaries will transfer Data amongst themselves as necessary for the purpose
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of implementation, administration and management of participation in the Plan, and the Company
and/or any of its subsidiaries may each further transfer Data to any third parties assisting the
Company in the implementation, administration and management of the Plan. These recipients may be
located in the European Economic Area, or elsewhere throughout the world, such as the
United States. The Optionee authorizes them to receive, possess, use, retain and transfer the
Data, in electronic or other form, for the purposes of implementing, administering and managing the
Optionee’s participation in the Plan, including any requisite transfer of such Data as may be
required for the administration of the Plan and/or the subsequent holding of shares of stock on the
Optionee’s behalf to a broker or other third party with whom the Optionee may elect to deposit any
shares of stock acquired pursuant to the Plan. The Optionee may, at any time, review Data,
require any necessary amendments to it or withdraw the consents herein in writing by contacting the
Company; however, withdrawing consent may affect the Optionee’s ability to participate in the
Plan.
14. Acknowledgement of Discretionary Nature of the Plan; No Vested Rights. The
Optionee acknowledges and agrees that the Plan is discretionary in nature and limited in duration,
and may be amended, cancelled, or terminated by the Company, in its sole discretion, at any time.
The grant of stock options under the Plan is a one-time benefit and does not create any contractual
or other right to receive a grant of stock options or benefits in lieu of stock options in the
future. Future grants, if any, will be at the sole discretion of the Company, including, but not
limited to, the timing of any grant, the number of options, vesting provisions, and the exercise
price.
15. Termination Indemnities. Participation in the Plan is voluntary. The value of
the Option is an extraordinary item of compensation outside the scope of the Optionee’s employment
contract, if any. As such, the Option is not part of normal or expected compensation for purposes
of calculating any severance, resignation, redundancy, end of service payments, bonuses,
long-service awards, pension, or retirement benefits or similar payments. Rather, the awarding of
a stock option under the Plan represents a mere investment opportunity.
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