Exhibit 10.12
OPTION AGREEMENT
AGREEMENT made as of __________________, 2002 between Dick's Sporting
Goods, Inc., a Delaware corporation (the "Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
("Executive").
The Company and Executive desire to enter into an agreement pursuant to
which the Company will grant to Executive options under the Company's 2002 Stock
Plan to purchase certain shares of the Company's Common Stock, par value $.01
per share (the "Common Stock"), on the terms and conditions set forth herein and
in the Option Grant Agreement executed by and between the Company and Executive
on the date hereof (the "Grant Agreement"). All options to purchase Common Stock
are referred to herein as "Executive Options" and all shares of Common Stock
acquired upon exercise of such Executive Options (and all shares of Common Stock
hereafter acquired by Executive) are referred to herein as "Executive Stock".
1. GRANT OF EXECUTIVE OPTIONS. The Company hereby grants to Executive
certain Options (the "Initial Executive Options") to purchase from the Company
400,000 shares of Common Stock at an exercise price equal to the public offering
price set forth on the cover page of the Company's Prospectus for the initial
public offering of its Common Stock (the "Initial Exercise Price") and upon such
other terms and conditions set forth herein and in the Grant Agreement. In
addition, the Company agrees to grant on the date which is the first anniversary
of the entering into this Option Agreement to the Executive certain additional
Options (the "Additional Executive Options") to purchase from the Company
400,000 shares of Common Stock at an exercise price equal to the greater of 125%
of the Initial Exercise Price or the fair market value of the Company Stock and
upon such other terms and conditions as set forth herein and in the Grant
Agreement therefore.
2. TERM OF EXECUTIVE OPTIONS.
(a) The Executive Options shall be exercisable in installments as
follows (i) the Initial Executive Options shall vest and become exercisable on
the date which is the fourth anniversary of the entering into of this Agreement
and (ii) the Additional Executive Options shall vest and become exercisable on
the date which is the fifth anniversary of the entering into of this Agreement.
(b) Initial Executive Options will remain exercisable until no later
than the date which is the tenth anniversary of the entering into of this
Agreement and the Additional Executive Options will remain exercisable until no
later than the date which is the eleventh anniversary of entering into of this
Agreement. If Executive's employment with the Company terminates prior to the
date which is the fifth anniversary of the entering into of this Agreement all
Executive Options will terminate and be unexercisable as of (and subsequent to)
the termination date of Executive's employment, except that:
(i) if the Executive's employment has been terminated because
of Executive's death, all Executive Options shall vest and the
Executive's estate, personal representative or beneficiaries to whom
the Executive Options have been transferred may exercise such
installments for a period of twelve months after the date of
Executive's death;
(ii) if the Executive's employment has been terminated because
Executive is Disabled, all Executive Options shall vest and the
Executive may exercise such installments for a twelve month period
after Executive's employment has been terminated due to such
disability; and
(iii) if the Executive's employment has been terminated by the
Company for any reason other than Cause, Executive's resignation or any
voluntary action by the Executive, all Executive Options shall vest and
the Executive may exercise such installments for a period of 90 days
after such termination date.
In the event the Executive is terminated on or before the date which is the
first anniversary of the entering into of this Agreement under circumstances
described in clause (i), (ii) or (iii) which vest and permit the exercise of
Executive Options following the Executive's termination date, the Additional
Executive Options shall (i) immediately be granted at an exercise price equal to
the greater of 125% of the Initial Exercise Price or the fair market value on
the date of grant, (ii) immediately vest and (iii) be exercisable in accordance
with the periods set forth in clauses (i) through (iii) above.
In the event the Executive is terminated following the date which is the fifth
anniversary of the entering into of this Agreement under circumstances described
in clause (i) or clause (ii), the Executive Options shall be exerciseable for
the periods set forth in clauses (i) and (ii), subject to the limitation that no
Executive Option may be exercised after the stated expiration date of that
Executive Option.
(c) The "fair market value" for purposes of granting the Additional
Executive Options shall be determined as provided in the Company's 2002 Stock
Plan.
(d) For the purposes of this Agreement, "Disabled" shall be defined as
(i) the inability of Executive to perform his normal duties and functions as an
employee of the Company for a continuous period of at least 90 days or (ii) a
recurring disability that would prevent Executive from performing those normal
duties and functions for more than 14 days during every 90-day period for four
consecutive 90-day periods as determined in a good faith opinion by a physician
mutually agreeable to Executive and the Company or (iii) the failure of
Executive to in fact perform those normal duties and functions for 90
consecutive days. If Executive and the Company cannot agree on the choice of a
physician, Executive and the Company shall jointly select a physician each of
whom shall make an independent determination as to whether Executive is Disabled
or not. If such physicians selected by Executive and the Company do not agree,
they each shall select a third physician who shall determine whether Executive
is Disabled. Such determination by such third physician shall be final.
(e) For purposes of this Agreement, "Cause" shall be defined as: (i)
fraud or felonious conduct by the Executive; (ii) embezzlement or
misappropriation of funds or property of the Company by the Executive; (iii)
material breach of this Agreement by the Executive or any material violation of
the Company's rules, policies or procedures set forth in the Company's Employee
Handbook (as in effect from time to time); (iv) gross negligence by the
Executive; or (v) the Executive's consistent inability or refusal to perform, or
willful misconduct in or disregard of the performance of his duties and
obligations properly assigned to him.
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3. CONFIDENTIAL INFORMATION. Executive acknowledges that the
information, observations and data obtained by him during the course of his
performance of his duties to the Company concerning the business or affairs of
the Company and its affiliates are the property of the Company. Therefore,
Executive agrees that he will not disclose to any unauthorized person or use for
his own account any of such information, observations or date without the
Board's written consent, unless and to the extent that the aforementioned
matters become generally known to and available for use by the public other than
as a result of Executive's acts or omissions to act. Executive agrees to deliver
to the Company at the termination of his employment all memoranda, notes, plans,
records, reports and other documents (and copies thereof) relating to the
business of the Company and its affiliates which he may then possess or have
under his control.
4. INVENTIONS AND PATENTS. Executive agrees that all inventions, or
patents with respect to the Company's business conceived or made by him during
his employment with the Company belong to the Company. Executive will promptly
disclose such inventions or patents to the Board and perform all actions
reasonably requested by the Board to establish and confirm such ownership.
5. COVENANTS REGARDING COMPETITION AND EXECUTIVE.
(a) Beginning on the date hereof and continuing for the Restricted
Period (as defined in Section 5(b)), the Executive shall not:
(i) Own, manage, control, be employed by, be a consultant to,
participate in, or be connected in any manner with the ownership, management,
operation, or control of any entity that owns and/or operates Big Box (as
defined in Section 5(b)) sporting goods retail stores in a metropolitan area
where the Company operates such a store or stores, or has specific plans to open
such a store within one year after the date on which the Executive's employment
with the Company terminates, if the Executive had been informed of such store
opening plans prior to the such termination date, specifically including but not
limited to The Sports Authority, Inc., Gart Sports Company, ▇▇▇▇▇▇'▇ Trading
Company, Gander Mountain/Holiday Companies, Bass Pro Shops and Cabela's, Inc.,
and their respective successors and affiliates; or
(ii) Induce or solicit, directly or indirectly, any person who
is an employee, officer or agent of the Company to terminate said relationship,
or otherwise assist in the recruitment of any Company employee to accept
employment with another employer.
(b) For purposes of this Section 5, (i) the "Restrictive Period" means
a period of twelve (12) consecutive months from the date of Executive's
termination, and (ii) "Big Box" means a store specializing in the sale of goods
having at least twenty-five thousand (25,000) square feet of selling space
dedicated substantially to the retail sale of hard and soft line sporting goods
and apparel, including single stores, stores that are part of regional or
nationwide chains, specialty stores, and any other sales establishments
otherwise meeting the foregoing definition.
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6. NOTICES. Any notice provided for in this Agreement must be in
writing and must be either personally delivered, or mailed by first class mail,
to the Recipient at the address below indicated:
To Company:
Dick's Sporting Goods, Inc.
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▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Secretary
To Executive:
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or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or mailed.
7. SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
8. COMPLETE AGREEMENT. This Agreement along with, those documents
expressly referred to herein and other documents of even date herewith embody
the complete agreement and understanding among the parties and supersede and
preempt any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
9. CHOICE OF LAW. The corporate law of the State of Delaware will
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Agreement will be governed by the internal law, and not
the law of conflicts, of the Commonwealth of Pennsylvania.
10. REMEDIES. Each of the parties to this Agreement will be entitled to
enforce its rights under this Agreement specifically, to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights existing in its favor. The parties hereto agree and acknowledge
that money damages may not be an adequate remedy for any breach of the
provisions of this Agreement and that any party may in its sole discretion apply
to any court of law or equity of competent jurisdiction for specific performance
and/or injunctive relief in order to enforce or prevent any violations of the
provisions of this Agreement.
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11. AMENDMENTS AND WAIVERS. Any provision of this Agreement may be
amended or waived only with the prior written consent of the company and
Executive.
12. SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Executive, the Company and the
Company's successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first above written.
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Dick's Sporting Goods, Inc.
By:_________________________________
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