Exhibit 10.2
COMMON STOCK ISO AGREEMENT
COMMON STOCK ISO AGREEMENT, dated as of November 12, 2004, by and
between ▇'▇▇▇▇▇▇▇▇ INDUSTRIES HOLDINGS, INC., a Delaware corporation (the
"Company"), and __________________________ (the "Optionee"). Capitalized terms used but
not otherwise defined herein shall have the meanings assigned to such terms in Section 1.
WHEREAS, the Optionee is currently an employee of the Company, and the
Company desires to grant the Optionee certain Common Stock options in accordance with the
terms hereof pursuant to the Company's Common Stock Option Plan; and
WHEREAS, the options are intended to qualify as "incentive stock options" as
defined in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code");
NOW THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties to this Agreement agree as follows:
1 Definitions. As used herein, the following terms shall have the following
meanings:
"Board" means the Board of Directors of the Company.
"BRS" means Bruckmann, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Co. II, L.P.
"Cause" means (i) a material breach of this Agreement by the Optionee, (ii) a breach of
the Optionee's duty of loyalty to the Company and its Subsidiaries, or (iii) the Optionee's
commission of a crime involving an act of moral turpitude or which constitutes a felony in the
jurisdiction in which the Optionee is employed, regardless of whether the crime involves the
Company or any of its Subsidiaries.
"Committee" means the Compensation Committee or such other committee of the Board
as the Board may designate to administer the Plan or, if for any reason the Board has not
designated such a committee, the Board. The Committee, if other than the Board, shall be
composed of not fewer than two directors as appointed from time to time by the Board.
"Common Stock" means the Class A Common Stock, par value $0.01 per share, of the
Company.
"Expiration Date" means the close of business on November 12, 2014 subject to earlier
expiration as provided in Section 4.
"Fair Market Value" per share on any given date means the average of the closing prices
of the sales of the Common Stock on all securities exchanges on which such stock may at the time
be listed, or, if there have been no sales of Common Stock on any such exchange on any day, the
average of the highest bid and lowest asked prices for such stock on all such exchanges at the end
of such day, or, if on any day such stock is not so listed, the average of the representative bid and
asked prices quoted for such stock on the NASDAQ National Market System as of 4:00 P.M.,
New York time, or, if on any day such stock is not quoted on the Nasdaq National Market System,
the average of the highest bid and lowest asked prices for such stock on such day in the domestic
over-the-counter market as reported by the National Quotation Bureau, Incorporated, or any
similar successor organization. If at any time the Common Stock is not listed or quoted, the Fair
Market Value per share shall be the fair market value of the Common Stock determined by the
Board in good faith, giving effect to the preferences and priorities set forth in the Company's
Certificate of Incorporation (as amended from time to time) with respect to other series or classes
of the Company's capital stock, and also based on such other factors as the members thereof in
the exercise of their business judgment, consider relevant.
"Form" means those forms of the Internal Revenue Service used by taxpayers to file federal
income tax returns or reports required under the Code or applicable Treasury Regulations
promulgated thereunder.
"Measurement Date" means the date on which any taxable income resulting from the
exercise of an Option is determined under applicable federal income tax law.
"Options" has the meaning set forth in Article IV of the Stock Option Plan.
"Option Agreements" means collectively, this Agreement and each of the other Common
Stock ISO Agreements, by and between the Company and each of certain employees of the
Company.
"Option Shares" shall mean (i) all shares of Common Stock issued or issuable upon the
exercise of an Option and (ii) all shares of Common Stock issued with respect to the Common
Stock referred to in clause (i) above by way of stock dividend or stock split or in connection with
any conversion, merger, exchange, consolidation, reclassification or recapitalization or other
reorganization affecting the Common Stock. Unless provided otherwise herein, Option Shares will
continue to be Option Shares in the hands of any holder other than the Optionee (except for the
Company), and each such transferee thereof will succeed to the rights and obligations of a holder
of Option Shares hereunder.
"Permitted Transferee" means those Persons to whom the Optionee is authorized to transfer
Option Shares pursuant to the terms hereof, including those Persons to whom Options may be
transferred under Section 2(e).
"Person" means an individual, a partnership, a corporation, a limited liability company,
an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or
a government entity (or any department, agency or political subdivision thereof).
"Registration Rights Agreement" means the Registration Rights Agreement, dated as of
November 30, 1999, by and among the Company and certain other parties thereto.
"Sale of the Company" means a merger or consolidation effecting a change in control of
the Company, a sale of all or substantially all of the assets of the Company or a sale of a majority
of the outstanding voting securities of the Company effecting a change in control of the Company.
"Securities Act" has the meaning ascribed thereto in Article 1 of the Stock Option Plan.
"Stockholders Agreement" means the Stockholder Agreement, dated as of November 30,
1999, by and among the Company and certain other parties thereto.
"Stock Option Plan" means the Company's_____ Common Stock Option Plan.
"Subsidiary" means any subsidiary corporation (as such term is defined in Section 424(f)
of the Code) of the Company.
"Termination Date" shall mean the date upon which such Participant's employment with
the Company and the Subsidiaries terminated.
"TPA" means the Optionee's Termination Protection Agreement entered into by and
between the Optionee and the Company, if any.
2 The Options.
(a) Terms of the Options. The Company hereby grants to the Optionee, as of
the date hereof, an option (the "Option" or "Options") to purchase up to _______ shares
of the Company's Common Stock (the "Option Shares") at the exercise price of $0.01 per
Option Share (the "Exercise Price"), subject to the terms and conditions set forth herein.
All rights of the Optionee as the holder of the Options issued hereunder shall be solely
determined by the provisions of this Agreement. The Optionee's Options will expire as
provided in Section 4 hereof.
(b) Form of the Options. The Options granted hereunder are intended to be
incentive stock options as defined in Section 422 of the Code.
(c) Payment of Exercise Price. Subject to Section 3 below, the Options may
be exercised in whole or in part, at any time and from time to time, upon payment of an
amount (the "Option Price") equal to the product of (i) the applicable Exercise Price for
the applicable Options multiplied by (ii) the number of Option Shares to be acquired.
Payment shall be made (x) in cash, by bank or certified check, (y) by delivering to the
Company for cancellation certificates for shares of the Company's Common Stock owned
by the Optionee for a period of at least six months having a Fair Market Value equal to the
full purchase price of the shares being acquired, or (z) a combination of cash and such
shares.
(d) Procedure for Exercise. The Optionee may exercise all or any portion of
the Options at any time and from time to time prior to their expiration as set forth in
Section 4, by filing written notice of exercise to the Company, together with payment of
the Option Price in accordance with the provisions of Section 2(c) above. As a condition
to any exercise of any Option, the Optionee will (i) permit the Company to deliver to him
all financial and other information regarding the Company (if any) it believes necessary to
enable the Optionee to make an informed investment decision and (ii) execute a joinder to
the Stockholders Agreement and the Registration Rights Agreement.
(e) Non-Transferability of Options. The Optionee's Options are personal to the
Optionee and are not transferable by the Optionee other than by will or the laws of descent
and distribution. During the Optionee's lifetime, only the Optionee may exercise the
Options. In the event of the Optionee's death, the Options may be exercised only (i) by
the executor or administrator of the Optionee's estate or the Person or Persons to whom
the Optionee's rights under the Options shall pass by will or the laws of descent and
distribution (provided that each beneficiary shall execute and deliver an undertaking in
writing to be bound by the terms of this Agreement in form and substance acceptable to
the Committee) and (ii) to the extent that the Optionee was entitled to exercise such
Options hereunder at the date of the Optionee's death.
(f) Adjustments. If and to the extent specified by the Board, the number of
shares of Common Stock which may be issued pursuant to the exercise of the Options, and
the Exercise Price of the Options, shall be equitably adjusted for any stock dividend, stock
split, recapitalization, merger, consolidation or other recapitalization with respect to the
Common Stock; provided, that any Options to purchase fractional shares of Common Stock
resulting from any such adjustment shall be rounded to the nearest whole share.
Adjustments under this Section 2(f) shall be made by the Board in its reasonable discretion,
whose determination as to what adjustments shall be made, and the extent thereof, shall be
final, binding and conclusive.
3 Vesting.
(a) Vesting of Options. Unless otherwise provided in this Agreement or the
Stock Option Plan, the Option shall entitle the Optionee to purchase, in whole at any time
or in part from time to time, _________ of the total number of Shares covered by the
Option after the expiration of one year from the date of this Agreement and an additional
_________ of the total number of Shares covered by the Option after the expiration of each
of the second, _____________________ anniversaries of the date of this Agreement, and
each such right of purchase shall be cumulative and shall continue, unless sooner exercised
or terminated as herein provided, until the close of business on the date the Option expires
or is terminated. All of the Options which have become vested are referred to herein as
"Vested Options," and all other Options are referred to herein as "Unvested Options."
(b) Sale of the Company. Notwithstanding anything contained in Section 3(a)
to the contrary, if the Optionee has been employed by the Company or its Subsidiaries
from the date hereof through the earlier of the date of (i) the consummation of a Sale of the
Company or (ii) the consummation of an IPO, all Unvested Options beneficially owned by
the Optionee, its Related Parties, if any, or their respective permitted transferee as of such
date shall automatically become Vested Options. All Options shall terminate if not
exercised as of the date of the Sale of the Company and all such Options shall thereafter
represent only the right to receive the excess of the consideration per share of Common
Stock offered in such Sale of the Company over the exercise price of such Options. The
Company shall give the Optionee notice of an impending Sale of the Company at least 15
days prior to the date of such Sale of the Company.
4 Expiration. The Options not exercised shall expire on the Expiration Date.
Furthermore, if any part of any Option is not exercised prior to the date the Optionee's
employment with the Company is terminated (the "Termination Date"), such unexercised portion
of the Options shall expire and be forfeited on such date; provided, however, that if the Optionee
(i) dies or becomes subject to any complete and permanent disability (as defined in
Section 422(c)(6) of the Code) the part of the Option that is unexercised shall expire 180 days from
the date of death or Disability, but in no event after November 12, 2014, (ii) retires (with the
approval of the Board), the part of the Option that is unexercised shall expire three months from
the date of retirement, but in no event after November 12, 2014 and (iii) is discharged other than
for Cause, the part of the Option that is unexercised shall expire 30 days from the date of
discharge, but in no event after November 12, 2014. In the event of the death of the Optionee,
Options that are unexercised on the date of his death may be exercised by only the executor or
administrator of the Optionee's estate or the person or persons to whom the Optionee's rights
under the Options pass by will or by the laws of descent and distribution. In the event that the
Optionee (or the Optionee's executor, administrator or permitted successor as described in the
immediately preceding sentence) exercises any Option following the Optionee's Termination Date,
the repurchase right of the Company set forth in Section 5 shall be extended for a period of sixty
days.
5 Repurchase Option. In the event the Optionee's employment with the Company
is terminated (the "Termination") for any reason, all of the Option Shares (whether held or
beneficially owned by the Optionee, the Optionee's Related Parties or any transferee of the
Optionee or the Optionee's Related Parties) will be subject to repurchase by the Company and BRS
(or its designee) pursuant to the terms and conditions set forth in this Section 5 (the "Repurchase
Option").
(a) With respect to each holder of Option Shares, the purchase price for each
Option Share will be the Fair Market Value for such share. Notwithstanding the foregoing
to the contrary, in the event any such Termination is by the Company for Cause, the
purchase price for each shall be the Exercise Price paid to acquire such Option Share.
(b) The Board may elect to cause the Company to purchase all or any portion
of the Option Shares by delivering written notice (the "Repurchase Notice") to the holder
or holders of the Option Shares within 45 days after the Termination. The Repurchase
Notice will set forth the number of Option Shares to be acquired from each holder, the
aggregate consideration to be paid for such securities and the time and place for the closing
of the transaction. The number of shares to be repurchased by the Company shall first be
satisfied to the extent possible from the Option Shares held by the Optionee at the time of
delivery of the Repurchase Notice. If the number of Option Shares held by the Optionee
is less than the total number of Option Shares the Company has elected to purchase, the
Company shall purchase the remaining shares elected to be purchased from the other
holder(s) of Option Shares (i.e., the Optionee's Related Parties or any Permitted Trans
feree under the Stockholders Agreement) under this Agreement, pro rata according to the
number of Option Shares held by such other holder(s) at the time of delivery of such
Repurchase Notice (determined as nearly as practicable to the nearest share).
(c) If for any reason the Company does not elect to purchase all of the Option
Shares pursuant to the Repurchase Option, BRS (or its designee) shall be entitled to
exercise the Repurchase Option for all or any portion of the Option Shares that the
Company has not elected to purchase (the "Available Shares"). As soon as practicable
after the Company has determined that there will be Available Shares, but in any event
within 45 days after the Termination, the Company shall give written notice (the "Option
Notice") to BRS (or its designee) setting forth the number of any Available Shares. BRS
(or its designee) may elect to purchase all or a portion of the Available Shares by giving
written notice to the Company within 30 days after the Option Notice has been given by
the Company. As soon as practicable, and in any event within ten days after the expiration
of the 30-day period set forth above, the Company shall notify each holder of Option
Shares as to the number of Available Shares being purchased from such holder by BRS (or
its designee) (the "Supplemental Repurchase Notice"). At the time the Company delivers
the Supplemental Repurchase Notice to the holder(s) of Option Shares, the Company shall
also deliver written notice to BRS (or its designee) setting forth the number of Option
Shares which BRS (or its designee) is entitled to purchase, the aggregate purchase price
and the time and place of the closing of the transaction.
(d) The closing of the purchase of the Option Shares pursuant to the
Repurchase Option shall take place on the date designated by the Company in the
Repurchase Notice or Supplemental Repurchase Notice, which date shall not be later than
the 60th day after the delivery of the later of such notices to be delivered (or, if later, the
15th day after the Fair Market Value is finally determined) nor earlier than the fifth day
after such delivery. The Company and/or BRS (or its designee) will pay for the Option
Shares to be purchased pursuant to the Repurchase Option by delivery of a certified or
cashier's check or wire transfer of funds. The purchasers of Option Shares hereunder will
be entitled to receive customary representations and warranties from the sellers thereof as
to title, authority and capacity to sell and to require all sellers' signatures to be guaranteed.
(e) Notwithstanding anything to the contrary contained in this Agreement, all
repurchases of Option Shares by the Company shall be subject to applicable restrictions
contained in the Delaware General Corporation Law. If any such restrictions prohibit the
repurchase of Option Shares hereunder which the Company is otherwise entitled to make,
the Company may make such repurchases as soon as it is permitted to do so under such
restrictions.
6 Restrictions on Option Shares; Securities Laws Matters.
(a) Restrictions on Transfer of Option Shares. The Optionee may not sell,
pledge, or otherwise transfer any interest in any Option Shares without the prior written
consent of the Company. If the Optionee or anyone claiming under or through the Optionee
attempts to violate this Section 6(a), such attempted violation shall be null, void, and
without effect. The Optionee acknowledges that the Option Shares will also be subject to
the provisions of the Stockholders Agreement.
(b) Securities Laws Matters. The Optionee hereby agrees that the Option
Shares that the Optionee may acquire by exercising the Option will not be sold or
otherwise disposed of in any manner that would constitute a violation of any applicable
federal or state securities laws. The Optionee acknowledges that all Common Stock issued
pursuant to the terms of this Agreement shall may not be transferred except in compliance
with the registration requirements of the Securities Act or an exemption therefrom. In
connection with any such transfer, the Company may require the transferor to provide a
written opinion of counsel to the effect that such transfer complies with the Securities Act
and other applicable securities laws.
(c) Listing, Registration, and Legal Compliance. If at any time the Board
determines that the listing, registration, or qualification of the Option Shares upon any
securities exchange or under any state or federal securities or other law or regulation, or
the consent or approval of any governmental regulatory body, is reasonably required as a
condition to or in connection with the purchase or issuance of Option Shares upon the
exercise of Options, no Options may be granted or exercised, in whole or in part, unless
such listing, registration, qualification, consent, or approval shall have been effected or
obtained free of any conditions not acceptable to the Board. The Optionee agrees to supply
the Company with such certificates, representations, and information as the Company shall
request and shall otherwise cooperate with the Company in obtaining such listing,
registration, qualification, consent, or approval. The Company hereby agrees to make all
such filings and registrations as are reasonably required to effectuate the terms of this
Agreement. In the case of officers and other persons subject to Section 16(b) of the
Securities Exchange Act of 1934, as amended, the General Counsel may impose, at any
time, any limitations upon the exercise of Options that, in the General Counsel's
discretion, are necessary or desirable in order to comply with such Section 16(b) and the
rules and regulations thereunder.
7 Amendment and Waiver. The Board may amend or modify any Option; provided,
that no amendment or modification shall impair or adversely affect the rights of the Optionee
without the consent of the Optionee. To the extent any amendment of the Stockholders Agreement
or Registration Rights Agreement requires the consent of holders of Common Stock, such
amendment shall require the consent of holders of a majority of the Common Stock on an as-
exercised basis (i.e., assuming full exercise of all options to purchase Common Stock).
8 Withholding Tax Requirements.
(a) Amount of Withholding. It shall be a condition to the exercise of any
Option that the Optionee make appropriate payment or other provision acceptable to the
Company with respect to any withholding tax requirement arising from such exercise. The
amount of withholding tax required, if any, with respect to any Option exercise (the
"Withholding Amount") shall be determined by the Chief Financial Officer or other
appropriate officer of the Company, and the Optionee shall furnish such information as
such officer requests in order to make such determination.
(b) Withholding Procedure. If the Company determines that withholding tax
is required with respect to any Option exercise, the Company shall notify the Optionee of
the Withholding Amount, and the Optionee shall pay to the Company an amount not less
than the Withholding Amount. In lieu of making such payment, the Optionee may pay the
Withholding Amount by either (i) delivering to the Company a number of shares of
Common Stock having an aggregate Fair Market Value as of the Measurement Date not
less than the Withholding Amount, or (ii) directing the Company to withhold and not
deliver or issue to the Optionee a number of shares of Common Stock, otherwise issuable
upon the exercise of the Option, having an aggregate Fair Market Value as of the
Measurement Date not less than the Withholding Amount. Any fractional interests
resulting from the delivery or withholding of shares of Common Stock to meet withholding
tax requirements shall be settled in cash. All amounts paid to or withheld by the Company
and the value of all shares of Common Stock delivered to or withheld by the Company
pursuant to this Section 8 shall be deposited in accordance with applicable law by the
Company as withholding tax for the Optionee's account. If the Chief Financial Officer or
other appropriate officer of the Company determines that no withholding tax is required
with respect to the exercise of any Option, but it is determined subsequently that the
exercise resulted in taxable income as to which withholding is required (as a result of a
disposition of the Option Shares or otherwise), the Optionee shall promptly, upon being
notified of the withholding requirement, pay to the Company (by means acceptable to the
Company) the amount required to be withheld, and the Company may, at its election,
condition any transfer of Option Shares issued upon exercise of the Option upon receipt
of such payment.
(c) Notification of Inquiries and Agreements. The Optionee and each Permitted
Transferee shall notify the Company in writing within ten days after the date the Optionee
or any such Permitted Transferee (i) first obtains knowledge of any Internal Revenue
Service inquiry, audit, assertion, determination, investigation, or question relating in any
manner to the value of Options granted hereunder; (ii) includes or agrees (including,
without limitation, in any settlement, closing, or other similar agreement) to include in
gross income with respect to any Option granted under this Agreement (A) any amount in
excess of the amount reported on Form 1099 or Form W-2 to the Optionee by the
Company, or (B) if the Optionee received no such Form, any amount; or (iii) sells,
disposes, or otherwise transfers Option Shares acquired pursuant to this Agreement. Upon
request, the Optionee or any such Permitted Transferee shall provide to the Company any
information or document relating to any event described in the preceding sentence which
the Company (in its sole discretion) requires in order to calculate and substantiate any
change in the Company's tax liability as a result of such event.
9 Representations and Warranties of the Optionee. As an inducement to the
Company to enter into this Agreement and grant the Options, the Optionee hereby represents and
warrants to the Company as follows:
(a) Capacity and Power. The Optionee has full capacity, power and authority
to execute and deliver this Agreement, to perform his or her obligations under this
Agreement and to consummate the transactions contemplated hereby. This Agreement has
been duly executed and delivered by the Optionee and constitutes a valid and binding
agreement, enforceable against him or her in accordance with its terms, subject to
applicable bankruptcy, insolvency and other similar laws affecting the enforceability of
creditors' rights generally, general equitable principles and the discretion of courts in
granting equitable remedies.
(b) No Conflict. The execution, delivery and performance by the Optionee of
this Agreement and the transactions contemplated hereby and the fulfillment by him or her
of and compliance by him or her with the terms and conditions of this Agreement do not
and will not, violate or conflict with any terms or provisions of (i) any contract, deed,
lease or other agreement to which he or she is a party or to which any of his or her assets
are subject or (ii) any judgment, decree, order, statute, rule or regulation applicable to,
him or her or any of his or her assets, except for such violations which could not
reasonably be expected to materially impair or delay his or her ability to consummate the
transactions contemplated hereby. No consent, approval, order or authorization of, or
registration, declaration or filing with, any government agency or public or regulatory
share, agency, body or authority with respect to him or her is required in connection with
his or her execution, delivery or performance of this Agreement or the consummation of
the transactions contemplated hereby other than any of the foregoing, the failure of which
to receive or make, as the case may be, could not reasonably be expected to materially
impair or delay his or her ability to consummate the transactions contemplated hereby.
10 Representations and Warrants of the Company. As an inducement to enter into
this Agreement, the Company hereby represents and warrants to each Optionee as follows:
(a) The Company is a corporation validly existing and in good standing under
the laws of the State of Delaware and is qualified to do business in every jurisdiction in
which its ownership of property or conduct of business requires it to qualify, except for
such jurisdictions in which the failure to so qualify, would not have a material adverse
effect on the Company.
(b) The execution, delivery and performance of this Agreement have been duly
authorized by the Company. This Agreement constitutes a valid and binding obligation of
the Company, enforceable in accordance with its terms, except to the extent that the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting creditors' rights generally and by general
principles of equity.
11 Confidential Information. The Optionee acknowledges that the information,
observations and data obtained by him/her while employed by the Company or any of its
Subsidiaries concerning the business or affairs of the Company or any Subsidiary ("Confidential
Information") are the property of the Company or such Subsidiary. Therefore, the Optionee
agrees that he/she will not disclose to any unauthorized person or use for his own account any
Confidential Information without the prior written consent of the Board, unless and to the extent
that the aforementioned matters (i) become generally known to and available for use by the public
other than as a result of the Optionee's acts or omissions to act or (ii) are required to be disclosed
under applicable law or a duly issued subpoena. The Optionee shall deliver to the Company at
the termination of the Optionee's employment, or at any other time the Company may request, all
memoranda, notes, plans, records, reports, computer tapes and software and other documents and
data (and copies thereof) relating to the Confidential Information, Work Product (as defined
below) and the business of the Company or any Subsidiary which he/she may then possess or have
under his/her control.
12 Inventions and Patents. The Optionee agrees that all inventions, innovations,
improvements, developments, methods, designs, analyses, drawings, reports, and all similar or
related information which relates to the Company's or any of its Subsidiaries' actual or anticipated
business, research and development or existing or future products or services and which are
conceived, developed or made by the Optionee while employed by the Company or any of its
Subsidiaries ("Work Product") belong to the Company or such Subsidiary. The Optionee will
promptly disclose such Work Product to the Company or its Subsidiaries and perform all actions
reasonably requested by the Company or its Subsidiaries (whether during or after the Optionee's
employment period) to establish and confirm such ownership (including, without limitation,
assignments, consents, powers of attorney and other instruments).
13 Noncompete; Nonsolicitation.
(a) The Optionee acknowledges that in the course of his/her employment with
the Company and its Subsidiaries he/she has become familiar, and he will become familiar,
with the Company's and its Subsidiaries' trade secrets and with other Confidential
Information and that his/her services have been and will be of special, unique and
extraordinary value to the Company and its Subsidiaries. Therefore, the Optionee agrees
that, during the time he/she is employed by the Company and its Subsidiaries and
thereafter for a period equal to one year, or such longer period for which the Optionee
receives compensation from the Company pursuant to a TPA or otherwise (the
"Noncompete Period"), he/she will not directly or indirectly own, manage, control,
participate in, consult with, render services for, or in any manner engage in any business
(including by himself or through any other entity) competing with the businesses of the
Company or its Subsidiaries as such businesses exist or are in process on the date of the
termination of the Optionee's employment. Nothing herein will prohibit the Optionee from
being a passive owner of not more than 2% of the outstanding stock of a corporation which
is publicly traded, so long as the Optionee has no active participation in the business of
such corporation.
(b) During the Noncompete Period, the Optionee shall not directly or indirectly
through another entity (i) induce or attempt to induce any employee of the Company or any
Subsidiary of the Company to leave the employ of the Company or such Subsidiary, or in
any way materially interfere with the relationship between the Company or any Subsidiary
of the Company and any employee thereof, (ii) hire any person who was an employee of
the Company or any Subsidiary of the Company within the last twelve months prior to the
termination of the Optionee's employment with the Company, or (iii) induce or attempt to
induce any customer, supplier, licensee or other business relation of the Company or any
Subsidiary of the Company to cease doing business with the Company or such Subsidiary,
or in any way materially interfere with the relationship between any such customer,
supplier, licensee or business relation and the Company or any Subsidiary of the Company.
(c) If, at the time of enforcement of this Section 13, a court shall hold that the
duration, scope or area restrictions stated herein are unreasonable under circumstances then
existing, the parties agree that the maximum duration, scope or area reasonable under such
circumstances shall be substituted for the stated duration, scope or area and that the court
shall be allowed to revise the restrictions contained herein to cover the maximum period,
scope and area permitted by law.
(d) In the event of a breach or a threatened breach by the Optionee of any of the
provisions of this Section 13, the Company, in addition and supplementary to other rights
and remedies existing in its favor, may apply to any court of law or equity of competent
jurisdiction for specific performance and/or injunctive or other relief in order to enforce
or prevent any violations of the provisions hereof (without posting a bond or other
security).
14 Miscellaneous.
(a) Rights of the Optionee. Nothing in this Agreement shall interfere with or
limit in any way the right of the Company or any Subsidiary to terminate the Optionee's
employment at any time (with or without Cause), or to confer upon the Optionee any right
to continue in the employ of the Company or any Subsidiary for any period of time, or to
continue to receive the Optionee's current (or other) rate of compensation. Except as
otherwise provided herein, unless and until a certificate or certificates representing the
Option Shares shall have been issued to the Optionee, the Optionee shall not be a
securityholder or have any of the rights or privileges of a securityholder of the Company
with respect to shares of Common Stock acquired upon exercise of the Option.
(b) Severability. Whenever possible, each provision of this Agreement shall
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 shall not affect any other provision or any other jurisdiction, but this
Agreement shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
(c) Entire Agreement. Except as otherwise expressly set forth herein, this
Agreement embodies the complete agreement and understanding among the parties hereto
with respect to the subject matter hereof and supersedes and preempts 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.
(d) Successors and Assigns. Except as otherwise provided herein, this
Agreement shall bind and inure to the benefit of and be enforceable by the parties hereto
and their respective successors and assigns.
(e) Counterparts. This Agreement may be executed in separate counterparts
each of which shall be an original and all of which taken together shall constitute one and
the same agreement.
(f) Remedies. The parties hereto shall be entitled to enforce their 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 their 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 the Company and the Optionee may in its sole
discretion apply to any court of law or equity of competent jurisdiction for specific
performance and/or injunctive relief (without posting a bond or other security) in order to
enforce or prevent any violation of the provisions of this Agreement.
(g) Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in writing and
will be deemed to have been given when delivered personally, mailed by certified or
registered mail, return receipt requested and postage prepaid, or sent via a nationally
recognized overnight courier, or sent via facsimile to the recipient. Such notices, demands
and other communications will be sent to the address indicated below:
If to the Optionee:
___________________________
___________________________
___________________________
Facsimile No.: _____________
If to the Company, to:
▇'▇▇▇▇▇▇▇▇ Industries Holdings, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to (which shall not constitute notice to the Company):
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
Citigroup Center
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
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. The Company further agrees to provide the
Optionee with copies of all notices and other communications that the Company is required to
provide or otherwise provide to holders of its Common Stock in their capacity as such, whether
or not the Optionee actually holds any shares of Common Stock at the time any such notice is
given.
(h) Time of the Essence; Computation of Time. Time is of the essence for each
and every provision of this Agreement. Whenever the last day for the exercise of any
privilege or the discharge of any duty hereunder shall fall upon a Saturday, Sunday, or any
date on which banks in New York, New York are authorized to be closed, the party having
such privilege or duty may exercise such privilege or discharge such duty on the next
succeeding day which is a regular business day.
(i) Waiver of Jury Trial. Each of the parties hereto waives any right it may
have to trial by jury in respect of any litigation based on, arising out of, under or in
connection with this Agreement or any course of conduct, course of dealing, verbal or
written statement or action of any party hereto.
15 Governing Law. All questions concerning the construction, validity and
interpretation of this Agreement will be governed by and construed in accordance with the
domestic laws of the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of New York.
16 Descriptive Headings. The descriptive headings of this Agreement are inserted
for convenience only and do not constitute a part of this Agreement.
* * * * *
IN WITNESS WHEREOF, the Company and the Optionee have executed this
Common Stock ISO Agreement as of the date first above written.
▇'▇▇▇▇▇▇▇▇ INDUSTRIES HOLDINGS, INC.
By:
Address: ________________________
________________________