Exhibit 10.3
SCHOOL SPECIALTY, INC.
2008 EQUITY INCENTIVE PLAN
STOCK OPTION AGREEMENT
School Specialty, Inc. (the “Company”) has granted you an option (the “Option”) under its 2008 Equity Incentive Plan (the “Plan”). The Option lets you purchase a specified number of shares of the Common Stock (the “Option Shares”), at a specified price per share (the “Exercise Price”).
Schedule I to this Agreement provides the details for your grant. It specifies the number of Option Shares, the Exercise Price, the Date of Grant, the latest date the Option will expire (the “Term Expiration Date”), and any special rules that apply to your Option. Schedule Ialso specifies that the Company intends this Option to be a nonqualified stock option (“NQSO”), not subject to the rules contained in Code Section 422.
The Option is subject in all respects to the applicable provisions of the Plan. This Agreement does not cover all of the rules that apply to the Option under the Plan, and the Plan defines any terms in this Agreement that the Agreement does not define.
In addition to the terms and restrictions in the Plan, the following terms and restrictions apply to each Option:
Option
While your Option remains in effect under theExpirationsection below,
Exercisability
you may exercise any exercisable portions of that Option (and buy the Option Shares) under the timing rulesSchedule I specifies under “Option Exercisability Provisions.”
Method of
Subject to this Agreement and the Plan, you may exercise the Option only
Exercise and
by providing a written notice (or notice through another previously
Payment for
approved method, which could include a voice- or e-mail system) to
Shares
the Assistant Secretary of the Company or to whomever the Administrator designates, on or before the date the Option expires. Each such notice must satisfy whatever procedures then apply to the Option and must contain such representations (statements from you about your situation) as the Company requires. You must, at the same time, pay the Exercise Price using one or more of the methods described below. Please note that until the Company notifies you otherwise, or unless you indicate otherwise on your notice of option exercise, all exercises of the Option will be done or a “Net Exercise” basis, which is the preferred method under the Plan.
Net Exercise
The Company delivers the number of shares to you that equals the number of Option Shares for which the Option was exercised, reduced by the number of whole shares of common stock with a Fair Market Value on the date of exercise equal to the Exercise Price and the minimum tax withholding required by law; to the extent the combined value of the whole shares of common stock, valued at their Fair Market Value on the date of exercise, is not sufficient to equal the Exercise Price and minimum tax withholding obligation, the Company will withhold the additional amount from your next pay check, or if you are not employed by the Company, you must pay the additional amount in cash to the Company before delivery of the shares will be made to you;
Cashless
an approved cashless exercise method, including directing
Exercise
the Company to send the stock certificates (or other acceptable evidence of ownership) to be issued under the Option to a licensed broker acceptable to the Company as your agent in exchange for the broker’s tendering to the Company cash (or acceptable cash equivalents) equal to the Exercise Price and any required tax withholdings (at the minimum required level); or
Cash/Check
cash, a cashier’s or certified check in the amount of the Exercise Price, and any required tax withholdings, payable to the order of the Company.
Expiration
You cannot exercise the Option after it has expired. The Option will expire no later than the close of business on the Term Expiration Date shown onSchedule I. The “Option Expiration Rules” inSchedule Iprovide the circumstances under which the Option will terminate before the Term Expiration Date because of, for example, your termination of employment. The Administrator can override the expiration provisions ofSchedule I.
Compliance
You may not exercise the Option if the Company’s issuing stock upon
with Law
such exercise would violate any applicable federal or state securities laws or other laws or regulations. You may not sell or otherwise dispose of the Option Shares in violation of applicable law. As part of this prohibition, you may not use the Cashless Exercise method if the Company’s insider trading policy then prohibits you from selling to the market.
Additional
The Company may postpone issuing and delivering any Option Shares
Conditions
for so long as the Company determines to be advisable to satisfy the
to Exercise
following:
its completing or amending any securities registration or qualification of the Option Sharesor its or your satisfying any exemption from registration under any Federal or state law, rule, or regulation;
its receiving proof it considers satisfactory that a person seeking to exercise the Option after your death or Disability (as defined inSchedule I) is authorized and entitled to do so;
your complying with any requests for representations under the Plan; and
your complying with any federal or state tax withholding obligations.
Additional
If you exercise the Option at a time when the Company does not have a
Representations
currentregistration statement (generally on Form S-8) under the
from You
Securities Act of 1933 (the “Act”) that covers issuances of shares to you, you must comply with the following before the Company will issue the Option Shares to you. You must —
represent to the Company, in a manner satisfactory to the Company’s counsel, that you are acquiring the Option Shares for your own account and not with a view to reselling or distributing the Option Shares; and
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agree that you will not sell, transfer, or otherwise dispose of the Option Shares unless:
a registration statement under the Act is effective at the time of disposition with respect to the Option Shares you propose to sell, transfer, or otherwise dispose of; or
the Company has received an opinion of counsel or other information and representations it considers satisfactory to the effect that, because of Rule 144 under the Act or otherwise, no registration under the Act is required.
No Effect on
Nothing in this Agreement restricts the Company’s rights or those of any
Employment
of its affiliates to terminate your employment or other relationship at any
or Other
time, with or without cause. The termination of employment or other
Relationship
relationship, whether by the Company or any of its affiliates or otherwise, and regardless of the reason for such termination, has the consequences provided for under the Plan and any applicable employment or severance agreement or plan.
Not a Shareholder
You understand and agree that the Company will not consider you a shareholder for any purpose with respect to any of the Option Shares until you have exercised the Option, paid for the shares, and received evidence of ownership.
Adjustments
Any adjustments made pursuant to Section 15 of the Plan shall be made in such a manner as to ensure that, after such adjustment, the Option either continues not to be subject to Code Section 409A or complies with the requirements of Code Section 409A and the Committee shall not have the authority to make any adjustments pursuant to Section 15 of the Plan to the extent that the existence of such authority would cause the Option to be subject to Code Section 409A.
Governing Law
The laws of the State of Wisconsin will govern all matters relating to this
Agreement, without regard to the principles of conflict of laws, except to the extent superseded by the laws of the United States of America.
Notices
Any notice you give to the Company must follow the procedures then in effect. If no other procedures apply, you must deliver your notice in writing by hand or by mail to the office of the Corporate Assistant Secretary. If mailed, you should address it to the Company’s Corporate Assistant Secretary at the Company’s then corporate headquarters, unless the Company directs optionees to send notices to another corporate department or to a third party administrator or specifies another method of transmitting notice. The Company will address any notices to you at your office or home address as reflected on the Company’s personnel or other business records. You and the Company may change the address for notice by like notice to the other, and the Company can also change the address for notice by general announcements to optionees.
Plan Governs
Wherever a conflict may arise between the terms of this Agreement and the terms of the Plan, the terms of the Plan will control.
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SCHOOL SPECIALTY, INC.
OPTIONEE ACKNOWLEDGMENT
I acknowledge that I have received a copy of the Plan. I represent that I have read and am familiar with the Plan’s terms. By signing where indicated onSchedule I, I accept the Option subject to all of the terms and provisions of this Agreement and the Plan, as the Plan may be amended in accordance with its terms. I agree to accept as binding, conclusive, and final all decisions or interpretations of the Administrator concerning any questions arising under the Plan with respect to the Option.
NO ONE MAY SELL, TRANSFER, OR DISTRIBUTE THE OPTION OR THE SECURITIES THAT MAY BE PURCHASED UPON EXERCISE OF THE OPTION WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATING THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO SCHOOL SPECIALTY, INC. OR OTHER INFORMATION AND REPRESENTATIONS SATISFACTORY TO SCHOOL SPECIALTY, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
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Grant No. 1153
SCHOOL SPECIALTY, INC.
2008 EQUITY INCENTIVE PLAN STOCK OPTION AGREEMENT
Schedule I
Optionee Information:
Name:
Michael P. Lavelle
Option Information:
Option Shares: 250,000
Exercise Price per Share: $2.26
Date of Grant: January 12, 2012
Term Expiration Date: January 12, 2022
Type of Option: NQSO
