EXHIBIT 10.1
========================================================================
NOTICE OF GRANT OF MATTEL, INC.
PREMIUM PRICE STOCK ID: 95-1567322
OPTION AND TLSAR AND 333 Continental Boulevard
GRANT AGREEMENT El Segundo, CA
90245
25% PREMIUM
========================================================================
Recipient Name ID: xxx-xx-xxx
Recipient Address
Recipient City, State and Zip Code
You have been granted an Option to buy Mattel, Inc. Common Stock as
follows:
Non-Qualified Premium Price Stock Option Grant No. 00xxxx
Date of Grant 11/06/97
Start Date 12/31/97
Stock Option Plan 1997 Premium Price
Option Exercise Price per Share $42.31
Total Number of Option Shares Granted __________
Total Exercise Price of Option Shares Granted $__________
You have also been granted a Tandem Limited Stock Appreciation Right in
conjunction with the above Option.
Total Number of TLSAR Shares Granted __________
Exercise Price per Share of TLSAR $__________
- -------------------------------------------------------------------------
By signing your name below, you and Mattel, Inc. agree that (a)
this Option and related TLSAR are granted under and governed by
the terms and conditions of the Grant Agreement referenced above,
which is attached hereto and made a part of this document, and
(b) both of these documents are subject to the terms of the above
referenced 1997 Premium Price Stock Option Plan.
_________________________ _______-______-_______
Full Legal Name (print) Social Security Number
Current Address: _________________________________
_________________________________
- ------------------------------------------------------------------------
__________________________________ __________________________________
For MATTEL, INC. Date
__________________________________ __________________________________
Optionee Date
GRANT AGREEMENT FOR A
NON-QUALIFIED PREMIUM PRICE STOCK OPTION AND TLSAR
UNDER THE MATTEL 1997 PREMIUM PRICE STOCK OPTION PLAN
-----------------------------------------------------
This is a Grant Agreement between Mattel, Inc. (the "Company") and
the individual (the "Participant") named in the Notice of Grant of Premium
Price Stock Option and TLSAR (the "Notice") attached hereto as the cover
page of this agreement.
RECITALS
- --------
The Company has adopted the Mattel 1997 Premium Price Stock Option
Plan, as amended by the First Amendment to Mattel, Inc. Premium Price Stock
Option Plan (as amended, the "Plan"), to grant selected employees options
to purchase shares of Common Stock of the Company. In accordance with the
terms of the Plan, the Compensation/Options Committee of the Board of
Directors (the "Committee") has approved the execution of this Grant
Agreement (the "Grant") between the Company and the Participant.
Capitalized terms used herein without definition shall have the meanings
assigned to such terms in the Plan.
GRANT
- -----
The Company grants to the Participant the right and option to
purchase, on the terms and conditions hereinafter set forth, all or any
part of the aggregate number of Option shares set forth in the Notice
exercisable in accordance with the provisions of this Grant during a period
expiring FIVE years from December 31, 1997 (the "Start Date"), or on
December 31, 2002 (the "Expiration Date"), unless terminated prior to that
date pursuant to Section 1 or 5 below. This Option is a Non-Qualified
Stock Option.
The Company also grants to the Participant, in conjunction with the
Option granted hereby, a Tandem Limited Stock Appreciation Right ("TLSAR")
for the number of TLSAR shares set forth in the Notice, as described in
Section 11 of the Plan and Section 2 below.
1. OPTION
A. EXERCISABILITY (VESTING) OF OPTION. The Participant may
purchase the number of Option shares of Common Stock determined pursuant to
Section 1(B) below on or after November 6, 2000 (the third anniversary of
the Grant Date), provided that one of the following performance criteria
has been met on or before December 31, 1999.
I. STOCK PRICE. The Fair Market Value of Mattel Common Stock is
equal to or greater than the Exercise Price of the Option on at least
one Trading Day on or after February 27, 1998 and before December 31,
1999.
II. EARNINGS PER SHARE. The Earnings Per Share of Mattel Common
Stock for calendar year 1999 is equal to or greater than 132.25% of
the Earnings Per Share of Mattel Common Stock for calendar year 1997.
If there is a Change in Control and the Option has not previously been
forfeited, the Participant may exercise the Option at any time after either
of the performance criteria set forth above is met.
B. NUMBER OF OPTION SHARES EXERCISABLE. The Participant shall
have the following number of Option shares available for exercise, subject
to the requirements of Section 1(A) above:
i. CONTINUOUS EMPLOYMENT. If the Participant has been continuously
employed at Mattel through November 6, 2000, 100% of the Option shares
granted in this Notice.
ii. DEATH OR DISABILITY. If the Participant incurs a Severance on
account of death or Disability before December 31, 2000, 100% of the
Option shares granted in this Notice.
iii. RETIREMENT OR TERMINATION WITHOUT CAUSE. If the Participant
incurs a Severance on account of Retirement or Termination without
Cause before December 31, 2000, a pro-rated portion of the Option
shares granted in this Notice, based upon the number of full months of
employment with Mattel since the Grant Date to the earlier of the date
of Severance or November 6, 2000, divided by 36, and the remaining
Option shares granted in this Notice shall be forfeited.
iv. EARLY SEVERANCE FOR OTHER REASONS. If the Participant incurs a
Severance for any reason other than death, Disability, Retirement, or
Termination without Cause before November 6, 2000, then the Option
shall be forfeited in its entirety.
v. CHANGE IN CONTROL. If there is a Change in Control before November
6, 2000, and the Participant is employed at Mattel at the time of the
Change in Control, 100% of the Option shares granted in this Notice.
The number of Option shares which may be purchased upon exercise
under this Grant shall in each case be calculated to the nearest full
share.
C. TERM OF OPTION. The Option under this Grant shall expire on the
first to occur of the following dates:
i. The fifth anniversary of the Start Date, that is December 31,
2002, if the Participant remains in employment with the Company.
ii. December 31, 1999, if the Option has not become exercisable by
that date in accordance with Section 1(A) above.
iii. If the Participant incurs a Severance for reasons of death,
Disability, or Retirement, the fifth anniversary of the Start Date,
that is December 31, 2002.
iv. If the Participant incurs a Severance for reason of Termination
without Cause at a time when the Option was already exercisable, the
fifth anniversary of the Start Date, that is December 31, 2002.
v. If the Participant incurs a Severance for reason of Termination
without Cause at a time before the Option was exercisable, a date
which is ninety (90) days after the date when the Option first becomes
exercisable.
vi. If the Participant incurs a Severance for reasons other than
death, Disability, Retirement, or Termination without Cause at a time
when the Option was already exercisable, a date which is ninety (90)
days after the date of Severance.
vii. If the Participant incurs a Severance for reasons other than
death, Disability, Retirement, or Termination without Cause at a time
before the Option was exercisable, the date of Severance.
All or a proportionate part of this Option shall also be cancelled if the
Participant exercises all or a portion of the TLSAR as provided in Section
2 of this Grant or if the Participant does not comply with the conditions
set forth in Section 12.4 of the Plan.
2. Tandem Limited Stock Appreciation Rights.
A. EXERCISABILITY (VESTING) OF TLSAR. The Participant may exercise
all or a portion of the TLSAR for a 60 day period commencing on the date a
Change in Control of Mattel occurs.
B. NUMBER OF TLSAR SHARES EXERCISABLE. The number of TLSAR shares
available for exercise shall be calculated in the same manner as provided
for Option shares in Section 1(B) above.
C. TERM OF TLSAR. The TLSAR under this Grant shall expire on the
first to occur of the following dates:
(i) The date of expiration of the related Option, as specified in
Section 1(C) above, unless the TLSAR is exercisable on such date.
(ii) 60 days after a Change in Control occurs.
All or a proportionate part of the TLSAR shall also be cancelled if the
Participant exercises all or a portion of the Option as provided in Section
1 of this Grant or if the Participant does not comply with the conditions
set forth in Section 12.4 of the Plan.
3. METHOD OF EXERCISING OPTION OR TLSAR. Each exercise under
this Grant shall be by means of a written notice of exercise delivered to
the office of the Secretary of the Company, specifying the number of whole
shares for which the Option or TLSAR is being exercised, accompanied upon
exercise of the Option by payment of the full purchase price of the shares
to be purchased. The payment shall be in the form of cash or such other
forms of consideration as the Committee shall deem acceptable, such as the
surrender of outstanding shares of Common Stock owned by the Participant or
by withholding shares that would otherwise be issued upon the exercise
under this Grant. The Participant may exercise the Option by the delivery
to the Company or its designated agent of an irrevocable written notice of
exercise form together with irrevocable instructions to the broker-dealer
to sell or margin a sufficient portion of the shares of Common Stock and to
deliver the sale or margin loan proceeds directly to the Company to pay the
exercise price of the Option. If the Participant's employment is
terminated by reason of death, the heirs of the Participant will be able to
exercise this Grant (if and when exercisable) until the date on which this
Grant would otherwise expire.
4. WITHHOLDING. Upon any exercise of this Grant, the
Participant shall pay, or make provisions satisfactory to the Company or
its Subsidiary for payment of, any federal, state and local taxes required
to be withheld.
5. CANCELLATION OF GRANTS. Participant specifically
acknowledges that this Grant is subject to the provisions of Section 12.4
of the Plan, entitled "Cancellation of Grants," which can cause the
forfeiture of this Grant, or the rescission of Common Stock or payment of
cash acquired upon exercise under this Grant. As a condition of exercise
under this Grant, the Participant shall certify on a form acceptable to the
Committee that he or she is in compliance with the terms and conditions of
the Plan, including Section 12.4 thereof, entitled "Cancellation of
Grants."
6. COMPLIANCE WITH LAW. No shares issuable upon the exercise of
this Option or TLSAR shall be issued and delivered unless and until all
applicable registration requirements of the Securities Act of 1933, all
applicable listing requirements of any national securities exchange on
which the Common Stock is then listed, and all other requirements of law or
of any regulatory bodies having jurisdiction over such issuance and
delivery shall have been complied with. In particular, the Committee may
require certain investment (or other) representations and undertakings in
connection with the issuance of securities in connection with the Plan in
order to comply with applicable law.
7. ASSIGNABILITY. Except as may be effected by will or by the
laws of descent and distribution, any attempt to assign this Option or
TLSAR shall be of no effect.
8. CERTAIN CORPORATION TRANSACTIONS. In the event of any change
or reclassification of shares, recapitalization, merger, or similar event,
the Committee may adjust proportionately the number of shares and the
Exercise Price of the Option and TLSAR subject to this Grant. In the event
of any other change affecting the Common Stock or any distribution (other
than normal cash dividends) to holders of Common Stock, the Committee may
make such adjustments as it may deem equitable (including adjustments to
avoid fractional shares) in order to give proper effect to such event. In
the event of a corporate merger, consolidation, acquisition of property or
stock, spin-off, reorganization or liquidation, the Committee may
substitute a new Grant for this Grant or provide for the assumption of this
Grant by the other corporation that is a party to the transaction.
9. NO ADDITIONAL RIGHTS. Neither the Grant of this Option and
TLSAR nor its exercise shall (a) confer upon the Participant any right to
continue in the employ of the Company or a Subsidiary, (b) interfere in any
way with the rights of the Company or a Subsidiary to terminate such
employment at any time for any reason, with or without cause, or (c)
interfere with the right of the Company or a Subsidiary to undertake any
lawful corporate action. Participant acknowledges that he or she is an
"employee at will." The provisions of this Section 9 are subject to the
terms of any employment agreement between the Participant and the Company
(or a Subsidiary).
10. RIGHTS AS A STOCKHOLDER. Neither the Participant nor any
other person legally entitled to exercise this Option and TLSAR shall be
entitled to any of the rights or privileges of a stockholder of the Company
in respect of any shares issuable upon any exercise of this Option and/or
TLSAR unless and until a certificate or certificates representing such
shares shall have been actually issued and delivered to the Participant.
11. COMPLIANCE WITH PLAN. This Grant is subject to, and the
Company and Participant agree to be bound by, all of the terms and
conditions of the Plan as it shall be amended from time-to-time. No
amendment to the Plan shall adversely affect this Grant without the consent
of the Participant. In the case of a conflict between the terms of the
Plan and this Grant, the terms of the Plan shall govern.
12. GOVERNING LAW. This Grant has been granted, executed and
delivered with effect from the date of Notice, at El Segundo, California,
and interpretation, performance and enforcement of this Grant shall be
governed by the laws of the State of Delaware.