STOCK OPTION AGREEMENT
UNDER
1999 STOCK OPTION PLAN FOR OUTSIDE CONSULTANTS
OF
ADAMS GOLF, INC.
STOCK OPTION AGREEMENT (this "Agreement") entered into this
____ day of ___________, ____, between ADAMS GOLF, INC., a
Delaware corporation (the "Corporation"), and
________________________________, an Eligible Person (as that
term is defined by the Corporation's 1999 Stock Option Plan for
Outside Consultants (the "Plan")) (the "Optionee," which term as
used herein shall be deemed to include any successor to the
Optionee by will or by the laws of descent and distribution,
unless the context shall otherwise require, as provided in the
Plan).
Pursuant to the Plan, the Administering Body approved the
issuance to the Optionee, effective as of the date set forth
above, of a Non-qualified Stock Option to purchase up to an
aggregate of ____________ shares of common stock, par value
$.001, of the Corporation (the "Common Stock"), at the price of
$____ per share (the "Option Price") which represents not less
than 100% of the Fair Market Value of a share of Common Stock
determined in accordance with the Plan, upon the terms and
conditions hereinafter set forth. (Capitalized terms used herein
but not defined herein shall have the meaning ascribed to them in
the Plan).
NOW, THEREFORE, in consideration of the mutual premises and
undertakings hereinafter set forth, the parties hereto agree as
follows:
1. Option; Option Price. On behalf of the Corporation, the
Administering Body hereby grants as of the date of this Agreement
to the Optionee the option (the "Option") to purchase, subject to
the terms and conditions of this Agreement and the provisions of
the Plan (which is incorporated by reference herein and which in
all cases shall control in the event of any conflict with the
terms, definitions and provisions of this Agreement),
_______________ shares of Common Stock of the Corporation at an
exercise price per share equal to the Option Price. A copy of
the Plan as in effect on the date hereof has been supplied to the
Optionee, and the Optionee by executing this Agreement hereby
acknowledges receipt thereof.
2. Term. The term (the "Option Term") of the Option shall
commence on the date of this Agreement and shall terminate on the
______ anniversary of the date of this Agreement, unless such
Option shall theretofore have been terminated in accordance with
the terms hereof or the provisions of the Plan.
3. Vesting; Restrictions on Exercise.
(a) Subject to the provisions of Sections 5 and 8 hereof, and
unless accelerated, as set forth in the Plan or as provided
herein, the Option granted hereunder shall vest and become
exercisable for the number of shares set forth opposite the dates
noted below (the "Option Vesting Schedule").
Cumulative
Date(s) Number of Vested Shares
(b) If the Corporation shall consummate any merger,
consolidation or other reorganization not involving a Change in
Control (a "Reorganization") in which holders of shares of Common
Stock are entitled to receive in respect of such shares any
securities, cash or other consideration (including, without
limitation, a different number of shares of Common Stock), the
Option shall thereafter be exercisable, in accordance with the
Plan and this Agreement, only for the kind and amount of
securities, cash and/or other consideration receivable upon such
Reorganization by a holder of the same number of shares of Common
Stock as are subject to the Option immediately prior to such
Reorganization, and any adjustments will be made to the terms of
the Option in the sole discretion of the Administering Body as it
may deem appropriate to give effect to the Reorganization.
(c) Subject to the provisions of Sections 5 and 8 hereof, shares
as to which the Option becomes exercisable pursuant to the
foregoing provisions may be purchased at any time thereafter
prior to the expiration or termination of the Option.
4. Termination of Option.
(a) The unexercised portion of the Option shall automatically
and without notice terminate and become null and void at the time
of the earliest to occur of:
(i) six (6) months after the Optionee's engagement with the
Corporation is terminated as a result of death or Permanent
Disability;
(ii) sixty (60) days after the Optionee's engagement with the
Corporation is terminated for any reason other than death or
Permanent Disability;
(iii) the expiration date of the term of the Option; or
5. Procedure for Exercise.
(a) Subject to the requirements of Section 8, the Option may be
exercised, from time to time, in whole or in part (but for the
purchase of a whole number of shares only), by delivery of a
written notice, a form of which has been attached as Annex A
hereto (the "Notice"), from the Optionee to the Secretary of the
Corporation, which Notice shall:
(i) state that the Optionee elects to exercise the Option;
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(ii) state the number of vested shares with respect to which the
Option is being exercised (the "Optioned Shares");
(iii) state the date upon which the Optionee desires to
consummate the purchase of the Optioned Shares (which date must
be prior to the termination of such Option and no later than
thirty (30) days after the date of receipt of such Notice);
(iv) include any representations of the Optionee required under
Section 8(c); and
(v) if the Option shall be exercised pursuant to Section 9 by
any person other than the Optionee, include evidence to the
satisfaction of the Administering Body of the right of such
person to exercise the Option.
(b) Payment of the Option Price for the Optioned Shares shall be
made in U.S. dollars by personal check, bank draft or money order
payable to the order of the Corporation or by wire transfer.
(c) The Corporation shall issue a stock certificate in the name
of the Optionee (or such other person exercising the Option in
accordance with the provisions of Section 9) for the Optioned
Shares as soon as practicable after receipt of the Notice and
payment of the aggregate Option Price for such shares.
6. No Rights as a Stockholder. The Optionee shall have no
rights as a stockholder of the Corporation with respect to any
Optioned Shares until the date the Optionee or his nominee
(which, for purposes of this Agreement, shall include any third
party agent selected by the Administering Body to hold such
Option Shares on behalf of the Optionee), guardian or legal
representative is the holder of record of such Optioned Shares.
7. Adjustments.
(a) If at any time while the Option is outstanding, (1) there
shall be any increase or decrease in the number of issued and
outstanding shares of Common Stock through the declaration of a
stock dividend, stock split, combination of shares or through any
recapitalization resulting in a stock split-up, spin-off,
combination or exchange of shares of Common Stock or (2) the
value of the outstanding shares of Common Stock is reduced by
reason of an extraordinary cash dividend, then and in each such
event appropriate adjustment shall be made in the number of
shares and the exercise price per share covered by the Option, so
that the same proportion of the Corporation's issued and
outstanding shares of Common Stock shall remain subject to
purchase at the same aggregate exercise price.
(b) Except as otherwise expressly provided herein, the issuance
by the Corporation of shares of its capital stock of any class,
or securities convertible into shares of capital stock of any
class, either in connection with a direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Corporation
convertible into such shares
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or other securities, shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number of or
exercise price of shares of Common Stock covered by the Option.
(c) Without limiting the generality of the foregoing, the
existence of the Option shall not affect in any manner the right
or power of the Corporation to make, authorize or consummate (i)
any or all adjustments, recapitalizations, reorganizations or
other changes in the Corporation's capital structure or its
business; (ii) any merger or consolidation of the Corporation;
(iii) any issue by the Corporation of debt securities, or
preferred or preference stock that would rank above the shares of
Common Stock covered by the Option; (iv) the dissolution or
liquidation of the Corporation; (v) any sale, transfer or
assignment of all or any part of the assets or business of the
Corporation; or (vi) any other corporate act or proceeding,
whether of a similar character or otherwise.
8. Additional Provisions Related to Exercise.
(a) The Option shall be exercisable only in accordance with this
Agreement and the terms of the Plan, including the provisions
regarding the period when the Option may be exercised and the
number of shares of Common Stock that may be acquired upon
exercise.
(b) The Option may not be exercised as to less than one hundred
(100) shares of Common Stock at any one time unless less than one
hundred (100) shares of Common Stock remain to be purchased upon
the exercise of the Option.
(c) To exercise the Option, the Optionee shall follow the
provisions of Section 5 hereof. Upon the exercise of the Option
at a time when there is not in effect a registration statement
under the Securities Act of 1933, as amended (the "Securities
Act") relating to the shares of Common Stock issuable upon
exercise of the Option, the Administering Body in its discretion
may, as a condition to the exercise of the Option, require the
Optionee (i) to represent in writing that the shares of Common
Stock received upon exercise of the Option are being acquired for
investment and not with a view to distribution and (ii) to make
such other representations and warranties as are deemed
appropriate by counsel to the Corporation. No Option may be
exercised and no shares of Common Stock shall be issued and
delivered upon the exercise of the Option unless and until the
Corporation and/or the Optionee shall have complied with all
applicable federal or state registration, listing and/or
qualification requirements and all other requirements of law or
of any regulatory agencies having jurisdiction.
(d) Stock certificates representing shares of Common Stock
acquired upon the exercise of the Option that have not been
registered under the Securities Act shall, if required by the
Administering Body, bear an appropriate legend which may, at the
discretion of the Administering Body, take the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
UNDER THE ACT OR PURSUANT TO AN EXEMPTION FROM
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REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO
THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED."
(e) The exercise of each Option and the issuance of shares in
connection with the exercise of an Option shall, in all cases, be
subject to each of the following conditions: (i) compliance with
the terms of the Plan and this Agreement, (ii) the satisfaction
of withholding tax or other withholding liabilities, (iii) as
necessary, the listing, registration or qualification of any to-
be-issued shares upon any securities exchange, The Nasdaq Stock
Market or other trading or quotation system or under any federal
or state law and (iv) the consent or approval of any regulatory
body. The Administering Body shall in its sole discretion
determine whether one or more of these conditions is necessary or
desirable to be satisfied in connection with the exercise of an
Option and prior to the delivery or purchase of shares pursuant
to the exercise of an Option. The exercise of an Option shall
not be effective unless and until such condition(s) shall have
been satisfied or the Administering Body shall have waived such
conditions, in its sole discretion.
9. Restriction on Transfer. The Option may not be assigned or
transferred except by will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order
as defined in the IRC, and may be exercised during the lifetime
of the Optionee only by the Optionee or the Optionee's guardian
or legal representative or assignee pursuant to a qualified
domestic relations order. If the Optionee dies, the Option shall
thereafter be exercisable, during the period specified in Section
4(a)(i), by his executors or administrators or by a person who
acquired the right to exercise such Option by bequest or
inheritance to the full extent to which the Option was
exercisable by the Optionee at the time of his death. If the
Optionee becomes inflicted with a Permanent Disability, the
Option shall thereafter be exercisable, during the period
specified in Section 4(a)(i), by his legal representatives to the
full extent to which the Option was exercisable by the Optionee
at the time of his Permanent Disability. The Option shall not be
subject to execution, attachment or similar process. Any
attempted assignment or transfer of the Option contrary to the
provisions hereof, and the levy of any execution, attachment or
similar process upon the Option, shall be null and void and
without effect.
10. Notices. All notices or other communications which are
required or permitted hereunder shall be in writing and
sufficient if (i) personally delivered, (ii) sent by nationally-
recognized overnight courier or (iii) sent by registered or
certified mail, postage prepaid, return receipt requested,
addressed as follows:
if to the Optionee, to the address set forth on the
signature page hereto; and
if to the Corporation, to:
Adams Golf, Inc.
300 Delaware Avenue, Suite 572
Wilmington, Delaware 19801
Attention: Secretary
with a copy to:
Adams Golf, Ltd.
c/o Adams Golf GP Corp.
2801 E. Plano Parkway
Plano, Texas 75074
Attention: President
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or to such other address as the party to whom notice is to be
given may have furnished to each other party in writing in
accordance herewith. Any such communication shall be deemed to
have been given (i) when delivered, if personally delivered, (ii)
on the first Business Day (as hereinafter defined) after
dispatch, if sent by nationally-recognized overnight courier and
(iii) on the third Business Day following the date on which the
piece of mail containing such communication is posted, if sent by
mail. As used herein, "Business Day" means a day that is not a
Saturday, Sunday or a day on which banking institutions in the
city to which the notice or communication is to be sent are not
required to be open.
11. No Waiver. No waiver of any breach or condition of this
Agreement shall be deemed to be a waiver of any other or
subsequent breach or condition, whether of like or different
nature.
12. Optionee Undertaking. The Optionee hereby agrees to take
whatever additional actions and execute whatever additional
documents the Corporation or its counsel may in their reasonable
judgment deem necessary or advisable in order to carry out or
effect one or more of the obligations or restrictions imposed on
the Optionee pursuant to the express provisions of this
Agreement.
13. Modification of Rights. The rights of the Optionee are
subject to modification and termination in certain events as
provided in this Agreement and the Plan.
14. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware
applicable to contracts made and to be wholly performed therein.
15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original,
but all of which together shall constitute one and the same
instrument.
16. Entire Agreement. This Agreement and the Plan constitute
the entire agreement between the parties with respect to the
subject matter hereof, and supersede all previously written or
oral negotiations, commitments, representations and agreements
with respect thereto.
ADAMS GOLF, INC.
By:________________________________
Name:______________________________
Title:_____________________________
OPTIONEE:
__________________________________
Name:_____________________________
Address:__________________________
__________________________
__________________________
Annexes
Annex A - Form of Exercise Notice
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ANNEX A
EXERCISE NOTICE
Ladies/Gentlemen:
I hereby exercise my Stock Option to purchase _________ shares of
Common Stock of ADAMS GOLF, INC. at the option price of $____ per
share as provided in the Stock Option Agreement dated the ___ day
of ________________.
I acknowledge that I previously received a copy of the 1999 Stock
Option Plan for Outside Consultants of Adams Golf, Inc. and
executed a Stock Option Agreement, and I have carefully reviewed
both documents.
I have considered the tax implications of my option and the
exercise thereof. I hereby tender my personal check, bank draft
or money order payable to ADAMS GOLF, INC. in the amount of
$____________ or, I have wire transferred $_______________ to
ADAMS GOLF, INC., which transfer shall be subject to the
confirmation of receipt of funds by the Corporation. [If payment
is to be made by wire transfer, the Optionee should contact the
Corporation's Chief Financial Officer or Controller in advance to
obtain wiring instructions.]
______________________________
Optionee
______________________________
Date