EXHIBIT 10.1
NABISCO GROUP HOLDINGS CORP.
1990 LONG TERM INCENTIVE PLAN
STOCK OPTION AGREEMENT
----------------------
DATE OF GRANT: JULY 14, 1999
W I T N E S S E T H
1. GRANT OF OPTION. Pursuant to the provisions of the 1990 Long Term
Incentive Plan (the "Plan"), Nabisco Group Holdings Corp. on the above date
has granted to
((NAME))(THE "OPTIONEE"),
subject to the terms and conditions which follow and the terms and conditions
of the Plan, the right and option to exercise from the Company a total of
((STOCK_OPTIONS)) SHARES
of Common Stock of the Company, at the exercise price of $20.125 per share
(the "Option"). A copy of the Plan is attached and made a part of this
agreement with the same effect as if set forth in the agreement itself. All
capitalized terms used herein shall have the meaning set forth in the Plan,
unless the context requires a different meaning. The "Company" shall refer to
Nabisco Group Holdings Corp. and, if the context so requires, may refer to
Nabisco, Inc.
2. EXERCISE OF OPTION.
(a) Shares may be purchased by giving the Corporate Secretary of
the Company written notice of exercise, on a form prescribed by the Company,
specifying the number of shares to be purchased. The notice of exercise shall
be accompanied by
(i) tender to the Company of cash for the full purchase price of
the shares with respect to which such Option or portion thereof
is exercised; OR
(ii) the unsecured, demand borrowing by the Optionee from the
Company on an open account maintained solely for this purpose
in the amount of the full exercise price together with the
instruction from the Optionee to sell the shares exercised on
the open market through a duly registered broker-dealer with
which the Company makes an arrangement for the sale of such
shares under the Plan. This method is known as the "broker-dealer
exercise method" and is subject to the terms and conditions set forth
herein, in the Plan and in guidelines established by the Committee.
The Option shall be deemed to be exercised simultaneously with the
sale of the shares by the broker-dealer. If the shares purchased upon
the exercise of an Option or a portion thereof cannot be sold for a
price equal to or greater than the full exercise price plus direct
costs of the sales, then there is no exercise of the Option. Election
of this method authorizes the Company to deliver shares to the
broker-dealer and authorizes the broker-dealer to sell said shares on
the open market. The broker-dealer will remit proceeds of the sale to
the Company which will remit net proceeds to the Optionee after
repayment of the borrowing, deduction of costs, if any, and
withholding of taxes. The Optionee's borrowing from the Company on
an open account shall be a personal obligation of the Optionee which
shall bear interest at the published Applicable Federal Rate (AFR) for
short-term loans and shall be payable upon demand by the Company. Such
borrowing may be authorized by telephone or other telecommunications
acceptable to the Company. Upon such borrowing and the exercise of the
Option or portion thereof, title to the shares shall pass to the
Optionee whose election hereunder shall constitute instruction to the
Company to register the shares in the name of the broker-dealer or its
nominee. The Company reserves the right to discontinue this
broker-dealer exercise method at any time for any reason whatsoever.
The Optionee agrees that if this broker-dealer exercise method under
this paragraph is used, the Optionee promises unconditionally to pay
the Company the full balance in his open account at any time upon
demand. Optionee also agrees to pay interest on the account balance at
the AFR for short-term loans from and after demand.
(b) This Option shall be exercisable in three installments. The
first installment shall be exercisable on the first anniversary following the
Date of Grant for 33% of the number of shares of Common Stock subject to this
Option. Thereafter, on each subsequent anniversary date an installment shall
become exercisable for 33% and 34%, respectively, of the number of shares
subject to this Option until the Option has become fully exercisable. To the
extent that any of the above installments is not exercised when it becomes
exercisable, it shall not expire, but shall continue to be exercisable at any
time thereafter until this Option shall terminate, expire or be surrendered.
An exercise shall be for whole shares only.
3. TERMINATION OF EMPLOYMENT
(a) Unless otherwise provided in a written employment or
termination agreement between the Optionee and the Company, the Option shall
not become exercisable as to any additional shares following the Termination
of Employment of the Optionee for any reason including a Termination of
Employment because of Permanent Disability or Retirement of the Optionee.
Notwithstanding the foregoing, in the event of Termination
2
of Employment because of death, the Option shall immediately become
exercisable as to all shares.
(b) "Termination of Employment" as used herein means termination
from active employment with Nabisco, Inc. or any of its subsidiaries or
affiliates (including the Company); it does not mean termination of payment
of severance or benefits at the end of salary continuation or other form of
severance or pay in lieu of salary.
4. EXPIRATION OF OPTION. The Option shall expire or terminate and may
not be exercised to any extent by the Optionee after the first to occur of
the following events:
(a) The tenth anniversary of the Date of Grant, or such earlier
time as the Company may determine is necessary or appropriate in light of
applicable foreign tax laws; or
(b) The first anniversary of the date of the Optionee's Termination
of Employment for any reason other than the Optionee's Death, Permanent
Disability, Retirement or involuntary Termination of Employment by the
Company without Cause (as defined in Section 11 herein); or
(c) Immediately upon the Optionee's Termination of Employment for
Cause (as defined in Section 11 herein).
5. TRANSFERABILITY. Other than as specifically provided with regard to
the death of the Optionee, this Option agreement and any benefit provided or
accruing hereunder shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge; and
any attempt to do so shall be void. No such benefit shall, prior to receipt
thereof by the Optionee, be in any manner liable for or subject to the debts,
contracts, liabilities, engagements or torts of the Optionee.
6. NO RIGHT TO EMPLOYMENT. Neither the execution and delivery of this
agreement nor the granting of the Option evidenced by this agreement shall
constitute or be evidence of any agreement or understanding, express or
implied, on the part of the Company or its subsidiaries to employ the
Optionee for any specific period or shall prevent the Company or its
subsidiaries from terminating the Optionee's employment at any time with or
without "Cause" (as defined in Section 11 herein).
7. ADJUSTMENTS IN OPTION. In the event that the outstanding shares of
the Common Stock subject to the Option are, from time to time, changed into
or exchanged for a different number or kind of shares of the Company or other
securities by reason of a merger, consolidation, recapitalization,
reclassification, stock split, stock dividend, combination of shares, or
otherwise, the Committee shall make an appropriate and equitable adjustment
in the number and kind of shares or other consideration as to which the
Option, or portions thereof then unexercised, shall be exercisable. Any
adjustment
3
made by the Committee shall be final and binding upon the Optionee, the
Company and all other interested persons.
8. APPLICATION OF LAWS. The granting and the exercise of this Option and
the obligations of the Company to sell and deliver shares hereunder and to
remit cash under the broker-dealer exercise method shall be subject to all
applicable laws, rules, and regulations and to such approvals of any
governmental agencies as may be required.
9. TAXES. Any taxes required by federal, state or local laws to be
withheld by the Company upon exercise by the Optionee of the Option for
Common Stock, shall be paid to the Company before delivery of the Common
Stock is made to the Optionee. When the Option is exercised under the
broker-dealer exercise method, the full amount of any taxes required to be
withheld by the Company on exercise of stock options shall be deducted by the
Company from the proceeds.
10. NOTICES. Any notices required to be given hereunder to the Company
shall be addressed to The Secretary, Nabisco Group Holdings Corp., 7 Campus
Drive, Parsippany, NJ 07054, and any notice required to be given hereunder to
the Optionee shall be sent to the Optionee's address as shown on the records
of the Company.
11. TERMINATION FOR "CAUSE." For purposes of this Agreement, if the
Optionee has an employment or severance agreement with the Company or a
subsidiary, the Optionee's employment shall be deemed to have been terminated
for "Cause" only as such term is defined in the Optionee's employment or
severance agreement.
For purposes of this Agreement, if the Optionee does not have an
employment or severance agreement which defines the term "Cause", the
Optionee's employment shall be deemed to have been terminated for "Cause" if
the termination results from the Optionee's: (a) criminal conduct, (b)
deliberate continual refusal to perform employment duties on substantially a
full time basis, (c) deliberate and continual refusal to act in accordance
with any specific lawful instructions of an authorized officer or employee
more senior than the Optionee, or (d) deliberate misconduct which could be
materially damaging to the Company or any of its business operations without
a reasonable good faith belief by the Optionee that such conduct was in the
best interests of the Company. A termination of the Optionee's employment
shall not be deemed for Cause hereunder unless the senior personnel
executive of the Company shall confirm that any such termination is for
Cause as defined hereunder.
Any voluntary termination by the Optionee in anticipation of an
involuntary termination of the Optionee's employment for Cause shall be
deemed to be termination of Optionee's employment for Cause.
12. ADMINISTRATION AND INTERPRETATION. In consideration of the grant,
the Optionee specifically agrees that the Committee shall have the exclusive
power to interpret the
4
Plan and this Agreement and to adopt such rules for the administration,
interpretation and application of the Plan and Agreement as are consistent
therewith and to interpret or revoke any such rules. All actions taken and
all interpretations and determinations made by the Committee shall be final,
conclusive, and binding upon the Optionee, the Company and all other
interested persons. No member of the Committee shall be personally liable for
any action, determination or interpretation made in good faith with respect
to the Plan or the Agreement. The Committee may delegate its interpretive
authority to an officer or officers of the Company.
13. NON-COMPETITION
In consideration for the Option, Optionee agrees that:
(a) For the twelve (12) month period commencing on the date of
Optionee's Termination of Employment, Optionee shall not engage in
Competitive Employment. As used herein, "Competitive Employment" means
providing any person, company or other entity with any services, whether as a
consultant, employee, investor or otherwise, regarding any business, product,
service or other matter which: (i) is substantially similar to or competes
with any business, product, service or other matter regarding which Optionee
worked for the Company, or any of its affiliates, during the two (2) years
prior to Optionee's Termination of Employment; or (ii) concerns subject
matters about which Optionee gained proprietary information of the Company,
or its affiliates, during the two (2) year period prior to Optionee's
Termination of Employment.
(b) If the Company reasonably determines that Optionee has
materially violated any of Optionee's obligations under subparagraph (a),
above, then, in addition to any other remedies at law or in equity it may
have: (i) the Company shall have the right to cease payment of any
compensation, salary continuation, benefits, prerequisites and any other
remuneration which is due or may become due Optionee under any employment,
salary continuation or similar agreement between the Company, or any of its
affiliates, and Optionee; and (ii) all past, present and future stock option
grants awarded Optionee under the Plan, including grants which according to
their terms are vested, shall terminate, effective the date on which such
violation began (the "Violation Date"). The Company may demand the return of
any gain realized by Optionee from the exercise of any such grants by
Optionee at any time on or after the date sixty (60) days prior to the
Violation Date. If after such demand Optionee fails to return said amounts,
Optionee acknowledges that the Company has the right to offset against said
amounts any amounts, including compensation, owed Optionee by the Company or
to commence judicial proceedings against Optionee to recover said amounts and
any attorney's fees and costs.
(c) Optionee acknowledges and agrees that: (i) the restrictions
contained in this Section 13 are necessary to protect the legitimate
interests of the Company and impose no undue hardship on Optionee; (ii) the
violation or threatened violation of this Section 13 will result in
irreputable injury to the Company and Optionee consents to the issuance of
any restraining order, preliminary restraining order or injunction, without
5
bond, which arises from conduct by Optionee in violation of this Section 13,
and the existence of any claim Optionee may have against the Company will not
constitute a defense thereto; (iii) if the Company prevails in any suit or
proceeding to enforce its rights under this Section 13, Optionee shall
indemnify the Company for all expenses incurred by the Company, including
reasonable attorney's fees; and (iv) no one employed by or representing the
Company has any authority to make oral statements which modify, waive or
discharge in any manner any provision of this Section 13.
14. OTHER PROVISIONS.
a) Titles are provided herein for convenience only and are not to
serve as a basis for interpretation of the Agreement.
b) This Agreement may be amended only by a writing executed by the
parties hereto which specifically states that it is amending this Agreement.
c) THE LAWS OF THE STATE OF DELAWARE SHALL GOVERN THE
INTERPRETATION, VALIDITY AND PERFORMANCE OF THE TERMS OF THIS AGREEMENT
REGARDLESS OF THE LAW THAT MIGHT BE APPLIED UNDER PRINCIPLES OF CONFLICTS OF
LAWS.
6
IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the
Optionee have executed this Agreement as of the date of Grant first above
written.
NABISCO GROUP HOLDINGS CORP.
By:
-------------------------
Authorized Signatory
- ------------------------------
Optionee
Optionee's Taxpayer Identification Number:
- ------------------------------
Optionee's Home Address:
- ------------------------------
- ------------------------------
- ------------------------------
7