Exhibit 10.3
MEMORANDUM OF AGREEMENT CONCERNING OPTIONS
To: ________________
From: Ladd Seaberg
Date: December 7, 2001
Re: Cancellation of Existing Stock Option and Grant of Option on June 8,
2000
In consideration of your offer to cancel the option granted to you on
January 5, 1996 to purchase ________ shares of the Common Stock of Midwest Grain
Products, Inc., the Company, as authorized by the Human Resources Committee on
this date, has agreed to issue to you on June 8, 2001, an option to purchase a
like number of shares upon the terms set forth in the option agreement that is
attached hereto. The option price per share for the option to be issued will be
the greater of $___.___, which is the per share fair market value of the Common
Stock as of 10:15 a.m. CST on December 7, 2000, or the per share fair market
value of the Common Stock as of 10:15 a.m. CDT on June 8, 2001.
___________________________
Ladd M. Seaberg, President
Cancellation of option is hereby acknowledged.
Dated December 7, 2000 ___________________________
MIDWEST GRAIN PRODUCTS, INC.
INCENTIVE STOCK OPTION
GRANTED UNDER THE STOCK INCENTIVE PLAN OF 1996
Date of Grant: June 8, 2001 ________ Shares
Time of Grant: 10:15 a.m. CDT
THIS OPTION IS NOT ASSIGNABLE
Grant. Midwest Grain Products, Inc., a Kansas corporation (the
"Company"), hereby grants to the optionee named below an option to purchase, in
accordance with and subject to the terms and restrictions set forth in the
Midwest Grain Products, Inc. Stock Incentive Plan of 1996 (the "Plan"), as
amended and in this option, the number of shares of Common Stock, no par value,
of the Company ("Shares") set forth below, at the price set forth below and
expiring at the date set forth below:
Optionee: ________________________________________________
Number of Shares subject to option: ______________________
Number of such Shares to be Incentive Options: ____________
Number of such Shares to be Nonqualified Options: _________
Option price per Share: ___________________________________
Incentive Stock Option. This option is intended to qualify as an
incentive stock option under Section 422 of the Code, as amended from time to
time ("Incentive Option") as to the shares specified above to be Incentive
Options and as a nonqualified option as to the remainder of such shares
("Nonqualified Option"); provided that to the extent that the aggregate fair
market value (as defined in the Code), of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by you during any
calendar year under the Plan or any other Company plan exceeds $100,000, this
Option shall be treated as a Nonqualified Option in accordance with the
provisions of Section 422 of the Code, as amended.
Exercisability.
(a) Incentive Option Installments. Subject to the $100,000
limitation, the Incentive options shall become exercisable as to all or any part
of _______ shares upon the first anniversary of the Date of Grant, _______
shares upon the second anniversary of the Date of Grant, _______ shares on the
third anniversary of the Date of Grant and ________ shares on the fourth
anniversary of the Date of Grant; provided, that in the case of death or normal
retirement all installments shall become immediately exercisable as of the day
immediately prior to the date of death or date of retirement.
(b) Nonqualified Option Installments. The Nonqualified options
shall become exercisable as to all or any part of _______ shares upon the first
anniversary of the Date of Grant, _______ shares upon the second anniversary of
the Date of Grant, _______ shares on the third anniversary of the Date of Grant
and ________ shares on the fourth anniversary of the Date of
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Grant; provided, that in the case of death or normal retirement all installments
shall become immediately exercisable as of the day immediately prior to the date
of death or date of retirement.
(c) Other Provision concerning Exercisability. The options shall
otherwise be exercisable to the extent permitted in the Plan, including
provisions therein relating to a Change In Control, death, retirement or other
termination of employment. Installments or portions thereof not exercised in
earlier periods shall be cumulative and shall be available for exercise in later
periods.
Term. All options granted to you under this grant must be exercised, if
at all, on or before December 6, 2010. In the event of your death, retirement
from the Company or other termination of employment, whether voluntary or
involuntary, the options will expire and may be exercised in the manner
specified in Section 6 of the Plan.
Exercise. Upon exercise of an option, you may pay all or any part of
the option price in cash, by check satisfactory to the Company or by transfer to
the Company of shares of Mature Stock or other Common Stock which was not
obtained through the exercise of a stock option owned by the Optionee. Common
Stock transferred to the Company or withheld from shares to be distributed in
payment of the option price or withholding taxes shall be valued at the Fair
Market Value of the Common Stock on the date of the exercise.
Option Not Assignable. This Option is not transferable by you otherwise
than by will or the laws of descent and distribution, and is exercisable, during
your lifetime, only by you; provided, however, to the extent that the options
covered hereby constitute nonqualified stock options, you may assign such
options to the extent that such assignment is hereafter approved in writing by
the Committee..
Not a 10% Owner. You hereby certify that, at the date hereof, you
believe that you do not own stock of the Company that possesses more than 10
percent of the total combined voting power of all classes of stock of the
Company or of any parent or subsidiary of the Company.
Payment of Taxes. The Plan grants the Company the authority to make
such provision as the Company deems appropriate for the collection of any taxes
which the Company may withhold in connection with the grant or exercise of
options. Pursuant to that authority, the Company authorizes you to settle
withholding taxes generated upon the exercise of Nonqualified Options by
allowing you to pay the taxes with cash or shares of the Company's Common Stock
in accordance with the following guidelines:
1. You may satisfy obligations to pay to the Company the amount of any
federal, state or local income tax imposed on you as a result of the exercise of
this option by either:
(a) Delivering to the Company a personal check satisfactory to the
Company in the amount of the tax liability on the date that the amount of the
tax to be withheld is to be determined (the "Tax Date"); or by
(b) Electing to pay the tax liability in shares of the Company's Common
Stock ("Stock Payment Election") by
(1) directing the Company at or prior to the Tax Date to withhold
from the number of shares to be issued to the optionee in connection with the
exercise of a Nonqualified Option that
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number of shares equal to the amount of the tax liability divided by the fair
market value (as defined by the Plans) of one share of the Company's common
stock on the Tax Date; or
(2) delivering to the Company on the Tax Date good and marketable
title to that number of shares of Mature Stock (as defined in the Plan) or other
Stock which was not obtained through the exercise of a stock option owned by
you, as shall equal the amount of the tax liability divided by the fair market
value of one share of the Company's common stock on the Tax Date.
2. No fractional shares will be issued in connection with any election to
satisfy a tax liability by paying in shares. The balance of any tax liability
representing a fraction of a share will be settled in cash.
3. The amount of tax which may be paid by an optionee pursuant to a Stock
Payment Election will be the minimum required federal (including FICA and FUTA)
and state withholding amounts at the time of the election to pay the taxes with
surrendered or withheld shares.
4. The provisions of these rules relating to the use of stock to satisfy
obligations may be unilaterally revised by the Committee from time to time to
conform the same to any applicable laws or regulations.
Compliance With Law. When the issue or transfer of the shares covered
by this option may, in the opinion of the Company, conflict or be inconsistent
with any applicable law or regulation of any governmental agency having
jurisdiction, the Company reserves the right to refuse to issue or transfer said
stock. The Company may also legend certificates covering shares purchase
hereunder with usual and customary transfer restrictions to insure compliance
with applicable securities laws, and may issue the same subject to its prior
receipt of written representations from optionee in form and substance
satisfactory to the Company.
IN WITNESS WHEREOF, this instrument has been executed by the Company as
of this __ day of _____, 200_.
MIDWEST GRAIN PRODUCTS, INC.
By_________________________________
Laidacker M. Seaberg
President and Chief Executive Officer
ACKNOWLEDGMENT
I hereby acknowledge receipt of the above option and a copy of the Plan
referred to in said option. I am familiar with the terms of the Plan, and I
understand my rights under the option are subject to and governed by the terms
of the Plan, as well as by the terms set forth in the foregoing option itself.
________________________________ __________________________________
Date Acknowledged Signature of Optionee
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