EXHIBIT 10.8
MILLERS AMERICAN GROUP, INC.
STOCK OPTION AGREEMENT
This OPTION AGREEMENT (this "Option Agreement") is entered into by and
between Millers American Group, Inc., a Texas corporation (the "Company"),
and the undersigned optionee (the "Optionee").
1. GRANT OF OPTION. The Company hereby grants to the Optionee effective
as of the date set forth in Section 20 hereof (the "Date of Grant"), the
right and option (the "Option") to purchase up to the aggregate number of
shares of common stock, par value $0.01 per share, of the Company (the
"Common Stock") set forth in Section 20 hereof, subject to adjustment
pursuant to Section 3 hereof and subject to the Optionee's acceptance and
agreement to all of the terms and conditions and restrictions described in
the Millers American Group, Inc. 1999 Stock Option Plan, as amended (the
"Plan"), a copy of which has been provided to the Optionee, and to the
further terms, conditions and restrictions set forth below.
2. EXERCISE PRICE. Subject to adjustment pursuant to Section 3, the
exercise price payable by the Optionee upon exercise of this Option is set forth
in Section 20 hereof.
3. ADJUSTMENTS TO NUMBER OF SHARES AND OPTION PRICE. The number of shares
and exercise price shall be subject to adjustments as provided in Section 9.4 of
the Plan.
4. TAX STATUS. This Option will be treated as an "incentive stock option"
within the meaning of Section 422 of the Code to the extent that any portion of
this Option meets the requirements of Section 422 of the Code. To the extent
that any portion of this Option does not meet such Code requirements, this
Option shall be deemed a nonqualified stock option.
5. EXERCISE OF OPTION. Subject to the terms of the Plan and this Option
Agreement, Optionee shall have the right to acquire shares of Common Stock under
this Option Agreement as follows:
(a) as of the Date of Grant and thereafter, Optionee may exercise
rights to acquire 33% of the Common Stock subject to the Option;
(b) as of the first anniversary of the Date of Grant and thereafter,
Optionee may exercise rights to acquire an additional 33% of the Common
Stock subject to the Option; and
(c) as of the second anniversary of the Date of Grant and thereafter,
Optionee may exercise rights to acquire an additional 34% of the Common
Stock subject to the Option.
6. EXPIRATION OF OPTION. This Option shall expire and cease to be
exercisable on the sixth anniversary of the Date of Grant or such earlier
date as may be specified in the Plan.
7. TERMINATION OF AFFILIATION.
(a) Subject to the following provisions of this Section 7 and Article
VI of the Plan, this Option may not be exercised unless at the time of
exercise the Optionee is an Employee or a Director of the Company or a
Subsidiary.
(b) TERMINATION FOR CAUSE. In the event that Optionee is an Employee
and the Optionee's employment by the Company or a Subsidiary shall
terminate for Cause (as defined in Section 6.1 of the Plan), this Option
shall terminate immediately. In the event that Optionee is a Director and
Optionee fails to be reelected as a Director, resigns as a Director or is
removed as a Director (other than due to Optionee's disability, as defined
in Section 6.3 of the Plan), this Option shall terminate immediately.
(c) DEATH OR DISABILITY. (i) In the event that the Optionee shall die
while employed by, or serving as a Director of, the Company or a Subsidiary
or if Optionee's employment by, or service as a Director of, the Company or
a Subsidiary is terminated because the Optionee has become disabled,
Optionee, his estate, or beneficiary shall have the right to exercise this
Option at any time within 60 days from the date of death of Optionee or
termination of his employment by, or service as a Director of, the Company
or a Subsidiary due to disability, as the case may be, only to the extent
the Optionee was entitled to exercise this Option immediately prior to such
occurrence. To the extent that this Option is not so exercised, it shall
expire at the end of such 60-day period. For purposes of this Option
Agreement, disability shall be as defined in Section 6.3 of the Plan.
(ii) If the Optionee dies during the 60-day period after
the termination of his or her position as an Employee or Director of
the Company or a Subsidiary and at the time of his or her death the
Optionee was entitled to exercise this Option, this Option shall
expire 60 days after the date on which his or her position as an
Employee or Director of the Company or a Subsidiary terminated, but in
no event, later than the date on which this Option would have expired
if the Optionee had lived. Until the expiration of such 60-day
period, this Option may be exercised by the Optionee's executor or
administrator or by any person or persons who shall have acquired the
Option directly from the Optionee by bequest or inheritance, but only
to the extent that the Optionee was entitled to exercise the Option at
the date of his or her death and, to the extent the Option is not so
exercised, it shall expire at the end of such 60-day period.
(d) RIGHT TO EXERCISE. In the event that termination of employment
with the Company occurs other than for Cause or for death or disability
pursuant to Sections 7(b) or 7(c) above, or in the event that the
directorship of an Optionee who is a Director is terminated for reasons
other than the removal, resignation, death or disability of Optionee, the
Optionee shall have the right to exercise this Option at any time within 60
days after such termination to the extent he was entitled to exercise the
same immediately prior to such termination. To the extent that this Option
is not so exercised, it shall expire at the end of such 60-day period.
8. PROCEDURE TO EXERCISE. The Optionee (or other person entitled to
exercise this Option) shall purchase shares of stock of the Company subject
hereto by the payment to the Company of the purchase price in full and the
amount of employment tax and withholding tax due, if any, upon the exercise
of this Option (i) by certified or official bank check, (ii) if so
permitted by the Company, by the delivery of a number of shares of Common
Stock (plus cash if necessary) having a fair market value equal to the
amount of such purchase price and employment and withholding tax, or (iii)
by delivery of the equivalent thereof acceptable to the Company. Any
employment or withholding tax due upon exercise of this Option shall be,
and shall remain, the responsibility of the Optionee (or such Optionee's
estate or representative). This Option may be exercised from time to time
by written notice to the Company stating the full number of shares to be
purchased and the time and delivery thereof, which shall be at least
fifteen days after the giving of notice unless an earlier date shall have
been agreed upon between the Optionee (or other person entitled to exercise
this Option) and the Company, accompanied by full payment for the shares as
described in the first sentence of this Section 8. The Company will, as
soon as is reasonably possible, notify the Optionee (or such Optionee's
representative) of the amount of employment tax and other withholding tax,
if any, that must be paid under federal, state and local law due to the
exercise of this Option. The Company shall have no obligation to deliver
certificates for the shares purchased until the Optionee (or such
Optionee's representative) pays to the Company the purchase price in full
and the amount of employment tax and withholding tax specified in the
Company's notice as described in this Section 8 by payment terms set forth
in the first sentence of this Section 8. At the time of delivery, the
Company shall, without transfer or issue tax to the Optionee (or other
person entitled to exercise this option) deliver at the principal office of
the Company, or at such other place as shall be mutually agreed upon, a
certificate or certificates for such shares, provided, however, that the
time of delivery may be postponed by the Company for such period as may be
required for it to comply with reasonable diligence with any requirements
of law. The foregoing notwithstanding, the Optionee may elect to exercise
the Option by a "cashless exercise" with a broker or by surrendering the
Option in exchange for an amount, payable (at Optionee's election) in cash
or shares of Common Stock (except for fractional shares which shall be paid
in cash) valued at Fair Market Value as of the date of such surrender, that
is equal to the difference between (i) the aggregate Fair Market Value of
the shares subject to the portion of the Option being exercised, minus (ii)
the total exercise price for the portion of the Option being exercised.
Withholding obligations as a result of such surrender of the Option shall
be satisfied by any lawful means approved by the Committee and agreed to
with Optionee at or prior to the time of surrender. This alternative
exercise procedure shall apply only to that portion of the Option that is
not exercised as an "incentive stock option" within the meaning of Section
422 of the Code.
9. NONTRANSFERABILITY OF OPTION. This Option shall not be assignable or
transferable other than by will or the laws of descent and distribution and
shall be exercisable during the Optionee's lifetime only by the Optionee.
10. CONTINUED EMPLOYMENT OR RETENTION. Subject to the terms of any
employment agreement between the Company and the Optionee, nothing herein shall
confer upon the Optionee any right to be continued in the employ or retention of
the Company or a Subsidiary, or continue to serve as a Director of the Company
or a Subsidiary, or shall prevent the Company or Subsidiary which employs or
retains the Optionee from terminating such employment at any time, with or
without cause, or removing or failing to reelect the Optionee as a Director.
11. RIGHTS AS SHAREHOLDER. Nothing herein is intended to or shall give to
the Optionee or the legal representatives, heirs, legatees, or distributees of
the Optionee any right or status of any kind as a shareholder of the Company in
respect of any shares of Common Stock covered by this Option or entitle the
Optionee or the legal representatives, heirs, legatees, or distributees of the
Optionee to any dividends or distributions thereon unless and until such shares
shall have been delivered to the Optionee or the legal representatives, heirs,
legatees, or distributees of the Optionee and registered in the Optionee's name
and the Optionee or the legal representatives, heirs, legatees, or distributees
of the Optionee has received a certificate or certificates therefor.
12. INTERPRETATION. If and when questions arise from time to time as to the
intent, meaning or application of the provisions hereof or of the Plan, such
questions shall be decided by the Board of Directors or the Committee in its
sole discretion, and any such decision shall be conclusive and binding on the
Optionee. The Optionee hereby agrees that this Option is granted and accepted
subject to such condition and understanding.
13. INVESTMENT REPRESENTATION. At such time or times as the Optionee may
exercise this Option, the Optionee shall, upon the request of the Company,
represent in writing (i) that the shares being acquired by the Optionee under
this Option will not be sold except pursuant to an effective registration
statement, or applicable exemption from registration, under the Securities Act
of 1933, as amended, (ii) that it is the Optionee's intention to acquire the
shares being acquired for investment only and not with a view to distribution
thereof, and (iii) other customary representations as the Company deems
necessary or advisable. No shares will be issued to the Optionee unless the
Optionee provides such representations and agreements and the Company is
satisfied as to the accuracy of such representations and agreements. If so
requested, Optionee agrees to provide a lock-up agreement prohibiting the sale
by Optionee of shares issued upon exercise of the Options for a period of 180
days following a public offering by the Company of its Common Stock.
14. REPURCHASE BY THE COMPANY. All shares of Common Stock purchased by the
Optionee or his or her estate or beneficiary and exercisable Options held by the
Optionee at the time of termination of employment shall be subject to repurchase
by the Company pursuant to Section 9.3 of the Plan.
15. WITHHOLDING OF TAXES. Upon exercise of this Option (either wholly or in
part), the Optionee must pay to the Company, or make arrangements satisfactory
to the Company regarding payment of, any federal, state or local taxes of any
kind required to be withheld in connection with the issuance to the Optionee of
Common Stock upon exercise of this Option. The Company may permit withholding of
shares of Common Stock in accordance with procedures established by the Company
as an election by Optionee to meet applicable withholding requirements.
16. NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered personally,
mailed certified mail (return receipt requested) or sent by overnight delivery
service, cable, telegram, facsimile transmission or telex to the Optionee at the
address on the signature page hereof and to the Company at the address set forth
below or at such other addresses as shall be specified by the parties by like
notice:
Millers American Group, Inc.
300 Burnett Street
Fort Worth, Texas 76102-2799
Attention: Chief Financial Officer
Facsimile No. (800) 826-9865
17. DEFINED TERMS. All capitalized terms used herein and not otherwise
defined shall have the meanings given them in the Plan.
18. CONFIDENTIALITY. Unless otherwise permitted by the Chairman of the
Board or the President of the Company, Optionee agrees to keep confidential the
terms of this Option Agreement (and the terms of any other Option Agreement with
any other Employee or Director of the Company known to Optionee) and shall not
disclose such terms to any other Employee or otherwise.
19. NONDISCLOSURE, NONCOMPETE, NONSOLICITATION. In further consideration
for the grant to Optionee of the Option evidenced by this Option Agreement,
Optionee hereby covenants and agrees as follows:
(a) Optionee hereby acknowledges that Optionee will have access to
certain trade secrets and confidential information of the Company and of
corporations and/or other business enterprises directly or indirectly
owned, controlled and/or operated by the Company ("Affiliates") and that
such information constitutes valuable, special and unique property of the
Company and such corporations. Optionee shall not, during or after the term
of Optionee's employment by the Company or a Subsidiary, disclose any such
trade secrets or confidential information to any person or entity for any
reason or purpose whatsoever except as may be required by law or use such
confidential information for any purpose not authorized by the Chairman of
the Board. Confidential information shall include (i) all information
designated as confidential by the Chairman of the Board and (ii) all
information the disclosure of which Optionee knows, or in the exercise of
reasonable care should know, would be damaging to the Company; provided,
however, that confidential information shall not include any information
known generally to the public (other than as a result of unauthorized
disclosure by Optionee) or any information not otherwise considered by the
Chairman of the Board or the Board of Directors to be confidential.
(b) Optionee agrees that during the term of Optionee's employment by,
or service as a Director of, the Company or a Subsidiary and for a period
of 24 months following the termination of Optionee's employment with, or
service as a Director of, the Company or a Subsidiary, Optionee shall not,
at any place within the States in which the Company or an Affiliate is
conducting business operations at the time of such termination, without the
prior written consent of the Chairman of the Board, either in his own
behalf or as a partner, officer, director, employee, agent or shareholder
(other than as the holder of less than 10% of the outstanding capital stock
of any corporation whose stock is traded on a national securities exchange)
engage in, be interested in or render services to any business then
competitive with the Company or a Subsidiary.
(c) Optionee agrees that during the term of Optionee's employment by,
or service as a Director of, the Company or a Subsidiary and for a period
of 24 months following the termination of Optionee's employment, or service
as a Director of, Optionee shall not, either alone or on behalf of any
business competing with the Company or any Affiliate, directly or
indirectly (i) solicit or induce, or in any manner attempt to solicit or
induce any person employed by, or an agent of, the Company or any Affiliate
to terminate his contract of employment or agency, as the case may be, with
the Company or any Affiliate, as the case may be, or (ii) solicit, divert,
or attempt to solicit or divert, as a supplier or customer, any person,
concern or entity which, as of the date of termination or during the one
year period prior thereto, furnishes products or services to, or receives
products and services from the Company or any Affiliate, nor will Optionee
attempt to induce any such supplier or customer to cease being (or any
prospective supplier or customer not to become) a supplier or customer of
the Company or any Affiliate.
20. SPECIFIED INFORMATION. This Option Agreement shall apply with respect
to the following specific information:
a. Date of Grant: ___________
b. Name of Optionee: ___________
c. Number of Shares Covered by Option: ___________
d. Option Exercise Price Per Share: $___________
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned have executed this Option
Agreement to be effective as of the Date of Grant set forth above.
MILLERS AMERICAN GROUP, INC.
By: ______________________________
Name: _______________________
Title: ______________________
__________________________________
_________________, Optionee
Optionee's Address:
_____________________
_____________________