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EXHIBIT 10(ab)
NONQUALIFIED STOCK OPTION AGREEMENT
This Nonqualified Stock Option Agreement is made as of the 12th day of
October, 1994 between GENESCO INC., a Tennessee corporation (hereinafter called
the "Company"), and David M. Chamberlain (hereinafter called the "Optionee"),
pursuant to authorization by the compensation committee of the Company's board
of directors (hereinafter called the "Committee").
The Company and the Optionee agree as follows:
1. GRANT OF OPTION. As of the date hereof, the Company hereby
grants to the Optionee the right and option (hereinafter called the "Option")
to purchase an aggregate of 100,000 shares of its authorized common stock
(hereinafter called the "Stock"), subject to the terms and conditions of this
agreement. The Option granted hereunder is not an incentive stock option
within the meaning of section 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
2. PURCHASE PRICE. The purchase price of the shares of Stock
covered by the Option shall be $2.38 per share (the "Option Price") and shall
be payable either in cash or by delivery of shares of Stock having a Fair
Market Value (as defined below) on the date of exercise equal to the total
purchase price of the shares to be purchased on such date, together with any
applicable taxes required to be withheld by the Company or a Subsidiary (as
defined below) or Parent (as defined below) of the Company as provided in
Section 8. The Optionee shall not have any of the rights of a shareholder with
respect to any of the shares of Stock subject to an Option or with respect to
shares issuable upon surrender of the right to exercise an Option, unless and
until he shall become the holder of record of such shares.
"Fair Market Value" means the reported closing price of the Stock on
the New York Stock Exchange - Composite Transactions on the relevant
date or, if no shares are traded on that date, the reported closing
price on the next preceding date on which shares were traded. In the
event the Stock is no longer reported on the New York Stock Exchange -
Composite Transactions, Fair Market Value shall be determined by such
other method as the Committee in good faith deems appropriate without
regard to any restriction other than a restriction which, by its
terms, will never lapse.
"Parent" means a parent corporation as defined in section 424(e) of
the Code.
"Subsidiary" means a subsidiary corporation as defined in section
424(f) of the Code.
3. TERM OF OPTION. The Option shall terminate at 5:00 p.m.
(Nashville, Tennessee time) on October 12, 2004.
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4. EXERCISE OF OPTION. All of the shares subject to the Option
may be purchased after April 12, 1995; or immediately upon a change of control
(as defined below) of the Company.
The term "change in control" means a change in control of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act") as in effect on the date of this stock option
agreement, provided that, without limitation, such a change in control shall be
deemed to have occurred if and when (A) any "person" (as such term is defined
in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a
beneficial owner, directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the Company's then
outstanding securities or (B) individuals who were members of the board of
directors of the Company immediately prior to a meeting of the shareholders of
the Company involving a contest for the election of directors do not constitute
a majority of the board of directors following such election.
5. SURRENDER OF OPTIONS. The Optionee is authorized during his
employment to surrender the right to exercise the Option or any portion thereof
to the extent then exercisable in exchange for the payment to the Optionee of
an amount equal to the excess of the Fair Market Value of the shares of Stock
to which the Option (or portion thereof) relate on the date of surrender of
such right over the total Option Price of such shares, less any applicable
withholding taxes required to be withheld by the Company or a Subsidiary or
Parent of the Company. Such payment shall be made in shares of Stock valued at
their Fair Market Value on such date (with cash in lieu of fractional shares),
cash or a combination thereof, in such proportion and upon such terms and
conditions and subject to such restrictions as shall be determined by the
Committee. The surrender of the right to exercise the Option shall be made
only if the Company (i) has filed all reports and statements required to be
filed pursuant to section 13 of the Exchange Act, and only during a period
beginning on the third business day following the date on which quarterly or
annual summary statements of the Company's sales and earnings have been made
publicly available and ending on the twelfth business day following such date
or (ii) has otherwise complied with the requirements of Rule 16b-3 under the
Exchange Act with respect to the Option.
6. CAPITAL ADJUSTMENTS AND CORPORATE REORGANIZATIONS. In the
event of any change in the outstanding shares of Stock by reason of a Stock
dividend, split or combination, a recapitalization or reclassification, or a
reorganization, merger or consolidation in which the Company is the surviving
corporation or other similar change affecting the Stock, the number and class
of shares then subject to the Option and for which the Option may thereafter be
exercised and the amounts per share of Stock payable upon exercise or surrender
of such Option shall be appropriately adjusted by the Committee to reflect such
change. No fractional shares shall be issued as a result of such adjustment.
In the event of a dissolution of the Company or a reorganization, merger or
consolidation in which the Company is not the surviving corporation, the
Company by action of the Committee shall either (i) terminate outstanding and
unexercised Options as of the effective
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date of such dissolution, merger or consolidation by giving notice to the
Optionee of its intention to do so and permitting the exercise, during a period
prior to such effective date to be specified by the Committee, of all
outstanding and unexercised Options or portions thereof, provided that no
Option shall become exercisable hereunder either after the expiration date
thereof or prior to six months from date of grant thereof, or (ii) in the case
of such reorganization, merger or consolidation, arrange for an appropriate
substitution of shares or other securities of the corporation with which the
Company is reorganized, merged or consolidated in lieu of the shares of Stock
which are subject to such outstanding and unexercised Options.
7. NON-TRANSFERABILITY. The Option may not be assigned, pledged
or otherwise transferred except by will or the laws of descent and distribution
and, during the Optionee's lifetime, may be exercised only by the Optionee.
8. WITHHOLDING TAXES. Upon exercise of an Option which requires
the Company at the time of exercise to withhold any Federal, state or local
income or other taxes by reason of the exercise of such Option, the Optionee
shall tender to the Company along with payment of the total Option Price of the
shares an amount in cash equal to such withholding taxes as determined by the
Company or, alternatively, may make a written request to the Committee that the
Company withhold from the shares to be received by the Optionee upon exercise
of the Option shares of Stock having an aggregate Fair Market Value on the date
of exercise at least equal to the applicable withholding taxes. The acceptance
by the Committee of any such request by an Optionee shall be in the sole
discretion of the Committee. If the exercise of an Option will give rise to an
obligation to withhold Federal income taxes subsequent to the date of exercise,
the Committee may, in its sole discretion, require the Optionee to place the
shares of Stock purchased under the Option in escrow for the benefit of the
Company until such time as any amount is required to be included in the gross
income of the Optionee as a result of the exercise of the Option. The
Committee may, in its sole discretion, at any time require that the Optionee
pay the applicable withholding taxes to the Company in cash, in which case the
shares of Stock shall be released from escrow to the Optionee. Alternatively,
the Committee, in its sole discretion, may permit the Company to accept the
shares of Stock held in escrow to satisfy the Company's withholding obligation
based on the Fair Market Value of the shares on the date of the termination of
the escrow arrangement. Upon application of such shares to the Company's
withholding obligation, any shares of Stock held in escrow which are not, in
the sole judgment of the Committee, necessary to satisfy such obligation shall
be released from escrow to the Optionee.
9. GOVERNING LAW. This agreement shall be governed by and
construed in accordance with the laws of the State of Tennessee.
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IN WITNESS WHEREOF, this agreement has been duly executed by the
Company and the Optionee.
GENESCO INC.
By: /s/ Harry D. Garber
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Title: Chairman
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OPTIONEE
/s/ David M. Chamberlain
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David M. Chamberlain
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