EHIXIBIT 10.67
BRENDLE'S INCORPORATED 1986 INCENTIVE STOCK OPTION PLAN
THREE-YEAR VESTING
STOCK OPTION GRANT AGREEMENT
FOR
JOSEPH M. McLEISH
Date of Grant: February 27, 1995
THIS STOCK OPTION GRANT AGREEMENT, dated as of the date of
grant first stated above (the "Date of Grant"), is delivered by
BRENDLE'S INCORPORATED, a North Carolina corporation ("Brendle's"
or "Company") to JOSEPH M. McLEISH (the "Grantee"), who is a key
employee of Brendle's.
WHEREAS, the Board of Directors of Brendle's (the "Board") on
January 31, 1986, adopted, with subsequent stockholder approval,
the Brendle's Incorporated 1986 Incentive Stock Option Plan (the
"Plan");
WHEREAS, the Plan provides for the granting of incentive stock
options by a Stock Option Committee, which is now the Compensation
Committee of the Board, (the "Committee"), to unaffiliated
directors, certain officers and key employees of Brendle's or any
subsidiary of Brendle's to purchase, or to exercise certain rights
with respect to, shares of Brendle's $1.00 par value common stock
(the "Stock"), in accordance with the terms and provisions thereof;
and
WHEREAS, the Committee considers the Grantee to be a person
who is eligible for a grant of incentive stock options under the
Plan, and has determined that it would be in the best interest of
Brendle's to grant the incentive stock options documented herein.
NOW, THEREFORE, the parties hereto, intending to be legally
bound hereby, agree as follows:
1. Grant of Options. Brendle's hereby grants to the
Grantee, as of the Date of Grant, the right, privilege and option
to purchase up to 50,000 shares of the Stock at a price of sixty-two and
one-half cents ($.625) per share, which price is one
hundred percent (100%) of the fair market value of the Stock as of
the Date of Grant. Such option is hereinafter referred to as the
"Option" and the shares of Stock purchasable upon exercise of the
Option are hereinafter sometimes referred to as "Option Shares."
The option is intended by the parties hereto to be, and shall be
treated as, an Incentive Stock Option [as such term is defined
under Section 422 of the Internal Revenue Code of 1986 (the
"Code")].
2. Schedule of Exercise of Option. The Grantee shall have
the right to exercise the Option granted herein above in accordance
with the following schedule:
Cumulative Percentage of
Option Shares Exercisable: Earliest Date of Exercise:
Thirty Percent (30%) First Anniversary of the
Date of Grant
Sixty Percent (60%) Second Anniversary of the
Date of Grant
One Hundred Percent (100%) Third Anniversary of the
Date of Grant
EXPLANATORY NOTE: On and after the Second Anniversary of the Date
of Grant, the Grantee may exercise an additional 30% of the Option
Shares for a cumulative total of 60% of the Option Shares, and on
and after the Third Anniversary, the Grantee may exercise an
additional 40% of the Option Shares, for a cumulative total of 100%
of the Option Shares.
3. Termination of Option.
(a) The Option granted hereunder, to the extent any Option
Shares shall remain unexercised, shall terminate and become null
and void after the expiration of five (5) years from the Date of
Grant (said five-year period hereafter called the "Option Term").
(b) The Grantee may not transfer, assign, pledge or
hypothecate in any way all or any portion of the Option granted
hereunder, nor shall the Option granted hereunder be subject to
execution, attachment or similar legal process. Upon any attempt
so to transfer, assign, pledge, hypothecate or otherwise dispose of
all or any portion of the Option granted hereunder, or upon the
levy or any attachment or similar legal process upon such Option,
such Option, and any right or pledge conferred thereby, shall
immediately terminate and become null and void.
(c) Upon the occurrence of the Grantee's ceasing for any
reason to be employed by the Company (such occurrence being a
"termination of the Grantee's employment"), the Option, to the
extent not previously exercised, shall terminate and become null
and void immediately upon such termination of the Grantee's
employment, except in a case where the termination of the Grantee's
employment is by reason of retirement at Retirement Date (as such
term is defined in the Plan), disability or death.
Upon a termination of the Grantee's employment by reason of
retirement or disability, the Option may be exercised during the
following periods, but only to the extent that the Option was
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outstanding and exercisable on any such date of retirement or
disability: (ii) the one-year period following the date of such
termination of the Grantee's employment in the case of a disability
(within the meaning of Section 22(e)(3) of the Code), and (ii) the
three-month period following the date of such termination in the
case of retirement upon the attainment of his Retirement Date. In
no event, however, shall any such period extend beyond the Option
Term.
(d) In the event of the death of the Grantee, the Option may
be exercised by the person or persons to whom the Option is
transferred by will or by the laws of descent and distribution, but
only to the extent that the Option would otherwise have been
exercisable by the Grantee.
(e) A transfer of the Grantee's employment between Brendle's
and any subsidiary of Brendle's, or between any subsidiaries of
Brendle's shall not be deemed to be a termination of the Grantee's
employment.
(f) Whether a leave of absence shall constitute a termination
of employment shall be determined by the Committee, whose decision
shall be final and conclusive.
(g) Notwithstanding any other provisions set forth herein or
in the Plan, if the Grantee shall (i) commit any act of malfeasance
or wrongdoing affecting Brendle's or any subsidiary of Brendle's,
(ii) breach any covenant not to compete, or employment contract,
with Brendle's or any subsidiary of Brendle's or (iii) engage in
conduct that would warrant the Grantee's discharge for cause
(excluding general dissatisfaction with the performance of the
Grantee's duties, but including any act of disloyalty or any
conduct clearly tending to bring discredit upon Brendle's or any
subsidiary of Brendle's), any unexercised portion of the Option
shall immediately terminate and be void.
4. Exercise of Option.
(a) The Grantee may exercise his rights hereunder with
respect to all or any part of the Option then exercisable hereunder
by giving the Corporate Secretary of Brendle's written notice of
intent to exercise as provided in Paragraph 11 hereof. The notice
of exercise shall specify the number of Option Shares as to which
the Option is to be exercised and the date of exercise thereof,
which date shall be at least five days after the giving of such
notice unless an earlier time shall have been mutually agreed upon.
(b) Upon the exercise of an Option, full payment (in U.S.
Dollars) by the Grantee of the option price for the Option Shares
purchased shall be made on or before the exercise date specified in
the notice of exercise in cash, or by check, bank draft or money
order payable to the order of the Company, or, with the prior
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written consent of the Committee, in whole or in part through the
surrender of previously acquired shares of Stock at their fair
market value on the exercise date.
On the exercise date specified in the Grantee's notice or as
soon thereafter as is practicable, Brendle's shall cause to be
delivered to the Grantee, a certificate or certificates for the
Option Shares then being purchased (out of theretofore unissued
Stock) upon full payment for such Option Shares. The obligation of
Brendle's to deliver Stock shall, however, be subject to the
condition that if at any time the Committee shall determine in its
discretion that the listing, registration or qualification of the
Option or the Option Shares upon any securities exchange or under
any state or federal law, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the Option or the issuance or
purchase of Option Shares thereunder, the Option may not be
exercised in whole or in part unless such listing, registration,
qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.
(c) If the Grantee fails to pay for any of the Option Shares
specified in such notice or fails to accept delivery thereof, the
Grantee's right to purchase such Option Shares may be terminated by
Brendle's. The date specified in the Grantee's notice as the date
of exercise shall be deemed the date of exercise of the Option,
provided that payment in full for the Option Shares to be purchased
upon such exercise shall have been received by such date.
5. Adjustment of and Changes in Stock of Brendle's. In the
event of a reorganization, recapitalization, change of shares,
stock split, spin-off, stock dividend, reclassification,
subdivision or combination of shares, merger, consolidation, rights
offering, or any other change in the corporate structure or shares
of capital stock of Brendle's, the Committee shall make such
adjustment as it deems appropriate in the number and kind of Option
Shares available for purchase pursuant to the Option or in the
option price; provided, however, that no such adjustment shall give
the Grantee any additional benefits under the Option.
Upon the effective date of the dissolution or liquidation of
the Company, or of a reorganization, merger or consolidation of the
Company in which the Company is not the surviving corporation, the
Option granted hereunder shall terminate, unless provision is made
in writing by the Committee stating otherwise.
6. Fair Market Value. As used herein, the "fair market
value" of the Option Shares shall be the mean of the bid and asked
prices at which the Company's shares of common stock are quoted or
traded in the market in which the Stock generally has the greatest
trading volume (currently the shares are primarily traded on the
NASDAQ National Market System) on the applicable date of reference
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hereunder, or if there is no trading on such date, then the average
of such high and low prices on the last previous day on which
trading is reported.
7. No Rights of Stockholders. Neither the Grantee nor any
personal representative shall be, or shall have any of the rights
and privileges of, a stockholder of Brendle's with respect to any
Option Shares purchasable upon the exercise of the Option, in whole
or in part, prior to the date of exercise of the Option.
8. Non-Transferability of Option. During the Grantee's
lifetime, the Option hereunder shall be exercisable only by the
Grantee or any guardian or legal representative of the Grantee, and
the Option shall not be transferable by action, document or
operation of law, except, in case of the death of the Grantee, by
will or by the laws of descent and distribution, nor shall the
Option be subject to attachment, execution or other similar
process. In the event of (a) any attempt by the Grantee to
alienate, assign, pledge, hypothecate or otherwise dispose of the
Option, except as provided for herein, or (b) the levy of any
attachment, execution or similar process upon the rights or
interest hereby conferred, Brendle's may terminate the Option by
notice to the Grantee and such Option shall thereupon become null
and void.
9. Employment Not Affected. The granting of the Option or
its exercise shall not be construed as granting to the Grantee any
right with respect to continuance of employment with Brendle's.
Except as may otherwise be limited by a further written agreement
between Brendle's and the Grantee, the right of Brendle's to
terminate at will the Grantee's employment with Brendle's at any
time (whether by dismissal, discharge, retirement or otherwise) is
specifically reserved by Brendle's as the employer and acknowledged
by the Grantee.
10. Amendment of Option. The terms of this Agreement may be
amended by the Board or the Committee at any time (i) if the Board
or the Committee determines, in its sole discretion, that amendment
is necessary or advisable in the light of any addition to or change
in the Internal Revenue Code of 1986 or in the regulations issued
thereunder, or any federal or state securities law or other law or
regulation, which change occurs after the Date of Grant and by its
terms applies to the Option; or (ii) other than in the
circumstances described in clause (i), with the consent of the
Grantee.
11. Notice. Any notice to Brendle's provided for in this
instrument shall be addressed to it in care of its Corporate
Secretary (currently, David R. Renegar) at its executive offices at
1919 N. Bridge Street Ext., Elkin, North Carolina 28621, and any
notice to the Grantee shall be addressed to the Grantee at the
current address then shown on the payroll records of Brendle's.
Any notice shall be deemed to be duly given if and when properly
addressed and posted by registered or certified mail, postage
prepaid.
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12. Incorporation of Plan by Reference. The Option is
granted pursuant to the terms of the Plan, the terms of which are
incorporated herein by reference, and the Option shall in all
respects be interpreted in accordance with the Plan. The Committee
shall interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding
on the parties hereto and any other person claiming an interest
hereunder, with respect to any issue arising hereunder or
thereunder.
13. Governing Law. The validity, construction,
interpretation and effect of this instrument shall exclusively be
governed by and determined in accordance with the law of the State
of North Carolina, except to the extent preempted by federal law,
which shall to that extent govern.
14. Value of Securities; No Representations, Warranties.
Brendle's makes no representations, warranties or affirmations as
to the price, continuing value, appreciation of, or future market
for, any of the Stock purchased pursuant to this Grant. Grantee
acknowledges that Brendle's has provided to him all information
pertinent to his exercise of this grant, and that he is fully
informed of all factors which he deems relevant to any decision
made with respect to this Grant.
IN WITNESS WHEREOF, Brendle's has caused its duly authorized
Officer to execute this Stock Option Grant Agreement, and to apply
the corporate seal hereto, and the Grantee has placed his or her
signature hereon, effective as of the Date of Grant.
BRENDLE'S INCORPORATED
By: _(Signature of David R. Renegar V.P. appears here)_
ACCEPTED AND AGREED TO:
_(Signature of Joseph M. McLeish appears here)_(Seal)
Joseph M. McLeish, Executive