Exhibit 10.11
RAYOVAC CORPORATION
1996 STOCK OPTION PLAN
1. Purpose: Restrictions on Amount Available under the Plan.
This Rayovac Corporation, 1996 Stock Option Plan ("Plan") is intended
to afford an incentive to selected employees and directors of Rayovac
Corporation ("Rayovac") or any Subsidiary (as defined in Section 2(l) hereof)
(collectively referred to as the "Company"), to acquire a proprietary interest
in the Company, to continue to perform services for the Company, to increase
their efforts on behalf of the Company and to promote the success of the
Company's business.
2. Definitions.
As used in this Plan, the following words and phrases shall have the
meanings indicated:
(a) "Board" shall mean the Board of Directors of
Rayovac.
(b) "Code" shall mean the Internal Revenue Code of 1986,
as amended.
(c) "Disability" shall mean a Participant's disability within
the meaning of Section 22(e)(3) of the Code, or any successor
provision.
(d) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended.
(e) "Fair Market Value" per share as of a particular date
shall mean (i) the closing sales price per share of Common Stock (as
defined in Section 5 hereof) on the New York Stock Exchange for the
last preceding date on which there was a sale of such Common Stock on
such exchange, or (ii) if the shares of Common Stock are not then
admitted for trading on the New York Stock Exchange, the closing price
for the shares of Common Stock in such other national securities
exchange or interdealer quotation system on which Common Stock is then
traded for the last preceding date on which there was a sale of such
Common Stock in such market, or (iii) if the shares of Common Stock are
not then listed on a national securities exchange or interdealer
quotation system, such value as the Committee in good faith may
determine.
(f) "Option" shall mean the right, granted pursuant to this
Plan, of a holder to purchase shares of Common Stock at a price and
upon the terms to be specified by the Committee.
(g) "Option Agreement" shall mean any written agreement,
contract, or other instrument or document between the Company and a
Participant evidencing an Option.
(h) "Participant" shall mean an officer, employee or director
of the Company who is, pursuant to Section 4 of the Plan, selected to
participate herein.
(i) "Subsidiary" shall mean any corporation (other than
Rayovac) in an unbroken chain of corporations beginning with Rayovac
if, at the time of granting an Option, each of such corporations other
than the last corporation in the unbroken chain owns stock possessing
fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
3. Administration.
Unless otherwise determined by the Board, the Plan shall be
administered by a committee of the Board ("Compensation Committee"), which shall
consist of two or more members of the Board. Following such time that Common
Stock is registered pursuant to Section 12 of the Exchange Act, members of the
Compensation Committee shall be "non-employee directors" as defined in Rule 16b-
3 under the Exchange Act. The Compensation Committee may, in its discretion,
delegate to a subcommittee its duties hereunder, including the grant of Options.
The full Board shall also have the authority, in its discretion, to grant
Options under the Plan and to administer the Plan. For all purposes under the
Plan, any entity which performs the duties described herein, shall be referred
to as the "Committee."
The Committee shall have the authority in its discretion, subject to
and not inconsistent with the express provisions of the Plan, to administer the
Plan and to exercise all the powers and authorities either specifically granted
to it under the Plan or necessary or advisable in the administration of the
Plan, including, without limitation, the authority to grant Options; to
determine the persons to whom and the time or times at which Options shall be
granted; to determine the type and number of Options to be granted, the number
of shares of Common Stock to which an Option may relate and the terms,
conditions and restrictions relating to any Option; to determine whether, to
what extent, and under what circumstances an Option may be settled, cancelled,
forfeited, exchanged, or surrendered; to construe and interpret the Plan and any
Option; to prescribe, amend and rescind rules and regulations relating to the
Plan; to determine the terms and provisions of Option Agreements; and to make
all other determinations deemed necessary or advisable for the administration of
the Plan.
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No member of the Committee shall be liable for any action taken or
determination made in good faith with respect to the Plan or any Option granted
hereunder.
4. Eligibility.
Options may be granted to employees and directors of the Company or a
Subsidiary. In determining the persons to whom Options shall be granted and the
number of shares to be covered by each Option, the Committee shall take into
account the duties of the respective persons, their present and potential
contributions to the success of the Company and such other factors as the
Committee shall deem relevant in connection with accomplishing the purpose of
the Plan.
5. Stock.
The stock subject to Options hereunder shall be shares of Rayovac
common stock, par value $0.01 per share ("Common Stock"). Such shares may, in
whole or in part, be authorized but unissued shares or shares that shall have
been or that may be reacquired by the Company. The aggregate number of shares of
Common Stock as to which Options may be granted from time to time under the Plan
shall not exceed [________].(1) No person may be granted Options under the Plan
during any calendar year representing an aggregate of more than [_________]
shares of Common Stock. The limitations established by the preceding two
sentences shall be subject to adjustment as provided in Section 7 hereof.
6. Stock Options.
The Committee shall have authority to grant Options to Participants on
the following terms and conditions:
(a) Number of Shares. Each Option Agreement shall state the
number of shares of Common Stock to which the Option relates.
(b) Type of Option. No Option granted pursuant to this Plan
shall be an incentive stock option within the meaning of Section 422 of the
Code.
(c) Exercise Price. Each Option Agreement shall state the
Exercise Price. The Exercise Price per share of Common Stock purchasable under
an Option shall be determined by the Committee. The date as of which the
Committee adopts a resolution expressly granting an Option shall be considered
the day on which such Option is granted.
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(1) The number shall equal 10% of the outstanding capital stock of Rayovac (on
a fully diluted basis) immediately after the transactions contemplated by
the Stock Purchase and Redemption Agreement.
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(d) Method and Time of Payment. The Exercise Price shall be
paid in full, at the time of exercise, in cash or in shares of Common Stock
having a Fair Market Value equal to such Exercise Price or in a combination of
cash and Common Stock or, in the sole discretion of the Committee, through a
cashless exercise procedure.
(e) Term and Exercisability of Options. Options shall be
exercisable over the exercise period (which, with respect to Incentive Stock
Options, shall not exceed ten years from the date of grant), at such times and
upon such conditions as the Committee may determine, as reflected in the Option
Agreement; provided that, the Committee shall have the authority to accelerate
the exercisability of any outstanding Option at such time and under such
circumstances as it, in its sole discretion, deems appropriate. An Option may be
exercised, as to any or all full shares of Common Stock as to which the Option
has become exercisable, by written notice delivered in person or by mail to the
Compensation Committee or as it shall direct, specifying the number of shares of
Common Stock with respect to which the Option is being exercised. The exercise
period shall be subject to earlier termination as provided in Section 6(f)
hereof. At the time any Option granted under the Plan is exercised, the Company
shall be entitled to legend the certificates representing the shares of Common
Stock purchased pursuant to the Option to clearly identify them as representing
shares purchased upon exercise of an Option.
(f) Termination. If a Participant's employment by, or service
as a director with, the Company terminates:
(i) Unless provided otherwise in the applicable
Option Agreement, upon a Participant's termination of
employment or service as a director with the Company or a
Subsidiary by reason of death or Disability or by the Company
without cause, all Options that are not then exercisable shall
immediately terminate and all Options that are then
exercisable shall remain exercisable for a period of one year
following such termination and shall terminate thereafter;
(ii) Unless provided otherwise in the applicable
Option Agreement, if a Participant's employment or service as
a director with the Company is terminated by the Company for
cause, all Options shall immediately terminate.
(iii) Unless provided otherwise in the applicable
Option Agreement upon any termination of Participant's
employment or service as a director with the Company other
than for cause, without cause or by reason of death or
Disability, all Options that are not then exercisable
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shall immediately terminate and all Options that are then
exercisable shall remain exercisable for a period of thirty
days from the date of such termination and shall terminate
thereafter.
(g) Other Provisions. Options may be subject to such other
conditions including, but not limited to, restrictions on transferability of the
shares acquired upon exercise of such Options, as the Committee may prescribe in
the Option Agreement in its discretion.
7. Effect of Certain Changes.
If there is any change in the number of outstanding shares of Common
Stock by reason of any stock dividend, stock split, recapitalization,
combination, exchange of shares, merger, consolidation, liquidation, split-up,
spin-off or other similar change in capitalization, any distribution to common
shareholders, including a rights offering, other than cash dividends, or any
like change, then the number of shares of Common Stock available for Options,
the number of such shares covered by outstanding Options, and the Exercise Price
of such Options shall be proportionately adjusted by the Committee to reflect
such change or distribution; provided, however, that any fractional shares
resulting from such adjustment shall be eliminated. In the event of a change in
the Common Stock of the Company as presently constituted, which is limited to a
change of all of its authorized shares with par value into the same number of
shares with a different par value or without par value, the shares resulting
from any such change shall be deemed to be the Common Stock within the meaning
of the Plan. To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Committee,
whose determination in that respect shall be final, binding and conclusive,
provided that each Incentive Stock Option granted pursuant to this Plan shall
not be adjusted in a manner that causes such Option to fail to continue to
qualify as an Incentive Stock Option within the meaning of Section 422 of the
Code.
8. General Provisions.
(a) Restrictions on Delivery and Sale of Shares. Each Option
granted under the Plan is subject to the condition that if at any time the
Committee, in its discretion, shall determine that the listing, registration or
qualification of the shares covered by such Option upon any securities exchange
or under any state or federal law is necessary or desirable as a condition of or
in connection with the granting of such Option or the purchase or delivery of
shares thereunder, the delivery of any or all shares pursuant to such Option may
be withheld unless and until such listing, registration or qualification shall
have been effected. If a
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registration statement is not in effect under the Securities Act of 1933, as
amended (the "Act"), or any applicable state securities laws with respect to the
shares of Stock purchasable or otherwise deliverable under Options then
outstanding, the Committee may require, as a condition of exercise of any
Option, that the Option holder or other recipient of an Option represent, in
writing, that the shares received pursuant to the Option are being acquired for
investment and not with a view to distribution and agree that the shares will
not be disposed of except pursuant to an effective registration statement,
unless the Company shall have received an opinion of counsel that such
disposition is exempt from such requirement under the Act and any applicable
state securities laws. The Company may endorse on certificates representing
shares delivered pursuant to an Option such legends referring to the foregoing
representation or restrictions or any other applicable restrictions on resale as
the Company, in its discretion, shall deem appropriate.
(b) Nontransferability. Except to the extent provided
otherwise in the applicable Option Agreement, Options shall not be transferable
by a Participant except by will or the laws of descent and distribution and
shall be exercisable during the lifetime of a Participant only by such
Participant or his guardian or legal representative.
(c) No Right To Continued Employment. Nothing in the Plan or
in any Option granted or any Option Agreement or other agreement entered into
pursuant hereto shall confer upon any Participant the right to continue in the
employ of the Company or to be entitled to any remuneration or benefits not set
forth in the Plan or such Option Agreement or other agreement or to interfere
with or limit in any way the right of the Company to terminate such
Participant's employment.
(d) Withholding Taxes. Where a Participant or other person is
entitled to receive shares of Common Stock pursuant to an Option hereunder, the
Company shall have the right to require the Participant or such other person to
pay to the Company the amount of any taxes which the Company may be required to
withhold before delivery to such Participant or other person of cash or a
certificate or certificates representing such shares. Unless otherwise
prohibited by applicable law, a Participant may satisfy any such withholding tax
obligation by either of the following methods, or by a combination of such
methods: (a) tendering a cash payment; or (b) delivering to the Company
previously acquired shares of Common Stock having an aggregate Fair Market
Value, determined as of the date the withholding tax obligation arises, less
than or equal to the amount of the total withholding tax obligation.
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(e) Amendment and Termination of the Plan. The Board or the
Committee may at any time and from time to time alter, amend, suspend, or
terminate the Plan in whole or in part; provided that, no amendment which
requires stockholder approval under applicable law or in order for the Plan to
continue to comply with Code Section 162(m) shall be effective unless the same
shall be approved by the requisite vote of the stockholders of the Company.
Notwithstanding the foregoing, no amendment shall affect adversely any of the
rights of any Participant, without such Participant's consent, under any Option
theretofore granted under the Plan. The power to grant Options under the Plan
will automatically terminate ten years after the adoption of the Plan by the
Board. If the Plan is terminated, any unexercised Option shall continue to be
exercisable in accordance with its terms and the terms of the Plan in effect
immediately prior to such termination.
(f) Participant Rights. No Participant shall have any claim to
be granted any Option under the Plan, and there is no obligation for uniformity
of treatment for Participants. Except as provided specifically herein, a
Participant or a transferee of an Option shall have no rights as a stockholder
with respect to any shares covered by any Option until the date of the issuance
of a stock certificate to him for such shares.
(g) No Fractional Shares. No fractional shares of Common Stock
shall be issued or delivered pursuant to the Plan or any Option. The Committee
shall determine whether cash, other Options, or other property shall be issued
or paid in lieu of such fractional shares or whether such fractional shares or
any rights thereto shall be forfeited or otherwise eliminated.
(h) Governing Law. The Plan and all determinations made and
actions taken pursuant hereto shall be governed by the laws of the State of
Wisconsin without giving effect to the conflict of laws principles thereof.
(i) Headings. The section and subsection headings contained
herein are for convenience only and shall not affect the construction hereof.
9. Effectiveness.
The Plan shall take effect upon its adoption by the Board.
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