EXHIBIT 10.14
M.D.C. HOLDINGS, INC.
STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
NON-QUALIFIED STOCK OPTION AGREEMENT
This Non-Qualified Stock Option Agreement (the "Agreement") is made as of
this_____ day of __________, 2001 between M.D.C. Holdings, Inc., a Delaware
corporation (the "Company"), and__________ (the "Option Holder").
WHEREAS, pursuant to the M.D.C. Holdings, Inc. Stock Option Plan for
Non-Employee Directors, established effective March 26, 2001 (the "Plan"), the
Company wishes to grant the Option Holder an option to purchase shares of the
$0.01 par value common stock of the Company (the "Stock") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in connection with the mutual covenants hereinafter set forth
and for other good and valuable consideration, the receipt and adequacy of which
is hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS AND CONFLICTS.
Capitalized terms used and not otherwise defined herein shall have the meanings
given thereto in the Plan. The terms and provisions of the Plan are incorporated
herein by reference. Except as specifically otherwise provided herein, in the
event of a conflict or inconsistency between the terms and provisions of the
Plan and the terms and provisions of this Agreement, the terms and provisions of
the Plan shall govern and control.
2. GRANT OF OPTION.
The Company hereby grants to the Option Holder the right and option (the
"Option") to purchase up to________shares of Stock, subject to the terms and
conditions of this Agreement and subject to adjustment from time to time to
reflect changes in the Stock (through merger, consolidation, reorganization,
recapitalization, stock split, liquidating dividend, combination of shares,
exchange of shares, changes in corporate structure or otherwise), as provided in
Article IV of the Plan.
3. PURCHASE PRICE AND GRANT DATE.
The purchase price of each share of Stock covered by the Option shall be $
____________(the "Purchase Price"). The date of the grant of the Option is
______________(the "Date of Grant").
4. EXPIRATION AND TERMINATION OF THE OPTION.
The Option shall expire on the tenth (10th) anniversary of the Date of Grant
(the period from the Date of Grant to the expiration date is the "Option
Period") or prior to such time as follows:
(a) If the Option Holder is removed as a director of the Company during
the Option Period for cause (as determined by the Board of Directors
of the Company in its absolute discretion), the Option shall be void
thereafter for all purposes.
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(b) If the Option Holder dies during the Option Period while serving as
a director, the Option may be exercised by those empowered to do so
under the Option Holder's will or by the then applicable laws of
descent and distribution within twelve months following the Option
Holder's death (if otherwise within the Option Period), but not
thereafter.
5. METHOD OF EXERCISING OPTION.
Subject to the terms and conditions of this Agreement, the Option may be
exercised by written notice to the Company, Attention: General Counsel. Such
notice shall state the election to exercise the Option, the number of shares of
Stock with respect to which the Option is being exercised, and shall be signed
by the person or persons exercising the Option. If the Option is exercised by
any person or persons other than the director to whom the Option was originally
granted, appropriate proof of the right of such person or persons to exercise
the Option or portion thereof shall be provided. The purchase of the Stock
pursuant to the Option shall take place at the principal office of the Company
within 3 days following delivery of such notice, at which time the Purchase
Price of the Stock shall be paid in full.
Payment of the Purchase Price may be made in any of the following methods or in
any combination of such methods, at the option of the Option Holder: (a) cash;
(b) certified check, cashier's check, or other check acceptable to the Company,
payable to the order of the Company; (c) delivery to the Company of irrevocable
instructions to a broker (to the extent permissible under applicable law) to
deliver promptly to the Company the amount of sale or loan proceeds required to
pay the Purchase Price of the Stock (a "cashless exercise" or "same-day sale"
transaction) or (d) delivery to the Company of certificates representing the
number of shares of Stock then owned by the Option Holder, the Fair Market Value
of which (determined as of the date the notice of exercise is delivered to the
Company) equals the price of the Stock to be purchased pursuant to the Option,
properly endorsed for transfer to the Company. No Option may be exercised by
delivery to the Company of certificates representing Stock unless such Stock has
been held by the Option Holder for more than six months.
Upon notice to the Company of exercise of the Option and payment of the Purchase
Price, the exercise of the Option shall be deemed to be effective, and a
properly executed certificate or certificates representing the Stock so
purchased shall be issued by the Company and delivered to the Option Holder.
6. TRANSFERABILITY OF OPTIONS.
In general, an Option Holder may not voluntarily or involuntarily pledge,
hypothecate, assign, sell or otherwise transfer the Option except by will or the
laws of descent and distribution, and during the Option Holder's lifetime, the
Option shall be exercisable only by the Option Holder. Notwithstanding the
preceding sentence, the Board of Directors of the Company may provide at the
time of grant of an Option or thereafter that the Option Holder may transfer an
Option to a member of the Option Holder's immediate family, a trust of which
members of the Option Holder's immediate family are the only beneficiaries, a
partnership of which members of the Option Holder's immediate family or trusts
for the sole benefit of the Option Holder's immediate family are the only
partners, a corporation in which members of the Option Holder's immediate family
are the only shareholders, a limited liability company in which members of the
Option
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Holder's immediate family are the only members, or any other entity which is
solely owned by members of the Option Holder's immediate family (the "InterVivos
Transferee"). Immediate family member means the Option Holder and the Option
Holder's spouse, children (by birth or adoption), stepchild, grandchild,
parents, stepparents, grandparents, siblings, nieces, nephews, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law. No
transfer shall be effective unless the Option Holder has notified the Board of
Directors of the transfer in writing and has furnished a copy of the documents
that effect the transfer to the Board of Directors. The InterVivos Transferee
will be subject to all of the terms of the Plan and the Stock Option Agreement.
7. CORPORATE TRANSACTION/CHANGE OF CONTROL.
(a) In the event of a Corporate Transaction, as defined in
Section 5.3 of the Plan, the Board of Directors of the Company may
take certain actions in connection with outstanding Options,
including but not limited to (1) providing for the assumption of the
outstanding Options or the substitution of new options for the
outstanding Options on terms comparable to the outstanding Options,
(2) providing that any Options outstanding at the time the Corporate
Transaction is closed will be canceled, and the director holding
such cancelled Option shall receive in exchange therefor a cash
payment equal to the greater of (i) the Fair Market Value (as
determined under Section 6.5 of the Plan) of a share of Stock
measured on the date immediately prior to such Transaction less the
per share exercise price set forth in the director's Option,
multiplied by the number of shares of Stock purchasable under the
Option; or (ii) the fair market value, as determined by the Board of
Directors of the Company, of the cash, securities or other
consideration into which a share of Stock is to be exchanged
pursuant to the Corporate Transaction, less the exercise price set
forth in the director's Option, multiplied by the number of shares
of Stock purchasable under the Option, or (3) making any other
provision for outstanding Options as the Board of Directors of the
Company deems appropriate.
(b) Notwithstanding the foregoing, actions may be taken
pursuant to subsection (a) hereof only to the extent that any
payments made with respect to the director continue to be deductible
by the Company under Section 280G of the Internal Revenue Code of
1986, as amended (the "Code").
8. NO RIGHTS AS A STOCKHOLDER.
The Option Holder shall have no rights as a stockholder with respect to any
shares of Stock until the date of issuance to the Option Holder of a certificate
evidencing such shares of Stock. No adjustments, other than as provided for in
Article IV of the Plan, shall be made for dividends (ordinary or extraordinary,
whether in cash, securities or other property) or distributions for which the
record date is prior to the date the certificate for such shares of Stock is
issued.
9. CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES.
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(a) Stock will not be issued with respect to the Option granted
hereunder unless the exercise of the Option and the issuance and
delivery of the shares of Stock pursuant thereto complies with all
relevant provisions of law, including the laws of the Company's
state of incorporation, the Securities Act of 1933, the Securities
Exchange Act of 1934, the rules and regulations thereunder and the
requirements of any stock exchange upon which the Stock may then be
listed, and shall be further subject to the approval of the
Company's counsel with respect to such compliance.
(b) The Plan, this Agreement and the grant and exercise of the
Option to purchase shares of Stock hereunder, and the Company's
obligation to sell and deliver shares upon the exercise of rights to
purchase shares, shall be subject to all applicable federal and
state laws, rules and regulations, and to such approvals by any
regulatory or governmental agency which may, in the opinion of the
counsel for the Company, be required.
10. INCOME TAX WITHHOLDING.
The Company may make such provisions and take such steps as it may deem
necessary or appropriate for the withholding of all federal, state, local and
other taxes required by law to be withheld, if any, with respect to the exercise
of the Option and the issuance of the Stock, including, but not limited to,
deducting the amount of any such withholding taxes from any other amount then or
thereafter payable to the Option Holder, or requiring the Option Holder to pay
to the Company the amount required to be withheld or to execute such documents
as the Company deems necessary or desirable to enable it to satisfy any
withholding obligations.
11. NO RIGHT TO CONTINUED MEMBERSHIP ON THE BOARD.
Nothing in this Agreement or in the Plan confers upon a director any right to
continue as a director of the Company or shall interfere with or restrict in any
way the rights of the Company and its stockholders to remove any director at any
time for any reason whatsoever, with or without cause.
12. NON-QUALIFIED STOCK OPTION.
The Option granted hereunder is not intended to be an "incentive stock option"
within the meaning of Section 422 of the Code.
13. ADMINISTRATION.
The Board of Directors of the Company has the power to interpret the Plan and
this Agreement, including the power to correct any defect, supply any omission
or reconcile any inconsistency in the Plan or in this Agreement, and to
determine the rights of all directors and other interested persons hereunder.
All actions taken and interpretations and determinations made by the Board of
Directors in connection with the Plan and this Agreement shall be final and
binding on the director to whom the Option is granted, the Company, and all
other interested persons.
14. BINDING EFFECT.
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This Agreement shall be binding upon the heirs, executors, administrators and
successors of the parties hereto.
15. GOVERNING LAW.
This Agreement shall be construed and interpreted in accordance with the laws of
the State of Delaware.
16. HEADINGS.
Headings are for the convenience of the parties and are not deemed to be part of
this Agreement.
17. EXECUTION.
This Agreement is voidable by the Company if the Option Holder does not execute
the Agreement within 30 days after the Agreement is sent to the Option Holder by
the Company.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first written above.
M.D.C. HOLDINGS, INC.
By: _________________________________________
Title:_________________________________________
OPTION HOLDER:
_______________________________________________
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