Exhibit 10.2
N Option R
1998 - SFG
NABISCO HOLDINGS CORP.
1994 LONG TERM INCENTIVE PLAN
STOCK OPTION AGREEMENT
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DATE OF GRANT: JANUARY 15, 1998
W I T N E S S E T H :
1. GRANT OF OPTION. Subject to (i) the terms and conditions herein and
(ii) the provisions of the Nabisco Holdings Corp. 1994 Long Term Incentive Plan
(the "Plan"), Nabisco Holdings Corp. (the "Company") on the above date has
granted to
STEVEN F. GOLDSTONE (THE "OPTIONEE"),
the right and option to exercise from the Company a total of
100,000 SHARES
of Class A Common Stock of the Company ("Common Stock"), at the exercise price
of $47.625 per share (the "Option"). A copy of the Plan is attached and made a
part of this agreement with same effect as if set forth in the agreement itself.
All capitalized terms used herein shall have the meaning set forth in the Plan,
unless the context requires a different meaning.
2. EXERCISE OF OPTION.
(a) Shares may be purchased by giving the Corporate Secretary of the
Company written notice of exercise, on a form prescribed by the Company,
specifying the number of shares to be purchased. The notice of exercise shall
be accompanied by
(i) tender to the Company of cash for the full purchase price of the
shares with respect to which such Option or portion thereof is
exercised; OR
(ii) the unsecured, demand borrowing by the Optionee from the Company on an
open account maintained solely for this purpose in the amount of the
full exercise price together with the instruction from the Optionee to
sell the shares exercised on the open market through a duly registered
broker-dealer with which the Company makes an arrangement for the sale
of such shares under the Plan. This method is known as the
"broker-dealer
exercise method" and is subject to the terms and conditions set forth
herein, in the Plan and in guidelines established by the Committee.
The Option shall be deemed to be exercised simultaneously with the
sale of the shares by the broker-dealer. If the shares purchased upon
the exercise of an Option or a portion thereof cannot be sold for a
price equal to or greater than the full exercise price plus direct
costs of the sales, then there is no exercise of the Option. Election
of this method authorizes the Company to deliver shares to the
broker-dealer and authorizes the broker-dealer to sell said shares on
the open market. The broker-dealer will remit proceeds of the sale to
the Company which will remit net proceeds to the Optionee after
repayment of the borrowing, deduction of costs, if any, and
withholding of taxes. The Optionee's borrowing from the Company on an
open account shall be a personal obligation of the Optionee which
shall bear interest at the published Applicable Federal Rate (AFR) for
short-term loans and shall be payable upon demand by the Company.
Such borrowing may be authorized by telephone or other
telecommunications acceptable to the Company. Upon such borrowing and
the exercise of the Option or portion thereof, title to the shares
shall pass to the Optionee whose election hereunder shall constitute
instruction to the Company to register the shares in the name of the
broker-dealer or its nominee. The Company reserves the right to
discontinue this broker-dealer exercise method at any time for any
reason whatsoever. The Optionee agrees that if this broker-dealer
exercise method under this paragraph is used, the Optionee promises
unconditionally to pay the Company the full balance in his open
account at any time upon demand. Optionee also agrees to pay interest
on the account balance at the AFR for short-term loans from and after
demand.
(b) Notwithstanding provisions for regular exercise, if more than 80% of
the aggregate value of all classes of Company common stock is owned, directly or
indirectly, by RJR Nabisco Holdings Corp. on the date of exercise then the
Company may, in its absolute discretion, make a cash payment to the Optionee,
net of taxes, equal to the product of (x) and (y), where (x) is the excess of
the fair market value of Common Stock on the date of exercise over the exercise
price, and (y) is the number of shares subject to the Option(s) being exercised.
Such cash payment shall be in lieu of delivery of shares.
(c) Subject to Sections 2(b), 2(d), and 4, this Option shall be vested in
three installments. The first installment shall be vested on the 1st of January
following the Date of Grant for 33% of the number of shares of Common Stock
subject to this Option. Thereafter, on each subsequent January 1st an
installment shall become vested for 33% and 34%, respectively, of the number of
shares subject to this Option until the Option has become fully vested. To the
extent that any portion of the Option is not exercised, it shall not expire, but
shall continue to be vested at any time thereafter until this Option shall
terminate, expire or be surrendered. An exercise shall be for whole shares
only.
(d) This Option shall not be exercised prior to 36 months after the Date
of Grant.
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3. RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT.
Subject to Sections 2(b), 2(d) and 4:
(a) Unless otherwise provided in a written employment or termination
agreement between the Optionee and the Company, the Option shall not become
vested as to any additional shares following the Termination of Employment of
the Optionee for any reason other than a Termination of Employment because of
death, Permanent Disability, Retirement, Termination of Employment by the
Optionee with Good Reason or involuntary Termination of Employment of the
Optionee without Cause. In the event of the Optionee's Termination of
Employment because of any of the foregoing reasons, the Option shall immediately
become vested as to all shares.
(b) The Optionee shall be deemed to have a "Permanent Disability" if he
becomes totally and permanently disabled (as defined in RJR Nabisco, Inc's Long
Term Disability Plan applicable to senior executive officers as in effect on the
date hereof), or if the Board of Directors or any committee thereof so
determines.
(c) "Retirement" as used herein means retirement at age 65 or over, or
early retirement at age 55 or over with the approval of the Company, which
approval specifically states that the Option shall become fully exercisable as
to all Shares.
(d) "Termination of Employment" as used herein means termination from
active employment with the Company and any other entity which, as of the date of
this Agreement, is an affiliate of the Company.
4. EXPIRATION OF OPTION. The Option shall expire or terminate and may not
be exercised to any extent by the Optionee after the first to occur of the
following events:
(a) The tenth anniversary of the Date of Grant, or such earlier time as
the Company may determine is necessary or appropriate in light of applicable
foreign tax laws; or
(b) Immediately upon the Optionee's Termination of Employment for Cause
(as defined in Section 11 herein).
5. TRANSFERABILITY. Other than as specifically provided with regard to
the death of the Optionee, this Option agreement and any benefit provided or
accruing hereunder shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge; and any
attempt to do so shall be void. No such benefit shall, prior to receipt thereof
by the Optionee, be in any manner liable for or subject to the debts, contracts,
liabilities, engagements or torts of the Optionee.
6. NO RIGHT TO EMPLOYMENT. Neither the execution and delivery of this
agreement nor the granting of the Option evidenced by this agreement shall
constitute or
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be evidence of any agreement or understanding, express or implied, on the part
of the Company or its subsidiaries to employ the Optionee for any specific
period or shall prevent the Company or its subsidiaries from terminating the
Optionee's employment at any time with or without "Cause" (as defined in Section
11 herein).
7. ADJUSTMENTS IN OPTION. In the event that the outstanding shares of the
Common Stock subject to the Option are, from time to time, changed into or
exchanged for a different number or kind of shares of the Company or other
securities by reason of a merger, consolidation, recapitalization,
reclassification, stock split, stock dividend, combination of shares, or
otherwise, the Committee may make an appropriate and equitable adjustment in the
number and kind of shares or other consideration as to which the Option, or
portions thereof then unexercised, shall be exercisable. Any adjustment made by
the Committee shall be final and binding upon the Optionee, the Company and all
other interested persons.
8. APPLICATION OF LAWS. The granting and the exercise of this Option and
the obligations of the Company to sell and deliver shares hereunder and to remit
cash under the broker-dealer exercise method shall be subject to all applicable
laws, rules, and regulations and to such approvals of any governmental agencies
as may be required.
9. TAXES. Any taxes required by federal, state, or local laws to be
withheld by the Company (i) on exercise by the Optionee of the Option for Common
Stock, or (ii) at the time an election, if any, is made by the Optionee pursuant
to Section 83(b) of the Internal Revenue Code, as amended, shall be paid to the
Company before delivery of the Common Stock is made to the Optionee. When the
Option is exercised under the broker-dealer exercise method, the full amount of
any taxes required to be withheld by the Company on exercise of stock options
shall be deducted by the Company from the proceeds.
10. NOTICES. Any notices required to be given hereunder to the Company
shall be addressed to The Secretary, Nabisco Holdings Corp., 7 Campus Drive,
Parsippany, New Jersey 07054, and any notice required to be given hereunder to
the Optionee shall be sent to the Optionee's address as shown on the records of
the Company.
11. TERMINATION FOR "CAUSE" OR WITH "GOOD REASON". For purposes of this
Agreement, the Optionee's employment shall be deemed to have been terminated for
"Cause" or with "Good Reason" only as such terms are defined and applied in the
Optionee's employment agreement with the Company. Any voluntary termination by
the Optionee in anticipation of an involuntary termination of the Optionee's
employment for Cause shall be deemed to be a termination of Optionee's
employment for Cause.
12. ADMINISTRATION AND INTERPRETATION. In consideration of the grant, the
Optionee specifically agrees that the Committee shall have the exclusive power
to interpret the Plan and this Agreement and to adopt such rules for the
administration, interpretation and application of the Plan and Agreement as are
consistent therewith and to interpret or revoke any such rules. All actions
taken and all interpretations and determinations made
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by the Committee shall be final, conclusive, and binding upon the Optionee, the
Company and all other interested persons. No member of the Committee shall be
personally liable for any action, determination or interpretation made in good
faith with respect to the Plan or the Agreement. The Committee may delegate its
interpretive authority to an officer or officers of the Company.
13. OTHER PROVISIONS.
a) Titles are provided herein for convenience only and are not to
serve as a basis for interpretation of the Agreement.
b) This Agreement may be amended only by a writing executed by the
parties hereto which specifically states that it is amending this Agreement.
c) THE LAWS OF THE STATE OF DELAWARE SHALL GOVERN THE
INTERPRETATION, VALIDITY AND PERFORMANCE OF THE TERMS OF THIS AGREEMENT
REGARDLESS OF THE LAW THAT MIGHT BE APPLIED UNDER PRINCIPLES OF CONFLICTS OF
LAWS.
IN WITNESS WHEREOF, the Company, by its duly authorized officer, and the
Optionee have executed this Agreement as of the date of Grant first above
written.
NABISCO HOLDINGS CORP.
By
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Authorized Signatory
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Optionee
Optionee's Taxpayer Identification Number:
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Optionee's Home Address:
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