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EXHIBIT 10.24
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THE XXXXXXX XXXXX 1999 STOCK INCENTIVE PLAN
1999 DISCRETIONARY OPTION AWARD
This Award Agreement sets forth the terms and conditions of an Award
granted to you under The Xxxxxxx Xxxxx 1999 Stock Incentive Plan (the "Plan"),
of options ("Options") to purchase shares of Common Stock ("Shares").
1. The Plan. This Award is made pursuant to the Plan, the terms of
which are incorporated in this Award Agreement. Capitalized terms used in this
Award Agreement which are not defined in this Award Agreement, or in the
attached Glossary of Terms, have the meanings as used or defined in the Plan.
2. Award. A statement separately delivered to you sets forth (i) the
date of grant of the Options (the "Date of Grant"), (ii) the number of Shares
underlying the Options, and (iii) the exercise price of each Option (the
"Exercise Price"). Until the Shares are delivered to you pursuant to Paragraph
6, you have no rights as a shareholder of GS Inc. THIS AWARD IS SUBJECT TO ALL
TERMS AND PROVISIONS OF THE PLAN AND THIS AWARD AGREEMENT, INCLUDING, WITHOUT
LIMITATION, THE ARBITRATION AND CHOICE OF FORUM PROVISIONS SET FORTH IN
PARAGRAPH 15. BY OPENING THE CUSTODY ACCOUNT REFERRED TO IN PARAGRAPH 6, YOU
WILL HAVE CONFIRMED YOUR ACCEPTANCE OF THE TERMS AND CONDITIONS OF THIS AWARD
AGREEMENT.
3. Expiration Date. Notwithstanding anything to the contrary in this
Award Agreement, the Options shall expire and no longer be exercisable on the
tenth anniversary of the Date of Grant (the "Expiration Date"), subject to
earlier termination as provided in this Award Agreement, or otherwise in
accordance with the Plan.
4. Vesting.
(a) In General. Except as provided below in Paragraphs 4(b) and
4(c), the Options shall vest in equal installments (subject to rounding in the
discretion of the Committee to avoid the vesting of fractional options) on each
Vesting Date.
(b) Death. Notwithstanding any other provision of this Award
Agreement, if you die prior to the last Vesting Date, and provided your rights
in respect of the outstanding Options have not previously terminated, any
Options that have not vested shall immediately vest.
(c) Termination of Options Upon Certain Events. Unless the Committee
determines otherwise, and except as provided in Paragraph 5(f), your rights in
respect of any outstanding unvested Options shall immediately terminate if:
(i) at any time prior to the relevant Vesting Date:
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(A) your Employment with the Firm is terminated for any reason, or
you are otherwise no longer actively employed with the Firm (except as
provided in Paragraphs 4(b) or 4(d)); or
(B) any of the items that constitute Cause have occurred; or
(C) you attempt to have any dispute under this Award Agreement
resolved in any manner that is not provided for by Paragraph 15; or
(ii) you fail to certify to GS Inc., in accordance with procedures
established by the Committee, with respect to each relevant Vesting Date
that you have complied, or the Committee determines that you in fact have
failed as of the relevant Vesting Date to comply, with all the terms and
conditions of this Award Agreement.
(d) Extended Absence and Retirement.
(i) If your Employment with the Firm is terminated by reason of
Extended Absence or Retirement, and provided your rights with respect to any
outstanding unvested Options have not previously terminated, the condition set
forth in Paragraph 4(c)(i)(A) shall be waived but all other conditions of this
Award Agreement shall continue to apply.
(ii) Without limiting the application of Paragraphs 4(c)(i)(B) and
(C) and Paragraph 4(c)(ii), unless the Committee determines otherwise, your
rights in respect of any outstanding unvested Options shall immediately
terminate if, following the termination of your Employment with the Firm by
reason of Extended Absence or Retirement:
(A) you (1) form, or acquire a 5% or greater equity ownership,
voting or profit participation interest in, any Competitive Enterprise, or
(2) associate (including, but not limited to, association as an officer,
employee, partner, director, consultant, agent or advisor) with any
Competitive Enterprise and in connection with such association engage in,
or directly or indirectly manage or supervise personnel engaged in, any
activity (x) which is similar or substantially related to any activity in
which you were engaged, in whole or in part, at the Firm, (y) for which
you had direct or indirect managerial or supervisory responsibility at the
Firm or (z) which calls for the application of the same or similar
specialized knowledge or skills as those utilized by you in your
activities with the Firm, at any time during the one-year period
immediately prior to termination of your Employment (or, in the case of an
action taken prior to termination of your Employment, during the one-year
period immediately prior to such action), and, in any such case,
irrespective of the purpose of the activity or whether the activity is or
was in furtherance of advisory, agency, proprietary or fiduciary business
of either the Firm or the Competitive Enterprise. (By way of example only,
this provision would preclude an "advisory" investment banker from joining
a leveraged-buyout firm, a research analyst from becoming a proprietary
trader or joining a hedge fund, or an information systems professional
from joining a management or other consulting firm and providing
information technology consulting services or advice to any Competitive
Enterprise.); or
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(B) you in any manner, directly or indirectly, (1) Solicit any
Client to transact business with a Competitive Enterprise or to reduce or
refrain from doing any business with the Firm or (2) interfere with or
damage (or attempt to interfere with or damage) any relationship between
the Firm and any such Client or (3) Solicit any person who is an employee
of the Firm to resign from the Firm or to apply for or accept employment
with any Competitive Enterprise.
5. Exercisability of Vested Options.
(a) Options that are not vested may not be exercised. Vested Options
may be exercised in accordance with procedures established by the Committee. The
Committee may from time to time prescribe periods during which the vested
Options shall not be exercisable.
(b) Unless the Committee determines otherwise, and except as
provided in Paragraph 5(f), any outstanding vested Options shall cease to be
exercisable, and your rights in respect of such Options shall immediately
terminate, if prior to the exercise of such Options:
(i) any of the events specified in Paragraph 4(c)(i)(B) or (C), or
Paragraph 4(d)(ii)(A) or (B), have occurred; or
(ii) you fail to certify to GS Inc., in accordance with procedures
established by the Committee, with respect to each Option exercise date
that you have complied, or the Committee determines that you in fact have
failed as of such Option exercise date to comply, with all the terms and
conditions of this Award Agreement. By accepting the delivery of Shares
upon exercise of any Options, you shall be deemed to have represented and
certified at such time that you have complied with all the terms and
conditions of this Award Agreement.
(c) Death. If you die, provided your rights in respect of the vested
Options have not previously terminated, any outstanding vested Options shall be
exercisable by your designated beneficiary, or, if none, the persons determined
by the Committee in accordance with Paragraph 8, for a period of one year
following the date of your death, but in no event later than the Expiration
Date, and shall thereafter terminate.
(d) Extended Absence and Retirement. If your Employment with the
Firm is terminated by reason of Extended Absence or Retirement, and provided
your rights in respect of any outstanding Options have not previously
terminated, then the Options, to the extent such Options are or become vested,
shall be exercisable (subject to the satisfaction of all terms and conditions of
this Award Agreement, including Paragraph 5(b)) until the later of (i) the
expiration of the one-year period following the last Vesting Date, or (ii) the
expiration of the one-year period following the date of your termination of
Employment, but in no event later than the Expiration Date, and shall thereafter
terminate.
(e) Other Terminations. Except as provided in Paragraph 5(f), upon
the termination of your Employment for any reason other than death, Cause,
Extended Absence or Retirement, any vested Options shall remain exercisable
(subject to the satisfaction of all terms and conditions of this Award
Agreement, including Paragraph 5(b)) for 90 days following such termination of
Employment (or
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if you die within such 90-day period, for one year from your date of death), but
in no event later than the Expiration Date, and shall thereafter terminate.
(f) Change in Control. Notwithstanding anything to the contrary in
this Award Agreement, in the event a Change in Control shall occur and within 18
months thereafter the Firm terminates your Employment without Cause or you
terminate Employment with the Firm for Good Reason, any unvested Options with
respect to which your rights have not terminated shall vest and all unexercised
outstanding Options shall be exercisable for a period of one year following such
termination of Employment, but in no event later than the Expiration Date, and
shall thereafter terminate.
6. Delivery. Unless otherwise determined by the Committee, or as
otherwise provided in this Award Agreement, and except as provided in Paragraphs
9 and 10, upon receipt of payment of the Exercise Price for Shares subject to
Options, delivery of Shares shall be effected by book-entry credit to a custody
account (the "Custody Account") maintained by you with The Chase Manhattan Bank
or such successor custodian as may be designated by GS Inc. No delivery of
Shares shall be made unless you have timely established the Custody Account. You
shall be the beneficial owner of any Shares properly credited to the Custody
Account. You shall have no right to any dividend or distribution with respect to
such Shares if the record date for such dividend or distribution is prior to the
date the Custody Account is properly credited with such Shares. The Firm may
deliver cash in lieu of all or any portion of the Shares otherwise deliverable
in accordance with this Paragraph 6.
7. Repayment. If, following the exercise of any Options, the
Committee determines that all terms and conditions of this Award Agreement in
respect of such exercise were not satisfied, the Firm shall be entitled to
receive, and you shall be obligated to pay the Firm immediately upon demand
therefor, an amount equal to the excess of the Fair Market Value (determined at
the time of exercise) of the Shares that were delivered in respect of such
exercised Options over the Exercise Price paid therefor and without reduction
for any Shares applied to satisfy withholding tax or other obligations in
respect of such Shares.
8. Non-transferability; Beneficiary Designation. Except as may
otherwise be provided by the Committee, the limitations set forth in Section 3.4
of the Plan shall apply. Any assignment (as defined in Section 3.4 of the Plan)
in violation of the provisions of this Paragraph 8 shall be void. You may
designate, in accordance with procedures established by the Committee, a
beneficiary or beneficiaries to receive all or part of the amounts to be paid
under this Award Agreement in the event of your death. A designation of a
beneficiary may be replaced by a new designation or may be revoked by you at any
time in accordance with procedures established by the Committee. In the event of
your death, such beneficiary or, if no designation of beneficiary has been made,
the legal representative of your estate, or those persons succeeding to the
rights of such legal representative, may exercise, in accordance with the terms
of this Award Agreement, any outstanding Options which are vested (including
those which have become vested under Paragraph 4(b)), exercisable and have not
expired or otherwise terminated. The determination by the Committee of the
persons entitled to exercise any Options following your death shall be binding
and conclusive on all persons. A beneficiary or estate shall have no rights
under this Award Agreement other than the right, subject to the immediately
preceding sentence, to exercise Options in accordance with this Paragraph 8.
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9. Withholding, Consents and Legends.
(a) The delivery of Shares upon exercise of Options is conditioned
on your satisfaction of any applicable withholding taxes (in accordance with
Section 3.2 of the Plan, provided that the Committee may determine not to apply
the minimum withholding rate specified in Section 3.2.2 of the Plan).
(b) Your rights in respect of the Options are conditioned on the
receipt to the full satisfaction of the Committee of any required consents (as
defined in Section 3.3 of the Plan) that the Committee may determine to be
necessary or advisable (including, without limitation, your consenting (i) to
the Firm's supplying to any third party recordkeeper of the Plan such personal
information as the Committee deems advisable to administer the Plan and (ii) to
deductions from your wages, or other arrangements satisfactory to the Committee,
to reimburse the Firm for advances made on your behalf to satisfy certain
withholding and other tax obligations in connection with this Award).
(c) If you are or become a Managing Director, your rights in respect
of the Options are conditioned on your becoming a party to any shareholders'
agreement to which other similarly situated employees of the Firm are a party.
(d) GS Inc. may affix to Certificates representing Shares issued
pursuant to this Award Agreement any legend that the Committee determines to be
necessary or advisable (including to reflect any restrictions to which you may
be subject under a separate agreement with GS Inc.). GS Inc. may advise the
transfer agent to place a stop order against any legended Xxxxxx.
10. Right of Offset. GS Inc. (and any of its affiliates or
subsidiaries) shall have the right to offset against the obligation to deliver
Shares (or cash) under this Award Agreement any outstanding amounts (including,
without limitation, travel and entertainment or advance account balances, loans,
or amounts repayable to the Firm pursuant to tax equalization, housing,
automobile or other employee programs) you then owe to the Firm and any amounts
the Committee otherwise deems appropriate pursuant to any tax equalization
policy or agreement.
11. No Rights to Continued Employment. Nothing in this Award
Agreement or the Plan shall be construed as giving you any right to continued
Employment by the Firm or affect any right which the Firm may have to terminate
or alter the terms and conditions of your Employment.
12. Successors and Assigns of GS Inc. The terms and conditions of
this Award Agreement shall be binding upon and shall inure to the benefit of GS
Inc. and its successors and assigns.
13. Committee Discretion. The Committee shall have full discretion
with respect to any actions to be taken or determinations to be made in
connection with this Award Agreement, and its determinations shall be final,
binding and conclusive.
14. Amendment. The Committee reserves the right at any time to amend
the terms and conditions set forth in this Award Agreement, and the Board may
amend the Plan in any respect;
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provided that, notwithstanding the foregoing and Sections 1.3.2(f), 1.3.2(g) and
Section 3.1 of the Plan, no such amendment shall materially adversely affect
your rights and obligations under this Award Agreement without your consent (or
the consent of your beneficiary or estate, if applicable), except that the
Committee reserves the right to accelerate the vesting of the Options and in its
discretion provide that Shares acquired pursuant to the exercise of Options may
not be transferable until the relevant Vesting Dates (and that in respect of
such Shares you may remain subject to the repayment obligations of Paragraph 7
in the circumstances under which the Option would not have vested or become
exercisable pursuant to Sections 4 or 5). Any amendment of this Award Agreement
shall be in writing signed by the Chief Executive Officer of GS Inc. or his or
her designee.
15. Arbitration; Choice of Forum. (a) Any dispute, controversy or
claim between the Firm and you, arising out of or relating to or concerning the
Plan or this Award Agreement, shall be finally settled by arbitration in New
York City before, and in accordance with the rules then obtaining of, the New
York Stock Exchange, Inc. (the "NYSE") or, if the NYSE declines to arbitrate the
matter, the American Arbitration Association (the "AAA") in accordance with the
commercial arbitration rules of the AAA. Prior to arbitration, all claims
maintained by you must first be submitted to the Committee in accordance with
claims procedures determined by the Committee. This paragraph is subject to the
provisions of clauses (b) and (c) below.
(b) THE FIRM AND YOU HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN THE CITY OF NEW YORK OVER
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO OR CONCERNING THE
PLAN OR THIS AWARD AGREEMENT THAT IS NOT OTHERWISE ARBITRATED OR RESOLVED
ACCORDING TO PARAGRAPH 15(a) OF THIS AWARD AGREEMENT. This includes any suit,
action or proceeding to compel arbitration or to enforce an arbitration award.
The Firm and you acknowledge that the forum designated by this Paragraph 15(b)
has a reasonable relation to the Plan, this Award Agreement, and to your
relationship with the Firm. Notwithstanding the foregoing, nothing herein shall
preclude the Firm from bringing any action or proceeding in any other court for
the purpose of enforcing the provisions of this Paragraph 15.
(c) The agreement by you and the Firm as to forum is independent of
the law that may be applied in the action, and you and the Firm agree to such
forum even if the forum may under applicable law choose to apply non-forum law.
You and the Firm hereby waive, to the fullest extent permitted by applicable
law, any objection which you or the Firm now or hereafter may have to personal
jurisdiction or to the laying of venue of any such suit, action or proceeding in
any court referred to in Paragraph 15(b). You and the Firm undertake not to
commence any action arising out of or relating to or concerning this Award
Agreement in any forum other than a forum described in this Paragraph 15. You
and the Firm agree that, to the fullest extent permitted by applicable law, a
final and non-appealable judgment in any such suit, action or proceeding in any
such court shall be conclusive and binding upon you and the Firm.
(d) You irrevocably appoint the General Counsel of GS Inc. as your
agent for service of process in connection with any action or proceeding arising
out of or relating to or concerning
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this Award Agreement which is not arbitrated pursuant to the provisions of
Paragraph 15(a), who shall promptly advise you of any such service of process.
(e) You hereby agree to keep confidential the existence of, and any
information concerning, a dispute described in this Paragraph 15, except that
you may disclose information concerning such dispute to the arbitrator or court
that is considering such dispute or to your legal counsel (provided that such
counsel agrees not to disclose any such information other than as necessary to
the prosecution or defense of the dispute).
(f) You recognize and agree that prior to the grant of this Award
you have no right to any benefits hereunder. Accordingly, in consideration of
the receipt of this Award, you expressly waive any right to contest the amount
of this Award, terms of this Award Agreement, any determination, action or
omission hereunder or under the Plan by the Committee, GS Inc. or the Board, or
any amendment to the Plan or this Award Agreement (other than an amendment to
which your consent is expressly required by Paragraph 14).
16. Governing Law. THIS AWARD SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICT OF LAWS.
17. Headings. The headings in this Award Agreement are for the
purpose of convenience only and are not intended to define or limit the
construction of the provisions hereof.
IN WITNESS WHEREOF, GS Inc. has caused this Award Agreement to be
duly executed and delivered as of __________, 1999.
THE XXXXXXX XXXXX GROUP, INC.
By: ____________________________
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GLOSSARY OF TERMS
Solely for purposes of the 1999 Discretionary RSU Award Agreement and the
1999 Discretionary Option Award Agreement, granted under the Xxxxxxx Xxxxx
1999 Stock Incentive Plan (the "Plan"), the following terms shall have the
meanings set forth below. Capitalized terms not defined in this Glossary
of Terms shall have the meanings as used or defined in the applicable
Award Agreement or the Plan.
"CAUSE" means (i) your conviction, whether following trial or by
plea of guilty or nolo contendere (or similar plea), in a criminal
proceeding (A) on a misdemeanor charge involving fraud, false statements
or misleading omissions, wrongful taking, embezzlement, bribery, forgery,
counterfeiting or extortion, or (B) on a felony charge or (C) on an
equivalent charge to those in clauses (A) and (B) in jurisdictions which
do not use those designations; (ii) your engaging in any conduct which
constitutes an employment disqualification under applicable law (including
statutory disqualification as defined under the Exchange Act); (iii) your
willful or grossly negligent failure to perform your duties to the Firm;
(iv) your violation of any securities or commodities laws, any rules or
regulations issued pursuant to such laws, or the rules and regulations of
any securities or commodities exchange or association of which GS Inc. or
any of its subsidiaries or affiliates is a member; (v) your violation of
any Firm policy concerning hedging or confidential or proprietary
information, or your material violation of any other Firm policy as in
effect from time to time; (vi) your engaging in any act or making any
statement which impairs, impugns, denigrates, disparages or negatively
reflects upon the name, reputation or business interests of the Firm; or
(vii) your engaging in any conduct detrimental to the Firm. The
determination as to whether "Cause" has occurred shall be made by the
Committee in its sole discretion. The Committee shall also have the
authority in its sole discretion to waive the consequences under the Plan
or any Award Agreement of the existence or occurrence of any of the
events, acts or omissions constituting "Cause".
"CHANGE IN CONTROL" means the consummation of a merger,
consolidation, statutory share exchange or similar form of corporate
transaction involving GS Inc. (a "Reorganization") or sale or other
disposition of all or substantially all of GS Inc.'s assets to an entity
that is not an affiliate of GS Inc. (a "Sale"), that in each case requires
the approval of GS Inc.'s stockholders under the law of GS Inc.'s
jurisdiction of organization, whether for such Reorganization or Sale (or
the issuance of securities of GS Inc. in such Reorganization or Sale),
unless immediately following such Reorganization or Sale, either: (i) at
least 50% of the total voting power (in respect of the election of
directors, or similar officials in the case of an entity other than a
corporation) of (A) the entity resulting from such Reorganization, or the
entity which has acquired all or substantially all of the assets of GS
Inc. in a Sale (in either case, the "Surviving Entity"), or (B) if
applicable, the ultimate parent entity that directly or indirectly has
beneficial ownership (within the meaning of Rule 13d-3 under the Exchange
Act, as such Rule is in effect on the date of the adoption of the Plan) of
50% or more of the total voting power (in respect of the election of
directors, or similar officials in the case of an entity other than a
corporation) of the Surviving Entity (the "Parent Entity"), is represented
by GS Inc.'s securities (the "GS Inc.
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Securities") that were outstanding immediately prior to such
Reorganization or Sale (or, if applicable, is represented by shares into
which such GS Inc. Securities were converted pursuant to such
Reorganization or Sale) or (ii) at least 50% of the members of the board
of directors (or similar officials in the case of an entity other than a
corporation) of the Parent Entity (or, if there is no Parent Entity, the
Surviving Entity) following the consummation of the Reorganization or Sale
were, at the time of the Board's approval of the execution of the initial
agreement providing for such Reorganization or Sale, individuals (the
"Incumbent Directors") who either (1) were members of the Board on the
date of the Award or (2) became directors subsequent to the date of the
Award and whose election or nomination for election was approved by a vote
of at least two-thirds of the Incumbent Directors then on the Board
(either by a specific vote or by approval of GS Inc.'s proxy statement in
which such persons are named as a nominee for director).
"CLIENT" means any client or prospective client of the Firm to whom
you provided services, or for whom you transacted business, or whose
identity became known to you in connection with your relationship with or
employment by the Firm.
"COMPETITIVE ENTERPRISE" means a business enterprise that (i)
engages in any activity, or (ii) owns or controls a significant interest
in any entity that engages in any activity, that, in either case, competes
anywhere with any activity in which the Firm is engaged. The activities
covered by the previous sentence include, without limitation, financial
services such as investment banking, public or private finance, lending,
financial advisory services, private investing (for anyone other than you
and members of your family), merchant banking, asset or hedge fund
management, insurance or reinsurance underwriting or brokerage, property
management, or securities, futures, commodities, energy, derivatives or
currency brokerage, sales, lending, custody, clearance, settlement or
trading.
"EXTENDED ABSENCE" means you are unable to perform for six
continuous months, due to illness, injury or pregnancy-related
complications, substantially all the essential duties of your occupation,
as determined by the Committee.
"GOOD REASON" means (i) as determined by the Committee, a materially
adverse alteration in the your position or in the nature or status of your
responsibilities from those in effect immediately prior to the Change in
Control, or (ii) the Firm's requiring your principal place of Employment
to be located more than seventy-five (75) miles from the location where
you are principally Employed at the time of the Change in Control (except
for required travel on the Firm's business to an extent substantially
consistent with your customary business travel obligations in the ordinary
course of business prior to the Change in Control).
"RETIREMENT" means termination of your Employment on or after the
date on which (i) you have attained age 55 with 5 years of service with
the Firm, or (ii) the sum of (I) your age and (II) 1.5 times your years of
service with the Firm, is equal to or greater than 80.
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"SOLICIT" means any direct or indirect communication of any kind
whatsoever, regardless of by whom initiated, inviting, advising,
encouraging or requesting any person or entity, in any manner, to take or
refrain from taking any action.
"VESTING DATE" means the first day of each Window Period that begins
on or immediately follows each of the third, fourth and fifth
anniversaries of the consummation of the initial public offering of
Shares.
"WINDOW PERIOD" means a period designated by the Committee during
which employees of the Firm generally are permitted to purchase or sell
Shares.
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