Exhibit 10.3
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RECIPIENT:
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SHARES:
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PURCHASE
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GRANT DATE:
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EXPIRATION |
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PRICE:
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DATE: |
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This Agreement is made between Xxxxxxx Denver, Inc., a
Delaware corporation, having its principal
executive office in Quincy, Illinois (the “Company”), and the undersigned, an employee of the
Company or a subsidiary of the Company (the “Employee”).
The parties have agreed as follows:
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Pursuant to the Xxxxxxx Denver, Inc. Long-Term Incentive Plan, as amended, (the “Plan”), the
Company grants to the Employee a nonstatutory option to purchase the number of shares of the
Company’s common stock, par value $0.01 per share (the “Shares”), specified above, at the
price specified above, subject to the following conditions: |
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(a) |
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Subject to Sections 2 and 3, the option rights shall be exercisable only if and
after the Employee shall have remained in the employ of the Company for one year from
the date of grant of this option (the “Grant Date”), at which time such rights shall
become exercisable to the extent of 33 1/3% of the aggregate number of Shares specified
above, which percentage shall increase to 66 2/3% of such number after two years from
the Grant Date and 100% of such number after three years from the Grant Date. |
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(b) |
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Subject to Sections 2, 3 and 7, the option rights shall be exercisable only by
the Employee and only if the Employee has remained continuously in the employ of the
Company from the Grant Date. |
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(c) |
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The option rights shall expire at the Expiration Date specified above, or at such
earlier time as may be provided by Section 2, 3 or 14, or by cash payments made in
complete or partial cancellation pursuant to Section 9, and such option rights shall not
be exercisable after such expiration. |
2. |
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Option rights shall terminate if the Employee shall cease to be employed by the Company, as
follows: |
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(a) |
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If such cessation of employment is occasioned by any reason other than
retirement, disability or death, the option rights shall terminate immediately; |
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(b) |
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If such cessation of employment is occasioned by retirement in accordance with
any retirement plan of the Company then in effect, then the Employee at any time within
five years following such retirement (but not after the Expiration Date) may exercise
the option rights to the extent of 100% of the Shares covered by this option
(notwithstanding the extent to which the Employee otherwise was entitled to exercise the
same immediately prior to such retirement); and |
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(c) |
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If such cessation of employment is occasioned by the Employee’s disability, then
the Employee at any time within five years following such cessation of employment (but
not after the Expiration Date) may exercise the option rights to the extent of 100% of
the Shares covered by this option (notwithstanding the extent to which the Employee
otherwise was entitled to exercise the same immediately prior to such cessation of
employment). |
3. |
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If the Employee shall die while in the employ of the Company or shall die within the
five-year period during which the option rights may be exercised following retirement or
disability, then within the year next succeeding the Employee’s death (but not after the
Expiration Date), the person entitled by will or the applicable laws of descent and
distribution may exercise the option rights to the extent of 100% of the Shares covered by
this option (notwithstanding the extent to which the Employee otherwise was entitled to
exercise the same immediately prior to death). |
4. |
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This option may be exercised by delivering to the Company at its principal executive office
(directed to the attention of the Corporate Secretary, or if the Corporate Secretary is the
employee concerned, then to the attention of the President or a Vice President) a written
notice, signed by the Employee or a person entitled to exercise the option, as the case may
be, of the election to exercise the option and stating the number of Shares in respect of
which it is then being exercised. The option shall be deemed exercised as of the date the
Company receives such notice. As an essential part of such notice, it shall be accompanied by
(a) payment of the full purchase price of the Shares then being purchased and (b)
satisfaction, or agreement with the Company as to the manner of satisfaction, of any taxes
required by law to be withheld due to the exercise of the option, including an exercise by a
transferee to whom the Employee has transferred the option in accordance with Section 7. In
the event the option shall be exercised by any person other than the Employee, such notice
shall be accompanied by appropriate evidence of the right of such person to exercise the
option. Payment of the full purchase price may be made in (a) cash, (b) Shares, or (c) any
combination of cash and Shares, provided that any Shares used by the Employee in payment of
the purchase price must have been held by the Employee for a period of more than six months,
and provided further that the Company reserves the right to prohibit the use of Shares as
payment of the purchase price. Shares used in payment of the purchase price shall be valued
at the closing price of such Shares on the composite tape of the New York Stock Exchange or as
reported in the consolidated transaction reporting system for the date of exercise. Upon the
proper exercise of the option, the Company shall issue in the name of the person exercising
the option, and
deliver to such person, a certificate or certificates for the Shares purchased, or shall
otherwise properly evidence the purchase of such Shares in the Company’s stock records. The
Employee shall have no rights as a stockholder in respect of any Shares as to which the
option shall not have been effectively exercised as provided in this Agreement. |
5. |
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This option shall not be exercisable if such exercise would violate (a) any applicable
requirement under the Securities Act of 1933, as amended (the “Act”), the Securities Exchange
Act of 1934, as amended, or the listing requirements of any stock exchange; (b) any applicable
state securities law; or (c) any other applicable legal requirement. Furthermore, if a
registration statement with respect to the Shares to be issued upon the exercise of this
option is not in effect or if counsel for the Company deems it necessary or desirable in order
to avoid possible violation of the Act, the Company may require, as a condition to its
issuance of the Shares, the delivery to the Company of a commitment in writing by the person
exercising the option that at the time of such exercise it is the person’s intention to
acquire such Shares for the person’s own account for investment only and not with a view to,
or for resale in connection with, the distribution of such Shares, that such person
understands that the Shares may be “restricted securities” as defined in Rule 144 issued under
the Act, and that any resale, transfer or other disposition of the Shares will be accomplished
only in compliance with Rule 144, the Act, or other or subsequent applicable rules and
regulations under the Act. The Company may place on the certificates evidencing such Shares
an appropriate legend reflecting such commitment and the Company may refuse to permit transfer
of such Shares until it has been furnished evidence satisfactory to it that no violation of
the Act or the applicable rules and regulations would be involved in such transfer. |
6. |
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The Employee acknowledges that this option has been granted in anticipation of future
services being rendered by the Employee to the Company. In consideration of the granting of
this option by the Company, the Employee agrees to remain in the employ of the Company for a
period of not less than one year from the Grant Date unless during that period the Employee’s
employment ceases on account of disability, retirement in accordance with a retirement plan of
the Company, or with the consent of the Company. Nothing contained in this Agreement shall
limit or restrict any right the Company would otherwise have to terminate the employment of
the Employee. |
7. |
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This option may not be assigned, encumbered or transferred except, in the event of the death
of a Participant by will or by the laws of descent and distribution. The Employee shall have
the right, subject to the provisions of this Section 7, to transfer all or any portion of the
option granted under this Agreement (or an amendment thereto), for estate planning purposes,
to (a) the Employee’s spouse, children, grandchildren, parents, siblings, stepchildren,
stepgrandchildren or in-laws (“Family Members”), (b) entities that are exclusively
family-related, including trusts for the exclusive benefit of Family Members and limited
partnerships or limited liability companies in which Family Members are the only partners or
members, or (c) such other persons or entities specifically approved by the Committee of the
Board of Directors that administers the Plan (the “Committee”). The terms and conditions
applicable to the transfer of any such stock options or portion of an option transferred by
the Employee shall be established by the Committee, in its discretion but in accordance with
this Section 7 shall remain subject to the same terms and conditions as were applicable
immediately prior to the transfer, including those provisions regarding exercisability of the
option following the cessation of employment of the Employee by the Company and the death of
the Employee, except that no transferee may further transfer an option or portion of an option
transferred by the Employee in accordance with this Section 7, other than by will or the laws
of descent and distribution. In order to effect a transfer in accordance with this Section 7,
the Employee shall deliver to the Company (in the manner set forth in Section 4) a Notice of
Transfer of Option substantially in the form attached to this Agreement. |
8. |
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The Company and Employee agree that any claim, dispute or controversy arising under or in
connection with this Agreement (including, without limitation, any such claim, dispute or
controversy arising under any federal, state or local statute, regulation or ordinance or any
of the Company’s employee benefit plans, policies or programs) shall be resolved solely and
exclusively by binding arbitration. The arbitration shall be held in the city of St. Louis (or
at such other location as shall be mutually agreed by the parties). The arbitration shall be
conducted in accordance with the Expedited Employment Arbitration Rules (the “Rules”) of the
American Arbitration Association (the “AAA”) in effect at the time of the arbitration, except
that the arbitrator shall be selected by alternatively striking from a list of five
arbitrators supplied by the AAA. All fees and expenses of the arbitration, including a
transcript if either requests, shall be borne equally by the parties. If Employee prevails as
to any material issue presented to the arbitrator, the entire cost of such proceedings
(including, without limitation, Employee’s reasonable attorneys’ fees) shall be borne by the
Company. If Employee does not prevail as to any material issue, each party will pay for the
fees and expenses of its own attorneys, experts, witnesses, and preparation and presentation
of proofs and post-hearing briefs (unless the party prevails on a claim for which attorney’s
fees are recoverable under the Rules). Any action to enforce or vacate the arbitrator’s award
shall be governed by the Federal Arbitration Act, if applicable, and otherwise by applicable
state law. If either the Company or Employee pursues any claim, dispute or controversy against
the other in a proceeding other than the arbitration provided for herein, the responding party
shall be entitled to dismissal or injunctive relief regarding such action and recovery of all
costs, losses and attorney’s fees related to such action. Notwithstanding the provisions of
this paragraph, either party may seek injunctive relief in a court of competent jurisdiction,
whether or not the case is then pending before the panel of arbitrators. Following the
court’s determination of the injunction issue, the case shall continue in arbitration as
provided herein. |
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If a Change of Control occurs during the term of this Agreement, any stock option which is
not exercisable in full shall be entitled, in lieu of the exercise of the portion of the stock
option which is not exercisable, to obtain a cash payment in an amount equal to the difference
between the option price of such stock option to be determined pursuant to Section 21 of the
Plan.. |
10. |
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For purposes of this Agreement, employment by a parent or subsidiary of or a successor to the
Company shall be considered to be employment by the Company. |
11. |
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The Committee shall have authority, subject to the express provisions of the Plan, to
construe this Agreement and the Plan, to establish, amend and rescind rules and regulations
relating to the Plan, and to make all other determinations in the judgment of the Committee
necessary or desirable for the administration of the Plan. The Committee may correct any
defect or supply any omission
or reconcile any inconsistency in the Plan or in this Agreement in the manner and to the
extent it shall deem expedient to carry the Plan into effect. All action by the Committee
under the provisions of this paragraph shall be conclusive for all purposes. |
12. |
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The Employee agrees to notify the Company promptly of the disposition, whether by sale,
exchange or otherwise, of any Shares acquired pursuant to the exercise of this
option if such disposition occurs within one year from the acquisition of the Shares. Such
notice shall state the date and manner of disposition and the proceeds, if any, received by
the Employee. |
13. |
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This Agreement and the option granted under this Agreement shall be subject to all of the
provisions of the Plan as are in effect from time to time, which provisions of the Plan shall
govern if there is any inconsistency between this Agreement and the Plan. |
14. |
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The Committee in its sole discretion, may require the Employee to forfeit immediately,
without consideration from the Company, any portion of the option (including the right to
purchase the underlying shares of Common Stock relating to such portion) which was not
exercised prior to any of the following events: (a) the Employee, as individual or as a
partner, employee, agent, advisor, consultant or in any other capacity of or to any person,
firm, corporation or other entity, directly or indirectly, carries on any business, or becomes
involved in any business activity, competitive with the Company or any subsidiary, in
violation of the Company’s Code of Ethics and Business Conduct (CP-10-002); (b) the Employee
solicits or entices any other employee of the Company or its affiliates to leave the Company
or its affiliates to go to work for any other business or organization which is in direct or
indirect competition with the Company or any of its affiliates, or requests or advises a
customer or client of the Company or its affiliates to curtail or cancel such customer’s
business relationship with the Company or its affiliates; or (c) the Employee fails to abide
by the contractual terms of the Employee Nondisclosure Agreement and/or Invention Assignment
Agreement, as applicable, which were executed in accordance with the Company’s Security of
Confidential and Proprietary Information Policy (CP-10-013) during the Employee’s employment
with the Company; or (c) the Employee solicits. |
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The community interest, if any, of any spouse of the Employee in any of the Options shall be
subject to all of the terms, conditions and restrictions of this Agreement and the Plan, and
shall be forfeited and surrendered to the Company upon the occurrence of any of the events
requiring the Employee’s interest in such Options to be so forfeited and surrendered pursuant
to this Agreement. |
16. |
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This Agreement shall be governed by and construed and enforced in accordance with the laws of
the State of Delaware without reference to its principles of conflict of laws. |
17. |
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This Agreement sets forth the entire agreement, and supersedes all other agreements and
understandings, whether oral or written, by and between the parties relating to the subject
matter hereof. |
By your signature and the Company’s signature below, you and the Company agree that these options
are granted under and governed by the terms and conditions of the Company’s Long-Term Incentive
Plan as amended and the Incentive
Stock Option Agreement.
THE EMPLOYEE ACKNOWLEDGES AND AGREES THAT THE OPTIONS SUBJECT TO THIS OPTION AWARD SHALL VEST AND
BECOME EXERSIZABLE, IF AT ALL, ONLY DURING THE PERIOD OF EMPLOYEE’S SERVICE TO THE COMPANY OR AS
OTHERWISE PROVIDED IN THIS AGREEMENT (NOT THROUGH THE ACT OF BEING GRANTED THE OPTIONS). THE
EMPLOYEE FURTHER ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS AGREEMENT OR THE PLAN SHALL CONFER
UPON EMPLOYEE ANY RIGHT WITH RESPECT TO FUTURE OPTION AWARDS OR CONTINUATION OF EMPLOYEE’S SERVICE
TO THE COMPANY. The Employee acknowledges receipt of a copy of the Plan, represents that he or she
is familiar with the terms and provisions thereof, and hereby accepts the Option Award subject to
all of the terms and provisions hereof and thereof, including the mandatory Dispute Resolution
Procedure. The Employee has reviewed this Agreement and the Plan in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Agreement, and fully
understands all provisions of this Agreement and the Plan.
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XXXXXXX DENVER, INC. |
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By: |
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Title: |
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EMPLOYEE |
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Signed: |
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Dated: |
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