NOBILITY HOMES, INC.
STOCK INCENTIVE PLAN
KEY EMPLOYEE OPTION AWARD AGREEMENT
THIS AGREEMENT is made and entered into as of the date set forth on
the signature page hereof by and between NOBILITY HOMES, INC., a Florida
corporation ("Company"), and the individual whose signature is set forth
on the signature page hereof (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company has adopted the Nobility Homes, Inc. Stock
Incentive Plan ("Plan"), the terms of which, to the extent not stated
herein, are specifically incorporated by reference in this Agreement;
WHEREAS, the purpose of the Plan is to permit Awards under the Plan
to be granted to Key Employees of the Company, and the Plan provides for
Award Agreements to further specify the terms and conditions under which
such individuals may receive such Awards;
WHEREAS, the Optionee is now serving as a Key Employee of the Company
or an Affiliate in a key capacity and the Company desires him or her to
remain in such capacity, and to secure or increase his or her ownership of
Shares in order to increase his or her incentive and personal interest in
the success and growth of the Company; and
WHEREAS, defined terms used herein and not otherwise defined herein
shall have the meanings set forth in the Plan.
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements herein set forth, the parties hereby mutually covenant and
agree as follows:
1. Option Grant.
(a) Subject to the terms and conditions set forth herein, the
Company hereby grants to the Optionee an option (the "Option") to purchase
from the Company all or any part of the aggregate number of Shares
(hereinafter referred to as the "Option Stock") set forth on the signature
page hereof, at the purchase price per Share set forth on the signature
page hereof. The Option shall not be an Incentive Stock Option for
purposes of Section 422 of the Code. The Option may not be exercised
prior to the Initial Exercise Date set forth on the signature page hereof
or after the Expiration Date set forth thereon, except that other than as
provided herein, the Option shall not be exercisable after (i) the
termination of the Optionee's employment with the Company or any Affiliate
of the Company or (ii) Optionee's position with the Company or any
Affiliate ceases to be that of a manager or a position higher than manager
(collectively, "Employment").
(b) The Option may be exercised in whole or in part by notice
in writing to the Company. The aggregate purchase price for the Shares
for which the Option is exercised shall be paid to the Company at the time
of exercise in cash, Shares registered in the name of the Optionee that
have been held by Optionee for more than six months, or by a combination
thereof, all as provided on the signature page hereof. If the purchase
price may be paid wholly or partly in Shares, any Shares tendered in
payment thereof shall be free of all adverse claims and duly endorsed in
blank by the Optionee or accompanied by stock powers duly endorsed in
blank. Shares tendered shall be valued at Fair Market Value on the date
on which the Option is exercised.
Payment of the aggregate purchase price for the Shares for which
the option is exercised may also be made in whole or in part by delivery
(including by facsimile) to the Company of an executed irrevocable option
exercise form together with irrevocable instructions, in a form acceptable
to the Company, to a broker-dealer to sell or margin a sufficient portion
of the Option Stock and deliver the sale or loan proceeds directly to the
Company to pay for the exercise price.
2. Nontransferability of Option. Except as may be permitted
otherwise pursuant to the Plan, this Option is not transferable other than
by will or by the laws of descent and distribution. The Option may be
exercised during the life of the Optionee only by the Optionee (or his/her
legal representative).
3. Securities Law Restrictions. The Optionee agrees and
acknowledges with respect to any Option Stock that has not been registered
under the Securities Act of 1933, as amended (the "Act"), that (i) the
Optionee will not sell or otherwise dispose of such Shares except pursuant
to an effective registration statement under the Act and any applicable
state securities laws, or in a transaction which, in the opinion of
counsel for the Company, is exempt from such registration, and (ii) a
legend will be placed on the certificates for the Option Stock to such
effect.
4. Exercise of Option.
(a) Except as provided herein, the Option shall be exercisable
only prior to the Expiration Date, and then only as set forth in the
following table:
Cumulative Fraction
of Shares Optioned
Years From Grant Date Which Is Exercisable
(b) If the Optionee's Employment is terminated because of death
or Total Disability (as such terms are defined below) on or after the
Initial Exercise Date, the Optionee or, in the case of his or her death,
his or her Beneficiary (as defined herein) shall be entitled to exercise
the Option, in the full amount granted without regard to any restrictions
on exercise set forth in paragraph (a), above, until the Expiration Date.
If such a termination occurs prior to the Initial Exercise Date, the
Optionee, or in the case of his or her death, his or her Beneficiary,
shall be entitled to exercise the Option to the extent, if any, as the
Board of Directors or Committee may determine.
(c) If the Optionee's Employment is terminated on or after the
Initial Exercise Date for any reason other than Cause (as defined below),
death or Total Disability, the Optionee shall be entitled to exercise the
Option, to the extent exercisable pursuant to paragraph (a), above, until
3 months after such termination. If such a termination occurs prior to
the Initial Exercise Date, the Optionee shall be entitled to exercise the
Option during such 3-month period to the extent, if any, as the Board of
Directors or Committee may determine.
(d) If the Optionee's Employment is terminated for Cause, the
Optionee shall have no right to exercise any portion of any Option not yet
exercised as of the date of such termination for Cause.
(e) As used herein, (i) "Total Disability" means permanent and
total disability within the meaning of Code Section 22(e)(3), and (ii)
"Cause" means, as determined by the Board of Directors, the Optionee's
willful failure to perform his or her duties or intentional dishonest or
intentional illegal conduct in connection with his or her Employment.
5. Acceleration.
(a) In the event of a Change of Control (as defined below) any
Options shall be immediately exercisable (without regard to any limitation
imposed by the Plan or this Agreement at the time the Option was granted,
which permits all or any part of the Option to be exercised only after the
lapse of time), and will remain exercisable until the expiration of the
Option. "Change of Control" for this purpose means: (i) the adoption of
a plan of reorganization, merger, share exchange or consolidation of the
Company with one or more other corporations or other entities as a result
of which the holders of the Shares as a group would receive less than
fifty percent (50%) of the voting power of the capital stock or other
interests of the surviving or resulting corporation or entity; (ii) the
adoption of a plan of liquidation or the approval of the dissolution of
the Company; (iii) the approval by the Board of Directors of an agreement
providing for the sale or transfer (other than as security for obligations
of the Company or any subsidiary) of substantially all of the assets of
the Company; (iv) the acquisition of more than thirty percent (30%) of the
outstanding Shares by any person within the meaning of Rule 13(d)(3) under
the Securities Exchange Act of 1934, as amended, if such acquisition is
not preceded by a prior expression of approval by the Board; or (v) one-
third or more of the members of the Board of Directors of the Company are
not Continuing Directors (a "Continuing Director" means any member of the
Board of Directors of the Company who was elected as a director at the
Company's 1996 annual meeting of shareholders, and any director who is
recommended for election, or is elected to fill a vacancy, as a director
by a majority of the Continuing Directors then on such Board).
6. Beneficiary.
(a) The person whose name appears on the signature page hereof
after the caption "Beneficiary" or any successor designated by the
Optionee in accordance herewith (the person who is the Optionee's
Beneficiary at the time of his or her death herein referred to as the
"Beneficiary") shall be entitled to exercise the Option, to the extent it
is exercisable, after the death of the Optionee. The Optionee may from
time to time revoke or change his or her Beneficiary without the consent
of any prior Beneficiary by filing a new designation with the Committee.
The last such designation received by the Committee shall be controlling;
provided, however, that no designation, or change or revocation thereof,
shall be effective unless received by the Committee prior to the
Optionee's death, and in no event shall any designation be effective as of
a date prior to such receipt.
(b) If no such Beneficiary designation is in effect at the time
of an Optionee's death, or if no designated Beneficiary survives the
Optionee or if such designation conflicts with law, the Optionee's estate
shall be entitled to exercise the Option, to the extent it is exercisable
after the death of the Optionee. If the Board of Directors or Committee
is in doubt as to the right of any person to exercise the Option, the
Company may refuse to recognize such exercise, without liability for any
interest or dividends on the Option Stock, until the Board of Directors or
Committee determines the person entitled to exercise the Option, or the
Company may apply to any court of appropriate jurisdiction and such
application shall be a complete discharge of the liability of the Company
therefor.
7. No Rights As Stockholder. The Optionee shall have no
rights as a holder of the Option Stock until the issuance of a certificate
for the Option Stock.
8. Tax Withholding.
(a) It shall be a condition of the obligation of the Company to
issue Option Stock to the Optionee or the Beneficiary, and the Optionee
agrees, that the Optionee shall pay to the Company upon its demand, such
amount as may be requested by the Company for the purpose of satisfying
any liability it may have to withhold federal, state, or local income or
other taxes incurred by reason of the exercise of the Option.
(b) If the purchase price may be paid wholly or partly in
Shares, the Optionee may elect to have the Company withhold that number of
Shares of Option Stock otherwise issuable to the Optionee upon exercise of
the Option or to deliver to the Company a number of Shares, in each case,
having a Fair Market Value on the Tax Date (as defined below) equal to the
minimum amount required to be withheld as a result of such exercise. The
election must be made in writing and must be delivered to the Company
prior to the Tax Date. If the number of shares so determined shall
include a fractional share, the Optionee shall deliver cash in lieu of
such fractional share. As used herein, Tax Date means the date on which
the Optionee must include in his or her gross income for federal income
tax purposes the fair market value of the Option Stock over the purchase
price therefor.
9. Adjustments in Event of Change in Shares. In the event
that the Committee shall determine that any dividend or other distribution
(whether in the form of Shares, other securities, or other property),
recapitalization, stock split, reverse stock split, reorganization,
merger, consolidation, split-up, spin-off, combination, repurchase, or
exchange of securities of the Company, or other similar corporate
transaction or event affects the Shares issuable on exercise of the
Option, such that an adjustment is determined by the Board of Directors or
Committee to be appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the
Plan, then the Board of Directors or Committee shall, in such manner as it
may deem equitable, promptly adjust the number and type of Shares awarded
pursuant to this Agreement, or the terms, conditions, or restrictions of
this Agreement; provided, however, that the number of Shares subject to
any Award payable or denominated in Shares shall always be a whole number.
10. Powers of Company Not Affected. The existence of the
Option shall not affect in any way the right or power of the Company or
its shareholders to make or authorize any combinations, subdivision or
reclassification of the Shares or any reorganization, merger,
consolidation, business combination, exchange of Shares, or other change
in the Company's capital structure or its business, or any issue of bonds,
debentures or stock having rights or preferences equal, superior or
affecting the Option Stock or the rights thereof or dissolution or
liquidation of the Company, or any sale or transfer of all or any part of
its assets or business, or any other corporate act or proceeding, whether
of a similar character or otherwise. Nothing in this Agreement shall
confer upon the Optionee any right to continued Employment.
11. Miscellaneous.
(a) This Agreement shall be governed and construed in
accordance with the laws of the State of Florida applicable to contracts
made and to be performed therein between residents thereof.
(b) This Agreement may not be amended or modified except by the
written consent of the parties hereto.
(c) The captions of this Agreement are inserted for convenience
of reference only and shall not be taken into account in construing this
Agreement.
(d) This Agreement shall be binding upon and inure to the
benefit of the Company and its successors and assigns and shall be binding
upon and inure to the personal benefit of the Optionee, the Beneficiary
and the personal representative(s) and heirs of the Optionee.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed by its duly authorized officer and its corporate seal hereunto
affixed, and the Optionee has hereunto affixed his or her hand, all on the
day and year set forth below.
NOBILITY HOMES, INC.
[CORPORATE SEAL] By:___________________________
Its:_____________________
______________________________
Optionee
Name:
No. of Shares of Option Stock: Grant Date:
Exercise Price Per Share:$
Payment of Purchase Initial Exercise Date:
Price: Cash and/or Shares
Date of Agreement: Expiration Date:
Beneficiary: Address of Beneficiary:
Beneficiary Tax Identification
No.:
