EXHIBIT 10.16
PHOENIX GOLD INTERNATIONAL, INC.
GRANT NO. NSO-9
NONSTATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of February 18, 1997 between PHOENIX GOLD
INTERNATIONAL, INC., an Oregon corporation (the "Company"), and XXXXX X. XXXXXXX
(the "Optionee").
Optionee has been automatically granted a nonstatutory stock option
to purchase shares of the Company's Common Stock, without par value per share
(the "Common Stock"), in the amount indicated below. This Option is granted
outside of the Company's Amended and Restated 1995 Stock Option Plan (the
"Plan"). Nonetheless, certain of the terms and conditions of the Plan are
incorporated into this Option Agreement by reference.
NOW, THEREFORE, in consideration of the promises and the mutual
covenants contained in this Option Agreement, the parties agree as follows:
1. Grant. The Company grants to Optionee, upon the terms and
conditions set forth below, the right and option (the "Option") to purchase
5,000 shares of Common Stock at an exercise price of $4.63 per share (the
"Exercise Price"). The Option is a Nonstatutory Stock Option and is not intended
to qualify as an Incentive Stock Option under Section 422 of the Code.
2. Term of Option. Subject to reductions in the term of the Option as
provided in this Option Agreement, the Option shall continue in effect until
February 18, 2007, and may be exercised during such term only in accordance with
the provisions of the Plan and this Option Agreement.
3. Vesting Schedule. The Option may be exercised, in whole or in
part, in accordance with the following schedule: (a) on the first anniversary of
the date hereof, one-third of the shares purchasable under the Option may be
purchased at any time thereafter until the Option expires; and (b) continuing on
each of the second and third anniversaries of the date hereof, an additional
one-third of the shares purchasable under the Option may be purchased at any
time thereafter until the Option expires.
4. Exercise of Option.
A. Right to Exercise. The Option is exercisable during its term
in accordance with the vesting schedule set forth above in Section 3 and the
applicable provisions of this Option Agreement. In the event that the Optionee's
service with the Company terminates during the term of the Option, the
exercisability of the Option shall be governed by the applicable provisions of
the Plan, as if the Option had been granted under the Plan, and this Option
Agreement.
B. Method of Exercise. The Option is exercisable by delivery of
an exercise notice, which notice shall state the election to exercise the
Option, the number of shares of Common Stock in respect of which the Option is
being exercised (the "Exercised Shares"), and such other representations and
agreements as may be required by the Company pursuant to the provisions of the
Plan. In addition, Optionee agrees to execute, as a condition of Option
exercise, such agreements respecting the Exercised Shares as the Committee, in
its reasonable discretion, determines to be required under the terms of
agreements to which the Company is a party or otherwise advisable and in the
best interests of the Company. The exercise notice shall be signed by Optionee
and shall be delivered in person or by certified mail to the Secretary of the
Company. The exercise notice shall be accompanied by payment of the aggregate
Exercise Price as to all the Exercised Shares. The Option shall be deemed to be
exercised upon receipt by the Company of such fully executed exercise notice
accompanied by such aggregate Exercise Price. For income tax purposes the
Exercised Shares shall be considered transferred to Optionee on the date the
Option is exercised with respect to such Exercised Shares.
5. Conditions. The obligations of the Company under this Option
Agreement shall be subject to the approval of such state or federal authorities
or agencies as may have jurisdiction in the matter. The Company will use its
best efforts to take such steps as may be required by state or federal law or
applicable regulations, including rules and regulations of the Securities and
Exchange Commission and any national securities exchange on which the Common
Stock may then be listed, in connection with the issuance or sale of any shares
acquired pursuant to this Option Agreement or the listing of such shares on any
such exchange. The Company shall not be obligated to issue or deliver shares of
Common Stock under this Option Agreement if, upon advice of its legal counsel,
such issuance or delivery would violate state or federal securities laws.
6. Method of Payment. Payment of the aggregate Exercise Price shall be
by any of the following, or a combination thereof, at the election of Optionee:
(i) cash; or
(ii) check; or
(iii) delivery of such documentation as the Committee and Optionee's
broker shall require to effect an exercise of the Option and
delivery to the Company of the sale or margin loan proceeds
required to pay the aggregate Exercise Price of the Exercised
Shares; or
(iv) surrender of other shares of Common Stock which have a Fair
Market Value on the date of surrender equal to the aggregate
Exercise Price of the Exercised Shares.
7. Restriction on Transfer. The Option may not be transferred in any
manner otherwise than by will or by the laws of descent or distribution or, with
the consent of the Committee, pursuant to a qualified domestic relations order
(a "QDRO") as defined by the Code or Title I of the Employee Retirement Income
Security Act of 1974, as amended, and may be exercised during the lifetime of
Optionee only by Optionee or Optionee's guardian or legal representative or
Optionee's permitted assignee or transferee pursuant to a QDRO. The terms of the
Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and permitted assigns of Optionee.
8. Legends. All certificates representing any of the shares of Common
Stock subject to the provisions of this Option Agreement may, in the sole
discretion of the Committee, have endorsed thereon the following legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR
AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED."
(b) Any legend required to be placed thereon by
applicable Blue Sky laws of any state.
(c) Any legend required to be placed thereon by
any applicable shareholder agreement.
9. Employment; Service. Nothing in the Plan or in this Option
Agreement shall (a) confer upon the Optionee any right with respect to
employment with the Company or any affiliate of the Company or (ii) interfere in
any way with the right of the Company or any affiliate of the Company to
terminate the Optionee's employment (or service as a Director, in accordance
with applicable corporate law, or service as a Consultant) at any time for any
reason, with or without cause.
10. The Plan. Although the Option has been granted outside of the
Plan, the parties desire that the Option be subject to the terms and conditions
of the Plan as if it had been granted under the Plan.
11. Definitions. Any capitalized term in this Option Agreement which
is not defined herein and which is defined in the Plan shall have the same
definition as in the Plan.
12. Governing Law. To the extent that federal laws (such as the Code
and the federal securities laws) do not otherwise control, the Plan and this
Option Agreement shall be construed in accordance with the laws of the state of
Oregon.
13. Headings. Headings contained in this Option Agreement are for
reference purposes and shall not affect the meaning or interpretation of this
Option Agreement.
Optionee and the Company agree that the Option is granted under and
governed by the terms and conditions of the Plan and this Option Agreement.
Optionee has reviewed the Plan and this Option Agreement in their entirety, has
had an opportunity to obtain the advice of counsel prior to executing this
Option Agreement and fully understands all provisions of the Plan and Option
Agreement. Optionee hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Committee upon any questions relating to the
Plan and Option Agreement.
OPTIONEE: PHOENIX GOLD INTERNATIONAL, INC.
/s/ Xxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
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Signature Xxxx X. Xxxxxx
Vice President and General Counsel
XXXXX X. XXXXXXX
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Print Name
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Social Security Number
