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EXHIBIT 4.4
STOCK OPTION AGREEMENT
This Agreement, made as of this 27th day of July, 2000, by XXXXXXX COMPANY,
a Delaware Corporation (hereinafter called the "Company"), with XXXXX X. XXXXXXX
(hereinafter called "Optionee").
For and in consideration of the respective agreements herein set forth, it
is hereby agreed as follows:
1. Optionee agrees to devote fifty (50) percent of his working time to
consulting with the Company on such matters as the Chief Executive Officer
of the Company may direct.
2. Subject to the terms and conditions of this Stock Option Agreement, the
Company hereby grants to the Optionee the Option to purchase 300,000 shares
of the common stock ($.25 par value per share) of the Company (hereinafter
the "Option").
3. The exercise price per share shall be $27.00, the fair market value of the
common stock on the date of the Option grant as determined by the Board of
Directors. The fair market value means the average between the highest and
lowest sale prices per share on the New York Stock Exchange Composite
Transactions Tape on such date, provided that if there shall be no sales of
shares reported on such date, the fair market value of a share on such date
shall be deemed to be equal to the average of the highest and lowest sale
prices per share on such Composite Tape for the last preceding date on
which sales of shares were reported. The purchase price for exercise of the
Option shall be payable at the time the Option is exercised, in cash, or by
exchange of shares of common stock of the Company previously owned by the
Optionee, with a market value equal, on the date of payment, to the
aggregate purchase price for the Option, or partly in cash, and the
remainder in shares of common stock of the Company.
4. The Option may be exercised in whole or in part, subject to the terms and
provisions of this Stock Option Agreement, by mailing by registered mail,
or by delivering in person, a Notice Of Exercise Of Option to the Office of
the Chairman, Xxxxxxx Company, Xxx Xxxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxxx
00000-0000. Such notice shall state the number of shares with respect to
which the Option is being exercised and the method of payment for such
shares. A copy of the Notice of Exercise shall simultaneously be delivered
to the Secretary of Xxxxxxx Company, Xxx Xxxxxxx Xxxxxx, Xxxxxx Xxxxx, XX
00000-0000.
5. The Option is not an incentive stock option under the provisions of the
Internal Revenue Code. The Option is intended to be exempt from the
provisions of Section 16(b) of the Securities Exchange Act of 1934 under
Securities and Exchange Commission Rule 16b(3). No securities acquired
pursuant to the exercise of this Option may be sold prior to a date that is
six (6) months from the date of this Stock Option Agreement.
6. The Option vests in equal, annual installments over three (3) years;
one-third as of the date hereof; one-third on the first anniversary date of
the grant; and one-third on the second anniversary date of the grant;
provided, however, vesting of the second and third installments will be
contingent upon this Stock Option Agreement remaining in effect through
such installment periods. This Stock Option Agreement shall terminate
immediately, as to unvested portions of this Option, if the Optionee
notifies the Company that he is no longer willing to devote fifty (50%)
percent of his working time to consulting with the Company pursuant to
paragraph 1 hereof or if the Company notifies the Optionee that it no
longer
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wishes to receive such consulting services. In the event of such
termination, portions of this Option that have not vested shall terminate
and be forfeited to the Company, and vested portions of this Option may be
exercised at any time prior to the expiration of the Option.
7. In the event Optionee pays the Option price and any associated tax
withholding obligations in whole or in part by surrendering shares of the
Company's common stock, then Optionee may be eligible to receive an
accelerated ownership feature (AOF) Option to purchase a number of shares
of common stock equal to the number of shares delivered to pay the Option
price or delivered or withheld for tax withholding obligations. The AOF
Option, if granted, will be exercisable for a term ending on the same date
as this Option. The exercise price of the AOF Option will be the fair
market value of the common stock on the date the AOF is awarded as
determined by the Board of Directors in the exercise of its discretion. AOF
Options will be awarded only if no other AOF Option has been awarded to the
Optionee within the six-month period (6) prior to the date of the exercise
of this Option.
8. This Agreement shall be construed in accordance with the laws of the State
of Delaware (regardless of the law that might otherwise govern under
applicable Delaware principles of conflict laws) to the extent not
superceded by the laws of the United States government concerning
securities.
9. If Optionee exercises any portion of the Option granted pursuant to this
Agreement and within one (1) year after such exercise, attempts to provide
consulting services to a direct competitor of Xxxxxxx Company, then the
gain represented by the mean market price on the date of exercise over the
exercise price, multiplied by the number of shares purchased by the
Optionee, less any applicable withholding or tax obligations, without
regard to any subsequent market price decrease or increase, shall be paid
by Optionee to the Company. Furthermore, any unexercised Options will be
immediately cancelled by the Company at the time of such event.
10. This Option shall not be transferable, except by will or the laws of
descent and distribution; and the Option shall be exercisable during
Optionee's lifetime only by the Optionee.
11. Optionee's right to exercise this Option terminates on the earliest of the
following:
a. one (1) year after the Optionee's services as a Consultant or a member
of the Board of Directors are terminated by death. Any portion of the
Option exercisable following the death of the Optionee may be
exercised subject to the terms and conditions contained herein by the
Optionee's estate or by a person who has the acquired the right to
exercise such Option by Will or the laws of descent;
b. ten (10) years from the date the Option was granted, July 27, 2000; or
c. immediately, with respect to any unvested portions of this Option,
upon the occurrence of any of the events described in paragraph 6 of
this Stock Option Agreement; or
d. immediately upon the occurrence of the event described in paragraph 9
of this Stock Option Agreement.
12. If any change is made in the stock subject to this Option, subsequent to
the effective date of the grant of Option (through merger, consolidation,
reorganization, recapitalization, stock dividend, split up, combination,
exchange, change in corporate structure, or otherwise) appropriate
adjustments shall be made by the Board of Directors as to the maximum
number of shares subject to the Option and the price per share of stock
subject to this
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Option. Any adjustment made by the Board of Directors shall be final and
binding upon the Optionee.
13. Notwithstanding any other provision of this Option to the contrary, in the
event of a Change in Control, any portion of this Option outstanding as of
the date of Change in Control, which is not then exercisable and vested,
shall become fully exercisable and vested as of the date such Change in
Control has deemed to have occurred. For the purposes of this Stock Option
Agreement, the term "Change in Control" shall have the same meaning as is
found in Section 14.2 of the Xxxxxxx Company 2001 Long-Term Incentive Plan
and any amendments thereto.
14. The Board of Directors may suspend or terminate this Stock Option Agreement
and the Option at any time and from time to time in such respects as the
Board may deem advisable to ensure that the Option conforms or otherwise
reflects changes in applicable laws or regulations or to permit the Company
or the Optionee to benefit from changes in applicable laws and regulations,
or in any other respect, the Board may deem to be in the best interest of
the Company. No such amendment, suspension, or termination shall materially
adversely effect the rights of the Optionee without the consent of the
Optionee, or revise the exercise price of the Option or increase the number
of shares available under the Option without Xxxxxxx Company share owner
approval.
15. Xxxxxxx Company shall have the right to deduct from any payment or
settlement any federal, state, local, or other tax of any kind that the
Board of Directors, in its sole discretion, deems necessary to be withheld
to comply with the Internal Revenue Code and/or any other applicable law,
rule, or regulation.
16. The grant of this Option shall not confer upon Optionee any right to
continuing service with the Company.
17. This Option shall become effective as of July 27, 2000, and shall continue
for a term of ten (10) years thereafter unless terminated at an earlier
date by Optionee or Company, or as otherwise provided in this Agreement.
This Agreement replaces, in its entirety, a previously issued form of a
Stock Option Agreement between the Company and the Optionee, which had
errors in several terms.
XXXXXXX COMPANY OPTIONEE
/s/ XXXXX X. XXXXXXX
By: /s/ XXXXX XXXXXXXX XXXXX ------------------------------
--------------------------------- Xxxxx X. Xxxxxxx
Xxxxx Xxxxxxxx Xxxxx
Executive Vice President -- Address:
Corporate Development,
General Counsel and Secretary ------------------------------
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