FORM OF STOCK OPTION AGREEMENT
The individuals listed below received options to purchase the indicated
number of shares of Common Stock pursuant to Stock Option Agreements dated as of
the dates indicated and exercisable at the price per share indicated, in the
form attached, which were granted under the Company's 1995 Stock Option and
Restricted Stock Plan.
Number of Shares
Participant Date of Grant Subject to Option Exercise Price
----------- ------------- ----------------- --------------
Xxxxx X. Xxxxxx 3/31/95 138,000 10.51
1/1/96 13,800 12.32
1/1/97 53,000 20.25
C.O. Xxxxxxxx 3/31/95 138,000 10.51
1/1/96 20,700 12.32
Xxxxxxx X. Xxxxx 1/1/97 13,000 20.25
Xxxxx X. Xxxxxxxx 3/31/95 34,500 10.51
1/1/96 5,175 12.32
Xxxxxx X. Xxxxxxx 3/31/95 34,500 12.32
1/1/96 5,175 10.51
Xxxxx X. Xxxx 3/31/95 77,625 10.51
1/1/96 6,900 12.32
1/1/97 13,000 20.25
SUIZA FOODS CORPORATION
STOCK OPTION AGREEMENT
THIS AGREEMENT (this "Agreement"), effective as of __________________,
199__, is made and entered into by and between Suiza Foods Corporation, a
Delaware corporation (the "Corporation"), and _______________________ (the
"Participant").
WITNESSETH:
WHEREAS, the Corporation has implemented the Suiza Foods Corporation 1995
Stock Option and Restricted Stock Plan (the "Plan"), which was adopted by the
Corporation's Board of Directors (the "Board") and approved by the Corporation's
stockholders, and which provides for the grant of stock options and restricted
stock to certain selected officers, directors and key employees of the
Corporation or its subsidiaries with respect to shares of Common Stock, $.01 par
value, of the Corporation (the "Common Stock");
WHEREAS, the stock options and restricted stock provided for under the Plan
are intended to comply with the requirements of Rule 16b-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
WHEREAS, the committee appointed by the Board to administer the Plan (the
"Committee") has selected the Participant to participate in the Plan and has
awarded the non-qualified stock option described in this Agreement (the
"Option") to the Participant;
WHEREAS, the parties hereto desire to evidence in writing the terms and
conditions of the Option.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements herein contained, and as an inducement to the
Participant to continue as an employee of the Corporation or its subsidiaries
and to promote the success of the business of the Corporation and its
subsidiaries, the parties hereby agree as follows:
1. GRANT OF OPTION. The Corporation hereby grants to the Participant,
upon the terms and subject to the conditions, limitations and restrictions set
forth in the Plan and in this Agreement, the Option to acquire __________ shares
of Common Stock, at an exercise price per share of $________, effective as of
the date of this Agreement (the "Award Date"). The Participant hereby accepts
the Option from the Corporation.
2. VESTING. The shares of Common Stock subject to the Option shall vest
ratably in three equal annual increments commencing on the first anniversary of
the Award Date. Notwithstanding the preceding sentence, the Option shall
immediately vest in full as to all shares of Common Stock subject hereto upon
any "Sale of the Corporation". A "Sale of the Corporation" shall occur if the
Corporation shall engage in a merger, consolidation, recapitalization,
reorganization or sale, lease or transfer of all or substantially all of the
Corporation's assets and the Corporation or its stockholders or affiliates
immediately before such
transaction shall beneficially own, immediately after or as a result of such
transaction, equity securities of the surviving or acquiring corporation or such
corporation's parent corporation possessing less than fifty-one percent (51%) of
the voting power of the surviving or acquiring corporation or such corporation's
parent corporation, provided that a Sale of the Corporation shall not be deemed
to occur upon any public offering or series of such offerings of securities of
the Corporation or its affiliates that results in any such change in beneficial
ownership.
3. EXERCISE. In order to exercise the Option with respect to any vested
portion, the Participant shall provide written notice to the Corporation at its
principal executive office. At the time of exercise, the Participant shall pay
to the Corporation the exercise price per share set forth in Section 1 times the
number of vested shares as to which the Option is being exercised. The
Participant shall make such payment in cash, check or at the Corporation's
option, by the delivery of shares of Common Stock having a Fair Market Value (as
defined in the Plan) on the date immediately preceding the exercise date equal
to the aggregate exercise price. If the Option is exercised in full, the
Participant shall surrender this Agreement to the Corporation for cancellation.
If the Option is exercised in part, the Participant shall surrender this
Agreement to the Corporation so that the Corporation may make appropriate
notation hereon or cancel this Agreement and issue a new agreement representing
the unexercised portion of the Option.
If the shares to be purchased are covered by an effective registration
statement under the Securities Act of 1933, as amended (the "Act"), the Option
may be exercised by a broker-dealer acting on behalf of the Participant if (a)
the broker-dealer has received from the Participant or the Corporation a fully-
and duly-endorsed agreement evidencing such option, together with instructions
signed by the Participant requesting the Corporation to deliver the shares of
Common Stock subject to such option to the broker-dealer on behalf of the
Participant and specifying the account into which such shares should be
deposited, (b) adequate provision has been made with respect to the payment of
any withholding taxes due upon such exercise, and (c) the broker-dealer and the
Participant have otherwise complied with Section 220.3(e)(4) of Regulation T, 12
CFR Part 220, or any successor provision.
4. WHO MAY EXERCISE. The Option shall be exercisable during the lifetime
of the Participant only by the Participant. To the extent exercisable after the
Participant's death, the Option shall be exercised only by the Participant's
representatives, executors, successors or beneficiaries.
5. EXPIRATION OF OPTION. The Option shall expire, and shall not be
exercisable with respect to any vested portion as to which the Option has not
been exercised, on the first to occur of: (a) the tenth anniversary of the Award
Date; or (b) 60 days after any termination of the Participant's employment with
the Corporation for any reason other than death (or 120 days after any such
death). The Option shall expire, and shall not be exercisable, with respect to
any unvested portion, immediately upon the termination of the Participant's
employment with the Corporation for any reason, including death.
6. TAX WITHHOLDING. Any provision of this Agreement to the contrary
notwithstanding, the Corporation may take such steps as it deems necessary or
desirable for the
withholding of any taxes that it is required by law or regulation of any
governmental authority, federal, state or local, domestic or foreign, to
withhold in connection with any of the shares of Common Stock subject hereto.
7. DILUTION. The number of shares of Common Stock subject to the Option
and the exercise price therefor set forth in Section 1 shall be subject to
adjustment for any Dilutive Event. A "Dilutive Event" shall include any of the
following events that results in dilution to the shares of Common Stock acquired
or acquirable upon exercise of the Option: any increase or decrease in the
shares of Common Stock or any other capital stock of the Corporation or any
change or exchange of any such securities for a different number or kind of
securities, any of which results from one or more stock splits, reverse stock
splits, stock dividends, recapitalizations, reorganizations or other corporate
actions with a similar effect. A "Dilutive Event" shall not include, however,
among other things: (i) the issuance or exercise of options granted pursuant to
the Plan or pursuant to any other stock-based compensation plan adopted by the
Corporation's Board of Directors; or (ii) any issuance of capital stock by the
Corporation for Fair Market Value or any issuance or grant to any person or
entity of any right to subscribe for or to purchase any capital stock or
securities convertible into any capital stock of the Corporation for Fair Market
Value.
8. TRANSFER OF OPTION. The Participant shall not, directly or
indirectly, sell, transfer, pledge, encumber or hypothecate ("Transfer") any
unvested portion of the Option or the rights and privileges pertaining thereto.
In addition, the Participant shall not, directly or indirectly, Transfer any
vested portion of the Option or any shares of Common Stock acquired upon
exercise of the Option other than (i) with the prior written consent of the
Corporation, (ii) by will or the laws of descent and distribution, (iii) with
respect to shares of Common Stock acquired upon exercise of the Option, pursuant
to an effective registration statement filed under the Act, or (iv) with respect
to shares of Common Stock acquired upon exercise of the Option, pursuant to an
exemption from the registration requirements of the Act. Any permitted
transferee to whom the Participant shall Transfer the Option pursuant to (i) or
(ii) above shall agree to be bound by this Agreement. Neither the Option nor
the underlying shares of Common Stock is liable for or subject to, in whole or
in part, the debts, contracts, liabilities or torts of the Participant, nor
shall they be subject to garnishment, attachment, execution, levy or other legal
or equitable process.
9. CERTAIN LEGAL RESTRICTIONS. The Corporation shall not be obligated to
sell or issue any shares of Common Stock upon the exercise of the Option or
otherwise unless the issuance and delivery of such shares shall comply with all
relevant provisions of law and other legal requirements including, without
limitation, any applicable federal or state securities laws and the requirements
of any stock exchange upon which shares of the Common Stock may then be listed.
As a condition to the exercise of the Option or the sale by the Corporation of
any additional shares of Common Stock to the Participant, the Corporation may
require the Participant to make such representations and warranties as may be
necessary to assure the availability of an exemption from the registration
requirements of applicable federal or state securities laws. The Corporation
shall not be liable for refusing to sell or issue any shares if the Corporation
cannot obtain authority from the appropriate regulatory bodies deemed by the
Corporation to be necessary to lawfully sell or issue such shares. In addition,
the Corporation shall have no
obligation to the Participant, express or implied, to list, register or
otherwise qualify any of the Participant's shares of Common Stock. The shares
of Common Stock issued upon the exercise of the Option may not be transferred
except in accordance with applicable federal or state securities laws. At the
Corporation's option, the certificate evidencing shares of Common Stock issued
to the Participant may be legended as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE APPLICABLE SECURITIES
LAWS OF ANY STATE OR OTHER JURISDICTION AND MAY NOT BE SOLD, ASSIGNED,
TRANSFERRED OR PLEDGED EXCEPT IN COMPLIANCE WITH THE REQUIREMENTS OF SUCH ACT
AND THE APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION.
Any Common Stock issued pursuant to the exercise of Options granted
pursuant to this Agreement to a person who would be deemed an officer or
director of the Corporation under Rule 16b-3 shall not be transferred until at
least six months have elapsed from the date of grant of such Option to the date
of disposition of the Common Stock underlying such Option, unless, at the time
of transfer, the Participant is not subject to the provisions of Section 16 of
the Exchange Act.
10. PLAN INCORPORATED. The Participant accepts the Option subject to all
the provisions of the Plan, which are incorporated into this Agreement,
including the provisions that authorize the Committee to administer and
interpret the Plan and which provide that the Committee's decisions,
determinations and interpretations with respect to the Plan are final and
conclusive on all persons affected thereby. Except as otherwise set forth in
this Agreement, terms defined in the Plan have the same meanings herein.
11. MISCELLANEOUS.
(a) The Option is intended to be a non-qualified stock option under
applicable tax laws, and it is not to be characterized or treated as an
incentive stock option under such laws.
(b) The granting of the Option shall impose no obligation upon the
Participant to exercise the Option or any part thereof. Nothing contained in
this Agreement shall affect the right of the Corporation to terminate the
Participant at any time, with or without cause, or shall be deemed to create any
rights to employment on the part of the Participant.
(c) The rights and obligations arising under this Agreement are not
intended to and do not affect the employment relationship that otherwise exists
between the Corporation and the Participant, whether such employment
relationship is at will or defined by an employment contract. Moreover, this
Agreement is not intended to and does not amend any existing employment contract
between the Corporation and the Participant; to the extent there is a conflict
between this Agreement and such an employment contract, the employment contract
shall govern and take priority.
(d) Neither the Participant nor any person claiming under or through
the Participant shall be or shall have any of the rights or privileges of a
stockholder of the Corporation in respect of any of the shares issuable upon the
exercise of the Option herein unless and until certificates representing such
shares shall have been issued and delivered to the Participant or such
Participant's agent.
(e) Any notice to be given to the Corporation under the terms of this
Agreement or any delivery of the Option to the Corporation shall be addressed to
the Corporation at its principal executive offices, and any notice to be given
to the Participant shall be addressed to the Participant at the address set
forth beneath his or her signature hereto, or at such other address for a party
as such party may hereafter designate in writing to the other. Any such notice
shall be deemed to have been duly given if mailed, postage prepaid, addressed as
aforesaid.
(f) Subject to the limitations in this Agreement on the
transferability by the Participant of the Option and any shares of Common Stock,
this Agreement shall be binding upon and inure to the benefit of the
representatives, executors, successors or beneficiaries of the parties hereto.
(g) THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT
SHALL BE GOVERNED BY THE LAWS OF THE STATE OF DELAWARE AND THE UNITED STATES, AS
APPLICABLE, WITHOUT REFERENCE TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
(h) If any provision of this Agreement is declared or found to be
illegal, unenforceable or void, in whole or in part, then the parties shall be
relieved of all obligations arising under such provision, but only to the extent
that it is illegal, unenforceable or void, it being the intent and agreement of
the parties that this Agreement shall be deemed amended by modifying such
provision to the extent necessary to make it legal and enforceable while
preserving its intent or, if that is not possible, by substituting therefor
another provision that is legal and enforceable and achieves the same
objectives.
(i) All section titles and captions in this Agreement are for
convenience only, shall not be deemed part of this Agreement, and in no way
shall define, limit, extend or describe the scope or intent of any provisions of
this Agreement.
(j) The parties shall execute all documents, provide all information,
and take or refrain from taking all actions as may be necessary or appropriate
to achieve the purposes of this Agreement.
(k) This Agreement constitutes the entire agreement among the parties
hereto pertaining to the subject matter hereof and supersedes all prior
agreements and understandings pertaining thereto.
(l) No failure by any party to insist upon the strict performance of
any covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy
consequent upon a breach thereof shall constitute waiver of any such breach or
any other covenant, duty, agreement or condition.
(m) This Agreement may be executed in counterparts, all of which
together shall constitute one agreement binding on all the parties hereto,
notwithstanding that all such parties are not signatories to the original or the
same counterpart.
(n) At any time and from time to time the Committee may execute an
instrument providing for modification, extension, or renewal of any outstanding
option, provided that no such modification, extension or renewal shall (i)
impair the Option in any respect without the consent of the holder of the Option
or (ii) conflict with the provisions of Rule 16b-3. Except as provided in the
preceding sentence, no supplement, modification or amendment of this Agreement
or waiver of any provision of this Agreement shall be binding unless executed in
writing by all parties to this Agreement. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provision of this Agreement (regardless of whether similar), nor shall any such
waiver constitute a continuing waiver unless otherwise expressly provided.
(o) In addition to all other rights or remedies available at law or
in equity, the Corporation shall be entitled to injunctive and other equitable
relief to prevent or enjoin any violation of the provisions of this Agreement.
(p) The Participant's spouse joins this Agreement for the purpose of
agreeing to and accepting the terms of this Agreement and to bind any community
property interest he or she has or may have in the Option, any vested portion or
any unvested portion of the Option, any shares of Common Stock acquired upon
exercise of the Option and any other shares of Common Stock held by the
Participant.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SUIZA FOODS CORPORATION
By:
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Xxxxx X. Xxxxxx
Chairman of the Board
PARTICIPANT:
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Name:
Address:
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Fax:
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PARTICIPANT'S SPOUSE:
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Name:
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