EXHIBIT 10.18
AEI HOLDING COMPANY, INC. STOCK OPTION PLAN
STOCK OPTION AGREEMENT
This is a STOCK OPTION AGREEMENT (the "Agreement"), effective as of
February 5, 1998 (the "Grant Date"), by and between AEI Holding Company, Inc., a
Delaware corporation (the "Company"), and (the "Optionee").
Recitals
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A. The Board of Directors (the "Board") and the shareholders of the
Company approved and adopted the AEI Holding Company, Inc. Stock Option Plan
(the "Plan").
B. The Benefits Committee (the "Committee") has determined that it is in
the best interests of the Company and appropriate to the stated purposes of the
Plan that the Company grant to the Optionee an option to purchase shares of the
Company's common stock ("Shares") pursuant and subject to the terms,
definitions, and conditions of the Plan.
C. Any capitalized terms used but not defined herein shall have the
respective meanings given them in the Plan, a copy of which is attached hereto
and incorporated by reference herein in its entirety.
NOW, THEREFORE, the Company and the Optionee do hereby agree as follows:
SECTION 1 -- GRANT OF OPTION
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Subject to the terms and conditions of this Agreement, the Company hereby
grants to the Optionee an option (the "Option") to purchase from time to time
all or any portion of Shares as set forth below:
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TYPE OF OPTION NUMBER OF SHARES
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Incentive Stock Options
Non-qualified Stock Options
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The grant of the Option is contingent upon the Optionee's execution of a
Release Agreement in form and substance satisfactory to the Company.
SECTION 2 -- OPTION PRICE
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The Option Price hereunder is Sixty-Four Dollars and Forty Cents ($64.40)
per Share, which equals one hundred percent (100%) of the fair market value of a
Share, as determined in accordance with the Plan.
SECTION 3 -- DURATION OF OPTION
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Subject to such shorter period as might be provided in Section 8 of this
Agreement (related to Termination of Employment), the Option shall be
exercisable for one hundred percent (100%) of the Shares made available under
this Agreement one hundred twenty (120) days after the Grant Date. Once
exercisable, an Option shall remain exercisable until the tenth (10th)
anniversary of the Grant Date, unless this Agreement is sooner terminated
pursuant to Section 11.
SECTION 4 -- EXERCISE OF OPTION
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During the Option Period, the Optionee may exercise the Option upon
compliance with the following additional terms:
(a) Method of Exercise. The Optionee shall exercise portions of the Option
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by written notice, which shall:
(i) State the election to exercise the Option, the number of Shares
in respect of which it is being exercised, and the Optionee's address and social
security number;
(ii) Contain such representations and agreements, if any, as the
Committee may require concerning the holder's investment intent regarding such
Shares;
(iii) Acknowledge and accept the restrictions on transfer of the
Option Stock as set forth in Section 9 of the Plan;
(iv) State that the Optionee shall, with respect to any shares of
stock of AEI Holding Company, Inc. or any of its Subsidiaries (but not with
respect to shares of stock of any parent of AEI Holding Company, Inc.) and as
long as any credit facility or loan is existing or owing to NationsBank by the
Company, its Subsidiaries or its Parent, execute and deliver to NationsBank a
Pledge Agreement as set forth in Section 7 of the Plan;
(v) Be signed by the Optionee; and
(vi) Be delivered in person or by certified mail to the Chairman of
the Committee.
(b) Payment Upon Exercise of Option. Payment in cash of the full Option
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Price for Shares upon which the Option is exercised plus any income and
employment tax withholding (if applicable) shall accompany the written notice of
exercise described above. The Company shall cause to be issued and delivered to
the Optionee the certificate(s) representing such Shares as soon
as practicable following the receipt of notice and payment described above,
unless such Shares must be pledged to a creditor of the Company.
SECTION 5 -- NON-TRANSFERABILITY OF OPTION
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The Option shall not be transferable or assignable by the Optionee. The
Option shall be exercisable, during the Optionee's lifetime, only by the
Optionee. The Option shall not be pledged or hypothecated in any way, and shall
not be subject to execution, attachment or similar process. Any attempted
transfer, assignment, pledge, hypothecation or other disposition of the Option
contrary to the provisions hereof, and the levy of any process upon the Option,
shall be null, void and without effect.
SECTION 6 -- EFFECT OF AMENDMENT, SUSPENSION
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OR TERMINATION OF EXISTING OPTIONS
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No amendment, suspension or termination of the Plan shall, without the
Optionee's written consent, alter or impair the Option granted under the terms
of this Agreement.
SECTION 7 -- RESTRICTIONS ON ISSUING SHARES
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Shares shall not be issued pursuant to the exercise of the Option, unless
the issuance and transferability of the Shares shall comply with all relevant
provisions of law, including, but not limited to, the (i) limitations, if any,
imposed by applicable state law; and (ii) restrictions, if any, imposed by the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder by the United
States Securities and Exchange Commission. The Committee may, in its
discretion, determine if such restrictions or such issuance of Shares so
complies with all relevant provisions of law. Any certificate issued upon
exercise of an Option shall bear the following legend (or one substantially
similar) setting forth notice of the restrictions on transfer:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND
HAVE NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR ANY STATE SECURITIES LAWS. THE SHARES MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
COMPANY THAT THE TRANSACTION WOULD NOT BE IN VIOLATION OF THE ACT OR ANY OTHER
STATE SECURITIES LAW. THESE SHARES ARE ALSO SUBJECT TO RESTRICTIONS ON
TRANSFER SET FORTH IN THE AEI HOLDING COMPANY, INC. STOCK OPTION PLAN WHICH IS
ON FILE WITH THE SECRETARY OF THE COMPANY.
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SECTION 8 -- EXERCISE AFTER TERMINATION OF EMPLOYMENT
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Upon the Optionee's Termination of Employment for any reason other than
Termination for Cause, an Option may be exercised, prior to the expiration date
of the Option as specified in Section 3, but only with respect to the number of
Shares which the Optionee could have acquired by an exercise of the Option
immediately before the Termination of Employment. The right to exercise will
expire at the earlier of the expiration of the Option Period or two (2) years
after the Optionee's Termination of Employment for any reason other than
Termination for Cause. Any Option exercised under this Section may be exercised
by the legal representative of the estate of the Optionee or by the Person(s)
who acquire the right to exercise such Option by bequest or inheritance. If the
Committee determines in a particular case that the Optionee's Termination of
Employment was the result of Termination for Cause, the right to exercise the
Option shall immediately terminate upon Termination of Employment.
"Termination for Cause" shall mean: (i) in the case of an Optionee who is
an Employee, a termination by the employer of the Optionee's employment for
"cause," as defined by any applicable contract of employment, or, if not defined
therein (or following termination of any such contract of employment), for
Cause, as defined below; and (ii) in the case of an Optionee who is or which is
an Advisor, a termination of the services relationship by the hiring party for
"cause" or breach of contract, as defined by any applicable contract of
engagement between the parties, or, if not defined therein (or following
termination of any such contract of engagement), for Cause, as defined below.
For purposes of this Agreement, "Cause" shall mean that one or more of the
following has occurred: (a) the commission by the Optionee of any act
materially detrimental to the Company, a Subsidiary or a Parent, including
fraud, embezzlement, theft, bad faith, gross negligence, recklessness or willful
misconduct; (b) incompetence or repeated failure or refusal to perform the
duties required of the Optionee by the Company, a Subsidiary or a Parent; (c)
conviction of a felony or of any crime of moral turpitude to the extent
materially detrimental to the Company, a Subsidiary or a Parent; or (d) any
material misrepresentation by the Optionee to the Company, a Subsidiary or a
Parent regarding the operation of the business, provided that the action or
conduct described in clause (b) above will constitute "Cause" only if such
action or conduct continues after the Company, a Subsidiary or a Parent has
provided the Optionee with written notice thereof and a reasonable opportunity
(to be not less than thirty (30) days) to cure the same.
SECTION 9 -- RESTRICTIONS ON TRANSFER OF SHARES
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Shares issued pursuant to the exercise of the Option shall be subject to
the restrictions on transfer set forth in Section 9 of the Plan.
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SECTION 10 -- ACKNOWLEDGMENTS
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The Optionee acknowledges receipt contemporaneously herewith of a copy of
the Plan, and the Optionee represents that he/she is familiar with the terms and
provisions thereof and hereby accepts the Option subject to all the terms and
provisions thereof. The Optionee acknowledges that nothing contained in the
Plan or this Agreement shall (a) confer upon the Optionee any rights to
employment by the Company or any corporation related to the Company; or (b)
interfere in any way with the right of the Company, any Subsidiary or any Parent
to terminate the Optionee's employment or advisory relationship with the Company
or such Subsidiary or Parent or change the Optionee's compensation at any time.
The Optionee further acknowledges that, notwithstanding any information provided
in this Agreement, the Plan or any documentation related to or provided in
conjunction with this Agreement or the Plan regarding the Option, the Company
has given no tax advice concerning the Option and has advised the Optionee to
consult with his or her own tax or financial advisor about the tax treatment of
the Option and its exercise.
SECTION 11 -- REPRESENTATIONS AND WARRANTIES OF OPTIONEE
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The Optionee represents and warrants that he or she is acquiring the
Option, and will acquire any Shares obtained upon exercise of the Option, for
investment purposes only, for the Optionee's own account, and with no view to
the distribution thereof.
SECTION 12 -- TERM OF AGREEMENT
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This Agreement shall terminate upon the earlier of (i) complete exercise or
termination of the Option; (ii) mutual agreement of the parties; or (iii)
expiration of the Option Period.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
effective as of the date set forth in the preamble hereto.
OPTIONEE AEI HOLDING COMPANY, INC.
By:_______________________________
Name:_____________________________
Title:____________________________
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