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Exhibit
10.23
Performance-Vested Option
Agreement
CHILL HOLDINGS,
INC.
STOCK OPTION GRANT
NOTICE
2008 STOCK INCENTIVE
PLAN
Chill Holdings, Inc. (the
“Company”), pursuant to the Chill Holdings, Inc. 2008
Stock Incentive Plan (“Plan”), hereby grants to the
“Optionholder” identified below a Nonstatutory Stock
Option to purchase the number of shares of the Company’s
Common Stock (“Shares”) set forth below. This Option is
subject to all of the terms and conditions as set forth herein and
in the Option Agreement, the Plan and the Management Stockholders
Agreement, all of which are attached hereto and incorporated herein
in their entirety. Any capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the
Plan.
Optionholder:
Date of Grant:
Vesting Commencement Date: [
], 2008
Number of Shares Subject to
Option:
Exercise Price (Per Share): $
Total Exercise Price: $
Expiration Date:
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| Exercise Schedule: |
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Same as Vesting
Schedule. |
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| Vesting
Schedule: |
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As set forth in the Vesting Rules
Exhibit attached hereto. |
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| Payment: |
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By cash or check
(unless otherwise permitted by the Committee) |
Additional
Terms/Acknowledgements: The undersigned Optionholder
acknowledges receipt of, and understands and agrees to, this Grant
Notice, the Option Agreement, the Management Stockholders Agreement
and the Plan. Optionholder further acknowledges that as of the Date
of Grant, this Grant Notice, the Option Agreement, the Management
Stockholders Agreement and the Plan set forth the entire
understanding between Optionholder and the Company regarding the
acquisition of Shares and supersede all prior oral and written
agreements on that subject with the exception of (i) options
previously granted and delivered to Optionholder under the Plan,
and (ii) the agreements, if any, listed below:
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| Chill Holdings, Inc. |
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OPTIONHOLDER |
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| By: |
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Signature |
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Signature |
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| Title: |
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Date: |
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| Date: |
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Attachments: Option Agreement, 2008
Stock Incentive Plan and Management Stockholders
Agreement
1
VESTING RULES
EXHIBIT
1.
Definitions
(a) “ EBITDA
” shall mean the “Consolidated EBITDA,” as such
term is defined in the Term Loan Credit Agreement dated as of
February 13, 2008 among Chill Acquisition, Inc., Goodman
Global, Inc., and the several lenders from time to time party
thereto (the “Credit Agreement”).
(b) “GAAP” shall
have the meaning ascribed to such term in the Credit
Agreement.
2. Performance
Targets
The performance targets as
set forth in Schedule A (the “EBITDA Targets”)
will be adjusted by the Committee in good faith to reflect each
acquisition or disposition by the Company or any of its Affiliates
subsequent to the date of this Performance Option of any business,
operation, entity (including the acquisition of only a portion of
an entity whose results will be consolidated by Goodman Global,
Inc. in accordance with GAAP), division of any entity or any assets
outside the ordinary course of business. If the Company makes such
an acquisition or disposition in a given year, the EBITDA Target
for such year and subsequent years, if applicable, shall be
proportionately adjusted, fairly and appropriately, and only to the
extent deemed necessary by the Committee (after consultation with
the Company’s accountants), in the exercise of its good faith
judgment, in order to accurately reflect the direct and measurable
effect such acquisition or disposition has or is reasonably
expected to have on such EBITDA Target(s). In addition, to the
extent applicable, EBITDA Target(s) will be adjusted by the
Committee (after consultation with the Company’s accountants)
in good faith to reflect any changes in GAAP promulgated by
accounting standard setters in order to accurately reflect the
effect of such changes on such EBITDA Target(s). The intent of such
adjustments is to keep the probability of achieving the EBITDA
Targets the same as if the event triggering such adjustment had not
occurred. The Committee’s determination of such necessary
adjustment(s) shall be made within 90 days following the completion
or closing of such event, as applicable, and shall be based on the
Company’s accounting as set forth in its books and records
and on the Company’s financial plan pursuant to which the
EBITDA Targets were originally established. Any such adjustment(s)
made in good faith shall be final and binding on all
persons.
3. Vesting
Rules
Subject to the terms and
conditions of the attached Option Agreement, the following rules
shall apply to the vesting of the Performance Option:
(a) Subject to the
Optionholder’s Continuous Service, an installment consisting
of twenty percent (20%) of the shares covered by the
Performance Option shall become vested on December 31 of each
calendar year 2008 through 2012 if the EBITDA as of such
December 31 equals or exceeds the applicable EBITDA Target for
such year; provided that such installment shall not become vested
until the EBITDA as of such December 31 has been
determined.
1
(b) If the EBITDA as of the
end of any calendar year 2008 through 2012 is less than the
applicable EBITDA Target with respect to such year (any such year,
a “ Missed Year ”), that portion of the
Performance Option that was subject to vesting pursuant to
paragraph 3(a) with respect to the Missed Year (and which did
not become vested with respect to such Missed Year) shall become
vested on December 31 of the calendar year immediately
following the Missed Year, if it is determined by the Committee
that the EBITDA as of such immediately following December 31
equals or exceeds the applicable EBITDA Target for the calendar
year immediately following the Missed Year.
(c) The Committee shall make
the determination in good faith as to whether the respective EBITDA
Targets have been met, and shall determine the extent, if any, to
which the Option has become exercisable, on any such date after the
applicable date of determination as the Committee in its sole
discretion shall determine; provided that the determination of
EBITDA shall be made by the Committee after the independent
auditors of the Company or its Affiliates have delivered their
audit report with respect to such fiscal year to the Committee and
will be based upon the financial information reflected in such
audited financial statements. The Committee’s good faith
determination as to whether the EBITDA Targets have been met shall
be final, conclusive and binding on the Optionholder.
(d) Notwithstanding the
foregoing provisions, but subject to paragraph 3(e) below, any
portion of the Performance Option that has not theretofore become
vested and exercisable shall, to the extent not previously
cancelled or terminated, subject to the Optionholder’s
Continuous Service through a Change in Control, become fully vested
and exercisable immediately prior to the effective date of a Change
in Control.
(e) Notwithstanding the
foregoing, but subject to Section 6(b) of the Option
Agreement, no Performance Option which is unexerciseable at or
following the termination of the Optionholder’s Continuous
Service shall thereafter become exercisable.
2
CHILL HOLDINGS,
INC.
2008 STOCK INCENTIVE
PLAN
OPTION
AGREEMENT
(PERFORMANCE-BASED STOCK
OPTION)
Pursuant to your Stock Option
Grant Notice (“Grant Notice”) and this Option
Agreement, Chill Holdings, Inc. (the “Company”) has
granted you a stock option under the Chill Holdings, Inc. 2008
Stock Incentive Plan (the “Plan”) to purchase the
number of shares of the Company’s Common Stock indicated in
your Grant Notice at the exercise price indicated in your Grant
Notice. Capitalized terms not defined in this Option Agreement but
defined in the Plan shall have the same definitions as in the Plan.
For the avoidance of doubt, the terms and conditions of the Grant
Notice are a part of the Option Agreement, unless otherwise
specified.
The details and terms and
conditions of this Option Agreement shall govern your Nonstatutory
Stock Option:
1. Vesting . Subject
to the limitations contained herein, your Option will vest as set
forth in your Grant Notice, provided that vesting will cease upon
the termination of your Continuous Service. For the purposes of
this Option Agreement, in the event of an involuntary termination
of Continuous Service, the termination shall be effective, and
vesting shall cease, as of the date stated in the relevant notice
of termination and, unless otherwise required by law, will not be
extended by any notice period or other period of leave. Subject to
Applicable Law, the Company shall determine the date of termination
in its sole discretion.
2. Number of Shares and
Exercise Price . The number of shares of Common Stock subject
to your Option and your exercise price per share referenced in your
Grant Notice may be adjusted from time to time for various
adjustme
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