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Exhibit 10.3 NON -Q UALIFIED STOCK OPTION AGREEMENT

Option Agreement

Exhibit 10.3 NON -Q UALIFIED STOCK OPTION AGREEMENT | Document Parties: ZEBRA TECHNOLOGIES CORP/DE | 2006 Zebra Technologies Corporation You are currently viewing:
This Option Agreement involves

ZEBRA TECHNOLOGIES CORP/DE | 2006 Zebra Technologies Corporation

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Title: Exhibit 10.3 NON -Q UALIFIED STOCK OPTION AGREEMENT
Governing Law: Delaware     Date: 9/4/2007
Industry: Misc. Capital Goods     Sector: Capital Goods

Exhibit 10.3 NON -Q UALIFIED STOCK OPTION AGREEMENT, Parties: zebra technologies corp/de , 2006 zebra technologies corporation
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Exhibit 10.3

N ON -Q UALIFIED S TOCK O PTION A GREEMENT

This NON-QUALIFIED STOCK OPTION AGREEMENT (this “Option Agreement”), dated as of September 4, 2007 (the “Grant Date”), is between ZEBRA TECHNOLOGIES CORPORATION, a Delaware corporation (the “Company”), and ANDERS GUSTAFSSON (the “Participant”), relating to a non-qualified stock option granted under the 2006 Zebra Technologies Corporation Incentive Compensation Plan (the “Plan”). Capitalized terms used in this Option Agreement without definition shall have the meanings ascribed to such terms in the Plan.

 

1. Grant of Option .

 

  (a)

Grant . Subject to the provisions of this Option Agreement and pursuant to the provisions of the Plan, the Company hereby grants to the Participant as of the Grant Date a Non-Qualified Stock Option (the “Option”) to purchase 75,000 shares (the “Option Shares”) of the Company’s Class A Common Stock, $.01 par value per share (the “Stock”), at a price of $________ per share (the “Option Price”).

 

  (b)

Term of the Option . Unless the Option terminates earlier pursuant to other provisions of the Option Agreement, the Option shall expire on the tenth anniversary of the Grant Date (the “Expiration Date”).

 

  (c)

Nontransferability . The Option shall be non-transferable, except by will or the laws of descent and distribution, or as otherwise permitted under the Plan.

 

2. Vesting of Option .

 

  (a)

General Vesting Rule . Prior to the Expiration Date, the Option shall become and be exercisable as follows:

 

Grant Date Anniversary

   Percentage of Option Exercisable

Prior to the first anniversary

of the Grant Date

   0%

On or after the first anniversary

of the Grant Date

   25%

On or after the second anniversary

of the Grant Date, an additional

   25%

On or after the third anniversary

of the Grant Date, an additional

   25%

On or after the fourth anniversary

of the Grant Date, an additional

   25%

 


provided, however, except as otherwise provided for under this Option Agreement or the Employment Agreement between the Company and the Participant effective as of September 4, 2007 (the “Employment Agreement”), the Participant must remain employed by the Company or any Subsidiary continuously through the applicable vesting dates.

 

  (b)

Death or Disability . In the event the Participant’s employment with the Company and/or any Subsidiary is terminated due to death or Disability, any unvested Option Shares as of the date of the Participant’s termination of employment shall immediately become fully vested and exercisable and, along with unexercised vested Option Shares, shall remain exercisable until the earlier of:

 

  (i)

the Expiration Date; or

 

  (ii)

one (1) year after the date of the Participant’s termination of employment due to death or Disability.

In the event of the Participant’s death, the Participant’s beneficiary or estate may exercise the vested Option Shares.

 

  (c)

Retirement . In the event the Participant’s employment with the Company and/or any Subsidiary is terminated due to Retirement, any unexercised, vested Option Shares as of the date of Participant’s termination of employment shall remain exercisable until the earlier of:

 

  (i)

the Expiration Date; or

 

  (ii)

one (1) year after the date of the Participant’s termination of employment due to Retirement.

For purposes of this Option Agreement, “Retirement” means the Participant’s voluntary termination of employment with the Company and/or any Subsidiary after attaining either:

 

   

age 55 with ten (10) complete years of service or more with the Company and/or any Subsidiary; or

 

   

age 65.

 

  (d)

Termination for Cause . In the event the Participant’s employment with the Company and/or any Subsidiary is terminated for Cause, all unvested Option Shares and all unexercised, vested Option Shares shall expire immediately, be forfeited and considered null and void. “Cause” shall have the meaning assigned to it in the Participant’s Employment Agreement.

 

2

 


  (e)

Other Termination of Employment . In the event the Participant’s employment with the Company and/or any Subsidiary is terminated for any reason other than as provided in Sections 2(b), (c) or (d) hereof, vesting of the Participant’s Option Shares shall be governed by the Employment Agreement and any unexercised, vested Option Shares as of the date of Participant’s termination of employment shall remain exercisable until the earlier of:

 

  (i)

the Expiration Date; or

 

  (ii)

ninety (90) days after the date of the Participant’s involuntary (as to the Participant) termination of employment for reasons other than death, Disability, Retirement, or Cause; or

 

  (iii)

thirty (30) days after the Participant’s voluntary termination of employment for reasons other than Retirement.

 

  (f)

Change in Control Vesting . Subject to the provisions of Section 15 of the Plan, if a Change in Control occurs, 100% of the remaining unvested Option Shares shall be immediately vested and exercisable upon the Change in Control and, along with unexercised vested Option Shares, shall remain exercisable through the Expiration Date.

 

3. Exercise of Option .

 

  (a)

Manner of Exercise . The vested Option Shares may be exercised, in whole or in part, by delivering written notice to the Company in accordance with Section 7(k) hereof and in such form as the Company may require from time to time. Such notice of exercise shall:

 

  (i)

specify the number of Option Shares to be purchased;

 

  (ii)

specify the aggregate Option Price for such Option Shares; and

 

  (iii)

be accompanied by payment in full of such aggregate Option Price.

 

  (b)

Payment Upon Exercise . The Option Price upon exercise of any Option Shares shall be payable to the Company in full either:

 

  (i)

in cash or its equivalent;

 

  (ii)

by tendering previously acquired Stock that has been held for at least six months (or such longer period to avoid a charge to earnings for financial reporting purposes) and having an aggregate Fair Market Value at the time of exercise equal to the total Option Price, or

 

  (iii)

a combination of Sections 3(b)(i) and (ii) hereof.

 

3

 


In addition, payment of the Option Price may be payable by one or more of the following methods either upon written consent from the Committee or if one or more of the following methods will not result in a charge to earnings for financial reporting purposes:

 

  (iv)

by withholding Stock that otherwise would be acquired on exercise having an aggregate Fair Market Value at the time of exercise equal to the total Option Price;

 

  (v)

by tendering other Awards payable under the Plan;

 

  (vi)

by cashless exercise through delivery of irrevocable instructions to a broker to promptly deliver to the Company the amount of proceeds from a sale of shares having a Fair Market Value equal to the total Option Price; or

 

  (vii)

any combination of Sections 3(b)(i)-(vi) upon written consent of the Committee.

 

  (c)

Compliance with Federal and State Law . The Company reserves the right to delay a Participant’s exercise of an Option if (1) the Company’s issuance of Stock upon such exercise would violate any applicable federal or state securities laws or any other applicable laws or regulations, or (2) the Company reasonably determines that issuance of Stock would not be deductible under Code Section 162(m). The Participant may not sell or otherwise dispose of the Option Shares in violation of any applicable law. The Company may postpone issuing and delivering any Option Shares for so long as the Company reasonably determines to be necessary to satisfy the following:

 

  (i)

its completing or amending any securities registration or qualification of the Option Shares or it or the Participant satisfying any exemption from registration under any federal or state law, rule, or regulation;

 

  (ii)

its receiving proof it considers satisfactory that a person seeking to exercise the Option after the Participant’s death is entitled to do so;

 

  (iii)

the Participant complying with any requests for representations under the Plan; and

 

  (iv)

the Participant complying with any federal, state or local tax withholding obligations.

 

  (d)

No Fractions of Stock . The Company shall not be required to issue any fractional shares of Stock.

 

4.

Payment of Taxes . If the Company is obligated to withhold an amount on account of any tax imposed as a result of the exercise of an Option, the Participant shall be required to pay such amount to the Company, as provided under Section 17 of the Plan. The

 

4

 


 

Participant acknowledges and agrees that the Participant is responsible for the tax consequences associated with the grant of the Option and its exercise.

 

5.

Changes in Company’s Capital Structure . To prevent dilution or enlargement of rights, the Committee shall make or authorize to be made an adjustment in the number and class of Option Shares and/or the Option Price to prevent dilution or enlargement of rights, as a result of the following:

 

  (i)

any adjustment, recapitalization, reorganization or other changes in the Company’s capital structure or its business;

 

  (ii)

any merger or consolidation of the Company;

 

  (iii)

any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Company’s Common Stock or the rights thereof;

 

  (iv)

the dissolution or liquidation of the Company;

 

  (v)

any sale or transfer of all or any part of the Company’s assets or business; or

 

  (vi)

any other corporate act or proceeding, whether of a similar character or otherwise.

 

6.

Confidentiality, Non-Solicitation and Non-Compete . Participant agrees to, understands and acknowledges the following:

 

  (a)

Confidential Information . Participant will be furnished, use or otherwise have access to certain Confidential Information of the Company. For purposes of this Option Agreement, Confidential Information means any and all financial, technical, commercial or other information concerning the business and affairs of the Company that is confidential and proprietary to the Company, including without limitation,

 

  (i)

information relating to the Company’s past and existing customers and vendors and development of prospective customers and vendors, including specific customer product requirements, pricing arrangements, payment terms, customer lists and other similar information;

 

  (ii)

inventions, designs, methods, discoveries, works of authorship, creations, improvements or ideas developed or otherwise produced, acquired or used by the Company;

 

  (iii)

the Company’s proprietary programs, processes or software, consisting of but not limited to, computer programs in source or object code and all related documentation and training materials, including all upgrades, updates, improvements, derivatives and modifications thereof and

 

5

 



 
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