EXHIBIT 10.3
NON-QUALIFIED STOCK OPTION
AGREEMENT
PURSUANT TO THE
NBTY,
INC.
YEAR 2008 STOCK OPTION PLAN
AGREEMENT (“ Agreement ”), dated as of
,
20 , by and between NBTY, Inc., a
Delaware corporation (the “ Company ”), and
(the “ Holder
”).
Preliminary
Statement
The
Compensation and Stock Option Committee of the Board of Directors
of the Company (the “ Committee ”) has granted this
non-qualified stock option (the “ Option ”) on
,
20 (the “ Grant Date ”), subject to
the approval of
the NBTY, Inc.
Year 2008 Stock Option Plan (as the same may be amended from time
to time, the “ Plan
”) by the Company’s stockholders at the 2008 Annual
Meeting of Stockholders (including any adjournment thereof), to
purchase the number of shares of the Company’s common stock,
$0.008 par value per share (the “ Common Stock ”) set forth below
to the Holder, as an eligible employee or director of the Company or a subsidiary. If the
stockholders of the Company do not approve the Plan at the 2008
Annual Meeting of Stockholders, the Option will be null and
void. Unless otherwise indicated, any capitalized term used
but not defined herein shall have the meaning ascribed to such term
in the Plan. A copy of the Plan as in effect on the date
hereof has been delivered to the Holder. By signing and
returning this Agreement, the Holder acknowledges having received
and read a copy of the Plan as in effect on the date hereof and
agrees to comply with the Plan, this Agreement and all applicable
laws and regulations.
Accordingly, the parties hereto agree as
follows:
1.
Grant of Option .
Subject in all respects to the Plan and the terms and conditions
set forth herein and therein, the Holder is hereby granted an
option to purchase from the Company • shares of Common Stock,
at a price per share of $• (the “ Option Price ”), which may not be
less than Fair Market Value on the Grant Date.
2.
Tax Status . No part
of the Option is intended to qualify as an “incentive stock
option” under Section 422 of the Internal Revenue Code
of 1986, as amended (the “ Code ”).
3.
Vesting and Exercise
.
(a)
Except as set forth in subsection (b) below, the Option shall
vest and become exercisable in installments as provided below,
which shall be cumulative. To the extent that the Option has
become vested and exercisable as provided below, the Option
thereafter may be exercised in accordance with
Section 4 . Upon expiration of the Option, the
Option shall be canceled and no longer exercisable.
The following table indicates each date upon which the Holder shall
be vested and entitled to exercise the Option with respect to the
percentage of the shares of Common Stock indicated beside such
date, provided that the Holder has not had a termination of
employment (or, if the Holder is an outside director, a termination
in board service) (a “ Termination ”) with the Company
or any of its subsidiaries at any time prior to such date (each of
the dates set forth below being herein called a “
Vesting Date
”):
|
Vesting
Date
|
|
Total
Percentage Vested
|
|
1 st
Anniversary of Grant Date
|
|
0%
|
|
2 nd
Anniversary of Grant Date
|
|
33 1
/ 3 %
|
|
3 rd
Anniversary of Grant Date
|
|
66 2
/ 3 %
|
|
4 th
Anniversary of Grant Date
|
|
100%
|
There shall be no proportionate or partial
vesting in the periods prior to each Vesting Date and all vesting
shall occur only on the appropriate Vesting Date.
(b)
Upon the occurrence of a Change in Control (as defined in
Exhibit A hereto), the Option shall immediately become
exercisable with respect to all shares of Common Stock subject
thereto.
4.
Method of Exercise; Issuance of
Shares . (a) Subject to the provisions of
Section 3 and Section 5 , to the extent
vested, the Option may be exercised, in whole or in part, at any
time or from time to time prior to the expiration or the earlier
termination of the Option as provided herein, by giving written
notice of exercise to the Company, in form and substance
satisfactory to counsel for the Company, specifying the number of
shares of Common Stock to be purchased. Such notice shall be
accompanied by payment in full of the Option Price multiplied by
the number of shares of Common Stock underlying the portion of the
Option exercised as follows: (i) in cash or by check, bank
draft or money order payable to the order of the Company;
(ii) solely to the extent permitted by applicable law, if the
Common Stock is traded on a national securities exchange or quoted
on a national quotation system sponsored by the National
Association of Securities Dealers, and the Committee authorizes,
through a “cashless exercise” procedure whereby the
Holder delivers irrevocable instructions to a broker acceptable to
the Committee to deliver promptly to the Company an amount in cash
equal to the purchase price; (iii) by the relinquishment of a
portion of the Option or by payment in full or in part in the form
of Common Stock which, solely to the extent necessary to avoid
adverse accounting consequences for the Company, have been owned by
the Holder for a period of at least six months (and for which the
Holder has good title free and clear of any liens and encumbrances)
based on the Fair Market Value of the Common Stock on the payment
date as determined by the Committee, in its sole discretion;
(iv) by any
2
combination of the foregoing; or (v) any
other means expressly authorized by the Committee.
(b)
As promptly as is practicable after the receipt of a written notice
of exercise to the Company, in form and substance satisfactory to
counsel for the Company, payment of the Option Price and
satisfaction of applicable withholding requirements, the Company
shall issue the shares of Common Stock registered in the name of
the Holder, Holder’s authorized assignee, or Holder’s
legal representative, and shall deliver certificates representing
the shares of Common Stock with the appropriate legends affixed
thereto. The Company may postpone such delivery until it
receives satisfactory proof that the issuance of such shares of
Common Stock will not violate any of the provisions of the
Securities Act of 1933, as amended, or the Securities and Exchange
Act of 1934, as amended (the “ Exchange Act ”), or the
requirements of applicable state law relating to authorization,
issuance or sale of securities, or until there has been compliance
with the provisions of such acts or rules. The Holder
understands that the Company is under no obligation to register or
qualify the shares of Common Stock with the Securities and Exchange
Commission, any state securities commission or any stock exchange
to effect such compliance.
5.
Option Term . The
term of the Option shall be 10 years after the Grant Date and the
Option shall expire at 5:00 p.m. (Eastern Time) on the 10th
anniversary of the Grant Date, subject to earlier termination in
the event of the Holder’s Termination with the Company and
its subsidiaries as specified in Section 6
.
6.
Termination .
Subject to Section 5 and the terms of the Plan and this
Agreement, the Option shall remain exercisable as
follows:
(a)
In the event of the Holder’s Termination by reason of death
or disability (as defined in Section 22(e)(3) of the
Code), the Option, to the extent vested at the time of the
Holder’s Termination, shall remain exercisable until the
earlier of (i) one year from the date of such Termination or
(ii) the expiration of the stated term of the Option pursuant
to Section 5 hereof.
(b)
In the event of the Holder’s involuntary Termination without
“cause” (as determined by the Committee consistent with
the provisions of Section 16 of the Plan), the Option, to the
extent vested at the time of the Holder’s Termination, shall
remain exercisable until the earlier of (i) three months from
the date of such Termination or (ii) the expiration of the
stated term of the Option pursuant to Section 5
hereof.
(c)
In the event of the Holder’s voluntary Termination (other
than a voluntary termination described in Section 6(d)
below), the Option, to the extent vested at the time of the
Holder’s Termination, shall remain exercisable until the
earlier of (i) 30 days from the date of such Termination or
(ii) the expiration of the stated term of the Option pursuant
to Section 5 hereof.
(d)
In the event of the Holder’s Termination for
“cause” or in the event of the Holder’s voluntary
Termination within 90 days after an event that would be
3
grounds for a Termination for
“cause”, the Holder’s entire Option (whether or
not vested) shall be forfeited and canceled in its entirety upon
such Termination.
(e)
Any portion of the Option that is not vested as of the date of the
Holder’s Termination for any reason shall terminate and
expire as of the date of such Termination.
7.
Change in
Control . Notwithstanding the provisions of
Section 14 of the Plan, in the event of a Change in Control,
the Option shall be
treated, to the
extent determined by the Committee to be permitted under
Section 409A of the Code, in accordance with one of the following methods
as determined by the Committee in its sole discretion
: (i) the Option may
be cancelled for fair value (as determined in the sole discretion
of the Committee) which, may equal t
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