Exhibit 10.34
FORM B—Management
Form
(With Price Appreciation Threshold)
[MEAD JOHNSON
LETTERHEAD]
NONQUALIFIED STOCK OPTION
AGREEMENT
UNDER THE MEAD JOHNSON NUTRITION
COMPANY
2009 STOCK AWARD AND INCENTIVE PLAN
MEAD JOHNSON NUTRITION COMPANY, a
Delaware corporation (the “Company”), has granted to
you an option to purchase shares of the common stock
(“Shares”) of the Company (the “Option”),
at the specified exercise price, as set forth in the summary of
your grant that is found on the Smith Barney website (the
“Grant Summary”). The Grant Summary is incorporated
into this Nonqualified Stock Option Agreement (the
“Agreement”) and deemed to be a part hereof. The Option
will expire and cease to be exercisable at the earlier of the
stated Expiration Date set forth in the Grant Summary or, in the
event of Termination of Employment (as defined in Section 5(e)
below), the date the Option ceases to be exercisable under
Section 5. This Option is granted under Section 6(b) of,
and is subject in all respects to the terms, definitions and
provisions of, the Mead Johnson Nutrition Company 2009 Stock Award
and Incentive Plan (the “Plan”) and the terms and
conditions set forth in the Grant Summary and this
Agreement.
1. General .
The Option is subject to the terms
and conditions of the Plan and this Agreement. The Plan, and
documents constituting the prospectus relating to the Plan and this
Option, have previously been delivered to you and/or are available
on the Company’s intranet site at
http://onebms.bms.com/mjn . All of the applicable terms,
conditions and other provisions of the Plan are incorporated by
reference herein. Capitalized terms used in this Agreement but not
defined herein shall have the same meanings as assigned to such
terms in the Plan. If there is any conflict between the provisions
of this document and mandatory provisions of the Plan, the
provisions of the Plan shall govern. By accepting the grant of the
Option, you agree to be bound by all of the terms and provisions of
the Plan (as presently in effect or later amended), the rules and
regulations under the Plan adopted from time to time, and the
decisions and determinations of the Compensation Committee of the
Company’s Board of Directors (the “Committee”)
made from time to time. The Option is a nonqualified stock option
(not an incentive stock option as defined under Section 422 of
the Internal Revenue Code of 1986, as amended).
2. Vesting, Exercise
Threshold . The
Option shall vest and become exercisable as to
[ ]% of the Shares, cumulatively, on each of
the first, second, third, and fourth anniversaries of the Award
Date (rounded to the nearest whole Share), if you remain employed
by the Company or an Affiliate or Subsidiary at the vesting date;
provided, however, that the Option will become vested at other
times as specified in this Section 2 and Section 5
hereof. In addition to the vesting provisions,
[ ]% of the Option award is subject to a
price appreciation exercise threshold. The Option may only be
exercised once the Company’s common stock achieves a closing
price of at least [ ]% of the Exercise Price
and remains at or above that closing price for seven
(7) consecutive trading days during the Option term. This
price appreciation exercise threshold shall not apply in the case
of the death of the Optionee. Subject to all applicable laws,
rules, regulations and the terms of the Plan and this Agreement,
you may exercise the Option only after the time and to the extent
the
Option has become vested and exercisable and
prior to or on the Expiration Date of the Option. You must remain
in the continuous employment of the Company or Affiliates or
Subsidiaries for a period of one year following the Award Date as a
condition to your right to exercise any portion of the Option,
except as otherwise provided in Section 5. During your
employment, the stated vesting schedule set forth above shall
govern the vesting and exercisability of the Option, except that if
you have attained age 60 and met the one-year continuous employment
requirement of this Section 2(a) while employed, your Option
will be fully vested and you may exercise it in full thereafter,
subject to the price appreciation exercise threshold described
herein.
3. Option Exercise and Payment
of Exercise Price .
To exercise the Option, in whole or in part, you must notify the
Company’s designated broker/agent in the manner specified by
the Committee or its designee. This notification will be effective
upon receipt by the Company’s designated broker/agent and
must be received on or before the specified Expiration Date. If the
specified Expiration Date falls on a day that is not a regular
business day at the Company’s executive office or
broker/agent’s office, then the exercise notification must be
received on or before the last regular business day prior to the
Expiration Date.
Payment must be made in the form of
a wire transfer, personal check, or money order, payable in U.S.
dollars and on a U.S. bank to the order of the Company’s
designated broker/agent; or by authorizing the Company’s
designated broker/agent to sell the Shares acquired upon the
exercise of the Option and remit to the Company a sufficient
portion of the sale proceeds to pay the entire Exercise Price,
applicable brokerage fees, and any withholding and/or taxes and
applicable fees resulting from such exercise as described in
Section 4 hereof; or, if not problematic under local law, by
(i) delivery of a certificate or certificates for Shares owned
by you having a Fair Market Value at the date of exercise equal to
the aggregate Exercise Price being paid in this way, or
(ii) if then permitted by the Committee or its designee, by
instructing the Company to withhold from the Shares issuable upon
exercise of the Option the number of Shares having a Fair Market
Value at the date of exercise equal to the aggregate Exercise Price
being paid in this way, or in a combination of the foregoing;
provided, however, that payment in Shares under clause
(i) above will not be permitted unless at least 100 Shares are
required and delivered for such purpose. Any stock certificate or
certificates to be delivered to the Company in payment of the
Exercise Price must be endorsed, or accompanied by an appropriate
stock power, to the order of Mead Johnson Nutrition Company, with
the signature guaranteed by a bank or trust company or by a member
firm of the New York Stock Exchange. In lieu of the physical
delivery of certificates, you may submit certificates by
attestation.
No Shares will be issued pursuant to
the exercise of an Option unless such issuance and such exercise
have complied with all relevant provisions of law and requirements
of any stock exchange upon which the Shares may then be listed. As
a condition to the exercise of the Option, the Company may require
you to make any representation or warranty to the Company as may be
required under any applicable law or regulation.
4. Withholding and Employment
Taxes Upon Exercise of Option . You must pay the Company upon its demand the
amount equal to its liability, if any, for the withholding of
federal, state or local income or earnings tax or any other
applicable tax or assessment (plus interest or penalties thereon,
if any, caused by a delay in making such payment) incurred by
reason of your exercise of the
2
Option or otherwise in connection with your
Option. You may satisfy these withholding tax obligations by
authorizing the Company’s designated broker/agent to sell an
appropriate number of shares being issued on exercise to cover the
federal, state, and local income and earnings taxes, or by
directing the Company to withhold Shares out of the Option Shares
with a Fair Market Value up to but not exceeding the federal,
state, and local income and earnings taxes required to be withheld.
If, on the date of exercise, you are an “executive
officer” of the Company within the meaning of Section 16
of the Securities Exchange Act of 1934, you must pay these
withholding tax obligations in cash or use Share withholding to
satisfy the obligation to pay federal, state, and local income and
earnings taxes required to be withheld on the exercise.
5. Termination of
Employment . Except
as provided in this Section 5, any portion of the Option that
has not vested at or before the date on which you have a
Termination of Employment shall be canceled and forfeited, unless
otherwise determined by the Committee.
(a) Retirement . If
you have a Termination of Employment due to Retirement less than
one year after the Award Date, any unvested portion of the Option
will be canceled and forfeited. If you have a Termination of
Employment due to Retirement one year or more after the Award Date,
the Option will become fully vested upon your Retirement date and
you will be entitled to exercise the Option (including any portions
that vested at age 60 or otherwise vested before Retirement under
Section 2) at any time until the stated Expiration Date,
subject to Sections 6 and 7.
(b) Disability . If
you become Disabled, you will not be deemed to have a Termination
of Employment for that reason for the period during which, under
the applicable disability pay plan of the Company or an Affiliate
or Subsidiary, you are deemed to be employed and continue to
receive Disability payments. Upon the cessation of payments under
such disability pay plan, (i) if you return to employment
status with the Company or an Affiliate or Subsidiary, you will not
be deemed to have had a Termination of Employment, and (ii) if
you do not return to such employment status, you will be deemed to
have had a Termination of Employment at the date of cessation of
such Disability payments, with such Termination of Employment
treated for purposes of this Agreement as a Retirement, death, or
voluntary Termination of Employment based on your circumstances at
the time of such termination. For purposes of this Agreement,
“Disability” or “Disabled” shall mean
qualifying for and receiving payments under a disability plan of
the Company or any Affiliate or Subsidiary either in the United
States or in a jurisdiction outside of the United States, and in
jurisdictions outside of the United States shall also include
qualifying for and receiving payments under a mandatory or
universal disability plan or program managed or maintained by the
government.
(c) Death . If you die
while you are employed by the Company or an Affiliate or Subsidiary
on a date less than one year after the Award Date, the Option will
be canceled and forfeited. If you die while you are employed by the
Company or an Affiliate or Subsidiary on a date one year or more
after the Award Date, your Option will be fully vested upon your
death and your estate may exercise the Option at any time until the
stated Expiration Date, subject to Sections 6 and 7. If you die
after a Termination of Employment other than due to Retirement, and
your death occurs within the three-month post-termination exercise
period applicable under Section 5(d
