EXHIBIT 10 (m)
ALBERTO-CULVER
COMPANY
EMPLOYEE STOCK OPTION PLAN OF
2006
The Alberto-Culver Company Employee
Stock Option Plan of 2006 (hereinafter called the
“ACSOP”) is intended to encourage ownership of the
Common Stock of Alberto-Culver Company (the “Company”)
by eligible key employees of the Company and its subsidiaries and
to provide incentives for them to make maximum efforts for the
success of the business. Options granted under the ACSOP will be
non-qualified options (not incentive options as defined in
Section 422 of the Internal Revenue Code of 1986 and the rules
and regulations promulgated thereunder (the “Code”)).
At the time of approval by the stockholders of the Company, the
name of the Company was New Aristotle Holdings, Inc. Following the
time of approval, the name of the Company will be changed to
Alberto-Culver Company.
Key employees of the Company and its
subsidiaries who perform services which contribute materially to
the management, operation and development of the business
(“Optionees”) will be eligible to receive options under
the ACSOP.
The Compensation and Leadership
Development Committee of the Board of Directors of the Company (the
“Committee”) shall have full power and authority,
subject to the express provisions of the ACSOP, to determine the
purchase price of the stock covered by each option, the Optionees
to whom and the time or times at which options shall be granted,
the terms and conditions of the options, including the terms of
payment thereof, and the number of shares of stock to be covered by
each option. The Committee shall have full power to construe,
administer and interpret the ACSOP, and full power to adopt such
rules and regulations as the Committee may deem desirable to
administer the ACSOP. No member of the Committee shall be liable
for any action or determination made in good faith with respect to
the ACSOP or any option thereunder. Determinations by the Committee
under the ACSOP need not be uniform and may be made by it
selectively among Optionees, whether or not such persons are
similarly situated. The determination of the Committee as to any
disputed question arising under the ACSOP, including questions of
construction and interpretation, shall be final, conclusive and
binding.
The Committee may, in its
discretion, delegate to a committee of member(s) of the Committee
its authority with respect to such matters under the ACSOP and
options granted under the ACSOP as the Committee may
specify.
The Committee shall be comprised
solely of members each of whom shall be an “outside
director” within the meaning of Section 162(m) of the
Code, and a “non-employee director” within the meaning
of Section 16 (“Section 16”) of the Securities
Exchange Act of 1934 and the rules and
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regulations thereunder (“Exchange
Act”), provided, however, that if any member of the Committee
is not (i) an “outside director” within the
meaning of Section 162(m) of the Code or (ii) a
“non-employee director” within the meaning of
Section 16, the Committee shall set up a subcommittee
comprised solely of outside directors and non-employee directors
for purposes of all matters arising under this ACSOP involving
“officers” within the meaning of Rule 16a-1(f) under
Section 16, and “covered employees” within the
meaning of Section 162(m) of the Code for the plan year at
issue.
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4.
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Number of Shares of Stock to
be Offered
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The Committee may authorize from
time to time the issuance pursuant to the ACSOP of shares not to
exceed 9,000,000 of the Company’s Common Stock in the
aggregate plus the number of shares of the Company’s Common
Stock subject to Substitute Options as provided in Section 14,
subject to adjustment under paragraph 10 hereof. Such shares of
Common Stock which may be issued pursuant to options granted under
the ACSOP may be authorized and unissued shares or issued and
reacquired shares as the Committee from time to time may determine.
If any option granted under the ACSOP shall terminate or be
surrendered or expire unexercised in whole or in part, the shares
of stock so released from such option may be made the subject of
additional options granted under the ACSOP. In addition, any shares
of Common Stock withheld to pay, in whole or in part, the amount
required to be withheld under applicable tax laws in accordance
with paragraph 7(d) hereof, may be made the subject of additional
options granted under the ACSOP.
The purchase price under each option
granted pursuant to the ACSOP shall be determined by the Committee
but shall not be less than the Fair Market Value (as defined below)
of the Company’s Common Stock on the date the option is
granted. For purposes of the ACSOP, “Fair Market Value”
shall mean the average of the high and low transaction prices of a
share of Common Stock of the Company as reported in the New York
Stock Exchange Composite Transactions on the date as of which such
value is being determined or, if there shall be no reported
transactions for such date, on the next preceding date for which
transactions were reported.
The Committee may not grant to any
individual Optionee in any fiscal year an option or options with
respect to more than 600,000 shares of Common Stock.
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7.
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Term and Exercise of
Options
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(a) Each option granted shall
provide that it is not exercisable after the expiration of ten
(10) years from the date the option is granted, or such
shorter period as the Committee determines, and each option shall
be subject to the following limitations with respect to its
exercise:
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(i)
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Except as otherwise provided in
paragraphs 7(b), 8(a) or 11(a) hereof, no option may be exercised
until the day preceding the anniversary date of the grant of the
option.
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(ii)
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Except as otherwise provided in
paragraphs 7(b), 8(a) or 11(a) hereof, on the day preceding the
anniversary date of the grant of the option in each of the four
calendar years immediately following the year of the grant of the
option, the right to purchase twenty-five percent (25%) of the
total number of shares of stock specified in the option shall
accrue to the Optionee. Subject to paragraph 8 hereof, each such
right to purchase may be exercised, in whole or in part, at any
time after such right accrues and prior to the expiration of the
term of the option.
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(b) Notwithstanding the foregoing or
paragraph 8 hereof, the Committee may in its discretion
(i) specifically provide at the date of grant for another time
or times of exerciseability; (ii) at any time prior to the
expiration or termination of any option previously granted,
accelerate the exercisability of any option subject to such terms
and conditions as the Committee deems necessary or appropriate to
effectuate the purpose of the ACSOP; or (iii) at any time
prior to the expiration or termination of any option previously
granted, extend the term of any option (including such options held
by officers or directors) for such additional period as the
Committee, in its discretion, shall determine; provided that the
term of an option shall not be extended beyond the later of the
fifteenth day of the third month following the date on which the
option would otherwise have expired, or the last day of the
calendar year in which the option would otherwise have expired (or
such other date as may be permitted by final regulations issued
under Section 409A of the Code). In no event, however, shall
the aggregate option period with respect to any option, including
the original term of the option and any extensions thereof, exceed
ten years.
(c) An option may be exercised
(subject to the receipt of payment) by giving written notice to the
Company specifying the number of shares to be purchased. The full
purchase price for such shares may be paid (i) in cash,
(ii) by check, (iii) by delivery of previously owned
shares of Common Stock, or (iv) by a combination of these
methods of payment. However, under no circumstances may any
Optionee deliver previously owned shares of Common Stock obtained
from the exercise of stock options under any option plan of the
Company or the vesting of shares restricted under any restricted
stock plan of the Company or the Management Bonus Plan during the
six months immediately preceding the exercise date. Payment must be
received by the Company before any exercise is consummated. For
purposes of the delivery of previously owned shares of Common
Stock, the per share value of such shares shall be the Fair Market
Value on the date of exercise.
(d) At any time when an Optionee is
required to pay to the Company an amount required to be withheld
under applicable tax laws in connection with the exercise of an
option (calculated by taking the minimum statutory withholding
rates for federal, foreign, state and local tax purposes including
payroll taxes, applicable to the income generated by the Optionee
by such exercise), the Optionee may satisfy this obligation
(i) in cash, (ii) by check, (iii) by delivery of
previously owned shares of Common Stock, (iv) by making an
election to have the Company withhold shares of Common Stock, or
(v) by a combination of these methods of payment, in each case
having a value equal to the amount required to be withheld. The
Optionee must specify the method of satisfying this obligation on
or before the date of exercise. The value of the shares to be
withheld or delivered shall be based on the Fair Market Value of
the Common Stock on the date of exercise.
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8.
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Continuity of
Employment
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(a) Each option shall be subject to
the following in addition to the restrictions set forth in
paragraphs 6 and 7 hereof:
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(i)
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Upon the death of an Optionee,
all unvested options shall immediately vest and the executors or
administrators of his or her estate or legatees or distributees
shall have the right during the one (1) year period following
his or her death (but not after the expiration of the term of such
option) to exercise any unexercised options.
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(ii)
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Upon an Optionee’s
termination of employment due to disability, all unvested options
shall immediately vest and the Optionee’s option shall
terminate one (1) year after his or her termination of
employment (but not after the expiration of the term of such
option). For purposes of the ACSOP, “disability” shall
have the meaning provided in the Company’s applicable
long-term disability plan and such disability continues for more
than three months or, in the absence of such a definition, when an
Optionee becomes totally disabled as determined by a physician
mutually acceptable to the Optionee and the Committee before
attaining the age of retirement as defined below and if such total
disability continues for more than three months. Disabi
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