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EXHIBIT 10.1
EXECUTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT, made as of <<EffectiveDate>> (the
"Effective Date"), by
and between Wright Medical Group, Inc., a Delaware corporation
formerly known as
Wright Acquisition Holdings, Inc. (the "Company"), and
<<Name>> (the
"Participant").
WITNESSETH:
WHEREAS, the Company desires to afford the Participant the
opportunity to
acquire ownership of the Company's common stock, par value $.01
per share
("Common Stock"), so that he may have a direct proprietary
interest in the
Company's success.
NOW, THEREFORE, in consideration of the covenants and agreements
herein
contained, the parties hereby agree as follows:
1. Grant of Options. Subject to the terms and conditions set
forth herein
and in the Company's Third Amended and Restated 1999 Equity
Incentive Plan, a
copy of which is attached hereto as Exhibit A (the "Plan"), on
the Effective
Date the Company does hereby grant to the Participant, during
the period
commencing on the Effective Date and ending on the 10th
anniversary of the
Effective Date (the "Expiration Date"), the right and option
(the right to
purchase any one share under this Agreement being an "Option")
to purchase from
the Company <<Shares>> shares of Common Stock. The
Option to purchase such
Common Stock shall have an exercise price of
$<<ExercisePrice>> per share. Each
of the Options granted pursuant to this Agreement shall, to the
fullest extent
permissible under Section 422 of the Code, constitute Incentive
Stock Options
under the Plan.
2. Limitations on Exercise of Options.
(a) Subject to the terms and conditions set forth herein and in
the
Plan, the Options shall vest and become exercisable, on a
cumulative basis, with
respect to 25% of the shares of Common Stock on the first
anniversary of the
Effective Date and on each succeeding anniversary thereafter so
long as the
Participant is employed by the Company; provided, however, that
upon the
occurrence of a Change in Control (as defined below), all of the
then unvested
Options shall automatically vest and be fully exercisable and
shall remain so
exercisable in accordance with the terms of this Agreement. The
Committee or the
Board may accelerate the vesting and exercisability of any or
all of the then
unvested Options at any time.
(b) For the purposes of this Agreement, the term "Change in
Control"
means the first to occur on or after the Effective Date of any
of the following:
(i) the acquisition by any person or persons acting as a
group
("Person") of capital stock of the Company which, when added to
any
capital stock of the Company already owned by the Person,
constitutes more than fifty percent (50%) of either (i) the
total
fair market value of the outstanding capital stock of the
Company,
or (ii) the total voting power of the outstanding capital stock
of
the
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Company; provided, however, that a Change in Control will not
be
deemed to have occurred when any Person who owns more than
fifty
percent (50%) of the total fair market value or the total
voting
power of the outstanding capital stock of the Company as of the
date
of this Agreement acquires any additional capital stock of
the
Company; and provided further, that an increase in the
percentage of
the outstanding capital stock of the Company owned by a Person
as a
result of a transaction in which the Company acquires its
capital
stock in exchange for property will be treated as an acquisition
of
such capital stock by such Person; or
(ii) the acquisition by a Person, in a single transaction or
a
series of transactions within a twelve (12) month period, of
capital
stock of the Company representing not less than thirty-five
percent
(35%) of the total voting power of the outstanding capital stock
of
the Company; or
(iii) the acquisition by a Person, in a single transaction or
a
series of transactions within a twelve (12) month period, of
consolidated assets of the Company which have a total gross
fair
market value of not less than forty percent (40%) of the total
gross
fair market value of all of the consolidated assets of the
Company
immediately prior to such acquisition(s), in each case
without
regard to any liabilities associated with such assets;
provided,
however, that a Change in Control will not be deemed to have
occurred when such assets are acquired by:
(1) an entity of which the Company owns, directly or
indirectly, fifty percent (50%) or more of the total fair
market
value or the total voting power of the outstanding capital
stock;
(2) a Person which owns, directly or indirectly, fifty
percent
(50%) or more of the total fair market value or the total
voting
power of the outstanding capital stock of the Company;
(3) an entity of which a Person described in clause (ii)
owns,
directly or indirectly, fifty percent (50%) or more of the
total
fair market value or the total voting power of the
outstanding
capital stock;
(4) an entity which is controlled by the stockholders of the
Company immediately after the transfer; or
(5) a stockholder of the Company in exchange for or with
respect to capital stock of the Company; or
(iv) a majority of the members of the Board is replaced in
any
twelve (12) month period by directors whose appointment or
election
is not endorsed by a majority of the members of the Board prior
to
the date of the appointment or election.
In making a determination as to whether a Change in Control has
occurred, the
foregoing definition shall be construed and applied in a manner
which would
avoid the imposition of
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federal income tax on the Participant by operation of Section
409A of the Code,
if applicable.
3. Non-Transferable. Except as specifically authorized by the
Committee,
the Participant may not transfer the Options except by will or
the laws of
descent and distribution and the Options shall be exercisable
during the
Participant's lifetime only by the Participant or, in the event
of his
incapacity, his guardian or legal representative. Except as so
authorized, no
purported assignment or transfer of the Options, or of the
rights represented
thereby, whether voluntary or involuntary, by operation of law
or otherwise
(except by will or the laws of descent and distribution), shall
vest in the
assignee or transferee any interest or right herein
whatsoever.
4. Termination of Employment.
(a) Disability; Retirement. If, prior to the Expiration Date,
the
Participant shall cease to be employed by the Company by reason
of a Disability
or retirement from the Company pursuant to any retirement plan
of the Company,
or the Participant's employment with the Company ceases for any
reason with the
written consent of the Committee, then the Options shall remain
exercisable
until the earlier of the Expiration Date or the date that is
thirty (30) days
after the date of such cessation of employment, but only to the
extent the
Options were vested and exercisable at the time of such
cessation of employment.
(b) Without Cause. If the Company terminates the
Participant's
employment without Cause, then upon such cessation of employment
all then
unvested Options shall automatically vest and be fully
exercisable and all then
unexercised Options shall be exercisable in accordance with the
terms of this
Agreement until the earlier of the Expiration Date or the date
that is three (3)
months after the date of such cessation of employment.
(c) Voluntary; For Cause. If the Participant voluntarily
terminates
employment with the Company for reasons other than Disability or
retirement
pursuant to any retirement plan of the Company and without the
consent of the
Committee or the Company terminates the Participant's employment
for Cause, then
all of the Options, to the extent not exercised prior to such
termination,
whether exercisable or not, shall lapse and be canceled
immediately upon such
cessation of employment.
(d) Death. If the Participant shall cease to be employed by
the
Company prior to the Expiration Date by reason of death, or if
the Participant
dies within the three (3) month period following a termination
of employment
with the Company while entitled to exercise any of the Options
pursuant to
Section 4(a) or 4(b), the executor or administrator of the
estate of the
Participant or the person or persons to whom the Options shall
have been validly
transferred by the executor or administrator pursuant to will or
the laws of
descent and distribution shall have the right, until the earlier
of the
Expiration Date or one (1) year after the date of death, to
exercise the
Options, but only to the extent that the Participant was
entitled to exercise
them on the date of death and subject to any other limitation
contained herein
on the exercise of the Options in effect on the date of
exercise.
(e) Whether employment has been or could have been terminated
for
the purposes of this Agreement, and the reasons therefor, shall
be determined by
the Committee,
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whose determination shall be final, binding and conclusive.
(f) Except as otherwise provided in this Section 4, Options
that
have not yet vested at the time of termination of the
Participant's employment
with the Company shall expire and no further vesting shall occur
with respect
thereto. After the expiration of any exercise period described
in this Section
4, the Options and all of the Participant's rights hereunder, to
the extent not
previously exercised, shall terminate.
5. Adjustments and Corporate Reorganizations. In accordance with
and
subject to the applicable terms of the Plan, the Options shall
be subject to
adjustment or substitution, as determined by the Committee, as
to the number,
price or kind of Stock or other consideration subject to such
Options or as
otherwise determined by the Committee to be equitable (i) in the
event of
changes in the outstanding Stock or in the capital structure of
the Company by
reason of stock dividends, stock splits, reverse stock
splits,
recapitalizations, reorganizations, mergers, consolidations,
combinations,
exchanges, or other relevant changes in capitalization occurring
after the date
hereof or (ii) in the
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