Exhibit 10.1
MICHAELS STORES,
INC.
FORM OF STOCK OPTION
AGREEMENT
Optionee:
This Option and any securities
issued upon exercise of this Option are subject to restrictions on
voting and transfer and other provisions as set forth in the
Amended and Restated Stockholders Agreement among Michaels
Stores, Inc. and certain investors, originally dated as of
October 31, 2006, as amended and restated on February 16,
2007, and amended from time to time thereafter (the
“Stockholders Agreement”), and the terms of the
Registration Rights Agreement referred to therein (the
“Registration Rights Agreement”). This Option and
any securities issued upon exercise of this Option constitute an
Option and Shares, respectively, as defined in the Stockholders
Agreement.
This Stock Option Agreement (this
“Agreement”) is hereby entered into between Michaels
Stores, Inc., a Delaware corporation (the
“Company”), and the Optionee named above pursuant to
the Company’s 2006 Equity Incentive Plan, as amended from
time to time (the “Plan”). For the purpose of
this Agreement, the “Grant Date” shall mean
,
20 .
1.
Grant of
Option. This
Agreement evidences the grant by the Company on the Grant Date to
the Optionee of an option (the “Option”) to purchase,
in whole or in part, on the terms provided herein and in the Plan,
a total of
shares of Common Stock of the Company, par value $.10 per share
(the “Shares”), at the following prices per
Share:
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[ With respect to the following Shares in
which you are immediately vested (the “Vested
Option”) ]
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(a)
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[
Shares at $15.00 per Share, with an expiration date of
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20 ];
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(b)
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[
Shares at $15.00 per Share, with an expiration date of
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20 ];
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(c)
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[
Shares at $22.50 per Share, with an expiration date of
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20 ]; and
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(d)
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[
Shares at $22.50 per Share, with an expiration date of
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20 ].
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With respect to the following Shares subject to
vesting as set forth below (the “Unvested
Option”)
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(e)
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Shares at $7.50 per Share (the “Tranche 0
Option”);
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(f)
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Shares at $15.00 per Share (the “Tranche 1
Option”); and
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(g)
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Shares at $22.50 per Share (the “Tranche 2
Option”).
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The Option
evidenced by this Agreement is not intended to qualify as an
incentive stock
option under
Section 422 of the Internal Revenue Code (the
“Code”).
2.
Vesting . During the Optionee’s
Employment, the Unvested Option will vest and become exercisable
(i) with respect to 20% of the Shares subject to each of the
Tranche 0 Option, Tranche 1 Option and Tranche 2 Option on each of
the first through fifth anniversaries of the Grant Date or
(ii) if earlier, with respect to any unvested portion of the
Unvested Option, upon a Change of Control (as defined in the
Stockholders Agreement).
3.
Exercise of Option
.
(a)
Details of
Exercise . Each election to
exercise this Option shall be subject to the terms and conditions
of the Plan and shall be in writing, signed by the Optionee or by
his or her executor or administrator or by the Person or Persons to
whom this Option is transferred by will or the applicable laws of
descent and distribution (the “Legal Representative”),
and made pursuant to and in accordance with the terms and
conditions set forth in the Plan. The latest date on which
this Option may be exercised [(i) with respect to the Vested
Option is set forth in Section 1 above, and (ii)] with respect
to the Unvested Option is
,
20 , subject to earlier termination in
accordance with the terms and provisions of the Plan and this
Agreement.
(b)
Payment of
Exercise Price . The following are
permitted forms of payment for the exercise of this Option and for
the remittance of withholding taxes pursuant to Section 8:
(a) cash or check acceptable to the Administrator,
(b) actual or constructive transfer to the Company of shares
of Stock owned by the Optionee for at least six months (or, with
the consent of the Administrator, for less than six months) having
an aggregate Fair Market Value at the date of exercise equal to the
aggregate exercise price of the Award, (c) authorization by
the Optionee of the Company to withhold a number of shares of Stock
otherwise issuable to the Optionee under this Option having an
aggregate Fair Market Value on the date of exercise equal to the
aggregate exercise price of this Option and, if applicable, the
amount of any withholding tax, (d) at such time, if any, as
the Stock is publicly traded through a broker-assisted
“cashless” exercise program acceptable to the
Administrator, and (e) by a combination of such methods of
payment.
4.
Effect of Certain
Transactions . In the event of a Corporate
Transaction (as defined in the Plan) or a Change of
Control
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