WRIGHT MEDICAL GROUP, INC.
Stock Option Grant Agreement
Non-US Employee
Award Granted
to (“Grantee”):
Grant Date:
Number of Shares (“Shares”):
Option Price:
THIS
STOCK OPTION GRANT AGREEMENT (the “Agreement”)
including any country-specific appendix hereto, is made as of the
Grant Date by and between Wright Medical Group, Inc., a Delaware
corporation with its principal place of business at 5677 Airline
Road, Arlington, Tennessee 38002 (the “Company”) and
Grantee pursuant to the Wright Medical Group, Inc. 2009 Equity
Incentive Plan, as amended from time to time (the
“Plan”) and which is hereby incorporated by
reference.
WHEREAS,
Grantee is associated with the Company or its affiliate as an
employee; and
WHEREAS,
the Compensation Committee of the Company’s Board of
Directors (the “Committee”) has authorized that Grantee
be granted the right and option to purchase from the Company the
Shares of the Company’s Common Stock (“Stock”)
subject to the terms and restrictions stated below;
NOW,
THEREFORE, the parties agree as follows:
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1.
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Grant of Options
. Subject to the terms
and conditions of this Agreement and of the Plan, the Company
hereby grants to Grantee the right and option (the right to
purchase any one share of Stock under this Agreement being an
“Option”) during the period commencing on the Grant
Date and ending on the 10th anniversary of the Grant Date (the
“Expiration Date”) to purchase from the Company the
Shares. Each Option shall have an exercise price per share equal to
the Option Price indicated above.
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2.
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Vesting Schedule
. The Options shall vest
as to one-fourth (1/4) of the Shares on the first anniversary of
the Grant Date, and as to an additional one-fourth (1/4) on each
succeeding anniversary date, so as to be 100% vested on the fourth
anniversary of the Grant Date, conditioned upon Grantee maintaining
status as an Eligible Person (as defined in the Plan) as of each
vesting date. Notwithstanding the foregoing, the interest of
Grantee to the Options shall vest as to:
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2.1.
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100% of the then unvested Options
upon a Change of Control. For purposes of this Agreement, a
“Change of Control” shall mean the first to occur on or
after the Grant Date of any of the following:
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(a) The
acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) (a
“Person”) of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of 50% or
more (on a fully diluted basis) of either (A) the then
outstanding shares of Stock, taking into account as outstanding for
this purpose such Stock issuable upon the exercise of options or
warrants, the conversion of convertible stock or debt, and the
exercise of any similar right to acquire such Stock (the
“Outstanding Company Common Stock”) or (B) the
combined voting power of the then outstanding voting securities of
the Company entitled to vote generally in the election of directors
(the “Outstanding Company Voting Securities”);
provided, however, that for purposes of this subsection (a), the
following acquisitions shall not constitute a Change of Control:
(x) any acquisition by the Company or any
“affiliate” of the Company, within the meaning of 17
C.F.R. § 230.405 (an “Affiliate”), (y) any
acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any Affiliate,
(z) any acquisition by any corporation or business entity
pursuant to a transaction which complies with clauses (A) and
(B) of
Stock Option
Grant Agreement
Page 2
subsection
(a) of this Section 2.1 (persons and entities described in
clauses (x), (y), and (z) being referred to herein as
“Permitted Holders”);
(b) The
consummation of a reorganization, merger or consolidation or sale
or other disposition of all or substantially all of the assets of
the Company (a “Business Combination”), in each case,
unless, following such Business Combination, (A) all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or
indirectly, more than 60% of, respectively, the then outstanding
shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without
limitation, a corporation which as a result of such transaction
owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately
prior to such Business Combination, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case
may be, (B) no Person (excluding any Permitted Holder)
beneficially owns, directly or indirectly, 50% or more (on a fully
diluted basis) of, respectively, the then outstanding shares of
common stock of the corporation resulting from such Business
Combination, taking into account as outstanding for this purpose
such common stock issuable upon the exercise of options or
warrants, the conversion of convertible stock or debt, and the
exercise of any similar right to acquire such common stock, or the
combined voting power of the then outstanding voting securities of
such corporation except to the extent that such ownership existed
prior to the Business Combination, and (C) at least a majority
of the members of the board of directors of the corporation
resulting from such Business Combination were members of the
incumbent Board at the time of the execution of the initial
agreement providing for such Business Combination;
(c) The
approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company;
(d) The
sale of at least 80% of the assets of the Company to an unrelated
party, or completion of a transaction having a similar effect;
or
(e) The
individuals who on the date of this Agreement constitute the Board
of Directors thereafter cease to constitute at least a majority
thereof; provided that any person becoming a member of the Board of
Directors subsequent to the date of this Agreement and whose
election or nomination was approved by a vote of at least
two-thirds of the directors who then comprised the Board of
Directors immediately prior to such vote shall be considered a
member of the Board of Directors on the date of this
Agreement.
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3.1.
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Except as specifically authorized by
the Committee, Grantee may not transfer the Options except by will
or the laws of descent and distribution and the Options shall be
exercisable during the Grantee’s lifetime only by the Grantee
or, in the event of Grantee’s incapacity, Grantee’s
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.
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3.2.
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By
accepting the Options, Grantee represents and agrees for Grantee
and Grantee’s transferees (whether by will or the laws of
descent and distribution) that:
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Stock Option
Grant Agreement
Page 3
(a) For
the period commencing on the Grant Date and ending on the first
anniversary of the date upon which Grantee loses status as an
Eligible Person (such date is hereinafter referred to as the
“Covenant Period”), with respect to any Country in
which the Company is engaged in business during Grantee’s
employment with the Company, Grantee shall not participate or
engage, directly or indirectly, for Grantee or on behalf of or in
conjunction with any person, partnership, corporation or other
entity, whether as an employee, agent, officer, director,
stockholder, partner, joint venturer, investor or otherwise, in any
business activities if such activity consists of any activity
undertaken or expressly planned to be undertaken by the Company or
any of its subsidiaries or by Grantee at any time during which
Grantee maintained status as an Eligible Person.
(b) Except
with the Company’s prior written approval or as may otherwise
be required by law or legal process, Grantee shall not disclose any
material or information which is confidential to the Company or its
subsidiaries and not in the public domain or generally known in the
industry, whether tangible or intangible, made available, disclosed
or otherwise known to Grantee as a result of Grantee’s status
as an Eligible Person.
(c) During
the Covenant Period, Grantee shall not attempt to influence,
persuade or induce, or assist any other person in so persuading or
inducing, any employee of the Company or its subsidiaries to give
up, or to not commence, employment or a business relationship with
the Company.
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3.3.
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The
Company shall have the right, but not the obligation, to purchase
and acquire from Grantee any or all of the Shares previously
acquired by Grantee upon exercise of an Option (the
“Repurchased Shares”) if the Committee reasonably
determines that Grantee has violated the covenants set forth in
this Agreement or Grantee’s loss of status as an Eligible
Person is a result of termination of employment for Cause (as
defined in the Plan) or Grantee’s loss of status as an
Eligible Person could have resulted from termination of employment
for Cause. The Company may exercise the right granted to it under
this Section 3.3 by delivering written notice to Grantee
stating that the Company is exercising the repurchase right granted
to it under this Section 3.3. The delivery of such notice by
the Company to Grantee shall constitute a binding commitment of the
Company to purchase and acquire all of the Repurchased Shares. The
total purchase price for the Repurchased Shares shall be delivered
to the Grantee against delivery by Grantee of certificates
evidencing the Repurchased Shares no later than 30 days after
the delivery of the election notice by the Company. The price per
share of the Repurchased Shares shall be the lesser of 1) the Fair
Market Value (as defined in the Plan) of each of the Repurchased
Shares on the date of the Company’s delivery of its written
notice to Grantee or 2) the Option Price.
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3.4.
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The
Company shall have the right, and not the obligation, to cancel any
or all of the Options if the Committee reasonably determines that
Grantee has violated the covenants set forth in this Agreement. The
Company may exercise the right granted to it under this
Section 3.4 by delivering a written notice to Grantee stating
that the Company is exercising the cancellation right granted to it
under this Section 3.4.
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3.5.
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Notwithstanding anything in this
Section 3 to the contrary, the Company shall not be obligated
to purchase any Stock at any time to the extent that the purchase
would result in a violation of any law, statute, rule, regulation,
order, writ, injunction, decree or judgment promulgated or entered
by any Federal, state, local or foreign court or governmental
authority applicable to the Company or any of its
property.
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Stock Option
Grant Agreement
Page 4
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3.6.
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The
parties intend the restrictions in Sections 3.2, 3.3, and 3.4
to be completely severable and independent, and any invalidity or
unenforceability of any one or more such restrictions shall not
render invalid or unenforceable any one or more
restrictions.
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4.
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Exercise; Payment for and Delivery
of Shares .
Options which have become exercisable may be exercised by delivery
of written notice of exercise to the Committee accompanied by
payment of the Option Price. The Option Price shall be payable in
cash and/or shares of Stock value at the Fair Market Value (as
defined in the Plan) on the date the Option is exercised or, in the
discretion of the Committee, either (i) in other property
having a fair market value on the date of exercise equal to the
Option Price, or (ii) by delivering to the Committee a copy of
irrevocable instructions to a stockbroker to deliver promptly to
the Company an amount of sale or loan proceeds sufficient to pay
the Option Price.
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5.
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Loss of Status as an Eligible
Person. If
prior to the Expiration Date Grantee ceases to be an Eligible
Person, the Options shall expire on the earlier of the Expiration
Date or the date that is ninety days after the date upon which
Grantee ceased to be an Eligible Person. In such event, the Options
shall remain exercisable by Grantee until expiration only to the
extent the Options were exercisable at the time that Grantee ceased
to be an Eligible Person.
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6.
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Stockholder Rights
. Grantee or a
transferee of the Options shall have no rights as a stockholder
with respect to any Shares covered by the Options until Grantee
shall have become the holder of record of such shares (and the
Company shall use its reasonable best efforts to cause Grantee to
become the holder of record of such shares), and, except as
provided in Section 7 of this Agreement, no adjustment shall
be made for dividends or distributions or other rights in respect
of such Shares for which the record date is prior to the date upon
which he or she shall become the holder of record
thereof.
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7.
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Changes in Capital
Structure .
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 event of any change in applicable laws or any
change in circumstances which results in or would result in any
substantial dilution or enlargement of the rights granted to, or
available for, Grantee. No such adjustment shall be made which
would result in an increase in the amount of gain or a decrease in
the amount of loss inherent in the Options. The Company shall give
Grantee written notice of an adjustment hereunder. Notwithstanding
anything herein to the contrary, in the event of any of the
following:
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(a) The
Company is merged or consolidated with another corporation or
entity and, in connection therewith, consideration is received by
stockholders of the Company in a form other than stock or other
equity interests of the surviving entity;
(b) All or
substantially all of the assets of the Company are acquired by
another person; or
(c) The
Company’s reorganization or liquidation;
then the
Committee may, in its discretion and upon at least ten days advance
notice to the affected persons, cancel any outstanding Options and
pay to Grantee, in cash, the value of such Options based upon the
price per share of Stock received or to be received by other
stockholders of the Company in
Stock Option
Grant Agreement
Page 5
such event and
the per share exercise price of the Options.
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8.1.
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By
accepting the Options, Grantee represents and agrees for Grantee
and any transferees (whether by will or the laws of descent and
distribution) that, unless a registration statement under the
Securities Act is in effect as to the shares purchased upon any
exercise of the Options, (i) any and all Shares so purchased
shall be acquired for his or her personal account and not with a
view to or for sale in connection with any distribution, and
(ii) each notice of the exercise of any portion of this Option
shall be accompanied by a representation and warranty in writing,
signed by the person entitled to exercise the same, that the shares
are being so acquired in good faith for his or her personal account
and not with a view to or for sale in connection with any
distribution.
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8.2.
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No
certificate or certificates for Shares may be purchased, issued or
transferred if the exercise hereof or the issuance or transfer of
such Shares shall constitute a violation by the Company or Grantee
of any (i) provision of any Federal, state or other securities
law, (ii) requirement of any securities exchange listing
agreement to which the Company may be a party, or (iii) other
requirement of law or of any regulatory body having jurisdiction
over the Company. Any reasonable determination in this connection
by the Company, upon notice given to Grantee, shall be final,
binding and conclusive.
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8.3.
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The
certificates representing shares of Common Stock acquired pursuant
to the exercise of Options shall carry such appropriate legend, and
such written instructions shall be given to the Company’s
transfer agent, as may be deemed necessary or advisable by counsel
to the Company in order to comply with the requirements of the
Securities Act or any state securities laws.
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9.
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Taxes . Regardless of any action the
Company or Grantee’s employer (the “Employer”)
takes with respect to any or all income tax, social insurance,
payroll tax, payment on account or other tax-related items related
to Grantee’s participation in the Plan and legally applicable
to Grantee or deemed by the Company or the Employer to be an
appropriate charge to Grantee even if technically due by the
Company or the Employer (“Tax-Related Items”), Grantee
acknowledges that the
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