STOCK INCENTIVE AND NONCOMPETITION AGREEMENT
____________________ (state)
____________________ (county)
This agreement is made and entered into this ______
day of ________ (month), __ (year), by and between ___________________________,
Inc., a ______________ (state) corporation, designated herein as the Company,
and _____________________ designated herein as Employee. Both parties state and acknowledge as
follows:
A. The
Company is principally engaged in _____________________________; and
B. The
Company desires to provide incentive for future performance by Employee, and
Employee desires to provide services to the Company.
Now, therefore, in consideration of the premises and
the covenants set forth herein, it is agreed between the parties as follows:
1.
Performance: Employee, during
the continuance of his employment by the Company, shall use his best efforts in
the selection and supervision of personnel, the conception, organization,
execution and coordination of operating, merchandising and expansion programs,
and the application thereto of progressive techniques, controls, systems and
procedures, as required to improve sales, reduce expenses and otherwise
increase profitability and protect and enhance the image of the Company in
relation to its personnel and the public.
Employee, in the fulfillment of such responsibilities and the
performance of such duties, shall be accountable to and be subject to the
direction and control of the Company's Board of Directors. Employee shall devote as much of his time
and attention and energies and services as is reasonably needed for the
fulfillment of such responsibilities and performance of such duties, serve on
such committees to which the Company may appoint him from time to time,
exert his best efforts to improve the
business and condition of the Company, and not be or become employed or engaged
in any endeavor or business or business activity during continuance of his
employment except as provided in paragraph 3.
2. Stock
Bonus: Company shall provide Employee
with __________ (____) (# of shares) of the Company's outstanding stock. Employee shall be entitled to all voting
rights, rights to dividends and other rights of holders of Shares; however,
should Employee leave the employ of the Company (for any reason) before one
year from the date of this Agreement, ___________ percent of the shares distributed
under this Section 2 shall be forfeited.
If Employee leaves the employ of Company (for any reason) after one (1)
year from the date of this Agreement but before three (3) years from the date
of this Agreement, ___________ percent of the shares distributed to Employee
under this Section 2. shall be forfeited.
If Employee leaves the employ of the Company (for any reason) after
three (3) years from the date of this Agreement but before five (5) years from
the date of this Agreement, _____________ percent of the shares distributed to
Employee under this Section 2. shall be forfeited. If a forfeiture would result in the creation of fractional
share(s), the number of share(s) to be forfeited shall be rounded out to prevent
the creation of fractional share(s).
All stock distributed under this Agreement shall be adjusted to preserve
the value of the bonus in the event of a stock dividend, stock split or reverse
stock split, recapitalization, merger, consolidation, reorganization, cash or
property dividend, exchange of shares, repurchase of shares or any other change
in corporate structure of or by Company that in any such event materially
affects the outstanding shares of stock.
All stock distributed under this Agreement shall be subject to that
Shareholders Agreement, a copy of which is attached hereto as Exhibit A.
3.
Noncompetition: As partial
consideration for the issuance of shares to Employee described in Section 2.
above, Employee will not for a period of two (2) years from the effective date
of this Agreement, or for a period of one (1) year after Employees employment
with Company has been terminated by either party, whichever period is longer,
either directly or indirectly:
(a) Own,
have a proprietary interest of any kind in, or in any way enter into or attempt
to enter into the __________________________ business as it relates to
corporate formation or structuring:
(b) Induce
or attempt to persuade any former, current or future employee, agent, manager,
consultant, director, or other participant in Company's business to terminate
such employment or other relationship in order to enter into any relationship
with the Employee, any business organization in which the employee is a
participant in any capacity whatsoever, or any other business organization in
competition with Company's business; or
(c) Use
contracts, proprietary information, trade secrets, confidential information,
customer lists, mailing lists, goodwill, or other intangible property used or
useful in connection with the Company's business.
4. Stock
Option: Company shall provide employee
with an option to purchase ________ (___), but not less than ________ (___),
shares, for an aggregate purchase price of _____________ (amount)
($________). All stock purchased under
this Option shall be adjusted to preserve the value of the bonus in the event
of a stock dividend, stock split or reverse stock split, recapitalization,
merger, consolidation, reorganization, cash or property dividend, exchange of
shares, repurchase of shares or any other change in the corporate structure of
or by the Company that in any such event materially affects the outstanding
shares of stock. All stock purchased
under this Option shall be subject to the Shareholders Agreement attached
hereto and included herein as Exhibit A.
Said purchase price shall be payable at the closing of purchase in cash
or by certified check made payable to the Company. Such option may be exercised by giving the Company written notice
of Employees Exercise of such option prior to ____________ (date), If such option is not exercised by
____________ (date), such option shall terminate and be of no further force and
effect. The closing of such purchase
and sale shall be held at
__________________________ (company address) and
shall be held within ______ (___) days after Employee gives notice of his
intention to exercise the option.
IN WITNESS WHEREOF, the parties have executed this
Agreement under seal this the ______ day of __________ (month), ____ (year).
____________________________________ Inc. (Company
Name)
____________________________________ President’s
Signature
____________________________________ Employee’s
Signature
Attest:
_____________________________
Secretary
