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Stock Option Agreement -- Perform Enhncemnt PRTNRS

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EXECUTION COPY

NON-QUALIFIED STOCK OPTION AGREEMENT

AGREEMENT made as of January 28, 2008, by and between Frederick' s of Hollywood Group Inc. (formerly Movie Star, Inc.), a New York corporation (the " Company" ), and Performance Enhancement Partners, LLC (the " Consultant" ).

WHEREAS, effective on January 28, 2008 (the " Grant Date" ), pursuant to the terms and conditions of the Company' s 2000 Performance Equity Plan (the " Plan" ), the Board of Directors of the Company (the " Committee" ) authorized the grant to the Consultant of an option (the " Option" ) to purchase an aggregate of 137,500 post-split shares of the authorized but unissued Common Stock of the Company, $.01 par value (the " Common Stock" ), conditioned upon the Consultant' s acceptance thereof upon the terms and conditions set forth in this Agreement and subject to the terms of the Plan; and

WHEREAS, the Consultant desires to acquire the Option on the terms and conditions set forth in this Agreement.

IT IS AGREED:

1. Grant of Stock Option . The Company hereby grants the Consultant the Option to purchase all or any part of an aggregate of 137,500 post-split shares of Common Stock (the " Option Shares" ) on the terms and conditions set forth herein and subject to the provisions of the Plan.

2. Non-Qualified Stock Option . The Option represented hereby is not intended to be an Option which qualifies as an " Incentive Stock Option" under Section 422 of the Internal Revenue Code of 1986, as amended.

3. Exercise Price . The exercise price of the Option shall be $3.10 per share, subject to adjustment as hereinafter provided.

4. Exercisability . This Option is exercisable, subject to the terms and conditions of the Plan, as follows: the right to purchase 87,500 of the Option Shares shall be exercisable on and after the Grant Date, and the right to purchase 50,000 of the Option Shares shall be exercisable on and after


July 26, 2008. After a portion of the Option becomes exercisable, it shall remain exercisable except as otherwise provided herein, until the close of business on the day immediately preceding the fifth anniversary of the Grant Date (the " Exercise Period" ).

5. Effect of Termination of Engagement . Except as otherwise provided below, if the Consultant' s engagement with the Company terminates for any reason, the portion of the Option not yet exercisable on the date of termination of employment shall immediately expire. The portion of the Option which is exercisable on the date of termination of the Consultant' s engagement with the Company shall be exercisable by the Consultant at any time during the ninety (90) day period following the termination of the engagement; provided, however, that (i) if the Consultant' s engagement is terminated as a result of the " disability" (as defined in the Consulting Agreement, dated as of April 9, 2007, between the Company and Consultant (" Consulting Agreement" )) of Peter G. Cole (" Cole" ), then the Consultant' s right to exercise the Option shall terminate on the day preceding the first anniversary of the date of termination by reason of such disability; (ii) if the Consultant' s engagement with the Company is terminated because of Cole' s death (or if Cole' s death occurs within ninety (90) days after termination of the Consultant' s engagement for reasons other than those set forth in clause (i) above), then the Option shall be exercisable by the Consultant' s personal representative or heirs, as the case may be, within one year after the date of Cole' s death if and to the extent that it was exercisable at the date of the termination of the engagement; (iii) if Consultant' s engagement with the Company is terminated by the Company without " Cause" as defined in the Consulting Agreement or is terminated by Consultant for " Good Reason" as defined in the Consulting Agreement, then the portion of the Option which is exercisable on the date of termination and any additional portion of the Option which would have become exercisable if the engagement had continued shall become immediately exercisable and shall continue to be exercisable thereafter, absent the death of Cole (in which case the Option shall be exercisable by the Consultant' s personal representative or heirs, as the case may be, within one year after the date of Cole' s death), until the close of business on the day immediately preceding the fifth anniversary of the Grant Date; and (iv) if Consultant' s engagement with the Company is terminated for " Cause" as defined in the Consulting Agreement, then the portion of the Option that was exercisable on the date of termination shall also immediately expire.

6. Withholding Tax. Not later than the date as of which an amount first becomes includible in the gross income of the Consultant for Federal income tax purposes with respect to the


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Option, the Consultant shall pay to the Company, or make arrangements satisfactory to the Committee regarding the payment of, any Federal, state and local taxes of any kind required by law to be withheld or paid with respect to such amount (" Withholding Tax" ). The obligations of the Company under the Plan and pursuant to this Agreement shall be conditional upon such payment or arrangements with the Company and the Company shall, to the extent permitted by law, have the right to deduct any Withholding Taxes from any payment of any kind otherwise due to the Consultant from the Company.

7. Adjustments .

7.1 In the event of a stock split, stock dividend, combination of shares, or any other similar change in the Common Stock of the Company as a whole, the Board of Directors of the Company shall make equitable, proportionate adjustments in the number and kind of shares covered by the Option and in the option price hereunder.

7.2 In the event of any reclassification or reorganization of the outstanding shares of Common Stock other than a change covered by Section 7.1 or that solely affects the par value of such shares of Common Stock, or
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