As filed with the Securities and Exchange Commission on December 2, 1999
Registration No. 333-_______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
KENNEDY-WILSON, INC.
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C> <C>
9601 Wilshire Boulevard
Delaware Suite 220 95-4364537
(State or Other Jurisdiction Beverly Hills, California 90210-5205 (I.R.S. Employer
of Incorporation or (Address and Zip Code of Principal Executive Identification No.)
Organization) Offices)
</TABLE>
Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option Plan
Kennedy-Wilson, Inc. 1992 Non-Employee Director Stock Option Plan
(Full Title of the Plans)
<TABLE>
<S> <C>
Freeman Lyle With copy to: Richard K. Smith, Jr., Esq.
Chief Financial Officer White & Case LLP
9601 Wilshire Boulevard, Suite 220 633 West Fifth Street, Suite 1900
Beverly Hills, California 90210-5205 Los Angeles California 90071-2007
(310) 887-6400 (213) 620-7700
(Name, Address, Including Zip Code, and
Telephone Number, Including Area Code, of
Agent for Service)
</TABLE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
Proposed Maximum Proposed Maximum
Title Of Securities Amount To Be Offering Price Per Aggregate Offering Amount Of
To Be Registered Registered (1) Share (2) Price (2) Registration Fee
------------------- -------------- ------------------ ------------------ ----------------
Common Stock, par
value $.01 per share 944,000 (3) $7.66 $7,231,040 $1,908.99
Common Stock, par
value $.01 per share 81,000 (4) $7.66 $ 620,460 $ 163.80
</TABLE>
(1) Pursuant to Rule 416, the number of shares of Common Stock being registered
shall be adjusted to include any additional shares which may become
issuable as a result of stock splits, stock dividends or similar
transactions in accordance with the anti-dilution provisions of the
Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option Plan and
the Kennedy-Wilson, Inc. 1992 Non-Employee Director Stock Option Plan.
(2) Estimated solely for calculating the amount of the registration fee
pursuant to Rule 457(h). The price and fee are computed based upon the
average of the high and low sales prices of the Common Stock as reported on
the Nasdaq National Market on November 30, 1999.
(3) Shares underlying options subject to grant under the Kennedy-Wilson, Inc.
1992 Incentive and Nonstatutory Stock Option Plan.
(4) Shares underlying options subject to grant under the Kennedy-Wilson, Inc.
1992 Non-Employee Director Stock Option Plan.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The information specified in this Part is not required to be filed with the
Securities and Exchange Commission as part of this Registration Statement
pursuant to the Note to Part 1 of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange Commission
by Kennedy-Wilson, Inc. (the "Registrant") are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1998, as amended to the date hereof;
(b) The Registrant's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1999, June 30, 1999 and September 30, 1999, as amended to
the date hereof;
(c) The Registrant's Current Report on Form 8-K dated March 15, 1999;
and
(d) The description of Common Stock, par value $0.01 per share,
contained in the Registrant's Registration Statement on Form S-1 filed on
April 22, 1999.
In addition to the foregoing documents, all documents subsequently filed by
the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have
been sold or which de-registers all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part hereof from the
date of the filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article XII of the Registrant's Certificate of Incorporation provides that
the Registrant shall, to the fullest extent permitted by the Delaware General
Corporation Law, as amended from time to time ("Delaware Law"), indemnify each
present and former director and officer of the Registrant, and the estates of
each such person, and each person who is or was serving at the request of the
Registrant as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise, including for certain liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). Section 145 of the
Delaware Law authorizes a corporation to indemnify such directors and officers
in terms sufficiently broad to permit such indemnification (including
reimbursement of expenses incurred) under certain circumstances for liabilities
under the Securities Act.
Section 145 of the Delaware Law provides that in the case of any action
other than one by or in the right of the corporation, a corporation may
indemnify any person who was or is a party, or is threatened to be made a party
to any action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that such person is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation in such capacity on behalf of another corporation or
enterprise, against expenses (including attorney's fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action if he acted in good faith and in a manner he reasonably
believed to be in, or not opposed to, the best interest of the corporation and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful.
Section 145 of the Delaware Law provides that in the case of an action by
or in the right of a corporation to procure a judgment in its favor, a
corporation may indemnify any person who was or is a party, or is threatened to
be made a party to any action or suit by reason of the fact that such person is
or was a director, officer, employee or agent of the corporation, or is was
serving at the request of the corporation in such capacity on behalf of another
corporation or enterprise, against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense or settlement of
such action or suit if he acted under standards similar to those set forth in
the preceding paragraph, except that no indemnification may be made in respect
of any action or claim as to which such person shall have been adjudged to be
liable to the corporation, unless a court determines that such person is fairly
and reasonably entitled to indemnification.
Section 7.1 of Article VII of the Registrant's Bylaws and Article XII of
the Registrant's Certificate of Incorporation provide that the Registrant shall
indemnify, in the manner and to the fullest extent permitted by Delaware law
(including Section 145 of the Delaware Law), present and former directors and
officers of the Registrant, and the estates of each such person, and each person
who is or was serving at the request of the Registrant as a director or officer
of another corporation, partnership, joint venture, trust or other enterprise,
in proceedings by or in the right of the Registrant or otherwise. Section 7.1 of
Article VII of the Registrant's Bylaws and Article XII of the Registrant's
Certificate of Incorporation also permit the Registrant to indemnify to the
fullest extent authorized by Delaware law (including Section 145 of the Delaware
Law) present or former employees and agents of the registrant, and each person
who is or was serving at the request of the Registrant as an employee or agent
of another corporation, partnership, joint venture, trust or other enterprise,
in proceedings by or in the right of the Registrant or otherwise against losses
incurred by any such person by reason of the fact that such person was acting in
such capacity.
In addition, Article XII of the Registrant's Certificate of Incorporation
and Section 102(7) of the Delaware Law provide that a director of the Registrant
shall not be liable to the Registrant or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability (i) for any
breach of the director's duty of loyalty to the Registrant or its stockholders,
(ii) for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law, (iii) in respect of certain unlawful
dividend payments or stock redemptions or repurchases, and (iv) for any
transaction from which the director derives an improper personal benefit. The
effect of this provision of the Registrant's Certificate of Incorporation is to
eliminate the rights of the Registrant and its stockholders (through
stockholders' derivative suits on behalf of the Registrant) to recover monetary
damages against a director for breach of the fiduciary duty of care as a
director (including breaches resulting from negligent or grossly negligent
behavior) except in the situations described in clauses (i) through (iv) above.
This provision does not limit or eliminate the rights of the Registrant or any
stockholder to seek non-monetary relief such as an injunction or rescission in
the event of a breach of a director's duty of care.
As permitted by Article XII of the Registrant's Certificate of
Incorporation, the Registrant currently maintains directors' and officers'
liability insurance. The policy insures directors and officers for liabilities
incurred in connection with or on behalf of the Registrant, except for losses
incurred on account of certain specified liabilities, including losses from
matters which may be deemed uninsurable under the law pursuant to which this
policy shall be construed.
Prior to incorporating in Delaware in 1992, the predecessor company of the
Registrant operated as a California S corporation. At the time of the
termination of such predecessor company's S corporation status in 1992, the
Registrant agreed to indemnify its former shareholders for certain federal and
state tax liabilities incurred by them as a result of a final determination of
an adjustment to the tax returns of the predecessor company or former
shareholders for the 1992 tax year.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
4.1 Certificate of Incorporation of the Registrant, as amended to date
(The Certificate of Incorporation, as amended through December 31,
1998, was filed as Exhibit 3.1 to the Registrant's 1998 Annual Report
on Form 10-K. The April 1999 Amendment to the Registrant's Certificate
of Incorporation was filed as Exhibit 3.1.2 to the Registrant's 1999
Registration Statement on Form S-1 (Registration No. 333-74391). Both
are incorporated herein by this reference).
4.2 By-Laws of the Registrant (Filed as Exhibit 3.2 to the Registrant's
1992 Registration Statement on Form S-1 (Registration No. 33-46978)
and incorporated herein by this reference).
4.3 Form of Stock Certificate (Filed as Exhibit 4.1 to the Registrant's
1992 Registration Statement on Form S-1 (Registration No. 33-46978)
and incorporated herein by this reference).
5.1 Opinion and consent of White & Case LLP.
23.1 Consent of Deloitte & Touche LLP.
24.1 Power of Attorney (Included on the signature page hereto).
99.1 Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option
Plan.
99.2 Amendment Number One to Kennedy-Wilson, Inc. 1992 Incentive and
Nonstatutory Stock Option Plan.
99.3 Amendment Number Two to Kennedy-Wilson, Inc. 1992 Incentive and
Nonstatutory Stock Option Plan.
99.4 Amendment Number Three to Kennedy-Wilson, Inc. 1992 Incentive and
Nonstatutory Stock Option Plan.
99.5 Kennedy-Wilson, Inc. 1992 Non-Employee Director Stock Option Plan.
99.6 Form of Stock Option Agreement for Kennedy-Wilson, Inc. 1992 Incentive
and Nonstatutory Stock Option Plan.
99.7 Form of Stock Option Agreement for Kennedy-Wilson, Inc. 1992
Non-Employee Director Stock Option Plan.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement;
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement;
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if this Registration Statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Beverly Hills, State of California on this 10th day
of November, 1999.
KENNEDY-WILSON, INC.
By:/s/ William J. McMorrow
---------------------------------------
William J. McMorrow
Chairman of the Board of Directors and
Chief Executive Officer
(Principal Executive Officer)
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below does hereby constitute and appoint William J. McMorrow and Freeman
A. Lyle with full power of substitution and full power to act without the other,
his true and lawful attorney-in-fact and agent to act for him in his name, place
and stead, in any and all capacities, to sign any or all amendments (including
post-effective amendments) to this Registration Statement on Form S-8, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises in order to effectuate the same as fully, to all intents
and purposes, as they or he might or could to in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ William J. McMorrow
- ----------------------------- Chairman of the Board of November 10, 1999
William J. McMorrow Directors and Chief Executive Officer
(Principal Executive Officer)
/s/ Freeman A. Lyle
- ----------------------------- Executive Vice President, Chief November 10, 1999
Freeman A. Lyle Financial Officer and Secretary
(Principal Financial
and Accounting Officer)
/s/ Lewis A. Halpert
- ----------------------------- Executive Managing Director November 10, 1999
Lewis A. Halpert and Director
- ----------------------------- Managing Director and Director November , 1999
Richard A. Mandel
/s/ Barry s. Schlesinger
- ----------------------------- Director November 10, 1999
Barry S. Schlesinger
/s/ Donald B. Prell
- ----------------------------- Director November 10, 1999
Donald B. Prell
- ----------------------------- Director November , 1999
Kent Y. Mouton
- ----------------------------- Director November , 1999
Thomas J. Barrack, Jr.
</TABLE>
<PAGE>
INDEX TO EXHIBITS
Exhibit Description
4.1 Certificate of Incorporation of the Registrant, as amended to date
(The Certificate of Incorporation, as amended through December 31,
1998, was filed as Exhibit 3.1 to the Registrant's 1998 Annual Report
on Form 10-K. The April 1999 Amendment to the Registrant's Certificate
of Incorporation was filed as Exhibit 3.1.2 to the Registrant's 1999
Registration Statement on Form S-1 (Registration No. 333-74391). Both
are incorporated herein by this reference).
4.2 By-Laws of the Registrant (Filed as Exhibit 3.2 to the Registrant's
1992 Registration Statement on Form S-1 (Registration No. 33-46978)
and incorporated herein by this reference).
4.3 Form of Stock Certificate (Filed as Exhibit 4.1 to the Registrant's
1992 Registration Statement on Form S-1 (Registration No. 33-46978)
and incorporated herein by this reference).
5.1 Opinion and consent of White & Case LLP.
23.1 Consent of Deloitte & Touche LLP.
24.1 Power of Attorney (Included on the signature page hereto).
99.1 Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option
Plan.
99.2 Amendment Number One to Kennedy-Wilson, Inc. 1992 Incentive and
Nonstatutory Stock Option Plan.
99.3 Amendment Number Two to Kennedy-Wilson, Inc. 1992 Incentive and
Nonstatutory Stock Option Plan.
99.4 Amendment Number Three to Kennedy-Wilson, Inc. 1992 Incentive and
Nonstatutory Stock Option Plan.
99.5 Kennedy-Wilson, Inc. 1992 Non-Employee Director Stock Option Plan.
99.6 Form of Stock Option Agreement for Kennedy-Wilson, Inc. 1992 Incentive
and Nonstatutory Stock Option Plan.
99.7 Form of Stock Option Agreement for Kennedy-Wilson, Inc. 1992
Non-Employee Director Stock Option Plan.
[LETTERHEAD OF WHITE & CASE LLP]
December 2, 1999
Kennedy-Wilson, Inc.
9601 Wilshire Boulevard
Suite 220
Beverly Hills, California 90210
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as special counsel to Kennedy-Wilson, Inc., a Delaware
corporation (the "Company"), and are familiar with the proceedings and documents
relating to the proposed registration by the Company, through a Registration
Statement on Form S-8 (the "Registration Statement"), to be filed by the Company
with the Securities and Exchange Commission, of up to 944,000 of the Company's
common shares, $.01 par value ("Common Shares"), subject to grant under the
Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option Plan (the
"INSOP"), and up to 81,000 Common Shares subject to grant under the
Kennedy-Wilson, Inc. 1992 Non-Employee Director Stock Option Plan (the "NDSOP,"
and collectively with the INSOP, the "Plans"). Collectively, the shares being
registered pursuant to the Registration Statement are referred to herein as the
"Shares."
For the purposes of rendering this opinion, we have examined originals or
photostatic copies of:
(1) The INSOP;
(2) The NDSOP; and
(3) Copies of such corporate records, agreements and other documents
of the Company as we have deemed relevant and necessary as a basis for the
opinion hereinafter set forth.
In connection with our examination of such documents, we have assumed the
genuineness of all signatures on, and the authenticity of, all documents
submitted to us as originals and the conformity to the original documents of all
documents submitted to us as copies. With respect to instruments executed by
natural persons, we have assumed the legal competency and authority of such
persons. As to facts material to the opinion expressed herein which were not
independently established or verified, we have relied upon oral or written
statements and representations of the Company. We express no opinion herein as
to any laws other than the General Corporation Law of the State of Delaware.
Based on the foregoing, in reliance thereon and subject to compliance with
applicable state securities laws and the assumptions and qualifications set
forth herein, we are of the opinion that the Shares, when issued and delivered
in accordance with the terms and conditions set forth in the Plans and any
related documents, will be validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement, and we further consent to the use of our name under the heading
"Legal Matters" in the Prospectus which is a part of the Registration Statement.
Very truly yours,
/s/ White & Case LLP
RKS:JD
DELOITTE & TOUCHE
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement
of Kennedy Wilson, Inc. on Form S-8 of our report dated February 26, 1999
appearing in the Annual Report on Form 10-K/A of Kennedy Wilson, Inc. for the
year ended December 31, 1998.
/s/ DELOITTE & TOUCHE LLP
November 17, 1999
KENNEDY-WILSON, INC.
1992 INCENTIVE AND NONSTATUTORY STOCK OPTION PLAN
1. NAME, EFFECTIVE DATE AND PURPOSE.
(a) This Plan document is intended to implement and govern two separate
stock option plans of KENNEDY-WILSON, INC., a Delaware corporation (the
"Company"): the Incentive Stock Option Plan ("Plan A") and the Nonstatutory
Stock Option Plan ("Plan B") . Plan A provides for the granting of options that
are intended to qualify as incentive stock options ("Incentive Stock Options")
within the meaning of Section 422 (b) of the Internal Revenue Code of 1986, as
amended (the "Code"). Plan B provides for the granting of options that are not
intended to so qualify. Unless specified otherwise, all the provisions of this
Plan relate equally to both Plan A and Plan B and are condensed for convenience
into one Plan document.
(b) Plan A and Plan B are each established effective as of May 11, 1992.
The purpose of Plan A and Plan B (sometimes together referred to as the "Plan"
or this "Plan") is to promote the growth and general prosperity of the Company
and its Affiliated Companies. This Plan will permit the Company to grant options
("Options") to purchase shares of its common stock ("Common Stock"). The
granting of Options will help the Company attract and retain the best available
persons for positions of substantial responsibility and will provide certain key
employees with an additional incentive to contribute to the success of the
Company and its Affiliated Companies. For purposes of this Plan, the term
"Affiliated Companies" shall mean any component member of a controlled group of
corporations, as defined under Code Section 1563, in which the Company is also a
component member.
2. ADMINISTRATION.
(a) The Plan shall be administered by a Committee of the Board of Directors
of the Company (the "Committee") appointed by the Board of Directors of the
Company (the "Board").
(b) The Committee shall have sole authority in its absolute discretion, to
determine which of the eligible persons of the Company and its Affiliated
Companies shall receive Options ("Optionees"), and, subject to the express
provisions and restrictions of this Plan, shall have sole authority, in its
absolute discretion, to determine the time when Options shall be granted, the
terms and conditions of an Option other than those terms and conditions fixed
under this Plan, the number of shares which may be issued upon exercise of an
Option and the means of payment for such shares, and shall have authority to do
everything necessary or appropriate to administer the Plan. All decisions,
determinations and interpretations of the Committee shall be final and binding
on all Optionees.
(c) The Committee appointed by the Board shall consist of not less than two
(2) members of the Board, all of whom shall be directors who are not employees
of the company ("Outside Directors") and each of whom shall be a "disinterested
person" (as such term is defined in Rule 16b-3 promulgated under the Securities
Exchange Act of 1934, as amended, as such rule may be amended from time to
time). The Board may from time to time remove members from, or add members to,
the Committee (provided such members added are Outside Directors), and vacancies
on the Committee shall be filled by the Board. Any Outside Director may be
eligible to become a member of the Committee provided such person has not
received a discretionary grant or award under any Company stock plan during the
twelve-month period preceding the transaction that constituted such person's
initial action as a member of the Committee.
(d) Definitions:
(i) Restricted Shareholder: An individual who, at the time an Option
is granted under either Plan A or Plan B, owns stock possessing more than
10% of the total combined voting power of all classes of stock of the
employer corporation or of its Parent Corporation or Subsidiary
Corporation, with stock ownership to be determined in light of the
attribution rules set forth in Section 424(d) of the Code.
(ii) Parent Corporation: A corporation as defined in Section 424(e) of
the Code.
(iii) Subsidiary Corporation: A corporation as defined in section
424(f) of the Code.
(iv) Officer: The president, secretary, chief financial officer, any
managing director, any vice president in charge of a principal business
function (such as sales, administration, or finance) and any other person
who performs similar policy-making functions for the Company.
3. ELIGIBILITY.
(a) Plan A: The Committee may, in its discretion, grant one or more Options
under Plan A to any key management employee of the Company or its Affiliated
Companies, including any employee who is a director of the Company or of any of
its Affiliated Companies presently existing or hereinafter organized or
acquired. Such Options may be granted to one or more such employees without
being granted to other eligible employees, as the Committee may deem fit.
(b) Plan B: The Committee may, in its discretion, grant one or more Options
under Plan B to any key management employee, any employee who is a director of
the Company or its Affiliated Companies presently existing or hereinafter
organized or acquired or any person who performs consulting or other services
for the Company or its Affiliated Companies and who is designated by the Board
as eligible to participate in Plan B. Such Options may be granted to one or more
such persons without being granted to other eligible persons, as the Board may
deem fit.
(c) Notwithstanding anything to the contrary herein said, Outside Directors
shall not be eligible to receive a grant of Options under this Plan.
4. STOCK TO BE OPTIONED.
(a) The maximum aggregate number of shares which may be optioned and sold
under Plan A and Plan B is 750,000 shares of authorized Common Stock of the
Company. The foregoing constitutes an absolute cumulative limitation on the
total number of shares that may be optioned under both Plan A and B. Therefore,
at any particular date the maximum aggregate number of shares which may be
optioned under Plan A is equal to 750,000 minus the number of shares previously
optioned under both Plan A and Plan B and the maximum aggregate number of shares
which may be optioned under Plan B is equal to 750,000 minus the number of
shares which have been previously optioned under both Plan A and Plan B. All
shares to be optioned and sold under either Plan A or Plan B may be either
authorized but unissued shares or shares held in the treasury.
(b) Shares of Common Stock that: (i) are repurchased by the Company after
issuance hereunder pursuant to the exercise of an Option, or ii)" \* MERGEFORMAT
(ii) are not purchased by the Optionee prior to the expiration or termination of
the applicable Option, shall again become available to be covered by Options to
be issued hereunder and shall not, as of the effective date of such repurchase
or expiration, be counted as covered by an outstanding Option for purposes of
the above-described maximum number of shares which may be optioned hereunder.
5. OPTION PRICE.
The Option Price for shares of Common Stock to be issued under either Plan
A or Plan B shall be 100% of the fair market value of such shares on the date on
which the Option covering such shares is granted by the Committee, except that
if on the date on which such Option is granted the Optionee is a Restricted
Shareholder, than such Option Price for Options granted under Plan A shall be
110% of the fair market value of the shares of Common Stock subject to the
Option on the date such Option is granted by the Committee. The fair market
value of shares of Common Stock for all purposes of this Plan is to be
determined by the Committee, in its sole discretion, exercised in good faith.
6. TERM OF PLAN.
Plan A and Plan B shall become effective on May 11, 1992; both Plan A and
Plan B shall continue in effect until May 11, 2002, unless terminated earlier by
action of the Board. No Option may be granted hereunder after May 11, 2002.
7. EXERCISE OF OPTION.
Subject to the actions, conditions and limitations set forth in this Plan
document and any applicable Stock Option Agreement entered into hereunder,
Options granted under this Plan shall be exercisable in accordance with the
following rules:
(a) No Shares of Common Stock acquired by the Optionee pursuant to an
exercise of an Option granted under the Plan may be disposed of in whole or
in part until six (6) months after the date on which the Option is granted
by the Committee (hereinafter the "Option Grant Date").
(b) Subject to the specific provisions of this Section 7, Options
shall become exercisable at such times and in such installments (which may
be cumulative) as the Committee shall provide in the terms of each
individual Option; provided, however, that by a resolution adopted after an
Option is granted the Committee, may, on such terms and conditions as it
may determine to be appropriate and subject to the specific provisions of
this Section 7, accelerate the time at which such Option or installment
thereof may be exercised. For purposes of this Plan, any accrued
installment of an Option granted hereunder shall be referred to as an
"Accrued Installment."
(c) Subject to the specific restrictions contained in this Section 7,
an Option may be exercised when Accrued Installments accrue, as provided in
the terms under which such Option was granted, for a period of up to five
(5) years from the Option Grant Date with respect to Options granted under
Plan A and for a period of up to ten (10) years from the Option Grant Date
with respect to Options granted under Plan B. In no event shall any Option
be exercised on or after the expiration of said maximum applicable period,
regardless of the circumstances then existing (including but not limited to
the death or termination of employment of the Optionee).
(d) The Committee shall fix the expiration date of the Option (the
"Option Expiration Date") at the time the Option grant is authorized.
8. RULES APPLICABLE TO CERTAIN DISPOSITIONS.
(a) Notwithstanding the foregoing provisions of Section 7, in the event the
Company or the shareholders of the Company enter into an agreement to dispose of
all or substantially all of the assets or capital stock of the Company by means
of a sale, merger, consolidation, reorganization, liquidation, or otherwise, an
Option shall become immediately exercisable with respect to the full number of
shares subject to that Option during the period commencing as of the later of
(x) date of execution of such agreement or (y) six (6) months after the Option
Grant Date, and ending as of the earlier of:
(i) the Option Expiration Date; or
(ii) the date on which the disposition of assets or capital stock
contemplated by the agreement is consummated. The exercise of any Option
that was made exercisable solely by reason of this Subsection 8(a) shall be
conditioned upon the consummation of the disposition of assets or stock
under the above referenced agreement. Upon the consummation of any such
disposition of assets or stock, this Plan and any unexercised Options
issued hereunder (or any unexercised portion thereof) shall terminate and
cease to be effective.
(b) Notwithstanding the foregoing, in the event that any such agreement
shall be terminated without consummating the disposition of said stock or
assets:
(i) any unexercised nonvested installments that had become exercisable
solely by reason of the provisions of Subsection 8(a) shall again become
nonvested and unexercisable as of said termination of such agreement, and
(ii) the exercise of any option that had become exercisable solely by
reason of this Subsection 8(a) shall be deemed ineffective and such
installments shall again become nonvested and unexercisable as of said
termination of such agreement.
(c) Notwithstanding the provisions set forth in Subsection 8(a), the
Committee may, at its election and subject to the approval of the corporation
purchasing or acquiring the stock or assets of the Company (the "Surviving
Corporation") arrange for the Optionee to receive upon surrender of Optionee's
Option a new option covering shares of the Surviving Corporation in the same
proportion, at an equivalent option price and subject to the same terms and
conditions as the old Option. For purposes of the preceding sentence, the excess
of the aggregate fair market value of the shares subject to such new option
immediately after consummation of such disposition of stock or assets over the
aggregate Option Price of such shares of the Surviving Corporation shall be no
more than the excess of the aggregate fair market value of all shares subject to
the old Option immediately before consummation of such disposition of stock or
assets over the aggregate Option Price of such shares of the Company, and the
new option shall not give the Optionee additional benefits which such Optionee
did not have under the old Option or deprive the Optionee of benefits which the
Optionee had under the old Option. If such substitution of options is
effectuated, the Optionee's rights under the old Option shall thereupon
terminate.
9. MERGERS AND ACQUISITIONS.
If the Company at any time should succeed to the business of another
corporation through a merger or consolidation, or through the acquisition of
stock or assets of such corporation, Options may be granted under the Plan to
option holders of such corporation or its subsidiaries, in substitution for
options or rights to purchase stock of such corporation held by them at the time
of succession. The Committee shall have sole and absolute discretion to
determine the extent to which such substitute Options shall be granted (if at
all), the person or persons within the eligible group to receive such substitute
Options (who need not be all option holders of such corporation), the number of
Options to be received by each such person, the Option Price of such Option, and
the terms and conditions of such substitute Options; provided, however, that the
terms and conditions of the substitute Options shall comply with the provisions
of Section 424 of the Code, such that the excess of the aggregate fair market
value of the shares subject to such substitute Option immediately after the
substitution or assumption over the aggregate option price of such shares is not
more than the excess of the aggregate fair market value of all shares subject to
the substitute Option immediately before such substitution or assumption over
the aggregate option price of such shares, and the substitute Option or the
assumption of the old Option does not give the holder thereof additional
benefits which he did not have under such old Option.
10. TERMINATION OF EMPLOYMENT.
(a) In the event that the Optionee's employment, directorship or consulting
or other arrangement with the Company (or Affiliated Company) is terminated for
any reason other than death or disability, any unexercised Accrued Installments
of the Option granted hereunder to such terminated Optionee shall expire and
become unexercisable as of the earlier of:
(i) the applicable Option Expiration Date; or
(ii) a date 90 days after such termination occurs.
(b) In the event that the Optionee's employment, directorship or consulting
or other arrangement with the Company is terminated due to the death or
disability of the Optionee, any unexercised Accrued Installments of the Option
granted hereunder to such Optionee shall expire and become unexercisable as of
the earlier of:
(i) the applicable Option Expiration Date; or
(ii) the first anniversary of the date of death of such Optionee (if
applicable). Any such Accrued Installments of a deceased Optionee may be
exercised prior to their expiration by (and only by) the person or persons
to whom the Optionee's Option right shall pass by will or by the laws of
descent and distribution, if applicable, subject, however, to all of the
terms and conditions of this Plan and the applicable Stock Option Agreement
governing the exercise of Options granted hereunder.
(c) For purposes of this Section 10, an Optionee shall be deemed employed
by the Company (or Affiliated Company) during any period of leave of absence
from active employment as authorized by the Company (or Affiliated Company).
11. EXERCISE OF OPTIONS.
(a) An Option shall be deemed exercised when written notice of such
exercise has been given to the Company at its principal business office by the
person entitled to exercise the Option and full payment in cash or by certified
bank check (or with shares of Common Stock pursuant to Section 14) for the
shares with respect to which the Option is exercised has been received by the
Company.
(b) An Option may be exercised in accordance with this Section 11 as to all
or any portion of the shares covered by any Accrued Installment of the Option
from time to time during the applicable Option period, but shall not be
exercisable with respect to fractions of a share.
(c) As soon as practicable after any proper exercise of an Option in
accordance with the provisions of this Plan, the Company shall, without charging
transfer or issue tax to the Optionee deliver to the Optionee at the main office
of the Company, or such other place as shall be mutually acceptable, a
certificate or certificates representing the shares of Common Stock as to which
the Option has been exercised. The time of issuance and delivery of the Common
Stock may be postponed by the Company for such period as may be required for it
with reasonable diligence to comply with any applicable listing requirements of
any national or regional securities exchange and any law or regulation
applicable to the issuance and delivery of such shares.
12. AUTHORIZATION TO ISSUE OPTIONS AND SHAREHOLDER APPROVAL.
Unless in the judgment of counsel to the Company such permit is not
necessary with respect to particular grants, Options granted under the Plan
shall be conditioned upon the Company obtaining any required permit from the
California Department of Corporations or any other appropriate governmental
agencies, free of any conditions not acceptable to the Committee, provided,
however, such condition shall lapse as of the effective date of issuance of such
permit(s) in a form to which the Company does not object within sixty (60) days.
The grant of Options under the Plan also is conditioned on approval of the Plan
by the vote or consent of the holders of a majority of the outstanding shares of
the Company's Common Stock and no Option granted hereunder shall be effective or
exercisable unless and until the Plan has been so approved.
13. LIMIT ON VALUE OF OPTIONED SHARES.
The aggregate fair market value (determined as of the Option Grant
Date) of the shares of Common Stock to which Options granted under Plan A are
exercisable for the first time by any employee of the Company during any
calendar year under all incentive stock option plans of the Company and its
Affiliated Companies shall not exceed $100,000. The limitation imposed by this
Section 13 shall not apply with respect to Options granted under Plan B.
14. PAYMENT OF EXERCISE PRICE WITH COMPANY STOCK.
The Committee may provide that, upon exercise of the Option, the Optionee
may elect to pay for all or some of the shares of Common Stock underlying the
Option with shares of Common Stock of the Company previously acquired and owned
at the time of exercise by the Optionee subject to all restrictions and
limitations of applicable laws, rules and regulations, including Section
424(c)(3) of the Code, and provided that the Optionee will make representations
and warranties satisfactory to the Company regarding his title to the shares
used to effect the purchase, including without limitation representations and
warranties that the Optionee has good and marketable title to such shares free
and clear of any and all liens, encumbrances, charges, equities, claims,
security interests, options or restrictions and has full power to deliver such
shares without obtaining the consent or approval of any person or governmental
authority other than those which have already given consent or approval in a
form satisfactory to the Company. The equivalent dollar value of the shares used
to effect the purchase shall be the fair market value of the shares on the date
of the purchase as determined by the Committee in its sole discretion, exercised
in good faith.
The terms and conditions of Options granted under the Plan shall be
evidenced by a Stock Option Agreement (hereinafter referred to as the
"Agreement") executed by the Company and the person to whom the Option is
granted. Each agreement shall contain the following provisions:
(a) A provision fixing the number of shares which may be issued upon
exercise of the Option;
(b) A provision establishing the Option exercise price per share;
(c) A provision establishing the times and the installments in which
Options may be exercised;
(d) A provision incorporating therein this Plan by reference;
(e) A provision clarifying which Options are intended to be incentive
stock options under Plan A and which are intended to be nonstatutory stock
options under Plan B;
(f) A provision fixing the maximum duration of the Option as not more
than five (5) years from the Option Grant Date for Options granted under
Plan A and not more than ten (10) years from the Option Grant Date for
Options granted under Plan B;
(g) Such representations and warranties by the Optionee as may be
required by Section 24 of this Plan or as may be required by the Committee
in its discretion;
(h) Any other restriction (in addition to those established under this
Plan) as may be established by the Committee with respect to the exercise
of the Option, the transfer of the Option, or the transfer of the shares
purchased by exercise of the Option, provided that such restrictions are
not in conflict with this Plan; and
(i) Such other terms and conditions not inconsistent with this Plan as
may be established by the Committee.
15. TAXES, FEES AND EXPENSES.
The Company shall pay all original issue and transfer taxes (but not income
taxes, if any) with respect to the grant of Options and the issue and transfer
of shares pursuant to the exercise of such Options, and all other fees and
expenses necessarily incurred by the Company in connection therewith, and will
from time to time use its best efforts to comply with all laws and regulations
which, in the opinion of counsel for the Company, shall be applicable thereto.
16. WITHHOLDING OF TAXES.
The grant of Options hereunder and the issuance of Common Stock pursuant to
the exercise of such Options is conditioned upon the Company's reservation of
the right to withhold, in accordance with any applicable law, from any
compensation payable to the Optionee any taxes required to be withheld by
Federal, state or local law as a result of the grant or exercise of any such
Option.
17. AMENDMENT OR TERMINATION OF THE PLAN.
(a) The Board may amend this Plan from time to time in such respects as the
Board may deem advisable; provided, however, that no such amendment shall
operate to (i) affect adversely an Optionee's rights under this Plan with
respect to any Option granted hereunder prior to the adoption of such amendment,
except as may be necessary, in the judgment of counsel to the Company, to comply
with any applicable law, (ii) increase the maximum aggregate number of shares
which may be optioned and sold under the Plan, (iii) change the manner of
determining the option exercise price, (iv) change the classes of persons
eligible to receive Options under the Plan, or (v) extend the maximum duration
of the Option or the Plan.
(b) The Board may at any time terminate this Plan. Any such termination of
the Plan shall not, without the written consent of the Optionee, alter the terms
of Options already granted and such Options shall remain in full force and
effect as if this Plan had not been terminated.
18. OPTIONS NOT TRANSFERABLE.
Options granted under this Plan may not be sold, pledged, hypothecated,
assigned, encumbered, gifted or otherwise transferred or alienated in any
manner, either voluntarily or involuntarily by operation of law, otherwise than
by will or the laws of descent of distribution, and may be exercised during the
lifetime of an Optionee only by such Optionee.
19. NO RESTRICTIONS ON TRANSFER OF STOCK.
Common Stock issued pursuant to the exercise of an Option granted under
this Plan (hereinafter "Optioned Stock"), or any interest in such Optioned
Stock, may be sold, assigned, gifted, pledged, hypothecated, encumbered or
otherwise transferred or alienated in any manner by the holder(s) thereof,
subject, however, to any representations or warranties requested under Section
24 of this Plan and also subject to compliance with any applicable Federal,
state or other local law, regulation or rule governing the sale or transfer of
stock or securities and subject further to the six-month holding period set
forth above in Section 7(a).
20. RESERVATION OF SHARES OF COMMON STOCK.
The Company, during the term of this Plan, will at all times reserve and
keep available such number of shares of its Common Stock as shall be sufficient
to satisfy the requirements of the Plan.
21. RESTRICTIONS ON ISSUANCE OF SHARES.
The Company, during the term of this Plan, will use its best efforts to
seek to obtain from the appropriate regulatory agencies any requisite
authorization in order to grant Options or issue and sell such number of shares
of its Common Stock as shall be sufficient to satisfy the requirements of the
Plan. The inability of the Company to obtain from any such regulatory agency
having jurisdiction thereof the authorization deemed by the Company's counsel to
be necessary to the lawful grant of Options or the issuance and sale of any
shares of its stock hereunder or that inability of the Company to confirm to its
satisfaction that any grant of Options or issuance and sale of any shares of
such stock will meet applicable legal requirements shall relieve the Company of
any liability in respect of the nonissuance or sale of such stock as to which
such authorization or confirmation have not been obtained.
22. NOTICES.
Any notice to be given to the Company pursuant to the provisions of this
Plan shall be addressed to the company in care of its Chief Financial officer at
its principal office, and any notice to be given to a person to whom an Option
is granted hereunder shall be addressed to him at the address given beneath his
signature on his or her Stock Option Agreement, or at such other address as such
person or his or her transferee (upon the transfer of Optioned Stock) may
hereafter designate in writing to the Company. Any such notice shall be deemed
duly given when enclosed in a properly sealed envelope or wrapper addressed as
aforesaid, registered or certified, and deposited, postage and registry or
certification fee prepaid, in a post office or branch post office regularly
maintained by the United States Postal Service. It shall be the obligation of
each Optionee and each transferee holding Optioned Stock to provide the Chief
Financial Officer of the Company, by letter mailed as provided hereinabove, with
written notice of his correct mailing address.
23. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
If the outstanding shares of Common Stock of the Company are increased,
decreased, changed into or exchanged for a different number or kind of shares of
the Company through reorganization, recapitalization, reclassification, stock
dividend, stock split or reverse stock split, then upon proper authorization of
the Committee an appropriate and proportionate adjustment shall be made in the
number or kind of shares which may be issued upon exercise of Options granted
under the Plan; provided, however, that no such adjustment need be made if, upon
the advice of counsel, the Committee determines that such adjustment may result
in the receipt of federally taxable income to holders of Options granted
hereunder or the holders of Common Stock or other classes of the Company's
securities.
24. REPRESENTATIONS AND WARRANTIES.
As a condition to the grant of any Option hereunder or the exercise of any
portion of an Option, the Company may require the person to be granted or
exercising such Option to make any representation and warranty to the Company as
may, in the judgment of counsel to the Company, be required under any applicable
law or regulation, including but not limited to a representation and warranty
that the Option and shares issuable or issued upon exercise of such Option are
being acquired only for investment and without any present intention to sell or
distribute such Option or shares, as the case may be, if, in the opinion of
counsel for the Company, such representation is required under the Securities
Act of 1933, as amended (the "Act"), or any other applicable law, regulation or
rule of any governmental agency.
25. NO ENLARGEMENT OF EMPLOYEE RIGHTS.
This Plan is purely voluntary on the part of the Company, and while the
Company hopes to continue it indefinitely, the continuance of the Plan shall not
be deemed to constitute a contract between the Company and any employee, or to
be consideration for or a condition of the employment of any employee. Nothing
contained in the Plan shall be deemed to give any employee the right to be
retained in the employ of the Company or its Affiliated Companies, or to
interfere with the right of the Company or an Affiliated Company to discharge or
retire any employee thereof at any time. No employee shall have any right to or
interest in Options authorized hereunder prior to the grant of such an Option to
such employee, and upon such grant he shall have only such rights and interests
as are expressly provided herein, subject, however, to all applicable provisions
of the Company's Articles of Incorporation, as the same may be amended from time
to time.
26. INFORMATION TO OPTION HOLDERS.
During the period any options granted to employees of the Company remain
outstanding, such employee-option holders shall be entitled to receive, on an
annual or other periodic basis, financial and other information regarding the
Company. The committee shall exercise its discretion with regard to the nature
and extent of the financial information so provided, giving due regard to the
size and circumstances of the Company and, if the Company provides annual
reports to its shareholders, the Company's practice in connection with such
annual reports. Notwithstanding the above, if the issuance of options under
either Plan A or Plan B is limited to key employees whose duties in connection
with the Company assure their access to equivalent information, this Section 26
shall not apply to such employees and plan.
27. LEGENDS OF STOCK CERTIFICATES.
Each certificate representing Common Stock issued under this Plan shall
bear whatever legends are required by Federal or state law or by any
governmental agency. In particular, unless an appropriate registration statement
is filed pursuant to the Act with respect to the shares of Common Stock issuable
under this Plan, each certificate representing such Common Stock shall be
endorsed on its face with the following legend or its equivalent:
"Neither the Option pursuant to which the shares represented
by this certificate are issued nor said shares have been
registered under the Securities Act of 1933, as amended (the
"Act"). Transfer or sale of such securities or any interest
therein is unlawful except after registration, or pursuant to an
exemption from the registration requirements, as provided in the
Act and the regulations thereunder."
A copy of this Plan shall be delivered to the Chief Financial Officer of
the Company and shall be shown by him to each eligible person making reasonable
inquiry concerning it. A copy of this Plan also shall be delivered to each
Optionee at the time his or her Options are granted.
28. SPECIFIC PERFORMANCE.
The Options granted under this Plan and the Optioned Stock issued pursuant
to the exercise of such Options cannot be readily purchased or sold in the open
market, and, for that reason among others, the Company and its shareholders will
be irreparably damaged in the event that this Plan is not specifically enforced.
In the event of any controversy concerning the right or obligation to purchase
or sell any such Option or Optioned Stock, such right or obligation shall be
enforceable in a court of equity by a decree of a specific performance. Such
remedy shall, however, be cumulative and not exclusive, and shall be in addition
to any other remedy which the parties may have.
29. INVALID PROVISION AND COMPLIANCE WITH 16b-3.
In the event that any provision of this Plan is found to be invalid or
otherwise unenforceable under any applicable law, such invalidity or
unenforceability shall not be construed as rendering any other provisions
contained herein invalid or unenforceable, and all such other provisions shall
be given full force and effect to the same extent as though the invalid or
unenforceable provision was not contained herein.
With respect to persons subject to Section 16 of the Securities Exchange
Act of 1934, as amended (the "1934 Act"), transactions under this Plan are
intended to comply with all applicable conditions of Rule 16b-3 or its
successors under the 1934 Act. To the extent any provision of the Plan or action
by the Committee fails to so comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Committee.
30. APPLICABLE LAW.
This Plan shall be governed by and construed in accordance with the laws of
the State of California.
31. SUCCESSORS AND ASSIGNS.
This Plan shall be binding on and inure to the benefit of the Company and
the employees to whom an Option is granted hereunder, and such employees' heirs,
executors, administrators, legatees, personal representatives, assignees and
transferees.
IN WITNESS WHEREOF, pursuant to the due authorization and adoption of this
Plan by the Board on May 11, 1992, the Company has caused this Plan to be duly
executed by its duly authorized officers.
KENNEDY-WILSON, INC., a
Delaware Corporation
BY: /s/ William J. McMorrow
---------------------------
William J. McMorrow,
Chief Executive Officer
<PAGE>
BY: /s/ William R. Stevenson
---------------------------
William R. Stevenson,
President
AMENDMENT NO. 1
TO THE
KENNEDY-WILSON, INC. 1992 INCENTIVE
AND NONSTATUTORY STOCK OPTION PLAN
WHEREAS Kennedy-Wilson Inc. (the "Company") has adopted the Kennedy-Wilson,
Inc. 1992 Incentive and Nonstatutory Stock Option Plan (the "Plan"); and
WHEREAS, Section 17 of the Plan permits the Board of Directors of the
Company to amend the Plan, subject to certain limitations; and
WHEREAS, the Board of Directors of the Company now desires to amend the
Plan in certain respects;
NOW, THEREFORE, the Plan is hereby amended as follows:
FIRST: Subsection (a) of Section 4 of the Plan is hereby amended by
deleting the number "750,000" wherever it appears and by inserting the number
"1,400,000" in its stead.
SECOND: Subsection (b) of Section 4 of the Plan is hereby deleted, in its
entirety, and replaced with the following:
"(b) Shares of Common Stock that are not purchased by the Optionee
prior to the expiration or termination of the applicable Option shall again
become available to be covered by Options to be issued hereunder and shall
not, as of the effective date of such expiration or termination, be counted
as covered by an outstanding Option for purposes of the above-described
maximum number of shares which may be optioned hereunder.
(c) During any calendar year no executive officer of the Company may
receive options in excess of the number then remaining available for grant
under the Plan."
THIRD: Clause (a) of Section 7 of the Plan is hereby amended, in its
entirety, to read as follows:
"(a) No Shares of Common Stock acquired by the Optionee pursuant to an
exercise of an Option granted under the Plan may be disposed of in whole or
in part until six (6) months after the later of i)" \* MERGEFORMAT (i) the
date on which the Option is granted by the Committee (hereinafter the
"Option Grant Date"), ii)" \* MERGEFORMAT (ii) with respect to persons
subject to Section 16 of the Act (as defined in Section 29 hereof), the
date of shareholder approval of an amendment to the Plan if such amendment
is subject to shareholder approval and the Option is granted subject to
such shareholder approval or iii)" \* MERGEFORMAT (iii) with respect to
persons subject to Section 16 of said Act, the date of any amendment of an
Option which is deemed to be the grant of a new option under Rule 16b-3 of
said Act, to the extent that such Option was not theretofore exercised."
FOURTH: Subsection (a) of Section 17 of the Plan is hereby amended, in its
entirety, to read follows:
"(a) The Board may amend this Plan from time to time in such respects
as the Board may deem advisable; provided, however, that no such amendment
shall operate to affect adversely an Optionee's rights under this Plan with
respect to any Option granted hereunder prior to the adoption of such
amendment, except with the written consent of the Optionee or as may be
necessary, in the judgment of counsel to the Company, to comply with any
applicable law. Notwithstanding the preceding, any amendment which would
(i) operate to increase the maximum aggregate number of shares which may be
optioned and sold under the Plan or change the classes of persons eligible
to receive Options under the Plan, or (ii) require shareholder approval
under any applicable law, rule or regulation, shall be subject to
shareholder approval in accordance with applicable laws, rules or
regulations."
FIFTH: The provisions of this Amendment shall be effective as of the date
of execution hereof; provided however, that if this Amendment is not approved by
the shareholders of the Company in accordance with applicable Federal and state
law (and the rules and regulations thereunder), this Amendment and any options
granted pursuant to the provisions hereof shall be void and of no force or
effect.
SIXTH: Except to the extent hereinabove set forth, the Plan shall remain in
full force and effect.
IN WITNESS WHEREOF, the Board of Directors of the Company has caused this
Amendment to be executed by a duly authorized officer of the Company on the 2nd
day of August, 1993.
KENNEDY-WILSON, INC.
AMENDMENT [No. 2] TO THE
KENNEDY-WILSON, INC. 1992 INCENTIVE
AND NONSTATUTORY STOCK OPTION PLAN
WHEREAS, Kennedy-Wilson, Inc. (the "Company") has adopted the
Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option Plan (the
"Plan"); and
WHEREAS, Section 17 of the Plan permits the Board of Directors of the
Company to amend the Plan, subject to certain limitations; and
WHEREAS, the Board of Directors of the Company now desires to amend the
Plan to increase the number of shares of Common Stock under the Plan (the
"Amendment");
NOW, THEREFORE, the Plan is hereby amended as follows:
1. Subsection (a) of Section 4 of the Plan is hereby amended by deleting
the number "140,000" wherever it appears and by inserting the number "200,000"
in its stead.
2. The provisions of this Amendment shall be effective as of the date of
execution hereof; provided, however, that if this Amendment is not approved by
the stockholders of the Company in accordance with applicable Federal and state
law (and the rules and regulations thereunder), this amendment and any options
granted pursuant to the provisions hereof shall be void and of no force or
effect.
3. Except to the extent set forth above, the Plan is not otherwise modified
and shall remain in full force and effect.
IN WITNESS WHEREOF, the Board of Directors of the Company has caused this
Amendment to be authorized and adopted by the Company on the 19th day of August,
1997.
KENNEDY-WILSON, INC.
Note: On October 27, 1997, the Company paid a 20% stock dividend. Pursuant to
the antidilution provisions of the Plan, the number of shares of Common Stock
reserved for issuance under the Plan increased to 240,000.
AMENDMENT NO. 3 TO THE 1992
INCENTIVE AND NONSTATUTORY STOCK OPTION PLAN
WHEREAS, Kennedy-Wilson, Inc., a Delaware corporation (the "Company") has
adopted the Kennedy-Wilson, Inc. 1992 Incentive and Nonstatutory Stock Option
Plan (as amended, the "Plan"), and
WHEREAS, Section 4 of the Plan provides that the number of shares on which
options may be granted is 240,000;
WHEREAS, as a result of stock dividends the number of shares on which
options may be granted has been increased in accordance with the terms of the
Plan to 1,080,000; and
WHEREAS the Board of Directors of the Company has approved amending the
Plan to increase the number of shares of common stock under the Plan to
1,700,000;
NOW, THEREFORE, the Plan is hereby amended as follows:
1. Section 4(a) of the Plan is hereby amended by deleting the number
"240,000" wherever it appears and by inserting the number " 1,700,000" in its
stead.
2. This amendment to the Plan shall be effective as of the date of
execution hereof, provided, however, that if this amendment is not approved by
the stockholders of the Company in accordance with applicable federal and state
law (and the rules and regulations thereunder), this amendment shall be void and
of no force or effect.
3. Except to the extent set forth above, the Plan is not otherwise modified
and shall remain in full force and effect.
IN WITNESS WHEREOF, the Board of Directors of the Company has caused this
Amendment to be executed by unanimous written consent on the 19th day of
February 1999.
1992 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
Section 1. Purpose of Plan.
The purpose of this 1992 Non-Employee Director Stock Option Plan (the
"Plan") of Kennedy-Wilson, Inc., a Delaware corporation (the "Company"), is to
provide present and prospective directors of the Company who are not employed by
the Company with the opportunity to obtain equity ownership interests in the
Company through the exercise of stock options.
Section 2. Persons Eligible Under Plan.
Participation in this Plan is limited to non-employee directors. A
non-employee director (referred to herein as a "Director") is a director of the
Company who, at the time stock options are granted to him or her under the Plan,
is not an employee of the Company or of any subsidiary of the Company.
Section 3. Administration.
This Plan shall be administered by the Board of Directors (the "Board") of
the Company. The grant of options (the "Options") to purchase shares of Common
Stock, par value $.01 per share, of the Company (the "Common Shares") under this
Plan and the amount, price and nature of the awards shall be automatic as
described in Section 4. However, subject to the provisions of this Plan, the
Board, in its sole and absolute discretion, is authorized to do all things
necessary or desirable in connection with the administration of this Plan,
including, without limitation, the following:
(i) subject to Section 8, adopt, amend and rescind rules and
regulations relating to this Plan;
(ii) determine whether, and the extent to which, adjustments are
required pursuant to Section 7 hereof; and
(iii)interpret and construe this Plan and the terms and conditions of
any Option granted hereunder.
Section 4. Terms and Conditions of Options.
(a) Amount, Exercise Price and Exercisability of Initial Grants. Each
Director shall automatically be granted on the date of the adoption of the Plan
by the Company's stockholders or on the date of such Directors' election to the
Board of Directors, whichever occurs later (the "Date of Initial Grant") an
Option to purchase 25,000 Common Shares (subject to adjustment as provided in
Section 7). The exercise price for each option granted pursuant to this Section
4 (a) shall be (i) if the option is granted on the date of adoption of the Plan,
the value of the Common Shares calculated using the initial public offering
price of the Common Shares, or (ii) if granted upon such Director's election to
the Board of Directors, the Fair Market Value (as defined in Section 4(b) below)
of the Common Shares at the close of business on the date preceding the Date of
Initial Grant (the "Exercise Price").
(b) Amount, Exercise Price and Exercisability of Automatic Annual Grants.
Each Director shall automatically be granted, on the date of such Director's
re-election to the Board of Directors (the "Date of Grant") at the Company's
annual meeting of stockholders (the "Annual Meeting") an Option to purchase
1,000 Common Shares (subject to adjustment as provided in Section 7). The
exercise price for each Option granted pursuant to this Section 4(b) shall be
the Fair Market Value (as defined below) of the Common Shares at the close of
business on the date preceding the Date of Grant (the "Exercise Price"). The
"Fair Market Value" of a Common Share on any day shall be equal to the last sale
price per Common Share on such day or, in case no such sale takes place on such
day, the average of the closing bid and asked prices in either case as reported
in the principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on the NASDAQ National Market System
("NMS"), or, if the Common Shares are not listed or admitted to trading on the
NMS, as reported in the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities exchange on
which the Common Shares are listed or admitted to trading or, if the Common
Shares are not listed or admitted to trading on any national securities exchange
or the NMS, the last quoted price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by the
National Association of Securities Dealers, Inc. Automated Quotations System or
such other system then in use or, if on any such date the Common Shares are not
quoted by any such organization, the average of the closing bid and asked prices
as furnished by a professional market maker making a market in the Common Shares
who is selected in good faith by the Board of Directors of the Company.
(c) Vesting. An Option granted under Section 4(a) of this Plan shall vest
and become exercisable on the first anniversary of the Date of Initial Grant,
but only if the recipient of such Option (the "Optionee") continues to serve as
a Director for at least one year from the Date of Initial Grant. An Option
granted under Section 4(b) of this Plan shall vest and become exercisable on the
date of the Annual Meeting following the Date of Grant of such option, but only
if the Optionee continues to serve as a Director until at least the date of the
Annual Meeting following the Date of Grant of such Option.
(d) Manner of Exercise. Any vested and exercisable Option may be exercised
by the holder thereof by giving written notice, signed by such holder, to the
Company stating the number of Common Shares with respect to which the Option is
being exercised, accompanied by payment in full of the aggregate Exercise Price
in cash or by check payable to the Company. No Option may be exercised with
respect to any fractional share; cash shall be paid in lieu of fractional
shares. As promptly as practicable following the receipt of a notice hereunder,
the Company shall issue a stock certificate registered in the name of the
Director exercising such Option, representing the number of Common Shares issued
to such Director upon exercise of the Option.
(e) Termination or Expiration. Each Option shall expire on the earlier of
the tenth anniversary of the Date of Grant or ninety (90) days after the date
the Optionee ceases to be a Director of the Company, whichever comes first.
(f) Transferability. Neither the Option nor any interest therein may be
sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred
in any manner other than by will or the laws of descent and distribution. During
the recipient's lifetime, an Option may only be exercised by the Optionee or the
Optionee's guardian or legal representative.
(g) Payment of Withholding Taxes. If the Company is obligated by law to
withhold an amount on account of any Federal, state or local tax imposed as a
result of the exercise of the option (such amount shall be referred to herein as
the "Withholding Liability"), the Optionee shall, on the first date upon which
the Company becomes obligated to pay the Withholding Liability to the
appropriate taxing authority pay the Withholding Liability to the Company in
full in cash or by check.
(h) Stock Exchange Requirements; Applicable Law. Notwithstanding anything
to the contrary in this Plan, no Common Shares purchased upon exercise of the
Option, and no certificate representing all or any part of such shares, shall be
issued or delivered if (a) such shares have not been admitted to listing upon
official notice of issuance on the NMS or on each stock exchange upon which
shares of that class are then listed or (b) in the opinion of counsel to the
Company, such issuance or delivery would cause the Company to be in violation of
or to incur liability under any Federal, state or other securities law, or any
requirement of any listing agreement to which the Company is a party, or any
other requirement of law or of any administrative or regulatory body having
jurisdiction over the Company. It is the Company's intent that this Plan comply
in all respects with Rule 16b-3 of the Securities Exchange Act of 1934, as
amended (the "Act"), and any regulations promulgated thereunder. If any
provision of this Plan is later found not to be in compliance with Rule 16b-3,
such provision shall be deemed null and void. All grants and exercises of
Options under this Plan shall be executed in accordance with the requirements of
Section 16 of the Act and any regulations promulgated thereunder.
(i) Stock Option Agreement. Each grant of an Option under this Plan shall
be evidenced by an agreement duly executed on behalf of the Company and the
Optionee, dated as of the applicable Date of Grant. Each such agreement shall
set forth the number of Common Shares subject to the Option, the Exercise Price
and the date upon which the Option becomes exercisable and shall incorporate by
reference the terms and conditions of this Plan.
Section 5. Stock Subject to Plan.
(a) The maximum number of Common Shares that may be issued pursuant to all
Options granted under this Plan is 150,000, subject to adjustment as provided in
Section 7 hereof (such maximum number, as so adjusted, shall be referred to
herein as the "Share Limitation").
(b) Notwithstanding Section 4 of this Plan, no option shall be granted
under this Plan unless, on the date of grant, the sum of (i) the maximum number
of Common Shares issuable at any time pursuant to such option, plus (ii) the
number of Common Shares that have previously been issued pursuant to the
exercise of options granted under this Plan, plus (iii) the maximum number of
Common Shares that may be issued at any time thereafter pursuant to the exercise
of options granted under this Plan that are outstanding on such date, does not
exceed the Share Limitation.
Section 6. Duration of Plan.
(a) No options shall be granted under this Plan after May 11, 2002.
Although Common Shares may be issued after May 11, 2002 pursuant to Options
granted prior to such date, no Common Shares shall be issued under this Plan
after May 11, 2012.
Section 7. Adjustments for Changes in Capitalization.
If the outstanding securities of the class then subject to this Plan are
increased, decreased, changed into or exchanged for a different number or kind
of shares of the Company through reorganization, recapitalization,
reclassification, stock dividend, stock split or reverse stock split, upon
proper authorization of the Board of Directors, an appropriate and proportionate
adjustment shall be made in (a) the number and type of shares or other
securities or cash or other property that may be acquired pursuant to Options
theretofore granted under this Plan and (b) the maximum number and type of
shares or other securities that may be issued pursuant to Options thereafter
granted under this Plan.
Section 8. Amendment and Termination of Plan.
The Board may amend or terminate this Plan at any time and in any manner.
However, (a) no such amendment or termination shall deprive the recipient of any
option theretofore granted under this Plan, without the consent of such
recipient, of any of his or her rights thereunder or with respect thereto, (b)
no such amendment shall be effective without the approval of the stockholders of
the Company, if stockholder approval of the amendment is then required pursuant
to Rule 16b-3 under the Act, or the applicable rules of any securities exchange,
and (c) to the extent prohibited by Rule 16b-3(c)(2)(ii)(B) under the Act, this
Plan may not be amended more than once every six months.
Section 9. Effective Date of Plan.
This Plan shall be effective as of May 11, 1992, the date upon which it was
approved by the Board; provided, however, that no Common Shares may be issued
under this Plan until it has been approved, directly or indirectly, by the
affirmative votes of the holders of a majority of the securities of the Company
present, or represented, and entitled to vote at a meeting duly held in
accordance with the laws of the State of Delaware or by the unanimous written
consent of such holders.
Section 10. No Rights as Stockholder and Rights of Directors.
Neither an Optionee nor an Optionee's successor or successors in interest
shall have rights as a stockholder of the Company with respect to any Common
Shares subject to an Option granted to such person until the date of issuance of
a stock certificate for such Common Shares. Neither this Plan, nor the granting
of an Option hereunder, nor any other action taken pursuant to this Plan shall
constitute or be evidence of any agreement or understanding, express or implied,
that a Director has a right to continue as a Director for any period of time or
at any particular rate of compensation.
Section 11. Governing Law.
This Plan and all rights and obligations under this Plan shall be construed
in accordance with and governed by the laws of the State of Delaware.
[FORM OF]
KENNEDY-WILSON, INC.
STOCK OPTION AGREEMENT
This Agreement is made effective as of the ____ day of ________, [1999]
[2000] (the "Option Grant Date"), by and between Kennedy-Wilson, Inc., a
Delaware corporation (the "Company") and, _______________________ (the
"Optionee")
RECITALS
WHEREAS, the Board of Directors of the Company has established the 1992
Incentive and Nonstatutory Stock Option Plan effective as of May 11, 1992 (such
Plan as heretofore amended and as hereafter amended subject to the terms hereof,
the "Plan") and unless indicated otherwise, capitalized terms used herein and
not defined shall have the meaning ascribed to them in the Plan; and
WHEREAS, pursuant to the provisions of said Plan, the Board of Directors of
the Company (acting through a committee of the Board, the "Committee"), by
action duly taken on ___________ [1999] [2000], determined to grant to the
Optionee an option or options (the "Option(s)" to purchase shares of the common
stock of the Company ("Common Stock") on the terms and conditions set forth
herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants set forth herein and other good and valuable consideration, the
parties hereto agree as follows:
1. THE OPTION(S). The Optionee may, at his or her option, purchase all or
any part of an aggregate of _______shares of Common Stock (the "Optionee
shares"), at the price of $_____per share (the "Option Price"), on the terms and
conditions set forth herein.
2. PLAN TYPE; EXERCISE DATES AND EXERCISE. Options intended to qualify as
incentive stock options under Plan A of the Plan (as defined in the Plan) are
designated by an "A" under the category "Plan." Options intended as separate
nonstatutory options under Plan B of the Plan are designated by a "B" under the
category "Plan." The Option(s) shall be exercisable as to the aggregate
specified number of Optionee shares on and after the "First" dates and on or
before the "Last" dates set forth below:
PLAN NUMBER OF SHARES FIRST EXERCISE DATE LAST EXERCISE DATE
[A] [B]
[A] [B]
[A] [B]
Optionee acknowledges that he or she understands he or she has no right
whatsoever to exercise the Option(s) granted hereunder with respect to any
Optionee Shares covered by an installment until such installment accrues as
provided above. Optionee understands that the Option(s) granted hereunder shall
expire and become unexercisable as provided in section 3(c) below.
This Option shall be deemed exercised as to shares of Common Stock when
written notice of such exercise has been given to the Company at its principal
business office by the Optionee specifying the number of shares of Common Stock
to be purchased. Such notice shall be accompanied by full payment of the Option
Price (i) in cash or by certified bank check, (ii) with shares of Common Stock
pursuant to Section 14 of the Plan or (iii) by any combination of (i) and (ii)
as may be determined by the Committee with respect to the Common Stock to be
purchased, and as may be set forth in a letter from the Company accompanying
this Agreement.
[Optionee acknowledges that shares of Common Stock are not currently
available under the Plan in respect of the Options granted hereunder. If the
Plan is not amended within one year after the date hereof to increase the number
of shares of Common Stock under the Plan so that such Options may be exercised,
the Options shall, without any further action on the part of the Company, be
canceled.]
3. GOVERNING PLAN. This Agreement hereby incorporates by reference the Plan
and all of the terms and conditions of the Plan as heretofore amended and as the
same may be amended from time to time hereafter in accordance with the terms
hereof, but no such subsequent amendment shall adversely affect the Optionee's
rights under this Agreement and the Plan. The Optionee expressly acknowledges
and agrees that the provisions of this Agreement are subject to the Plan; the
terms of this Agreement shall in no manner limit or modify the controlling
provisions of the Plan, and in case of any conflict between the provisions of
the Plan and this Agreement, the provisions of the Plan shall be controlling and
binding upon the parties hereto.
The Optionee also hereby expressly:
(A) Acknowledges receipt of a copy of the Plan, a copy of which is attached
hereto and by reference herein, and represents that he or she is familiar with
the terms and provisions of said Plan, and hereby accepts this Agreement subject
to all the terms and provisions of said Plan.
(B) Agrees to accept as binding, conclusive and final all decisions or
interpretations of the Committee upon any questions arising under the Plan.
(C) Acknowledges that he or she is familiar with sections of the Plan
regarding the exercise of the Option(s) and represents that he or she
understands that said Option(s) must be exercised on or before the earliest of
the following dates, whichever is applicable: (I) the last exercise date noted
above in Section 2; (ii) the day prior to the fifth anniversary of the Option(s)
Grant Date with respect to Options granted under Plan A and the day prior to the
tenth anniversary of the Option(s) Grant Date with respect to Options granted
under Plan B, in each case as provided in Subsection 7(c) of the Plan; (iii) the
effective date of the sale or other disposition of all or substantially all of
the stock or assets of the Company, as provided in Subsection 8(a) of the Plan;
(iv) the date which is 90 days following the Optionee's termination of
employment, directorship or consulting arrangement for any reason other than
death or disability as provided under Section 10 of the Plan; or (v) the date
that is one year following the Optionee's termination of employment,
directorship or consulting arrangement by reason of his or her death or
disability.
(D) Acknowledges, understands and agrees that the existence of the Plan and
the execution of this Agreement are not sufficient by themselves to cause any
exercise of any Option(s) granted under Plan A to qualify for favorable tax
treatment through the application of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"); that Optionee must, in order to so qualify
individually meet by his or her own action all applicable requirements of
Section 422 of the Code, including without limitation the following employment
requirement:
(1) Holding period requirement: no disposition of an Optionee share
may be made by Optionee within two (2) years from the date of the granting
of the Option(s) or within one (1) year after the transfer of such Optionee
share to him or her; and
(2) Employment requirement: at all times during the period beginning
on the date of the granting of the Option(s) and ending on the day three
(3) months before the date of exercise, the Optionee must have been an
employee of the Company, its parent or a subsidiary of the Company, or a
corporation or a parent of subsidiary of such corporation issuing or
assuming the Option(s) in a transaction to which Section 424(a) of the Code
applies, except where the termination of employment is by means of the
Optionee's disability, in which case said 3-month period may be extended to
1 year, as provided under Section 422 of the Code.
4. REPRESENTATIONS AND WARRANTIES. As a condition to the exercise of any
portion of an Option, the Company may require the person exercising such Option
to make any representation and warranty to the Company as may, in the judgement
of counsel to the Company, be required under any applicable law or regulation
including but not limited to a representation and warranty that the Common Stock
is being acquired only for investment and without any present intention to sell
or distribute such shares if, in the opinion of counsel for the Company, such a
representation is required under the Securities Act of 1933, as amended, or any
other applicable law, regulation or rule of any governmental agency. Optionee
hereby represents to the Company that each of the Options evidenced hereby and
the Common Stock purchasable upon exercise thereof is being acquired only for
investment and without any present intention to sell or distribute such
securities.
5. OPTIONS NOT TRANSFERABLE. The Option(s) may be exercised during the
lifetime of the Optionee only by the Optionee. The Optionee's rights and
interests under this Agreement and in and to the Option(s) may not be sold,
pledged, hypothecated, assigned, encumbered, gifted or otherwise transferred in
any manner, either voluntarily or involuntarily by operation of law, except by
will or the laws of descent or distribution.
6. NO ENLARGEMENT OF EMPLOYEE RIGHTS. Nothing in this Agreement shall be
construed to confer upon the Optionee (if an employee) any right to continued
employment with the Company (or an Affiliated Company), or to restrict in any
way the right of the Company (or an Affiliated Company) if he or she is an
employee thereof) to terminate his or her employment. Optionee acknowledges that
unless an express written employment agreement between Optionee and the Company
provides to the contrary, Optionee's employment with the Company may be
terminated by the Company at any time, with or without cause.
7. WITHHOLDING TAXES. Optionee authorizes the Company to withhold, in
accordance with any applicable law, from any compensation payable to him or her
any taxes required to be withheld by Federal, state or local law as a result of
the grant of the Option(s) or the issuance of stock pursuant to the exercise of
such Option(s).
8. LAWS APPLICABLE TO CONSTRUCTION. This Agreement shall be construed and
enforced in accordance with the laws of the state of California.
9. AGREEMENT BINDING ON SUCCESSORS. The terms of this Agreement shall be
binding upon the executors, administrators, heirs, successors, transferees and
assignees of the Optionee.
10. COST OF LITIGATION. In any action at law or in equity to enforce any of
the provisions or rights under this Agreement or the Plan, the unsuccessful
party to such litigation, as determined by the court of final judgment or
decrees, shall pay the successful party or parties all costs, expenses and
reasonable attorneys' fees incurred by the successful party or parties
(including without limitation costs, expenses and fees on any appeals), and if
the successful party recovers judgment in any such action or proceeding, such
costs, expenses and attorneys' fees shall be included as part of the judgment.
11. NECESSARY ACTS. The Optionee agrees to perform all acts and execute and
deliver any documents that may reasonably necessary to carry out the provisions
of this Agreement, including, but not limited to, all acts and documents related
to compliance with Federal or state securities laws.
12. COUNTERPARTS. For convenience, this Agreement may be executed in any
number of identical counterparts, each of which shall be deemed a complete
original in itself and may be introduced in evidence or used for any other
purpose without the production of any other counterpart.
13. INVALID PROVISIONS. In the event that any provision of this Agreement
is found to be invalid or otherwise unenforceable under any applicable law, such
invalidity or unenforceability shall not be construed as rendering any other
provisions contained herein invalid or unenforceable, and all other provisions
shall be given full force and effect to the same extent as though the invalid
and unenforceable provision was not contained herein.
14. LIMITATION ON VALUE OF OPTIONEE SHARES. Optionee acknowledges that the
Plan provides that the aggregate fair market value (determined as of the date
hereof) of the shares of Common Stock to which Options granted under Plan A are
exercisable for the first time by Optionee during any calendar year under all
incentive stock option plans of the Company and its Affiliated Companies shall
not exceed $100,000. It is understood and agreed that should it be determined
that an Option, if granted pursuant to Plan A hereunder, would exceed such
maximum, such Option shall not be considered granted under Plan A to the extent,
but only to the extent of such excess. This limitation shall not apply to any
Option granted under Plan B.
IN WITNESS WHEREOF, the Company and the Optionee have executed this
Agreement, effective as of the date first written hereinabove.
KENNEDY-WILSON, INC. OPTIONEE
A DELAWARE CORPORATION
BY:_______________________________ ________________________________
TITLE_____________________________ ADDRESS: _______________________
CITY : _________________________
COUNTRY: _______________________
SOCIAL SECURITY NO.:____________
By his or her signature below, the spouse of the Optionee acknowledges that
he or she has read this Agreement and the Plan and is familiar with the terms
and provisions thereof, and agrees to be bound by all terms and conditions of
said Agreement and said Plan document.
________________________________
Spouse
________________________________
Dated:
By his or her signature below the Optionee represents that he or she is not
legally married as of the date of execution of the Agreement:
________________________________
OPTIONEE
________________________________
Dated:
[FORM OF]
KENNEDY-WILSON, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
PURSUANT TO THE
1992 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
This Non-Qualified Stock Option Agreement ("Agreement") is made and entered
into as of the __________, [1999] [2000] by and between Kennedy-Wilson, Inc., a
Delaware corporation (the "Company"), and ____________________ as optionee (the
"Optionee").
WHEREAS, Optionee is a non-employee director of the Company; and
WHEREAS, pursuant to the terms of the Company's 1992 Non-employee Director
Stock Option Plan (such plan as hereafter amended, subject to the terms hereof,
the "Plan"), the Board of Directors of the Company (the "Board") has approved
the grant to Optionee of a non-qualified option to purchase shares of the Common
Stock, par value. $ .01 per share, of the Company (the "Common Stock"), on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
covenants set forth herein, the parties hereto hereby agree as follows:
1. GRANT OF OPTION: CERTAIN TERMS AND CONDITIONS. The Company hereby grants
to Optionee, and Optionee hereby accepts, as of the Date of Grant indicated
below, an option (the "Option") to purchase the number of shares of Common Stock
indicated below (the "Option Shares") at the Exercise Price per share indicated
below, which Exercise Price shall not be less than the Fair Market Value (as
defined below) of the Option Shares on the Date of Grant. The Option shall
expire at 5:00 p.m., Los Angeles, California time, on the Expiration Date
indicated below and shall be subject to all of the terms and conditions set
forth in this Agreement. The option is not intended to qualify as an I incentive
stock option under Section 422 of the Internal Revenue Code.
Optionee:
Date of Grant:
Number of shares purchasable:
Exercise Price per share: $
Expiration Date:
Vesting Rate:
[Optionee acknowledges that shares of Common Stock are not currently
available under the Plan in respect of the Options granted hereunder. If the
Plan is not amended within one year after the date hereof to increase the number
of shares of Common Stock under the Plan so that such Options may be exercised,
the Options shall, without any further action on the part of the Company, be
canceled.]
2. TERMINATION OR EXPIRATION OF OPTION. The Option granted hereby shall
expire on the earlier of the Expiration Date listed above; or (b) ninety (90)
days after the date the Optionee ceases to be a Director of the Company.
3. ADJUSTMENT If the outstanding securities of the class then subject to
this Plan are increased, decreased, changed into or exchanged for a different
number or kind of shares of the Company through reorganization,
recapitalization, reclassification, stock dividend, stock split or reverse stock
split, upon proper authorization of the Board of Directors, an appropriate and
proportionate adjustment shall be made in (a) the number and type of shares or
other securities or cash or other property that may be acquired pursuant to
Options theretofore granted under this Plan and (b) the maximum number and type
of shares or other securities that may be issued pursuant to Options thereafter
granted under this Plan.
4. EXERCISE. Any vested and exercisable Option may be exercised by Optionee
by giving written notice, signed by Optionee, to the Company stating the number
of Common Shares with respect to which the Option is being exercised,
accompanied by payment in full of the aggregate Exercise Price in cash or by
check payable to the Company. No Option may be exercised with respect to any
fractional share, and cash shall be paid in lieu of fractional shares. As
promptly as practicable following the receipt of a notice hereunder, the Company
shall issue a stock certificate registered in the name of Optionee, representing
the number of Common Shares issued to Optionee upon exercise of the Option.
5. PAYMENT OF WITHHOLDING TAXES. If the Company is obligated to withhold an
amount on account of any Federal, state or local tax imposed as a result of the
exercise of the Option, including, without limitation, any Federal, state or
other income tax, or any F.I.C.A. state disability insurance tax or other
employment tax, then Optionee shall concurrently with such exercise, pay such
amount to the company in cash or by cashier's or certified bank check payable to
the Company.
6. NOTICES. Any notice given to the Company shall addressed to the Company
at 9601 Wilshire Blvd. Suite 220, Beverly Hills, California 90210, Attention:
General Counsel, or at such other address as the Company may hereinafter
designate in writing to Optionee. Any notice given to Optionee shall be sent to
the address set forth below Optionee's signature hereto, or at such other
address as Optionee may hereafter designate in writing to the Company. Any such
notice shall be deemed duly given when delivered personally or five (5) days
after mailing by prepaid certified or registered mail return receipt requested.
7. RESUME EXCHANGE REQUIREMENTS. Applicable Laws. Notwithstanding anything
to the contrary in this Agreement, no shares of stock purchased upon exercise of
the Option, and no certificate representing all or any part of such shares,
shall be issued or delivered if (a) such shares have not been admitted to
listing upon official notice of issuance on the NASDAQ National Market System or
each stock exchange upon which shares of that class are then listed or (b) in
the opinion of counsel to the Company, such issuance or delivery could cause the
Company to be in violation of or to incur liability under any Federal, state or
other securities law, or any requirement of any listing agreement to which the
Accompany is a party, or any other requirement of law or of any administrative
or regulatory body having jurisdiction lover the Company.
8. RESTRICTIONS ON TRANSFERABILITY.
(a) Neither the Option nor any interest therein may be sold, assigned,
conveyed, gifted, pledged, hypothecated pr otherwise transferred in any manner
other than by will pr the laws of descent and distribution.
(b) By accepting the Option, the Optionee for himself or herself and his or
her transferees by will or the laws of descent and distribution" represents and
a9rees that all shares of Common Stock purchased upon exercise of the Option
will be acquired and held in accordance with the restrictions of the Securities
Act of 1933, as amended, and shall not be further transferred except as
permitted by that act and the Rules and Regulations of the Securities and
Exchange Commission thereunder, that the Company may instruct its transfer agent
to restrict further transfer of said shares in its records except upon receipt
of satisfactory evidence that such restrictions have been satisfied, that upon
each exercise of any portion of the Option, the certificates evidencing the
purchased shares shall bear an !appropriate legend on the face thereof
evidencing such restrictions, and that the person entitled to exercise the same
shall furnish evidence satisfactory to the Company (including a written and
signed representation) to the effect !that the shares are being acquired subject
to such restrictions.
9. ISSUANCE PURSUANT TO THE PLAN. The Option is granted pursuant to the
Plan, as in effect on the Date of Grant, and subject to all the terms and
conditions of the Plan, as the same may be amended from time to time; provided,
however, that no such amendment shall deprive Optionee, without his or her
consent, of the Option or of any of Optiolj1ee's rights under this Agreement.
The interpretation and construction by the Board of the Plan, this Agreement,
the Option and such rules and regulations as may be adopted by the Board for the
purpose of administering the Plan shall be final and binding upon Optionee.
Until the Option shall expire, terminate or be exercised in full, the Company
shall, upon written request therefor, send a copy of the Plan, in its
then-current form, to Optionee or any other person or entity then entitled to
exercise the option.
10. STOCKHOLDER RIGHTS. No person or entity shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of any option Shares
until the Option shall have. Been duly exercised to purchase such Option Shares
in accordance with the Provisions of this Agreement.
11. DIRECTORSHIP RIGHTS. No provision of this Agreement or of the Option
granted hereunder shall confer upon Optionee: any right to continue as a
director of the Company or any of its subsidiaries.
12. GOVERNING LAW. This Agreement and the Option granted hereunder shall be
governed by and construed and enforced in accordance with the laws of the State
of Delaware.
IN WITNESS WHEREOF, the Company and Optionee have duly executed this
Agreement as of the Date of Grant.
KENNEDY-WILSON, INC. OPTIONEE
By: _________________________ _________________________________
Signature
Name: _________________________
Title: _________________________ _________________________________
Street Address
_________________________________
City, State & Zip Code
_________________________________
Social Security Number
