Stock Option Agreement - American Greetings Corp. and Morry Weiss
AMERICAN GREETINGS CORPORATION
Stock Option Agreement
1987 Class B Stock Option Plan
------------------------------
WHEREAS, MORRY WEISS (hereinafter called the
"Optionee") is President of American Greetings
Corporation, an Ohio corporation (the "Company"); and
WHEREAS, the execution of this Stock Option Agreement pursuant to the
Company's 1987 Class B Stock Option Plan has been duly authorized by a
resolution of the Board of Directors of the Company duly adopted on January 25,
1988;
NOW, THEREFORE, the Company hereby grants to the Optionee an option to
purchase 425,000 Class B Common Shares, par value $1 per share, of the Company
at the price of Fourteen and 5/16 Dollars ($14.3125) per share, and agrees to
cause certificates for any shares purchased hereunder to be delivered to the
Optionee upon payment of the purchase price in full, all subject, however, to
the terms and conditions hereinafter set forth.
1. This option (until terminated as hereinafter provided) shall be
exercisable only to the extent of one-quarter of the shares hereinabove
specified after the Optionee shall have been in the continuous employ of the
Company or any Subsidiary for one full year from the date hereof and to the
extent of an additional one-quarter of such shares after each of the next
three successive years thereafter during which the Optionee shall have been
in the continuous employ of the Company or any Subsidiary. If the Optionee
should retire at normal retirement age or at an early retirement age with the
consent of the Board of Directors, die or become permanently disabled after
having been in the continuous employ of the Company or any Subsidiary for a
period of at least ten years, this option shall, notwithstanding the preceding
sentence, immediately become exercisable in full. For the purposes of this
paragraph, leaves of absence approved by the Board of Directors or Stock
Option Committee of the Company for illness, military or governmental service,
or other cause, shall be considered as employment. To the extent exercisable,
this option may be exercised in whole or in part from time to time.
2. This Option shall terminate on the earliest of the following dates:
(A) On the date on which the Optionee ceases to be an employee of
the Company or a Subsidiary, unless he ceases to be such employee by reason
of retirement as described in Section (1) above, death or permanent disability
or in a manner described in (B) below;
<PAGE>
(B) Three months after the Optionee ceases to be an employee of
the Company or a Subsidiary by reason of termination of employment under
circumstances determined by the Board of Directors to be for the convenience
of the Company;
(C) One year after the death or permanent disability of the
Optionee if the Optionee dies or becomes permanently disabled while an
employee of the Company or a subsidiary or within the three-month period
referred to in (B) above;
(D) Ten years and three months from the date on which this option
was granted.
Nothing contained in this Stock Option Agreement shall limit
whatever the right the Company or a Subsidiary might otherwise
have to terminate the employment of the Optionee.
3. This option is not transferable by the Optionee otherwise than by
will or the laws of descent and distribution, and is exercisable, during the
lifetime of the Optionee, only by him or his legal representative. The
purchase price payable upon exercise of this option may, at the election of
the Optionee, be paid (a) in cash or by check acceptable to the Company; (b)
if specifically approved at or prior to the time of exercise by the Board of
Directors, by the transfer to the Company by the Optionee of Class A or Class
B Common Shares of the Company that have been owned by him for at least six
months and have a value at the time of exercise equal to the total option
price or (c) by a combination of such methods of payment.
4. This option shall not be exercisable if such exercise would involve
a violation of any applicable federal or state securities law, and the Company
hereby agrees to make reasonable efforts to comply with such securities laws.
If the Ohio Securities Act shall be applicable to this option, it shall not be
exercisable unless under such Act at the time of exercise the Class B Common
Shares or other securities purchasable hereunder are exempt, are the subject
matter of an exempt transaction, are registered by description or by
qualification, or at such time are the subject matter of a transaction which
has been registered by description.
5. The Board of Directors shall make such adjustments in the option
price and in the number or kind of Class B Common Shares or other securities
covered by this option as such Board in its sole discretion, exercised in good
faith, may determine is equitably required to prevent dilution or enlargement
of the rights of the Optionee that otherwise would result from (a) any stock
dividend, stock split, combination of shares, recapitalization or other
changes in the capital structure of the Company, or (b) any merger,
consolidation, separation, reorganization, partial or complete liquidation,
issuance of rights or warrants to purchase stock, or (c) any other corporate
transaction or event having an effect similar to any of the foregoing.
<PAGE>
EXECUTED at Cleveland, Ohio as of the 25th day of January, 1988.
AMERICAN GREETINGS CORPORATION
By /s/ Henry Lowenthal
----------------------------------
Title: Senior Vice President
and Chief Financial Officer
The undersigned Optionee hereby acknowledges receipt of an executed
original of this Stock Option Agreement and accepts the option granted
thereunder.
The Optionee acknowledges that he has been advised that the Class B
Common Shares covered by such Agreement have not been registered under the
Securities Act of 1933 and agrees that he will not make any disposition of
such shares unless either (a) such shares have been registered under such Act
or (b) an exemption from the registration provisions of such Act is applicable
to the Optionee's proposed disposition of such shares. The Optionee
understands that the certificates for such shares may bear a legend
substantially as follows:
The shares evidenced by this Certificate have not been
registered under the Securities Act of 1933. Such shares may
not be sold or otherwise transferred until the same have been
registered under such Act or until the Company shall have
received an opinion of legal counsel or a copy of a letter
from the Staff of the Division of Corporation Finance of the
Securities and Exchange Commission, in either case
satisfactory to the Company, that such shares may legally be
sold or otherwise transferred without such registration."
/s/ Morry Weiss
---------------------------