Exhibit 10.7

 

STOCK OPTION AGREEMENT

Pursuant to

 

CHRISTOPHER & BANKS CORP.

 

1997 Stock Incentive Plan

(Qualified Stock Option)

 

Name of Employee:

 

Date of Grant:

 

Number of Shares:

 

Exercise Price Per Share:

 

This STOCK OPTION AGREEMENT (the “Agreement”) made as of
                             between Christopher & Banks Corp. (the “Company”)
and the above-named individual, an employee of the Company or one of its
subsidiaries (the “Employee”), to record the granting of an option pursuant to
the Company’s 1997 Stock Incentive Plan (the “Plan”).  Except as otherwise
defined herein, capitalized terms contained in this Agreement shall have the
same meaning as set forth in the Plan.

 

1.             Grant of Option:  In accordance with Plan, the Company hereby
grants to the Employee, subject to the terms and conditions of the Plan and this
Agreement, the option to purchase from the Company an aggregate of
                             shares of Common Stock  ($.01 par value) of the
Company at the purchase price of $                             per share, such
adoption to be exercisable as hereinafter provided.

 

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2.             Expiration Date:  This option shall expire on
                             (the “Expiration Date”).

 

3.             Exercise of Option:  Subject to Section 8 hereof, this option
shall become exercisable with respect to      % of the shares of Common Stock
subject hereto on the first anniversary date of the grant of this option
(       ), and with respect to an additional          % of such shares on each
of the                              anniversary dates of the grant of this
option.

 

This option may be partially exercised from time to time within such percentage
limitations.  This option may not be exercised after the Expiration Date.
Notwithstanding the foregoing, this option shall not be exercisable for a
fractional share of stock. Any exercise of this option shall be made in writing
duly executed and delivered to the Company specifying the number of shares as to
which the option is being exercised in the form of the Subscription Form for
Exercise attached hereto. Schedule I of this Agreement shall be made available
to the Company at the time of exercise for notation of any partial exercise.

 

4.             Payment of Option Price:  On the date of any exercise of this
option, the purchase price of the shares as to which this option is being
exercised shall be due and payable and shall be made in cash or by check or by
delivery of shares of common stock of the Company held by the optionee for more
than six (6) months and registered in the name of the Employee, duly assigned to
the Company with the assignment guaranteed by a bank, trust company or member
firm  of the New York Stock Exchange, and with all necessary transfer tax stamps
affixed, or by a combination of the foregoing, any such

 

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shares so delivered to be deemed to have a value per share equal to the fair
market value of the shares on such date, as determined by the Committee.

 

5.             Option Nontransferable:  This option is not transferable
otherwise than by will or the law or descent or distribution and is exercisable
during the Employee’s lifetime only by the Employee or his guardian or legal
representative.

 

6.             Rights as a Shareholder:  The Employee shall have no rights as a
shareholder with respect to any of the shares covered by this option until the
date of issuance to the Employee of a stock certificate for such shares, and no
adjustment shall be made for any dividends or other rights if the record date of
such dividends or other rights is prior to the date such stock certificate is
issued.

 

7.             General Restrictions:

 

(1)          At the time of any exercise of this option, the Employee shall
furnish the Company with a representation that he is acquiring the shares issued
upon such exercise as an investment and not with a view to, or for sale in
connection with, the distribution of any such shares; provided, however, that
such representation need not be furnished in the event the shares issued upon
such exercise are registered with the Securities and Exchange Commission under
the Securities Act of 1933, as amended.

 

(2)          The Company will not be obligated to issue shares of Common Stock
covered by this option if counsel to the Company determines that such issuance
would violate any law or regulation of any governmental authority or any
agreement between the Company and the New York Stock Exchange or any national
securities exchange upon which the Common Stock is

 

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quoted or listed. In connection with any issuance or transfer, the person
acquiring the shares shall, if requested by the Company, give assurances
satisfactory to counsel to the Company regarding such matters as the Company may
deem desirable to assure compliance with all legal requirements. This option
shall be subject to the requirement that if at any time the Committee shall
determine, in its discretion, that the listing, registration or qualification of
the shares subject to this option upon the New York Stock Exchange, any
securities exchange or under any state or federal law, or that the consent or
approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, this option or the issue or purchase of
shares under this option, this option shall be subject to the condition that
such listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Committee.

 

(3)          Certificates evidencing shares of Common Stock issued pursuant to
this   Agreement shall bear a legend describing restrictions on transfer thereof
unless the Company determines that such legend is not necessary or appropriate.

 

8.             Termination of Employment:

 

(1)            The option granted pursuant to this Agreement shall terminate
immediately upon the termination of the Employee’s employment by the Company or
any subsidiary for any reason whatsoever; provided, however, that in the event
such termination of employment results from (i)

 

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the Employee’s retirement with the consent of the Company, such option may be
exercised within three months of the date of termination and (ii) the Employee’s
disability (as defined in Section 105(d)(4) of the Internal Revenue Code of
1986, as amended) or death, such option may be exercised by the Employee’s legal
representative, heir or devisee, as appropriate within one year from the date of
disability or death. Notwithstanding clause (i) of the preceding sentence, the
Company may terminate and cancel such option during the three-month period
referred to in such clause if the optionee engages in employment or activities
contrary, in the opinion of the Company’s Board of Directors or the Committee,
to the best interests of the Company or any subsidiary. In addition, the
Committee shall, in each case in which clause (i) of the second preceding
sentence may be applicable, determine whether a termination of employment shall
be considered retirement with the consent of the Company. Notwithstanding the
foregoing, (i) the option granted pursuant to this Agreement shall not be
exercisable after the expiration date of such option and (ii) such option (or
any portion thereof) which is not exercisable on the date of termination of
employment shall not be exercisable thereafter without the consent of the
Committee.

 

(2)            Nothing contained in this Section shall be interpreted or have
the effect of extending the period during which an option may be exercised
beyond the terms or the Expiration Date provided in this Agreement or
established by law or regulation. Death of the Employee subsequent to
termination shall

 

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not extend such periods. Whether leave of absence shall constitute a termination
of employment for purposes of this Agreement shall be determined by the
Committee in its sole discretion.

 

9.             Adjustment of Shares:

 

(1)            In the event there is any recapitalization in the form of a stock
dividend, distribution, split, subdivision or combination of shares of Common
Stock of the Company, resulting in an increase or decease in the number of
shares of Common Stock outstanding, the number of shares of Common Stock covered
by this option and the exercise price per share under this option shall be
increased or decreased proportionately, as the case may be, without change in
the aggregate exercise price.

 

(2)            If, pursuant to any reorganization, sale or exchange of assets,
consolidation or merger, outstanding Common Stock of the Company is or would be
exchanged for other securities of the Company or of another corporation which is
a party to such transaction, or for property, this option shall apply to the
securities or property into which the Common Stock covered hereby would have
been changed or for which such Common Stock would have been exchanged had such
Common Stock been outstanding at the time.

 

10.           No Employment Rights:  Neither the Plan nor this option shall
confer upon the Employee any right with respect to continuance of employment by
the Company or any subsidiary nor shall they interfere in any way with the right
of the Company or any

 

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subsidiary by which the Employee is employed to terminate the employment of the
Employee at any time, with or without cause.

 

11.           Plan Controls:  The Employee hereby acknowledges receipt of a copy
of the Plan and agrees to be bound by all of the terms and provisions thereof
including any which may conflict with those contained in this Agreement. The
Plan is hereby incorporated by reference into this Agreement, and this Agreement
is subject in all respect to the terms and conditions of the Plan. In the event
of any conflict between this Agreement and the Plan, the terms of the Plan shall
control. This option is intended to qualify as an incentive stock option under
Section 422 of the Internal Revenue Code of 1986, as amended, and this Agreement
and the Plan are to be construed accordingly.

 

12.           Notices:  All notices to the Company shall be in writing and sent
by certified or registered mail, postage prepaid, to the Company at its offices
at 2400 Xenium Lane North, Plymouth, Minnesota 55441 or such other address as
the Company shall from time to time notify the Employee in writing. All notices
to the Employee shall be in writing and sent by certified or registered mail,
postage prepaid, to the Employee at the address set forth on the signature
page(s) hereof or such address as the Employee shall from time to time notify
the Company in writing. All notices shall be deemed to have been given when
mailed.

 

13.           Conflicts:  As a condition to the granting of the option contained
herein, the Employee agrees that any dispute or disagreement with respect to the
Plan, this Agreement or such option shall be determined by the Committee in its
sole discretion, and that any interpretation by the Committee of the terms of
this Agreement shall be final, binding and conclusive. In the event of the
institution of any legal proceedings directed to

 

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the validity of the Plan, or to any option granted under the Plan, the Company
may, in its discretion and without incurring any liability to the Employee
terminate this Agreement and/or the option granted pursuant to this Agreement.

 

14.           Tax Treatment:  In the event the Employee seeks to qualify for the
special capital gains treatment available for the Plan, the Employee must not
dispose of any of the shares underlying the option within two (2) years
following the date the option is granted or within one (1) year of the exercise
and transfer of the shares to the Employee. Due to the complex nature of the tax
laws, the Employee is urged to consult his personal tax advisor prior to
exercising the option. THE CORPORATION MAKES NO WARRANTIES OR REPRESENTATIONS
WHATSOEVER TO THE EMPLOYEE REGARDING THE TAX CONSEQUENCES OF THIS GRANT, THE
EXERCISE OF ANY OPTIONS OR ANY OTHER MATTER.

 

IN WITNESS WHEREOF, the Company and the Employee has caused this Stock Option
Agreement to be executed on the date set forth opposite the respective
signatures. It is being further understood that the Date of Grant may differ
from the date of signature.

 

Dated as of :

 

 

 

Christopher & Banks Corp.

 

 

 

 

 

By:

 

 

 

 

 

 

Its:

 

 

 

 

Dated as of:

 

 

 

Employee

 

 

 

 

 

 

 

 

 

 

 

Address:

 

 

 

 

 

 

 

 

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SCHEDULE I

 

Date of
Exercise

 

No. of Shares
Purchased

 

Balance of
Option Shares

 

Authorized
Signature

 

Notation
Date

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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SUBSCRIPTION FORM FOR EXERCISE

 

(To be executed by the holder desiring to

exercise the right to purchase shares

subject to the within option)

 

The undersigned hereby irrevocable elects to exercise the right to purchase
represented by the within option for, and to purchase thereunder,
                               shares of Common Stock, $.01 par value per share,
of CHRISTOPHER & BANKS CORP., a Delaware corporation (the “Company”), as
provided therein and herewith makes payment of the purchase price in full and
requests that certificates for such securities be issued in the name of:

 

 

 

 

 

Name (Please print in block letters)

 

 

 

 

 

 

 

 

Street

 

 

 

 

 

 

 

 

City

State

Zip

 

 

 

 

 

 

(Please insert Social Security or other identifying number)

 

 

and, if said number of shares shall not be all of the shares issuable
thereunder, that any partial exercise of the within option shall be noted in
Schedule I thereof which is delivered herewith.

 

 

Date:

 

 

 

 

 

Signature

 

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