Exhibit 10.2

 

Stock Option Grant

Staples, Inc.

 

Employer ID: 04-2896127

 

500 Staples Drive

 

Framingham, MA 01702

 

 

 

ACCOUNT ID:

 

«AccountID»

«FirstName» «MiddleName» «LastName»

 

LOCATION:

 

«ExtraField2»

«Address1»

 

 

 

 

«Address2»

 

 

 

 

«Address3»

 

 

 

 

«City», «State» «Zip»

 

 

 

 

«Country»

 

 

 

 

 

You have been granted an option to purchase Staples, Inc. Common Stock as
follows:

 

Type of Option:

Non-Qualified Stock Option

Grant No.:

«GrantNumber»

Stock Option Plan:

2004

Date of Grant:

«GrantDate»

Total Number of Option Shares:

«SharesGranted»

Option Price per Share:

US$«OptionPrice»

Total Exercise Price of Option Shares:

US$«TotalOptionPrice»

 

Vesting Date

 

Number of Shares
Vesting on Vesting Date

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By your acceptance of this Stock Option Grant, you agree that this option is
granted under and governed by the terms and conditions of Staples, Inc.’s 2004
Stock Incentive Plan (as amended from time to time) and by the terms and
conditions of Staples, Inc.’s Non-Qualified Stock Option Agreement ( NQS42004),
which is attached hereto.

 

You understand and agree that this Stock Option Grant is being awarded to you in
exchange for your execution of a Non-Compete and Non-Solicitation Agreement in a
form approved by Staples.

 

Staples, Inc.

 

 

Ronald L. Sargent

President and Chief Executive Officer

 

Attachment: Staples, Inc. Non-Qualified Stock Option Agreement

 

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STAPLES, INC. NON-QUALIFIED STOCK OPTION AGREEMENT

 

1.              Grant of Option. Staples, Inc., a Delaware corporation
(“Staples”), hereby grants to the Optionee named in the accompanying Stock
Option Grant (the “Option Grant”) the option, pursuant to Staples’ 2004 Stock
Incentive Plan noted in the Option Grant (the “Plan”), to purchase an aggregate
of the Total Number of Option Shares of Common Stock of Staples stated in the
Option Grant at a price per share equal to the Option Price per Share stated in
the Option Grant, purchasable as set forth in and subject to the terms and
conditions of this Option Agreement and the Plan. Except where the context
otherwise requires, the term “Staples” shall include the parent and all present
and future subsidiaries of Staples as defined in Sections 424(e) and 424(f) of
the Internal Revenue Code of 1986, as amended or replaced from time to time (the
“Code”).

 

2.              Non-Qualified Stock Option. This option is not intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.

 

3.              Exercise of Option and Provisions for Termination.

 

(a)  Vesting Schedule.  Except as otherwise provided in this Agreement, this
option may be exercised up to and including the tenth anniversary of the Date of
Grant stated in the Option Grant (hereinafter the “Expiration Date”).  This
option shall become exercisable (or “vest”) in installments for the number of
shares set forth in the table in the Option Grant commencing on each of the
respective Vesting Dates noted (each a “Vesting Date”).  The right of exercise
shall be cumulative so that if the option is not exercised to the maximum extent
permissible during any exercise period, it shall be exercisable, in whole or in
part, with respect to all shares not so purchased at any time prior to the
Expiration Date or the earlier termination of this option.  This option may not
be exercised at any time after the Expiration Date.

 

(b)  Exercise Procedure.  Subject to the conditions set forth in this Agreement,
this option shall be exercised by the Optionee’s delivery of written notice of
exercise to the Secretary of Staples, specifying the Date of Grant of this
Option Agreement, the number of shares to be purchased and the purchase price to
be paid therefor, and accompanied by payment in full in accordance with
Section 4.  Such exercise shall be effective upon receipt by the Secretary of
Staples of such written notice together with the required payment.  The Optionee
may purchase less than the number of shares covered hereby, provided that no
partial exercise of this option may be for any fractional share.

 

(c)  Continuous Relationship with Staples Required.  Except as otherwise
provided in this Section 3, this option may not be exercised unless the
Optionee, at the time he or she exercises this option, is, and has been at all
times since the Date of Grant of this option, an employee or director of, or a
consultant, advisor or service provider to, Staples (an “Eligible Optionee”).

 

(d)  Termination of Relationship with Staples.  If the Optionee ceases to be an
Eligible Optionee for any reason, then, except as provided in this paragraph (d)
and in paragraphs (e) and (f) below, the right to exercise this option shall
terminate six (6) months after such cessation (but in no event after the
Expiration Date), provided that this option shall be exercisable only to the
extent that the Optionee was entitled to exercise this option on the date of
such cessation.  Notwithstanding the foregoing sentence or the vesting
schedule set forth in Section 3(a) above, if the Optionee terminates employment
after attaining age 55 and if at the time of such termination of employment the
sum of the years of service (as determined by the Board of Directors of Staples)
completed by the Optionee plus the Optionee’s age is greater than or equal to
65, this option shall be exercisable for the Total Number of Option Shares for a
period of three (3) years after the date of the Optionee’s termination (but in
no event after the Expiration Date).  In addition, if the Optionee is an
employee on an approved leave of absence, then this option shall not terminate
as a result of such leave of absence unless and until the Optionee’s employment
relationship is ultimately terminated.  If the Optionee ceases to be an Eligible
Optionee under circumstances where paragraph (f) below does not apply,  and the
Optionee becomes an Eligible Optionee within six (6) months after he or she
ceased to be an Eligible Optionee, then this option shall not terminate and
shall be reinstated.

 

(e)  Exercise Period Upon Death or Disability.  If the Optionee dies or becomes
disabled (within the meaning of Section 22(e)(3) of the Code) prior to the
Expiration Date while he or she is an Eligible Optionee, or if the Optionee dies
within six (6) months after the Optionee ceases to be an Eligible Optionee
(other than as the result of a termination of such relationship by Staples for
“cause” as specified in paragraph (f) below), this option (i) shall be
exercisable, within the period of 12 months following the date of death or
disability of the Optionee  (but in no event after the Expiration Date), by the
Optionee or by the person to whom this option is transferred by will or the laws
of descent and distribution, and (ii) notwithstanding the vesting schedule set
forth in Section 3(a) above, shall be exercisable for 100% of the Total Number
of Option Shares.  Except as otherwise indicated by the context, the term
“Optionee,” as used in this option, shall be deemed to include the estate of the
Optionee or any person who acquires the right to exercise this option by bequest
or inheritance or otherwise by reason of the death of the Optionee.

 

(f)  Termination for Cause.  If (a) the Optionee’s relationship with Staples is
terminated by Staples for “cause” (as defined below), or (b) if the Optionee
retires or resigns and Staples determines within six months thereafter that the
Optionee’s conduct prior to his or her retirement or resignation warranted a
discharge for “cause,” or (c) Staples determines that the Optionee’s conduct
after termination of the employment or consulting relationship fails to comply
with the terms of any non-competition, non-solicitation or confidentiality
provision contained in any employment, consulting, advisory, proprietary
information, non-disclosure, non-competition, non-solicitation or other similar
agreement between the Optionee and Staples, then (x) the right to exercise this
option with respect to any shares not previously exercised shall terminate
immediately, and (y) without limiting any other remedy available to Staples,
Staples shall be entitled to repurchase from the Optionee at the Exercise Price
the shares of Common Stock previously purchased

 

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by the Optionee hereunder, or, if the Optionee at such time no longer owns such
shares, Staples shall be entitled to recover from the Optionee the gross profit
earned by the Optionee upon the purchase and disposition (whether by sale, gift,
donation or otherwise) of such shares.

 

“Cause,” as determined by Staples (which determination shall be conclusive),
shall mean:

 

(i) willful failure by the Optionee to substantially perform his or her duties
with Staples (other than any failure resulting from incapacity due to physical
or mental illness).  No act or failure to act on the Optionee’s part will be
deemed “willful” unless the Optionee acted or failed to act without a good faith
or reasonable belief that his or her conduct was in Staples’ best interest; or

 

(ii) breach by the Optionee of any provision of any employment, consulting,
advisory, proprietary information, non-disclosure, non-competition,
non-solicitation or other similar agreement between the Optionee and Staples,
including, without limitation, the Proprietary and Confidential Information
Agreement and/or the Non-Compete and Non-Solicitation Agreement; or

 

(iii) violation by the Optionee of the Code of Ethics or an attempt by the
Optionee to secure any improper personal profit in connection with the business
of Staples; or

 

(iv) failure by the Optionee to devote his or her full working time to the
affairs of Staples except as may be authorized in writing by Staples’ CEO or
other authorized Company official; or

 

(v) the Optionee’s engagement in business other than the business of Staples
except as may be authorized in writing by Staples’ CEO or other authorized
Company official; or

 

(vi) the Optionee’s engagement in misconduct which is demonstrably and
materially injurious to Staples.

 

4.              Payment of Purchase Price.

 

(a)  Method of Payment.  Payment of the purchase price for shares purchased upon
exercise of this option shall be made (i) by delivery to Staples of cash or a
check to the order of Staples in an amount equal to the purchase price of such
shares, (ii) subject to the consent of Staples, by delivery to Staples of shares
of Common Stock of Staples then owned by the Optionee having a fair market value
equal in amount to the purchase price of such shares, (iii) by any other means
which the Board of Directors determines are consistent with the purpose of the
Plan and with applicable laws and regulations (including, without limitation,
the provisions of Rule 16b-3 under the Securities Exchange Act of 1934 and
Regulation T promulgated by the Federal Reserve Board), or (iv) by any
combination of such methods of payment. Notwithstanding the prior sentence,
under no circumstance may payment for shares be made by a promissory note.

 

(b)  Valuation of Shares or Other Non-Cash Consideration Tendered in Payment of
Purchase Price.  For the purposes hereof, the fair market value of any share of
Staples’ Common Stock or other non-cash consideration which may be delivered to
Staples in exercise of this option shall be determined in good faith by the
Board of Directors of Staples.

 

(c)  Delivery of Shares Tendered in Payment of Purchase Price.  If the Optionee
exercises this option by delivery of shares of Common Stock of Staples, the
certificate or certificates representing the shares of Common Stock of Staples
to be delivered shall be duly executed in blank by the Optionee or shall be
accompanied by a stock power duly executed in blank suitable for purposes of
transferring such shares to Staples, and the Common Stock delivered may not be
subject to any repurchase, forfeiture, unfulfilled vesting or other similar
requirement and must have been held for at least six months if such Common Stock
was previously issued to the Optionee through a Staples compensation plan. 
Fractional shares of Common Stock of Staples will not be accepted in payment of
the purchase price of shares acquired upon exercise of this option.

 

5.              Delivery of Shares; Compliance With Securities Laws, Etc.

 

(a)  General.  Staples shall, upon payment of the option price for the number of
shares purchased and paid for, make prompt delivery of such shares to the
Optionee, provided that if any law or regulation requires Staples to take any
action with respect to such shares before the issuance thereof, then the date of
delivery of such shares shall be extended for the period necessary to complete
such action.

 

(b)  Listing, Qualification, Etc.  This option shall be subject to the
requirement that if, at any time, counsel to Staples shall determine that the
listing, registration or qualification of the shares subject hereto upon any
securities exchange or under any state or federal law, or the consent or
approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
hereunder, this option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, disclosure or
satisfaction of such other condition shall have been effected or obtained on
terms acceptable to the Board of Directors.  Nothing herein shall be deemed to
require Staples to apply for, effect or obtain such listing, registration,
qualification or disclosure, or to satisfy such other condition.

 

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6.              Transferability of Option.  This option is personal and no
rights granted hereunder may be transferred, assigned, pledged or hypothecated
in any way (whether by operation of law or otherwise) nor shall any such rights
be subject to execution, attachment or similar process, except that this option
may be transferred by will or the laws of descent and distribution or, upon
notice to Staples, for estate planning purposes to entities that are
beneficially owned entirely by family members.  All transferees of this option
must agree to be governed by all of the terms and conditions of this Agreement. 
Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose
of this option or of such rights contrary to the provisions hereof, or upon the
levy of any attachment or similar process upon this option or such rights, this
option and such rights shall, at the election of Staples, become null and void.

 

7.              No Special Employment or Similar Rights.  Nothing contained in
the Plan or this option shall be construed or deemed by any person under any
circumstances to bind Staples to continue the employment or other relationship
of the Optionee with Staples for the period within which this option may be
exercised.

 

8.              Rights as a Shareholder.  The Optionee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to receive dividends or
non-cash distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee.  No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.

 

9.              Adjustment Provisions.

 

(a)  General.  In the event of any recapitalization, reclassification of shares,
combination of shares, stock dividend, stock split, reverse stock split,
spin-off or other similar change in capitalization or event or any distribution
to holders of Common Stock other than an ordinary cash dividend, the Optionee
shall, with respect to this option or any unexercised portion hereof, be
entitled to the rights and benefits, and be subject to the limitations, set
forth in Section 9(a) of the Plan.

 

(b)  Board Authority to Make Adjustments.  Any adjustments under this Section 9
will be made by the Board of Directors, whose determination as to what
adjustments, if any, will be made and the extent thereof will be final, binding
and conclusive.  No fractional shares will be issued pursuant to this option on
account of any such adjustments.

 

10.       Mergers, Consolidations, Distributions, Liquidations, Etc.  In the
event of a merger or consolidation or any share exchange transaction in which
outstanding shares of Common Stock are exchanged for securities, cash or other
property of any other corporation or business entity, or in the event of a
liquidation of Staples, prior to the Expiration Date or termination of this
option, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Section 9 of the Plan.

 

11.       Exercisability and Vesting Following a Change in Control.

 

(a)  Definitions.  For purposes of this Agreement, the following terms shall
have the following meanings:

 

(i)  A “Change in Control” shall be deemed to have occurred if (A) any “person”,
as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act
of 1934 (the “Exchange Act”) (other than Staples, any trustee or other fiduciary
holding securities under an employee benefit plan of Staples, or any corporation
owned directly or indirectly by the stockholders of Staples in substantially the
same proportion as their ownership of stock of Staples), is or becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of Staples representing 30% or more of the combined
voting power of Staples’ then outstanding securities(other than pursuant to a
merger or consolidation described in clause (1) or (2) of subsection (C) below);
(B) individuals who, as of the date hereof, constitute the Board of Directors of
Staples (as of the date hereof, the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board of Directors, provided that any
person becoming a director subsequent to the date hereof whose election, or
nomination for election by Staples’ stockholders, was approved by a vote of at
least a majority of the directors then comprising the Incumbent Board (other
than an election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election contest relating
to the election of the directors of Staples, as such terms are used in Rule
14a-11 of Regulation 14A under the Exchange Act) shall be, for purposes of this
Agreement, considered as though such person were a member of the Incumbent
Board; (C) the stockholders of Staples approve a merger or consolidation of
Staples with any other corporation, other than (1) a merger or consolidation
which would result in the voting securities of Staples outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) more than 75% of
the combined voting power of the voting securities of Staples or such surviving
entity outstanding immediately after such merger or consolidation, or (2) a
merger or consolidation effected to implement a recapitalization of Staples (or
similar transaction) in which no “person” (as defined above) acquires more than
30% of the combined voting power of Staples’ then outstanding securities; or (D)
the stockholders of Staples approve an agreement for the sale or disposition by
Staples of all or substantially all of Staples’ assets.

 

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(ii) “Surviving Corporation” shall mean (x) in the case of a Change in Control
pursuant to clause (A) or clause (B) of Section 11(a)(i), Staples; (y) in the
case of a Change in Control pursuant to clause (C) of Section 11(a)(i), the
surviving or resulting corporation in such merger or consolidation; and (z) in
the case of a Change in Control pursuant to Clause (D) of Section 11(a)(i), the
entity acquiring the majority of the assets being sold or disposed of by
Staples.

 

(b)  Effect of Change in Control.  Notwithstanding the provisions of
Section 3(a), if a Change in Control of Staples occurs, this option shall become
exercisable for additional shares of Common Stock as follows:

 

(i)  If, upon the Change in Control, the Optionee

 

(A) is offered employment with the Surviving Corporation (or is allowed to
continue his or her employment, if the Surviving Corporation is Staples) in a
position (1) in which the title, employment duties and responsibilities,
conditions of employment, and the level of compensation and benefits are at
least equivalent to those in effect during the 90-day period immediately
preceding the Change in Control and (2) that does not involve a relocation of
the Optionee’s principal place of employment of more than 30 miles, or

 

(B) accepts (or elects to continue) employment with the Surviving Corporation
(regardless of position, compensation or location),

 

then (x) effective immediately prior to the Change in Control, the vesting
schedule of this option stated in Section 3(a) above shall accelerate such that
an additional 25% of the Total Number of Option Shares shall become immediately
exerciseable, and (y) on each Vesting Date which had not yet occurred as of the
date of the Change in Control, this option shall become exercisable for such
number of additional shares of Common Stock as is determined by dividing the
balance of the Total Number of Option Shares remaining unvested following the
acceleration of vesting referred to in clause (x) above, by the number of
Vesting Dates which had not occurred as of the date of the Change in Control.

 

(ii)  If, upon the Change in Control,

 

(A) the Optionee is either offered employment in accordance with clause (A) of
Section 11(b)(i) or accepts employment in accordance with clause (B) of
Section 11(b)(i), and

 

(B) within one year following the date of the Change in Control, the Optionee
either (1) is discharged without cause (as defined in Section 3(f)) or (2)
resigns because his or her title or employment duties and responsibilities are
diminished, his or her conditions of employment are adversely changed, the level
of his or her compensation and benefits are reduced, or his or her principal
place of employment is relocated by more than 30 miles,

 

then the vesting of this option shall be accelerated such that this option shall
become exercisable in full effective upon the date of such discharge or
resignation (and this option shall remain exercisable following such discharge
or resignation for such period, if any, as is provided in Section 3).

 

(iii) If the Optionee is not offered employment in accordance with clause (A) of
Section 11(b)(i) and does not accept employment in accordance with clause (B) of
Section 11(b)(i), then the vesting of this option shall be accelerated such that
this option shall become exercisable in full effective immediately prior to the
Change in Control.

 

12.       Withholding Taxes.  Staples’ obligation to deliver shares upon the
exercise of this option shall be subject to the Optionee’s satisfaction of all
applicable federal, state and local income and employment tax withholding
requirements.

 

13.       Miscellaneous.

 

(a)  Except as provided herein, this option may not be amended or otherwise
modified unless evidenced in writing and signed by Staples and the Optionee
unless the Board of Directors of Staples determines that the amendment or
modification, taking into account any related action, would not materially and
adversely affect the Optionee.  However, in no event may this Option be
converted into a stock appreciation right.  This Option Agreement may be
executed in multiple counterparts, each of which shall represent the same option
agreement.

 

(b)  All notices under this option shall be mailed or delivered by hand to
Staples at its main office, Attn: Secretary, and to the Optionee to his or her
last known address on the employment records of Staples or at such other address
as may be designated in writing by either of the parties to one another.

 

(c)  This option shall be governed by and construed in accordance with the laws
of the State of Delaware.

 

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