**EXHIBIT10.15.1**

 

FORM OFSTOCK OPTION AGREEMENT

 

THIS STOCK OPTION AGREEMENT (the “Agreement”), datedthis ______ day of ______________, ______, by and between Arden Group, Inc., aDelaware corporation (the “Company”), and _____________________ (the “OptionHolder”), is made with reference to the following facts:

 

A.                                   TheCompany is desirous of providing additional incentives to the Option Holder inrendering services to and on behalf of the Company and, in order to accomplishthis result, has determined to grant the Option Holder the right and option topurchase shares of the Class A Common Stock, $.25 par value per share, of theCompany pursuant to the Company’s Non-Officer and Non-Director Stock OptionPlan (the “Plan”) on the terms and conditions set forth herein.

 

B.                                     TheOption Holder is desirous of accepting said stock option on the terms andconditions set forth herein.

 

NOW, THEREFORE, it is agreed as follows:

 

1.                                       Grant.  The Company grants to the Option Holder theright and option to purchase, on the terms and conditions hereinafter set forth(the “Option”), all or any part of an aggregate of _____________________(____________) shares of the Class A Common Stock, $.25 par value per share, ofthe Company (the “Class A Common Stock”) at a purchase price of_________________ Dollars ($______) per share, exercisable from time to time inaccordance with the provisions of this Agreement and the Plan during a periodcommencing on the date hereof and expiring at the close of business on the datewhich is five years from the date of grant of this Option (the date of grantbeing the date hereof) (the “Expiration Date”).  This Option will not be treated as an “incentive stock option” asdefined in Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”),or any regulations promulgated thereunder.

 

2.                                       Exerciseof Option.

 

(a)                                  TheOption Holder may exercise any then exercisable portion of this Option bydelivering or mailing to the Company, Attention: Chief Financial Officer, anotice of exercise, in the form prescribed by the Company, specifying thereinthe number of shares of Class A Common Stock he has elected to purchase,accompanied by (i) payment (A) in cash or by check payable to the order of theCompany for the purchase price per share multiplied by the number of shares tobe purchased (the “Aggregate Purchase Price”) or (B) in whole or in part bydelivery by the Option Holder of shares of previously acquired Class A CommonStock having a Fair Market Value (determined as of the date of such exercise ofthis Option) equal to all or part of the Aggregate Purchase Price and, if andto the extent applicable, cash or a check made payable to the Company for anyremaining portion of the Aggregate Exercise Price and (ii) if required, theletter described in Paragraph 7.  Nopartial exercise of this Option may be for less

 

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than One Hundred (100) shares and in no event shallthe Company be required to issue fractional shares.  The exercise of this Option shall not be deemed effective unlessand until the Option Holder has complied with all of the provisions of thisParagraph 2(a).  For purposes of thisOption, “Fair Market Value” shall mean (i) if the Class A Common Stock is thenlisted on a national securities exchange, the closing sales price of the ClassA Common Stock on the day such value is determined on the principal securitiesexchange on which such stock is then listed, or if there is no reported sale onthat day, the average of the bid and asked quotations on such exchange on thatday, or (ii) if the Class A Common Stock is then publicly traded in the NASDAQNational Market System, the closing sales price of the Class A Common Stock asreported by the NASDAQ National Market System on the day such value isdetermined, or if there is no reported sale on that day, the average of the bidand asked quotations on that day, or (iii) if the Class A Common Stock is thenpublicly traded in the over-the-counter market (other than the NASDAQ NationalMarket System), the mean between the closing bid and asked prices of the ClassA Common Stock in the over-the-counter market on the day such value isdetermined or, if no shares were traded that day, on the next preceding day onwhich there was such a trade, or (iv) if the Class A Common Stock is not thenseparately quoted or publicly traded, the fair market value on the date suchvalue is to be determined, as determined in good faith by the CompensationCommittee of the Board of Directors of the Company (the “Committee”).

 

(b)                                 ThisOption shall not be exercisable during the first year from the date of granthereof and thereafter shall be exercisable in installments as to (i) no morethan twenty-five percent (25%) of the total number of shares subject to thisOption during the second year from the date hereof, (ii) no more than fiftypercent (50%) of the total number of shares subject to this Option during thethird year from the date hereof, (iii) no more than seventy-five percent (75%)of the total number of shares subject to the option during the fourth year fromthe date hereof, and (iv) all shares subject to this Option from and after thefourth anniversary of the date hereof.

 

(c)                                  Inconnection with the exercise of this Option and as a condition of delivery ofthe shares issuable upon exercise thereof, the Option Holder shall remit whendue an amount sufficient to satisfy all current or estimated future federal,state and local withholding tax requirements and any federal social security orother employment tax or other tax requirements relating thereto.  Subject to the right of the Committee (or,if applicable, the body or persons then administering the Plan) to disapproveany such election and require Option Holder to pay all of the aggregatewithholding taxes in cash, the Option Holder may elect to satisfy, in whole orin part, the foregoing withholding requirement by delivering a number of sharesof previously acquired Class A Common Stock having a Fair Market Value(determined as of the date of exercise of this Option) equal to all or part ofthe aggregate withholding taxes and, if applicable, cash or a check payable tothe Company for any remaining portion of the aggregate withholding taxes.  An election by Option Holder to pay anyportion of the aggregate withholding taxes with shares of previously acquired ClassA Common Stock must be made concurrently with the related exercise of thisOption and shall be irrevocable as to the Option Holder once such election ismade.

 

(d)                                 Ifrequested by the Committee, prior to the acceptance of shares of Class A CommonStock as provided in subparagraph (a) or (c) of this Paragraph 2, the OptionHolder

 

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shall supply the Committee with writtenrepresentations and warranties, including without limitation a representation andwarranty that the Option Holder has good and marketable title to such sharesfree and clear of liens and encumbrances.

 

3.                                       Termination.  The unexercised portion of this Option shallautomatically and without notice terminate and become null and void at the timeof the earliest to occur of the following:

 

(a)                                  TheExpiration Date;

 

(b)                                 Theexpiration of thirty (30) days from the date of termination (other than atermination described in subparagraph (d) and subparagraph (e) below or onaccount of death) of the Option Holder’s employment with the Company or itssubsidiary corporations, provided that if the Option Holder shall die duringsuch thirty-day (or shorter) period, the provisions of subparagraph (c) belowshall apply; provided that no unvested portion of this Option shall vest orbecome exercisable during such thirty (30) day period;

 

(c)                                  Theexpiration of one (1) year following the date of the Option Holder’s death ifsuch death occurs during his employment with the Company or its subsidiarycorporations; provided that no unvested portion of this Option shall vest orbecome exercisable during such one (1) year period;

 

(d)                                 Theexpiration of one (1) year from the date of termination of the Option Holder’semployment with the Company or its subsidiary corporations if such terminationis attributable to a disability of the Option Holder within the meaning ofSection 22(e)(3) of the Code (the Committee shall have the right to determinewhether the Grantee’s termination is attributable to a disability of theGrantee within the meaning of Section 22(e)(3) of the Code, such determinationof the Committee to be final and conclusive); provided that no unvested portionof this Option shall vest or become exercisable during such one (1) yearperiod; and

 

(e)                                  Thedate of termination of the Option Holder’s employment with the Company or itssubsidiary corporations, if such termination constitutes or is attributable toa breach by the Option Holder of an employment agreement with the Company orits subsidiary corporations or if the Option Holder is discharged for cause(the Committee shall have the right to determine whether the Option Holder hasbeen discharged for cause and the date of such discharge, such determination ofthe Committee to be final and conclusive).

 

4.                                       ContinuedEmployment.  Nothing contained inthe Plan or in this Option shall obligate the Company or any of its subsidiarycorporations to continue to employ or engage the Option Holder as an employeeof the Company or in any other capacity with the Company or any of itssubsidiary corporations, nor confer upon the Option Holder any right tocontinue in the employ or in any other capacity with the Company or itssubsidiary corporations, nor limit in any way the right of the Company or itssubsidiary corporations to amend, modify or terminate the Option Holder’scompensation or employment agreement, if any, at any time.

 

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5.                                       Non-Assignability.  The Option Holder shall not transfer,assign, pledge or hypothecate in any manner this Option or any of the rightsand privileges granted hereby other than by will or by the laws of descent anddistribution.  This Option isexercisable during the Option Holder’s lifetime only by the Option Holder.  Upon any attempt by the Option Holder totransfer this Option or any right or privilege granted hereby other than bywill or by the laws of descent and distribution and contrary to the provisionshereof, this Option and said rights and privileges shall immediately become nulland void.

 

6.                                       Anti-Dilution.

 

(a)                                  Inthe event that the shares of Class A Common Stock subject to this Option shallbe changed into or exchanged for a different number or kind of shares of stockor other securities of the Company or of another corporation (whether by reasonof merger, consolidation, recapitalization, reclassification, split-up,combination of shares, or otherwise) or if the number of such shares of Class ACommon Stock shall be increased solely through the payment of a stock dividend,then there shall be substituted for or added to, each share of stock of theCompany theretofore appropriated or thereafter subject to this Option thenumber and kind of shares of stock or other securities into which eachoutstanding share of stock of the Company shall be so changed, or for whicheach such share shall be exchanged, or to which each such share shall beentitled, as the case may be.  ThisOption shall also be appropriately amended as to price and other terms as maybe necessary to reflect the foregoing events. In the event there shall be any other change in the number or kind ofthe outstanding shares of stock of the Company subject to this Option, or ofany stock or other securities into which such stock shall have been changed, orfor which it shall have been exchanged, then if the Committee, in its solediscretion, determines that such change equitably requires an adjustment inthis Option, such adjustments shall be made in accordance with suchdetermination.

 

(b)                                 Fractionalshares resulting from any adjustment in this Option pursuant to this Paragraph6 shall be eliminated.  Notice of anyadjustment shall be given by the Company to the Option Holder and suchadjustment (whether or not such notice is given) shall be final and conclusivefor all purposes hereof.

 

7.                                       SecuritiesLaw.

 

(a)                                  TheOption Holder agrees that the Committee may postpone any exercise of thisOption for such time as the Committee in its sole discretion may deem necessaryor condition the exercise thereof in such manner as the Committee may determinein order to permit the Company with reasonable diligence (i) to effect ormaintain the listing of such shares on any securities exchanges or in theNASDAQ Stock Market, or (ii) to effect or maintain registration orqualification under the Securities Act of 1933, as amended (the “Act”), or anyapplicable state statute, of the shares issuable upon the exercise of thisOption, or (iii) to determine that such shares are exempt from registration orqualification and in connection therewith to require (x) as a condition of theissuance of shares upon exercise of the Option, that the Option Holderrepresent and agree that the Option Holder is acquiring shares of Class ACommon Stock upon exercise of this Option for investment and without a view tothe distribution or resale thereof in violation of the Act and/or anyapplicable state securities law and (y) that the certificates

 

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evidencing such shares bear a legend setting forthsuch representation.  The Company shallnot be obligated by virtue of this Agreement or any provision of the Plan torecognize the exercise of this Option or to sell or issue shares in violationof the Act or of the law of any state having jurisdiction thereof.  Any such postponement shall not extend theterm of this Option; and neither the Company nor its directors or officersshall have any obligation or liability to the Option Holder, or to the OptionHolder’s legal representative of his estate or the person(s) who acquire theright to exercise this Option by bequest or inheritance or by reason of thedeath of Option Holder, with respect to any shares as to which this Optionshall lapse because of such postponement.

 

(b)                                 Ifupon the date hereof neither this Option or the shares of Class A Common Stockissuable upon exercise hereof are registered under the Act and/or anyapplicable state securities laws, the Option Holder represents that he isacquiring this Option and shall acquire any shares of Class A Common Stock uponthe exercise hereof in good faith for purposes of investment and without a viewto any distribution thereof in violation of the Act and the rules andregulations promulgated thereunder or of any applicable state securities laws.  Under such circumstances, the Option Holderunderstands that the Company is and will be relying upon the truth and accuracyof the foregoing representation in granting this Option and issuing the Class ACommon Stock without first registering the issuance thereof under the Act orapplicable state securities laws.  TheOption Holder acknowledges that, if the shares of Class A Common Stock issuableupon exercise hereof are not so registered, then, until such shares have beenso registered (and the Company is not obligated to register such shares), suchshares must be held indefinitely or until such time, if any, as herein providedand until such shares are either registered under the Act and/or applicablestate securities laws or transfers may be made pursuant to an exemption from suchregistration as is accorded by the Act or the rules and regulations promulgatedthereunder and/or applicable state securities laws.  If such shares are not so registered, the Option Holder agreesthat at the time of any exercise hereunder, he will provide the Company with aletter embodying the aforementioned expressions of understanding and intent(and any representations as may be required under federal or state law) andagrees that any shares issued to him following the exercise of any option arisinghereunder may bear such restrictive legend as the Company may deem necessary toreflect the status of such shares under the Act and/or applicable statesecurities laws.  Before consenting tothe removal of such legend and the transfer of any such shares, the Company mayinsist upon the delivery to it of an opinion from counsel, satisfactory to it,that the contemplated transfer does not constitute a violation of the Actand/or applicable state securities laws.

 

8.                                       Terminationand Acceleration upon Merger.  TheCommittee shall have the power, in the event of any merger or consolidation ofthe Company with or into any other corporation, the merger or consolidation ofany other corporation into the Company, or the sale of all or substantially allof the assets and business of the Company to another corporation, to amend thisOption to permit the exercise of this Option prior to the effectiveness of suchmerger, consolidation or sale of assets and to terminate this Option as of sucheffectiveness.  In such event, theCompany shall give written notice of such amendment and termination to theOption Holder and this Option shall terminate on such date as may be specifiedby the Committee in its discretion, provided, however, that such date shall notbe less than fifteen (15) days after the date of such written notice.  If the Committee shall exercise such power,this Option shall be deemed

 

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to have been amended to permit the exercise hereof in whole or in partas determined by the Committee prior to the effectiveness of such merger,consolidation or sale of assets and this Option shall be deemed to terminate asspecified in the preceding sentence.

 

9.                                       Rightsas a Stockholder.  Neither theOption Holder nor any other person legally entitled to exercise this Optionshall be entitled to any of the rights or privileges of a stockholder of theCompany in respect to any shares issuable upon any exercise of this Optionunless and until a certificate or certificates representing such shares shallhave been actually issued and delivered to such person.

 

10.                                 Notices.  Whenever under this Agreement notice isrequired to be given in writing, it shall be deemed to have been duly givenupon personal delivery, upon deposit with an air courier guaranteeing overnightdelivery, or two (2) days after deposit in mail if mailed by registered orcertified mail, postage prepaid, to the Company at the address set forth belowor to Option Holder at the address set forth on the last page hereof (or tosuch other address as either party shall have indicated to the other party bynotice in accordance with this Paragraph):

 

Company:                                          ArdenGroup, Inc.

2020 South Central Avenue

Compton, California 90220

Attention: Chief Financial Officer

 

11.                                 Benefit.  Except as otherwise specifically providedherein, this Agreement shall be binding upon and shall operate for the benefitof the Company and the Option Holder and his successors.

 

12.                                 GoverningLaw.  This Agreement and any rightsand obligations arising hereunder shall be governed and construed in accordancewith the laws of the State of California.

 

13.                                 EntireAgreement.  This Agreementrepresents the entire agreement between the parties hereto regarding options onthe Company’s Class A Common Stock and supersedes any and all prior orcontemporaneous written or oral agreements or discussions between the partiesand any other person or legal entity concerning the transactions contemplatedherein.  Except as otherwise expresslyprovided herein, this Agreement cannot be amended or modified except by awritten instrument executed by the parties hereto.

 

14.                                 Construction.  The headings of the Paragraphs are forreference purposes only and shall not affect in any way the meaning orinterpretation of this Agreement.  Ifany of the provisions of this Agreement shall be unlawful, void or for anyreason unenforceable, they shall be deemed separable from, and shall in no wayaffect the validity or enforceability of, the remaining provisions of thisAgreement.

 

15.                                 FurtherActs.  The parties hereto agree toexecute and deliver such further instruments as may be reasonably necessary tocarry out the intent of this Option.

 

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IN WITNESS WHEREOF, the parties have executed thisStock Option Agreement as of the day and year first above written.

 
| ARDEN GROUP, INC. | OPTION HOLDER:      |
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|              | Address for Notice: |
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The undersigned, thespouse of Option Holder, does hereby agree to be bound by the terms of theforegoing Stock Option Agreement.

 
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