Document:

EXHIBIT
10.6

 

INAMED CORPORATION

 

EXECUTIVE OFFICER OPTION AGREEMENT

 

THE SECURITIES REPRESENTED BY THIS INSTRUMENT
OR DOCUMENT HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. WITHOUT SUCH REGISTRATION. SUCH
SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED AT ANY TIME WHATSOEVER,
EXCEPT UPON DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL SATISFACTORY
TO THE CORPORATION TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED FOR SUCH
TRANSFER OR THAT ANY SUCH TRANSFER WILL NOT BE IN VIOLATION OF THE SECURITIES
ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR ANY RULE OR
REGULATION PROMULGATED THEREUNDER.

 

This Stock Option Agreement
(this “Agreement”) is made and entered into at New York, New York, as of
the date hereinafter set forth by and between INAMED CORPORATION, a
Delaware corporation (the “Corporation”), and NICHOLAS L. TETI (the “Optionee”).

 

WHEREAS, the Corporation wishes to grant the
Optionee a stock option (the “Stock Option”) which gives the Optionee
the right, but not the obligation, to purchase stock in the Corporation as
recognition of the Optionee’s services as Chief Executive Officer of the
Corporation, and

 

WHEREAS, the Optionee will, in consideration of the
receipt of said Stock Option, agree to the terms, conditions and provisions set
forth herein.

 

NOW, THEREFORE, in
consideration of the premises, it is agreed as follows:

 

1.             GRANT OF STOCK OPTION. Subject to the
conditions set forth herein, the Corporation hereby grants to the Optionee the
right, privilege and option to purchase Three Hundred Thousand (300,000) shares
(the “Option Shares”) of the Corporation’s Common Stock, par
value $.01 per share (the “Common Stock”), at a price per share (the “Strike
Price”)  equal to the closing price on July 9, 2001, in the manner
hereinafter provided, effective as of July 23, 2001 (the “Grant Date”),
to be vested as follows, unless this Stock Option has been terminated pursuant
to Section 3 hereof:

 

a.                                       200,000 shall
vest ratably on the first, second and third anniversaries of the Grant Date,
and

 

b.                                      100,000 shall
vest upon the Optionee’s attainment of performance targets recommended jointly
by the Optionee and the Chairman of the Corporation and approved by the
Compensation Committee of the Corporation within sixty (60) days of the
Effective Date of the employment agreement entered into as of July 23, 2001
between the Corporation and the Optionee (the “Employment Agreement”);

 

provided, however, that this Stock Option,
unless it has expired or has been earlier terminated, shall, as to the Option
Shares granted pursuant to Section 1a., immediately vest upon a Change in
Control. The Option Shares granted pursuant to Section 1b. shall immediately
vest upon a Change in Control, depending upon the price of the Common Stock
with respect to any such Change in Control, according to the following
schedule:

 

	
  Stock Price at Change in Control

  	
   

  	
  Percentage
  of Option Shares

  to Be Immediately Vested

  	
   

  
	
  $

  	
  33.00

  	
   

  	
  10

  	
  %

  
	
  $

  	
  35.00

  	
   

  	
  30

  	
  %

  
	
  $

  	
  36.00

  	
   

  	
  35

  	
  %

  
	
  $

  	
  37.00

  	
   

  	
  40

  	
  %

  
	
  $

  	
  38.00

  	
   

  	
  45

  	
  %

  
	
  $

  	
  39.00

  	
   

  	
  50

  	
  %

  
	
  $

  	
  40.00

  	
   

  	
  60

  	
  %

  
	
  $

  	
  41.00

  	
   

  	
  70

  	
  %

  
	
  $

  	
  42.00

  	
   

  	
  80

  	
  %

  
	
  $

  	
  43.00

  	
   

  	
  90

  	
  %

  
	
  $

  	
  44.00

  	
   

  	
  100

  	
  %

  

 

For purposes of this Agreement, “Change in
Control” shall be deemed to have the same meaning as set forth in the
Employment Agreement.

 

In the event of any split, combination
reclassification, recapitalization, merger, consolidation or any other
extraordinary corporate transaction occurring after the date of this Agreement
which the Compensation Committee or any successor committee determines will
result in a change in the Common Stock for which an adjustment pursuant to this
paragraph is appropriate in order to preserve the benefits to the Optionee of
this Stock Option, the Strike Price, the type of securities or other property
subject to this Stock Option and/or the number of Option Shares (or other
securities or property) shall be adjusted in a manner in which the Compensation
Committee determines to be appropriate under the circumstances. In addition, if
a Change in Control occurs, the Corporation shall have the right, but not the
obligation, exercisable by written notice to the Optionee prior to the Change
in Control, to cancel this Stock Option at the time the transaction resulting
in the Change in Control is consummated and to pay to the Optionee in
connection with the cancellation of this Stock Option an amount, in cash or
check, equal to (a) the excess of the greater of (i) the per share price paid
for the Common Stock in the Change in Control (or the fair market value of any
property received per share of the Common Stock in the Change in Control) and
(ii) the average closing price of the Common Stock for the five (5) trading
days prior to the

 

2

exercise of such right by the Corporation,
over the Strike Price of this Stock Option, multiplied by (b) the number of
shares of Common Stock subject to the unexercised portion of this Stock Option
(whether vested or not).

 

2.               METHOD
OF EXERCISE. Option Shares purchased upon exercise of this Stock
Option shall, at the time of purchase, be paid in full, either in cash and/or
in shares of Common Stock held by the Optionee for at least (6) six months and
having a fair market value (based on the average closing price of the Common
Stock for the five (5) trading day period immediately prior to the date of
exercise) which, when added to the portion of the Total Strike Price to be paid
in cash, equals the total Strike Price for the portion of this Stock Option
being exercised.

 

To the extent that the right
to purchase Option Shares has accrued hereunder, this Stock Option may be
exercised, from time to time, by written notice to the Corporation stating the
number of Option Shares with respect to which this Stock Option is being
exercised and the time of delivery thereof, which shall be at least fifteen
(15) days after the giving of such notice, unless an earlier date shall have
been mutually agreed upon. In no event, shall the Corporation be required to
honor any notice of exercise if the same is received by the Corporation more
than fifteen (15) days after the termination of this Stock Option pursuant to
Section 3.

 

At the time specified in
such notice, the Corporation shall, without transfer or issue tax to the
Optionee, deliver to him by certified mail, a certificate or certificates for
such Option Shares, against the payment by Optionee of the Strike Price, in
full, for the number of Option Shares to be delivered, by certified or bank
cashier’s check, or the equivalent thereof acceptable to the Corporation, or
through the use of Common Stock in accordance with the above; provided,
however, that the time of such delivery may be postponed by the
Corporation for such period as may be required for it, with reasonable
diligence, to comply with any requirements of any state or federal agency or
any securities exchange. If the Optionee fails to accept delivery of and pay or
any for part of the number of Option Shares specified in the notice given by
the Optionee, upon tender and delivery of said shares, the Optionee’s right to
exercise this Option with respect to such undelivered shares shall be
terminated.

 

3.             TERMINATION
OF STOCK OPTION. Except as otherwise stated in this Agreement, this
Stock Option, to the extent not previously exercised, shall expire at 5:00 p.m.
California time on the fifth (5th) anniversary of this Agreement; provided,
however, that in the event of a termination of the Optionee’s
employment with the Corporation or any affiliate, the unvested and
unexercisable Stock Options shall immediately terminate, and the vested and
exercisable Stock Option remain exercisable as follows:

 

a.                                       if the
Optionee’s employment is terminated as a result of his death or Disability, by
the Corporation without Cause or by the Optionee for Good Reason (as each term
is defined in the Employment Agreement), the Stock Options shall expire on the
first anniversary of the Optionee’s termination; and

 

b.
                                   if the
Optionee’s employment is terminated by the Corporation for Cause or by the
Optionee without Good Reason, or the Employment Agreement expires by its terms,
the Stock Options shall expire sixty (60) days from the date of termination;
and

 

3

c.                                       if the
Optionee’s employment is terminated following a Change in Control pursuant to
Section 9 of the Employment Agreement, the Stock Options shall expire on the
earlier of (i) twelve (12) months following termination and (ii) the fifth (5th)
anniversary of this Agreement.

 

Notwithstanding any provision herein, the
Corporation’s Board of Directors may extend the term of this Stock Option as it
deems appropriate.

 

4.             LISTING, REGISTRATION
AND OTHER LEGAL COMPLIANCE. 
No shares of the Common Stock shall be required to be issued or granted
under this Agreement unless legal counsel for the Corporation shall be
satisfied that such issuance or grant will be in compliance with all applicable
securities laws and regulations and any other applicable laws or
regulations.  The Board or the
Compensation Committee may require, as a condition of any payment or share
issuance, that certain agreements, undertakings, representations, certificates,
and/or information, as the Board or the Compensation Committee may deem
necessary or advisable, be executed or provided to the Corporation to assure compliance
with all such applicable laws or regulations.

 

Certificates for shares of
Common Stock delivered under this Agreement may bear appropriate legends and
may be subject to such stock-transfer orders and such other restrictions as the
Board or the Compensation Committee may deem advisable under the rules,
regulations, or other requirements of the Securities and Exchange Commission,
any stock exchange upon which the Common Stock is listed, and any applicable
securities law. In addition, if, at any time specified herein for (a) the
making of any determination, (b) the issuance or other distribution of Common
Stock, or (c) the payment of amounts to any optionee with respect to any Stock
Option, any law, rule, regulation or other requirement of any governmental
authority or agency shall require either the Corporation, any subsidiary or any
optionee (or any estate, designated beneficiary or other legal representative
thereof) to take any action in connection with any such determination, any such
shares to be issued or distributed, any such payment, or the making of any such
determination, as the case may be, shall be deferred until such required action
is taken.

 

5.             TRANSFERABILITY OF
STOCK OPTION; RIGHTS PRIOR TO EXERCISE.  During the Optionee’s lifetime, this Stock Option shall be
exercisable only by the Optionee, or any guardian or legal representative of
the Optionee in accordance with the Employment Agreement, except as otherwise
provided in this Agreement. This Stock Option is freely transferable at the option
of the Optionee to the Optionee’s spouse, lineal descendants (including those
adopted) or any lineal descendant of the Optionee’s siblings, or to any
financial institution in connection with a bona fide financial transaction
(collectively, the “Permitted Transferees”) or to any trust created
solely for the benefit of a Permitted Transferee, provided that any Permitted
Transferee must give the Corporation written notice of such transfer within ten
(10) days of the transfer and must agree in a writing satisfactory to the
Corporation to be bound by terms of this Agreement. The Optionee also shall be
permitted to pledge this Stock Option to a financial institution in connection
with any bona fide financial transaction.

 

The Optionee shall have no
rights as a shareholder of shares subject to this Stock Option until payment of
the Strike Price pursuant to Section 2 and the delivery of such shares are
herein provided.

 

4

6.             EMPLOYMENT MATTERS.
This Agreement shall not confer upon the Optionee any right to continued
employment or, in the case of an Optionee who is a director, continued service
as a director, with the Corporation or a subsidiary, as the case may be, nor
shall it interfere in any way with the right of the Corporation or any
subsidiary to terminate the employment of any of its employees, the service of
any of its directors or the retention of any of its consultants or advisors at
any time.

 

7.             GOVERNING LAW;
HEADINGS.    This Agreement and
all actions taken thereunder shall be governed by and construed in accordance
with the laws of the State of New York, without reference to the principles of
conflict of laws thereof. Any titles and headings herein are for purposes only,
and shall in no way limit, define or otherwise affect the meaning, construction
or interpretation of any provisions of this Agreement.

 

8.             TAX WITHOLDING.
The Corporation shall have the right to deduct from any payment or settlement
under this Agreement, including, without limitation, the exercise of this Stock
Option, any federal, state, local, foreign or other taxes of any kind which the
Board or the Compensation Committee, in its sole discretion, deems necessary to
be withheld to comply with the Internal Revenue Code of 1986, as amended,
and/or any other applicable law, rule or regulation. In addition, the
Corporation shall have the right to require a payment from the Optionee to
cover any applicable withholding or other employment taxes due upon the
exercise of this Stock Option.

 

9.             BINDING EFFECT.
This Agreement shall be binding upon the heirs, executors, administrators and
successors of the parties hereto.

 

 

IN WITNESS WHEREOF, the parties agree that
this Agreement shall be effective as of the 23rd day of July, 2001.

 

 

	
  CORPORATION

  	
   

  	
  NICHOLAS L. TETI

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Richard G. Babbit

  	
   

  	
  By:

  	
  [illegible]

  
	
   

  	
  Richard G. Babbit

  	
   

  	
   

  	
  Signature

  
	
   

  	
  Chairman of the Board

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  ###-##-####

  
	
   

  	
   

  	
   

  	
   

  	
  Social Security Number

  
	
  Date:

  	
  7/27/01

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Date:

  	
  8/7/01

  

 

 

NUMBER
OF OPTION SHARES SUBJECT TO THIS OPTION:

Three
Hundred Thousand (300,000) EXACTLY

 

STRIKE
PRICE: Twenty-Five Dollars and Two Cents ($25.02) PER SHARE

 

 

5Exhibit
10.7

 

 

INAMED
CORPORATION

OPTION
AGREEMENT

PURSUANT
TO THE

200
STOCK OPTION PLAN AS AMENDED

 

 

	
  Name of Optionee:

  	
  Hani Zeini

  
	
  Number of Shares subject
  to Options:

  	
  100,000

  
	
  Option Exercise Price:

  	
  $17.00 per share

  
	
  Grant Date:

  	
  September 28, 2001

  
	
  Vesting Dates:

  	
  One-Third of Option Shares
  on each of

  
	
   

  	
  September 28, 2002,
  September 28, 2003 and

  
	
   

  	
  September 28, 2004

  
	
  Expiration Date:

  	
  September 28, 2006

  

 

 

                Pursuant
to the Inamed corporation 2000 Stock Option Plan, as amended (the “Plan”),
Inamed Corporation, a Delaware corporation (the “Company”), hereby grants to
the Optionee named above an option (the “Option”) to purchase, on or prior to
the Expiration Date specified above, all or any part of the number of shares of
common stock, par value $.01 per share, of the Company (each, a “Share”),
specified above (the “Option Shares”) at the Option Exercise Price per Share
specified above, subject to the terms and conditions set forth in this
agreement (this “Agreement”) and in the Plan (as modified fro time to time in
accordance with the terms thereof). This Option is not intended to qualify and
shall not be treated as an “incentive stock option” under Section 422 of the
Internal Revenue Code of 1986, as amended from time to time (the “Code”),
Capitalized terms not defined herein shall have the meanings ascribed in the
Plan.

 

                1.             Vesting Schedule. Except as
set forth below, and subject to the determination of the Committee in its sole
discretion to accelerate the vesting schedule hereunder upon the occurrence of
a Change of Control, this Option shall become exercisable with respect to the
number of Option Shares specified on the Vesting Dates set forth above. Once
exercisable, this Option shall continue to be exercisable at any time or times
prior to the Expiration Date, subject to the provisions hereof and of the Plan.

 

                2.             Exercise of Option.

 

                                (a)           The Option shall be exercised in the
following manner: the Optionee, or the person or persons having the right to
exercise the Option upon the death or Permanent Disability (as defined below)
of the Optionee, shall deliver to the Company a written notice specifying the
number of Option Shares that the Optionee elects to purchase. The Optionee must
include with the notice full payment for any Option Shares being purchased
under an Option.

 

(b)                   Payment of the Option
Exercise Price for any Option Shares being purchased must be made either (i) in
cash, by certified check or by cashier’s check or (ii) through the delivery of
Shares owned by the Optionee for at least six months prior to the date of
exercise having a Fair Market Value equal to the Option Exercise Price.

 

(c)                   The Company may require the
Optionee to remit to the Company prior to the delivery of any Option Shares to
which such Optionee shall be entitled upon exercise of the Option, an amount in
cash equal to the amount of any federal, state and local tax required to be
withheld.  With the approval of the
Committee, the Optionee may satisfy the foregoing requirement by electing to
have the Company withhold from delivery Shares having a value equal to the
amount of tax to required to be withheld. 
Such Shares shall be valued at their Fair Market Value on the date of
which the amount of tax required to be withheld is determined (the “Tax
Date”).  Fractional share amounts shall
be settled in cash.  Such a withholding
election may be made with respect to all or any portion of the shares to be
delivered pursuant to the Option.

 

(d)                   Notwithstanding any other
provision hereof or of the Plan, no portion of this Option shall be exercisable
(i) after its termination in accordance with the provisions hereof or (ii)
after the Expiration Date hereof.

 

3.     Incorporation of Plan.  Notwithstanding anything herein to the
contrary, this Option shall be subject to and governed by all the terms and
conditions of the Plan, as the same may be modified or amended from time to
time in accordance with the terms of the Plan.

 

4.     Termination of Employment.  Except as provided in this Section 4, no
Option (whether or not exercisable) may be exercised after the Optionee has
ceased to be employed by the Company or any Subsidiary.  In the event of the termination of the
Optionee’s employment by the Company or any Subsidiary for any of the reasons
set forth below, any Options held by such Optionee may be exercised following
such termination in accordance with this Section 4.

 

(a)                   If the Optionee’s employment
is terminated by reason of the Optionee’s Permanent Disability (as defined
below) or death, all outstanding Options that were otherwise exercisable shall
remain exercisable for one year following the date of such termination of
employment (but in no event later than the Expiration Date).  Options that had not yet become exercisable
as of the date of any such termination shall terminate immediately effective as
of such date, with no payment made in consideration therefor.  For purposes of this Agreement, “Permanent
Disability” shall have the same meaning as in the Company’s Long Term
Disability Plan.

 

(b)                   If the Optionee voluntarily
terminates employment with the Company or any Subsidiary for any reason other
than Permanent Disability or death or if the

 

2

 

Optionee’s employment is involuntarily
terminated by the Company or any Subsidiary (other than for Cause, as defined
below), outstanding Options that were otherwise exercisable as of the date of
such termination shall remain exercisable for a period of ninety (90) days
following such termination (but in no event later than the Expiration Date),
and shall thereafter terminate.  Options
that had not yet become exercisable as of the date of such termination shall
terminate immediately effective as of such date, with no payment made in
consideration therefor.  For purposes of
this Agreement, “Cause” shall mean (a) the willful and continued failure by the
Optionee to substantially perform the Optionee’s duties with the Company (other
than any such failure resulting from the Optionee’s incapacity due to physical
or mental illness) after a written demand for substantial performance is
delivered to the Optionee by the Company, which demand specifically identifies
the manner in which the Company believes that the Optionee has not
substantially performed his or her duties, or (b) the willful engaging by the
Optionee in conduct which is demonstrably and materially injurious to the
Company or its subsidiaries, monetarily or otherwise.  For purposes of clauses (a) and (b) of this definition, no act,
or failure to act, on the Optionee’s part shall be deemed “willful” unless
done, or omitted to be done, by the Optionee not in good faith and without
reasonable belief that the Optionee’s act, or failure to act, was in the best
interest of the Company.

 

(c)                   If the Optionee’s employment
is terminated by the Company for Cause, all outstanding Options, whether or not
exercisable as of the date of such termination, shall terminate immediately
effective as of such date, with no payment made in consideration therefor.

 

5.     Transferability.  This Agreement is personal to Optionee, is
non-assignable and is not transferable in any manner, by operation of law or
otherwise, other than by will or by the laws of descent and distribution, and
is exercisable, during Optionee’s lifetime, only by Optionee or his or her
guardian or legal representative.

 

6.     Effect of a Change of Control.  If a Change of Control occurs, the Committee
shall have the right, but not the obligation, to cancel this Option at the time
the transaction resulting in the Change of Control is consummated and to pay to
the Optionee in connection with the cancellation of this Option an amount, in
cash or check, equal to the product of (x) the excess of the per share price
paid for the Shares in the Change of Control (or the fair market value of any
property received for the Shares in the Change of Control) over the Option
Exercise Price of this Option, multiplied by (y) the number of vested Option
Shares per his Change of Control agreement.

 

7.     Miscellaneous.

 

(a)                   Entire Agreement.  This Agreement and the Plan contain all of the
understandings and agreements between the Company and the Optionee concerning
this Option and supersedes all earlier negotiations and understandings, written
or oral, between

 

3

 

the parties with respect thereto.  The Company and the Optionee have made no
promises, agreements, conditions or understandings, either orally or in
writing, that are not included in this Agreement or the Plan.

 

(b)                   Captions.  The captions and section numbers appearing
in this Agreement are inserted only as a matter of convenience.  They do not define, limit, construe or
describe the scope or intent of the provisions of this Agreement.

 

(c)                   Counterparts.  This Agreement may be executed in
counterparts, each of which when signed by the Company or the Optionee will be
deemed an original and all of which together will be deemed the same Agreement.

 

(d)                   Notices.  Any notice or communication having to do
with this Agreement must be given by personal delivery or by certified mail,
return receipt requested, addressed, if to the Company or the Committee, to the
attention of the Secretary of the Company at the principal office of the
Company and, if to the Optionee, to the Optionee’s last known address contained
in the personnel records of the Company.

 

(e)                   Acquisition for Purpose of
Investment.  The Optionee hereby
represents and warrants that any Option Shares acquired pursuant to the
exercise of this Option are or will be acquired for the Optionee’s own account
solely for the purpose of investment and not with a view to, or for sale in
connection with, any distribution thereof in violation of the Securities Act of
1933, as amended.

 

(f)                    Succession and Transfer.  Each and all of the provisions of this
Agreement are binding upon and shall inure to the benefit of the Company and
the Optionee and their respective estates, successors and assigns.

 

(g)                   Amendments.  Subject to the provisions of the Plan, this
Agreement may be amended or modified at any time only by an instrument in
writing signed by the parties hereto.

 

(h)                   Governing Law.  This Agreement shall be construed and
determined in accordance with the laws of the State of Delaware, without giving
effect to the choice of law principles thereof.

 

This Agreement is made under and subject to the provisions of
the Plan, and all of the provisions of the Plan are hereby incorporated herein
as provisions of this Agreement.  If
there is a conflict between the provisions of this Agreement and the provisions
of the Plan, the provisions of the Plan will govern.  By signing this Agreement, the Optionee confirms that he or she
has received a copy of the Plan and has had an opportunity to review the
contents thereof.

 

4

 

IN WITNESS WHEREOF, the
Company has caused this instrument to be executed in its name and on its behalf
as of the Grant Date set forth above.

 

 

	
  INAMED CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Nicholas L. Teti

  
	
   

  	
  NICHOLAS L. TETI

  
	
   

  	
  President and CEO

  
	
  Dated:  9-28-01

  

 

 

 

I hereby accept the
foregoing grant of an Option to acquire the Option Shares and understand and
agree that such Option and the Option Shares shall be subject to and governed
by the terms of the Plan and this Agreement.

 

	
  OPTIONEE

  
	
   

  
	
   

  
	
   

  
	
  /s/ Hani Zeini

  
	
  Hani Zeini

  
	
   

  
	
  SSN#  ###-##-####

  
	
   

  
	
  Dated:  9-28-01

  

 

5

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