[Form of Agreement]
OUTLOOK GROUP CORP.
NONQUALIFIED STOCK OPTION
AGREEMENT
Option granted the 18th day of December, 1996, by OUTLOOK GROUP
CORP., a Wisconsin corporation (hereinafter called "Company"), to
___________________, non-employed Board of Director member of
Outlook Group Corp. (hereinafter called "Optionee") pursuant to
the grant of the Board.
1. Number of Shares Optioned; Exercise Price. The Company
grants to Optionee the right and option to purchase, from
time to time, on the terms and conditions hereof, all or any
part of an aggregate of 3,000 shares of the Company's Common
Stock, $.01 par value, at the exercise price of $4.675 (four
and 67.5/100 Dollars) per share, subject to adjustment under
paragraph 16 hereof.
2. Nonqualified Stock Option. This Option is intended to be a
nonqualified stock option. It is not intended to be an
"incentive stock option" within the meaning of Section 422
of the Internal Revenue Code of 1986, as amended (the
"Code").
3. Vesting. Except as provided in paragraph 13, this Option
may not be exercised until June 18, 1997, six months from
the date of grant; and then this Option may be exercised, in
whole or in part, only in accordance with the terms of this
Agreement.
4. Term of Option. If this Option is not earlier exercised or
terminated, all rights to exercise this Option shall expire
on December 18, 2001, five years from the date this Option
was granted or the end of the optionee's term on the Board,
whichever occurs first.
5. Method of Exercising Option. This Option shall be exercised
by delivering to the Company, at the office of its
Secretary, a written notice of the number of shares with
respect to which the Option is at the time being exercised
and by paying the Company in full the exercise price of the
shares being acquired at the time.
6. Manner of Payment. The exercise price for shares purchased
pursuant to this Option shall be paid in full at the time of
exercise and no shares shall be issued until full payment
therefore is made. Such payment may be made either (i) in
cash or (ii) at the discretion of the Compensation Committee
(the "Committee") of the Board of Directors of the Company,
by delivering shares of the Company's Common Stock which
have been beneficially owned by Optionee, Optionee's spouse,
or both of them for a period of at least one year prior to
the time of exercise ("Delivered Stock") or a combination of
cash and Delivered Stock. Delivered Stock shall be valued
at its Fair Market Value determined as of the date of
exercise.
7. Method of Valuation. For all purposes of this Agreement,
the term "Fair Market Value" on any date shall be the
average of the highest and lowest sale prices of the shares
on such date (or, if such date is not a trading date, on the
next preceding trading date) as reported by NASDAQ (the
National Association of Securities Dealers, Inc. Automated
Quotation System). However, if at any time the Common Stock
of the Company is listed on any other exchange, the "Fair
Market Value" shall be the average of the reported highest
and lowest prices at which shares are sold on such exchange
on such date (or, if such date is not a trading date, on the
next preceding trading date). In the absence of reported
sales on NASDAQ or on such exchange on any trading date, the
"Fair Market Value" shall be the average of the reported
closing bid and asked price for the shares on NASDAQ or such
exchange on such date.
8. Deferral of Exercise. Although the Company intends to exert
its best efforts sot that the shares purchasable upon the
exercise of this Option, when it first becomes exercisable,
will be registered under, or exempt from the registration
requirements of, the Securities act of 1933, as amended (the
"Securities Act"), and any applicable state securities law,
if the exercise of this Option would otherwise result in the
violation by the Company of any provision of the Securities
Act or of any state securities law, the Company may require
that such exercise be deferred until the Company has taken
appropriate action to avoid any such violation.
9. Rights of Shareholder. Optionee shall not be deemed the
holder of any shares subject to this Option until the shares
covered by this Option are fully paid and issued to optionee
upon exercise of this Option.
10. Transferability of Options. This Option may not be
transferred except by will or the laws of descent and
distribution, and may be exercised during the lifetime of
Optionee only by him or by his guardian or legal
representative. This Option and any rights and privileges
pertaining hereto shall not be transferred, assigned,
pledged or hypothecated by Optionee in any way, whether by
operation of law or otherwise, and shall not be subject to
execution, attachment or similar process.
11. Death of Optionee. If the Optionee dies while serving on
the Board, the personal representative of Optionee's estate
or the person or persons to whom this Option is transferred
by will or the laws of descent and distribution may, at any
time within one year after the date of death, but not later
than the date of expiration of this Option, exercise this
Option to the extent Optionee was entitled to do so on the
date of death. This Option or any portion of this Option
not so exercised shall terminate.
12. Changes in Common Stock. In the event of a reorganization,
recapitalization, stock split, stock dividend, merger,
consolidation, combination or exchange of shares, rights
offering or any other change affecting the Common Stock of
the Company, the Committee shall make, subject to approval
of the Board of Directors, such adjustments, if any, as it
deems to be equitable in the number, exercise price and kind
of shares covered by this Option.
13. Dissolution or Merger. Anything contained herein to the
contrary notwithstanding, upon the dissolution or
liquidation of the Company, or upon any merger in which the
Company is not the surviving corporation, at any time prior
to the expiration date of this Option, Optionee shall have
the right within sixty (60) days prior to the effective date
of such dissolution, liquidation or merger, to surrender
this Option, whether or not vested, to the Company for cash,
subject to the discretion of the Committee as to the exact
timing of said surrender, but such right of surrender shall
apply only if, and to the extent that, the Optionee could
not realize the value of this Option by exercising it
(because this Option was not then presently exercisable, or
because the exercise of this Option would result in a
forfeiture under Section 16 of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), or the like). The
amount of cash to be paid to the Optionee, subject to any
applicable withholding taxes, for any portion of this Option
surrendered hereunder shall be the amount by which the Fair
Market Value of the shares covered by the surrendered
portion of this Option, determined at the time of surrender,
exceeds the exercise price thereof.
14. Withholding Taxes.
(a) The Company may require, as a condition to the exercise
of this Option, that Optionee concurrently pay to the
Company (either in cash or, at the request of Optionee
but in the discretion of the Committee and subject to
such rules and regulations as the Committee may adopt
from time to time, in share of Delivered Stock) the
entire amount or a portion of any taxes which the
Company is required to withhold by reason of such
exercise, in such amount as the Committee or the
Company in its discretion may determine.
(b) In lieu of part or all of any such payment, Optionee
may elect, subject to such rules and regulations as the
Committee may adopt from time to time, or the Company
may require, that the Company withhold from the shares
to be issued upon exercise of this Option that number
of shares having a Fair Market Value equal to the
amount which the Company is required to withhold.
(c) Any such request or election (to satisfy withholding
obligations using shares) by an Optionee who is an
officer or director of the Company who is subject to
the provisions of Section 16 of the Exchange Act shall
be made in accordance with the rules and regulations of
the Securities and Exchange Commission promulgated
thereunder.
15. Notices. Any notice to be given to the Company under the
terms of this Agreement shall be addressed to the Company,
in care of its Secretary. Any notice to be given to
Optionee may be addressed to Optionee at his address as it
appears on the Company's records, or at such other address
as the Optionee may hereafter designate in writing to the
Company. Any such notice shall be deemed to have been duly
given if and when personally delivered or enclosed in a
properly sealed envelope addressed as aforesaid, and
deposited, postage prepaid, in the United States mails.
16. Successors. This Agreement shall be binding upon and inure
to the benefit of any successor or successors of the
Company.
17. Wisconsin Contract. This Option has been granted in
Wisconsin and shall be construed under the laws of that
state.
IN WITNESS WHEREOF, the Company has caused these presents to be
executed in its behalf by its President or Executive Vice
President, and the Optionee has hereunto set his hand and seal,
all of the day and year first above written, which is the date of
the granting of the Option evidenced hereby.
OUTLOOK GROUP CORP.
By:___________________________
Title: Chairman and President
______________________________
Optionee