Exhibit 10 (A) (16)
Chemfab Corporation
NONSTATUTORY STOCK OPTION AGREEMENT
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UNDER THE
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SECOND AMENDED AND RESTATED 1991 STOCK OPTION PLAN
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OFFICER FORM
------------
NONSTATUTORY STOCK OPTION AGREEMENT, dated October 30, 1997 (this
"Agreement"), beteen Chemfab Corporation (the "Company"), and _____________
__________________ presently residing at _____________________ ,
__________________ (the "Optionee").
WHEREAS, the Stock Option Committee of the Board of Directors of the
Company has determined that it is to the advantage and interest of the Company
and its stockholders to grant to the Optionee the nonstatutory stock option
provided for herein as an inducement to remain in the service of the Company and
its subsidiaries and as an incentive for increased effort during such service;
and
WHEREAS, the Optionee is engaged in the service of the Company and/or its
subsidiary corporations ("Related Corporations");
NOW, THEREFORE, the parties agree as follows:
1. Optionee's Continued Service. The Optionee shall remain continuously
(subject to the exceptions in Sections 2 and 4) in the service of the Company or
one or more of its Related Corporations in the capacity of employee, director
and/or consultant for a period of at least one year from the Grant Date and
shall, during such service, devote his or her time, energy and skill to the
service of the Company or one or more of its Related Corporations. Nothing
herein contained shall be deemed to confer upon the Optionee any right to
continue in the service of the Company or one or more of its Related
Corporations in any particular capacity or in general, nor to interfere in any
way with the right of the relevant corporation or corporations to terminate any
employment, consultancies and/or directorship of the Optionee at any time. If
the Optionee's service as an employee, consultant and director with the Company
and all its Related Corporations shall terminate prior to the earlier of the
first anniversary of the Grant Date or the day immediately preceding the date of
the Sellout Event (as defined in Section 2 hereof), the Optionee shall have no
rights whatsoever under this Agreement.
2. Grant of Option. Subject to the terms and conditions set forth herein,
the Company has granted to the Optionee on August 5, 1997 (the "Grant Date") an
option (the "Option") to purchase from the Company shares (the
"Optioned Shares") of the Company's common stock, par value $.10 per share (the
"Stock"). The Option is not intended to be treated as an "incentive stock
option" within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), but as a nonstatutory stock option within the meaning
of the Code. On each of the following dates (each a "Vesting Date" and
collectively the "Vesting Dates"), but only if the Optionee remains an employee,
director or consultant of the Company or one or more Related Corporations at
such Vesting Date (with the status of any corporation as a Related Corporation
to be determined as of such Vesting Date), the stated number of shares shall
become purchasable hereunder:
Date Number of Shares
---- -----------------
August 1, 1997 (25%)
August 1, 1998 (25%)
August 1, 1999 (25%)
August 1, 2000 (25%)
Notwithstanding the foregoing, if, before any Vesting Date, substantially all of
the outstanding voting stock or substantially all the assets of the Company is
or are acquired by any person or group of persons, or the Company is party to a
merger or consolidation of which the Company is not in economic substance the
predominant surviving entity, then the day immediately preceding the date of
such acquisition, merger or consolidation (the "Sellout Event") shall be
substituted for such of the Vesting Dates as may be the same as or later than
the date of the Sellout Event.
The Option must be exercised, if ever, before the tenth anniversary of the Grant
Date or within such shorter period as may result from the operation of Section
4.
3. Exercise Price. The exercise price to be paid for the Optioned Shares
shall be per share.
4. Termination of Option; Disgorgement of Certain Profits. (a) If all the
Optionee's service to the Company and all its Related Corporations as employee,
consultant and/or director terminates for any reason, other than death or
retirement from employment (but including termination of affiliation between the
Company and the Related Corporation with which Optionee is serving as employee,
consultant or director), the Option, to the extent exercisable on the date of
such termination, may be exercised by the Optionee at any time within 90 days
after termination, but only before the tenth anniversary of the Grant Date. If
the Optionee dies or retires from employment, the Option may be exercised, to
the extent exercisable on the date of such retirement or death, at any time by
the Optionee or his executor or administrator, as the case may be, but only
before the earlier of the first anniversary of the date of death or retirement
or the tenth anniversary of the Grant Date. Options which are not exercisable
at the time of termination of the Optionee's relationship with the Company and
all its Related Corporations as an employee, director and/or consultant or which
are so exercisable but are not exercised within the time periods described
above, shall terminate. Leave of absence for military service, illness or other
bona fide purpose shall not be deemed a termination for purposes of this Section
4 provided that it does not exceed the longer of 90 days or the period during
which the absent Optionee's rights are guaranteed by statute or by contract. If
the Optionee does not so return, his relationship with the Company and all its
Related Corporations as an employee, director and/or consultant shall be deemed
to have ended on the next day of such leave of absence.
(b) The Optionee covenants and agrees with the Company that if, during
the twelve-month period following the cessation of an Optionee's employment
with, and/or directorship of, and/or consultancy for, the Company or any Related
Corporation, as the case may be, and regardless of the reason or absence of
reason for such cessation (the date of which cessation hereinafter, a "Cessation
Date"), said Optionee engages directly or indirectly in any business, activity
or enterprise which diverts business from, is in conflict with, causes a
competitive disadvantage to, or otherwise adversely affects the interests or
business of, the Company or any Related Corporation (each of the foregoing, a
"Disgorgement Event"), then the Optionee shall automatically owe to the Company,
and shall promptly and without demand pay to the Company, with respect to each
share of Stock issued to the Optionee upon the full or partial exercise of this
Option from and after that date which is nine (9) months prior to the Optionee's
Cessation Date, an amount equal to the excess of Market Value of such share on
the date of exercise over the Option Price paid by the Optionee for such share;
provided that, on a case by case basis, a majority of disinterested members of
the Board of Directors or the Committee may, in their sole discretion, waive
enforcement of this provision, in whole or in part; and provided further that no
such waiver shall be deemed a waiver of enforcement in any other instance.
(c) The Optionee agrees and acknowledges that, because of the nature and
purpose of the grant of this Option, and because of the Optionee's position
with, and access to information of, the Company and/or one or more Related
Corporations, the consequences described in Section 4(b) constitute essential
terms of and are inseparable from the other terms and conditions of this Option
and are necessary for the protection and benefit of the Company. The Optionee
further agrees and acknowledges that the extent of harm to the Company that
would be caused by the Optionee in the event of a Disgorgement Event is not now
and will not be, at such time, precisely determinable and that the Company would
be without an adequate remedy in the event of a Disgorgement Event caused by the
Optionee absent the provisions of this Section 4.
5. Exercise of Option. (a) The Optionee may exercise the Option by giving
written notice in the manner provided in Section 11. The notice shall specify
the number of shares of the Stock which the Optionee elects to purchase. For
all shares which the Optionee elects to purchase, the Optionee shall except as
otherwise permitted by Section 5(b) below, deliver to the Company a personal
check equal to the exercise price. The Company shall deliver or cause to be
delivered to the Optionee a certificate for the number of shares then being
purchased by him or her. If any law or applicable regulation of the Securities
and Exchange Commission or other body having jurisdiction in the premises shall
require the Company or Optionee to take any action in connection with shares
being purchased upon exercise of the Option, exercise of the Option and delivery
of the certificate or certificates for such shares shall be postponed until
completion of the necessary action, which shall be taken at the Company's
expense. Whenever shares are to be issued in satisfaction of an Option granted
hereunder, the Company shall have the right to require the Optionee to remit to
the Company an amount sufficient to satisfy federal, state and local withholding
tax requirements prior to the delivery of any certificate or certificates for
such shares, if and to the extent required by law. The Option shall be reduced
by one share for each share of the Stock purchased upon exercise of the Option.
(b) In lieu of enclosing a personal check together with the written notice
of exercise as described in Section 5(a) above, the Optionee, if at the time of
exercise he/she is not subject to the provisions of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder, may, unless prohibited by applicable law, elect to effect payment by
including with the written notice of exercise referred to in Section 5(a) above
irrevocable instructions to deliver for sale to a registered securities broker
acceptable to the Company a number of shares of Stock subject to the Option
being exercised sufficient, after brokerage commissions, to cover the aggregate
option price payable with respect to such shares and, if the Optionee further
elects, the Optionee's withholding obligations under Section 5(a) with respect
to such exercise, together with irrevocable instructions to such broker to sell
such shares and to remit directly to the Company such aggregate option price
and, if the Optionee has so elected, the amount of such withholding obligations.
The Company shall not be required to deliver to such securities broker any stock
certificate for such shares until it has received from the broker such aggregate
option price and, if the Optionee has so elected, the amount of such withholding
obligations.
6. Transfer of Option. During the lifetime of the Optionee, the Option
may be exercised only by the Optionee and then, except as otherwise provided in
Section 4, only if the Optionee has been continuously in the service as an
employee, director or consultant of the Company and/or one or more of its
Related Corporations from the Grant Date until the date 90 days before the date
of exercise. Except by will or by the laws of descent and distribution, the
Option and all rights granted hereunder may not be transferred, assigned,
pledged, or hypothecated (whether by operation of law or otherwise) and shall
not be subject to execution, attachment or similar process. Any attempted
transfer, attachment, pledge, hypothecation or other disposition of the Option
or of such rights contrary to the provisions hereof and the levy of any
attachment or similar process upon the Option or such rights, shall be void.
7. Capital Changes. In the event of any stock dividend payable in the
Stock or any split-up or contraction in the number of shares of the Stock, or
any reclassification or change of outstanding shares of the Stock, in each case
occurring after the date of this Agreement and prior to the exercise in full of
the Option, the number and kind of shares for which the Option may thereafter be
exercised and the exercise price shall be proportionately and appropriately
adjusted. Upon any consolidation or merger of the Company with or into another
company, or any sale or conveyance to another company or entity of the property
of the Company as a whole, or the dissolution or liquidation of the Company, the
Option shall terminate, but the Optionee shall have the right, immediately prior
to such event, to exercise the Option, to the extent then vested and not
theretofore exercised. No fraction of a share shall be purchasable or
deliverable, but in the event any adjustment of the number of shares covered by
the Option shall cause such number to include a fraction of a share, such
fraction shall be adjusted to the nearest smaller whole number of shares.
8. Reservation of Shares. The Company shall at all times during the term
of this Agreement reserve and keep available such number of shares of the Stock
as will be sufficient to satisfy the requirements of this Agreement and shall
pay all taxes, fees and expenses necessarily incurred by the Company in
connection with this Agreement and the issuance of Optioned Shares.
9. Limitation of Rights in Optioned Shares. The Optionee shall not be
deemed for any purpose to be a stockholder of the Company with respect to any of
the Optioned Shares except to the extent that the Option shall have been
exercised and, in addition, a stock certificate shall have been issued and
delivered to the Optionee. Any stock issued pursuant to the Option shall be
subject to all restrictions upon the transfer thereof which may be now or
hereafter imposed by the Certificate of Incorporation or By-laws of the Company.
10. Company's Powers. The existence of the Option shall not diminish the
right or power of the Company or its stockholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior preference
stock ahead of or affecting the Stock or the rights thereof, or dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceedings, whether of a
similar character or otherwise. The Option confers upon the Optionee no right
to continue in the service of the Company or its Related Corporations, nor
interferes in any way with the right of the Company and its Related Corporations
to terminate the employment, directorships and/or consultancies of the Optionee
at any time.
11. Notices. Any communication or notice required or permitted to be
given under this Agreement shall be in writing, and mailed by registered or
certified mail or delivered in hand, if to the Company, to its Treasurer at
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and, if to
the Optionee, to the address set forth on the first page of this Agreement, or
such other address, in each case, as the addressee shall last have furnished to
the communicating party.
12. Terms and Conditions of Plan. The option granted hereunder is subject
to all the terms and conditions set forth in the Company's Second Amended and
Restated 1991 Stock Option Plan, receipt of a copy of which is hereby
acknowledged by the Optionee.
13. Governing Law; Payment of Expenses: This Agreement shall be governed
by and construed in accordance with the internal and substantive laws of the
State of Delaware. The Company and the Optionee agree that, in connection with
any award entered by any court or arbitrator with respect to any dispute
relating to or arising out of this Agreement (including, without limitation, any
action brought by the Company to enforce the provisions of Section 4), the non-
prevailing party shall pay all of the prevailing party's reasonable costs,
including attorneys' fees (collectively, "Dispute Resolution Expenses"). In
rendering its judgment, decision, award, order, verdict and/or decree, the court
or arbitrator, as the case may be, shall provide for the payment by the non-
prevailing party of the prevailing party's Dispute Resolution Expenses.
Judgment upon an award rendered by an arbitrator may be entered in any court of
competent jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
CHEMFAB CORPORATION
By ___________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executive Vice President
___________________________
Optionee
Chemfab Corporation
NONSTATUTORY STOCK OPTION AGREEMENT
-----------------------------------
UNDER THE
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SECOND AMENDED AND RESTATED 1991 STOCK OPTION PLAN
--------------------------------------------------
DIRECTOR FORM
--------------
NONSTATUTORY STOCK OPTION AGREEMENT dated as of October 30, 1997 (this
"Agreement"), by and between Chemfab Corporation (the "Company"), and _________
________________________ presently residing at ________________________________
(the "Optionee").
WHEREAS, the Company's Second Amended and Restated 1991 Stock Option Plan,
as amended (the "Plan") provides that whenever a director is elected or re-
elected to the Board of Directors at an annual shareholders meeting or special
meeting in lieu of an annual meeting, or continues to serve as a director after
such meeting, that director is automatically granted certain nonstatutory stock
options;
WHEREAS, the Optionee has been elected or re-elected as a director of the
Company at an annual meeting of shareholders held on October 30, 1997;
NOW, THEREFORE, the parties agree as follows:
1. Optionee's Continued Service. Nothing herein contained shall be
deemed to confer upon the Optionee any right to continue as a director of the
Company nor to interfere in any way with the right of the Company to terminate
its relationship with the Optionee at any time.
2. Grant of Option. Subject to the terms and conditions set forth
herein, the Company has granted to the Optionee on October 30, 1997 (the "Grant
date") an option (the "Option") to purchase from the Company shares (the
"Optioned Shares") of the Company's common stock, par value $.10 per share (the
"Stock"). The Option shall become exercisable in four (4) equal installments,
of 25% each, on each of the following dates, but only if the Optionee remains a
director of the Company at that date:
Grant date: October 30, 1997
The last day of the Company's second fiscal quarter of fiscal year 1998
The last day of the Company's third fiscal quarter of fiscal year 1998
The last day of the Company's fourth fiscal quarter of fiscal year 1998
The Option must be exercised, if ever, before the tenth (10th) anniversary of
the Grant Date or within such shorter period as may result from the operation of
Section 4.
3. Exercise Price. The exercise price to be paid for the Optioned
Shares shall be per share.
4. Termination of Option: Disgorgement of Certain Profits. (a) If the
Optionee ceases to serve as a director of the Company for any reason, other than
death, the Option may be exercised, to the extent exercisable on the date of
such termination, by the Optionee at any time within 90 days after such
termination, but only before the tenth (10th) anniversary of the Grant Date. If
the Optionee dies, the Option may be exercised, to the extent exercisable on the
date of death, at any time by the Optionee's executor or administrator, but only
before the earlier of the first (1) anniversary of the date of death or the
tenth (10th) anniversary of the Grant Date. Options which are not exercisable
at the time of termination of the Optionee's relationship with the Company or
which are exercisable but not exercised within the time periods described above
shall terminate. A leave of absence for military service, illness or other bona
fide purpose shall not be deemed a termination for purposes of this Section 4
provided that it does not exceed the longer of ninety (90) days or the period
during which the rights of the absent director are guaranteed by statute or by
contract. If the Optionee does not so return, his relationship with the Company
shall be deemed to have ended on the next day of such leave of absence.
(b) The Optionee covenants and agrees with the Company that if, during the
twelve-month period following the cessation of an Optionee's employment with,
and/or directorship of, and/or consultancy for, the Company or any Related
Corporation, as the case may be, and regardless of the reason or absence of
reason for such cessation (the date of which cessation hereinafter, a "Cessation
Date"), said Optionee engages directly or indirectly in any business, activity
or enterprise which diverts business from, is in conflict with, causes a
competitive disadvantage to, or otherwise adversely affects the interests or
business of, the Company or any Related Corporation (each of the foregoing, a
"Disgorgement Event"), then the Optionee shall automatically owe to the Company,
and shall promptly and without demand pay to the Company, with respect to each
share of Stock issued to the Optionee upon the full or partial exercise of this
Option from and after that date which is nine (9) months prior to the Optionee's
Cessation Date, an amount equal to the excess of Market Value of such share on
the date of exercise over the Option Price paid by the Optionee for such share;
provided that, on a case by case basis, a majority of disinterested members of
the Board of Directors or the Committee may, in their sole discretion, waive
enforcement of this provision, in whole or in part; and provided further that no
such waiver shall be deemed a waiver of enforcement in any other instance.
(c) The Optionee agrees and acknowledges that, because of the nature and
purpose of the grant of this Option, and because of the Optionee's position
with, and access to information of, the Company and/or one or more Related
Corporations, the consequences described in Section 4(b) constitute essential
terms of and are inseparable from the other terms and conditions of this Option
and are necessary for the protection and benefit of the Company. The Optionee
further agrees and acknowledges that the extent of harm to the Company that
would be caused by the Optionee in the event of a Disgorgement Event is not now
and will not be, at such time, precisely determinable and that the Company would
be without an adequate remedy in the event of a Disgorgement Event caused by the
Optionee absent the provisions of this Section 4.
5. Exercise of Option. (a) The Optionee may exercise this Option by
giving written notice in the manner provided in Section 11. The notice shall
specify the number of shares of the Stock which the Optionee elects to purchase.
For all shares which the Optionee elects to purchase, the Optionee shall except
as otherwise permitted by Section 5(b) below, deliver to the Company a personal
check equal to the exercise price. The Company shall deliver or cause to be
delivered to the Optionee a certificate for the number of shares then being
purchased by him or her. If any law or applicable regulation of the Securities
and Exchange Commission or other body having jurisdiction in the premises shall
require the Company or Optionee to take any action in connection with shares
being purchased upon exercise of the Option, exercise of the Option and delivery
of the certificate or certificates for such shares shall be postponed until
completion of the necessary action, which shall be taken at the Company's
expense. The Option shall be reduced by one share for each share of the Stock
purchased upon exercise of the Option.
(b) In lieu of enclosing a personal check together with the written notice
of exercise as described in Section 5(a) above, the Optionee, if at the time of
exercise he/she is not subject to the provisions of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder, may, unless prohibited by applicable law, elect to effect payment by
including with the written notice of exercise referred to in Section 5(a) above
irrevocable instructions to deliver for sale to a registered securities broker
acceptable to the Company a number of shares of Stock subject to the Option
being exercised sufficient, after brokerage commissions, to cover the aggregate
option price payable with respect to such shares, together with irrevocable
instructions to such broker to sell such shares and to remit directly to the
Company such aggregate option price. The Company shall not be required to
deliver to such securities broker any stock certificate for such shares until it
has received from the broker such aggregate option price.
6. Transfer of Option. During the lifetime of the Optionee, the Option
may be exercised only by the Optionee and then, except as otherwise provided in
Section 4, only if the Optionee has continuously served as a director of the
Company from the Grant Date until the date 90 days before the date of exercise.
Except by will or by the laws of descent and distribution, the Option and all
rights granted hereunder may not be transferred, assigned, pledged, or
hypothecated (whether by operation of law or otherwise) and shall not be subject
to execution, attachment or similar process. Any attempted transfer,
attachment, pledge, hypothecation or other disposition of the Option or of such
rights contrary to the provisions hereof and the levy of any attachments or
similar process upon the Option or such rights, shall be void.
7. Capital Changes. In the event of any stock dividend payable in the
Stock or any split-up or contraction in the number of shares of the Stock, or
any reclassification or change of outstanding shares of the Stock, in each case
occurring after the date of this Agreement and prior to the exercise in full of
the Option, the number and kind of shares for which the Option may thereafter be
exercised and the exercise price shall be proportionately and appropriately
adjusted. Upon any consolidation or merger of the Company with or into another
company, or any sale or conveyance to another company or entity of the property
of the Company as a whole, or the dissolution or liquidation of the Company, the
Option shall terminate, but the Optionee shall have the right, immediately prior
to such event, to exercise the Option, to the extent then exercisable by its
terms and not theretofore exercised. No fraction of a share shall be
purchasable or deliverable, but in the event any adjustment of the number of
shares covered by the Option shall cause such number to include a fraction of a
share, such fraction shall be adjusted to the nearest smaller whole number of
shares.
8. Reservation of Shares. The Company shall at all times during the
term of this Agreement reserve and keep available such number of shares of the
Stock as will be sufficient to satisfy the requirements of this Agreement and
shall pay all taxes, fees and expenses necessarily incurred by the Company in
connection with this Agreement and the issuance of Optioned Shares.
9. Limitation of Rights in Optioned Shares. The Optionee shall have no
rights as a stockholder of the Company with respect to any of the Optioned
Shares except to the extent that the Option shall have been exercised, payment
as herein provided shall have been made in full, and a stock certificate shall
have been issued and delivered to the Optionee. Any stock issued pursuant to
the Option shall be subject to all restrictions upon the transfer thereof which
may be now or hereafter imposed by the Certificate of Incorporation or By-laws
of the Company.
10. Company's Powers. The existence of the Option shall not diminish
the right of power of the Company or its stockholders to make or authorize any
or all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior preference
stock ahead of or affecting the Stock or the rights thereof, or dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceedings, whether of a
similar character or otherwise.
11. Notices. Any communication or notice required to or permitted to be
given under this Agreement shall be in writing, and mailed by registered or
certified mail or delivered in hand, if to the Company, to its Treasurer at
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and, if to
the Optionee, to the address set forth on the first page of this Agreement, or
such other address, in each case, as the addressee shall last have furnished to
the communicating party.
12. Terms and Conditions of Plan. The option granted hereunder is
subject to all the terms and conditions set forth in the Plan, receipt of a copy
of which is hereby acknowledged by the Optionee.
13. Governing Law; Payment of Expenses: This Agreement shall be governed
by and construed in accordance with the internal and substantive laws of the
State of Delaware. The Company and the Optionee agree that, in connection with
any award entered by any court or arbitrator with respect to any dispute
relating to or arising out of this Agreement (including, without limitation, any
action brought by the Company to enforce the provisions of Section 4), the non-
prevailing party shall pay all of the prevailing party's reasonable costs,
including attorneys' fees (collectively, "Dispute Resolution Expenses"). In
rendering its judgment, decision, award, order, verdict and/or decree, the court
or arbitrator, as the case may be, shall provide for the payment by the non-
prevailing party of the prevailing party's Dispute Resolution Expenses.
Judgment upon an award rendered by an arbitrator may be entered in any court of
competent jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
CHEMFAB CORPORATION
By ________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executive Vice President
------------------------
Optionee
Chemfab Corporation
NONSTATUTORY STOCK OPTION AGREEMENT
-----------------------------------
UNDER THE
--------
SECOND AMENDED AND RESTATED 1991 STOCK OPTION PLAN
--------------------------------------------------
DIRECTOR CONSULTANT FORM
------------------------
NONSTATUTORY STOCK OPTION AGREEMENT dated October 30, 1997 (this
"Agreement"), between Chemfab Corporation (the "Company"), and ________________
presently residing at _____________________, _____________ (the "Optionee").
WHEREAS, the Option/Compensation Committee of the Board of Directors of the
Company has determined that it is to the advantage and interest of the Company
and its stockholders to grant to the Optionee the nonstatutory stock option
provided for herein as an inducement to provide and continue to provide
consulting services to the Company and its subsidiaries and as an incentive for
increased effort during such service; and
WHEREAS, the Optionee is engaged in the provision of consulting services to
the Company and/or its subsidiary corporations ("Related Corporations");
NOW, THEREFORE, the parties agree as follows:
1. Optionee's Continued Service. Nothing herein contained shall be deemed
to confer upon the Optionee any right to continue as a consultant the Company or
one or more of its Related Corporations in any particular capacity or in
general, nor to interfere in any way with the right of the relevant corporation
or corporations to terminate any employment, consultancies and/or directorship
of the Optionee at any time
2. Grant of Option. Subject to the terms and conditions set forth herein,
the Company has granted to the Optionee on October 30, 1997 (the "Grant Date")
an option (the "Option") to purchase from the Company shares (the
"Optioned Shares") of the Company's common stock, par value $.10 per share (the
"Stock"). The Option is not intended to be treated as an "incentive stock
option" within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), but as a nonstatutory stock option within the meaning
of the Code. On each of the following dates (each a "Vesting Date" and
collectively the "Vesting Dates"), but only if the Optionee remains both as a
director and a consultant of the Company or one or more Related Corporations at
such Vesting Date (with the status of any corporation as a Related Corporation
to be determined as of such Vesting Date), the stated number of shares shall
become purchasable hereunder:
Date Number of Shares
---- -----------------
October 30, 1997 (25%)
October 30, 1998 (25%)
October 30, 1999 (25%)
October 31, 2000 (25%)
The Option must be exercised, if ever, before the tenth anniversary of the Grant
Date or within such shorter period as may result from the operation of Section
4.
3. Exercise Price. The exercise price to be paid for the Optioned Shares
shall be per share.
4. Termination of Option; Disgorgement of Certain Profits. (a) If the
Optionee ceases to serve as a consultant and/or director to the Company and all
its Related for any reason, other than death, the Option, to the extent
exercisable on the date of such termination, may be exercised by the Optionee at
any time within 90 days after termination, but only before the tenth anniversary
of the Grant Date. If the Optionee dies, the Option may be exercised, to the
extent exercisable on the date of death, at any time by the Optionee or his
executor or administrator, as the case may be, but only before the earlier of
the first anniversary of the date of death or retirement or the tenth
anniversary of the Grant Date. Options which are not exercisable at the time of
termination of the Optionee's relationship with the Company and all its Related
Corporations as a director and/or consultant or which are so exercisable but are
not exercised within the time periods described above, shall terminate. Leave
of absence for military service, illness or other bona fide purpose shall not be
deemed a termination for purposes of this Section 4 provided that it does not
exceed the longer of 90 days or the period during which the absent Optionee's
rights are guaranteed by statute or by contract. If the Optionee does not so
return, his relationship with the Company and all its Related Corporations as an
employee, director and/or consultant shall be deemed to have ended on the next
day of such leave of absence.
(b) The Optionee covenants and agrees with the Company that if, during the
twelve-month period following the cessation of Optionee's directorship of,
and/or consultancy for, the Company or any Related Corporation, as the case may
be, and regardless of the reason or absence of reason for such cessation (the
date of which cessation hereinafter, a "Cessation Date"), said Optionee engages
directly or indirectly in any business, activity or enterprise which diverts
business from, is in conflict with, causes a competitive disadvantage to, or
otherwise adversely affects the interests or business of, the Company or any
Related Corporation (each of the foregoing, a "Disgorgement Event"), then the
Optionee shall automatically owe to the Company, and shall promptly and without
demand pay to the Company, with respect to each share of Stock issued to the
Optionee upon the full or partial exercise of this Option from and after that
date which is nine (9) months prior to the Optionee's Cessation Date, an amount
equal to the excess of Market Value of such share on the date of exercise over
the Option Price paid by the Optionee for such share; provided that, on a case
by case basis, a majority of disinterested members of the Board of Directors or
the Committee may, in their sole discretion, waive enforcement of this
provision, in whole or in part; and provided further that no such waiver shall
be deemed a waiver of enforcement in any other instance.
(c) The Optionee agrees and acknowledges that, because of the nature and
purpose of the grant of this Option, and because of the Optionee's position
with, and access to information of, the Company and/or one or more Related
Corporations, the consequences described in Section 4(b) constitute essential
terms of and are inseparable from the other terms and conditions of this Option
and are necessary for the protection and benefit of the Company. The Optionee
further agrees and acknowledges that the extent of harm to the Company that
would be caused by the Optionee in the event of a Disgorgement Event is not now
and will not be, at such time, precisely determinable and that the Company would
be without an adequate remedy in the event of a Disgorgement Event caused by the
Optionee absent the provisions of this Section 4.
5. Exercise of Option. (a) The Optionee may exercise the Option by giving
written notice in the manner provided in Section 11. The notice shall specify
the number of shares of the Stock which the Optionee elects to purchase. For
all shares which the Optionee elects to purchase, the Optionee shall except as
otherwise permitted by Section 5(b) below, deliver to the Company a personal
check equal to the exercise price. The Company shall deliver or cause to be
delivered to the Optionee a certificate for the number of shares then being
purchased by him or her. If any law or applicable regulation of the Securities
and Exchange Commission or other body having jurisdiction in the premises shall
require the Company or Optionee to take any action in connection with shares
being purchased upon exercise of the Option, exercise of the Option and delivery
of the certificate or certificates for such shares shall be postponed until
completion of the necessary action, which shall be taken at the Company's
expense. Whenever shares are to be issued in satisfaction of an Option granted
hereunder, the Company shall have the right to require the Optionee to remit to
the Company an amount sufficient to satisfy federal, state and local withholding
tax requirements prior to the delivery of any certificate or certificates for
such shares, if and to the extent required by law. The Option shall be reduced
by one share for each share of the Stock purchased upon exercise of the Option.
(b) In lieu of enclosing a personal check together with the written notice
of exercise as described in Section 5(a) above, the Optionee, if at the time of
exercise he/she is not subject to the provisions of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder, may, unless prohibited by applicable law, elect to effect payment by
including with the written notice of exercise referred to in Section 5(a) above
irrevocable instructions to deliver for sale to a registered securities broker
acceptable to the Company a number of shares of Stock subject to the Option
being exercised sufficient, after brokerage commissions, to cover the aggregate
option price payable with respect to such shares and, if the Optionee further
elects, the Optionee's withholding obligations under Section 5(a) with respect
to such exercise, together with irrevocable instructions to such broker to sell
such shares and to remit directly to the Company such aggregate option price
and, if the Optionee has so elected, the amount of such withholding obligations.
The Company shall not be required to deliver to such securities broker any stock
certificate for such shares until it has received from the broker such aggregate
option price and, if the Optionee has so elected, the amount of such withholding
obligations.
6. Transfer of Option. During the lifetime of the Optionee, the Option
may be exercised only by the Optionee and then, except as otherwise provided in
Section 4, only if the Optionee has been continuously in the service as a
director and consultant of the Company and/or one or more of its Related
Corporations from the Grant Date until the date 90 days before the date of
exercise. Except by will or by the laws of descent and distribution, the Option
and all rights granted hereunder may not be transferred, assigned, pledged, or
hypothecated (whether by operation of law or otherwise) and shall not be subject
to execution, attachment or similar process. Any attempted transfer,
attachment, pledge, hypothecation or other disposition of the Option or of such
rights contrary to the provisions hereof and the levy of any attachment or
similar process upon the Option or such rights, shall be void.
7. Capital Changes. In the event of any stock dividend payable in the
Stock or any split-up or contraction in the number of shares of the Stock, or
any reclassification or change of outstanding shares of the Stock, in each case
occurring after the date of this Agreement and prior to the exercise in full of
the Option, the number and kind of shares for which the Option may thereafter be
exercised and the exercise price shall be proportionately and appropriately
adjusted. Upon any consolidation or merger of the Company with or into another
company, or any sale or conveyance to another company or entity of the property
of the Company as a whole, or the dissolution or liquidation of the Company, the
Option shall terminate, but the Optionee shall have the right, immediately prior
to such event, to exercise the Option, to the extent then vested and not
theretofore exercised. No fraction of a share shall be purchasable or
deliverable, but in the event any adjustment of the number of shares covered by
the Option shall cause such number to include a fraction of a share, such
fraction shall be adjusted to the nearest smaller whole number of shares.
8. Reservation of Shares. The Company shall at all times during the term
of this Agreement reserve and keep available such number of shares of the Stock
as will be sufficient to satisfy the requirements of this Agreement and shall
pay all taxes, fees and expenses necessarily incurred by the Company in
connection with this Agreement and the issuance of Optioned Shares.
9. Limitation of Rights in Optioned Shares. The Optionee shall not be
deemed for any purpose to be a stockholder of the Company with respect to any of
the Optioned Shares except to the extent that the Option shall have been
exercised and, in addition, a stock certificate shall have been issued and
delivered to the Optionee. Any stock issued pursuant to the Option shall be
subject to all restrictions upon the transfer thereof which may be now or
hereafter imposed by the Certificate of Incorporation or By-laws of the Company.
10. Company's Powers. The existence of the Option shall not diminish the
right or power of the Company or its stockholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior preference
stock ahead of or affecting the Stock or the rights thereof, or dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceedings, whether of a
similar character or otherwise. The Option confers upon the Optionee no right
to continue in the service of the Company or its Related Corporations, nor
interferes in any way with the right of the Company and its Related Corporations
to terminate the employment, directorships and/or consultancies of the Optionee
at any time.
11. Notices. Any communication or notice required or permitted to be
given under this Agreement shall be in writing, and mailed by registered or
certified mail or delivered in hand, if to the Company, to its Treasurer at
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and, if to
the Optionee, to the address set forth on the first page of this Agreement, or
such other address, in each case, as the addressee shall last have furnished to
the communicating party.
12. Terms and Conditions of Plan. The option granted hereunder is subject
to all the terms and conditions set forth in the Company's Second Amended and
Restated 1991 Stock Option Plan, receipt of a copy of which is hereby
acknowledged by the Optionee.
13. Governing Law; Payment of Expenses: This Agreement shall be governed
by and construed in accordance with the internal and substantive laws of the
State of Delaware. The Company and the Optionee agree that, in connection with
any award entered by any court or arbitrator with respect to any dispute
relating to or arising out of this Agreement (including, without limitation, any
action brought by the Company to enforce the provisions of Section 4), the non-
prevailing party shall pay all of the prevailing party's reasonable costs,
including attorneys' fees (collectively, "Dispute Resolution Expenses"). In
rendering its judgment, decision, award, order, verdict and/or decree, the court
or arbitrator, as the case may be, shall provide for the payment by the non-
prevailing party of the prevailing party's Dispute Resolution Expenses.
Judgment upon an award rendered by an arbitrator may be entered in any court of
competent jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
CHEMFAB CORPORATION
By ____________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executive Vice President
____________________________
Optionee
Chemfab Corporation
NONSTATUTORY STOCK OPTION AGREEMENT
-----------------------------------
UNDER THE
--------
SECOND AMENDED AND RESTATED 1991 STOCK OPTION PLAN
--------------------------------------------------
NONSTATUTORY STOCK OPTION AGREEMENT dated October 30, 1997 (this
"Agreement"), between Chemfab Corporation (the "Company"), and
presently residing at , (the
"Optionee").
WHEREAS, the Stock Option Committee of the Board of Directors of the
Company has determined that it is to the advantage and interest of the Company
and its stockholders to grant to the Optionee the nonstatutory stock option
provided for herein as an inducement to remain in the service of the Company and
its subsidiaries and as an incentive for increased effort during such service;
and
WHEREAS, the Optionee is engaged in the service of the Company and its
subsidiary corporations ("Related Corporations");
NOW, THEREFORE, the parties agree as follows:
1. Optionee's Continued Employment. The Optionee shall remain
continuously (subject to the exception in Section 4) in the employ of the
Company or one or more of its Related Corporations for a period of at least one
year from the Grant Date and shall, during such employment, devote his or her
time, energy and skill to the service of the Company or one or more of its
Related Corporations. Nothing herein contained shall be deemed to confer upon
the Optionee any right to continue in the employ of the Company or one or more
of its Related Corporations nor to interfere in any way with the right of the
employing corporation or corporations to terminate the employment of the
Optionee at any time. If the Optionee's employment with the Company and all of
its Related Corporations shall terminate within one year from the Grant Date,
the Optionee shall have no rights whatsoever under this Agreement.
2. Grant of Option. Subject to the terms and conditions set forth herein,
the Company has granted to the Optionee on August 5, 1997 (the "Grant Date") an
option (the "Option") to purchase from the Company shares (the
"Optioned Shares") of the Company's common stock, par value $.10 per share (the
"Stock"). The Option is not intended to be treated as an "incentive stock
option" within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), but as a nonstatutory stock option within the meaning
of the Code. On each of the following dates, but only if the Optionee remains
an employee of the Company or a Related Corporation at that date (with the
status of any Corporation as a Related Corporation to be determined as of that
date), the stated number of shares shall become purchasable hereunder:
Date Number of Shares
-------- ----------------
August 5, 1998 . (25%)
August 5, 1999 . (25%)
August 5, 2000 . (25%)
August 5, 2001 . (25%)
The Option must be exercised, if ever, before the tenth anniversary of the Grant
Date or within such shorter period as may result from the operation of Section
4.
3. Exercise Price. The exercise price to be paid for the Optioned Shares
shall be per share.
4. Termination of Option; Disgorgement of Certain Profits. (a) If the
Optionee's employment by the Company and its Related Corporations terminates for
any reason, other than death or retirement (but including termination of
affiliation between the Company and the Related Corporation with which Optionee
is serving as an employee), after the first anniversary of the Grant Date, the
Option, to the extent exercisable on the date of such termination, may be
exercised by the Optionee at any time within 90 days after termination, but only
before the tenth anniversary of the Grant Date. If the Optionee dies or retires
after the first anniversary of the Grant Date, the Option may be exercised, to
the extent exercisable on the date of retirement or death, at any time by the
Optionee or his executor or administrator, as the case may be, but only before
the earlier of the first anniversary of the date of death or retirement or the
tenth anniversary of the Grant Date. Options which are not exercisable at the
time of termination of the Optionee's employment or which are so exercisable but
are not exercised within the time periods described above shall terminate.
Leave of absence for military service, illness or other bona fide purpose shall
not be deemed a termination of employment provided that it does not exceed the
longer of 90 days or the period during which the absent employee's reemployment
rights are guaranteed by statute or by contract. If the Optionee does not so
return, his employment shall be deemed to have ended on the next day of such
leave of absence.
(b) The Optionee covenants and agrees with the Company that if, during the
twelve-month period following the cessation of an Optionee's employment with,
and/or directorship of, and/or consultancy for, the Company or any Related
Corporation, as the case may be, and regardless of the reason or absence of
reason for such cessation (the date of which cessation hereinafter, a "Cessation
Date"), said Optionee engages directly or indirectly in any business, activity
or enterprise which diverts business from, is in conflict with, causes a
competitive disadvantage to, or otherwise adversely affects the interests or
business of, the Company or any Related Corporation (each of the foregoing, a
"Disgorgement Event"), then the Optionee shall automatically owe to the Company,
and shall promptly and without demand pay to the Company, with respect to each
share of Stock issued to the Optionee upon the full or partial exercise of this
Option from and after that date which is nine (9) months prior to the Optionee's
Cessation Date, an amount equal to the excess of Market Value of such share on
the date of exercise over the Option Price paid by the Optionee for such share;
provided that, on a case by case basis, a majority of disinterested members of
the Board of Directors or the Committee may, in their sole discretion, waive
enforcement of this provision, in whole or in part; and provided further that no
such waiver shall be deemed a waiver of enforcement in any other instance.
(c) The Optionee agrees and acknowledges that, because of the nature and
purpose of the grant of this Option, and because of the Optionee's position
with, and access to information of, the Company and/or one or more Related
Corporations, the consequences described in Section 4(b) constitute essential
terms of and are inseparable from the other terms and conditions of this Option
and are necessary for the protection and benefit of the Company. The Optionee
further agrees and acknowledges that the extent of harm to the Company that
would be caused by the Optionee in the event of a Disgorgement Event is not now
and will not be, at such time, precisely determinable and that the Company would
be without an adequate remedy in the event of a Disgorgement Event caused by the
Optionee absent the provisions of this Section 4.
5. Exercise of Option. (a) The Optionee may exercise the Option by giving
written notice in the manner provided in Section 11. The notice shall specify
the number of shares of the Stock which the Optionee elects to purchase. For
all shares which the Optionee elects to purchase, the Optionee shall except as
otherwise permitted by Section 5(b) below, deliver to the Company a personal
check, equal to the exercise price. The Company shall deliver or cause to be
delivered to the Optionee a certificate for the number of shares then being
purchased by him or her. If any law or applicable regulation of the Securities
and Exchange Commission or other body having jurisdiction in the premises shall
require the Company or Optionee to take any action in connection with shares
being purchased upon exercise of the Option, exercise of the Option and delivery
of the certificate or certificates for such shares shall be postponed until
completion of the necessary action, which shall be taken at the Company's
expense. Whenever shares are to be issued in satisfaction of an Option granted
hereunder, the Company shall have the right to require the Optionee to remit to
the Company an amount sufficient to satisfy federal, state and local withholding
tax requirements prior to the delivery of any certificate or certificates for
such shares, if and to the extent required by law. The Option shall be reduced
by one share for each share of the Stock purchased upon exercise of the Option.
(b) In lieu of enclosing a personal check together with the written notice
of exercise as described in Section 5(a) above, the Optionee may, unless
prohibited by applicable law, elect to effect payment by including with the
written notice of exercise referred to in Section 5(a) above irrevocable
instructions to deliver for sale to a registered securities broker acceptable
to the Company a number of shares of Stock subject to the Option being exercised
sufficient, after brokerage commissions, to cover the aggregate option price
payable with respect to such shares and, if the Optionee further elects, the
Optionee's withholding obligations under Section 5(a) with respect to such
exercise, together with irrevocable instructions to such broker to sell such
shares and to remit directly to the Company such aggregate option price and, if
the Optionee has so elected, the amount of such withholding obligations. The
Company shall not be required to deliver to such securities broker any stock
certificate for such shares until it has received from the broker such aggregate
option price and, if the Optionee has so elected, the amount of such withholding
obligations.
6. Transfer of Option. During the lifetime of the Optionee, the Option
may be exercised only by the Optionee and then, except as otherwise provided in
Section 4, only if the Optionee has been continuously in the full time employ of
the Company and/or one or more of its Related Corporations from the Grant Date
until the date 90 days before the date of exercise. Except by will or by the
laws of descent and distribution, the Option and all rights granted hereunder
may not be transferred, assigned, pledged, or hypothecated (whether by operation
of law or otherwise) and shall not be subject to execution, attachment or
similar process. Any attempted transfer, attachment, pledge, hypothecation or
other disposition of the Option or of such rights contrary to the provisions
hereof and the levy of any attachment or similar process upon the Option or such
rights, shall be void.
7. Capital Changes. In the event of any stock dividend payable in the
Stock or any split-up or contraction in the number of shares of the Stock, or
any reclassification or change of outstanding shares of the Stock, in each case
occurring after the date of this Agreement and prior to the exercise in full of
the Option, the number and kind of shares for which the Option may thereafter be
exercised and the exercise price shall be proportionately and appropriately
adjusted. Upon any consolidation or merger of the Company with or into another
company, or any sale or conveyance to another company or entity of the property
of the Company as a whole, or the dissolution or liquidation of the Company, the
Option shall terminate, but the Optionee shall have the right, immediately prior
to such event, to exercise the Option, to the extent then vested and not
theretofore exercised. No fraction of a share shall be purchasable or
deliverable, but in the event any adjustment of the number of shares covered by
the Option shall cause such number to include a fraction of a share, such
fraction shall be adjusted to the nearest smaller whole number of shares.
8. Reservation of Shares. The Company shall at all times during the term
of this Agreement reserve and keep available such number of shares of the Stock
as will be sufficient to satisfy the requirements of this Agreement and shall
pay all taxes, fees and expenses necessarily incurred by the Company in
connection with this Agreement and the issuance of Optioned Shares.
9. Limitation of Rights in Optioned Shares. The Optionee shall not be
deemed for any purpose to be a stockholder of the Company with respect to any of
the Optioned Shares except to the extent that the Option shall have been
exercised and, in addition, a stock certificate shall have been issued and
delivered to the Optionee. Any stock issued pursuant to the Option shall be
subject to all restrictions upon the transfer thereof which may be now or
hereafter imposed by the Certificate of Incorporation or By-laws of the Company.
10. Company's Powers. The existence of the Option shall not diminish the
right or power of the Company or its stockholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior preference
stock ahead of or affecting the Stock or the rights thereof, or dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceedings, whether of a
similar character or otherwise. The Option confers upon the Optionee no right
to continue in the employment of the Company and its Related Corporations or
interferes in any way with the right of the Company and its Related Corporations
to terminate the employment of the Optionee at any time.
11. Notices. Any communication or notice required or permitted to be
given under this Agreement shall be in writing, and mailed by registered or
certified mail or delivered in hand, if to the Company, to its Treasurer at
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and, if to
the Optionee, to the address set forth on the first page of this Agreement, or
such other address, in each case, as the addressee shall last have furnished to
the communicating party.
12. Terms and Conditions of Plan; Shareholder Approval. The option
granted hereunder is subject to all the terms and conditions set forth in the
Company's Second Amended and Restated 1991 Stock Option Plan, receipt of a copy
of which is hereby acknowledged by the Optionee.
13. Governing Law; Payment of Expenses: This Agreement shall be governed
by and construed in accordance with the internal and substantive laws of the
State of Delaware. The Company and the Optionee agree that, in connection with
any award entered by any court or arbitrator with respect to any dispute
relating to or arising out of this Agreement (including, without limitation, any
action brought by the Company to enforce the provisions of Section 4), the non-
prevailing party shall pay all of the prevailing party's reasonable costs,
including attorneys' fees (collectively, "Dispute Resolution Expenses"). In
rendering its judgment, decision, award, order, verdict and/or decree, the court
or arbitrator, as the case may be, shall provide for the payment by the non-
prevailing party of the prevailing party's Dispute Resolution Expenses.
Judgment upon an award rendered by an arbitrator may be entered in any court of
competent jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
CHEMFAB CORPORATION
By _________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executive Vice President
_________________________
Optionee