Exhibit 10.6.1
1996 - OPTION NO. [OPTION_NO.]
RPM INTERNATIONAL INC.
1996 KEY EMPLOYEES STOCK OPTION PLAN
STOCK OPTION AGREEMENT*
THIS STOCK OPTION AGREEMENT, entered into as of this ____ day of
____________ , 20__, by and between RPM International Inc. (the "Company"), a
Delaware corporation and successor to RPM, Inc. under the RPM International Inc.
1996 Key Employees Stock Option Plan (the "Plan"), and [Name] (the "Optionee").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has designated the
Compensation Committee of the Board of Directors (the "Committee") to serve as
the Committee to administer the RPM International Inc. 1996 Key Employees Stock
Option Plan (the "Plan"); and
WHEREAS, the Committee has determined that the Optionee, as a Key
Employee, should be granted a stock option under the Plan upon the terms and
conditions set forth in this Agreement, and for the number of shares of Common
Stock, par value $0.01 per share (the "Shares"), of the Company set forth
hereinafter;
NOW, THEREFORE, the Company and the Optionee hereby agree as follows:
1. Definitions. Capitalized terms shall have the meanings set forth in
the Plan (as defined below) unless otherwise specifically set forth below or
elsewhere herein:
(a) The word "Agreement" shall mean this instrument.
(b) The word "Code" shall mean the United States Internal
Revenue Code of 1986, as amended, or successor
provisions of future United States revenue laws
(Title 26 of the United States Code).
(c) The words "Incentive Stock Option" shall mean any
Option which qualifies as an Incentive Stock Option
under terms of Section 422 of the Code.
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* PARAGRAPH 5 OF THIS AGREEMENT CONTAINS INFORMATION REGARDING THE EXERCISE
PERIOD FOR INCENTIVE STOCK OPTION GRANTS UPON CESSATION OF EMPLOYMENT WITH
THE COMPANY BY REASON OF NORMAL RETIREMENT (AS DEFINED HEREIN). FAILURE TO
COMPLY WITH THE EXERCISE PERIOD LIMITATION DESCRIBED THEREIN WILL HAVE THE
EFFECT OF DISQUALIFYING ANY SUCH OPTION AS AN INCENTIVE STOCK OPTION.
(d) The word "Option" shall mean the right and option of
the Optionee to purchase Shares pursuant to the terms
of this Agreement.
(e) The words "Option Price" shall mean the price at
which Shares may be acquired upon the exercise of any
Option.
(f) The words "Personal Representative" shall mean,
following the Optionee's death, such person or
persons who shall have acquired, by Will or by the
laws of descent and distribution, the right to
exercise any Option.
(g) The word "Plan" shall mean the RPM International Inc.
1996 Key Employees Stock Option Plan, as amended from
time to time, and in effect on the date of this
Agreement (a copy of which is attached as Exhibit A).
2. Grant of Option. Effective as of the date of this Agreement, the
Company grants to the Optionee, upon the terms and conditions set forth
hereinafter, the right and option to purchase all or any number of an aggregate
of [Total] ([Total_No]) Shares. The number of Shares subject to an Incentive
Stock Option, the number of Shares subject to a non-qualified stock option, and
the respective Option Prices are as set forth below:
(a) [ISO_Total] ([ISO_No]) Shares shall be subject to an
Incentive Stock Option at an Option Price of $16.125
per share; and
(b) [NQ_Total] ([NQ_NO]) Shares shall be subject to a
non-qualified stock option at an Option Price of
$16.125 per share.
3. Term of Option. The term of the Option shall be for a period of ten
(10) years from the date hereof, and the Option shall expire at the close of
regular business hours at the Company's principal office in Medina, Ohio, on the
last day of the term of the Option, or, if earlier, on the applicable expiration
date provided for in Sections 5 and 6 hereof.
4. Exercise Dates. Except as provided in Sections 5, 6 and 8 hereof,
the Option shall not be exercisable to any extent until one (1) year from the
date hereof. The Optionee shall be entitled to exercise the Option with respect
to the number of Shares indicated below on or after the date indicated opposite
such number below:
(a) Number of Shares as to Date as of
Which Incentive Stock Which Option
Option May Be Exercised May Be Exercised
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[ISO1999] July 15, 1999
[ISO2000] July 15, 2000
[ISO2001] July 15, 2001
[ISO2002] July 15, 2002
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(b) Number of Shares as to Date as of
Which Non-Qualified Stock Which Option
Option May Be Exercised May Be Exercised
----------------------- ----------------
[NQ1999] July 15, 1999
[NQ2000] July 15, 2000
[NQ2001] July 15, 2001
[NQ2002] July 15, 2002
To the extent that the Option becomes exercisable with respect to any Shares, as
provided above, the Option may thereafter be exercised by the Optionee either as
to all or any number of such Shares at any time or from time to time prior to
the expiration of the Option pursuant to Section 3 hereof. Except as provided in
Sections 5 and 6 hereof, the Option may not be exercised at any time unless the
Optionee shall be an employee at such time.
5. Termination of Employment, Etc. So long as the Optionee shall
continue to be an employee of the Company or one of its subsidiaries, the Option
shall not be affected by (a) any temporary leave of absence approved in writing
by the Company or one of its subsidiaries, or (b) any change of duties or
position (including transfer to or from a subsidiary). If the Optionee ceases to
be an employee of the Company or one of its subsidiaries for any reason other
than death or Normal Retirement (as defined below), the Option may be exercised
only to the extent of the purchase rights, if any, which had accrued as of the
date of such cessation pursuant to Section 4 hereof and which have not
theretofore been exercised; provided, however, that upon written request to the
Committee it may in its absolute discretion determine (but shall not be under
any obligation to determine) that such accrued purchase rights shall be deemed
to include additional Shares covered by the Option. Upon any such cessation of
employment by reason of discharge, such accrued purchase rights shall in any
event terminate upon the earlier of the date thirty (30) days from the date of
such cessation of employment or the last day of the term of the Option. Upon any
such cessation of employment by reason of a voluntary quit, such accrued
purchase rights shall terminate on the date of such cessation of employment.
Upon any such cessation of employment by reason of the voluntary retirement of
an employee who is at least 55 years of age and who has completed at least five
consecutive years of service with the Company and/or its subsidiaries ("Normal
Retirement"), the Optionee shall have the immediate right and option
(notwithstanding the provisions of Section 4 hereof) to exercise the Option with
respect to all of the Shares covered by the Option. Upon any such "Normal
Retirement," the purchase rights shall terminate upon the earlier of three (3)
years from the date of such cessation of employment or the last day of the term
of the Option; provided, however, that, IN THE CASE OF AN INCENTIVE STOCK
OPTION, THE OPTION MUST BE EXERCISED IN FULL WITHIN THREE (3) MONTHS AFTER
CESSATION OF EMPLOYMENT OR SUCH OPTION WILL NO LONGER QUALIFY AS AN INCENTIVE
STOCK OPTION AND SHALL THEREAFTER BE, AND RECEIVE THE TAX TREATMENT APPLICABLE
TO, A NON-QUALIFIED STOCK OPTION. In no event shall any employee who is
terminated by the Company, with or without cause, qualify for the "Normal
Retirement" provisions described in this Section 5. Nothing contained in this
Agreement shall confer upon the Optionee any right to continue in the employ of
the Company or any of its subsidiaries, or to
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limit or interfere in any way with the right of the Company or any such
subsidiary to terminate his or her employment at any time, with or without
cause.
6. Death of Optionee. If the Optionee dies while an employee or within
thirty (30) days of the Optionee's having ceased to be an employee by reason of
discharge, the Optionee's Personal Representative shall have the immediate right
and option (notwithstanding the provisions of Section 4 hereof) to exercise the
Option with respect to all Shares covered by the Option. Such purchase rights
shall in any event terminate upon the earlier of the date one (1) year from the
date of the Optionee's cessation of employment by reason of discharge or death
or the last day of the term of the Option
7. Limitations on Exercise of Incentive Stock Option. Notwithstanding
the foregoing, any Incentive Stock Option granted pursuant to this Agreement is
exercisable only to the extent that the aggregate fair market value (determined
at the time such Incentive Stock Option is granted) of the shares with respect
to which such Incentive Stock Options first become exercisable during any
calendar year does not exceed $100,000 (the "$100,000 Exercise Limitation");
provided, however, that (a) if the aggregate fair market value of the shares
with respect to which such Incentive Stock Options first became exercisable
exceeds the $100,000 Exercise Limitation as a result of the accelerated vesting
of the Option pursuant to Sections 5 or 6 hereof, the maximum number of whole
shares with an aggregate fair market value not in excess of $100,000 shall be
treated as shares issued pursuant to an Incentive Stock Option and the remaining
aggregate fair market value in excess of such amount shall be treated as shares
issued pursuant to a non-qualified stock option and (b) the $100,000 Exercise
Limitation shall not apply if the Option no longer qualifies as an Incentive
Stock Option as a result of the failure of the Optionee to exercise the Option
within the three (3) month period contained in Section 5 hereof.
8. Change of Control. In the event of a "change in control" as defined
in the Plan and as determined by the Committee, the Optionee shall have the
immediate right and option (notwithstanding the provisions of Section 4 hereof)
to exercise the Option with respect to all Shares covered by the Option.
9. Exercise of Option. The Option may be exercised by delivery to the
Secretary of the Company at its principal office, 2628 Pearl Road, P.O. Box 777,
Medina, Ohio 44258, of a completed Notice of Exercise of Option (obtainable from
the Secretary of the Company) setting forth the number of Shares with respect to
which the Option is being exercised, together with either a certified or
cashier's check payable to the Company or certificates for RPM International
Inc. Common Stock, par value $0.01 per share, properly endorsed for transfer, or
a combination thereof, in the amount of the total purchase price of such Shares.
10. Issuance of Share Certificates. Upon receipt by the Company prior
to expiration of the Option of a duly completed Notice of Exercise of Option
accompanied by a certified or cashier's check, or properly endorsed certificates
for RPM International Inc. Common Stock, par value $0.01 per share, as provided
in Section 9 hereof, in full payment for the Shares being purchased pursuant to
such Notice (and, with respect to any Option exercised pursuant to Section 6
hereof by the Personal Representative, accompanied in addition by proof
satisfactory to the
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Committee of the right of the Personal Representative to exercise the Option),
the Company shall cause to be mailed or otherwise delivered to the Optionee or
the Personal Representative, as the case may be, within thirty (30) days of such
receipt, a certificate or certificates for the number of Shares so purchased.
The Optionee or the Personal Representative shall not have any of the rights of
a shareholder with respect to the Shares covered by the Option unless and until
one or more certificates representing such Shares shall be issued to the
Optionee or the Personal Representative.
11. Successors in Interest, Etc. This Agreement shall be binding upon
and inure to the benefit of any successor or successors of the Company and the
heirs, estate, and Personal Representatives of the Optionee. The Option shall
not be transferable other than by Will or the laws of descent and distribution,
and the Option may be exercised during the lifetime of the Optionee only by the
Optionee or his guardian or legal representative. A deceased Optionee's Personal
Representative shall act in the place and stead of the deceased Optionee with
respect to exercising an Option or taking any other action pursuant to this
Agreement.
12. Provisions of Plan Control. This Agreement is subject to all of the
terms, conditions, and provisions of the Plan, as amended from time to time, and
to such rules, regulations, and interpretations relating to the Plan as may be
adopted by the Committee and in effect from time to time. A copy of the Plan is
attached hereto as Exhibit "A" and is incorporated herein by reference. In the
event and to the extent that this Agreement conflicts or is inconsistent with
the terms, conditions, and provisions of the Plan, the Plan shall control, and
this Agreement shall be deemed to be modified accordingly.
13. No Liability Upon Distribution of Shares. The liability of the
Company under this Agreement and any distribution of Shares made hereunder is
limited to the obligations set forth herein with respect to such distribution
and no term or provision of this Agreement shall be construed to impose any
liability on the Company or the Committee in favor of any person with respect to
any loss, cost or expense which the person may incur in connection with or
arising out of any transaction in connection with this Agreement.
14. Withholding. The Optionee agrees that the Company may make
appropriate provision for tax withholding with respect to the transactions
contemplated by this Agreement including such withholding as may be appropriate
with respect to any disqualifying disposition of an Incentive Stock Option.
15. Notice of Disqualifying Disposition. Optionee agrees that if he
should dispose of any Shares acquired upon the exercise of an Incentive Stock
Option, including a disposition by sale, exchange, gift or transfer of legal
title within two (2) years after the date such Option was granted to the
Optionee or within one (1) year after the transfer of such Shares to the
Optionee upon the exercise of such Option, the Optionee shall notify the Company
within three (3) days after such disposition.
16. 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.
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17. Number. The use of the singular or plural herein shall not be
restrictive as to number and shall be interpreted in all cases as the context
shall require.
18. Gender. The use of the feminine, masculine or neuter pronoun shall
not be restrictive as to gender and shall be interpreted in all cases as the
context may require.
19. Investment Representation. Optionee hereby represents and warrants
that any Shares which he may acquire by virtue of the exercise of the Option
shall be acquired for investment purposes only and not with a view to
distribution or resale; provided, however, that this restriction shall become
inoperative in the event the Shares which are subject to the Option shall be
registered under the Securities Act of 1933, as amended, or in the event there
is presented to the Company an opinion of counsel satisfactory to the Company to
the effect that the offer or sale of the Shares which are subject to the Option
may lawfully be made without registration under the Securities Act of 1933, as
amended.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed on its behalf by its duly authorized officer, and the Optionee has
hereunto set his hand, all as of the day and year first above written.
RPM INTERNATIONAL INC.
("Company")
By
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Its Chairman of the Board
[Name]
---------------------------------
("Optionee")
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