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Exhibit 10(q)
THE ALLEN GROUP INC.
NON-QUALIFIED OPTION TO PURCHASE STOCK
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Number of Shares ______________ ______________, 19__
THE ALLEN GROUP INC., a Delaware corporation (hereinafter called the
"Company"), hereby awards unto _____________________ (hereinafter called the
"Director") a non-qualified option to purchase _______ shares of Common Stock,
par value $1.00 per share, of the Company ("Common Stock") held in the Company's
treasury, at a price of $________ per share, on the terms and subject to the
conditions hereinafter set forth:
1. The number of shares and purchase price are subject to adjustment
as provided in paragraph 8 hereof.
2. This option shall expire on the tenth anniversary of the date
hereof and shall be exercisable 33 1/3 percent after the first anniversary of
the date hereof, 66 2/3 percent after the second anniversary of the date hereof
and 100 percent after the third anniversary of the date hereof. Notwithstanding
the foregoing, upon the death of the Director at any time prior to the tenth
anniversary of the date hereof, or upon the cessation of the Director's service
as a director of the Company six months or more after the date hereof and prior
to the tenth anniversary of the date hereof, this option shall become
immediately exercisable.
3. (a) If the Director shall cease to serve as a director of the
Company at any time six months or more after the date hereof, for any reason
other than death, this option may be exercised within three months after such
cessation. In the event of the Director's death within such three-month period
or if the cessation of the Director's service as director shall have been due to
his or her death, this option may be exercised at any time within one year after
the Director's death by his or her executor or administrator or by the
distributee to whom this option may have been transferred by will or by the laws
of descent and distribution.
(b) Notwithstanding anything to the contrary contained herein, if
upon the Director's cessation of service, the Director is or becomes an employee
or a senior management consultant to the Company and/or its subsidiaries, this
option may be exercised by the Director during the period ending on the earliest
of (i) the ninetieth (90th) day following the date that the Director permanently
ceases to render employment or consulting services to the Company and/or its
subsidiaries, for any reason other than cessation by reason of death, or (ii)
the date that is one year after the date described in clause (i) if the Director
ceases to render employment or consulting services on account of his or her
death (in which case the option may be exercised by the Director's executor or
administrator or by the distributee to whom this option may have been
transferred by will or by the laws of descent and distribution).
(c) Except as permitted by this paragraph 3, no option shall be
exercisable after the date of cessation of the Director's service as a director
of the Company. Anything herein to the contrary notwithstanding, this option may
in no event be exercised after the tenth anniversary of the date hereof.
4. During the lifetime of the Director, this option is exercisable
only by the Director, and neither this option nor any right or privilege
pertaining hereto may be transferred, assigned, pledged or hypothecated in any
way, by operation of law or otherwise, and shall not be subject to execution,
attachment or similar process. Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this option or any right or privilege
pertaining hereto, otherwise than by will or by the laws of descent and
distribution, or upon the levy of any execution, attachment or similar process
thereupon, this option and all rights and privileges given hereby shall
immediately become null and void.
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5. Subject to the conditions set forth herein, this option may be
exercised only by the execution and delivery by the Director (or any person
entitled to act under paragraph 3 hereof), to the Company of a written notice of
exercise in the form attached hereto as EXHIBIT A (with appropriate changes in
the case of a deceased Director), specifying the number of shares to be
purchased and accompanied by payment in full for the shares purchased, either
(a) in cash; (b) by the delivery of such number of shares of the Company's
Common Stock multiplied by the last sale price of such Common Stock as reported
on the New York Stock Exchange Composite Tape on the day such notice is received
by the Company (or if no sale of such Common Stock shall have been made on such
Exchange on that date, on the next preceding day on which there was a sale)
which equals the option price stated in this option multiplied by the number of
shares subject to that portion of this option in respect of which such notice
shall be given; or (c) any combination of cash and shares of the Company's
Common Stock valued as of the date and in the manner provided in (b) above. No
fractional share of Common Stock shall be issued or transferred, and any such
fractional share resulting from an adjustment pursuant to paragraphs 1 and 8
hereof shall be eliminated.
6. The Company shall, upon payment of the exercise price per share
for the number of shares purchased and paid for, make prompt delivery of a
certificate evidencing such shares to the Director (or his or her executor,
administrator or distributee pursuant to paragraph 3 hereof).
7. It shall be a condition to the obligation of the Company to issue
or transfer shares of Common Stock upon the exercise of this option, whether
such purchase price is paid in shares of Common Stock or cash, that the Director
(or any person entitled to act under paragraph 3 hereof) pay to the Company,
upon its demand, such amount as may be requested by the Company for the purpose
of satisfying its liability, if any, to withhold federal, state or local income
or other taxes incurred by the Company by reason of the exercise of this option.
If the amount requested is not paid, the Company may refuse to issue or transfer
shares of Common Stock upon exercise of this option.
8. The Company shall make or provide for such adjustments in the
option price and in the number or kind of shares or other securities covered by
this option as the Company in its sole discretion, exercised in good faith,
shall determine is equitably required to prevent dilution or enlargement of
rights of the Director that would otherwise result from (a) any stock dividend,
stock split, combination of shares, issuance of rights or warrants to purchase
stock, recapitalization or other changes in the capital structure of the
Company, (b) any merger, consolidation, reorganization or partial or complete
liquidation, or (c) any other corporate transaction or event having an effect
similar to any of the foregoing. The Company also shall make or provide for such
adjustments in the number or kind of shares of the Company's Common Stock or
other securities which may be acquired pursuant to this option and the number of
such securities to be awarded to the Director as the Company in its sole
discretion, exercised in good faith, shall determine is appropriate to reflect
any transaction or event described in the preceding sentence. The determination
of the Company as to what adjustments shall be made, and the extent thereof,
shall be final, binding and conclusive.
9. The exercise of this option, and the Company's obligation to
accept, sell and deliver shares of Common Stock pursuant to any such exercise,
shall be subject to all applicable federal and state laws, rules and regulations
and to such approvals by any regulatory or government agency as may be required.
The Company shall not be required to issue or deliver any certificate or
certificates for shares of its Common Stock prior to (a) the admission of such
shares to listing on any stock exchange on which the stock may then be listed
and (b) the completion of any registration or other qualification of such shares
under any state or federal law or rulings or regulations of any government body,
which the Company shall, in its sole discretion, determine to be necessary or
advisable.
10. Except as provided herein, this option may not be amended or
otherwise modified in a manner that is adverse to the interests of the Director
unless evidenced in writing and signed by the Company and the Director.
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11. The granting of this option shall in no way constitute or be
evidence of any agreement or understanding, express or implied, that the
Director has a right to continue as a director of the Company for any period of
time, or at any particular rate of compensation.
12. All notices required hereby shall, unless otherwise provided
herein, be mailed or delivered by hand or by recognized overnight delivery
service to the parties at their respective addresses set forth beneath their
names below or at such other address as may be designated in writing by either
of the parties to one another.
THE ALLEN GROUP INC.
By:
______________________________
The Allen Group Inc.
25101 Chagrin Boulevard
Suite 350
Beachwood, Ohio 44121
Attn: Treasurer
The foregoing option is hereby accepted on the terms and conditions set
forth herein.
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Director's Signature
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Director's Social Security Number
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Director's Address
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Exhibit A
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NON-QUALIFIED OPTION
__________________, 19__
The Allen Group Inc.
25101 Chagrin Boulevard
Suite 350
Beachwood, OH 44122
ATTN: Treasurer
I hereby exercise the non-qualified stock option granted to
_______________ under date of ________________ to the extent of __________
shares of Common Stock of The Allen Group Inc. (the "Company") (the "Purchased
Shares") at the option price of $________ per share, for a total exercise cost
of $__________.
In payment of the option price for the Purchased Shares, I am enclosing
the following:
A. Cash represented by a (personal check) (bank cashier's
check) (money order)* payable to the order of the Company in
the amount of $____________**, or
B. ___________ shares of the Company's Common Stock owned by me
having an aggregate fair market value to be determined by the
last sale price of the Company's Common Stock as reported on
the New York Stock Exchange Composite Tape on the date of
receipt at the corporate office of the Company of this Exhibit
A plus cash, if any, required to complete the full purchase
price, represented by a (personal check) (bank cashier's
check) (money order)* payable to the order of the Company in
the amount of $______________.
If the aggregate value of the Common Stock tendered herewith plus the
amount of any cash do not constitute the full purchase price for the Purchased
Shares, I agree to deliver additional shares and/or cash represented by a
personal check, bank cashier's check or money order payable to the order of the
Company for the balance due promptly after I am notified by you.
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I understand that all shares issuable to me upon the exercise of such
stock option have not been registered by the Company with the United States
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended, and I also hereby agree that any sale of such shares by me will be made
only through a prospectus complying with the registration provisions of the
Securities Act of 1933, as amended, or through an exemption from such
provisions.
Very truly yours,
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Address:
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Witness
* Strike out words that are not applicable.
** Payment of the option price may also be made by a transfer of funds or
an irrevocable credit to an authorized bank account of the Company; in
such case, the foregoing exercise of the option will be effective on
the date of such transfer or credit.
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