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Exhibit 3
Dear
In accordance with the l997 Stock Incentive Plan (the "Plan") of
National Sanitary Supply Company (the "Corporation"), you are hereby granted an
option to purchase ____ shares of the common stock, par value $1.00 per share,
of the Corporation upon the following terms and conditions.
(1) The purchase price shall be $_______ per share. Payment shall be
made in cash or, subject to the next sentence, by delivery to the Corporation of
shares of common stock of the Corporation which shall be valued at their Fair
Market Value on the date of exercise, or in a combination of cash and such
shares. Your right to pay the purchase price by delivery to the Corporation of
shares of common stock of the Corporation is subject to the condition that such
shares are then being publicly traded, such right may be temporarily or
permanently revoked by the Board of Directors without any advance notice to you.
(2) Subject to the provisions of paragraphs (3) and (6), this option is
exercisable in whole or in part at any time and from time to time as follows:
____________ shares on or after ______________, l9____
____________ shares on or after ______________, l9____
____________ shares on or after ______________, l9____
____________ shares on or after ______________, l9____
Once an installment becomes exercisable, it may be exercised at any
time in whole or in part until the expiration or termination of this option.
Neither this option nor any right hereunder may be assigned or
transferred by you, except by (i) will or the laws of descent and distribution,
(ii) pursuant to a qualified domestic relations order, or (iii) to certain
family members, if permitted by Securities and Exchange Rule 16 (b)(3). It may
be exercised during your life only by you. Within fifteen (15) months after your
death it may be exercised only by your estate or by a person who acquired the
right to exercise the option by bequest or inheritance or by reason of your
death. At the time of each exercise of this option, the person exercising the
option shall, if requested by the Corporation, give assurances, satisfactory to
counsel to the Corporation, concerning such matters as the Corporation may deem
desirable to assure compliance with all applicable legal requirements.
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(3) This option, to the extent that it shall not have been exercised,
shall terminate when you cease to be an employee of the Corporation or a
Subsidiary, unless you cease to be an employee because of your resignation with
the consent of the Incentive Committee or because of your death, incapacity or
retirement under a retirement plan of the Corporation or a Subsidiary. If you
cease to be an employee because of such resignation, this option shall terminate
upon the expiration of three months after you cease to be an employee, except as
provided in the next sentence. If you cease to be an employee because of your
death, incapacity or retirement under a retirement plan of the Corporation or a
Subsidiary, or if you cease to be an employee because of your resignation with
the consent of the Incentive Committee and die during the three month period
referred to in the preceding sentence, this option shall terminate fifteen (15)
months after you ceased to be an employee. Where this option is exercised more
than three months after termination of employment, only those installments which
shall have become exercisable prior to the expiration of three months after you
ceased to be an employee may be exercised. A leave of absence for military or
governmental service or for other purposes shall not, if approved by the
Incentive Committee, be deemed a termination of employment under this paragraph,
provided this option may not be exercised during any such leave of absence. This
option shall in no even be exercisable after the expiration of eleven years from
the date this option is granted.
(4) The number and class of shares or other securities covered by this
option and the price to be paid therefor shall be subject to adjustment as
provided in Section 8 of the Plan.
(5) This option may be exercised only by serving written notice on the
Secretary or Treasurer of the Corporation. The Corporation shall deliver the
shares to you against payment; provided, however, no shares shall be issued or
transferred until all legal requirements applicable to the issuance or transfer
of such shares, in the opinion of the counsel to the Corporation, have been
complied with. Any federal, state or local withholding taxes applicable to any
compensation you may realize by reason of the exercise of the option or any
subsequent disposition of the shares acquired on exercise shall, upon request,
be remitted to the Corporation or the Subsidiary by which you are employed at
the time of exercise or sale. You shall have the rights of a stockholder only as
to stock actually delivered to you.
(6) If you are or become an employee of a Subsidiary, the Corporation's
obligations hereunder shall be contingent on the approval of the Plan and this
option by the Subsidiary and the Subsidiary's agreement that (a) the Corporation
may administer the Plan on its behalf, and (b) upon the exercise of the option,
it will purchase from the Corporation the shares at their Fair Market Value on
the date of exercise, and will transfer such shares to the optionee upon his or
her payment of the purchase price to the Subsidiary. Such approval and agreement
of the Subsidiary shall be indicated by its signature below.
(7) This option is not an Incentive Stock Option under the provisions
of Section 422A of the Internal Revenue Code of l954, as amended.
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(8) The Plan is hereby incorporated by reference. Each term which is
defined in the Plan and used in this option shall have the same meaning in this
option as it has in the Plan. This option is granted subject to the Plan and
shall be construed to conform to the Plan.
Very truly yours,
NATIONAL SANITARY SUPPLY COMPANY
BY: ________________________________
President and
Chief Executive Officer
Receipt Acknowledged:
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Employee
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