Exhibit 10.1 (1)
FORM: ALL U.S. PARTICIPANT GRANTS AND
FOREIGN PARTICIPANT NONQUALIFIED GRANTS
TECHNITROL, INC.
2001 STOCK OPTION PLAN
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement") is made and entered
into as of this 22nd day of September, 2004 ("Date of Grant"), by and between
TECHNITROL, INC. a Pennsylvania corporation (the "Company"), and ("Optionee").
Background
The Company adopted the Technitrol, Inc. 2001 Stock Option Plan (the
"Plan") to attract, retain and motivate the best available personnel and to
provide additional incentive to key employees of the Company and its
subsidiaries to promote the success of the business. Pursuant to and in
accordance with the Plan, the Company desires to grant to Optionee a stock
option to purchase shares of the Company's Common Stock as more fully set forth
below. The Plan is administered by the Executive Compensation Committee of the
Board of Directors ("Committee"). Capitalized terms used in this Agreement and
not otherwise defined herein, shall have the meanings ascribed to them in the
Plan.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, and intending to be legally bound, it is agreed as follows:
1. Option to Purchase Shares. The Company hereby grants to Optionee
an Option (the "Option") to purchase up to the number of shares of the Company's
Common Stock (the "Stock") listed below at the Exercise Price listed below,
pursuant and subject to the terms and provisions of the Plan, which are
incorporated by reference herein. The Exercise Price for each share of Stock is
100% of the Market Value (as defined in the Plan) of each share of Stock as of
the Date of Grant. The Option will be exercisable according to Section 2 below.
The Option is not an "incentive stock option" within the meaning of Section 422
of the U.S. Internal Revenue Code of 1986, as amended, nor is the Option
qualified under the laws of any non U.S. country for preferential tax treatment
or any other reason.
Number of Shares __________
Exercise Price Per Share __________
2. (a) Vesting of Option. The Option will become exercisable upon
Optionee's completion of each Year of Service (as defined in the Plan) after the
Date of Grant ("Exercise Period(s)") as set forth in the following table:
Percentage of Shares Subject to
Years of Continuous Option which may be
Service after Date of Grant Exercised
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Upon Grant 0%
1 year but less than 2 years 25%
2 years but less than 3 years 50%
3 years but less than 4 years 75%
4 years 100%
Notwithstanding the vesting schedule(s) above, an Option shall
become one hundred percent (100%) vested upon a Change in Control or termination
of the Optionee's service due to Disability, death or retirement at or after age
65. If Optionee elects to retire before age 65 but on or after his or her "early
retirement date," as defined in the Technitrol, Inc. Retirement Plan, or has his
or her employment terminated by the Company, other than for Cause, prior to the
completion of four (4) Years of Service after the Date of Grant, Optionee shall
be entitled to pro-rata vesting, based upon the number of months elapsed since
the Date of Grant to the date of Optionee's retirement or termination by the
Company, divided by 48.
(b) Period of Exercise. The Option may be exercised, to the extent
vested, (i) only while Optionee is an Employee (as defined in the Plan) and has
maintained Continuous Service from the Date of Grant, or (ii) within 60 days
after termination of such Continuous Service (but not later than the date on
which the Option would otherwise expire). However, in the event Optionee's
Continuous Service terminates by reason of Cause, death, Disability or
retirement on or after the "early retirement age," the provisions of Section
8(c) of the Plan will control the ability, if any, of Optionee to exercise the
Option.
3. Manner of Exercise and Terms of Payment. The Option may be
exercised in whole or in part, subject to the limitations set forth in the Plan
and this Agreement, upon delivery to the payroll office from which Optionee is
paid of timely written notice of exercise on the form of Stock Option Exercise
Request (current form attached hereto as Exhibit "A," which form may be amended
from time to time), accompanied by full payment of the Exercise Price for the
shares of Stock with respect to which the Option is exercised and all applicable
withholding taxes. The Option may not be exercised for fractions of a Share.
Full payment of the Exercise Price and all applicable withholding taxes shall be
in cash (US dollars or the foreigh currency equivalent based on the exchange
rate on the date of exercise as published in The Wall Street Journal) or, if and
as permitted by the Committee in its sole discretion or under the Plan, by
delivery of any property (including Common Stock of the Company) other than
cash, as long as such property constitutes valid consideration for the Stock
under applicable law.
4. (a) Term of Option. The Option shall have a term of seven (7)
years from the Date of Grant ("Expiration Date") and shall terminate at the
expiration of that period, unless it is terminated at an earlier date pursuant
to the provisions of this Agreement or the Plan.
(b) Termination. The Option will automatically terminate upon
the first to occur of (i) an event of default or breach by the Optionee of the
terms and conditions of this Agreement, or (ii) 60 days after Optionee ceases to
be an Employee or maintain Continuous Service from the Date of Grant, except if
the termination of Continuous Service was for Cause or by reason of death,
Disability, or retirement on or after the "early retirement age." If the
Optionee's employment is terminated for Cause, death, Disability, or retirement
on or after the "early retirement age," then the provisions of Section 8(c) of
the Plan shall apply with regard to termination of the Option and Optionee's
ability to exercise the Option.
5. Rights as Shareholder. Neither Optionee nor any permitted
transferee of the Option shall have any rights or privileges of a shareholder of
the Company with respect to any shares of Stock subject to the Option until such
shares of Stock have been issued upon the exercise of the Option.
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6. No Employment or Other Rights. The grant of the Option shall not
confer upon the Optionee any right to be retained by or in the employ or service
of the Company or any subsidiary of the Company and shall not interfere in any
way with the right of the Company to terminate the Optionee's employment or
service at any time. The right of the Company or any of its subsidiaries to
terminate at will the Optionee's employment or service at any time for any
reason is specifically reserved.
7. Delivery of Stock Certificates. The Company shall not be required
to issue or deliver any certificate for shares of Stock purchased upon the
exercise of all or any portion of an Option granted under the Plan prior to the
fulfillment of any of the following conditions which may, from time to time, be
applicable to the issuance of the Stock:
(a) Listing of Shares. The admission of such shares of Stock
to listing on all stock exchanges on which the Common Stock of the Company is
then listed.
(b) Registration and/or Qualification of Shares. The
completion of any registration or other qualification of such shares of Stock
under any U.S. federal, state or non U.S. securities laws or under the
regulations promulgated by the Securities and Exchange Commission or any other
U.S. federal, state or non U.S. governmental regulatory body which the Board or
Committee, as the case may be, deems necessary or advisable. The Company shall
in no event be obligated to register any securities pursuant to the Securities
Act of 1933 (as now in effect or as hereafter amended) or to take any other
action in order to cause the issuance and delivery of such certificates to
comply with any such law, regulations or requirement. As a condition to the
Optionee's exercise of this Option, the Company may require the person
exercising the Option to make any representation and warranty to the Company as
may be required by any applicable law or regulation.
(c) Approval or Clearance. The receipt of any approval or
clearance from any U.S. federal, state or non U.S. governmental agency which the
Board or the Committee, as the case may be, shall determine to be necessary or
advisable.
(d) Reasonable Lapse of Time. The lapse of such reasonable
period of time following the exercise of the Option as the Committee may
establish from time to time for reasons of administrative convenience.
(e) Tax Withholding. Optionee's satisfaction of all applicable
U.S. federal, state, local or non U.S. income and employment tax withholding
obligations.
8. Change in Control. The Plan sets forth the effect that a Change
in Control of the Company has on the Option granted hereunder.
9. Options Subject to Plan Provisions. (a) The grant and exercise of
the Option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) changes in capitalization of the
Company, (ii) transactions in which the Company is not the surviving entity, and
(iii) other changes resulting from a merger, reorganization, stock dividend or
similar transactions, all of which may effect the number and kind of Shares
underlying the Option in accordance with the Plan. Optionee acknowledges and
agrees that to the extent the Exercise Price or number of shares underlying the
Option are required to be adjusted pursuant to Section 10 of the 2001 Plan, the
Option granted hereunder will be adjusted accordingly, notwithstanding anything
to the contrary in the Spanish Addendum and/or UK Addendum. Optionee also
acknowledges and agrees that any such adjustment may disqualify the Option from
the favorable tax treatment afforded by the Local Laws.
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(b) The Committee shall have the authority to interpret and construe
the Option pursuant to the terms of the Plan, and its decisions shall be
conclusive as to any questions arising hereunder. A copy of the Plan has
previously been delivered to Optionee (an additional copy may be obtained from
the Secretary of the Company by request in writing to the address set forth in
Section 11(a) hereof).
10. Restrictions on Transfers. The Option may not be sold, pledged,
assigned, hypothecated, transferred or disposed of in any manner by Optionee
other than by will or by the laws of descent and distribution (and in the case
of transfer or assignment by will, descent or distribution, solely to give
effect to the provisions of Section 8(c)(2) of the Plan). Notwithstanding the
foregoing, or any other provision of the Plan or this Agreement, the Committee,
in its sole discretion, may permit Optionee to transfer the Option by gift to
his or her spouse, lineal ascendants, lineal descendants, or to a duly
established trust for the benefit of one or more of these individuals. Following
such transfer, the Option may thereafter be transferred by gift, subject to the
approval of the Committee, only to Optionee or to an individual or trust to whom
the Optionee could have initially transferred the Option pursuant to this
Section. If the Option is transferred pursuant to this Section, it shall be
exercisable by the transferee according to the same terms and conditions as
applied to the Optionee.
11. Miscellaneous.
(a) Except for notices to exercise the Option which shall be
sent to the payroll office from which Optionee is paid, all notices provided for
or contemplated herein shall be in writing and addressed as follows:
If to the Company: Technitrol, Inc.
1210 Northbrook Drive
Suite 385
Trevose, Pennsylvania 19053
Attn.: Corporate Secretary
If to the Optionee: At the address listed on the payroll
records of Optionee's employer.
or to such other addresses as the parties may specify in writing.
(b) Except to the extent U.S. federal law applies, this
Agreement shall be construed in accordance with the laws of the Commonwealth of
Pennsylvania, U.S.A., without regard to its conflicts of law principles.
IN WITNESS WHEREOF, the undersigned have executed, or have caused
this Agreement to be executed, as of the day and year first above written.
TECHNITROL, INC. OPTIONEE
By:
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Name: Thomas J. Considine, Jr. Name:
Title: Secretary
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