EXHIBIT 10-a-2
[TERMS AND CONDITIONS -- NON-COMPETE, ISOS, PRIORITY, NQ]
ROCKWELL XXXXXXX, INC.
2001 LONG-TERM INCENTIVES PLAN
STOCK OPTION AGREEMENT
STOCK OPTION TERMS AND CONDITIONS
1. Definitions
As used in these Stock Option Terms and Conditions, the following words
and phrases shall have the respective meanings ascribed to them below
unless the context in which any of them is used clearly indicates a
contrary meaning:
(a) Cashless Exercise: Cashless Exercise shall have the meaning set
forth in Section 3(a)(ii) herein.
(b) Change of Control: Change of Control shall have the same meaning as
such term has in Section 2(d) of the Plan.
(c) Xxxxxxx Xxxxxx: Xxxxxxx Xxxxxx & Co., Inc., the Stock Option
Administrator whom Rockwell Xxxxxxx has engaged to administer and
process all Option exercises.
(d) Committee: The Compensation and Management Development Committee of
the Board of Directors of Rockwell Xxxxxxx.
(e) Corporation: Rockwell Xxxxxxx and its Subsidiaries (as such term is
defined in the Plan).
(f) Customer Service Center: Xxxxxxx Xxxxxx'x Customer Service Center
that is used to facilitate Option transactions. Contact Xxxxxxx
Xxxxxx at (000) 000-0000.
(g) Employee: Employee shall have the same meaning as such term has in
Section 2(j) of the Plan.
(h) Exercise Request and Attestation Form: The form attached as Exhibit
1 or any other form accepted by Xxxxxxx Xxxxxx in connection with
the use of already-owned Shares to pay all or part of the exercise
price for the Option Shares to be purchased on exercise of any of
the Options.
(i) Options: The stock options listed in the first paragraph of the
letter dated [ ], to which these Stock Option Terms and Conditions
are attached and which together with these Stock Option Terms and
Conditions constitute the Stock Option Agreement.
(j) Option Shares: The shares of Rockwell Xxxxxxx Common Stock issuable
or transferable on exercise of the Options.
(k) Plan: Rockwell Xxxxxxx 2001 Long-Term Incentives Plan, as such Plan
may be amended and in effect at the relevant time.
(l) Rockwell Xxxxxxx: Xxxxxxxx Xxxxxxx, Inc., a Delaware corporation,
and any successor thereto.
(m) Schwab OptionCenter(R) : Xxxxxxx Xxxxxx'x stock option management
website which you can use to access your stock option account and to
facilitate stock option transactions securely on the web at
xxx.xxxxxx.xxx/xxxxxxxxxxxx.
(n) Shares: Shares of Rockwell Xxxxxxx Common Stock.
(o) Stock Option Agreement: These Stock Option Terms and Conditions
together with the letter dated [ ], to which they are attached.
2. When Options May be Exercised
The Options may be exercised, in whole or in part (but only for a whole
number of shares) and at one time or from time to time, as to one-third
(rounded to the nearest whole number) of the Option Shares granted
pursuant to nonqualified stock options (NQs) and incentive stock options
(ISOs) during the period beginning on [ ] and ending on [ ], as to an
additional one-third (rounded to the nearest whole number) of the Option
Shares granted pursuant to NQs and ISOs during the period beginning on [ ]
and ending on [ ] and as to the balance of the Option Shares granted
pursuant to NQs and ISOs during the period beginning on [ ] and ending on
[ ], and only during those periods, and provided that:
(a) if you die while an Employee, any person who holds the Options as
permitted by Section 4 herein may exercise all the Options not
theretofore exercised within (and only within) the period beginning
on your date of death (even if you die before you have become
entitled to exercise all or any part of the Options) and ending
three years thereafter; and
(b) if your employment by the Corporation terminates other than by
death, then:
(i) if your retirement or other termination date is before [ ],
the Options shall lapse on your retirement or other
termination and may not be exercised at any time;
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(ii) if your employment by the Corporation is terminated for cause,
as determined by the Committee, the Options shall expire
forthwith upon your termination and may not be exercised
thereafter;
(iii) if your employment by Rockwell Xxxxxxx terminates on or after
[ ] by reason of your retirement under a retirement plan of
Rockwell Xxxxxxx, or under a retirement plan of a subsidiary
or affiliate of Rockwell Xxxxxxx, you (or any person who holds
the Options as permitted by Section 4 herein) may thereafter
exercise Options which are exercisable prior to the date of
your retirement or that will become exercisable within (and
only within) the period between the date of your retirement
and ending on the fifth anniversary of your retirement date;
or if you retire prior to age 62, the earlier of (x) the fifth
anniversary of your retirement date or (y) such earlier date
as the Committee shall determine by action taken not later
than 60 days after your retirement date; and
(iv) if your employment by the Corporation terminates on or after
[ ] for any reason not specified in subparagraph (a) or in
clauses (ii) or (iii) of this subparagraph (b), you (or any
person who holds the Options as permitted by Section 4 herein)
may thereafter exercise the Options within (and only within)
the period ending three months after your termination date but
only to the extent such Options were exercisable on your
termination date.
In no event shall the provisions of the foregoing subparagraphs (a)
and (b) extend to a date after [ ], the period during which the
Options may be exercised.
Notwithstanding any other provision of this Agreement, if a Change
of Control shall occur, then all Options then outstanding pursuant
to this Agreement shall forthwith become fully exercisable whether
or not then otherwise exercisable in accordance with their terms.
3. Exercise Procedure
(a) To exercise all or any part of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must contact the
Stock Option Administrator, Xxxxxxx Xxxxxx, by using the Customer
Service Center or Schwab OptionCenter(R), as follows:
(i) contact the Customer Service Center by calling (000) 000-0000
Monday through Friday, 9:00 a.m. to 9:00 p.m. Eastern Time and
follow the instructions provided, or exercise via the Web
through the Schwab OptionCenter(R) at xxx.xxxxxx.xxx/
optioncenter;
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(ii) confirm the Option transaction through the Customer Service
Center or Schwab OptionCenter(R);
(iii) at any time you may speak to a Customer Service Representative
for assistance by calling 000-000-0000;
(iv) full payment of the exercise price for the Option Shares to be
purchased on exercise of the Options may be made by:
- check (wire) to your Xxxxxxx Xxxxxx account; or
- in already-owned Shares; or
- by authorizing Xxxxxxx Xxxxxx or a third party
approved by Rockwell Xxxxxxx to sell the Shares
(or a sufficient portion of the Shares) acquired
upon exercise of the Option ("Cashless Exercise");
or
- in a combination of check (wire) to your Xxxxxxx
Xxxxxx account and Shares (whether already-owned
Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise); and
(v) in the case of an exercise of the Options by any person other
than you seeking to exercise the Options, such documents as
Xxxxxxx Xxxxxx or the Secretary of Rockwell Xxxxxxx shall
require to establish to their satisfaction that the person
seeking to exercise the Options is entitled to do so.
(b) An exercise of the whole or any part of the Options shall be
effective:
(i) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price for the
Option Shares entirely by check (wire), upon (A) completion of
your transaction by using the Customer Service Center or
Schwab OptionCenter(R) and full payment of the exercise price
and withholding taxes (if applicable) are received by Xxxxxxx
Xxxxxx within three business days following the exercise; and
(B) receipt of any documents required pursuant to Section
3(a)(v) herein; and
(ii) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price of the
Option Shares in Shares (whether already-owned Shares or
Shares issued and subsequently sold in connection with a
Cashless Exercise) or in a combination of Shares (whether
already-owned Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise) and check, upon (A)
completion of your transaction by
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using the Customer Service Center or Schwab OptionCenter(R)
and full payment of the exercise price (as described in
Section 3(d)(i) herein) and withholding taxes (if applicable)
are received by Xxxxxxx Xxxxxx within three business days
following the exercise; and (B) receipt of any documents
required pursuant to Section 3(a)(v) herein.
(c) If you choose (or any person who holds the Options as permitted by
Section 4 herein chooses) to pay the exercise price for the Option
Shares to be purchased on exercise of any of the Options entirely by
check, payment must be made by:
- delivering to Xxxxxxx Xxxxxx a check (wire) in the full
amount of the exercise price for those Option Shares; or
- arranging with a stockbroker, bank or other financial
institution to deliver to Xxxxxxx Xxxxxx full payment,
by check or (if prior arrangements are made with Xxxxxxx
Xxxxxx) by wire transfer, of the exercise price of those
Option Shares.
In either event, in accordance with Section 3(e) herein, full
payment of the exercise price for the Option Shares purchased must
be made within three business days after the exercise has been
completed through the Customer Service Center or Schwab
OptionCenter(R).
(d) (i) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use already-owned
Shares to pay all or part of the exercise price for the Option
Shares to be purchased on exercise of any of the Options, you
(or any person who holds the Options as permitted by Section 4
herein) must deliver to Xxxxxxx Xxxxxx an Exercise Request and
Attestation Form and cash to cover the purchase of one Option
Share as specified in such form. To perform such a
transaction, the Exercise Request and Attestation Form must be
submitted via fax ((000) 000-0000) by 4:00 p.m. Eastern Time
on the date of exercise and any questions concerning this type
of transaction should be referred to (000) 000-0000 (Stock
Option Administration Group Hotline). The Exercise Request and
Attestation Form must attest to your ownership of Shares
representing:
- at least the number of Shares whose value, based
on the closing price of Common Stock of Rockwell
Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center or Schwab OptionCenter(R), equals
the exercise price for the Option Shares; or
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- any lesser number of Shares you desire (or any
person who holds the Options as permitted by
Section 4 herein desires) to use to pay the
exercise price for those Option Shares and a check
in the amount of such exercise price less the
value of the Shares delivered, based on the
closing price of Common Stock of Rockwell Xxxxxxx
on the New York Stock Exchange -- Composite
Transactions on the day you have exercised your
Options through the Customer Service Center or
Schwab OptionCenter(R).
(ii) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use Option Shares
obtained by Cashless Exercise to pay all or part of the
exercise price for the remaining Option Shares to be purchased
on exercise of any of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must
contact the Customer Service Center at (000) 000-0000 or
Schwab OptionCenter(R).
(iii) Xxxxxxx Xxxxxx will advise you (or any other person who, being
entitled to do so, exercises the Options) of the exact number
of Shares, valued at the closing price on the New York Stock
Exchange -- Composite Transactions on the effective date of
exercise under Section 3(b)(ii) herein, and any funds required
to pay in full the exercise price for the Option Shares
purchased. In accordance with Section 3(e) herein, you (or
such other person) must pay, by check, in Shares or in a
combination of check and Shares, any balance required to pay
in full the exercise price of the Option Shares purchased
within three business days following the effective date of
such exercise of the Options under Section 3(b)(ii) herein.
(iv) Notwithstanding any other provision of this Stock Option
Agreement, the Secretary of Rockwell Xxxxxxx may limit the
number, frequency or volume of successive exercises of any of
the Options in which payment is made, in whole or in part, by
delivery of Shares pursuant to this subparagraph (d) to
prevent unreasonable pyramiding of such exercises.
(e) An exercise completed through the Customer Service Center or
Schwab OptionCenter(R), whether or not full payment of the
exercise price for the Option Shares is received by Xxxxxxx
Xxxxxx, shall constitute a binding contractual obligation by
you (or the other person entitled to exercise the Options) to
proceed with and complete that exercise of the Options (but
only so long as you continue, or the other person entitled to
exercise the Options continues, to be entitled to exercise
the Options on that date). By your acceptance of this Stock
Option Agreement, you agree (for yourself
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and on behalf of any other person who becomes entitled to exercise
the Options) to pay to Xxxxxxx Xxxxxx in full the exercise price for
those Option Shares, that payment being by check, wire transfer, in
Shares or in a combination of check and Shares, on or before the
third business day after the date on which you complete the
transaction through the Customer Service Center. If such payment is
not made, you (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) authorize Rockwell
Xxxxxxx, in its discretion, to set off against salary payments or
other amounts due or which may become due you (or the other person
entitled to exercise the Options) any balance of the exercise price
for those Option Shares remaining unpaid thereafter.
(f) An Exercise Confirmation representing the number of Option Shares
purchased will be issued the third business day (trade date plus
three business days) (i) after Xxxxxxx Xxxxxx has received full
payment therefor or (ii) at Rockwell Xxxxxxx' or Xxxxxxx Xxxxxx'x
election in their sole discretion, after Rockwell Xxxxxxx or Xxxxxxx
Xxxxxx has received (x) full payment of the exercise price of those
Option Shares and (y) any reimbursement in respect of withholding
taxes due pursuant to Section 5 herein.
4. Transferability; Nonassignability
You are not entitled to transfer the Options except by will or by the laws
of descent and distribution.
5. Withholding
Rockwell Xxxxxxx or Xxxxxxx Xxxxxx shall have the right, in connection
with the exercise of the Options, in whole or in part, to deduct from any
payment to be made by Rockwell Xxxxxxx or Xxxxxxx Xxxxxx an amount equal
to the taxes required to be withheld by law with respect to such exercise
or to require you (or any other person entitled to exercise the Options)
to pay to it an amount sufficient to provide for any such taxes so
required to be withheld. By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) that if Rockwell Xxxxxxx or
Xxxxxxx Xxxxxx elects to require you (or such other person) to remit an
amount sufficient to pay such withholding taxes, you (or such other
person) must remit that amount within three business days after the
completion of the Option exercise as provided in Section 3(a)(ii) herein.
If such payment is not made, Rockwell Xxxxxxx, in its discretion, shall
have the same right of set-off as provided under Section 3(e) herein with
respect to payment of the exercise price for Option Shares.
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6. Headings
The section headings contained in these Stock Option Terms and Conditions
are solely for the purpose of reference, are not part of the agreement of
the parties and shall in no way affect the meaning or interpretation of
this Stock Option Agreement.
7. References
All references in these Stock Option Terms and Conditions to Sections,
paragraphs, subparagraphs or clauses shall be deemed to be references to
Sections, paragraphs, subparagraphs and clauses of these Stock Option
Terms and Conditions unless otherwise specifically provided.
8. Entire Agreement
This Stock Option Agreement and the other terms applicable to Stock
Options granted under the Plan embody the entire agreement and
understanding between Rockwell Xxxxxxx and you with respect to the
Options, and there are no representations, promises, covenants, agreements
or understandings with respect to the Options other than those expressly
set forth in this Stock Option Agreement and the Plan.
9. Applicable Laws and Regulations
This Stock Option Agreement and Rockwell Xxxxxxx obligation to issue
Option Shares hereunder are subject to applicable laws and regulations.
Exhibit 1 Exercise Request and Attestation Form (For Use With Already-
Owned Shares)
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2001 LONG-TERM INCENTIVES PLAN
FORM OF OPTION AGREEMENT
[EXISTING ARBITRATION AGREEMENT]
[Grant Date]
To:
Social Security/Account Number:
Dear Optionee:
We are pleased to notify you that you have been granted the following stock
options under the 2001 Long-Term Incentives Plan (the "Plan"):
Date of Grant Type of Grant Number of Shares Option Price
------------- ------------- ---------------- ------------
These stock options (the "Options") have been granted under and may be exercised
only upon the terms and conditions of this Stock Option Agreement, subject in
all respects to the provisions of the Plan, as it may be amended. The enclosed
Stock Option Terms and Conditions are incorporated in and are part of this Stock
Option Agreement.
A copy of the Plan and Plan Prospectus are enclosed. Please carefully read the
enclosed documents and retain them for future reference.
ROCKWELL XXXXXXX, INC.
By:
2001 LONG-TERM INCENTIVES PLAN
FORM OF OPTION AGREEMENT
[NON-COMPETE, NEW ARBITRATION AGREEMENT]
[Grant Date]
To:
Social Security/Account Number:
Dear Optionee:
We are pleased to notify you that you have been granted the following stock
options under the 2001 Long-Term Incentives Plan (the "Plan"):
Date of Grant Type of Grant Number of Shares Option Price
------------- ------------- ---------------- ------------
These stock options (the "Options") have been granted under and may be exercised
only upon the terms and conditions of this Stock Option Agreement, subject in
all respects to the provisions of the Plan, as it may be amended. The enclosed
Stock Option Terms and Conditions are incorporated in and are part of this Stock
Option Agreement.
In partial consideration for the grant of the Options to you, you undertake and
agree by your acceptance of this Stock Option Agreement that
(a) during your employment with the Corporation (as defined in the Plan)
and for two years after the date of your retirement or other
termination of such employment, you shall not (i) directly or
indirectly, except with the approval of the Corporation, engage or
otherwise participate in any business which is competitive with any
significant line of business of the Corporation or any of its
affiliates (otherwise than through ownership of not more than 5% of
the voting securities of any such competitive business) or (ii)
solicit or induce any employee of the Corporation or any of its
affiliates to leave his or her employment with the Corporation or
any of its affiliates to accept employment or other engagement with
any such competitive business; and
(b) in the event that you breach this undertaking, in addition to any
and all other remedies the Corporation may have, (i) the Corporation
shall have the right to determine by written notice to you that any
of the Options then outstanding shall immediately lapse and cease to
be exercisable; and (ii) you agree to pay the Corporation upon
written demand the amount of the excess
of the Fair Market Value (as defined in the Plan) of any shares of
the Corporation's Common Stock you acquired upon exercise of any of
the Options (other than Options exercised more than two years before
the date of your retirement or other termination of employment) over
the exercise price for those Shares.
If a Change of Control (as defined in the Plan) shall occur, however, the
foregoing provisions (a) and (b) shall immediately terminate as of, and shall
not limit your activities after, the date of such Change of Control.
This stock option grant is also subject to the condition that you sign and
return one copy of the Mutual Agreement to Arbitrate Claims to:
Rockwell Xxxxxxx, Inc.
Office of the Secretary
000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
A copy of the Plan and Plan Prospectus are enclosed. Please carefully read the
enclosed documents and retain them for future reference.
The Options will lapse and be of no effect if a copy of this Stock Option
Agreement and a copy of the Mutual Agreement to Arbitrate Claims, each properly
signed by you, are not received by the Secretary of Rockwell Xxxxxxx, Inc. at
the above address on or before November 30, 2001, unless Rockwell Xxxxxxx, Inc.
(in its sole discretion) elects in writing to extend that date.
Agreed to: ROCKWELL XXXXXXX, INC.
Date:______________________
___________________________ By:
Employee Signature
[Social Security No.]
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[TERMS AND CONDITIONS -- INSIDER, ISOS, PRIORITY, NQ]
ROCKWELL XXXXXXX, INC.
2001 LONG-TERM INCENTIVES PLAN
STOCK OPTION AGREEMENT
STOCK OPTION TERMS AND CONDITIONS
1. Definitions
As used in these Stock Option Terms and Conditions, the following words
and phrases shall have the respective meanings ascribed to them below
unless the context in which any of them is used clearly indicates a
contrary meaning:
(a) Cashless Exercise: Cashless Exercise shall have the meaning set
forth in Section 3(a)(ii) herein.
(b) Change of Control: Change of Control shall have the same meaning as
such term has in Section 2(d) of the Plan.
(c) Xxxxxxx Xxxxxx: Xxxxxxx Xxxxxx & Co., Inc., the Stock Option
Administrator whom Rockwell Xxxxxxx has engaged to administer and
process all Option exercises.
(d) Committee: The Compensation and Management Development Committee of
the Board of Directors of Rockwell Xxxxxxx.
(e) Corporation: Rockwell Xxxxxxx and its Subsidiaries (as such term is
defined in the Plan).
(f) Customer Service Center: Xxxxxxx Xxxxxx'x Customer Service Center
that is used to facilitate Option transactions. Contact Xxxxxxx
Xxxxxx at (000) 000-0000.
(g) Employee: Employee shall have the same meaning as such term has in
Section 2(j) of the Plan.
(h) Exercise Request and Attestation Form: The form attached as Exhibit
2 or any other form accepted by Xxxxxxx Xxxxxx in connection with
the use of already-owned Shares to pay all or part of the exercise
price for the Option Shares to be purchased on exercise of any of
the Options.
(i) Notice of Exercise Form: The form attached as Exhibit 1 or any other
form accepted by the Secretary of Rockwell Xxxxxxx in his sole
discretion.
(j) Options: The stock options listed in the first paragraph of the
letter dated [ ], to which these Stock Option Terms and Conditions
are attached and which together with these Stock Option Terms and
Conditions constitute the Stock Option Agreement.
(k) Option Shares: The shares of Rockwell Xxxxxxx Common Stock issuable
or transferable on exercise of the Options.
(l) Plan: Rockwell Xxxxxxx 2001 Long-Term Incentives Plan, as such Plan
may be amended and in effect at the relevant time.
(m) Rockwell Xxxxxxx: Xxxxxxxx Xxxxxxx, Inc., a Delaware corporation,
and any successor thereto.
(n) Shares: Shares of Rockwell Xxxxxxx Common Stock.
(o) Stock Option Agreement: These Stock Option Terms and Conditions
together with the letter dated [ ], to which they are attached.
2. When Options May be Exercised
The Options may be exercised, in whole or in part (but only for a whole
number of shares) and at one time or from time to time, as to one-third
(rounded to the nearest whole number) of the Option Shares granted
pursuant to nonqualified stock options (NQs) and incentive stock options
(ISOs) during the period beginning on [ ] and ending on [ ], as to an
additional one-third (rounded to the nearest whole number) of the Option
Shares granted pursuant to NQs and ISOs during the period beginning on [ ]
and ending on [ ] and as to the balance of the Option Shares granted
pursuant to NQs and ISOs during the period beginning on [ ] and ending on
[ ], and only during those periods, and provided that:
(a) if you die while an Employee, any person who holds the Options as
permitted by Section 4 herein may exercise all the Options not
theretofore exercised within (and only within) the period beginning
on your date of death (even if you die before you have become
entitled to exercise all or any part of the Options) and ending
three years thereafter; and
(b) if your employment by the Corporation terminates other than by
death, then:
(i) if your retirement or other termination date is before [ ],
the Options shall lapse on your retirement or other
termination and may not be exercised at any time;
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(ii) if your employment by the Corporation is terminated for cause,
as determined by the Committee, the Options shall expire
forthwith upon your termination and may not be exercised
thereafter;
(iii) if your employment by Rockwell Xxxxxxx terminates on or after
[ ] by reason of your retirement under a retirement plan of
Rockwell Xxxxxxx, or under a retirement plan of a subsidiary
or affiliate of Rockwell Xxxxxxx, you (or any person who holds
the Options as permitted by Section 4 herein) may thereafter
exercise Options which are exercisable prior to the date of
your retirement or that will become exercisable within (and
only within) the period between the date of your retirement
and ending on the fifth anniversary of your retirement date;
or if you retire prior to age 62, the earlier of (x) the fifth
anniversary of your retirement date or (y) such earlier date
as the Committee shall determine by action taken not later
than 60 days after your retirement date; and
(iv) if your employment by the Corporation terminates on or after
[ ] for any reason not specified in subparagraph (a) or in
clauses (ii) or (iii) of this subparagraph (b), you (or any
person who holds the Options as permitted by Section 4 herein)
may thereafter exercise the Options within (and only within)
the period ending three months after your termination date but
only to the extent such Options were exercisable on your
termination date.
In no event shall the provisions of the foregoing subparagraphs (a)
and (b) extend to a date after [ ], the period during which the
Options may be exercised.
Notwithstanding any other provision of this Agreement, if a Change
of Control shall occur, then all Options then outstanding pursuant
to this Agreement shall forthwith become fully exercisable whether
or not then otherwise exercisable in accordance with their terms.
3. Exercise Procedure
(a) To exercise all or any part of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must first
obtain authorization from Rockwell Xxxxxxx' Office of the Secretary
by submitting a Notice of Exercise Form to Rockwell Xxxxxxx' Office
of the Secretary (Attention: Stock Option Administration; facsimile
number (000) 000-0000) or by other means acceptable to the Secretary
of Rockwell Xxxxxxx and then contact the Stock Option Administrator,
Xxxxxxx Xxxxxx, by using the Customer Service Center, as follows:
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(i) contact the Customer Service Center by calling (000) 000-0000
Monday through Friday, 9:00 a.m. to 9:00 p.m. Eastern Time and
follow the instructions provided;
(ii) full payment of the exercise price for the Option Shares to be
purchased on exercise of the Options may be made by:
- check (wire) to your Xxxxxxx Xxxxxx account; or
- in already-owned Shares; or
- by authorizing Xxxxxxx Xxxxxx or a third party
approved by Rockwell Xxxxxxx to sell the Shares
(or a sufficient portion of the Shares) acquired
upon exercise of the Option ("Cashless Exercise");
or
- in a combination of check (wire) to your Xxxxxxx
Xxxxxx account and Shares (whether already-owned
Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise); and
(iii) in the case of an exercise of the Options by any person other
than you seeking to exercise the Options, such documents as
Xxxxxxx Xxxxxx or the Secretary of Rockwell Xxxxxxx shall
require to establish to their satisfaction that the person
seeking to exercise the Options is entitled to do so.
(b) An exercise of the whole or any part of the Options shall be
effective:
(i) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price for the
Option Shares entirely by check (wire), upon (A) completion of
your transaction by using the Customer Service Center and full
payment of the exercise price and withholding taxes (if
applicable) are received by Xxxxxxx Xxxxxx within three
business days following the exercise; and (B) receipt of any
documents required pursuant to Section 3(a)(iii) herein; and
(ii) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price of the
Option Shares in Shares (whether already-owned Shares or
Shares issued and subsequently sold in connection with a
Cashless Exercise) or in a combination of Shares (whether
already-owned Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise) and check, upon (A)
completion of your transaction by using the Customer Service
Center and full payment of the exercise price (as described in
Section 3(d)(i) herein) and withholding taxes (if
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applicable) are received by Xxxxxxx Xxxxxx within three
business days following the exercise; and (B) receipt of any
documents required pursuant to Section 3(a)(iii) herein.
(c) If you choose (or any person who holds the Options as permitted by
Section 4 herein chooses) to pay the exercise price for the Option
Shares to be purchased on exercise of any of the Options entirely by
check, payment must be made by:
- delivering to Xxxxxxx Xxxxxx a check (wire) in the full
amount of the exercise price for those Option Shares; or
- arranging with a stockbroker, bank or other financial
institution to deliver to Xxxxxxx Xxxxxx full payment,
by check or (if prior arrangements are made with Xxxxxxx
Xxxxxx) by wire transfer, of the exercise price of those
Option Shares.
In either event, in accordance with Section 3(e) herein, full
payment of the exercise price for the Option Shares purchased must
be made within three business days after the exercise has been
completed through the Customer Service Center.
(d) (i) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use already-owned
Shares to pay all or part of the exercise price for the Option
Shares to be purchased on exercise of any of the Options, you
(or any person who holds the Options as permitted by Section 4
herein) must deliver to Xxxxxxx Xxxxxx an Exercise Request and
Attestation Form and cash to cover the purchase of one Option
Share as specified in such form. To perform such a
transaction, the Exercise Request and Attestation Form must be
submitted via fax ((000) 000-0000) by 4:00 p.m. Eastern Time
on the date of exercise and any questions concerning this type
of transaction should be referred to (000) 000-0000 (Stock
Option Administration Group Hotline). The Exercise Request and
Attestation Form must attest to your ownership of Shares
representing:
- at least the number of Shares whose value, based
on the closing price of Common Stock of Rockwell
Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center, equals the exercise price for the
Option Shares; or
- any lesser number of Shares you desire (or any
person who holds the Options as permitted by
Section 4 herein desires) to
-5-
use to pay the exercise price for those Option
Shares and a check in the amount of such exercise
price less the value of the Shares delivered,
based on the closing price of Common Stock of
Rockwell Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center.
(ii) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use Option Shares
obtained by Cashless Exercise to pay all or part of the
exercise price for the remaining Option Shares to be purchased
on exercise of any of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must
contact the Customer Service Center at (000) 000-0000.
(iii) Xxxxxxx Xxxxxx will advise you (or any other person who, being
entitled to do so, exercises the Options) of the exact number
of Shares, valued at the closing price on the New York Stock
Exchange -- Composite Transactions on the effective date of
exercise under Section 3(b)(ii) herein, and any funds required
to pay in full the exercise price for the Option Shares
purchased. In accordance with Section 3(e) herein, you (or
such other person) must pay, by check, in Shares or in a
combination of check and Shares, any balance required to pay
in full the exercise price of the Option Shares purchased
within three business days following the effective date of
such exercise of the Options under Section 3(b)(ii) herein.
(iv) Notwithstanding any other provision of this Stock Option
Agreement, the Secretary of Rockwell Xxxxxxx may limit the
number, frequency or volume of successive exercises of any of
the Options in which payment is made, in whole or in part, by
delivery of Shares pursuant to this subparagraph (d) to
prevent unreasonable pyramiding of such exercises.
(e) An exercise completed through the Customer Service Center, whether
or not full payment of the exercise price for the Option Shares is
received by Xxxxxxx Xxxxxx, shall constitute a binding contractual
obligation by you (or the other person entitled to exercise the
Options) to proceed with and complete that exercise of the Options
(but only so long as you continue, or the other person entitled to
exercise the Options continues, to be entitled to exercise the
Options on that date). By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person
who becomes entitled to exercise the Options) to pay to Xxxxxxx
Xxxxxx in full the exercise price for those Option Shares, that
payment being by check, wire transfer, in Shares or in a combination
of check and Shares, on or before the third business day after the
date on which you complete the
-6-
transaction through the Customer Service Center. If such payment is
not made, you (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) authorize Rockwell
Xxxxxxx, in its discretion, to set off against salary payments or
other amounts due or which may become due you (or the other person
entitled to exercise the Options) any balance of the exercise price
for those Option Shares remaining unpaid thereafter.
(f) An Exercise Confirmation representing the number of Option Shares
purchased will be issued the third business day (trade date plus
three business days) (i) after Xxxxxxx Xxxxxx has received full
payment therefor or (ii) at Rockwell Xxxxxxx' or Xxxxxxx Xxxxxx'x
election in their sole discretion, after Rockwell Xxxxxxx or Xxxxxxx
Xxxxxx has received (x) full payment of the exercise price of those
Option Shares and (y) any reimbursement in respect of withholding
taxes due pursuant to Section 5 herein.
4. Transferability; Nonassignability
You are not entitled to transfer the Options except by will or by the laws
of descent and distribution.
5. Withholding
Rockwell Xxxxxxx or Xxxxxxx Xxxxxx shall have the right, in connection
with the exercise of the Options, in whole or in part, to deduct from any
payment to be made by Rockwell Xxxxxxx or Xxxxxxx Xxxxxx an amount equal
to the taxes required to be withheld by law with respect to such exercise
or to require you (or any other person entitled to exercise the Options)
to pay to it an amount sufficient to provide for any such taxes so
required to be withheld. By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) that if Rockwell Xxxxxxx or
Xxxxxxx Xxxxxx elects to require you (or such other person) to remit an
amount sufficient to pay such withholding taxes, you (or such other
person) must remit that amount within three business days after the
completion of the Option exercise as provided in Section 3(a)(ii) herein.
If such payment is not made, Rockwell Xxxxxxx, in its discretion, shall
have the same right of set-off as provided under Section 3(e) herein with
respect to payment of the exercise price for Option Shares.
6. Headings
The section headings contained in these Stock Option Terms and Conditions
are solely for the purpose of reference, are not part of the agreement of
the parties and shall in no way affect the meaning or interpretation of
this Stock Option Agreement.
-7-
7. References
All references in these Stock Option Terms and Conditions to Sections,
paragraphs, subparagraphs or clauses shall be deemed to be references to
Sections, paragraphs, subparagraphs and clauses of these Stock Option
Terms and Conditions unless otherwise specifically provided.
8. Entire Agreement
This Stock Option Agreement and the other terms applicable to Stock
Options granted under the Plan embody the entire agreement and
understanding between Rockwell Xxxxxxx and you with respect to the
Options, and there are no representations, promises, covenants, agreements
or understandings with respect to the Options other than those expressly
set forth in this Stock Option Agreement and the Plan.
9. Applicable Laws and Regulations
This Stock Option Agreement and Rockwell Xxxxxxx obligation to issue
Option Shares hereunder are subject to applicable laws and regulations.
Exhibit 1 Notice of Exercise Form
Exhibit 2 Exercise Request and Attestation Form (For Use With Already-
Owned Shares)
-8-
EXHIBIT 1
NOTICE OF EXERCISE FORM
To: Rockwell Xxxxxxx, Inc.
Office of the Secretary
000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
Fax No. (000) 000-0000
1. OPTIONS EXERCISED: Subject to the terms and conditions of the Stock Option
Agreement dated [ ] with Rockwell Xxxxxxx, Inc. (Rockwell Xxxxxxx) thereunder, I
hereby exercise the following stock option(s):
Date of Number of Exercise Total
Grant Shares Price Purchase Price
------- ---------- ---------- --------------
$ $
------- ---------- ---------- --------------
$ $
------- ---------- ---------- --------------
$ $
------- ---------- ---------- --------------
2. PAYMENT: The following must be received by Xxxxxxx Xxxxxx & Co.,
Inc. (Xxxxxxx Xxxxxx) within three business days following the date of exercise:
- A check payable to Rockwell Xxxxxxx Employee Stock Option Program or
a wire transfer to Xxxxxxx Xxxxxx for credit to the Rockwell Xxxxxxx
Employee Stock Option Program in the amount of the Total Purchase
Price of the above-itemized stock option(s); or
- A number of shares of Rockwell Xxxxxxx Common Stock surrendered or
sold to pay the Total Purchase Price of the above-itemized stock
option(s); or
- A combination of (i) check payable to Rockwell Xxxxxxx Employee
Stock Option Program or a wire transfer to Xxxxxxx Xxxxxx for credit
to the Rockwell Xxxxxxx Employee Stock Option Program, and (ii) a
number of Shares surrendered or sold, which together amount to the
Total Purchase Price of the above-itemized stock option(s).
Notice of Exercise Form
For Officers and Directors Only
Page 2
If full payment of the Total Purchase Price of the stock option(s)
listed in Item 1 is not delivered within three (3) business days after the
exercise date, Rockwell Xxxxxxx is authorized forthwith to set off the balance
due against any amounts due or which may become due me to satisfy my obligation
to pay the Total Purchase Price.
This Stock Option Exercise may not be revoked or changed after delivery of this
form, properly completed, dated and signed, to Rockwell Xxxxxxx whether or not
payment accompanies this form and whether this form is dated before, on or after
the date of such receipt.
___________________________________
(Signature)
Printed Name_____________________________
Dated:___________________________________
[TERMS AND CONDITIONS -- NON-COMPETE, PRIORITY, NQ]
ROCKWELL XXXXXXX, INC.
2001 LONG-TERM INCENTIVES PLAN
STOCK OPTION AGREEMENT
STOCK OPTION TERMS AND CONDITIONS
1. Definitions
As used in these Stock Option Terms and Conditions, the following words
and phrases shall have the respective meanings ascribed to them below
unless the context in which any of them is used clearly indicates a
contrary meaning:
(a) Cashless Exercise: Cashless Exercise shall have the meaning set
forth in Section 3(a)(ii) herein.
(b) Change of Control: Change of Control shall have the same meaning as
such term has in Section 2(d) of the Plan.
(c) Xxxxxxx Xxxxxx: Xxxxxxx Xxxxxx & Co., Inc., the Stock Option
Administrator whom Rockwell Xxxxxxx has engaged to administer and
process all Option exercises.
(d) Committee: The Compensation and Management Development Committee of
the Board of Directors of Rockwell Xxxxxxx.
(e) Corporation: Rockwell Xxxxxxx and its Subsidiaries (as such term is
defined in the Plan).
(f) Customer Service Center: Xxxxxxx Xxxxxx'x Customer Service Center
that is used to facilitate Option transactions. Contact Xxxxxxx
Xxxxxx at (000) 000-0000.
(g) Employee: Employee shall have the same meaning as such term has in
Section 2(j) of the Plan.
(h) Exercise Request and Attestation Form: The form attached as Exhibit
1 or any other form accepted by Xxxxxxx Xxxxxx in connection with
the use of already-owned Shares to pay all or part of the exercise
price for the Option Shares to be purchased on exercise of any of
the Options.
(i) Options: The stock options listed in the first paragraph of the
letter dated [ ], to which these Stock Option Terms and Conditions
are attached and which together with these Stock Option Terms and
Conditions constitute the Stock Option Agreement.
(j) Option Shares: The shares of Rockwell Xxxxxxx Common Stock issuable
or transferable on exercise of the Options.
(k) Plan: Rockwell Xxxxxxx 2001 Long-Term Incentives Plan, as such Plan
may be amended and in effect at the relevant time.
(l) Rockwell Xxxxxxx: Xxxxxxxx Xxxxxxx, Inc., a Delaware corporation,
and any successor thereto.
(m) Schwab OptionCenter(R) : Xxxxxxx Xxxxxx'x stock option management
website which you can use to access your stock option account and to
facilitate stock option transactions securely on the web at
xxx.xxxxxx.xxx/xxxxxxxxxxxx.
(n) Shares: Shares of Rockwell Xxxxxxx Common Stock.
(o) Stock Option Agreement: These Stock Option Terms and Conditions
together with the letter dated [ ], to which they are attached.
2. When Options May be Exercised
The Options may be exercised, in whole or in part (but only for a whole
number of shares) and at one time or from time to time, as to one-third
(rounded to the nearest whole number) of the Option Shares during the
period beginning on [ ] and ending on [ ], as to an additional one-third
(rounded to the nearest whole number) of the Option Shares during the
period beginning on [ ] and ending on [ ] and as to the balance of the
Option Shares during the period beginning on [ ] and ending on [ ], and
only during those periods, and provided that:
(a) if you die while an Employee, any person who holds the Options as
permitted by Section 4 herein may exercise all the Options not
theretofore exercised within (and only within) the period beginning
on your date of death (even if you die before you have become
entitled to exercise all or any part of the Options) and ending
three years thereafter; and
(b) if your employment by the Corporation terminates other than by
death, then:
(i) if your retirement or other termination date is before [ ],
the Options shall lapse on your retirement or other
termination and may not be exercised at any time;
(ii) if your employment by the Corporation is terminated for cause,
as determined by the Committee, the Options shall expire
forthwith upon your termination and may not be exercised
thereafter;
-2-
(iii) if your employment by Rockwell Xxxxxxx terminates on or after
[ ] by reason of your retirement under a retirement plan of
Rockwell Xxxxxxx, or under a retirement plan of a subsidiary
or affiliate of Rockwell Xxxxxxx, you (or any person who holds
the Options as permitted by Section 4 herein) may thereafter
exercise Options which are exercisable prior to the date of
your retirement or that will become exercisable within (and
only within) the period between the date of your retirement
and ending on the fifth anniversary of your retirement date;
or if you retire prior to age 62, the earlier of (x) the fifth
anniversary of your retirement date or (y) such earlier date
as the Committee shall determine by action taken not later
than 60 days after your retirement date; and
(iv) if your employment by the Corporation terminates on or after
[ ] for any reason not specified in subparagraph (a) or in
clauses (ii) or (iii) of this subparagraph (b), you (or any
person who holds the Options as permitted by Section 4 herein)
may thereafter exercise the Options within (and only within)
the period ending three months after your termination date but
only to the extent such Options were exercisable on your
termination date.
In no event shall the provisions of the foregoing subparagraphs (a)
and (b) extend to a date after [ ], the period during which the
Options may be exercised.
Notwithstanding any other provision of this Agreement, if a Change
of Control shall occur, then all Options then outstanding pursuant
to this Agreement shall forthwith become fully exercisable whether
or not then otherwise exercisable in accordance with their terms.
3. Exercise Procedure
(a) To exercise all or any part of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must contact the
Stock Option Administrator, Xxxxxxx Xxxxxx, by using the Customer
Service Center or Schwab OptionCenter(R), as follows:
(i) contact the Customer Service Center by calling (000) 000-0000
Monday through Friday, 9:00 a.m. to 9:00 p.m. Eastern Time and
follow the instructions provided, or exercise via the Web
through the Schwab OptionCenter(R) at xxx.xxxxxx.xxx/
optioncenter;
(ii) confirm the Option transaction through the Customer Service
Center or Schwab OptionCenter(R);
-3-
(iii) at any time you may speak to a Customer Service Representative
for assistance by calling 000-000-0000;
(iv) full payment of the exercise price for the Option Shares to be
purchased on exercise of the Options may be made by:
- check (wire) to your Xxxxxxx Xxxxxx account; or
- in already-owned Shares; or
- by authorizing Xxxxxxx Xxxxxx or a third party
approved by Rockwell Xxxxxxx to sell the Shares
(or a sufficient portion of the Shares) acquired
upon exercise of the Option ("Cashless Exercise");
or
- in a combination of check (wire) to your Xxxxxxx
Xxxxxx account and Shares (whether already-owned
Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise); and
(v) in the case of an exercise of the Options by any person other
than you seeking to exercise the Options, such documents as
Xxxxxxx Xxxxxx or the Secretary of Rockwell Xxxxxxx shall
require to establish to their satisfaction that the person
seeking to exercise the Options is entitled to do so.
(b) An exercise of the whole or any part of the Options shall be
effective:
(i) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price for the
Option Shares entirely by check (wire), upon (A) completion of
your transaction by using the Customer Service Center or
Schwab OptionCenter(R) and full payment of the exercise price
and withholding taxes (if applicable) are received by Xxxxxxx
Xxxxxx within three business days following the exercise; and
(B) receipt of any documents required pursuant to Section
3(a)(v) herein; and
(ii) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price of the
Option Shares in Shares (whether already-owned Shares or
Shares issued and subsequently sold in connection with a
Cashless Exercise) or in a combination of Shares (whether
already-owned Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise) and check, upon (A)
completion of your transaction by using the Customer Service
Center or Schwab OptionCenter(R) and full payment of the
exercise price (as described in Section 3(d)(i) herein) and
withholding taxes (if applicable) are received by Xxxxxxx
-4-
Schwab within three business days following the exercise; and
(B) receipt of any documents required pursuant to Section
3(a)(v) herein.
(c) If you choose (or any person who holds the Options as permitted by
Section 4 herein chooses) to pay the exercise price for the Option
Shares to be purchased on exercise of any of the Options entirely by
check, payment must be made by:
- delivering to Xxxxxxx Xxxxxx a check (wire) in the full
amount of the exercise price for those Option Shares; or
- arranging with a stockbroker, bank or other financial
institution to deliver to Xxxxxxx Xxxxxx full payment,
by check or (if prior arrangements are made with Xxxxxxx
Xxxxxx) by wire transfer, of the exercise price of those
Option Shares.
In either event, in accordance with Section 3(e) herein, full
payment of the exercise price for the Option Shares purchased must
be made within three business days after the exercise has been
completed through the Customer Service Center or Schwab
OptionCenter(R).
(d) (i) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use already-owned
Shares to pay all or part of the exercise price for the Option
Shares to be purchased on exercise of any of the Options, you
(or any person who holds the Options as permitted by Section 4
herein) must deliver to Xxxxxxx Xxxxxx an Exercise Request and
Attestation Form and cash to cover the purchase of one Option
Share as specified in such form. To perform such a
transaction, the Exercise Request and Attestation Form must be
submitted via fax ((000) 000-0000) by 4:00 p.m. Eastern Time
on the date of exercise and any questions concerning this type
of transaction should be referred to (000) 000-0000 (Stock
Option Administration Group Hotline). The Exercise Request and
Attestation Form must attest to your ownership of Shares
representing:
- at least the number of Shares whose value, based
on the closing price of Common Stock of Rockwell
Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center or Schwab OptionCenter(R), equals
the exercise price for the Option Shares; or
- any lesser number of Shares you desire (or any
person who holds the Options as permitted by
Section 4 herein desires) to
-5-
use to pay the exercise price for those Option
Shares and a check in the amount of such exercise
price less the value of the Shares delivered,
based on the closing price of Common Stock of
Rockwell Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center or Schwab OptionCenter(R).
(ii) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use Option Shares
obtained by Cashless Exercise to pay all or part of the
exercise price for the remaining Option Shares to be purchased
on exercise of any of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must
contact the Customer Service Center at (000) 000-0000 or
Schwab OptionCenter(R).
(iii) Xxxxxxx Xxxxxx will advise you (or any other person who, being
entitled to do so, exercises the Options) of the exact number
of Shares, valued at the closing price on the New York Stock
Exchange -- Composite Transactions on the effective date of
exercise under Section 3(b)(ii) herein, and any funds required
to pay in full the exercise price for the Option Shares
purchased. In accordance with Section 3(e) herein, you (or
such other person) must pay, by check, in Shares or in a
combination of check and Shares, any balance required to pay
in full the exercise price of the Option Shares purchased
within three business days following the effective date of
such exercise of the Options under Section 3(b)(ii) herein.
(iv) Notwithstanding any other provision of this Stock Option
Agreement, the Secretary of Rockwell Xxxxxxx may limit the
number, frequency or volume of successive exercises of any of
the Options in which payment is made, in whole or in part, by
delivery of Shares pursuant to this subparagraph (d) to
prevent unreasonable pyramiding of such exercises.
(e) An exercise completed through the Customer Service Center or
Schwab OptionCenter(R), whether or not full payment of the
exercise price for the Option Shares is received by Xxxxxxx
Xxxxxx, shall constitute a binding contractual obligation by
you (or the other person entitled to exercise the Options) to
proceed with and complete that exercise of the Options (but
only so long as you continue, or the other person entitled to
exercise the Options continues, to be entitled to exercise
the Options on that date). By your acceptance of this Stock
Option Agreement, you agree (for yourself and on behalf of
any other person who becomes entitled to exercise the
Options) to pay to Xxxxxxx Xxxxxx in full the exercise price
for those Option Shares, that payment being by check, wire
transfer, in Shares or in a
-6-
combination of check and Shares, on or before the third business day
after the date on which you complete the transaction through the
Customer Service Center. If such payment is not made, you (for
yourself and on behalf of any other person who becomes entitled to
exercise the Options) authorize Rockwell Xxxxxxx, in its discretion,
to set off against salary payments or other amounts due or which may
become due you (or the other person entitled to exercise the
Options) any balance of the exercise price for those Option Shares
remaining unpaid thereafter.
(f) An Exercise Confirmation representing the number of Option Shares
purchased will be issued the third business day (trade date plus
three business days) (i) after Xxxxxxx Xxxxxx has received full
payment therefor or (ii) at Rockwell Xxxxxxx' or Xxxxxxx Xxxxxx'x
election in their sole discretion, after Rockwell Xxxxxxx or Xxxxxxx
Xxxxxx has received (x) full payment of the exercise price of those
Option Shares and (y) any reimbursement in respect of withholding
taxes due pursuant to Section 5 herein.
4. Transferability; Nonassignability
You are not entitled to transfer the Options except by will or by the laws
of descent and distribution.
5. Withholding
Rockwell Xxxxxxx or Xxxxxxx Xxxxxx shall have the right, in connection
with the exercise of the Options, in whole or in part, to deduct from any
payment to be made by Rockwell Xxxxxxx or Xxxxxxx Xxxxxx an amount equal
to the taxes required to be withheld by law with respect to such exercise
or to require you (or any other person entitled to exercise the Options)
to pay to it an amount sufficient to provide for any such taxes so
required to be withheld. By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) that if Rockwell Xxxxxxx or
Xxxxxxx Xxxxxx elects to require you (or such other person) to remit an
amount sufficient to pay such withholding taxes, you (or such other
person) must remit that amount within three business days after the
completion of the Option exercise as provided in Section 3(a)(ii) herein.
If such payment is not made, Rockwell Xxxxxxx, in its discretion, shall
have the same right of set-off as provided under Section 3(e) herein with
respect to payment of the exercise price for Option Shares.
6. Headings
The section headings contained in these Stock Option Terms and Conditions
are solely for the purpose of reference, are not part of the agreement of
the parties and shall in no way affect the meaning or interpretation of
this Stock Option Agreement.
-7-
7. References
All references in these Stock Option Terms and Conditions to Sections,
paragraphs, subparagraphs or clauses shall be deemed to be references to
Sections, paragraphs, subparagraphs and clauses of these Stock Option
Terms and Conditions unless otherwise specifically provided.
8. Entire Agreement
This Stock Option Agreement and the other terms applicable to Stock
Options granted under the Plan embody the entire agreement and
understanding between Rockwell Xxxxxxx and you with respect to the
Options, and there are no representations, promises, covenants, agreements
or understandings with respect to the Options other than those expressly
set forth in this Stock Option Agreement and the Plan.
9. Applicable Laws and Regulations
This Stock Option Agreement and Rockwell Xxxxxxx obligation to issue
Option Shares hereunder are subject to applicable laws and regulations.
Exhibit 1 Exercise Request and Attestation Form (For Use With Already-
Owned Shares)
-8-
2001 LONG-TERM INCENTIVES PLAN
FORM OF OPTION AGREEMENT
[NEW ARBITRATION AGREEMENT]
[Grant Date]
To:
Social Security/Account Number:
Dear Optionee:
We are pleased to notify you that you have been granted the following stock
options under the 2001 Long-Term Incentives Plan (the "Plan"):
Date of Grant Type of Grant Number of Shares Option Price
------------- ------------- ---------------- ------------
These stock options (the "Options") have been granted under and may be exercised
only upon the terms and conditions of this Stock Option Agreement, subject in
all respects to the provisions of the Plan, as it may be amended. The enclosed
Stock Option Terms and Conditions are incorporated in and are part of this Stock
Option Agreement.
This stock option grant is also subject to the condition that you sign and
return one copy of the Mutual Agreement to Arbitrate Claims to:
Rockwell Xxxxxxx, Inc.
Office of the Secretary
000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
These stock option(s) will be of no effect if the copy of the Mutual Agreement
to Arbitrate Claims, properly signed by you, is not received by the Secretary of
Rockwell Xxxxxxx, Inc. on or before [ ], unless Rockwell Xxxxxxx, Inc. (in its
sole discretion) elects in writing to extend that date.
A copy of the Plan and Plan Prospectus are enclosed. Please carefully read the
enclosed documents and retain them for future reference.
ROCKWELL XXXXXXX, INC.
By:
[TERMS AND CONDITIONS -- STANDARD, NQ]
ROCKWELL XXXXXXX, INC.
2001 LONG-TERM INCENTIVES PLAN
STOCK OPTION AGREEMENT
STOCK OPTION TERMS AND CONDITIONS
1. Definitions
As used in these Stock Option Terms and Conditions, the following words
and phrases shall have the respective meanings ascribed to them below
unless the context in which any of them is used clearly indicates a
contrary meaning:
(a) Cashless Exercise: Cashless Exercise shall have the meaning set
forth in Section 3(a)(ii) herein.
(b) Change of Control: Change of Control shall have the same meaning as
such term has in Section 2(d) of the Plan.
(c) Xxxxxxx Xxxxxx: Xxxxxxx Xxxxxx & Co., Inc., the Stock Option
Administrator whom Rockwell Xxxxxxx has engaged to administer and
process all Option exercises.
(d) Committee: The Compensation and Management Development Committee of
the Board of Directors of Rockwell Xxxxxxx.
(e) Corporation: Rockwell Xxxxxxx and its Subsidiaries (as such term is
defined in the Plan).
(f) Customer Service Center: Xxxxxxx Xxxxxx'x Customer Service Center
that is used to facilitate Option transactions. Contact Xxxxxxx
Xxxxxx at (000) 000-0000.
(g) Employee: Employee shall have the same meaning as such term has in
Section 2(j) of the Plan.
(h) Exercise Request and Attestation Form: The form attached as Exhibit
1 or any other form accepted by Xxxxxxx Xxxxxx in connection with
the use of already-owned Shares to pay all or part of the exercise
price for the Option Shares to be purchased on exercise of any of
the Options.
(i) Options: The stock options listed in the first paragraph of the
letter dated [ ], to which these Stock Option Terms and Conditions
are attached and which together with these Stock Option Terms and
Conditions constitute the Stock Option Agreement.
(j) Option Shares: The shares of Rockwell Xxxxxxx Common Stock issuable
or transferable on exercise of the Options.
(k) Plan: Rockwell Xxxxxxx 2001 Long-Term Incentives Plan, as such Plan
may be amended and in effect at the relevant time.
(l) Rockwell Xxxxxxx: Xxxxxxxx Xxxxxxx, Inc., a Delaware corporation,
and any successor thereto.
(m) Schwab OptionCenter(R) : Xxxxxxx Xxxxxx'x stock option management
website which you can use to access your stock option account and to
facilitate stock option transactions securely on the web at
xxx.xxxxxx.xxx/xxxxxxxxxxxx.
(n) Shares: Shares of Rockwell Xxxxxxx Common Stock.
(o) Stock Option Agreement: These Stock Option Terms and Conditions
together with the letter dated [ ], to which they are attached.
2. When Options May be Exercised
The Options may be exercised, in whole or in part (but only for a whole
number of shares) and at one time or from time to time, as to one-third
(rounded to the nearest whole number) of the Option Shares during the
period beginning on [ ] and ending on [ ], as to an additional one-third
(rounded to the nearest whole number) of the Option Shares during the
period beginning on [ ] and ending on [ ] and as to the balance of the
Option Shares during the period beginning on [ ] and ending on [ ], and
only during those periods, and provided that:
(a) if you die while an Employee, any person who holds the Options as
permitted by Section 4 herein may exercise all the Options not
theretofore exercised within (and only within) the period beginning
on your date of death (even if you die before you have become
entitled to exercise all or any part of the Options) and ending
three years thereafter; and
(b) if your employment by the Corporation terminates other than by
death, then:
(i) if your retirement or other termination date is before [ ],
the Options shall lapse on your retirement or other
termination and may not be exercised at any time;
(ii) if your employment by the Corporation is terminated for cause,
as determined by the Committee, the Options shall expire
forthwith upon your termination and may not be exercised
thereafter;
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(iii) if your employment by Rockwell Xxxxxxx terminates on or after
[ ] by reason of your retirement under a retirement plan of
Rockwell Xxxxxxx, or under a retirement plan of a subsidiary
or affiliate of Rockwell Xxxxxxx, you (or any person who holds
the Options as permitted by Section 4 herein) may thereafter
exercise Options which are exercisable prior to the date of
your retirement or that will become exercisable within (and
only within) the period between the date of your retirement
and ending on the fifth anniversary of your retirement date;
or if you retire prior to age 62, the earlier of (x) the fifth
anniversary of your retirement date or (y) such earlier date
as the Committee shall determine by action taken not later
than 60 days after your retirement date; and
(iv) if your employment by the Corporation terminates on or after
[ ] for any reason not specified in subparagraph (a) or in
clauses (ii) or (iii) of this subparagraph (b), you (or any
person who holds the Options as permitted by Section 4 herein)
may thereafter exercise the Options within (and only within)
the period ending three months after your termination date but
only to the extent such Options were exercisable on your
termination date.
In no event shall the provisions of the foregoing subparagraphs (a)
and (b) extend to a date after [ ], the period during which the
Options may be exercised.
Notwithstanding any other provision of this Agreement, if a Change
of Control shall occur, then all Options then outstanding pursuant
to this Agreement shall forthwith become fully exercisable whether
or not then otherwise exercisable in accordance with their terms.
3. Exercise Procedure
(a) To exercise all or any part of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must contact the
Stock Option Administrator, Xxxxxxx Xxxxxx, by using the Customer
Service Center or Schwab OptionCenter(R), as follows:
(i) contact the Customer Service Center by calling (000) 000-0000
Monday through Friday, 9:00 a.m. to 9:00 p.m. Eastern Time and
follow the instructions provided, or exercise via the Web
through the Schwab OptionCenter(R) at xxx.xxxxxx.xxx/
optioncenter;
(ii) confirm the Option transaction through the Customer Service
Center or Schwab OptionCenter(R);
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(iii) at any time you may speak to a Customer Service Representative
for assistance by calling (000) 000-0000;
(iv) full payment of the exercise price for the Option Shares to be
purchased on exercise of the Options may be made by:
- check (wire) to your Xxxxxxx Xxxxxx account; or
- in already-owned Shares; or
- by authorizing Xxxxxxx Xxxxxx or a third party
approved by Rockwell Xxxxxxx to sell the Shares
(or a sufficient portion of the Shares) acquired
upon exercise of the Option ("Cashless Exercise");
or
- in a combination of check (wire) to your Xxxxxxx
Xxxxxx account and Shares (whether already-owned
Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise); and
(v) in the case of an exercise of the Options by any person other
than you seeking to exercise the Options, such documents as
Xxxxxxx Xxxxxx or the Secretary of Rockwell Xxxxxxx shall
require to establish to their satisfaction that the person
seeking to exercise the Options is entitled to do so.
(b) An exercise of the whole or any part of the Options shall be
effective:
(i) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price for the
Option Shares entirely by check (wire), upon (A) completion of
your transaction by using the Customer Service Center or
Schwab OptionCenter(R) and full payment of the exercise price
and withholding taxes (if applicable) are received by Xxxxxxx
Xxxxxx within three business days following the exercise; and
(B) receipt of any documents required pursuant to Section
3(a)(v) herein; and
(ii) if you elect (or any person who holds the Options as permitted
by Section 4 herein elects) to pay the exercise price of the
Option Shares in Shares (whether already-owned Shares or
Shares issued and subsequently sold in connection with a
Cashless Exercise) or in a combination of Shares (whether
already-owned Shares or Shares issued and subsequently sold in
connection with a Cashless Exercise) and check, upon (A)
completion of your transaction by using the Customer Service
Center or Schwab OptionCenter(R) and full payment of the
exercise price (as described in Section 3(d)(i) herein) and
withholding taxes (if applicable) are received by Xxxxxxx
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Schwab within three business days following the exercise; and
(B) receipt of any documents required pursuant to Section
3(a)(v) herein.
(c) If you choose (or any person who holds the Options as permitted by
Section 4 herein chooses) to pay the exercise price for the Option
Shares to be purchased on exercise of any of the Options entirely by
check, payment must be made by:
- delivering to Xxxxxxx Xxxxxx a check (wire) in the full
amount of the exercise price for those Option Shares; or
- arranging with a stockbroker, bank or other financial
institution to deliver to Xxxxxxx Xxxxxx full payment,
by check or (if prior arrangements are made with Xxxxxxx
Xxxxxx) by wire transfer, of the exercise price of those
Option Shares.
In either event, in accordance with Section 3(e) herein, full
payment of the exercise price for the Option Shares purchased must
be made within three business days after the exercise has been
completed through the Customer Service Center or Schwab
OptionCenter(R).
(d) (i) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use already-owned
Shares to pay all or part of the exercise price for the Option
Shares to be purchased on exercise of any of the Options, you
(or any person who holds the Options as permitted by Section 4
herein) must deliver to Xxxxxxx Xxxxxx an Exercise Request and
Attestation Form and cash to cover the purchase of one Option
Share as specified in such form. To perform such a
transaction, the Exercise Request and Attestation Form must be
submitted via fax ((000) 000-0000) by 4:00 p.m. Eastern Time
on the date of exercise and any questions concerning this type
of transaction should be referred to (000) 000-0000 (Stock
Option Administration Group Hotline). The Exercise Request and
Attestation Form must attest to your ownership of Shares
representing:
- at least the number of Shares whose value, based
on the closing price of Common Stock of Rockwell
Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center or Schwab OptionCenter(R), equals
the exercise price for the Option Shares; or
- any lesser number of Shares you desire (or any
person who holds the Options as permitted by
Section 4 herein desires) to
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use to pay the exercise price for those Option
Shares and a check in the amount of such exercise
price less the value of the Shares delivered,
based on the closing price of Common Stock of
Rockwell Xxxxxxx on the New York Stock Exchange --
Composite Transactions on the day you have
exercised your Options through the Customer
Service Center or Schwab OptionCenter(R).
(ii) If you choose (or any person who holds the Options as
permitted by Section 4 herein chooses) to use Option Shares
obtained by Cashless Exercise to pay all or part of the
exercise price for the remaining Option Shares to be purchased
on exercise of any of the Options, you (or any person who
holds the Options as permitted by Section 4 herein) must
contact the Customer Service Center at (000) 000-0000 or
Schwab OptionCenter(R).
(iii) Xxxxxxx Xxxxxx will advise you (or any other person who, being
entitled to do so, exercises the Options) of the exact number
of Shares, valued at the closing price on the New York Stock
Exchange -- Composite Transactions on the effective date of
exercise under Section 3(b)(ii) herein, and any funds required
to pay in full the exercise price for the Option Shares
purchased. In accordance with Section 3(e) herein, you (or
such other person) must pay, by check, in Shares or in a
combination of check and Shares, any balance required to pay
in full the exercise price of the Option Shares purchased
within three business days following the effective date of
such exercise of the Options under Section 3(b)(ii) herein.
(iv) Notwithstanding any other provision of this Stock Option
Agreement, the Secretary of Rockwell Xxxxxxx may limit the
number, frequency or volume of successive exercises of any of
the Options in which payment is made, in whole or in part, by
delivery of Shares pursuant to this subparagraph (d) to
prevent unreasonable pyramiding of such exercises.
(e) An exercise completed through the Customer Service Center or Schwab
OptionCenter(R), whether or not full payment of the exercise price
for the Option Shares is received by Xxxxxxx Xxxxxx, shall
constitute a binding contractual obligation by you (or the other
person entitled to exercise the Options) to proceed with and
complete that exercise of the Options (but only so long as you
continue, or the other person entitled to exercise the Options
continues, to be entitled to exercise the Options on that date). By
your acceptance of this Stock Option Agreement, you agree (for
yourself and on behalf of any other person who becomes entitled to
exercise the Options) to pay to Xxxxxxx Xxxxxx in full the exercise
price for those Option Shares, that payment being by check, wire
transfer, in Shares or in a
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combination of check and Shares, on or before the third business day
after the date on which you complete the transaction through the
Customer Service Center. If such payment is not made, you (for
yourself and on behalf of any other person who becomes entitled to
exercise the Options) authorize Rockwell Xxxxxxx, in its discretion,
to set off against salary payments or other amounts due or which may
become due you (or the other person entitled to exercise the
Options) any balance of the exercise price for those Option Shares
remaining unpaid thereafter.
(f) An Exercise Confirmation representing the number of Option Shares
purchased will be issued the third business day (trade date plus
three business days) (i) after Xxxxxxx Xxxxxx has received full
payment therefor or (ii) at Rockwell Xxxxxxx' or Xxxxxxx Xxxxxx'x
election in their sole discretion, after Rockwell Xxxxxxx or Xxxxxxx
Xxxxxx has received (x) full payment of the exercise price of those
Option Shares and (y) any reimbursement in respect of withholding
taxes due pursuant to Section 5 herein.
4. Transferability; Nonassignability
You are not entitled to transfer the Options except by will or by the laws
of descent and distribution.
5. Withholding
Rockwell Xxxxxxx or Xxxxxxx Xxxxxx shall have the right, in connection
with the exercise of the Options, in whole or in part, to deduct from any
payment to be made by Rockwell Xxxxxxx or Xxxxxxx Xxxxxx an amount equal
to the taxes required to be withheld by law with respect to such exercise
or to require you (or any other person entitled to exercise the Options)
to pay to it an amount sufficient to provide for any such taxes so
required to be withheld. By your acceptance of this Stock Option
Agreement, you agree (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) that if Rockwell Xxxxxxx or
Xxxxxxx Xxxxxx elects to require you (or such other person) to remit an
amount sufficient to pay such withholding taxes, you (or such other
person) must remit that amount within three business days after the
completion of the Option exercise as provided in Section 3(a)(ii) herein.
If such payment is not made, Rockwell Xxxxxxx, in its discretion, shall
have the same right of set-off as provided under Section 3(e) herein with
respect to payment of the exercise price for Option Shares.
6. Headings
The section headings contained in these Stock Option Terms and Conditions
are solely for the purpose of reference, are not part of the agreement of
the parties and shall in no way affect the meaning or interpretation of
this Stock Option Agreement.
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7. References
All references in these Stock Option Terms and Conditions to Sections,
paragraphs, subparagraphs or clauses shall be deemed to be references to
Sections, paragraphs, subparagraphs and clauses of these Stock Option
Terms and Conditions unless otherwise specifically provided.
8. Entire Agreement
This Stock Option Agreement and the other terms applicable to Stock
Options granted under the Plan embody the entire agreement and
understanding between Rockwell Xxxxxxx and you with respect to the
Options, and there are no representations, promises, covenants, agreements
or understandings with respect to the Options other than those expressly
set forth in this Stock Option Agreement and the Plan.
9. Applicable Laws and Regulations
This Stock Option Agreement and Rockwell Xxxxxxx obligation to issue
Option Shares hereunder are subject to applicable laws and regulations.
Exhibit 1 Exercise Request and Attestation Form (For Use With Already-
Owned Shares)
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