NON-QUALIFIED STOCK OPTION AGREEMENT NICOR INC. 1997 LONG-TERM INCENTIVE PLAN
Form
10-Q
Exhibit
10.10
NICOR
INC. 1997 LONG-TERM INCENTIVE PLAN
THIS
AGREEMENT, entered into as of the 16th day of March, 2006 (the "Agreement
Date"), by and between «First_Name» «MiName» «Last_Name»
(the
"Employee"), and Nicor Inc., an Illinois corporation (the
"Company"),
WITNESSETH
THAT:
WHEREAS,
the Company maintains the Nicor Inc. 1997 Long-Term Incentive Plan (the “Plan”),
which is incorporated into and forms a part of this Agreement, for the benefit
of key executive and management employees of the Company and any Related
Company; and
WHEREAS,
the Employee has been selected to receive a Non-Qualified Stock Option award
under the Plan;
NOW,
THEREFORE, IT IS AGREED, by and between the Company and the Employee, as
follows:
1. Award,
Purchase Price.
Subject
to the terms of this Agreement and the Plan, the Employee is hereby awarded
an
option to purchase a total of «SO»
shares
of Stock (the "Option"). The option price of each share of Stock subject to
the
Option shall be $41.62. The Option is not intended, and will not be treated,
as
an incentive stock option (as that term is used in section 422 of the
Code).
2. Date
of Exercise.
Subject
to the provisions of paragraph 4 and this paragraph 2, the Option shall first
be
exercisable (1) commencing on the third anniversary of the Agreement Date
provided that the Employee remains continuously employed through such date,
or
(2) upon the Employee’s Retirement (as defined below), death or termination of
employment provided such Retirement, or death or termination of employment
is on
or after March 16, 2007. If the Employee terminates employment for any reason
prior to March 16, 2007, the Option shall expire and shall be cancelled.
The
Option shall expire and shall no longer be exercisable on the earlier of: (a)
the tenth anniversary of the Agreement Date (which shall be the Expiration
Date
described in the Plan), or (b) the date of termination of employment if
termination occurs for cause, or (c) three months following termination of
employment for any reason other than death, disability, Retirement or cause,
or
(d) at such earlier time as may be required by the Plan upon termination of
employment.
3. Method
of Option Exercise.
The
Option may be exercised in whole or in part by filing a written notice with
the
Secretary of the Company at its corporate headquarters prior to the date the
Option expires. Such notice shall specify the number of shares of Stock which
the Employee elects to purchase, and shall be accompanied by payment of the
option price for such shares of Stock indicated by the Employee's election.
Subject to the provisions of the following sentence, payment shall be by cash
or
by check payable to the Company. Except as otherwise limited by the Compensation
Committee of the Board of Directors of the Company (the "Committee"), all or
a
portion of such required amount may be paid by delivery of shares of Stock
having an aggregate Fair Market Value (valued as of the date of exercise) that
is equal to the amount of cash which would otherwise be required.
4. Change
in Control.
In the
event that a change in control occurs prior to the date on which the Employee
completes three continuous years of employment with the Company or any Related
Company after the Agreement Date, the Employee shall have the right to
immediately exercise the Option.
5. Heirs
and Successors.
This
Agreement shall be binding upon, and inure to the benefit of, the Company and
its successors and assigns, and upon any person acquiring, whether by merger,
consolidation, purchase of assets or otherwise, all or substantially all of
the
Company's assets and business. Subject to the terms of the Plan, any benefits
payable to the Employee under this Agreement that are not paid at the time
of
the Employee's death shall be paid at the time and in the form determined in
accordance with the foregoing provisions of this Agreement, to the beneficiary
designated by the Employee in writing filed with the Committee in such form
and
at such time as the Committee shall require. If a deceased Employee fails to
designate a beneficiary, or if the designated beneficiary of the deceased
Employee dies before the Employee or before complete payment of the amounts
distributable under this Agreement, the Committee shall, in its discretion,
direct that amounts to be paid under this Agreement be paid to:
|
(a)
|
one
or more of the Employee's relatives by blood, adoption or marriage
and in
such proportion as the Committee decides;
or
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(b)
|
the
legal representative or representatives of the estate of the last
to die
of the Employee and his
beneficiary.
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6. Retirement.
For
purposes of this Agreement, the term "Retirement" means: (a) termination of
employment because the Employee has reached normal retirement age of 65 years;
(b)
termination of employment because the Employee becomes Disabled; or (c)
termination of employment before age 65 because of early retirement pursuant
to
any plan of the Company or a Related Company that covers the Employee and that
is qualified under section 401(a) of the Code. For purposes of this Agreement,
the term "Disabled" means the inability of the Employee, by reason of a
medically determinable physical or mental impairment, to engage in any
substantial gainful activity, which condition, in the opinion of a physician
selected by the Committee, is expected to be total and permanent during the
remainder of the Employee's lifetime.
7. Transferability.
Stock
Options awarded under this Agreement are not transferable except as designated
by the Employee by will or by the laws of descent and distribution.
Notwithstanding the foregoing, the Committee may permit Stock Options awarded
under this Agreement to be transferred by a participant for no consideration
to
or for the benefit of the participant's immediate family (including a trust
for
the benefit of a participant's immediate family or to a partnership for members
of a participant's immediate family), subject to such limits as the Committee
may establish, and the transferee shall remain subject to all terms and
conditions applicable to such award prior to such transfer. Immediate family
is
defined as the participant's spouse, children, stepchildren and adoptive
relationships.
8. Adjustment
to Number of Shares Subject to Agreement.
In the
event of any change in the outstanding shares of Company Stock by reason of
any
stock dividend, split, spin-off, recapitalization, merger, consolidation,
combination, exchange of shares or other similar change, the terms of this
Agreement and the number of Stock Options subject to this Agreement may be
equitably adjusted by the Committee in its sole discretion to preserve the
intent of this Agreement.
9. Employment.
This
Agreement does not constitute a contract of employment, and does not confer
on
the Employee the right to be retained in the employ of the Company or any
Related Company.
2
10. Definitions.
Except
where the context clearly implies or indicates the contrary, a word, term,
or
phrase used in the Plan is similarly used in this Agreement.
11. Administration.
The
authority to manage and control the operation and administration of this
Agreement shall be vested in the Committee, and the Committee shall have all
powers with respect to this Agreement as it has with respect to the Plan. Any
interpretation of the Agreement by the Committee and any decision made by it
with respect to the Agreement is final and binding on all persons.
12. Plan
Governs.
Notwithstanding anything in this Agreement to the contrary, the terms of this
Agreement shall be subject to the terms of the Plan, copies of which may be
obtained by the Employee from the office of the Secretary of the
Company.
13. Amendment.
This
Agreement may be amended by written Agreement of the Employee and the Company,
without the consent of any other person.
IN
WITNESS WHEREOF, the Employee has hereunto set his hand, and the Company has
caused these presents to be executed in its name and on its behalf, and its
corporate seal to be affixed hereto, all as of the Agreement Date.
________________________________
«First_Name» «MiName» «Last_Name»
By:
______________________
Xxxx
X.
Xxxxxxx
Chairman,
President and
Chief
Executive Officer
ATTEST:
____________________________
Assistant
Secretary
