EX-10.HH
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AMP Incorporated
NONQUALIFIED STOCK OPTION AGREEMENT
For the purpose of (a) encouraging key employees to acquire a proprietary
interest in the Common Stock of AMP Incorporated (the "Corporation"), thereby
aligning their interests with the interests of the shareholders, (b) providing
added incentive to key employees to contribute to the future growth and
profitability of the Corporation and (c) attracting and retaining exceptionally
qualified employees, the Corporation, pursuant to the terms and conditions of
the AMP Incorporated 1993 Long-Term Equity Incentive Plan (the "Plan"), will
award Options to purchase Common Stock to certain participants.
This Agreement, entered into pursuant to the terms of the Plan, evidences
that the Committee has designated ("Participant") as a participant under the
Plan, has awarded Nonqualified Stock Options to Participant, has designated as
the Award Date for such Options, has designated the sum of $ as the Exercise
Price applicable to each such Option, and has designated the period from to as
the Exercise Period applicable to such Options.
The grant, holding, and exercise of such Nonqualified Stock Options shall
be subject to the terms and conditions of the Plan and the following:
Article I. Definitions.
1.1. "Agreement" means this "Nonqualified Stock Option Agreement" between
the Corporation and Participant.
1.2. "Award" shall mean any grant of Nonqualified Stock Options made to
Participant under the Plan and this Agreement.
1.3. "Award Date" means the date designated by the Committee as of which
Options are awarded to Participant under the Plan.
1.4. "Board" shall mean the Board of Directors of the Corporation.
1.5. "Change in Control" shall have the meaning set forth in Section 5.4
hereof.
1.6. "Committee" means the committee of the Board as described in Section
2(h) of the Plan.
1.7. "Common Stock" means common stock of the Corporation, no par value.
1.8. "Competing Business" means, as applied to a particular period of time,
a business which at such time is engaged in the manufacture, sale or other
disposition of a product or products which is in competition to a product or
products of the Corporation or its subsidiaries, partnerships or joint ventures.
1.9. "Corporation" shall have the meaning set forth in the first paragraph
of this Agreement.
1.10. "Exchange Act" means the Securities Exchange Act of 1934, as amended.
1.11. "Exercise Period" means the period of time specified by the Committee
on the Award Date and set forth in the second paragraph of this Agreement within
which a Participant may exercise an Option, which period has been determined by
the Committee pursuant to the Plan, subject however to the Committee's exercise
of its discretion pursuant to Section 4.1 hereof and to the terms of Sections
3.1, 3.2 and 5.4 hereof.
1.12. "Exercise Price" means the price specified by the Committee and set
forth in the second paragraph of this Agreement at which the Participant may
exercise an Option during the Exercise Period, which price has been determined
by the Committee pursuant to the Plan.
1.13. "Fair Market Value" means the closing sales price of a Share as
reflected on the New York Stock Exchange Composite Tape for the relevant date.
1.14. "Nonqualified Stock Option" or "Option" means a right granted under
the Plan and this Agreement to purchase a single Share at a specified Exercise
Price within a specified Exercise Period, which right is not intended to be an
incentive stock option meeting the requirements of Section 422 of the Internal
Revenue Code of 1986 or does not qualify as an incentive stock option.
1.15. "Participant" shall have the meaning set forth in the second
paragraph of this Agreement.
1.16. "Securities Act" means the Securities Act of 1933, as amended.
1.17. "Share" or "Shares" means a share or shares of Common Stock.
1.18. "Termination of Employment" means the termination of employment by
the Corporation or by a subsidiary, but not the transfer of employment from the
Corporation to a subsidiary of the Corporation or vice versa or from one
subsidiary of the Corporation to another such subsidiary. If the Committee in
its sole discretion so determines, employment shall not be considered as
terminated for the purposes of Section 3.1 so long as Participant continues to
perform services for the Corporation or a subsidiary thereof on either a full or
part time basis either as an independent contractor or on a consulting basis or
otherwise, provided, however, that Participant during such period does not,
whether full time or part time, engage in or perform any services as an
employee, independent contractor, consultant, advisor, or otherwise for a
Competing Business.
Article II. Exercise of Options.
2.1. "Person Eligible to Exercise": During Participant's lifetime, only
Participant or, in the event of disability, Participant's guardian or legal
representative may exercise an Option granted under the Plan. After the death of
Participant, any Options held by Participant prior to death that continue to be
exercisable may be exercised by Participant's personal representative or by any
person empowered to do so by will or by the laws of descent and distribution.
The terms of the Plan and this Agreement, as well as the interpretations and
decisions of the Committee, shall be binding upon any such guardian, legal
representative, personal representative, or other person acting on behalf or in
lieu of the Participant.
2.2. "Manner of Exercise": Participant may exercise an Option on any
business day of the Corporation within the Exercise Period by delivery to the
Secretary of the Corporation at the Corporation's principal office, either by
mail, facsimile, or in person, of a properly completed notice of exercise, on a
form approved by the Secretary, together with full payment of the aggregate
Exercise Price and the Federal, state and local tax withholding obligation as
provided in Sections 2.3 and 5.1 hereof. The date such form is received by the
Secretary shall be the date of exercise. Such form shall specify the
Participant, Participant's Social Security number, the Award Date, the number of
the Options being exercised, the aggregate Exercise Price, and the manner in
which the Participant intends to satisfy the resultant tax withholding
obligation. The minimum number of Options that may be exercised at any one time
shall be 100 or, if less, the aggregate number of outstanding Options then
credited to Participant and exercisable. In the event the Option is being
exercised pursuant to Section 2.1 by any person other than Participant, such
person shall also submit at the time of exercise satisfactory proof of the right
of such person to exercise the Option.
2.3. "Payment and Issuance": Shares acquired pursuant to the exercise of
Options shall be paid for in full at the time of exercise, either in the form of
cash, Common Stock (whether by previously owned Shares or by having the
Corporation withhold a portion of the Shares to be received) having a value
based on Fair Market Value on the date of exercise equal to the aggregate
Exercise Price, or in a combination thereof, as the Committee may determine. Any
election to have the Corporation withhold Shares to be received under the Plan
and this Agreement for the purpose of paying the Exercise Price will be subject
to such restrictions as the Committee, in its discretion, may hereafter
determine. A certificate for the net amount of Shares attributable to an
exercise shall be issued to Participant as soon as practicable following payment
of the aggregate Exercise Price and all applicable withholding taxes.
2.4. "Non-Registration": In the event the Shares to be issued hereunder
upon the exercise of an Option have not been registered under the Securities Act
or a registration is not then currently effective with respect to such Shares,
the Participant shall deliver to the Corporation, as a condition to the exercise
of any Option awarded under this Agreement, at the time of such exercise, a bona
fide written representation and agreement, in a form satisfactory to the
Committee, signed by Participant or other person then entitled to exercise such
Option, stating that the Shares are being acquired for his or her own account,
for investment and without any present intention of distribution or reselling
said Shares, or any of them, except as may be permitted under the Securities Act
and then applicable rules and regulations thereunder, and that Participant or
other person then entitled to exercise such Option will indemnify the
Corporation against and hold it free and harmless from any loss, damages,
expense or liability resulting to the Corporation if any sale or distribution of
the Shares by such person is contrary to the representation and agreement
referred to above. The Committee may take whatever additional actions it
reasonably deems appropriate to ensure the observance and performance of such
representation and agreement and to effect compliance with the Securities Act
and any other Federal or state securities laws or regulations, including but not
limited to Rule 144 promulgated under the Securities Act. Without limiting the
generality of the foregoing, the Committee may require an opinion of counsel
acceptable to it to the effect that any subsequent transfer of Shares acquired
on an Option exercise does not violate the Securities Act, and may issue
stop-transfer orders covering such Shares. Share certificates evidencing Shares
issued on exercise of such Option shall bear an appropriate legend referring to
the provisions of this Section and the agreements herein.
Article III. Termination of Employment.
3.1. "Rights Upon Termination of Employment": In the event that Participant
experiences a Termination of Employment for any cause, all Options will
terminate immediately or as the Committee may determine in its sole discretion.
In the event an Option is continued beyond a Termination of Employment, in no
event will it be continued beyond the end of the Exercise Period specified in
this Agreement.
3.2. "Fulfillment of Conditions": Any extension by the Committee of the
term of an Option beyond the date of a Termination of Employment shall be
contingent on such conditions as the Committee, in its sole discretion, may
determine, including but not limited to the fulfillment of the conditions that:
(a) Participant shall not, whether full time or part time, as an employee,
on a consulting or advisory basis or otherwise, engage in or perform any
services during the period between the date of Participant's Termination of
Employment and the date of Participant's exercise and payment of the extended
Option for a business which at such time shall be a Competing Business, nor
shall Participant at any time (i) disclose information relative to the business
of the Corporation and its subsidiaries which is confidential or (ii) otherwise
act or conduct himself in a manner which is inimical or contrary to the best
interest of the Corporation and its subsidiaries, and
(b) The Participant shall be available during the period between the date
of Participant's Termination of Employment and the date of Participant's
exercise and payment of the extended Option for such consulting and advisory
services as the Corporation or its subsidiaries may reasonably request, taking
fairly into consideration the age, health, residence and individual
circumstances of the Participant and the total value of the Options held by the
Participant under the Plan during the Exercise Period.
In the event that any of such conditions shall not be fulfilled, the
obligations of the Corporation hereunder shall forthwith terminate, as shall the
extension of the terms of any Options hereunder; provided that any such
cancellation shall be in addition to and not in lieu of any of the rights or
remedies available to the Corporation or its subsidiaries arising out of
Participant's breach of any provision of this Agreement or the Plan. Ownership
as a passive investor of not more than five percent (5%) of the outstanding
shares of the stock of any company listed on a national securities exchange or
having at least one hundred (100) shareholders of record shall not in itself be
deemed a nonfulfillment of the conditions herein set forth.
Article IV. Administration of Plan.
4.1. "Committee": The Committee shall administer the Plan and this
Agreement in accordance with their provisions and shall have full and final
authority in its discretion to (a) interpret the provisions of the Plan and this
Agreement and decide all questions of fact arising in their application, and its
interpretations and decisions shall be in all respects final, conclusive and
binding; and (b) make all other determinations, rules and regulations necessary
or advisable for the administration of the Plan and this Agreement.
Notwithstanding any provisions of this Agreement to the contrary, the Committee
shall have the power to permit, in its discretion, an acceleration of any
previously determined Option exercise terms or to otherwise amend the terms of
an Option, under such circumstances and upon such modified or different terms
and conditions as it deems appropriate, subject, however, to the provisions of
the Plan. No member of the Committee shall be personally liable for any action
or determination in respect to the administration of the Plan and this Agreement
if made in good faith.
Article V. Miscellaneous.
5.1. "Withholding of Taxes": Whenever the Corporation proposes or is
required to issue or transfer Shares under the Plan and this Agreement, the
Corporation shall have the right to require Participant to remit to the
Corporation an amount sufficient to satisfy any Federal, state and/or local
withholding tax requirements prior to the delivery of any certificate or
certificates for such Shares. Withholding requirements may be satisfied by cash
payments or, at the election of Participant, by having the Corporation withhold
a portion of the Shares to be received, or by delivering previously owned
Shares, having a value equal to the amount to be withheld (or such portion
thereof as the Participant may elect). Any election to have Shares withheld
under this Section may be subject, in the Committee's discretion, to such
restrictions as the Committee may determine, including but not limited to one or
more of the following restrictions in accordance with Section 16(b) of the
Exchange Act: (a) the election shall be irrevocable; (b) the election shall be
subject, in whole or in part, to the approval of the Committee and to such rules
as it may adopt; (c) the election must be made at least six months prior to the
transfer of Shares under the Plan and this Agreement; and (d) the election shall
be made during the time period specified in Rule 16b-3(e) promulgated under the
Exchange Act, or any successor rule or regulation thereto.
5.2. "Non-Alienation of Benefits": Prior to its settlement in the form of
Shares, no right or benefit under the Plan and this Agreement shall be subject
to anticipation, alienation, sale, assignment, pledge, encumbrance or charge,
and any attempt to anticipate, alienate, sell, assign, pledge, encumber or
charge the same whether voluntary, involuntary or by operation of law, shall be
void except by will or by the laws of descent and distribution or by such other
means as the Committee may approve from time to time. No right or benefit under
the Plan and this Agreement shall in any manner be liable for or subject to the
debts, contracts, liabilities, or torts of the person entitled to such benefit.
If Participant should become bankrupt or attempt to anticipate, alienate, sell,
assign, pledge, encumber or charge any right or benefit under the Plan and this
Agreement, then such right or benefit shall, in the sole discretion of the
Committee, cease and terminate, and in such event, the Corporation may hold or
apply the same or any part thereof for the benefit of Participant, the
Participant's spouse, children or other dependents, or any of them, in such
manner and in such proportion as the Committee may determine. Any restrictions
on transferability of the Shares either described above or otherwise provided
for in this Agreement may be referred to in legends contained on the
certificates evidencing such Shares.
5.3. "Legal Holiday": If and when the date on which a computation or
distribution is to be made or other action is to be taken under the Plan or this
Agreement falls on a Saturday, Sunday, or a legal holiday, such computation or
distribution shall be made or such other action taken on the next succeeding
business day.
5.4 "Change in Control": For the purposes of this Section, "Change in
Control" shall have the meaning assigned to it in Section 10 of the Plan.
Notwithstanding any provisions hereof to the contrary, upon the occurrence of a
Change in Control, all Options granted under the Plan and this Agreement that
are unexercised and unexpired shall become immediately and automatically vested
for the period of their remaining terms, without any further action by the
Committee.
5.5. "General Restrictions": The Plan and each Award under the Plan and
this Agreement and the issuance or purchase of Shares in connection therewith
shall be subject to the condition that, if at any time the Committee shall
determine that the Plan, this Agreement, an Award under the Plan and this
Agreement or the issuance or purchase of Shares in connection therewith requires
or it is desirable that it has (a) the listing, registration or qualification of
the Shares subject or related to the Plan upon any securities exchange or under
any state or Federal law or under the rules and regulations of the Securities
and Exchange Commission or any other governmental regulatory body, or (b) the
consent or approval of any government regulatory body, or (c) an agreement by
the recipient of an Award with respect to the disposition of Shares, then the
Plan and this Agreement will not be effective and the Award may not be
consummated in whole or in part unless such listing, registration,
qualification, consent, approval or agreement shall have been effected or
obtained free of any conditions not acceptable to the Committee.
5.6. "Rights of a Shareholder": The recipient of any Award under the Plan
and this Agreement, and any person claiming under or through such recipient or
under the Plan or this Agreement, shall not be, nor have any of the rights of, a
shareholder with respect thereto, nor shall they have any right or interest in
any cash or other property, unless and until certificates for Shares are issued
to such Participant after compliance with all the terms and conditions of the
Plan and this Agreement.
5.7. "Rights to Terminate Employment": Nothing in the Plan or this
Agreement shall confer upon Participant the right to continue in the employment
of the Corporation, or to continue in any position or at any level of
remuneration, or affect any right which the Corporation may have to terminate
the employment of such Participant for any reason whatsoever, with or without
good cause.
5.8. "Management, Accounting and Financial Decisions": Nothing in the Plan
or this Agreement shall affect the authority of the management of the
Corporation to make management, business, accounting and financial decisions
concerning the Corporation.
5.9. "Non-Uniform Determinations": The Committee's determinations under the
Plan (including without limitation determinations of the persons to receive
Awards, the form, amount and timing of such Awards, the terms and provisions of
such Awards and the agreements evidencing same, and the establishment of values
and performance targets) need not be uniform and may be made by the Committee
selectively among persons who receive, or are eligible to receive, Awards under
the Plan, whether or not such persons are similarly situated.
5.10. "Adjustments": In the event of any change in the outstanding Shares
by reason of a stock dividend or distribution, recapitalization, merger,
consolidation, split-up, combination, exchange of shares or the like, the
Committee shall adjust the maximum number of Shares which may be issued under
the Plan and shall provide for an equitable adjustment of any outstanding and
unexercised Award or any Shares issuable pursuant to an outstanding and
unexercised Award under the Plan and this Agreement, to the end that after such
event the Participant's proportionate interest shall be maintained as before the
occurrence of such event. The decision of the Committee with respect to the
nature and amount of the adjustment(s) shall be conclusive and binding upon
Participant and all persons claiming under or through Participant or under the
Plan or this Agreement.
5.11. "Delegation": The Committee may delegate to one or more officers or
managers of the Corporation, or a committee of such officers or managers, the
authority, subject to such terms and limitations as the Committee shall
determine, to: (a) grant Awards to participants under the Plan; (b) cancel,
modify, or waive rights with respect to participants under the Plan; or (c)
alter, discontinue, suspend, or terminate Awards held by participants under the
Plan; provided, however, that no such participant shall be an officer, director
or ten percent shareholder of the Corporation within the meaning of those terms
under Section 16 of the Exchange Act.
5.12. "Amendment": The Board may amend, suspend or terminate the Plan at
any time or from time to time, except that no amendment shall be effective
without shareholder approval if shareholder approval of such amendment,
suspension or termination would be required in order to ensure that the Plan, as
amended, would continue to meet the requirements of Rule 16b-3 promulgated under
the Exchange Act, or any successor rule or regulation thereto. Except as may be
provided in this Agreement, the termination or any modification or amendment of
the Plan shall not, without the consent of Participant, affect Participant's
rights under an Award previously granted.
5.13. "Effect on Other Plans": Nothing in the Plan or this Agreement shall
be construed to limit the right of the Corporation to establish any other forms
of incentives or compensation for employees of the Corporation or to grant or
assume options otherwise than under the Plan or this Agreement in connection
with any proper corporate purpose.
5.14. "Duration of the Agreement": This Agreement shall remain in effect
until all Awards under this Agreement either have been satisfied by the issuance
of Shares or have expired or been forfeited by their terms.
5.15. "Funding of the Plan": The Plan shall be unfunded. The Corporation
shall not be required to establish any special or separate fund or to make any
other segregation of assets to assure the payment of any Award under the Plan or
this Agreement, and payment of Awards shall be subordinate to the claims of the
Corporation's general creditors.
5.16. "Severability": If any provision of the Plan or this Agreement or any
Award is or becomes or is deemed to be invalid, illegal, or unenforceable in any
jurisdiction, or as to any person or Award, or would disqualify the Plan or any
Award under any law deemed applicable by the Committee, such provision shall be
construed or deemed amended to conform to applicable laws, or if it cannot be so
construed or deemed amended without, in the determination of the Committee,
materially altering the intent of the Plan or the Award, such provision shall be
stricken as to such jurisdiction, person, or Award, and the remainder of the
Plan and this Agreement and any such Award shall remain in full force and
effect.
5.17. "Construction": Wherever any words are used in the Plan or this
Agreement in the masculine gender they shall be construed as though they were
also used in the feminine gender in all cases where they would so apply, and
wherever any words are used herein in the singular form they shall be construed
as though they were also used in the plural form in all cases where they would
so apply.
5.18. "Headings": Headings are given to the Sections and subsections of the
Plan and this Agreement solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of the Plan or this Agreement or any provision thereof.
5.19. "Governing Law": The validity, construction and effect of the Plan
and this Agreement and any rules and regulations relating to the Plan and this
Agreement shall be determined in accordance with the laws of the Commonwealth of
Pennsylvania and applicable Federal law.
AMP Incorporated
Dated____________________________
By_______________________________
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Participant hereby acknowledges receipt of a copy of the Plan and this
Agreement, accepts his or her designation as a Participant under and subject to
all the terms and conditions set forth herein and in the Plan, and agrees to all
such terms and conditions.
Dated____________________________
_________________________________
Participant
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AMP Incorporated
General Offices
Harrisburg, Pennsylvania
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NONQUALIFIED
STOCK OPTION AGREEMENT
Issued to
_________________________________
Participant
Dated___________________________________________________________
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Schedule to
EX-10.C
Agreements identical to the "AMP Incorporated Nonqualified Stock Option
Agreement" were entered into by the following executive officers in July, 1993
for a specific member of Nonqualified Stock Options that varies as to each
executive officer, with each such option having an Award Date of July 27, 1993;
an Exercise Price of $60.50; and an Exercise Period from July 27, 1996 to July
27, 2003:
Xxxxx X. Xxxxxxxxx
Xxx X. Xxxxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxx Xxxxxx
Xxxxxx X. Xxxxxxxxxxxxx
Xxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxxx Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxx
