EXHIBIT 10.1.1
NON-QUALIFIED STOCK OPTION AGREEMENT
PURSUANT TO THE
ARROW INTERNATIONAL, INC.
2006 DIRECTORS STOCK INCENTIVE PLAN
Name of Director: _______________________________________
Date of Grant: ___________________________
Number of Shares Covered by Option: ___________________________
Exercise Price (per share): $__________________________
This NON-QUALIFIED STOCK OPTION AGREEMENT (this "Agreement") is made between
Arrow International, Inc., a Pennsylvania corporation (the "Company"), and the
above-named individual, a director of the Company or one of its subsidiaries
(the "Director"), to record the granting of a non-qualified stock option
pursuant to the Company's 2006 Directors Stock Incentive Plan (the "Plan").
Capitalized terms used in this Agreement without definition have the respective
meanings ascribed to them in the Plan.
1. GRANT OF OPTION. In accordance with the terms of the Plan, the Company
hereby grants to the Director, subject to the terms and conditions of the Plan
and this Agreement, the option to purchase from the Company the specified number
of shares of Common Stock at the specified exercise price, such option to be
exercised as hereinafter provided. Said exercise price is equal to the fair
market value of a share of the Common Stock on the date of grant of this option.
The parties intend this option to be treated as a non-qualified stock option
under the terms of the Code.
2. EXPIRATION DATE. This option shall expire ten years from the date of
grant (the "Expiration Date").
3. EXERCISE OF OPTION. No shares may be purchased under this option until
the first anniversary of the date of grant. On and after the first anniversary
of the date of grant, this option shall become exercisable with respect to 100%
of the shares of Common Stock subject hereto, provided the Director is serving
as a director of the Company or any subsidiary of the Company or, if such
directorship is terminated, subject to the terms and conditions stated under
Section 5 hereof.
This option may be exercised in whole or in part at any time with respect to
those shares that have become exercisable, provided that this option may not be
exercised after the Expiration Date.
In the event of a "change in control," as defined in Section 14 of the Plan,
unless a resolution of the Board adopted prior to and specifically relating to
the occurrence of such change in control provides otherwise, this option shall
become exercisable in full immediately. Any outstanding option not exercised
within 30 days of receipt of a notice of a change in control, however, shall
expire.
Notwithstanding the foregoing or any other provisions of the Plan or this
Agreement, this option is not exercisable by any person if the Director at the
time of exercise or at any time following the date of grant has, in the sole
discretion of the Board, worked for or on behalf of a competitor of the Company
or any affiliated company or otherwise engaged in competition against the
Company or any affiliated company.
Any exercise of this option shall be made in a writing duly executed and
delivered to the Company specifying the number of shares as to which the option
is being exercised in the form of the Form for Exercise of Option attached
hereto. Schedule I of this Agreement shall be made available to the Company at
the time of exercise for notation of any partial exercise.
- 12 -
4. PAYMENT OF EXERCISE PRICE. On the date of any exercise of this option,
the exercise price of the shares as to which this option is being exercised
shall be due and payable in full. Payment shall be made in cash or by check or
by delivery of shares of the Common Stock of the Company registered in the name
of the optionee, duly assigned to the Company with the assignment guaranteed by
a bank, trust company or member firm of the New York Stock Exchange, or by a
combination of the foregoing. Any such shares so delivered shall be deemed to
have a value per share equal to the fair market value of the shares on such
date. For this purpose, fair market value shall equal the closing price of the
Common Stock on the Nasdaq National Market System on the date the option is
exercised, or if there was no trading in such stock on the date of such
exercise, the closing price on the last preceding day on which there was such
trading.
5. EXERCISE UPON DEATH OR TERMINATION OF DIRECTORSHIP.
(1) If the Director ceases to be a director for any reason other
than death or disability (as determined by the Board in its sole discretion),
this option may be exercised at any time prior to the earlier of the Expiration
Date or the expiration of three months after the date of termination, but only
if, and to the extent that, the Director was entitled to exercise this option at
the time of termination.
(2) If the Director ceases to be a director by reason of death or
disability (as determined by the Board in its sole discretion), this option may
be exercised by the Director or the Director's legal representative, heir or
devisee, as appropriate, at any time prior to the earlier of the expiration of
the option or the expiration of one year following the date the Director
terminated service on the Board due to death or disability but only if, and to
the extent that, the Director was entitled to exercise this option at the time
of termination. If after termination, but before the earlier of the expiration
of the option or the expiration of the three-month period referred to in Section
5(1), the Director dies, this option shall continue to be exercisable only for
the remainder of either of such periods (whichever is shorter) and the one-year
period referred to in this Section 5(2) shall not be applicable.
(3) Notwithstanding the foregoing provisions, an option may not be
exercised after the Director's service on the Board terminates if the Board
determines, in its sole discretion, that the Director's termination resulted
from willful acts, or failures to act, by the Director detrimental to the
Company or any of its subsidiaries.
6. OPTION NONTRANSFERABLE. This option is not transferable otherwise than
by will or the laws of descent or distribution.
7. RIGHTS AS A SHAREHOLDER. The Director shall have no rights as a
shareholder with respect to any of the shares covered by this option until the
date of issuance to the Director of a stock certificate for such shares.
- 13 -
8. GENERAL RESTRICTIONS. The Company shall not be required to deliver any
certificate upon the exercise of this option until it has been furnished with
such opinion, representation or other document as it may reasonably deem
necessary, in its discretion, to ensure compliance with any law or regulation of
the Securities and Exchange Commission or any other governmental authority
having jurisdiction over the Company, the Director, or the shares to be optioned
under the Plan or any interests granted thereunder. This option is also subject
to the requirement that if at any time the Board shall determine, in its
discretion, that the listing, registration or qualification of the shares (or
the interests evidenced hereby) subject to this option upon the Nasdaq National
Market System or any securities exchange or automated quotation system, or under
any state or federal law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in connection
with, the granting of this option or the issue or purchase of shares hereunder
(or the interests evidenced hereby), this option shall not be exercised in whole
or in part and the interests evidenced hereby shall have no validity unless such
listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Board in the
exercise of its reasonable judgment.
9. ADJUSTMENT OF SHARES. In the event of any change in the Common Stock by
reason of any stock dividend, stock split, recapitalization, reorganization,
merger, consolidation, split-up, combination, exchange of shares, or rights
offering to purchase shares of Common Stock at a price substantially below fair
market value, or of any similar change affecting the Common Stock, the number
and kind of shares subject to this option and the purchase price per share shall
be appropriately adjusted consistent with such change in such manner as the
Board may deem equitable to prevent substantial dilution or enlargement of the
rights granted to, or available for, the Director hereunder. Any such adjustment
shall be final and binding on the Director.
10. NO RIGHTS TO BOARD SERVICE. Neither the Plan nor this option shall
confer upon the Director any right with respect to continuance, nomination or
re-election as a director of the Company or any subsidiary nor shall they
interfere in any way with the right of the Company or any subsidiary on whose
board of directors the Director sits to terminate the Director's service as a
director at any time, with or without cause.
11. COORDINATION WITH PLAN. The Director hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all of the terms and provisions
thereof, including any which may conflict with those contained in this
Agreement. Capitalized terms used in this Agreement shall have the meaning given
to such terms under the Plan.
12. NOTICES. All notices to the Company shall be in writing and sent to the
Company's Chairman and Chief Executive Officer at the Company's offices, 0000
Xxxxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000. Notices to the Director shall be
addressed to the Director at the Director's address as it appears in the
Company's records.
- 14 -
IN WITNESS WHEREOF, the Company and the Director have caused this Non-Qualified
Stock Option Agreement to be executed on the date set forth opposite their
respective signatures, it being further understood that the date of grant may
differ from the date of signature.
ARROW INTERNATIONAL, INC.
Dated: ___________________ By:
------------------------------------------
Name: Xxxx X. Xxxxxxxx, Xx.
Title: Chairman and Chief Executive Officer
DIRECTOR
Dated: ___________________
---------------------------------------------
Name:
- 15 -
FORM FOR EXERCISE OF OPTION
---------------------------
NON-QUALIFIED OPTIONS
(To be executed by the holder desiring to exercise the right
to purchase shares under the attached option)
The undersigned hereby irrevocably elects to exercise the right of purchase for
__________ shares of Common Stock, no par value per share, of Arrow
International, Inc. (the "Company"), pursuant to the Non-Qualified Stock Option
Agreement between the undersigned and the Company dated __________________, 20__
(the "Agreement"). The undersigned is delivering with this election, payment of
the purchase price in full and requests that certificates for the shares be
issued in the name of:
________________________________________
Name (Please print in block letters)
________________________________________
Street
________________________________________
City StateZip Code
________________________________________
(Please insert social security or other
identifying number)
The undersigned agrees that, if this is a partial exercise of the option, it
shall be noted on Schedule I of the Agreement, which is being delivered with
this election.
Dated:__________________________________________________
Signature
- 16 -
SCHEDULE I
----------
DATE OF NUMBER OF BALANCE OF AUTHORIZED NOTATION
EXERCISE SHARES PURCHASED OPTION SHARES SIGNATURE DATE
- 17 -
