EXHIBIT 10.5
FORM OF
NON-QUALIFIED STOCK OPTION AGREEMENT
FOR INDEPENDENT DIRECTORS UNDER THE
CIRCOR INTERNATIONAL, INC.
1999 STOCK OPTION AND INCENTIVE PLAN
Name of Optionee:_____________________________
Number of Option Shares: 2,000
Option Exercise Price per Share:________________________
[FMV]
Grant Date:____________________
Expiration Date:_______________________________
[up to 10 years]
Pursuant to the CIRCOR International, Inc. 1999 Stock Option and Incentive
Plan (the "Plan"), CIRCOR International, Inc. (the "Company") hereby grants to
the Optionee named above, who is an Independent Director of the Company, an
option (the "Stock Option") to purchase on or prior to the Expiration Date
specified above all or part of the number of shares (the "Option Shares") of
Common Stock, par value $.01 per share (the "Stock") of the Company specified
above at the Option Exercise Price per Share specified above, subject to the
terms and conditions set forth herein and in the Plan.
1. Vesting Schedule. No portion of this Stock Option may be exercised
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until such portion shall have vested. Except as set forth below, and subject to
the discretion of the Committee (as defined in Section 2 of the Plan) to
accelerate the vesting schedule hereunder, this Stock Option shall be vested and
exercisable with respect to the following number of Option Shares on the dates
indicated:
Number of
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Option Shares Exercisable Vesting Date
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667 (33 1/3%) ----------
667 (33 1/3%) ----------
666 (33 1/3%) ----------
In the event of a Covered Transaction as defined in Section 3(c) of the
Plan, this Stock Option shall become immediately vested and exercisable in full,
whether or not this Stock Option or any portion thereof is vested and
exercisable at such time. Once vested, this Stock Option shall continue to be
exercisable at any time or times prior to the close of business on the
Expiration Date, subject to the provisions hereof and of the Plan.
2. Manner of Exercise.
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(a) The Optionee may exercise this Stock Option only in the following
manner: from time to time on or prior to the Expiration Date of this Stock
Option, the Optionee may give written notice to the Committee of his or her
election to purchase some or all of the vested Option Shares purchasable at the
time of such notice. This notice shall specify the number of Option Shares to
be purchased.
Payment of the purchase price for the Option Shares may be made by one or
more of the following methods: (i) in cash, by certified or bank check or other
instrument acceptable to the Committee; (ii) by the Optionee delivering (or
attesting to the ownership of) shares of Stock that have been purchased on the
open market or that have been held by the Optionee for at least six months and
that are not then subject to restrictions under any Company plan; (iii) by the
Optionee delivering to the Company a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the Company
cash or a check payable and acceptable to the Company to pay the option purchase
price, provided that in the event the Optionee chooses to pay the option
purchase price as so provided, the Optionee and the broker shall comply with
such procedures and enter into such agreements of indemnity and other agreements
as the Committee shall prescribe as a condition of such payment procedure; or
(iv) a combination of (i), (ii) and (iii) above. Payment instruments will be
received subject to collection.
The delivery of certificates representing the Option Shares will be
contingent upon the Company's receipt from the Optionee of full payment for the
Option Shares, as set forth above and any agreement, statement or other evidence
that the Company may require to satisfy itself that the issuance of Stock to be
purchased pursuant to the exercise of Stock Options under the Plan and any
subsequent resale of the shares of Stock will be in compliance with applicable
laws and regulations.
(b) Certificates for the shares of Stock purchased upon exercise of
this Stock Option shall be issued and delivered to the Optionee upon compliance
to the satisfaction of the Committee with all requirements under applicable laws
or regulations in connection with such issuance and with the requirements hereof
and of the Plan. The determination of the Committee as to such compliance shall
be final and binding on the Optionee. The Optionee shall not be deemed to be
the holder of, or to have any of the rights of a holder with respect to, any
shares of Stock subject to this Stock Option unless and until this Stock Option
shall have been exercised pursuant to the terms hereof, the Company shall have
issued and delivered the shares to the Optionee, and the Optionee's name shall
have been entered as the stockholder of record on the books of the Company.
Thereupon, the Optionee shall have full voting, dividend and other ownership
rights with respect to such shares of Stock.
(c) The minimum number of shares with respect to which this Stock
Option may be exercised at any one time shall be 100 shares, unless the number
of shares with respect
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to which this Stock Option is being exercised is the total number of shares
subject to exercise under this Stock Option at the time.
(d) Notwithstanding any other provision hereof or of the Plan, no
portion of this Stock Option shall be exercisable after the Expiration Date
hereof.
3. Termination as Director. If the Optionee ceases to be a Director of
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the Company, the period within which to exercise this Stock Option may be
subject to earlier termination as set forth below.
(a) Termination Due to Death. If the Optionee ceases to be a Director
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by reason of the Optionee's death, this Stock Option shall become fully
exercisable and may thereafter be exercised by the Optionee's legal
representative or legatee for a period of one year from the date of death or
until the Expiration Date, if earlier.
(b) Termination Due to Disability. If the Optionee ceases to be a
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director by reason of the Optionee's Disability (within the meaning of Section
22(e)(3) of the Code), this Stock Option shall become fully exercisable and may
thereafter be exercised by the Optionee for a period of one year from the date
of termination or until the Expiration Date, if earlier.
(c) Other Termination. If the Optionee ceases to be a director for
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any reason other than death or Disability, and unless otherwise determined by
the Committee, any portion of this Stock Option may be exercised by the
Optionee, to the extent exercisable on the date of termination, for a period of
three months from the date of termination or until the Expiration Date, if
earlier. Any portion of this Stock Option that is not exercisable at such time
shall terminate immediately and be of no further force or effect.
(d) Miscellaneous. The Administrator's determination of the reason
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for termination of the Optionee's directorship shall be conclusive and binding
on the Optionee and his or her representatives or legatees. Any portion of this
Stock Option that is unvested after the application of this Section 3 shall be
canceled immediately upon any termination of directorship and shall not be
exercisable by the Optionee.
4. Incorporation of Plan. Notwithstanding anything herein to the
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contrary, this Stock Option shall be subject to and governed by all the terms
and conditions of the Plan. Capitalized terms in this Agreement shall have the
meaning specified in the Plan, unless a different meaning is specified herein.
5. Transferability. This Agreement is personal to the Optionee, is non-
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assignable and is not transferable in any manner, by operation of law or
otherwise, other than by will or the laws of descent and distribution. This
Stock Option is exercisable, during the Optionee's lifetime, only by the
Optionee, and thereafter, only by the Optionee's legal representative or
legatee. Notwithstanding the foregoing, the Optionee may transfer this Stock
Option to members of his immediate family, to trusts for the benefit of such
family members, or to
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partnerships in which such family members are the only partners, provided that
the transferee agrees in writing with the Company to be bound by all of the
terms and conditions of the Plan and this Stock Option.
6. Miscellaneous.
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(a) Notice hereunder shall be given to the Company at its principal
place of business, and shall be given to the Optionee at the address set forth
below, or in either case at such other address as one party may subsequently
furnish to the other party in writing.
(b) This Stock Option does not confer upon the Optionee any rights
with respect to continuance as a Director of the Company.
(c) Pursuant to Section 14 of the Plan, the Committee may at any time
amend or cancel any outstanding portion of this Stock Option, but no such action
may be taken which adversely affects the Optionee's rights under this Agreement
without the Optionee's consent.
CIRCOR INTERNATIONAL, INC.
By:
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Title:
The foregoing Agreement is hereby accepted and the terms and conditions thereof
hereby agreed to by the undersigned.
Date:
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Optionee's Signature
Optionee's name and address:
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