Exhibit 10mm
2004
Form L
Transferrable Option
Cash or Stock
Annual Grant
BRUSH ENGINEERED MATERIALS INC.
Nonqualified Stock Option Agreement
WHEREAS_______________ (hereinafter called the "Optionee") is a
non-employee director of Brush Engineered Materials Inc. (hereinafter called the
"Company") who has never been an employee of the Company or any subsidiary
("Eligible Director").
WHEREAS, the Company's 1997 Stock Incentive Plan for Non-Employee
Directors (as Amended and Restated as of May 1, 2001) (the "Plan") provides for
the automatic grant to each Eligible Director, on the business day next
following the day of each annual meeting of the Company's shareholders, of an
option to purchase a number of shares of the Company's Common Stock, without par
value ("Common Stock"), determined by the committee (the "Committee")
established by the Plan, not to exceed 2,000 shares; and
WHEREAS, this Nonqualified Stock Option Agreement has been duly
approved by the Committee;
NOW THEREFORE, this Agreement shall evidence and confirm the
Company's grant to the Optionee of an option to purchase ______ shares of Common
Stock, at the price of $______ per share ("option price"), and agrees to cause
certificates for any shares purchased hereunder to be delivered to the Optionee
upon receipt of the purchase price, all subject, however, to the terms and
conditions of the Plan and the terms and conditions hereinafter set forth. The
option price shall be payable (i) in cash, (ii) by the transfer to the Company
by the Optionee of nonforfeitable, unrestricted shares of Common Stock of the
Company held by the Optionee for more than one year and having a fair market
value at the time of exercise of this option equal to the total option price of
the shares of Common Stock which are the subject of such exercise, or (iii) by a
combination of such methods of payment.
1. This option (unless terminated as hereinafter provided) shall be
exercisable in full after the Optionee shall have been a director of the Company
for a period of six (6) months from the date hereof. Notwithstanding the
foregoing, this option shall become immediately exercisable in full by the
optionee's legal representative if the Optionee should die while serving as a
director of the Company. If the Optionee subsequently becomes an employee of the
Company while remaining a member of the Board of Directors, this option shall
not be affected thereby. To the extend exercisable, this option may be exercised
in whole or in part from time to time.
2. This option shall terminate on the earliest of the following
dates:
(A) Three months after the date of termination of service on the
Board of Directors by the Optionee, other than after completion of 5 years of
service as a Director or by reason of total and permanent disability or death.
(B) Five years after (i) termination of the Optionee's service
after completing 5 years of service as a Director or (ii) the total and
permanent disability of the Optionee.
(C) Ten years from the date on which this option was granted.
Neither the Plan, nor the granting of this option nor any other action taken
pursuant to the Plan, shall constitute or be evidence of any agreement or
understanding, express or implied, that the optionee has a right to continue as
a director for any period of time, or at any particular rate of compensation.
3. (A) Except as provided in Section 3 (B) below, this option
shall not be transferable by the Optionee except by will or the laws of descent
and distribution, and this option shall be exercisable during the lifetime of
the Optionee only by the Optionee or, in the event of the Optionee's legal
incapacity to do so, by the Optionee's guardian or legal representative acting
on behalf of the Optionee in a fiduciary capacity under state law and court
supervision.
(B) Notwithstanding Section 3 (A) above, this option may be
transferable by the Optionee, without payment of consideration therefor, to any
one or more members of the immediate family of Optionee (as defined in Rule
16a-1(e) under the Securities Exchange Act of 1934), or to one or more trusts
established solely for the benefit of such members of the immediate family or to
partnerships in which the only partners are such members of the immediate family
of the Optionee; provided, however, that such transfer will not be effective
until notice of such transfer is delivered to the Company; and provided,
further, however, that any such transferee is subject to the same terms and
conditions hereunder as the Optionee.
4. This option shall not be exercisable if such exercise would
involve a violation of any applicable state securities law, and the Company
hereby agrees to make reasonable efforts to comply with any applicable state
securities law. If the Ohio Securities Act shall be applicable to this option,
it shall not be exercisable unless under said Act at the time of exercise the
shares of Common Stock or other securities purchasable hereunder are exempt, are
the subject matter of an exempt transaction, are registered by description or by
qualification, or at such time are the subject matter of a transaction which has
been registered by description.
5. This option shall not be exercisable if at the time of
exercise such exercise would require registration under the Securities Act of
1933, as amended, or any similar federal securities law then in effect, of the
shares of Common Stock or other securities to be purchased hereunder and such
registration shall not then be effective. The Company hereby agrees to make
reasonable efforts to effect any such required registration.
6. The Committee shall make such adjustments in the option price
and in the number or kind of shares of Common Stock or other securities covered
by this option as such Committee in its sole discretion, exercised in good
faith, may determine is equitably required to prevent dilution or enlargement of
the rights of the Optionee that otherwise would
result from (a) any stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of the Company, or (b)
any merger, consolidation, reorganization, partial or complete liquidation, or
(c) any other corporate transaction or event having an effect similar to any of
the foregoing.
7. This option is intended to be a nonqualified stock option, and
will not be treated as an "incentive stock option" as that letter term is
defined in Section 422 of the Internal Revenue Code.
Executed at Cleveland, Ohio this _____ day of ____, 2004.
BRUSH ENGINEERED MATERIALS INC.
By _____________________________________
Xxxxxxx X. Xxxxxxxx, Vice President
Treasurer and Secretary
The undersigned Optionee hereby acknowledges receipt of an executed original of
this Stock Option Agreement.
Optionee ________________________________
Form-L-2002
