THIS
AGREEMENT, made as of this
day of
, by and between Encore Wire Corporation, a Delaware corporation
(the “Company”), and
(“Employee”);
WHEREAS,
the Board of Directors of the Company has determined that it is
desirable to grant an option under the Encore Wire Corporation 1999
Stock Option Plan (the “Plan”) to Employee, who is
currently employed by the Company or an affiliate of the
Company;
NOW,
THEREFORE, the Company and Employee hereby agree as
follows:
1.
Definitions . As used in this Agreement, the following terms
shall have the following meanings, respectively:
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(a)
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“Affiliate” shall have
the meaning set forth in Section 2(a) of the Plan and shall include
any party now or hereafter coming within that
definition.
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(b)
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“Common Stock” shall
have the meaning set forth in Section 2(e) of the Plan.
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(c)
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“Fair Market Value”
shall have the meaning set forth in Section 2(h) of the
Plan.
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2.
Option . The Company hereby grants to Employee the option to
purchase, as hereinafter set forth,
shares of the Common Stock of the Company at a price of $
per share, for a period commencing on the date provided in
Section 4 hereof and terminating on the first to occur of
(i) the expiration of ten years from the date of this
Agreement, or (ii) when the employment of Employee by the
Company or any of its Affiliates terminates for any reason;
provided, however, that if said employment terminates less than ten
years from the date hereof other than by reason of death or
disability, then Employee may exercise this option, to the extent
he was entitled to do so at the date of termination of employment,
at any time within three months after such termination, but not
after the expiration of the ten-year period; provided further that
if said employment terminates less than ten years from the date
hereof by reason of Employee’s becoming permanently and
totally disabled (within the meaning of Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended), then Employee (or
Employee’s legal representative if Employee is legally
incompetent) may exercise this option, to the extent he was
entitled to do so at the date of such termination, at any time
within one year after such termination but not after the expiration
of the ten-year period; and provided further that if said
employment terminates less than ten years from the date hereof by
reason of Employee’s death, then the executor or
administrator of Employee’s estate or anyone who shall have
acquired this option by will or pursuant to the laws of descent and
distribution may exercise this option, to the extent Employee was
entitled to do so on the date of his death, at any time within one
year after such death but not after the expiration of the ten-year
period. Anything to the contrary herein notwithstanding, the option
granted hereunder shall terminate immediately upon the
Employee’s termination of employment on account of fraud,
dishonesty or the performance of other acts detrimental to the
Company. A transfer of employment without interruption of service
between or among the Company and any of its Affiliates shall not be
considered a termination of employment for purposes of this
Agreement. This option is intended to qualify as an incentive stock
option as defined in Internal Revenue Code
Section 422.
3.
Exercise During Employment . Except as provided in
Section 2 hereof, this option may not be exercised unless
Employee is at the time of exercise an employee of the Company or
an Affiliate.
4.
Vesting . Subject to the provisions of Sections 2 and 3
hereof, this option may only be exercised in accordance with the
following:
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(a)
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a number of whole shares of Common
Stock which does not exceed twenty percent of the shares of Common
Stock in respect of which this option is granted may be purchased
in whole at any time, or in part from time to time, on or after the
first anniversary of the date of this Agreement;
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(b)
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an additional number of whole
shares of Common Stock which does not exceed twenty percent of the
shares of Common Stock in respect of which this option is granted
may be purchased in whole at any time, or in part from time to
time, on or after the second anniversary of the date of this
Agreement;
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(c)
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an additional number of whole
shares of Common Stock which does not exceed twenty percent of the
shares of Common Stock in respect of which this option is granted
may be purchased in whole at any time, or in part from time to
time, on or after the third anniversary of the date of this
Agreement;
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