Exhibit 10.25
Form of
NON-QUALIFIED STOCK OPTION
AGREEMENT
For employees grade 21 and
up
PURSUANT TO THE
BARNES GROUP INC.
STOCK AND INCENTIVE AWARD
PLAN
as amended effective
December 31, 2008
THIS DOCUMENT CONSTITUTES PART OF
A PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933.
OPTION AGREEMENT executed in
duplicate as of February 13, 2008 (the “ Grant
Date ”), between Barnes Group Inc., a Delaware
corporation, (the “ Company ”) and [ NAME
OF OPTIONEE ], an employee of the Company or of one of its
Subsidiaries (the “ Optionee ”), as amended
effective December 31, 2008.
In accordance with the provisions of
the Barnes Group Inc. Stock and Incentive Award Plan as amended
through December 31, 2008 or such later date(s), if any, to
which the December 31, 2008 documentary compliance date set
forth in paragraph .01 of section 3 of IRS Notice 2006-79 as
modified by section 3.01(B)(1) of IRS Notice 2007-86 is extended,
but excluding any amendment of such Plan that would constitute a
modification or extension of an option within the meaning of
Treasury Regulation section 1.409A-1(b)(5)(v) (the “
Plan ”), the Compensation and Management Development
Committee of the Company’s Board of Directors (the “
Committee ”) has authorized the execution of this
Agreement. Capitalized terms used in this Agreement and not
otherwise defined herein shall have the same meaning as provided
for in the Plan.
NOW, THEREFORE, in consideration of
the mutual covenants hereinafter set forth and for other good and
valuable consideration, the parties hereto agree as
follows:
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1.
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Grant of
Option . Subject to the
terms and conditions of the Plan and this Agreement, the Company
hereby grants to the Optionee the option to purchase [# OF
OPTIONS GRANTED ] shares of Common Stock (the “
Option ”).
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2.
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Purchase
Price . The purchase
price of the shares of Common Stock covered by this Option shall be
$ per share which
is one hundred percent (100%) of the Fair Market Value of the
Common Stock on the Grant Date (the “ Purchase Price
”).
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1
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(a)
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The Option
shall vest (i.e., become exercisable) at the rate of 33.3334% of
the shares covered by the Option on August 13, 2009 and
33.3333% of such shares on each of August 13, 2010 and
August 13, 2011. The number of shares with respect to which
the Option vests on any date shall be rounded to the nearest whole
Option; provided, that the aggregate number of shares with respect
to which the Option vests shall not exceed the number of shares set
forth in Section 1 hereof.
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(b)
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Subject to
Section 4, any portion of the Option which has not vested
pursuant to Section 3(a) before the date, if any, on which a
Change in Control occurs shall vest on that date. However, if a
Change in Control occurs less than six months after the Grant Date
and the Committee requests in writing before the date of such
Change in Control that the Optionee agree in writing to remain in
the employment of the Company through the date which is six months
after the Grant Date with substantially the same title, duties,
authority, reporting relationships, compensation and
indemnification as on the day immediately preceding the Change in
Control, then in that event any portion of the Option which has not
vested pursuant to Section 3(a) before the date on which such
Change in Control occurs shall vest pursuant to this
Section 3(b) only if the Optionee executes such written
agreement and delivers it to the Company not later than one week
after the date of such Change in Control, in which case such
portion of the Option shall vest when the Optionee delivers such
written agreement or, if later, on the date on which such Change in
Control occurs.
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4.
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Termination . The Option shall terminate 10 years after the
Grant Date of this Option (the “ Termination Date
”) unless it terminates earlier under the following
conditions:
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(a)
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If the
Optionee’s employment terminates for any reason other than
(i) death, (ii) Disability (as hereafter defined), or
(iii) retirement on or after the first anniversary of the
Grant Date at age 62 or later with a minimum of five (5) full
years of service with the Company and/or its Subsidiaries (“
Retirement ”), or (iv) “cause” (as
hereinafter defined), that portion of the Option which is
exercisable as of the date of such termination of employment shall
terminate on the date of such termination of employment (or one
(1) year after such termination of employment if the
Optionee’s employment was terminated by the Company and/or
its Subsidiaries without “cause”). That portion of the
Option which has not yet become exercisable as of the date of such
termination of employment shall be forfeited as of such
date.
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(b)
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If the Optionee’s
employment terminates as a result of death or Disability, that
portion of the Option which has not yet become exercisable
shall
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2
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become immediately exercisable as
of the date of such termination of employment and the Option shall
terminate one (1) year after the date of such termination of
employment. For purposes of this Agreement, “
Disability ” shall have the meaning set forth in the
Company’s long-term disability plan as in effect from time to
time (or, if that plan is not in effect at the time in question, as
it was last in effect).
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(c)
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If the Optionee
terminates employment by reason of Retirement, that portion of the
Option which has not yet become exercisable shall continue to
become exercisable as if the Optionee continued as an employee
until the Option terminates pursuant to this sentence or
Section 4(e) (whichever applies), provided that the Optionee
executes a covenant not to compete in a form acceptable to the
Committee at the time of Retirement, and complies with the terms of
said covenant not to compete, and the Option shall terminate one
(1) year after the date of such termination of employment (or
five (5) years after such termination of employment if the
Optionee executes a release of claims in a form acceptable to the
Committee at the time of Retirement).
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(d)
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Notwithstanding
the preceding paragraphs, if the Optionee’s employment is
terminated for “cause” (even if such termination would
otherwise qualify as Retirement), all of the outstanding Options
shall terminate on the date of such termination of employment. For
purposes of this Agreement, “ cause ” shall mean
(i) the willful and continued failure by the Optionee to
substantially perform the Optionee’s duties with the Company
(other than any such failure resulting from the Optionee’s
incapacity due to physical or mental illness) or (ii) the
willful engaging by the Optionee in conduct which is demonstrably
and materially injurious to the Company or its Subsidiaries,
monetarily or otherwise.
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(e)
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Notwithstanding
any other provision of this Agreement, no portion of the Option may
be exercised after the Termination Date.
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5.
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Method of
Exercising Option . This
Option shall be exercised in whole or in part by delivery of
written notice to the stock plan administrator of the Company (the
“ Administrator ”), in a form satisfactory to
the Administrator, specifying the number of shares which will be
purchased and the date on which the shares will be purchased (the
“ Purchase Date ”). The notice shall be
accompanied by full payment for the shares to be
purchased.
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If the Optionee elects to pay the
Purchase Price in whole or in part through proceeds generated by
the sale of stock acquired under this Option through a broker under
a cashless exercise arrangement referred to in
Section 7(b)(iii) of the Plan and approved by the Committee,
that part of the Purchase Price to be paid with proceeds of such
sale may be paid pursuant to the arrangement approved by the
Committee.
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Payment for shares being purchased
pursuant to the Option may be in whole or in part with shares of
Common Stock by either actual delivery of shares or by attestation,
provided that such shares have been owned by the Optionee for at
least six months or were acquired on the open market. The value of
the shares shall be their Fair Market Value on the Purchase Date.
Stock certificates representing any shares being actually delivered
as payment must be delivered to the Administrator on the Purchase
Date.
In connection with the exercise of
the Option, the Common Stock to be issued shall be credited to a
book entry account in the name of the Optionee. In lieu of
crediting such shares to a book entry account, at the election and
expense of the Optionee, stock certificates representing shares
purchased will be delivered to the Optionee as soon as
administratively practicable after the exercise of the
Option.
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6.
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Commitments
of the Optionee . If the
Optionee, at any time before the Option terminates:
(a) directly or indirectly, whether as an owner, partner,
shareholder, consultant, agent, employee, investor or in any other
capacity, accepts employment by, renders services for or otherwise
assists any other business which competes with the business
conducted by the Company or any of its Subsidiaries in which the
Optionee has worked during the Optionee’s last two years with
the Company or any of its Subsidiaries; (b) directly or
indirectly, hires or solicits or arranges for the hiring or
solicitation of any employee of the Company or any of its
Subsidiaries, or encourages any such employee to leave such
employment; (c) uses, discloses, misappropriates or transfers
confidential or proprietary information concerning the Company or
any of its Subsidiaries (except as required by the Optionee’s
work responsibilities with the Company or any of its Subsidiaries);
or (d) is convicted of a crime against the Company or any of
its Subsidiaries; or (e) engages in any activity in violation
of the policies of the Company or any of its Subsidiaries,
including without limitation the Company’s Code of Business
Ethics and Conduct, or, at any time, engages in conduct adverse to
the best interests of the Company or any of its Subsidiaries; then
should any of the foregoing events occur, the Option shall be
canceled, unless the Committee, in its sole discretion, elects not
to cancel such Option. The obligations in this Section 6 are
in addition to any other agreements related to non-competition,
non-solicitation and preservation of Company confidential and
proprietary information entered into between the Optionee and the
Company, and nothing herein is intended to waive, modify, alter or
amend the terms of any such other agreement.
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7.
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Non-Transferability . This Option shall not be transferable by the
Optionee otherwise than to a Beneficiary, and during the lifetime
of the Optionee, this Option may be exercised only by the
Optionee.
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8.
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Withholding of
Taxes . The Committee may
cause to be made, as a condition precedent to any payment or
transfer of stock hereunder, appropriate arrangements for the
withholding of any Federal, state or local taxes. The Company shall
accept
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4
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whole shares of Stock of
equivalent Fair Market Value in payment of the Company’s
minimum statutory withholding tax obligations if the Optionee
elects to make payment in such manner.
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