Exhibit
99.1
STOCK
OPTION
AWARD
AGREEMENT
(Non-Employee
Directors)
THIS STOCK OPTION AWARD
AGREEMENT , entered into
as of the Grant Date, is by and between the Participant and
Caraustar Industries, Inc. (the “ Company
”).
BACKGROUND
STATEMENT
The Company maintains the Caraustar
Industries, Inc. 2003 Long-Term Equity Incentive Plan (the “
Plan ”), which is incorporated into and forms a part
of this Agreement, and the Participant has been selected by the
Compensation and Employee Benefits Committee of the Company’s
Board of Directors, which administers the Plan (the “
Committee ”), to receive an stock option award under
the Plan.
NOW, THEREFORE, IT IS
AGREED , by and between
the Company and the Participant, as follows:
1. Terms of Award .
The following terms used in this Agreement shall have the meanings
set forth in this paragraph 1:
(a) The “ Participant
” is
.
(b) The “ Grant Date
” is December 9, 2005 .
(c) The number of “ Covered
Option Shares ” subject to the Option awarded under this
Agreement shall be 3,000 shares of the Company’s common
stock.
(d) The “ Exercise
Price ” is $9.81 per Covered Option
Share.
Other terms used in this Agreement
are defined in paragraph 8 or elsewhere in this
Agreement.
2. Award and Exercise
Price . This Agreement specifies the terms of the option
(the “ Option ”) granted to the Participant to
purchase the number of Covered Option Shares of the Company’s
common stock at the Exercise Price per share as set forth in
paragraph 1. The Option is not intended to constitute an
“incentive stock option” as that term is used in
Section 422 of the Internal Revenue Code, as
amended.
3. Period of Exercise
. Subject to the limitations of this Agreement, the Option shall be
exercisable for a period of ten years beginning on the Grant Date
and ending on December 9, 2015 (the “ Expiration
Date ”).
4. Exercise of Option
. Subject to the terms of this Agreement and the Plan, the Option
may be exercised in whole or in part by filing a written notice
with the Secretary of the Company at its corporate headquarters
prior to the Company’s close of business on the last business
day that occurs prior to the Expiration Date. Such notice shall
specify the number of Covered Option Shares that the Participant
elects to purchase, and shall be accompanied by payment of the
Exercise Price for the Covered Option Shares indicated by the
Participant’s election. Payment shall be by cash or by check
payable as directed by the Company, provided that except as
otherwise provided by the Committee before the Option is exercised:
(i) all or a portion of the Exercise Price may be paid by the
Participant by delivery of shares of common stock owned by the
Participant and acceptable to the Committee having an aggregate
Fair Market Value (valued as of the date of exercise) that is equal
to the amount of cash that would otherwise be required; and
(ii) the Participant may pay the Exercise Price by authorizing
a third party to sell shares of the Company’s common stock
(or a sufficient portion of the shares) acquired upon exercise of
the Option and remit to the Company a sufficient portion of the
sale proceeds to pay the entire Exercise Price and any tax
withholding resulting from such exercise. The Option shall not be
exercisable if and to the extent the Company determines that such
exercise would violate applicable state or federal securities laws
or the rules and regulations of any securities exchange on which
the Company’s common stock is traded. If the Company makes
such a determination, it shall use all reasonable efforts to obtain
compliance with such laws, rules and regulations. In making any
determination hereunder, the Company may rely on the opinion of
counsel for the Company.
5. Transferability .
Except as otherwise provided in this paragraph 5, the Option is not
transferable other than as designated by the Participant by will,
the laws of descent and distribution or a qualified domestic
relations order. However, the Participant, with the approval of the
Committee, may transfer the Option for no consideration
