Exhibit 10.40

KOPPERS HOLDINGS INC.

NOTICE OF GRANT OF STOCK OPTION

 

Notice is hereby given of the following option grant (the “Option”) to purchase
shares of the Common Stock of Koppers Holdings Inc. (the “Company”):

Optionee:  

Grant Date:  [_______]

Vesting Commencement Date:  [_______]

Exercise Price:  

Number of Option Shares:  

Expiration Date:  [_______]

Type of Option:

 

Incentive Stock Option

 

X

Non-Qualified Stock Option

Vesting Schedule:  The Option shall become exercisable for 25% of the Option
Shares upon Optionee’s completion of a consecutive twelve (12)-month period of
Service measured from the Vesting Commencement Date.  The Option shall become
exercisable for 25% of the Option Shares upon Optionee’s completion of a
consecutive twenty-four (24)-month period of Service measured from the Vesting
Commencement Date.  The Option shall become exercisable for 25% of the Option
Shares upon Optionee’s completion of a consecutive thirty-six (36)-month period
of Service measured from the Vesting Commencement Date.  The Option shall become
exercisable for 25% of the Option Shares upon Optionee’s completion of a
consecutive forty-eight (48)-month period of Service measured from the Vesting
Commencement Date.  However, one or more Option Shares may be subject to
accelerated vesting in accordance with Section 6 of the Stock Option Agreement.
In no event shall the Option become exercisable for any additional Option Shares
after Optionee’s cessation of Service. Only a whole number of Option Shares will
become vested and exercisable as of any given date.  If the number of Option
Shares that become vested and exercisable determined as of a date is a
fractional number, the number vesting will be rounded down to the nearest whole
number with any fractional portion carried forward.

Optionee understands and agrees that the Option is granted subject to and in
accordance with the terms of the Koppers Holdings Inc. 2018 Long Term Incentive
Plan (the “Plan”).  Optionee further agrees to be bound by the terms of the Plan
and the terms of the Option as set forth in the Stock Option Agreement attached
hereto as Exhibit A. Optionee hereby acknowledges the receipt of a copy of the
official prospectus for the Plan in the form

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attached hereto as Exhibit B. A copy of the Plan is available upon request made
to the Corporate Secretary at the Company’s principal offices.

Employment at Will.  Nothing in this Notice or in the attached Stock Option
Agreement or in the Plan shall confer upon Optionee any right to continue in
Service for any period of specific duration or interfere with or otherwise
restrict in any way the rights of the Company (or any Parent or Subsidiary
employing or retaining Optionee) or of Optionee, which rights are hereby
expressly reserved by each, to terminate Optionee’s Service at any time for any
reason, with or without cause, unless such rights have otherwise been limited
pursuant to a separate agreement between the Company (or any Parent or
Subsidiary) and the Participant.

Definitions.  All capitalized terms in this Notice shall have the meaning
assigned to them in this Notice or in the attached Stock Option Agreement.

DATED: _                          _

KOPPERS HOLDINGS INC.

By:

 

 

 

Title:

President and CEO

 

Participant:

 

Signature:

  

 

 

Address:

 

 

 

 

 

ATTACHMENTS
Exhibit A - Stock Option Agreement
Exhibit B - Plan Prospectus

 

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Exhibit 10.40

 

KOPPERS HOLDINGS INC.

STOCK OPTION AGREEMENT

RECITALS

A.

The Board has adopted the Plan for the purpose of retaining the services of
selected Employees, non-employee members of the Board (or the board of directors
of any Parent or Subsidiary) and consultants and other independent advisors who
provide services to the Corporation (or any Parent or Subsidiary).

B.

Optionee is to render valuable services to the Corporation (or a Parent or
Subsidiary), and this Agreement is executed pursuant to, and is intended to
carry out the purposes of, the Plan in connection with the Corporation’s grant
of an option to Optionee.

C.

The option granted by the Corporation pursuant to this Agreement is in
consideration for the Optionee’s acceptance of, and agreement to, the terms,
conditions, and restrictions of the restrictive covenants set forth in Paragraph
11 of this Agreement.

D.

Unless otherwise defined in this Agreement, all capitalized terms in this
Agreement shall have the meaning assigned to them in the attached Appendix.

NOW, THEREFORE, it is hereby agreed as follows:

1.Grant of Option.  The Corporation hereby grants to Optionee, as of the Grant
Date, an option to purchase up to the number of Option Shares specified in the
Grant Notice.  The Option Shares shall be purchasable from time to time during
the option term specified in Paragraph 2 at the Exercise Price.

2.Option Term.  This option shall have a maximum term of ten (10) years measured
from the Grant Date and shall accordingly expire at the close of business on the
Expiration Date, unless sooner terminated in accordance with Paragraph 5, 6 or
11.

3.Limited Transferability.  

(a)This option shall be neither transferable nor assignable by Optionee other
than by will or the laws of inheritance following Optionee’s death and may be
exercised, during Optionee’s lifetime, only by Optionee.  However, Optionee may
designate one or more persons as the beneficiary or beneficiaries of this
option, and this option shall, in accordance with such designation,
automatically be transferred to such beneficiary or beneficiaries upon the
Optionee’s death while holding this option.  Such beneficiary or beneficiaries
shall take the transferred option subject to all the terms and conditions of
this Agreement, including (without limitation) the limited time period during
which this option may, pursuant to Paragraph 5, be exercised following
Optionee’s death.

(b)If this option is designated a Non-Statutory Option in the Grant Notice, then
this option may be assigned in whole or in part during Optionee’s lifetime to
one or more of

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the Optionee’s Family Members or to a trust established for the exclusive
benefit of Optionee and/or one or more such Family Members, to the extent such
assignment is in connection with the Optionee’s estate plan or pursuant to a
domestic relations order.  The assigned portion shall be exercisable only by the
person or persons who acquire a proprietary interest in the option pursuant to
such assignment.  The terms applicable to the assigned portion shall be the same
as those in effect for this option immediately prior to such assignment.

4.Dates of Vesting.  This option shall become exercisable for the Option Shares
in one or more installments in accordance with the Vesting Schedule set forth in
the Grant Notice.  As the option becomes exercisable for such installments,
those installments shall accumulate, and the option shall remain exercisable for
the accumulated installments until the Expiration Date or sooner termination of
the option term under Paragraph 5, 6 or 11.

5.Cessation of Service.  The option term specified in Paragraph 2 shall
terminate (and this option shall cease to be outstanding) prior to the
Expiration Date should any of the following provisions become applicable:

(a)Except as otherwise provided in subparagraphs (b), (c), (d), (e) and (h) of
this Paragraph 5, should Optionee cease to remain in Service for any reason
while this option is outstanding, then Optionee (or any person or persons to
whom this option is transferred pursuant to a permitted transfer under Paragraph
3) shall have a ninety (90)-day period measured from the date of such cessation
of Service during which to exercise this option, but in no event shall this
option be exercisable at any time after the Expiration Date.

(b)Should Optionee cease to remain in Service due to Optionee’s voluntary
resignation while this option is outstanding, then Optionee (or any person or
persons to whom this option is transferred pursuant to a permitted transfer
under Paragraph 3) shall have a thirty (30)-day period measured from the date of
such cessation of Service during which to exercise this option, but in no event
shall this option be exercisable at any time after the Expiration Date.

(c)Should Optionee die while this option is outstanding, then this option may be
exercised by (i) the personal representative of Optionee’s estate or (ii) the
person or persons to whom the option is transferred pursuant to Optionee’s will
or the laws of inheritance following Optionee’s death or to whom the option is
transferred during Optionee’s lifetime pursuant to a permitted transfer under
Paragraph 3, as the case may be. However, if Optionee dies while holding this
option and has an effective beneficiary designation in effect for this option at
the time of his or her death, then the designated beneficiary or beneficiaries
shall have the exclusive right to exercise this option following Optionee’s
death.  Any such right to exercise this option shall lapse, and this option
shall cease to be outstanding, upon the earlier of (i) the expiration of the
twelve (12)-month period measured from the date of Optionee’s death or (ii) the
Expiration Date.

(d)Should Optionee cease Service by reason of Permanent Disability while this
option is outstanding, then Optionee (or any person or persons to whom this
option is transferred pursuant to a permitted transfer under Paragraph 3) shall
have a twelve (12)-month period measured from the date of such cessation of
Service during which to exercise this option.  In no event shall this option be
exercisable at any time after the Expiration Date.

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(e)Should Optionee cease Service by reason of Retirement while this option is
outstanding, then Optionee (or any person or persons to whom this option is
transferred pursuant to a permitted transfer under Paragraph 3) shall have a
three (3)-year period measured from the date of Optionee’s Retirement during
which to exercise this option.  In no event shall this option be exercisable at
any time after the Expiration Date.

(f)The applicable period of post-Service exercisability in effect pursuant to
the foregoing provisions of this Paragraph 5 shall automatically be extended by
an additional period of time equal in duration to any interval within such
post-Service exercise period during which the exercise of this option or the
immediate sale of the Option Shares acquired under this option cannot be
effected in compliance with applicable federal and state securities laws, but in
no event shall such an extension result in the extension of this option beyond
the Expiration Date.

(g) During the limited period of post-Service exercisability, this option may
not be exercised in the aggregate for more than the number of Option Shares for
which this option is, at the time of Optionee’s cessation of Service, vested and
exercisable pursuant to the Exercise Schedule specified in the Grant Notice or
the special vesting acceleration provisions of Paragraph 6.  This option shall
not vest or become exercisable for any additional Option Shares, whether
pursuant to the normal Exercise Schedule specified in the Grant Notice or the
special vesting acceleration provisions of Paragraph 6, following the Optionee’s
cessation of Service, except to the extent (if any) specifically authorized by
the Plan Administrator pursuant to an express written agreement with the
Optionee.  Upon the expiration of such limited exercise period or (if earlier)
upon the Expiration Date, this option shall terminate and cease to be
outstanding for any exercisable Option Shares for which the option has not
otherwise been exercised.

(h)Should Optionee’s Service be terminated for Misconduct or should Optionee
otherwise engage in any Misconduct while this option is outstanding, then this
option shall terminate immediately and cease to remain outstanding.

6.Special Acceleration of Option.

(a)Should the Optionee’s Service terminate by reason of his or her Retirement,
death or Permanent Disability prior to the final vesting date for the Option,
then the Option shall immediately vest in the additional number of Option Shares
(if any) in which the Optionee would have been vested at the time of such
termination had 25% of the Option Shares that were scheduled to be vested on the
next anniversary of the Vesting Commencement Date instead vested in a series of
twelve (12) successive equal monthly installments over the duration of the
twelve (12) month period preceding such anniversary.

(b)This option, to the extent outstanding at the time of a Change in Control but
not otherwise fully exercisable, shall automatically accelerate so that this
option shall, immediately prior to the effective date of such Change in Control,
become exercisable for all of the Option Shares at the time subject to this
option and may be exercised for any or all of those Option Shares as fully
vested shares of Common Stock.  However, this option shall not become
exercisable on such an accelerated basis, if and to the extent: (i) this option
is to be assumed by the successor corporation (or parent thereof) or is
otherwise to be continued in full force and effect pursuant to the terms of the
Change in Control transaction or (ii) this option is to be replaced with a cash
retention program of the successor corporation which preserves the spread
existing at the time of the Change in Control on any Option Shares for which
this option is not otherwise at that time exercisable (the excess of the Fair
Market Value of those Option Shares over the aggregate

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Exercise Price payable for such shares) and provides for subsequent payout of
that spread in accordance with the same Vesting Schedule for those Option Shares
as set forth in the Grant Notice.

(c)Immediately following the Change in Control, this option shall terminate and
cease to be outstanding, except to the extent assumed by the Successor
Corporation (or parent thereof) or otherwise continued in effect pursuant to the
terms of the Change in Control transaction.

(d)If this option is assumed in connection with a Change in Control or otherwise
continued in effect, then this option shall be appropriately adjusted,
immediately after such Change in Control, to apply to the number and class of
securities into which the shares of Common Stock subject to this option would
have been converted in consummation of such Change in Control had those shares
actually been outstanding at the time. Appropriate adjustments shall also be
made to the Exercise Price, provided the aggregate Exercise Price shall remain
the same.  To the extent the actual holders of the Corporation’s outstanding
Common Stock receive cash consideration for their Common Stock in consummation
of the Change in Control, the successor corporation may, in connection with the
assumption or continuation of this option, substitute one or more shares of its
own common stock with a fair market value equivalent to the cash consideration
paid per share of Common Stock in such Change in Control, provided such common
stock is readily tradable on an established U.S. securities exchange or market.

(e)In the event the Optionee’s Service is involuntarily terminated for reasons
other than Misconduct within twenty-four (24) months following a Change in
Control transaction which does not result in the accelerated vesting of this
option pursuant to the provisions of subparagraph (b) of this Paragraph 6, then
the option (as assumed or continued in effect) shall automatically vest in full
on an accelerated basis so that such option shall immediately become exercisable
for all the Option Shares as fully-vested shares and may be exercised for any or
all of those Option Shares as vested shares.  

(f)This Agreement shall not in any way affect the right of the Corporation to
adjust, reclassify, reorganize or otherwise change its capital or business
structure or to merge, consolidate, dissolve, liquidate or sell or transfer all
or any part of its business or assets.

7.Adjustment in Option Shares.  In the event of any of the following
transactions affecting the outstanding Common Stock as a class without the
Corporation’s receipt of consideration: any stock split, stock dividend,
spin-off transaction, extraordinary distribution (whether in cash, securities or
other property), recapitalization, combination of shares, exchange of shares or
other similar transaction affecting the outstanding Common Stock without the
Corporation’s receipt of consideration or in the event of a substantial
reduction to the value of the outstanding shares of Common Stock by reason of a
spin-off transaction or extraordinary distribution, then equitable adjustments
shall be made to (i) the total number and/or class of securities subject to this
option and (ii) the Exercise Price in such manner as the Plan Administrator
deems appropriate in order to reflect such change and thereby prevent the
dilution or enlargement of benefits hereunder.

8.Stockholder Rights.  The holder of this option shall not have any stockholder
rights with respect to the Option Shares until such person shall have exercised
the option, paid the Exercise Price and become a holder of record of the
purchased shares.

9.

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Manner of Exercising Option.

(a)In order to exercise this option with respect to all or any part of the
Option Shares for which this option is at the time exercisable, Optionee (or any
other person or persons exercising the option) must take the following actions:

(i)Execute and deliver to the Corporation a Notice of Exercise for the Option
Shares for which the option is exercised or comply with such other procedures as
the Corporation may establish for notifying the Corporation of the exercise of
this option for one or more Option Shares.

(ii)Pay the aggregate Exercise Price for the purchased shares in one or more of
the following forms:

(A)cash or check made payable to the Corporation;

(B)shares of Common Stock valued at Fair Market Value on the Exercise Date and
held by Optionee (or any other person or persons exercising the option) for any
required period necessary to avoid a charge to the Corporation’s earnings for
financial reporting purposes; or

(C)through a special sale and remittance procedure pursuant to which Optionee
(or any other person or persons exercising the option) shall concurrently
provide irrevocable instructions (i) to a brokerage firm (reasonably
satisfactory to the Corporation for purposes of administering such procedure in
accordance with the Corporation’s pre-clearance/pre-notification policies) to
effect the immediate sale of the purchased shares and remit to the Corporation,
out of the sale proceeds available on the settlement date, sufficient funds to
cover the aggregate Exercise Price payable for the purchased shares plus all
applicable income and employment taxes required to be withheld by the
Corporation by reason of such exercise and (ii) to the Corporation to deliver
the certificates (which may be in electronic form) for the purchased shares
directly to such brokerage firm on such settlement date in order to complete the
sale.

Except to the extent the sale and remittance procedure is utilized in connection
with the option exercise, payment of the Exercise Price must accompany the
Notice of Exercise (or other notification procedure) delivered to the
Corporation in connection with the option exercise.

(iii)Furnish to the Corporation appropriate documentation that the person or
persons exercising the option (if other than Optionee) have the right to
exercise this option.

(iv)Make appropriate arrangements with the Corporation (or Parent or Subsidiary
employing or retaining Optionee) for the satisfaction of all applicable income
and employment tax withholding requirements applicable to the option exercise.

(b)As soon as practical after the Exercise Date, the Corporation shall issue to
or on behalf of Optionee (or any other person or persons exercising this option)
a certificate (which may be in electronic form) for the purchased Option Shares,
with the appropriate legends affixed thereto.

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(c)In no event may this option be exercised for any fractional shares.

10.Compliance with Laws and Regulations.

(a)The exercise of this option and the issuance of the Option Shares upon such
exercise shall be subject to compliance by the Corporation and Optionee with all
applicable requirements of law relating thereto and with all applicable
regulations of any stock exchange on which the Common Stock may be listed for
trading at the time of such exercise and issuance.

(b)The inability of the Corporation to obtain approval from any regulatory body
having authority deemed by the Corporation to be necessary to the lawful
issuance and sale of any Common Stock pursuant to this option shall relieve the
Corporation of any liability with respect to the non-issuance or sale of the
Common Stock as to which such approval shall not have been obtained.  The
Corporation, however, shall use commercially reasonable efforts to obtain all
such approvals.

11.Restrictive Covenants; Additional Conditions.

(a)As a condition of receiving this option, Optionee hereby acknowledges and
agrees that during the period in which the Optionee is employed by, or providing
service to, the Corporation, and for the Restrictive Covenant Period following
the date on which the Optionee ceases to be employed by, or provide service to,
the Corporation for any reason, the Optionee shall comply with the restrictive
covenants set forth herein.  The restrictive covenants set forth herein shall
not supersede and replace any other restrictions and obligations the Optionee
may be subject to with the Corporation and if there is a conflict between
comparable restrictions the more restrictive provisions shall control, as
reasonably determined by the Corporation.

(i)Optionee acknowledges that during the Optionee’s employment with the
Corporation, the Optionee will have access to, possess or help the Corporation
develop valuable proprietary commercial and/or technical information, trade
secrets and other confidential information belonging to the Corporation and will
be instrumental to the development and/or maintenance of goodwill with the
Corporation’s customers.  The Optionee acknowledges that such proprietary
information, trade secrets, confidential information and goodwill are valuable
assets of the Corporation and the Corporation has a legitimate interest in
protecting itself from disclosure or misappropriation of such information and
from interference with its goodwill relationships with its customers.

(ii)Other than in the ordinary course or for the benefit of the business of the
Corporation, during the term of Optionee’s employment with the Corporation and
thereafter, Optionee shall not, directly or indirectly, divulge, furnish or make
accessible to any other person, business, firm or corporation, or use in any
way, any Confidential Information of the Corporation which the Optionee has
acquired or become acquainted with or shall acquire or become acquainted with as
a result of the Optionee’s employment with the Corporation, whether developed by
the Optionee, or by others. The Confidential Information is the property of the
Corporation and Optionee acknowledges that the use, misappropriation or
disclosure of the Confidential Information would constitute a breach of trust,
fiduciary duty and would cause irreparable injury to the Corporation.
Furthermore, Optionee acknowledges that during the Optionee’s

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employment with the Corporation, the Optionee may be exposed to the confidential
information of customers and other third parties and the Optionee shall maintain
the confidentiality of this information and shall only use it as necessary to
carry out the work for the Corporation consistent with restrictions placed upon
such Confidential Information. Nothing contained herein shall restrict
Optionee’s use of general knowledge acquired by the Optionee as part of the
Optionee’s normal growth in the Optionee’s profession.

(iii)Optionee shall not, during the term of the Optionee’s employment with the
Corporation and for the Restrictive Covenant Period, render services as an
officer, owner (other than having less than two (2%) percent ownership of a
publicly traded corporation’s stock), director, consultant, employee, or other
service provider, to, or on behalf of, a Competing Business, provided, however,
this Paragraph 11(a)(iii) will not apply if the Optionee’s duties and
responsibilities for any Competing Business do not involve the Optionee in the
provision of any services that are similar to or competitive with the services
Optionee provided to the Corporation.  The Optionee acknowledges that the
Corporation is engaged in business throughout the world and that the marketplace
for the Corporation’s products and services is worldwide, and thus the
geographic area, length and scope of this noncompetition provision are
reasonable and necessary to protect the legitimate business interests of the
Corporation. In the event a court of competent jurisdiction determines that one
or more of the provisions are so broad as to be unenforceable, then such
provision shall be deemed to be reduced in scope or length, as the case may be,
to the extent required to make such Paragraphs enforceable.

(iv)Optionee shall disclose promptly and assign to the Corporation or the
Affiliate all right, title and interest in any invention or idea, patentable or
not, made or conceived by the Optionee during employment by the Corporation or
the Affiliate, relating in any manner to the actual or anticipated business,
research or development work of the Corporation or the Affiliate and shall do
anything reasonably necessary to enable the Corporation or the Affiliate to
secure a patent where appropriate in the United States and in foreign countries.

(v)Optionee shall not, directly or indirectly, solicit, for the purpose of
offering or attempting to offer any service, product or other application which
is the same as or similar to the services, products or other applications
offered or in the process of being developed by the Corporation within the last
year prior to termination of the Optionee’s employment with the Corporation, any
of the Corporation’s customers with whom the Optionee had contact, or about whom
the Optionee obtained, or had access to, confidential information during the
Optionee’s employment, for the Restrictive Covenant Period.  Optionee further
agrees, for the Restrictive Covenant Period, that the Optionee shall not solicit
or attempt to solicit any employee of, or consultant to, the Corporation, which
employee or consultant had been rendering services to the Corporation at any
time within the six-month period immediately preceding the termination of the
Optionee’s employment, to leave the employ of, or no longer render service to or
for the benefit of, the Corporation.

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(vi)Optionee shall not make any Disparaging Statements about the Corporation to
any of the Corporation’s past, present, or future customers, employees, clients,
contractors, vendors, or to the media or to any other person either orally or by
any other medium of communication, including internet communication.  As used
herein, the term “Disparaging Statement” means any communication, oral or
written, which would cause or tend to cause humiliation or embarrassment or to
cause a recipient of such communication to question the business condition,
integrity, product, service, quality, confidence, or good character of the
Corporation.

(b)Optionee acknowledges that a breach of any of the covenants contained in this
Agreement may cause irreparable damage to the Corporation, the exact amount of
which would be difficult to ascertain, and that the remedies at law for any such
breach or threatened breach would be inadequate.  Accordingly, Optionee agrees
that if the Optionee breaches or threatens to breach any of the covenants
contained in this Agreement, in addition to any other remedy which may be
available to the Corporation at law or in equity, the Corporation shall be
entitled to (i) rescind any exercise of this option, in which case the Optionee
shall pay to the Corporation, in cash or by returning to the Corporation the
Option Shares covered by this option; and/or (ii) institute and prosecute
proceedings in any court of competent jurisdiction for specific performance and
injunctive relief to prevent the breach or any threatened breach thereof without
bond or other security or a showing that monetary damages will not provide an
adequate remedy.  Optionee agrees to disclose in advance the existence and terms
of the restrictions and covenants contained in this Agreement to any employer or
service recipient by whom the Optionee might be employed or retained during the
period in which the covenants or restrictions apply. Optionee agrees that, in
the event of a final determination of Optionee’s breach of any of the covenants
contained in this Agreement, the restrictions in the relevant paragraph shall be
extended for a period equal to the period that Optionee was in breach.  Optionee
represents and acknowledges that the Optionee has been advised by the
Corporation to consult Optionee’s own legal counsel with respect to this
Agreement and Optionee has had full opportunity, prior to execution of this
Agreement, to review thoroughly this Agreement with Optionee’s legal counsel.

(c)Upon exercise of this option, the Plan Administrator may require the Optionee
to certify on a form acceptable to the Plan Administrator, that the Optionee is
in compliance with the terms, conditions, and restrictions of the Plan and this
Agreement.

(d)This option, and the right to receive and retain any Option Shares or cash
payments covered by this option, shall be subject to rescission, cancellation or
recoupment, in whole or part, if and to the extent so provided under any
“clawback” or similar policy of the Corporation in effect on the Grant Date or
that may be established thereafter, including any modification or amendment
thereto, or as required by the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall
Street Reform and Consumer Protection Act, or other applicable law.  By
accepting this option under the Plan, the Optionee agrees and acknowledges that
Optionee is obligated to cooperate with, and provide any and all assistance
necessary to, the Corporation to recover or cancel any option granted under the
Plan subject to claw-back pursuant to such law or policy.  Such cooperation and
assistance shall include, but is not limited to, executing, completing and
submitting any documentation necessary to recover or cancel any options granted
pursuant to this Agreement.

12.Successors and Assigns.  Except to the extent otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and
be binding upon,

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the Corporation and its successors and assigns and Optionee, Optionee’s assigns,
the legal representatives, heirs and legatees of Optionee’s estate and any
beneficiaries of this option designated by Optionee.

13.Notices.  Any notice required to be given or delivered to the Secretary of
the Corporation under the terms of this Agreement shall be in writing and
addressed to the Corporation at its principal corporate office at 436 Seventh
Avenue, Pittsburgh, PA 15219.  Any notice required to be given or delivered to
Optionee shall be in writing and addressed to Optionee at the address indicated
below Optionee’s signature line on the Grant Notice.  All notices shall be
deemed effective upon personal delivery or upon deposit in the U.S. mail,
postage prepaid and properly addressed to the party to be notified.

14.Construction.  This Agreement and the option evidenced hereby are made and
granted pursuant to the Plan and are in all respects limited by and subject to
the terms of the Plan.  All decisions of the Plan Administrator with respect to
any question or issue arising under the Plan or this Agreement shall be
conclusive and binding on all persons having an interest in this option.

15.Governing Law.  The interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the Commonwealth of Pennsylvania
without resort to Pennsylvania’s conflict-of-laws rules.

16.Excess Shares.  If the Option Shares covered by this Agreement exceed, as of
the Grant Date, the number of shares of Common Stock which may without
stockholder approval be issued under the Plan, then this option shall be void
with respect to those excess shares, unless stockholder approval of an amendment
sufficiently increasing the number of shares of Common Stock issuable under the
Plan is obtained in accordance with the provisions of the Plan.  In no event
shall the Option be exercisable with respect to any of the excess Option Shares
unless and until such stockholder approval is obtained.

17.Additional Terms Applicable to an Incentive Option.  In the event this option
is designated an Incentive Option in the Grant Notice, the following terms and
conditions shall also apply to the grant:

(a)This option shall cease to qualify for favorable tax treatment as an
Incentive Option if (and to the extent) this option is exercised for one or more
Option Shares: (A) more than three (3) months after the date Optionee ceases to
be an Employee for any reason other than death or Permanent Disability or (B)
more than twelve (12) months after the date Optionee ceases to be an Employee by
reason of Permanent Disability.

(b)No installment under this option shall qualify for favorable tax treatment as
an Incentive Option if (and to the extent) the aggregate Fair Market Value
(determined at the Grant Date) of the Common Stock for which such installment
first becomes exercisable hereunder would, when added to the aggregate value
(determined as of the respective date or dates of grant) of the Common Stock or
other securities for which this option or any other Incentive Options granted to
Optionee prior to the Grant Date (whether under the Plan or any other option
plan of the Corporation or any Parent or Subsidiary) first become exercisable
during the same calendar year, exceed One Hundred Thousand Dollars ($100,000) in
the aggregate.  Should such One Hundred Thousand Dollar ($100,000) limitation be
exceeded in any calendar year, this option

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shall nevertheless become exercisable for the excess shares in such calendar
year as a Non-Statutory Option.

(c)Should the exercisability of this option be accelerated upon a Change in
Control, then this option shall qualify for favorable tax treatment as an
Incentive Option only to the extent the aggregate Fair Market Value (determined
at the Grant Date) of the Common Stock for which this option first becomes
exercisable in the calendar year in which the Change in Control transaction
occurs does not, when added to the aggregate value (determined as of the
respective date or dates of grant) of the Common Stock or other securities for
which this option or one or more other Incentive Options granted to Optionee
prior to the Grant Date (whether under the Plan or any other option plan of the
Corporation or any Parent or Subsidiary) first become exercisable during the
same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the
aggregate.  Should the applicable One Hundred Thousand Dollar ($100,000)
limitation be exceeded in the calendar year of such Change in Control, the
option may nevertheless be exercised for the excess shares in such calendar year
as a Non-Statutory Option.

(d)Should Optionee hold, in addition to this option, one or more other options
to purchase Common Stock which become exercisable for the first time in the same
calendar year as this option, then for purposes of the foregoing limitations on
the exercisability of such options as Incentive Options, this option and each of
those other options shall be deemed to become first exercisable in that calendar
year, on the basis of the chronological order in which such options were
granted, except to the extent otherwise provided under applicable law or
regulation.

18.Survivability.  The terms of this Agreement survive the termination of
Optionee’s employment with the Corporation for any reason.

19.Severability.  In the event that any provision of this Agreement is
determined to be partially or wholly invalid, illegal or unenforceable in any
jurisdiction, then such provision shall, as to such jurisdiction, be modified or
restricted to the extent necessary to make such provision valid, binding and
enforceable, or if such provision cannot be modified or restricted, then such
provision shall, as to such jurisdiction, be deemed to be excised from this
Agreement; provided, however, that the binding effect and enforceability of the
remaining provisions of this Agreement, to the extent the economic benefits
conferred upon the parties by virtue of this Agreement remain substantially
unimpaired, shall not be affected or impaired in any manner, and any such
invalidity, illegality or unenforceability with respect to such provisions shall
not invalidate or render unenforceable such provision in any other jurisdiction.

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties have executed this Agreement on the Grant Date
indicated above.

 

 

 

KOPPERS HOLDINGS INC.

A

 

By:

 

Title:

President and CEO

 

 

 

Optionee  _______________________________

 

 

Signature:

 

Address:

 

B

 

C

 

 

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APPENDIX

The following definitions shall be in effect under the Agreement:

A.Affiliate means any entity that, directly or through one or more
intermediaries, is controlled by the Corporation, and any entity in which the
Corporation has a significant equity interest as determined by the Plan
Administrator.

B.Agreement shall mean this Stock Option Agreement.

C.Board shall mean the Corporation’s Board of Directors.

D.Change in Control of the Corporation shall have occurred in the event that:

(i)a person, partnership, joint venture, corporation or other entity, or two or
more of any of the foregoing acting as a “person” within the meaning of Sections
13(d)(3) of the 1934 Act, other than the Corporation, a majority-owned
subsidiary of the Corporation or an employee benefit plan of the Corporation or
such subsidiary (or such plan’s related trust), become(s) the “beneficial owner”
(as defined in Rule 13d-3 under the Act) of fifty percent (50%) or more of the
then outstanding voting stock of the Corporation;

(ii)during any period of two consecutive years, individuals who at the beginning
of such period constitute the Board (together with any new Board member whose
election by the Corporation’s Board or whose nomination for election by the
Corporation’s stockholders, was approved by a vote of at least two-thirds of the
Board members then still in office who either were Board members at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board members then in office;

(iii)all or substantially all of the business of the Corporation is disposed of
pursuant to a merger, consolidation or other transaction in which the
Corporation is not the surviving corporation or the Corporation combines with
another company and is the surviving corporation (unless the Corporation’s
stockholders immediately following such merger, consolidation, combination, or
other transaction beneficially own, directly or indirectly, more than fifty
percent (50%) of the aggregate voting stock or other ownership interests of (x)
the entity or entities, if any, that succeed to the business of the Corporation
or (y) the combined company);  

(iv)the closing of the sale of all or substantially all of the assets of the
Corporation or a liquidation or dissolution of the Corporation; or

(v)the acquisition, directly or indirectly, by any person or related group of
persons (other than the Corporation or a person that directly or indirectly
controls, is controlled by, or is under common control with, the Corporation) of
beneficial ownership (within the meaning of Rule 13d-3 of the Act) of securities
possessing more than twenty percent (20%) of the total combined voting power of
the Corporation’s outstanding securities pursuant to a tender or exchange offer
made directly to the Corporation’s stockholders which the Board does not
recommend such stockholders to accept.

 

E.Code shall mean the Internal Revenue Code of 1986, as amended.

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F.Common Stock shall mean shares of the Corporation’s common stock.

G.Competing Business shall mean: any person, corporation, partnership, joint
venture, association or other entity engaged in the development or offering or
attempting to offer any service, product, chemical formulation or other material
which: (i) is a direct or indirect product of the extraction or distillation of
coal tar; (ii) is utilized in the distillation, impregnation or treatment of
materials with coal tar, petroleum pitch or their respective by-products or
distillates; (iii) constitutes or is utilized in conjunction with railroad track
joints, ties, mounting hardware, bridge timbers, bridge crossings or bridging
assemblies; (iv) constitutes or is utilized in conjunction with utility poles
(including components thereof) or marine pilings; (v) is utilized for the
preservation or recovery of wood materials or (vi) constitutes any product or
service which was in the process of being developed by the Corporation within
the last year prior to termination of Optionee’s employment with the
Corporation.

H.Confidential Information shall mean any proprietary or confidential
information of the Corporation, including but not limited to any trade secrets,
confidential or secret designs, technologies, content, processes, formulae,
plans, manuals, devices, machines, know-how, methods, compositions, ideas,
improvements, financial and marketing information, costs, pricing, sales, sales
volume, methods and proposals, customer and prospective customer lists, identity
of key personnel in the employ of customers and prospective customers, amount or
kind of customer’s purchases from the Corporation, system documentation,
hardware, engineering and configuration information, computer programs, source
and object codes (whether or not patented, patentable, copyrighted or
copyrightable), related software development information, inventions or other
confidential or proprietary information belonging to the Corporation or directly
or indirectly relating to the Corporation’s business and affairs.

I.Corporation shall mean Koppers Holdings Inc., a Pennsylvania corporation, and
any successor corporation to all or substantially all of the assets or voting
stock of Koppers Holdings Inc. which shall by appropriate action adopt the Plan.

J.Disparaging Statements shall have the meaning set forth in Paragraph
11(a)(vi).

K.Employee shall mean an individual who is in the employ of the Corporation (or
any Parent or Subsidiary), subject to the control and direction of the employer
entity as to both the work to be performed and the manner and method of
performance.

L.Exercise Date shall mean the date on which the option shall have been
exercised in accordance with Paragraph 9 of the Agreement.

M.Exercise Price shall mean the exercise price per Option Share as specified in
the Grant Notice.

N.Expiration Date shall mean the date on which the option expires as specified
in the Grant Notice.

O.Fair Market Value per share of Common Stock on any relevant date shall be
determined in accordance with the following provisions:

(i)If the Common Stock is at the time traded on the Nasdaq Global Market, then
the Fair Market Value shall be the closing selling price per share of Common
Stock

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at the close of regular hours trading (i.e., before after-hours trading begins)
on the Nasdaq Global Market on the date in question, as such price is reported
by the National Association of Securities Dealers for that particular Stock
Exchange.  If there is no closing selling price for the Common Stock on the date
in question, then the Fair Market Value shall be the closing selling price on
the last preceding date for which such quotation exists.

(ii)If the Common Stock is at the time listed on any other Stock Exchange, then
the Fair Market Value shall be the closing selling price per share of Common
Stock at the close of regular hours trading (i.e., before after-hours trading
begins) on the date in question on the Stock Exchange determined by the Plan
Administrator to be the primary market for the Common Stock, as such price is
officially quoted in the composite tape of transactions on such exchange.  If
there is no closing selling price for the Common Stock on the date in question,
then the Fair Market Value shall be the closing selling price on the last
preceding date for which such quotation exists.

P.Family Member shall mean any of the following members of the Optionee’s
family: any child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law or sister-in-law.

Q.Grant Date shall mean the date of grant of the option as specified in the
Grant Notice.

R.Grant Notice shall mean the Notice of Grant of Stock Option accompanying the
Agreement, pursuant to which Optionee has been informed of the basic terms of
the option evidenced hereby.

S.Incentive Option shall mean an option which satisfies the requirements of Code
Section 422.

T.Misconduct shall mean the commission of any act of fraud, embezzlement or
dishonesty by Optionee, any unauthorized use or disclosure by Optionee of
confidential information or trade secrets of the Corporation (or any Parent or
Subsidiary), or any other intentional misconduct by Optionee adversely affecting
the business or affairs of the Corporation (or any Parent or Subsidiary) in a
material manner.  The foregoing definition shall not in any way preclude or
restrict the right of the Corporation (or any Parent or Subsidiary) to discharge
or dismiss Optionee or any other person in the Service of the Corporation (or
any Parent or Subsidiary) for any other acts or omissions, but such other acts
or omissions shall not be deemed, for purposes of the Plan or this Agreement, to
constitute grounds for termination for Misconduct.

U.Non-Statutory Option shall mean an option not intended to satisfy the
requirements of Code Section 422.

V.Notice of Exercise shall mean the notice of option exercise in the form
prescribed by the Corporation.

W.Option Shares shall mean the number of shares of Common Stock subject to the
option as specified in the Grant Notice.

X.Optionee shall mean the person to whom the option is granted as specified in
the Grant Notice.

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Y.Parent shall mean any corporation (other than the Corporation) in an unbroken
chain of corporations ending with the Corporation, provided each corporation in
the unbroken chain (other than the Corporation) owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

Z.Permanent Disability shall mean the inability of Optionee to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which is expected to result in death or to be of continuous
duration of twelve (12) months or more.

AA.Plan shall mean the Corporation’s 2018 Long Term Incentive Plan.

BB.Plan Administrator shall mean the committee(s) designated by the Board to
administer the Plan.

CC.Restrictive Covenant Period shall mean the two-year period following an
Optionee’s termination of employment from the Corporation for any reason.

DD.Retirement shall mean the Optionee’s voluntary termination from Service (i)
on or after his attainment of age sixty-five (65), or (ii) on or after his
attainment of age 55 with at least ten (10) years of service, or involuntary
termination from Service with at least thirty (30) years of service other than
in connection with a termination for Misconduct.  “Years of service” means the
Optionee’s total number of years of “accumulated service” as such term is
defined with respect to salaried employees under the Retirement Plan for Koppers
Inc. (regardless of whether the Optionee is eligible to receive a benefit under
such plan).

EE.  Service shall mean the Optionee’s performance of services for the
Corporation (or any Parent or Subsidiary, whether now existing or subsequently
established) by a person in the capacity of an Employee, a non-employee member
of the board of directors or a consultant or independent advisor.  However, the
Optionee shall be deemed to cease Service immediately upon the occurrence of
either of the following events: (i) the Optionee no longer performs services in
any of the foregoing capacities for the Corporation or any Parent or Subsidiary
or (ii) the entity for which the Optionee is performing such services ceases to
remain a Parent or Subsidiary of the Corporation, even though the Optionee may
subsequently continue to perform services for that entity.  Service shall not be
deemed to cease during a period of military leave, sick leave or other personal
leave approved by the Corporation; provided, however, that should such leave of
absence exceed three (3) months, then for purposes of determining the period
within which the option may be exercised as an Incentive Stock Option under the
federal tax laws (if the option is designated as such in the Grant Notice), the
Optionee’s Service shall be deemed to cease on the first day immediately
following the expiration of such three (3)-month period, unless the Optionee is
provided, either by statute or by written contract, with the right to return to
Service following such leave.  Except to the extent otherwise required by law or
expressly authorized by the Plan Administrator or by the Corporation’s written
policy on leaves of absence, no Service credit shall be given for vesting
purposes for any period the Optionee is on a leave of absence.

FF. Stock Exchange shall mean the Nasdaq Global Market, the New York Stock
Exchange or such other stock exchange on which the Common Stock is listed.

GG. Subsidiary shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations beginning with the Corporation, provided each
corporation (other

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than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

HH.Vesting Schedule shall mean the schedule set forth in the Grant Notice
pursuant to which the option is to become exercisable for the Option Shares in
one or more installments over the Optionee’s period of Service.

 

 

 

 

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