EXHIBIT 10.9

 

MONACO COACH CORPORATION

 

DIRECTOR OPTION AGREEMENT

 

SUBSEQUENT GRANT

 

Monaco Coach Corporation, a Delaware corporation (the “Company”), has granted to
                                        (the “Optionee”), an option to purchase
a total of four thousand (4,000) shares of the Company’s Common Stock (the
“Optioned Stock”), at the price determined as provided herein, and in all
respects subject to the terms, definitions and provisions of the Company’s
Director Stock Plan (as amended May 13, 2003) (the “Plan”) adopted by the
Company which is incorporated herein by reference. The terms defined in the Plan
shall have the same defined meanings herein.

 

1.             NATURE OF THE OPTION. THIS OPTION IS A NONSTATUTORY OPTION AND IS
NOT INTENDED TO QUALIFY FOR ANY SPECIAL TAX BENEFITS TO THE OPTIONEE.

 

2.             EXERCISE PRICE. THE EXERCISE PRICE IS $                FOR EACH
SHARE OF COMMON STOCK.

 

3.             EXERCISE OF OPTION. THIS OPTION SHALL BE EXERCISABLE DURING ITS
TERM IN ACCORDANCE WITH THE PROVISIONS OF SECTION 11 OF THE PLAN AS FOLLOWS:

 

(I)            RIGHT TO EXERCISE.

 

(A)           THIS OPTION SHALL BECOME EXERCISABLE AS TO ONE HUNDRED
PERCENT (100%) OF THE SHARES SUBJECT TO THIS AGREEMENT FIVE (5) YEARS FROM THE
DATE OF GRANT IF, ON SUCH DATE, OPTIONEE HAS MAINTAINED HIS CONTINUOUS STATUS AS
A DIRECTOR.

 

(B)           THIS OPTION MAY NOT BE EXERCISED FOR A FRACTION OF A SHARE.

 

(C)           IN THE EVENT OF OPTIONEE’S DEATH, DISABILITY, RETIREMENT OR OTHER
TERMINATION OF CONTINUOUS STATUS AS A DIRECTOR, THE EXERCISABILITY OF THE OPTION
IS GOVERNED BY SECTION 11 OF THIS AGREEMENT.

 

(II)           METHOD OF EXERCISE. THIS OPTION SHALL BE EXERCISABLE BY WRITTEN
NOTICE, WHICH SHALL STATE THE ELECTION TO EXERCISE THE OPTION AND THE NUMBER OF
SHARES IN RESPECT OF WHICH THE OPTION IS BEING EXERCISED. SUCH WRITTEN NOTICE,
IN THE FORM ATTACHED HERETO AS EXHIBIT A, SHALL BE SIGNED BY THE OPTIONEE AND
SHALL BE DELIVERED IN PERSON OR BY CERTIFIED MAIL TO THE SECRETARY OF THE
COMPANY. THE WRITTEN NOTICE SHALL BE ACCOMPANIED BY PAYMENT OF THE EXERCISE
PRICE.

 

4.             METHOD OF PAYMENT. PAYMENT OF THE EXERCISE PRICE SHALL BE BY ANY
OF THE FOLLOWING, OR A COMBINATION THEREOF, AT THE ELECTION OF THE OPTIONEE:

 

(I)            CASH;

 

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(II)           CHECK; OR

 

(III)          SURRENDER OF OTHER SHARES WHICH (X) IN THE CASE OF SHARES
ACQUIRED UPON EXERCISE OF AN OPTION, HAVE BEEN OWNED BY THE OPTIONEE FOR MORE
THAN SIX (6) MONTHS ON THE DATE OF SURRENDER, AND (Y) HAVE A FAIR MARKET VALUE
ON THE DATE OF SURRENDER EQUAL TO THE AGGREGATE EXERCISE PRICE OF THE SHARES AS
TO WHICH SAID OPTION SHALL BE EXERCISED; OR

 

(IV)          DELIVERY OF A PROPERLY EXECUTED EXERCISE NOTICE TOGETHER WITH SUCH
OTHER DOCUMENTATION AS THE COMPANY AND THE BROKER, IF APPLICABLE, SHALL REQUIRE
TO EFFECT AN EXERCISE OF THE OPTION AND DELIVERY TO THE COMPANY OF THE SALE OR
LOAN PROCEEDS REQUIRED TO PAY THE EXERCISE PRICE.

 

5.             RESTRICTIONS ON EXERCISE. THIS OPTION MAY NOT BE EXERCISED IF THE
ISSUANCE OF SUCH SHARES UPON SUCH EXERCISE OR THE METHOD OF PAYMENT OF
CONSIDERATION FOR SUCH SHARES WOULD CONSTITUTE A VIOLATION OF ANY APPLICABLE
FEDERAL OR STATE SECURITIES OR OTHER LAW OR REGULATIONS, OR IF SUCH ISSUANCE
WOULD NOT COMPLY WITH THE REQUIREMENTS OF ANY STOCK EXCHANGE UPON WHICH THE
SHARES MAY THEN BE LISTED. AS A CONDITION TO THE EXERCISE OF THIS OPTION, THE
COMPANY MAY REQUIRE OPTIONEE TO MAKE ANY REPRESENTATION AND WARRANTY TO THE
COMPANY AS MAY BE REQUIRED BY ANY APPLICABLE LAW OR REGULATION.

 

6.             TERMINATION OF CONTINUOUS STATUS AS A DIRECTOR. IN THE EVENT
OPTIONEE’S CONTINUOUS STATUS AS A DIRECTOR TERMINATES (OTHER THAN UPON THE
OPTIONEE’S DEATH OR PERMANENT AND TOTAL DISABILITY (AS DEFINED IN
SECTION 22(E)(3) OF THE CODE)), THE OPTIONEE MAY EXERCISE HIS OR HER OPTION, BUT
ONLY WITHIN THREE (3) MONTHS FROM THE DATE OF SUCH TERMINATION, AND ONLY TO THE
EXTENT THAT THE OPTIONEE WAS ENTITLED TO EXERCISE IT AT THE DATE OF SUCH
TERMINATION (BUT IN NO EVENT LATER THAN THE EXPIRATION OF ITS TEN (10) YEAR
TERM). TO THE EXTENT THAT THE OPTIONEE WAS NOT ENTITLED TO EXERCISE THIS OPTION
AT THE DATE OF SUCH TERMINATION, AND TO THE EXTENT THAT OPTIONEE DOES NOT
EXERCISE THIS OPTION (TO THE EXTENT OTHERWISE SO ENTITLED) WITHIN THE TIME
SPECIFIED HEREIN, THE OPTION SHALL TERMINATE.

 

7.             DISABILITY OF OPTIONEE. IN THE EVENT OPTIONEE’S CONTINUOUS STATUS
AS A DIRECTOR TERMINATES AS A RESULT OF TOTAL AND PERMANENT DISABILITY (AS
DEFINED IN SECTION 22(E)(3) OF THE CODE), THE OPTION GRANTED HEREUNDER TO SUCH
OPTIONEE SHALL BECOME VESTED AND EXERCISABLE FOR THE FULL NUMBER OF SHARES
COVERED BY THE OPTION. THE OPTIONEE MAY EXERCISE HIS OR HER OPTION, AT ANY TIME
WITHIN TWELVE (12) MONTHS FROM THE DATE OF SUCH TERMINATION (BUT IN NO EVENT
LATER THAN THE EXPIRATION OF THE TERM OF SUCH OPTION AS SET FORTH IN THE NOTICE
OF GRANT). IF, AFTER TERMINATION, THE OPTIONEE DOES NOT EXERCISE HIS OR HER
OPTION WITHIN THE TIME SPECIFIED HEREIN, THE OPTION SHALL TERMINATE, AND THE
SHARES COVERED BY SUCH OPTION SHALL REVERT TO THE PLAN.

 

8.             DEATH OF OPTIONEE. IN THE EVENT OF THE DEATH OF AN OPTIONEE, THE
OPTION SHALL BECOME VESTED AND EXERCISABLE FOR THE FULL NUMBER OF SHARES COVERED
BY THE OPTION. THE OPTION HELD BY THE OPTIONEE AT THE TIME OF DEATH MAY BE
EXERCISED AT ANY TIME WITHIN TWELVE (12) MONTHS FOLLOWING THE DATE OF DEATH BY
THE OPTIONEE’S ESTATE OR BY A PERSON WHO ACQUIRED THE RIGHT TO EXERCISE THE
OPTION BY BEQUEST OR INHERITANCE. IN NO EVENT SHALL AN OPTION BE EXERCISED LATER
THAN THE EXPIRATION OF THE TERM OF THE OPTION, AS SET FORTH IN THE OPTION
AGREEMENT. IF, AFTER DEATH, THE OPTIONEE’S ESTATE OR A PERSON WHO ACQUIRED THE
RIGHT TO EXERCISE THE OPTION BY BEQUEST OR INHERITANCE DOES NOT EXERCISE THE
OPTION WITHIN THE TIME SPECIFIED HEREIN, THE OPTION SHALL TERMINATE, AND THE
SHARES COVERED BY SUCH OPTION SHALL REVERT TO THE PLAN.

 

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9.             RETIREMENT OF OPTIONEE. IN THE EVENT OF AN OPTIONEE’S RETIREMENT
WHILE A DIRECTOR, THE OPTION SHALL BECOME VESTED AND EXERCISABLE FOR THE FULL
NUMBER OF SHARES COVERED BY THE OPTION. THE OPTION HELD BY THE OPTIONEE AT THE
TIME OF RETIREMENT MAY BE EXERCISED AT ANY TIME WITHIN TWELVE (12) MONTHS
FOLLOWING THE DATE OF RETIREMENT (BUT IN NO EVENT LATER THAN THE DATE OF
EXPIRATION OF ITS TEN (10) YEAR TERM). IF THE OPTION IS NOT EXERCISED WITHIN THE
TIME SPECIFIED HEREIN, THE OPTION SHALL TERMINATE.

 

10.           NON-TRANSFERABILITY OF OPTION. THIS OPTION MAY NOT BE TRANSFERRED
IN ANY MANNER OTHERWISE THAN BY WILL OR BY THE LAWS OF DESCENT OR DISTRIBUTION
AND MAY BE EXERCISED DURING THE LIFETIME OF OPTIONEE ONLY BY THE OPTIONEE. THE
TERMS OF THIS OPTION SHALL BE BINDING UPON THE EXECUTORS, ADMINISTRATORS, HEIRS,
SUCCESSORS AND ASSIGNS OF THE OPTIONEE.

 

11.           TERM OF OPTION. THIS OPTION MAY NOT BE EXERCISED MORE THAN
TEN (10) YEARS FROM THE VESTING COMMENCEMENT DATE OF THIS OPTION, AND MAY BE
EXERCISED DURING SUCH PERIOD ONLY IN ACCORDANCE WITH THE PLAN AND THE TERMS OF
THIS OPTION.

 

12.           TAXATION UPON EXERCISE OF OPTION. OPTIONEE UNDERSTANDS THAT, UPON
EXERCISE OF THIS OPTION, HE WILL RECOGNIZE INCOME FOR TAX PURPOSES IN AN AMOUNT
EQUAL TO THE EXCESS OF THE THEN FAIR MARKET VALUE OF THE SHARES PURCHASED OVER
THE EXERCISE PRICE PAID FOR SUCH SHARES. SINCE THE OPTIONEE IS SUBJECT TO
SECTION 16(B) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, UNDER CERTAIN
LIMITED CIRCUMSTANCES THE MEASUREMENT AND TIMING OF SUCH INCOME (AND THE
COMMENCEMENT OF ANY CAPITAL GAIN HOLDING PERIOD) MAY BE DEFERRED, AND THE
OPTIONEE IS ADVISED TO CONTACT A TAX ADVISOR CONCERNING THE APPLICATION OF
SECTION 83 IN GENERAL AND THE AVAILABILITY AN 83(B) ELECTION IN PARTICULAR IN
CONNECTION WITH THE EXERCISE OF THE OPTION. UPON A RESALE OF SUCH SHARES BY THE
OPTIONEE, ANY DIFFERENCE BETWEEN THE SALE PRICE AND THE FAIR MARKET VALUE OF THE
SHARES ON THE DATE OF EXERCISE OF THE OPTION, TO THE EXTENT NOT INCLUDED IN
INCOME AS DESCRIBED ABOVE, WILL BE TREATED AS CAPITAL GAIN OR LOSS.

 

Dated:

 

 

 

MONACO COACH CORPORATION,

 

 

a Delaware corporation

 

 

 

 

 

 

 

 

By:

 

 

Optionee acknowledges receipt of a copy of the Plan, a copy of which is annexed
hereto, and represents that he is familiar with the terms and provisions
thereof, and hereby accepts this Option subject to all of the terms and
provisions thereof. Optionee hereby agrees to accept as binding, conclusive and
final all decisions or interpretations of the Board upon any questions arising
under the Plan.

 

Dated:

 

 

 

 

 

 

Optionee

 

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