Exhibit 10.26


 


STR Holdings, Inc.

2009 Equity Incentive Plan


 


NONQUALIFIED
STOCK OPTION AWARD AGREEMENT


 


THIS AGREEMENT (the “Award Agreement”) is made
effective as of [                          ]
(the “Date of Grant”) between STR Holdings, Inc., a Delaware corporation (with
any successor, the “Company”), and [                      ]
(the “Participant”):


 


R E C I T A L S:


 


WHEREAS, the Company has adopted the STR Holdings, Inc.

2009 Equity Incentive Plan (the “Plan”), which Plan is incorporated herein by
reference and made a part of this Award Agreement.  Capitalized terms not otherwise defined herein
shall have the same meanings as in the Plan; and


 


WHEREAS, the Committee has determined that it would
be in the best interests of the Company and its stockholders to grant the
option provided for herein to the Participant pursuant to the Plan and the
terms set forth herein.


 


NOW THEREFORE, in consideration of the mutual
covenants hereinafter set forth, the parties agree as follows:


 


1.             Grant of the Option.  The Company hereby grants to the Participant
the right and option (the “Option”) to purchase, on the terms and conditions
hereinafter set forth, all or any part of an aggregate of [                ]
Shares, subject to adjustment as set forth in the Plan.   The
Option is intended to be a nonqualified stock option, and is not intended to be
treated as an option that complies with Section 422 of the Internal
Revenue Code of 1986, as amended.


 


2.             Option Price.  The purchase price of the Shares subject to
the Option shall be $[        ] per
Share (the “Option Price”), subject to adjustment as set forth in the Plan.


 


3.             [Vesting.  Subject to the Participant’s continued Service
on each vesting date, the Option shall vest in equal installments on each of
the [                          ]
anniversaries of the Date of Grant, so that [    ]% of the Option
shall vest on each such anniversary.]


 


At any time, the portion of the Option which has
become vested as described in this Section 3 is hereinafter referred to as
the “Vested Portion.”  The Vested Portion
of the Option shall remain exercisable for the period set forth in Section 6.


 


4.             Accelerated Vesting Upon a
Change in Control. Upon the occurrence of a Change of Control, the unvested
portion of the Option, to the extent not previously cancelled or forfeited, shall
immediately vest in full, so long as the Participant’s Service has not been
terminated before the date of the consummation of the Change of Control.


 


5.             Forfeiture.   If the
Participant’s Service is terminated for any reason, the Option shall, to the
extent not then vested, be cancelled by the Company without consideration and
the Vested Portion of the Option shall remain exercisable for the period set
forth in Section 6.


 

















 


6.             Exercise of Option.


 


(a)           Period of Exercise.  Subject to the provisions of the Plan and this
Award Agreement, the Participant may exercise all or any part of the Vested
Portion of the Option at any time prior to the earliest to occur of:


 


(i)            the [          ]
anniversary of the Date of Grant;


 


(ii)           the date that is ninety (90) days following
termination of the Participant’s Service for any reason other than death,
Permanent Disability or Cause;


 


(iii)          the date that is one (1) year following
termination of the Participant’s Service due to death or Permanent Disability;


 


(iv)          the date of termination of the Participant’s Service
due to Cause.


 


(b)           Method of Exercise.


 


(i)            Subject to Section 4, the Vested Portion of the
Option may be exercised by delivering to the Company at its principal office written
notice of intent to so exercise; provided that the Option may be
exercised with respect to whole Shares only.  Such notice shall specify the number of Shares
for which the Option is being exercised and shall be accompanied by payment in
full of the Option Price.  In the event
the Option is being exercised by the Participant’s representative, the notice
shall be accompanied by proof (satisfactory to the Committee) of the
representative’s right to exercise the Option. 
The payment of the Option Price may be made at the election of the
Participant (A) in cash or its equivalent (e.g., by cashier’s check), (B) to
the extent permitted by the Committee, in Shares having a Fair Market Value
equal to the aggregate Option Price for the Shares being purchased and
satisfying such other requirements as may be imposed by the Committee, (C) partly
in cash and, to the extent permitted by the Committee, partly in such Shares, (D) by
reducing the number of Shares otherwise deliverable upon the exercise of the
Option by the number of Shares having a Fair Market Value equal to the Option
Price, or (E) if there is a public market for the Shares at such time,
subject to such requirements as may be imposed by the Committee, through the
delivery of irrevocable instructions to a broker to sell Shares obtained upon
the exercise of the Option and to deliver promptly to the Company an amount out
of the proceeds of such sale equal to the aggregate Option Price for the Shares
being purchased.  The Committee may
prescribe any other method of payment that it determines to be consistent with
applicable law.  Neither the Participant nor
the Participant’s representative shall have any rights to dividends or other
rights of a stockholder with respect to Shares subject to an Option until the
Participant has given written notice of exercise of the Option, paid in full
for such Shares and, if applicable, has satisfied any other conditions imposed
by the Committee pursuant to the Plan.


 


(ii)           Notwithstanding any other provision of the Plan or
this Award Agreement to the contrary, the Option may not be exercised prior to
the completion of any registration or qualification of the Option or the Shares
under applicable securities or other laws, or under any ruling or regulation of
any governmental body or national securities exchange that the Committee shall
in its sole discretion determine to be necessary or advisable.


 


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(iii)          Upon the Company’s determination that the Option has
been validly exercised as to any of the Shares, the Company shall issue
certificates in the Participant’s name for such Shares.  However, the Company shall not be liable to
the Participant for damages relating to any delays in issuing the certificates
to him, any loss of the certificates, or any mistakes or errors in the issuance
of the certificates or in the certificates themselves.


 


(iv)          In the event of the Participant’s death, the Vested
Portion of the Option shall remain exercisable during the period set forth in Section 6
by the Participant’s executor or administrator, or the person or persons to
whom the Participant’s rights under this Award Agreement shall pass by will or
by the laws of descent and distribution as the case may be.  Any heir or legatee of the Participant shall
take rights herein granted subject to the terms and conditions hereof.


 


7.             No Right to Continued Service.  The granting of the Option evidenced hereby
and this Award Agreement shall impose no obligation on the Company or any
Affiliate to continue the Service of the Participant and shall not lessen or
affect any right that the Company or any Affiliate may have to terminate the Service
of such Participant.


 


8.             Securities Laws/Legend on
Certificates.  The
issuance and delivery of Shares shall comply with all applicable requirements
of law, including (without limitation) the Securities Act of 1933, as amended,
the rules and regulations promulgated thereunder, state securities laws
and regulations, and the regulations of any stock exchange or other securities
market on which the Company’s securities may then be traded.  If the Company deems it necessary to ensure
that the issuance of securities under the Plan is not required to be registered
under any applicable securities laws, each Participant to whom such security
would be issued shall deliver to the Company an agreement or certificate
containing such representations, warranties and covenants as the Company may
deem necessary which satisfies such requirements. The certificates representing
the Shares shall be subject to such stop transfer orders and other restrictions
as the Committee may deem reasonably advisable, and the Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.


 


9.             Transferability.  The Option may not be assigned, alienated,
pledged, attached, sold or otherwise transferred or encumbered by the
Participant other than by will or by the laws of descent and distribution, and
any such purported assignment, alienation, pledge, attachment, sale, transfer
or encumbrance shall be void and unenforceable against the Company or any
Affiliate; provided that the designation of a beneficiary shall not
constitute an assignment, alienation, pledge, attachment, sale, transfer or
encumbrance.  No such permitted transfer
of the Option to heirs or legatees of the Participant shall be effective to
bind the Company unless the Committee shall have been furnished with written
notice thereof and a copy of such evidence as the Committee may deem necessary
to establish the validity of the transfer and the acceptance by the transferee
or transferees of the terms and conditions hereof.  During the Participant’s lifetime, the Option
is exercisable only by the Participant.


 


10.           Adjustment of Option.  Adjustments to the Option (or any of the
Shares underlying the Option) shall be made in accordance with the terms of the
Plan.


 


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11.           Definitions.  For purposes of this Award Agreement:


 


“Cause” shall have the meaning set forth in the
Participant’s employment agreement with the Company or its Affiliates, if any,
or if the Participant is not a party to an employment agreement with a
definition of “Cause,” then “Cause” means the Participant’s (i) commission of fraud, embezzlement,
misappropriation of funds, material misrepresentation, breach of fiduciary duty
or other act of dishonesty against the Company or any of its Affiliates; (ii) conviction
of a felony or of a misdemeanor if such misdemeanor involves moral turpitude or
misrepresentation, including a plea of guilty or nolo contendere; (iii) material
breach of any employment agreement or non-competition agreement, which breach
is not cured within 30 days following written notice; (iv) intentional
wrongful act or gross negligence that has a material detrimental effect on the
Company or its Affiliates; (v) unlawful use (including being under the
influence) or possession of illegal drugs on the Company’s or any of its
Affiliates’ premises; and (vi) the failure or refusal to follow the
reasonable instructions of the board of directors of the Company or of any
Affiliate of the Company, which failure or refusal is not cured within 30 days
following written notice.


 


“Permanent Disability” shall have the meaning set
forth in the Participant’s employment agreement with the Company or its
Affiliates, if any, or if the Participant is not a party to an employment
agreement with a definition of “Permanent Disability,” then “Permanent
Disability” means any physical or mental disability rendering the Participant
unable to perform his or her duties for a period of at least one hundred twenty
(120) days out of any twelve (12) month period.


 


“Share” means a share of common
stock of the Company or such other class or kind of shares or other securities
resulting from the application of Section 12.1 of the Plan.


 


12.           Withholding.  The Participant may be required to pay to the
Company or any Affiliate and the Company shall have the right and is hereby
authorized to withhold, any applicable withholding taxes in respect of the
Option, its exercise or any payment or transfer under or with respect to the
Option and to take such other action as may be necessary in the opinion of the
Committee to satisfy all obligations for the payment of such withholding taxes.


 


13.           Notices. Any
notification required by the terms of this Award Agreement shall be given in
writing and shall be deemed effective upon personal delivery or within three (3) days
of deposit with the United States Postal Service, by registered or certified
mail, with postage and fees prepaid.  A
notice shall be addressed to the Company, Attention: Secretary, at its
principal executive office and to the Participant at the address that he or she
most recently provided to the Company.


 


14.           Entire Agreement.  This Award Agreement and the Plan constitute
the entire contract between the parties hereto with regard to the subject
matter hereof.  They supersede any other
agreements, representations or understandings (whether oral or written and whether
express or implied) which relate to the subject matter hereof.


 


15.           Waiver.  No waiver of any breach or condition of this Award
Agreement shall be deemed to be a waiver of any other or subsequent breach or
condition whether of like or different nature.


 


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16.           Successors and Assigns.  The provisions of this Award Agreement shall
inure to the benefit of, and be binding upon, the Company and its successors
and assigns and upon the Participant, the Participant’s assigns and the legal
representatives, heirs and legatees of the Participant’s estate, whether or not
any such person shall have become a party to this Award Agreement and agreed in
writing to be joined herein and be bound by the terms hereof.


 


17.           Choice of Law;
Jurisdiction; Waiver of Jury Trial.  THIS AWARD AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF DELAWARE WITHOUT
REGARD TO CONFLICTS OF LAWS.


 


SUBJECT TO THE TERMS OF THIS AWARD AGREEMENT, THE
PARTIES AGREE THAT ANY AND ALL ACTIONS ARISING UNDER OR IN RESPECT OF THIS
AWARD AGREEMENT SHALL BE LITIGATED IN THE FEDERAL OR STATE COURTS IN DELAWARE.  BY EXECUTING AND DELIVERING THIS AWARD AGREEMENT,
EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF SUCH COURTS FOR
ITSELF, HIMSELF OR HERSELF AND IN RESPECT OF ITS, HIS OR HER PROPERTY WITH
RESPECT TO SUCH ACTION.  EACH PARTY
AGREES THAT VENUE WOULD BE PROPER IN ANY OF SUCH COURTS, AND HEREBY WAIVES ANY
OBJECTION THAT ANY SUCH COURT IS AN IMPROPER OR INCONVENIENT FORUM FOR THE
RESOLUTION OF ANY SUCH ACTION.


 


EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AWARD AGREEMENT.


 


18.           Option Subject to Plan.  By entering into this Award Agreement the
Participant agrees and acknowledges that the Participant has received and read
a copy of the Plan.  The Option is
subject to the Plan.  The terms and
provisions of the Plan as it may be amended from time to time are hereby
incorporated herein by reference (subject to the limitation set forth in Section 19).
 In the event of a conflict between any
term or provision contained herein and a term or provision of the Plan, the
applicable terms and provisions of the Plan will govern and prevail.  The Participant
has had the opportunity to retain counsel, and has read carefully, and
understands, the provisions of the Plan and the Award Agreement.


 


19.           Amendment.  The Committee may amend or alter this Award
Agreement and the Option granted hereunder at any time; provided that,
subject to Articles 11, 12 and 13 of the Plan, no such amendment or alteration
shall be made without the consent of the Participant if such action would
materially diminish any of the rights of the Participant under this Award
Agreement or with respect to the Option.


 


20.           Severability. The provisions of this Award Agreement are severable and if any one or
more provisions are determined to be illegal or otherwise unenforceable, in
whole or in part, the remaining provisions shall nevertheless be binding and
enforceable.


 


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21.           Signature in Counterparts.  This Award Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.


 


[SIGNATURE PAGE FOLLOWS]


 


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IN WITNESS WHEREOF, the parties hereto have executed
this Award Agreement.


 


	
   

  	
  STR
  HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Agreed
  and acknowledged as

  	
   

  	
   

  
	
  of
  the date first above written:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  PARTICIPANT