EXHIBIT 10.2


 


SUMMA INDUSTRIES


STOCK OPTION PLAN


 


STOCK OPTION AGREEMENT


 


(NONSTATUTORY STOCK OPTION)


 


This Agreement is made and entered into effective as of               , by and between Summa Industries, a Delaware corporation
(the “Corporation”), and               
(the “Optionee”).


 


R E C I T A L S


 


A.  The Board of Directors of the
Corporation (the “Board”) has adopted, and the stockholders of the Corporation
have approved, the Summa Industries 1995 Stock Option Plan (the “Plan”) in
order to provide key employees and directors of, and key consultants, vendors,
customers, and others expected to provide significant services to, the
Corporation, with a favorable opportunity to acquire shares of the Corporation’s
common stock (the “Stock”).


 


B.  Pursuant to the Plan options
may be granted which are intended to qualify as Incentive Stock Options which
are afforded special tax treatment under Section 422A of the Internal
Revenue Code of 1986, as amended (the “Code”), as well as Nonstatutory Options
which are not intended to so qualify.


 


C.  The Board has by resolution
duly adopted that it is in the best interests of the Corporation and its
stockholders to grant to Optionee, as an employee of the Corporation, the
option to purchase shares of Stock on the terms and conditions provided for in
this Agreement, as an inducement to Optionee to continue to remain in the
service of the Corporation and to provide Optionee with additional incentive
for increasing his or her efforts and contributions to the success of the
Corporation during such service.


 


NOW THEREFORE, it is agreed as follows:


 


1.  Definitions and
Incorporation.  The terms used in
this Agreement shall have the meanings given to such terms in the Plan.  The Plan is hereby incorporated in and made a
part of this Agreement as if fully set forth herein.  The Optionee hereby acknowledges receipt of a
copy of the Plan.


 


2.  Grant of Option.  The Corporation hereby grants to Optionee as
of the date hereof the right and option to purchase, on the terms and conditions
hereinafter set forth, all or any part of an aggregate of      
shares of Stock (the “Option”), subject to adjustment in accordance with Section 10
of the Plan.  It is understood and
acknowledged that the Option will be a Nonstatutory Stock Option which will
not qualify as an Incentive Stock Option under Section 422A of the Code.


 


3.  Option Price.            The
price to be paid for Stock upon exercise of the Option or any part thereof
shall be $      per
share (the “Purchase Price”), which is equal to or greater than 85% of the Fair
Market Value of one share of Stock as of the date hereof.


 


4.  Right to Exercise.  Subject to the conditions set forth in this
Agreement, the option shall become exercisable in four cumulative installments
as follows:


 


(i)             The
first installment shall consist of 25% of the shares subject to the Option and
shall become exercisable on the first anniversary of the date the Option is
granted.


 


(ii)          The
second installment shall consist of 25% of the shares subject to the Option and
shall become exercisable on the second anniversary of the date the Option is
granted.


 


(iii)       The
third installment shall consist of 25% of the shares subject to the Option and
shall become exercisable on the third anniversary of the date the option is
granted.


 


(iv)      The
fourth installment shall consist of 25% of the shares subject to the Option and
shall become exercisable on the fourth anniversary of the date the Option is
granted.


 





















 


The unexercised portion of the Option may not be exercised after
Participant ceases to be an Employee, except as otherwise provided in paragraph
7 below.


 


5.  Securities Law
Requirements.  No part of the Option
shall be exercised if counsel to the Corporation determines that any applicable
registration requirement under the Securities Act of 1933, as amended, or any
other applicable requirement of Federal or state law has not been met.


 


6.  Term of Option.  The Option shall terminate on the earliest to
occur of (a) the      rd day of          ,
20     at 4:00 P.M. Pacific Time, (b) the
expiration of the period described in Paragraph 7 below, (c) the
expiration of the period described in Paragraph 8 below, or (d) the
expiration of the period described in Paragraph 9 below.


 


7.  Exercise Following
Termination of Service.  If the
Optionee’s service as an employee of the Corporation terminates for any reason
other than death, disability or retirement, the Option (to the extent it has
not previously been exercised and is then exercisable in accordance with the
provisions of paragraph 4 above) will terminate 30 days after such termination
of service.  The foregoing
notwithstanding, the Option shall cease to be exercisable on the date of such
termination if the termination is for cause or if the Optionee upon such
termination becomes an employee, director or consultant of a person who is in
direct competition with the Corporation. 
For this purpose, “cause” shall mean conviction of a felony,
misappropriation of assets of the Corporation or any subsidiary, continued or
repeated insobriety, continued or repeated absence from service during the
usual working hours of the Optionee’s position for reason other than disability
or sickness, or refusal to carry out the reasonable directions of the
Corporation’s executive officers or of the Board.


 


8.  Exercise Following Death
or Disability.  If the Optionee’s
service with the Corporation terminates by reason of the Optionee’s death or
disability, or if the Optionee dies after termination of service but while the
Option would have been exercisable hereunder, the Option (to the extent it has
not previously been exercised and is then exercisable in accordance with the
provisions of paragraph 4 above) may be exercised at any time prior to and
including, but not later than the termination date set forth in paragraph 6(a) above.  In the case of death, the exercise may be
made by Optionee’s representative or by the person entitled thereto under
Optionee’s will or the laws of descent and distribution; provided that such
representative or such person consents in writing to abide by and be subject to
the terms of this Agreement and such writing is delivered to the President of
the Corporation.


 


9.  Exercise Following
Retirement.  If the Optionee’s
service with the Corporation terminates by reason of retirement (the voluntary
retirement of employment upon attainment of 65 years of age and completion of
20 years of service), the Option (to the extent it has not previously been
exercised and is then exercisable in accordance with the provisions of
paragraph 4 above) may be exercised at any time prior to and including, but not
later than the termination date set forth in paragraph 6(a) above.


 


10.  Time of Termination of
Service.  For the purposes of this
Agreement, Optionee’s service shall be deemed to have terminated on the earlier
of (a) the date when Optionee’s service in fact terminated or (b) the
date when the Optionee gave or received written notice that his or her service
is to terminate.


 


11.  Nontransferability.  Unless the Corporation otherwise consents in
writing, the option and all rights and privileges granted hereunder shall be
non-assignable and non-transferable by the Optionee, either voluntarily or by
operation of law, except by will or by operation of the laws of descent and
distribution, shall not be pledged or hypothecated in any way, and shall be
exercisable during lifetime only by the Optionee.  Except as otherwise provided herein, any
attempted alienation, assignment, pledge, hypothecation, attachment, execution
or similar process, whether voluntary or involuntary, with respect to all or
any part of the Option or any right thereunder, shall be null and void and, at
the Corporation’s option, shall cause all of Optionee’s rights under this
Agreement to terminate.


 


12.  Effect of Exercise.  Upon exercise of all or any part of the
Option, the number of shares of Stock subject to option under this Agreement
shall be reduced by the number of shares with respect to which such exercise is
made.


 


13.  Method of Exercise.  Each exercise of the Option shall be by means
of a written notice of exercise in substantially the form prescribed from time
to time by the Board delivered to the Secretary of the Corporation at its
principal office and accompanied by payment in full of the option price for
each share of Stock purchased under the Option. 
Such notice shall specify the number of shares of Stock with respect to
which the Option is exercised and shall be signed by the person exercising the
Option.  If the Option is exercised by a
person other than the Optionee, such notice shall be accompanied by proof,
reasonably satisfactory to the Corporation, of such person’s right to exercise
the Option.


 


The Purchase Price specified in paragraph 3 above shall be paid in full
upon the exercise of the Option (i) by cash, 


 





















 


in United States dollars; by the surrender of Shares in good form for
transfer, owned by the person exercising the Option and having a Fair Market
Value on the date of exercise equal to the Purchase Price, or in any
combination of cash and Shares, as long as the sum of the cash so paid and the
Fair Market Value of the Shares so surrendered equal the Purchase Price; (ii) by
cancellation of indebtedness owed by the Corporation to the Optionee; or (iii) by
any combination of the foregoing.


 


14.  Withholding Taxes.  If the Optionee is an employee or former
employee of the Corporation when all or part of the Option is exercised, the
Corporation may require the Optionee to deliver payment of any withholding
taxes (in addition to the Option exercise price) in cash with respect to the
difference between the Option exercise price and the fair market value of the
Stock acquired upon exercise.


 


15.  Issuance of Shares.  Subject to the foregoing conditions, the
Corporation, as soon as reasonably practicable after receipt of a proper notice
of exercise and without transfer or issue tax or other incidental expense to
the person exercising the Option, shall deliver to such person at the principal
office of the Corporation, or such other location as may be acceptable to the
Corporation and such person, one or more certificates for the shares of Stock
with respect to which the option has been exercised.  Such shares shall be fully paid and
nonassessable and shall be issued in the name of such person.  However, at the request of the Optionee, such
shares may be issued in the names of the Optionee and his or her spouse (a) as
joint tenants with right of survivorship, (b) as community property or (c) as
tenants in common without right of survivorship.


 


16.  Limitation of Optionee’s
Rights.  Neither Optionee nor any
person entitled to exercise the Option shall be or have any of the rights of a
stockholder of the Corporation in respect of any share issuable upon the
exercise of the Option unless and until a certificate or certificates representing
shares of Stock shall have been issued and delivered upon exercise of the
Option in full or in part.  No adjustment
shall be made for dividends or other rights for which the record date is prior
to the date such stock certificates are issued.


 


17.  Consent Required to
Transfer.  In connection with any
underwritten public offering by the Corporation of its equity securities
pursuant to an effective registration statement filed under the 1933 Act,
including the Corporation’s initial public offering, Optionee shall not sell,
make any short sale of, loan, hypothecate, pledge, grant any option for the
purchase of, or otherwise dispose or transfer for value or otherwise agree to
engage in any of the foregoing transactions with respect to, any Stock purchased
under the Option without the prior written consent of the Corporation or its
underwriters.  Such limitations shall be
in effect for such period of time from and after the effective date of such
registration statement as may be requested by the Corporation or such
underwriters.


 


18.  Notices.  Any notice to the Corporation contemplated by
this Agreement shall be addressed to it in care of its President; any notice to
the Optionee shall be addressed to him or her at the address on file with the
Corporation on the date hereof or at such other address as Optionee may
hereafter designate in a writing delivered to the Corporation as provided
herein.


 


19.  Interpretation.  The interpretation, construction, performance
and enforcement of this Agreement shall lie within the sole discretion of the
Board, and the Board’s determinations shall be conclusive and binding on all
interested persons.


 


20.  Governing Law.  This Agreement has been made, executed and
delivered in, and the interpretation, performance and enforcement hereof shall
be governed by and construed under the laws of the State of California.


 


IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement, in the case of the Corporation by its duly authorized office, as the
day and year first above written.


 


	
   

  	
  Summa Industries,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Optionee:

  	
   

  	
   

  
	
   

  	
  Social Security No.