Exhibit 10.4


 


ROLLER BEARING HOLDING COMPANY, INC.


 


AMENDED AND RESTATED 2001 STOCK OPTION PLAN


 


1.             Purpose.  The Roller Bearing Holding Company, Inc.
Amended and Restated 2001 Stock Option Plan (the “Plan”) is intended to provide
incentives which will attract and retain highly competent persons as officers
and management-level employees of Roller Bearing Holding Company, Inc. and
its subsidiaries (the “Company”), as well as independent contractors providing
consulting or advisory services to the Company, by providing them opportunities
to acquire shares of Class A Common Stock of the Company (“Common Shares”)
pursuant to Options, as described herein.


 


2.             Administration.


 


(a)           Subject to its
express terms, the Plan will be administered by the Board of Directors of the
Company (the “Board”) unless and until the Board delegates, or is required to
delegate, administration pursuant to the terms of the Plan.  The Board is authorized, subject to the
provisions of the Plan, to establish such rules and regulations as it
deems necessary or appropriate for the proper administration of the Plan and to
make such determinations and interpretations and to take such action in
connection with the Plan and any Options granted hereunder as it deems
necessary or advisable.  All determinations
and interpretations made by the Board shall be binding and conclusive on all
participants and their legal representatives. 
No member of the Board, and no employee of the Company shall be liable
for any act or failure to act hereunder, by any other member or employee or by
any agent to whom duties in connection with the administration of this Plan
have been delegated or, except in circumstances involving his bad faith, gross
negligence or fraud, for any act or failure to act by the member or employee.


 


(b)           The Board may
delegate all or any portion of its administration of the Plan to a committee
composed of not fewer than two (2) members of the Board (the “Committee”).  If administration is delegated to a
Committee, the Committee shall have, in connection with the administration of
the Plan, the powers theretofore possessed by the Board (and references in this
Plan to the Board shall thereafter be to the Committee, as applicable),
subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board.  The Board may terminate all or any portion of
the Committee’s authority under the Plan at any time and revest in the Board
all or any portion of the administration of the Plan.


 


3.             Participants.  Participants will consist of such officers
and management-level employees of the Company, and independent contractors
providing consulting or advisory services to the Company (including members of
the Board), as the Chief Executive Officer of the Company (the “CEO”), in his
sole discretion, determines to be significantly responsible for the success and
future growth and profitability of the Company and whom the CEO may designate
from time to time to receive Options under the Plan (including, without
limitation, the CEO himself). 
Designation as a participant in any year shall not require the CEO to
designate such person to receive an Option in any other year or, once designated,
to receive the same type or


 





















 


amount of Options as granted to the participant, or any other
participant, in any year.  The CEO shall
consider such factors as he deems pertinent in selecting participants and in
determining the type and amount of their respective Options.


 


4.             Shares Reserved under the Plan.  Subject to adjustments as provided in Section 6,
there is hereby reserved for issuance under the Plan an aggregate of 403,421
Common Shares, which may be authorized but unissued shares or shares held by
the Company in its treasury.  Any shares
subject to any form of Option hereunder may thereafter be subject to new
Options under this Plan if there is a lapse, expiration or termination of any
such Options granted prior to issuance of the shares, or if shares are issued
under Options and thereafter are reacquired by the Company pursuant to rights
reserved by the Company upon issuance thereof.


 


5.             Options.  Options will consist of awards from the
Company that will enable the holder to purchase a specific number of Common
Shares, at set terms and at a fixed purchase price.  Options may be “incentive stock options”
within the meaning of Section 422 of the Internal Revenue Code (“Incentive
Stock Options”) or Options that do not constitute Incentive Stock Options (“Nonqualified
Stock Options,” and together with Incentive Stock Options, “Options”).  The CEO will have the authority to grant to
any participant one or more Incentive Stock Options, Nonqualified Stock
Options, or both types of Options.  Each
Option shall be evidenced by a written option agreement in such form and shall
be subject to such terms and conditions as the CEO may approve from time to
time, including without limitation the following:


 


(a)           Exercise Price.  Each Option granted hereunder shall have such
per-share exercise price as the CEO may determine at the date of grant;
provided, however, that the per share exercise price for the Options shall not
be less than 100% of the Fair Market Value of the Common Shares on the date the
option is granted, as reasonably determined by the Board, except that Options
to acquire 1200 shares of Common Stock at a price per share of $8.00 may be
granted to each of Richard R. Crowell, Kurt B. Larsen, Robert Anderson and
William P. Killian.


 


(b)           Payment of Exercise Price.  The option exercise price may be paid by
check or, in the discretion of the Board, by the delivery (or certification of
ownership) of Common Shares of the Company then owned by the participant;
provided, however, that payment of the exercise price by delivery of Common
Shares of the Company then owned by the participant may be made only if such
payment does not result in a charge to earnings for financial accounting
purposes as determined by the Board.  In
the discretion of the Board, if Common Shares are readily tradeable on a
national securities exchange or other market system at the time of option
exercise, payment may also be made by delivering a properly executed exercise
notice to the Company together with a copy of irrevocable instructions to a
broker to deliver promptly to the Company the amount of sale or loan proceeds
to pay the exercise price.  To facilitate
the foregoing, the Company may enter into agreements for coordinated procedures
with one or more brokerage firms.


 


(c)           Exercise Period.  Options granted under the Plan shall be
exercisable at such times and subject to such terms and conditions as shall be
determined by the CEO; provided, however, that Options shall not be exercisable
more than 10 years after the date they


 


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are granted. 
All Options shall terminate at such earlier times and upon such
conditions or circumstances as the CEO shall in his sole discretion set forth
in such option at the date of grant, including but not limited to limitations
on exercisability following termination of the participant’s employment or
consulting relationship.


 


(d)           Limitations on Incentive Stock
Options.  Incentive
Stock Options may be granted only to participants who are employees of the
Company or one of its subsidiaries (within the meaning of Section 424(f) of
the Internal Revenue Code) at the date of grant.  The aggregate Fair Market Value (determined
as of the time the option is granted) of the Common Shares with respect to
which Incentive Stock Options are exercisable for the first time by a
participant during any calendar year (under all option plans of the Company)
shall not exceed $100,000.  Incentive
Stock Options may not be granted to any participant who, at the time of grant,
owns stock possessing (after the application of the attribution rules of Section 424(d) of
the Code) more than 10% of the total combined voting power of all classes of
stock of the Company, unless the option price is fixed at not less than 110% of
the Fair Market Value of the Common Shares on the date of grant and the
exercise of such option is prohibited by its terms after the expiration of five
years from the date of grant of such option.


 


(e)           Redesignation as Nonqualified
Stock Options. 
Options designated as Incentive Stock Options that fail to meet the
requirements of Section 422 of the Internal Revenue Code shall be
redesignated as nonqualified options for Federal income tax purposes
automatically without further action by the Board or the CEO on the date of
such failure to continue to meet the requirements of Section 422 of the
Code.


 


(f)            Limitation of Rights in Shares.  The recipient of an Option shall not be
deemed for any purpose to be a shareholder of the Company with respect to any
of the shares subject thereto except to the extent that the Option shall have
been exercised and, in addition, a certificate shall have been issued and
delivered to the participant.


 


6.             Adjustment Provisions.


 


(a)           If the Company
shall at any time change the number of issued Common Shares without new
consideration to the Company by stock dividend, stock split, recapitalization,
reorganization, exchange of shares, liquidation, combination or other change in
corporate structure affecting the Common Shares, the total number of shares
available for Options under this Plan shall be appropriately adjusted and the
number of shares covered by each outstanding Option and the exercise price
thereunder shall be adjusted so that the net value of such Option shall not be
changed, all of the foregoing, including the appropriations of any such
adjustment to be as determined by the Board, in its discretion.  It is specifically understood that the
provisions of this subsection (a) are intended to apply solely to
capital events that are independent of, and unrelated to, any transaction
involving the direct or indirect sale or issuance of securities of the Company
for value (and irrespective of the adequacy of the consideration so paid).


 


(b)           In the case of any
sale of assets, merger, consolidation, combination or other corporate
reorganization or restructuring of the Company with or into another corporation


 


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which results in the outstanding Common Shares being
converted into or exchanged for different securities, cash or other property,
or any combination thereof (an “Acquisition”), subject to the provisions of
this Plan and any limitation applicable to the Option, any participant to whom
an Option has been granted shall have the right thereafter and during the term
of the Option, to receive upon exercise thereof the Acquisition Consideration
(as defined below) receivable upon the Acquisition by a holder of the number of
Common Shares that might have been obtained upon exercise of the Option or
portion thereof, as the case may be, immediately prior to the Acquisition.  The term “Acquisition Consideration” shall
mean the kind and amount of securities, cash or other property or any
combination thereof receivable in respect of one Common Share upon consummation
of an Acquisition.


 


(c)           Notwithstanding any
other provision of this Plan, the Board may authorize the issuance,
continuation or assumption of Options or provide for other equitable
adjustments after changes in the Common Shares resulting from any other merger,
consolidation, sale of assets, acquisition of property or stock,
recapitalization, reorganization or similar occurrence upon such terms and
conditions as it may deem equitable and appropriate.


 


(d)           In the event that
another corporation or business entity is being acquired by the Company, and
the Company assumes outstanding employee stock options and/or the obligation to
make future grants of options to employees of the acquired entity, the
aggregate number of Common Shares available for Options under this Plan shall
be increased accordingly.


 


7.             Nontransferability.


 


(a)           Each Option granted
under the Plan to a participant shall not be transferable by him otherwise than
by will or the laws of descent and distribution, and shall be exercisable,
during the participant’s lifetime, only by him. 
In the event of the death of a participant while the participant is
rendering employment, consulting or advisory services to the Company, each
Option theretofore granted to him shall be exercisable during such period after
his death as the Board shall in its discretion set forth in such option at the
date of grant (but not beyond the stated duration of the option) and then only:


 


(i)                                    By
the executor or administrator of the estate of the deceased participant or the
person or persons to whom the deceased participant’s rights under the Option
shall pass by will or the laws of descent and distribution; and


 


(ii)                                To
the extent that the deceased participant was entitled to do so at the date of
his death.


 


(b)           Notwithstanding Section 7(a),
Nonqualified Stock Options granted hereunder may be transferred to members of
the participant’s immediate family (which for purposes of this Plan shall be
limited to the participant’s children, grandchildren and spouse), or to one or
more trusts for the benefit of such family members, or to partnerships or
limited liability companies in which such family members and/or trusts are the
only partners or members, but only if the Option expressly so provides, or as
otherwise approved by the CEO or the Board in their discretion.


 


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8.             Other Provisions.  Options granted under the Plan may also be
subject to such other provisions (whether or not applicable to any other
Options awarded under the Plan to the participant or to any other participant)
as the Board or the CEO determines appropriate, including without limitation,
provisions for the installment purchase of Common Shares, provisions to assist
the participant in financing the acquisition of Common Shares, provisions for
the forfeiture of, or restrictions on resale or other disposition of, Common
Shares acquired under any form of Option, provisions for the deferral of option
gains, provisions for the acceleration of exercisability or vesting of Options
in the event of a change of control of the Company, provisions for the payment
of the value of Options to participants in the event of a change of control of
the Company, provisions for the forfeiture of the Options, or provisions to
comply with Federal and state securities laws, or understandings or conditions
as to the participant’s employment in addition to those specifically provided
for under the Plan.


 


9.             Fair Market Value.  For purposes of this Plan and any Options
awarded hereunder, the Fair Market Value of Common Shares shall be the mean
between the highest and lowest sale prices for the Company’s Common Shares as
reported on the Nasdaq National Market (or such other consolidated transaction
reporting system on which such Common Shares are primarily traded) on the date
of calculation (or on the next preceding trading date if Common Shares were not
traded on the date of calculation); provided, however, that if the Company’s
Common Shares are not at any time readily tradeable on a national securities
exchange or other market system, Fair Market Value shall mean the amount
determined in good faith by the Board as the fair market value of the Common
Shares of the Company.


 


10.          Withholding.  All payments or distributions made pursuant
to the Plan shall be net of any amounts required to be withheld pursuant to
applicable federal, state and local income and/or employment tax withholding
requirements.  If the Company proposes or
is required to distribute Common Shares pursuant to the exercise of Options, it
may require the recipient to remit to it an amount sufficient to satisfy such
tax withholding requirements prior to the delivery of any certificates for such
Common Shares.  The Board may, in its
discretion and subject to such rules as it may adopt, permit an optionee
to pay all or a portion of the federal, state and local withholding taxes
arising in connection with the exercise of an Option, by electing to have the
Company withhold Common Shares having a Fair Market Value that is not in excess
of the amount of taxes required to be withheld.


 


11.          Tenure.  A participant’s right, if any, to continue to
serve the Company as an officer, employee, consultant, advisor, or otherwise,
shall not be enlarged or otherwise affected by his designation as a participant
under the Plan, nor shall this Plan in any way interfere with the right of the
Company, subject to the terms of any separate agreement to the contrary, at any
time to terminate such employment, consulting or advisory relationship, or to
increase or decrease the compensation of the participant from the rate in
existence at the time of the grant of an Option.


 


12.          Duration, Amendment and Termination.  No Option shall be granted after July 31,
2011; provided, however, that the terms and conditions applicable to any Option
granted prior to such date may thereafter be amended or modified by mutual
agreement between the Company and the participant or such other persons as may
then have an interest therein.


 


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Also, by mutual agreement between the Company and a
participant hereunder, under this Plan or under any other present or future
plan of the Company, Options may be granted to such participant in substitution
and exchange for, and in cancellation of, any Options previously granted such
participant under this Plan, or any other present or future plan of the
Company.  The Board may amend the Plan
from time to time or terminate the Plan at any time, subject to any requirement
of stockholder approval required by applicable law, rule or
regulation.  However, no action
authorized by this Section 12 shall reduce the amount of any outstanding
Option or change the terms or conditions thereof without the participant’s
consent.


 


13.          Governing Law.  This Plan and actions taken in connection
herewith shall be governed and construed in accordance with the laws of the
State of Delaware (regardless of the law that might otherwise govern under
applicable Delaware principles of conflict of laws).


 


14.          Approval.  The Plan was adopted by the Board on October 24,
2003.


 


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