Exhibit 10.3



 





Exhibit 10.3




A. Schulman, Inc. 2002 Equity Incentive Plan

Stock Option Award Agreement


Congratulations on your selection as a Participant in the A. Schulman, Inc.
2002 Equity Incentive Plan (the “Plan”). This Award Agreement is between you,
as the undersigned Participant in the Plan, and A. Schulman, Inc., a Delaware
corporation (the “Company”). This Award Agreement and the Plan together govern
your rights under the Plan and set forth all of the conditions and limitations
affecting such rights. A copy of the Plan is attached to this Award Agreement.



Capitalized terms used in this Award Agreement shall have the meanings ascribed
to them in the Plan or in this Award Agreement. If there is any inconsistency
between the terms of this Award Agreement and the terms of the Plan, the Plan’s
terms shall supersede and replace the conflicting terms of this Award
Agreement.



The Options granted to you under this Award Agreement are Nonqualified Stock
Options (“Options”).




Overview of Your Stock Options





	1.	 	Number of Shares Covered by this Option:                                       
	 
	2.	 	Option Price: $          per share
	 
	3.	 	Date of Grant:                                                                                                 (“Date of
Grant”).
	 
	4.	 	Option Term: The Options have been granted for a period of ten (10)
years from the Date of Grant (“Option Term”).
	 
	5.	 	Vesting Period: The Options do not provide you with any rights or
interests therein until they vest in accordance with the following
schedule:






	(a)	 	Thirty-three percent (33%) of the aggregate number of Shares
specified above in Paragraph 1 of this Award Agreement (rounded to a
whole Share) will vest on each of the first, second, and third
anniversaries of the Date of Grant, provided you have continued as a
Director of the Company through such anniversary or anniversaries.
Notwithstanding anything in the preceding sentence to the contrary, on
the third anniversary of the Date of Grant, one-hundred percent (100%)
of the Options shall be vested, again provided you have continued as a
Director of the Company on such anniversary.
	 
	(b)	 	One hundred percent (100%) of the unvested Options will vest upon
your termination as a Director due to death or Disability, provided you
have continued as a Director of the Company through such event.
	 
	(c)	 	If you retire as a Director on or after attaining the age of
sixty-five (65), one hundred percent (100%) of the unvested Options
will vest upon your termination as a Director due to such retirement,
provided you have continued as a Director of the Company through such
event.




[Director Form]


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	6.	 	Exercise: You, or your representative upon your death or incapacity, may
exercise vested Options at any time prior to the termination of the Options
subject to Paragraphs 8 and 9 of this Award Agreement.
	 
	7.	 	How to Exercise: The Options hereby granted shall be exercised by
written notice to Marilyn Shriner at the Company’s executive offices, 3550
West Market Street, Akron, Ohio 44333, or such other administrator,
specifying the number of Shares you then desire to purchase, together with
a check payable to the order of the Company for an amount in United States
dollars equal to the Option Price of such Shares or, delivery (or
certification of ownership) of nonforfeitable, unrestricted Shares (that
have been held by you for at least six (6) months prior to delivery (or
certification of ownership) or that have been purchased in the open
market) having an aggregate Fair Market Value (as of the date of exercise)
equal to such Option Price, or a combination of cash and such Shares. The
requirement of paying the Option Price in cash shall be deemed satisfied
if you make arrangements that are satisfactory to the Company with a
broker that is a member of the National Association of Securities Dealers,
Inc. to sell on the exercise date a sufficient number of Shares that are
being purchased pursuant to the exercise, so that the net proceeds of the
sale transaction will at least equal the amount of the aggregate Option
Price and pursuant to which the broker undertakes to deliver to the
Company the amount of the aggregate Option Price on a date satisfactory to
the Company, but not later than the date on which the sale transaction
will settle in the ordinary course of business. The date of the Company’s
receipt of your written notice shall be the date of exercise.
	 
	 	 	As soon as practicable after receipt of such written notification and
payment of the Option Price, the Company shall issue or transfer to you, the
number of Shares with respect to which such Options shall be so exercised
and not sold. However, if the Option Price is satisfied by certification of
previously acquired Shares, the Company shall issue or transfer to you a
number of Shares equal to the number of Shares with respect to which the
Options are exercised less the number to which you have certified ownership.
Upon receipt of the Option Price, the Company shall deliver to you evidence
of book entry Shares or, upon your request, Share certificates in an
appropriate amount based upon the number of Shares purchased under the
Option.
	 
	8.	 	Termination of Options: The Options, which become exercisable as
provided in Paragraphs 5 and 9 of this Award Agreement, shall terminate
and be of no force or effect as follows:






	(a)	 	If your position as a Director terminates during the Option Term by
reason of death, the Options terminate and have no force or effect, and
your ability to exercise vested Options will expire, upon the earlier
of: (i) twenty-four (24) months after the date of death, or (ii) the
expiration of the Option Term;
	 
	(b)	 	If your position as a Director terminates during the Option Term by
reason of Disability, the Options terminate and have no force or
effect, and your ability to exercise vested Options will expire, upon
the earlier of: (i) twenty-four (24) months after your termination as
a Director of the Company, or (ii) the expiration of the Option Term;
	 
	(c)	 	If your position as a Director terminates during the Option Term by
reason of your retirement as contemplated by Paragraph 5(c) of this
Award Agreement, the Options terminate and have no force or effect, and
your ability to exercise vested Options will expire, upon the earlier
of: (i) twenty-four (24) months after your termination as a Director
of the Company, or (ii) the expiration of the Option Term;




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	(d)	 	Subject to your rights under Paragraph 9 of this Award Agreement,
if your position as a Director terminates during the Option Term for
any other reason, the vesting of your Options will terminate
immediately and the Options will terminate and have no force or effect,
and your ability to exercise vested Options will expire, upon the
earlier of: (i) ninety (90) days after your termination as a Director
of the Company, or (ii) the expiration of the Option Term; and
	 
	(e)	 	If you continue as a Director of the Company through the Option
Term, the Options terminate and have no force or effect, and your
ability to exercise vested Options will expire, upon the expiration of
the Option Term.






	9.	 	Change in Control: In the event of a Change in Control, all of the
unvested Options shall become immediately vested and exercisable. If your
service as a Director of the Company is terminated for reasons other than
death, Disability, or Retirement within ninety (90) days prior to a Change
in Control or within twelve (12) months following a Change in Control, the
Options terminate and have no force or effect, and your ability to
exercise vested Options will expire, upon the earlier of: (i) twenty-four
(24) months after your termination as a Director of the Company, or (ii)
the expiration of the Option Term.
	 
	10.	 	Who Can Exercise: During your lifetime, the Options shall be exercisable
only by you, or, in the event of your legal incapacity, by your guardian
or legal representative acting on your behalf in a fiduciary capacity
under state or foreign law and court supervision. No assignment or
transfer of the Options, whether voluntary or involuntary, by operation of
law or otherwise, except by will or the laws of descent and distribution
or as otherwise required by applicable law, shall vest in the assignee or
transferee any interest whatsoever. Upon your death, your estate (or the
beneficiary that receives the Options under your will) may exercise vested
Options.
	 
	11.	 	Requirements of Law: The granting of Options and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies, national
securities exchanges or automated quotation systems as may be required.
You will take all steps necessary to comply with all applicable federal
and state securities laws in exercising your rights under this Award
Agreement.
	 
	12.	 	Applicable Laws and Consent to Jurisdiction: The validity, construction,
interpretation, and enforceability of this Award Agreement shall be
determined and governed by the laws of the State of Ohio without giving
effect to the principles of conflicts of law. For the purpose of
litigating any dispute that arises under this Award Agreement, the parties
hereby consent to exclusive jurisdiction, and agree that such litigation
shall be conducted, in the federal or state courts of the State of Ohio.
	 
	13.	 	Nontransferability: Options awarded pursuant to this Award Agreement may
not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated (“Transfer”), other than by will or by the laws of descent
and distribution, except as provided in the Plan. If any Transfer,
whether voluntary or involuntary, of the Options is made, or if any
attachment, execution, garnishment, or lien shall be issued against or
placed upon the Options, your right to such Options shall be immediately
forfeited to the Company, and this Award Agreement shall lapse.
	 
	14.	 	Administration: This Award Agreement and your rights hereunder are
subject to all the terms and conditions of the Plan, as the same may be
amended from time to time, as well as to such




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	 	 	rules and regulations as the Committee may adopt for administration of the
Plan. It is expressly understood that the Committee is authorized to
administer, construe, and make all determinations necessary or appropriate
to the administration of the Plan and this Award Agreement, all of which
shall be binding upon you, the Participant.
	 
	15.	 	Amendment to the Plan: Subject to certain limitations, the Committee may
terminate, amend, or modify the Plan; provided, however, that no such
termination, amendment, or modification of the Plan may in any way
adversely affect your rights under this Award Agreement, without your
written approval.
	 
	16.	 	Successor: All obligations of the Company under the Plan and this Award
Agreement, with respect to the Options, shall be binding on any successor
to the Company, whether the existence of such successor is the result of a
direct or indirect purchase, merger, consolidation, or otherwise, of all
or substantially all of the business and/or assets of the Company. In the
event such successor does not agree to be bound by this Award Agreement,
this Option shall become immediately exercisable in full and shall remain
so for a period of ninety (90) days or, if sooner, until the expiration of
the Option Term.
	 
	17.	 	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.
	 
	18.	 	Additional Information: Please refer any questions you may have
regarding your Options to Marilyn Shriner at the Company’s executive
offices, 3550 West Market Street, Akron, Ohio 44333, or such other
administrator as designated from time to time by the Company.
	 
	19.	 	Acknowledgement: By executing this Award Agreement below, you will be
agreeing to participate in the Plan and abide by all of the governing
terms and provisions of the Plan and this Award Agreement. By agreeing to
participate, you acknowledge that you have reviewed the Plan and this
Award Agreement, and fully understand all of your rights under the Plan
and this Award Agreement, and the Company’s remedies if you violate the
terms of this Award Agreement, as well as, all of the terms and conditions
that may limit your eligibility to retain and receive the Options and/or
Shares issued pursuant to the Plan and this Award Agreement.





	 	 	 
	                                      , 20         

	 	A. SCHULMAN, INC.
	 
	 	 
	

	 	By:


	 
	 	 
	

	 	Its:









Acknowledged and Agreed to this          , day of                                       , 20         




	 	 	 
	 

	 	

	

	 	PARTICIPANT








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