Document:

MRV Communications, Inc. - Exhibit 4.2

 

Exhibit 4.2

NON-DIRECTOR AND NON-EXECUTIVE OFFICER

CONSOLIDATED LONG-TERM STOCK INCENTIVE PLAN

AWARD AGREEMENT

     THIS AGREEMENT, entered into «Month_day_granted», «Year_granted» between
MRV Communications, Inc., a Delaware Corporation (the “Company”), and
«First_Name» «Last_Name» (the “Optionee”).

R E C I T A L S

     A.     The Board of Directors of the Company (the “Board”) has established
the Non-Director and Non-Executive Consolidated Long-Term Stock Incentive Plan of MRV
Communications, Inc. (the “Plan”) in order to provide key employees and
consultants of the Company with an opportunity to acquire shares of the
Company’s common stock, par value $0.0017 per share (“Stock”).

     B.     The Board regards the Optionee as a key employee or consultant as
contemplated by the Plan and has determined that it would be in the best
interests of the Company and its stockholders to grant the option described in
this Agreement to the Optionee as compensation, as an inducement to remain in
the service of the Company, and as an incentive for increasing efforts 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 that he or she has received a copy of the
Plan.

     2.     Grant of Option. Pursuant to the Plan, the Company hereby grants to
the Optionee as of the date thereof the option to purchase all or any part of
an aggregate of «Options_granted» shares of Stock (the “Option”), subject to
adjustment in accordance with Section 3(d) of the Plan. The Option is not
intended to qualify as an incentive stock option under Section 422A of the
Internal Revenue Code of 1986, as amended.

     3. Option Price. The price to be paid for Stock upon exercise of the
Option or any part thereof shall be «Exercise_price» per share, which equals or
exceeds the fair market value of the stock as of the date of grant.

 

 

     4.     Right to Exercise. Subject to the conditions set forth in this
Agreement and the Plan the right to exercise the Option shall accrue as
follows, with no portion of the right to exercise accruing on any other date
(e.g. no pro-ration) except as specifically set forth in this Agreement or the
Plan.

	 	 	 
	Date	 	Number of Shares
	
	 	

	«Month_day_granted», 2003	 	
«Options_each_vesting»
	«Month_day_granted», 2004	 	
«Options_each_vesting»
	«Month_day_granted», 2005	 	
«Options_each_vesting»
	«Month_day_granted», 2006	 	
«Options_each_vesting»

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

     6.     Term of Option. The Option shall terminate in any event on the
earliest of (a) the «Month_day_granted», «Year_expires» at 11:59 PM, (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
with the Company terminates for any reason, or no reason, whether voluntarily
or involuntarily, with or without cause, other than death, disability or
retirement, any portion of the Option granted hereunder held by such person
which is not then exercisable shall terminate and any portion of the Option
which is then exercisable may be exercised within thirty (30) consecutive days
after the date of such cessation.

     8.     Exercise Following Death or Disability. If the Optionee’s service with
the Company terminates by reason of the Optionee’s death or disability (as
defined below), the Option (to the extent it has not previously been exercised
and is then exercisable) may be exercised within one year after the date of the
Optionee’s death or termination by reason of disability. In the case of death,
the exercise may be made by his or her representative or by the person entitled
thereto under the Optionee’s will or the laws of descent and distribution,
provided, however, that such representative or such person consents in writing
to abide by and be subject to the terms of the Plan and this Agreement and such
writing is delivered to the President of the Company. For purposes hereof,
“disability” shall mean a medically determinable physical or mental impairment
which has made an individual incapable of engaging in any substantial gainful
activity. A condition shall be considered a disability only if (i) it can be
expected to result in death or has lasted or can be expected to last for a
continuous period of not less than twelve (12) months, and (ii) the Plan
Administrator, based on medical evidence, has expressly determined that a
disability exists.

     9.     Exercise Following Retirement. If the Optionee’s service with the
Company terminates by reason of retirement (as defined below) the Option (to
the extent it has not previously been exercised and is then exercisable) may be
exercised within ninety (90) days after the date of the Optionee’s retirement.
For purposes hereof, “retirement” shall mean the voluntary

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 cessation of employment by an individual upon the attainment of age
sixty-five (65) and the completion of not less than twenty (20) years of
service with the Company or a subsidiary.

     10.     Nontransferability. The Option shall be exercisable during the
Optionee’s lifetime only by the Optionee or the Optionee’s guardian or legal
representative and shall be nontransferable, except that the Optionee may
transfer all or any part of the Option by will or by the laws of descent and
distribution. 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 Company’s option,
shall cause all of the Optionee’s rights under this Agreement to terminate.

     11.     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.

     12.     Exercise of Option. The Option may be exercised by delivering to the
Company (a) a written notice of exercise in substantially the form prescribed
from time to time by the Plan Administrator and (b) full payment 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, satisfactory to the Company, of such person’s right to
exercise the Option. The Option price shall be payable in U.S. dollars.

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

     14.     Issuance of Shares. Subject to the foregoing conditions, the Company,
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 executive
office of the Company, or such other location as may be acceptable to the
Company and such person, one or more certificates for the shares of Stock with
respect to which the Option is 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 as (a) joint tenants with right of survivorship, (b)
community property, or (c) tenants in common without right of survivorship.

     15.     Rights as a Stockholder. Neither the Optionee nor any other person
entitled to exercise the Option shall have any rights as a stockholder of the
Company with respect to the stock subject to the Option until a certificate for
such shares has been issued to him or her upon exercise of the Option.

     16. Notices. Any notice to the Company contemplated by this Agreement
shall be addressed to it in care of its President; and any notice to the
Optionee shall be addressed to him or her at the address on file with the
Company on the date hereof or at such other address as he or she may hereafter
designate in writing.

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     17.     Not a Contract of Employment. By executing this Agreement, if the
Optionee is an employee of the Company, Optionee acknowledges and agrees that:

          a. a person whose employment is terminated before full vesting of an
award, such as the one granted by this Agreement, could attempt to argue that
he or she was terminated to preclude vesting of the award;

          b. Optionee promises never to make such a claim;

          c. nothing in this Agreement gives Optionee the right to remain in the
employ of the Company or any subsidiary or to affect the absolute and
unqualified right of the Company and any of its subsidiaries to terminate
Optionee’s employment at any time for any reason or no reason and with or
without cause or prior notice;

          d. except to the extent explicitly provided otherwise in a then effective
written employment contract executed by Optionee and the Company, Optionee is
an at will employee whose employment may be terminated without liability at any
time for any reason; and

          e. the Company would not have granted this award to Optionee but for these
acknowledgements and agreements.

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

     19. Choice of Law. This Agreement shall be governed by and construed in
accordance with the internal substantive laws (not the law of choice of laws)
of the State of California. Any dispute or disagreement regarding the
Optionee’s rights under this Agreement shall be settled soley by binding
arbitration in accordance with the applicable rules of the American Arbitration
Association.

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

	 	 	 	 	 
	 	 	
MRV COMMUNICATIONS, INC.,

a Delaware corporation
 	 	 
	 	 	
By:	 	 
	
	 	 	 	

	«First_Name» «Last_Name»	 	 	 	Noam Lotan

President and Chief Executive Officer
	Optionee’s Spouse*
«Spouse_full_name»	 	 	 	 

Optionee’s State of residence: «State_of_residence»

*Include signature and name of Optionee’s spouse if Optionee is married.

4<PAGE>

                                                                    Exhibit 4(d)

                                 AMENDMENT NO. 1
                                       TO
                          THE LINCOLN ELECTRIC COMPANY
                              EMPLOYEE SAVINGS PLAN
                          (EFFECTIVE NOVEMBER 1, 1994)

                  The Lincoln Electric Company, an Ohio corporation, hereby
adopts this Amendment No. 1 to The Lincoln Electric Company Employee Savings
Plan (Effective November 1, 1994). The provisions of this Amendment shall be
effective as of November 1, 1994.

                                       I.

                  Section 1.1(22) and Section 3.5(1) of the Plan are hereby
amended by deleting the reference to "section 402(a)(8)" and substituting
therefor "section 402(e)(3)".

                                       II.

                  Section 1.1(27) of the Plan is hereby amended in its entirety
to read as follows:

         "(27) Enrollment Date: November 16, 1994, the first day of each
         January, April, July and October thereafter, and the Wednesday
         immediately preceding each Thanksgiving Day after 1994."

                                      III.

                  Section 1.1(31)(a) of the Plan is hereby amended by deleting
the words "Unless the Company elects one of the simplified methods contained in
section 414(q)(12) of the Code or Revenue Procedure 93-42," and substituting
therefor the following:

         "Unless the Company elects one of the simplified methods contained in
         section 414(q)(12) of the Code or Section 4 of Revenue Procedure 93-42
         (including, if elected, the use of a 'snapshot day' as provided in such
         Procedure) the provisions of which are hereby incorporated by
         reference,"

                                       IV.

                  Section 6.6(2) of the Plan is hereby amended in its entirety
to read as follows:

                  "(2)(a)  To the extent required under the Code, distributions
         under the Plan shall be made in a manner which satisfies section
         401(a)(9) of the Code and Treasury Regulations issued thereunder
         (including the incidental death benefit requirement of Prop. Treas.
         Reg. Section 1.401(a)(9)(2), which provisions and Regulations are
         incorporated into the Plan by reference; provided, however, that such
         provisions of the Code and Regulations shall override the other

<PAGE>

         distribution provisions of the Plan only to the extent that such other
         Plan provisions provide for distribution that is less rapid than
         required under the provisions of the Code and Regulations. Nothing
         contained in this Section shall be construed as providing any optional
         forms of payment that are not available under the other distribution
         provisions of the Plan.

                  (b)      To the extent required by section 401(a)(9) of the
         Code, the Vested Interest of a Member who has not commenced receiving a
         distribution under the Plan shall commence to be distributed to such
         Member not later than April 1 of the calendar year following the
         calendar year in which he attains age 70 1/2.

                  (c)      The Vested Interest of a Member described in
         paragraph (b) of this Subsection shall be distributed in the manner
         described in Section 6.3 (as if the Member has incurred an Employment
         Severance, whether or not the Member has in fact incurred an Employment
         Severance), provided that the amount distributed in any year shall not
         be less than the amount required to be distributed under section
         401(a)(9) of the Code and the Regulations issued thereunder. For
         purposes of determining the amount to be distributed in any year
         pursuant to this paragraph, a Member's Vested Interest shall be based
         on the value of the Member's Account on the Valuation Date immediately
         preceding the date of the distribution.

                  (d)      If distributions to a Member have commenced and the
         Member dies before his entire Vested Interest has been distributed to
         him, the remaining portion of such Interest shall be distributed at
         least as rapidly as under the method of distribution being used as of
         the date of the Member's death.

                  (e)      If a Member dies before the distribution of his
         Vested Interest has commenced, his Vested Interest shall be distributed
         as provided in Section 6.2 or 6.4, as applicable."

                  EXECUTED at Cleveland, Ohio, this 16th day of December, 1994.

                                        THE LINCOLN ELECTRIC COMPANY

                                        By /s/ H. Jay Elliot
                                           -----------------------------
                                           Title: Vice President, CFO
                                                  Treasurer and Acting Secretary

                                        And ____________________________
                                            Title:

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