Document:

EXHIBIT 10.1

EXHIBIT 10.1

NONQUALIFIED STOCK OPTION AGREEMENT

                    This Agreement is made as of the ___ day of _____, 200_ ("Grant Date") between Gerber Scientific, Inc. (the "Company"), and «Name» (the "Optionee").  This Agreement is made pursuant to the Gerber Scientific, Inc. 2003 Employee Stock Option Plan (the "Plan").  Capitalized terms used herein and not otherwise defined herein shall have the meaning ascribed to them in the Plan.

                    WHEREAS, the Company has adopted the Plan to grant Incentive Stock Options and Nonqualified Options to purchase shares of its common stock ("Common Stock") to key Employees for the purpose of providing such individuals with the opportunity to increase their proprietary interest in the Company under conditions which will encourage their continued employment in the service of the Company or its Subsidiaries;

                    WHEREAS, the Management Development and Compensation Committee of the Board of Directors of the Company (the "Committee"), which is responsible for administering the Plan in accordance with Article 5 of the Plan, has determined that the Optionee is a key Employee with managerial, supervisory, professional, scientific, engineering, or similar responsibilities; and,

                    WHEREAS, the Committee wishes to grant the Optionee a Non-Qualified Option under the Plan pursuant to the terms below.

                    NOW, THEREFORE, in consideration of the premises and of the covenants and agreements herein set forth, the parties hereby mutually covenant and agree as follows: 

                    A.Grant.  Pursuant to the terms of the Plan and on the terms and conditions set forth in this Agreement, the Committee has granted the Optionee a Nonqualified Option (the "Option") to purchase «Shares» shares of the Company's Common Stock at a price of  US$____ per share, which is not less than 100% of the Fair Market Value of the Company's Common Stock on the Grant Date.  

                    B.Events Governing Exercise.  The Option is only exercisable before it expires and then only with respect to the vested portion of the Option.  The Option vests as follows:

One-third of the shares subject to the Option vest on  ____, 200_; 

One-third of the shares subject to the Option vest on  ____, 200_; and

One-third of the shares subject to the Option vest on  ____, 200_.

provided that vesting has not already been accelerated in accordance with this Agreement or the Plan.  No portion of this Option is exercisable later than ______, 20    (the "Expiration Date"), which is ten (10) years from the Grant Date.  To the extent exercisable, this Option may be exercised in whole or in part and, if exercised in part, will not exhaust or terminate this Option as to any remaining shares.  

                    Except as otherwise described herein regarding termination of employment as a result of death, Permanent Disability, or Retirement, this Option may be exercised following the Optionee's termination from employment with the Company, to the extent it was exercisable on the date of such termination, within thirty (30) days of such termination (but in no event later than the Expiration Date).  Notwithstanding the foregoing sentence, if the Optionee's employment is terminated as a result of fraud or other gross misconduct on the part of the Optionee (the existence of which shall be determined by the Committee in its sole discretion), the Option shall terminate on the date of such termination of employment.

                    In the event the Optionee's employment with the Company is terminated as a result of death or Permanent Disability, this Option (or part thereof) shall become immediately exercisable in full and may be exercised within one (1) year following the date of death or Permanent Disability, as the case may be (but in no event later than the Expiration Date).  Under such circumstances, the Option may be exercised by the person designated by the Optionee or, if no designation was made or if termination results from Permanent Disability, by the proper legal representative of the Optionee or, where applicable, by the Optionee.

                    In the event the Optionee's employment with the Company is terminated as a result of Retirement, this Option (or part thereof), to the extent it would be exercisable by the Optionee within two years following the date of Retirement, shall become immediately exercisable and may be exercised by the Optionee within one (1) year following the date of Retirement (but in no event later than the Expiration Date).

                    In the event of the Optionee's death following termination of employment by reason of Retirement or Permanent Disability, this Option may be exercised by the person designated by the Optionee or, if no designation was made, by the proper legal representative of the Optionee, within the one year following the date of death (but in no event later than the Expiration Date). 

                    Except as otherwise permitted by this Agreement or the Plan, Options may be exercised only while the Optionee remains employed by the Company or one of its Subsidiaries.

                    C.Exercise.  Options shall be exercised by (a) written notice to the Committee of the intent to exercise the Option with respect to a specified number of shares of Common Stock and (b) payment for such shares.  Such written notice shall be substantially in the form of Exhibit A attached hereto.  

                    D.Change in Control.  In the event of a Change in Control of the Company, all unexercised outstanding Options (or part thereof) granted as provided in this Agreement shall become immediately exercisable in full and may be exercised at any time on or after the date of such Change in Control, provided such Options are exercised within the exercise periods specified in this Agreement, and provided further that in the case of a Change in Control of the Company by reason of a Business Combination, such Options shall become exercisable in full and may be exercised as of the effective date of such a Business Combination and, if not exercised, shall expire on such date.  Notwithstanding the foregoing, in the event of a Business Combination, the expiration of an unexercised Option as of the effective date of such event shall occur only if the Optionee has received notice by registered or certified mail, return receipt requested, of such proposed event not less than twenty (20) business days in advance of the effective date of the proposed event.  

                    E.Payment.  Payment of the purchase price of shares issued pursuant to the exercise of any portion of any Option shall be in cash or in such other manner as may be permitted by the Plan.  

                    F.Nontransferability.  Except as may be permitted by the Plan, Options may not be transferred other than by will or by the laws of descent and distribution.  Except as may be permitted by the Plan, during the Optionee's lifetime, Options may be exercised only by the Optionee or, if the Optionee is legally incompetent, by the Optionee's guardian or legal representative.  

                    G.Changes in Capital Structure.  If the number of outstanding shares of Common Stock of the Company is changed by reason of a split-up or combination or an exchange of shares or recapitalization or by reason of a stock dividend, merger, consolidation, reorganization, liquidation or the like, the number of shares which are subject to any options granted as provided herein then outstanding and the price per share payable by the Optionee upon exercise shall be adjusted proportionately as determined by the Committee so as to reflect such change.  

                    H.Plan Incorporated by Reference; Interpretations.  Options granted as provided in this Agreement have been granted pursuant to the terms and conditions of the Plan, all of which are incorporated herein by reference.  The Optionee hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms and provisions thereof.  In the event of any conflict between the provisions of the Plan and this Agreement, the provisions of the Plan shall control.  The Committee may interpret the Plan and this Agreement, prescribe, amend, and rescind any rule or regulation necessary or appropriate for the administration of the Plan or this Agreement, and make such other determinations under, and interpretations of, the Plan and the Agreement, and take such other action, as it deems necessary or advisable, except as otherwise expressly reserved in the Plan to the Board of Directors or Shareholders of the Company.  Any interpretation, determination or other action made or taken by the Committee with respect to the terms of this Agreement shall be final, binding and conclusive upon all parties.  All rights under this Agreement shall be governed and construed in accordance with the internal laws (and not the laws relating to conflict of laws) of the State of Connecticut.  

                    I.Withholding.  It shall be a condition of the Company's obligation to issue shares upon exercise of any portion of any Option granted or which may be granted as provided in this Agreement, that the Optionee pay, or make provision satisfactory to the Company for the payment of, any taxes which the Company is obligated to withhold or collect with respect to such exercise or otherwise with respect to such Option.   The Optionee understands that the Company is authorized to pay any such taxes which the Company is obligated to withhold or collect with respect to the exercise of the Option by withholding from the number of shares of Common Stock otherwise issuable upon the exercise of the Option such number of shares that, based on the Fair Market Value of the shares on the date the Option is exercised, will satisfy such taxes.

                    J.No Rights to Continued Employment.  The grant of Options to the Optionee does not confer upon the Optionee any right with respect to continued employment by the Company, nor does this grant interfere in any way with the right of the Company, or the right of the Optionee to terminate the employment of the Optionee at any time.  

                    K.No Rights as Shareholder.  The Optionee shall not have any rights as a shareholder with respect to any shares of Common Stock subject to any Option prior to the date of issuance to the Optionee of a certificate or certificates for such shares.  

                    L.Investment Representation.  If demanded by the Committee, the Optionee (or his beneficiary) shall deliver to the Committee at any time any Option or any portion of any Option is exercised, a representation that the shares to be acquired upon the exercise of the Option are being acquired for investment and not with a view toward resale or with a view to distribution thereof and that the Optionee will comply with such restrictions as may be necessary to satisfy the requirements of United States federal or state securities law or the laws of any other country. This representation shall be a condition precedent to the right of the Optionee to purchase any shares of Common Stock with respect to any such Option.

                    M.Compliance with Laws.  The obligation of the Company to sell and deliver shares hereunder is subject to all applicable United States federal and state laws, rules, and regulations, the laws of any foreign jurisdiction that shall apply to the transactions contemplated hereby, and to such approvals as may be required by any United States or foreign government or regulatory agency.  The Company shall not be required to issue or deliver any certificates for shares of Common Stock under the Plan prior to (a) the obtaining of any approval or ruling from the United States Securities and Exchange Commission, the Internal Revenue Service or any other United States or foreign governmental agency which the Company, in its sole discretion, shall determine to be necessary or advisable, (b) the listing of such shares on any stock exchange on which the Common Stock may then be listed, and (c) the completion of any registration or qualification of such shares under any United States federal or state law or the laws of any other country, or any rule or regulation of any United States or foreign government body which the Company shall, in its sole discretion, determine to be necessary or advisable. 

                    N.Notices.  Any notice hereunder to the Company shall be addressed to it at its office, 83 Gerber Road West, South Windsor, Connecticut 06074, Attention:  Executive Vice President and CFO.  Any notice hereunder to the Committee shall be addressed to it at the Company's office, 83 Gerber Road West, South Windsor, Connecticut 06074, Attention:  Executive Vice President and CFO.  Any notice hereunder to the Optionee shall be addressed to the Optionee at his or her office at the Company or Subsidiary.  Any party shall have the right to designate at any time hereafter in writing some other address for notice.  

                    O.Counterparts.  This Agreement has been executed in two counterparts, each of which shall constitute one and the same instrument.

 

                    IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

GERBER SCIENTIFIC, INC.

 

____________________________________

By:

Name:

Title:

 

____________________________________

«Name»

Optionee

Exhibit A

GERBER SCIENTIFIC, INC.

Management Development and Compensation Committee

83 Gerber Road West

South Windsor, Connecticut  06074

Attn:  Executive Vice President and CFO

Notice of Exercise of Stock Option

Gentlemen:

I hereby exercise the Option granted to me by Gerber Scientific, Inc. (the "Company") as evidenced or provided for in the Nonqualified Stock Option Agreement dated as of ______, 200  , and I hereby notify you of my desire to purchase ________ shares of common stock of the Company ("Common Stock") underlying such Option (the "Option Shares"), which Option is now fully vested and exercisable to the extent of this exercise.

CHECK ONE BELOW

 
____ Enclosed is my check in the sum of US$_____________ in full payment for such Option Shares and all required withholding taxes.

____Enclosed are certificates representing ______ shares of Common Stock owned for at least six months (which are not Restricted Shares) having a fair market value, as of the date of this letter, equal to the purchase price of such Option Shares and all required withholding taxes.

 

____[IF PERMITTED BY APPLICABLE LAW AND APPROVED BY THE COMMITTEE] I have arranged for payment in accordance with a cashless exercise program under which shares of Common Stock may be issued directly to my broker or dealer upon receipt of the purchase price for such shares and all required withholding taxes in cash from my broker or dealer.

 

Dated: ___________________

______________________________

Optionee's SignatureEXHIBIT 10.2

EXHIBIT 10.2

RESTRICTED STOCK AGREEMENT

                   This Agreement is made as of _______ , 200_, ("Grant Date") between GERBER SCIENTIFIC, INC. (the "Company") and  _____________  ("Grantee").  This Agreement is made pursuant to the Gerber Scientific, Inc. 2003 Employee Stock Option Plan (the "Stock Plan").    Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Stock Plan.

                   WHEREAS, the Management Development and Compensation Committee of the Board of Directors of the Company (the "Committee"), which is responsible for administering the Stock Plan in accordance with Article 5 of the Stock Plan, has determined that Grantee be granted Restricted Shares; and

                   WHEREAS, the Committee wishes to increase Grantee's proprietary interest in the Company and encourage Grantee's continued employment with the Company or its Subsidiary.  

                   NOW, THEREFORE, in consideration of the premises and of the covenants and agreements herein set forth, the parties hereby mutually covenant and agree as follows:

                   1.Grant.  Pursuant to the terms of the Stock Plan and this Grant Agreement, the Committee has granted to Grantee ______  shares of the Company's Common Stock (the "Restricted Stock"), which shall be restricted in accordance with this Agreement.

                   2.Restriction Period.  The shares of Restricted Stock granted to Grantee shall be restricted from the Grant Date until they vest (the "Restriction Period") as follows:

One-fourth of the Restricted Shares shall vest on ______

One-fourth of the Restricted Shares shall vest on ______

One-fourth of the Restricted Shares shall vest on ______

One-fourth of the Restricted Shares shall vest on ______

provided that vesting has not already been accelerated in accordance with Section 4 of this Agreement.

                   3.Forfeiture of Restricted Stock During Restriction Period.   Should Grantee cease to be an Employee at any time during the Restriction Period, whether voluntarily or involuntarily, for any reason other than death, Permanent Disability or Retirement, all rights of Grantee to the Restricted Stock granted in accordance with this Agreement shall be forfeited and such Restricted Stock will be automatically reacquired by the Company and Grantee shall have no further interest in such Restricted Stock. 

                   4.Termination of Restrictions in the Event of Death, Permanent Disability, or Retirement of Grantee or in the Event of a Change of Control.  The restrictions on the Restricted Stock granted to Grantee in accordance with this Agreement shall terminate, and the Restricted Stock shall vest in Grantee (i) should Grantee cease to be an employee of the Company due to the death, Permanent Disability or Retirement of Grantee or (ii) upon a Change of Control.

                   5.Rights as Stockholder During the Restriction Period.  During the Restriction Period, Grantee's Restricted Stock shall be held, physically and of record, by the Company or its nominee (at the Company's election Restricted Stock may be held in book entry form) for the benefit of Grantee.  Grantee, as beneficial owner of the Restricted Stock, shall be entitled to any cash dividends paid on the Restricted Stock and shall be entitled to direct the voting of such Restricted Stock.  Shares of Common Stock distributed as a dividend on the Restricted Stock, if any, shall be subject to the same restrictions as those imposed on the Restricted Stock and reflected in this Agreement.

                   6.Nontransferability of Restricted Stock.  The Restricted Stock shall be non-transferable and non-assignable during the Restriction Period.

                   7.Payment of Taxes.  Grantee understands, acknowledges and agrees that the value of the Restricted Stock is subject to state and federal income taxes and certain rules which require the Company to withhold amounts necessary to pay these taxes. Grantee hereby authorizes the Company to reduce the number of shares of Restricted Stock delivered to Grantee at the time the restrictions lapse by the number of shares of Restricted Stock required to satisfy the tax withholding requirements.  Such shares of Restricted Stock shall be returned to the Company. Grantee's acknowledgement and acceptance of these tax withholding provisions are conditions precedent to the right of Grantee to receive the Restricted Stock under the Stock Plan and this Agreement.  

                   8.Acknowledgment of Receipt.  Grantee agrees to acknowledge receipt of the stock certificate or other evidence of ownership for the Restricted Stock upon lapse of the restrictions by delivering to the Company an Acknowledgement of Receipt substantially in the form of Exhibit A to this Agreement, if requested by the Company.  

                   9.Section 83(b) Election.  Under Section 83 of the Internal Revenue Code of 1986, as amended (the "Code"), the difference between the purchase price paid for the shares of Restricted Stock and their Fair Market Value on the date any forfeiture restrictions applicable to such shares lapse will be reportable as ordinary income at that time.  For this purpose, "forfeiture restrictions" include the forfeiture of unvested shares as described above.  Grantee may elect to be taxed at the time the shares are acquired, rather than when such shares cease to be subject to such forfeiture restrictions, by filing an election under Section 83(b) of the Code with the Internal Revenue Service within thirty (30) days after the Grant Date.  Grantee will have to make a tax payment to the extent the amount paid for the shares is less than the Fair Market Value of the shares of Restricted Stock on the Grant Date.  The form for making this election is attached as Exhibit B hereto.  Failure to make this filing within the thirty (30) day period will result in the recognition of ordinary income by Grantee (in the event the Fair Market Value of the shares as of the vesting date exceeds the purchase price) as the forfeiture restrictions lapse.

                   GRANTEE ACKNOWLEDGES THAT IT IS GRANTEE'S SOLE RESPONSIBILITY, AND NOT THE COMPANY'S, TO FILE A TIMELY ELECTION UNDER SECTION 83(b) OF THE CODE, EVEN IF GRANTEE REQUESTS THE COMPANY OR ITS REPRESENTATIVES MAKE THIS FILING ON GRANTEE'S BEHALF.  GRANTEE IS RELYING SOLELY ON GRANTEE'S OWN ADVISORS IN DETERMINING WHETHER TO FILE ANY ELECTION UNDER SECTION 83(b) OF THE CODE.

                    Grantee agrees to give notice to the Company in accordance with Section 14 of this Agreement in the event that Grantee makes a Section 83(b) election.

                   10.Stock Plan Incorporated by Reference; Interpretations.  The shares of Restricted Stock granted hereby are granted pursuant to the terms and conditions of the Stock Plan, all of which are incorporated herein by reference.  Grantee hereby acknowledges receipt of a copy of the Stock Plan and agrees to be bound by all of the terms and provisions thereof.  If there is any conflict between the provisions of the Stock Plan and this Agreement, the provisions of the Stock Plan shall control.  The Committee is responsible for the administration of the Stock Plan and any interpretations, determinations or other actions made or taken by the Committee regarding the operation of the Stock Plan are final, binding and conclusive on the parties hereto.  All rights under this Agreement shall be governed and construed in accordance with the internal laws (and not the laws relating to conflict of laws) of the State of Connecticut.

                   11.No Rights to Continued Employment.  The grant hereby of the Restricted Stock to Grantee does not confer upon Grantee any right with respect to continued employment by the Company, nor does this grant interfere in any way with the right of the Company, or the right of Grantee, to terminate Grantee's employment with the Company at any time.

                   12.Investment Representation.  Grantee represents and warrants that the Common Stock to be acquired hereby is being acquired for investment and not with a view toward resale or with a view to distribution thereof and that Grantee will comply with such restrictions as may be necessary to satisfy the requirements of federal or state securities law.  Upon demand by the Committee, Grantee (or Grantee's beneficiary, guardian, or legal representative) shall deliver to the Committee the representation contained above at the time the restrictions on the Restricted Stock lapse.  The making of this representation is a condition precedent to the right of Grantee to receive Common Stock under this Agreement.

                   13.Compliance with Laws.  The obligation of the Company to deliver Common Stock hereunder is subject to all applicable federal and state laws, rules, and regulations and to such approvals as may be required by any government or regulatory agency.  The Company shall not be required to issue or deliver any certificates or other evidence of ownership for Common Stock granted in accordance with this Agreement prior to (a) the obtaining of any approval or ruling from the Securities and Exchange Commission, the Internal Revenue Service or any other governmental agency which the Company, in its sole discretion, shall determine to be necessary or advisable, (b) the listing of such Common Stock on any stock exchange on which the Common Stock may then be listed, and (c) the completion of any registration or qualification of such Common Stock under any federal or state law, or any rule or regulation of any government body which the Company shall, in its sole discretion, determine to be necessary or advisable.

                   14.Notices.  Any notice hereunder to the Committee or the Company shall be addressed to it at the Company's office, 83 Gerber Road West, South Windsor, Connecticut 06074, Attention: Executive Vice President and CFO.  Any notice hereunder to Grantee shall be addressed to Grantee at his or her office at the Company or Subsidiary.  Any party shall have the right to designate at any time hereafter in writing some other address for notice.

                   15.Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

                   IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

GERBER SCIENTIFIC, INC.

 

 

____________________________________

By:

Name:

Title:

 

GRANTEE

 

____________________________________

Name

EXHIBIT A

 

 

 

ACKNOWLEDGMENT OF RECEIPT

 

 

Receipt is hereby acknowledged of the delivery to me on _________________ of stock certificate(s) for ________ shares of Common Stock of Gerber Scientific, Inc., which shares represent Restricted Stock granted to me by the Company on                    , 200  .  I acknowledge and agree, in accordance with the terms of the Grant Agreement, that the balance of _______ Restricted Stock has been retained by the Company and used to satisfy the tax withholding obligations applicable to the value of the Restricted Stock granted to me.

 

 

___________________________

Name:

 

 

EXHIBIT B

ELECTION UNDER SECTION 83(b) OF

THE INTERNAL REVENUE CODE

The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder:

  1.The name, address and social security number of the undersigned:

  
    Name:

    

    Address:

  

  

  

  Social Security No.:

  

2.Description of property with respect to which the election is being made:

  ____________ shares of common stock of Gerber Scientific, Inc., a Connecticut corporation, (the "Company").

  3.The date on which the property was transferred is _________ ___, 20__.

  4.The taxable year to which this election relates is calendar year 20__.

  5.Nature of restrictions to which the property is subject:

  
    The shares of stock are subject to the provisions of a Restricted Stock Agreement between the undersigned and the Company.  The shares of stock are subject to forfeiture under the terms of the Agreement.

  

  6.The fair market value of the property at the time of transfer (determined without regard to any lapse restriction) was $__________ per share, for a total of $_________.

  7.The amount paid by taxpayer for the property was $___________.

  8.A copy of this statement has been furnished to the Company.

Dated:  ____________, 20__

                      	
                          	____________________

                              Taxpayer's Signature

                        
	 	___________________

  Taxpayer's Printed Name

                       

                       

                      

                        

                      

                      
                      

                      

                      

                      PROCEDURES FOR MAKING ELECTION

                      UNDER INTERNAL REVENUE CODE SECTION 83(b)

                       

                       

                      
                      The following procedures must be followed with respect to the attached form for making an election under Internal Revenue Code section 83(b) in order for the election to be effective:

                  1.You must file one copy of the completed election form with the IRS Service Center where you file your federal income tax returns within 30 days after the Grant Date of your Restricted Stock.

                  2.At the same time you file the election form with the IRS, you must also give a copy of the election form to the Secretary of the Company.

                  3.You must file another copy of the election form with your federal income tax return (generally, Form 1040) for the taxable year in which the stock is transferred to you.

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