NONQUALIFIED STOCK OPTION AGREEMENT
under the
NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
of
ARROW ELECTRONICS, INC.
Date of Grant:
Option for 15,000 Shares
THIS AGREEMENT, dated as of __________________, between
ARROW ELECTRONICS, INC. (the "Company") and ________________ (the
"Optionee") is entered into under the terms of the Arrow
Electronics, Inc. Non-Employee Directors Stock Option Plan (the
"Plan") and shall be construed in accordance with the provisions
of the Plan (which are incorporated herein by reference). The
terms of the Plan shall govern in the event of any inconsistency
with the terms of this Option Agreement. Except as otherwise
expressly set forth herein, the capitalized terms used in this
Option Agreement shall have the meanings set forth in the Plan.
1. Grant of Option. The Company hereby grants to
Optionee the option (the "Option") to purchase from the Company,
all or any part of an aggregate of 15,000 shares of common stock,
par value $1.00 per share, of the Company ("Shares"), at the
purchase price of $32.25 per share (the "Exercise Price").
2. Terms and Conditions of the Option.
(a) Expiration Date. The Option will terminate and
expire, to the extent not previously exercised, on the tenth
(10th) anniversary of the Date of Grant (the "Expiration Date"),
or at such earlier time as may be specified herein.
(b) Exercise of Option. The Option shall become
exercisable with respect to 25% of the Shares subject thereto
effective as of each of the first, second, third, and fourth
anniversaries of the grant date; provided, that the Optionee
continues to serve on the Board as of such dates.
Notwithstanding the foregoing, the Option shall become fully
(100%) exercisable in the event of the Optionee's Retirement,
Disability, Qualifying Termination or death, or upon the earlier
occurrence of a Corporate Event, as provided under the Plan
(c) Manner of Exercise. The Option may be exercised
in whole or in part from time to time during the applicable
exercise period by giving written notice of exercise to the
Secretary of the Company specifying the number of Shares to be
purchased. Notice of exercise must be accompanied by payment in
full of the purchase price either by cash or check or (if
permitted by the Company) in Shares owned by the Optionee having
a Fair Market Value at the date of exercise equal to such
purchase price, or in a combination of the foregoing.
3. Non-Transferability. The Option is not assignable
or transferable otherwise than by will or by the laws of descent
and distribution. During the lifetime of the Optionee, the
Option may be exercised only by the Optionee.
4. Effect of Termination of Board Service. The
exercise periods that apply to the Option upon termination of the
Optionee's service on the Board are set forth below.
(a) If the Optionee's service on the Board terminates
for any reason other than Cause, Retirement, Disability or death,
the Optionee may for a period of ninety (90) days after such
termination exercise the Option to the extent, and only to the
extent, that the Option or portion thereof has become vested and
exercisable, after which time the Option shall automatically
terminate in full.
(b) If the Optionee's service on the Board terminates
for Cause, the Option shall immediately terminate in full and no
rights thereunder may be exercised.
(c) If the Optionee's service on the Board terminates
by reason of the Optionee's Retirement or Disability, the
Optionee may, for a period of one (1) year after such
termination, exercise the Option in part or in full, after which
time the Option shall automatically terminate in full, subject to
paragraph (d) immediately below.
(d) In the event of the death of the Optionee (i)
while serving on the Board, (ii) within the three-month period
following the Optionee's termination of service on the Board for
any reason other than Cause, Retirement, Disability or death or
(iii) within the one-year period following the Optionee's
termination of service on the Board by reason of Retirement or
Disability, the Option shall be exercisable (to the extent, and
only to the extent, provided under the terms of Section 3.3 of
the Plan) by the executors, administrators, legatees or
distributees of the Optionee's estate, as the case may be, for a
period of one (1) year after the Optionee's death.
(e) For purposes of this Section 4, the Optionee shall
not be deemed to have terminated service on the Board during any
period the Optionee continues to serve as an honorary or emeritus
Board member.
5. Certain Adjustments. In the event of a change in
the capital of the Company (as described in Section 3.6 of the
Plan) if the Board shall determine, in its sole discretion, that
such change equitably requires such an adjustment, appropriate
adjustment shall be made with respect to the number or kind of
shares subject to the Option or the Exercise Price or repurchase
price applicable with respect to the Option, all in accordance
with Section 3.6 of the Plan.
6. Corporate Event. Upon a dissolution or liquidation
of the Company, or a sale of substantially all of the assets of
the Company and its Subsidiaries in which the acquiring entity
does not substitute a new and equivalent option for the Option,
or a merger or consolidation in which the Company is not to be
the surviving corporation and the surviving corporation does not
substitute a new and equivalent option for the Option (a
"Corporate Event"), the Optionee shall be given at least ten days
prior written notice of the occurrence of such event, the Option
shall become fully exercisable, and the Optionee may exercise the
Option, in whole or in part, prior to or simultaneously with such
event. To the extent the Option is not exercised prior to the
occurrence of any such event, the Option shall terminate upon
such event.
7. Securities Law Compliance. The Company shall not
be required to issue or deliver any certificate for any Shares
purchased hereunder prior to compliance with applicable federal
and state laws and regulations with respect to the issuance,
registration, listing or sale of such Shares.
8. Amendments or Discontinuance. Subject to the terms
of the Plan, the Plan and the Option may be amended by the Board
from time to time, provided that no amendment of the Plan or the
Option shall adversely affect the Option without the consent of
the Optionee.
9. Miscellaneous; Governing Law.
(a) The Option and this Option Agreement shall be
construed, administered and governed in all respects under and by
the internal laws of the State of New York (and not its choice of
law provisions).
(b) Neither the grant of the Option nor any provision
of this Option Agreement shall confer any right on the Optionee
to remain a director of the Company
IN WITNESS WHEREOF, this Option Agreement is executed
as of the date first written above.
ARROW ELECTRONICS, INC.
By: SAMPLE FORM
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
The undersigned Optionee hereby accepts the foregoing
Option and Option Agreement and undertakings on the part of the
Optionee contained herein and in the Plan, and agrees to all of
the terms and conditions this Option Agreement and the Plan.
DATED: _______________, 19 ___ ______________________________
Optionee
