EXHIBIT 10.13
OPTION AGREEMENT
This Option Agreement ("Agreement"), made and entered into as of June 12,
1997, is by and between CRC Holdings Corp., a Delaware corporation (the
"Company") and _________________________ (the "Optionee").
WITNESSETH:
WHEREAS, the Optionee is an employee of the Company or one or more of its
subsidiaries (collectively, the Company and its subsidiaries are the "Related
Parties") and the Board of Directors of the Company has determined that the
Company should recognize the potential contributions that the Optionee may make
to the success of the Related Parties by granting him an option to purchase
shares of Common Stock in the Company upon the terms set forth herein;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements hereinafter set forth, the Company and Optionee hereby
agree as follows:
1. CERTAIN DEFINITIONS. The following terms shall have the following
meanings:
"EXPIRATION DATE" means 6:00 P.M., Houston, Texas time, on August
31, 2002.
"1933 ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"STATE LAW" means applicable state securities laws and the rules and
regulations promulgated thereunder.
"VOTING AGREEMENT" the Voting and Shareholders Agreement dated as of
June 12, 1997 among the Company and certain holders of its shares, as such
agreement may be amended from time to time.
2. GRANT OF OPTION. Subject to the terms and conditions hereinafter set
forth, the Company hereby irrevocably grants to the Optionee the right and
option (the "Option") to purchase shares ("Option Shares") of Common Stock,
subject to adjustment in accordance with the provisions of Section 7 of this
Agreement.
3. OPTION PRICE. The price to be paid by Optionee to the Company for each
Option Share purchased pursuant to the exercise of this Option ("Option Price")
shall $[111.00] per share; provided, however, that the Option Price shall be
subject to adjustment in accordance with the provisions of Section 7 of this
Agreement.
4. VESTING OF RIGHT TO EXERCISE OPTION; FORFEITURE OR REPURCHASE UPON
TERMINATION OF EMPLOYMENT.
(a) Except as otherwise provided in this Agreement, the right to exercise
this Option shall vest as to twenty percent (20%) of the total Option Shares
which may be purchased hereunder on each anniversary of the date of issuance of
this Option, beginning with the first anniversary and continuing until the fifth
anniversary, at which time this Option shall be fully vested. From and after
each date of vesting, Optionee may exercise this Option, subject to the terms
and conditions set forth herein, to purchase all or any portion of the Option
Shares for which Optionee's rights have vested.
(b) To the extent Optionee does not purchase all or any part of the Option
Shares at the times this Option becomes exercisable, the Optionee has the right
cumulatively thereafter to purchase any Option Shares not so purchased and such
right shall continue until this Option terminates or expires.
(c) If Optionee's employment is terminated by one of the Related Parties
for "cause" (as defined below) or if Optionee shall voluntarily terminate his
employment by the Related Parties or its subsidiaries (through resignation or
otherwise), the Option shall automatically terminate as of the date of such
termination and any rights to purchase Option Shares which may have vested prior
to such termination shall be forfeited. For purposes hereof, a termination for
"cause" will include any of the following: (A) Optionee's conviction of, or plea
of nolo contendere to, any felony or to any crime or offense causing substantial
harm to the Related Parties or their affiliates or involving acts of theft,
fraud, embezzlement, moral turpitude or similar conduct; (B) Optionee's repeated
intoxication by alcohol or drugs during the performance of his duties for the
Related Parties in a manner that materially and adversely affects Optionee's
performance of such duties; (C) malfeasance in the conduct of Optionee's duties
for the Related Parties, including, but not limited to, (1) willful and
intentional misuse or diversion of funds of the Related Parties or their
affiliates, (2) embezzlement, or (3) fraudulent or willful and material
misrepresentations or concealments on any written reports submitted to the
Related Parties or their affiliates; (D) Optionee's material violation of any
provision of the Voting Agreement among Optionee, the Company and others; (E)
Optionee's material failure to perform the duties of Optionee's employment or
material failure to follow or comply with the reasonable and lawful written
directives of the Board of Directors of the Related Parties, in either case
after Optionee shall have been informed, in writing, of such material failure
and given a period of not more than 60 days to remedy same.
(d) If Optionee's employment by the Related Parties is terminated by a
Related Party for reasons other than "cause", the portion of this Option which
has vested may be exercised, but only within three months after such termination
(if otherwise prior to the date of expiration of this Option), and not
thereafter, to purchase the number of Option Shares, if any, that could be
purchased upon exercise of this Option at the date of termination of Optionee's
employment (the "Vested Option Shares"); provided that, in lieu of permitting
the exercise of this Option, the Company may, at the sole discretion, redeem
this Option, by paying cash to Optionee in an amount equal to the greater of:
(i) the amount, if any, by which the "Book Value" (as defined below) of the
Vested Option Shares exceeds the Option Price for such shares, or (ii) $100.
For purposes of this subsection (d), the "Book Value" of the Vested
Options Shares is equal to (A) the Company's total stockholders equity, as set
forth in the Company's consolidated balance
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sheet for its most recently concluded fiscal quarter, divided by, the number of
shares of Common Stock outstanding, as set forth in the Company's consolidated
balance sheet for its most recently concluded fiscal quarter, times (B) the
number of Vested Option Shares.
For purposes of this subsection (d), if this Option shall not have fully
vested as of the date of termination of Optionee's employment, then a ratable
portion of the number of Option Shares which would have become purchasable upon
the next vesting date shall be deemed to have vested as of the date of such
termination (determined by multiplying the number of Option Shares that vest on
the next vesting date by a fraction with a numerator equal to the number of full
months which have then elapsed since the last vesting date and a denominator of
12, and rounding to the closest whole number).
(e) In the event of Optionee's death or disability, this Option shall
remain outstanding and may be exercised by the person who acquires this Option
by will or the laws of descent and distribution, or by Optionee, as the case may
be, but only (i) within the one year period following the date of death or
disability (if otherwise prior to the date of expiration of this Option), and
not thereafter, and (ii) to purchase the number of Option Shares that were
subject to purchase upon exercise of this Option at the time of such death or
disability.
5. RESTRICTIONS ON EXERCISE. The right to exercise the Option shall be
subject to the following restrictions:
(a) VESTING. Optionee shall have no right to exercise this Option to
purchase any Option Shares for which Optionee's rights have not yet vested in
accordance with Section 4.
(b) NO FRACTIONAL OPTION SHARES. The Option may be exercised only with
respect to full Option Shares.
(c) COMPLIANCE WITH LAW. The Option may not be exercised in whole or in
part, and no Option Shares shall be issued nor certificates representing such
Option Shares delivered pursuant to any exercise of the Option, if any requisite
approval or consent of any governmental authority of any kind having
jurisdiction over the exercise of options or the issuance and sale of Option
Shares shall not have been obtained or if such exercise or issuance would
violate any applicable law.
(d) EXERCISE BY OPTIONEE. The Option shall only be exercisable by the
Optionee and by any transferee who has received such Option pursuant to Section
4(e).
(e) VOTING AGREEMENT. Optionee shall have no right to exercise this Option
to purchase any Option Shares until Optionee and Optionee's spouse (if Optionee
has a spouse) shall have executed and delivered to the Company a counterpart of
the Voting Agreement. Any Option Shares purchased upon exercise of this Option
shall be subject to the terms of the Voting Agreement.
6. EXERCISE OF OPTION.
(a) Subject to the other terms and provisions of this Agreement, the
Option shall be
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exercisable by written notice timely given to the Company by the Optionee, which
notice (i) shall state the number of Option Shares that the Optionee then
desires to purchase, and (ii) shall be accompanied by payment in full of the
Option Price for each of such Option Shares, which such payment shall be made in
cash or certified check.
(b) The Company shall be entitled to require the Optionee to deliver to
the Company such documents as the Company in its discretion shall deem necessary
to confirm that (i) such exercise and the Company's issuance and sale of such
Option Shares are in compliance with the requirements of any applicable laws
(including, but not limited to, the Securities Act of 1933 and applicable state
law) and (ii) the Optionee shall be bound by and comply with all of the terms
and provisions of the Voting Agreement.
(c) Unless the Company and Optionee shall make mutually acceptable
alternative arrangements, at the time of exercise of the Option, Optionee shall
pay to the Company, in cash, any federal, state and local taxes required by law
to be paid or withheld in connection with such exercise.
7. RECAPITALIZATION OR REORGANIZATION; ADJUSTMENTS.
(a) The existence of this Option shall not affect in any way the right or
power of the Company to make or authorize any adjustment, recapitalization,
reorganization or other change in the Company's capital structure or its
business, any merger or consolidation of the Company, any issuance of additional
Company securities with priority over the Common Stock or otherwise affecting
the Common Stock or the rights thereof, the dissolution or liquidation of the
Company's common stock or any sale, lease, exchange or other disposition of all
or any part of its assets or business or any other corporate act or proceeding.
(b) If (i) the Company merges, consolidates or reconstitutes with or into
any other entity (in a situation in which the Company is not the surviving
entity), (ii) the Company sells, leases or exchanges or agrees to sell, lease or
exchange all or substantially all of its assets to any other person or entity,
or (iii) the Company is to be dissolved and liquidated (each such event is
referred to herein as a "Fundamental Change"), the Company shall declare any
portion of the Option which has not then vested to be vested, so that the
Optionee shall have an opportunity to exercise the Option prior to the
consummation of the Fundamental Change.
(c) If the Company subdivides its outstanding common stock into greater
shares of common stock, the Option Price in effect immediately prior to such
subdivision shall be proportionately reduced, and the number of Option Shares
then subject to the Option shall be proportionately increased. Conversely, if
the outstanding shares of common stock of the Company are combined into a
smaller number of shares, the Option Price in effect immediately prior to such
combination shall be proportionately increased, and the number of Option Shares
then subject to the Option shall be proportionately reduced.
8. TERMINATION OF OPTION. The Option shall terminate upon the first to
occur of the (i) the Expiration Date, (ii) the date on which Optionee purchases,
or in writing surrenders his right to purchase, all Option Shares or other
securities then subject to the Option, or (iii) the date of termination pursuant
to Section 4 hereof.
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9. RESTRICTION ON TRANSFER OF OPTION. The Option may not be sold,
assigned, hypothecated or transferred, except by will or by the laws of descent
and distribution. Any attempted transfer of the Option in violation of this
provision shall be void and of no effect whatsoever.
10. CERTAIN RIGHTS INCIDENT TO DIVORCE. If an interest in the Option is
required by law to be transferred to a spouse of Optionee pursuant to an order
of a court in a divorce proceeding (notwithstanding the provisions of Section 9
hereof), Optionee shall nevertheless retain all rights with respect to the
exercise of the Option and any interest of such spouse shall be subject to such
rights of Optionee. In addition, if it is determined that Optionee will be
required to pay any taxes attributable to the interest of the spouse in the
Option, any tax liability of Optionee which is attributable to such spouse's
interest shall be taken into account, and shall reduce such spouse's interest in
this Option.
11. RIGHTS AS A SHAREHOLDER. Optionee shall have no rights as a
shareholder of the Company with respect to any Option Shares covered by the
Option until the exercise of the Option.
12. ADDITIONAL DOCUMENTS. The Company and the Optionee will, upon request
of the other party, promptly execute and deliver all additional documents, and
take all such further action, reasonably deemed by such party to be necessary,
appropriate or desirable to complete and evidence the sale, assignment and
transfer of the Option Shares pursuant to this Agreement.
13. REPRESENTATIONS, WARRANTIES AND COVENANTS OF OPTIONEE.
(a) The Optionee acknowledges that neither the Option nor the Option
Shares covered thereby have been registered under the 1933 Act or State Law on
the grounds that the issuance of the Option is, and the sale of any Option
Shares pursuant to the exercise of the Option will be, exempt from registration
under one or more provisions of each of such acts. The Optionee further
understands that in determining the availability and applicability of such
exemptions and in executing and delivering this Agreement and issuing and
delivering any Option Shares upon exercise of the Option, the Company has relied
and will rely upon the representations, warranties and covenants made by the
Optionee herein and in any other documents which he may hereafter deliver to the
Company. Accordingly, the Optionee represents and warrants to and covenants and
agrees with the Company as follows:
(i) the Optionee is acquiring and will hold the Option, and will
acquire and hold all securities which he acquires upon exercise of the
Option, for his own account for investment and not with a view to any sale
or distribution of all or any part thereof; and
(ii) the Optionee will hold all securities acquired by him upon
exercise of the Option, as well as any and all other securities issued in
respect thereof, subject to all applicable provisions of the Voting and
Shareholders Agreement of the Company, the 1933 Act and State Law, and
will not at any time make any sale, transfer, pledge or other disposition
or encumbrance of any of such securities in violation of the Voting and
Shareholders Agreement of the Company or in the absence of an effective
registration statement for such securities under the 1933 Act and State
Law or an applicable exemption from the registration requirements
therefrom.
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(b) The Optionee agrees (i) that the certificates representing the Option
Shares or other securities purchased under this Option may bear such legend or
legends as the Company deems appropriate in order to assure compliance with
applicable securities laws, (ii) that the Company may refuse to register the
transfer of the Option Shares or other securities purchased under this Option on
the transfer records of the Company if such proposed transfer would in the
opinion of counsel satisfactory to the Company constitute a violation of any
applicable securities laws, (iii) that the Company may give related instructions
to its transfer agent, if any, to stop registration of the transfer of the
Option Shares or other securities purchased under this Option, and (iv) that the
Option Shares or other securities acquired upon exercise of this Option shall be
subject, in all respects, to the Voting and Shareholders Agreement of the
Company.
(c) Optionee acknowledges that the value of the Option over its life will
be speculative and uncertain, that there is no market for the Option or the
Option Shares or other securities that may be acquired upon exercise of the
Option and it is unlikely that any market will develop, and consequently, the
Optionee may ultimately realize no value from the Option.
14. NOTICES. All notices required or permitted to be given hereunder shall
be in writing and shall be deemed to have been given on the earlier of the date
of receipt by the party to whom the notice is given or five (5) days after being
mailed by certified or registered United States mail, postage prepaid, addressed
to the appropriate party at the address shown beside such party's signature
below or at such other address as such party shall have theretofore designated
by written notice given to the other party.
15. ENTIRETY AND MODIFICATION. This Agreement contains the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes any and all prior agreements, whether written or oral, between
such parties relating to such subject matter. No modification, alteration,
amendment or supplement to this Agreement shall be valid or effective unless the
same is in writing and signed by the party against whom it is sought to be
enforced.
16. SEVERABILITY. If any provision of this Agreement is held to be
unenforceable, this Agreement shall be considered divisible, and such provision
shall be deemed inoperative to the extent it is unenforceable, and in all other
respects this Agreement shall remain in full force and effect; provided,
however, that if any such provision may be made enforceable by limitation
thereof, then such provision shall be deemed to be so limited and shall be
enforceable to the maximum extent permitted by applicable law.
17. GENDER. Words used in this Agreement which refer to Optionee and
denote the male gender shall also be deemed to include the female gender or the
neuter gender when appropriate.
18. HEADINGS. The headings of the various sections and subsections of this
Agreement have been inserted for convenient reference only and shall not be
construed to enlarge, diminish or otherwise change the express provisions
hereof.
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19. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE (REGARDLESS OF THE LAWS THAT
MIGHT OTHERWISE GOVERN UNDER APPLICABLE DELAWARE PRINCIPLES OF CONFLICTS OF
LAW).
20. COUNTERPARTS. This Agreement may be signed in counterparts, each of
which shall be deemed an original and all of which shall constitute one and the
same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first set forth above.
CRC HOLDINGS CORP.
By: _______________________________
OPTIONEE
Number of Option
Shares:
____________________________________
