Exhibit 10.13
GREY WOLF, INC
AMENDMENT TO NON-QUALIFIED STOCK OPTION AGREEMENTS
[TPR - FORM]
November 13, 2001
THIS AMENDMENT TO NON-QUALIFIED STOCK OPTION AGREEMENT (this
"Agreement") is by and between Grey Wolf, Inc. (the "Corporation"), a Texas
Corporation, and Xxxxxx X. Xxxxxxxx (the "Optionee"), and is an amendment to all
of those certain Non-Qualified Stock Option Agreements entered into by and
between the Corporation and the Optionee as more particularly described on
Exhibit "A" hereto (the "Original Option Agreements") pursuant to the
Corporation's 1996 Employee Stock Option Plan dated effective July 29, 1996 (the
"Plan").
WHEREAS, the Corporation granted certain options to Optionee under the
Plan as more particularly described on Exhibit "A" hereto; and
WHEREAS, the Board of Directors of the Corporation has approved certain
changes to the Original Option Agreements in this Agreement pursuant to that
certain Consent of Directors dated November 13, 2001; and
WHEREAS, the Corporation and the Optionee deem it desirable, for and in
the best interests of the parties to this Agreement, to modify the Original
Option Agreements as provided herein.
NOW THEREFORE BE IT RESOLVED, that the Corporation and the Optionee do
hereby agree to amend the Original Option Agreements as follows:
1. Corporate Proceedings of the Corporation. Section 9(b) and 9(c) of
the Original Option Agreements shall be deleted in their entirety and the
following new Sections 9(b) and 9(c) substituted therefor and new Section 9(f)
shall be added:
"9. Corporate Proceedings of the Corporation.
(b) If the Corporation merges into or with or
consolidates with (such events collectively referred herein as
a "Merger") any corporation or corporations and is not the
surviving corporation, then the Corporation shall cause the
surviving corporation to assume the Option or substitute a new
option of the surviving corporation for the Option (with an
Exercise Period at least equal to the period remaining until
the Expiration Date for the Option). In the event that the
Option is assumed or a new option of the surviving corporation
is substituted for the Option (i) if, on the effective date of
the Merger, the Option is "in the money" the excess of the
aggregate fair market value of the shares subject to the
Option immediately after such assumption, or the new option
immediately after such substitution, over the aggregate
Exercise Price of such shares must be, based upon a good faith
determination by the Board of Directors of the Corporation,
not less than the excess of the aggregate fair market value of
the Common Stock subject to the Option
immediately before such substitution or assumption over the
aggregate Exercise Price of such Common Stock and (ii) if, on
the effective date of the Merger, the Option is "out of the
money" the excess of the aggregate Exercise Price of the
shares subject to the Option immediately after such
assumption, or the new option immediately after such
substitution over the fair market value of such shares must
be, based upon a good faith determination by the Board of
Directors of the Corporation, not more than the excess of the
aggregate Exercise Price of the Common Stock subject to the
Option immediately before such assumption or substitution over
the aggregate fair market value of such Common Stock.
(c) In the event of a dissolution or liquidation of
the Corporation, the Corporation shall cause written notice of
such dissolution or liquidation (and the material terms and
conditions thereof) to be delivered to the Optionee at least
ten (10) days prior to the proposed effective date (the
"Effective Date") of such event. The Optionee shall be
entitled to exercise the Option (as to all Option Shares,
whether or not the Option is then otherwise exercisable under
Section 2) until the Effective Date, or until the Expiration
Date if earlier. Any Option which has not been exercised on or
before the Effective Date shall terminate.
(f) In the event that neither the shares of stock of
the Corporation nor shares of stock of the surviving
corporation are listed on an established exchange as a result
of a "going private" transaction, the Fair Market Value of the
Option (as to all Option Shares, whether or not the Option is
then exercisable under Section 2) shall be determined as soon
as practicable after completion of the "going private"
transaction. Optionee shall be paid the Fair Market Value of
such Option by cashiers check or wire transfer of immediately
available funds within ten (10) days after the determination
of such Fair Market Value. The Option shall terminate upon
receipt of such payment by the Optionee. For purposes of this
Section 9(f), the "Fair Market Value" of the Option purchased
shall be determined as follows: (i) If the Optionee and the
Corporation can agree on the Fair Market Value of the Option
within fifteen (15) days following completion of the going
private transaction, the Fair Market Value will be the agreed
value of the Option; (ii) If the Optionee and Corporation
cannot agree on the Fair Market Value of the Option, the value
will be determined as follows: (1) Each party shall, within
thirty (30) days following completion of the going private
transaction, provide written notice of the appointment of an
appraiser to the other party. If the parties appoint the same
appraiser or if only one appraiser is timely appointed, then
the timely appointed appraiser shall be the only appraiser and
shall prepare and deliver the appraised value of the Option
taking into consideration the "Black-Scholes" method of
valuation of such Option within thirty (30) days following its
appointment; (2) If the parties each timely appoint different
appraisers, such appraisers shall agree upon a third appraiser
within fifteen (15) days following their appointment. If such
appraisers cannot agree upon a third appraiser within fifteen
(15) days following their appointment, either the Optionee or
the Corporation may petition any United States federal
district court in the Southern District of Texas to appoint
such appraiser; (3) Each appraiser shall complete his
appraisal of the Option taking into consideration the
"Black-Scholes" method of valuation of such Option and deliver
a copy of his written appraisal to the Optionee
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and the Corporation within thirty (30) days of such
appraiser's appointment; (4) If there is more than one
appraiser, the Fair Market Value shall be the mathematical
average of the two closest appraisals; (5) Each appraiser
appointed hereunder shall have been actively involved in the
business of valuing and appraising companies in the oil and
gas service industry for the five year period immediately
preceding the date of appointment; and (6) The parties
understand and agree that the value of the Option is dependent
upon a valuation of the Corporation and that the appraisers
shall have access to the business records, assets and
properties of the Corporation as they may reasonably request
for the purpose of appraising the value of the Option."
2. Termination. Section 11 of the Original Option Agreements shall be
deleted in their entirety and the following new Section 11 substituted therefor:
"11. Termination. Except as otherwise provided in
this Section 11, if the Optionee for any reason whatsoever
ceases to be employed by the Corporation, or a parent or
subsidiary corporation of the Corporation, and prior to such
cessation, the Optionee was employed at all times from the
date of the granting of the Option until the date of such
cessation, the Option shall be exercisable by the Optionee
(whether previously exercisable or not) at any time on or
before the Expiration Date. Notwithstanding the foregoing:
(a) If the Optionee is terminated for Cause (as
defined below), the Option will terminate as to all of the
unexercised Option Shares on the thirtieth day following such
termination, during which thirty (30) days the Optionee may
exercise the Option as to the Option Shares exercisable on or
prior to the date of such termination for Cause; provided,
however, no unvested Option shall vest during such thirty (30)
day period; and
(b) If the Optionee's employment is terminated as a
result of a voluntary resignation (which is neither a
termination without cause nor a constructive termination
without cause as described in the Optionee's employment
agreement with the Corporation) the Optionee may exercise the
Option as to all of the Option Shares as provided above in
this Section 11; provided that no unvested Option shall vest
as a result of such voluntary resignation or thereafter.
For purposes of this Agreement, the term "Cause"
shall mean and include (i) chronic alcoholism or controlled
substance abuse as determined by a doctor mutually acceptable
to the Corporation and the Optionee, (ii) an act of proven
fraud or dishonesty on the part of the Optionee with respect
to the Corporation or its subsidiaries; (iii) knowing and
material failure by the Optionee to comply with material
applicable laws and regulations relating to the business of
the Corporation or its subsidiaries; (iv) the Optionee's
material and continuing failure to perform (as opposed to
unsatisfactory performance) his duties to the Corporation
except, in each case, where such failure is caused by the
illness or other similar incapacity or disability of the
Optionee; or (v) conviction of a crime involving moral
turpitude or a felony. Prior to the effectiveness of
termination for Cause under subclause (i), (ii), (iii) or (iv)
above, the Optionee shall be given thirty (30) days prior
notice from the
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Board specifically identifying the reasons which are alleged
to constitute Cause hereunder and an opportunity to be heard
by the Board in the event Optionee disputes such allegations.
Nothing in (a) or (b) shall extend the time for
exercising the Option granted pursuant to the Original Option
Agreements beyond the Expiration Date."
3. In all other respect, the terms and provisions of the Original
Option Agreements are hereby reaffirmed by the Corporation and the Optionee.
IN WITNESS WHEREOF, the parties have executed this Amendment to
Non-Qualified Stock Option Agreements as of the date first above written.
GREY WOLF, INC.
By:
--------------------------------
Name: XXXXXX X. XXXXXXX
Title: CHAIRMAN, COMPENSATION COMMITTEE
BOARD OF DIRECTORS
XXXXXX X. XXXXXXXX
-----------------------------
Title: PRESIDENT AND CHIEF EXECUTIVE OFFICER
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EXHIBIT "A"
TO
GREY WOLF, INC.
AMENDMENT TO NON-QUALIFIED STOCK OPTION AGREEMENTS
NOVEMBER 13, 2001
NUMBER OF OPTIONS
OPTIONEE DATE OF ORIGINAL OPTION AGREEMENTS GRANTED
-------- ---------------------------------- -------
Xxxxxx X. Xxxxxxxx March 5, 1998 147,700
February 15, 1999 500,000
February 24, 2000 400,000
February 9, 2001 400,000
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TOTAL OUTSTANDING 1,447,700
