Exhibit 99.18
AMENDED AND RESTATED NONQUALIFIED STOCK OPTION AGREEMENT
1999 Stock Option Plan of Titan Exploration, Inc.
This Amended and Restated Option Agreement ("Agreement"), made
and entered into effective as of [date] by and among Pure Resources, Inc., a
Delaware corporation, as successor to Titan Exploration, Inc., a Delaware
corporation (the "Company"), Unocal Corporation, a Delaware corporation
("Unocal") and the "Optionee").
WITNESSETH:
WHEREAS, the 1999 Stock Option Plan of Titan Exploration, Inc.
("Plan") was adopted by the Company, effective as of ("Plan Date"), for
the benefit of certain employees of the Company and its subsidiaries; and
WHEREAS, the Optionee and the Company had entered into an
option agreement effective as of the date first set forth on Annex A (the "Prior
Option Agreement"), and pursuant to such Prior Option Agreement, the Committee
has granted to the Optionee Non-Qualified Stock Options to purchase shares of
Common Stock, par value $0.01, of the Company ("Pure Shares") pursuant to the
Plan and upon the terms set forth in the Prior Option Agreement (the "Pure
Options"); and
WHEREAS, as a result of certain modification to the Plan
following the consummation of the merger of a subsidiary of Union Oil Company of
California into the Company, effective as of October 29, 2002 (the "Merger"),
the terms of the Prior Option Agreement and the Pure Option will be amended.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements hereinafter set forth, the Company, Unocal and
Optionee hereby agree as follows:
1. Certain Definitions. Terms used in this Agreement and not otherwise
defined shall have the respective meanings assigned to such terms in the Plan;
and the following terms shall have the following meanings:
Companies means the Company and any of its Subsidiaries (as defined in
the Plan).
Expiration Date means 6:00 P.M., Midland, Texas time, on the date (or
dates, as the case may be) set forth on Annex A.
2. Conversion of Options. Subject to the terms, conditions and
provisions of the Plan and those hereinafter set forth, each Pure Option to
purchase that
number of Pure Shares as set forth under "Original Grant Number" on Annex A has
been converted into an option to purchase that number of shares of the common
stock, par value $1.00 of Unocal ("Shares") as set forth under "Adjusted Grant
Number" on Annex A (the "Options"), subject to any future adjustment in
accordance with the provisions of Section 7 of this Agreement.
3. Option Price. The price to be paid by Optionee to Unocal for each
Share purchased pursuant to the exercise of the Options (the "Option Price")
shall be the price set forth under "Adjusted Strike Price" on Annex A; provided,
however, that the Option Price shall be subject to any future adjustment in
accordance with the provisions of Section 7 of this Agreement.
4. Vesting of Right to Exercise Option.
(a) The right to exercise the Options is fully vested as of October 30,
2002. Optionee may exercise the Options, subject to the terms and
conditions set forth herein, to purchase all or any portion of the
Shares for which Optionee's rights have vested.
(b) To the extent Optionee does not purchase all or any part of the
Shares at the times the Options become exercisable, the Optionee has
the right cumulatively thereafter to purchase any Shares not so
purchased and such right shall continue until the Options terminate or
expire.
(c) If Optionee's employment is terminated on account of fraud or
dishonesty or other acts which the Committee determines are materially
detrimental to the interests of the Company or a Subsidiary or Union
Oil Company of California, the Options shall automatically terminate as
of the date of such termination of employment.
(d) If Optionee's employment is terminated voluntarily by Optionee, the
Options may be exercised, but only within three months after such
termination (if otherwise prior to the date of expiration of the
Options), and not thereafter.
(e) In the event of Optionee's termination of employment by reason of
death or disability (within the meaning of Section 22(e)(3) of the
Code), or by action of the Companies for reasons other than as
specified in subsection (c) (and following such termination the
Optionee is not immediately offered employment by Union Oil Company of
California), the Options may be exercised by the person who acquires
the Options by will or the laws of descent and distribution, or by
Optionee (or the Optionee's legal guardian in the event one is
appointed as a result of Optionee's disability), as the case may be,
but only within the first to occur of (i) the end of the one year
period following the date of termination or (ii) the date of expiration
of the Options, and not thereafter.
5. Restrictions on Exercise. The right to exercise the Option shall be
subject to the following restrictions:
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(a) No Fractional Shares. The Option may be exercised only with respect
to full Shares.
(b) Compliance with Law. The Option may not be exercised in whole or in
part, and no Shares shall be issued nor certificates representing such
Shares (if any) 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 Shares shall not have been obtained or if such exercise or
issuance would violate any applicable law.
(c) 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).
6. Exercise of Option.
(a) Subject to the other terms and provisions of this Agreement and the
Plan, the Option shall be exercisable by written notice timely given to
Unocal by the Optionee (the `Exercise Notice"), which notice (i) shall
state the number of 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 Shares. Unless Unocal and Optionee shall have made
mutually acceptable alternative arrangements, payment of the Option
Price shall be made in cash or, with the consent of the Committee, by
surrender of previously acquired nonforfeitable, unrestricted Shares
owned by the Optionee (the "Payment Shares"), having an aggregate Fair
Market Value at the time of exercise equal to the Option Price.
(b) Payment of the total Option Price may also be made, in the
discretion of the Committee, by delivery to Unocal or its designated
agent of an executed irrevocable option exercise form together with
irrevocable instructions to a broker-dealer to sell or margin a
sufficient portion of the Shares with respect to which the Options are
exercised and deliver the sale or margin loan proceeds directly to
Unocal to pay the Option Price and any required federal, state and
local taxes.
(c) Unless Unocal and the Optionee shall make mutually acceptable
alternative arrangements, at the time of exercise of the Options, the
Optionee shall pay to Unocal (or the Company, if so directed by Unocal)
any federal, state and local taxes required by law to be paid or
withheld in connection with such exercise. Unocal may require the
Optionee to pay to Unocal such taxes prior to and as a condition of the
issuance or delivery of the Shares and Unocal or a Subsidiary shall be
entitled to deduct from any other compensation payable to the Optionee
any tax withholding obligations with respect to the Options.
7. Recapitalization or Reorganization; Adjustments.
(a) The existence of the Options shall not affect in any way the right
or power of Unocal to make or authorize any adjustment
recapitalization, reorganization
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or other change in Unocal's capital structure or its business, any
merger or consolidation of Unocal, any issuance of additional
securities by Unocal with priority over Shares or otherwise affecting
Shares or the rights thereof, the dissolution or liquidation of Unocal
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 Unocal subdivides its outstanding Shares into a greater number
of Shares, the Option Price in effect immediately prior to such
subdivision shall be proportionately reduced, and the number of Shares
then subject to the Options shall be proportionately increased.
Conversely, if the outstanding number of Shares of Unocal 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 Shares then subject to the Options shall be proportionately
reduced.
8. Termination of Option. Unless terminated earlier pursuant to Section
4 hereof, the Options shall terminate upon the first to occur of the (i) the
Expiration Date (for each such Option as set forth on Annex A), or (ii) the date
on which Optionee purchases, or in writing surrenders his right to purchase, all
Shares or other securities then subject to the Options.
9. Restriction on Transfer of Option. The Options may not be sold,
assigned, hypothecated or transferred, except by will or by the laws of descent
and distribution. Any attempted transfer of the Options in violation of this
provision shall be void and of no effect whatsoever.
10. Certain Rights Incident to Divorce. If an interest in the Options
is required by law to be transferred to a spouse of the Optionee pursuant to an
order of a court in a divorce proceeding (notwithstanding the provisions of
Section 9 hereof), the Optionee shall nevertheless retain all rights with
respect to the exercise of the Options and any interest of such spouse shall be
subject to such rights of the Optionee. In addition, if it is determined that
the Optionee will be required to pay any taxes attributable to the interest of
the spouse in the Options, any tax liability which is attributable to such
spouse's interest shall be taken into account, and shall reduce such spouse's
interest in the Options.
11. Employment. Nothing in this Agreement shall confer upon Optionee
any right to continue in the employ of the Companies, nor shall this Agreement
interfere in any manner with the right of the Companies to terminate the
employment of Optionee with or without cause at any time.
12. Rights as a Shareholder. Optionee shall have no rights as a
shareholder of Unocal with respect to any Shares covered by the Options until
the exercise of the Options.
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13. Additional Documents. The Company, Unocal and the Optionee will,
upon request of any of the other parties, 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 Shares pursuant to this Agreement.
14. Representations, Warranties and Covenants of Optionee.
(a) The Optionee acknowledges that the Options have not been registered
under the Securities Act of 1933 or applicable state securities laws on
the grounds that the issuance of the Options is 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 Shares upon exercise of the
Options, Unocal 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 Unocal or the Company.
Accordingly, the Optionee represents and warrants to and covenants and
agrees with Unocal and the Company that the Optionee is acquiring and
will hold the Options for his own account for investment and not with a
view to any sale or distribution of all or any part thereof.
(b) The Optionee agrees that the certificates representing the Shares
or other securities purchased under the Options may bear such legend or
legends as Unocal deems appropriate in order to assure compliance with
applicable securities laws.
(c) Optionee acknowledges that the value of the Options over their life
will be speculative and uncertain, that there is no market for the
Options and it is unlikely that any market will develop, and
consequently, the Optionee may ultimately realize no value from the
Options.
15. 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.
16. 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.
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17. 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.
18. 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.
19. 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.
20. No Right to Continued Employment. Nothing contained in the Plan or
in this Agreement shall confer upon Optionee the right to continue in the employ
of the Companies, or interfere in any way with the rights of the Companies to
terminate Optionee's employment at any time, with or without cause.
21. Prior Option Agreement. This Agreement shall supercede the Prior
Option Agreement, which shall be void and of no further force or effect.
22. 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).
23. 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.
TITAN EXPLORATION, INC.
000 Xxxx Xxxxx By:
Suite 200 ------------------------------------
Xxxxxxx, Xxxxx 00000 Name:
Title:
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OPTIONEE
000 Xxxx Xxxxx By:
Suite 200 ------------------------------------
Xxxxxxx, Xxxxx 00000 Name:
Title:
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ANNEX A
Name of Pure Option Holder:
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Date of Prior Option Agreement:
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Original Grant Date Original Grant Original Strike Adjusted Grant Adjusted Strike Expiration Date
Number Price Number Price
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