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EXHIBIT 4
AGREEMENT
This Agreement (the "Agreement") is made and entered into as
of December 14, 1995, by and between Xxxxxx Management Corp. ("Xxxxxx") and
Xxxxxx X. Xxxxxxxx ("Xxxxxxxx").
WITNESSETH
WHEREAS, Xxxxxx owns options to purchase 200,000 shares of
common stock, par value $.16 2/3 per share (the "Common Stock"), of Tesoro
Petroleum Corporation (the "Company") at $8.25 per share, subject to
adjustment, which expire on May 16, 1996 (the "Options");
WHEREAS, Xxxxxxxx has agreed to participate in a consent
solicitation relating to the Company (the "Solicitation") and has agreed to
share in the payment of expenses of the Solicitation (the "Expense Payments")
and to initially contribute $100,000 to the Xxxxxx Management Escrow Account
(the "Xxxxxx Account") in connection therewith;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Contribution. Xxxxxxxx will upon the execution of
this Agreement contribute to the Xxxxxx Account $100,000.
2. Right to Reimbursement. In the event that Xxxxxxxx
is not reimbursed for his Expense Payments upon the termination of the
Solicitation, Xxxxxx hereby agrees to pay to Xxxxxxxx the lesser of (i) 30% of
the Profits (as defined below) or (ii) an amount equal to his Expense Payments.
3. Profits. Xxxxxx and Xxxxxxxx agree that the profits
(the "Profits") realized from Xxxxxx'x exercise of the Options and the sale of
shares of Common Stock acquired upon the exercise of such Options, shall equal
the difference obtained by subtracting (i) the sum of the option price plus the
option strike price from (ii) the net proceeds from the sale of the 200,000
shares of Common Stock acquired pursuant to the exercise of the Options.
4. No Duty to Sell Common Stock. Notwithstanding
anything to the contrary contained in this Agreement, Xxxxxx shall not have any
duty to exercise the Options or sell the shares of Common Stock acquired by
Xxxxxx through the exercise of the Options. In the event that Xxxxxx does not
elect to exercise or sell the Options or to sell shares of Common Stock,
Profits shall be computed as if shares of Common Stock were sold using as
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the sales price the last trade, regular way, on the New York Stock Exchange on
the day the Solicitation is terminated.
5. Liability for Options. The Parties hereto agree that
if the Options are for any reason invalid or not honored, Xxxxxx shall have no
liability as a result thereof.
6. Expiration of Options. Upon the expiration of the
Options this Agreement shall terminate.
7. Covenants of Xxxxxx. As long as this Agreement is in
effect, Xxxxxx hereby agrees not to dispose of the Options. For purposes
hereof, the expiration of the Options by their terms shall not be deemed to be
a disposition.
IN WITNESS WHEREOF, the undersigned have duly executed this
Agreement as of the date first written above.
XXXXXX MANAGEMENT CORP.
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
