NON-QUALIFIED STOCK OPTION AGREEMENT
UNDER THE XXXXXXXX RESOURCES, INC.
1999 LONG-TERM INCENTIVE PLAN
AGREEMENT made as of by and between Xxxxxxxx Resources, Inc. ("Company"),
and _________________________ ("Employee").
WHEREAS, the Company maintains the Xxxxxxxx Resources, Inc. 1999 Long-term
Incentive Plan (the "Plan") providing for the grant to employees of the Company
of options to purchase the common stock, par value $.50 per share (the "Common
Stock"), of the Company, to attract and retain key executive and managerial
employees and to motivate participating employees to achieve long-range goals;
and
WHEREAS, Employee is one of such key executive and managerial employees and
therefore has been selected to participate in the Plan; and
THEREFORE, in consideration of the mutual promise(s) and covenant(s)
contained herein, it is hereby agreed as follows:
X. XXXXX AND EXERCISE OF OPTIONS
1.1 Grant of Options. The Employee, in connection with his service as an
employee, shall have the right and option to purchase from the Company, at the
times and on the terms and conditions hereinafter set forth and in the Plan,
shares of the authorized Common Stock of the Company at the purchase price of
Three dollars and eighty-seven and one half cents ($3.875) per share (the
"Options"). The Options granted pursuant to this Agreement are not intended to
constitute incentive stock options within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended.
1.2 Exercise of Options. Employee shall vest in and shall have the right to
exercise the Options during the time intervals set forth below:
Number of Shares May Be Purchased Not Before Not After
Options may be exercised in whole or in part but only within the time intervals
specified hereinabove. Each exercise of an Option, or any part thereof, shall be
evidenced by a notice in writing to the Company as provided in Paragraph 1.3.
The purchase price of the Common Stock as to which an Option shall be exercised
shall be paid in full at the time of exercise as specified in Paragraph 1.5
herein. Employee shall not have any of the rights of a shareholder of the
Company with respect to the Common Stock covered by an Option except to the
extent that one or more certificates for such Common Stock shall have been
delivered to him, or he has been determined to be a shareholder of record by the
Company's Transfer Agent upon due exercise of the Option.
1.3 Written Notice. The Options granted herein shall be exercised only
in the State of Texas at the principal office of the Company by the Employee in
person by delivering to the Secretary of the Company a written notice specifying
the number of shares of Common Stock the Employee then desires to purchase, such
written notice to be in substantially the following form and to be signed by the
Employee:
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"I hereby purchase from Xxxxxxxx Resources, Inc. (the "Company") at Frisco,
Texas, shares of its Common Stock in accordance with the Company's 1999
Long-Term Incentive Plan, and in accordance with my Non-qualified Stock
Option Agreement dated ________. I hereby tender in payment therefor the
full Option Price."
1.4 Option Price. The purchase price for the shares subject to the Options
("Option Price") shall be $3.875 per share, which is the fair market value of
the shares of Common Stock on the date hereof.
1.5 Payment of Option Price. Payment of the Option Price for shares of
Common Stock purchased under this Agreement shall be made upon the exercise of
an Option and may be paid to the Company by any of the following, or a
combination thereof, at the election of the Employee:
(a) in cash (including check, bank draft, or money order); or
(b) by actual delivery (or by attestation) of shares of Common Stock
already owned by Employee and having a fair market value equal to the
aggregate Option Price;
(c) by delivery of a properly executed exercise notice together with
such other documentation as the Company and the broker shall require
to effect an exercise of the Option and delivery to the Company of the
sale or loan proceeds required to pay the Option Price and any
required withholding taxes.
II. TERMINATION OF EMPLOYMENT
2.1 Termination Before an Option Becomes Exercisable. If Employee's
employment with the Company shall be terminated for any reason whatsoever before
the date that any Option granted hereunder shall first have become exercisable
by Employee, then Employee's full interest in such Option shall terminate on the
date of such termination of employment and all rights under such Option shall
cease.
2.2 Discharge or Resignation. If Employee ceases to be an employee of the
Company, by reason of the fact that he is discharged for cause, as determined
solely and exclusively by the committee appointed by the Board to administer the
Plan (the "Committee"), or by reason of his resignation or voluntary action, all
rights of Employee to exercise the Options granted hereunder shall terminate,
lapse, and be forfeited at the time of Employee's termination of employment.
2.3 Retirement. If Employee's termination of employment is due to
retirement with the consent of the Company, Employee shall have the right to
exercise all Options then exercisable under this Agreement at any time within
three (3) months after such retirement; provided, however, that in case Employee
shall die within three (3) months after such date of retirement without having
exercised such Options, the personal representatives, heirs, legatees, or
distributees of Employee, as appropriate, shall have the right up to one (1)
year from such date of retirement to exercise any such Option to the extent that
the Option was exercisable prior to the death of Employee and had not been so
exercised.
2.4 Death. If Employee ceases to be an employee of the Company by reason of
death, the personal representatives, heirs, legatees, or distributees of
Employee, as appropriate, shall have the right up to one (1) year from the
termination of employment to exercise any Options which were exercisable prior
to death and had not been so exercised.
2.5 Disability. If Employee ceases to be an employee of the Company due to
his disability, as determined solely and exclusively by the Board of Directors,
Employee shall have the right to exercise all Options then exercisable under
this Agreement at any time within one (1) year after such termination; provided,
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however, that in case employee shall die within one (1) year after such date of
termination without having exercised such Options, the personal representatives,
heirs, legatees, or distributees of Employee, as appropriate, shall have the
right up to one (1) year from such date of termination to exercise any such
Option to the extent that the Option was exercisable prior to the death of
Employee and had not been so exercised.
2.6 Limitations on Exercise. Despite the provisions of Paragraphs 2.3, 2.4,
and 2.5, no Option shall be exercisable under any condition after the dates
specified in Paragraph 1.2. In addition, the provisions of Paragraphs 2.3, 2.4,
and 2.5 shall be subject to the provisions of Paragraphs 3.4, 3.5, and 3.6.
III. MISCELLANEOUS
3.1 Limited Transferability of Options. The Option may be transferred by
the Employee to a Permitted Transferee, as defined in the Plan, provided that
there cannot be any consideration for the transfer. Options transferred to
Permitted Transferees will remain subject to the terms and conditions of the
Plan and the stock option agreement as if the Employee still held such options.
References herein to option "Holder" shall mean the Employee or a Permitted
Transferee.
3.2 Restrictions on Exercise. The exercise of each Option granted under
this Agreement shall be subject to the condition that if at any time the Company
shall determine, in its discretion, that the satisfaction of withholding taxes
or other withholding liabilities, or that the listing, registration or
qualification of any shares of Common Stock otherwise deliverable upon such
exercise upon any securities exchange or under any state or federal law, or the
consent or approval of any regulatory body, is necessary or desirable as a
condition of, or in condition of, or in connection with, such exercise or the
delivery or purchase of such shares thereunder, then in any such event such
exercise shall not be effective unless such withholding, listing, registration,
qualification, consent, or approval shall have been effected or obtained free of
any conditions not acceptable to the Company.
3.3 Changes in Capital Structure If there is any change in the capital
structure of the Company through merger, consolidation, reorganization,
recapitalization, or otherwise, or if there shall be any stock dividend, stock
split or combination of shares of Common Stock, the number and the Option Price
of the shares with respect to which an Option has been granted hereunder shall
be proportionately adjusted by the Board as it deems equitable, in its absolute
discretion, to prevent dilution or enlargement of the rights of Employee. The
issuance of stock for consideration shall not be considered a change in the
Company's capital structure. No adjustment provided for in this Paragraph 3.3
shall require the issuance of any fractional shares of Common Stock.
3.4 Dissolution or Liquidation. In the event of the dissolution or
liquidation of the Company, any Option granted under this Agreement shall
terminate as of a date to be fixed by the Board of Directors, provided that not
less than thirty (30) days' written notice of the date so fixed shall be given
to Employee and Employee shall have the right during such period to exercise all
Options granted hereunder to the extent not previously exercised, even though
such Options might not otherwise be exercisable, by reason of an insufficient
lapse of time. At the end of such period, any unexercised Options shall
terminate and be of no further effect.
3.5 Reorganization. Subject to the provisions of Section 3.6, if
applicable, in the event of a merger, consolidation, combination, exchange of
shares or other similar change (a "Reorganization") in which the Company is not
the surviving or acquiring company, or in which the Company is or becomes a
wholly-owned subsidiary of another company after the effective date of the
Reorganization, then
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(a) If there is no plan or agreement respecting the Reorganization or
if such plan or agreement does not specifically provide for the change,
conversion, or exchange of the shares of Common Stock under outstanding and
unexercised Options for securities of another corporation, then the Board of
Directors shall take such action, and the options shall terminate, as provided
in Paragraph 3.4; or
(b) If there is a plan or agreement respecting the Reorganization and
if such plan or agreement specifically provides for the change, conversion, or
exchange of the shares of Common Stock under outstanding and unexercised Options
for securities of another corporation, then the Board of Directors shall adjust
the shares of Common Stock under such outstanding and unexercised Options (and
shall adjust the shares of Common Stock remaining under the Plan which are then
available to be optioned under the Plan, if such plan or agreement makes
specific provision therefor) in a manner not inconsistent with the provisions of
such plan or agreement for the adjustment, change, conversion, or exchange of
such shares of Common Stock and such Options.
3.6 Change in Control. If there is any Change in Control, all Options which
have been granted under this Agreement will automatically become fully
exercisable and vested.
3.7 Compliance with Securities Laws. The Company may elect not to register
under the Securities Act of 1933, as amended, shares of Common Stock issuable
upon the exercise of Options under the Plan. If so, then upon the exercise of an
Option hereunder Employee shall deliver to the Company such written commitments
as may be required by the Company. These commitments shall certify that Employee
is acquiring the shares of Common Stock solely for Employee's own account,
solely for investment and not with a view to distribution. These commitments
shall also certify that no distribution of the shares of Common Stock acquired
by Employee will be made unless registered under the above Act or pursuant to an
opinion of counsel satisfactory to the Company that the proposed distribution
may be consummated without violation of such Act. Absent registration of shares
of Common Stock issued under the Plan, the Company may place an appropriate
legend containing such restrictions on all certificates evidencing shares of
Common Stock distributed under the Plan.
3.8 Nonguarantee of Employment. Nothing in this Agreement shall confer
upon employee any right to continue in the employ of the Company or interfere in
any way with the right of the Company to terminate his employment at any time.
3.9 Options Subject to Plan. The Options granted hereunder are subject
to the terms and provisions of the Plan as adopted by the Board of Directors
effective as of April 1, 1999. In case of any conflict between this Agreement
and the Plan, the terms and provisions of the Plan shall be controlling. Unless
otherwise defined herein, all terms used herein that are defined in the Plan
shall have the same meaning herein as in the Plan.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
ATTEST: XXXXXXXX RESOURCES, INC.
BY:
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Title
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EMPLOYEE:
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