EXHIBIT 10.34
PLAINS RESOURCES INC.
INCENTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT, made as of the _____ day of ______________,
200__ (the "Grant Date"), between Plains Resources Inc., a Delaware corporation
(the "Company"), and _______(First Name) _______(Last Name) (the "Optionee").
WHEREAS, the Company has adopted the Plains Resources Inc.
2001 Stock Incentive Plan (the "Plan") in order to provide additional incentive
to certain employees, officers, consultants and directors of the Company and its
Subsidiaries, Affiliates and Divisions; and
WHEREAS, the Committee responsible for administration of the
Plan has determined to grant an option to the Optionee as provided herein;
NOW, THEREFORE, the parties hereto agree as follows:
1. Grant of Option.
1.1 The Company hereby grants to the Optionee the right and
option (the "Option") to purchase all or any part of an aggregate of ________
(Shares) whole Shares subject to, and in accordance with, the terms and
conditions set forth in this Agreement.
1.2 The Option is intended to qualify as an Incentive Stock
Option within the meaning of Section 422 of the Code and shall be so construed;
provided, however, that nothing in this Agreement shall be interpreted as a
representation, guarantee or undertaking on the part of the Company that the
Option is or will be determined to be an Incentive Stock Option within the
meaning of Section 422 of the Code. As noted in the Plan, to the extent that the
aggregate Fair Market Value (as determined under the Plan at the time of grant)
of the Shares with respect to which this Option plus all other Incentive Stock
Options Optionee holds are exercisable for the first time by Optionee during any
calendar year (under all plans of the Company and its Subsidiaries) exceeds one
hundred thousand dollars ($100,000), all or a portion of this Option or any
other Incentive Stock Options held by Participant that exceed such limit
(according to the order in which they were granted) shall be treated as
Nonqualified Stock Options.
1.3 The Option will be taxed as if it were a Nonqualified
Stock Option rather than an Incentive Stock Option if it is not exercised within
the following periods (if earlier than the end of the Exercise Term (as defined
below)):
(a) one day less than three months after the date of severance
of Optionee's employment with the Company and all Parent or
Subsidiary corporations for any reason other than death or
Disability; or
(b) on the last day within the one year period commencing on
the date of the Optionee's severance of employment with the
Company and all Parent or Subsidiary corporations because of
Disability.
1.4 This Agreement shall be construed in accordance and
consistent with, and subject to, the provisions of the Plan (the provisions of
which are incorporated herein by reference) and, except as otherwise expressly
set forth herein, the capitalized terms used in this Agreement shall have the
same definitions as set forth in the Plan.
2. Purchase Price.
The price at which the Optionee shall be entitled to purchase
Shares upon the exercise of the Option shall be $________ per Share. This price
is not less than 100% of the Fair Market Value of the Shares on the Grant Date
of this Option (110% in the event this Option is granted to a Ten-Percent
Stockholder).
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3. Duration of Option.
The Option shall be exercisable to the extent and in the
manner provided herein for a period of five years from the Grant Date (the
"Exercise Term"); provided, however, that the Option may be earlier terminated
as provided in Section 6 hereof.
4. Exercisability of Option.
Unless otherwise provided in this Agreement or the Plan, the
Option shall entitle the Optionee to purchase, in whole at any time or in part
from time to time, 25% of the total number of Shares covered by the Option after
the expiration of one (1) year from the Grant Date and an additional 25% of the
total number of Shares covered by the Option after the expiration of each of the
second, third and fourth anniversaries of the Grant Date, and each such right of
purchase shall be cumulative and shall continue, unless sooner exercised or
terminated as herein provided, during the remaining period of the Exercise Term.
Any fractional number of Shares resulting from the application of the foregoing
percentages shall be rounded to the nearest whole number of Shares.
5. Manner of Exercise and Payment.
5.1 Subject to the terms and conditions of this Agreement and
the Plan, the Option may be exercised by delivery in person, by telecopy or by
mail of written notice to the Company, at its principal executive office. Such
notice shall state that the Optionee is electing to exercise the Option and the
number of Shares in respect of which the Option is being exercised and shall be
signed by the person or persons exercising the Option. If requested by the
Committee, such person or persons shall (i) deliver this Agreement to the
Secretary of the Company who shall endorse thereon a notation of such exercise
and (ii) provide satisfactory proof as to the right of such person or persons to
exercise the Option.
5.2 The notice of exercise described in Section 5.1 hereof
shall be accompanied by the full purchase price for the Shares in respect of
which the Option is being exercised in any of the following forms, (i) cash,
(ii) the transfer of Shares to the Company having a Fair Market Value on the day
preceding the date of exercise equal to the cash amount for which such Shares
are substituted and which have been held by the Optionee for at least six (6)
months, or (iii) a combination of cash and the transfer of Shares.
5.3 Upon receipt of notice of exercise and full payment for
the Shares in respect of which the Option is being exercised, the Company shall,
subject to Section 18 of the Plan, take such action as may be necessary to
effect the transfer to the Optionee of the number of Shares as to which such
exercise was effective.
5.4 The Optionee shall not be deemed to be the holder of, or
to have any of the rights of a holder with respect to any Shares subject to the
Option until (i) the Option shall have been exercised pursuant to the terms of
this Agreement and the Optionee shall have paid the full purchase price for the
number of Shares in respect of which the Option was exercised, (ii) the Company
shall have issued and delivered the Shares to the Optionee, and (iii) the
Optionee's name shall have been entered as a stockholder of record on the books
of the Company, whereupon the Optionee shall have full voting, dividend and
other ownership rights with respect to such Shares.
6. Termination of Employment.
6.1 Termination for any Reason other than Cause. If the
Optionee's employment is terminated for any reason other than by the Company for
Cause, the Option shall continue to be exercisable in whole or in part (to the
extent exercisable on the date of such termination of employment) for the
duration of the Exercise Term. In the event of the Optionee's death, the Option
shall be exercisable, to the extent provided in the Plan and this Agreement, by
the legatee or legatees under his will, or by his personal representatives or
distributees and such person or persons shall be substituted for the Optionee
each time the Optionee is referred to herein.
6.2 Termination for Cause. If the employment of the Optionee
is terminated for Cause, any unexercised portion of the Option shall terminate
on the date of the Optionee's termination of employment (whether or not
exercisable).
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7. Effect of Change in Control.
Notwithstanding anything contained in this Agreement to the
contrary, in the event of a Change in Control, (i) the Option shall become
immediately and fully exercisable, and (ii) the Optionee will be permitted to
surrender for cancellation within ninety (90) days after such Change in Control,
the Option or any portion of the Option to the extent not yet exercised and the
Optionee shall be entitled to receive immediately a cash payment in an amount
equal to the excess, if any, of (A) the Fair Market Value, on the date of
surrender, of the Shares subject to the Option or portion of the Option
surrendered, over (B) the aggregate purchase price for such surrendered Shares.
8. Nontransferability.
The Option shall not be transferable other than by will or by
the laws of descent and distribution or pursuant to a domestic relations order
(as contemplated by the Plan). The Option shall be exercisable only by the
Optionee or the Optionee's guardian or legal representative during the lifetime
of the Optionee.
9. No Right to Continued Employment.
Nothing in this Agreement or the Plan shall be interpreted or
construed to confer upon the Optionee any right with respect to continuance of
employment by the Company, nor shall this Agreement or the Plan interfere in any
way with the right of the Company to terminate the Optionee's employment at any
time.
10. Adjustments.
In the event of a Change in Capitalization, the Committee may
make appropriate adjustments to the number and class of Shares or other stock or
securities subject to the Option and the purchase price for such Shares or other
stock or securities. The Committee's adjustment shall be made in accordance with
the provisions of Section 12 of the Plan and shall be effective and final,
binding and conclusive for all purposes of the Plan and this Agreement.
11. Effect of a Merger, Consolidation or Liquidation.
Subject to Section 7 hereof, upon the effective date of (i)
the liquidation or dissolution of the Company or (ii) a merger or consolidation
of the Company (a "Transaction"), the Option shall continue in effect in
accordance with its terms and the Optionee shall be entitled to receive in
respect of all Shares subject to the Option, upon exercise of the Option, the
same number and kind of stock, securities, cash, property or other consideration
that each holder of Shares was entitled to receive in the Transaction.
12. Withholding of Taxes.
The Company shall have the right to deduct from any
distribution of cash to the Optionee an amount equal to the federal, state and
local income taxes and other amounts as may be required by law to be withheld
(the "Withholding Taxes") with respect to the Option. If the Optionee is
entitled to receive Shares upon exercise of the Option, the Optionee shall pay
the Withholding Taxes to the Company in cash prior to the issuance of such
Shares. In satisfaction of the Withholding Taxes, the Optionee may make a
written election (the "Tax Election") to have withheld a portion of the Shares
issuable to him or her upon exercise of the Option, having an aggregate Fair
Market Value, on the day preceding the date of such issuance, equal to the
Withholding Taxes.
13. Optionee Bound by the Plan.
The Optionee hereby acknowledges receipt of a copy of the Plan
and agrees to be bound by all the terms and provisions thereof.
14. Modification of Agreement.
This Agreement may be modified, amended, suspended or
terminated, and any terms or conditions may be waived, but only by a written
instrument executed by the parties hereto.
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15. Severability.
Should any provision of this Agreement be held by a court of
competent jurisdiction to be unenforceable or invalid for any reason, the
remaining provisions of this Agreement shall not be affected by such holding and
shall continue in full force in accordance with their terms.
16. Governing Law.
The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of Delaware without
giving effect to the conflicts of laws principles thereof.
17. Successors in Interest.
This Agreement shall inure to the benefit of and be binding
upon any successor to the Company. This Agreement shall inure to the benefit of
the Optionee's legal representatives. All obligations imposed upon the Optionee
and all rights granted to the Company under this Agreement shall be final,
binding and conclusive upon the Optionee's heirs, executors, administrators and
successors.
18. Resolution of Disputes.
Any dispute or disagreement which may arise under, or as a
result of, or in any way relate to, the interpretation, construction or
application of this Agreement shall be determined by the Committee. Any
determination made hereunder shall be final, binding and conclusive on the
Optionee and Company for all purposes.
19. Shareholder Approval.
The effectiveness of this Agreement and of the grant of the
Option pursuant hereto is subject to the approval of the Plan by the
stockholders of the Company in accordance with the terms of the Plan.
PLAINS RESOURCES INC.
By:
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Xxxx X. (Xxxxx) Xxxxxx, Vice President
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Name of Optionee: FIELD (First Name) FIELD (Last Name)
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