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EXHIBIT 99.3
PETROLITE CORPORATION
STOCK OPTION AGREEMENT
(Non-Qualified)
AGREEMENT made as of the 11th day of August, 1995, by and between
Petrolite Corporation, a Delaware Corporation, 000 Xxxxxxxx Xxxxxx, Xx. Xxxxx,
Xxxxxxxx 00000 (hereinafter the "Company") and Xxxx X. Xxxxxxxx, 00000
Xxxxxxxxxxx Xxxxx, Xxxxx 000, Xx. Xxxxx, Xxxxxxxx 00000 (hereinafter the
"Optionee").
WITNESSETH:
A. The Company and the Optionee have entered into that certain
Management Agreement of even date (the "Management Agreement") pursuant to
which Optionee is to render valuable services to the Company.
B. In consideration for the services to be provided by Optionee
pursuant to the Management Agreement the Company desires to grant, and the
Optionee desires to receive, an option to purchase shares of the Company's
Capital Stock.
NOW, THEREFORE, it hereby is agreed as follows:
1. Grant of Option. Subject to and upon the terms and conditions set
forth in this Agreement, the Company hereby grants to Optionee, as of the date
of this Agreement (the "Grant Date"), the right and option to purchase up to
36,000 shares of the Company's Capital Stock (the "Optioned Shares") from time
to time during the option term at the price of $21.0281 per share (the "Option
Price"). The Option Price is 75% of the average of the mid-point between the
bid and asked price for a share of the Company's Capital Stock at the close of
trading on the first five trading days of August, 1995, as reported by the
National Association of Securities Dealers, Inc.
2. Option Term. The Option shall have a maximum term of five (5)
years, measured from the Grant Date and shall accordingly expire at the close
of business on August 11, 2000 (the "Expiration Date"), unless terminated
sooner as provided in this Agreement.
3. Option Nontransferable; Exception. The Option shall be neither
transferable nor assignable by Optionee other than by will or by the laws of
descent and distribution and may be exercised, during Optionee's lifetime, only
by Optionee.
4. Exercise of Option.
a. This Agreement is made pursuant to the Management Agreement.
Subject to the right of either party to terminate the Management
Agreement earlier, the Option granted hereunder shall become exercisable
with respect to 1/12 of the shares subject thereto on and after
September 29, 1995, and with
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respect to an additional 1/12 of the shares subject thereto on and after
the last business day of each succeeding calendar month; except that,
the final 1/12 shall become exercisable on and after August 10, 1996. In
the event the Management Agreement is terminated before the Option has
become fully exercisable, the Option shall be and remain exercisable
only with respect to those shares for which the Option became
exercisable before termination of the Management Agreement.
b. To the extent that it becomes exercisable, the Option may be
exercised by Optionee at any time during the Option Term. In the event
of the death of the Optionee during the Option Term, the Option may be
exercised by his executors, administrators, or other legal
representatives, heirs, legatees, next of kin, or distributees, within
three months, but not later than three months, after the date of the
legal qualification of the executors or administrators of his estate,
provided diligent efforts are made and such qualification is obtained
within a reasonable time after his death. Notwithstanding anything in
this Agreement to the contrary, the Option granted to Optionee shall in
no event be exercisable after the Expiration Date.
5. Adjustments in Option Shares.
a. In the event any change is made to the Capital Stock issuable
hereunder by reason of any stock split, stock dividend, combination of
shares, or other change affecting the outstanding Capital Stock as a
class without receipt of consideration, the appropriate adjustments will
be made to (1) the total number of Optioned Shares subject to this
Option and/or (ii) the Option Price payable per share in order to
reflect such change and thereby preclude a dilution or enlargement of
benefits hereunder.
b. If the Company is the surviving entity in any merger or other
business combination, then this Option, if outstanding immediately after
such merger or other business combination, shall be appropriately
adjusted to apply and pertain to the number and class of securities
which would be issuable to the Optionee on the consummation of such
merger or business combination if the Option were exercised immediately
prior to such merger or business combination, and appropriate
adjustments also shall be made to the Option Price payable per share,
provided the aggregate Option Price payable hereunder shall remain the
same.
6. Right as Shareholder. The Optionee shall not have any of the rights
of a shareholder with respect to the Optioned Shares until the Optionee shall
have exercised the Option and paid the Option Price.
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7. Manner of Exercising Option.
a. In order to exercise the Option with respect to all or any part
of the Optioned shares for which the Option is at the time exercisable,
Optionee (or in the case of exercise after Optionee's death, the
Optionee's executor, administrator heir or legatee, as the case may be)
must take the following actions:
(i) Execute and deliver written notice of such exercise to
the Company;
(ii) Pay the aggregate Option Price for the purchased shares
in cash;
(iii) Furnish to the Company appropriate documentation that
the person or persons exercising the Option, other than the
Optionee, have the right to exercise the Option.
b. The Option shall be deemed to have been exercised with respect
to the number of Optioned Shares specified in the notice when the notice
shall have been delivered to the Company as provided herein. Payment of
the Option Price shall become due immediately and shall accompany the
notice. As soon as practical thereafter, the Company shall mail or
deliver to Optionee, or to the other person or persons exercising this
Option, a certificate or certificates representing the Optioned Shares
so purchased and paid for, with any appropriate legends affixed thereto.
c. In no event may this Option be exercised for any fractional
shares.
8. Compliance with Laws and Regulations.
a. The exercise of this Option and the issuance of Optioned
Shares upon such exercise shall be subject to compliance by the Company
and the Optionee with all applicable requirements of law relating
thereto and with all applicable regulations of any stock exchange or
trading system on which shares of the Company's Capital Stock may be
listed at the time of such exercise and issuance.
b. In connection with the exercise of this Option, Optionee shall
execute and deliver to the Company such representations in writing as
may be requested by the Company in order for it to comply with the
applicable requirements of federal and state securities laws.
c. Optionee is familiar with the Company and has obtained such
financial and other information concerning the
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Company as Optionee deems necessary to make an informed decision
regarding any exercise of the Option granted herein.
d. Any shares acquired hereunder shall be acquired for Optionee's
own account without a view to the distribution thereof within the
meaning of the United States Securities Act of 1933, as amended (the
"Securities Act"), and the rules and regulations thereunder.
9. Restrictions on Transfers of Optioned Shares. Optionee understands
and agrees that, unless and until the Optioned Shares are registered under the
Securities Act, the Optionee will not offer, sell or otherwise dispose of all
or any part of the Optioned Shares to any person unless, in the opinion of
counsel satisfactory to Petrolite, an exemption from such registration
requirements is available. Optionee further agrees that a legend to the
foregoing effect may be placed upon any certificate or other documents issued
representing the Optioned Shares, and the records of Petrolite may be marked to
indicate the restrictions on transfer. On the written request of the Optionee,
Petrolite will remove the legend from the certificate or other documents issued
representing the Optioned Shares if, in the opinion of Petrolite's securities
counsel, the shares may be transferred freely without registration.
10. Right to Registration.
a. The Optionee, upon written request at any time from the Grant
Date through the Expiration Date, may make one demand requesting that
the Company use its reasonable best efforts to effect the registration
under the Securities Act of all or part of the Optioned Shares then held
by the Optionee. Registration requested pursuant to this Section 10
shall be effected by the filing of a registration statement on the
appropriate registration form, as determined by the Company.
b. In connection with its obligations hereunder, the Company shall
file such prospectuses, exhibits, undertakings, and other certificates
and instruments with the Securities and Exchange Commission (the "SEC")
as may be requested or required by the SEC or its staff, and shall file
such pre-effective amendments to its registration statement as may be
required to obtain the declaration of effectiveness. The Company shall
have the right to postpone for up to six months any registration
hereunder if, in the good faith opinion of the Company, such
registration would interfere with any material transaction then being
pursued by the Company or otherwise would adversely affect the Company
in any material way. Anything herein to the contrary notwithstanding,
the Company shall not be required to file any registration statement
hereunder if, in the opinion of the Company's counsel, the Optioned
Shares proposed to be registered may be sold freely without such
registration.
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c. All costs and expenses of every kind relating to or arising
from the preparation and filling of a registration statement,
amendments, supplements, prospectuses, exhibits, undertakings and
other documents shall be paid by the Company; provided, however, that
the Company shall not be required to pay the fees and expenses of
counsel for the Optionee or any underwriting discounts, commission or
transfer taxes.
d. Before the effective date of the registration statement
specified herein, the Company and the Optionee shall enter into an
agreement providing for a reciprocal indemnification against any losses,
claims, damages or liabilities to which the Optionee or the Company may
become subject under the Securities Act or otherwise, in the form of the
reciprocal indemnification provisions with respect to materials provided
by them, respectively, for inclusion in the type of statement that
customarily appears in underwriting agreements used by reputable
investment bankers.
11. Company's Right to Repurchase. Notwithstanding the foregoing, upon
the written request of the Optionee requesting that the Company effect the
registration under the Securities Act of all or part of the Optioned Shares, the
Company may, in lieu of using its best efforts to effect the registration of
such Optioned Shares under the Securities Act, repurchase all or any portion of
the Optioned Shares to be so registered at the current market value of the
Optioned Shares, which shall be determined by using the average of the daily
average of the bid and asked price for a share of the Company's Capital Stock at
the close of trading on the twenty (20) days immediately following the date of
such request for registration, as reported by the National Association of
Securities Dealers, Inc. If the Company elects to repurchase all or a portion of
the Optioned Shares, the Company shall pay cash for such Optioned Shares to be
repurchased within twenty (20) business days after notice to the Optionee of the
Company's election to repurchase such Optioned Shares, which election shall be
made within twenty (20) days after receipt by the Company of the Optionee's
written request.
12. Successors and Assigns. Except to the extent otherwise provided
herein, the provisions of this Agreement shall inure to the benefit of, and be
binding upon, the successors, administrators, heirs, legal representatives and
assigns of the Optionee and the successors and assigns of the Company.
13. Notices. Any notice required to be given or delivered to the
Company under the terms of this Agreement shall be in writing and addressed to
the Company in care of its Secretary at its corporate offices. Any notice
required to be given or delivered to Optionee shall be in writing and addressed
to Optionee at the address indicated above. All notices shall be deemed to have
been given or delivered upon personal delivery or upon depositing in the
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U.S. mail, postage prepaid and properly addressed to the party to be notified.
14. Applicable Law. The interpretation, performance and enforcement of
this Agreement shall be governed by the laws of the State of Missouri.
15. Nonstatutory Stock Option. The Option is intended not to qualify
as an incentive stock option within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, and shall be so construed.
16. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
in duplicate on its behalf by its duly authorized officer, and Optionee also has
executed this Agreement in duplicate, all as of the day and year indicated
above.
Company: PETROLITE CORPORATION
By: /s/ XXXXXXX X. XXXXXX
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(Signature)
Chairman, President and Chief Executive Officer
-----------------------------------------------
(Title)
Optionee: XXXX X. XXXXXXXX
/s/ XXXX X. XXXXXXXX
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(Signature)
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TERMINATION AGREEMENT
This Termination Agreement entered into as of the 20th day of
November, 1995, by and between Petrolite Corporation, a Delaware Corporation,
000 Xxxxxxxx Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000 (the "Company"), and Xxxx X.
Xxxxxxxx, 00000 Xxxxxxxxxxx Xxxxx, Xxxxx 000, Xx. Xxxxx, Xxxxxxxx 00000 ("Xx.
Xxxxxxxx").
WITNESSETH:
WHEREAS, the Company and Xx. Xxxxxxxx entered into that certain
Management Agreement dated as of the 11th day of August, 1995 pursuant to which
the Company engaged the services of Xx. Xxxxxxxx (the "Management Agreement"),
a copy of which is attached hereto as Exhibit A; and
WHEREAS, pursuant to the Management Agreement, the Company and Xx.
Xxxxxxxx entered into that certain Stock Option Agreement dated as of the 11th
day of August pursuant to which the Company granted, and Xx. Xxxxxxxx received,
an option to purchase shares of the Company's Capital Stock (the "Stock Option
Agreement"), a copy of which is attached hereto as Exhibit B; and
WHEREAS, Xx. Xxxxxxxx has become an employee of the Company and,
therefore, Xx. Xxxxxxxx and the Company mutually desire to terminate both the
Management Agreement and the Stock Option Agreement.
NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein, the parties hereto agree as follows:
1. The Management Agreement is terminated effective November 20,
1995. Each of the parties releases and forever discharges the other from any
and all agreements, undertakings, obligations, duties, demands and/or claims
arising out of or in connection with the Management Agreement and the parties'
performance or lack of performance thereof; except that, neither party shall be
relieved of its liabilities or obligations arising from or incident to services
performed by Manager prior to November 20, 1995.
2. The Stock Option Agreement is terminated effective November
20, 1995. The option granted under the Stock Option
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Agreement became exercisable with respect to 6,000 shares prior to termination
of the Stock Option Agreement and, accordingly, the option shall be and remain
exercisable according to the terms of the Stock Option Agreement only with
respect to said 6,000 shares, subject to adjustment as provided in the Stock
Option Agreement.
3. This Termination Agreement and all matters pertaining hereto
or arising herefrom shall be governed and determined by the laws of the State
of Missouri.
4. This Termination Agreement supersedes all prior negotiations,
understandings and agreements between the parties regarding the subject matter
hereof and constitutes the entire understanding and agreement between the
parties with respect to the subject matter hereof. No alterations,
modifications or changes to this Agreement shall be effective unless the same
are in writing and executed by both parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date shown above.
Company: PETROLITE CORPORATION
By: /s/ Xxxx X. Xxxxxxxxx
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(Signature)
Chairman of the Compensation Committee
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(Title)
Manager: XXXX X. XXXXXXXX
By: /s/ Xxxx X. Xxxxxxxx
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(Signature)
Chairman, President and
Chief Executive Officer
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(Title)
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