EXHIBIT 4.5A
AWARD AGREEMENT UNDER
CROSS TIMBERS OIL COMPANY
1998 STOCK INCENTIVE PLAN
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THIS AGREEMENT is entered into this ______ day of ______, 1998, between
Cross Timbers Oil Company, a Delaware corporation (herein called "Company"), and
_____________ (herein called "Grantee"), pursuant to the provisions of the Cross
Timbers Oil Company 1998 Stock Incentive Plan (herein called the "Plan"). The
Compensation Committee of the Board of Directors of the Company has determined
that Grantee is eligible to be a participant in the Plan and, to carry out its
purposes, has this day autho rized the grant, pursuant to the Plan, of the
options set forth below to Grantee.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties do hereby agree as follows:
1. GRANT OF OPTIONS. Subject to all of the terms, conditions, and
provisions of the Plan and of this Agreement, the Company hereby grants to
Grantee options pursuant to which Grantee shall have the right and option under
the Plan to purchase from the Company all or any part of an aggregate of _____
shares of the common stock of the Company, of the par value of one cent ($0.01)
per share ("Common Stock"), which shares shall consist of authorized but
unissued shares or issued shares reacquired by the Company. Such options are
not intended to be Incentive Stock Options, as defined in the Plan.
2. OPTION PRICE. The option or purchase price payable by Grantee to the
Company in exercise of this option shall be $_____ per share, being the fair
market value
of the Common Stock of the Company on this date (the "Grant Date") as determined
according to the Plan. Upon exercise of this option, Grantee must pay to the
Company, in full, the option price for the shares of Common Stock issuable
pursuant to such exercise with cash. Grantee may also pay to the Company, in
full, the option price with Common Stock owned by Grantee on the date of
exercise or Common Stock acquired pursuant to such exercise, provided that
Grantee provides satisfactory evidence, in the opinion of the Secretary or any
Assistant Secretary of the Company, that Grantee directly owns or owns through a
brokerage account on the date of exercise shares of Common Stock sufficient to
pay the option price, and that the Grantee has owned such shares for six months
or more (such Common Stock being valued at fair market value on the date of such
exercise).
3. EXERCISE PERIOD.
(a) One-fifth of the options granted on a Grant Date will become
exercisable on each of the first, second, third, fourth, and fifth
anniversaries of such Grant Date. Alternatively, one-half of the
total number of options granted will become exercisable when the
Common Stock closes on the New York Stock Exchange at or above $______
per share. If the Common Stock closes on the New York Stock Exchange
at or above $______ per share, then the remaining options granted will
become exercisable. If the Common Stock is not listed on the New York
Stock Exchange, then any reference in this Agreement to the New York
Stock Exchange will be deemed to be the principal securities exchange
on which the Common Stock is traded.
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(b) The right to exercise options will be cumulative. An option must be
exercised in multiples of 10% of the options then exercisable.
(c) Any options which remain unexercised on the tenth anniversary of the
Grant Date will expire.
(d) Options may be exercised only if the Common Stock is duly registered
under the Securities Act of 1933 and applicable state securities laws,
or unless the issuance is exempt from such registrations.
4. NO EMPLOYMENT COMMITMENT. Grantee acknowledges that neither the grant
of options nor the execution of this Agreement by the Company shall be
interpreted or construed as imposing upon the Company an obligation to retain
Grantee's services for any stated period of time, which employment shall
continue to be at the pleasure of the Company at such compensation as it shall
determine, unless otherwise provided in a written employment agreement.
5. GRANTEE'S AGREEMENT. Grantee expressly and specifically agrees that:
(a) With respect to the calendar year in which such options are exercised,
Grantee shall include in his gross income for federal income tax
purposes the amount, if any, by which the fair market value of the
stock on the date of exercise, as determined in Section 6.7(d) of the
Plan, exceeds the option price;
(b) The grant of options is special incentive compensation which shall not
be taken into account as "wages" or "salary" in determining the amount
of
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payment or benefit to Grantee under any pension, thrift, stock, or
deferred compensation plan of the Company; and
(c) In behalf of Grantee's beneficiary, such grant shall not affect the
amount of any life insurance coverage available to such beneficiary
under any life insurance plan covering employees of the Company or any
subsidiary.
6. OTHER TERMS, CONDITIONS, AND PROVISIONS. As previously provided, the
options herein granted by the Company to Grantee are granted subject to all of
the terms, conditions, and provisions of the Plan. Grantee hereby acknowledges
receipt of a copy of the Plan certified by the Secretary of the Company, and the
parties agree that the entire text of such Plan be, and it is hereby
incorporated herein by reference as fully as if copied herein in full.
Reference to such Plan is therefore made for a full description of the rights
and methods of exercise of the options, the effect of Grantee's termination of
employment, the adjustments to be made in the event of changes in the capital
structure of the Company, and of all of the other provisions, terms, and
conditions of the Plan applicable to the options granted herein. If any of the
provisions of this Agreement shall vary from or be in conflict with the Plan,
the provisions of the Plan will be controlling.
7. TRANSFERABILITY. The options granted hereunder are not transferable
or assignable by Grantee except by will or the laws of descent and distribution.
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IN WITNESS WHEREOF, this Agreement is executed and entered into effective
on the day and year first above expressed.
ATTEST: CROSS TIMBERS OIL COMPANY
By:
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Xxxxxxxx Xxxxxxxx, Name: Xxx X. Xxxxxxx
Secretary Title: Chairman of the Board and
Chief Executive Officer
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