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EXHIBIT 4.2
STOCK OPTION AWARD AGREEMENT
Under the Xxxxxx Drilling Company
Amended and Restated 1997 Stock Plan
THIS STOCK OPTION AWARD AGREEMENT (this "Agreement") is made and
entered into as of by and between Xxxxxx Drilling Company, a Delaware
corporation ("Xxxxxx"), and the below named individual ("Participant").
R E C I T A L S
WHEREAS, in consideration of the presently existing relationship
between the Company and the Participant, and as an additional inducement to
provide employees, directors or consultants who are in a position to contribute
to the growth, management and success of the business of the Company and its
subsidiaries, it is agreed between the Company and Participant as follows:
1. Defined Terms. As used herein, the following terms shall have the
following meanings:
(a) "Plan" shall mean the Xxxxxx Drilling Company 1997 Stock Plan,
including any amendments thereto.
(b) "Participant" shall mean .
(c) "Option Shares" shall mean shares of the Common Stock of the
Company, par value 16-2/3 cents per share.
(d) "Expiration Date" shall mean .
(e) "Board" shall mean the Board of Directors of Xxxxxx.
Any other capitalized terms used herein shall be defined in accordance
with the definitions in the Plan.
2. Option Grant. The Company hereby grants to Participant, subject to
the terms hereof and the terms of the Plan, the right and option to purchase all
or any part of the Option Shares on or before the Expiration Date (the
"Option"); provided, however, that the Option shall mature and become
exercisable as incentive stock options, subject to the $100,000 monetary limit
as follows: [vesting provisions relating to award included here]. No exercise as
to a portion of the Option Shares shall preclude a later exercise or exercises
as to additional portions. Further, the Option shall be exercisable upon vesting
only (a) as provided in paragraph 3(b) hereof, (b) during such time as
Participant remains an employee, director or consultant of the Company, (c) in
the event of disability (for
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purposes of this Agreement, Participant shall be considered disabled if he/she
is unable to engage in substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted or can be expected to last for a continuous period of
not less than 12 months) during employment, until the earlier of the Expiration
Date or one year after commencement of Participant's disability, (d) in the
event of death during employment, until the earlier of the Expiration Date or
one year after Participant's death, or (e) as otherwise provided in the Plan.
3. Terms and Conditions of the Option. The Option shall be subject to
the following terms and conditions:
(a) Option Price. The price to be paid for each of the Option Shares
with respect to which the Option is exercised, shall be $ (the "Option
Price").
(b) Exercise of Option. The option to purchase the Option Shares shall
be exercisable as specified herein and in the Plan. Payment of the Option
Price for the number of shares as to which the option is being exercised
may be paid (i) in cash, (ii) in shares of Common Stock held by the
Participant having an aggregate Fair Market Value, as determined as of the
close of business on the day on which such Option is exercised, equal to
the Option Price, (iii) if permitted by the Board, by delivery of
Participant's promissory note in the amount of the Option Price, which note
shall provide for full personal liability and contain such terms and
provisions as the Board may determine, including without limitation the
right to repay the note partially or wholly with Common Stock, (iv) by
delivery of irrevocable instructions to a broker to promptly deliver to the
Company the amount of sale or loan proceeds necessary to pay for all Common
Stock acquired through such exercise and any tax withholding obligations
resulting from such exercise, (v) if permitted by the Board, by the
withholding by the Company, pursuant to a written election delivered by the
Participant to the Administrator of the Plan on or prior to the date of
exercise, from the shares of Common Stock issuable upon any exercise of the
Option that number of shares having a Fair Market Value as of the close of
business on the day prior to the day on which such Option is exercised
equal to such Option Price, (vi) if permitted by the Board, by constructive
delivery of shares of Common Stock held by the Participant having an
aggregate Fair Market Value, as determined as of the close of business on
the day of exercise, equal to the Option Price effected through providing
the Company with a notarized statement on or before the day of exercise
attesting to the number of shares owned by the Participant that will serve
as the Option Price payment shares, or (vii) by a combination of such
methods. The option shall not be exercisable with respect to fractions of a
share.
(c) Notice of Exercise. Each exercise of the Option shall be by written
notice to the Company. Each such notice shall state the number of Option
Shares with respect to which the Option is being exercised and shall
specify a date, not less than
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five nor more than ten days after the date of such notice, as the date on
which the shares will be delivered and payment made therefor at the
principal offices of the Company. If any law or regulation requires the
Company to take any action with respect to the shares specified in such
notice, then the date for delivery of such shares against payment therefor
shall be extended for the period necessary to take such action. In the
event of any failure to pay for the number of shares specified in such
notice on the date set forth therein, subject to such date being extended
as provided above, the Option shall terminate with respect to such number
of shares, but shall continue with respect to the remaining shares covered
by this Agreement and not yet acquired by exercise of the Option or any
portion thereof.
(d) Investment Representation. If shares of stock issued pursuant to
exercise of the Option have not been registered under the Securities Act of
1933, as amended (the "Securities Act"), Participant agrees to represent
and warrant in writing at the time of any exercise of the Option or any
portion thereof that the Option Shares are being purchased only for
investment and without any present intention to sell or distribute such
shares, and further agrees that shares so acquired may be appropriately
legended and will be sold or transferred only in accordance with the rules
and regulations of the Securities and Exchange Commission (the "SEC") or
any applicable law, regulation, or rule of any governmental agency.
(e) Taxes. Participant shall pay all original issue or transfer taxes
and all other fees and expenses incident to the issue, transfer, or
delivery of Option Shares.
(f) Nonassignability. The Option shall be exercisable during
Participant's lifetime only by Participant, and shall not be assigned,
transferred, pledged, hypothecated, sold or otherwise disposed of, in whole
or in part, voluntarily or involuntarily, any such assignment, transfer,
pledge, hypothecation, sale or other disposition being void and of no
effect; provided, however, that the Option shall be transferable by will or
the laws of descent and distribution.
(g) No Rights Until Issue. No right to vote or receive dividends or any
other rights as a stockholder of the Company shall exist with respect to
the Option Shares, notwithstanding the exercise of the Option, until the
issuance to the Participant of a stock certificate or certificates
representing such shares.
(h) Anti-dilution. In the event of a merger, consolidation,
reorganization, recapitalization, stock dividend, stock split or other
change in the corporate structure or capitalization of the Company, the
number of Option Shares and the Option Price shall be subject to
appropriate adjustments as described in the Plan.
The Option is also subject to, and, by accepting and executing this Agreement,
Participant agrees to be bound by, all of the terms, provisions, limitations and
conditions of the Plan.
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4. Incentive Stock Option. To the extent specified in paragraph 2
above, the Option is intended to qualify as an "incentive stock option" as such
term is defined at section 422 of the Internal Revenue Code of 1986, as amended;
provided, however, Participant acknowledges and understands that the status of
the Option as an "incentive stock option" depends on various factors relating to
the Plan, the Option and the grant thereof (including the Option Price of the
Option and the approval of shareholders for the options to qualify under section
422), and that the Option may be determined not to qualify as an "incentive
stock option."
5. Cancellation or Reduction. The Board may elect to cancel the Option
or reduce the number of Option Shares at any time prior to the exercise of the
Option, as described in the Plan.
6. The Plan. Participant acknowledges receipt of a copy of the Plan and
represents that he/she is familiar with the terms and provisions thereof and
hereby accepts the Option subject to all such terms and provisions.
7. Relationship. Nothing in the Plan or in this Agreement shall confer
upon Participant any right to continued relationship as an employee, director or
consultant of the Company or interfere in any way with the right of the Company
to terminate Participant's relationship at any time.
8. Binding Agreement. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, trustees, successors and assigns.
EXECUTED as of the day and year first above written.
Xxxxxx Drilling Company Participant
By: By:
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Name: Name:
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Title:
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