NON-STATUTORY STOCK OPTION AGREEMENT Optionee: Keith Klopfenstein
Exhibit 10.3
T-3 ENERGY SERVICES, INC.
Optionee: Xxxxx Xxxxxxxxxxxx
1. Grant of Stock Option. As of the Grant Date
(identified in Section 18 below), T-3 Energy Services, Inc., a Delaware corporation (the
“Company”), hereby grants a Nonstatutory Stock Option (the “Option”) to the Optionee (identified
above), an employee of the Company, to purchase the number of shares of the Company’s common stock,
$.001 par value per share (the “Common Stock”) identified in Section 18 below (the
“Shares”), subject to the terms and conditions of this agreement (the “Agreement”) and the T-3
Energy Services 2002 Stock Incentive Plan (the “Plan”). The Plan is hereby incorporated herein in
its entirety by reference. The Shares, when issued to Optionee upon the exercise of the Option,
shall be fully paid and nonassessable. The Option is not an “incentive stock option” as defined in
Section 422 of the Internal Revenue Code.
2. Definitions. All capitalized terms used herein shall have the meanings set forth in
the Plan unless otherwise provided herein. Section 18 sets forth meanings for certain of
the capitalized terms used in this Agreement.
3. Option Term. The Option shall commence on the Grant Date (identified in
Section 18 below) and terminate on the tenth (10th) anniversary of the Grant Date as
specified in Section 18. The period during which the Option is in effect and may be
exercised is referred to herein as the “Option Period”.
4. Option Price. The Option Price per Share is identified in Section 18.
5. Vesting. The total number of Shares subject to this Option shall vest in
accordance with the Vesting Schedule (described in Section 18). The Shares may be
purchased at any time after they become vested, in whole or in part, during the Option Period;
provided, however, the Option may only be exercisable to acquire whole Shares. The right of
exercise provided herein shall be cumulative so that if the Option is not exercised to the maximum
extent permissible after vesting, the vested portion of the Option shall be exercisable, in whole
or in part, at any time during the Option Period.
6. Method of Exercise. The Option is exercisable by delivery of a written notice to
the Secretary of the Company, signed by the Optionee, specifying the number of Shares to be
acquired on, and the effective date of, such exercise. The Optionee may withdraw notice of
exercise of this Option, in writing, at any time prior to the close of business on the business day
preceding the proposed exercise date.
7. Method of Payment. Subject to applicable provisions of the Plan, the Option Price
upon exercise of the Option shall be payable to the Company in full either: (i) in cash or its
equivalent; (ii) subject to prior approval by the Committee in its discretion, by tendering
previously acquired Shares having an aggregate Fair Market Value (as defined in the Plan) at the
time of exercise equal to the total Option Price (provided that the Shares must have been held by
the
Optionee for at least six (6) months prior to their tender to satisfy the Option Price); (iii)
subject to prior approval by the Committee in its discretion, by withholding Shares which otherwise
would be acquired on exercise having an aggregate Fair Market Value at the time of exercise equal
to the total Option Price; or (iv) any other permitted method pursuant to the applicable terms and
conditions of the Plan.
As soon as practicable after receipt of a written notification of exercise and full payment,
the Company shall deliver to or on behalf of the Optionee, in the name of the Optionee or other
appropriate recipient, Share certificates or other evidence of ownership for the number of Shares
purchased under the Option.
8. Restrictions on Exercise. The Option may not be exercised if the issuance of such
Shares or the method of payment of the consideration for such Shares would constitute a violation
of any applicable federal or state securities or other laws or regulations, or any rules or
regulations of any stock exchange on which the Common Stock may be listed. In addition, Optionee
understands and agrees that the Option cannot be exercised if the Company determines that such
exercise, at the time of such exercise, will be in violation of the Company’s xxxxxxx xxxxxxx
policy.
9. Termination of Employment. Voluntary or involuntary termination of Employment
shall affect Optionee’s rights under the Option as follows:
(a) Termination for Cause. The entire Option, including any vested portion
thereof, shall expire on 12:01 a.m. (CST) on the date of termination of Employment and shall
not be exercisable to any extent if Optionee’s Employment is terminated for Cause (as
defined in the Plan at the time of such termination of Employment).
(b) Retirement. If Optionee’s Employment is terminated for Retirement on or
after Optionee attains the age of 65, then (i) the non-vested portion of the Option shall
immediately expire on the termination date and (ii) the vested portion of the Option shall
expire to the extent not exercised before the six (6) month anniversary of the date of such
termination of Employment. In no event may the Option be exercised after the earlier of (i)
the expiration of the Option Period or (ii) six months from the date of termination of
Employment due to Retirement even if Optionee becomes deceased during such period.
(c) Death or Disability. If Optionee’s Employment is terminated by death or
Disability (as defined in the Plan at the time of such termination of Employment), then (i)
the non-vested portion of the Option shall immediately expire on the date of termination of
Employment and (ii) the vested portion of the Option shall expire on the one year
anniversary date of the termination of Employment date (to the extent not exercised by
Optionee) or, in the case of death, by the person or persons to whom Optionee’s rights under
the Option have passed by will or by the laws of descent and distribution or, in the case of
Disability, by Optionee or Optionee’s legal representative. In no event may the Option be
exercised by anyone on or after the earlier of (i) the expiration of the Option Period or
(ii) one year after the date of Optionee’s death or termination of Employment due to
Disability.
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(d) Other Involuntary Termination or Voluntary Termination. If Optionee’s
Employment is terminated for any reason other than for Cause, Retirement, death or
Disability, then (i) the non-vested portion of the Option shall immediately expire on the
termination of Employment date and (ii) the vested portion of the Option shall expire to the
extent not exercised within 90 calendar days after such termination date. In no event may
the Option be exercised by anyone after the earlier of (i) the expiration of the Option
Period or (ii) 90 calendar days after the termination of Employment date even if Optionee
becomes deceased during such period.
10. Independent Legal and Tax Advice. Optionee acknowledges that the Company has
advised Optionee to obtain independent legal and tax advice regarding the grant and exercise of the
Option and the disposition of any Shares acquired thereby.
11. Reorganization of Company. The existence of the Option shall not affect in any
way the right or power of the Company or its stockholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes in
Company’s capital
structure or its business, or any merger or consolidation of the Company, or any issue of bonds,
debentures, preferred or prior preference stock ahead of or affecting the Shares or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any
part of its assets or business, or any other corporate act or proceeding, whether of a similar
character or otherwise.
12. Adjustment of Shares. In the event of stock dividends, spin-offs of assets or
other extraordinary dividends, stock splits, combinations of shares, recapitalizations, mergers,
consolidations, reorganizations, liquidations, issuances of rights or warrants and similar
transactions or events involving Company, appropriate adjustments shall be made to the terms and
provisions of the Option as provided in the Plan.
13. No Rights in Shares. Optionee shall have no rights as a stockholder in respect of
the Shares until the Optionee becomes the record holder of such Shares.
14. Investment Representation. Optionee will enter into such written representations,
warranties and agreements as Company may reasonably request in order to comply with any federal or
state securities law. Moreover, any stock certificate for any Shares issued to Optionee hereunder
may contain a legend restricting their transferability as determined by the Company in its
discretion. Optionee agrees that Company shall not be obligated to take any affirmative action in
order to cause the issuance or transfer of Shares hereunder to comply with any law, rule or
regulation that applies to the Shares subject to the Option.
15. No Guarantee of Employment. The Option shall not confer upon Optionee any right
to continued employment with the Company or any affiliate thereof.
16. Withholding of Taxes. The Company shall have the right to (a) make deductions
from the number of Shares otherwise deliverable upon exercise of the Option in an amount sufficient
to satisfy withholding of any federal, state or local taxes required by law, or (b) take such other
action as may be necessary or appropriate to satisfy any such tax withholding obligations.
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17. General.
(a) Notices. All notices under this Agreement shall be mailed or delivered by
hand to the parties at their respective addresses set forth beneath their signatures below
or at such other address as may be designated in writing by either of the parties to one
another, or to their permitted transferees if applicable. Notices shall be effective upon
receipt.
(b) Shares Reserved. The Company shall at all times during the Option Period
reserve and keep available under the Plan such number of Shares as shall be sufficient to
satisfy the requirements of this Option.
(c) Transferability of Option. The Option is transferable only to the extent
permitted under the Plan at the time of transfer (i) by will or by the laws of descent and
distribution, (ii) by a qualified domestic relations order (as defined in Section 414(p) of
the Internal Revenue Code), or (iii) to Optionee’s Immediate Family. No right or benefit
hereunder shall in any manner be liable for or subject to any debts, contracts, liabilities,
obligations or torts of Optionee or any permitted transferee thereof.
(d) Amendment and Termination. No amendment, modification or termination of
this Agreement shall be made at any time without the written consent of Optionee and
Company.
(e) No Guarantee of Tax Consequences. The Company makes no commitment or
guarantee that any tax treatment will apply or be available to Optionee or any other person.
The Optionee has been advised, and provided with the opportunity, to obtain independent
legal and tax advice regarding the grant and exercise of the Option and the disposition of
any Shares acquired thereby.
(f) Severability. In the event that any provision of this Agreement shall be
held illegal, invalid, or unenforceable for any reason, such provision shall be fully
severable, but shall not affect the remaining provisions of the Agreement, and the Agreement
shall be construed and enforced as if the illegal, invalid, or unenforceable provision had
not been included herein.
(g) Supersedes Prior Agreements. This Agreement shall supersede and replace
all prior agreements and understandings, oral or written, between the Company and the
Optionee regarding the grant of the Options covered hereby.
(h) Governing Law. The Option shall be construed in accordance with the laws
of the State of Delaware, without regard to its conflict of law provisions, to the extent
federal law does not supersede and preempt Delaware law.
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18. Definitions and Other Terms. The following capitalized terms shall have those
meanings set forth opposite them:
| (a) | Optionee: | Xxxxx Xxxxxxxxxxxx | ||||
| (b) | Grant Date: | January 12, 2006 | ||||
| (c) | Shares: | Twenty Five Thousand (25,000) Shares of the Company's Common Stock. | ||||
| (d) | Option Price: | $12.31 | ||||
| (e) | Option Period: | January 12, 2006 through January 12, 2016 (until 5:00 p.m. CST). | ||||
| (f) | Vesting Schedule: Options for 33% of the Shares covered by this Option shall vest on the first anniversary of the Grant Date, and Options for the remaining Shares shall vest on each subsequent anniversary of the Grant Date until fully vested, as follows: | |||||
| Date | Options Vesting | |||||||
January 12, 2007 |
33 | % | ||||||
January 12, 2008 |
33 | % | ||||||
January 12, 2009 |
34 | % | ||||||
Total |
100 | % | ||||||
In the event of a “Change in Control” of the Company (as defined in the Plan at the time of
such event), the non-vested portion of the Option shall become immediately 100% vested as of the
Change in Control date.
[Signature page follows.]
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IN WITNESS WHEREOF, the Company, as of the Grant Date, has caused this Agreement to be
executed on its behalf by its duly authorized officer and Optionee has hereunto executed this
Agreement as of the same date.
| T-3 ENERGY SERVICES, INC. | ||||
| By: | /s/ Xxx X. Xxxxx | |||
| Name: Xxx X. Xxxxx |
||||
| Title: President & CEO | ||||
| Address for Notices: | ||||
| T-3 Energy Services, Inc. | ||||
| 00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000 | ||||
| Xxxxxxx, XX 00000 | ||||
| Attn: Corporate Secretary | ||||
| OPTIONEE | ||||
| /s/ Xxxxx Xxxxxxxxxxxx | ||||
| Xxxxx Xxxxxxxxxxxx | ||||
| Address for Notices: | ||||
| T-3 Energy Services, Inc. | ||||
| 00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000 | ||||
| Xxxxxxx, XX 00000 | ||||
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