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EXHIBIT 4.7
TOREADOR ROYALTY CORPORATION
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (this "Agreement"), made and
entered into as of this 17th day of February, 1994, by and between Toreador
Royalty Corporation, a Delaware corporation (the "Company"), and Xxxxxx X.
Xxxxxxx, Xx. ("Director");
W I T N E S S E T H:
WHEREAS, Director currently serves as a Non-Employee Director of the
Company; and
WHEREAS, the Company desires to extend to Director the opportunity to
acquire Common Stock as an added incentive for Director to continue serving as
a Director of the Company and to advance the interests of the Company; and
WHEREAS, the Board of Directors of the Company (the "Board") has
authorized and approved the grant of non-qualified stock options to Director
subject to the terms and conditions herein provided; and
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound, do hereby agree as follows:
1. Grant of Option and Option Period. The Company hereby grants
to Director as of the date of this Agreement (the "Grant Date"), subject to the
provisions of Section 2 hereof and as hereinafter set forth, an option (the
"Option") to purchase 10,000 shares of Common Stock, par value $.15625 per
share, of the Company ("Common Stock") at the price of $3.625 per share, at any
time or (with respect to partial exercises) from time to time during a period
commencing on the first anniversary of the Grant Date and ending on February
17, 2004 (the "Option Period"), provided that the number of shares purchasable
hereunder in any period or periods of time during which the Option is exercised
shall be limited as follows:
(a) 3,400 shares are purchasable, in whole at any time or
in part from time to time, commencing February 17, 1995, if Director
serves as a director of the Company until that date;
(b) an additional 3,300 shares are purchasable, in whole
at any time or in part from time to time, commencing February 17,
1996, if Director serves as a director of the Company until that date;
(c) an additional 3,300 shares are purchasable, in whole
at any time or in part from time to time, commencing February 17,
1997, if Director serves as a director of the Company until that date.
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2. Termination of Service. Any provision of Section 1 hereof to
the contrary notwithstanding:
(a) If Director ceases to be a member of the Board on
account of Director's (i) fraud or intentional misrepresentation or
(ii) embezzlement, misappropriation or conversion of assets or
opportunities of the Company or any direct or indirect majority-owned
subsidiary of the Company, then the Option shall automatically
terminate and be of no further force or effect as of the date Director
ceases to be a member of the Board;
(b) If Director shall die during the Option Period while
a member of the Board, the Option may be exercised, to the extent that
Director was entitled to exercise it at the date of Director's death,
within one year after such death (if otherwise within the Option
Period), but not thereafter, by the executor or administrator of the
estate of Director or by the person or persons who shall have acquired
the Option directly from Director by bequest or inheritance; and
(c) If Director ceases to be a member of the Board for
any reason (other than the circumstances specified in paragraphs (a)
and (b) of this Section 2) within the Option Period, the Option may be
exercised, to the extent Director was able to do so at the date of
termination of the directorship, within three (3) months after such
termination (if otherwise within the Option Period), but not
thereafter.
3. Exercise During Service. Except as provided in Section 2
hereof, the Option may not be exercised unless Director is at the time of
exercise serving as a director of the company, and except as provided in
Section 2, such Option shall terminate upon termination of Director's service
as a director of the Company.
4. Agreement of Director. As consideration for the Company's
grant of the Option, Director agrees to continue to serve the Company as a
director at the pleasure of the Company's stockholders for a continuous period
of one year from the Grant Date at the retainer rate and fee schedule, if any,
in effect as of the date hereof or at such changed rate or schedule as the
Company from time to time may establish; provided, that nothing in the Plan or
in this Agreement shall confer upon Director any right to continue as a member
of the Board.
5. Exercise of Option. The Option may be exercised by written
notice signed by Director and delivered to the Secretary of the Company or sent
by United States registered or certified mail, postage prepaid, addressed to
the Company (to the attention of its Secretary) at its corporate office in
Dallas, Texas. Such notice shall state the number of shares as to which the
Option is exercised and shall be accompanied by the full amount of the purchase
price of such shares, in cash or by check. Any such notice shall be deemed
given on the date on which the same was deposited in a regularly maintained
receptacle for the deposit of United States mail, addressed and sent as
above-stated, or, in the case of hand delivery, on the date of receipt thereof
by the Secretary of the Company. Promptly after demand by the Company,
Director shall pay to the Company an amount equal to applicable withholding
taxes, if any, due in connection with
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the exercise of the Option. In the event of Director's death, the executor or
administrator of Director's estate (or anyone who shall have acquired the
Option by will or pursuant to the laws of descent and distribution) may
exercise the Option in accordance with the provisions of this Agreement.
6. Delivery of Certificates Upon Exercise of the Option.
Delivery of a certificate or certificates representing the purchased shares of
Common Stock shall be made promptly after receipt of notice of exercise and
payment of the purchase price and the amount of any withholding taxes to the
Company, if required. If the Company so elects, it obligation to deliver
shares of Common Stock upon the exercise of the Option shall be conditioned
upon its receipt from the person exercising the Option of an executed
investment letter, in form and content satisfactory to the Company and its
legal counsel, evidencing the investment intent of such person and such other
matters as the Company may reasonably require. It the Company so elects, the
certificate or certificates representing the shares of Common Stock issued upon
exercise of the Option shall bear a legend in substantially the following form:
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED UNLESS SUCH SHARES ARE FIRST REGISTERED
THEREUNDER OR UNLESS THE COMPANY RECEIVES A WRITTEN OPINION OF
COUNSEL, WHICH OPINION AND COUNSEL ARE ACCEPTABLE TO THE COMPANY, TO
THE EFFECT THAT REGISTRATION THEREUNDER IS NOT REQUIRED.
7. Adjustments Upon Changes in Common Stock. In the event that
before delivery by the Company of all the shares in respect of which the Option
is granted, the Company shall have effected a Common Stock split or dividend
payable in Common Stock, or the outstanding Common Stock of the Company shall
have been combined into a smaller number of shares, the shares still subject to
the Option shall be increased or decreased to reflect proportionately the
increase or decrease in the number of shares outstanding, and the purchase
price per share shall be decreased or increased so that the aggregate purchase
price for all the then optioned shares shall remain the same as immediately
prior to such split, dividend or combination. In the event of a
reclassification of Common Stock not covered by the foregoing, or in the event
of a liquidation, separation or reorganization, including a merger,
consolidation or sale of assets, the Board shall make such adjustments, if any,
as it may deem appropriate in the number, purchase price and kind of shares
still subject to the Option. The provisions of this Section 7 shall only be
applicable if, and only to the extent that, the application thereof does not
conflict with any valid governmental statute, regulation or rule.
8. Transferability. The Option evidenced hereby is not
transferable otherwise than by will or by the laws of descent and distribution
or pursuant to a qualified domestic relations
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order as defined in the Code or in Title I of the Employee Retirement Income
Security Act of 1974, as amended, and during the lifetime of Director is
exercisable only by Director.
9. Applicable Law. All questions arising with respect to the
provisions of this Agreement shall be determined by application of the laws of
the State of Texas except to the extent preempted by Federal law.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
The "Company"
TOREADOR ROYALTY CORPORATION
By: /s/ XXXXX X. XXX
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Xxxxx X. Xxx, Chairman
and Chief Executive Officer
"Director"
/s/ XXXXXX X. XXXXXXX, XX.
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Xxxxxx X. Xxxxxxx, Xx.
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