EXHIBIT 10.31
HOWELL CORPORATION
OMNIBUS STOCK AWARDS AND INCENTIVE PLAN
I. PURPOSE
The purpose of the HOWELL CORPORATION OMNIBUS STOCK AWARDS AND INCENTIVE
PLAN (the "Plan") is to provide a means through which HOWELL CORPORATION, a
Delaware corporation (the "Company"), and its Subsidiaries (as defined herein),
may attract able persons to enter the employ of or provide services to the
Company and its Subsidiaries and to provide a means whereby employees, officers
and consultants upon whom the responsibilities of the successful administration
and management of the Company and its Subsidiaries rest, and whose present and
potential contributions to the welfare of the Company and its Subsidiaries are
of importance, can acquire and maintain stock ownership, thereby strengthening
their concern for the welfare of the Company and its Subsidiaries and their
desire to remain in the Company's and its Subsidiaries' employ or service. A
further purpose of the Plan is to provide such individuals with additional
incentive and reward opportunities designed to enhance the profitable growth of
the Company and its Subsidiaries. Accordingly, the Plan authorizes granting
various types of Awards as is best suited to the Company and the circumstances
of the particular eligible individual.
II. DEFINITIONS
The following definitions shall be applicable throughout the Plan unless
specifically modified by any paragraph:
(a) "Affiliate[s]" means any "parent corporation" of the Company and any
"subsidiary" of the Company within the meaning of Code Sections 424(e) and (f),
respectively.
(b) "Agreement" means, individually or collectively, an Option Agreement, a
Performance Award Agreement, or a Restricted Stock Agreement.
(c) "Award" means, individually or collectively, an Option, a Restricted
Stock Award, or a Performance Award.
(d) "Board" means the Board of Directors of the Company.
(e) "Change of Control" means the occurrence of any of the following
events: (i) a change in control is reported by the Company in response to Item 1
of Form 8-K (or any successor item of Form 8-K or any similar item of any other
report required to be filed by the Company under the 1934 Act); (ii) any
"person" (as such term is used in Sections 13(d) and 14(d)(2) of the Exchange
Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing
forty percent or more of the combined voting power of the Company's then
outstanding securities; or (iii) following the election or removal of directors,
a majority of the Board consists of individuals who were not members of the
Board two years before such election or removal, unless the election of each
director who was not a director at the beginning of such two-year period has
been approved in advance by directors representing at least a majority of the
directors then in office who were directors at the beginning of the two-year
period.
(f) "Change of Control Value" shall mean (i) the per share price offered to
shareholders of the Company in any merger, consolidation, reorganization, sale
of assets or dissolution transaction involving the Company, (ii) the price per
share offered to shareholders of the Company in any tender offer or exchange
offer whereby a Change of Control takes place, or (iii) if such Change of
Control occurs other than in (i) or (ii) above, the fair market value per share
of the shares into which Awards are exercisable, as determined by the Committee,
whichever is applicable. In the event that the consideration offered to
shareholders of the Company consists of anything other than cash, the Committee
shall determine the fair cash equivalent of the portion of the consideration
offered which is other than cash.
(g) "Code" means the Internal Revenue Code of 1986, as amended. Reference
in the Plan to any section of the Code shall be deemed to include any amendments
or successor provisions to any section and any regulations under such section.
(h) "Committee" means the Stock Option Committee of the Board which shall
be (i) constituted so as to permit the Plan to comply with Rule 16b-3 and (ii)
constituted solely of "outside directors," within the meaning of section 162(m)
of the Code and applicable interpretive authority thereunder.
(i) "Company" means Howell Corporation and any successors thereto.
(j) "Director" means an individual elected to the Board by the shareholders
of the Company or by the Board under applicable corporate law who is serving on
the Board on the date the Plan is adopted by the Board or is elected to the
Board after such date.
(k) An "employee" means any person (including an officer or a Director but
excluding a non-employee Director) in an employment relationship with the
Employer.
(l) "Employer" means the Company, an Affiliate or any Subsidiary.
(m) "Fair Market Value" means, with respect to a share of Stock as of any
specified date, the closing price of the Stock as reported in The Wall Street
Journal's New York Stock Exchange ("NYSE") - Composite Transactions listing for
such day (corrected for obvious typographical errors), or if the shares are
listed for trading on the NYSE but no closing price is reported in such listing
for such day, then the last reported closing price for such shares on the NYSE,
or if such shares are not listed or traded on the NYSE, the closing sales price
on any national securities exchange on which the Stock is traded, or if the
Stock is not traded on any national securities exchange, then the mean of the
reported high and low sales prices for such shares in the over-the-counter
market, as reported on the National Association of Securities Dealers Automated
Quotations System, or, if such prices shall not be reported thereon, the mean
between the closing bid and asked prices reported by the National Quotation
Bureau Incorporated, or, in all other cases, the value established by the
Committee in good faith.
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(n) "Forfeiture Restrictions" means with regard to shares of Stock that are
subject to a Restricted Stock Award, restrictions placed on a Holder's
disposition of such shares under certain circumstances or an obligation of a
Holder to forfeit and surrender such shares under certain circumstances.
(o) "Holder" means an employee, officer or consultant who has been granted
an Award.
(p) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(q) "1988 Plan" means the 1988 Stock Option Plan of Howell Corporation.
(r) "1997 Plan" means the Howell Corporation 1997 Nonqualified Stock Option
Plan.
(s) "Option" means an option granted under Paragraph VII of the Plan to
purchase Stock which does not constitute an incentive stock option within the
meaning of section 422(b) of the Code.
(t) "Optionee" means a Holder who has been granted an Option.
(u) "Option Agreement" means a written agreement between the Company and a
Holder with respect to an Option.
(v) "Option Plans" means both the 1988 Plan and the 1997 Plan.
(w) "Performance Award" means an Award granted under Paragraph IX of the
Plan.
(x) "Performance Award Agreement" means a written agreement between the
Company and a Holder with respect to a Performance Award.
(y) "Plan" means the Howell Corporation Omnibus Stock Awards and Incentive
Plan, as amended from time to time.
(z) "Restricted Stock Agreement" means a written agreement between the
Company and a Holder with respect to a Restricted Stock Award.
(aa) "Restricted Stock Award" means an Award granted under Paragraph VIII
of the Plan.
(bb) "Rule 16b-3" means SEC Rule 16b-3 promulgated under the 1934 Act, as
such may be amended from time to time, and any successor rule, regulation or
statute fulfilling the same or a similar function.
(cc) "Stock" means the common stock, $1.00 par value of the Company.
(dd) "Subsidiary" means any corporation or entity of which more than 50% of
the outstanding securities or ownership interests having ordinary voting power
to elect a majority of the members of the Board of Directors, or persons in
similar capacity of such corporation or entity, is, directly or indirectly owned
by the Company.
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III. EFFECTIVE DATE AND DURATION OF THE PLAN
The Plan shall be effective upon the date of its adoption by the Board,
provided that the Plan is approved by the shareholders of the Company within
twelve months thereafter. All awards granted under this Plan prior to
shareholder approval of the Plan should be expressly subject to such approval.
If the Plan is not approved by the shareholders within twelve months of the date
the Board approved the Plan, the Plan shall terminate and all options previously
granted under the Plan shall become void and of no effect. No further Awards may
be granted under the Plan after the expiration of ten years from the date of its
adoption by the Board. The Plan shall remain in effect until all Awards granted
under the Plan have been satisfied or expired.
IV. ADMINISTRATION
(a) Committee. The Plan shall be administered by the Committee.
(b) Powers. Subject to the provisions of the Plan, the Committee shall have
sole authority, in its discretion, to determine which employees, officers or
consultants shall receive an Award, the time or times when such Award shall be
made, whether an Option, a Restricted Stock Award or a Performance Award shall
be granted, the number of shares of Stock which may be issued under each Option,
Restricted Stock Award, or the value of each Performance Award. In making such
determinations the Committee may take into account the nature of the services
rendered by the respective employees, officers and consultants, their present
and potential contributions to the Employer's success and such other factors as
the Committee in its discretion shall deem relevant.
(c) Additional Powers. The Committee shall have such additional powers as
are delegated to it by the other provisions of the Plan. Subject to the express
provisions of the Plan, the Committee is authorized to construe the Plan and the
respective agreements executed thereunder, to prescribe such rules and
regulations relating to the Plan as it may deem advisable to carry out the Plan,
and to determine the terms, restrictions and provisions of each Award and to
make all other determinations necessary or advisable for administering the Plan.
The Committee may correct any defect or supply any omission or reconcile any
inconsistency in any agreement relating to an Award in the manner and to the
extent it shall deem expedient to carry it into effect. The determinations of
the Committee on the matters referred to in this Article IV shall be conclusive.
(d) Expenses. All expenses and liabilities incurred by the Committee in the
administration of this Plan shall be borne by the Company. The Committee may
employ attorneys, consultants, accountants or other persons to assist the
Committee in the carrying out of its duties hereunder.
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V. STOCK SUBJECT TO THE PLAN
(a) Stock Grant and Award Limits. The Committee may from time to time grant
Awards to one or more employees, officers or consultants determined by it to be
eligible for participation in the Plan in accordance with the provisions of
Paragraph VI. Subject to Paragraph X, the aggregate number of shares of Stock
that may be issued under the Plan shall not exceed a number of shares of Stock
calculated as follows: (i) 50,000, plus (ii) the total number of shares of Stock
subject to options which are outstanding under the Option Plans, which were
granted to employees, and which expire or lapse under the terms of the Option
Plans or related option agreements during the term of this Plan or which
otherwise terminate or are cancelled, including but not limited to a
relinquishment of an outstanding option for cash, without being exercised during
the term of this Plan; provided, however that the aggregate number of shares of
Stock that may be issued under the Plan shall not exceed 884,076, subject to any
adjustments under Paragraph X. The shares subject to this Plan shall consist of
authorized but unissued shares of Stock or previously issued shares of Stock
reacquired and held by the Company, and such number of shares shall be and is
hereby reserved for such purpose. Shares of Stock shall be deemed to have been
issued under the Plan only to the extent actually issued and delivered pursuant
to an Award. To the extent that an Award lapses or the rights of its Holder
terminate or the Award is to only be paid in cash or is paid in cash, any shares
of Stock subject to such Award shall again be available for the grant of an
Award.
(b) Stock Offered. The stock to be offered pursuant to the grant of an
Award may be authorized but unissued Stock or Stock previously issued and
outstanding and reacquired by the Company.
VI. ELIGIBILITY
Awards may be granted only to persons who, at the time of grant, are
employees, officers or consultants of the Company and its Subsidiaries. Awards
under this Plan may not be granted to any Director who is not an employee. An
Award may be granted on more than one occasion to the same person, and, subject
to the limitations set forth in the Plan, such Award may include an Option, a
Restricted Stock Award, a Performance Award, or any combination thereof.
VII. STOCK OPTIONS
(a) Option Period. The term of each Option shall be as specified by the
Committee at the date of grant.
(b) Limitations on Exercise of Option. No more than 884,076 shares of Stock
may be subject to an Option. An Option shall be exercisable in whole or in such
installments and at such times as determined by the Committee.
(c) Option Agreement. Each Option shall be evidenced by an Option Agreement
in such form and containing such provisions not inconsistent with the provisions
of the Plan as the Committee from time to time shall approve. An Option
Agreement may provide for the payment of the option price, in whole or in part,
in cash or by the delivery of a number of shares of Stock (plus cash if
necessary) having a Fair Market Value equal to such option price. Each Option
shall specify the effect of termination of employment or service on the
exercisability of the Option. Moreover, an Option Agreement may provide for a
"cashless exercise" of the Option by establishing procedures whereby the Holder,
by a properly-executed written notice, directs (i) an immediate market sale or
margin loan respecting all or a part of the shares of Stock to which he is
entitled upon exercise pursuant to an extension of credit by the brokerage firm
to the Holder of the option price, (ii) the delivery of the shares of Stock from
the Company directly to a brokerage firm and (iii) the delivery of the option
price from the sale or margin loan proceeds from the brokerage firm directly to
the Company. Such Option Agreement may also include, without limitation,
provisions relating to (i) vesting of Options, (ii) tax matters (including
provisions (y) permitting the delivery of additional shares of Stock or the
withholding of shares of Stock from those acquired upon exercise to satisfy
federal or state income tax withholding requirements and (z) dealing with any
other applicable employee wage withholding requirements), and (iii) any other
matters not inconsistent with the terms and provisions of this Plan that the
Committee shall in its sole discretion determine. The terms and conditions of
the respective Option Agreements need not be identical.
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(d) Option Price and Notice of Exercise. The price at which a share of
Stock may be purchased upon exercise of an Option shall be determined by the
Committee; provided that (i) such purchase price shall not be less than the Fair
Market Value of Stock on the date the Option is granted and (ii) such purchase
price shall be subject to adjustment as provided in Paragraph X. The Option or
portion thereof may be exercised by delivery of an irrevocable notice of
exercise to the Company.
(e) Stockholder Rights and Privileges. The Holder shall be entitled to all
the privileges and rights of a stockholder only with respect to such shares of
Stock as have been purchased under the Option and for which certificates of
stock have been registered in the Holder's name.
(f) Options in Substitution for Stock Options Granted by Other
Corporations. Options may be granted under the Plan from time to time in
substitution for stock options held by individuals employed by corporations who
become employees, officers or consultants as a result of a merger or
consolidation of the employing corporation with the Company, an Affiliate, or
any Subsidiary, or the acquisition by the Company, an Affiliate or a Subsidiary
of the assets of the employing corporation, or the acquisition by the Company,
an Affiliate or a Subsidiary of stock of the employing corporation with the
result that such employing corporation becomes a Subsidiary.
VIII. RESTRICTED STOCK AWARDS
(a) Restricted Stock Awards. A Restricted Stock Award shall be represented
by a certificate of Stock registered in the name of the Holder of such
Restricted Stock Award. The Holder shall have the right to receive dividends
with respect to Stock subject to a Restricted Stock Award, to vote Stock subject
thereto and to enjoy all other stockholder rights, except that (i) the Holder
shall not be entitled to delivery of the Stock certificate until the Forfeiture
Restrictions shall have expired, (ii) the Company shall retain custody of the
Stock until the Forfeiture Restrictions shall have expired, (iii) the Holder may
not sell, transfer, pledge, exchange, hypothecate or otherwise dispose of the
Stock until the Forfeiture Restrictions shall have expired, and (iv) a breach of
the terms and conditions established by the Committee pursuant to the Restricted
Stock Agreement shall cause a forfeiture of the Restricted Stock Award.
(b) Forfeiture Restrictions to be Established by the Committee. The
Forfeiture Restrictions on shares of Stock that are the subject of a Restricted
Stock Award shall be determined by the Committee in its sole discretion, and the
Committee may provide that the Forfeiture Restrictions shall lapse upon (i) the
attainment of targets established by the Committee that may be based on (1) the
price of a share of Stock, (2) the Company's earnings per share, (3) the
Company's revenue, (4) the revenue of a business unit of the Company designated
by the Committee, (5) the return on shareholders' equity achieved by the
Company, or (6) the Company's pre-tax cash flow from operations, (ii) the
Holder's continued employment with the Employer for a specified period of time,
(iii) a combination of any two or more of the factors listed in clauses (i) and
(ii) of this sentence or (iv) any other factors or conditions as determined by
the Committee in its sole discretion. Each Restricted Stock Award may have
different Forfeiture Restrictions, in the discretion of the Committee. The
Forfeiture Restrictions applicable to a particular Restricted Stock Award shall
not be changed except as permitted by this Paragraph VIII or Paragraph X.
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(c) Other Terms and Conditions. No more than 200,000 shares of Stock may be
used for Restricted Stock Awards. At the time of a Restricted Stock Award, the
Committee may, in its sole discretion, prescribe additional terms, conditions or
restrictions relating to Restricted Stock Awards, including, but not limited to,
rules pertaining to the termination of employment or the termination of service
of a Holder prior to expiration of the Forfeiture Restrictions. Such additional
terms, conditions or restrictions shall be set forth in a Restricted Stock
Agreement made in conjunction with the Award. Such Restricted Stock Agreement
may also include, without limitation, provisions relating to (i) vesting of
Awards, (ii) tax matters (including provisions (y) covering any applicable
employee wage withholding requirements and (z) prohibiting an election by the
Holder under section 83(b) of the Code), and (iii) any other matters not
inconsistent with the terms and provisions of this Plan that the Committee shall
in its sole discretion determine. The terms and conditions of the respective
Restricted Stock Agreements need not be identical.
(d) Payment for Restricted Stock. The Committee shall determine the amount
and form of any payment for Stock received pursuant to a Restricted Stock Award,
provided that in the absence of such a determination, a Holder shall not be
required to make any payment for Stock received pursuant to a Restricted Stock
Award, except to the extent otherwise required by law.
(e) Agreements. At the time any Award is made under this Paragraph VIII,
the Company and the Holder shall enter into a Restricted Stock Agreement setting
forth each of the matters contemplated hereby, and, in addition such matters as
set forth in Paragraph VIII(b) as the Committee may determine to be appropriate.
The terms and provisions of the respective Restricted Stock Agreements need not
be identical.
IX. PERFORMANCE AWARDS
(a) Performance Period. The Committee shall establish, with respect to and
at the time of each Performance Award, a performance period over which the
performance of the Holder shall be measured.
(b) Performance Awards. Each Performance Award shall have a maximum value
established by the Committee at the time of such Award. No more than 200,000
shares of Stock may be used for Performance Awards.
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(c) Performance Measures. A Performance Award shall be awarded to an
employee contingent upon future performance of the employee, the Company, an
Affiliate, any Subsidiary, or any division or department thereof by or in which
he is employed during the performance period. The Committee shall establish the
performance measures applicable to such performance prior to the beginning of
the performance period but subject to such later revisions as the Committee
shall deem appropriate to reflect significant, unforeseen events or changes. The
performance measures established by the Committee may be based on (i) the price
of a share of Stock, (ii) the Company's earnings per share, (iii) the Company's
revenue, (iv) the revenue of a business unit of the Company designated by the
Committee, (v) the return on shareholders' equity achieved by the Company, or
(vi) the Company's pre-tax cash flow from operations, (vii) a combination of any
two or more of the factors listed in clauses (i) through (vi) of this sentence
or (viii) any other factors or conditions as determined by the Committee in its
sole discretion.
(d) Awards Criteria. In determining the value of Performance Awards, the
Committee shall take into account an employee, officers or consultant's
responsibility level, performance, potential, other Awards and such other
considerations as it deems appropriate.
(e) Payment. Following the end of the performance period, the Holder of a
Performance Award shall be entitled to receive payment of an amount, not
exceeding the maximum value of the Performance Award, based on the achievement
of the performance measures for such performance period, as determined by the
Committee. Payment of a Performance Award may be made in cash, Stock or a
combination thereof, as determined by the Committee. Payment shall be made in a
lump sum or in installments as prescribed by the Committee. Any payment to be
made in Stock shall be based on the Fair Market Value of the Stock on the
payment date. If a payment of cash is to be made on a deferred basis, the
Committee shall establish whether interest shall be credited, the rate thereof
and any other terms and conditions applicable thereto.
(f) Termination of Employment or Service. A Performance Award shall
terminate if the Holder does not remain continuously in the employ or service of
the Employer at all times during the applicable performance period, except as
may be determined by the Committee or as may otherwise be provided in the Award
at the time granted.
(g) Agreements. At the time any Award is made under this Paragraph IX, the
Company and the Holder shall enter into a Performance Award Agreement setting
forth each of the matters contemplated hereby, and, in addition such matters as
set forth in Paragraph IX(c) as the Committee may determine to be appropriate.
The terms and provisions of the Performance Award Agreements need not be
identical.
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X. RECAPITALIZATION OR REORGANIZATION
(a) The shares with respect to which Awards may be granted are shares of
Stock as presently constituted, but if, and whenever, prior to the expiration of
an Award theretofore granted, the Company shall effect a subdivision or
consolidation of such shares of Stock or other capital readjustment, the number
of shares of Stock with respect to which such Award may thereafter be exercised
or satisfied, as applicable, (i) in the event of an increase in the number of
outstanding shares shall be proportionately increased, and the purchase price
per share shall be proportionately reduced, and (ii) in the event of a reduction
in the number of outstanding shares shall be proportionately reduced, and the
purchase price per share shall be proportionately increased.
(b) If the Company recapitalizes or otherwise changes its capital
structure, thereafter upon any exercise or satisfaction, as applicable, of an
Award theretofore granted the Holder shall be entitled to (or entitled to
purchase, if applicable) under such Award, in lieu of the number of shares of
Stock then covered by such Award, the number and class of shares of stock and
securities to which the Holder would have been entitled pursuant to the terms of
the recapitalization if, immediately prior to such recapitalization, the Holder
had been the holder of record of the number of shares of Stock then covered by
such Award.
(c) The Committee may, in its sole discretion, at the time an Award is
granted or by amendment of the Award thereafter, provide that such Award shall
become fully exercisable upon a Change of Control. The Committee, in its
discretion, may determine that upon the occurrence of a Change of Control, each
Award other than an Option outstanding hereunder shall terminate within a
specified reasonable number of days after notice to the Holder, and such Holder
shall receive, with respect to each share of Stock subject to such Award, cash
in an amount equal to the excess, if any, of the Change of Control Value over
any exercise price or purchase price paid, if applicable. If the Company is
reorganized, merged or consolidated or is otherwise a party to a plan of
exchange with another corporation pursuant to which reorganization, merger,
consolidation or plan of exchange shareholders of the Company receive any shares
of Stock or other securities or if the Company shall distribute ("Spin Off")
securities of another corporation to its shareholders, there shall be
substituted for the shares subject to the unexercised portions of outstanding
Options granted hereunder an appropriate number of shares of (i) each class of
stock or other securities which were distributed to the shareholders of the
Company in respect of such shares in the case of a reorganization, merger,
consolidation or plan of exchange, or (ii) in the case of a Spin Off, the
securities distributed to shareholders of the Company together with shares of
Stock, such number of shares or securities to be determined in accordance with
the provisions of Section 425 of the Code; provided, however, that all such
Options may be canceled by the Company as of the effective date of (x) a
reorganization, merger, consolidation, plan of exchange or Spin Off or (y) any
dissolution or liquidation of the Company, by giving notice to each Holder or
his personal representative of its intention to do so and by permitting the
purchase for a period of at least thirty days during the sixty days next
preceding such effective date of all of the shares subject to such outstanding
Options, without regard to the installment provisions set forth in the Option
Agreements; and provided further that in the event of a Spin Off, the Company
may, in lieu of substituting securities or accelerating and canceling Options as
contemplated above, elect (i) to reduce the purchase price for each share of
Stock subject to an outstanding Option by an amount equal to the fair market
value of the securities distributed in respect of each outstanding share of
Stock in the Spin Off or (ii) to reduce proportionately the purchase price per
share and to increase proportionately the number of shares of Stock subject to
each Option in order to reflect the economic benefits inuring to the
shareholders of the Company as a result of the Spin Off.
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(d) In the event of changes in the outstanding Stock by reason of
recapitalization, reorganizations, mergers, consolidations, combinations,
exchanges or other relevant changes in capitalization occurring after the date
of the grant of any Award and not otherwise provided for by this Paragraph X,
any outstanding Awards and any agreements evidencing such Awards shall be
subject to adjustment by the Committee at its reasonable discretion as to the
number and price of shares of Stock or other consideration subject to such
Awards. In the event of any such change in the outstanding Stock, the aggregate
number of shares available under the Plan may be appropriately adjusted by the
Committee, whose determination shall be reasonable and conclusive.
(e) The existence of the Plan and the Awards granted hereunder shall not
affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of debt or equity securities ahead of or
affecting Stock or the rights thereof, the dissolution or liquidation of the
Company or any sale, lease, exchange or other disposition of all or any part of
its assets or business or any other corporate act or proceeding.
(f) Any adjustment provided for in Subparagraphs (a), (b), (c) or (d) above
shall be subject to any required stockholder action.
(g) Except as hereinbefore expressly provided, the issuance by the Company
of shares of stock of any class or securities convertible into shares of stock
of any class, for cash, property, labor or services, upon direct sale, upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares of obligations of the Company convertible into such shares or other
securities, and in any case whether or not for fair value, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number of
shares of Stock subject to Awards theretofore granted or the purchase price per
share, if applicable.
XI. AMENDMENT AND TERMINATION OF THE PLAN
Except as set forth herein, the Board in its discretion may terminate the
Plan at any time with respect to any shares for which Awards have not
theretofore been granted. Except as set forth herein, the Board shall have the
right to alter or amend the Plan or any part thereof from time to time. Neither
a termination of the Plan nor a change in any Award theretofore granted may be
made which would impair the rights of the Holder without the consent of the
Holder (unless such change is required in order to cause the benefits under the
Plan to qualify as performance-based compensation within the meaning of section
162(m) of the Code and applicable interpretive authority thereunder). The Board
may not, without approval of the shareholders, amend the Plan:
(a) to increase the maximum number of shares which may be issued on
exercise or surrender of an Award, except as provided in Paragraph X;
(b) to change the class of persons eligible to receive Awards;
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(c) to extend the maximum period during which Awards may be granted under
the Plan;
(d) to extend the expiration date of the Plan;
(e) to decrease to any extent the price at which Awards may be granted
under the Plan, except as provided in Paragraph X; or
(f) to decrease any authority granted to the Committee hereunder in
contravention of Rule 16b-3.
XII. MISCELLANEOUS
(a) No Right to An Award. Neither the adoption of the Plan by the Company
nor any action of the Board or the Committee shall be deemed to give an
employee, officer or consultant any right to be granted an Award to purchase
Stock, a Restricted Stock Award, or a Performance Award, or any of the rights
hereunder except as may be evidenced by an Award or by an Option Agreement, a
Restricted Stock Agreement, or a Performance Award Agreement on behalf of the
Company, and then only to the extent and on the terms and conditions expressly
set forth therein. The Plan shall be unfunded. The Company shall not be required
to establish any special or separate fund or to make any other segregation of
funds or assets to assure the payment of any Award.
(b) Holders' Rights Unsecured. The right of a Holder to receive Stock, cash
or any other payment under this Plan shall be an unsecured claim against the
general assets of the Company. The Company may, but shall not be obligated to,
acquire shares of Stock from time to time in anticipation of its obligations
under this Plan, but a Holder shall have no right in or against any shares of
Stock so acquired. All Stock shall constitute the general assets of the Company
and may be disposed of by the Company at such time and for such purposes as it
deems appropriate.
(c) Agreement Controls. No discretionary action by the Committee as set
forth herein shall amend or supersede the express terms of any Agreement.
(d) No Employment Rights Conferred. Nothing contained in the Plan shall (i)
confer upon any employee any right with respect to continuation of employment
with any Employer or (ii) interfere in any way with the right of any Employer to
terminate an employee's employment at any time.
(e) Other Laws; Withholding. The Company shall not be obligated to issue
any Stock pursuant to any Award granted under the Plan at any time when the
shares covered by such Award have not been registered under the Securities Act
of 1933 and such other state and federal laws, rules or regulations as the
Company or the Committee deems applicable and, in the opinion of legal counsel
for the Company, there is no exemption from the registration requirements of
such laws, rules or regulations available for the issuance and sale of such
shares. Unless the Awards and Stock covered by this Plan have been registered
under the Securities Act of 1933, or the Company has determined that such
registration is unnecessary, each Holder exercising an Award under this Plan may
be required by the Company to give representation in writing that such Holder is
acquiring such shares for his or her own account for investment and not with a
view to, or for sale in connection with, the distribution of any part thereof.
No fractional shares of Stock shall be delivered, nor shall any cash in lieu of
fractional shares be paid. The Company shall have the right to deduct in
connection with all Awards any taxes required by law to be withheld and to
require any payments required to enable it to satisfy its withholding
obligations.
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(f) No Restriction on Corporate Action. Nothing contained in the Plan shall
be construed to prevent the Company, an Affiliate or any Subsidiary from taking
any corporate action which is deemed by the Company, an Affiliate or any
Subsidiary to be appropriate or in its best interest, whether or not such action
would have an adverse effect on the Plan or any Award made under the Plan. No
Holder, beneficiary or other person shall have any claim against the Company, an
Affiliate or any Subsidiary as a result of any such action.
(g) Restrictions on Transfer. An Award shall not be transferable otherwise
than by will or the laws of descent and distribution and shall be exercisable by
the Holder of such Award or the Holder's guardian or legal representative in
accordance with the terms of the Option Agreement, Restricted Stock Agreement,
or Performance Award Agreement.
(h) Beneficiary Designation. Each Holder may name, from time to time, any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of his or her death before
he or she receives any or all of such benefit. Each designation will revoke all
prior designations by the same Holder, shall be in a form prescribed by the
Committee, and will be effective only when filed by the Holder in writing with
the Committee during his lifetime. In the absence of any such designation,
benefits remaining unpaid at the Holder's death shall be paid to his estate.
(i) Rule 16b-3. It is intended that the grant of an Award made to a person
subject to Section 16 of the 1934 Act meet all of the requirements of Rule
16b-3. If any provision of any such Award would disqualify the Plan or such
Award under, or would otherwise not comply with, Rule 16b-3, such provision or
Award shall be construed or deemed amended to conform to Rule 16b-3.
(j) Section 162(m). If the Plan is subject to Section 162(m) of the Code,
it is intended that the Plan comply fully with and meet all the requirements of
Section 162(m) of the Code so that Options granted hereunder and, if determined
by the Committee, Restricted Stock Awards and Performance Awards, shall
constitute "performance-based" compensation within the meaning of such section.
If any provision of the Plan would disqualify the Plan or would not otherwise
permit the Plan to comply with Section 162(m) as so intended, such provision
shall be construed or deemed amended to conform to the requirements or
provisions of Section 162(m); provided that no such construction or amendment
shall have an adverse effect on the economic value to a Holder of any Award
previously granted hereunder.
(k) Indemnification. Each person who is or shall have been a member of the
Committee or of the Board and any employee delegated authority hereunder shall
be indemnified and held harmless by the Company against and from any loss, cost,
liability, or expense that may be imposed upon or reasonably incurred by him in
connection with or resulting from any claim, action, suit, or proceeding to
which he may be a party or in which he may be involved by reason of any action
taken or failure to act under the Plan and against and from any and all amounts
paid by him in settlement thereof, with the Company's approval, or paid by him
in satisfaction of any judgment in any such action, suit, or proceeding against
him, provided he shall give the Company prompt written notice of any such
action, suit or proceeding, and an opportunity, at its own expense, to handle,
defend and/or settle the same before he undertakes to handle, defend and/or
settle it on his own behalf. The foregoing right of indemnification shall not be
exclusive of any other rights or indemnification to which such persons may be
entitled under the Company's Articles of Incorporation or Bylaws, as a matter of
law, or otherwise, or any power that the Company may have to indemnify them or
hold them harmless.
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(l) Governing Law. This Plan shall be construed in accordance with the laws
of the State of Delaware and applicable federal law.
IN WITNESS WHEREOF, and as conclusive evidence of the adoption of the
foregoing by the Board, Howell Corporation has caused this document to be duly
executed in its name and behalf by its proper officer thereunto duly authorized
as of the date of the adoption of the Plan by the Board, being March 16, 1999.
HOWELL CORPORATION
By: /s/ ROBERT T. MOFFETT
----------------------------
Robert T. Moffett
Vice President
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